[COMPANY LOGO]
                    Tri-County Bancorp, Inc.
                    1999 Annual Report
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       TABLE OF CONTENTS
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            Selected Financial Data                             i
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            Letter to Stockholders                             ii
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            Management's Discussion and Analysis                1
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            Report of Independent Auditors                      9
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            Consolidated Statements of Financial Condition     10
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            Consolidated Statements of Operations              11
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            Consolidated Statements of Stockholders' Equity    12
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            Consolidated Statements of Cash Flows              13
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            Notes to Consolidated Financial Statements         15
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            Corporate and Stockholders' Information            31
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SELECTED FINANCIAL DATA
                                                 At December 31,
                                    1999      1998     1997    1996    1995
                                  -------------------------------------------
                                                  (In Thousands)
BALANCE SHEET DATA Total amount of:
   Assets                         $88,516   $81,308 $89,961  $85,888  $65,766
   Loans receivable, net           48,980    42,054  40,425   35,265   25,514
   Mortgage-backed & investment
     securities - Available for
     sale                          27,239    28,727  36,526   35,140   18,097
   Mortgage-backed & investment
     securities - Held to           7,238     5,336   7,987   10,320   18,264
   maturity
   Deposits                        51,809    45,974  45,405   48,533   44,583
   FHLB advances                   25,558    23,799  29,697   23,460    7,000
   Stockholders' equity            10,251    10,421  13,827   13,146   13,496

                                             Year Ended December 31,
                                    1999     1998      1997    1996    1995
                                  -------------------------------------------
                                                  (In Thousands)
STATEMENT OF OPERATIONS DATA
   Interest income                 $5,923    $6,173  $6,466   $5,494   $4,600
   Net interest income              2,505     2,627   2,744    2,468    2,266
   Provision for loan losses           --        --      --       --       --
   Non-interest income                313       291     105      159      171
   Non-interest expenses            1,658     1,564   1,623    1,811(1) 1,458
   Net income                         794       938     901      540(1)   649


                                        At or For Year Ended December 31,
                                    1999     1998      1997    1996     1995
                                  -------------------------------------------
FINANCIAL RATIOS & OTHER DATA
   Return on average assets        0.94%    1.09%     1.02%    0.71%(1) 1.04%
   Return on average               7.69%    6.72%     6.68%    4.05%(1) 4.96%
   stockholders' equity
   Average interest rate spread    2.53%    2.39%     2.48%    2.68%    2.69%
   Net yield on average earning
   assets                          3.07%    3.14%     3.19%    3.35%    3.62%
   Non-interest expense to
   total assets                    1.87%    1.92%     1.80%    2.11%(1) 2.22%
   Average equity/average total
   assets                         12.17%   16.03%    15.20%   16.82%   20.47%
   Non-performing loans/total
   assets                          0.00%    0.00%     0.00%    0.04%    0.03%
   Dividends/total income         49.27%   50.13%    42.95%   57.83%(1)37.40%

                                        At or For Year Ended December 31,
                                    1999     1998     1997     1996     1995
                                  -------------------------------------------
PER SHARE INFORMATION(2)
   Earnings per share - diluted   $0.85    $0.78     $.071     $0.41(1) $0.47
   Dividends per share             0.44     0.43      0.33      0.25     0.19
   Book value per share           11.31    11.86     11.84     10.80    10.53

------------------------------
(1)Includes the effect of a one-time special assessment to recapitalize
   the SAIF.
(2)Restated to reflect 100% stock dividend paid December 8, 1997


                                                                               i
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To Our Stockholders:

Tri-County  Bancorp,  Inc.  achieved  a third year of record  earnings  in 1999.
Earnings per share on a fully diluted basis were $0.85,  which  exceeded 1998 by
9.0% or $0.07.  The tender  offer  completed  in late 1998 reduced the number of
shares  outstanding and provided a positive  influence to the excellent earnings
per share performance this year.  Additionally,  as a result of the tender offer
in 1998  capital was reduced by $4.5  million.  The loss of capital  reduced the
amount of low cost funds available for investment and contributed to a reduction
in total  income of  $144,000.  Both the  increase in earnings per share and the
reduction in the dollar amount of earnings were anticipated.

This year was also significant with a 16.5% increase in the loan portfolio,  and
an 8.3%  increase in deposits  (when  reduced by a $2,000,000  short term public
deposit  at year  end).  Securities  varied  by only a small  increase  over the
previous  year.  These changes are  consistent  with the goals of the Company of
increasing loans and deposits while holding the investment portfolio at or below
its present level.

The Company has made other significant  changes this past year. The first is our
entrance into agricultural lending and increased emphasis on commercial business
relationships. Joe Guth, our Executive Vice President, joined our Company in May
and has helped to  facilitate  this change.  Secondly,  we are in the process of
opening a new branch in Cheyenne,  Wyoming.  We will  emphasize  small  business
relationships in the Cheyenne market and expect that this new facility will help
shift the asset mix over a period of time to higher  yielding  and shorter  term
loans.  As of the writing of this letter,  the new  Cheyenne  branch is close to
completion,  and we expect to have it open in early  April.  The new branch will
have a negative impact on earnings for a few years until it reaches a break-even
point, however, we have set aggressive goals for the branch and expect success.

The Company announced a repurchase of 5% of outstanding common stock in February
2000. We expect to complete this  repurchase  program soon and at very favorable
prices.

We thank the  Stockholders  for their continued  support of the Company.  Please
contact us with your questions about Tri-County Bancorp, Inc.

Sincerely,



Robert L. Savage                                  Larry C. Goddard
President and Chief Executive Officer             Chairman of the Board

                                                                              ii
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MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

THE COMPANY'S BUSINESS

Tri-County  Bancorp,  Inc. (the "Company") is a unitary savings and loan holding
company  which,  under  existing  laws,  may engage in various types of business
activities,  provided  that  Tri-County  Bank ("the  Bank")  retains a specified
amount of its assets in housing-related  investments. At the present time, since
it does not conduct any active  business,  the Company does not intend to employ
any persons other than officers, using the support staff from the Bank from time
to time to meet its administrative needs.

The  Bank  is  a  federally   chartered  stock  savings  bank  headquartered  in
Torrington, Wyoming with an additional branch office in Wheatland, Wyoming and a
new branch in Cheyenne,  Wyoming  that is  scheduled to open in April 2000.  The
Bank was founded in 1935 as a federally  chartered  savings and loan association
under the name  Tri-County  Federal  Savings  and Loan  Association.  The Bank's
deposits  are  federally  insured  by the  Savings  Association  Insurance  Fund
("SAIF"). The Bank converted from mutual to stock form in September 1993.

The Bank is primarily engaged in attracting deposits from the general public and
using  those  funds  to  originate  real  estate  loans  on  one-to-four  family
residences and, to a lesser extent, consumer loans,  agricultural and commercial
real estate loans, and  agricultural  and commercial  business loans. The Bank's
market area is primarily  Goshen and Platte  Counties,  Wyoming and  Scottsbluff
County in western Nebraska and will expand into Laramie County, Wyoming when the
Cheyenne  branch  opens.  The Bank offers its  customers  several  types of real
estate loans,  including  adjustable-rate and fixed-rate mortgage loans and also
originates  multi-family  and commercial real estate loans,  and consumer loans,
including  automobile  and home equity loans.  In addition,  the Bank  purchases
loans from and  participates in loans with other financial and mortgage  banking
institutions on a case by case basis.  These activities are conducted in Wyoming
and other Rocky Mountain States. The Bank also invests in investment  securities
and mortgage-backed securities.


                                                                               1
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CAPITAL STOCK

Since its issuance in September 1993, the Company's common stock has been traded
over-the-counter  on the Nasdaq  SmallCap  MarketSM  appearing  under the symbol
"TRIC." The following  table reflects the stock price as published by the Nasdaq
statistical report.

                                                           DIVIDEND
      1998                           LOW      HIGH         DECLARED
      First Quarter--03/31/98      $13.13    $15.00         $.10
      Second Quarter--06/30/98     $12.50    $16.50         $.11
      Third Quarter--09/30/98      $11.50    $13.00         $.11
      Fourth Quarter--12/31/98     $11.25    $14.00         $.11

      1999
      First Quarter--03/31/99      $10.50    $14.69         $.11
      Second Quarter--06/30/99      $9.81    $13.31         $.11
      Third Quarter--09/30/99       $9.00    $13.75         $.11
      Fourth Quarter--12/31/99      $8.25    $11.75         $.11

The number of shareholders  of record as of December 31, 1999 was  approximately
219.  This does not reflect the number of persons or entities  who held stock in
nominee or "street" name through various  brokerage  firms. At December 31, 1999
there were 906,234 shares outstanding.  The Company completed a tender offer for
stock in December of 1998 whereby  314,125  shares were  purchased at a price of
$14.00 per share.

The Company's  ability to pay dividends to  stockholders  is dependent  upon the
dividends  it  receives  from the Bank.  The Bank may not  declare or pay a cash
dividend  on any of its stock if the  effect  thereof  would  cause  the  Bank's
regulatory  capital  to be  reduced  below  (1)  the  amount  required  for  the
liquidation  account  established in connection with the Bank's  conversion from
mutual to stock form, or (2) the regulatory capital  requirements imposed by the
Office of Thrift  Supervision  ("OTS"),  the  Bank's  chartering  authority  and
primary federal regulator.

FINANCIAL CONDITION

ASSETS

Total assets of the Bank  increased by $7.21 million or 8.86% during the year of
1999.  The increase was primarily  the result of increases in loans  receivable,
securities  held to maturity  and bank  property and  equipment  which more than
offset decreases in interest earning deposits and securities available for sale.

Interest  earning  deposits  decreased  $1.85  million  during the  period.  The
decrease was primarily the result of the funding of loans.

Securities  available for sale  decreased by $1.49 million during the year ended
December 31,  1999.  Securities  totaling  $3.44  million  were sold,  principal
payments  and  prepayments  of $5.39  million were  received on  mortgage-backed
securities, a $1 million agency security was called by the issuer and the market
value of the  securities  decreased  $1.26  million  during  the  period.  These
decreases were partially offset by purchases of agency securities  totaling $9.5
million.

                                                                               2
<PAGE>

Securities  held to maturity  increased  by $1.9  million.  The increase was the
result of the  purchase  of agency and  mortgage-backed  securities  totaling $4
million  which more than offset  principal  payments  and  prepayments  of $1.59
million on the Bank's portfolio of  mortgage-backed  securities and the maturity
of a $500,000 agency security.

