<PAGE>   1
                                                                   EXHIBIT 13.1





                                     [LOGO]

                               1999 ANNUAL REPORT
                             AMERICAN BANCORP, INC.
                              POST OFFICE BOX 1579
                           OPELOUSAS, LOUISIANA 70570






<PAGE>   2

NATURE OF BUSINESS

     American Bancorp, Inc. is a one-bank holding company whose sole subsidiary
is American Bank and Trust Company, a commercial bank whose general business is
that of providing banking services to the Opelousas, Louisiana area. The Bank
serves the needs of the area through 44 employees at six banking locations. The
main office is located at the corner of Landry Street and Union Street in
Opelousas. Branch banking-offices are located in the parish of St. Landry in the
communities of Lawtell, Krotz Springs, Port Barre and an office on Creswell Lane
in South Opelousas. In addition, the Bank has a branch located on Moss Street,
in Lafayette, Louisiana.


MARKET PRICE AND DIVIDENDS DECLARED

<TABLE>
<CAPTION>
                                                                  Dividends
    Year          Quarter             High           Low          Per Share
    ----          -------             ----           ----         ---------
<S>               <C>                 <C>            <C>          <C>
    1999          First               $ 60           $ 60         $       -
                  Second                61             61                 -
                  Third                 61             61                 -
                  Fourth                62             62              1.45


    1998          First               $ 53           $ 53         $       -
                  Second                55             55                 -
                  Third                 57             57                 -
                  Fourth                60             30              1.25
</TABLE>


Note: The primary market area for American Bancorp, Inc.'s common stock is the
Opelousas, Louisiana area with American Bank and Trust Company acting as
registrar and transfer agent. There were approximately 516 shareholders of
record at December 31, 1999.

     Source of market price - American Bank & Trust Company acts as the transfer
agent for the Company. The stock is thinly traded and the price ranges are based
on stated sales price to the transfer agent, which does not represent all sales.


ANNUAL SHAREHOLDERS' MEETING

     The annual meeting of the shareholders of American Bancorp, Inc. will be
held on April 12, 2000 in the Board of Directors Room at the Operations Center
located at 321 East Landry Street, Opelousas, Louisiana.


FORM 10-K ANNUAL REPORT

     American Bancorp, Inc. files an annual report with the Securities and
Exchange Commission on Form 10-K. A copy of the report filed on Form 10-K will
be sent free of charge to any shareholder by writing to: Ronald J. Lashute,
Chief Executive Officer and Executive Vice-President, American Bank and Trust
Company, Post Office Box 1579, Opelousas, Louisiana 70570.




                                       -1-




<PAGE>   3



                                FINANCIAL SUMMARY
           (In thousands of dollars except per share data and ratios)


<TABLE>
<CAPTION>
                                                                  1999           1998             1997
                                                                  ----           ----             ----
<S>                                                       <C>              <C>              <C>
FOR THE YEAR

         Net income ...................................     $     1,086      $     1,008      $       948

         Return on average shareholders' equity .......           11.38%           11.27%           11.70%

         Return on average total assets ...............            1.42%            1.47%            1.47%

AT YEAR END

         Total assets .................................     $    80,232      $    73,666      $    64,621

         Total earning assets .........................     $    71,670      $    67,114      $    57,377

         Total loans ..................................     $    28,253      $    27,463      $    27,835

         Total deposits ...............................     $    70,434      $    63,819      $    55,857

         Total shareholders' equity ...................     $     9,506      $     9,446      $     8,513

         Common shares outstanding ....................         117,712          118,449          119,962


PER SHARE

         Net income ...................................     $      9.21      $      8.47       $     7.90

         Book value ...................................     $     80.75      $     79.75       $    70.96

         Cash dividends declared ......................     $      1.45      $      1.25       $     1.10


CAPITAL RATIOS

         Total risk-based capital ratio ...............           29.82%           28.72%           27.38%

         Leverage ratio ...............................           13.11%           13.36%           12.97%
</TABLE>







                                       -2-
<PAGE>   4



                                 C O N T E N T S

<TABLE>
<CAPTION>
                                                                           PAGE
<S>                                                                        <C>
Financial Summary ................................................         2

A Message to the Shareholders ....................................         4

Management's Discussion and Analysis of Financial
   Condition and Results of Operations ...........................         5 - 27

Independent Auditors' Report .....................................         28

Consolidated balance sheets ......................................         29 and 30

Consolidated statements of income ................................         31

Consolidated statements of changes in shareholders' equity .......         33

Consolidated statements of cash flows ............................         34

Notes to consolidated financial statements .......................         35 - 54

Officers and directors of American Bank & Trust Company ..........         55

Officers and directors of American Bancorp, Inc. .................         56
</TABLE>











                                       -3-

<PAGE>   5



                               TO THE SHAREHOLDERS

     Last year's performance for American Bancorp, Inc. and American Bank &Trust
Co., its sole subsidiary, proved to be most successful. Growth and income goals
of the company were exceeded.In fact, last year's net income of $1,085,545 was
the best in the history of the bank. As a result of earnings, return on average
assets was 1.42% and return on equity was 11.38%.

     Earnings this past year was $9.21 per share compared to $8.47 in 1998. The
book value of the company's stock was increased to end the year at $80.75 per
share. Dividends paid to the shareholders in 1999 was $1.45 per share
representing a 16% increase over dividends paid in 1998 and a 70% increase from
the dividend paid in 1995.

     Exceptional growth last year was a major contributing factor to the bank's
increased earnings. As a result of growth, average assets during 1999 were
$76,452,000, up from $68,472,000 in 1998. This represents an increase of 11.7%
or $7,980,000.

     As the bank's assets and earnings have continued to grow, asset quality
remains remarkably good. At December 31, 1999, nonperforming assets were only
 .14% of the total assets and net charge off loans as a percentage of average
total loans was only .06%. The bank also remains well capitalized with a
leverage capital ratio at year end of 13.11%.

     The results of past performance has positioned the company to move forward
in the New Millennium with a strong capital base and the resources necessary to
provide the products and services that new technology has to offer. A new
computer system with enhanced software will be installed at the bank during the
first half of 2000, thus enabling the bank to offer increased customer service.
In Lafayette, the year 2000 will bring construction of a new full service
banking facility allowing the relocation of the Lafayette Branch.

     We appreciate the continuing support from you our shareholders and
customers, and promise to manage the company with the same work ethic that you
have come to expect from our management and dedicated staff of employees.






/S/ SALVADOR L. DIESI
Salvador L. Diesi, Sr., Chairman of the Board
         and President




/s/ RONALD J. LASHUTE
Ronald J. Lashute, Chief Executive Officer and
         Executive Vice-President of American
         Bank &Trust Co.






                                       -4-


<PAGE>   6





           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS


                 SUMMARY OF OPERATIONS FOR THE LAST FIVE YEARS
           (In thousands of dollars except per share data and ratios)


<TABLE>
<CAPTION>
                                                                               YEAR ENDED DECEMBER 31,
                                                    -------------------------------------------------------------------------------
                                                        1999             1998             1997             1996             1995
                                                    -------------------------------------------------------------------------------

<S>                                                 <C>              <C>              <C>              <C>              <C>
Operating Data:
      Net interest income .....................     $     3,308      $     3,211      $     3,085      $     2,976      $     3,065
      Provision for possible loan
         losses ...............................     $        --      $        --      $        --      $        --      $        --
      Net income ..............................     $     1,086      $     1,008      $       948      $     1,038      $       963

Per share data:
      Weighted average number of
         shares outstanding ...................         117,884          118,965          119,997          120,000          120,000
      Net income ..............................     $      9.21      $      8.47      $      7.90      $      8.65      $      8.03
      Cash dividends declared .................     $      1.45      $      1.25      $      1.10      $      1.00      $       .85
      Book value at end of year ...............     $     80.75      $     79.75      $     70.96      $     63.80      $     56.55

Balance sheet totals:
      Average assets ..........................     $    76,452      $    68,472      $    64,384      $    61,012      $    58,733
      Average shareholders' equity ............     $     9,536      $     8,942      $     8,099      $     7,251      $     6,230

Relationship between significant financial ratios:
         Percentage of net income
            to average total assets ...........            1.42%            1.47%            1.47%            1.70%            1.64%
         Percentage of net income
            to average shareholders'
            equity ............................           11.38%           11.27%           11.70%           14.32%           15.46%
         Percentage of dividends
            declared per common share
            to net income per common
            share .............................           15.74%           14.76%           13.92%           11.56%           10.59%
         Percentage of average share-
            holders' equity to average
            total assets ......................           12.47%           13.06%           12.58%           11.88%           10.60%
      Tier 1 risk-based capital ratio .........           28.57%           27.47%           26.13%           23.23%           21.92%
      Total risk-based capital ratio ..........           29.82%           28.72%           27.38%           24.48%           23.17%
      Leverage ratio ..........................           13.11%           13.36%           12.97%           12.44%           11.36%
</TABLE>







                                       -5-
<PAGE>   7



     Management's discussion and analysis of financial condition and results of
operations should be read in conjunction with the accompanying financial
statements and notes.


OVERVIEW

     The Company reported net income of $1,085,545 in 1999 compared to
$1,007,868 in 1998 and $947,536 in 1997. Interest income has increased over the
last three years. The increase for 1999 was $.163 million and an increase of
$.174 million from 1997 to 1998. Interest expense also increased in 1999. The
increase for 1999 was $.66 million and an increase of $.49 million from 1997 to
1998. Net income before taxes has been increasing over the past three years.

     Average total assets continue to increase. These assets have grown 11.7%,
6.4% and 5.5% in 1999, 1998, and 1997, respectively. This increase is a result
of the growth of non-interest bearing demand deposits and time deposits in 1999
and 1998. Non-interest bearing demand deposits increased $4.892 million in 1999
or 25.65% over the 1998 balance and an increase of $2.224 million in 1998 or
13.2% over the 1997 balance. Time deposits increased $2.283 million or 11.56% in
1999 over the 1998 amounts and $.744 million or 3.9% in 1998 over the 1997
amounts.

     The year end balance sheet reflects an increase of $6.565 million or 8.91%
in total assets. Cash reflected an increase of $1.716 million or 39.60% from
1998. During the same period, total securities increased by $4.508 million or
15.17%. In addition, total deposits increased $6.615 million or 10.37% in
comparing 1999 to 1998. For the same period, there was an increase of $.060
million in stockholders' equity.

STATEMENT OF INCOME ANALYSIS

     Net interest income on a taxable-equivalent basis was $3.499 million in
1999, an increase of $.175 million, or 5.26% compared to 1998. In 1998, net
interest income was $3.324 million, an increase of $.165 million, or 5.22% over
the prior year. The net interest margin for 1999 was 5.00% compared to 5.32% in
1998 and 5.39% for 1997. Table 1 summarizes average balances, income and average
yields on earning assets and expense and average rates paid on interest bearing
liabilities. Table 2 analyzes the change in net interest income for the two most
recent annual intervals.

     The increase in the average balances of short-term investments and
securities available for sale had a positive effect on the change in net
interest margin from 1998 to 1999. However, this effect was partially negated by
the decrease in average rates earned on these assets. The increase in the
average balance on time and saving deposits also had an impact on the change in
the net interest margin from 1998 to 1999.

Provision for Possible Loan Losses. The provision for possible loan losses was
$-0- in 1999, 1998 and 1997. As a percentage of outstanding loans, the allowance
for possible loans losses was 2.01%, 2.12% and 2.11% at December 31, 1999, 1998
and 1997, respectively. The annual provision is determined by the level of net
charge offs, the size of the loan portfolio, the level of nonperforming loans,
anticipated economic conditions, and review of financial condition of specific
customers.







                                       -6-

<PAGE>   8





NON-INTEREST INCOME. Non-interest income increased $80,161 or 13.09% from 1998
to 1999. There was only a slight increase of $5,987 or 1.00% from 1997 to 1998.
The increase in 1999 was due to NSF charges of the Bank's customers. The Bank's
management realizes that non-interest income will become increasingly important
as deregulation continues to impact the net interest margin; therefore, we are
continuously evaluating new opportunities for fee revenues through proper
pricing of services and the development of new sources of non-interest revenue.

NON-INTEREST EXPENSE. Non-interest expense increased $104,494 or 4.34% in 1999
from 1998. The increase from 1997 to 1998 was $68,470 or 2.93%. There is no one
particular expense category that has experienced a large increase in 1999. The
increase is spread over a large number of accounts. In comparing 1999 to 1998
and 1997, there were immaterial variances between years. These increases are
mainly due to increases in overall salaries for the three year period.

INCOME TAXES. The Company recorded income tax expense of $402,933 in 1999
compared to $407,896 in 1998 and $405,265 in 1997.

     Net future deductible temporary differences at December 31, 1999 was
$101,411. The allowance for loan losses represents $40,063 and the deferred
executive compensation represents $46,660 of the future deductible temporary
differences. The provision for possible loan losses which contributed to the
allowance has been recognized as expense for financial reporting purposes but is
not deductible for federal income tax purposes until the loans are charged off.
The deferred executive compensation is an expense for financial reporting
purposes but is not deductible until actually paid. Valued at the 34% federal
statutory tax rate, the net future deductible amounts, if ultimately recognized,
would generate tax benefits of $30,353. These benefits are recorded as a
deferred tax asset at December 31, 1999.


