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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-Q



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|x | QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT of 1934
|- | ---------------------------------------------------------------------------------------



For the Quarterly Period Ended March 31, 2004



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------



For the transition period from  to
.



Commission File No. 1-13652



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First West Virginia Bancorp, Inc.

(Exact name of registrant as specified in its charter)



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|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|West Virginia                                                  |  | 55-6051901                          
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)



1701 Warwood Avenue

Wheeling, West Virginia 26003

(Address of principal executive offices)



Registrants telephone number, including area code: (304) 277-1100



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N/A

(Former name, former address and former fiscal year, if changed since last report)



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



Indicate by check-mark whether the registrant is an
accelerated filer (as defined in Rule 12b-2 of the Act). ̈Yes    x  No



APPLICABLE ONLY TO
ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:



Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the
Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. ̈Yes ̈No    x  N/A



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 practible date.



The number of shares outstanding of
the issuers common stock as of May 12, 2004:



Common Stock, $5.00 Par
Value, shares outstanding 1,538,443 shares



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##### Table of Contents

FORM 10-Q INDEX



|                               |  |                                                                                       |  |        
|------------------------------ |  | ------------------------------------------------------------------------------------- |  | -------
|PART I  Financial Information |  |                                                                                      
|                               |  |                                                                                      
|Item 1                         |  | Financial Statements and Accompanying Notes                                           |  | 3  9  
|                               |  |                                                                                      
|Item 2                         |  | Managements Discussion and Analysis of Financial Condition and Results of Operations |  | 10  23
|                               |  |                                                                                      
|Item 3                         |  | Quantitative and Qualitative Disclosures About Market Risk                            |  | 24     
|                               |  |                                                                                      
|Item 4                         |  | Controls and Procedures                                                               |  | 24     
|                               | 
|PART II  Other Information    |  |                                                                                      
|                               |  |                                                                                      
|Item 1                         |  | Legal Proceedings                                                                     |  | 25     
|                               |  |                                                                                      
|Item 2                         |  | Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities      |  | 25     
|                               |  |                                                                                      
|Item 3                         |  | Defaults upon Senior Securities                                                       |  | 25     
|                               |  |                                                                                      
|Item 4                         |  | Submission of matters to a Vote of Security Holders                                   |  | 25     
|                               |  |                                                                                      
|Item 5                         |  | Other Information                                                                     |  | 25     
|                               |  |                                                                                      
|Item 6                         |  | Exhibits and Reports on Form 8-K                                                      |  | 25     
|                               |  |                                                                                      
|                               |  | Exhibit Index                                                                         |  | 27     
|                               |  |                                                                                      
|                               |  | Reports on Form 8-K                                                                   |  | 25     
|                               |  |                                                                                      
|                               |  | Signatures                                                                            |  | 26     
|                               |  |                                                                                      
|                               |  | Certifications                                                                        |  | 30  32



2



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##### Table of Contents

FIRST WEST VIRGINIA BANCORP, INC.

PART I

FINANCIAL INFORMATION



First West Virginia Bancorp, Inc.

CONSOLIDATED BALANCE SHEETS



|                                                                           |  |                |             |   |                   |   |             |  
|-------------------------------------------------------------------------- |  | -------------- | ----------- | - | ----------------- | - | ----------- | -
|                                                                           |  | March 31, 2004 |             |   | December 31, 2003 |  
|                                                                           |  | (Unaudited)    |             |   |                   |  
|ASSETS                                                                     |  |                |             |   |                   |   |             |  
|Cash and due from banks                                                    |  | $              | 5,250,745   |   |                   | $ | 6,553,689   |  
|Due from banks - interest bearing                                          |  |                | 3,668,583   |   |                   |   | 470,705     |  
|Federal funds sold                                                         |  |                | 2,290,000   |   |                   |   |            |  
|                                                                           |  |                |             |   |                   |   |             |  
|Total cash and cash equivalents                                            |  |                | 11,209,328  |   |                   |   | 7,024,394   |  
|Investment securities:                                                     |  |                |             |   |                   |   |             |  
|Available-for-sale (at fair value)                                         |  |                | 111,491,520 |   |                   |   | 115,269,352 |  
|Held-to-maturity (fair value of $3,578,111 and $4,185,960, respectively)   |  |                | 3,366,360   |   |                   |   | 3,975,685   |  
|Loans                                                                      |  |                | 151,150,002 |   |                   |   | 146,710,494 |  
|Less allowance for loan losses                                             |  |                | (2,188,215  | ) |                   |   | (2,304,868  | )
|                                                                           |  |                |             |   |                   |   |             |  
|Net loans                                                                  |  |                | 148,961,787 |   |                   |   | 144,405,626 |  
|Premises and equipment, net                                                |  |                | 3,847,749   |   |                   |   | 3,927,751   |  
|Accrued income receivable                                                  |  |                | 1,440,270   |   |                   |   | 1,275,846   |  
|Other intangible assets                                                    |  |                | 347,609     |   |                   |   | 369,797     |  
|Goodwill                                                                   |  |                | 1,644,119   |   |                   |   | 1,644,119   |  
|Other assets                                                               |  |                | 2,288,181   |   |                   |   | 6,218,290   |  
|                                                                           |  |                |             |   |                   |   |             |  
|Total assets                                                               |  | $              | 284,596,923 |   |                   | $ | 284,110,860 |  
|                                                                           |  |                |             |   |                   |   |             |  
|LIABILITIES                                                                |  |                |             |   |                   |   |             |  
|Noninterest bearing deposits:                                              |  |                |             |   |                   |   |             |  
|Demand                                                                     |  | $              | 22,704,278  |   |                   | $ | 23,938,810  |  
|Interest bearing deposits:                                                 |  |                |             |   |                   |   |             |  
|Demand                                                                     |  |                | 37,796,135  |   |                   |   | 37,236,254  |  
|Savings                                                                    |  |                | 89,218,883  |   |                   |   | 89,461,195  |  
|Time                                                                       |  |                | 90,675,651  |   |                   |   | 91,311,071  |  
|                                                                           |  |                |             |   |                   |   |             |  
|Total deposits                                                             |  |                | 240,394,947 |   |                   |   | 241,947,330 |  
|Federal funds purchased and securities sold under agreements to repurchase |  |                | 13,545,689  |   |                   |   | 15,088,834  |  
|Federal Home Loan Bank borrowings                                          |  |                | 2,454,046   |   |                   |   | 2,463,464   |  
|Accrued interest payable                                                   |  |                | 385,100     |   |                   |   | 384,817     |  
|Other liabilities                                                          |  |                | 4,074,216   |   |                   |   | 1,195,800   |  
|                                                                           |  |                |             |   |                   |   |             |  
|Total liabilities                                                          |  |                | 260,853,998 |   |                   |   | 261,080,245 |  
|                                                                           |  |                |             |   |                   |   |             |  
|STOCKHOLDERS EQUITY                                                       |  |                |             |   |                   |   |             |  
|Common stock - 2,000,000 shares authorized at $5 par value:                |  |                |             |   |                   |   |             |  
|1,538,443 shares issued at March 31, 2004 and December 31, 2003            |  |                | 7,692,215   |   |                   |   | 7,692,215   |  
|Treasury stock - 10,000 shares at cost:                                    |  |                | (228,100    | ) |                   |   | (228,100    | )
|Surplus                                                                    |  |                | 4,982,606   |   |                   |   | 4,982,606   |  
|Retained earnings                                                          |  |                | 10,330,034  |   |                   |   | 9,961,698   |  
|Accumulated other comprehensive income                                     |  |                | 966,170     |   |                   |   | 622,196     |  
|                                                                           |  |                |             |   |                   |   |             |  
|Total stockholders equity                                                 |  |                | 23,742,925  |   |                   |   | 23,030,615  |  
|                                                                           |  |                |             |   |                   |   |             |  
|Total liabilities and stockholders equity                                 |  | $              | 284,596,923 |   |                   | $ | 284,110,860 |  
|                                                                           |  |                |             |   |                   |   |             |  



The accompanying notes
are an integral part of the consolidated financial statements.



3



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##### Table of Contents

First West Virginia Bancorp, Inc.

CONSOLIDATED STATEMENTS OF INCOME



|                                                             |  |                               |           |   |      |   |          
|------------------------------------------------------------ |  | ----------------------------- | --------- | - | ---- | - | ---------
|                                                             |  | Three Months Ended, March 31,
|                                                             |  | 2004                          |           |   | 2003
|                                                             |  | (Unaudited)                  
|INTEREST AND DIVIDEND INCOME                                 |  |                               |           |   |      |   |          
|Loans, including fees:                                       |  |                               |           |   |      |   |          
|Taxable                                                      |  | $                             | 2,204,966 |   |      | $ | 2,227,181
|Tax-exempt                                                   |  |                               | 152,107   |   |      |   | 141,926  
|Debt securities:                                             |  |                               |           |   |      |   |          
|Taxable                                                      |  |                               | 778,664   |   |      |   | 822,308  
|Tax-exempt                                                   |  |                               | 154,885   |   |      |   | 173,384  
|Dividends                                                    |  |                               | 2,855     |   |      |   | 4,267    
|Other interest income                                        |  |                               | 6,050     |   |      |   | 3,427    
|Interest on federal funds sold                               |  |                               | 12,748    |   |      |   | 23,814   
|                                                             |  |                               |           |   |      |   |          
|Total interest and dividend income                           |  |                               | 3,312,275 |   |      |   | 3,396,307
|                                                             |  |                               |           |   |      |   |          
|INTEREST EXPENSE                                             |  |                               |           |   |      |   |          
|Deposits                                                     |  |                               | 981,451   |   |      |   | 1,170,363
|Federal funds purchased and repurchase agreements            |  |                               | 55,105    |   |      |   | 34,172   
|FHLB borrowings                                              |  |                               | 29,268    |   |      |   |         
|                                                             |  |                               |           |   |      |   |          
|Total interest expense                                       |  |                               | 1,065,824 |   |      |   | 1,204,535
|                                                             |  |                               |           |   |      |   |          
|Net interest income                                          |  |                               | 2,246,451 |   |      |   | 2,191,772
|PROVISION FOR POSSIBLE LOAN LOSSES                           |  |                               | 30,000    |   |      |   | 90,000   
|                                                             |  |                               |           |   |      |   |          
|Net interest income after provision for possible loan losses |  |                               | 2,216,451 |   |      |   | 2,101,772
|                                                             |  |                               |           |   |      |   |          
|NONINTEREST INCOME                                           |  |                               |           |   |      |   |          
|Service charges and other fees                               |  |                               | 192,494   |   |      |   | 166,328  
|Net losses on available for sale securities                  |  |                               | (2,501    | ) |      |   |         
|Other operating income                                       |  |                               | 96,861    |   |      |   | 98,790   
|                                                             |  |                               |           |   |      |   |          
|Total noninterest income                                     |  |                               | 286,854   |   |      |   | 265,118  
|                                                             |  |                               |           |   |      |   |          
|NONINTEREST EXPENSE                                          |  |                               |           |   |      |   |          
|Salary and employee benefits                                 |  |                               | 891,303   |   |      |   | 795,744  
|Net occupancy expense of premises                            |  |                               | 261,325   |   |      |   | 249,835  
|Other operating expenses                                     |  |                               | 471,506   |   |      |   | 503,837  
|                                                             |  |                               |           |   |      |   |          
|Total noninterest expense                                    |  |                               | 1,624,134 |   |      |   | 1,549,416
|                                                             |  |                               |           |   |      |   |          
|Income before income taxes                                   |  |                               | 879,171   |   |      |   | 817,474  
|INCOME TAXES                                                 |  |                               | 220,431   |   |      |   | 198,003  
|                                                             |  |                               |           |   |      |   |          
|Net income                                                   |  | $                             | 658,740   |   |      | $ | 619,471  
|                                                             |  |                               |           |   |      |   |          
|WEIGHTED AVERAGE SHARES OUTSTANDING                          |  |                               | 1,528,443 |   |      |   | 1,538,443
|                                                             |  |                               |           |   |      |   |          
|EARNINGS PER COMMON SHARE                                    |  | $                             | 0.43      |   |      | $ | 0.40     
|                                                             |  |                               |           |   |      |   |          



The accompanying notes
are an integral part of the consolidated financial statements.