Loans receivable increased $6.93 million during the twelve months ended December
31,  1999.  During this  period,  the Bank  originated  or  purchased  portfolio
residential  mortgage loans totaling  $10.03 million,  non-residential  mortgage
loans  totaling $4.15  million,  consumer  loans  totaling  $3.14  million,  and
commercial  loans  totaling  $1.66  million.  During the same  period,  the Bank
received scheduled principal payments and prepayments totaling $15.21 million on
its loan portfolio.  Of the total mortgage loans  originated or purchased during
the year,  $7.13 million were  adjustable rate and $7.05 million were fixed rate
loans.  Because  of a lack of demand  for  certain  types of loans in the Bank's
primary lending area, purchased loans totaled 32% of mortgage lending during the
period. The majority of purchased loans are residential and non-residential real
estate   loans  in  Colorado  and  Idaho   mountain   resort   communities   and
non-residential  real estate loans along the front range of Colorado.  Purchased
loans are subjected to the same  underwriting  standards and loan terms as those
originated by the Bank for its portfolio.

Bank  property and  equipment  increased by $1.23  million and was primarily the
result of the purchase of land and the continuing  construction  of a new branch
bank located in Cheyenne,  Wyoming.  The parcel of land consists of 4.5 acres of
which 1 acre will be used as the site for the new branch and the  remaining  3.5
will be offered for sale or held for future development  jointly by the Bank and
an undetermined  third party.  The total cost of the facility is estimated to be
$1.4 million and the  projected  opening date is in the second  quarter of 2000.
The Bank has sufficient liquid assets to fund the cost of the new facility.

LIABILITIES

Deposit  balances  increased by $5.84  million or 12.69% from $45.97  million at
December  31, 1998 to $51.81  million at December  31,  1999.  The net  increase
consisted of a decrease of $0.13  million in savings  accounts and  increases of
$0.31 million, $1.84 million, and $3.82 million in demand deposits, NOW and time
deposits, respectively.

Advances from the Federal Home Loan Bank ("FHLB") increased $1.76 million during
the year of 1999.  The advances are a supplement to the Bank's  retail  deposits
and were used to fund loan  originations  and to purchase  loans and  investment
securities.

Deferred  income taxes decreased by $0.38 million during the year and was mainly
the  result  of  the  application  of  SFAS  No.  115,  Accounting  for  Certain
Investments in Debt and Equity Securities,  which requires  unrealized gains and
losses on available for sale  securities to be reported,  net of deferred income
taxes,  as a separate  component of  stockholders'  equity.  The market value of
these securities  decreased $1.26 million during the period, which resulted in a
decrease in deferred income taxes.

STOCKHOLDERS' EQUITY

Overall, stockholders' equity decreased $0.17 million during the year.

The increase in additional  paid-in capital of $211,000 was caused,  in part, by
the  application  of an accounting  standard  which  requires  charging  current
expense  for the fair value of shares of stock  committed  to be released by the
Bank's  Employee Stock  Ownership Plan and crediting the difference  between the
fair value and the cost of the shares to paid-in  capital  which  resulted in an
increase of $73,000.  Also,  directors and officers of the Bank exercised  stock
options  on  28,186  shares,  which  increased  additional  paid-in  capital  by
$138,000.

                                                                               3
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The  increase  in  retained  earnings  was the result of net  earnings  totaling
$794,000 which more than offset the decrease in retained  earnings caused by the
payments of dividends of $0.44 per share totaling $391,000.

As  discussed  earlier,  SFAS No. 115  requires  unrealized  gains and losses on
securities  classified available for sale to be shown as a separate component of
stockholders'  equity in an amount,  which is net of deferred income taxes.  The
market value of securities classified as available for sale decreased during the
twelve-month  period and resulted in a decrease,  net of deferred income tax, of
$834,000 in stockholders' equity.

AVERAGE BALANCE SHEET

The following table sets forth certain  information  relating to average balance
sheets and reflects the average yield on assets and average cost of  liabilities
for the periods  indicated and the average  yields  earned and rates paid.  Such
yields and costs are  derived  by  dividing  income or  expense  by the  average
balance  of assets or  liabilities,  respectively,  for the  periods  presented.
Average  balances  are derived  from  month-end  balances.  Management  does not
believe that the use of month-end  instead of daily average  balances has caused
any material difference in the information presented.

<TABLE>
<CAPTION>
                                           12 Months Ended Dec.                12 Months Ended Dec.
                                                 31, 1999                           31, 1998
                                       -------------------------------------------------------------------

                                       Average               Average        Average              Average
                                       Balance    Interest  Yield/Cost      Balance  Interest  Yield/Cost
                                       -------    --------  ----------      -------  --------  ----------
<S>                                    <C>        <C>      <C>             <C>       <C>       <C>
Interest-earning assets:
  Loans receivable                     $45,919     $3,681       8.02%       $42,012   $3,465     8.25%
  Securities - Available for
   sale                                 28,656      1,780       6.21%        33,446    2,099     6.28%
  Securities - Hold to maturity          5,615        398       7.09%         6,697      504     7.53%
  Other interest-earning assets          1,412         64       4.53%         2,331      105     4.50%
                                         -----         --                     -----      ---
   Total interest-earning assets       $81,602     $5,923       7.26%       $84,486   $6,173     7.31%
                                                   ------                             ------
Non-interest earning assets              2,730                                1,665
                                         -----                                -----
   Total Assets                        $84,332                              $86,151
                                       =======                              =======
Interest-bearing liabilities:
  Interest-bearing demand deposits     $11,865       $381       3.21%        $8,689     $282     3.25%
  Savings deposits                       4,268        119       2.79%         4,529      125     2.76%
  Time deposits                         31,011      1,534       4.95%        31,016    1,645     5.30%
  Other borrowings                      25,088      1,384       5.52%        25,954    1,494     5.76%
                                        ------      -----                    ------    -----
   Total interest-bearing liabilities  $72,232     $3,418       4.73%       $70,188   $3,546     5.05%
                                                   ------                             ------
Non-interest bearing demand deposits       719                                  824
Other non-interest bearing
  liabilities                            1,143                                1,264
                                         -----                                -----
                Total liabilities      $74,094                              $72,276
Retained earnings                       10,238                               13,875
                                        ------                               ------
   Total liabilities & retained
     earnings                          $84,332                              $86,151
                                       =======                              =======
Net interest income                                $2,505                             $2,627
                                                   ======                             ======
Interest rate spread                                            2.53%                            2.26%
Net yield on interest earning
  assets (Margin)                                               3.07%                            3.11%
Ratio of average interest-earning
  assets to interest-bearing
  liabilities                                                 112.97%                          120.37%

</TABLE>
                                                                               4

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RATE/VOLUME ANALYSIS

The table below sets forth  certain  information  regarding  changes in interest
income and  interest  expense of the Bank for the  periods  indicated.  For each
category of interest-earning asset and interest-bearing  liability,  information
is provided on changes attributable to (i) changes in volume (changes in average
volume  multiplied  by old  rate);  (ii)  changes  in  rates  (changes  in  rate
multiplied by old average volume); (iii) changes in rate/volume (changes in rate
multiplied by the changes in average volume).
<TABLE>
<CAPTION>

                                     12 Months Ended Dec. 31      12 Months Ended Dec. 31
                                          1999 vs. 1998                1998 vs. 1997
                                    --------------------------   --------------------------
                                    Increase (Decrease) Due To   Increase (Decrease) Due To
                                    --------------------------   --------------------------
                                                   Rate/                        Rate/
                                    Volume  Rate  Volume  Net    Volume  Rate  Volume   Net
<S>                                 <C>    <C>    <C>   <C>      <C>    <C>    <C>    <C>
Interest-earning assets:
  Loans receivable                   322    (97)    (9)  216      352    (28)    (4)   320
  Securities - Available for sale   (356)  (173)   210  (319)    (356)  (173)    52   (477)
  Securities - Hold to maturity      (81)   (29)     4  (106)    (173)    (9)     2   (180)
  Other interest-earning assets      (41)     1     (1)  (41)      61     (9)    (8)    44
                                     ---      -     --   ---       --     --     --     --
    Total interest-earning assets   (156)  (298)   204  (250)    (116)  (219)    42   (293)

Interest-bearing liabilities:
  Savings accounts                   (88)  (144)   214   (18)     (88)   (49)     1   (136)
  Other liabilities                  (50)   (62)     2  (110)     (39)    (1)     0    (40)
                                     ---    ---      -  ----      ---     --      -    ---
     Total interest-bearing
       liabilities                  (138)  (206)   216  (128)    (127)   (50)     1 (  176)

Net change in interest income        (18)   (92)    12  (122)      11   (169)    41   (117)
                                     ===    ===     ==  ====       ==   ====     ==   ====
</TABLE>

RESULTS OF OPERATIONS

NET INCOME

Net income  decreased  $144,000  during the year ended  December  31,  1999 when
compared to 1998. Net interest income decreased by $122,000, non-interest income
increased by $23,000 and non-interest expense increased by $94,000.
The provision for income taxes decreased by $49,000.

INTEREST INCOME

Interest  income  from  loans  increased  $215,000  or 6.22% for the year  ended
December  31,  1999.  The  increase was the result of an increase in the average
balance of loans  outstanding of $4.14 million which more than offset a decrease
in yield on the loans from 8.25% to 8.02%.

The decrease of $319,000 in interest and dividends on  securities  available for
sale was the result of a decrease in the average  balance of securities of $4.26
million  and a decrease  in the  average  yield on the  portfolio  from 6.28% to
6.21%.  The decrease in yield was the result of the  disproportionately  greater
principal  payments and  prepayments on  mortgage-backed  securities with higher
yields when  compared to the overall  yield on the portfolio and the purchase of
securities with yields less than the yield on the existing portfolio.

Interest  on  securities  held to  maturity  decreased  $106,000  and was caused
primarily by a decrease in the average balance of the portfolio of $1.08 million
and a decrease in the yield on the portfolio  from 7.53% to 7.09%.  The decrease
in yield was the result of the disproportionately greater principal payments and
prepayments on  mortgage-backed  securities  with higher yields when compared to
the overall yield on the portfolio.

                                                                               5
<PAGE>



The  decrease  in income  from  other  interest-earning  assets of  $41,000  was
primarily caused by a decrease in the average balance of these assets which more
than  offset a slight  increase  in the yield on this  asset.  This  category of
assets consists primarily of interest-earning demand deposits held at FHLB.

INTEREST EXPENSE

Interest  expense on deposits  decreased  $18,000  during 1999 when  compared to
1998. This decrease was the result of a decrease in the average cost of deposits
from 4.64% to 4.31%,  which  offset an increase of $2.91  million in the average
balance of deposits.

The Bank took advantage of a relatively  inexpensive source of funding available
through  the  FHLB to  supplement  retail  deposits  and to  purchase  financial
instruments  that yield a slightly  higher  return than the rate  charged on the
advances.  The average balance of these borrowings was $866,000 less during 1999
than 1998 and the average cost of the  borrowings  decreased from 5.76% to 5.52%
which resulted in an decrease of $110,000 in interest expense.

