TABLE OF CONTENTS

                                                                            Page

President's Message to Stockholders                                            1
Selected Consolidated Financial Information                                    2
Management's Discussion and Analysis                                           4
Report of Independent Certified Public Accountants                            15
Consolidated Balance Sheets                                                   16
Consolidated Statements of Earnings                                           18
Consolidated Statements of Comprehensive Income                               19
Consolidated Statements of Stockholders' Equity                               20
Consolidated Statements of Cash Flows                                         21
Notes to Consolidated Financial Statements                                    23
Stockholder Information                                                       41
Directors and Executive officers                                              42


                                 ANNUAL MEETING

The Annual  Meeting of  Stockholders  will be held at our main office located at
Myrtle  and Sixth  Streets,  Independence,  Kansas at 10:30  a.m.  Independence,
Central Standard time, on January 26, 2000.

<PAGE>

                  [FIRST INDEPENDENCE CORPORATION LETTERHEAD]



To Our Stockholders, Depositors and Friends:

     The  Board  of  Directors,   Officers,  and  Staff  of  First  Independence
Corporation  and its wholly owned  subsidiary,  First  Federal  Savings and Loan
Association, are pleased to provide you with the 1999 Annual Report.

     As you will see by reading the  accompanying  financial  statements,  First
Independence  had another  excellent year with $1,143,000 in net earnings.  1999
was our second best year in earnings, a 27% increase over 1998. Diluted earnings
per share for the 1999 fiscal year were $1.07,  compared to diluted earnings per
share of $.92 for the 1998 fiscal year, an increase of 16%. One other key number
worth noting is our Operating Expense to Average Assets; it is 1.89%, well below
our peer  group.  Our  recent  growth  has not  been at the  expense  of  higher
overhead.

     Since 1996 the banking  industry  has been  diligently  working on the year
2000 (Y2K)  problem.  All the hard work and resources  that we have dedicated to
this issue will soon be rewarded.  We are confident  that on January 3, 2000, it
will be  business as usual at First  Federal.  We believe  First  Federal is Y2K
compliant.

     As you may  recall,  at this  time last  year we were  working  on a merger
conversion with The Neodesha Savings and Loan  Association,  FSA. The conversion
was  completed on January 6, 1999,  with the sale of 150,896  shares of stock at
$9.42 per share.  With this  merger,  we now have a presence in three  different
communities in our market area. This merger has created an opportunity to expand
our  customer  base because of the  convenience  of three  banking  locations to
choose  from,  a service  unique in our market  area.  We believe our efforts to
expand into new markets and to augment  our  service  positively  effect  future
growth.  We will  continue to service the needs of our  customers and to explore
new products and services to better meet their complete financial needs.

     I  invite  you to  review  our  Annual  Report.  We are  very  proud of our
accomplishments and look forward to the coming year. On behalf of the directors,
management  and  employees,  I would like to  express  our  appreciation  to our
stockholders and valued customers for their continued support.


                                            Sincerely,

                                            /s/ Larry G. Spencer

                                            Larry G. Spencer
                                            President and Chief
                                            Executive Officer

<PAGE>

<TABLE>
<CAPTION>

SELECTED CONSOLIDATED FINANCIAL INFORMATION


                                                                             September 30,
                                                       -----------------------------------------------------------------------------
                                                          1999         1998               1997            1996              1995
                                                        ---------    ---------         ---------        ---------         ---------
                                                                                    (In Thousands)
Selected Financial Condition Data:

<S>                                                      <C>          <C>              <C>               <C>              <C>
Total assets                                             $138,131     $124,337         $112,523          $108,539         $101,904
Cash, cash equivalents and interest- bearing deposits       1,440          914            3,151             1,763            2,115
Loans receivable, net                                     112,893       93,684           74,559            67,683           60,370
Mortgage-backed securities - at cost                       10,912       17,274           23,528            28,039           28,594
Investment securities - at cost                             7,005        5,000            3,000             2,000            1,000
Securities available for sale                               2,000        3,418            4,783             5,894            7,358
Real estate acquired through foreclosure, net                 109           72               12                12               62
Deposits                                                   95,453       80,573           76,229            69,356           67,927
Borrowings                                                 27,500       30,100           23,700            24,300           18,800
Stockholders' equity                                       13,107       12,099           11,529            13,003           13,600