4



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##### Table of Contents

First West Virginia Bancorp, Inc.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY

(Unaudited)



|                                                                                   |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|---------------------------------------------------------------------------------- |  | ------------ |  | ------- | --------- | ----------------- | - | --------- | -------------- | - | ---------- | ----------------------------------------------- |  | - | ---------------------- | - |  | ----- | --------- | - |  | - | --------- | - |  | - | ---------- | -
|                                                                                   |  | Common Stock |  | Surplus |           | Retained Earnings |   |           | Treasury Stock |   |            | Accumulated Other Compre- hensive Income (loss) |  |   | Compre- hensive Income |   |  | Total |          
|                                                                                   |  | Shares       |  | Amount  |           |                   |   |           |                |  
|BALANCE, DECEMBER 31, 2002                                                         |  | 1,538,443    |  | $       | 7,692,215 |                   | $ | 4,982,606 |                | $ | 8,566,520  |                                                 |  | $ |                       |   |  | $     | 1,218,292 |   |  |   |           |   |  | $ | 22,459,633 |  
|Comprehensive income:                                                              |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|Net income                                                                         |  |             |  |         |          |                   |   |          |                |   | 619,471    |                                                 |  |   |                       |   |  |       |          |   |  | $ | 619,471   |   |  |   | 619,471    |  
|Other comprehensive income, net of tax                                             |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|Unrealized gains on securities net of reclassification adjustment (see disclosure) |  |             |  |         |          |                   |   |          |                |   |           |                                                 |  |   |                       |   |  |       | (184,272  | ) |  |   | (184,272  | ) |  |   | (184,272   | )
|                                                                                   |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|Comprehensive income                                                               |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  | $ | 435,199   |   |  |   |            |  
|                                                                                   |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|Cash dividend ($.18 per share)                                                     |  |             |  |         |          |                   |   |          |                |   | (276,920   | )                                               |  |   |                       |   |  |       |          |   |  |   |           |   |  |   | (276,920   | )
|                                                                                   |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|BALANCE, MARCH 31, 2003                                                            |  | 1,538,443    |  | $       | 7,692,215 |                   | $ | 4,982,606 |                | $ | 8,909,071  |                                                 |  | $ |                       |   |  | $     | 1,034,020 |   |  |   |           |   |  | $ | 22,617,912 |  
|                                                                                   |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|                                                                                   |  |              |  |         |           |                   |  
|                                                                                   |  | Common Stock |  | Surplus |           | Retained Earnings |   |           | Treasury Stock |   |            | Accumulated Other Compre- hensive Income (loss) |  |   | Compre- hensive Income |   |  | Total |          
|                                                                                   |  | Shares       |  | Amount  |           |                   |   |           |                |  
|BALANCE, DECEMBER 31, 2003                                                         |  | 1,538,443    |  | $       | 7,692,215 |                   | $ | 4,982,606 |                | $ | 9,961,698  |                                                 |  | $ | (228,100               | ) |  | $     | 622,196   |   |  |   |           |   |  | $ | 23,030,615 |  
|Comprehensive income:                                                              |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|Net income                                                                         |  |             |  |         |          |                   |   |          |                |   | 658,740    |                                                 |  |   |                       |   |  |       |          |   |  | $ | 658,740   |   |  |   | 658,740    |  
|Other comprehensive income, net of tax                                             |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|Unrealized gains on securities net of reclassification adjustment (see disclosure) |  |             |  |         |          |                   |   |          |                |   |           |                                                 |  |   |                       |   |  |       | 343,974   |   |  |   | 343,974   |   |  |   | 343,974    |  
|                                                                                   |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|Comprehensive income                                                               |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  | $ | 1,002,714 |   |  |   |            |  
|                                                                                   |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|Cash dividend ($.19 per share)                                                     |  |             |  |         |          |                   |   |          |                |   | (290,404   | )                                               |  |   |                       |   |  |       |          |   |  |   |           |   |  |   | (290,404   | )
|                                                                                   |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  
|BALANCE, MARCH 31, 2004                                                            |  | 1,538,443    |  | $       | 7,692,215 |                   | $ | 4,982,606 |                | $ | 10,330,034 |                                                 |  | $ | (228,100               | ) |  | $     | 966,170   |   |  |   |           |   |  | $ | 23,742,925 |  
|                                                                                   |  |              |  |         |           |                   |   |           |                |   |            |                                                 |  |   |                        |   |  |       |           |   |  |   |           |   |  |   |            |  



|                                                                   |  |                                      |         |   |      |   |          |  
|------------------------------------------------------------------ |  | ------------------------------------ | ------- | - | ---- | - | -------- | -
|                                                                   |  | For the Three Months Ended March 31, |        
|                                                                   |  | 2004                                 |         |   | 2003 |  
|Disclosure of reclassification amount, net of tax:                 |  |                                      |         |   |      |   |          |  
|Unrealized holding gains (losses) arising during the period        |  | $                                    | 342,414 |   |      | $ | (184,272 | )
|Less reclassification adjustment for losses included in net income |  |                                      | (1,560  | ) |      |   |         |  
|                                                                   |  |                                      |         |   |      |   |          |  
|Net unrealized gains (losses) on securities                        |  | $                                    | 343,974 |   |      | $ | (184,272 | )
|                                                                   |  |                                      |         |   |      |   |          |  



The accompanying notes
are an integral part of the consolidated financial statements.



5



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##### Table of Contents

First West Virginia Bancorp, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)



|                                                                                  |  |                                      |             |   |      |   |             |  
|--------------------------------------------------------------------------------- |  | ------------------------------------ | ----------- | - | ---- | - | ----------- | -
|                                                                                  |  | For the Three Months Ended March 31, |            
|                                                                                  |  | 2004                                 |             |   | 2003 |  
|OPERATING ACTIVITIES                                                              |  |                                      |             |   |      |   |             |  
|Net income                                                                        |  | $                                    | 658,740     |   |      | $ | 619,471     |  
|Adjustments to reconcile net income to net cash provided by operating activities: |  |                                      |             |   |      |   |             |  
|Provision for loan losses                                                         |  |                                      | 30,000      |   |      |   | 90,000      |  
|Depreciation and amortization                                                     |  |                                      | 112,971     |   |      |   | 106,793     |  
|Amortization of investment securities, net                                        |  |                                      | 159,951     |   |      |   | 194,432     |  
|Investment security losses                                                        |  |                                      | 2,501       |   |      |   |            |  
|Gain on sales of premises and equipment                                           |  |                                      | (3,726      | ) |      |   | (2,396      | )
|Increase in interest receivable                                                   |  |                                      | (164,424    | ) |      |   | (230,236    | )
|Increase (decrease) in interest payable                                           |  |                                      | 283         |   |      |   | (28,873     | )
|Other, net                                                                        |  |                                      | 6,600,994   |   |      |   | (624,998    | )
|                                                                                  |  |                                      |             |   |      |   |             |  
|Net cash provided by operating activities                                         |  |                                      | 7,397,290   |   |      |   | 124,193     |  
|                                                                                  |  |                                      |             |   |      |   |             |  
|INVESTING ACTIVITIES                                                              |  |                                      |             |   |      |   |             |  
|Net increase (decrease) in loans, net of charge-offs                              |  |                                      | (4,608,211  | ) |      |   | 1,628,998   |  
|Proceeds from sales of securities available-for-sale                              |  |                                      | 10,553      |   |      |   | 1,037,872   |  
|Proceeds from maturities of securities available-for-sale                         |  |                                      | 15,588,793  |   |      |   | 30,959,000  |  
|Proceeds from maturities of securities held-to-maturity                           |  |                                      | 610,000     |   |      |   | 1,190,000   |  
|Principal collected on mortgage-backed securities                                 |  |                                      | 3,593,562   |   |      |   | 7,429,707   |  
|Purchases of securities available-for-sale                                        |  |                                      | (15,026,698 | ) |      |   | (47,783,311 | )
|Recoveries on loans previously charged-off                                        |  |                                      | 22,050      |   |      |   | 4,790       |  
|Purchases of premises and equipment                                               |  |                                      | (21,156     | ) |      |   | (43,743     | )
|Proceeds from sales of premises and equipment                                     |  |                                      | 14,101      |   |      |   | 166,907     |  
|                                                                                  |  |                                      |             |   |      |   |             |  
|Net cash used in (provided by) investing activities                               |  |                                      | 182,994     |   |      |   | (5,409,780  | )
|                                                                                  |  |                                      |             |   |      |   |             |  
|FINANCING ACTIVITIES                                                              |  |                                      |             |   |      |   |             |  
|Net increase (decrease) in deposits                                               |  |                                      | (1,552,383  | ) |      |   | 9,144,086   |  
|Dividends paid                                                                    |  |                                      | (290,404    | ) |      |   | (276,920    | )
|Increase (decrease) in short-term borrowings                                      |  |                                      | (1,543,145  | ) |      |   | 48,128      |  
|Decrease in FHLB borrowings                                                       |  |                                      | (9,418      | ) |      |   |            |  
|                                                                                  |  |                                      |             |   |      |   |             |  
|Net cash provided by (used in) financing activities                               |  |                                      | (3,395,350  | ) |      |   | 8,915,294   |  
|                                                                                  |  |                                      |             |   |      |   |             |  
|                                                                                  |  |                                     
|INCREASE IN CASH AND CASH EQUIVALENTS                                             |  |                                      | 4,184,934   |   |      |   | 3,629,707   |  
|                                                                                  |  |                                     
|CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR                                      |  |                                      | 7,024,394   |   |      |   | 12,500,496  |  
|                                                                                  |  |                                      |             |   |      |   |             |  
|CASH AND CASH EQUIVALENTS, END OF YEAR                                            |  | $                                    | 11,209,328  |   |      | $ | 16,130,203  |  
|                                                                                  |  |                                      |             |   |      |   |             |  
|Supplemental Disclosures:                                                         |  |                                      |             |   |      |   |             |  
|Cash Paid for Interest                                                            |  | $                                    | 1,065,541   |   |      | $ | 1,233,408   |  
|Cash Paid for Income Taxes                                                        |  | $                                    | 45,000      |   |      | $ | 137,599     |  



The accompanying notes
are an integral part of the consolidated financial statements.



6



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##### Table of Contents

First West Virginia Bancorp, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2004 AND 2003

(Unaudited)



Note 1 - Critical Accounting Policies



The accounting and reporting policies of First West Virginia Bancorp, Inc. ( the Company) and its subsidiary were prepared in accordance with accounting
principles generally accepted in the United States of America, (US GAAP) and to general practices within the financial services industry. The preparation of financial statements in conformity with US GAAP requires management to make
estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Management has identified the accounting policies described below as those that, due to
the judgments, estimates and assumptions inherent in those policies, are critical to an understanding of the Companys consolidated financial statements and managements discussion and analysis.



INCOME RECOGNITION



The Company recognizes interest income by methods conforming to US GAAP that include general
accounting practices within the financial services industry. Interest income on loans and investment securities is recognized by methods that result in level rates of return on principal amounts outstanding, including yield adjustments resulting
from the amortization of loan costs and premiums on investment securities and accretion of loan fees and discounts on investment securities.



In the event management believes collection of all or a portion of contractual interest on a loan has become doubtful, which generally occurs after the loan is 90 days
past due, the accrual of interest is discontinued. In addition, previously accrued interest deemed uncollectible that was recognized in income is reversed. Interest received on nonaccrual loans is included in income only if principal recovery is
reasonably assured. A nonaccrual loan is restored to accrual status when it is brought current or has performed in accordance with contractual terms for a reasonable period of time, and the collectibility of the total contractual principal and
interest is no longer doubtful.



ALLOWANCE FOR LOAN LOSSES



In general, determining the amount of the allowance for loan losses
requires significant judgment and the use of estimates by management. The Company maintains an allowance for loan losses to absorb probable losses in the loan portfolio based on a quarterly analysis of the portfolio. This formal analysis determines
an appropriate level and allocation of the allowance for loan losses among loan types and resulting provision for loan losses by considering factors affecting loan losses, including specific losses, levels and trends in impaired and nonperforming
loans, historical loan loss experience, current national and local economic conditions, volume, growth and composition of the portfolio, regulatory guidance and other relevant factors. Management continually monitors the loan portfolio through
reviews of past due loans and all significant loans which are considered to be potential problem loans on a monthly basis. The internal loan review function provides for an independent review to evaluate the adequacy of the allowance. The provision
could increase or decrease each quarter based upon the results of managements formal analysis.



The amount of the allowance for loan losses for the various loan types represents managements estimate of expected losses from existing loans based upon specific allocations for individual lending relationships
and historical loss experience for each category of homogeneous loans. Impaired loans are commercial and commercial real estate loans for which it is probable the Company will not be able to collect all amounts due according to the contractual terms
of the loan agreement. The Company individually evaluates such loans for impairment and does not aggregate loans by major risk classifications. The definition of impaired loans is not the same as the definition of nonaccrual
loans, although the two categories overlap. The Company may choose to place a loan on nonaccrual status due to payment delinquency or uncertain collectibility while not classifying the loan as impaired, provided the loan is not a commercial or
commercial real estate classification. Factors considered by management in determining impairment include payment status and collateral value. The amount of impairment for these types of loans is determined by the difference between the present
value of the expected cash flows related to the loan, using the original interest rate, and its recorded value, or as a practical expedient in the case of collateralized loans, the difference between the fair value of the collateral and the recorded
amount of the loans. When foreclosure is probable, impairment is measured based on the fair value of the collateral. While allocations are made to specific loans and pools of loans, the allowance is available for all loan losses.