PROVISION FOR LOAN LOSSES

No provision  for loan losses was made during the year ended  December 31, 1999.
The  allowance for loan losses is based on  management's  evaluation of the risk
inherent in its loan portfolio after giving due  consideration to the changes in
general  market  conditions  and in the nature  and  volume of the  Bank's  loan
activity.  The Bank  intends to continue to provide for loan losses based on its
periodic  review  of the loan  portfolio  and  general  market  conditions.  The
allowance  for loan losses  amounted to  $464,000  at  year-end.  While the Bank
maintains its  allowance for loan losses at a level which it considers  adequate
to  provide  for  potential  losses,  there can be no  assurances  that  further
additions  will not be made to the loan loss allowance and that such losses will
not exceed the estimated amounts.

NON-INTEREST INCOME

Total  non-interest  income  increased by $23,000 during 1999 when compared to
1998.

Service charges on deposits  increased  $16,000 mainly because of an increase in
chargeable  events  and  an  increase,   in  November,  in  the  amount  of  the
non-sufficient funds charge.

The  decrease  in the gain on the sale of loans of  $22,000  was the result of a
decrease in the dollar amount of loans sold.

The Bank sold  available for sale  securities  in 1999 and  recognized a gain of
$4,000 while securities sold in the previous year produced gains of $81,000.

The  increase  in other  income was the result of the  disposition  of  property
acquired in 1992 by way of a foreclosure of an office building. The property was
assigned to the Bank per a deficiency judgement and was subsequently redeemed by
the  borrower in 1999 at which time the Bank  recognized a gain in the amount of
$97,000.


                                                                               6
<PAGE>


NON-INTEREST EXPENSE

Overall, non-interest expense increased $94,000 during 1999.

Compensation and benefits  increased by $48,000 in 1999 and was primarily caused
by the hiring of  additional  staff.  The increase in personnel was necessary to
support the growth of commercial and agricultural lending and the opening of the
new branch in Cheyenne, Wyoming.

Occupancy and equipment  expense  increased  $11,000 and was primarily caused by
increases  in  utilities,  telephone,  and building  and  equipment  repairs and
maintenance.

Other  expenses  increased  by $35,000  when  compared to the same period of the
previous year. The increase in expenses was mainly caused by increased marketing
expenses regarding the introduction and development of new and existing loan and
deposit  products  and to inform the Bank's  customers  of its efforts to become
fully Year 2000 compliant.  The Bank also had increases in professional expenses
and supplies.

The Bank has  undertaken a project to open a third office in Cheyenne,  Wyoming.
Non-interest  expense will increase as a result of the staffing and equipping of
this office  which is expected to open in April 2000.  A reduction in net income
(and possibly losses) compared to prior periods is expected as a result of these
expenses  until the new  office  results  in higher  overall  levels of loan and
deposit activity to offset the additional expenses.  The Bank believes that this
expansion  should  enhance  shareholder  value and hopes  that the  decrease  in
earnings  will not be as great  following  the end of 2001.  This  statement  of
beliefs  concerning the expansion is a forward  looking  statement.  The Private
Securities  Litigation  Reform Act of 1995 (the "Act")  provides  protection  to
Tri-County in making certain forward looking  statements that are accompanied by
the  factors  that could  cause  actual  results to differ  materially  from the
forward  looking  statement.  As  with  any  expansion,  if the  new  office  or
additional  personnel do not  ultimately  result in  increased  loan and deposit
activity and  increased net income,  these  expenses  would  continue to have an
adverse affect on net income past the end of year 2001.

INCOME TAXES

The  provision  for income taxes  decreased by $49,000.  The main reason for the
decrease in income taxes was the decrease in income before taxes of $193,000.

YEAR 2000

Like many financial  institutions,  we rely on computers to conduct our business
and  information  systems  processing.  Industry  experts were concerned that on
January 1, 2000,  some  computers  might not be able to  interpret  the new year
properly,  causing computer  malfunctions.  Some banking industry experts remain
concerned that some computers may not be able to property  interpret  additional
dates in the year 2000. We have  operated and  evaluated our computer  operating
systems since January 1, 2000 and have not  identified any errors or experienced
any computer  system  malfunctions.  We will continue to monitor our information
systems to assess whether they are at risk of  misinterpreting  any future dates
and will develop  appropriate  contingency plans to prevent any potential system
malfunction or correct any system failures. The Company has not been informed of
any such problem experienced by its vendors or its customers,  nor by any of the
municipal agencies that provide services to the Company.

                                                                               7
<PAGE>

Nevertheless,  it is too soon to  conclude  that there will not be any  problems
arising  from the  Year  2000  problem,  particularly  at some of the  Company's
vendors.  The Company will continue to monitor its significant  vendors of goods
and services  with  respect to Year 2000  problems  they may  encounter as those
issues may effect the Company's  financial  position,  results of operations and
cash  flows.  The  Company  does not  believe at this time that these  potential
problems  will  materially  impact the ability of the  Company to  continue  its
operations, however, no assurance can be given that this will be the case.

The  expectations  of the  Company  contained  in this  section on Year 2000 are
forward-looking   statements  within  the  meaning  of  the  Private  Securities
Litigation  Reform Act of 1995 and involve  substantial  risks and uncertainties
that may cause actual results to differ  materially  from those indicated by the
forward-looking  statements.  All forward-looking statements in this section are
based on information available to the Company on the date of this document,  and
the Company assumes no obligation to update such forward-looking statements.

IMPACT OF INFLATION AND CHANGING PRICES

The financial  statements  of the Bank and notes  thereto,  presented  elsewhere
herein,  have been prepared in accordance  with  generally  accepted  accounting
principles,  which require the  measurement of financial  position and operating
results in terms of historical  dollars  without  considering  the change in the
relative purchasing power of money over time and due to inflation. The impact of
inflation is reflected in the increased cost of the Bank's operations.

Unlike most  industrial  companies,  nearly all of the assets and liabilities of
the Bank are monetary. As a result,  interest rates have a greater impact on the
Bank's performance than do the effects of general levels of inflation.  Interest
rates do not necessarily move in the same direction or to the same extent as the
price of goods and service.

                                                                               8
<PAGE>







         Board of Directors
         Tri-County Bancorp, Inc. and Subsidiaries


         REPORT OF INDEPENDENT AUDITORS


         We have audited the accompanying  consolidated  statements of financial
         condition of Tri-County Bancorp, Inc. and Subsidiaries  (Tri-County) as
         of December 31, 1999 and 1998, and the related consolidated  statements
         of operations,  stockholders'  equity and cash flows for the years then
         ended. These consolidated  financial  statements are the responsibility
         of Tri-County'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 consolidated financial
         statements  are  free  of  material  misstatement.  An  audit  includes
         examining,  on a  test  basis,  evidence  supporting  the  amounts  and
         disclosures in the  consolidated  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 consolidated  financial
         condition of Tri-County  Bancorp,  Inc. and Subsidiaries as of December
         31, 1999 and 1998, and the consolidated results of their operations and
         their cash flows for the years then ended, in conformity with generally
         accepted accounting principles.




         /s/DALBY, WENDLAND & CO., P.C.
         Grand Junction, Colorado

         February 4, 2000


                                                                               9
<PAGE>

                  TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES

                CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

                                                               December 31,
                                                            1999         1998
                                                       -----------   -----------
                       ASSETS

Cash and due from banks                                 $1,187,935   $  385,804
Interest-bearing deposits with banks                     1,128,404    2,979,241
Securities available for sale, at fair value            27,238,804   28,727,466
Securities held to maturity                              7,237,691    5,335,700
Loans held for sale, at market value                             -      435,721
Loans receivable, net of allowance for loan losses
of $464,453 (1999) and $409,984 (1998)                  48,979,883   42,054,222
Accrued interest receivable                                642,561      450,017
Bank property and equipment                              2,028,288      801,141
Other assets                                                72,270      138,685
                                                            ------      -------
   Total Assets                                        $88,515,836  $81,307,997
                                                       ===========  ===========

        LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
   Demand deposits                                       $ 997,117   $  690,177
   NOW accounts                                          7,612,597    5,776,145
   Savings accounts                                      8,611,853    8,737,500
   Other time deposits                                  34,587,587   30,770,264
                                                        ----------   ----------
   Total Deposits                                       51,809,154   45,974,086

Advances from Federal Home Loan Bank                    25,558,367   23,799,117
Accounts payable and accrued expenses                      370,245      216,841
Advances by borrowers for taxes and insurance              115,691      110,167
Deferred income taxes                                      411,587      787,119
                                                           -------      -------
   Total Liabilities                                    78,265,044   70,887,330
                                                        ==========   ==========

Stockholders' Equity
   Preferred stock, $.10 par value, 5,000,000 shares
     authorized, none issued                                     -            -
   Common stock,  $.10 par value, 10,000,000 shares
    authorized, 1,548,611 (1999) and 1,520,425
    (1998) shares issued                                   154,861      152,043
   Additional paid-in capital                            7,530,906    7,319,578
   Retained earnings - substantially restricted          9,663,761    9,260,742
   Unearned compensation relating to Employee Stock
     Ownership Plan                                       (224,250)    (284,050)
   Accumulated other comprehensive income                  272,904    1,106,701
   Treasury stock - 642,377 (1999) and 641,627
   (1998) shares, at cost                               (7,147,390)  (7,134,347)
                                                        ----------   ----------
   Total Stockholders' Equity                           10,250,792   10,420,667
                                                        ----------   ----------
   Total Liabilities and Stockholders' Equity          $88,515,836  $81,307,997
                                                       ===========  ===========




                           See accompanying notes.
                                                                              10

<PAGE>


<TABLE>
<CAPTION>
                  TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES

                    CONSOLIDATED STATEMENTS OF OPERATIONS

                                                                Years ended December 31,
                                                                  1999              1998
                                                                  ----              ----
<S>                                                         <C>                 <C>
INTEREST INCOME
   Interest and fees on loans                               $3,680,585          $3,465,184
   Interest and dividends on available for sale securities
     Taxable interest                                        1,633,720           1,957,415
     Dividends                                                 147,042             141,048
   Interest on held to maturity securities
     Taxable interest                                          387,646             498,712
      Nontaxable interest                                       10,496               5,611
   Other interest earning assets                                63,677             105,045
                                                                ------             -------
   Total Interest Income                                     5,923,166           6,173,015
                                                             ---------           ---------
INTEREST EXPENSE
   Deposits                                                  2,034,069           2,052,506
   Advances                                                  1,383,889           1,493,513
                                                             ---------           ---------
   Total Interest Expense                                    3,417,958           3,546,019
                                                             ---------           ---------
   Net Interest Income                                       2,505,208           2,626,996
PROVISION FOR LOAN LOSSES                                            -                   -
                                                                 -----               -----
   Net Interest Income After Provision for Loan Losses       2,505,208           2,626,996
                                                             ---------           ---------
NONINTEREST INCOME
   Service charges on deposits                                 134,999             119,371
   Gain on sale of loans                                        42,869              65,085
   Gain on sale of investments available for sale                3,696              80,940
   Other income                                                131,646              25,296
                                                               -------              ------
   Total Noninterest Income                                    313,210             290,692
                                                               -------             -------
NONINTEREST EXPENSE
   Compensation and benefits                                   960,059             911,667
   Occupancy and equipment                                     329,363             318,803
   Federal insurance premiums                                   27,200              27,921
   Other expenses                                              340,974             305,620
                                                               -------             -------
   Total Noninterest Expense                                 1,657,596           1,564,011
                                                             ---------           ---------
   Income Before Income Taxes                                1,160,822           1,353,677
PROVISION FOR INCOME TAXES                                     366,440             415,614
                                                               -------             -------
   Net Income                                                $ 794,382           $ 938,063
                                                             =========           =========

EARNINGS PER SHARE
   Basic                                                       $   .90             $   .83
                                                               =======             =======
   Diluted                                                     $   .85             $   .78
                                                               =======             =======

                            See accompanying notes.