</TABLE>

<TABLE>
<CAPTION>

                                                                                Year Ended September 30,
                                                       -----------------------------------------------------------------------------
                                                         1999         1998              1997              1996              1995
                                                       ---------    ---------         ---------        ---------         ---------
                                                                                  (In Thousands)
<S>                                                   <C>          <C>               <C>               <C>               <C>
Selected Operations Data:
Total interest income                                  $  10,101    $  9,075          $  8,069          $  7,773          $  7,186
Total interest expense                                     5,989       5,556             5,059             4,669             3,852
                                                        --------    --------          --------          --------          --------
     Net interest income                                   4,112       3,519             3,010             3,104             3,334
Provision for losses on loans                                 66         ---               ---               ---               ---
                                                        --------    --------          --------          --------          --------
Net interest income after provision for losses
  on loans                                                 4,046       3,519             3,010             3,104             3,334
Non-interest income                                          354         192               159               214               267
Gain on sale of investments                                  ---         ---               ---               251               ---
Non-interest expense                                      (2,569)     (2,161)           (1,989)           (2,267)           (1,820)
                                                        --------    --------          --------          --------          --------
     Earnings before income tax expense                    1,831       1,550             1,180             1,302             1,781
Income tax expense                                           688         649               468               487               694
                                                        --------    --------          --------          --------          --------
Net earnings                                               1,143         901               712               815             1,087
                                                        ========    ========          ========          ========          ========
Basic earnings per share                                $   1.13    $    .98          $    .73          $    .72          $    .87
                                                        ========    ========          ========          ========          ========

</TABLE>

<PAGE>

FINANCIAL RATIOS

<TABLE>
<CAPTION>
                                                                                 September 30,
                                                             ----------------------------------------------------------
                                                               1999         1998       1997       1996          1995
                                                             ---------    ---------  ---------  ---------    ----------
Selected Financial Ratios and Other Data:
<S>                                                           <C>          <C>        <C>         <C>        <C>
Performance Ratios:
     Return on assets (ratio of net earnings to
      average total assets)                                    0.84%        0.75%      0.65%       0.78%       1.12%
     Interest rate spread information:
         Average during period                                 2.69         2.52       2.31        2.36        2.87
         End of period                                         2.58         2.29       2.19        2.17        2.36
     Net interest margin (1)                                   3.11         2.99       2.81        3.02        3.52
     Ratio of operating expense to average total assets        1.89         1.80       1.81        2.17        1.88
     Return on equity (ratio of net earnings to
      average equity)                                          8.95         7.72       6.09        6.21        8.16
Quality Ratios:
     Non-performing assets to total assets,
      at end of period (2)                                     1.84         1.07       1.25        0.57        0.77
     Allowance for loan losses to non-performing
      assets, at end of period (2)                            29.65        49.48      47.64      112.36       87.45
     Allowance for loan losses to non-performing
      loans, at end of period                                 30.99        52.30      48.05      114.62       94.91
Capital Ratios:
     Equity to total assets, at end of period                  9.49         9.73      10.25       11.98       13.35
     Average equity to average assets                          9.38         9.70      10.62       12.57       13.78
     Ratio of average interest-earning assets to
      average interest-bearing liabilities                   109.26       109.98     110.64      114.50      115.83
     Dividend payout ratio (3)                                31.54        31.25      34.93       27.37       16.47
     Number of full service offices                             3            2          2           1           1


</TABLE>
(1)  Net interest income divided by average interest-earning assets.

(2)  Includes  non-accruing loans, accruing loans delinquent 90 days or more and
     assets acquired through foreclosure.

(3)  Dividends paid per share divided by earnings per share.

[Omitted Earnings Per Share Graph]

       Basic  Diluted
1995 - $0.87   $0.84
1996 - $0.72   $0.69
1997 - $0.73   $0.68
1998 - $0.98   $0.92
1999 - $1.13   $1.07

[Omitted Dividends Paid Per Share]

1995 - $0.1375
1996 - $0.1875
1997 - $0.2375
1998 - $0.2875
1999 - $0.3375

<PAGE>

Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations

General

     On  October  5,  1993,  First  Federal  Savings  and  Loan  Association  of
Independence,  Kansas  converted  from  a  federally  chartered  mutual  savings
association to a federally  chartered stock savings association and concurrently
became a  wholly  owned  subsidiary  of First  Independence  Corporation.  First
Independence  earnings  are  primarily  dependent  on the  operations  of  First
Federal.  Currently,  First  Independence  has no business  activity  other than
acting as the holding  company for First  Federal.  As a result,  the  following
discussion relates primarily to the activities of First Federal. This discussion
should be read in conjunction  with the  consolidated  financial  statements and
accompanying notes included elsewhere in this report.

     Our business  consists of attracting  deposits from the general  public and
using these deposits primarily to make residential mortgage and other loans. Our
revenues are derived  principally  from interest  charges on mortgage  loans and
mortgage-backed  securities  and, to a lesser  extent,  from interest  earned on
investment  securities and interest-bearing  deposits.  In addition,  we receive
fees from loan  originations,  late payments and for various services related to
transaction and other deposit  accounts,  and dividends on our Federal Home Loan
Bank stock.  Operating  expenses consist primarily of employee  compensation and
benefits,  occupancy and equipment expenses,  federal deposit insurance premiums
and other general and administrative expenses.