7



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##### Table of Contents

First West Virginia Bancorp, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)

March 31, 2004 AND
2003

(Unaudited)



Note 1 - Critical Accounting Policies - (Continued)



Mortgage loans secured by one-to-four family properties and all consumer loans are large
groups of smaller-balance homogeneous loans and are measured for impairment collectively. Loans that experience insignificant payment delays, which are defined as 90 days or less, generally are not classified as impaired. Management determines the
significance of payment delays on a case-by-case basis taking into consideration all circumstances concerning the loan, the credit worthiness and payment history of the borrower, the length of the payment delay, and the amount of shortfall in
relation to the principal and interest owed.



Individual loan reviews are based
upon specific quantitative and qualitative criteria, including the size of the loan, loan quality ratings, value of collateral, repayment ability of borrowers, and historical experience factors. The historical experience factors utilized for
individual loan reviews are based upon past loss experience, known trends in losses and delinquencies, the growth of loans in particular markets and industries, and known changes in economic conditions in the particular lending markets. Allowances
for homogeneous loans (such as residential mortgage loans, personal loans, etc.) are evaluated based upon historical loss experience, trends in losses and delinquencies, growth of loans in particular markets, and known changes in economic conditions
in each lending market. There can be no assurance the allowance for loan losses will be adequate to cover all losses, but management believes the allowance for loan losses in the amount of $2,188,215 at March 31, 2004, was adequate to provide for
probable losses from existing loans based on information currently available. While management uses available information to provide for loan losses, the ultimate collectibility of a substantial portion of the loan portfolio, and the need for future
additions to the allowance, will be based on changes in economic conditions and other relevant factors. As such, an adverse change in economic activity could reduce cash flows for both commercial and individual borrowers, which would likely cause
the Company to experience increases in problem assets, delinquencies and losses on loans.



INVESTMENT SECURITIES



Investment securities are classified at the time of purchase, based on managements intention and ability, as securities available for sale or held to maturity. Debt securities classified as held to maturity are stated at cost adjusted
for amortization of premium and accretion of discount which are computed using the interest method and recognized as adjustments of interest income. Certain other debt and equity securities have been classified as available for sale to serve
principally as a source of liquidity. Unrealized holding gains and losses for available-for-sale securities are reported as a separate component of stockholders equity, net of tax, until realized. Realized securities gains and losses are
computed using the specific identification method. Interest and dividends on investment securities are recognized as income when earned.



Common stock of the Federal Home Loan Bank (FHLB) and Federal Reserve Bank represents ownership interest in institutions that are wholly owned by other
financial institutions. These equity securities are accounted for at cost and are classified with other assets.



While temporary changes in the market value of available-for-sale securities are not recognized in earnings, a decline in fair value below amortized cost deemed to be
other-than-temporary results in an adjustment to the cost basis of the investment, with a corresponding loss charged against earnings. Management evaluates the investment securities for other-than-temporary declines in estimated fair value on a
quarterly basis. This analysis requires management to consider various factors in order to determine if a decline in estimated fair value is temporary or other-than-temporary. These factors include duration and magnitude of the decline in value, the
financial condition of the issuer, and the companys ability and intent to continue holding the investment for a period of time sufficient to allow for any anticipated recovery in market value. At March 31, 2004, there were no investment
securities identified by management to be other-than-temporarily impaired. If investments decline in fair value due to adverse changes in the financial markets, charges to income could occur in future periods.



8



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##### Table of Contents

First West Virginia Bancorp, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)

March 31, 2004 AND
2003

(Unaudited)



Note 1 - Critical Accounting Policies - (Continued)



GOODWILL AND OTHER INTANGIBLE ASSETS



The Company purchased the deposits of another financial institution in 2001. An identifiable
intangible asset resulted from the purchase of the core deposits and, as such, are amortized into noninterest expense on the straight-line basis over the period the Company expects to benefit from such assets (7 years). While management feels the
assumptions and variables used to value the acquisition was reasonable, the use of different, but still reasonable, assumptions could produce different results. The Company recognized amortization expense of $22,188 in both of the three months ended
March 31, 2004 and 2003. The unamortized balance from the purchase of these core deposit intangible assets is $347,609 and $369,797 at March 31, 2004 and December 31, 2003, respectively.



The Company has approximately $1.6 million of goodwill, resulting from the purchase of a less-than-whole financial institution. As such,
goodwill value is supported ultimately by revenue that is driven by the volume of business transacted. A decline in earnings as a result of a lack of growth or the inability to deliver cost effective services over sustained periods can lead to
impairment of goodwill that could adversely impact earnings in future periods. Goodwill and other intangibles are periodically reviewed for impairment. No impairment losses were recognized. Additionally, future events could cause management to
conclude that impairment indicators exist and that the goodwill is impaired, which would result in the Company recording an impairment loss. Any resulting impairment loss could have a material, adverse impact on the Companys financial
condition and results of operations.



Income Taxes



The Company and its subsidiary file a consolidated federal income tax return. Deferred
tax assets and liabilities are reflected at currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred
tax assets and liabilities are adjusted through the provision for income taxes. Deferred income tax expenses or benefits are based on the changes in the deferred tax asset or liability from period to period. The provision for income taxes during the
current period is at a rate which management believes will approximate the effective rate for the year.



Cash Flows



Cash and cash
equivalents consist of cash and due from banks and federal funds sold.



9



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



First West Virginia Bancorp, Inc., a West Virginia corporation headquartered in Wheeling, West Virginia, has one
wholly-owned subsidiary: Progressive Bank, N.A., which operates in Wheeling, Wellsburg, Moundsville, New Martinsville, Buckhannon and Weston, West Virginia and Bellaire, Ohio. Following is a discussion and analysis of the significant changes in the
financial condition and results of operations of First West Virginia Bancorp, Inc., (the Holding Company), and its subsidiary for the three months ended March 31, 2004 and 2003. This discussion and analysis should be read in conjunction with the
Consolidated Financial Statements, Notes, and tables contained in this report, as well as with the Holding Companys Annual Report contained on Form 10-K for the year ended December 31, 2003.



Forward-Looking Information



Certain information contained in this report, which are not historical facts, may be
forward-looking statements that involve risks and uncertainties. These statements are subject to important factors that could cause action results to differ materially from those contemplated by such statements, including without limitation, the
effect of changing economic conditions, changes in interest rates, changes in lending activities, changes in state and federal regulations, and other external factors which may materially impact the Companys operational and financial
performance.



OVERVIEW



The Holding Company reported net income of $658,740 or $.43 per share for the three months
ended March 31, 2004 as compared to $619,471 for the same period during 2003. The 6.3% increase in earnings during the first quarter of 2004 over 2003 was primarily attributed to increased net interest income and noninterest income and the decrease
in the provision for loan losses, partially offset by the increase in noninterest expense.



Operational earnings improved with net interest income increasing $54,679 or 2.5%, during the three months ended March 31, 2004 as compared to the same period in 2003. Net interest income increased primarily due to
the decrease in the interest rates paid on interest bearing liabilities.



The
return on average assets (ROA), which measures the effectiveness of asset utilization to produce net income, was .94% at March 31, 2004 and 2003. The return on average equity (ROE), which measures the return on the stockholders investment, was
11.78% at March 31, 2004 compared to 11.76% at March 31, 2003. The Board of Directors declared and paid cash dividends of $.19 per share during the first quarter of 2004 as compared to $.18 during the same period in 2003.



The Holding Company ended the first quarter of 2004 with total assets of $284,596,923. Loans
increased during the first quarter of 2004 by $4,439,508, or 3.0%, to $151,150,002. Total deposits decreased in the first quarter of 2004 by $1,552,383, or .6% since December 31, 2003 and was primarily due to a decrease in savings and time deposits.



The allowance for loan losses amounted to $2,188,215 or 1.5% of total loans at
March 31, 2004, compared to $2,304,868 or 1.6% of total loans at December 31, 2003. Non-performing assets were $2,140,000 at March 31, 2004, as compared to $2,169,000 at December 31, 2003.



Table One is a five-year summary of Selected Financial Data of the Holding Company. The
sections that follow discuss in more detail the information summarized in Table One.



10



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##### Table of Contents

Table One

SELECTED FINANCIAL DATA



|                                                  |  |                                               |         |   |                          |   |         |      |  |   |         |   |  |      |         |   |      |   |         |   |  |   |         |  
|------------------------------------------------- |  | --------------------------------------------- | ------- | - | ------------------------ | - | ------- | ---- |  | - | ------- | - |  | ---- | ------- | - | ---- | - | ------- | - |  | - | ------- | -
|                                                  |  | (Dollars in thousands, except per share data) |        
|                                                  |  | (Unaudited)                                   |         |   |                          |   |         |      |  |   |         |   |  |      |        
|                                                  |  | Three Months Ended March 31,                  |         |   | Years ended December 31, |  
|                                                  |  | 2004                                          |         |   | 2003                     |   |         | 2003 |  |   | 2002    |   |  | 2001 |         |   | 2000 |  
|SUMMARY OF OPERATIONS                             |  |                                               |         |   |                          |   |         |      |  |   |         |   |  |      |         |   |      |   |         |   |  |   |         |  
|Total interest income                             |  | $                                             | 3,312   |   |                          | $ | 3,396   |      |  | $ | 13,319  |   |  | $    | 14,309  |   |      | $ | 14,772  |   |  | $ | 14,869  |  
|Total interest expense                            |  |                                               | 1,066   |   |                          |   | 1,204   |      |  |   | 4,603   |   |  |      | 5,101   |   |      |   | 6,422   |   |  |   | 7,155   |  
|Net interest income                               |  |                                               | 2,246   |   |                          |   | 2,192   |      |  |   | 8,716   |   |  |      | 9,208   |   |      |   | 8,350   |   |  |   | 7,714   |  
|Provision for loan losses                         |  |                                               | 30      |   |                          |   | 90      |      |  |   | 435     |   |  |      | 540     |   |      |   | 573     |   |  |   | 436     |  
|Total other income                                |  |                                               | 287     |   |                          |   | 265     |      |  |   | 1,346   |   |  |      | 1,033   |   |      |   | 942     |   |  |   | 880     |  
|Total other expenses                              |  |                                               | 1,624   |   |                          |   | 1,550   |      |  |   | 6,342   |   |  |      | 6,062   |   |      |   | 5,324   |   |  |   | 4,816   |  
|Income before income taxes                        |  |                                               | 879     |   |                          |   | 817     |      |  |   | 3,285   |   |  |      | 3,639   |   |      |   | 3,395   |   |  |   | 3,341   |  
|Net income                                        |  |                                               | 659     |   |                          |   | 619     |      |  |   | 2,518   |   |  |      | 2,674   |   |      |   | 2,412   |   |  |   | 2,326   |  
|PER SHARE DATA (1)                                |  |                                               |         |   |                          |   |         |      |  |   |         |   |  |      |         |   |      |   |         |   |  |   |         |  
|Net income                                        |  | $                                             | 0.43    |   |                          | $ | 0.40    |      |  | $ | 1.64    |   |  | $    | 1.74    |   |      | $ | 1.57    |   |  | $ | 1.51    |  
|Cash dividends declared                           |  |                                               | 0.19    |   |                          |   | 0.18    |      |  |   | 0.73    |   |  |      | 0.69    |   |      |   | 0.68    |   |  |   | 0.64    |  
|Book value per share                              |  |                                               | 15.53   |   |                          |   | 14.70   |      |  |   | 15.07   |   |  |      | 14.60   |   |      |   | 13.16   |   |  |   | 11.85   |  
|AVERAGE BALANCE SHEET SUMMARY                     |  |                                               |         |   |                          |   |         |      |  |   |         |   |  |      |         |   |      |   |         |   |  |   |         |  
|Total loans, net                                  |  | $                                             | 149,006 |   |                          | $ | 135,662 |      |  | $ | 137,826 |   |  | $    | 131,383 |   |      | $ | 118,224 |   |  | $ | 112,579 |  
|Investment securities                             |  |                                               | 112,579 |   |                          |   | 108,862 |      |  |   | 117,758 |   |  |      | 93,962  |   |      |   | 73,639  |   |  |   | 69,548  |  
|Deposits - interest bearing                       |  |                                               | 218,060 |   |                          |   | 212,584 |      |  |   | 217,064 |   |  |      | 200,170 |   |      |   | 168,820 |   |  |   | 155,172 |  
|Stockholders equity                              |  |                                               | 22,503  |   |                          |   | 21,347  |      |  |   | 21,884  |   |  |      | 20,302  |   |      |   | 18,902  |   |  |   | 17,448  |  
|Total assets                                      |  |                                               | 281,898 |   |                          |   | 266,645 |      |  |   | 277,952 |   |  |      | 252,543 |   |      |   | 217,006 |   |  |   | 203,529 |  
|BALANCE SHEET                                     |  |                                               |         |   |                          |   |         |      |  |   |         |   |  |      |         |   |      |   |         |   |  |   |         |  
|Investments                                       |  | $                                             | 114,858 |   |                          | $ | 114,752 |      |  | $ | 119,245 |   |  | $    | 108,065 |   |      | $ | 82,202  |   |  | $ | 72,242  |  
|Loans                                             |  |                                               | 151,150 |   |                          |   | 135,124 |      |  |   | 146,711 |   |  |      | 136,772 |   |      |   | 120,944 |   |  |   | 114,053 |  
|Other assets                                      |  |                                               | 18,589  |   |                          |   | 23,824  |      |  |   | 18,155  |   |  |      | 19,517  |   |      |   | 28,884  |   |  |   | 21,598  |  
|                                                  |  |                                               |         |   |                          |   |         |      |  |   |         |   |  |      |         |   |      |   |         |   |  |   |         |  
|Total Assets                                      |  | $                                             | 284,597 |   |                          | $ | 273,700 |      |  | $ | 284,111 |   |  | $    | 264,354 |   |      | $ | 232,030 |   |  | $ | 207,893 |  
|                                                  |  |                                               |         |   |                          |   |         |      |  |   |         |   |  |      |         |   |      |   |         |   |  |   |         |  
|Deposits                                          |  | $                                             | 240,395 |   |                          | $ | 240,520 |      |  | $ | 241,947 |   |  | $    | 231,376 |   |      | $ | 203,772 |   |  | $ | 173,669 |  
|Federal funds purchased and repurchase agreements |  |                                               | 13,546  |   |                          |   | 9,086   |      |  |   | 15,089  |   |  |      | 9,038   |   |      |   | 6,538   |   |  |   | 14,526  |  
|FHLB borrowings                                   |  |                                               | 2,454   |   |                          |   |        |      |  |   | 2,464   |   |  |      |        |   |      |   |        |   |  |   |        |  
|Other liabilities                                 |  |                                               | 4,459   |   |                          |   | 1,476   |      |  |   | 1,580   |   |  |      | 1,480   |   |      |   | 1,471   |   |  |   | 1,473   |  
|Stockholders equity                              |  |                                               | 23,743  |   |                          |   | 22,618  |      |  |   | 23,031  |   |  |      | 22,460  |   |      |   | 20,249  |   |  |   | 18,225  |  
|                                                  |  |                                               |         |   |                          |   |         |      |  |   |         |   |  |      |         |   |      |   |         |   |  |   |         |  
|Total Liabilities and Stockholders equity        |  | $                                             | 284,597 |   |                          | $ | 273,700 |      |  | $ | 284,111 |   |  | $    | 264,354 |   |      | $ | 232,030 |   |  | $ | 207,893 |  
|                                                  |  |                                               |         |   |                          |   |         |      |  |   |         |   |  |      |         |   |      |   |         |   |  |   |         |  
|SELECTED RATIOS                                   |  |                                               |         |   |                          |   |         |      |  |   |         |   |  |      |         |   |      |   |         |   |  |   |         |  
|Return on average assets                          |  |                                               | 0.94    | % |                          |   | 0.94    | %    |  |   | 0.91    | % |  |      | 1.06    | % |      |   | 1.11    | % |  |   | 1.14    | %
|Return on average equity                          |  |                                               | 11.78   | % |                          |   | 11.76   | %    |  |   | 11.51   | % |  |      | 13.17   | % |      |   | 12.76   | % |  |   | 13.33   | %
|Average equity to average assets                  |  |                                               | 7.98    | % |                          |   | 8.01    | %    |  |   | 7.87    | % |  |      | 8.04    | % |      |   | 8.71    | % |  |   | 8.57    | %
|Dividend payout ratio (1)                         |  |                                               | 44.19   | % |                          |   | 45.00   | %    |  |   | 44.51   | % |  |      | 39.66   | % |      |   | 43.31   | % |  |   | 42.38   | %
|Loan to Deposit ratio                             |  |                                               | 62.88   | % |                          |   | 56.18   | %    |  |   | 60.64   | % |  |      | 59.11   | % |      |   | 59.35   | % |  |   | 65.67   | %