BALANCE SHEET AND CAPITAL FUNDS ANALYSIS

      Investment securities are a major use of funds by the Bank. The balance at
December 31, 1999 was $34,222,304 which represented a $4,508,086 or 15.17%
increase from the $29,714,218 balance outstanding at December 31, 1998.
Investment securities serve several purposes. A portion of investment securities
provides liquidity or secondary reserves, which management can use, if
necessary, to meet loan demand or deposit withdrawals. Investment securities,
especially obligations of state and political subdivisions, provide for schools,
road construction, sewers, and various other projects. The Bank invests a
portion of these funds in the market area as a service to the community in which
it operates. The remainder of these funds are invested in obligations of the
United States Government or its agencies. It is management's policy to minimize
risk in investments and provide liquidity by investing in short-term maturities
with quality ratings. While a substantial portion of the investment portfolio is
pledged on public deposits (36%), this is less than 1998 pledged percentage of
39%. The amount of public funds on deposit has been increasing slightly for the
last three years and management anticipates this source of deposits will not
grow substantially in the future.

     The Bank's primary use of funds is to meet loan demand. Loans, net of
unearned income, were $28,832,360 at December 31, 1999, compared to $28,058,357
at December 31, 1998. This $774,003 or 2.76% increase is the result of increased
market share in the market area.






                                       -7-

<PAGE>   9





     The Bank attracts deposits from consumers and businesses, and also utilizes
its access to the money markets to purchase funds to support the asset side of
the balance sheet. The two primary sources of funds may be classified as
"interest-bearing deposits" and "non-interest bearing deposits."
"Interest-bearing deposits" consist of time deposits, savings accounts, NOW
accounts and Money Market deposit accounts. The largest source of "non-interest
bearing deposits" is demand deposits, which consist of gross demand deposits
less reciprocal balances with our correspondent banks.

     As of December 31, 1999, total deposits increased $6,615,384 or 10.37% from
December 31, 1998. The most significant change in deposits from 1998 to 1999
were increases in NOW and non-interest bearing demand deposit accounts of
$2,644,175 or 24.11% and $2,776,805 or 13.21%, respectively. The increase in NOW
accounts is attributable to an increase in deposits in 1999 as compared to 1998
by a local public body. The increase in non-interest bearing accounts is
attributable to an increase in commercial accounts in 1999.

     Shareholders' equity increased $60,168 or .64% from December 31, 1998 to
December 31, 1999. Retained earnings increased $914,862 or 14.02% in 1999.
However, the accumulated other comprehensive income at 1998 of $256,187 became a
loss of $553,801 in 1999 due to the effect of interest rate hikes on the
investment portfolio. The equity or book value of the Bank is the shareholders'
investment in the Bank resulting from the sale of stock and the accumulation of
earnings retained by the Bank. The strength of the Bank and its ability to grow
depends to a great extent on management's ability to maintain a corresponding
growth in shareholders' equity.

     We declared cash dividends in the amount of $170,683 or $1.45 per share in
1999 and $148,134 or $1.25 per share in 1998. Dividends of $132,000 or $1.10 per
share were declared in 1997.

NONPERFORMING ASSETS AND PAST DUE LOANS. Nonperforming assets are loans carried
on a nonaccrual basis, those classified as restructured loans (loans with
below-market interest rates or other concessions due to the deteriorated
financial condition of the borrower), repossessed real estate, property in the
process of being repossessed and repossessed movable property. A loan is placed
on nonaccrual when, in management's judgment, the borrower's financial condition
has deteriorated to the point that his ability to service the principal and/or
interest is in doubt. At that time, any accrued interest on the loan is reversed
and accruing of interest is discontinued. The Company's nonperforming assets
consist primarily of a small number of installment loans.

     Nonperforming assets at December 31, 1999 were $109,029, a decrease of
$96,520 or 46.96% from December 31, 1998. The most significant decrease in
nonperforming assets from 1998 to 1999 was in the loans on nonaccrual status.
This resulted primarily from collections on a group of automobile loans
purchased in 1996. The Bank has experienced little activity in other real estate
for the three year period ended December 31, 1999. Management anticipates this
favorable trend to continue.

     Loans are considered to be impaired when it is probable that all amounts
due in accordance with the contractual terms will not be collected. Included in
nonaccrual loans are loans that are considered to be impaired, which totaled
$69,889 at December 31, 1999 and $144,797 at December 31, 1998. The allowance
for loan losses related to these loans was $10,000 and $100,000 at December 31,
1999 and 1998, respectively.










                                       -8-
<PAGE>   10



LIQUIDITY. Liquidity is the ability to ensure that adequate funds are available
to satisfy contractual liabilities, fund operations, meet withdrawal
requirements of depositors, and provide for customers' credit needs in a timely
manner. The liquidity position of the Bank is founded on a stable base of core
deposits. The primary source of liquidity for the Bank is its short-term
investments. The Bank has overnight fund lines with correspondent banks
providing additional sources of liquidity. Securities available for sale also
provide a major source of liquidity to the Bank, as do the cash flows from
repayments and maturities of its loan portfolio. The franchise from which the
Bank operates allows access to a broad base of retail customers, and management
has been successful at attracting additional deposits when a continuing need for
further funding has arisen. The Bank's core deposit base is supplemented by
public fund time deposits and federal funds obtained through correspondent
relationships.

     At the Parent Company (American Bancorp, Inc.) level, cash is needed to
fund operations and to pay dividends. During December 31, 1999, the Parent
Company received $230,000 from the Bank in dividends. The majority of these
funds were used to pay dividends to stockholders and to repurchase outstanding
Company stock.

     The purpose of liquidity management is to assure that the Bank has the
ability to raise funds to support asset growth, meet deposit withdrawal,
maintain reserve requirements and otherwise operate the Bank on a continuing
basis. Liquidity for the Bank is provided by the acquisition of additional funds
in the form of deposits, borrowing such as federal funds, investment maturities
and sales, and loan maturities and repayments.

     In recognition of the increased pace of deregulation and increasing
competition, the Bank will continue to increase its competitive position in the
area to assure the availability of funds. The Bank's reputation, capital
position and base of deposits will help to insure flexibility and liquidity.

CAPITAL ADEQUACY. The management of capital is a continuous process which
consists of providing capital for anticipated growth of the Bank. An evaluation
of capital adequacy cannot be made solely in terms of total capital or related
ratios. A more comprehensive indication of financial strength is management's
ability to generate capital through the retention of earnings. The Bank's main
source of capital during the last several years has been cumulative earnings
derived through profitable operations.

     Regulations applicable to state banks and their holding companies prescribe
minimum capital levels. These levels are based on established guidelines which
relate required capital standards to both risk-weighted assets (risk-based
capital ratios) and total assets (leverage ratio). In accordance with risk-based
guidelines, assets and off-balance-sheet financial instruments are assigned
weights to measure their levels of risk. The total Tier 1 risk-based capital
ratio for the Bank was 28.57% at year end 1999 and 27.47% at year end 1998.
Leverage ratios were 13.11% and 13.36% at December 31, 1999 and 1998,
respectively. The Bank presently meets or exceeds all required risk-based
capital standards and anticipates no difficulty in maintaining those standards.





                                      -9-
<PAGE>   11
FAIR VALUES OF FINANCIAL INSTRUMENTS. Statement of Financial Accounting
Standards No. 107, "Disclosures About Fair Values of Financial Instruments"
requires disclosure of estimated fair values of financial instruments. Financial
instruments are defined as cash and contractual rights and obligations that
require settlement, directly or indirectly, in cash. Note 13 to the consolidated
financial statements provides information regarding the fair values of financial
instruments as of December 31, 1999.

MARKET RISK. Market risk is the effect that interest rate changes in market
interest rates have on a Bank's earnings and its underlying economic value.
Changes in interest rates affect a Bank's earnings by changing its net interest
income and the level of other sensitive income and operating expenses. The
underlying economic value of the Company's assets, liabilities, and off-balance
sheet instruments also are affected by changes in interest rates. These changes
occur because the present value of future cash flows, and in some cases the cash
flows themselves, change when interest rates change. The combined effects of the
changes in these present values reflect the change in the Bank's underlying
economic value.

    Table 14 presents the Bank's Interest Rate Sensitivity Analysis. The table
is prepared utilizing present value calculations. Present value is the future
cash flows of a financial instrument, or portfolio of financial instruments,
discounted to the present. The discount rate is constructed by the use of the
build-up approach or the risk premium approach.

    The build-up approach views the discount rate as consisting of four
components. They are risk-free rate, credit risk, operating expense, and
prepayment option price. Risk-free rate forms the foundation of the discount
rate and is derived from the Treasury yield curve. The credit risk component is
the annualized yield needed to cover the loss of value expected over the entire
life of a portfolio. The operating expense component represents an annualized
cost rate derived from operating expense allocations. This component is used to
adjust the risk-free rate in order to compensate for operating expenses. The
prepayment option price is the final component, and represents a basis point
adjustment to the risk-free rate to reflect the value of imbedded prepayment
options.

    The risk premium approach views the discount rate as the sum of two
components: the risk-free rate, and a risk premium. The risk-free rate is the
same as defined above. The risk premium is the annualized yield needed to cover
the risk reflected in the portfolio. This risk premium incorporates all forms of
risk in a single spread to the Treasury yield curve. Consistent with an entry
rate concept of selecting a discount rate, the marginal pricing rate for each
account serves as the basis for determining an appropriate risk premium to the
Treasury yield curve. This risk premium is calculated by subtracting the value
on the Treasury yield curve which corresponds to the average maturity of the
account from the account's marginal pricing rate.

    The build-up approach is used for loans, deposits, and short-term borrowing.
The risk premium approach is used for securities and short-term investments.

    The cash flows for all assets and liabilities are estimated based upon
reasonable assumptions on the time remaining until maturity, repricing
frequency, decay factors, and prepayment rates. These assumptions are either
based on historical trends or available industry accepted information.


                                      -10-
<PAGE>   12

    The effect of an increase in 200 basis points from December 31, 1999 rates
would be a reduction of $.788 million in total market value of shareholders'
equity or a 6.89% decrease in the market value of the portfolio equity. A
decrease of 200 basis points from December 31, 1999 rates would result in an
increase of $.541 million or a 4.73% increase in the market value of the
portfolio equity.

    The effect on earnings is also reflected in Table 14. A 200 basis point
increase on the assets and liabilities outstanding as of December 31, 1999 would
result in an increase in net income of $.130 million or a 11.21% increase in net
income. A 200 basis point decrease on the assets and liabilities outstanding as
of December 31, 1999 would have the opposite effect and would result in a
decrease of net income in the amount of $.135 million or a 11.63% decrease in
net income.

    Computation of prospective effects of hypothetical interest rate changes are
based on many assumptions, including relative levels of market interest rates,
loan prepayments, and deposits decay. They should not be relied upon as
indicative of actual results. Further, the computations do not contemplate
certain actions that management could undertake in response to changes in
interest rates.

    The Bank does not invest in derivatives and has none in its securities
portfolio.

YEAR 2000. Many computer systems and software programs which run date-sensitive
applications utilize two digits to define an applicable year rather than using
four digits. The Year 2000 issue results from the possibility that these systems
may read the "00" during the year 2000 as the year 1900. This problem effects
all companies and organizations using computerized information systems.

    American Bancorp, Inc. formed the "Y2K (Year 2000) Steering Committee" in
1997 to address the Year 2000 issue. The objectives of this committee were to
detail a plan of action for conversion of its computer applications to Year 2000
compliant applications, to ensure compliance with all "Federal Financial
Institutions Examination Council" ("FFIEC") regulations regarding the Year 2000,
and to ensure uninterrupted service to its customers. The Bank undertook an
extensive awareness campaign both internally and externally in an effort to
maintain heightened awareness of Year 2000 implications to its employees, Board
of Directors, suppliers and customers.

    The Bank developed a comprehensive inventory and risk assessment plan to
identify all systems and processes which could potentially be effected by the
century date change. Because core processing systems are acquired from third
party vendors, the Bank had very little control over the remediation of these
systems. However, the Bank maintained close contact with its core system and all
other vendors identified in the inventory and risk assessment, complying with
FFIEC guidelines regarding assessment of the status of these third party
vendor's Year 2000 readiness efforts. As of December 31, 1999, all of the Bank's
core processing systems had been replaced or upgraded with Year 2000 compliant
systems and software. All systems and processes have been tested.

    As of December 31, 1999, the Bank incurred costs related to the Year 2000
issue of approximately $10,000 and no additional expenditures are anticipated
for the 2000 fiscal year.


                                      -11-
<PAGE>   13

    THE DISCUSSION ABOVE ENTITLED "YEAR 2000," INCLUDES CERTAIN "FORWARD LOOKING
STATEMENTS" WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT
OF 1995 ("PSLRA"). THIS STATEMENT IS INCLUDED FOR THE EXPRESS PURPOSE OF
AVAILING AMERICAN BANCORP, INC. OF THE PROTECTIONS OF THE SAFE HARBOR PROVISIONS
OF THE PSLRA. MANAGEMENT'S ABILITY TO PREDICT RESULTS OR EFFECTS OF YEAR 2000
ISSUES IS INHERENTLY UNCERTAIN, AND IS SUBJECT TO FACTORS THAT MAY CAUSE ACTUAL
RESULTS TO DIFFER MATERIALLY FROM THOSE PROJECTED. FACTORS THAT COULD AFFECT THE
ACTUAL RESULTS INCLUDE THE POSSIBILITY THAT REMEDIATION EFFORTS AND CONTINGENCY
PLANS WILL NOT OPERATE AS INTENDED, THE COMPANY'S FAILURE TO TIMELY OR
COMPLETELY IDENTIFY ALL SOFTWARE AND HARDWARE APPLICATIONS REQUIRING
REMEDIATION, UNEXPECTED COSTS, AND THE UNCERTAINTY ASSOCIATED WITH THE IMPACT OF
YEAR 2000 ISSUES ON THE BANKING INDUSTRY AND ON THE COMPANY'S CUSTOMERS,
VENDORS, AND OTHERS WITH WHOM IT CONDUCTS BUSINESS. READERS ARE CAUTIONED NOT TO
PLACE UNDUE RELIANCE ON THESE FORWARD LOOKING STATEMENTS.