     Our  operations,  and the  operations  of  savings  institutions  and their
holding  companies in general,  are  significantly  affected by general economic
conditions and the related monetary and fiscal policies of regulatory  agencies.
Deposit flows and cost of funds are  influenced  by interest  rates on competing
investments  and  general  market  rates of  interest.  Lending  activities  are
affected by the demand for  financing  of real estate and other types of assets,
which in turn is affected by the interest  rates at which such  financing may be
offered and other  factors  including  the  availability  of funds.  The primary
sources of funds for  lending  activities  include  deposits,  loan  repayments,
borrowings,  sales and  maturities  of  securities  available for sale and funds
provided from operations.

Forward-Looking Statements

     Certain  statements in this report that relate to our plans,  objectives or
future  performance may be deemed to be  forward-looking  statements  within the
meaning  of  the  Private  Securities  Litigation  Reform  Act  of  1995.  These
statements are based on our current expectations.  Actual strategies and results
in future periods may differ materially from those currently expected because of
various risks and uncertainties.  Additional discussion of factors affecting our
business and prospects is contained in our periodic  filings with the Securities
and Exchange Commission.

Asset/Liability Management and Market Risk

     Qualitative Aspects of Market Risk. We derive our income primarily from the
excess of interest  collected  over interest paid. The rates of interest we earn
on assets and pay on liabilities  generally are established  contractually for a
period of time. Market interest rates change over time. Accordingly, our results
of  operations,  like those of many  financial  institutions,  are  impacted  by
changes in interest  rates and our ability to adapt to changes in interest rates
is known as interest rate risk and is the most significant market risk.

     Quantitative  Aspects of Market Risk.  In an attempt to manage our exposure
to changes in interest rates and comply with applicable regulations,  we monitor
our interest rate risk. In monitoring interest rate risk, we continually analyze
and manage  our  assets  and  liabilities  based on their  payment  streams  and
interest rates, the timing of their maturities,  and their sensitivity to actual
or potential changes in market interest rates.

     The matching of assets and  liabilities  may be analyzed by  examining  the
extent  to  which  they are  "interest  rate  sensitive"  and by  monitoring  an
institution's  interest rate sensitivity "gap." An asset or liability is said to
be interest  rate  sensitive  within a specific time period if it will mature or
reprice within that time period. The interest rate sensitivity gap is defined as
the difference between the amount of interest-earning assets anticipated,  based
upon certain assumptions, to mature or reprice within a specific time period and
the amount of  interest-bearing  liabilities  anticipated,  based  upon  certain
assumptions,  to mature or  reprice  within  that  same  time  period.  A gap is
considered  positive when the amount of interest rate  sensitive  assets exceeds
the amount of interest rate sensitive liabilities.  A gap is considered negative
when the amount of interest  rate  sensitive  liabilities  exceeds the amount of
interest rate  sensitive  assets.  During a period of rising  interest  rates, a
negative  gap would tend to  adversely  affect  operations  while a positive gap
would tend to benefit operations.

     Since the early 1980's, we have emphasized,  subject to market  conditions,
the  origination  and holding of  adjustable-rate  mortgage loans and loans with
shorter  terms to maturity  than  traditional  30-year,  fixed-rate  loans.  Our
strategy has been to increase the  percentage  of assets in our  portfolio  with
more frequent repricing or shorter  maturities.  In response to customer demand,
however,  we continue to originate for our loan portfolio  fixed-rate  mortgages
with terms not greater than 30 years. In recent periods,  we have also purchased
adjustable-rate mortgage-backed securities. At September 30, 1999, approximately
$24.3  million,  or  24.0% of the  total  loans  secured  by real  estate,  were
adjustable-rate  mortgage  loans.  On the same date, we also had $7.1 million in
adjustable-rate  mortgage-backed  securities.

<PAGE>

     Our  adjustable-rate  mortgage  loans and  adjustable-rate  mortgage-backed
securities  adjust to  various  indices.  We  monitor  the mix of indices on our
adjustable rate assets and seek, consistent with market conditions, to achieve a
close match in the repricing  characteristics of our assets and liabilities.

     To increase  the  interest  rate  sensitivity  of our assets,  we have also
maintained short and  intermediate-term  investment securities and other assets.
At  September  30,  1999,  we had $3.2  million  of  investment  securities  and
interest-bearing  deposits maturing or repricing within three years. Finally, we
have  undertaken  various  marketing  programs  from  time to time over the last
decade in order to  extend  the term of our  deposit  liabilities.  In 1993,  we
introduced a new  certificate of deposit program in an attempt to reduce deposit
outflows and attract  longer term deposits  which were being lost as a result of
the  general  decline  in market  rates of  interest.  This  program  offers two
certificate  products which have 4- and 5-year terms.  At September 30, 1999, we
had approximately $8.6 million in these two certificates.