---

|(1) | Adjusted for the 2 percent common stock dividend to stockholders of record as of December 1, 2000.
|--- | --------------------------------------------------------------------------------------------------



11



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



EARNINGS ANALYSIS



Net Interest Income



Net interest income, which is the difference between interest earned on loans and investments and interest paid on deposits and other liabilities, is the primary source
of earnings for the Holding Company. Changes in the volume and mix of earning assets and interest bearing liabilities combined with changes in market rates of interest greatly effect net interest income. Table Two presents the average balance sheets
and an interest rate analysis for the three months ended March 31, 2004 and 2003.



Net interest income was $2,246,451 for the three months ended March 31, 2004, an increase of $54,679 or 2.5%, from the same period in 2003. Net interest income increased during the first quarter of 2004 compared to the same period in 2003
primarily from the decline in the interest rates paid on deposit liabilities. The changes in the volume and mix of earning assets and interest bearing liabilities combined with the changes in the market rates of interest resulted in taxable
equivalent net interest yields on average earning assets of 3.66% at March 31, 2004, as compared to 3.61% at December 31, 2003 and 3.83% at March 31, 2003.



During the three months ended March 31, 2004, interest expense decreased $138,711 or 11.5% as compared to the same period in 2003. The decrease in the interest rates paid
on interest bearing liabilities, which were offset in part by an increase in the average volume of interest bearing liabilities primarily resulted in the decline in interest expense during the first quarter of 2004. The average yield paid on
interest bearing liabilities decreased .17%, from 2.00% at December 31, 2003 to 1.83% at March 31, 2004. The decrease in the average yield on interest bearing liabilities during the first quarter of 2004 was primarily due to the decrease in the
interest rates paid on time deposits and savings deposits.



Interest income on
investment securities decreased $62,143 or 6.2% during the three months ended March 31, 2004 over 2003. The decrease in the average volume of investment securities contributed to the decrease in net interest income during the first quarter of 2004.
The average volume of investment securities decreased $5,179,000 since December 31, 2003.



Interest and fees on loans decreased $12,034 or .5% for the three month period ended March 31, 2004 as compared the same period in 2003. The decrease in interest and fees on loans was primarily due to the decline in
the yield earned on loans. The taxable equivalent yield on loans decreased from 7.05% at December 31, 2003 to 6.63% at March 31, 2004.



Noninterest Income



Service charges and other fees represent the major component of noninterest income. These charges are earned from assessments made on checking and savings accounts.
Service charges increased $26,166 during the three months ended March 31, 2004, up 15.7%, from the same period in 2003. The increase in service charges primarily resulted from an increase in the number of charges assessed on deposit accounts
combined with an increase in the number of deposit holders compared to the prior year.



Sales of investment securities for the three month period ended March 31, 2004 were primarily the result of sales by the Holding Company. The Holding Company accounted for securities gains of $56 and securities losses of $2,557 during the
period ended March 31, 2004 and those sales were attributable to sales of marketable equity securities. There were no sales of investment securities during the three month period ended March 31, 2003.



12



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



Noninterest Income (Continued)



Other operating income represents fees from safe deposit box rentals, sales of checkbooks, sales of cashiers checks and money orders,
utility collections, ATM charges and card fees, home equity credit line fees, credit life commissions, credit card fees and commissions and various other charges and fees related to normal customer banking relationships. During the first quarter of
2004, other operating income decreased of $1,929 or 2.0% compared to the same period in 2003. The decrease in other operating income resulted primarily from a decrease in ATM fees, utility collection fees, and credit card fees, offset in part by an
increase in checkbook income and safe deposit box rental income during the first quarter of 2004.



Non-Interest Expense



Salary and
employee benefits is the largest component of noninterest expense. Salary and employee benefits increased $95,559 or 12.0% during the three months ended March 31, 2004 over the same period in 2003. The increase in salary and employee benefits in
2004 compared to 2003 was primarily due to the hiring of additional loan personnel and normal annual merit adjustments.



Occupancy expenses increased $11,490 or 4.6% during the three months ended March 31, 2004 compared to the same period in 2003. Increased equipment repair and maintenance
costs primarily contributed to the increase in occupancy expenses in 2004 as compared to 2003. The Company incurred additional maintenance costs with the operation of the internet web site and online banking program during the first quarter of 2004
compared to 2003.



The major components of other operating expenses include:
stationery and supplies, directors fees, service expense, postage and transportation, other taxes, advertising, and regulatory assessment and deposit insurance. Other operating expenses decreased $32,331 or 6.4% for the three months ended
March 31, 2004 over 2003. During the first quarter of 2004 compared to the same period in 2003, other operating expenses primarily declined due to decreases in stationery and supplies expense, regulatory assessments, postage expense, other taxes,
other expenses and service expense, offset in part by increases in director fees and advertising expense. Operational efficiencies were improved with the merger of the Companys two subsidiary banks in June 2003, thereby contributing to the
reduction in other operating expenses in 2004.



Income Taxes



Income tax expense for the period ended March 31, 2004 was $220,431, an
increase of 11.3% compared to the same period in 2003. Income tax expense increased primarily due to an increase in pre-taxable income of $61,697 during the first quarter of 2004 over the same period in 2003. Components of the income tax expense for
March 31, 2004 were $182,336 for federal taxes and $38,095 for West Virginia corporate net income taxes.



For federal income tax purposes, tax-exempt income is based on qualified state, county, and municipal bonds and loans. Tax-exempt income was $306,992 and $315,310 for the three month periods ended March 31, 2004 and
2003, respectively.



Federal income tax rates and West Virginia corporate net
income tax rates remain consistent at 34% and 9%, respectively, for the three months ended March 31, 2004 and 2003 and for the year ended December 31, 2003.



13



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##### Table of Contents

Table Two Average Balance Sheets and Interest Rate Analysis

(dollars in thousands)



The following table presents an average balance sheet, interest earned on interest bearing assets, interest paid on interest bearing liabilities, average interest rates
and interest differentials for the three months ended March 31, 2004 and 2003 and the year ended December 31, 2003. Average balance sheet information as of March 31, 2004 and March 31, 2003 and December 31, 2003 was compiled using the daily average
balance sheet. Loan fees and unearned discounts were included in income for average rate calculation purposes. Average yields on investment securities available for sale have been calculated based on amortized cost. Non-accrual loans were included
in the average balance computations; however, no interest was included in income subsequent to the non-accrual status classification.



