<PAGE>
 
         CAMERON FINANCIAL CORPORATION ANNUAL REPORT TO STOCKHOLDERS. 
                                                                    EXHIBIT 13

                               TABLE OF CONTENTS
                               -----------------

<TABLE>
<CAPTION>
 
 
                                                                    Page
                                                                    ----
<S>                                                                  <C>  
President's Message..............................................     1
 
General Information..............................................     2
 
Selected Consolidated Financial and Other Data of the Company....     3
 
Management's Discussion and Analysis of Financial Condition
  and Results of Operations......................................     5
 
Consolidated Financial Statements................................    19
 
Stockholder Information..........................................    43
 
Corporate Information............................................    44
</TABLE>



CFC         CAMERON FINANCIAL CORPORATION
            Holding Company for The Cameron Savings & Loan Association, F.A. 
----------------------------------------------------------------------------
December 30, 1996
<PAGE>
 
To Our Stockholders:

The Board of Directors, management and staff of Cameron Financial Corporation
and its wholly-owned subsidiary, The Cameron Savings & Loan Association, F.A.,
are pleased to present our second Annual Report.

The fiscal year ended September 30, 1996, our first full year as a public
company, was one of solid performance.  Although net earnings for the year were
$2.1 million, down from $2.3 million for fiscal 1995, the Association expensed
$800,000 as a special assessment to recapitalize the Savings Association
Insurance Fund (SAIF).  The result of the special assessment will be lower SAIF
premiums in the future.  Loans receivable net increased by $24.7 million, with
increases in residential, construction and consumer loans.  Cameron Financial
will continue to focus on planned and controlled growth, emphasizing mortgage
and consumer lending and developing new products and services for our customers.

Construction of our new home office in Cameron is schedule for completion in
March 1997.  The new facility will provide the additional space needed for the
customer services and growth planned by your Board of Directors and management.
Land has been contracted for purchase in Liberty, Missouri for the construction
of a new building and the conversion of the loan origination office to a full
service branch.

Your Board and management remain committed to building strong stockholder value.
We continue to be a financial institution that emphasizes family financial
relationships, and we are committed to our customers and to the communities we
serve.

Thank you for your investment in Cameron Financial Corporation.  We are looking
forward to a long and prosperous relationship.

Sincerely,

/s/ David G. Just

David G. Just
President


--------------------------------------------------------------------------------
                              123 East 3rd Street
[LOGO OF RECYCLED PAPER           P.O. Box 555                  [LOGO OF BOY INK
 APEARS HERE]                  CAMERON, MO 64429                 APPEARS HERE]
                                (816)632-2154
<PAGE>
 
                              GENERAL INFORMATION
                              -------------------



Cameron Financial Corporation (the "Company") is a Delaware Corporation which is
the holding company for The Cameron Savings & Loan Association, F.A. (the
"Association").  The Company was organized by the Association for the purpose of
acquiring all of the capital stock of the Association in connection with the
conversion of the Association from mutual to stock form, which was completed on
March 31, 1995 (the "Conversion").  The only significant assets of the Company
are the capital stock of the Association, the Company's loan to an employee
stock ownership plan, and investment securities in United States government and
agency obligations.  The business of the Company initially consists of the
business of the Association.

The Association, which was originally chartered in 1887 as a Missouri-chartered
mutual savings and loan association, is headquartered in Cameron, Missouri. The
Association amended its mutual charter to become a federal mutual savings and
loan association in 1994.  Its deposits are insured up to the maximum allowable
amount by the Federal Deposit Insurance Corporation (FDIC).  The Association
serves the financial needs of its customers throughout northwestern Missouri
through its main office located at 123 East Third Street, Cameron, Missouri, two
branch offices located in Maryville and Mound City, Missouri, and one loan
production office located in Liberty, Missouri.

The Association has been, and intends to continue to be, a community-oriented
financial institution offering financial services to meet the needs of the
market area it serves.  The Association attracts deposits from the general
public and uses such funds together with FHLB advances to originate loans
secured by first mortgages on owner-occupied one- to four-family residences and
construction loans in its market area.  To a lesser extent, the Association
originates land, commercial real estate, multifamily and consumer loans in its
market area.

                                       2
<PAGE>
 
                        SELECTED CONSOLIDATED FINANCIAL
                        -------------------------------
                         AND OTHER DATA OF THE COMPANY
                         -----------------------------



Set forth below are selected consolidated financial and other data of the
Company.  The financial data is derived in part from, and should be read in
conjunction with, the Consolidated Financial Statements and Notes thereto
presented elsewhere in this Annual Report.
<TABLE>
<CAPTION>
 
                                                                  At September 30,
                                            -------------------------------------------------------------
                                               1996          1995          1994        1993        1992
                                            ----------    -----------    --------    --------    --------
<S>                                         <C>           <C>            <C>         <C>         <C>
                                                                   (In thousands)

Selected Financial Condition Data:
----------------------------------        
Total assets                                $  186,346    $  173,077     $144,821    $142,334    $137,427
Loans receivable, net                          154,444       129,740      113,981     110,023     112,863
Mortgage-backed securities                          13            17           20          29          32
Investment securities                           18,297        26,473       16,309      11,850       6,088
Cash and cash equivalents                        3,783         3,315        1,072       1,584       1,648
Certificates of deposit in other                 2,500         8,611       10,221      16,054      13,822
 financial institutions
Savings deposits                               123,108       121,280      123,110     122,378     119,508
FHLB advances                                   12,250             -            -           -           -
Total stockholders' equity                      46,815        48,727       19,267      17,740      15,491
 
 
                                                               Year Ended September 30,
                                            -------------------------------------------------------------
                                                  1996          1995         1994        1993        1992
                                            ----------    ----------     --------    --------    --------
                                                      (In thousands, except share information)
 
Selected Operations Data:
-------------------------                 
Total interest income                       $   13,921    $   12,289     $ 10,662    $ 11,100    $ 12,016
Total interest expense                           6,679         6,317        5,710       6,203       7,388
                                            ----------    ----------     --------    --------    --------
          Net interest income                    7,242         5,972        4,952       4,897       4,628
 
Provision for loan losses                          368           120          252           9          76
                                            ----------    ----------     --------    --------    --------
          Net interest income after
           provision for loan losses             6,874         5,852        4,700       4,888       4,552
                                            ----------    ----------     --------    --------    --------
 
Loan and deposit service charges                   130           131          136         140         158
(Loss) gain on sales of investment                   -            (4)           7           -           -
 securities
Other income                                        92           100           43          46          37
                                            ----------    ----------     --------    --------    --------
          Total noninterest income                 222           227          186         186         195
                                            ----------    ----------     --------    --------    --------
 
Total noninterest expense                        3,772         2,503        2,443       1,942       2,079
-------------------------                   ----------    ----------     --------    --------    --------
          Earnings before income taxes and
           cumulative effect of a change in      3,324         3,576        2,443       3,132       2,668
           accounting principle
 
Income taxes                                     1,214         1,272          894       1,180       1,021
Cumulative effect of a change in
 accounting for                                      -             -            -         289           -
 income taxes (1)                           ----------    ----------     --------    --------    --------
          Net earnings                      $    2,110    $    2,304     $  1,549    $  2,241    $  1,647
                                            ==========    ==========     ========    ========    ========
 
Net earnings per share                            0.77          0.83            -           -           -
                                            ==========    ==========     ========    ========    ========
 
Average common shares outstanding            2,740,759     2,784,906            -           -           -
                                            ==========    ==========     ========    ========    ========
 
(Footnotes on the following page)
 
</TABLE>

                                       3
<PAGE>
 
<TABLE>
<CAPTION>
 
                                                     At or For the Year Ended September 30,
                                            --------------------------------------------------------
                                              1996        1995        1994        1993        1992
                                            --------    --------    --------    --------    --------
<S>                                         <C>         <C>         <C>         <C>         <C>
 
Selected Financial Ratios and Other
 Data (1):
----------------------------------------
Performance Ratios:
  Return on assets (ratio of earnings
   before cumulative effect of a change in          
   accounting principle to average total
   assets)                                     1.20%       1.45%       1.08%       1.39%       1.20%
  Return on equity (ratio of earnings
   before cumulative effect of a change in          
   accounting principle to average equity)     4.43        6.62        8.26       11.62       11.20
  Interest rate spread (2):
     Average during period                     2.78        2.71        2.89        2.92        2.79
     End of period                             2.71        2.35        2.67        2.55        2.82
  Net interest margin (3)                      4.23        3.84        3.50        3.54        3.45
  Dividend payout ratio                       36.36        8.43           -           -           -
  Ratio of noninterest expense to
   average total assets (4)                    2.14        1.57        1.70        1.39         1.5
  Ratio of noninterest income to
   average total assets                        0.13        0.14        0.13        0.13        0.14
  Ratio of average interest-earning
   assets to average interest-bearing
   liabilities                               137.06      127.79      115.12      113.88      111.97
 
Quality Ratios:
  Nonperforming loans to total loans
   receivable at end of period                 0.84        0.92        0.97        2.03        2.25
  Allowance for loan losses to
   nonperforming loans                        91.54       74.46       71.51       26.64       23.99
  Allowance for loan losses to total
   loans receivable                            0.77        0.69        0.69        0.54        0.54
  Nonperforming assets to total assets
   at end of period                            0.83        0.77        0.85        1.86        2.35
  Classified assets to total assets (5)        4.15        2.26        2.93        5.14        5.39
   Ratio of net charge-offs to average
    loans receivable                           .006        .002        0.01        0.02           -
 
Capital Ratios (6):
  Equity to total assets at end of            25.12       28.15       13.30       12.46       11.27
   period
  Average equity to average assets            27.06       21.96       13.06       11.99       10.76
 
Other Data:
  Number of full-service offices              3           3           3           3           3
  Number of loan production offices           1           1           1           1           1
  Real estate loan originations (in         $92,606     $64,257     $54,474     $41,748     $44,664
   thousands)
 
</TABLE>
(1)  The Association adopted Statement of Financial Accounting Standards
     ("SFAS") No. 109 during the year ended September 30, 1993.
(2)  Interest rate spread represents the difference between the weighted average
     yield on interest-earning assets and the weighted average rate on interest-
     bearing liabilities.
(3)  Net interest margin represents net interest income as a percentage of
     average interest-earning assets.
(4)  Without the SAIF assessment of $800,000, noninterest expense would have
     been $2,972,000 for 1996 or 1.69% of average total assets.
(5)  Includes assets designated as Special Mention.
(6)  For a discussion of the Association's regulatory capital ratios, see
     "Management's Discussion and Analysis of Financial Condition and Results of
     Operations - Liquidity and Capital Resources."


                                       4
<PAGE>
 
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                      ------------------------------------
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                ------------------------------------------------



General
-------

Cameron Financial Corporation ("Cameron Financial" and, with its subsidiary, the
"Company") was formed in December 1994 by The Cameron Savings & Loan
Association, F.A., (the "Association") to become the holding company of the
Association.  The acquisition of the Association by Cameron Financial was
consummated on March 31, 1995 in connection with the Association's conversion
from the mutual to the stock form (the "Conversion").  All references to the
Company prior to March 31, 1995, except where otherwise indicated, are to the
Association and its subsidiary on a consolidated basis.

The Company's results of operation depend primarily on its level of net interest
income, which is the difference between interest earned on interest-earning
assets, consisting primarily of mortgage loans and investments, and the interest
paid on interest-bearing liabilities, consisting primarily of deposits and
Federal Home Loan Bank (FHLB) advances.  Net interest income is a function of
the Company's "interest rate spread," which is the difference between the
average yield earned on interest-earning assets and the average rate paid on
interest-bearing liabilities, as well as a function of the average balance of
interest-earning assets as compared to interest-bearing liabilities. The
interest rate spread is affected by regulatory, economic and competitive factors
that influence interest rates, loan demand and deposit flows.  The Company, like
other financial institutions, is subject to interest-rate risk to the degree
that its interest-earning assets mature or reprice at different times, or on a
different basis, than its interest-bearing liabilities. The Company's operating
results are also affected by the amount of its noninterest income, including
loan fees and service charges and other income, which includes commissions from
sales of insurance by the Association's service corporation.  Noninterest
expense consists principally of employee compensation, occupancy expense, data
processing, federal deposit insurance premiums, advertising, real estate owned
operations and other operating expenses.  The Company's operating results are
significantly affected by general economic and competitive conditions, in
particular, the changes in market interest rates, government policies and
actions by regulatory authorities.

Financial Condition
-------------------

Total assets increased $13.2 million, or 7.63%, to $186.3 million at September
30, 1996 from $173.1 million at September 30, 1995.  The increase was primarily
funded by an increase in FHLB advances of $12.3 million and a savings deposit
increase of $1.8 million.  These funds, and a $13.8 million decrease in
investment securities, cash and cash equivalents and certificates of deposit in
other financial institutions, were used to finance a $24.7 million increase in
net loans receivable.

Net loans receivable increased by $24.7 million, or 19.04%, to $154.4 million at
September 30, 1996 from $129.7 million at September 30, 1995 due primarily to
the $14.3 million increase in one- to four-family permanent lending, the $5.5
million increase in land loans, and the $2.4 million increase in short-term
construction lending, net of loans in process.

Investment securities, certificates of deposit in other financial institutions
and cash equivalents decreased $13.8 million, or 35.9%, to $24.6 million at
September 30, 1996 from $38.4 million at September 30, 1995.  This decrease
primarily represents the maturity of investment securities and certificates and
reinvestment of the proceeds in loans.

                                       5
<PAGE>
 
Deposits increased $1.8 million, or 1.48%, to $123.1 million at September 30,
1996 from $121.3 million at September 30, 1995.  FHLB advances increased to
$12.3 million at September 30, 1996 from none at September 30, 1995.  During the
last several years, loan originations have exceeded savings inflows, loan
repayments and cash provided by operations.  Prior to fiscal year 1996, the
excess resulted in reductions in the investment securities portfolio and total
liquidity.  It is anticipated that FHLB advances will continue to supplement
projected savings inflows and loan repayments to fund continued loan demand.

Total equity decreased $1.9 million, to $46.8 million at September 30, 1996 from
$48.7 million at September 30, 1995.  Earnings for the year provided a $2.1
million increase, which was offset by the purchase of 177,248 shares of treasury
stock for $3.9 million, declaration of dividends of $752,000 and the adoption of
the Recognition and Retention Plan (RRP) and amortization of RRP and unearned
ESOP shares.

The Association's capital exceeds all of the capital requirements imposed by
FIRREA.  OTS regulations provide that an institution that exceeds all capital
requirements before and after a proposed capital distribution and, like the
Association, has not been notified of a need for more than normal supervision
could, after prior notice but without approval by the OTS, make capital
distributions during the calendar year of up to 100% of its net income to date
during the calendar year plus the amount that would reduce by one-half its
"surplus capital ratio" (the excess capital over its capital requirements) at
the beginning of the calendar year.  Any additional capital distributions would
require prior regulatory approval.