     In the future,  in managing our  interest  rate  sensitivity,  we intend to
continue to stress the origination of adjustable-rate mortgage loans, subject to
market conditions,  the purchase of adjustable-rate  mortgage-backed  securities
and the  maintenance  of a relatively  high level of short-term  securities  and
other assets.

     As part of our effort to monitor and manage  interest rate risk, we use the
Onet portfolio valueO methodology  adopted by the Office of Thrift  Supervision.
This approach  calculates the  difference  between the present value of expected
cash flows from assets and  liabilities,  as well as cash flows from off balance
sheet contracts, arising from an assumed 200 basis point increase or decrease in
interest rates. Under Office of Thrift Supervision regulations, an institution's
OnormalO  level of interest rate risk for this assumed  change in interest rates
is a decrease in the  institution's  net  portfolio  value not  exceeding  2% of
assets.

     Presented  below,  as of  September  30,  1999,  is an  analysis  of  First
Federal's  interest rate risk as measured by changes in net portfolio  value for
instantaneous  and sustained  parallel  shifts in the yield curve,  in 100 basis
point  increments,  up and down 200 basis  points and  compared to Board  policy
limits.  The table was  prepared  and  furnished  to us by the  Office of Thrift
Supervision.  Assumptions  used in  calculating  the  amounts in this table were
determined by the Office of Thrift Supervision (dollars in thousands):


                                                 Net Portfolio Value
Change in                                       At September 30, 1999
interest rate      Board Limit      --------------------------------------------
(Basis Points)     % Change         $ Amount         $ Change         % Change
-------------      ----------       ----------       ---------        ----------
     +200              -40%          $ 9,728         $ (4,893)          -33%
     +100              -25            12,357           (2,264)          -15
        0              ---            14,621              ---           ---
     -100              -25            16,202            1,581           +11
     -200              -40            17,236            2,615           +18

     As illustrated in the table,  we have structured our assets and liabilities
to minimize  our  exposure to  interest  rate risk.  In the event of a 200 basis
point  change in interest  rates,  we would  experience  an 18%  increase in net
portfolio  value in a declining rate  environment and a 33% decrease in a rising
rate environment. During periods of rising interest rates, the value of monetary
assets and liabilities generally decline. Conversely,  during periods of falling
interest rates, the value of monetary assets and liabilities generally increase.
However, the amount of change in value of specific assets and liabilities due to
changes in interest rates is not the same in a rising interest rate  environment
as in a falling interest rate environment  (i.e., as indicated above, the amount
of value  increase  under a specific  rate  decline  may not equal the amount of
value decrease under an identical upward rate movement).

     Certain  shortcomings  are inherent in the method of analysis  presented in
the foregoing  table.  For example,  although certain assets and liabilities may
have similar  maturities  or periods to  repricing,  they may react in different
degrees to changes in market interest rates. Also, the interest rates on certain
types of assets and  liabilities  may  fluctuate in advance of changes in market
interest  rates,  while  interest rates on other types may lag behind changes in
market rates.  Additionally,  certain assets,  such as adjustable-rate  mortgage
loans,  have features which  restrict  changes in interest rates on a short-term
basis  and over the life of the  asset.  Further,  in the  event of a change  in
interest  rates,  prepayment  and early  withdrawal  levels would likely deviate
significantly from those assumed in calculating the table.  Finally, the ability
of many borrowers to service their debt may decrease in the event of an interest
rate  increase.  As a result,  the actual effect of changing  interest rates may
differ from that presented in the foregoing table.

<PAGE>

Asset Quality

     The ratio of non-performing  assets to total assets is one indicator of our
exposure to credit  risk.  Our  non-performing  assets  consist of  non-accruing
loans,  accruing loans delinquent 90 days or more, troubled debt restructurings,
and  foreclosed  assets,  which have been acquired as a result of foreclosure or
deed-in-lieu of foreclosure.  At September 30, 1999,  non-performing assets were
approximately  $2,539,000,  which represents an increase of $1,214,000, or 91.6%
as compared to September 30, 1998. The ratio of  non-performing  assets to total
assets at September 30, 1999 was 1.84%  compared to 1.07% at September 30, 1998.
Included in  non-accruing  loans at September 30, 1999,  were four  construction
loans totaling  $330,000 secured by one- to four-family real estate,  twenty-one
loans  totaling  $849,000  secured  by  one-  to  four-family  real  estate  and
thirty-nine  consumer  loans  totaling  $132,000.   All  non-accruing  loans  at
September  30, 1999,  were located in our primary  market area. At September 30,
1999,  accruing  loans  delinquent  90 days or more  included  twenty-two  loans
totaling  $875,000 secured by one- to four-family real estate,  two construction
loans  totaling  $239,000  secured by one- to four-family  real estate,  and one
consumer loan totaling  $4,000.  All of our accruing loans delinquent 90 days or
more were secured by real estate  located in our primary  market area except for
three loans totaling  $216,000  secured by single family  residences  located in
Texas. All of the non-performing  construction loans were originated at our loan
production  office in  Lawrence,  Kansas.  At September  30,  1999,  real estate
acquired through foreclosure  consisted of five single family residences located
in our primary  market  area.  The  properties  have a total  carrying  value of
$110,000 and are  currently  offered for sale.  The  increase in  non-performing
assets  was  due  to  growth  in  the  respective   loan   portfolios  and  from
non-performing  loans  and  foreclosed  assets  totaling  $220,000,  which  were
acquired in The Neodesha Savings and Loan merger conversion.