                                      -12-
<PAGE>   14

TABLE 1
SUMMARY OF CONSOLIDATED NET INTEREST INCOME
Fully taxable equivalent basis (In thousands)

<TABLE>
<CAPTION>
                                                                    1999
                                                    -------------------------------------
                                                     AVERAGE                     AVERAGE
                                                     BALANCE       INTEREST       RATE
                                                     -------       --------     ---------
<S>                                                 <C>           <C>           <C>
ASSETS
  Short-term investments                              $  9,782   $      492        5.03%
  Loans, net of unearned income (1) (2)                 26,880        2,450        9.11
  Securities available for sale (1) (3)                 28,672        1,781        6.21
  Securities held to maturity                            4,689          288        6.14
                                                    ----------   ----------
       Total interest earning assets                    70,023        5,011        7.16%
  Allowance for possible loan losses                      (592)  ----------   ---------
  Cash and due from banks                                4,912
  Other assets                                           2,109
                                                    ----------
       Total assets                                 $   76,452
                                                    ==========

LIABILITIES
   Interest-bearing demand deposits                 $   10,838   $      211        1.95%
   Savings deposits                                      9,714          263        2.71
   Time deposits                                        22,030        1,038        4.71
   Short-term borrowings                                    --           --          --
                                                    ----------   ----------
       Total interest-bearing liabilities               42,582        1,512        3.55%
                                                                 ----------   ---------
   Non-interest bearing demand deposits                 23,962
   Other liabilities                                       372
                                                    ----------
       Total liabilities                                66,916

SHAREHOLDERS' EQUITY
   Shareholders' equity                                  9,536
                                                    ----------
       Total liabilities and shareholders' equity   $   76,452
                                                    ==========

   Total interest expense related to earning assets                                2.16%
                                                                              ---------

   Net interest income                                           $    3,499
                                                                 ==========

   Net interest margin
                                                                                   5.00%
                                                                             ==========
</TABLE>

(1)  Interest income earned on nontaxable investment securities and certain
     loans are exempt from taxation. However, an adjustment has been made for
     the tax preference item related to nontaxable securities purchased after
     December 31, 1982. An incremental tax rate of 34% is used to compute the
     taxable equivalent adjustment for 1999, 1998, and 1997.

(2)  For purposes of yield computations, non-accrual loans are included in loans
     outstanding.

(3)  Yield computations are based on historical cost of securities available for
     sale.


                                      -13-
<PAGE>   15

<TABLE>
<CAPTION>
                 1998                                    1997
 -------------------------------------   -------------------------------------
  AVERAGE                     AVERAGE     AVERAGE                     AVERAGE
  BALANCE       INTEREST       RATE       BALANCE       INTEREST       RATE
  -------       --------     ---------    -------       --------     ---------
<S>            <C>         <C>           <C>            <C>          <C>
 $  5,732       $    309       5.39%      $  4,612     $    251          5.44%
   28,548          2,639       9.24         27,797        2,572          9.25
   19,113          1,237       6.47         10,922          756          6.92
    9,092            585       6.43         15,270          977          6.40
 --------       --------                  --------     --------
   62,485          4,770       7.63%        58,601        4,556          7.77%
     (602)      --------   --------           (604)    --------      --------
    4,093                                    3,963
    2,496                                    2,424
 --------                                 --------
 $ 68,472                                 $ 64,384
 ========                                 ========



 $ 11,104       $    216       1.95%      $ 11,752     $    229          1.95%
    9,223            250       2.71          8,374          227          2.71
   19,747            978       4.95         19,003          941          4.95
       29              2       6.90             --           --            --
 --------       --------                  --------      -------
   40,103          1,446       3.61%        39,129        1,397          3.57%
   19,070       --------   --------         16,846      -------      --------
      357                                      310
 --------                                 --------
   59,530                                   56,285

    8,942                                    8,099
 --------                                 --------
 $ 68,472                                 $ 64,384
 ========                                 ========
                               2.31%                                     2.38%
                           --------                                  --------
                $  3,324                               $  3,159
                ========                               ========
                               5.32%                                     5.39%
                           ========                                  ========
</TABLE>


                                      -14-
<PAGE>   16

TABLE 2
RATE/VOLUME ANALYSIS
Fully taxable equivalent basis (In thousands)

<TABLE>
<CAPTION>
                                                          YEAR ENDED DECEMBER 31,
                                              ----------------------------------------
                                                                1999/1998
                                              ----------------------------------------
                                                 INCREASE (DECREASE)
                                                 DUE TO CHANGE IN: (1)
                                              ------------------------
                                               AVERAGE        AVERAGE           NET
                                               BALANCE         RATE           CHANGE
                                              ---------      ---------       ---------
<S>                                          <C>             <C>             <C>
Interest income:
   Short-term investments ..................    $ 211          $ (28)          $ 183
   Loans, net of unearned income (2) .......     (153)           (36)           (189)
   Securities available for sale (3) .......      606            (62)            544
   Securities held to maturity .............     (277)           (20)           (297)
                                                -----          -----           -----
      Total interest income ................      387           (146)            241
                                                -----          -----           -----
Interest expense:
   Demand deposits .........................       (5)            --              (5)
   Savings deposits ........................       13             --              13
   Time deposits ...........................      108            (50)             58
   Short-term borrowing ....................       --             --              --
                                                -----          -----           -----
      Total interest expense ...............      116            (50)             66
                                                -----          -----           -----

Taxable-equivalent net interest income .....    $ 271          $ (96)          $ 175
                                                =====          =====           =====
</TABLE>


(1)   The change in interest due to both rate and volume has been allocated to
      rate and volume changes in proportion to the relationship of the absolute
      dollar amounts of the change in each.

(2)   Non-accrual loans are included in loans outstanding.

(3)   Yield computations are based on historical cost of securities available
      for sale.

                                      -15-

<PAGE>   17



<TABLE>
<CAPTION>
             YEAR ENDED DECEMBER 31,
 ----------------------------------------
                   1998/1997
 ----------------------------------------
    INCREASE (DECREASE)
    DUE TO CHANGE IN: (1)
 ------------------------
  AVERAGE        AVERAGE           NET
  BALANCE         RATE           CHANGE
 ---------      ---------       ---------
 <S>           <C>             <C>
   $  61          $ (3)          $  58
      69            (2)             67
     549           (68)            481
    (396)            4            (392)
   -----          ----           -----
     283           (69)            214
   -----          ----           -----


     (13)           --             (13)
      23            --              23
      37            --              37
       1             1               2
   -----          ----           -----

      48             1              49
   -----          ----           -----

   $ 235          $(70)          $ 165
   =====          ====           =====
</TABLE>


                                      -16-
<PAGE>   18

TABLE 3
SECURITIES PORTFOLIO
(In thousands)

<TABLE>
<CAPTION>
                                             DECEMBER 31, 1999                         DECEMBER 31, 1998
                                   -------------------------------------   -------------------------------------
                                    HELD TO       AVAILABLE                  HELD TO       AVAILABLE
                                   MATURITY       FOR SALE        TOTAL     MATURITY       FOR SALE       TOTAL
                                   --------       ---------     --------   ---------      ----------    ---------
<S>                                <C>             <C>           <C>       <C>            <C>          <C>
U.S. Treasury .................    $ 2,300         $ 3,501       $ 5,801     $ 2,696        $ 3,553      $ 6,249
U.S. Government and
   Agencies ...................        500          12,536        13,036       3,005          9,002       12,007
Mortgage-Backed
   Securities .................         --           6,931         6,931          --          4,455        4,455
State and Political
   Subdivisions ...............         --           8,306         8,306          --          6,907        6,907
Equity Securities .............         --             149           149          --             97           97
                                   -------         -------       -------     -------        -------      -------
                                   $ 2,800         $31,423       $34,223     $ 5,701        $24,014      $29,715
                                   =======         =======       =======     =======        =======      =======
</TABLE>


                                      -17-
<PAGE>   19



                                      -18-
<PAGE>   20

TABLE 4
MATURITY DISTRIBUTION AND SECURITIES PORTFOLIO YIELDS
(In thousands)

<TABLE>
<CAPTION>
                                                            AFTER                   AFTER
                                                           ONE BUT                FIVE BUT
                                    WITHIN ONE           WITHIN FIVE             WITHIN TEN
                                     YEAR AMT.   YIELD    YEARS AMT.    YIELD     YEARS AMT.   YIELD
                                   -----------   -----   -----------    -----    -----------   -----
<S>                                <C>           <C>     <C>            <C>      <C>           <C>
December 31, 1999:
  Held to maturity:
    U.S. Treasury ................   $   200      4.54%     $ 2,100      5.44%   $    --          --%
    U.S. Government
      and Agencies ...............        --        --          500      6.43         --          --
                                     -------      ----      -------      ----    -------        ----

     Total held to maturity ......       200      4.54%       2,600      5.63%        --          --%
                                     -------      ----      -------      ----    -------        ----

Available for sale:
  U.S. Treasury ..................     3,501      5.75%          --        --%        --          --%
  U.S. Government
    and Agencies .................        --        --        9,635      6.12      2,901        6.62
  Mortgage-Backed
    Securities (2) ...............        --        --        2,004      6.04        444        5.61
  State and
    Political
    Subdivisions (1) .............       529      7.37        4,093      6.84      3,186        7.23
    Equity Securities ............       149        --           --        --         --          --
                                     -------      ----      -------      ----    -------        ----

     Total available for sale ....     4,179      5.96%      15,732      6.30%     6,531        6.85%
                                     -------      ----      -------      ----    -------        ----

     Total securities ............   $ 4,379      5.89%     $18,332      6.20%   $ 6,531        6.85%
                                     =======      ====      =======      ====    =======        ====
</TABLE>

(1)  Tax exempt yields are expressed on a fully taxable equivalent basis.

(2) Distributed by contractual maturity without regard to repayment schedules
or projected payments.


                                      -19-
<PAGE>   21

<TABLE>
<CAPTION>

    AFTER TEN               TOTAL
    YEARS AMT.   YIELD      AMOUNT     YIELD
    ----------  -------    --------   -------
<S>             <C>        <C>        <C>


      $    --        --%   $  2,300      5.36%

           --        --         500      6.43
      -------   -------    --------   -------

           --        --%      2,800      5.55%
      -------   -------    --------   -------


           --        --%      3,501      5.75%

           --        --      12,536      6.24

        4,483      6.58       6,931      6.36


          498      7.43       8,306      7.06
           --        --         149        --
      -------   -------    --------   -------

        4,981      6.66%     31,423      6.43%
      -------   -------    --------   -------

      $ 4,981      6.66%   $ 34,223      6.36%
      =======   =======    ========   =======
</TABLE>





                                      -20-

<PAGE>   22
TABLE 5
LOAN PORTFOLIO

The amounts of loans outstanding for the three years ended December 31, 1999 are
shown in the following table according to type of loan (in thousands).

<TABLE>
<CAPTION>

                                               1999        1998        1997
                                             --------    --------    --------
<S>                                          <C>         <C>         <C>
Commercial, financial and agricultural ...   $  7,326    $  7,666    $  7,549
Real Estate - Construction ...............        949          51         359
Real Estate - Mortgage ...................     15,809      15,361      15,543
Installment ..............................      4,748       4,981       4,984
                                             --------    --------    --------
        Total ............................     28,832      28,059      28,435
Less:
  Allowance for possible loan losses .....       (579)       (596)       (600)
  Unearned income ........................         --          --          --
                                             --------    --------    --------

                                             $ 28,253    $ 27,463    $ 27,835
                                             ========    ========    ========
</TABLE>



TABLE 6
LOAN MATURITY AND INTEREST RATE SENSITIVITY

The following table shows the amount of commercial, financial and agricultural
loans, real estate-construction loans and real estate mortgage loans, exclusive
of installment loans, outstanding as of December 31, 1999 which, based on
remaining scheduled repayments of principal, are due in the amounts indicated.
Also, the amounts due after one year are classified according to the sensitivity
to the changes in interest rates (in thousands).

<TABLE>
<CAPTION>
                                          ONE YEAR  OVER ONE
                                             OR        TO      OVER
                                          LESS (1)  5 YEARS   5 YEARS    TOTAL
                                          --------  --------  -------   -------
<S>                                       <C>       <C>       <C>       <C>
Maturity of Loans:
  Commercial, financial and
     agricultural .....................   $ 4,064   $ 2,180   $ 1,082   $ 7,326
  Real Estate - mortgage and
    construction ......................     3,080     3,816     9,862    16,758
                                          -------   -------   -------   -------

      Total ...........................   $ 7,144   $ 5,996   $10,944   $24,084
                                          =======   =======   =======   =======

Interest Rate Sensitivity of Loans:
  With predetermined interest rates ...   $ 4,648   $ 5,263   $ 7,419   $17,330
  With floating interest rates (2) ....     2,496       733     3,525     6,754
                                          -------   -------   -------   -------

      Total ...........................   $ 7,144   $ 5,996   $10,944   $24,084
                                          =======   =======   =======   =======
</TABLE>


(l) Includes demand loans, loans having no stated schedule of repayments and no
stated maturity, and overdrafts.

(2) The floating interest rate loans generally fluctuate according to a formula
based on a prime rate.




                                      -21-

<PAGE>   23

TABLE 7
NONPERFORMING ASSETS

Nonperforming assets include nonaccrual loans, loans which are contractually 90
days past due, restructured loans, and foreclosed assets. Restructured loans are
loans which, due to a deteriorated financial condition of the borrower, have a
below-market yield. Interest payments received on nonperforming loans are
applied to reduce principal if there is doubt as to the collectibility of the
principal; otherwise, these receipts are recorded as interest income. Certain
nonperforming loans that are current as to principal and interest payments are
classified as nonperforming because there is a question concerning full
collection of both principal and interest.