|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------- | ------- | - | ----------------- | - | ------------ | -------------- | ---- | -------------- |  | - | -------- | - | ------------ | - | ------ | -------------- | ---- | - | -------- | - | ------------ | - |  | - | ----- |  | ---- | -
|                                                                                                                                                                                                                                                                                                                                                              |  | (Unaudited)    |         |   |                   |   |              | (Unaudited)    |     
|                                                                                                                                                                                                                                                                                                                                                              |  | March 31, 2004 |         |   | December 31, 2003 |   |              | March 31, 2003 |     
|                                                                                                                                                                                                                                                                                                                                                              |  | Average Volume |         |   | Interest          |   | Average Rate |                |      | Average Volume |  |   | Interest |   | Average Rate |   |        | Average Volume |      |   | Interest |   | Average Rate |  
|ASSETS:                                                                                                                                                                                                                                                                                                                                                       |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Investment securities:                                                                                                                                                                                                                                                                                                                                        |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|U.S. Treasury and other U. S. Government agencies                                                                                                                                                                                                                                                                                                             |  | $              | 53,144  |   |                   | $ | 400          |                | 3.03 | %              |  | $ | 46,358   |   |              | $ | 1,407  |                | 3.04 | % |          | $ | 38,565       |   |  | $ | 321   |  | 3.38 | %
|Mortgage backed securities                                                                                                                                                                                                                                                                                                                                    |  |                | 37,020  |   |                   |   | 314          |                | 3.41 | %              |  |   | 44,504   |   |              |   | 1,381  |                | 3.10 | % |          |   | 43,831       |   |  |   | 394   |  | 3.65 | %
|Obligations of states and political subdivisions                                                                                                                                                                                                                                                                                                              |  |                | 18,880  |   |                   |   | 171          |                | 3.64 | %              |  |   | 20,259   |   |              |   | 743    |                | 3.67 | % |          |   | 19,479       |   |  |   | 187   |  | 3.89 | %
|Other securities                                                                                                                                                                                                                                                                                                                                              |  |                | 3,535   |   |                   |   | 48           |                | 5.46 | %              |  |   | 6,637    |   |              |   | 343    |                | 5.17 | % |          |   | 6,987        |   |  |   | 93    |  | 5.40 | %
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Total Investment securities:                                                                                                                                                                                                                                                                                                                                  |  |                | 112,579 |   |                   |   | 933          |                | 3.33 | %              |  |   | 117,758  |   |              |   | 3,874  |                | 3.29 | % |          |   | 108,862      |   |  |   | 995   |  | 3.71 | %
|Interest bearing deposits                                                                                                                                                                                                                                                                                                                                     |  |                | 1,381   |   |                   |   | 3            |                | 0.87 | %              |  |   | 1,721    |   |              |   | 16     |                | 0.93 | % |          |   | 210          |   |  |   | 1     |  | 1.93 | %
|Federal funds sold                                                                                                                                                                                                                                                                                                                                            |  |                | 5,738   |   |                   |   | 13           |                | 0.91 | %              |  |   | 6,913    |   |              |   | 72     |                | 1.04 | % |          |   | 8,657        |   |  |   | 24    |  | 1.12 | %
|Loans, net of unearned income                                                                                                                                                                                                                                                                                                                                 |  |                | 149,006 |   |                   |   | 2,357        |                | 6.36 | %              |  |   | 137,826  |   |              |   | 9,329  |                | 6.77 | % |          |   | 135,662      |   |  |   | 2,369 |  | 7.08 | %
|Other earning assets                                                                                                                                                                                                                                                                                                                                          |  |                | 948     |   |                   |   | 6            |                | 2.55 | %              |  |   | 890      |   |              |   | 28     |                | 3.15 | % |          |   | 989          |   |  |   | 7     |  | 2.87 | %
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Total earning assets                                                                                                                                                                                                                                                                                                                                          |  |                | 269,652 |   |                   |   | 3,312        |                | 4.94 | %              |  |   | 265,108  |   |              |   | 13,319 |                | 5.02 | % |          |   | 254,380      |   |  |   | 3,396 |  | 5.41 | %
|Cash and due from banks                                                                                                                                                                                                                                                                                                                                       |  |                | 5,524   |   |                   |   |              |                |      |                |  |   | 5,822    |   |              |   |        |                |      |   |          |   | 5,295        |   |  |   |       |  |      |  
|Bank premises and equipment                                                                                                                                                                                                                                                                                                                                   |  |                | 3,891   |   |                   |   |              |                |      |                |  |   | 4,019    |   |              |   |        |                |      |   |          |   | 4,121        |   |  |   |       |  |      |  
|Other assets                                                                                                                                                                                                                                                                                                                                                  |  |                | 5,109   |   |                   |   |              |                |      |                |  |   | 5,110    |   |              |   |        |                |      |   |          |   | 4,916        |   |  |   |       |  |      |  
|Allowance for loan losses                                                                                                                                                                                                                                                                                                                                     |  |                | (2,278  | ) |                   |   |              |                |      |                |  |   | (2,107   | ) |              |   |        |                |      |   |          |   | (2,067       | ) |  |   |       |  |      |  
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Total Assets                                                                                                                                                                                                                                                                                                                                                  |  | $              | 281,898 |   |                   |   |              |                |      |                |  | $ | 277,952  |   |              |   |        |                |      |   |          | $ | 266,645      |   |  |   |       |  |      |  
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|LIABILITIES                                                                                                                                                                                                                                                                                                                                                   |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Time deposits                                                                                                                                                                                                                                                                                                                                                 |  | $              | 91,245  |   |                   | $ | 734          |                | 3.24 | %              |  | $ | 94,156   |   |              | $ | 3,285  |                | 3.49 | % |          | $ | 96,568       |   |  | $ | 887   |  | 3.73 | %
|Savings deposits                                                                                                                                                                                                                                                                                                                                              |  |                | 88,705  |   |                   |   | 218          |                | 0.99 | %              |  |   | 86,322   |   |              |   | 952    |                | 1.10 | % |          |   | 81,804       |   |  |   | 247   |  | 1.22 | %
|Interest bearing demand deposits                                                                                                                                                                                                                                                                                                                              |  |                | 38,110  |   |                   |   | 30           |                | 0.32 | %              |  |   | 36,586   |   |              |   | 142    |                | 0.39 | % |          |   | 34,212       |   |  |   | 36    |  | 0.43 | %
|Federal funds purchased and repurchase agreements                                                                                                                                                                                                                                                                                                             |  |                | 13,654  |   |                   |   | 55           |                | 1.62 | %              |  |   | 12,671   |   |              |   | 199    |                | 1.57 | % |          |   | 8,778        |   |  |   | 34    |  | 1.57 | %
|FHLB borrowings                                                                                                                                                                                                                                                                                                                                               |  |                | 2,459   |   |                   |   | 29           |                | 4.74 | %              |  |   | 544      |   |              |   | 26     |                | 4.78 | % |          |   |             |   |  |   |      |  |     |  
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Total interest bearing liabilities                                                                                                                                                                                                                                                                                                                            |  |                | 234,173 |   |                   |   | 1,066        |                | 1.83 | %              |  |   | 230,279  |   |              |   | 4,604  |                | 2.00 | % |          |   | 221,362      |   |  |   | 1,204 |  | 2.21 | %
|Demand deposits                                                                                                                                                                                                                                                                                                                                               |  |                | 23,488  |   |                   |   |              |                |      |                |  |   | 24,157   |   |              |   |        |                |      |   |          |   | 22,370       |   |  |   |       |  |      |  
|Other liabilities                                                                                                                                                                                                                                                                                                                                             |  |                | 1,734   |   |                   |   |              |                |      |                |  |   | 1,632    |   |              |   |        |                |      |   |          |   | 1,566        |   |  |   |       |  |      |  
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Total Liabilities                                                                                                                                                                                                                                                                                                                                             |  |                | 259,395 |   |                   |   |              |                |      |                |  |   | 256,068  |   |              |   |        |                |      |   |          |   | 245,298      |   |  |   |       |  |      |  
|STOCKHOLDERS EQUITY                                                                                                                                                                                                                                                                                                                                          |  |                | 22,503  |   |                   |   |              |                |      |                |  |   | 21,884   |   |              |   |        |                |      |   |          |   | 21,347       |   |  |   |       |  |      |  
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Total Liabilities and Stockholders Equity                                                                                                                                                                                                                                                                                                                    |  | $              | 281,898 |   |                   |   |              |                |      |                |  | $ | 277,952  |   |              |   |        |                |      |   |          | $ | 266,645      |   |  |   |       |  |      |  
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Net yield on earning assets                                                                                                                                                                                                                                                                                                                                   |  |                |         |   |                   | $ | 2,246        |                | 3.35 | %              |  |   |          |   |              | $ | 8,715  |                | 3.29 | % |          |   |              |   |  | $ | 2,192 |  | 3.49 | %
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|                                                                                                                                                                                                                                                                                                                                                             
|The fully taxable equivalent basis of interest income from obligations of states and political subdivisions has been determined using a combined Federal and State corporate income
tax rate of 40% for the three months ended March 31, 2004 and 2003, and the year ended December 31, 2003, respectively. The effect of this adjustment is presented below. | 
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |     
|Investment securities                                                                                                                                                                                                                                                                                                                                         |  | $              | 112,579 |   |                   | $ | 1,037        |                | 3.70 | %              |  | $ | 117,758  |   |              | $ | 4,333  |                | 3.68 | % |          | $ | 108,862      |   |  | $ | 1,111 |  | 4.14 | %
|Loans                                                                                                                                                                                                                                                                                                                                                         |  |                | 149,006 |   |                   |   | 2,458        |                | 6.63 | %              |  |   | 137,826  |   |              |   | 9,720  |                | 7.05 | % |          |   | 135,662      |   |  |   | 2,464 |  | 7.37 | %
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Total earning assets                                                                                                                                                                                                                                                                                                                                          |  | $              | 269,652 |   |                   | $ | 3,517        |                | 5.25 | %              |  | $ | 265,108  |   |              | $ | 14,169 |                | 5.34 | % |          | $ | 254,380      |   |  | $ | 3,607 |  | 5.75 | %
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  
|Taxable equivalent net yield on earning assets                                                                                                                                                                                                                                                                                                                |  |                |         |   |                   | $ | 2,451        |                | 3.66 | %              |  |   |          |   |              | $ | 9,565  |                | 3.61 | % |          |   |              |   |  | $ | 2,403 |  | 3.83 | %
|                                                                                                                                                                                                                                                                                                                                                              |  |                |         |   |                   |   |              |                |      |                |  |   |          |   |              |   |        |                |      |   |          |   |              |   |  |   |       |  |      |  



14



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



Balance Sheet Analysis



Investments



Investment securities decreased $4,387,157 or 3.7% from $119,245,037 at December 31, 2003, to $114,857,880 at March 31, 2004. The decline in investment securities was
primarily used to fund the loan growth during the quarter.



The investment
portfolio is managed to attempt to achieve an optimum mix of asset quality, liquidity and maximum yield on investments. Taxable securities comprised 84.8% of total securities at March 31, 2004, as compared to 84.5% at December 31, 2003. Other than
the normal risks inherent in purchasing U.S. Treasury securities, U.S. Government corporation and agencies securities, and obligations of states and political subdivisions, i.e. interest rate risk, management has no knowledge of other market or
credit risk involved in these investments. The Company does not have any high risk hybrid/derivative instruments.



Investment securities that are classified available for sale are available for sale at any time based upon managements assessment of changes in economic or
financial market conditions. These securities are carried at fair value and the unrealized holding gains and losses, net of taxes, are reflected as a separate component of stockholders equity until realized. Available for sale securities, at
fair value decreased $3,777,832 or 3.3% from December 31, 2003, and represented 97.1% of the investment portfolio at March 31, 2004. The decrease was primarily due to maturities and calls of U.S. Treasury and U.S. Government corporation and agency
securities and corporate debt securities offset in part by the purchase of mortgage-backed securities. The held to maturity securities decreased $609,325 or 15.3% from December 31, 2003 and represented 2.9% of the investment portfolio as of March
31, 2004. The decrease was primarily the result of maturities and calls of municipal securities. As the investment portfolio consists primarily of fixed rate debt securities, changes in the market rates of interest will effect the carrying value of
securities available for sale, adjusted upward or downward under the requirements of FAS 115 and represent temporary adjustments in values. The carrying value of securities available for sale was increased by $1,549,093 and $997,588 at March 31,
2004 and December 31, 2003, respectively. The fair value of securities classified as held to maturity was above book value by $211,751 and $210,275 at March 31, 2004 and December 31, 2003, respectively.



Table Three

Investment Portfolio



The following
table presents the book values of investment securities (in thousands):



|                                                                                      |  |                |         |                   |   |        
|------------------------------------------------------------------------------------- |  | -------------- | ------- | ----------------- | - | -------
|                                                                                      |  | (Unaudited)    |         |                  
|                                                                                      |  | March 31, 2004 |         | December 31, 2003
|                                                                                      | 
|Securities held to maturity:                                                          |  |                |         |                   |   |        
|Obligations of states and political subdivisions                                      |  | $              | 3,366   |                   | $ | 3,976  
|                                                                                      |  |                |         |                   |   |        
|Total held to maturity                                                                |  | $              | 3,366   |                   | $ | 3,976  
|                                                                                      |  |                |         |                   |   |        
|Securities available for sale :                                                       |  |                |         |                   |   |        
|U.S. Treasury securities and obligations of U.S. Government corporations and agencies |  | $              | 52,235  |                   | $ | 56,644 
|Obligations of states and political subdivisions                                      |  |                | 15,479  |                   |   | 15,432 
|Corporate debt securities                                                             |  |                | 2,971   |                   |   | 3,987  
|Mortgage-backed securities                                                            |  |                | 40,151  |                   |   | 38,616 
|Equity Securities                                                                     |  |                | 656     |                   |   | 590    
|                                                                                      |  |                |         |                   |   |        
|Total available for sale                                                              |  |                | 111,492 |                   |   | 115,269
|                                                                                      |  |                |         |                   |   |        
|Total                                                                                 |  | $              | 114,858 |                   | $ | 119,245
|                                                                                      |  |                |         |                   |   |        



15



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



Investments  Continued



Table Four

Investment Portfolio

(dollars in thousands)



The maturity distribution using book value including accretion of discounts and amortization of premiums and approximate yield of investment securities at March 31, 2004
and December 31, 2003 are presented in the following table. Tax equivalent yield basis was used on tax exempt obligations. Approximate yield was calculated using a weighted average of yield to maturities.