[Omitted Non-performing Assets to Total Asset Graph 1995 - 0.77%; 1996 - 0.57%;
1997 - 1.25%; 1998 - 1.07%; 1999 - 1.84%]

     We have taken into account our non-performing assets and the composition of
the loan portfolio in establishing our allowance for loan losses.  The allowance
for loan losses  totaled  $753,000 at September  30, 1999,  which  represented a
$97,000  increase from the allowance for loan losses at September 30, 1998. This
increase was  primarily  due to the  transfer of $84,000 in  allowance  for loan
losses from Neodesha. The ratio of the allowance for loan losses as a percent of
total loans  decreased  from .70% at September 30, 1998 to .67% at September 30,
1999.  The  allowance  for loan  losses as a  percent  of  non-performing  loans
decreased from 52.30% at September 30, 1998 to 30.99% at September 30, 1999, due
to the increase in non-performing loans at September 30, 1999.

     The  allowance  for loan losses is  determined  based upon an evaluation of
pertinent  factors  underlying  the types and quality of our loans.  We consider
such factors as the repayment  status of a loan,  the  estimated net  realizable
value of the underlying  collateral,  the borrower's  ability to repay the loan,
current and anticipated  economic  conditions  which might affect the borrower's
ability  to  repay  the  loan  and  our  past  statistical   history  concerning
charge-offs.

<PAGE>
Results of Operations

     Average Balances,  Interest Rates and Yields.  The following table presents
for the  periods  indicated  the total  dollar  amount of  interest  income from
average  interest-earning  assets and related  yields,  as well as the  interest
expense on average interest-bearing  liabilities,  expressed both in dollars and
rates. No tax equivalent adjustments were made. All average balances are monthly
average  balances.  The use of monthly  averages rather than daily averages does
not have a  significant  effect upon our results.  Non-accruing  loans have been
included in the table as loans carrying a zero yield.

<TABLE>
<CAPTION>
                                                             Year Ended September 30,
                                     ---------------------------------------------------------------------
                                                     1999                               1998
                                     ---------------------------------------------------------------------
                                       Average     Interest               Average     Interest
                                     Outstanding   Earned/     Yield/   Outstanding   Earned/     Yield/
                                       Balance       Paid       Rate      Balance       Paid       Rate
                                     ---------------------------------------------------------------------
                                                              (Dollars in Thousands)
<S>                                   <C>         <C>           <C>      <C>        <C>          <C>
Interest-earning assets:
 Loans receivable (1)                 $106,176     $  8,551      8.05%   $ 85,966    $  7,032     8.18%
 Mortgage-backed securities             13,188          779      5.90      20,596       1,354     6.57
 Investment securities                   6,170          393      6.37       7,315         462     6.32
 Federal Home Loan Bank stock            1,808          125      6.94       1,443         110     7.60
 Federal funds sold                      4,050          199      4.91       1,679          90     5.37
 Other                                   1,025           54      5.28         435          27     6.23

                                      --------     --------              --------    --------
     Total interest-earning assets     132,417       10,101      7.63     117,434       9,075     7.72
                                      --------     --------              --------    --------
Interest-bearing liabilities:
  Demand and NOW deposits              30,524         1,162      3.81      26,079       1,083     4.15
  Savings deposits and
   certificates                        61,451         3,227      5.25      54,209       2,928     5.40
  Federal Home Loan Bank
   advances                            29,217         1,600      5.48      26,492       1,545     5.83
                                     --------      --------              --------    --------
      Total interest-bearing
       liabilities                    121,192         5,989      4.94     106,780       5,556     5.20
                                     --------      --------              --------    --------
Net interest income                                $  4,112                          $  3,519
                                                   ========                          ========
Net interest rate spread                                         2.69%                            2.52%
                                                                 ====                             ====
Net earning assets                   $ 11,225                            $ 10,654
                                     ========                            ========
Net yield on average interest-
 earning assets                                                  3.11%                            2.99%
                                                                 ====                             ====