Nonperforming assets totaled $109,029 at year ended 1999, a $96,519 (47.0%)
decrease from the prior year. Nonperforming assets totaled $205,549 at December
31, 1998, which was a decrease of $179,580 (46.63%) from December 31, 1997. The
composition of nonperforming assets for the past three years are illustrated
below.

<TABLE>
<CAPTION>
                                            1999       1998       1997
                                          --------   --------   --------
<S>                                       <C>        <C>        <C>
Nonperforming loans:
  Loans on nonaccrual .................   $ 69,889   $144,797   $308,059
  Restructured loans which are not
    on nonaccrual .....................     39,140     60,751     70,170
                                          --------   --------   --------

      Total nonperforming loans .......    109,029    205,548    378,229


Other real estate and repossessed
   assets received in complete or
   partial satisfaction of loan
   obligations ........................         --          1      6,900
                                          --------   --------   --------

       Total nonperforming assets .....   $109,029   $205,549   $385,129
                                          ========   ========   ========


  Loans contractually past due 90
    days or more as to principal or
    interest but which are not on
    nonaccrual ........................   $  8,119   $ 14,718   $  8,649
                                          ========   ========   ========
</TABLE>



At December 31, 1999, the Bank has loans outstanding to multiple numbers of
borrowers engaged in the medical industry and the legal profession. The loans to
the medical industry were approximately $6,912,000, while the loans to the legal
profession were approximately $2,633,000. There were no significant
nonperforming loans outstanding in these two concentrations.




                                      -22-
<PAGE>   24


TABLE 8
ALLOWANCE FOR POSSIBLE LOAN LOSSES
(In Thousands)

<TABLE>
<CAPTION>
                                                                      YEAR ENDED DECEMBER 31,
                                                                     -------------------------
                                                                     1999      1998      1997
                                                                     -----     -----     -----
<S>                                                                  <C>       <C>       <C>

Beginning balance ..........................................         $ 596     $ 600     $ 614
                                                                     -----     -----     -----

Provision charged against income ...........................           -0-       -0-       -0-
                                                                     -----     -----     -----

Charge-offs:
  Commercial, financial and agricultural loans .............           (13)       --        (1)
  Real estate mortgage loans ...............................            --        --        --
  Real estate construction loans ...........................            --        --        --
  Installment loans ........................................            (7)      (15)      (16)
                                                                     -----     -----     -----
    Total charge-offs ......................................           (20)      (15)      (17)
                                                                     -----     -----     -----

Recoveries:
  Commercial, financial and agricultural loans .............            --        --        --
  Real estate mortgage loans ...............................            --        --        --
  Real estate construction loans ...........................            --        --        --
  Installment loans ........................................             3        11         3
                                                                     -----     -----     -----
      Total recoveries .....................................             3        11         3
                                                                     -----     -----     -----

Net (charge-offs) recoveries ...............................           (17)       (4)      (14)
                                                                     -----     -----     -----

Ending balance .............................................         $ 579     $ 596     $ 600
                                                                     =====     =====     =====

Ratio of net (charge-offs) recoveries during
  the period to average loans outstanding
  during the period ........................................          (.06)%    (.01)%    (.05)%
                                                                     =====     =====     =====
</TABLE>




                                      -23-
<PAGE>   25

TABLE 9
ALLOCATION FOR POSSIBLE LOAN LOSSES
(In thousands)

The allowance for possible loan losses has been allocated according to the
amount deemed to be reasonably necessary to provide for the possibility of
losses being incurred within the following categories of loans at the date
indicated.

<TABLE>
<CAPTION>
                                      DECEMBER 31, 1999         DECEMBER 31, 1998
                                   -----------------------   -----------------------
                                                % OF LOANS                % OF LOANS
                                               OUTSTANDING               OUTSTANDING
                                                 TO TOTAL                  TO TOTAL
                                   ALLOWANCE      LOANS      ALLOWANCE      LOANS
                                   ---------   -----------   ---------   -----------
<S>                                <C>         <C>           <C>         <C>

Commercial, financial and
   agricultural loans ........       $120         25.41%       $135         27.32%
Real estate construction .....          5          3.29           1           .18
Real estate mortgage loans ...        238         54.83         272         54.75
Installment loans ............        216         16.47         188         17.75
                                     ----        ------        ----        ------
                                     $579        100.00%       $596        100.00%
                                     ====        ======        ====        ======
</TABLE>



<TABLE>
<CAPTION>
                                    DECEMBER 31, 1997
                                 ------------------------
                                               % OF LOANS
                                              OUTSTANDING
                                               TO TOTAL
                                 ALLOWANCE       LOANS
                                 ---------    -----------
<S>                              <C>          <C>
Commercial, financial and
   agricultural loans ........     $218          26.55%
Real estate construction .....        5           1.27
Real estate mortgage loans ...       97          54.66
Installment loans ............      280          17.52
                                   ----         ------
                                   $600         100.00%
                                   ====         ======
</TABLE>





                                      -24-
<PAGE>   26

TABLE 10
DEPOSITS

       The following table presents the average balance and an average rate paid
on deposits (in thousands):

<TABLE>
<CAPTION>
                                                           DECEMBER 31,
                              ----------------------------------------------------------------
                                      1999                    1998                  1997
                              -------------------     -------------------     ----------------

                              Average      Average    Average      Average    Average    Average
                              Balance       Rate      Balance       Rate      Balance     Rate
                              -------      -------    -------      -------    -------    -------
<S>                           <C>          <C>        <C>          <C>        <C>        <C>

Non-interest bearing
  demand deposits .......     $23,962          --%    $19,070          --%    $16,846       --%
Interest bearing
  demand deposits .......      10,838        1.95      11,104        1.95      11,752     1.95
Savings deposits ........       9,714        2.71       9,223        2.71       8,374     2.71
Time deposits ...........      22,030        4.71      19,747        4.95      19,003     4.95
Short-term borrowings ...          --          --          29        6.90          --       --
                              -------                 -------                 -------

      Total .............     $66,544                 $59,173                 $55,975
                              =======                 =======                 =======
</TABLE>





TABLE 11
CERTIFICATES OF DEPOSIT OF $100,000 OR MORE, MATURITY DISTRIBUTION

The following table provides the maturities of time certificates of deposit of
the Bank in amounts of $100,000 or more (in thousands):

<TABLE>
<CAPTION>
                                                      DECEMBER 31,
                                             ----------------------------
                                              1999       1998       1997
                                             ------     ------     ------
<S>                                          <C>        <C>        <C>
Maturing in:
   3 months or less ....................     $3,076     $2,587     $2,289
   Over 3 months less than 6 months ....      1,084        920        700
   Over 6 months less than 12 months ...        458        500        300
   Over 12 months ......................         --         --        217
                                             ------     ------     ------

         Total .........................     $4,618     $4,007     $3,506
                                             ======     ======     ======
</TABLE>




                                      -25-
<PAGE>   27

TABLE 12
RISK-BASED CAPITAL
(In thousands)

<TABLE>
<CAPTION>
                                                            DECEMBER 31,
                                                      ----------------------
                                                        1999          1998
                                                      --------      --------
<S>                                                   <C>           <C>

Risk-weighted assets ..........................       $ 35,073      $ 33,315
                                                      ========      ========

Capital:
   Tier I .....................................       $ 10,022      $  9,153
   Tier II ....................................            438           416
                                                      --------      --------
      Total capital ...........................       $ 10,460      $  9,569
                                                      ========      ========

Ratios:
   Tier I capital to risk-weighted assets .....          28.57%        27.47%
   Tier II capital to risk-weighted assets ....           1.25          1.25
                                                      --------      --------
      Total capital to risk-weighted assets ...          29.82%        28.72%
                                                      ========      ========

   Leverage - Tier I capital to total
      average assets ..........................          13.11%        13.36%
                                                      ========      ========
</TABLE>



TABLE 13
RETURN ON EQUITY AND ASSETS

The following table shows consolidated operating and capital ratios for each of
the last three years:

<TABLE>
<CAPTION>
                                                           DECEMBER 31,
                                                  ----------------------------
                                                   1999       1998       1997
                                                  ------     ------     ------
<S>                                               <C>        <C>        <C>

Return on average total assets ...........         1.42%      1.47%      1.47%

Return on average shareholders' equity ...        11.38%     11.27%     11.70%

Dividend payout ratio ....................        15.74%     14.76%     13.92%

Average equity to average assets ratio ...        12.47%     13.06%     12.58%
</TABLE>




                                      -26-
<PAGE>   28

TABLE 14
INTEREST RATE SENSITIVITY ANALYSIS
DECEMBER 31, 1999
(In thousands)

<TABLE>
<CAPTION>
                                                                         RATES
                                                                 ---------------------
                                                   FORECAST      +200 BP       -200 BP
                                                   --------      -------       -------
<S>                                                <C>           <C>           <C>
Economic value at risk:
     Total assets ............................     $80,232
     Bank equity .............................     $ 9,468
     Market value of portfolio equity ........     $11,431       $10,643       $11,972
     Market value to book value
        of equity ............................        1.21          1.12          1.26
     Amount of change in market value of
        portfolio equity .....................                   $  (788)      $   541
     Percent change in market value of
        portfolio equity .....................                     (6.89)%        4.73%
     Total securities market value premium
        percentage ...........................       (2.47)%       (8.36)%        4.01%
     Net loans present value premium
        percentage ...........................         .80%        (1.99)%        3.63%
     Total deposits present value premium
        percentage ...........................        2.51%         4.48%         (.03)%

Earnings at risk:
     January 1 to December 31, 2000 -
         Interest margin on earning assets ...        4.91%         5.18%         4.64%
         Amount of change in interest
            margin on earning assets .........                       .27%         (.27)%
         Net interest income .................     $ 3,452       $ 3,647       $ 3,250
         Amount of change in net
            interest income ..................                   $   195       $  (202)
         Percent change in net interest
            income ...........................                      5.64%        (5.85)%
         Net income ..........................     $ 1,160       $ 1,290       $ 1,025
         Amount change in net income .........                   $   130       $  (135)
         Percent change in net income ........                     11.21%       (11.63)%
</TABLE>




                                      -27-
<PAGE>   29

              [BROUSSARD, POCHE, LEWIS & BREAUX, L.L.P. LETTERHEAD]


                          INDEPENDENT AUDITORS' REPORT



To the Shareholders and Board of Directors
American Bancorp, Inc.
Opelousas, Louisiana


We have audited the accompanying consolidated balance sheets of American
Bancorp, Inc. and subsidiary as of December 31, 1999 and 1998, and the related
consolidated statements of income, changes in shareholders' equity and cash
flows for each of the three years in the period ended December 31, 1999. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
American Bancorp, Inc. and subsidiary as of December 31, 1999 and 1998, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 1999, in conformity with generally
accepted accounting principles.



                                            /s/ BROUSSARD, POCHE, LEWIS & BREAUX


Lafayette, Louisiana
January 28, 2000


                                      -28-
<PAGE>   30

                             AMERICAN BANCORP, INC.

                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 1999 AND 1998


<TABLE>
<CAPTION>
                ASSETS                                     1999              1998
                                                       ------------      ------------

<S>                                                    <C>               <C>
Cash and due from banks ..........................     $  6,048,962      $  4,333,107

Federal funds sold ...............................        8,104,742         8,550,000
                                                       ------------      ------------

   Total cash and cash equivalents ...............       14,153,704        12,883,107

Interest-bearing deposits with banks .............        1,090,000         1,387,000

Securities held to maturity (estimated
   market values $2,771,757 and $5,744,057,
   respectively) .................................        2,799,634         5,700,657

Securities available for sale ....................       31,422,670        24,013,561

Loans, net of unearned income ($-0- and
   $-0-, respectively) ...........................       28,832,360        28,058,357
      Less: allowance for possible loan losses ...         (579,047)         (595,762)
                                                       ------------      ------------

                                                         28,253,313        27,462,595

Bank premises and equipment ......................        1,108,299         1,113,368

Other real estate, net of allowances of
   $-0- and $112,799, respectively ...............              -0-                 1

Accrued interest receivable ......................          616,515           608,776

Other assets .....................................          787,605           497,239
                                                       ------------      ------------

                                                       $ 80,231,740      $ 73,666,304
                                                       ============      ============
</TABLE>




See Notes to Consolidated Financial Statements.




                                      -29-
<PAGE>   31
<TABLE>
<CAPTION>
  LIABILITIES AND SHAREHOLDERS' EQUITY                    1999              1998
                                                     ---------------   ---------------
<S>                                                  <C>                <C>
LIABILITIES
Deposits:
  Non-interest bearing demand deposits ...........   $    23,803,087    $    21,026,282
  Interest bearing deposits:
    NOW accounts .................................        13,613,375         10,969,200
    Money Market accounts ........................         2,351,346          2,059,420
    Savings ......................................         9,399,019          9,159,284
    Time deposits $100,000 or more ...............         4,617,950          4,006,621
    Other time deposits ..........................        16,649,590         16,598,176
                                                     ---------------    ---------------
      Total deposits .............................        70,434,367         63,818,983

  Accrued interest payable .......................           132,163            144,268
  Other liabilities ..............................           159,535            257,546
                                                     ---------------    ---------------
      Total liabilities ..........................        70,726,065         64,220,797
                                                     ---------------    ---------------

SHAREHOLDERS' EQUITY
Common stock, $5 par value; 10,000,000
  shares authorized; 120,000 shares
  issued, 117,712 and
  118,449 shares outstanding, respectively .......           600,000            600,000
Surplus ..........................................         2,150,000          2,150,000
Retained earnings ................................         7,438,877          6,524,015
Accumulated other comprehensive income
  (loss), net of tax of $(285,291)
  and $131,975, respectively .....................          (553,801)           256,187
Treasury stock, 2,288 and 1,551 shares at
  cost, respectively .............................          (129,401)           (84,695)
                                                        ------------       ------------
    Total shareholders' equity ...................         9,505,675          9,445,507
                                                        ------------       ------------
                                                        $ 80,231,740       $ 73,666,304
                                                        ============       ============

</TABLE>
                                      -30-
<PAGE>   32
                             AMERICAN BANCORP, INC.