|                                |  |                             |       |       |                               |   |        |                             |         |  |                               |        |  |       |       |  |        |   |       |   |         |  |      |  
|------------------------------- |  | --------------------------- | ----- | ----- | ----------------------------- | - | ------ | --------------------------- | ------- |  | ----------------------------- | ------ |  | ----- | ----- |  | ------ | - | ----- | - | ------- |  | ---- | -
|                                |  | (Unaudited)                 |       |       |                               |   |        |                             |         |  |                               |        | 
|                                |  | March 31, 2004              |       |       | December 31, 2003             |  
|                                |  | Securities Held to Maturity |       |       | Securities Available for Sale |   |        | Securities Held to Maturity |         |  | Securities Available for Sale |       
|                                |  | Amount                      |       | Yield |                               |   | Amount |                             | Yield   |  |                               | Amount |  | Yield |       |  | Amount |   | Yield |  
|U.S. Treasury and other U.S.    |  |                             |       |       |                               |   |        |                             |         |  |                               |        |  |       |       |  |        |   |       |   |         |  |      |  
|Government Agencies             |  |                             |       |       |                               |   |        |                             |         |  |                               |        |  |       |       |  |        |   |       |   |         |  |      |  
|Within One Year                 |  | $                           |      |       |                              | % |        | $                           | 4,803   |  | 1.91                          | %      |  | $     |      |  |       | % |       | $ | 3,440   |  | 3.41 | %
|After One But Within Five Years |  |                             |      |       |                              |   |        |                             | 36,758  |  | 2.72                          |        |  |       |      |  |       |   |       |   | 42,111  |  | 2.73 |  
|After Five But Within Ten Years |  |                             |      |       |                              |   |        |                             | 10,316  |  | 3.95                          |        |  |       |      |  |       |   |       |   | 10,731  |  | 4.03 |  
|After Ten Years                 |  |                             |      |       |                              |   |        |                             | 358     |  | 1.62                          |        |  |       |      |  |       |   |       |   | 362     |  | 1.62 |  
|                                |  |                             |       |       |                               |   |        |                             |         |  |                               |        |  |       |       |  |        |   |       |   |         |  |      |  
|                                |  |                             |      |       |                              |   |        |                             | 52,235  |  | 2.88                          |        |  |       |      |  |       |   |       |   | 56,644  |  | 3.01 |  
|                                |  |                             |       |       |                               |   |        |                            
|States & Political Subdivisions |  |                             |       |       |                               |   |        |                             |         |  |                               |        |  |       |       |  |        |   |       |   |         |  |      |  
|Within One Year                 |  |                             | 15    |       | 7.97                          |   |        |                             | 2,240   |  | 3.57                          |        |  |       | 15    |  | 7.97   |   |       |   | 2,152   |  | 3.54 |  
|After One But Within Five Years |  |                             | 3,074 |       | 6.21                          |   |        |                             | 5,533   |  | 4.41                          |        |  |       | 2,857 |  | 6.13   |   |       |   | 6,054   |  | 4.44 |  
|After Five But Within Ten Years |  |                             | 277   |       | 6.37                          |   |        |                             | 7,589   |  | 4.66                          |        |  |       | 1,104 |  | 6.46   |   |       |   | 6,607   |  | 4.93 |  
|After Ten Years                 |  |                             |      |       |                              |   |        |                             | 117     |  | 5.50                          |        |  |       |      |  |       |   |       |   | 619     |  | 3.01 |  
|                                |  |                             |       |       |                               |   |        |                             |         |  |                               |        |  |       |       |  |        |   |       |   |         |  |      |  
|                                |  |                             | 3,366 |       | 6.23                          |   |        |                             | 15,479  |  | 4.42                          |        |  |       | 3,976 |  | 6.23   |   |       |   | 15,432  |  | 4.47 |  
|                                |  |                             |       |       |                               |   |        |                            
|Corporate Debt Securities       |  |                             |       |       |                               |   |        |                             |         |  |                               |        |  |       |       |  |        |   |       |   |         |  |      |  
|Within One Year                 |  |                             |      |       |                              |   |        |                             | 1,364   |  | 5.82                          |        |  |       |      |  |       |   |       |   | 1,000   |  | 2.60 |  
|After One But Within Five Years |  |                             |      |       |                              |   |        |                             | 1,607   |  | 5.91                          |        |  |       |      |  |       |   |       |   | 2,987   |  | 5.85 |  
|                                |  |                             |       |       |                               |   |        |                             |         |  |                               |        |  |       |       |  |        |   |       |   |         |  |      |  
|                                |  |                             |      |       |                              |   |        |                             | 2,971   |  | 5.87                          |        |  |       |      |  |       |   |       |   | 3,987   |  | 5.03 |  
|Mortgage-Backed Securities      |  |                             |      |       |                              |   |        |                             | 40,151  |  | 3.65                          |        |  |       |      |  |       |   |       |   | 38,616  |  | 3.91 |  
|Equity Securities               |  |                             |      |       |                              |   |        |                             | 656     |  | 2.26                          |        |  |       |      |  |       |   |       |   | 590     |  | 2.02 |  
|                                |  |                             |       |       |                               |   |        |                             |         |  |                               |        |  |       |       |  |        |   |       |   |         |  |      |  
|Total                           |  | $                           | 3,366 |       | 6.23                          | % |        | $                           | 111,492 |  | 3.45                          | %      |  | $     | 3,976 |  | 6.23   | % |       | $ | 115,269 |  | 3.57 | %
|                                |  |                             |       |       |                               |   |        |                             |         |  |                               |        |  |       |       |  |        |   |       |   |         |  |      |  



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



Loans



Loans represent the largest asset on the Companys balance sheet. Total loans, net of unearned income, increased $4,439,508 or 3.0% from $146,710,494 at December 31,
2003 to $151,150,002 at March 31, 2004. The growth in the loan portfolio in the first quarter of 2004 was primarily due to an increase in commercial loans.



Real estate residential loans which include real estate construction, real estate farmland, and real estate residential loans comprised thirty-five percent (35%) of the
loan portfolio. Commercial loans which include real estate secured by non-farm, non-residential and commercial and industrial loans comprised forty-four percent (44%) of the loan portfolio. Installment loans comprised thirteen percent (13%) of the
loan portfolio. Other loans which include non-rated industrial development obligations, direct financing leases and other loans comprised eight percent (8%) of the loan portfolio. The changes in the composition of the loan portfolio since December
31, 2003 were a 1% increase in commercial loans, and a 1% decrease in real estate residential loans.



Table Five - Loan Portfolio

Loans outstanding are as follows (in thousands):



|                                               |  |                |         |                   |   |        
|---------------------------------------------- |  | -------------- | ------- | ----------------- | - | -------
|                                               |  | (Unaudited)    |         |                  
|                                               |  | March 31, 2004 |         | December 31, 2003
|                                               | 
|Real Estate-Residential                        |  |                |         |                   |   |        
|Real estate-construction                       |  | $              | 2,053   |                   | $ | 1,932  
|Real estate-farmland                           |  |                | 311     |                   |   | 315    
|Real estate-residential                        |  |                | 50,712  |                   |   | 50,732 
|                                               |  |                |         |                   |   |        
|                                               |  | $              | 53,076  |                   | $ | 52,979 
|                                               |  |                |         |                   |   |        
|Commercial                                     |  |                |         |                   |   |        
|Real estate-secured by nonfarm, nonresidential |  | $              | 48,252  |                   | $ | 44,692 
|Commercial & industrial                        |  |                | 18,485  |                   |   | 18,460 
|                                               |  |                |         |                   |   |        
|                                               |  | $              | 66,737  |                   | $ | 63,152 
|                                               |  |                |         |                   |   |        
|Installment                                    |  |                |         |                   |   |        
|Installment and other loans to individuals     |  | $              | 18,768  |                   | $ | 18,887 
|                                               |  |                |         |                   |   |        
|Others                                         |  |                |         |                   |   |        
|Nonrated industrial development obligations    |  | $              | 12,597  |                   | $ | 11,847 
|Other loans                                    |  |                | 160     |                   |   | 22     
|                                               |  |                |         |                   |   |        
|                                               |  | $              | 12,757  |                   | $ | 11,869 
|                                               |  |                |         |                   |   |        
|Total                                          |  |                | 151,338 |                   |   | 146,887
|Less unearned interest                         |  |                | 188     |                   |   | 176    
|                                               |  |                |         |                   |   |        
|                                               |  | $              | 151,150 |                   | $ | 146,711
|                                               |  |                |         |                   |   |        



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



Table Six

Loan Portfolio - Maturities and sensitivities of Loans to Changes in Interest Rates

(dollars in thousands)



The following table presents the contractual maturities of loans other than
installment loans and residential mortgages as of March 31, 2004 and December 31, 2003:



|                                                                     |  |                     |       |                                   |   |                  |  |                     |        |                                   |   |                  |  |   |        |  |   |       
|-------------------------------------------------------------------- |  | ------------------- | ----- | --------------------------------- | - | ---------------- |  | ------------------- | ------ | --------------------------------- | - | ---------------- |  | - | ------ |  | - | ------
|                                                                     |  | (Unaudited)         |       |                                  
|                                                                     |  | March 31, 2004      |       | December 31, 2003                
|                                                                     |  | In one Year or Less |       | After one Year Through Five Years |   | After Five Years |  | In one Year or Less |        | After one Year Through Five Years |   | After Five Years
|                                                                     |  |                     |       |                                   |  
|                                                                     |  |                     |       |                                   |  
|Real estate construction                                             |  | $                   | 728   |                                   | $ | 1,187            |  | $                   | 138    |                                   | $ | 640              |  | $ | 1,172  |  | $ | 120   
|Commercial real estate - secured by nonfarm, nonresidential property |  |                     | 506   |                                   |   | 2,744            |  |                     | 45,002 |                                   |   | 974              |  |   | 2,543  |  |   | 41,175
|Commercial and industrial                                            |  |                     | 1,798 |                                   |   | 8,181            |  |                     | 8,506  |                                   |   | 1,691            |  |   | 8,206  |  |   | 8,563 
|Nonrated industrial development obligations                          |  |                     | 1,644 |                                   |   | 2,905            |  |                     | 8,048  |                                   |   | 1,474            |  |   | 2,877  |  |   | 7,496 
|                                                                     |  |                     |       |                                   |   |                  |  |                     |        |                                   |   |                  |  |   |        |  |   |       
|Total                                                                |  | $                   | 4,676 |                                   | $ | 15,017           |  | $                   | 61,694 |                                   | $ | 4,779            |  | $ | 14,798 |  | $ | 57,354
|                                                                     |  |                     |       |                                   |   |                  |  |                     |        |                                   |   |                  |  |   |        |  |   |       



The following table presents an
analysis of fixed and variable rate loans as of March 31, 2004 and December 31, 2003 along with the contractual maturities of loans other than installment loans and residential mortgages:



|               |  |                     |       |                                   |   |                  |  |                     |        |                                   |   |                  |  |   |        |  |   |       
|-------------- |  | ------------------- | ----- | --------------------------------- | - | ---------------- |  | ------------------- | ------ | --------------------------------- | - | ---------------- |  | - | ------ |  | - | ------
|               |  | (Unaudited)         |       |                                   |   |                  |  |                    
|               |  | March 31, 2004      |       | December 31, 2003                
|               |  | In one Year or Less |       | After one Year Through Five Years |   | After Five Years |  | In one Year or Less |        | After one Year Through Five Years |   | After Five Years
|               |  |                     |       |                                   |  
|               |  |                     |       |                                   |  
|Fixed Rates    |  | $                   | 3,802 |                                   | $ | 8,250            |  | $                   | 13,145 |                                   | $ | 3,449            |  | $ | 8,057  |  | $ | 12,435
|Variable Rates |  |                     | 874   |                                   |   | 6,767            |  |                     | 48,549 |                                   |   | 1,330            |  |   | 6,741  |  |   | 44,919
|               |  |                     |       |                                   |   |                  |  |                     |        |                                   |   |                  |  |   |        |  |   |       
|Total          |  | $                   | 4,676 |                                   | $ | 15,017           |  | $                   | 61,694 |                                   | $ | 4,779            |  | $ | 14,798 |  | $ | 57,354
|               |  |                     |       |                                   |   |                  |  |                     |        |                                   |   |                  |  |   |        |  |   |       



Non-performing assets include
non-accrual loans on which the collectibility of the full amount of interest is uncertain; loans which have been renegotiated to provide for a reduction or deferral of interest on principal because of a deterioration in the financial position of the
borrower; loans past due ninety days or more as to principal or interest; and other real estate owned. A summary of nonperforming assets is presented in Table Seven.



Total non-performing loans were $2,140,000 at March 31, 2004 as compared to $2,169,000 at December 31, 2003. The decline in loans past due
90 days or more primarily contributed to the decrease in non-performing loans. Loans past due 90 days or more and still accruing interest were $24,000 at March 31, 2004, as compared to $58,000 at December 31, 2003.



Loans are placed in non-accrual when the principal or interest is past due 90 days or more,
unless the loan is both well secured and in the process of collection. Non-accrual loans were at 1.4% of total loans outstanding as of March 31, 2004, as compared to 1.4% of total loans at December 31, 2003. Management continues to monitor the
nonperforming assets to ensure against deterioration in collateral values.