Average interest-earning assets
  to average interest-bearing
  liabilities                                        109.26%                           109.98%
                                                   ========                          ========

</TABLE>

                                        Year Ended September 30,
                                  ---------------------------------
                                                 1997
                                  ---------------------------------
                                     Average     Interest
                                   Outstanding   Earned/     Yield/
                                     Balance       Paid       Rate
                                   ---------------------------------
                                        (Dollar in Thousands)
Interest-earning assets:
 Loans receivable (1)                $ 71,188    $  5,684     7.98%
 Mortgage-backed securities            26,137       1,727     6.61
 Investment securities                  7,598         513     6.75
 Federal Home Loan Bank stock           1,314          89     6.79
 Federal funds sold                       567          34     6.02
 Other                                    318          22     6.83

                                     --------    --------
     Total interest-earning assets    107,122       8,069     7.53
                                     --------    --------
Interest-bearing liabilities:
  Demand and NOW deposits              22,019         914     4.15
  Savings deposits and
   certificates                        51,219       2,745     5.36
  Federal Home Loan Bank
   advances                            23,583       1,400     5.93
                                     --------    --------
      Total interest-bearing
       liabilities                     96,821       5,059     5.22
                                     --------    --------
Net interest income                              $  3,010
                                                 ========
Net interest rate spread                                      2.31%
                                                              ====
Net earning assets                   $ 10,301
                                     ========
Net yield on average interest-
 earning assets                                               2.81%
                                                              ====

Average interest-earning assets
  to average interest-bearing
  liabilities                                        110.64%
                                                   ========
-------------------

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

<PAGE>
Rate/Volume Analysis of Net Interest Income

     The  following  schedule  presents the dollar amount of changes in interest
income and interest expense for major components of interest-earning  assets and
interest-bearing  liabilities.  For each category of interest-earning assets and
interest-bearing liabilities, information is provided on changes attributable to
(i) changes in volume (i.e.,  changes in volume multiplied by old rate) and (ii)
changes in rate (i.e.,  changes in rate multiplied by old volume).  For purposes
of this table,  changes  attributable  to both rate and volume,  which cannot be
segregated,  have been allocated proportionately to the change due to volume and
the change due to rate.

<TABLE>
<CAPTION>
                                                                 Year Ended September 30,
                                              -----------------------------------------------------------------------------------
                                                          1999 vs. 1998                          1998 vs. 1997
                                              ----------------------------------      --------------------------------------
                                                            Increase                               Increase
                                                           (Decrease)                             (Decrease)
                                                             Due to                                 Due to
                                              ----------------------------------      --------------------------------------
                                                                     Total                                         Total
                                                                     Increase                                     Increase
                                              Volume       Rate     (Decrease)          Volume         Rate       (Decrease)
                                              -------    --------  -----------        -----------    ---------    ----------
                                                                   (Dollars in Thousands)

<S>                                          <C>         <C>         <C>              <C>             <C>          <C>
Interest-earning assets:
     Loans receivable                         $ 1,629    $  (110)     $ 1,519          $ 1,206        $  142       $ 1,348
     Mortgage-backed securities                  (448)      (127)        (575)            (363)          (10)         (373)
     Investment securities                        (73)         4          (69)             (19)          (32)          (51)
     Federal Home Loan Bank stock                  25        (10)          15                9            12            21
     Federal funds sold                           117         (8)         109               60            (4)           56
     Other                                         32         (5)          27                7            (2)            5
                                              -------    -------      -------          -------       -------       -------
         Total interest-earning assets          1,282       (256)       1,026              900           106         1,006
                                              -------    -------      -------          -------       -------       -------
Interest-bearing liabilities:
     Demand and NOW deposits                      173        (94)          79              169           ---           169
     Savings deposits and certificates            382        (83)         299              162            21           183
     Federal Home Loan Bank advances              152        (97)          55              169           (24)          145
                                              -------    -------      -------          -------       -------       -------
         Total interest-bearing liabilities   $   707    $  (274)         433          $   500       $    (3)          497
                                              -------    -------      -------          -------       -------       -------

Net interest income                                                   $   593                                      $   509
                                                                      =======                                      =======

</TABLE>

     The  following  table  sets  forth  the  weighted  average  yields  on  our
interest-earning assets, the weighted average interest rates on interest-bearing
liabilities and the interest rate spread between the weighted average yields and
rates at the dates indicated. Non-accruing loans have been included in the table
as carrying a zero yield.