</TABLE>
                                                                              11
<PAGE>
<TABLE>
<CAPTION>
                    TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

                 For the years ended December 31, 1999 and 1998

                                                                 Accumulated
                                                                   Other                                        Employee     MSBP
                                                                   Compre-              Additional                Stock    Unearned
                                        Comprehensive  Retained    hensive      Common    Paid-In   Treasury    Ownership   Compen-
                                Total       Income     Earnings  Income(loss)    Stock    Capital     Stock        Plan     sation
                                -----       ------     --------  ------------    -----    -------     -----        ----     ------
<S>                         <C>          <C>          <C>         <C>          <C>      <C>        <C>          <C>        <C>
Balance-December 31, 1997   $13,827,184               $8,792,947     $817,476  $149,500 $7,100,600 $(2,645,314) $(343,850) $(44,175)
Comprehensive income
   Net earnings                 938,063     $ 938,063    938,063            -         -          -           -          -         -
    Unrealized gain on
    securities, net of tax
    and reclassification
    adjustment                  289,225       289,225          -      289,225         -          -           -          -         -
                                              -------
   Comprehensive income                    $1,227,288
                                           ==========
Repayment of ESOP debt           59,800                        -            -         -          -           -     59,800         -
Allocation of ESOP shares        94,395                        -            -         -     94,395           -          -         -
Amortization of deferred
 compensation                    44,175                        -            -         -          -           -          -    44,175
Stock options exercised         127,126                        -            -     2,543    124,583           -          -         -
Dividends paid - cash          (470,268)                (470,268)           -         -          -           -          -         -
Treasury stock purchased     (4,489,033)                       -            -         -          -  (4,489,033)         -         -
                              ---------                  -------      -------     -----    -------   ---------     ------    ------
Balance-December 31, 1998    10,420,667                9,260,742    1,106,701   152,043  7,319,578  (7,134,347)  (284,050)        -
Comprehensive income (loss)
   Net earnings                 794,382     $ 794,382    794,382            -         -          -           -          -         -
    Unrealized (loss) on
    securities, net of tax
    and reclassification
    adjustment                 (833,797)     (833,797)         -     (833,797)        -          -           -          -         -
                                              -------
   Comprehensive (loss)                     $ (39,415)
                                            =========
Repayment of ESOP debt           59,800                        -            -         -          -           -     59,800         -
Allocation of ESOP shares        73,217                        -            -         -     73,217           -          -         -
Stock options exercised         140,929                        -            -     2,818    138,111           -          -         -
Dividends paid - cash          (391,363)                (391,363)           -         -          -           -          -         -
Treasury stock purchased        (13,043)                       -            -         -          -     (13,043)         -         -
                                 ------                  -------      -------     -----    -------      ------     ------    ------
Balance-December 31, 1999   $10,250,792               $9,663,761     $272,904  $154,861 $7,530,906 $(7,147,390) $(224,250)   $    -
                 === ====   ===========               ==========     ========  ======== ========== ===========  =========    ======

                            See accompanying notes.
</TABLE>
                                                                              12
<PAGE>


                  TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                        Years ended December 31,
                                                             1999        1998
                                                             ----        ----
OPERATING ACTIVITIES
Net income                                               $ 794,382    $ 938,063
Adjustments to reconcile net income to net cash
provided by operations
   Depreciation and amortization                           168,596      134,794
   Provision for deferred taxes                             54,000      (23,000)
   Gain on sale of securities available for sale            (3,696)     (80,940)
   Gain on sale of loans                                   (42,869)     (65,085)
   FHLB stock dividends received                          (132,800)    (128,500)
   Unvested forfeitable stock awarded                            -       44,175
   Changes in assets and liabilities
    Origination of loans held for sale                  (3,109,995)  (3,862,039)
    Proceeds from sale of loans held for sale            3,588,584    3,608,514
    Accrued interest receivable                           (192,544)     205,322
    Other assets, net                                      153,216      556,952
    Other liabilities, net                                 136,320       70,254
                                                           -------       ------
    Net Cash Provided By Operations                      1,413,194    1,398,510
                                                         ---------    ---------
INVESTING ACTIVITIES
Net loan origination and principal repayments on        (1,505,741)   4,594,499
loans
Purchase of loans                                       (5,439,723)  (6,210,552)
Activity in available for sale securities
   Sale proceeds                                         3,440,721    3,129,251
   Maturities, prepayments and calls                     6,392,460   18,164,932
   Purchases                                            (9,499,420) (12,906,090)
Activity in held to maturity securities
   Maturities, prepayments and calls                     2,093,251    2,830,392
   Purchases                                            (3,998,975)    (177,000)
Proceeds from sale of real estate owned                          -       23,966
Investment in property, equipment and real estate
owned                                                   (1,340,639)     (29,627)
                                                        ----------      -------
   Net Cash Provided (Used) By Investing Activities    $(9,858,066)  $9,419,771
                                                       -----------   ----------

                                                                              13
<PAGE>

FINANCING ACTIVITIES
Net change in noninterest-bearing demand, savings
   and NOW deposits                                     $2,017,744   $2,158,365
Net change in time deposits                              3,817,324   (1,589,432)
Advances from Federal Home Loan Bank                    15,975,000   12,500,000
Repayment of Federal Home Loan Bank advances           (14,215,750) (18,397,500)
Net change in advances by borrowers for taxes and
   insurance                                                 5,525        8,901
Dividends paid                                           (391,363)     (470,268)
Exercise of stock options                                  140,929      127,126
ESOP payments received                                      59,800       59,800
Purchase of treasury stock                                 (13,043)  (4,489,033)
                                                           -------   ----------
   Net Cash Provided (Used) by Financing Activities      7,396,166  (10,092,041)
                                                         ---------  -----------
   Increase (Decrease) in Cash and Cash Equivalents     (1,048,706)     726,240
Cash and cash equivalents - beginning of period          3,365,045    2,638,805
                                                         ---------    ---------
Cash and cash equivalents - end of period               $2,316,339   $3,365,045
                                                        ==========   ==========

Cash and due from banks                                 $1,187,935    $ 385,804
Interest-bearing deposits with banks                     1,128,404    2,979,241
                                                         ---------    ---------
                                                        $2,316,339   $3,365,045
                                                        ==========   ==========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
   Cash paid for
    Income taxes                                         $ 255,400    $ 438,600
                                                         =========    =========
    Interest expense                                    $3,414,338   $3,565,230
                                                        ==========   ==========
   Noncash transactions
    Loans transferred to real estate owned              $        -    $  23,966
                                                        ==========    =========


                           See accompanying notes.

                                                                              14
<PAGE>


                  TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          December 31, 1999 and 1998


NOTE 1 -   NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNT POLICIES

Tri-County Bancorp,  Inc. (Tri-County) is a bank holding company organized under
Wyoming  law in 1993 and  headquartered  in  Torrington,  Wyoming.  Through  its
subsidiaries,  Tri-County provides a variety of banking services to customers in
its primary market area of eastern Wyoming.

Basis of Presentation
The consolidated  financial  statements include the accounts of Tri-County,  its
wholly-owned  subsidiaries,  Tri-County  Bank (the  Bank)  and First  Tri-County
Services,  Inc. The  investment in the  subsidiaries  is accounted for using the
equity  method  of  accounting.   All  significant   intercompany  accounts  and
transactions have been eliminated in consolidation. Certain prior period amounts
have been reclassified to conform with the current year's presentation.

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

Cash and Cash Equivalents
For the purpose of reporting cash flows, cash and cash equivalents  include cash
on hand, demand deposits at other financial institutions and overnight deposits.

Securities
Securities  that  Tri-County has both the positive intent and ability to hold to
maturity  are  classified  as  securities  held to  maturity  and are carried at
amortized  cost,  adjusted for  amortization of premium or accretion of discount
using the  interest  method.  Securities  that may be sold prior to maturity for
asset/liability  management purposes, or that may be sold in response to changes
in interest rates, to changes in prepayment risk, to increase regulatory capital
or other similar  factors,  are classified as securities  available for sale and
carried at fair value with any adjustments to fair value, after tax, reported as
a separate  component  of  stockholders'  equity.  Declines in the fair value of
individual held to maturity and available for sale securities  below their cost,
that  are  other  than  temporary,  result  in  write-downs  of  the  individual
securities to their fair value. The related write-downs are included in earnings
as realized  losses.  Securities  purchased for trading purposes are held in the
trading  portfolio  at fair  value,  with  changes  in fair  value  included  in
noninterest income. Tri-County had no trading securities at December 31, 1999 or
1998, or during the years then ended.

Interest and dividends on securities, including the amortization of premiums and
the accretion of discounts, are reported in interest and dividends on securities
using the  interest  method.  Gains and  losses  on the sale of  securities  are
recorded on the trade date and are calculated using the  specific-identification
method.


                                                                              15
<PAGE>


Federal Home Loan Bank Stock
The Bank,  as a member of the  Federal  Home Loan Bank  (FHLB),  is  required to
maintain an  investment in capital stock of the FHLB. No ready market exists for
the FHLB stock,  and it has no quoted market value. The stock is carried at cost
and is  assumed  to have a market  value  which is equal to cost.  The  stock is
included  in  securities  available  for sale in the  accompanying  consolidated
financial statement.

