United States
                       Securities and Exchange Commission
                             Washington, D.C. 20549

                                   Form 10-Q



             [x] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934



                For the quarterly period ended: December 31, 1995



                         Commission file number: 0-8673





                  Financial Services Corporation of the Midwest
             (Exact name of registrant as specified in its charter)




            Delaware                                            36-2301786
  (State or other jurisdiction                                (IRS Employer
of incorporation or organization)                           Identification No.)




224 - 18th Street, Suite 202, Rock Island, Illinois         61201-8737
(Address of principal executive offices)                    (zip code)



                                 (309) 794-1120
                         (Registrant's telephone number)



Indicated by check mark whether the issuer (1) filed all reports  required to be
filed by Section 13 or 15(d) of the Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days. Yes [x] No [ ]


                      APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
Common Stock, as of the latest  practicable  date: Common Stock, $.50 Par Value,
175,111 Shares


<PAGE>










                  FINANCIAL SERVICES CORPORATION OF THE MIDWEST


                                      INDEX



Part I -- Financial Information


                                                                        Page No.

     Item 1    Unaudited Financial Statements:


               Consolidated Balance Sheets --
               December 31, 1995 and March 31, 1995                           3

               Consolidated Statements of Income -- Nine and
               Three Months Ended December 31, 1995 and 1994                  4

               Consolidated   Statements  of  Stockholders'
               Equity - Nine Months Ended  December 31,
               1995 and 1994                                                  5

               Consolidated Statements of Cash Flows --
               Nine Months Ended December 31, 1995 and 1994                   6

               Notes to Consolidated Financial Statements                 7 - 8

     Item 2    Management's Discussion and Analysis of
               the Financial Condition and Results of
               Operations                                                  9-14


Part II -- Other Information and Signatures                                  15



<PAGE>



                  FINANCIAL SERVICES CORPORATION OF THE MIDWEST

                          CONSOLIDATED BALANCE SHEETS
                (Dollars in Thousands, Except Per Share Amounts)

<TABLE>

                                                                                                                (Unaudited)
                                                                                                           -------------------------
                                                                                                           December 31,    March 31,
                                                                                                                1995         1995
                                                                                                           ------------    ---------
<S>                                                                                                        <C>             <C>

ASSETS
Cash and due from banks                                                                                      $ 14,454     $  13,955
Interest-bearing deposits with other financial institutions.............................................           17           198
Investment securities:
    Held-to-maturity (approximate market value December 31, 1995 $33,943 and
        March 31, 1995 $69,852) ........................................................................       33,810        71,822
    Available-for-sale (amortized cost December 31, 1995 $62,624 and March 31, 1995 $0) ................       62,888           - - 
Federal funds sold                                                                                             18,000        32,900

Loan and direct financing leases .......................................................................      243,815       212,076
    Less:  Allowance for possible loan and lease losses ................................................       (4,062)       (3,832)
                                                                                                             --------      --------
        Total loans and leases, net ....................................................................      239,753       208,244

Premises, furniture and equipment, net .................................................................        6,006         3,623
Accrued interest receivable ............................................................................        3,225         1,960
Other real estate, net .................................................................................          642           378
Other asset ............................................................................................        4,088         4,374
                                                                                                             --------      --------
        Total ..........................................................................................     $382,883      $337,454
                                                                                                             ========      ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits:
  Demand ...............................................................................................     $ 32,683      $ 33,496
  N.O.W. accounts ......................................................................................       24,848        23,974
  Savings ..............................................................................................       40,581        42,823
  Insured money market .................................................................................        9,995         8,830
  Other time ...........................................................................................      184,490       162,488
                                                                                                             --------      --------
       Total deposits ..................................................................................      292,597       271,611

Accounts payable and accrued liabilities ...............................................................        5,545         3,895
Securities sold under agreements to repurchase .........................................................       53,538        33,371
Other short-term borrowings                                                                                     1,345           366
Notes payable ..........................................................................................        4,500         5,000
Mandatory convertible debentures .......................................................................        1,250         1,250
                                                                                                             --------      --------
       Total liabilities ...............................................................................      358,775       315,493
                                                                                                             --------      --------
Stockholders' equity:
Capital stock:
  Preferred, no par value; authorized, 100,000 shares:
    Class A Preferred Stock, stated value $100 per share; authorized 50,000 shares;
      issued and outstanding:  December 31, 1995 and March 31, 1995 - 50,000 shares ....................        5,000         5,000
    Class B Preferred Stock, stated value $500 per share; authorized, 1,000 shares;            
      issued and outstanding:  December 31, 1995 and March 31, 1995 - 1,000 shares .....................          500           500
    Class C Preferred Stock, stated value $425 per share; authorized, 2,400 shares;
      issued and outstanding:  December 31, 1995 and March 31, 1995 - 2,400 shares .....................        1,020         1,020
  Common, par value $.50 per share; authorized, 600,000 shares;
    issued:  December 31, 1995 and March 31, 1995 - 340,662 shares;
    outstanding:  December 31, 1995 and March 31, 1995 - 175,111 shares                                           170           170
  Capital surplus ......................................................................................        2,521         2,521
  Net unrealized gain on avai1able-for-sale securities..................................................          174           - -
  Retained earnings ....................................................................................       20,020        18,047
  Treasury stock .......................................................................................       (5,297)       (5,297)
                                                                                                             --------      --------
        Total stockholders' equity .....................................................................       24,108        21,961
                                                                                                             --------      --------
        Total ..........................................................................................     $382,883      $337,454
                                                                                                             ========      ========

</TABLE>
          See accompanying notes to consolidated financial statements.