                        CONSOLIDATED STATEMENTS OF INCOME
                  Years Ended December 31, 1999, 1998 and 1997


<TABLE>
<CAPTION>
                                                     1999            1998            1997
                                                ------------    ------------   ------------
<S>                                             <C>             <C>            <C>
Interest income:
   Interest and fees on loans ...............   $  2,433,152    $  2,642,229   $  2,573,981
   Interest on investment securities-
      Taxable ...............................      1,556,496       1,478,482      1,509,350
      Tax-exempt ............................        338,148         226,872        147,928
   Federal funds sold .......................        411,878         240,724        208,636
   Deposits with banks ......................         79,744          68,220         42,634
                                                ------------    ------------   ------------
         Total interest income ..............      4,819,418       4,656,527      4,482,529

Interest expense:
   Interest on deposits .....................      1,511,660       1,445,816      1,397,264
                                                ------------    ------------   ------------

Net interest income .........................      3,307,758       3,210,711      3,085,265
Provision for possible loan losses ..........            -0-             -0-            -0-
                                                ------------    ------------   ------------
Net interest income after provision
   for possible loan losses .................      3,307,758       3,210,711      3,085,265
                                                ------------    ------------   ------------
Non-interest income:
   Service charges on deposit accounts ......        559,418         508,135        498,551
   Other ....................................        133,128         104,250        107,847
                                                ------------    ------------   ------------
         Total non-interest income ..........        692,546         612,385        606,398
                                                ------------    ------------   ------------
Non-interest expense:
   Salary and employee benefits .............      1,301,324       1,198,730      1,143,226
   Net occupancy expense ....................        287,674         293,939        295,030
   Equipment expense ........................        224,367         246,471        267,191
   Net cost (revenue) from other
      real estate ...........................        (40,434)            299           (610)
   Other ....................................        738,895         667,893        634,025
                                                ------------    ------------   ------------
         Total non-interest expense .........      2,511,826       2,407,332      2,338,862
                                                ------------    ------------   ------------
Income before income taxes ..................      1,488,478       1,415,764      1,352,801

Provision for income taxes ..................        402,933         407,896        405,265
                                                ------------    ------------   ------------
         Net income .........................   $  1,085,545    $  1,007,868   $    947,536
                                                ============    ============   ============
Net income per common share .................   $       9.21    $       8.47   $       7.90
                                                ============    ============   ============
</TABLE>
     See Notes to Consolidated Financial Statements.

                                      -31-
<PAGE>   33

                                      -32-
<PAGE>   34
                             AMERICAN BANCORP, INC.

           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
                  Years Ended December 31, 1999, 1998 and 1997

<TABLE>
<CAPTION>
                                                        COMMON        STOCK                            RETAINED
                                                        SHARES        AMOUNT          SURPLUS          EARNINGS
                                                       --------     ----------      ----------      ------------

<S>                                                    <C>          <C>             <C>             <C>
Balance, December 31, 1996 .......................        120,000   $    600,000    $  2,150,000    $  4,848,745
Comprehensive income
   Net income for 1997 ...........................             --             --              --         947,536
   Other comprehensive income, net of tax:
        Changes in unrealized holding gains
        (losses) on securities available
        for sale, net of tax of $51,729 ..........             --             --              --              --

        Total comprehensive income ...............             --             --              --              --

Purchase of treasury stock .......................             --             --              --              --
Dividends paid in 1997 ...........................             --             --              --        (132,000)
                                                     ------------   ------------    ------------    ------------
Balance, December 31, 1997 .......................        120,000        600,000       2,150,000       5,664,281
Comprehensive income .............................
   Net income for 1998 ...........................             --             --              --       1,007,868
   Other comprehensive income, net of tax:
        Changes in unrealized holding gains
        (losses) on securities available .........
        for sale, net of tax of $131,975 .........             --             --              --              --

        Total comprehensive income ...............             --             --              --              --

Purchase of treasury stock .......................             --             --              --              --
Dividends paid in 1998 ...........................             --             --              --        (148,134)
                                                     ------------   ------------    ------------    ------------
Balance, December 31, 1998 .......................        120,000        600,000       2,150,000       6,524,015
Comprehensive income
   Net income for 1999 ...........................             --             --              --       1,085,545
   Other comprehensive income, net of tax:
        Changes in unrealized holding gains
        (losses) on securities available
        for sale, net of tax of $(285,291) .......             --             --              --              --
                                                                                                              --
        Total comprehensive income ...............             --             --              --

Purchase of treasury stock .......................             --             --              --              --
Dividends paid in 1999 ...........................             --             --              --        (170,683)
                                                     ------------   ------------    ------------    ------------
Balance, December 31, 1999 .......................        120,000   $    600,000    $  2,150,000    $  7,438,877
                                                     ============   ============    ============    ============

<CAPTION>
                                                     ACCUMULATED
                                                        OTHER
                                                    COMPREHENSIVE     TREASURY       COMPREHENSIVE
                                                        INCOME          STOCK           INCOME           TOTAL
                                                     -------------   -----------     ------------    ------------
Balance, December 31, 1996 .......................   $     57,649    $         --    $         --    $  7,656,394
Comprehensive income
   Net income for 1997 ...........................             --              --         947,536         947,536
   Other comprehensive income, net of tax:
        Changes in unrealized holding gains
        (losses) on securities available
        for sale, net of tax of $51,729 ..........         42,768              --          42,768          42,768
                                                                                     ------------
        Total comprehensive income ...............             --              --    $    990,304              --
                                                                                     ============
Purchase of treasury stock .......................             --          (2,014)                         (2,014)
Dividends paid in 1997 ...........................             --              --                        (132,000)
                                                     ------------    ------------                    ------------
Balance, December 31, 1997 .......................      100, 417          (2,014)    $         --       8,512,684
Comprehensive income .............................
   Net income for 1998 ...........................
   Other comprehensive income, net of tax: .......             --              --       1,007,868       1,007,868
        Changes in unrealized holding gains
        (losses) on securities available .........
        for sale, net of tax of $131,975 .........       155,770               --         155,770         155,770
                                                                                     ------------
        Total comprehensive income ...............             --              --    $  1,163,638              --
                                                                                     ============
Purchase of treasury stock .......................             --         (82,681)                        (82,681)
Dividends paid in 1998 ...........................             --              --                        (148,134)
                                                     ------------    ------------                    ------------
Balance, December 31, 1998 .......................        256,187         (84,695)   $         --       9,445,507
Comprehensive income .............................
   Net income for 1999 ...........................             --              --       1,085,545       1,085,545
   Other comprehensive income, net of tax:
        Changes in unrealized holding gains
        (losses) on securities available
        for sale, net of tax of $(285,291) .......       (809,988)             --        (809,988)       (809,988)
                                                                                     ------------
        Total comprehensive income ...............             --              --    $    275,557              --
                                                                                     ============
Purchase of treasury stock .......................             --         (44,706)                        (44,706)
Dividends paid in 1999 ...........................
                                                               --            --                          (170,683)
Balance, December 31, 1999 .......................   ------------    ------------                    ------------
                                                     $   (553,801)   $   (129,401)                   $  9,505,675
                                                     ============    ============                    ============
</TABLE>
See Notes to Consolidated Financial Statements ...





                                      -33-
<PAGE>   35

                             AMERICAN BANCORP, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                  Years Ended December 31, 1999, 1998 and 1997

<TABLE>
<CAPTION>
                                                         1999                  1998                  1997
                                                   ---------------       ---------------       ---------------
OPERATING ACTIVITIES
<S>                                                <C>                   <C>                   <C>
   Net income ...............................      $     1,085,545       $     1,007,868       $       947,536
   Adjustments to reconcile net income
      to net cash provided by operating
      activities:
      Premium amortization, net of
         discount accretion on investment
         securities .........................              (49,466)                5,846                 8,294
      Depreciation ..........................              129,296               165,247               198,377
      (Gain) loss on disposal of assets .....                   --                    --                 9,862
      (Increase) decrease in assets:
         Other real estate owned ............                   --                 6,899                 6,900
         Accrued interest receivable ........               (7,739)               11,201               (52,194)
         Other assets .......................              126,902               (21,372)               (5,802)
      Increase (decrease) in liabilities:
         Accrued interest payable ...........              (12,105)               24,101                 1,192
         Other liabilities ..................              (98,011)               45,983                19,317
                                                   ---------------       ---------------       ---------------
            Net cash provided by operating
               activities ...................            1,174,422             1,245,773             1,133,482
                                                   ---------------       ---------------       ---------------
INVESTING ACTIVITIES
   (Increase) decrease in interest-bearing
      deposits with banks ...................              297,000              (693,000)              397,000
Proceeds from maturities
      of available for sale securities ......            5,421,738             4,364,835             1,689,443
   Proceeds from maturities
      of held to maturity securities ........            5,000,000             8,700,000             4,300,000
   Purchase of available for sale
      securities ............................          (14,008,754)          (15,951,986)           (5,177,099)
   Purchase of held to maturity
      securities ............................           (2,098,859)             (199,844)           (2,986,173)
   (Increase) decrease in loans .............             (790,718)              372,343               476,533
   Purchases of property and equipment ......             (124,227)              (51,206)              (99,249)
   Other ....................................                   --                (9,336)               (6,281)
                                                   ---------------       ---------------       ---------------
         Net cash used in investing
            activities ......................           (6,303,820)           (3,468,194)           (1,405,826)
                                                   ---------------       ---------------       ---------------
FINANCING ACTIVITIES
Increase (decrease) in liabilities:
  Demand deposits, transaction
    accounts and savings ....................            5,952,640             6,412,096            (3,830,567)
  Time deposits .............................              662,744             1,550,141               320,682
Dividends paid ..............................             (170,683)             (148,134)             (132,000)
Purchase of treasury stock ..................              (44,706)              (82,681)               (2,014)
                                                   ---------------       ---------------       ---------------
  Net cash provided by (used in)
    financing activities ....................            6,399,995             7,731,422            (3,643,899)
                                                   ---------------       ---------------       ---------------
Increase (decrease) in cash and cash
  equivalents ...............................            1,270,597             5,509,001            (3,916,243)

Cash and cash equivalents at
  beginning of year .........................           12,883,107             7,374,106            11,290,349
                                                   ---------------       ---------------       ---------------
Cash and cash equivalents at end
  of year ...................................      $    14,153,704       $    12,883,107       $     7,374,106
                                                   ===============       ===============       ===============
SUPPLEMENTAL DISCLOSURES
  Cash payments for:
    Interest expense ........................      $     1,523,315       $     1,308,437       $     1,396,072
                                                   ===============       ===============       ===============
    Income taxes ............................      $       363,552       $       410,200       $       433,000
                                                   ===============       ===============       ===============
</TABLE>
See Notes to Consolidated Financial Statements.


                                      -34-


<PAGE>   36

                             AMERICAN BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1. Accounting Policies

       American Bancorp, Inc. (the Company) and its subsidiary, American Bank
       and Trust Company (the Bank), follow generally accepted accounting
       principles and reporting practices applicable to the banking industry.
       Descriptions of significant accounting policies are summarized below:

       Description of business:

          The Company is a bank holding company headquartered in Opelousas,
          Louisiana, operating principally in the community banking business
          segment by providing banking services to commercial and retail
          customers through its wholly owned subsidiary, the Bank.

          The Bank is community oriented and focuses primarily on offering
          competitive commercial and consumer loan and deposit services to
          individuals and small to middle market businesses.

       Comprehensive income:

          The Company adopted Statement of Financial Accounting Standards No.
          130, "Reporting Comprehensive Income" (SFASNo. 130), effective January
          1, 1998 and has provided the required information for all periods
          presented. SFAS No. 130 establishes standards for reporting and
          display of comprehensive income and its major components.
          Comprehensive income includes net income and other comprehensive
          income which, in the case of the Company, includes only realized gains
          and losses on securities available-for-sale.

       Consolidation:

          The consolidated financial statements include the accounts of the
          respective parent Company and its subsidiary. All significant
          intercompany accounts and transactions have been eliminated.

       Cash and cash equivalents:

          For the purpose of reporting cash flows, cash and cash equivalents
          include cash in hand, amounts due from banks, and federal funds sold.
          Generally, federal funds are purchased or sold for one-day periods.

       Use of estimates:

          The preparation of financial statements in conformity with generally
          accepted accounting principles requires management to make estimates
          and assumptions that affect the amounts reported in the consolidated
          financial statements and accompanying notes. Actual results could
          differ from those estimates.

                                      -35-
<PAGE>   37

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

       Securities:

          Management determines the appropriate classification of debt
          securities (trading, available for sale, or held to maturity) at the
          time of purchase and re-evaluates this classification periodically.
          Securities classified as trading account assets are held for sale in
          anticipation of short-term market movements. Debt securities are
          classified as held to maturity when the Bank has the positive intent
          and ability to hold the securities to maturity. Securities not
          classified as held to maturity or trading are classified as available
          for sale.