Loans Held for Sale
Mortgage  loans  originated  and intended for sale in the  secondary  market are
carried at the lower of cost or  estimated  market value in the  aggregate.  Net
unrealized losses are recognized in a valuation allowance by a charge to income.
The  cost of loans  held  for  sale at  December  31,  1998  approximated  their
estimated market value.

Servicing
The Bank sells  certain  loans to the  Federal  Home Loan  Mortgage  Corporation
(FHLMC) with servicing  retained.  Capitalized  servicing rights are reported in
other assets and are amortized  into  noninterest  income in proportion  to, and
over the period of  estimated  net  servicing  revenue.  Impairment  of mortgage
servicing  rights is assessed at each  reporting date based on the fair value of
those rights.  Fair values are estimated using  discounted cash flows based on a
current market interest rate. For purposes of measuring  impairment,  the rights
are  stratified  by loan  type and  interest  rate.  The  amount  of  impairment
recognized,   through  a  valuation  allowance,  is  the  amount  by  which  the
capitalized mortgage servicing rights for a stratum exceed their fair value.

Loans
Loans that  management  has the intent and  ability to hold for the  foreseeable
future or until  maturity or pay-off  generally  are  reported at the  principal
amount outstanding,  net of deferred loan fees, discounts, and the allowance for
loan losses. Interest on loans is calculated by using the simple interest method
on the balance of the principal  amount  outstanding.  Interest  income on loans
receivable  is accrued as earned  based on the  principal  balance  outstanding.
Tri-County discontinues the accrual of interest when the related loan is 90 days
delinquent. Net direct loan origination costs/fees,  when material, are deferred
and amortized over the term of the loan as a yield adjustment.

The accrual of interest on impaired loans is discontinued  when, in management's
opinion,  the borrower may be unable to meet  payments as they become due.  When
interest accrual is discontinued,  all unpaid accrued interest is reversed,  for
impaired loans,  cash receipts are applied entirely against  principal until the
loan has been collected in full,  after which time any additional  cash receipts
are  recognized  as  interest  income.   Tri-County  had  no  significant  loans
considered impaired or on non-accrual status at December 31, 1999 or 1998.

Allowance for Loan Losses
The allowance  for loan losses  reflects  management's  judgment as to the level
considered  adequate to absorb  potential losses inherent in the loan portfolio.
This  judgment  is  based on a  review  of  individual  loans,  historical  loss
experience, economic conditions,  portfolio trends and other factors. Allowances
for impaired loans are generally  determined  based on collateral  values or the
present value of estimated cash flows.  The allowance is increased by provisions
charged to earnings and reduced by  charge-offs,  net of recoveries.  Changes in
the  allowance  relating  to  impaired  loans are  charged  or  credited  to the
provision for loan losses.  Because of uncertainties  inherent in the estimation
process,  management's  estimate of credit losses inherent in the loan portfolio
and the related allowance may change in the near term.

Property and Equipment
Property and equipment are recorded at cost.  Depreciation is provided using the
straight-line method over the estimated useful lives of the related assets.

                                                                              16
<PAGE>



Impairment of Long-Lived Assets
Loans are  considered  to be impaired and an  impairment  loss  recognized  when
expected  future cash flows are less than the asset's  carrying value. No assets
were considered impaired at December 31, 1999 or 1998.

Other Real Estate
Other real estate,  acquired through partial or total  satisfaction of loans, is
included  in other  assets  and  carried at the lower of cost or fair value less
estimated  costs of  disposition.  At the date of  acquisition,  any  losses are
charged to the allowance for loan losses. Subsequent write-downs are included in
noninterest  expense.  Realized  losses from  disposition  of the  property  and
declines in fair value that are considered  permanent are charged to the reserve
for other real estate, as applicable.

Income Taxes
Deferred tax assets and  liabilities  are reflected at currently  enacted income
tax  rates  applicable  to the  period  in which  the  deferred  tax  assets  or
liabilities  are  expected to be realized or settled.  As changes in tax laws or
rates are enacted,  deferred tax assets and liabilities are adjusted through the
provision for income taxes.

Stock Options
SFAS No. 123 (SFAS 123),  Accounting  for  Stock-Based  Compensation,  allows an
entity to choose to compute  compensation expense related to stock options using
a fair value  method or  continue  to use the  intrinsic  value  method.  If the
intrinsic  value method is chosen,  then  Tri-County will be required to present
pro forma data for all awards granted in future fiscal years.  If the fair value
method is selected, SFAS 123 would be effective.

Tri-County   had  no  stock   option   transactions   that  would   require  the
implementation  of SFAS 123 in the years ended December 31, 1999 and 1998. It is
currently  anticipated  that Tri-County will continue to account for stock-based
compensation plans under the intrinsic value method.  Final determination of the
method selected will be done in the year Tri-County has transactions  covered by
this accounting pronouncement.

Earnings Per Share
Basic  earnings per share  represents  income  available to each share of common
stock  outstanding  during the  reporting  period.  Diluted  earnings  per share
represents income available to each share of common stock outstanding during the
reporting period adjusted for the potential  issuance of common shares for stock
options.

The  calculation  of basic and  diluted  earnings  per share for the years ended
December 31 is as follows:


                                               1999            1998
                                               ----            ----

     Net income                              $794,382        $ 938,063
                                             ========        =========

     Average common shares outstanding        885,897        1,127,425
     Dilutive effect of stock options          50,303           74,227
                                               ------           ------
                                              936,200        1,201,652
                                              =======        =========
     Earnings per share
     Basic                                     $  .90          $   .83
     Diluted                                   $  .85          $   .78



                                                                              17
<PAGE>


New Accounting Standards
In June 1998, the Financial  Accounting  Standards  Board (FASB) issued SFAS No.
133 (SFAS 133),  Accounting for Derivative  Instruments and Hedging  Activities,
which establishes accounting and reporting standards for derivative instruments,
including certain derivative  instruments  embedded in other contracts,  and for
hedging  activities.  The effective date of SFAS 133 was deferred until June 15,
2000 with the issuance of SFAS No. 137.

The  adoption  of  SFAS  133 is  not  expected  to  have a  material  effect  on
Tri-County's financial statements.

NOTE 2 -   SECURITIES
<TABLE>
<CAPTION>
                                                                 Gross      Gross
                                                  Amortized   Unrealized  Unrealized    Fair
Securities Available for Sale                         Cost       Gains      Losses      Value
<S>                                              <C>          <C>         <C>         <C>
   December 31, 1999
   Debt Securities
     U.S. Agency securities                      $13,999,671       $   -   $(424,516) $13,575,155
     U.S. Agency mortgage-backed securities       10,379,986      24,521    (253,343)  10,151,164
                                                  ----------      ------    --------   ----------
       Total Debt Securities                      24,379,657      24,521    (677,859)  23,726,319
                                                  ----------      ------    --------   ----------
   Equity Securities
     FHLMC stock                                      22,871   1,076,415           -    1,099,286
     Mutual funds
       ARM portfolio                                 536,085           -      (9,586)     526,499
     FHLB stock                                    1,886,700           -           -    1,886,700
                                                   ---------   ---------      ------    ---------
        Total Equity Securities                    2,445,656   1,076,415      (9,586)   3,512,485
                                                   ---------   ---------      ------    ---------
                                                 $26,825,313  $1,100,936   $(687,445) $27,238,804
                                                 ===========  ==========   =========  ===========
   December 31, 1998
   Debt Securities
     U.S. Agency securities                       $5,497,441   $ 104,134        $  -   $5,601,575
     U.S. Agency mortgage-backed securities       15,803,325      70,322      (5,140)  15,868,507
                                                  ----------      ------      ------   ----------
       Total Debt Securities                      21,300,766     174,456      (5,140)  21,470,082
                                                  ----------     -------      ------   ----------
   Equity Securities
     FHLMC stock                                      23,459   1,520,335           -    1,543,794
     Mutual funds
       ARM portfolio                               1,036,085         505      (5,305)   1,031,285
       Mortgage securities performance portfolio   2,936,437           -      (8,032)   2,928,405
     FHLB stock                                    1,753,900           -           -    1,753,900
                                                   ---------   ---------       -----    ---------
     Total Equity Securities                       5,749,881   1,520,840     (13,337)   7,257,384
                                                   ---------   ---------     -------    ---------
                                                 $27,050,647  $1,695,296    $(18,477) $28,727,466
                                                 ===========  ==========    ========  ===========
</TABLE>

                                                                              18
<PAGE>
<TABLE>
<CAPTION>
                                                                Gross      Gross
                                                  Amortized  Unrealized  Unrealized      Fair
Securities Held-to-Maturity                           Cost      Gains      Losses       Value
<S>                                               <C>          <C>          <C>        <C>
   December 31, 1999
   U.S. Agency securities                         $2,000,000   $       -    $(19,690)  $1,980,310
   State and other political subdivisions            173,278           -           -      173,278
   U.S. Agency mortgage-backed securities          5,064,413      73,263     (14,155)   5,123,521
                                                   ---------      ------     -------    ---------
                                                  $7,237,691   $  73,263    $(33,845)  $7,277,109
                                                  ==========   =========    ========   ==========
   December 31, 1998
   U.S. Agency securities                          $ 501,286   $  13,089        $  -    $ 514,375
   State and other politicaL subdivisions            175,949           -           -      175,949
   U.S. Agency mortgage-backed securities          4,658,465     125,433           -    4,783,898
                                                   ---------     -------        ----    ---------
                                                  $5,335,700   $ 138,522        $  -   $5,474,222
                                                  ==========   =========        ====   ==========
</TABLE>
The  amortized  cost and fair value of debt  securities at December 31, 1999, by
contractual  maturity,  are shown below.  Expected  maturities  will differ from
contractual  maturities  because  borrowers may have the right to call or prepay
obligations with or without call or prepayment penalties.