<PAGE>



                 FINANCIAL SERVICES CORPORATION OF THE MIDWEST

                       CONSOLIDATED STATEMENTS OF INCOME
                (Dollars in Thousands, Except Per Share Amounts)

<TABLE>

                                                                                     (Unaudited)                    (Unaudited)
                                                                                -----------------------     ------------------------
                                                                                  Nine Months Ended            Three Months Ended
                                                                                     December 31,                  December 31,
                                                                                -----------------------     ------------------------
                                                                                  1995          1994          1995           1994
                                                                                ---------     ---------     ---------      ---------
<S>                                                                             <C>           <C>           <C>            <C> 

Interest Income:
    Interest and fees on loans and leases .................................     $  17,772     $  14,362     $   6,361      $   4,893
    Interest on investment securities .....................................         3,520         3,012         1,305            975
    Interest on federal funds sold ........................................           941           767           212            222
    Interest on interest-bearing deposits with other financial
        institutions ......................................................             6            11             2              3
                                                                                ---------     ---------     ---------      ---------
        Total interest income .............................................        22,239        18,152         7,880          6,093
                                                                                ---------     ---------     ---------      ---------
Interest expense:
    Interest on deposits ..................................................         9,464         6,619         3,247          2,193
    Interest on securities sold under agreements to repurchase ............         1,719           682           684            268
    Interest on other short-term borrowings ...............................            58            26            27             10
    Interest on notes payable .............................................           315           319           102            106
    Interest on mandatory convertible debentures ..........................            78            66            26             24
                                                                                ---------     ---------     ---------      ---------
        Total interest expense ............................................        11,634         7,712         4,086          2,601
                                                                                ---------     ---------     ---------      ---------
        Net interest income ...............................................        10,605        10,440         3,794          3,492
Provision for possible loan and lease losses ..............................         1,380         2,260           650            620
                                                                                ---------     ---------     ---------      ---------
        Net interest income after provision for possible loan and
           lease losses ...................................................         9,225         8,180         3,144          2,872
                                                                                ---------     ---------     ---------      ---------
Other income:
    Trust fees ............................................................           222           249            (2)            60
    Investment securities gains ...........................................            11            --            11             --
    Loan servicing fees ...................................................           503           511           170            169
    Gain on sales of loans and leases .....................................           265            86            93             29
    Service charges on deposit accounts ...................................           795           762           259            236
    Insurance commissions .................................................           221           240            84             73
    Other .................................................................           417           493           159            154
                                                                                ---------     ---------      ---------     ---------
        Total other income ................................................         2,434         2,341           774            721
                                                                                ---------     ---------     ---------      ---------
Other expenses:
    Salaries and employee benefits ........................................         4,326         3,870         1,533          1,415
    Occupancy, net ........................................................           571           522           262            264
    Insurance .............................................................           254           535            60            180
    Equipment .............................................................           692           479           353            181
    Data processing .......................................................           400           410           137            129
    Advertising ...........................................................           290           290            58            113
    Other operating .......................................................         1,189         1,108           226            314
                                                                                ---------     ---------     ---------      ---------
           Total other expenses ...........................................         7,722         7,214         2,629          2,596
                                                                                ---------     ---------     ---------      ---------
        Income before income taxes ........................................         3,937         3,307         1,289            997
Income taxes ..............................................................         1,294         1,091           417            320
                                                                                ---------     ---------     ---------      ---------
Net income ................................................................     $   2,643     $   2,216     $     872      $     677
                                                                                =========     =========     =========      =========

Net income available for Common Stock .....................................     $   2,194     $   1,772     $     722      $     528
                                                                                =========     =========     =========      =========
Earnings per common share:
Primary ...................................................................     $   12.53     $   10.20     $    4.12      $    3.03
                                                                                =========     =========     =========      =========
Fully diluted .............................................................     $    8.03     $    6.55     $    2.67      $    2.02
                                                                                =========     =========     =========      =========

Weighted average common shares outstanding ................................       175,111       173,742       175,111        174,002
                                                                                =========     =========     =========      =========
Weighted average common and contingently issuable common
    shares outstanding ................................................           335,421       344,896       332,744        342,429
                                                                                =========     =========     =========      =========
</TABLE>
          See accompanying notes to consolidated financial statements.