The Association declared and paid a dividend of $2,248,000 to Cameron Financial
in fiscal year 1996 and has notified OTS of it plans to declare an additional
$47,000 dividend to Cameron Financial in mid-December 1996.  Those dividends
approximate the Association's net income from July 1, 1995 through September 30,
1996.

Results of Operations
---------------------

The Company's results of operations depend primarily on the level of its net
interest income and noninterest income and its control of operating expenses.
Net interest income depends upon the volume of interest-earning assets and
interest-bearing liabilities and the interest rates earned or paid on them.

The Company's noninterest income consists primarily of fees charged on
transaction accounts and fees charged for delinquent payments received on
mortgage and consumer loans.  In addition, noninterest income is derived from
the activities of the Association's wholly-owned subsidiary, which engages in
the sale of various insurance products.

The schedule on the following page presents, for the periods indicated, the
total dollar amount of interest income from average interest-earning assets and
the resultant yields, as well as the total dollar amount of interest expense on
average interest-bearing liabilities and resultant rates.  The average yields
include loan fees which are considered adjustments to yields.  The amount of
interest income resulting from the recognition of loan fees was $397,000,
$321,000 and $275,000 for the years ended September 30, 1996, 1995 and 1994,
respectively.  No tax-equivalent adjustments have been made.  All average
balances are monthly average balances.  Management does not believe that the use
of monthly balances instead of daily balances has caused a material difference
in the information presented.  Nonaccruing loans have been included as loans
carrying a zero yield.

                                       6
<PAGE>

<TABLE> 
<CAPTION> 
                                                                               Years Ended September 30,
                                                     ------------------------------------------------------------------------
                                                                      1996                                1995     
                                                     --------------------------------------    ------------------------------
                                                       Average        Interest                   Average    Interest       
                                                     Outstanding       Earned/      Yield/     Outstanding   Earned/   Yield/ 
                                                       Balance          Paid         Rate        Balance      Paid      Rate  
                                                       -------          ----         ----        -------      ----      ----  
                                                                              (Dollars in thousands)
<S>                                                 <C>             <C>             <C>      <C>           <C>        <C> 
Interest-earning assets:
  Loans receivable (1)                              $  141,896      $  12,181        8.58%   $  122,970    $  10,472    8.52%   
  Mortgage-backed securities                                15              2       13.33            18            2   11.11    
  Investment securities                                 21,955          1,319        6.01        20,771        1,190    5.73    
  Certificates of deposit                                3,525            225        6.38         8,278          484    5.85    
  Other interest-bearing deposits                        2,572            103        4.00         2,063           50    2.42    
  Federal Home Loan Bank (FHLB) stock                    1,254             91        7.26         1,235           91    7.37    
                                                      --------         ------        ----       -------       ------    ----   
              Total interest-earning assets (1)        171,217         13,921        8.13       155,335       12,289    7.91   
                                                                       ------        ----                     ------    ----   

Noninterest earning assets                               4,954                                    3,855                         
                                                      --------                                  -------                      
              Total average assets                  $  176,171                               $  159,190                         
                                                       =======                                  =======                        

Interest-bearing liabilities:
  Passbook accounts                                 $   10,710            348        3.25     $  12,458          426    3.42    
  NOW and money market accounts                         12,915            364        2.82        14,758          418    2.83    
  Certificates                                          98,102          5,780        5.89        94,031        5,454    5.80    
  FHLB advances                                          3,192            187        5.86           308           19    6.17    
                                                      --------         ------        ----       -------       ------    ----   
              Total interest-bearing liabilities       124,919          6,679        5.35       121,555        6,317    5.20    
                                                                       ------        ----                     ------    ----   

Noninterest bearing liabilities                          3,587                                    2,675
                                                      --------                                   ------
              Total average liabilities             $  128,506                               $  124,230                        
                                                       =======                                  =======                       

Net interest income                                                 $   7,242                               $  5,972           
                                                                       ======                                  =====         
Net interest rate spread (2)                                                         2.78%                              2.71%  
                                                                                     ====                               ====  
Net interest-earning assets                         $   46,298                                $  33,780                        
                                                        ======                                  =======                       
Net interest margin (3)                                                              4.23%                              3.84%  
                                                                                     ====                               ====   
Average interest-earning assets to average
      interest-bearing liabilities                                     137.06%                                        127.79%  
                                                                       ======                                         ======



                                                    ---------------------------------------
                                                                      1994                            
                                                    ---------------------------------------                   
                                                      Average         Interest                             
                                                    Outstanding       Earned/       Yield/            
                                                      Balance           Paid         Rate             
                                                      -------           ----         ----             
                                                            (Dollars in thousands)
Interest-earning assets:                                                                              
      Loans receivable (1)                         $  111,277       $   9,339        8.36%    
      Mortgage-backed securities                           24               2        8.33      
      Investment securities                            15,158             724        4.78      
      Certificates of deposit                          12,219             486        3.98      
      Other interest-bearing deposits                   1,211               9        0.74      
      Federal Home Loan Bank (FHLB) stock               1,235             102        8.26      
                                                      -------          ------        ----     
              Total interest-earning assets (1)       141,594          10,662        7.53     
                                                                       ------        ----     
                                                                                                  
Noninterest earning assets                              2,013                                     
                                                      -------                                   
              Total average assets                 $  143,607                                     
                                                      =======                                     
                                                                                                  
Interest-bearing liabilities:                                                                     
      Passbook accounts                            $   16,393             534        3.26      
      NOW and money market accounts                    17,106             493        2.88      
      Certificates                                     89,496           4,683        5.23      
      FHLB advances                                       -               -          0.00      
                                                      -------           -----        ----     
              Total interest-bearing liabilities      122,995           5,710        4.64      
                                                                        -----        ----     
                                                                                                  
Noninterest bearing liabilities                         1,863                                    
                                                      -------                                   
              Total average liabilities            $  124,858                                    
                                                      =======                                    
                                                                                                  
Net interest income                                                 $   4,952                  
                                                                        =====                  
Net interest rate spread (2)                                                         2.89%    
                                                                                     ====     
Net interest-earning assets                        $   18,599                                    
                                                      =======                                    
Net interest margin (3)                                                              3.50%    
                                                                                     ====     
Average interest-earning assets to average                                                         
      interest-bearing liabilities                                     115.12%          
                                                                       ======
</TABLE> 

(1) Calculated net of deferred loan fees and discounts, loans in process and
    loss reserves.

(2) Net interest rate spread represents the difference between the average yield
    on interest-earning assets and the average rate on interest-bearing
    liabilities.

(3) Net interest margin represents net interest income divided by average
    interest-earning assets.

                                       7
<PAGE>
 
The following schedule presents the weighted average yields earned on loans,
investments and other interest-earning assets, and the weighted average rates
paid on deposits and FHLB advances and the resultant interest rate spreads at
the dates indicated:
<TABLE>
<CAPTION>
 
                                                 At September 30,
                                            --------------------------
                                             1996      1995      1994
                                            ------    ------    ------
 
Weighted average yield on:
<S>                                         <C>       <C>       <C>
 Loans receivable                            8.48%     8.32%     8.01%
 Mortgage-backed securities                 10.48     10.59     10.57
 Investment securities                       6.20      5.88      5.02
 Certificates of deposit in other            5.85      6.37      4.71
  financial institutions
 Other interest-bearing deposits             3.69      4.23      1.00
 FHLB stock                                  7.25      7.00      8.50
 Combined weighted average yield on
  interest-earning assets                    8.11      7.76      7.40
                                            -----     -----     -----
 
Weighted average rate paid on:
 Passbook accounts                           3.25      3.25      3.25
 NOW and money market accounts               2.84      2.84      2.88
 Certificates                                5.89      5.99      5.32
 FHLB advances                               6.09         -         -
 Combined weighted average rate paid on
  interest-bearing liabilities               5.40      5.41      4.73
                                            -----     -----     -----
 
     Spread                                  2.71%     2.35%     2.67%
                                            =====     =====     =====
 
</TABLE>

                                       8
<PAGE>
 
Rate/Volume Analysis
--------------------

The following schedule presents the dollar amount of changes in interest income
and interest expense for major components of interest-earning assets and
interest-bearing liabilities.  It distinguishes between the changes due to
changes in outstanding balances and those due to changes in interest rates.  For
each category of interest-earning assets and interest-bearing liabilities,
information is provided on changes attributable to (i) changes in volume (i.e.,
changes in volume multiplied by prior interest rate) and (ii) changes in rate
(i.e., changes in rate multiplied by prior volume).  For purposes of this table,
changes attributable to both rate and volume, which cannot be segregated, have
been allocated proportionately to the changes due to volume and the changes due
to rate.
<TABLE>
<CAPTION>
 
                                                                   Year Ended September 30,
                                            -----------------------------------------------------------------------
                                                      1996 vs. 1995                         1995 vs. 1994
                                            ----------------------------------    ---------------------------------
                                                  Increase                             Increase
                                                 (Decrease)                           (Decrease)                   
                                                   Due to             Total             Due to             Total   
                                            --------------------     Increase     -------------------     Increase 
                                             Volume       Rate      (Decrease)     Volume       Rate     (Decrease)
                                            ---------    -------    ----------    ---------    ------    ----------
 
Interest-earning assets:
<S>                                         <C>          <C>        <C>           <C>          <C>       <C>
  Loans receivable                            $1,634       $ 75        $1,709       $  951      $182        $1,133
  Mortgage-backed securities                       -          -             -            -         -             -
  Investment securities                           70         59           129          303       163           466
  Certificates of deposit in other
     financial institutions                     (308)        49          (259)        (157)      155            (2)
  Other interest-bearing deposits                 14         39            53           11        30            41
  FHLB stock                                       1         (1)            -            -       (11)          (11)
                                              ------       ----        ------       ------      ----        ------
          Total interest-earning assets        1,411        221         1,632        1,108       519         1,627
----------------------------------------      ------       ----        ------       ------      ----        ------
 
Interest-bearing liabilities:
  Passbook accounts                              (58)       (20)          (78)        (135)       27          (108)
  NOW and money market accounts                  (53)        (1)          (54)         (66)       (9)          (75)
  Certificates                                   240         86           326          245       526           771
  FHLB advances                                  169         (1)          168           19         -            19
                                              ------       ----        ------       ------      ----        ------
          Total interest-bearing                 298         64           362           63       544           607
           liabilities                        ------       ----        ------       ------      ----        ------
 
          Net interest income                 $1,113       $157        $1,270       $1,045      $(25)       $1,020
                                              ======       ====        ======       ======      ====        ======
 
</TABLE>

                                       9
<PAGE>
 
Comparison of Operating Results for the Years Ended September 30, 1996 and
--------------------------------------------------------------------------
September 30, 1995
------------------

General.  Net earnings for the year ended September 30, 1996 decreased by
$194,000, or 8.42%, to $2.1 million, or $0.77 per share, from $2.3 million, or
$0.83 per share, for the year ended September 30, 1995.  The decrease was
primarily due to the combined effects of a $1.3 million increase in net interest
income and a $58,000 decrease in income taxes offset by a $248,000 increase in
the provision for loan loss, a $5,000 decrease in noninterest income and a $1.3
million increase in noninterest expense.  For the years ended September 30, 1996
and 1995, the returns on average assets were 1.20% and 1.45%, respectively,
while the returns on average equity were 4.43% and 6.62%, respectively.

A provision in the Omnibus Appropriations Bill passed by Congress and signed by
President Clinton on September 30, 1996 included an anticipated special
assessment to recapitalize the Savings Association Insurance Fund (SAIF).  The
65.7 cents per $100 of qualifying accounts as of March 31, 1995 created a pre-
tax expense of $800,000 to the Association.  Without the SAIF assessment, net
income would have been $2.6 million, return on average assets would have been
1.49%, return on average equity would have been 5.49% and earnings per share
would have been $.96 for the fiscal year ended September 30, 1996.

The recapitalization of SAIF is anticipated to reduce the future deposit
insurance premiums from 23 cents per $100 of deposits to 6.4 cents per $100 of
deposits.  The 6.4 cent premium is projected for the years 1997 through 1999,
then decreasing further to 2.4 cents from 2000 until 2017, assuming a merger of
SAIF and the Bank Insurance Fund (BIF).

Net Interest Income.  For the year ended September 30, 1996, net interest income
increased by $1.3 million to $7.2 million from $6.0 million for 1995.  This
reflects an increase of $1.6 million in interest income to $13.9 million from
$12.3 million and an increase of $362,000 in interest expense to $6.7 million
from $6.3 million.  The increase in interest income was primarily due to an
increase in total interest-earning assets and a change in asset mix with a
higher percentage of loans as compared to investment securities.  The increase
in interest expense was due to increased interest-bearing liabilities and
increased rates paid.

Interest Income.  Interest income for the year ended September 30, 1996
increased $1.6 million to $13.9 million from $12.3 million for the year ended
September 30, 1995.  The $15.9 million increase in average interest-earning
assets resulted in an increase in interest income of $1.4 million.  The increase
in average yield on interest-earning assets provided $221,000 additional
interest income in fiscal 1996.

Interest income on loans increased $1.7 million, or 16.32%, to $12.2 million
from $10.5 million for the year ended September 30, 1995.  Interest income on
investment securities, certificates of deposit and other interest-bearing
deposits decreased $77,000, or 4.24%, to $1.6 million from $1.7 million for the
year ended September 30, 1995.  Interest income on loans increased due to
increased average balances and increased yields on those balances.  Decreases in
average balances of investment securities, certificates of deposit and other
interest-bearing deposits offset increased yields on those items.  This was the
result of the changing mix of assets with higher concentration of assets in
loans.

Interest Expense.  Interest expense for the year ended September 30, 1996
increased $362,000 to $6.7 million from $6.3 million for the year ended
September 30, 1995.  The increase was due to increased average balances
outstanding on interest-bearing liabilities and an increase in the average rate
paid on certificates of deposit.  Depositors continued their transfer of funds
from passbook and checking accounts to higher rate certificates.  Average
balances in certificates of

                                      10
<PAGE>
 
deposit increased $4.1 million to $98.1 million for the year ended September 30,
1996 from $94.0 million for the prior fiscal year.  Average noncertificate
balances decreased $3.6 million to $23.6 million from $27.2 million for the
prior fiscal year.  Interest expense on FHLB advances increased to $187,000 for
the year ended September 30, 1996 from $19,000 for the prior year.  The
Association borrowed $12.3 million in fiscal 1996 compared to $2.0 million for
part of fiscal 1995.