<TABLE>
<CAPTION>
                                                  Available for Sale       Held to Maturity
                                                  ------------------       ----------------
                                                   Amortized    Fair       Amortized       Fair
                                                      Cost      Value         Cost         Value
                                                    ----        -----         ----         -----
<S>                                              <C>         <C>         <C>          <C>
   Due in one year or less                       $         - $         - $         -  $         -
   Due after one year through five years           8,000,000   7,782,125           -            -
   Due after five years through ten years          5,999,671   5,793,030     173,278      173,278
   Due after ten years                                     -           -   2,000,000    1,980,310
                                                   ---------   ---------   ---------    ---------
                                                  13,999,671  13,575,155   2,173,278    2,153,588
   Mortgage-backed securities                     10,379,986  10,151,164   5,064,413    5,123,521
                                                  ----------  ----------   ---------    ---------
                                                 $24,379,657 $23,726,319  $7,237,691   $7,277,109
                                                 =========== ===========  ==========   ==========
</TABLE>
Sales of  securities  available  for sale  during the years  ended  December  31
follows:

                                        Proceeds     Gross Gains   Gross Losses
                                        --------     -----------   ------------
   1999                                $3,440,721      $33,096      $(29,906)
   1998                                $3,129,251     $127,048      $(46,108)

Tri-County  pledges  investments  for public deposits held in excess of $100,000
(see Note 5).  The  carrying  and fair  values  of the  pledged  investments  at
December 31 follows:
                                                         Carrying      Fair
                                                          Value        Value
   1999                                                $11,751,071  $11,346,968
   1998                                                 $9,769,442   $9,830,029



                                                                              19
<PAGE>


NOTE 3 -   LOANS RECEIVABLE
                                                            December 31,
                                                          1999        1998
                                                          ----        ----
   Real estate - mortgage                             $34,657,019  $32,403,370
   Real estate - commercial                             7,070,295    6,141,006
   Real estate - agriculture                            2,580,403            -
   Real estate - construction                             564,900      414,250
   Commercial                                             810,791      449,949
   Installment loans to individuals                     4,033,212    3,310,068
                                                        ---------    ---------
                                                       49,716,620   42,718,643
   Less:
     Allowance for loan losses                           (464,453)    (409,984)
     Unadvanced loan funds                               (196,639)    (176,848)
     Deferred loan fees                                   (75,645)     (77,589)
                                                          -------      -------
                                                      $48,979,883  $42,054,222
                                                      ===========  ===========

A summary of the changes in the allowance for loan losses is as follows:

                                                      Years Ended December 31,
                                                            1999         1998
                                                            ----         ----
Beginning of the period                                  $409,984     $412,456
Provision for losses                                            -            -
Loan charge-offs                                          (16,101)      (2,738)
Recoveries                                                 70,570          266
                                                           ------          ---
                                                         $464,453     $409,984
                                                         ========     ========

Loans  serviced  for others are not  included in the  accompanying  consolidated
statements of financial  condition.  The unpaid  principal  balances of mortgage
loans  serviced  for others at December 31 were  $2,492,400  (1999) and $586,000
(1998). The balance of capitalized rights, net of valuation allowances, included
in other assets at December 31 was $14,599 (1999) and $3,692 (1998).

NOTE 4 -   PROPERTY AND EQUIPMENT

                                                             December 31,
                                                           1999          1998
                                                           ----          ----
   Land                                                 $ 791,634     $ 65,776
   Building and improvements                            1,115,984    1,115,984
   Furniture, fixtures and equipment                      654,367      614,764
   Construction-in-progress                               578,677            -
                                                          -------    ---------
                                                        3,140,662    1,796,524
   Less accumulated depreciation                       (1,112,374)    (995,383)
                                                       ----------     --------
                                                       $2,028,288    $ 801,141
                                                       ==========    =========

Depreciation  expense for the years ended December 31 was $116,991  (1999) and
$115,365 (1998).


                                                                              20
<PAGE>


NOTE 5 -   DEPOSITS

At December 31, 1999,  scheduled  maturities of  certificates of deposit were as
follows:

   Year
   ----
   2000                                                            $28,340,773
   2001                                                              5,078,502
   2002                                                                878,238
   2003                                                                290,074
                                                                       -------
                                                                   $34,587,587
                                                                   ===========

The  Federal  Deposit  Insurance  Corporation  (FDIC),  an  agency  of the  U.S.
Government,  insures all depositors up to $100,000 in accordance  with the rules
and regulations of the FDIC.  Deposits in excess of $100,000 at December 31 were
$8,760,495 (1999) and $5,200,407 (1998) (see Note 2).

NOTE 6 -   ADVANCES FROM FEDERAL HOME LOAN BANK

Advances from the FHLB at December 31 were  $25,558,367  (1999) and  $23,799,117
(1998). The following table summarizes the maturities of the FHLB advances:


   Year
   ----
   2000                                              4.71% - 6.08%  $7,225,000
   2001                                              5.39% - 6.74%   5,550,000
   2002                                                      5.59%   2,000,000
   2003                                                      5.10%   1,000,000
   2004                                              4.97% - 5.45%   5,000,000
   Thereafter                                        5.45% - 6.13%   4,783,367
                                                                    ----------
                                                                   $25,558,367
                                                                   ===========

Pursuant to a blanket  pledge  agreement with the FHLB, the advances are secured
by the FHLB stock, real estate loans and other securities not otherwise pledged.

NOTE 7 -   INCOME TAXES

The provisions for federal income taxes are as follows:

                                                        Years ended December 31,
                                                            1999         1998
                                                            ----         ----
   Current                                               $312,440     $438,614
   Deferred                                                54,000      (23,000)
                                                           ------      -------
                                                         $366,440     $415,614
                                                         ========     ========



                                                                              21
<PAGE>


Deferred  income taxes and benefits  are  provided  for  significant  income and
expense  items  recognized in different  years for tax and  financial  reporting
purposes.  Temporary  differences  which give rise to  significant  deferred tax
assets (liabilities) follow:


                                                               December 31,
                                                            1999        1998
                                                            ----        ----
   Joint venture income                                     $   -     $ 32,000
   Loan origination fees                                    1,278        4,000
   Bad debt reserve                                       159,722      139,000
   Net unrealized loss on available for sale securities   225,394        4,300
   Less: valuation allowance                                    -            -
                                                          -------      -------
                               Total Deferred Assets      386,394      179,300
                                                          -------      -------
   Federal Home Loan Bank stock dividends                (412,046)    (366,900)
   Net unrealized gain on available for sale securities  (365,981)    (574,482)
   Accelerated depreciation                               (19,954)     (25,037)
                                                          -------      -------
                          Total Deferred Liabilities     (797,981)    (966,419)
                                                         --------     --------
                            Net Deferred Liabilities    $(411,587)   $(787,119)
                                                        =========    =========

Total income tax expense differed from the amounts computed by applying the U.S.
federal  income tax rate of 34 percent in 1999 and 1998 to income  before income
taxes as a result of the following:

                                                       Years ended December 31,
                                                           1999         1998
                                                           ----         ----
   Normal "expected" corporate taxes                     $392,350     $460,250
   Change in tax provision resulting from
     Income tax refunds                                   (17,000)     (15,500)
     Other                                                 (8,910)     (29,136)
                                                           ------      -------
                                                         $366,440     $415,614
                                                         ========     ========

Tri-County and its subsidiaries file a consolidated income tax return. Excess of
bad debt  reserves for income tax purposes  over book  provision for the Bank at
December  31,  1999  were  approximately  $1,453,000.  No  deferred  income  tax
liability  has been provided for these  reserves.  If such reserves are used for
purposes  other than to absorb the Bank's bad debts,  the amount used is subject
to the then current federal corporate tax rates. Tri-County and its subsidiaries
are not subject to state income taxes.

NOTE 8 -   RELATED PARTY TRANSACTIONS

Tri-County  has  had,  and may be  expected  to have  in the  future,  financial
transactions  in the  ordinary  course of  business  with  directors,  principal
officers,  their immediate  families and affiliated  companies in which they are
principal  stockholders  (commonly referred to as related parties), all of which
have been made in compliance with federal regulations.

Activity  in loans to related  parties  for the years  ended  December  31 is as
follows:

                                                           1999         1998
                                                           ----         ----
   Balance, beginning of year                            $159,494     $147,593
     New loans                                            266,112       91,420
     Repayments                                          (290,318)     (79,519)
                                                         --------      -------
   Balance, end of year                                  $135,288     $159,494
                                                         ========     ========

                                                                              22
<PAGE>
Terms and rates of interest on deposit  accounts of  directors  and officers are
substantially the same as those extended to unrelated Tri-County  customers.  At
December  31  deposits  of  related   parties   totaled   $299,582   (1999)  and
$436,815(1998).

NOTE 9 -   EMPLOYEE RETIREMENT PLAN

Tri-County  sponsors  a 401(k)  plan  where  Tri-County  matches up to 3% of the
employees qualifying  compensation.  Employees may contribute up to 10% of their
qualifying  compensation.  Tri-County's  expense was $19,686  (1999) and $18,489
(1998).

NOTE 10 -  STOCK REPURCHASE PLAN

On October 16, 1998,  the board of directors  of  Tri-County  authorized a stock
repurchase  plan (the Plan).  The Plan  provided  for the purchase of up to $4.5
million (including  expenses) of the shares of its common stock, $0.10 par value
for cash. On December 9, 1998, the Plan  culminated with the purchase of 314,125
shares at $14 per share.  Including  expenses,  $4,489,033  was  recorded in the
accompanying  consolidated  statement of stockholders'  equity as an addition to
Treasury Stock. In 1999, the board of directors  authorized  stock repurchase on
an individual transaction basis. The Company repurchased 750 shares for $13,043.

NOTE 11 -  STOCK BENEFIT PLANS

Stock Option Plan
Tri-County  adopted a stock option plan (Option  Plan)  whereby stock options of
149,500  common  shares may be granted to  directors  and  officers of the Bank.
Options  granted  under the Option Plan may be either  options  that  qualify as
Incentive  Stock Options as defined in Section 422 of the Internal  Revenue Code
of 1986, as amended, or options that do not qualify. In the event of a change in
control, as defined, all options are immediately exercisable.

On September 28, 1993,  qualified stock options were granted for the purchase of
143,522  shares  exercisable  at the market price at the date of grant of $5 per
share.  All  options  expire ten years from the date of the grant.  The  options
vested over a 5 year period.

A summary of Tri-County's Option Plan as of December 31 follows:


                                                    1999                 1998
                                                    ----                 ----
                                                      Exercise         Exercise
                                               Shares  Price    Shares  Price
                                               ------  ------   ------  -----
Outstanding, beginning of the year            118,097  $5.00   143,522  $5.00
Granted                                             -      -         -      -
Exercised                                     (28,186) $5.00   (25,425) $5.00
Canceled                                            -      -         -      -
                                               ------           ------
Outstanding, end of the year                   89,911  $5.00   118,097   $5.00
                                               ======          =======
Options exercisable at the end of the year     89,911  $5.00   118,097   $5.00

Employee Stock Ownership Plan
Tri-County  sponsors  an  employee  stock  ownership  plan  (ESOP)  that  covers
substantially all employees.  Tri-County issued stock for a note receivable from
the ESOP, which is unconditionally  guaranteed by the Bank. The note is at prime
(determined at the beginning of each  quarter),  payable  quarterly  through the
third quarter of 2003 and is included in the accompanying consolidated financial
statements as a reduction in stockholders' equity. At December 31 the balance of
the note was $224,250 (1999) and $284,050 (1998).