<PAGE>



                 FINANCIAL SERVICES CORPORATION OF THE MIDWEST

                CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                (Dollars in Thousands, Except Per Share Amounts)
<TABLE>


                                                                                                    Net
                                                                                                 Unrealized
                                                                                                  Gain on
                                                                                                 Available-
Nine Months Ended                                    Preferred Stock        Common     Capital    For-Sale   Retained    Treasury
December 31, 1995 (Unaudited)                Class A    Class B   Class C    Stock     Surplus   Securities  Earnings      Stock
-----------------------------                -------    -------   -------   --------   -------- ------------ --------    --------
<S>                                          <C>        <C>       <C>       <C>        <C>          <C>      <C>         <C>

Balance at March 31, 1995 ................   $5,000    $   500    $ 1,020   $    170   $  2,521     $   --   $ 18,047    $ (5,297)
Net income ...............................       --         --         --         --         --         --      2,643          --
Change in net unrealized gain on
   available-for-sale securities .........       --         --         --         --         --        174         --          --
Cash dividends declared:
   Class A Preferred, $6.94 per share ....       --         --         --         --         --         --       (347)         --
   Class B Preferred, $37.02 per share ...       --         --         --         --         --         --        (37)         --
   Class C Preferred, $27.09 per share ...       --         --         --         --         --         --        (65)         --
   Common, $1.26 per share ...............       --         --         --         --         --         --       (221)         --
                                             ------    -------    -------   --------   --------   --------   --------    --------
Balance at December 31, 1995 .............   $5,000    $   500    $ 1,020   $    170   $  2,521   $    174   $ 20,020    $ (5,297)
                                             ======    =======    =======   ========   ========   ========   ========    ========

Nine Months Ended 
December 31, 1994 (Unaudited)
----------------------------- 


Balance at March 31, 1994 ...............   $5,000     $  500     $ 1,020   $    170   $  2,484   $     84   $ 15,838    $ (5,345)
Net income ..............................       --         --          --         --         --         --      2,216          --
Change in net unrealized gain on
   available-for-sale securities ........       --         --          --         --         --        (84)        --          --
Sale of Treasury Stock ..................       --         --          --         --         37         --         --          48
Cash dividends declared:
   Class A Preferred, $6.94 per share ...       --         --          --         --         --         --       (347)         --
   Class B Preferred, $32.09 per share ..       --         --          --         --         --         --        (32)         --
   Class C Preferred, $27.09 per share ..       --         --          --         --         --         --        (65)         --
   Common, $1.14 per share ..............       --         --          --         --         --         --       (199)         --
                                            ------     ------     -------   --------   --------    -------    -------     -------
Balance at December 31, 1994 ............   $5,000     $  500     $ 1,020   $    170   $  2,521    $    --    $17,411     $(5,297)
                                            ======     ======     =======   ========   ========    =======    =======     =======
</TABLE>

          See accompanying notes to consolidated financial statements.

<PAGE>



                 FINANCIAL SERVICES CORPORATION OF THE MIDWEST

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Dollars in Thousands)

<TABLE>
                                                                                                                    (Unaudited)
                                                                                                         --------------------------
                                                                                                             Nine Months Ended
                                                                                                               December 31,
                                                                                                         --------------------------
                                                                                                           1995              1994
                                                                                                         --------          --------
<S>                                                                                                      <C>               <C>

Cash Flows From Operating Activities:
Net income .....................................................................................         $  2,643          $  2,216
Adjustments to reconcile net income to net cash provided by operating activities:
    Depreciation and amortization ..............................................................              670               541
    Provision for possible loan and lease losses ...............................................            1,380             2,260
    Gain on sale of investment securities available-for-sale ...................................              (11)               --
    Investment amortization ....................................................................              113               395
    Loans and leases originated for sale .......................................................          (49,694)          (26,264)
    Proceeds on sale of loans and leases .......................................................           48,769            26,626
    Increase in interest receivable ............................................................           (1,265)             (336)
    Increase in interest payable ...............................................................            1,021               112
    Decrease in other assets ...................................................................              283                 7
    Increase (decrease) in other liabilities ...................................................              629              (323)
                                                                                                         --------          --------
Net cash provided by operating activities ......................................................            4,538             5,234
                                                                                                         --------          --------

Cash Flows From Investing Activities:
Net decrease in federal funds sold .............................................................           14,900            17,400
Net decrease in interest-bearing deposits with other financial institutions ....................              181               198
Purchase of investment securities held-to-maturity .............................................          (16,076)          (20,501)
Proceeds from maturity or call of investment securities held-to-maturity .......................           19,000            10,964
Purchase of investment securities available-for-sale ...........................................          (34,790)               --
Proceeds from maturity or call of investment securities available-for-sale .....................               --            18,000
Proceeds from sales of investment securities available-for-sale ................................            7,152                --
Net increase in loans and leases ...............................................................          (31,964)          (25,872)
Other investing activities, net ................................................................           (3,404)             (590)
                                                                                                         --------          --------

Net cash used in investing activities ..........................................................          (45,001)             (401)
                                                                                                         --------          --------

Cash Flows From Financing Activities:
Net increase (decrease) in deposits ............................................................           20,986            (4,087)
Net increase in short-term borrowings ..........................................................           13,696             4,743
Proceeds from other borrowings .................................................................           27,259             8,998
Payments on other borrowings ...................................................................          (19,809)          (10,663)
Proceeds from sale of Treasury Stock ...........................................................               --                85
Payments on notes payable ......................................................................             (500)               --
Cash dividends paid on Preferred Stock .........................................................             (449)             (444)
Cash dividends paid on Common Stock ............................................................             (221)             (199)
                                                                                                         --------           -------

Net cash provided by (used in) financing activities ............................................           40,962            (1,567)
                                                                                                         --------           -------

Net increase in cash and due from banks ........................................................              499             3,266

Cash and due from banks at the beginning of the year ...........................................           13,955            11,484
                                                                                                         --------          --------
Cash and due from banks at the end of the period ................................................        $ 14,454          $ 14,750
                                                                                                         ========          ========

</TABLE>

                See accompanying notes to consolidated financial statements.