Provision for Loan Losses.  The Association maintains a program for establishing
general loan loss reserves by classifying various components of the loan
portfolio by potential risk. Management reviews the composition of the loan
portfolio monthly and adjusts the valuation allowance.  In addition, the
Internal Auditor reviews the general valuation allowance on a quarterly basis
and reports the findings to the Board of Directors.  During the year ended
September 30, 1996, the Association charged $368,000 against earnings as a
provision for loan losses compared to $120,000 for the year ended September 30,
1995.  This resulted in an allowance for loan losses of $1.4 million, or 0.77%
of total loans receivable at September 30, 1996, compared to $994,000, or 0.69%
of total loans receivable at September 30, 1995.  The ratio increased during
fiscal 1996 due to increased land and development loans, consumer loans,
construction loans and one- to four-family loans.  Land and development loans
increased to $9.6 million from $4.1 million, consumer loans increased to $8.3
million from $5.6 million, construction loans increased to $41.6 million from
$33.0 million, and one- to four-family loans increased to $109.3 million from
$95.0 million.  Net charge-offs totaled $9,000 and $2,000 in 1996 and 1995,
respectively.  While the Association has not experienced any significant charge-
offs in the past three years, the allowance for loan losses has been increased
to recognize the changing composition of the Association's loan portfolio and
the risk associated with different types of loans.

The Association had $2.3 million in loans classified as substandard, doubtful or
loss at September 30, 1996, compared to $1.8 million at September 30, 1995.

Management will continue to monitor its allowances for loan losses and make
future additions to the allowance through provision for loan losses as economic
conditions dictate.  Although the Association maintains its allowance for loan
losses at a level which it considers to be adequate to provide for potential
losses, there can be no assurance that future losses will not exceed estimated
amounts or that additional provisions for loan losses will not be required in
future periods.

Noninterest Income.  For the year ended September 30, 1996, noninterest income
was $222,000 compared to $227,000 for the year ended September 30, 1995.  Loan
service charges, which consist primarily of late charges on loans receivable,
were $61,000 and $58,000 for fiscal 1996 and 1995, respectively.  The increase
is primarily due to the increase in the number of loans outstanding.  Service
charges on transaction accounts were $55,000 and $58,000 for fiscal 1996 and
1995, respectively.  The decrease is due to fewer NOW accounts and a
corresponding decline in the service charges associated with the maintenance of
such accounts.  Commissions from insurance sales by the Association's service
corporation were $22,000 and $24,000 for fiscal 1996 and 1995.  Gains on the
sale of loans originated for sale were $17,000 and $19,000 for fiscal 1996 and
1995, respectively.  There were no gains or losses on sales of equity securities
in fiscal 1996 compared to a net loss of $4,000 in fiscal 1995.  A patronage
dividend of $40,000 was received in 1996 from a cooperative service bureau
compared to $52,000 in 1995.

Noninterest Expense.  Noninterest expense increased $1.3 million, or 50.7%, to
$3.8 million for the year ended September 30, 1996 from $2.5 million for the
year ended September 30, 1995. Compensation, payroll taxes and fringe benefits
expense increased $220,000 in fiscal 1996 compared to 1995.  Expenses associated
with the RRP adopted January 29, 1996 were $186,000. There was no related
expense in 1995.  ESOP expenses increased $122,000 for fiscal 1996 to

                                      11
<PAGE>
 
$425,000.  The increase was due to more shares allocated and a higher average
monthly price in 1996 compared to 1995.  Cash compensation increased $89,000 in
fiscal 1996 to $1.24 million from $1.15 million in 1995.  The increase was due
to more employees, raises to existing employees and an increase in incentive
bonuses.  Payroll taxes and other fringe benefits increased $19,000 due to
increased compensation.  In accordance with SFAS No. 91, the Association defers
certain direct loan origination and modification costs and amortizes these costs
as an adjustment to yield.  The Association has deferred $100,000 more in
compensation costs for fiscal 1996 than 1995.  In fiscal 1995, the Association
accrued bonus expense of $94,000.  There was no related expense in fiscal 1996.
Occupancy expense increased $22,000 in fiscal 1996 to $209,000 from $187,000 in
1995.  The increase was primarily due to increased depreciation on new equipment
during the year.  Federal insurance premiums increased $799,000 to $1.1 million
from $283,000 for 1995.  The increase was primarily due to the special SAIF
assessment.  Other operating expenses increased to $585,000 for fiscal 1996 from
$390,000 in fiscal 1995.  The increase was primarily due to increased expenses
as a publicly-owned stock institution.

Income Taxes.  Income taxes decreased to $1.2 million for fiscal 1996 from $1.3
million in fiscal 1995.  The decrease was due to a decrease in taxable income
for 1996 as compared to 1995.

Comparison of Operating Results for the Years Ended September 30, 1995 and
--------------------------------------------------------------------------
September 30, 1994
------------------

General.  Net earnings for the year ended September 30, 1995 increased by
$755,000, or 48.7%, to $2.3 million from $1.5 million for the year ended
September 30, 1994.  The increase was primarily due to the combined effects of a
$1.0 million increase in net interest income, a $132,000 decrease in the
provision for loan losses, a $41,000 increase in noninterest income, offset by a
$60,000 increase in noninterest expense, and a $378,000 increase in income
taxes.  For the years ended September 30, 1995 and 1994, the returns on average
assets were 1.45% and 1.08%, respectively, while the returns on average equity
were 6.62% and 8.26%, respectively.

Net Interest Income.  For the year ended September 30, 1995, net interest income
increased by $1.0 million to $6.0 million from $5.0 million for 1994.  This
reflects an increase of $1.6 million in interest income to $12.3 million from
$10.7 million and an increase of $607,000 in interest expense to $6.3 million
from $5.7 million.  The increase in interest income was primarily due to an
increase in the ratio of average interest-earning assets to average interest-
bearing liabilities to 127.8% in 1995 from 115.1% in 1994.  The increase in the
ratio was due primarily to the deployment of the $29.4 million of net proceeds
from the Company's stock conversion.  The average net interest rate spread
declined to 2.71% for the year ended September 30, 1995 from 2.89% for the year
ended September 30, 1994.  The decline is attributed to the average yield on
interest-bearing liabilities increasing more rapidly than the yield on interest-
earning assets during the year ended September 30, 1995.  In addition, the net
proceeds of the conversion were invested in short-term assets with yields that
were below yields on existing assets of the Association.

Interest Income.  Interest income for the year ended September 30, 1995
increased $1.6 million to $12.3 million from $10.7 million for the year ended
September 30, 1994.  The $13.7 million increase in average interest-earning
assets resulted in an increase in interest income of $1.1 million in fiscal
1995.  The increase in average yield on interest-earning assets provided
$519,000 additional interest income in fiscal 1995.

                                      12
<PAGE>
 
The primary reason for interest income increasing was interest on loans
receivable increasing by $1.1 million, or 12.13%, to $10.5 million for the year
ended September 30, 1995 from $9.3 million for the year ended September 30,
1994, and interest on investment securities increasing by $466,000, or 64.36%,
to $1.2 million for the year ended September 30, 1995 from $724,000 for the year
ended September 30, 1994.  Interest income increases from both loans and
investments were due to volume increases, from investment of the proceeds from
the stock conversion, and increases in the respective average yields in 1995
compared with 1994.

Interest Expense.  Interest expense for the year ended September 30, 1995
increased $607,000 to $6.3 million from $5.7 million for the year ended
September 30, 1994.  The increase was primarily due to the weighted average
interest rate on interest-bearing liabilities increasing to 5.20% in 1995 from
4.64% in 1994.  With general interest rates increasing from April 1994 through
December 1994, depositors transferred funds from passbook and checking accounts
to higher rate certificates.  Average balances in certificates of deposits
increased $4.5 million to $94.0 million for the year ended September 30, 1995
from $89.5 million for the year ended September 30, 1994.  Average
noncertificate balances decreased $6.3 million to $27.2 million for the year
ended September 30, 1995 from $33.5 million for the year ended September 30,
1994.  The Association borrowed up to $2.0 million from the FHLB of Des Moines
in January 1995 to meet short-term cash needs, on which $19,000 interest was
paid.  Those advances were repaid in full during March 1995.  There were no FHLB
advances during fiscal 1994.

Provision for Loan Losses.  The Association maintains a program for establishing
general loan loss reserves by classifying various components of the loan
portfolio by potential risk.  Management reviews the composition of the loan
portfolio monthly and adjusts the valuation allowances.  Quarterly, the Internal
Auditor/Compliance Officer reviews the general valuation allowances for adequacy
and reports the findings to the Board of Directors.  During the fiscal year
ended September 30, 1995, the Association charged $120,000 against earnings as a
provision for loan losses compared to a provision of $252,000 for the year ended
September 30, 1994. This resulted in an allowance for loan losses of $994,000,
or .69% of total loans receivable at September 30, 1995, compared to $876,000,
or .69% of total loans receivable at September 30, 1994. The allowance for loan
losses as a percentage of nonperforming loans increased to 74.5% at September
30, 1995 from 71.5% at September 30, 1994.  The ratio increased during fiscal
1995 due to increased construction lending which is assigned a higher risk
factor.  Total construction loans increased to $33.0 million at September 30,
1995 compared to $25.2 million at September 30, 1994.  The fiscal 1995 net
charge-offs against general valuation allowances totaled $2,000 and the net
charge-offs for fiscal 1994 were $13,000.  While the Association has not
experienced any significant charge-offs in the past three years, the decision
was made to increase the allowance for loan losses based on a more refined
evaluation process which, in management's view, more fully recognizes the
changing composition of the Association's loan portfolio and the inherent risk
associated with different types of loans.

The Association had $1.8 million in loans classified as substandard, doubtful or
loss at both September 30, 1995 and 1994.

Management will continue to monitor its allowance for loan losses and make
future additions to the allowance through the provision for loan losses as
economic conditions dictate.  Although the Association maintains its allowance
for loan losses at a level which it considers to be adequate to provide for
potential losses, there can be no assurance that future losses will not exceed
estimated amounts or that additional provisions for loan losses will not be
required in future periods.

                                      13
<PAGE>
 
Noninterest Income.  For the year ended September 30, 1995, noninterest income
was $227,000 compared with $186,000 for the year ended September 30, 1994.
Included in noninterest income is loan service charges which consist primarily
of late charges on loans receivable of $58,000 and $60,000 for fiscal 1995 and
1994, respectively, and service charges on transaction accounts of $58,000 and
$65,000 for fiscal 1995 and 1994, respectively.  The respective decreases
occurred largely as a result of a decline in delinquencies and late fees as well
as a decline in the number of NOW accounts and a corresponding decline in the
service charges associated with the maintenance of such accounts.  Commissions
from insurance sales by the Association's service corporation of $24,000 and
$20,000 for fiscal 1995 and 1994 and gains on the sale of loans originated for
sale of $20,000 and $18,000 for fiscal 1995 and 1994 are included as other
income.  During 1995, gains versus losses on the sales of equity securities
netted a loss of $4,000 compared to a profit of $7,000 during 1994.  A patronage
dividend of $52,000 was received in 1995 from a cooperative service bureau,
which compares with $1,000 during 1994.

Noninterest Expense.  Noninterest expense increased by $60,000, or 2.5%, to $2.5
million for the year ended September 30, 1995 from $2.4 million for the year
ended September 30, 1994.  Compensation, payroll taxes and fringe benefits
expense increased $70,000 in fiscal 1995 over fiscal 1994.  ESOP expense for
1995 was $302,000, an increase of $243,000 over the $59,000 pension plan expense
for 1994.  The Association also accrued employee bonuses of $94,000 during 1995,
which had previously been expensed when paid.  Adoption by the Association in
fiscal 1994 of a supplemental retirement plan for members of the board, created
an initial one-time charge of $380,000 reflecting past service costs.  Federal
insurance premiums remained consistent at $283,000 for 1995 compared with
$282,000 for 1994.  All other operating expenses combined increased $11,000 to
$786,000 in fiscal 1995 from $775,000 in fiscal 1994.

Income Taxes.  Income taxes increased by $378,000 to $1.3 million during the
year ended September 30, 1995 from $894,000 for the year ended September 30,
1994, primarily due to an increase in income before income taxes.  The effective
tax rates were 35.6% and 36.6% for fiscal 1995 and 1994.

Interest Rate Sensitivity
-------------------------

Net Portfolio Value.  Since 1982, the Association has measured its interest rate
sensitivity by computing the gap between the assets and liabilities which were
expected to mature or reprice within certain periods based on historically
gathered assumptions regarding loan prepayment and deposit decay rates.  In
addition, the Association has during recent years computed the amounts by which
the net present value of the Association's cash flows from assets, liabilities
and off-balance sheet items, if any (the institution's net portfolio value, or
"NPV"), would change in the event of a range of assumed changes in market
interest rates.  These computations estimate the effect on the Association's NPV
of instantaneous and permanent 1% to 4% increases and decreases in market
interest rates. The Board of Directors has established maximum increases and
decreases in NPV.  The following schedule indicates the Board limits and the
estimates of projected changes in NPV in the event of 1%, 2%, 3% and 4%
instantaneous and permanent increases and decreases in market interest rates,
respectively.  The changes in portfolio value are provided from an OTS report of
the Association at September 30, 1996.

                                      14
<PAGE>
 
<TABLE>
<CAPTION>
 
                                                      At September 30, 1996
                                                        Percent Change in
  Change in Market Interest Rate      Board Limit      Net Portfolio Value
----------------------------------    ------------    ----------------------
 
<S>                                   <C>             <C>
+4%                                           -40%                    -21.0%
+3                                            -30                     -15.0
+2                                            -20                      -9.0
+1                                            -10                      -3.0
-                                               -                         -
-1                                             -5                       1.0
-2                                             -5                      -1.0
-3                                             -5                      -2.0
-4                                             -5                      -2.0
</TABLE>
Computations of prospective effects of hypothetical interest rate changes are
based on numerous assumptions, including relative levels of market interest
rates, loan prepayments and deposit run-offs, and should not be relied upon as
indicative of actual results.  Further, the computations do not contemplate any
actions the Association may undertake in response to changes in interest rates.

Certain shortcomings are inherent in the method of analysis presented in both
the computation of NPV and in an analysis of the maturing and repricing of
interest-earning assets and interest-bearing liabilities.  Although certain
assets and liabilities may have similar maturities or periods within which they
will reprice, they may react differently to changes in market interest rates.
The interest rates on certain types of assets and liabilities may fluctuate in
advance of changes in market interest rates, while interest rates on other types
may lag behind changes in market rates.  Additionally, adjustable-rate mortgages
have features which restrict changes in interest rates on a short-term basis and
over the life of the asset.  The proportion of adjustable-rate loans could be
reduced in future periods if market interest rates would decrease and remain at
lower levels for a sustained period, due to increased refinance activity.
Further, in the event of a change in interest rates, prepayment and early
withdrawal levels would likely deviate significantly from those assumed in the
table.  Finally, the ability of many borrowers to service their adjustable-rate
debt may decrease in the event of a sustained interest rate increase.