          Securities classified as trading account assets are carried at market
          value and are included in short-term investments. Gains and losses,
          both realized and unrealized, are reflected in earnings as other
          operating income. Securities classified as held to maturity are stated
          at amortized costs. Securities classified as available for sale are
          stated at fair value, with unrealized gains and losses, net of tax,
          reported in shareholders' equity and included in other comprehensive
          income.

          The amortized cost of debt securities classified as held to maturity
          or available for sale is adjusted for amortization of premiums and
          accretion of discounts to maturity or, in the case of mortgage-backed
          securities, over the estimated life of the security. Amortization,
          accretion and accruing interest are included in interest income on
          securities using the level-yield method. Realized gains and losses,
          and declines in value judged to be other than temporary, are included
          in net securities gains (losses). The cost of securities sold is
          determined on the specific identification method.

       Loans:

          Loans that management has the intent and ability to hold for the
          foreseeable future or until maturity or pay-off are reported at their
          outstanding principal adjusted for any charge-offs, the allowance for
          loan losses and unearned income. Interest on loans and accretion of
          unearned income are computed by methods which approximate a level rate
          of return on recorded principal.

          Loan fees and costs associated with originating loans are recognized
          in the period in which they originate as the amounts involved are
          immaterial to the basic financial statements. The Company has adopted
          the policy of deferring all material loan fees and costs associated
          with originating loans as required by Statement of Financial
          Accounting Standards No. 91.

          Commercial loans are placed in nonaccrual status when, in management's
          opinion, there is doubt concerning full collectibility of both
          principal and interest. All commercial nonaccrual loans are considered
          to be impaired in accordance with SFAS No. 114, "Accounting by
          Creditors for Impairment of a Loan." Consumer loans are generally
          charged off when any payment of principal or interest is more than 120
          days delinquent. Interest payments received on nonaccrual loans are
          applied to principal if there is doubt as to the collectibility of the
          principal; otherwise, these receipts are recorded as interest income.
          A loan remains in nonaccrual status until it is current as to
          principal and interest, and the borrower demonstrates its ability to
          fulfill the contractual obligation.

                                      -36-
<PAGE>   38

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

       Allowance for possible loan losses:

          The allowance for possible loan losses is maintained to provide for
          possible losses inherent in the loan portfolio. The allowance related
          to loans that are identified as impaired is based on discounted cash
          flows, using the loan's initial effective interest rate, or the fair
          value of the collateral for certain collateral dependent loans.

          The allowance is based on management's estimate of future losses;
          actual losses may vary from the current estimate. The estimate is
          reviewed periodically, taking into consideration the risk
          characteristics of the loan portfolio, past loss experience, general
          economic conditions and other factors which deserve current
          recognition. As adjustments to the estimate of future losses become
          necessary, they are reflected as a provision for possible loan losses
          in current-period earnings. Actual loan losses are deducted from, and
          subsequent recoveries are added to, the allowance.

       Bank premises and equipment:

          Bank premises and equipment are stated at cost less accumulated
          depreciation. Depreciation is computed primarily by the straight-line
          method. Useful lives utilized for purposes of computing depreciation
          are as follows: buildings, 10 to 30 years; furniture and equipment, 3
          to 10 years. Maintenance, repairs and minor improvements are charged
          to operating expenses. Gains or losses on dispositions are reflected
          currently in the Statement of Income.

       Foreclosed assets:

          Foreclosed assets include real estate and other collateral acquired
          upon the default of loans and loans classified as in-substance
          foreclosures. A loan is classified as in-substance foreclosure when
          the Bank has taken possession of the collateral regardless of whether
          formal foreclosure proceedings have taken place. Foreclosed assets and
          excess bank-owned property are recorded at the fair value of the
          assets less estimated selling costs. Losses arising from the initial
          reduction of an outstanding loan amount to fair value are deducted
          from the allowance for loan losses. Losses arising from the transfer
          of bank premises and equipment to excess bank-owned property are
          charged to expense. A valuation reserve for foreclosed assets and
          excess bank-owned property is maintained for subsequent valuation
          adjustments on a specific-property basis. Income and expenses
          associated with foreclosed assets and excess bank-owned property prior
          to sale are included in current earnings.

       Income taxes:

          The Company files a consolidated federal income tax return with the
          subsidiary Bank. The Company accounts for income taxes using the
          liability method. Under this method, deferred tax assets and
          liabilities are based on the temporary differences between the
          financial reporting basis and tax basis of the Company's assets and
          liabilities at enacted tax rates expected to be in effect when such
          amounts are realized or settled.


                                      -37-
<PAGE>   39


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     Recent pronouncements:

          In February 1997, the Financial Accounting Standards Board ("FASB")
          issued Statement of Financial Accounting Standards ("SFAS") No. 128,
          "Earnings Per Share" and SFAS No. 129, "Disclosure of Information
          About Capital Structure" which are effective for quarters ending after
          December 15, 1997, and fiscal years ending after December 15, 1997,
          respectively. The implementation of these statements did not have a
          material effect on its results of operations or financial statement
          disclosures.

          In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive
          Income" and SFAS No. 131, "Disclosures About Segments of an Enterprise
          and Related Information." SFAS No. 130 establishes standards for
          reporting and display of comprehensive income in the financial
          statements. Comprehensive income is the total of net income and all
          other non-owner changes in equity. SFAS No. 131 requires that
          companies disclose segment data based on how management makes
          decisions about allocating resources to segments and measuring their
          performance. SFAS Nos. 130 and 131 are effective for 1998. Adoption of
          these standards did not have a material effect on the Company's
          financial statements, financial position or results of operations.

          In March 1998, the Accounting Standards Executive Committee of the
          American Institute of Certified Public Accountants issued Statement of
          Position (SOP) 98-1, "Accounting for the Cost of Computer Software
          Developed or Obtained for Internal Use." SOP 98-1 is effective for
          financial statements for years beginning after December 15, 1998. The
          adoption of SOP 98-1 did not have a material impact on the financial
          condition or operating results of the Company.

          In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
          Instruments and Hedging Activities," which is effective for financial
          statements for years beginning after June 15, 1999. Because of the
          limited use of derivatives, management does not anticipate that the
          adoption of SFAS No. 133 will have a material impact on the financial
          condition or operating results of the Company. The Company expects to
          adopt this accounting standard on January 1, 2000.

          In December 1998, the FASB issued No. 134, "Accounting for
          Mortgage-Backed Securities Retained After the Securitization of
          Mortgage Loans Held for Sale by a Mortgage Banking Enterprise," which
          is effective for financial statements beginning after December 15,
          1998. In February 1999, the FASB issued No. 135, "Recession of
          FASB Statement No. 75 and Technical Corrections," which is effective
          for fiscal years ending after February 15, 1999. Adoption of these
          standards did not have a material effect on the Company's financial
          statements, financial position or results of operations.

          In June 1999, the FASB issued No. 136, "Transfers to Assets to a
          Not-for-Profit Organization or Charitable Trust that Raises or Holds
          Contributions for Others," which is effective for fiscal years
          beginning after June 15, 1999. The FASB issued No. 137, "Accounting
          for Derivative Instruments and Hedging Activities-Deferral of the
          Effective Date of FASB Statement No. 133," in June 1999. This
          statement is effective for all fiscal quarters of all fiscal years
          beginning after June 15, 2000. Adoption of these standards is not
          expected to have a material effect on the Company's financial
          statements, financial position or results of operations.


                                      -38-
<PAGE>   40


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     Reclassifications:

          Certain amounts in the 1998 and 1997 financial statements have been
          reclassified to conform with the financial statement presentation for
          1999 for comparability. These reclassifications had no effect on net
          income as previously reported for the 1998 and 1997 fiscal years.

Note 2. Restrictions on Cash and Due From Bank Accounts

          The Bank is required to maintain average reserve balances by the
          Federal Reserve Bank. The average amount of these reserve balances was
          $731,000 and $632,000 for the years ended December 31, 1999 and 1998,
          respectively.

Note 3. Investment Securities

          The carrying amounts of investment securities as shown in the
          consolidated balance sheets of the Bank and their approximate market
          values at December 31 were as follows:

<TABLE>
<CAPTION>
                                                              DECEMBER 31, 1999
                                              -----------------------------------------------------
                                               AMORTIZED    UNREALIZED    UNREALIZED       FAIR
                                                 COST          GAINS        LOSSES         VALUE
                                              -----------   -----------   -----------   -----------
<S>                                           <C>           <C>           <C>           <C>
Securities held to maturity:
   U.S. Treasury Securities ............      $ 2,299,634   $        --   $    24,132   $ 2,275,502
   U.S. Government and Agencies ........          500,000            --         3,745       496,255
                                              -----------   -----------   -----------   -----------
                                              $ 2,799,634   $       -0-   $    27,877   $ 2,771,757
                                              ===========   ===========   ===========   ===========

Securities available for sale:
   Mortgage-Backed Securities ..........      $ 7,146,769   $    19,315   $   235,394   $ 6,930,690
   U.S. Treasury Securities ............        3,503,378         1,832         3,955     3,501,255
   U.S. Government and Agencies ........       12,912,224            --       376,686    12,535,538
   State and Political Subdivisions ....        8,549,991         5,551       249,755     8,305,787
   Equity Securities ...................          149,400            --            --       149,400
                                              -----------   -----------   -----------   -----------
                                              $32,261,762   $    26,698   $   865,790   $31,422,670
                                              ===========   ===========   ===========   ===========
</TABLE>


                                      -39-
<PAGE>   41


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 3. Investment Securities (continued)

<TABLE>
<CAPTION>
                                                                 DECEMBER 31, 1998
                                                -----------------------------------------------------
                                                 AMORTIZED    UNREALIZED    UNREALIZED       FAIR
                                                    COST         GAINS        LOSSES         VALUE
                                                -----------   -----------   -----------   -----------
<S>                                             <C>           <C>           <C>           <C>
Securities held to maturity:
   U.S. Treasury Securities .................   $ 2,695,449   $    22,691   $       838   $ 2,717,302
   U.S. Government and Agencies .............     3,005,208        21,547            --     3,026,755
                                                -----------   -----------   -----------   -----------
                                                $ 5,700,657   $    44,238   $       838   $ 5,744,057
                                                ===========   ===========   ===========   ===========

Securities available for sale:
   Mortgage-Backed Securities ...............   $ 4,425,163   $    45,982   $    15,760   $ 4,455,385
   U.S. Treasury Securities .................     3,508,363        44,545            --     3,552,908
   U.S. Government and Agencies .............     8,932,763        71,699         2,810     9,001,652
   State and Political Subdivisions .........     6,662,209       254,273         9,766     6,906,716
   Equity Securities ........................        96,900            --            --        96,900
                                                -----------   -----------   -----------   -----------
                                                $23,625,398   $   416,499   $    28,336   $24,013,561
                                                ===========   ===========   ===========   ===========
</TABLE>


Securities with book values of $12,222,416 and $11,604,616 at December 31, 1999
and 1998, respectively, were pledged to secure public deposits and other
transactions as required by law.

There were no gross-realized gains or gross-realized losses on sales of
securities for the fiscal years ended December 31, 1999, 1998 or 1997.


                                      -40-
<PAGE>   42


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     The maturities of investment securities at December 31, 1999 were as
     follows:

<TABLE>
<CAPTION>
                                                 SECURITIES TO BE HELD
                                                      TO MATURITY
                                                ------------------------
                                                AMORTIZED       FAIR
YEARS TO MATURITY                                  COST         VALUE
                                                -----------  -----------
<S>                                             <C>          <C>
Less than one ...............................   $   199,926  $   197,626
Greater than one but less than five .........     2,599,708    2,574,131
Greater than five but less than ten .........            --           --
Greater than ten ............................            --           --
                                                -----------  -----------
                                                $ 2,799,634  $ 2,771,757
                                                ===========  ===========
</TABLE>

<TABLE>
<CAPTION>
                                                 SECURITIES AVAILABLE
                                                       FOR SALE
                                                ------------------------
                                                 AMORTIZED     FAIR
YEARS TO MATURITY                                  COST        VALUE
                                                -----------  -----------
<S>                                             <C>          <C>
Less than one ...............................   $ 4,032,618  $ 4,030,331
Greater than one but less than five .........    16,103,167   15,732,159
Greater than five but less than ten .........     6,814,193    6,530,121
Greater than ten ............................     5,311,784    5,130,059
                                                -----------  -----------
                                                $32,261,762  $31,422,670
                                                ===========  ===========
</TABLE>

Note 4. Loans

     Major classifications of subsidiary Bank's loan portfolio at December 31,
     are as follows:

<TABLE>
<CAPTION>
                                     1999            1998
                                 ------------    ------------
<S>                              <C>             <C>
Commercial, financial and
   agricultural ..............   $  7,325,960    $  7,666,021
Real estate construction .....        948,827          50,622
Real estate mortgage .........     15,808,978      15,361,086
Installment ..................      4,748,595       4,980,628
                                 ------------    ------------
                                   28,832,360      28,058,357

Unearned income ..............             --              --
                                 ------------    ------------
   Net loans .................     28,832,360      28,058,357

Allowance for possible loan
   losses ....................       (579,047)       (595,762)
                                 ------------    ------------
                                 $ 28,253,313    $ 27,462,595
                                 ============    ============
</TABLE>


                                      -41-
<PAGE>   43


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     The following is a summary of loans classified by type at December 31, 1999
     and 1998:

<TABLE>
<CAPTION>
                                1999         1998
                            -----------   -----------
<S>                         <C>           <C>
Commercial, financial and
   agricultural .........   $ 7,325,960   $ 7,666,021
Real estate construction        948,827        50,622
Real estate mortgage ....     7,991,175     8,164,528
                            -----------   -----------
   Total commercial .....    16,265,962    15,881,171
                            -----------   -----------
Residential mortgage ....     7,817,803     7,196,558
Installment .............     4,748,595     4,980,628
                            -----------   -----------
   Total consumer .......    12,566,398    12,177,186
                            -----------   -----------
   Total loans ..........   $28,832,360   $28,058,357
                            ===========   ===========
</TABLE>

     The following summarizes the non-performing elements of the loan portfolio
     and total foreclosed assets at December 31:

<TABLE>
<CAPTION>
                                                       1999       1998       1997
                                                     --------   --------   --------
<S>                                                  <C>        <C>        <C>
Nonperforming loans:
   Loans on nonaccrual ...........................   $ 69,889   $144,797   $308,059
   Restructured loans which
      are not on nonaccrual ......................     39,140     60,751     70,170
                                                     --------   --------   --------
               Total nonperforming loans .........    109,029    205,548    378,229

Other real estate and
   repossessed assets received
   in complete or partial
   satisfaction of loan
   obligations ...................................         --          1      6,900
                                                     --------   --------   --------
                Total nonperforming assets .......   $109,029   $205,549   $385,129
                                                     ========   ========   ========
 Loans contractually past
      due 90 days or more as
      to principal or interest,
      but which are not on
      nonaccrual .................................   $  8,119   $ 14,718   $  8,649
                                                     ========   ========   ========
</TABLE>


                                      -42-
<PAGE>   44


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

At December 31, 1999, the recorded investment in loans that were considered to
be impaired under SFAS No. 114 was $69,889. Included in this amount was $64,000
of the impaired loans for which the related allowance for loan losses was
$10,000 and $5,889 of impaired loans that do not have an allowance for loan
losses. The average recorded investment in impaired loans during the year ended
December 31, 1999 was approximately $52,000. Interest payments received on
impaired loans are applied to principal if there is doubt as to the
collectibility of the principal; otherwise, these receipts are recorded as
interest income. For the year ended December 31, 1999, the Company did not
recognized income on impaired loans.