<PAGE>


                 FINANCIAL SERVICES CORPORATION OF THE MIDWEST
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

1.       Interim Financial Statements - The accompanying  unaudited consolidated
         financial  statements  have been prepared in accordance  with the rules
         and  regulations  of the Securities  and Exchange  Commission.  Certain
         information  and footnote  disclosures  normally  included in financial
         statements  prepared in accordance with generally  accepted  accounting
         principles  have been  condensed or omitted  pursuant to such rules and
         regulations.  These consolidated financial statements should be read in
         conjunction  with  the  consolidated  financial  statements  and  notes
         thereto  contained in Financial  Services  Corporation of the Midwest's
         ("FSCM")  Form 10-KSB for the fiscal year ended March 31,  1995,  filed
         with the Securities and Exchange Commission.

         In the  opinion  of  management  of FSCM,  the  accompanying  unaudited
         consolidated  financial statements contain all adjustments  (consisting
         of only normal  recurring  accruals)  necessary  to present  fairly the
         financial  position  of FSCM,  its results of  operations  and its cash
         flows  for the  interim  periods  presented.  Interim  results  are not
         necessarily indicative of the results to be expected for the full year.

2.       Supplemental Disclosures of Cash Flow Information - Cash paid for:

                                                     Nine Months Ended
                                                         December 31,

 (Dollars in Thousands)                               1995               1994
 ---------------------                               -------             -------

Interest ...............................             $10,612             $ 7,600
Income taxes ...........................               1,180               1,335

3.       Earnings Per Common Share Data - The following  information was used in
         the  computation  of  earnings  per common  share on both a primary and
         fully diluted basis for the respective nine and three month periods.

<TABLE>

                                                                              Nine Months Ended               Three Months Ended
(Dollars in Thousands)                                                           December 31,                   December 31,
----------------------                                                    -------------------------       -------------------------
                                                                             1995           1994            1995            1994
                                                                          ----------      ---------       ---------       ---------
<S>                                                                       <C>             <C>             <C>             <C>

Net income .........................................................      $   2,643       $   2,216       $     872       $     677
Accrued preferred dividends ........................................           (449)           (444)           (150)           (149)
                                                                          ---------       ---------       ---------       ---------

   Primary earnings ................................................          2,194           1,772             722             528
Accrued convertible preferred dividends ............................            449             444             150             149

Mandatory convertible debentures interest expense,
   net of tax ......................................................             52              43              18              16
                                                                          ---------       ---------       ---------       ---------

   Fully diluted earnings ..........................................      $   2,695       $   2,259       $     890       $     693
                                                                          =========       =========       =========       =========

Weighted average common shares outstanding .........................        175,111         173,742         175,111         174,002

Weighted average common shares issuable upon conversion of:
   Class A Preferred Stock1 ........................................         75,199          86,043          72,522          83,316
   Class B Preferred Stock2 ........................................         11,111          11,111          11,111          11,111
   Class C Preferred Stock2 ........................................         24,000          24,000          24,000          24,000

   Mandatory convertible debentures2 ...............................         50,000          50,000          50,000          50,000
                                                                          ---------       ---------       ---------       ---------
       Weighted average common and contingently issuable
            common shares outstanding ..............................        335,421         344,896         332,744         342,429
                                                                          =========       =========       =========       =========
<PAGE>



<FN>

1    The Class A Cumulative Convertible Preferred Stock cannot be converted into
     Common Stock until on or after December 1, 2002.

2    The Class B and C Preferred Stock and the mandatory convertible  debentures
     are  convertible  at the option of the holders.  The holders of the Class B
     and C Preferred  Stock and  certain  holders of the  mandatory  convertible
     debentures have consented to provide FSCM with a ninety day notice prior to
     the  conversion  of their  securities  and allow for the  obtainment of any
     necessary regulatory approval or legal opinion.

</FN>
</TABLE>

No mandatory convertible  debentures or Preferred Stock were converted to common
shares during the periods presented.


<PAGE>

                  FINANCIAL SERVICES CORPORATION OF THE MIDWEST
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

Business Development

In June 1995,  management of THE Rock Island Bank, N.A. ("TRIB"),  FSCM's wholly
owned bank subsidiary,  submitted  applications to the Office of the Comptroller
of the Currency ("OCC") for permission to: 1) become a national association,  2)
relocate the head office of the new national association to Bettendorf, Iowa, 3)
maintain the former head office in downtown  Rock  Island,  Illinois as a branch
office,  4) retain  existing  branch offices in Rock Island and East Moline,  5)
practice trust powers in both Illinois and Iowa,  and 6) increase  investment in
fixed assets.  Preliminary approval was received from the OCC in August 1995. In
September  1995,  an option was  exercised  to  acquire a facility  for the head
office at 3120  Middle  Road,  Bettendorf,  Iowa.  On  November  1,  1995,  TRIB
officially  became THE Rock Island  Bank,  National  Association  and opened its
Bettendorf office.