<TABLE>
<CAPTION>

                                                            At September 30,
                                             ------------------------------------------
                                                  1999         1998            1997
                                                -------       -------        -------
<S>                                             <C>            <C>           <C>
Weighted average yield on:
     Loans receivable                            7.68%         7.80%          7.74%
     Mortgage-backed securities                  6.14          6.34           6.66
     Investment securities                       6.48          6.38           6.97
     Federal funds sold                          5.04          5.36           5.28
     Other interest-earning assets               4.82          5.51           5.22
     Combined weighted average yield
      on interest-earning assets                 7.45          7.48           7.40
Weighted average rate paid on:
     Savings deposits and certificates           5.12          5.44           5.38
     Demand and NOW deposits                     3.86          4.04           4.06
     Federal Home Loan Bank advances             5.58          5.74           6.11
     Combined weighted average rate
      paid on interest-bearing liabilities       4.87          5.19           5.21
     Spread                                      2.58          2.29           2.19

</TABLE>

<PAGE>

FINANCIAL CONDITION

     Total assets  increased  $13.8  million,  or 11.1%,  from $124.3 million at
September 30, 1998 to $138.1  million at September  30, 1999.  This increase was
primarily due to increases in net loans receivable of $19.2 million,  investment
securities  of  $600,000,  cash and cash  equivalents  of  $500,000  and accrued
interest  receivable  of  $100,000.   These  increases  in  assets,  along  with
reductions  in  advances  from the  Federal  Home  Loan  Bank of  Topeka of $2.6
million,  were  funded by  increases  in  savings  deposits  of  $14.9,  and the
redeployment of funds received from decreases in  mortgage-backed  securities of
$6.4 million.  These  increases  were  primarily  due to assets and  liabilities
acquired in the merger conversion with The Neodesha Savings and Loan.

     Total  loans  receivable  increased  $19.2  million  from $93.7  million at
September  30, 1998, to $112.9  million at September 30, 1999.  The increase was
primarily  due to  loans  acquired  in The  Neodesha  Savings  and  Loan  merger
conversion  totaling  $8.9 million and, to a lesser  extent,  construction  loan
originations  at  our  loan  production  office  in  Lawrence,   Kansas.   These
construction  loans  generally  have terms of nine  months or less and  interest
rates tied to the prime rate plus a margin.  The increase in construction  loans
also  contributed to an increase in loans in process due to the  disbursement of
funds  throughout  the  construction  period.  The  increase  was  also  due  to
originations  in  our  market  area  consisting  primarily  of 15-  and  30-year
fixed-rate loans,  mortgage loans with a fixed rate for the first three years of
the loan term that  automatically  convert  to  one-year  adjustable  rate loans
during  the  fourth  year of the loan  term,  and to a lesser  extent,  one-year
adjustable rate mortgages.

[Total Assets Graph Omitted - 1995 - $101,904; 1996 - $108,539; 1997 - $112,523;
1998 - $124,337; 1999 - $138,131]

     Total deposits  increased $14.9 million from $80.6 million at September 30,
1998, to $95.5 million at September 30, 1999.  Deposits increased  primarily due
to deposits  acquired in The Neodesha  Savings and Loan merger  conversion which
totaled $10.9 million at September  30, 1999. To a lesser  extent,  the increase
was due to public units  depositing  short-term  funds into the OPlatinumO money
fund account and new accounts  totaling $3.2 million opened at the  Coffeyville,
Kansas branch office during the fiscal year. The  "Platinum"  money fund account
offers tiered rates on a limited  transaction account with the highest rate paid
on balances of $50,000 and above.  We feel the "Platinum"  money fund provides a
lower risk,  insured  alternative for deposit customers  considering higher risk
investments in order to get higher yields than money market accounts.

[Loans  graph  omitted  -  Multi-family  -  0.74%;   Non-residential   -  7.29%;
Construction  - 20.13%;  Home Equity - 0.73%;  Other  Consumer - 3.56%;  One- to
four-family 67.55%]

     Total borrowed funds decreased $2.6 million from $30.1 million at September
30, 1998 to $27.5  million at  September  30,  1999.  The  decrease was due to a
scheduled  principal  repayment of advances  obtained from the Federal Home Loan
Bank of Topeka. Most of the advances obtained from the Federal Home Loan Bank of
Topeka were used by us to invest in loans  receivable at a positive  spread over
the term of the advances.

     Total  stockholders'  equity  increased  $1.0 million from $12.1 million at
September  30, 1998 to $13.1  million at September  30,  1999.  The increase was
primarily due to net earnings  from  operations of $1.1 million and net proceeds
of $677,000  from our issuance of 150,896  shares of common stock in  connection
with the merger  conversion with Neodesha  Savings and Loan. To a lesser extent,
the  increase  was due to the  repayment  of employee  stock  ownership  debt of
$88,000,  fair value  adjustment of $79,000 on ESOP shares committed for release
and common stock options  exercised of $43,000.  These  increases were partially
offset by the use of  $629,000  to  repurchase  55,885  shares of common  stock,
dividends of $344,000  paid to  stockholders,  and a decrease in the  unrealized
gains on securities available for sale of $50,000.