Liquidity and Capital Resources
-------------------------------

The Association's primary sources of funds are deposits, repayments on and sales
of loans, FHLB advances, the maturity of investment securities and interest
income.  Although maturity and scheduled amortization of loans are relatively
predictable sources of funds, deposit flows and prepayments on loans are
influenced significantly by general interest rates, economic conditions and
competition.

The primary investing activity of the Association is the origination of loans to
be held for investment. For the fiscal years ended September 30, 1996 and 1995,
the Association originated loans for portfolio in the amounts of $98.1 million
and $66.8 million, respectively.  Purchases of loans during these periods
totaled $882,000 and $26,000, respectively.  The Association also originates
loans for sale.  For the fiscal years ended September 30, 1996 and 1995, the
Association originated $1.5 million and $1.1 million, respectively, of mortgage
loans for sale.  For the fiscal years ended September 30, 1996 and 1995, these
activities were funded primarily by principal repayments of $67.5 million and
$48.5 million, respectively, proceeds from the sale of loans of $1.5 million and
$1.1 million, respectively, and FHLB advances of $12.3 million in fiscal 1996.

                                      15
<PAGE>
 
The Association is required to maintain minimum levels of liquid assets under
OTS regulations.  Savings institutions are required to maintain an average daily
balance of liquid assets (including cash, certain time deposits, certain
bankers' acceptances, certain corporate debt securities and highly rated
commercial paper, securities of certain mutual funds and specified U. S.
government, state or federal agency obligations) of not less than 5.0% of its
average daily balance of net withdrawal accounts plus short-term borrowings.  It
is the Association's policy to maintain its liquidity portfolio in excess of
regulatory requirements.  The Association's eligible liquidity ratios were 6.43%
and 18.63%, respectively, at September 30, 1996 and 1995.

The Company's most liquid assets are cash and cash equivalents, which include
short-term investments.  The levels of these assets are dependent on the
operating, financing, lending and investing activities during any given period.
At September 30, 1996 and 1995, cash and cash equivalents were $3.8 million and
$3.3 million, respectively.  The increase in cash and cash equivalents in 1996
compared to 1995 results primarily from sources of cash receipts and the use of
cash to fund loans and investments. The principal components of cash provided
during the fiscal year ended September 30, 1996 were FHLB advances and maturing
investments. Additional sources of cash include loan repayments, sales of loans
and deposit activity.

Liquidity management for the Company is both an ongoing and long-term function
of the asset/liability management strategy.  Excess Association funds generally
are invested in overnight deposits at the FHLB of Des Moines.  Should the
Association require funds beyond its ability to generate them internally,
additional sources of funds are available through FHLB of Des Moines advances.
During fiscal 1996, the Association borrowed $12.3 million in FHLB advances.
The Association borrowed $2.0 million in FHLB advances to meet cash flow needs
in January 1995, repaying those advances in full during March 1995.  During the
last several years, loan originations have exceeded savings inflows, loan
repayments and cash provided by operations.  Prior to fiscal year 1996, the
excess resulted in reductions in the investment securities portfolio and total
liquidity.  To maintain liquidity above the required minimum, it is anticipated
that FHLB advances will continue to supplement projected savings inflows and
loan repayments to fund continued loan demand.

At September 30, 1996, the Association had outstanding loan commitments of $6.7
million, unused lines of credit of $1.5 million, and undisbursed loan funds in
process of approximately $19.5 million.  Construction of the new home office
building in Cameron continues.  Completion is expected in March 1997.  Estimated
construction costs are $4.2 million, of which approximately $2.1 million has
been disbursed.  In November 1996, the Association commenced a plan to purchase
a parcel of land for $850,000 in Liberty, Missouri for the purpose of building a
branch location and development and sale of the adjoining lots.  It is expected
that the construction costs of the new branch will be $1.0 million with
completion expected in December 1997.  The Association anticipates it will have
sufficient funds available to meet its current loan commitments, including loan
applications received and in process prior to the issuance of firm commitments
and building costs.  Certificates of deposit which are scheduled to mature in
one year or less at September 30, 1996 were $49.5 million.  Management believes
that a significant portion of such deposits will remain with the Association.

At September 30, 1996, the Association had tangible capital of $32.9 million, or
18.9% of total adjusted assets, which is approximately $30.3 million above the
minimum requirement of 1.5% of adjusted total assets in effect on that date.
The Association had core capital of $32.9 million, or 18.9% of adjusted total
assets, which is $27.7 million above the minimum leverage ratio of 3.0% in
effect on that date.  The Association had total risk-based capital of $33.1
million and total risk-weighted assets of $117.3 million, or total capital of
28.3% of risk-weighted assets.  This was $23.8 million above the 8.0%
requirement in effect on that date.

                                      16
<PAGE>
 
The deposits of savings associations such as the Association are presently
insured by the SAIF which along with the BIF is one of the two insurance funds
administered by the FDIC.  On September 30, 1996, President Clinton signed into
law the fiscal year 1997 Omnibus Appropriations Bill which included the Deposit
Insurance Funds Act of 1996.  Provisions of the bill included a one-time
assessment on SAIF-insured deposits.  The Association's assessment of $800,000
was recorded in the 1996 consolidated financial statements.  Following the
recapitalization, SAIF premiums will be reduced to the same level as for BIF
deposits.

Separately, Financing Corporation (FICO) bond payments will be shared by SAIF
and BIF-insured financial institutions with SAIF-insured institutions paying 80%
of the annual cost and BIF-insured institutions paying 20% of the annual cost
through December 31, 1999, after which assessments will be paid on a pro rata
basis.  Until then, the FICO assessment will be 1.3 basis points for banks
versus 6.4 basis points for thrifts per $100 of deposits.  Previously, the
minimum combined SAIF and FICO assessments for thrifts had been 23 basis points.
Although the special one-time assessment significantly increased noninterest
expense for the current year, the anticipated reduction in the premium schedule
will reduce the Association's federal insurance premiums for future periods.

Recent Accounting Developments
------------------------------

SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and Long-Lived
Assets to Be Disposed Of," is effective for the fiscal year beginning October 1,
1996.  The statement requires that long-lived assets and certain identifiable
intangibles to be held and used by an entity be reviewed for impairment whenever
events or changes in circumstances indicate that the carrying amount of an asset
may not be recoverable.  An impairment loss is recognized if the sum of the
expected future cash flow is less than the carrying amount of the asset.
Management does not expect the implementation of SFAS No. 121 to have a material
impact on the Company's consolidated financial position or results of
operations.

SFAS No. 122, "Accounting for Mortgage Servicing Rights," will be effective for
the Company for the year beginning October 1, 1996 and generally requires
entities that sell or securitize loans and retain the mortgage servicing rights
to allocate the total costs of the mortgage loans to the mortgage servicing
right and the loan based on their relative fair value.  Costs allocated to
mortgage servicing rights should be recognized as a separate asset and amortized
over the period of estimated net servicing income and evaluated for impairment
based on fair value.  The adoption of this statement is not expected to have a
material effect on the consolidated financial statements.

SFAS No. 123, "Accounting for Stock-based Compensation," established optional
financial accounting and reporting standards for stock-based employee
compensation plans.  These plans include all arrangements by which employees
receive shares of stock or other equity investments of the employer or the
employer incurs liabilities to employees in amounts based on the price of the
employers stock.  This statement also applies to transactions in which an entity
issues its equity instruments to acquire goods or services from nonemployees.
This statement is effective for fiscal years beginning after December 15, 1995.
The Company does not expect to adopt the optional accounting method.

                                      17
<PAGE>
 
SFAS No. 125, "Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities," supersedes SFAS No. 122 and will be effective
for all transfers and servicing of financial assets and extinguishments of
liabilities occurring after December 31, 1996.  This statement provides
accounting and reporting standards for transfers and servicing of financial
assets and extinguishments of liabilities based on consistent application of a
financial-components approach that focuses on control.  It distinguishes
transfers of financial assets that are sales from transfers that are secured
borrowings.

Under the financial-components approach, after a transfer of financial assets,
an entity recognizes all financial and servicing assets it controls and
liabilities it has incurred and derecognizes financial assets it no longer
controls and liabilities that have been extinguished.  The financial-components
approach focuses on the assets and liabilities that exist after the transfer.
Many of these assets and liabilities are components of financial assets that
existed prior to the transfer.  If a transfer does not meet the criteria for a
sale, the transfer is accounted for as a secured borrowing with pledge of
collateral.  Management does not expect the implementation of SFAS No. 125 to
have a material impact on the Company's consolidated financial position or
results of operations.

Impact of Inflation and Changing Prices
---------------------------------------

The audited Consolidated Financial Statements and Notes thereto presented herein
have been prepared in accordance with generally accepted accounting principles.
These principles generally require the measurement of financial position and
operating results in terms of historical dollars, without considering changes in
the relative purchasing power of money over time due to inflation.

The primary assets and liabilities of the Company and savings institutions such
as the Association are monetary in nature. As a result, interest rates have a
more significant impact on the Association's performance than the effects of
general levels of inflation.  Interest rates, however, do not necessarily move
in the same direction or with the same magnitude as the prices of goods and
services, since such prices are affected by inflation.  In a period of rapidly
rising interest rates, the liquidity and maturity structure of the Association's
assets and liabilities are critical to the maintenance of acceptable performance
levels.

The principal effect of inflation, as distinct from levels of interest rates, on
the Association's earnings is in the area of noninterest expense.  Expense items
such as employee compensation and benefits, occupancy and equipment costs may be
subject to increases as a result of inflation.  An additional effect of
inflation is the possible increase in the dollar value of the collateral
securing loans made by the Association.  The Association is unable to determine
the extent, if any, to which the properties securing its loans have appreciated
in dollar value due to inflation.

                                      18
<PAGE>
 
[LOGO OF KPMG PEAT MARWICK LLP APPEARS HERE]


                         INDEPENDENT AUDITORS' REPORT
                         ----------------------------



The Board of Directors
Cameron Financial Corporation:


We have audited the accompanying consolidated balance sheets of Cameron
Financial Corporation and subsidiary (the Company) as of September 30, 1996 and
1995 and the related consolidated statements of earnings, stockholders' equity
and cash flows for each of the years in the three-year period ended September
30, 1996.  These consolidated financial statements are the responsibility of the
Company's management.  Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Cameron Financial
Corporation and subsidiary as of September 30, 1996 and 1995 and the results of
their operations and their cash flows for each of the years in the three-year
period ended September 30, 1996, in conformity with generally accepted
accounting principles.



                                                           KPMG Peat Marwick LLP


Kansas City, Missouri
November 22, 1996

                                      19
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                          Consolidated Balance Sheets

                          September 30, 1996 and 1995

<TABLE> 
<CAPTION> 
                               Assets                                             1996            1995
                               ------                                             ----            ----
<S>                                                                          <C>              <C> 
Cash and cash equivalents                                                    $   3,783,000       3,315,000
Certificates of deposit in other financial institutions                          2,500,000       8,611,000
Investment securities held-to-maturity (estimated fair value of        
   $18,249,000 in 1996 and $26,497,000 in 1995) (note 3)                        18,297,000      26,473,000
Mortgage-backed securities held-to-maturity                                         13,000          17,000 
Loans receivable, net (notes 4 and 8)                                          154,444,000     129,740,000
Accrued interest receivable:
   Loans and mortgage-backed securities                                          1,090,000         847,000
   Investment securities                                                           206,000         397,000
   Certificates of deposit                                                           --              3,000
Office properties and equipment, net (note 6)                                    2,874,000         699,000
Stock in Federal Home Loan Bank (FHLB) of Des Moines, at cost                    1,259,000       1,235,000
Deferred income taxes (note 9)                                                     611,000         208,000
Other assets (notes 5 and 10)                                                    1,269,000       1,532,000
                                                                               -----------     -----------
                                                                             $ 186,346,000     173,077,000
                                                                               ===========     ===========
<CAPTION> 

                    Liabilities and Stockholders' Equity
                    ------------------------------------

Liabilities
<S>                                                                          <C>              <C> 
   Savings deposits (note 7)                                                 $ 123,108,000     121,280,000
   Borrowings from the FHLB (note 8)                                            12,250,000         --
   Advance payments by borrowers for property taxes and insurance                1,729,000       1,628,000
   Accrued interest payable on savings deposits                                    141,000         155,000
   Accrued expense and other liabilities                                         1,989,000         997,000
   Current income taxes payable                                                    314,000         290,000
                                                                               -----------     -----------
             Total liabilities                                                 139,531,000     124,350,000   
                                                                               -----------     -----------
Stockholders' equity (notes 1 and 2):
   Serial preferred stock, $0.1 par; 2,000,000 shares authorized;
     none issued or outstanding                                                   --               --
   Common stock, $.01 par; 10,000,000 shares authorized;
     3,026,928 shares issued                                                        30,000          30,000
   Additional paid-in-capital                                                   29,622,000      29,476,000  
   Retained earnings, substantially restricted (note 9)                         22,756,000      21,398,000
   Unearned employee benefits (note 10)                                         (3,082,000)     (2,177,000)
   Treasury stock; 177,248 shares of common stock at cost                       (2,511,000)        --
                                                                               -----------     -----------
             Total stockholders' equity                                         46,815,000      48,727,000
                                                                             
Commitments (notes 4 and 12)                                                   -----------     -----------
                                                                             $ 186,346,000     173,077,000 
                                                                               ===========     ===========
</TABLE>            


See accompanying notes to consolidated financial statements.