It is one of TRIB's goals to offer  convenient  retail banking  services to both
its Illinois and Iowa Quad Cities customers.  TRIB currently services a bi-state
market  area;  however,  due to the  lack  of  customer  convenience  caused  by
restrictive  interstate retail deposit regulations,  a disproportionally  higher
level of lending  activity  than retail  deposit  activity  currently  exists in
TRIB's Iowa customer base.  Management  anticipates that with the opening of the
Bettendorf  office,  retail deposit  activity will increase.  As of December 31,
1995, the office had obtained approximately $5 million in deposits.

Results of Operations

Overview

Net income  equaled $2.6 million for the nine months ended  December 31, 1995, a
$427  thousand,  or 19%,  increase from December 31, 1994's income level of $2.2
million. Correspondingly,  fully diluted earnings per common share equaled $8.03
and $6.55 for the respective nine month periods. Net income for the three months
ended  December  31,  1995 and  1994,  was  $872  thousand  and  $677  thousand,
respectively,  or, on a fully diluted earnings per common share basis, $2.67 and
$2.02,  respectively.  The increase in net income between periods ended December
31, 1995 and 1994 resulted from net changes in the following  income and expense
categories:

                                                            Change in Income
                                                        ------------------------
(Dollars in Thousands)                                  Nine Months Three Months
----------------------                                  ----------- ------------

Interest income ......................................     $ 4,087      $ 1,787
Interest expense .....................................      (3,922)      (1,485)
                                                           -------      -------
Net interest income ..................................         165          302
Provision for possible loan and lease losses .........         880          (30)
Other income .........................................          93           53
Other expenses .......................................        (508)         (33)
Income taxes .........................................        (203)         (97)
                                                           -------      -------
Net increase in net income ...........................     $   427      $   195
                                                           =======      =======

The   efficiency  and  overhead   ratios  are  two  commonly  used   performance
measurements.  Both measure the  coverage of  operating  expense by net interest
income.  In the efficiency  ratio,  other income is added to net interest income
and in the overhead  ratio other  income is netted  against  operating  expense.
Industry  established   benchmarks  for  these  two  ratios  are  55%  and  45%,
respectively,   with  a  lower   comparable   percentage   indicating  a  better
performance.  The improvement in the net interest margin during the three months
ended  December 31, 1995 resulted in an improvement in both of these ratios from
September 1995 quarter end. However, 1995's nine month ratios still trail 1994's
ratios  primarily due to the increased other  expenses.  As of December 31, 1995
and 1994 the efficiency ratio equaled 59.27% and 56.44%,  respectively,  for the
nine months and 57.69% and 61.62%, respectively for the three month periods. The
overhead ratios were 49.97% and 46.68% for the nine months and 49.18% and 53.69%
for the three  month  comparative  periods,  respectively.  The  efficiency  and
overhead  ratios for TRIB for the nine months  ended  December  31, 1995 equaled
55.32% and 46.89%, respectively. The difference in these ratios between FSCM and
TRIB  reflects  primarily  FSCM's  interest  expense  due  to  its  indebtedness
outstanding.

<PAGE>



Net Interest Income

Net interest  income equaled $10.6 million and $10.4 million for the nine months
ended  December  31,  1995 and 1994,  respectively,  and $3.8  million  and $3.5
million  for the  respective  three month  periods.  Stated as a  percentage  of
average  interest-earning  assets,  the nine month net  interest  margin  ratios
equaled 4.30% and 4.82%, respectively. The decrease in the margin ratio resulted
from  disproportional  growth between  interest-earning  assets, which increased
13.8% to a $329 million level,  and net interest  income,  which  increased only
1.6% to $10.6  million.  The growth in assets  centered  in loans and was funded
primarily by increased  time deposit  accounts.  The return on  interest-earning
assets  rose 64 basis  points to 9.02%;  however,  the cost of  interest-bearing
liabilities rose 129 basis points to 5.27%.


                   AVERAGE BALANCE AND INTEREST RATE ANALYSIS
<TABLE>


                                                                                          Nine Months Ended
                                                                 -------------------------------------------------------------------
    (Dollars in Thousands)                                                December 31, 1995                  December 31, 1994
    ----------------------                                       --------------------------------      -----------------------------
                                                                                          Average                            Average
                                                                Average                   Annual       Average               Annual
                                                                Balance      Interest      Rate        Balance    Interest    Rate
                                                                --------     --------     -------     --------    --------   -------
     <S>                                                        <C>          <C>          <C>         <C>         <C>        <C>
    ASSETS
    Interest-bearing deposits with other
        financial institutions .............................    $    124     $      6        6.45     $    345    $     11     4.25%
    Investment securities ..................................      81,627        3,520        5.75       79,480       3,012     5.05
    Federal funds sold .....................................      21,149          941        5.93       23,005         767     4.45
    Loans and leases, net1 .................................     225,789       17,772       10.49      186,095      14,362    10.29
                                                                --------     --------                 --------    --------    

        Total interest-earning assets ......................    $328,689       22,239        9.02     $288,925      18,152     8.38
                                                                ========     --------                 ========     -------