                                                                              23
<PAGE>

The ESOP loan payments are provided by the Bank's  contributions to the ESOP and
by dividends received on Tri-County's stock held by the ESOP's trustee.  Through
the second  quarter of 1999,  the Bank's  ESOP  contributions  were based on the
note's  scheduled  principal  and  interest  payments,  net of  Tri-County  cash
dividends received. Beginning with the third quarter of 1999, Tri-County's board
of directors elected to have dividends  received by the ESOP allocated  directly
to plan participants.

The shares held by the ESOP are released in the proportion each year's principal
payment bears to the total principal payments. Released stock is allocated based
on the ratio of each participating employee's eligible compensation to the total
eligible compensation. Currently, shares are released at 11,960 shares per year.

The Bank's ESOP  contributions are recorded as compensation  expense and totaled
$117,372  (1999) and $133,524  (1998).  Dividends  used to satisfy note payments
were $38,419 (1999) and $51,428  (1998).  As of December 31 the ESOP held 44,850
(1999) and 56,810 (1998) unallocated  shares. The unallocated shares' fair value
at December 31 (based on NASDAQ) was $464,601 (1999) and $704,444 (1998).

Management Stock Bonus Plan
Tri-County  and the Bank adopted a management  stock bonus plan (MSBP) to enable
the  Bank to  attract  and  retain  experienced  and  capable  personnel  in key
positions of  responsibility.  A total of 59,800 shares of restricted stock were
awarded on September 28, 1993,  the  conversion  date, in the form of restricted
stock payable over a five-year vesting period, at 20 percent per year, beginning
September 28, 1994. Tri-County recognized  compensation expense in the amount of
the fair market  value of the common  stock at the grant date,  prorata over the
years during which the shares were payable. The unvested shares were entitled to
all  voting  and  other  stockholder  rights,  except  that  the  shares,  while
restricted,  cannot be sold,  pledged or otherwise disposed of, and are required
to be held in escrow.

Through December 31, 1997, unamortized deferred compensation related to the MSBP
is deducted from stockholders'  equity. As of December 31, 1998, all MSBP shares
were distributed and all deferred compensation expense recognized.

NOTE 12 -   REGULATORY CAPITAL

The Bank 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. These actions, if undertaken, could have a direct material effect on
the Bank's  financial  statements.  Under capital  adequacy  guidelines  and the
regulatory  framework  for prompt  corrective  action,  banks must meet specific
capital  guidelines  that involve  quantitative  measures of the Bank's  assets,
liabilities,  and certain off-balance sheet items as calculated under regulatory
accounting  practices.  Bank's  capital  amounts  and  classifications  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 banks to maintain minimum amounts and ratios of total and Tier 1 capital
(as defined in the regulations) to risk-weighted assets (as defined). Management
believes  that,  as of December  31, 1999,  the Bank meets all capital  adequacy
requirements to which it is subject.

As of December 31, 1999, the most recent notification from applicable regulatory
agencies categorize the Bank as well capitalized under the regulatory  framework
for prompt corrective  action.  To be categorized as well capitalized,  the Bank
must maintain  minimum  ratios as set forth in the following  table  (amounts in
thousands):

                                                                              24
<PAGE>
<TABLE>
<CAPTION>
                                                                                 To Be Well
                                                                              Capitalized Under
                                                              For Capital     Prompt Corrective
                                               Actual      Adequacy Purposes  Action Provision
                                          -----------------------------------------------------
                                          Dollars  Ratio    Dollars  Ratio    Dollars  Ratio
                                          -------  -----    -------  -----    -------  -----
<S>                                       <C>      <C>      <C>      <C>      <C>      <C>
December 31, 1999
Total Capital (to risk-weighted assets)   $9,164   22.6%    $3,250    8.0%    $4,063   10.0%
Tier 1 Capital (to risk-weighted assets)  $8,216   20.2%    $1,625    4.0%    $2,438    6.0%
Tier 1 Capital (to adjusted total assets) $8,216    9.4%    $3,495    4.0%    $4,369    5.0%

December 31, 1998
Total Capital (to risk-weighted assets)   $8,717   25.1%    $2,783    8.0%    $3,479   10.0%
Tier 1 Capital (to risk-weighted assets)  $8,307   23.9%    $1,392    4.0%    $2,087    6.0%
Tier 1 Capital (to adjusted total assets) $8,307   10.4%    $3,195    4.0%    $3,993    5.0%

</TABLE>
NOTE 13 -  OFF-BALANCE SHEET ACTIVITIES

In the normal course of business,  Tri-County  enters into commitments to extend
credit with off-balance-sheet risk to meet the financing needs of its customers.
Commitments  to extend  credit are  agreements  to lend to a customer as long as
there  is  no  violation  of  any  condition   established  in  the  commitment.
Commitments  generally have fixed expiration dates or other termination  clauses
and may require  payment of a fee. As some  commitments  normally expire without
being drawn upon, the total  commitment  amount does not  necessarily  represent
future cash requirements.

Tri-County  evaluates each customer's credit worthiness on a case-by-case basis,
using the same credit policies in making commitments and conditional obligations
as it does for on-balance-sheet  instruments.  The amount and type of collateral
obtained,  if deemed necessary by Tri-County upon extension of credit,  is based
upon management's  credit  evaluation.  Tri-County's  underwriting  policies for
mortgage  loans  generally  require  a  maximum  loan-to-value  of 80% for owner
occupied  residential  loans and 75% on non-owner  occupied  one-to-four  family
loans. Owner occupied  residential loans in excess of 80% are generally required
to obtain private mortgage insurance.

Tri-County had the following commitments at December 31, 1999:

Loan commitments                                       $1,680,490
Lines of credit                                        $1,677,701
Available overdraft protection                         $  193,666

The loan commitments ($299,819 fixed rate and $1,380,671 adjustable rate) are at
interest rates ranging from 6.27% to 8.5%. Tri-County's loan commitments include
commitments  to  purchase  loans  in  western  Colorado  ($387,000)  as  well as
commitments to extend credit to customers in Tri-County's market area.

Tri-County's market area primarily consists of eastern Wyoming.  Agriculture and
related support industries are a significant factor in the primary market area's
economy.

                                                                              25
<PAGE>

Tri-County  purchases  loans in other  market  areas  through  mortgage  banking
relationships.  The majority of the purchased  loans are in certain resort areas
of  Colorado  and Idaho.  These  loans  comprise  approximately  43% of the loan
portfolio.

NOTE 14 -  COMMITMENTS AND CONTINGENCIES

Construction-in-Progress
Tri-County is building a branch office in Cheyenne,  Wyoming and  anticipates it
will be completed in March 2000.  Construction  costs through  December 31, 1999
are included in the accompanying  consolidated  statement of financial  position
(see Note 4). Subsequent to December 31, 1999,  approximately  $178,000 in costs
have been incurred in the construction of the building.
Estimated cost to complete the building is $438,700.

Self-Insured Health Plan
The Bank sponsors a self-insured  health plan for eligible  employees.  The Plan
provides  for  payment by the Bank of health  claims up to $3,000  per  eligible
employee,  with  reinsurance  coverage for all claims  greater  than $3,000.  An
estimate of claims  incurred but not reported and claims reported but not funded
is included in accounts payable at December 31, 1999 and 1998.

Year 2000 Compliance
Tri-County  relies upon  computers for the daily conduct of its business and for
general data  processing.  Accordingly,  a Year 2000 Contingency Plan (the Plan)
was  developed  and  implemented  by the Bank to address year 2000  issues.  The
Bank's ability to process data and provide  financial  services and products was
unaffected  by the change to the year 2000.  The Plan  identified  dates  beyond
January 1, 2000 as potential problem dates; therefore, the Bank is continuing to
monitor these dates. It is the Bank's assertion that its plan and procedures are
adequate to mitigate any adverse outcomes.

Other
In the normal  course of  business,  Tri-County  is  involved  in various  legal
actions  arising from its lending and collection  activities.  In the opinion of
management, the outcome of these legal actions will not significantly affect the
consolidated financial position of Tri-County.

NOTE 15 -  STOCKHOLDERS' EQUITY

In 1993,  Tri-County was formed when the Bank converted from a mutual to a stock
form of ownership.  A  "liquidation  account" was  established  that restricts a
portion of net worth for the benefit of deposit accounts at the Bank at the time
of the  conversion.  Eligible  account  holders who close their accounts cause a
corresponding reduction in the liquidation account. Except for the repurchase of
stock,  payment of dividends  and  complete  liquidation,  the  existence of the
account does not restrict the use of the Bank's net worth. At December 31, 1999,
the liquidation account was $1,328,247 as compared to $6,432,095 at inception.

Payment  of  dividends  to  Tri-County  by the Bank  are  subject  to the  above
restriction as well as various other regulatory restrictions and approvals.

                                                                              26
<PAGE>

NOTE 16 -   COMPREHENSIVE INCOME

Effective  January  1,  1998,   Tri-County   adopted  SFAS  No.  130,  Reporting
Comprehensive Income. SFAS 130 requires that an enterprise (a) classify items of
other  comprehensive  income by their  nature in a financial  statement  and (b)
display the accumulated  balance of other  comprehensive  income separately from
retained  earnings and  additional  paid-in  capital in the equity  section of a
statement of financial condition.  Tri-County's only item of other comprehensive
income is the unrealized gain (loss) on securities  available for sale, which is
reported net of tax effect.  The  following  schedule  reflects  the  unrealized
holding gains arising during the years ended December 31, 1999 and 1998:

<TABLE>
<CAPTION>

                                                                     Before-Tax   Tax (Expense)   Net-of-Tax
                                                                       Amount      or Benefit       Amount
                                                                       ------      ----------       ------
<S>                                                                  <C>             <C>          <C>
1999
Unrealized holding losses arising during the period                  $(1,259,632)    $ 428,274    $(831,358)
Less reclassification adjustment for gains realized in net earnings       (3,696)        1,257       (2,439)
                                                                          ------         -----       ------
                  Net Unrealized Losses                              $(1,263,328)    $ 429,531    $(833,797)
                                                                     ===========     =========    =========

1998
Unrealized holding gains arising during the period                     $ 519,159     $(176,514)    $342,645
Less reclassification adjustment for gains realized in net earnings      (80,940)       27,520      (53,420)
                                                                         -------        ------      -------
                  Net Unrealized Gains                                 $ 438,219     $(148,994)    $289,225
                                                                       =========     =========     ========
</TABLE>
NOTE 17 -   FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair value is the amount at which a financial instrument could be exchanged in a
current  transaction  between  willing  parties,  other than in a forced sale or
liquidation, and is best evidenced by a quoted market price, if one exists.