                                      20
<PAGE>
 

                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                      Consolidated Statements of Earnings

                           Years ended September 30


<TABLE> 
<CAPTION> 
                                                                           1996           1995           1994
                                                                           ----           ----           ----
<S>                                                                 <C>              <C>            <C>  
Interest income:
    Loans                                                            $ 12,181,000     10,472,000      9,339,000
    Investment securities                                               1,319,000      1,190,000        724,000
    Mortgage-backed securities                                              2,000          2,000          2,000
    Certificates of deposit and other                                     419,000        625,000        597,000
                                                                       ----------     ----------     ----------
                Total interest income                                  13,921,000     12,289,000     10,662,000
                                                                       ----------     ----------     ----------
Interest expense:
    Savings deposits (note 7)                                           6,492,000      6,298,000      5,710,000
    Borrowed money                                                        187,000         19,000          -
                                                                       ----------     ----------     ----------
                Total interest expense                                  6,679,000      6,317,000      5,710,000
                                                                       ----------     ----------     ----------

                Net interest income                                     7,242,000      5,972,000      4,952,000

Provision for loan losses (note 4)                                        368,000        120,000        252,000
                                                                       ----------     ----------     ----------
                Net interest income after provision for loan losses     6,874,000      5,852,000      4,700,000
                                                                       ----------     ----------     ----------
 
Noninterest income:
    Loan and deposit service charges                                      130,000        131,000        136,000
    (Loss) gain on sale of investment securities                            -             (4,000)         7,000
    Other income                                                           92,000        100,000         43,000
                                                                       ----------     ----------     ----------
                Total noninterest income                                  222,000        227,000        186,000
                                                                       ----------     ----------     ----------
Noninterest expense:
    Compensation, payroll taxes and fringe benefits (note 10)           1,665,000      1,445,000      1,375,000
    Occupancy expense                                                     209,000        187,000        160,000
    Data processing                                                       151,000        129,000        120,000
    Federal deposit insurance premiums (note 11)                        1,082,000        283,000        282,000
    Advertising                                                            81,000         67,000         56,000
    Loss (income) on real estate owned, net                                (1,000)         2,000         (6,000)
    Other operating expenses                                              585,000        390,000        456,000
                                                                       ----------     ----------     ----------
                 Total noninterest expense                              3,772,000      2,503,000      2,443,000
                                                                       ----------     ----------     ----------

                 Earnings before income taxes                           3,324,000      3,576,000      2,443,000
                      
Income taxes (note 8)                                                   1,214,000      1,272,000        894,000
                                                                       ----------     ----------     ----------
                 Net earnings                                        $  2,110,000      2,304,000      1,549,000
                                                                       ==========     ==========     ==========

Net earnings per share (note 2)                                      $       0.77           0.83          -
                                                                       ==========     ==========     ==========

Average common shares outstanding                                    $  2,740,759      2,784,906          -
                                                                       ==========     ==========     ==========
</TABLE> 


See accompanying notes to consolidated financial statements.



                                      21


<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                Consolidated Statements of Stockholders' Equity

                           Years ended September 30

<TABLE> 
<CAPTION> 
                                                                                                                       Net
                                                                                  Additional                     unrealized loss
                                                                     Common         paid-in         Retained      on marketable
                                                                      stock         capital         earnings    equity securities
                                                                      -----         -------         --------    -----------------
<S>                                                                <C>            <C>             <C>           <C> 
Balance at September 30, 1993                                      $    --             --          17,742,000          (2,000)    
Net earnings                                                            --             --           1,549,000            --       
Change in gain (loss) on marketable equity securities                   --             --              --             (22,000)    
                                                                     -------      -----------     -----------     -----------
Balance at September 30, 1994                                           --             --          19,291,000         (24,000)    
October 1, 1994 adoption of SFAS No. 115                                --             --              --              24,000    
Sale of common stock, net of offering cost of $821,000                30,000       29,418,000          --                --       
Unearned ESOP shares                                                    --             --              --                --       
Net earnings                                                            --             --           2,304,000            --
Dividend declared ($.07 per share)                                      --             --            (197,000)           --
Allocation of ESOP shares                                               --             58,000          --                --
Change in gain (loss) on available for sale securities                  --             --              --                --
                                                                     -------      -----------     -----------     -----------
Balance at September 30, 1995                                         30,000       29,476,000      21,398,000            --
January 29, 1996 adoption of Recognition and                                                                 
  Retention Plan (RRP) (note 10)                                       1,000        1,398,000          --                --
Amortization of RRP, net of forfeitures                                 --             --              --                --
Net earnings                                                            --             --           2,110,000            --
Dividend declared ($.28) per share)                                     --             --            (752,000)           --
Allocation of ESOP shares                                               --            124,000          --                --
Purchase of treasury stock                                              --             --              --                --
Retirement of treasury stock                                          (1,000)      (1,376,000)         --                --
                                                                     -------      -----------     -----------     -----------
Balance at September 30, 1996                                      $  30,000       29,622,000      22,756,000            --
                                                                     =======      ===========     ===========     ===========
                                                                                                              
<CAPTION>                                                                                                     

                                                                    Net gain
                                                                   (loss) on        Unearned 
                                                                 available-for-     employee       Treasury
                                                                 sale securities    benefits         stock           Total
                                                                 ---------------    --------       --------          -----
<S>                                                                <C>            <C>             <C>           <C> 
Balance at September 30, 1993                                      $    --             --              --          17,740,000   
Net earnings                                                            --             --              --           1,549,000     
Change in gain (loss) on marketable equity securities                   --             --              --             (22,000)    
                                                                     -------      -----------     -----------     -----------
Balance at September 30, 1994                                           --             --              --          19,267,000     
October 1, 1994 adoption of SFAS No. 115                               2,000           --              --              26,000    
Sale of common stock, net of offering cost of $821,000                  --             --              --          29,448,000     
Unearned ESOP shares                                                    --         (2,422,000)         --          (2,422,000)    
Net earnings                                                            --             --              --           2,304,000
Dividend declared ($.07 per share)                                      --             --              --            (197,000)
Allocation of ESOP shares                                               --            245,000          --             303,000
Change in gain (loss) on available for sale securities                (2,000)          --              --              (2,000)
                                                                     -------      -----------     -----------     -----------
Balance at September 30, 1995                                           --         (2,177,000)         --          48,727,000
January 29, 1996 adoption of Recognition and                                                                 
  Retention Plan (RRP) (note 10)                                        --         (1,399,000)                
Amortization of RRP, net of forfeitures                                 --            193,000          (7,000)        186,000
Net earnings                                                            --             --              --           2,110,000
Dividend declared ($.28) per share)                                     --             --              --            (752,000)
Allocation of ESOP shares                                               --            301,000          --             425,000
Purchase of treasury stock                                              --             --          (3,881,000)     (3,881,000)
Retirement of treasury stock                                            --             --           1,377,000            --
                                                                     -------      -----------     -----------     -----------
Balance at September 30, 1996                                      $    --         (3,082,000)     (2,511,000)     46,815,000
                                                                     =======      ===========     ===========     ===========
</TABLE> 

See accompanying notes to consolidated financial statements.


                                      22
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                    Consolidated Statements of Cash Flows 

                           Years ended September 30

<TABLE> 
<CAPTION>                                                            1996           1995           1994
                                                                     ----           ----           ----
<S>                                                            <C>                 <C>            <C>   
Cash flows from operating activities:          
   Net earnings                                                $    2,110,000      2,304,000      1,549,000
   Adjustments to reconcile net earnings to cash 
      provided by operating activities:                           
         Depreciation and amortization                                 50,000          7,000         50,000
         Provision for loan losses                                    368,000        120,000        252,000
         Provision for losses on real estate owned                     -              -               1,000
         Amortization of RRP and allocation of ESOP shares            611,000        303,000         -
         Deferred income taxes                                       (403,000)        64,000       (183,000)
         (Gain) loss on sales of real estate owned                     (3,000)         1,000        (22,000)
         Loss on sale of fixed assets                                  -               1,000         -
         Loss (gain) on sales of investment securities                 -               4,000         (7,000)
         Stock dividend received on FHLB stock                        (24,000)        -              -
         Amortization of deferred loan fees                          (397,000)      (321,000)      (275,000)
         Proceeds from sales of loans held for sale                 1,549,000      1,121,000      2,574,000
         Origination of loans held for sale                        (1,450,000)    (1,184,000)    (2,556,000)
         Gain on sale of loans held for sale                          (17,000)       (19,000)       (18,000)
         Changes in assets and liabilities:
            Accrued interest receivable                               (49,000)      (307,000)       (72,000)
            Other assets                                              333,000       (118,000)       (15,000)
            Accrued interest payable                                  (14,000)        29,000         13,000
            Accrued expenses and other liabilities                  1,003,000        118,000        287,000  
            Current income taxes payable                               24,000        133,000        (37,000)
                                                                   ----------     ----------    ----------- 
                Cash provided by operating activities               3,691,000      2,256,000      1,541,000
                                                                   ----------     ----------    -----------

Cash flows from investing activities:
   Net increase in loans receivable                               (23,938,000)   (15,451,000)    (3,431,000)  
   Purchase of loans receivable                                      (882,000)       (26,000)      (373,000)
   Mortgage-backed securities principal repayments                      4,000          3,000          9,000
   Maturities of investment securities held-to-maturity            12,751,000      2,560,000      2,555,000
   Purchase of investment securities held-to-maturity              (4,541,000)   (14,528,000)    (7,088,000)
   Proceeds from sale of investment securities 
    available-for-sale                                                 -           1,870,000         -
   Proceeds from the sale of marketable equity securities              -              -              57,000
   Net decrease in certificates of deposit in other 
    financial institutions                                            991,000      5,050,000        894,000
   Net proceeds from sales of real estate owned                         2,000         -             227,000
   Purchase of life insurance policies                                 -          (1,270,000)        -
   Additions and improvements to real estate owned                     (7,000)        -             (76,000)
   Purchase of office properties and equipment                     (2,259,000)      (126,000)      (462,000)      
                                                                   ----------     ----------    ----------- 
                Net cash used in investing activities          $  (17,879,000)   (21,918,000)    (7,688,000)   
                                                                   ----------     ----------    ----------- 
   
                                                                                                 (Continued)

                                                     23
</TABLE> 
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

               Consolidated Statements of Cash Flows, Continued


<TABLE> 
<CAPTION>                                                                                
                                                                               1996                1995                1994
Cash flows from financing activities:                                          ----                ----                ----
<S>                                                                    <C>                     <C>                 <C> 
   Proceeds from sale of common stock, net of costs of issuance        $       -               27,026,000              -      
   Net increase (decrease) in NOW, passbook and money market                  
     demand amounts                                                           139,000          (7,864,000)         (1,090,000)   
   Net increase in certificate accounts                                     1,689,000           6,034,000           1,822,000  
   Net increase (decrease) in advance payments by borrowers                         
     for taxes and insurance                                                  101,000             149,000             (36,000)     
   Proceeds from Federal Home Loan Bank advances                           12,250,000           2,500,000              - 
   Repayment of Federal Home Loan Bank advances                                -               (2,500,000)             -      
   Dividends paid                                                            (762,000)             -                   -
   Purchase of treasury stock                                              (3,881,000)             -                   -
                                                                          -----------          ----------          ----------
             Net cash provided by financing activities                      9,536,000          25,345,000             696,000
                                                                          -----------          ----------          ----------

             Net (decrease) increase in cash                               (4,652,000)          5,683,000          (5,451,000) 

Cash and cash equivalents at beginning of year                             10,935,000           5,525,000          10,703,000    
                                                                          -----------          ----------          ----------
Cash and cash equivalents at end of year                               $    6,283,000          10,935,000           5,252,000
                                                                          -----------          ----------          ----------
Supplemental disclosure of cash flow information:
   Cash paid during the year for income taxes                          $    1,594,000           1,061,000           1,114,000
                                                                          -----------          ----------          ----------
   Cash paid during the year for interest                              $    6,505,000           6,268,000           5,697,000  
                                                                          -----------          ----------          ----------
Supplemental schedule of noncash investing and financing activities:   
   Conversion of loans to real estate owned                            $      121,000              63,000             127,000  
                                                                          -----------          ----------          ----------
   Conversion of real estate owned to loans                            $       59,000              63,000             257,000 
                                                                          -----------          ----------          ----------
   Dividends declared and payable                                      $      186,000             197,000              -   
                                                                          -----------          ----------          ----------
   Issuance of unearned ESOP                                           $       -                2,422,000              -
                                                                          -----------          ----------          ----------
   Issuance of unearned RRP shares                                     $    1,399,000              -                   -
                                                                          -----------          ----------          ----------
</TABLE> 
See accompanying notes to consolidated financial statements.

                                      24 
                                                      
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements

                          September 30, 1996 and 1995


(1)  Conversion and Acquisition of the Association by the Company
     ------------------------------------------------------------

     Cameron Financial Corporation (the Company) was incorporated in December
          1994 for the purpose of becoming the savings and loan holding company
          of The Cameron Savings & Loan Association, F.A. (the Association) in
          connection with the Association's conversion from a federally
          chartered mutual savings and loan to a federally chartered stock
          savings and loan. Pursuant to its Plan of Conversion, on March 31,
          1995, the Company issued and sold 3,026,928 shares of its common
          stock, in a subscription and community offering to the Association's
          depositors and borrowers, the Company's employee stock ownership plan,
          and the general public. Total proceeds of the offering, net of costs
          and funding the ESOP, were approximately $27,026,000. The Company
          utilized $14,724,000 of the net proceeds to acquire all of the common
          stock issued by the Association in connection with its conversion. The
          remaining proceeds were retained by the Company and invested in
          government and agency securities.
          
     The acquisition of the Association by the Company was accounted for in a
          manner similar to the pooling-of-interests method. Accordingly, the
          accounting basis of the assets, liabilities and equity accounts of the
          Association remained the same as prior to the conversion and
          acquisition and were not adjusted to their fair values, and no
          purchase accounting adjustments were recorded. All intercompany
          accounts and transactions are eliminated in consolidation.

     In order to grant priority to eligible account holders in the event of
          future liquidation, the Association, at the time of conversion
          established a liquidation account in the amount equal to the
          Association's capital as of September 30, 1994 ($19,291,000). In the
          event of the future liquidation of the Association, eligible account
          holders and supplemental eligible account holders who continue to
          maintain their deposit accounts shall be entitled to receive a
          distribution from the liquidation account. The total amount of the
          liquidation account will be decreased as the balance of the eligible
          account holders and supplemental eligible account holders is reduced
          subsequent to the conversion, based on an annual determination of such
          balances. The Association may not declare or pay a cash dividend to
          the Company on, or repurchase any of its common stock if the effect
          thereof would cause the retained earnings of the Association to be
          reduced below the amount required for the liquidation account. Except
          for such restrictions, the existence of the liquidation account does
          not restrict the use or application of the Association's retained
          earnings.

                                                                     (Continued)

                                      25
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


(2)  Summary of Significant Accounting Policies
     ------------------------------------------

     (a) Cash and Cash Equivalents
         -------------------------

     For purposes of the statements of cash flows, all short-term investments
          with a maturity of three months or less at date of purchase are
          considered cash equivalents. Cash and cash equivalents reflected on
          the balance sheet include interest earning deposits of $3,333,000 and
          $3,082,000 at September 30, 1996 and 1995, respectively.

     (b)  Investment Securities
          ---------------------

     The Company and the Association classify their investment securities as
          held-to-maturity, available-for-sale or trading. Held-to-maturity
          securities are recorded at amortized cost adjusted for amortization of
          premiums and accretion of discounts that are recognized in income
          using the interest method over the period to maturity. Available-for-
          sale and trading securities are recorded at fair value. Adjustments to
          record available-for-sale securities at fair value are reflected, net
          of tax, in equity. At September 30, 1996 and 1995, all of the
          Company's and Association's investment and mortgage-backed securities
          are classified as held-to-maturity.