    LIABILITIES
    Savings deposits........................................    $ 74,323        1,381        2.48     $ 94,222       1,849     2.62
    Time deposits ..........................................     171,473        8,083        6.29      134,954       4,770     4.71
    Federal funds purchased.................................         116            5        5.75         --          --       --
    Securities sold under agreements to
        repurchase .........................................      40,927        1,719        5.60       22,442         682     4.05
    Other short-term borrowings ............................       1,216           53        5.81          802          26     4.32
    Notes payable ..........................................       4,944          315        8.50        5,000         319     8.51
    Mandatory convertible debentures .......................       1,250           78        8.32        1,250          66     7.04
                                                                --------     --------                 --------    --------
        Total interest-bearing liabilities .................    $294,249       11,634        5.27     $258,670       7,712     3.98
                                                                ========     --------                 ========    --------

    Net interest income ....................................                 $ 10,605                             $ 10,440
                                                                             ========                             ========
    Net interest margin (net interest income
        divided by average total interest-
        earning assets) ....................................                                 4.30%                             4.82%
                                                                                            =====                             =====

<FN>
1  Nonaccruing loans and leases are included in the average balance.
</FN>
</TABLE>
<PAGE>



                           INTEREST VARIANCE ANALYSIS

<TABLE>

                                                                                                 Nine Months Ended December 31, 1995
                                                                                                          vs. December 31, 1994
                                                                                                 -----------------------------------
                                                                                                           Increase (Decrease)
                                                                                                            Due to Change in1
                                                                                                    --------------------------------
                                                                                                    Average    Average      Total
Dollars in Thousands)                                                                               Balance     Rate        Change
---------------------                                                                              --------    -------      --------
<S>                                                                                                <C>         <C>          <C> 

Interest income:
        Interest-bearing deposits with other financial institutions ....................           $    (7)    $     2      $    (5)
        Investment securities ..........................................................                81         427          508
        Federal funds sold .............................................................               (62)        236          174
        Loans and leases ...............................................................             3,063         347        3,410
                                                                                                   -------     -------      -------
           Total interest income .......................................................             3,075       1,012        4,087
                                                                                                   -------     -------      -------
Interest expense:
        Savings deposits ...............................................................              (390)        (78)        (468)
        Time deposits ..................................................................             1,291       2,022        3,313
        Federal funds purchased ........................................................                --           5            5
        Securities sold under agreements to repurchase .................................               562         475        1,037
        Short-term borrowings ..........................................................                13          14           27
        Notes payable ..................................................................                (4)         --           (4)
        Mandatory convertible debentures ...............................................                --          12           12
                                                                                                   -------    --------      -------
           Total interest expense ......................................................             1,472       2,450        3,922
                                                                                                   -------    --------      -------
Change in net interest income ......................................................               $ 1,603    $ (1,438)     $   165
                                                                                                   =======    ========      =======

<FN>

1    The change in interest due to the volume and rate has been allocated to the
     change in average  rate.  Nonaccruing  loans and leases are included in the
     average  balance.  Loan and lease  fees of $1,072  and  $1,042 for the nine
     months ended December 31, 1995 and 1994, respectively,  are included in the
     interest income on loans and leases.
</FN>
</TABLE>


<PAGE>



Composition of the  interest-bearing  liabilities  reflected  substantial shifts
from lower cost savings deposits to more aggressively priced products, including
time deposits and securities  sold under  agreements to repurchase  ("repurchase
agreements").  This shift primarily  resulted from intense local competition for
funds which was used to support  strong loan  demand and  consequently  led to a
higher cost of funds.

Provision for Possible Loan and Lease Losses

The provision  for possible loan and lease losses  totaled $1.4 million and $2.2
million for the nine months ended and $650  thousand  and $620  thousand for the
three months ended December 31, 1995 and 1994,  respectively.  The amount of the
provision was based on management's  assessment of the adequacy of the allowance
for possible loan and lease losses in relation to both  non-performing and total
loans and leases  outstanding.  The increase in the  December  1994's nine month
provision was due to a one-time $953  thousand loan  charge-off  that related to
certain  financed   equipment  leases  associated  with  business  entities  and
individuals  suspected  of  fraud.  The  allowance,  stated as a  percentage  of
non-performing loans and leases,  equaled 305.87% and 135.71% as of December 31,
1995 and 1994,  respectively.  Such ratio for the  Comparative  Peer Group (Bank
Holding  Companies in the seventh  Federal  Reserve  District with  consolidated
assets between $300 million and $500 million)  equaled  349.42% (as of September
1995, the most recent data available). Management is satisfied that the level of
the allowance is adequate to provide for future losses.

Net  charge-offs  for the nine months ended December 31, 1995 and 1994 were $1.1
million and $1.7 million,  respectively,  as compared to net charge-offs for the
three month periods which equaled a $563 thousand charge-off and a $132 thousand
recovery  for  the  respective  years.   Approximately   $392  thousand  of  the
charge-offs during the three months ended December 31, 1995 were associated with
a commercial business which went bankrupt.

Other Income

Other  income  totaled  $2.4  million and $2.3 million for the nine months ended
December 31, 1995 and 1994, respectively.  Similarly,  other income totaled $774
thousand  and  $721  thousand  for  the  respective  three  month  periods.  The
improvement  in 1995  over  1994 in both the nine and  three  month  comparisons
primarily  stems from an increase  in gains on sales of loans and leases.  It is
anticipated that the volume of residential  mortgage  originations will continue
to be strong during the next fiscal quarter.