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



Loans  Continued



Table Seven

Risk Elements

(dollars in thousands)



Loans which are in the process of collection, but are contractually past due 90 days or more as to interest or principal, renegotiated, non-accrual loans and other real
estate are as follows:



|                                                                 |  |             |       |   |                   |   |       |   |  |   |       |  
|---------------------------------------------------------------- |  | ----------- | ----- | - | ----------------- | - | ----- | - |  | - | ----- | -
|                                                                 |  | (Unaudited) |       |   |                   |  
|                                                                 |  | March 31,   |       |   | December 31, 2003 |  
|                                                                 |  | 2004        |       |   | 2003              |   |      
|Past Due 90 Days or More:                                        |  |             |       |   |                   |   |       |   |  |   |       |  
|Real Estate - residential                                        |  | $           |      |   |                   | $ |      |   |  | $ | 52    |  
|Commercial                                                       |  |             | 15    |   |                   |   |      |   |  |   |      |  
|Installment                                                      |  |             | 9     |   |                   |   | 30    |   |  |   | 6     |  
|                                                                 |  |             |       |   |                   |   |       |   |  |   |       |  
|                                                                 |  | $           | 24    |   |                   | $ | 30    |   |  | $ | 58    |  
|                                                                 |  |             |       |   |                   |   |       |   |  |   |       |  
|Non-accrual:                                                     |  |             |       |   |                   |   |       |   |  |   |       |  
|Real Estate - residential                                        |  | $           | 78    |   |                   | $ |      |   |  | $ | 12    |  
|Commercial                                                       |  |             | 2,025 |   |                   |   | 1,445 |   |  |   | 2,052 |  
|Installment                                                      |  |             | 1     |   |                   |   | 27    |   |  |   | 35    |  
|                                                                 |  |             |       |   |                   |   |       |   |  |   |       |  
|                                                                 |  | $           | 2,104 |   |                   | $ | 1,472 |   |  | $ | 2,099 |  
|                                                                 |  |             |       |   |                   |   |       |   |  |   |       |  
|Other Real Estate                                                |  | $           | 12    |   |                   | $ | 102   |   |  | $ | 12    |  
|                                                                 |  |             |       |   |                   |   |       |   |  |   |       |  
|Total non-performing assets                                      |  | $           | 2,140 |   |                   | $ | 1,604 |   |  | $ | 2,169 |  
|                                                                 |  |             |       |   |                   |   |       |   |  |   |       |  
|Total non-performing assets to total loans and other real estate |  |             | 1.42  | % |                   |   | 1.19  | % |  |   | 1.48  | %



Generally, all banks recognize
interest income on the accrual basis, except for certain loans which are placed on a non-accrual status. Loans are placed on a non-accrual status, when in the opinion of management doubt exists as to its collectibility. In accordance with the Office
of the Comptroller of the Currency Policy, banks may not accrue interest on any loan which either the principal or interest is past due 90 days or more unless the loan is both well secured and in the process of collection.



The amount of interest income that would have been recognized had the loans performed in
accordance with their original terms was approximately $47,000, $31,400 and $173,500 for the periods ended March 31, 2004, March 31, 2003 and December 31, 2003, respectively.



As of March 31, 2004, there are no loans known to management other than those previously disclosed about which management has any
information about possible credit problems of borrowers which causes management to have serious doubts as to the borrowers ability to comply with present loan repayment terms.



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



Table Eight

Analysis of Allowance for Possible Loan Losses

(dollars in thousands)



The following table presents a summary of loans charged off and recoveries of loans previously charged off by type of loan.



|                                                                           |  |             |         |   |                   |   |         |   |  |   |         |  
|-------------------------------------------------------------------------- |  | ----------- | ------- | - | ----------------- | - | ------- | - |  | - | ------- | -
|                                                                           |  | (Unaudited) |         |   |                   |  
|                                                                           |  | March 31,   |         |   | December 31, 2003 |  
|                                                                           |  | 2004        |         |   | 2003              |   |        
|Allowance for loan losses:                                                 |  |             |         |   |                   |   |         |   |  |   |         |  
|Balance at beginning of period:                                            |  | $           | 2,305   |   |                   | $ | 2,027   |   |  | $ | 2,027   |  
|                                                                           |  |             |        
|Loans Charged Off:                                                         |  |             |         |   |                   |   |         |   |  |   |         |  
|Real Estate - residential                                                  |  |             |        |   |                   |   | 13      |   |  |   | 13      |  
|Commercial                                                                 |  |             | 140     |   |                   |   |        |   |  |   | 77      |  
|Installment                                                                |  |             | 29      |   |                   |   | 6       |   |  |   | 76      |  
|                                                                           |  |             |         |   |                   |   |         |   |  |   |         |  
|                                                                           |  |             | 169     |   |                   |   | 19      |   |  |   | 166     |  
|                                                                           |  |             |        
|Recoveries:                                                                |  |             |         |   |                   |   |         |   |  |   |         |  
|Real Estate - residential                                                  |  |             | 17      |   |                   |   | 3       |   |  |   | 3       |  
|Commercial                                                                 |  |             |        |   |                   |   |        |   |  |   |        |  
|Installment                                                                |  |             | 5       |   |                   |   | 2       |   |  |   | 6       |  
|                                                                           |  |             |         |   |                   |   |         |   |  |   |         |  
|                                                                           |  |             | 22      |   |                   |   | 5       |   |  |   | 9       |  
|                                                                           |  |             |        
|Net Charge-offs                                                            |  |             | 147     |   |                   |   | 14      |   |  |   | 157     |  
|                                                                           |  |             |        
|Additions Charged to Operations                                            |  |             | 30      |   |                   |   | 90      |   |  |   | 435     |  
|                                                                           |  |             |         |   |                   |   |         |   |  |   |         |  
|Balance at end of period:                                                  |  | $           | 2,188   |   |                   | $ | 2,103   |   |  | $ | 2,305   |  
|                                                                           |  |             |         |   |                   |   |         |   |  |   |         |  
|Average Loans Outstanding                                                  |  | $           | 149,006 |   |                   | $ | 133,662 |   |  | $ | 137,826 |  
|                                                                           |  |             |         |   |                   |   |         |   |  |   |         |  
|Ratio of net charge-offs to Average loans outstanding for the period       |  |             | 0.10    | % |                   |   | 0.01    | % |  |   | 0.11    | %
|                                                                           |  |             |        
|Ratio of the Allowance for Loan Losses to Loans Outstanding for the period |  |             | 1.45    | % |                   |   | 1.56    | % |  |   | 1.57    | %



The additions to the allowance for
loan losses are based on managements evaluation of characteristics of the loan portfolio, current and anticipated economic conditions, past loan experiences, net loans charged-off, specific problem loans and delinquencies, and other factors.



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



Allowance for Loan Losses



In all lending activities there is an inherent risk that borrowers will be unable to repay their obligations. The Company maintains an
allowance for loan losses to absorb probable loan losses. Table Eight presents a summary of the Allowance for Loan Losses.



The Company has historically maintained the allowance for loan losses at a level greater than actual charge-offs. Although a subjective evaluation is determined by
management, the Company believes it has appropriately assessed the risk of loans in the loan portfolio and has provided for an allowance which is adequate based on that assessment. Because the allowance is an estimate, any change in the economic
conditions of the Companys market area could result in new estimates which could affect the Companys earnings. Management monitors the quality of the loan portfolio through reviews of past due loans and all significant loans which are
considered to be potential problem loans on a monthly basis. The internal loan review function provides for an independent review of commercial, real estate, and installment loans in order to measure the asset quality of the portfolio.
Managements review of the loan portfolio has not indicated any material loans, not disclosed in the accompanying tables and discussions which are known to have possible credit problems that cause management to have serious doubts as to the
ability of each borrower to comply with their present loan repayment terms.



The allowance for loan losses decreased $116,653 or 5.1%, since December 31, 2003. The allowance for loan losses represented 1.5% and 1.6% of outstanding loans as of March 31, 2004 and December 31, 2003, respectively. Net loan charge-offs
were $146,654 in 2004, compared to $159,067 in 2003. The net loan charge-offs during the first quarter of 2004 were primarily commercial and consumer loans. The provision for possible loan losses was $30,000 for the three month period ended March
31, 2004, compared to $90,000 at March 31, 2003. The credit quality of the loan portfolio combined with the recent level of net charge-offs and nonperforming assets continue to be considered in the calculation of the provision for loan losses.



The Company has allocated the allowance for possible loan losses to specific
portfolio segments based upon historical net charge-off experience, changes in the level of nonperforming assets, local economic conditions and managements experience as presented in Table Nine.



Table Nine

Loan Portfolio - Allocation of allowance for possible loan losses

(dollars in thousands)



The following table presents an allocation of the allowance for possible loan losses at each
of the four year periods ended December 31, 2003, and the three month period ended March 31, 2004. The allocation presented below is based on the historical average of net charge offs per category combined with the change in loan growth and
managements review of the loan portfolio.



|                         |  |           |       |                                                 |              |   |        |      |                                                 |  |       |        |  |                                                 |       |  |        |   |                                                 |   |       |        |       |                                                 |  |   |       |  |       |  
|------------------------ |  | --------- | ----- | ----------------------------------------------- | ------------ | - | ------ | ---- | ----------------------------------------------- |  | ----- | ------ |  | ----------------------------------------------- | ----- |  | ------ | - | ----------------------------------------------- | - | ----- | ------ | ----- | ----------------------------------------------- |  | - | ----- |  | ----- | -
|                         |  | March 31, |       |                                                 | December 31, |  
|                         |  | 2004      |       |                                                 | 2003         |   |        | 2002 |                                                 |  | 2001  |        |  | 2000                                            |      
|                         |  | Amount    |       | Percent of loans in eachcategory to total loans |              |   | Amount |      | Percent of loans in eachcategory to total loans |  |       | Amount |  | Percent of loans in eachcategory to total loans |       |  | Amount |   | Percent of loans in eachcategory to total loans |   |       | Amount |       | Percent of loans in eachcategory to total loans | 
|Real estate -residential |  | $         | 328   |                                                 | 35.1         | % |        | $    | 311                                             |  | 36.0  | %      |  | $                                               | 276   |  | 37.5   | % |                                                 | $ | 263   |        | 37.3  | %                                               |  | $ | 241   |  | 37.9  | %
|Commercial               |  |           | 1,319 |                                                 | 44.1         |   |        |      | 1,429                                           |  | 43.0  |        |  |                                                 | 1,161 |  | 41.7   |   |                                                 |   | 821   |        | 40.0  |                                                 |  |   | 549   |  | 37.0  |  
|Installment              |  |           | 520   |                                                 | 12.4         |   |        |      | 544                                             |  | 12.9  |        |  |                                                 | 569   |  | 12.9   |   |                                                 |   | 541   |        | 16.1  |                                                 |  |   | 492   |  | 20.9  |  
|Others                   |  |           | 21    |                                                 | 8.4          |   |        |      | 21                                              |  | 8.1   |        |  |                                                 | 21    |  | 7.9    |   |                                                 |   | 21    |        | 6.6   |                                                 |  |   | 20    |  | 4.2   |  
|                         |  |           |       |                                                 |              |   |        |      |                                                 |  |       |        |  |                                                 |       |  |        |   |                                                 |   |       |        |       |                                                 |  |   |       |  |       |  
|Total                    |  | $         | 2,188 |                                                 | 100.0        | % |        | $    | 2,305                                           |  | 100.0 | %      |  | $                                               | 2,027 |  | 100.0  | % |                                                 | $ | 1,646 |        | 100.0 | %                                               |  | $ | 1,302 |  | 100.0 | %
|                         |  |           |       |                                                 |              |   |        |      |                                                 |  |       |        |  |                                                 |       |  |        |   |                                                 |   |       |        |       |                                                 |  |   |       |  |       |  



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



Deposits



A stable core deposit base is the major source of funds for the Holding Companys subsidiary bank. The deposit mix depends upon many factors including competition
from other financial institutions, depositor interest in certain types of deposits, changes in the interest rate and the Companys need for certain types of deposit growth. Total deposits were $240,394,947 at March 31, 2004 as compared to
$241,947,330 at December 31, 2003, a decrease of .6%. During the first quarter of 2004, the decline in deposits was primarily in noninterest bearing demand deposits, time deposits and savings deposits, offset in part by an increase in interest
bearing demand deposits. During the first quarter of 2004, noninterest bearing deposits decreased $1,234,532 or 5.2% and interest bearing deposits decreased $317,851 or .2%. At March 31, 2004, noninterest bearing deposits comprised 9% of total
deposits and interest bearing deposits which include NOW, money market, savings and time deposits comprised 91% of total deposits. The change in the deposit mix from December 31, 2003 to March 31, 2004 was a 1% decrease in noninterest bearing
deposits and a 1% increase in interest bearing deposits.