     Gain or loss on the sale of securities is recognized using the specific
          identification method.

     (c) Provisions for Losses on Loans and Interest Receivable
         ------------------------------------------------------

     Provision for losses on loans receivable are based upon management's
          estimate of the amount required to maintain an adequate allowance for
          losses, relative to the risks in the loan portfolio. The estimate is
          based on reviews of the portfolio, including assessment of the
          carrying value of the loans to the estimated net realizable value of
          the related underlying collateral, considering past loss experience,
          current economic conditions and such other factors which, in the
          opinion of management, deserve current recognition. The Association is
          subject to the regulations of certain federal agencies and undergoes
          periodic examinations by those regulatory authorities. As an integral
          part of those examinations, the various regulatory agencies
          periodically review the Association's allowance for loan losses. Such
          agencies may require the Association to recognize changes to the
          allowance based on their judgments about information available to them
          at the time of their examination.

     Accrual of interest income on loans is discontinued for those loans with
          interest more than ninety days delinquent or sooner if management
          believes collectibility of the interest is not probable. Management's
          assessment of collectibility is primarily based on a comparison of the
          estimated value of underlying collateral to the related loan and
          accrued interest receivable balances.

                                                                     (Continued)

                                      26
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


     The Association adopted Statements of Financial Accounting Standards (SFAS)
          No. 114, "Accounting by Creditors for Impairment of a Loan," and SFAS
          No. 118, "Accounting by Creditors for Impairment of a Loan - Income
          Recognition and Disclosures," on October 1, 1995. SFAS No. 114, as
          amended by SFAS No. 118, defines the recognition criteria for loan
          impairment and the measurement methods for certain impaired loans and
          loans for which terms have been modified in troubled-debt
          restructurings (a restructured loan). Specifically, a loan is
          considered impaired when it is probable a creditor will be unable to
          collect all amounts due - both principal and interest - according to
          the contractual terms of the loan agreement. When measuring
          impairment, the expected future cash flows of an impaired loan are
          required to be discounted at the loan's effective interest rate.
          Alternatively, impairment can be measured by reference to an
          observable market price, if one exists, or the fair value of the
          collateral for a collateral-dependent loan. Regardless of the
          historical measurement method used, SFAS No. 114 requires a creditor
          to measure impairment based on the fair value of the collateral when
          the creditor determines foreclosure is probable. Additionally,
          impairment of a restructured loan is measured by discounting the total
          expected future cash flows at the loan's effective rate of interest as
          stated in the original loan agreement.

     The Association applies the recognition criteria of SFAS No. 114 to
          multifamily real estate loans, commercial real estate loans and
          restructured loans. Smaller balance, homogeneous loans, including one-
          to-four-family residential and construction loans and consumer loans,
          are collectively evaluated for impairment. SFAS No. 118 amended SFAS
          No. 114 to allow a creditor to use existing methods for recognizing
          interest income on impaired loans. The Association has elected to
          continue to use its existing nonaccrual methods for recognizing
          interest on impaired loans. The adoption of SFAS No. 114 and SFAS No.
          118 resulted in no adjustment to the allowance for loan losses and did
          not affect the Association's policies regarding charge-offs or
          recoveries.

     (d)  Deferred Loan Fees and Costs
          ----------------------------

     Mortgage loan origination fees and direct mortgage loan origination costs
          are deferred and the net fee or cost is recognized in earnings using
          the interest method over the contractual life of the loan. Direct loan
          origination costs for other loans are expensed, as such costs are not
          material in amount.

     (e)  Loans Held for Sale
          -------------------

     Mortgage loans originated and intended for sale in the secondary market are
          carried at the lower of cost or fair value. Net unrealized losses are
          recognized through a valuation allowance by charges to income. At
          September 30, 1996, there were no loans held for sale. At September
          30, 1995, loans held for sale totaled $82,000. There was no valuation
          allowance at September 30, 1995.

                                                                     (Continued)

                                      27
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


     (f)  Real Estate Owned
          -----------------

     Real estate owned includes real estate acquired through, or in lieu of,
          loan foreclosure and is carried at the lower of cost or estimated fair
          value less estimated cost to sell. Revenue and expenses from
          operations and the provision for losses on real estate owned are
          included in income (loss) on real estate owned in the accompanying
          consolidated statements of earnings.

     (g)  Office Properties and Equipment
          -------------------------------

     Office properties and equipment are recorded at cost, less accumulated
          depreciation. Depreciation is provided on office properties and
          equipment using the straight-line method over the estimated useful
          lives of the related assets.

     (h)  Stock in Federal Home Loan Bank (FHLB)
          --------------------------------------

     The Association is a member of the FHLB system.  As a member, the
          Association is required to purchase and hold stock in the FHLB of Des
          Moines in an amount equal to the greater of (a) 1% of unpaid
          residential loans at the beginning of each year, (b) 5% of FHLB
          advances, or (c) .3% of total assets. The Association's investment in
          such stock is recorded at cost.

     (i)  Income Taxes
          ------------

     Deferred tax assets and liabilities are recognized for the future tax
          consequences attributable to the difference between the financial
          statement carrying amounts of existing assets and liabilities and
          their respective tax bases. Deferred tax assets and liabilities are
          measured using enacted tax rates expected to apply to taxable income
          in the years in which those temporary differences are expected to be
          recovered or settled. The effect on deferred tax assets and
          liabilities of a change in tax rates is recognized in income in the
          period that includes the enactment date.

     (j)  Earnings Per Share
          ------------------

     Earnings per share is based upon the weighted average common and common
          equivalent shares outstanding, less treasury shares and unallocated
          ESOP shares. Stock options and the shares awarded under the RRP (see
          note 10) are regarded as common stock equivalents and are therefore
          considered in both primary and fully diluted earnings per share
          calculations. Common stock equivalents are computed using the treasury
          stock method.

     For 1995, earnings per share is based upon the total number of common
          shares outstanding after the conversion and acquisition described
          above and are presented as if those shares had been outstanding for
          the entire year. The 1995 computation does not reflect the pro forma
          effect of any investment income that would have been earned if the net
          proceeds from conversion had been received at the beginning of the
          year.

                                                                     (Continued)

                                      28
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


     (k)  Use of Estimates
          ----------------

     Management of the Association has made a number of estimates and
          assumptions relating to the reporting of assets and liabilities and
          the disclosure of contingent assets and liabilities to prepare these
          consolidated financial statements in conformity with generally
          accepted accounting principles. Actual results could differ from those
          estimates.

     (l)  New Account Pronouncements
          --------------------------

     SFAS No. 122, "Accounting for Mortgage Servicing Rights," will be adopted
          October 1, 1996 and generally requires entities that sell or
          securitize loans and retain the mortgage servicing rights to allocate
          the total cost of the mortgage loans to the mortgage servicing rights
          and the loan based on their relative fair value. Costs allocated to
          mortgage servicing rights should be recognized as a separate asset and
          amortized over the period of estimated net servicing income and
          evaluated for impairment based on fair value.

     SFAS No. 123, "Accounting for Stock-Based Compensation," will be adopted by
          the Company during the fiscal year ending September 30, 1997. This
          statement establishes financial accounting and reporting standards for
          stock-based employee compensation plans. These plans include all
          arrangements by which employees receive shares of stock or other
          equity investments of the employer or the employer incurs liabilities
          to employees in amounts based on the price of the employer's stock.
          This statement also applies to transactions in which an entity issues
          its equity instruments to acquire goods and services from
          nonemployees.

     SFAS No. 125, "Accounting for Transfers and Servicing of Financial Assets
          and Extinguishments of Liabilities," supersedes SFAS No. 122 and will
          be effective for all transfers and servicing of financial assets and
          extinguishments of liabilities occurring after December 31, 1996. This
          statement provides accounting and reporting standards for transfers
          and servicing of financial assets and extinguishments of liabilities
          based on consistent application of a financial-components approach
          that focuses on control. It distinguishes transfers of financial
          assets that are sales from transfers that are secured borrowings.

     Under the financial-components approach, after a transfer of financial
          assets, an entity recognizes all financial and servicing assets it
          controls and liabilities it has incurred and derecognizes financial
          assets it no longer controls and liabilities that have been
          extinguished. The financial-components approach focuses on the assets
          and liabilities that exist after the transfer. Many of these assets
          and liabilities are components of financial assets that existed prior
          to the transfer. If a transfer does not meet the criteria for a sale,
          the transfer is accounted for as a secured borrowing with pledge of
          collateral.

     Management believes adoption of SFAS Nos. 122, 123 and 125  will not have a
          material effect on the financial position or results of operations,
          nor will adoption require additional capital resources.

                                                                     (Continued)

                                      29
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements
 

(3)  Investment Securities
     ---------------------

     A summary, by maturity dates, of investment securities held-to-maturity at
     September 30, 1996 follows:
<TABLE>
<CAPTION>
 
                                                                   Gross                Gross           Estimated
                                                 Amortized       unrealized           unrealized           fair
                                                    cost            gains               losses             value
                                                    ----            -----               ------             -----    
<S>                                         <C>                <C>                    <C>            <C>
United States government and agency
   obligations maturing in less than 
   one year                                  $   3,988,000          16,000                (1,000)       4,003,000
United States government and agency
   obligations maturing after one year          12,194,000          41,000              (122,000)      12,113,000
   but within five years
United States government and agency
   obligations maturing after five
   years but within ten years                      500,000               -                (4,000)         496,000
                                                ----------        --------              --------       ---------- 
                                                16,682,000          57,000              (127,000)      16,612,000
                                                ----------        --------              --------       ---------- 
 
Privately issued bonds maturing in:
   2001                                            615,000          41,000                     -          656,000
   2005                                          1,000,000               -               (19,000)         981,000
                                                ----------        --------              --------       ---------- 
                                                 1,615,000          41,000               (19,000)       1,637,000
                                                ----------        --------              --------       ---------- 
          Total                              $  18,297,000      $   98,000              (146,000)      18,249,000
                                                ==========        ========              ========       ========== 

</TABLE> 
 
       A summary, by maturity dates, of investment securities held-to-maturity
          at September 30, 1995 follows:

<TABLE>
<CAPTION>
 
                                                                   Gross                Gross           Estimated
                                                 Amortized       unrealized           unrealized           fair
                                                    cost            gains               losses             value
                                                    ----            -----               ------             -----    
<S>                                         <C>                <C>                    <C>            <C>
United States government and agency
   obligations maturing in less than
   one year                                  $   7,389,000          10,000               (23,000)       7,376,000
United States government and agency
   obligations maturing after one year
   but within five years                        17,867,000         152,000              (132,000)      17,887,000
United States government and agency
   obligations maturing after five
   years but within ten years                      500,000               -                (2,000)         498,000
                                                ----------        --------              --------       ---------- 
                                                25,756,000         162,000              (157,000)      25,761,000
                                                ----------        --------              --------       ---------- 
 
Privately issued bonds maturing in:
   1996                                            103,000               -                     -          103,000
   2001                                            614,000          19,000                     -          633,000
                                                ----------        --------              --------       ---------- 
                                                   717,000          19,000                     -          736,000
                                                ----------        --------              --------       ---------- 
          Total                              $  26,473,000      $  181,000              (157,000)      26,497,000
                                                ==========        ========              ========       ========== 
</TABLE>
                                                                     (Continued)

                                      30
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


     Proceeds from the sale of investment securities for the years ended
          September 30, 1995 and 1994 totaled $1,870,000 and $57,000,
          respectively, and resulted in gross realized losses of $53,000 and $0
          and gross realized gains of $49,000 and $7,000, respectively. There
          were no sales of investment securities in the year ended September 30,
          1996.
 
(4)  Loans Receivable
     ----------------

     Loans receivable at September 30 are summarized as follows:
<TABLE>
<CAPTION>
 
                                                          1996            1995
                                                          ----            ----    
          <S>                                         <C>               <C>
          Residential real estate loans:
             One to four family                       $109,292,000     94,958,000
             Multifamily                                 2,908,000      3,181,000
             Held for sale                                       -         82,000
          Construction loans, primarily             
             single family                              41,646,000     32,956,000
          Land                                           9,605,000      4,106,000
          Commercial real estate                         4,322,000      3,759,000
          Consumer loans                                 8,330,000      5,587,000
                                                      ------------    -----------
                  Total loans receivable               176,103,000    144,629,000
 
          Less:
             Loans in process                           19,502,000     13,253,000
             Deferred loans fees, net                      804,000        642,000
             Allowance for loan losses                   1,353,000        994,000
                                                      ------------    -----------
                                                      $154,444,000    129,740,000
                                                      ============    ===========
</TABLE>

     The Association grants residential and commercial real estate, and other
          consumer and commercial loans primarily in its lending territory,
          Clinton County, Missouri and contiguous counties. Although the
          Association has a diversified loan portfolio, a substantial portion of
          its borrowers' ability to repay their loans is dependent upon economic
          conditions in the Association's lending territory.

     The Association makes contractual commitments to extend credit which are
          subject to the Association's credit monitoring procedures. At
          September 30, 1996, the Association was committed to originate loans
          receivable aggregating approximately $6,693,000, including fixed-rate
          loan commitments of approximately $3,385,000, with interest rates
          ranging from 7.375% to 8.750%. At September 30, 1996, commitments to
          sell loans were $140,000. There were no commitments to buy loans.

     At September 30, 1996 and 1995, the Association had loans of $715,000 and
          $946,000, respectively, to various directors, officers and their
          families.  During 1996, $222,000 of new loans were made and repayments
          totaled $453,000.  These loans are made subject to the same interest
          rates and underwriting standards used to originate loans to other
          borrowers of the Association.

                                                                     (Continued)


                                      31
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


     The following is a summary of activity in the allowance for loan losses for
          the years ended September 30:
<TABLE>
<CAPTION>
 
                                             1996           1995        1994
                                             ----           ----        ----  
      <S>                              <C>                 <C>         <C>
      Balance at beginning of year       $  994,000        876,000     637,000
      Provision for loan losses             368,000        120,000     252,000
      Charge-offs                            (9,000)        (2,000)    (13,000)
                                         ----------        -------     -------
      Balance at end of year             $1,353,000        994,000     876,000
                                         ==========        =======     =======
</TABLE>

     Loans delinquent ninety days or more at September 30, 1996 and 1995 were
          approximately $1,478,000 and $1,335,000, respectively, including
          nonaccrual loans of approximately $769,000 and $560,000, respectively.
          Interest that would have been recognized on nonaccrual loans under
          their original terms but for which an allowance has been established
          amounted to $40,000 and $15,000 at September 30, 1996 and 1995,
          respectively. The amount that was included in income on such loans was
          $40,000 and $19,000 for the years ended September 30, 1996 and 1995,
          respectively.