Fair  value  estimates  are made as of a  specific  point  in time  based on the
characteristics  of the financial  instruments and relevant market  information.
Where available,  quoted market prices are used. In other cases, fair values are
based on estimates  using present  value or other  valuation  techniques.  These
techniques  involve   uncertainties  and  are  significantly   affected  by  the
assumptions  used and judgments made regarding risk  characteristics  of various
financial  instruments,  discount rates,  estimates of future cash flows, future
expected  loss  experience  and other  factors.  Changes  in  assumptions  could
significantly affect these estimates and the resulting fair values. Derived fair
value estimates  cannot be  substantiated  by comparison to independent  markets
and,  in  many  cases,  could  not  be  realized  in an  immediate  sale  of the
instrument.  Also,  because of differences in methodologies and assumptions used
to estimate  fair  values,  Tri-County's  fair values  should not be compared to
those of other financial institutions.

Fair  value  estimates  are  based on  existing  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.
Accordingly,  the  aggregate  fair value  amounts  presented  do not  purport to
represent the underlying market of Tri-County.

The  following  summary  presents  the  methodologies  and  assumptions  used to
estimate the fair value of Tri-County's financial instruments.

Assets for Which  Fair  Value  Approximates  Carrying  Value:  The fair value of
certain  financial  assets  carried at cost,  including cash and due from banks,
deposits  with  banks,  and  accrued  interest   receivable  are  considered  to
approximate their respective  carrying values due to their short-term nature and
negligible credit losses. In addition, as discussed in Note 1, Tri-County valued
loans held for sale at fair value.

                                                                              27

<PAGE>


Federal  Home Loan Bank Stock:  As  discussed  in Note 1, the stock's fair value
approximates carrying value due to the limited marketability.

Securities:  Held  to  maturity  securities  are  carried  at  amortized  costs.
Available for sale securities are carried at fair value.  Fair value of actively
traded securities is determined by the secondary market, while the fair value of
nonactively traded securities is based on independent broker quotations.

Loans:  Loans are  valued  using  methodologies  suitable  for each  loan  type.
Variable rate loans that reprice  frequently and have no  significant  change in
credit risk, fair value is assumed to approximate carrying amount. Fair value of
other loans is estimated using a discounted cash flow analysis based on interest
rates currently offered for similar loan products.

Liabilities for Which Fair Value Approximates  Carrying Value: The fair value of
accounts payable, accrued liabilities and accrued interest payable is considered
to approximate  their respective book values due to their short-term  nature. By
definition,  fair values of deposits with no stated  maturities,  such as demand
deposits,  savings and NOW accounts and money market deposit  accounts are equal
to the amounts payable on demand at the reporting date.

Time Deposits:  The fair value of time deposits is estimated by discounting cash
flows based on  contractual  maturities  at current  interest  rates offered for
similar products.

Long-Term Debt: The valuation of long-term debt with floating rates is estimated
to be the same as carrying value.  Fair value of long-term debt with fixed rates
is  estimated  based on quoted  market  prices for similar  issues,  or by using
current rates offered to Tri-County for debt of the same remaining maturity.

Unused  Commitments  and Lines of Credit:  Tri-County  has reviewed the unfunded
portion of commitments to extend credit as well as lines of credit and available
overdraft protection. The fair value of such financial instruments is considered
to equal the amounts payable on demand at the reporting date.

Following are the estimated fair values of Tri-County's financial instruments:
<TABLE>
<CAPTION>

                                                                December 31, 1999      December 31, 1998
                                                                -----------------      -----------------
                                                               Carrying       Fair    Carrying       Fair
                                                                Amount       Value     Amount       Value
                                                                ------       -----     ------       -----
<S>                                                          <C>         <C>         <C>         <C>
Financial assets
 Assets for which fair value approximates book value         $ 2,958,900 $ 2,958,900 $ 4,250,783 $ 4,250,783
 Securities                                                  $34,476,495 $34,515,913 $34,063,166 $34,201,688
 Loans                                                       $48,979,883 $48,646,126 $42,054,222 $42,667,077

Financial liabilities
 Liabilities for which fair value approximates book value    $17,591,812 $17,591,812 $15,420,663 $15,420,663
 Time deposits                                               $34,587,587 $34,577,196 $30,770,264 $30,892,273
 Long-term debt                                              $25,558,367 $25,034,584 $23,799,117 $23,862,484

Off-balance sheet commitments                                $ 3,551,857 $ 3,551,857 $ 1,798,800 $ 1,798,800
</TABLE>

                                                                              28
<PAGE>


NOTE 18 -  PARENT COMPANY FINANCIAL INFORMATION


                        CONDENSED PARENT COMPANY ONLY
                           STATEMENTS OF CONDITION

                                                             December 31,
                                                           1999        1998
                                                           ----        ----
         Assets
           Cash                                         $ 249,071    $ 157,539
           Investment in subsidiary                     8,440,088    8,591,255
           Securities available for sale                  526,499      530,780
           Other assets, net                              760,974       32,770
                                                          -------       ------
                                        Total Assets   $9,976,632   $9,312,344
                                                       ==========   ==========
         Liabilities and stockholders' equity
           Other liabilities                             $  5,071     $  1,879
           Stockholders' equity                         9,971,561    9,310,465
                                                        ---------    ---------
          Total Liabilities and Stockholders' Equity   $9,976,632   $9,312,344
                                                       ==========   ==========

                           STATEMENTS OF OPERATIONS

                                                       Years ended December 31,
                                                          1999          1998
                                                          ----          ----
         Revenue
           Equity in earnings of subsidiary             $ 775,616    $ 917,644
           Other income                                    49,020       57,285
         Expense
           Operating expenses                             (47,254)     (52,416)
           Income tax benefit                              17,000       15,550
                                                           ------       ------
                                          Net Income     $794,382    $ 938,063
                                                         ========    =========


                                                                              29
<PAGE>
<TABLE>
<CAPTION>
                           STATEMENTS OF CASH FLOWS

                                                               Years ended December 31,
                                                                    1999        1998
                                                                    ----        ----
<S>                                                              <C>          <C>
Operating activities
Net income                                                       $ 794,382    $ 938,063
Adjustments to reconcile net income to net cash
     provided (used) by operating activities
  Earnings of subsidiary                                          (775,616)    (917,644)
  Amortization of organization expense                                   -          801
  (Increase) decrease in other assets and accrued liabilities        2,301        8,386
                                                                     -----        -----
  Net Cash Provided (Used)  by Operating Activities                 21,067       29,606
                                                                    ------       ------
Investing activities
  Purchase of property                                            (725,858)           -
  Dividends received                                             1,000,000    4,650,000
                                                                 ---------    ---------
  Net Cash Provided by Investing Activities                        274,142    4,650,000
                                                                   -------    ---------
Financing activities
  Dividends paid                                                  (391,363)    (470,268)
  Stock options exercised                                          140,929      127,126
  ESOP payments received                                            59,800       59,800
  Treasury stock purchased                                         (13,043)  (4,489,033)
                                                                   -------   ----------
  Net Cash Used by Financing Activities                           (203,677)  (4,772,375)
                                                                  --------   ----------
  Net Increase (Decrease) in Cash                                   91,532      (92,769)
Cash and cash equivalents - beginning of period                    157,539      250,308
                                                                   -------      -------
Cash and cash equivalents - end of period                        $ 249,071    $ 157,539
                                                                 =========    =========
</TABLE>

                                                                              30
<PAGE>
                                  DIRECTORS
                          LARRY C. GODDARD, Chairman
            ROBERT L. SAVAGE, President & Chief Executive Officer
                           CARL F. RUPP, Secretary
                               LANCE H. GRIGGS
                               DAVID C. KELLAM
                               WILLIAM J. RUEB

                                   AUDITORS
                         DALBY, WENDLAND & CO., P.C.
                        464 Main Street, P.O. Box 430
                        Grand Junction, Colorado 81502

                                 LEGAL COUNSEL
                                   JOHN MAIER
                              110 West 22nd Avenue
                           Torrington, Wyoming 82240

                                SPECIAL COUNSEL
                           MALIZIA SPIDI & FISCH, PC
                        1301 K Street, N.W., Suite 700 E
                             Washington, D.C. 20005

REGISTRAR AND STOCK TRANSFER AGENT
Inquiries regarding stock transfer,  registration,  lost certificates or changes
in name  and/or  address  should be  directed  to the stock  transfer  agent and
registrar in writing.

ATTN:  Investor Relations
AMERICAN SECURITIES TRANSFER & TRUST, INC.
12039 West Alameda Parkway, Suite Z-2
Lakewood, Colorado 80228

MARKET MAKERS
The following firms are currently market makers in the Company's shares:

Keefe, Bruyette & Woods, Inc. - New York, New York
Spear, Leeds & Kellogg - New York, New York

FORM 10-KSB
A copy of Form 10-KSB for the year ended December 31, 1999,  excluding exhibits,
as filed with the Securities and Exchange Commission,  will be furnished without
charge to stockholders upon request to the Secretary,  Tri-County Bancorp, Inc.,
P.O. Box 1057, Torrington, Wyoming 82240.

ANNUAL MEETING
The annual meeting of stockholders of Tri-County Bancorp, Inc. will be held
at 3:00 p.m. on April 26, 2000 at Tri-County Bank's main office, 2201 Main
Street, Torrington, Wyoming.


                                                                              31
<PAGE>
MAIN OFFICE 2201 Main Street, P.O. Box 1057 Torrington,  Wyoming 82240
Telephone - (307) 532-2111
Fax - (307) 532-7631
Email -  email@tricobank.com
Web Site - www.tricobank.com

BRANCH OFFICES
957 Maple, P.O. Box 337
Wheatland, Wyoming 82201
Telephone - (307) 322-9215
Fax - (307) 322-4080

421 Vandehei Avenue, P.O. Box 3260
Cheyenne, Wyoming 82003
Telephone - (307) 778-0021
Fax - (307) 778-0022

                              EXECUTIVE OFFICERS

                               Robert L. Savage
                     President & Chief Executive Officer

                                Joseph P. Guth
                           Executive Vice President

                             Earl F. Warren, Jr.
                            Senior Vice President

                               Tommy A. Gardner
                   Vice President & Chief Financial Officer

                                    STAFF

                  Thomas W. Bass, President & Branch Manager
             Roseanne L. Burnett, Vice President & Branch Manager
                      Jane E. Faber, Assistant Secretary
                       Richard R. Yates, Vice President
                              Pamela D. Cundall
                               Pam J. Heilbrun
                             Colleen M. Holtzclaw
                               Nancy A. Martin
                               Brita F. Mehling
                               Terri J. Pindell
                                Cheryl A. Rutt
                               Becky J. Shaffer
                                Linda L. Smith
                               Darlene L. Sorge
                               Debra K. Stoeger
                             Lynette K. Strecker
                                Scott L. Vasko
                              Mona Kay Williams


                                                                              32