Interest income in the amount of $9,501 for 1999, $32,424 for 1998 and $53,417
for 1997 would have been recorded on nonperforming loans if they had been
classified as performing. The Company recorded $2,733, $4,796 and $5,621 of
interest income on nonperforming loans during 1999, 1998 and 1997, respectively.

     The following is a summary of the allowance for loan losses for the three
     years ended December 31, 1999:

<TABLE>
<CAPTION>
                                      1999            1998           1997
                                    ---------      ---------      ---------
<S>                                 <C>            <C>            <C>
Balance, beginning of year ....     $ 595,762      $ 599,593      $ 614,339
Provisions charged to operating
   expense ....................            --             --             --
Recoveries on loans ...........         2,938         11,370          2,250
Loans charged off .............       (19,653)       (15,201)       (16,996)
                                    ---------      ---------      ---------
Balance, end of year ..........     $ 579,047      $ 595,762      $ 599,593
                                    =========      =========      =========
</TABLE>

Note 5. Related Party Transactions

     In the ordinary course of business, loans have been made to directors and
     executive officers and their associates. Such loans to these related
     parties were made on substantially the same terms, including interest rates
     and collateral, as those prevailing at the time for comparable transactions
     with other persons. Loans to these related parties were approximately
     $2,291,812 and $1,400,278 at December 31, 1999 and 1998, respectively. The
     following provides an analysis of the activity with respect to loans to
     related parties:

<TABLE>
     <S>                                     <C>
     Balance at January 1, 1999 ........     $ 1,400,278
     New loans made ....................       2,601,001
     Repayment on loans ................      (1,709,467)
                                             -----------
     Balance at December 31, 1999 ......     $ 2,291,812
                                             ===========
</TABLE>


                                      -43-
<PAGE>   45


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 6. Bank Premises and Equipment

     Bank premises and equipment, at cost, consisted of the following as of
     December 31:

<TABLE>
<CAPTION>
                                     1999           1998           1997
                                  ----------     ----------     ----------
<S>                               <C>            <C>            <C>
Land ........................     $  384,387     $  384,387     $  384,387
Premises and leasehold
   improvements .............      1,811,929      1,789,144      1,788,590
Furniture and equipment .....      1,242,411      1,216,548      1,228,258
Construction in progress ....         52,704             --             --
                                  ----------     ----------     ----------
                                   3,491,431      3,390,079      3,401,235
Less accumulated depreciation
   and amortization .........      2,383,132      2,276,711      2,173,826
                                  ----------     ----------     ----------
     Total ..................     $1,108,299     $1,113,368     $1,227,409
                                  ==========     ==========     ==========
</TABLE>

     Depreciation and amortization expense included in non-interest expense was
     $129,296 in 1999, $165,247 in 1998, and $198,377 in 1997.

Note 7. Deposits

     Deposit account balances at December 31, 1999 and 1998, are summarized as
     follows:

<TABLE>
<CAPTION>
                               1999            1998
                            -----------     -----------
<S>                         <C>             <C>
Non-interest bearing ..     $23,803,087     $21,026,282
Interest bearing demand      15,964,721      13,028,620
Savings deposits ......       9,399,019       9,159,284
Time deposits .........      21,267,540      20,604,797
                            -----------     -----------
                            $70,434,367     $63,818,983
                            ===========     ===========
</TABLE>

     Time deposits maturing in years ending December 31, as of December 31,
     1999:

<TABLE>
<S>               <C>
2000 .........    $19,796,299
2001 .........      1,207,886
2002 .........        263,355
                  -----------
                  $21,267,540
                  ===========
</TABLE>

     The Bank held related party deposits of approximately $1,572,000 and
     $1,697,000 at December 31, 1999 and 1998.


                                      -44-
<PAGE>   46


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8. Employee Benefit Plan

     The Bank maintains a 401(k) Savings Plan available to employees with over
     one year of service. The Bank matches 50% of the salary deferral, up to a
     maximum of 3% of compensation for 1999 and 1998, which becomes vested after
     five years of service. Total contributions to the plan by the Bank were
     $19,735 for 1999 and $30,528 for 1998. The Bank entered into a
     non-qualified deferred compensation plan for certain executives of the
     Company in 1995. The total deferred compensation expense for 1999 and 1998
     was $12,384 and $11,574, respectively.

Note 9. Lease Commitments

     The Company leases land, buildings, and equipment under cancelable and
     noncancelable leases. The leased properties are used primarily for banking
     purposes.

     Future minimum payments, by year and in the aggregate, for noncancelable
     operating leases with initial or remaining terms of one year or more
     consisted of the following at December 31, 1999:

<TABLE>
<CAPTION>
 Year Ending                                              Amount
-------------                                           ----------

    <S>                                                <C>
    2000 ..........................................    $    68,360
    2001 ..........................................         45,871
    2002 ..........................................         45,871
    2003 ..........................................         40,771
    2004 ..........................................         35,671
                                                        ----------
    Total future minimum lease payments                 $  236,544
                                                        ==========
</TABLE>

     All leases contain options to extend the lease term upon expiration and
     will probably be exercised.

     The total rental expense on operating leases for the years ended December
     31, 1999, 1998, and 1997, amount to $68,360, $63,409 and $60,096,
     respectively.

     One of the bank's branch offices is leased from a corporation which is
     owned by a shareholder and director of the Bank. Lease expense related to
     this property totaled $20,671 for the 1999 fiscal year.


                                      -45-
<PAGE>   47


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 10. Other Operating Expenses

     The composition of other operating expenses for each of the three years for
     the period ended December 31 are as follows:

<TABLE>
<CAPTION>
                                          1999         1998         1997
                                        --------     --------     --------
<S>                                     <C>          <C>          <C>
FDIC and Louisiana assessments ....     $ 26,948     $ 24,707     $ 21,636
Advertising .......................       56,479       63,622       26,670
Office supplies ...................       82,594       70,465       79,418
Postage ...........................       57,560       56,269       52,202
Other insurance ...................       15,503       12,727       16,390
ATM expenses ......................       35,940       27,029       25,803
Director fees .....................       92,650       87,700       89,750
Other .............................      371,221      325,374      322,156
                                        --------     --------     --------

                                        $738,895     $667,893     $634,025
                                        ========     ========     ========
</TABLE>

Note 11. Income Taxes

     The Company adopted SFAS No. 109 effective January 1, 1992. Income tax
     expense includes amounts currently payable and amounts deferred to or from
     other years as a result of differences in the timing of recognition of
     income and expense for financial reporting and deferral tax purposes. The
     components of income tax expense are as follows:

<TABLE>
<CAPTION>
                                        1999           1998            1997
                                      ---------      ---------      ---------
<S>                                   <C>            <C>            <C>
Current federal income tax
   expense ......................     $ 376,331      $ 418,969      $ 408,433
Deferred federal income tax
   expense (benefit) ............        26,602        (11,073)        (3,168)
                                      ---------      ---------      ---------
                                      $ 402,933      $ 407,896      $ 405,265
                                      =========      =========      =========
Included in shareholders' equity:
   Deferred tax expense
  (benefit) related to the
  change in net unrealized
  gain (loss) on securities
  available for sale ............     $(417,266)     $  80,246      $  22,031
                                      =========      =========      =========
</TABLE>


                                      -46-
<PAGE>   48


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     The reconciliation of the federal statutory income tax rate to the
     Company's effective rate is summarized as follows for the years ended
     December 31:

<TABLE>
<CAPTION>
                                        1999                      1998                       1997
                              ----------------------     ----------------------     ----------------------
                               AMOUNT           RATE      AMOUNT           RATE       AMOUNT          RATE
                              ---------         ----     ---------         ----     ---------         ----
<S>                           <C>               <C>      <C>               <C>      <C>               <C>
Tax based on
   federal
   statutory rate .......     $ 506,083         34.0%    $ 481,360         34.0%    $ 459,953         34.0%
Effect of tax-
   exempt income ........      (116,718)        (7.8)      (82,593)        (5.8)      (60,149)        (4.4)
Other ...................        13,568           .9         9,129           .6         5,461           .4
                              ---------         ----     ---------         ----     ---------         ----
                              $ 402,933         27.1%    $ 407,896         28.8%    $ 405,265         30.0%
                              =========         ====     =========         ====     =========         ====
</TABLE>

     Deferred tax assets and liabilities included in other assets or other
     liabilities at December 31 consist of the following:

<TABLE>
<CAPTION>
                                             1999          1998
                                           ---------     ---------
<S>                                        <C>           <C>
Deferred tax assets:
   Allowance for loan losses .........     $  14,022     $  14,022
   Foreclosed assets .................            --        38,352
   Deferred executive compensation ...        16,331        12,119
   Net unrealized loss on available
      for sale securities ............       285,291            --
 Other ...............................         5,141            --
                                           ---------     ---------
    Total deferred tax assets ........       320,785        64,493
                                           ---------     ---------
Deferred tax liabilities:
   Net unrealized appreciation
      on available for sale securities            --       131,975
   Accumulated depreciation ..........        28,322        30,719
                                           ---------     ---------
      Total deferred tax liabilities .        28,322       162,694
                                           ---------     ---------
Net deferred tax asset (liability) ...     $ 292,463     $ (98,201)
                                           =========     =========
</TABLE>

     Management estimates realizability of a deferred tax asset based on the
     Company's ability to generate taxable income in the future. A deferred tax
     valuation reserve is established, if needed, to limit the net deferred tax
     asset to its realizable value.

Note 12. Earnings Per Share

The earnings per share computations are based on weighted average number of
shares outstanding during each year of 117,884, 118,965 and 119,997 for the
years ended December 31, 1999, 1998 and 1997, respectively.


                                      -47-
<PAGE>   49
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 13. Financial Instruments

          Generally accepted accounting principles require disclosure of fair
          value information about financial instruments for which it is
          practicable to estimate fair value, whether or not the financial
          instruments are recognized in the financial statements. When quoted
          market prices are not available, fair values are based on estimates
          using present value or other valuation techniques. Those techniques
          are significantly affected by the assumptions used, including the
          discount rate and estimates of future cash flows. The derived fair
          value estimates cannot be substantiated through comparison to
          independent markets and, in many cases, could not be realized in
          immediate settlement of the instrument. Certain financial instruments
          and all non-financial instruments are excluded from these disclosure
          requirements. Further, the disclosures do not include estimated fair
          values for items which are not financial instruments but which
          represent significant value to the Bank, among them, core deposit
          intangibles, loan servicing rights and other fee-generating
          businesses. Accordingly, the aggregate fair value amounts presented do
          not represent the underlying value of the Company.

          The carrying amount of cash and short-term investments and demand
          deposits approximates the estimated fair value of these financial
          instruments. The estimated fair value of securities is based on quoted
          market prices, dealer quotes and prices obtained from independent
          pricing services. The estimated fair value of loans and interest
          bearing deposits is based on present values using applicable
          risk-adjusted spreads to the appropriate yield curve to approximate
          current interest rates applicable to each category of these financial
          instruments.

          Interest rates were not adjusted for changes in credit risk of
          performing commercial loans for which there are no known credit
          concerns. Management segregates loans into appropriate risk categories
          and believes the risk factor embedded in the interest rates results in
          a fair valuation of these loans on an entry-value basis.

          Variances between the carrying amount and the estimated fair value of
          loans reflect both credit risk and interest rate risk. The Bank is
          protected against changes in credit risk by the allowance for possible
          loan losses of $579,047 at December 31, 1999.

          The fair value estimates presented are based on information available
          to management as of December 31, 1999. Although management is not
          aware of any factors that would significantly affect the estimated
          fair value amounts, these amounts have not been revalued for purposes
          of these financial statements since that date. Therefore, current
          estimates of fair value may differ significantly from the amounts
          presented. None of the assets or liabilities included in the table
          below are held for trading purposes.