(5)  Real Estate Owned
     -----------------

     At September 30, 1996  the Association had $70,000 in real estate owned
          included in other assets in the accompanying balance sheet. At
          September 30, 1995, the Association had no real estate owned.

(6)  Office Properties and Equipment
     -------------------------------

     At September 30, 1996 and 1995, office properties and equipment consisted
          of the following:
<TABLE>
<CAPTION>
 
                                                  1996        1995
                                                  ----        ----  
      <S>                                    <C>             <C>
      Land                                   $  428,000      428,000
      Buildings and improvements                127,000      129,000
      Furniture, fixtures and equipment         427,000      263,000
      Construction in progress                2,105,000       54,000
                                             ----------      -------
                                              3,087,000      874,000
                                                          
      Less accumulated depreciation             213,000      175,000
                                             ----------      -------
                                              2,874,000      699,000
                                             ==========      =======
</TABLE>

     The Association is in the process of constructing its new home office
          building in Cameron, Missouri. Total project costs of the new building
          is expected to be $4,250,000 with completion expected in March 1997.
          In November 1996, the Association commenced a plan to purchase a
          parcel of land for $850,000 in Liberty, Missouri for the purpose of
          building a branch location and development and sale of the adjoining
          lots. It is expected that the construction costs of the new branch
          will be $1,000,000 with completion expected in December 1997. The
          Association plans to fund the purchase and the construction of both
          facilities with existing short-term investment securities and cash
          provided from operations.

                                                                     (Continued)

                                      32
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements
 

(7)  Savings Deposits
     ----------------

     Savings deposits at September 30, 1996 and 1995 are summarized as follows:
<TABLE>
<CAPTION>
 
                                                                  1996                            1995
                                                          --------------------           ---------------------
                                       rate               Amount       Percent           Amount        Percent
                                       ----               ------       -------           ------        ------- 
<S>                                <C>              <C>               <C>         <C>                   <C>  
Balance by interest rate:
 NOW and super
   NOW accounts                         0-2.75%        $  5,294,000        4.3%        $  5,322,000        4.4%
 Passbook accounts                        3.25           11,179,000        9.1           10,415,000        8.6
 Money market
   demand accounts                        3.00            7,494,000        6.1            8,091,000        6.7
                                                        -----------      -----          -----------      -----
                                                         23,967,000       19.5           23,828,000       19.7
                                                        -----------      -----          -----------      -----
 
 Certificate accounts                   0-3.99%               4,000       -   %              52,000          -
                                     4.00-4.99            1,280,000        1.0            4,884,000        4.0
                                     5.00-5.99           62,586,000       50.8           47,885,000       39.5
                                     6.00-6.99           25,793,000       21.0           30,714,000       25.3
                                     7.00-7.99            7,389,000        6.0           11,651,000        9.6
                                     8.00-8.99            1,923,000        1.6            2,106,000        1.8
                                          9.00              166,000         .1              160,000         .1
                                                        -----------      -----          -----------      -----
                                                         99,141,000       80.5           97,452,000       80.3
                                                        -----------      -----          -----------      -----
                                                       $123,108,000      100.0%        $121,280,000      100.0%
                                                        ===========      =====          ===========      =====
 
Weighted average interest rate on
 savings deposits at September 30                                   5.33%                           5.41%
                                                                    ====                            ====
 
                                                                  1996                            1995
                                                          --------------------           ---------------------
                                                          Amount       Percent           Amount        Percent
                                                          ------       -------           ------        ------- 
<S>                                                     <C>               <C>         <C>                   <C>   
Contractual maturity of
 certificate accounts:
   Under 12 months                                      $49,547,000       50.0%         $54,348,000       55.8%
   12 to 24 months                                       18,131,000       18.3           13,534,000       13.9
   24 to 36 months                                        6,383,000        6.4            7,729,000        7.9
   36 to 48 months                                        4,506,000        4.5            4,766,000        4.9
   48 to 60 months                                        2,851,000        2.9            4,036,000        4.1
   Over 60 months                                        17,723,000       17.9           13,039,000       13.4
                                                        -----------      -----          -----------      -----
                                                        $99,141,000      100.0%         $97,452,000      100.0%
                                                        ===========      =====          ===========      =====
</TABLE>
                                                                     (Continued)


                                      33
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


     The components of interest expense on savings deposits are as follows for
          the years ended September 30:
<TABLE>
<CAPTION>
 
                                        1996          1995         1994
                                        ----          ----         ----   
<S>                                 <C>             <C>          <C>
NOW, super NOW, passbook and
 money market                       $    691,000      844,000    1,027,000
Certificate accounts                   5,801,000    5,454,000    4,683,000
                                      ----------    ---------    ---------
                                    $  6,492,000    6,298,000    5,710,000
                                      ==========    =========    =========
</TABLE>

     The aggregate amount of certificates of deposit with a minimum denomination
          of $100,000 was approximately $9,119,000 and $7,524,000 at
          September 30, 1996 and 1995, respectively. The amount by which
          individual certificates of deposit exceed $100,000 are not insured by
          the Federal Deposit Insurance Corporation. The Association has pledged
          investment securities with an amortized cost of approximately
          $3,170,000 and $2,920,000 at September 30, 1996 and 1995,
          respectively, as additional security on savings deposits.
 
(8)  FHLB Advances
     -------------

     The Association had the following debt outstanding from the Federal Home
          Loan Bank of Des Moines at September 30, 1996:
<TABLE>
 
      <S>                                           <C>
    $2,000,000 advance, interest at 5.64%,    
           due November 1996                          $ 2,000,000
    $1,000,000 advance, interest at 6.18%,    
           due July 1997                                1,000,000
    $2,000,000 advance, interest at 5.49%,    
           due February 1998                            2,000,000
    $2,000,000 advance, interest at 6.21%,    
           due September 1998                           2,000,000
    $1,000,000 advance, interest at 6.75%,    
           due July 1999                                1,000,000
    $2,000,000 advance, interest at 6.4%,     
           due September 1999                           2,000,000
    $1,250,000 advance, interest at 5.79%,    
           due December 2000                            1,250,000
    $1,000,000 advance, interest at 7.01%,    
           due July 2001                                1,000,000
                                                      -----------
                                                      $12,250,000
                                                      ===========
</TABLE>
     The advances to the FHLB are collateralized by first mortgage loans.

                                                                     (Continued)

                                      34
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


     Scheduled maturities of FHLB advances are as follows:
<TABLE>
<CAPTION>
 
                             Year ending
                            September 30,
                            -------------
                            <S>               <C>             
                                1997          $ 3,000,000
                                1998            4,000,000
                                1999            3,000,000
                                2000                -
                                2001            2,250,000
                                              -----------
                                              $12,250,000
                                              ===========
</TABLE> 
 
(9)  Income Taxes
     ------------
 
     The components of income tax expense are as follows:
<TABLE> 
<CAPTION> 
                                                     Federal          State           Total
                                                     -------          -----           -----
<S>                                              <C>                 <C>            <C> 
Year ended September 30, 1996:                      
 Current                                         $  1,440,000           177,000     1,617,000
 Deferred                                            (351,000)          (52,000)     (403,000)
                                                    ---------       -----------     ---------
                                                 $   1,089000           125,000     1,214,000
                                                    =========       ===========     =========
                                                    
Year ended September 30, 1995:                      
 Current                                         $  1,088,000           120,000     1,208,000
 Deferred                                              47,000            17,000        64,000
                                                    ---------       -----------     ---------
                                                 $  1,135,000           137,000     1,272,000
                                                    =========       ===========     =========
                                                    
Year ended September 30, 1994:                      
 Current                                         $    945,000           132,000     1,077,000
 Deferred                                            (160,000)          (23,000)     (183,000)
                                                    ---------       -----------     ---------
                                                 $    785,000           109,000       894,000
                                                    =========       ===========     =========
</TABLE>
The reasons for the differences between the effective tax rates and the expected
federal income tax rate of 34% are as follows:
<TABLE>
<CAPTION>
 
                                                 Percentage of
                                                earnings before
                                                 income taxes
                                            ----------------------
                                            1996     1995     1994
                                            ----     ----     ---- 
 
<S>                                         <C>      <C>      <C>
Expected federal income tax rate            34.0%    34.0     34.0
State taxes, net of federal tax benefit      2.3      2.5      2.9
Other, net                                    .1      (.9)     (.3)
                                            ----     ----     ----
          Effective income tax rate         36.4%    35.6     36.6
                                            ====     ====     ====
</TABLE>
                                                                     (Continued)

                                      35
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


Temporary differences which give rise to a significant portion of deferred tax
     assets and liabilities at September 30, 1996 and 1995 are as follows:
<TABLE>
<CAPTION>
 
                                               1996          1995
                                               ----          ---- 
<S>                                         <C>            <C>
Accrued and prepaid expenses                $  295,000         -
Accrued compensation                           283,000      170,000
Loan origination fees, net of deferred            -          29,000
 costs
Allowance for loan losses                      457,000      319,000
Other                                                -       15,000
                                            ----------     --------
        Deferred income tax asset            1,035,000      533,000
                                            ----------     --------
 
Loan origination fees, net of deferred        (123,000)        -
 costs
FHLB dividends                                (186,000)    (176,000)
Accrued and prepaid expenses                         -      (62,000)
Federal and state taxes related to
 reversing temporary differences               (69,000)     (27,000)
Accrued interest on loans originated
 prior to September 25, 1985                   (25,000)     (31,000)
Depreciation of fixed assets                   (13,000)     (29,000)
Other                                           (8,000)        -
                                            ----------     --------
        Deferred income tax liability         (424,000)    (325,000)
                                            ----------
        Net deferred income taxes              611,000      208,000
                                            ==========     ========
</TABLE>
     There was no valuation allowance for deferred tax assets at September 30,
          1996 or 1995.

     Under the Internal Revenue Code, the Association is allowed to deduct the
          greater of an experience method bad debt deduction based on actual
          charge-offs or a statutory bad debt deduction based on a percentage
          (8%) of taxable income before such deduction. This deduction is an
          addition to tax bad debt reserves established for the purpose of
          absorbing losses. The allowable deduction under the percentage of
          taxable income method is subject to certain statutory limitations,
          which applied at September 30, 1996, 1995 and 1994. Under the Small
          Business Job Protection Act (the Act) of 1996, the allowable deduction
          under the taxable income method was terminated for tax years beginning
          after 1995 and will not be available to the Association for future
          years. The Act also provides that federal income tax bad debt reserves
          in excess of the base year reserves will be included in taxable income
          over a six year inclusion period. The Association has established a
          deferred tax liability of approximately $96,000 for this recapture.

     Retained earnings of the Association at September 30, 1996 and 1995
          includes approximately $4,600,000, for which no provision for federal
          income tax has been made. This amount represents allocations of income
          to bad debt deductions for tax purposes only. Reduction of amounts
          allocated for purposes other than tax bad debt losses will create
          income for tax purposes only, which will be subject to the then
          current corporate income tax rate.

                                                                     (Continued)


                                      36
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


(10) Benefit Plans
     -------------

     Pension and Retirement Plans
     ----------------------------

     The Association has a supplemental retirement plan to provide members of
          the Board of Directors with supplemental retirement, disability and
          death benefits. The Plan provides benefits for directors or their
          beneficiaries after they have completed service to the Association.
          The annual benefits are equal to the number of years of service on the
          board times $500, paid monthly for ten years following retirement.
          Expense under the plan for the years ended September 30, 1996, 1995
          and 1994 amounted to $29,000, $24,000 and $380,000, respectively. 1994
          expense included an accrual for past service costs. The Association
          purchased life insurance policies to fund its obligations under the
          plan in October 1994, which are included in other assets.

     Employee Stock Ownership Plan (ESOP)
     ------------------------------------

     All employees meeting age and service requirements are eligible to
          participate in an ESOP. Under the terms of the ESOP, contributions are
          allocated to participants using a formula based upon compensation.
          Participants vest over five years.

     In connection with the conversion described in note 1, the ESOP purchased
          242,154 shares of Company common stock. The remaining unamortized cost
          of such shares purchased is reflected as unearned employee benefits in
          the accompanying consolidated balance sheet. On September 30, 1996 and
          1995, 30,605 and 24,366 shares were allocated to participants. The
          fair value of such shares, $425,000 and $303,000, respectively, was
          charged to expense. The fair value of the remaining unallocated shares
          at September 30, 1996 aggregated $2,761,000.

     Stock Option and Recognition and Retention Plan
     -----------------------------------------------

     The Board of Directors approved the adoption of a stock option plan and a
          recognition and retention plan (RRP) in January 1996. Under the stock
          option plan, options to acquire 302,692 shares of the Company's common
          stock may be granted to certain officers and directors of the Company
          or the Association. In January 1996, the Company awarded options to
          acquire 186,323 shares of stock. The options enable the recipients to
          purchase stock at an exercise price equal to the fair market value of
          the stock at the date of the grant ($14.56). The options vest over the
          five years following the date of grant. No stock options were
          exercised by recipients during 1996.

     Under the RRP, common stock aggregating 121,077 shares may be awarded to
          certain officers and directors of the Company or the Association. In
          January 1996, the Company awarded 95,675 shares with a market value of
          $1,399,000. These shares have been reflected as unearned employee
          benefits in the accompanying 1996 consolidated balance sheet.
          Participants vest over five years. As the awards vest, they are
          reflected as compensation expense. The amortization of the RRP awards
          during 1996 was $193,000. The unamortized cost of the RRP awards at
          September 30, 1996 was $1,206,000.

                                                                     (Continued)

                                      37
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


(11) Federal Deposit Insurance Premiums
     ----------------------------------

     The deposits of the Association are presently insured by the Savings
          Association Insurance Fund (SAIF), which together with the Bank
          Insurance Fund (BIF), are the two insurance funds administered by the
          FDIC. In the third quarter of 1995, the FDIC lowered the premium
          schedule for BIF-insured institutions in anticipation of the BIF
          achieving its statutory reserve ratio. The reduced premium created a
          significant disparity in deposit insurance expense, causing a
          competitive advantage for BIF members. Legislation enacted on
          September 30, 1996 provided for a one-time special assessment of .657%
          of the Association's SAIF insured deposits at March 31, 1995. The
          purpose of the assessment is to bring the SAIF to its statutory
          reserve ratio. Based on the above formula, the Association's SAIF
          assessment of $800,000 was recorded in the 1996 consolidated financial
          statements. Although the special one-time assessment significantly
          increased noninterest expense for the year, the anticipated reduction
          in the premium schedule will reduce the Association's federal
          insurance premiums for future periods.