Other Expenses

As of December 31, 1995,  FSCM  employed 174 full-time  equivalent  employees as
compared to 163 in December 1994. The increased  employment  primarily  resulted
from the staffing of the new  Bettendorf  office and the addition of an indirect
consumer lending program to TRIB's loan portfolio. Salary and employee benefits,
which  represented  over 53% of total other expenses,  increased to $4.3 million
from  $3.9  million  for the nine  months  ended  December  31,  1995 and  1994,
respectively;  and to $1.5 million from $1.4 million for the similar three month
periods.  Stated as a  percentage  of average  assets,  1995's nine month salary
expense totaled 1.64% as compared to FSCM's Peer Group ratio which equaled 1.71%
(based on September 1995 information).

Insurance  expense totaled $254 thousand and $60 thousand for the nine and three
months ended  December 31, 1995 as compared to $535  thousand and $180  thousand
for the respective  1994 periods.  The reduction  between 1995 and 1994 resulted
primarily from the June 1995 decrease in Federal Deposit  Insurance  Corporation
("FDIC") premiums from $0.23 to $0.04 per $100 of deposits.

Equipment  expense  increased to $692  thousand  from $479 thousand for the nine
months ended December 31, 1995 and 1994,  respectively.  The corresponding three
month expenses totaled $353 thousand and $181 thousand. During the quarter ended
December  1995,  investments  of  approximately  $1.1 million in  equipment  and
furniture  were  placed in  service.  The more  significant  of the  investments
included the furnishing and equipping of two office facilities which were opened
during  the  quarter,  the  implementation  of  a  platform  system  for  teller
operations,  an upgrade  and  consolidation  between  offices  of the  telephone
systems, and the installations of local area networks at all office sites and of
a wide area network to link them. The additional depreciation expense associated
with the  investments  approximated  $147 thousand during the three months ended
December 31, 1995. In addition, a $30 thousand change was expensed which related
to the disposal of equipment acquired in the purchase of the Bettendorf office.

Included  in the $1.2  million of other  operating  expense  for the nine months
ended December 31, 1995, were costs associated with the employment of a national
consulting  firm to perform a bank-wide "best  practices"  review of operational
functions  and  systems  structure.  From this  review,  management  anticipates
improved financial  services and operational  performance  through  restructured
fees, increased productivity and the utilization of more efficient technology.



<PAGE>










Financial Condition

Overview

Assets  have  increased  13.5%  between  December  and March  1995 to total $383
million up from $337 million,  respectively.  The $46 million  growth,  combined
with a $15  million  reduction  between  periods  in  federal  funds  sold,  was
primarily distributed between both net loans and lease and investment securities
which increased $32 million and $25 million,  respectively. The asset growth was
funded by increased  time deposits of $22 million and  repurchase  agreements of
$20 million.

Investments

On December 19, 1995, the Board of Directors of TRIB elected to transfer step-up
rate,  callable  structured  notes with an amortized  cost of $35 million and an
unrealized gain of $53 thousand from held-to-maturity to available-for-sale. The
transfer was made pursuant to a Special Report,  "A Guide to  Implementation  of
Statement  115  on  Accounting  for  Certain  Investments  in  Debt  and  Equity
Securities,"  issued by the  Financial  Accounting  Standards  Board in November
1995, and was so elected in order to enhance liquidity. As of December 31, 1995,
the net market gain on said securities equaled $95 thousand.

Additionally,   in  December  1995,   management   purchased  $11.7  million  in
mortgage-backed  agency  securities  ("MBS")  which yield a 6.12% return with an
average  life of  approximately  five years.  The  purchase  aided in  portfolio
diversification and yield enhancement.

Given the  current  environment  of  declining  interest  rates,  management  is
monitoring  the risk  characteristics  of  investments  with call  provisions to
quantify  exposure and review  alternative  investment  options.  Management has
identified approximately $37 million of investments which could be called during
the three  months  ending  March 31,  1996,  in addition to $2 million  which is
scheduled to mature.  It is their intent to reinvest any called  investments  in
new issues with similar maturity characteristics.

Loans and Direct Financing Leases

Growth in loans between  December and March 1995 occurred  fairly evenly in most
categories  as depicted in the below  table.  Aiding the growth in the  consumer
loan  area  was the  initiation  in May  1995 of a new  indirect  consumer  loan
program. It is anticipated that this particular program will generate between $1
million to $1.5  million in new  business  per month.  Such  overall loan growth
reflects TRIB's continued strong  commitment to service the Quad-Cities  market.
As a percentage of total assets,  net loans and leases equaled 62.62% and 61.71%
as of December 31 and March 31, 1995, respectively, as compared to it Peer Group
ratio of 58.97% (based on September 1995 information).


                           LOAN AND LEASE DISTRIBUTION

                                                           Dec. 31     March 31,
(Dollars in Thousands)                                       1995         1995
----------------------                                     --------    ---------

Commercial, financial and agricultural ...............     $ 83,301     $ 74,234
Direct financing leases ..............................        5,532        6,863
Real  estate:
   Residential mortgage1 .............................       61,436       58,486
   Construction ......................................       21,160       14,553
   Commercial mortgage ...............................       58,935       51,529
Consumer, not secured by a real estate mortgage ......       13,451        6,411
                                                           --------     --------

         Total loans and leases ......................     $243,815     $212,076
                                                           ========     ========


1        Includes  first  mortgages  pending  conclusion  of  their  sale to the
         Federal Home Loan Mortgage Corporation ("FHLMC"), the Fannie Fannie Mae
         and the Illinois Housing Development  Authority  ("IHDA"),  home equity
         lines of credit,  home improvement  loans, and consumer loans for which
         junior liens were taken as primary and secondary sources of security.