          The Bank issues financial instruments in the normal course of business
          to meet the financing needs of its customers and to reduce exposure to
          fluctuations in interest rates. These financial instruments include
          commitments to extend credit and letters of credit and involve, to
          varying degrees, elements of credit and interest rate risk in excess
          of the amount recognized on the balance sheet.

                                      -48-

<PAGE>   50


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>

                                                    CARRYING             FAIR
                                                     AMOUNT              VALUE
                                                   -----------       -----------
<S>                                                <C>                <C>
              ASSETS
  Cash equivalents.............................    $14,153,704       $14,153,704
  Interest-bearing deposits with banks.........    $ 1,090,000       $ 1,090,000
  Securities held to maturity..................    $ 2,799,634       $ 2,771,757
  Securities available for sale................    $31,422,670       $31,422,670
  Commercial loans.............................    $ 7,325,960       $ 7,264,750
  Consumer loans...............................    $ 4,748,595       $ 4,649,440
  Real estate loans............................    $16,757,805       $17,144,810

LIABILITIES
  Demand deposits..............................    $23,803,087       $23,803,087
  NOW accounts.................................    $13,613,375       $13,613,375
  Money market accounts........................    $ 2,351,346       $ 2,351,346
  Savings......................................    $ 9,399,019       $ 9,399,019
  Time Deposits................................    $21,267,540       $21,275,173
</TABLE>


          Commitments to extend credit are legally binding, conditional
          agreements generally having fixed expiration or termination dates and
          specified interest rates and purposes. These commitments generally
          require customers to maintain certain credit standards. Collateral
          requirements and loan-to-value ratios are the same as those for funded
          transactions and are established based on management's credit
          assessment of the customer. Commitments may expire without being drawn
          upon. Therefore, the total commitment amount does not necessarily
          represent future funding requirements. The Bank's experience has been
          that most loan commitments are drawn upon by customers. Outstanding
          loan commitments at December 31, 1999 were $4,303,248 and $4,902,427
          at December 31, 1998.

          The Bank issues letters of credit and financial guarantees (standby
          letters of credit) whereby it agrees to honor certain financial
          commitments in the event its customers are unable to perform. The
          majority of the standby letters of credit consist of performance
          guarantees. Management conducts regular reviews of all outstanding
          standby letters of credit, and the results of these reviews are
          considered in assessing the adequacy of the Bank's reserve for
          possible loan losses. The letters of credit balance was $307,116 and
          $153,007 at December 31, 1999 and 1998, respectively. The Bank has not
          incurred any losses in its commitments in 1999 or 1998. Management
          does not anticipate any material losses related to these instruments.



                                      -49-
<PAGE>   51

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          The estimated fair values of off-balance-sheet financial instruments
          are not material. A summary of the notional amounts of the Bank's
          financial instruments with off-balance-sheet risk at December 31, 1999
          and 1998 are as follows:

<TABLE>
<CAPTION>

                                                      1999               1998
                                                   ----------         ----------
<S>                                                <C>                <C>
Commitments to extend credit...................    $4,303,248         $4,902,427
Credit card arrangements.......................    $1,865,133         $1,902,592
Standby letters of credit......................    $  307,116         $  153,007
</TABLE>

Note 14. Regulatory Matters

          The Bank is subject to the dividend restrictions set forth by the
          Louisiana Commissioner of Financial Institutions. Under such
          restrictions, the Bank may not, without the prior approval of the
          Commissioner of Financial Institutions, declare dividends in excess of
          the sum of the current year and prior year earnings less dividends
          paid during these periods. The dividends as of December 31, 1999, that
          the Bank could declare without the approval of the Commissioner of
          Financial Institutions, amounted to $1,774,596. The Bank is also
          required to maintain minimum amounts of capital to total "risk
          weighted" assets, as defined by the banking regulators. At December
          31, 1999, the Bank is required to have minimum Tier 1 risk-based, Tier
          1 leverage capital, and Total capital ratios of 4%, 4% and 8%,
          respectively. The Bank's actual ratios at that date were 28.57%,
          13.11% and 29.82%, respectively. At December 31, 1998, the Bank's
          actual ratios were 27.47%, 13.36%, and 28.72%, respectively.

          Under Section 18J of the Federal Deposit Insurance Act, which is
          subject to Section 23A of the Federal Reserve Act, the Bank cannot
          make loans, extensions of credit, repurchase agreements, investments,
          and advances, which exceed 10 percent of its capital stock and
          surplus, to an affiliate. Such loans must be collateralized by assets
          with market values of 100% to 130% of loan amounts, depending upon the
          nature of the collateral.

          As of December 31, 1999 and 1998, the most recent notifications from
          the Federal Deposit Insurance Corporation categorized the Bank as well
          capitalized under the regulatory framework for prompt action. To be
          categorized as well capitalized, the Bank must maintain minimum Total
          risk-based, Tier 1 risk-based, and Tier 1 leverage ratios as indicated
          above. There are no conditions or events since those notifications
          that management believes have changed the Bank's category.

                                      -50-
<PAGE>   52

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 15. American Bancorp, Inc. (Parent Company Only)

          The following financial statements of American Bancorp, Inc. (Parent
          Company Only) include the Bank under the equity method of accounting.

BALANCE SHEETS
<TABLE>
<CAPTION>

                                                                   DECEMBER 31,
                                                        ------------------------------
                                                            1999               1998
                                                        ------------      ------------
<S>                                                     <C>               <C>
ASSETS
   Cash on deposit with subsidiary..................... $     32,370      $     30,816
   Investment in subsidiary............................    9,467,820         9,409,206
   Due from American Bank..............................       33,110            20,331
                                                        ------------      ------------

      Total assets.....................................    9,533,300      $  9,460,353
                                                        ============      ============
LIABILITIES
   Accrued income taxes payable........................ $     27,625      $     14,846
                                                        ------------      ------------

     Total liabilities.................................       27,625            14,846
                                                        ------------      ------------

SHAREHOLDERS' EQUITY
   Common stock: $5 par value, 10,000,000
      shares authorized; 120,000 shares
      issued, 117,712 and
      118,449 shares outstanding, respectively.........      600,000           600,000
   Surplus.............................................    2,150,000         2,150,000
   Retained earnings...................................    7,438,877         6,524,015
   Net unrealized loss on securities
      available for sale, net of tax of $(285,291)
      and $131,975, respectively.......................     (553,801)          256,187
   Treasury stock, 2,288 and 1,551 shares
    at cost, respectively..............................     (129,401)          (84,695)
                                                        ------------      ------------
         Total shareholders' equity....................    9,505,675         9,445,507
                                                        ------------      ------------

         Total liabilities and shareholders' equity.... $  9,533,300      $  9,460,353
                                                        ============      ============
</TABLE>


                                      -51-
<PAGE>   53

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

American Bancorp, Inc. (Parent Company Only)

STATEMENTS OF INCOME

<TABLE>
<CAPTION>

                                             YEARS ENDED DECEMBER 31,
                                      ----------------------------------------
                                         1999          1998             1997
                                      ----------     ----------     ----------
<S>                                   <C>            <C>            <C>
Income:
   Dividends from bank subsidiary.... $  230,000     $  216,134     $  185,000
                                      ----------     ----------     ----------

Expenses:
   Directors fees....................     12,000          8,400              -
   Other expenses....................      1,057            967            890
                                      ----------     ----------     ----------
                                          13,057          9,367            890
                                      ----------     ----------     ----------

Earnings before income taxes
   and equity in undistributed
   earnings of subsidiary............    216,943        206,767        184,110

Provision for income taxes...........          -              -              -
                                      ----------     ----------     ----------

Earnings before equity in
   undistributed earnings of
   subsidiary........................    216,943        206,767        184,110

Equity in undistributed
   earnings of subsidiary............    868,602        801,101        763,426
                                      ----------     ----------     ----------

      Net income..................... $1,085,545     $1,007,868     $  947,536
                                      ==========     ==========     ==========
</TABLE>



                                      -52-
<PAGE>   54


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

American Bancorp, Inc. (Parent Company Only)

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                           YEARS ENDED DECEMBER 31,
                                                 ---------------------------------------------
                                                    1999             1998              1997
                                                 -----------      -----------      -----------
<S>                                              <C>              <C>              <C>
OPERATING ACTIVITIES
   Net income..................................  $ 1,085,545      $ 1,007,868      $   947,536
   Adjustments to reconcile net
      income to net cash provided
      by operating activities:
         Equity in undistributed
            earnings of subsidiary.............     (868,602)        (801,101)        (763,426)
         (Increase) decrease in other assets...      (12,779)          (8,769)          24,567
       Increase (decrease) in income taxes
         payable...............................       12,779            8,769          (24,567)
                                                 -----------      -----------      -----------

            Net cash provided by
               operating activities............      216,943          206,767          184,110
                                                 -----------      -----------      -----------

FINANCING ACTIVITIES
   Dividends paid to shareholders..............     (170,683)        (148,134)        (132,000)
                                                 -----------      -----------      -----------

            Net cash used by
               financing activities............     (170,683)        (148,134)        (132,000)
                                                 -----------      -----------      -----------

INVESTING ACTIVITIES
   Purchase of treasury stock..................      (44,706)         (82,681)          (2,014)
                                                 -----------      -----------      -----------

           Net cash used by
              investing activities.............      (44,706)         (82,681)          (2,014)
                                                 -----------      -----------      -----------

          Increase (decrease) in cash
              and cash equivalents.............        1,554          (24,048)          50,096


Cash and cash equivalents at
   beginning of year...........................       30,816           54,864            4,768
                                                 -----------      -----------      -----------

Cash and cash equivalents at
   end of year.................................  $    32,370      $    30,816      $    54,864
                                                 ===========      ===========      ===========
</TABLE>


                                      -53-

<PAGE>   55


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 16. Concentrations of Credit Risk

          Substantially, all of the Bank's loans, commitments and standby
          letters of credit have been granted to customers in the Bank's market
          area of South Louisiana. Investments in state and municipal securities
          also involve governmental entities within the Bank's market area. The
          concentrations of credit by type of loan are set forth in Note 4. The
          distribution of commitments to extend credit approximates the
          distribution of loans outstanding. Standby letters of credit were
          granted primarily to commercial borrowers. The Bank, as a matter of
          policy, does not extend credit to any single borrower or group of
          related borrowers in excess of $1,375,000.

          At December 31, 1999, the Bank has loans outstanding to multiple
          numbers of borrowers engaged in the medical industry and the legal
          profession. The loans to the medical industry were approximately
          $6,912,000, while the loans to the legal profession were approximately
          $2,633,000. There were no significant nonperforming loans outstanding
          in these two concentrations.


Note 17. Contingencies

          In the ordinary course of business, the Bank has various outstanding
          commitments and contingent liabilities that are not reflected in the
          accompanying consolidated financial statements. In addition, the Bank
          is a defendant in certain claims and legal actions arising in the
          ordinary course of business. In the opinion of management, after
          consultation with legal counsel, the ultimate disposition of these
          matters is not expected to have a material adverse effect on the
          consolidated financial condition of the Bank.



                                      -54-
<PAGE>   56

                            OFFICERS AND DIRECTORS OF
                         AMERICAN BANK AND TRUST COMPANY

                       CHAIRMAN OF THE BOARD AND PRESIDENT
                             Salvador L. Diesi, Sr.

              CHIEF EXECUTIVE OFFICER AND EXECUTIVE VICE-PRESIDENT
                                Ronald J. Lashute

                              SENIOR VICE-PRESIDENT
                            Walter J. Champagne, Jr.

                                 VICE-PRESIDENTS

Charlene Louviere                                         Joan T. Muller, Chief
Angel Powell                                                Financial Officer,
Mark J. LeBlanc                                             Cashier


                            ASSISTANT VICE-PRESIDENTS

David Gremillion                                          Christopher Choate
J. Karla Manuel

                               ASSISTANT CASHIERS

Elaine D. Ardoin                                          Elizabeth Miller
Audrey Cormier                                            Bonnie Pavy
Sally Hooks                                               Stephanie Richard
Cindy Whitmore                                            Audrey Thibodeaux


                                    DIRECTORS

Jasper Artall                                             Salvador L. Diesi, Sr.
Walter J. Champagne, Jr.                                  Alvin Hayes II
Attaway Darbonne                                          Charles Jagneaux
J. C. Diesi                                               Sylvia Sibille


                               OFFICES LOCATED IN

OPELOUSAS                                                 KROTZ SPRINGS
LAFAYETTE                                                 PORT BARRE
LAWTELL


                                      -55-
<PAGE>   57

                            OFFICERS AND DIRECTORS OF
                             AMERICAN BANCORP, INC.

                       CHAIRMAN OF THE BOARD AND PRESIDENT
                             Salvador L. Diesi, Sr.

                               SECRETARY/TREASURER
                                Ronald J. Lashute

<TABLE>
<CAPTION>


BOARD OF DIRECTORS                               OCCUPATION AND MAIN AFFILIATION

<S>                                              <C>
Jasper J. Artall                                 Farmer.

Walter J. Champagne, Jr.                         Farmer.

J.C. Diesi                                       Automobile Dealer; Diesi
                                                 Pontiac-Cadillac-Buick, Inc.

Salvador L. Diesi, Sr.                           Chairman of the Board and President,
                                                 American Bancorp, Inc. and American
                                                 Bank & Trust Company; Wholesale Beer

                                                 Distributor, Premium Brands, Inc.;
                                                 Gas Station, Convenience Store, and
                                                 Video Poker; Little Capitol of
                                                 Louisiana, Inc.; Commercial real
                                                 estate, farming interest; and Attorney at Law.

Ronald J. Lashute                                Executive Officer and Executive Vice President
                                                 of American  Bank & Trust Company and
                                                 Secretary/Treasurer of American Bancorp, Inc.
</TABLE>


                                      -56-