(12) Regulatory Capital Requirements
     -------------------------------

     The Association is subject to various regulatory capital requirements
          administered by the federal banking agencies. Failure to meet minimum
          capital requirements can initiate certain mandatory, and possibly
          additional discretionary, actions by regulators that, if undertaken,
          could have a direct material effect on the Association's consolidated
          financial statements. Under capital adequacy guidelines and the
          regulatory framework for prompt corrective action, the Association
          must meet specific capital guidelines that involve quantitative
          measures of the Association's assets, liabilities and certain off-
          balance sheet items as calculated under regulatory accounting
          practices. The Association's capital amounts and classification are
          also subject to qualitative judgments by the regulators about
          components, risk weightings and other factors.

     Quantitative measures established by regulation to ensure capital adequacy
          require the Association to maintain minimum amounts and ratios (set
          forth in the table below) of risk-based capital, as defined in the
          regulations, to risk-weighted assets, as defined, and of tangible and
          core capital, as defined, to total assets, as defined. Management
          believes, as of September 30, 1996, that the Association meets all
          capital adequacy requirements to which it is subject.

     As of August 31, 1996, the most recent notification from the Office of
          Thrift Supervision (OTS) categorized the Association as well
          capitalized under the regulatory framework for prompt corrective
          action. To be categorized as well capitalized, the Association must
          maintain minimum total risk-based, tangible and core capital ratios as
          set forth in the table. There are no conditions or events since that
          notification that management believes have changed the institution's
          category.

                                                                     (Continued)


                                      38
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements
<TABLE>
<CAPTION>
 
 
                                                  Tangible         Core       Risk-based
                                                  --------         ----       ----------
<S>                                         <C>                <C>           <C>
Regulatory capital                          $    32,928,000     32,928,000    33,161,000
Minimum capital requirement                       2,612,000      5,224,000     9,386,000
                                                 ----------     ----------    ----------
  Regulatory capital in excess of
    minimum capital requirements            $    30,316,000     27,704,000    23,775,000
                                                 ==========     ==========    ==========
 
Minimum capital requirement                             1.5%           3.0           8.0
                                                        ===            ===           ===
 
The Association's regulatory capital                   18.9%          18.9          28.3
                                                       ====           ====          ====
</TABLE>
(13) Fair Value of Financial Instruments
     -----------------------------------

     SFAS No. 107, "Disclosures About Fair Value of Financial Instruments," and
          SFAS No. 119, "Disclosures About Derivative Financial Instruments and
          Fair Value of Financial Instruments," require disclosure of estimated
          fair values of financial instruments, both assets and liabilities
          recognized and not recognized in the consolidated financial
          statements. Fair value estimates have been made as of September 30,
          1996 based on then current economic conditions, risk characteristics
          of the various financial instruments and other subjective factors.

     The following methods and assumptions were used to estimate the fair value
          of each class of financial instrument for which it is practicable to
          estimate that value:

          Cash and Cash Equivalents and Certificates of Deposit
          -----------------------------------------------------

          The carrying amounts approximate fair value because of the short
          maturity of these instruments.

          Investment Securities and Mortgage-backed Securities
          ----------------------------------------------------

          The fair values of investment securities and mortgage-backed
          securities are estimated based on published bid prices or bid
          quotations received from securities dealers.

          Certificates of Deposit in Other Financial Institutions
          -------------------------------------------------------

          The fair values of certificates of deposit are estimated based on the
          static discounted cash flow approach using rates currently offered for
          deposits of similar remaining maturities.

          Loans Receivable
          ----------------

          The fair values of loans receivable are estimated using the option-
          based approach. Cash flows consist of scheduled principal, interest
          and prepaid principal. Loans with similar characteristics were
          aggregated for purposes of these calculations.

                                                                     (Continued)


                                      39
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


          Accrued Interest
          ----------------

          The carrying amount of accrued interest is assumed to be its carrying
          value because of the short-term nature of these items.

          Stock in the FHLB
          -----------------

          The carrying amount of such stock is estimated to approximate fair
          value.

          Deposits
          --------

          The fair values of deposits with no stated maturity are deemed to be
          equivalent to amounts payable on demand. The fair values of
          certificates of deposit are estimated based on the static discounted
          cash flow approach using rates currently offered for deposits of
          similar remaining maturities.

          FHLB Advances
          -------------

          The fair values of FHLB advances are estimated based on discounted
          values of contractual cash flows using the rates currently available
          to the Association for advances of similar remaining maturities. The
          carrying amount of the advances under the line of credit approximates
          fair value due to the short maturity.

     Fair value estimates of the Association's financial instruments as of
          September 30, 1996 are set forth below:
<TABLE>
<CAPTION>
 
                                                  Carrying       Estimated
                                                   amount       fair value
                                                   ------       ----------
<S>                                         <C>                 <C>
Cash and cash equivalents and
 certificates of deposit                    $      6,283,000      6,283,000
                                                 ===========    ===========
 
Investment securities                       $     18,297,000     18,249,000
                                                 ===========    ===========
 
Mortgage-backed securities                  $         13,000         13,000
                                                 ===========    ===========
 
Loans receivable, net of loans in           $    154,444,000    156,620,000
 process                                         ===========    ===========
 
Accrued interest receivable                 $      1,296,000      1,296,000
                                                 ===========    ===========
 
Stock in the FHLB                           $      1,259,000      1,259,000
                                                 ===========    ===========
 
Deposits:
 Money market and NOW deposits              $     12,788,000     12,788,000
 Passbook accounts                                11,179,000     11,179,000
 Certificate accounts                             99,141,000     98,951,000
                                                 -----------    -----------
          Total deposits                    $    123,108,000    122,918,000
                                                 ===========    ===========
 
FHLB Advances                               $     12,250,000     12,152,000
                                                 ===========    ===========
 
Accrued interest payable                    $        141,000        141,000
                                                 ===========    ===========
</TABLE>
                                                                     (Continued)

                                      40
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


     Limitations
     -----------

     Fair value estimates are made at a specific point in time, based on
          relevant market information and information about the financial
          instruments. These estimates do not reflect any premium or discount
          that could result from offering for sale at one time the Association's
          entire holdings of a particular financial instrument. Because no
          market exists for a significant portion of the Association's financial
          instruments, fair value estimates are based on judgments regarding
          future loss experience, current economic conditions, risk
          characteristics of various financial instruments and other factors.
          These estimates are subjective in nature and involve uncertainties and
          matters of significant judgment and therefore cannot be determined
          with precision. Changes in assumptions could significantly affect the
          estimates. Fair value estimates are based on existing balance sheet
          financial instruments without attempting to estimate the value of
          anticipated future business and the value of assets and liabilities
          that are not considered financial instruments.

(14) Parent Company Condensed Financial Statements
     ---------------------------------------------

                           Condensed Balance Sheets
                          September 30, 1996 and 1995
<TABLE>
<CAPTION>
 
                                                1996            1995
                                                ----            ----    
<S>                                         <C>              <C>
Cash and cash equivalents                     $ 2,630,000     2,324,000
Investment securities held-to-maturity          9,443,000    11,370,000
Investment in Association                      32,928,000    32,913,000
ESOP loan receivable                            1,937,000     2,179,000
Other                                              97,000       201,000
                                              -----------    ----------
     Total assets                             $47,035,000    48,987,000
                                              ===========    ==========
 
Dividends payable                             $   199,000       212,000
Other liabilities                                  21,000        48,000
                                              -----------    ----------
     Total liabilities                            220,000       260,000
 
Stockholders' equity                           46,815,000    48,727,000
                                              -----------    ----------
     Total liabilities and stockholders'      
          equity                              $47,035,000    48,987,000
                                              ===========    ========== 

</TABLE>

                          Condensed Income Statements
                       Year ended September 30, 1996 and
        Period from inception (December 19, 1994) to September 30, 1995
<TABLE>
 
<S>                                         <C>              <C>
Dividend income                               $2,248,000       925,000
Interest income                                  969,000       508,000
Expense                                         (510,000)     (147,000)
                                              ----------     ---------
     Income before equity in undistributed
          earnings of Association              2,707,000     1,286,000
 
Equity in undistributed (loss)
     earnings of the Association                (597,000)      215,000
                                              ----------     ---------
          Net income                          $2,110,000     1,501,000
                                              ==========     =========
</TABLE>
                                                                     (Continued)


                                      41
<PAGE>
 
                 CAMERON FINANCIAL CORPORATION AND SUBSIDIARY

                  Notes to Consolidated Financial Statements


                      Condensed Statements of Cash Flows
                       Year ended September 30, 1996 and
        Period from inception (December 19, 1994) to September 30, 1995
<TABLE>
<CAPTION>
 
                                                1996             1995
                                                ----             ----    
<S>                                         <C>              <C>
Cash provided by operations:
   Net earnings                              $ 2,110,000       1,501,000
   Amortization                                  (31,000)        (44,000)
   Change in other assets                        104,000        (186,000)
   Change in other liabilities                   (30,000)         48,000
   Undistributed earnings of                
    subsidiary, net                              597,000        (215,000)
                                             -----------     -----------  
          Cash provided by operations          2,750,000       1,104,000
                                             -----------     -----------
 
Cash used by investing activities:
   Purchase of investment securities          
     held-to-maturity                         (2,042,000)    (12,325,000) 
   Proceeds from ESOP note receivable            241,000         243,000
   Purchase of investment in subsidiary             -        (14,724,000)
   Maturities of investment securities      
    held-to-maturity                           4,000,000       1,000,000
                                             -----------     ----------- 
          Cash used in investing activities    2,199,000     (25,806,000)
                                             -----------     -----------
 
Cash provided by financing activities:
   Proceeds from stock offering, net of                
    conversion costs                               -          27,026,000 
   Purchase of treasury stock                 (3,881,000)         -
   Dividends paid                                (762,00)         -
                                             -----------     -----------
          Cash provided by financing        
            activities                        (4,643,000)     27,026,000
                                             -----------     ----------- 
Net increase in cash                         $   306,000       2,324,000
                                             ===========     ===========
 
Cash and cash equivalents at                 
   beginning of period                       $ 2,324,000          -
                                             ===========     =========== 

Cash and cash equivalents at end of          
   period                                    $ 2,630,000       2,324,000
                                             ===========     =========== 
</TABLE>

Dividends paid by the Company are primarily provided through Association
     dividends paid to the Company. At September 30, 1996, the Company 
     had declared dividends of $199,000 which had not been paid as of 
     year-end. During 1996, the Association paid dividends of $2,248,000 
     to the Company.


                                      42
<PAGE>
 
                         CAMERON FINANCIAL CORPORATION
                         -----------------------------
                            STOCKHOLDER INFORMATION
                            -----------------------



Annual Meeting
--------------

The Annual Meeting of Stockholders will be held at 4:00 p.m., Cameron, Missouri
time on January 27, 1997, at the American Legion Hall located on U.S. Highway 69
at the south edge of Cameron, Missouri 64429.

Stock Listing
-------------

Cameron Financial Corporation common stock is traded on the National Association
of Securities Dealers, Inc. National Market under the symbol "CMRN."

Price Range of Common Stock
---------------------------

The per share price range of the common stock for each quarter since conversion
was as follows:
<TABLE>
<CAPTION>
 
           Fiscal Year 1995         High      Low      Dividends
           ----------------         ----      ---      ---------
           <S>                     <C>       <C>       <C>
           Third Quarter           $12.13    $10.50      $ -
           Fourth Quarter          $15.50    $11.38      $.07
                   
           Fiscal Year 1996   
           ----------------   
                   
           First Quarter           $14.75    $13.50      $.07
           Second Quarter          $15.25    $13.75      $.07
           Third Quarter           $14.50    $13.50      $.07
           Fourth Quarter          $15.25    $13.50      $.07
</TABLE>

A $.07 per share dividend was declared by the Board of Directors on September
17, 1996, payable October 28, 1996 to stockholders of record on October 11,
1996.  The stock price information set forth in the table above was provided by
the National Association of Securities Dealers, Inc., Automated Quotation
System.

At December 13, 1996, there were 2,849,280 shares of Cameron Financial
Corporation common stock issued and outstanding (including unallocated ESOP
shares) and there were 546 registered holders of record.

Shareholders and General Inquiries    Transfer Agent
----------------------------------    --------------

David G. Just, President              Registrar and Transfer Co.
Cameron Financial Corporation         10 Commerce Drive
123 East Third Street                 Cranford, New Jersey 07016
Cameron, Missouri 64429
(816) 632-2154

Annual and Other Reports
------------------------

A copy of Cameron Financial Corporation's Annual Report on Form 10-K for the
year ended September 30, 1996, as filed with the Securities and Exchange
Commission, may be obtained without charge by contacting David G. Just,
President and Chief Executive Officer, Cameron Financial Corporation, 123 East
Third Street, Cameron, Missouri 64429.


                                      43
<PAGE>
 
                         CAMERON FINANCIAL CORPORATION
                         -----------------------------
                             CORPORATE INFORMATION
                             ---------------------



Company and Association Address
-------------------------------

123 East Third Street             Telephone:  (816) 632-2154
Cameron, Missouri 64429           Fax:     (816) 632-2157
 
 
Directors of the Board
----------------------

Herschel Pickett                         George E. Hill
  Chairman of Cameron Financial            Retired Western Auto Associate Store
    Corporation, and                         owner
  The Cameron Savings and Loan         
    Association, F.A., and retired       Harold D. Lee
    CEO of The Cameron Savings &           Owner, Lee Auto & Tractor
    Loan Association, F.A.                   NAPA Dealership
                                         
David G. Just                            Jon N. Crouch
  President of Cameron Financial           Manager, Cameron Memorial Airport
    Corporation and                        Owner, Crouch Aviation
  The Cameron Savings & Loan               Retired Frontier and Continental
    Association, F.A.                        Airlines Captain
                                         
Kennith R. Baker                         William F. Barker, DDS
  Agent, State Farm Insurance              Owner, Barker Dental Clinic
 

Cameron Financial Corporation Executive Officers
------------------------------------------------

David G. Just                            Ronald W. Hill
  President and Chief Executive Officer    Vice President and Treasurer
 
The Cameron Savings & Loan Association, F.A. Executive Officers
---------------------------------------------------------------
 
David G. Just                            Ronald W. Hill
  President and Chief Executive Officer    Vice President and Treasurer
 
Stephen D. Hayward                       Earl T. Frazier
  Director of Lending                      Manager, Liberty Loan Production
                                             Office
 
 
Independent Auditors                     Special Counsel
--------------------                     ---------------
 
KPMG Peat Marwick LLP                    Luse, Lehman, Gorman,
1000 Walnut, Suite 1600                    Pomerenk & Schick, PC
Post Office Box 13127                    5335 Wisconsin Avenue, N.W.
Kansas City, Missouri 64199              Suite 400
                                         Washington, D.C. 20015
 
                                      44