Table Ten



The following table presents other time deposits of $100,000 or more
issued by domestic offices by time remaining until maturity of 3 months or less; over 3 through 6 months; over 6 through 12 months; and over 12 months. (Unaudited)



|                             |  |                                                   |       |                                     |   |                                      |  |                    |       |       |   |       |  |   |       
|---------------------------- |  | ------------------------------------------------- | ----- | ----------------------------------- | - | ------------------------------------ |  | ------------------ | ----- | ----- | - | ----- |  | - | ------
|                             |  | March 31, 2004                                    |       |                                     |   |                                     
|                             |  | Maturities of Time Deposits in Excess of $100,000 |       |                                     |   |                                     
|                             |  | In Three Months Or Less                           |       | Over Three And Less Than Six Months |   | Over Six And Less Than Twelve Months |  | Over Twelve Months |       | TOTAL
|                             |  |                                                   |       |                                    
|                             |  |                                                   |       |                                    
|                             |  | (Expressed in Thousands)                         
|Time Certificates of Deposit |  | $                                                 | 8,349 |                                     | $ | 968                                  |  | $                  | 4,224 |       | $ | 9,693 |  | $ | 23,234
|                             |  |                                                   |      
|                             |  | December 31, 2003                                 |       |                                     |   |                                     
|                             |  | Maturities of Time Deposits in Excess of $100,000 |       |                                     |   |                                     
|                             |  | In Three Months Or Less                           |       | Over Three And Less Than Six Months |   | Over Six And Less Than Twelve Months |  | Over Twelve Months |       | TOTAL
|                             |  |                                                   |       |                                    
|                             |  |                                                   |       |                                    
|                             |  | (Expressed in Thousands)                         
|Time Certificates of Deposit |  | $                                                 | 3,327 |                                     | $ | 8,283                                |  | $                  | 3,819 |       | $ | 9,047 |  | $ | 24,476



Federal Funds Purchased and
Repurchase Agreements



Federal funds purchased and repurchase agreements
are short-term borrowings. There were no Federal funds purchased at March 31, 2004. Federal funds purchased were $800,000 as of December 31, 2003. The subsidiary bank has an accommodation agreement with a commercial bank to borrow a maximum
aggregate amount of $4 million which expires in June 2004. Repurchase agreements decreased $743,145 or 5.2%, from $14,288,834 at December 31, 2003 to $13,545,689 at March 31, 2004. The decrease in repurchase agreements was primarily due to decreases
in balances maintained by existing customers.



Federal Home Loan Bank
Borrowings



Federal Home Loan Bank (FHLB) borrowings were
$2,454,046 at March 31, 2004 compared to $2,463,464 at December 31, 2003 with an interest rate of 4.76%. The FHLB borrowings are collateralized by a blanket collateral agreement which assigns a security interest in capital stock, deposits, mortgage
loans, securities and FHLB stock of the subsidiary bank. The borrowings will mature in 2018. The FHLB funding was utilized to mitigate the impact of rising interest rates for a long term fixed rate loan commitment.



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##### Table of Contents

First West Virginia Bancorp, Inc.

Managements Discussion and Analysis of the Financial Condition and

Results of Holding Company Operations



Other Assets and Other Liabilities



Changes in other assets and liabilities were the primarily the result of trade date accounting on investment securities purchases and sales.
At December 31, 2003, other assets were increased by approximately $3.7 million due to sales of investment securities. At March 31, 2004, other liabilities were increased by approximately $2.9 million due to purchases of investment securities.



Capital Resources



A strong capital base is vital to continued profitability because it promotes depositor and
investor confidence and provides a solid foundation for future growth. Stockholders equity increased 1.6% during the first three months of 2004 entirely from current earnings after quarterly dividends, and increased 1.5% resulting from the
effect of the change in the net unrealized gain on securities available for sale. Stockholders equity amounted to 8.3% of total assets at March 31, 2004 as compared to 8.1% at December 31, 2003.



The Holding Companys primary source of funds for payment of dividends to shareholders
is from the dividends from its subsidiary banks. Earnings from subsidiary bank operations are expected to remain adequate to fund payment of stockholders dividends and internal growth. In managements opinion, the subsidiary bank has the
capability to upstream sufficient dividends to meet the cash requirements of the Holding Company.



The Holding Company is subject to regulatory risk-based capital guidelines administered by the Federal Reserve Board. These risk-based capital guidelines establish minimum capital ratios of Total capital, Tier 1
Capital, and Leverage to assess the capital adequacy of bank holding companies.



The following chart shows the regulatory capital levels for the company at March 31, 2004, and December 31, 2003:



|                   |  |         |   |  |                |   |  |              |  
|------------------ |  | ------- | - |  | -------------- | - |  | ------------ | -
|Ratio              |  | Minimum |   |  | March 31, 2004 |   |  | Dec. 31 2003 |  
|                   |  |        
|Leverage Ratio     |  | 3       | % |  | 7.2            | % |  | 6.9          | %
|Risk Based Capital |  |         |   |  |                |   |  |              |  
|Tier 1 (core)      |  | 4       | % |  | 11.5           | % |  | 11.3         | %
|Tier 2 (total)     |  | 8       | % |  | 12.8           | % |  | 12.5         | %



Liquidity



Liquidity management ensures that funds are available to meet loan commitments, deposit
withdrawals, and operating expenses. Funds are provided by loan repayments, investment securities maturities, or deposits, and can be raised by liquidating assets or through additional borrowings. The Holding Company had investment securities with
an estimated fair value of $111,491,520 classified as available for sale at March 31, 2004. These securities are available for sale at any time based upon managements assessment in order to provide necessary liquidity should the need arise. In
addition, the Holding Companys subsidiary bank, Progressive Bank, N.A., is a member of the Federal Home Loan Bank of Pittsburgh (FHLB). Membership in the FHLB provides an additional source of funding, in the form of collateralized
advances. At March 31, 2004, the subsidiary bank had a short term line of credit available with the FHLB in the aggregate amount of approximately $7 million. There was no short term borrowings outstanding pursuant to this agreement as of March 31,
2004.



At March 31, 2004 and December 31, 2003, the Holding Company had
outstanding loan commitments and unused lines of credit totaling $29,478,000 and $28,034,000, respectively. As of March 31, 2004, management placed a high probability for required funding within one year of approximately $24.8 million. Approximately
$4.2 million is principally unused home equity and credit card lines on which management places a low probability for required funding.



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##### Table of Contents

FIRST WEST VIRGINIA BANCORP, INC.

PART I



Item 3 Quantitative and Qualitative Disclosures About Market Risk



The Companys subsidiary bank uses an asset/liability model to measure the impact of changes in interest rates on net interest income on a periodic basis. Assumptions are made to simulate the impact of future
changes in interest rates and/or changes in balance sheet composition. The effect of changes in future interest rates on the mix of assets and liabilities may cause actual results to differ from simulated results. Guidelines established by the
Companys subsidiary bank provides that the estimated net interest income may not change by more than 10% in a one year period given a +/- 200 basis point parallel shift in interest rates. Excluding the potential effect of interest rate changes
on assets and liabilities of the Holding Company which are not deemed material, the anticipated impact on net interest income of the subsidiary bank at March 31, 2004 was as follows: given a 200 basis point increase scenario net interest income
would be reduced by approximately 5.1%, and given a 200 basis point decrease scenario net interest income would be reduced by approximately 13.4%. The Asset Liability committee believes that a 200 basis point decline in interest rates is unlikely to
occur, and have determined that a 100 basis point instantaneous change may be more realistic. Therefore, the results using a +/-100 basis point interest rate scenario are presented. Under the 100 basis point increase scenario net interest income
would be reduced by approximately 2.0%, and given a 100 basis point decrease scenario net interest income would be reduced by 5.3%. The projections provided by the model are not intended as an actual forecast of the banks performance in a
particular rate environment, and should not be relied upon. Actual changes in the interest rate environment normally do not take place instantaneously, but over a period of time, and do not occur in a parallel fashion. Additionally, the balance
sheet composition, spread relationships for new dollars invested, non interest income and expenses, investment practices, and deposit practices all change as a result of changes in interest rates and would need to be considered by the Asset
Liability committee.



Item 4 Controls and Procedures



Evaluation of Disclosure Controls and Procedures



The
Companys President and Chief Executive Officer, Charles K. Graham, and Senior Vice President and Chief Financial Officer, Francie P. Reppy, after evaluating the effectiveness of the Companys disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) as of a date within 90 days prior to the filing of this report (the Evaluation Date), have concluded that, as of the Evaluation Date, the Companys disclosure controls and procedures were
adequate and effective to ensure that material information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in
Securities and Exchange Commission rules and forms.



Changes in Internal
Controls



There were no significant changes in the Companys
internal controls or in other factors that could significantly affect the Companys disclosure controls and procedures subsequent to the date of their evaluation, nor were there any significant deficiencies or material weaknesses in the
Companys internal controls. As a result, no corrective actions were required or undertaken.



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##### Table of Contents

FIRST WEST VIRGINIA BANCORP, INC.



PART II

OTHER INFORMATION



Item 1 Legal Proceedings



The nature of the business of the Holding Companys subsidiaries generates a certain amount of litigation involving matters arising in the ordinary course of business. The Company is unaware of any litigation other than ordinary
routine litigation incidental to the business of the Company, to which it or any of its subsidiaries is a party or of which any of their property is subject.



Item 2 Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities



Inapplicable



Item 3 Defaults Upon Senior Securities



Inapplicable



Item 4 Submission of Matters to Vote of Security Holders



Inapplicable



Item 5 Other Information



Item 6 Exhibits and Reports on Form 8K



(a) Reports on Form 8K



On
March 26, 2004 a report on Form 8 - K was filed which contained a press release dated March 25, 2004 that reported the earnings of First West Virginia Bancorp, Inc. for the fourth quarter and year ended December 31, 2003.



(b) Exhibits



The exhibits listed in the Exhibit Index on page 27 of this FORM 10-Q are incorporated by reference and/or filed herewith.



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##### Table of Contents

SIGNATURES



Pursuant to the requirements of
Section 13 or 15(d) 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.



|    |  |                                                  
|--- |  | -------------------------------------------------
|    |  | First West Virginia Bancorp, Inc                 
|    |  | (Registrant)                                     
|    | 
|By: |  | /s/ Charles K. Graham                            
|    |  | Charles K. Graham                                
|    |  | President and Chief Executive Officer/Director   
|    | 
|By: |  | /s/ Francie P. Reppy                             
|    |  | Francie P. Reppy                                 
|    |  | Senior Vice President and Chief Financial Officer



Dated: May 12, 2004



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##### Table of Contents

EXHIBIT INDEX



The following
exhibits are filed herewith and/or are incorporated herein by reference.



|               |  |                                                                                                                                                                                                              
|-------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit Number |  | Description                                                                                                                                                                                                  
|               | 
|3.1            |  | Certificate and Articles of Incorporation of First West Virginia Bancorp, Inc. Incorporated herein by reference.                                                                                             
|               | 
|3.2            |  | Bylaws of First West Virginia Bancorp, Inc. Incorporated herein by reference.                                                                                                                                
|               | 
|10.1           |  | Employment Contract dated December 23, 2002 between First West Virginia Bancorp, Inc. and Charles K. Graham. Incorporated herein by reference.                                                               
|               | 
|10.3           |  | Lease dated July 20, 1993 between Progressive Bank, N.A., formerly known as First West Virginia Bank, N.A., and Angela I. Stauver. Incorporated herein by
reference.                                       
|               | 
|10.4           |  | Banking Services License Agreement dated October 26, 1994 between Progressive Bank, N.A., formerly known as First West Virginia Bank, N.A., and The Kroger Co. Incorporated herein
by reference.           
|               | 
|10.5           |  | Lease dated November 14, 1995 between Progressive Bank, N.A.  Buckhannon and First West Virginia Bancorp, Inc. and O. V. Smith & Sons of Big Chimney, Inc. Incorporated herein by
reference.                
|               | 
|10.6           |  | Lease dated May 20, 1998 between Progressive Bank, N.A. and Robert Scott Lumber Company. Incorporated herein by reference.                                                                                   
|               | 
|10.7           |  | Lease dated May 12, 2001 between Progressive Bank, N.A. and Sylvan J. Dlesk and Rosalie J. Dlesk doing business as Dlesk Realty & Investment Company. Incorporated herein by
reference.                      
|               | 
|11.1           |  | Statement regarding computation of per share earnings. Filed herewith and incorporated herein by reference.                                                                                                  
|               | 
|13.3           |  | Summarized Quarterly Financial Information. Filed herewith and incorporated herein by reference.                                                                                                             
|               | 
|15             |  | Letter re unaudited interim financial information. Incorporated herein by reference. See Part 1, Notes to Consolidated Financial Statements                                                                  
|               | 
|31             |  | Rule 13a-14(a) / 15d/14(a) Certifications  Certification of Chief Executive Officer pursuant to section 302 of the Securities and Exchange Act of 1934. Filed herewith and incorporated
herein by reference.
|               | 
|31.1           |  | Rule 13a-14(a) / 15d/14(a) Certifications  Certification of Chief Financial Officer pursuant to section 302 of the Securities and Exchange Act of 1934. Filed herewith and incorporated
herein by reference.
|               | 
|32             |  | Certification pursuant to 18 U.S.C. §1350,as adopted pursuant to section 906 of the SARBANES-OXLEY ACT of 2002. Filed herewith and incorporated herein by reference.                                         
|               | 
|99.1           |  | Independent Accountants Report. Filed herewith and incorporated herein by reference.                                                                                                                        



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