<PAGE>




Premises, Furniture and Equipment

Net fixed asset  investments  have increased  $2.4 million,  or 66%, since March
1995 to total $6 million at  December  31,  1995.  FSCM's  ratio of  non-earning
assets (which includes premises,  furniture and equipment) to total assets as of
December  31, 1995 of 7.42%  compares  favorably to that of its Peer Group which
equaled  8.49% (based on September  1995  information).  In addition to the $889
thousand net increase in  furniture  and  equipment  previously  discussed,  the
following paragraphs detail other investments in fixed assets.

In September  1995 the  Bettendorf,  Iowa office was purchased for $709 thousand
which consisted of land,  building and  miscellaneous  equipment.  An additional
$148  thousand  was  invested to remodel the office  which  opened for  business
November 1, 1995.

Construction  of the  enlarged  branch  office at 18th Avenue  (Hilltop) in Rock
Island,  Illinois was  completed and  operations  commenced at the new office on
November 29, 1995.  Since March 1995,  approximately  $1 million was invested in
the construction project.

Management has commenced the installation of new computer support  technology to
support  TRIB's  operations.  When completed in the fourth fiscal quarter ending
March 1996,  check processing and  laser-printer  equipment will replace 14-year
old equipment  which will speed daily  operations  and result in  easier-to-read
customer  statements.  Certain paper reports will be eliminated by using optical
storage  for the  retrieval  of  management  information.  It is  budgeted  that
approximately $200 thousand will be spent to acquire and install these systems.

The office expansion into both East Moline and Bettendorf,  and the construction
of the enlarged  Hilltop branch office in Rock Island will provide better access
to the retail markets and thereby should enhance TRIB's overall market presence.
The  installation  of new  equipment  and  technological  upgrades  will enhance
productivity and customer convenience.

Deposits,   Securities  Sold  Under  Agreements  to  Repurchase  and  Short-Term
Borrowings

Deposit  growth  centered in time deposits  which  increased $22 million to $184
million as of December 31, 1995, an increase of 13.6% from March's total of $162
million.  Repurchase agreements increased $20 million to total $53 million as of
December 31, 1995. Based on past  experience,  management  considers  repurchase
agreements to be a relatively stable source of funding for TRIB.

Capital Resources

FSCM's  capital,  as measured by standards  established  by the federal  banking
regulators,  exceeded  those defined for  "well-capitalized"  institutions.  The
table below sets forth FSCM's  ratios as of December  31,  1995,  as well as the
ratios  for   "well-capitalized"   institutions   and  the  minimum   regulatory
requirements.


                                 CAPITAL RATIOS

                                                        Regulatory Requirements
                                                      --------------------------
                                              FSCM    Minimum   Well Capitalized
                                             -------  -------   ----------------
Risk-based capital ratios:
     Tier 1 Capital ....................       9.23%     4.00%        6.00%
     Total Capital .....................      12.00      8.00        10.00
Leverage (based on average assets) .....       6.76      3.00         5.00


Liquidity

In March 1995, TRIB was approved for membership to the Federal Home Loan Bank of
Chicago ("FHLB"). Such membership was requested in order to provide TRIB with an
additional  source of  liquidity  and a  potential  funding  source for new real
estate loan products.  Advances from the FHLB of approximately $40 million, on a
collateralized basis, were available under FHLB's operating guidelines as of the
end of  December  1995 in  addition to the  existing  $1 million  advance  which
matures in January 1996.

Federal  funds   purchase  lines  have  also  been   established   with  several
correspondent  banks  to  cover  short-term  funding  needs.  In  addition,  the
previously   discussed   reclassification  of  $34  million  in  investments  to
available-for-sale will provide another source of liquidity.




<PAGE>





                  FINANCIAL SERVICES CORPORATION OF THE MIDWEST

Part II - Other Information and Signatures



Item 6.  Exhibits and Reports on Form 8-K

         (a)  Exhibits

               10.4      Demand  Business  Note executed by FSCM in favor of M&I
                         Bank in the  original  principal  amount of  $5,000,000
                         dated as of July 31, 1995.

               10.6      Summary of Material  Terms of Directors'  and Officers'
                         Liability   Policy  covering  the  policy  period  from
                         October 18, 1995 to October 18, 1996.

               Reports on Form 8-K

               A report dated  November 1, 1995 was filed on Form 8-K.  Under an
               Other Event (Item 5) disclosure,  FSCM reported the conversion of
               its bank  subsidiary,  TRIB,  to a National  Association  and the
               opening of a banking office in Bettendorf, Iowa.
Signatures

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.


                                   FINANCIAL SERVICES CORPORATION OF THE MIDWEST


Date:  February 13, 1995           By:   /S/ Douglas M. Kratz
                                         --------------------------------------
                                                               Douglas M. Kratz
                                                 President, CEO, CFO, Secretary



                                   By:   /S/ Jean M. Hanson
                                         --------------------------------------
                                                                 Jean M. Hanson
                                           Controller, Chief Accounting Officer