[Stockholders'  Equity to total assets  graph  ommitted:  1995 - 13.35%;  1996 -
11.98%; 1997 - 10.25%; 1998 - 9.73%; 1999 - 9.49%]

<PAGE>

Comparison of Fiscal Years Ended September 30, 1999 and September 30, 1998

     General.  Net  earnings for the fiscal year ended  September  30, 1999 were
$1,143,000 as compared to $901,000 for the fiscal year ended September 30, 1998,
an increase of $242,000,  or 26.8%.  The increase in net earnings was  primarily
due to increases in net interest income of $593,000 and  non-interest  income of
$162,000.  These  increases were partially  offset by increases in  non-interest
expense of $408,000, provision for loan losses of $66,000 and income tax expense
of $39,000.

[Net earnings graph omitted:  1995 - $1,087;  1996 - $815;  1997 - $712;  1998 -
$901; 1999 - $1,143]

     Net Interest Income. Net interest income increased $593,000,  or 16.9%, for
the fiscal  year ended  September  30, 1999 as compared to the fiscal year ended
September  30, 1998.  This increase was due primarily to an increase in interest
income of $1.0 million,  or 11.3%;  offset  partially by an increase in interest
expense of $433,000, or 7.8%. Interest income increased primarily due to a $15.0
million  increase  in the average  balance of  interest-earning  assets,  offset
partially by a 9 basis point  decrease in the average yield on  interest-earning
assets.  Interest expense increased primarily due to a $14.4 million increase in
the average balance of  interest-bearing  liabilities,  offset partially by a 26
basis point decrease in the average rate paid on  interest-bearing  liabilities.
The average balance of interest-earning assets and interest-bearing  liabilities
increased primarily due to The Neodesha Savings and Loan merger conversion.  The
average  rate  earned on  interest-earning  assets and paid on  interest-bearing
liabilities  decreased primarily due to a decrease in market interest rates. The
variance  in the  decrease  was due  primarily  to  interest-earning  assets and
interest-bearing  liabilities  acquired in The Neodesha  Savings and Loan merger
conversion   having  a  greater   spread   than   interest-earning   assets  and
interest-bearing liabilities on First Federal's balance sheet.

     Interest  Income.  Interest  income for the fiscal year ended September 30,
1999,  increased  to $10.1  million  from $9.1 million for the fiscal year ended
September  30,  1998.  This  increase was caused  primarily  by a $15.0  million
increase in the average outstanding amount of interest-earning assets during the
fiscal  year ended  September  30,  1999,  as  compared to the fiscal year ended
September  30,  1998 due to assets  acquired  in The  Neodesha  Savings and Loan
merger conversion.  To a lesser extent, the increase in interest-earning  assets
was due to an increase in the average balance of loans receivable from increased
construction loan originations at our Lawrence,  Kansas loan production  office.
This  increase  was  partially  offset by a  decrease  in the  average  yield on
interest-earning  assets. The average yield on interest-earning assets decreased
9 basis points to 7.63% for the fiscal year ended September 30, 1999, from 7.72%
for the fiscal year ended September 30, 1998. This decrease was caused primarily
by the general  decline in interest  rates  resulting in a reduction in yield on
our loan  portfolio  from 8.18% to 8.05%.  The average rate on  interest-earning
assets  went down less than it would have if there had been no  increase  in the
average  balance  of loans,  since  they have a higher  rate  earned  than other
assets.  Therefore,  the change in mix of interest-earning assets to more higher
earning assets, reduced the decrease due to market rates of interest going down.
To a lesser extent,  the decrease in yield was due to a decrease in yield on our
mortgage-backed  securities  portfolio  from 6.57% to 5.90% for the fiscal  year
ended  September  30, 1999,  as compared to the same period in fiscal 1998.  The
decreased  yield was  caused by  accelerated  amortization  of  premiums  on the
mortgage-backed securities due to an increase in prepayment speeds.

     Interest Expense.  Interest expense for the fiscal year ended September 30,
1999,  increased by $433,000 to $6.0 million as compared to $5.6 million for the
fiscal year ended September 30, 1998. This increase in interest  expense was due
primarily  to a $14.4  million  increase  in the average  outstanding  amount of
interest-bearing  liabilities during the fiscal year ended September 30, 1999 as
compared  to the  fiscal  year ended  September  30,  1998.  This  increase  was
partially  offset by a 26 basis point decrease in average interest rates paid on
interest-bearing  liabilities,  caused by decreases in market interest rates and
the addition of deposits from The Neodesha Savings and Loan merger conversion at
a lower average  interest rate than First  Federal's  deposits.  The increase in
interest-bearing  liabilities was primarily due to an $11.7 million  increase in
the average  outstanding  balance of deposits due primarily to savings  deposits
acquired in The  Neodesha  Savings and Loan merger  conversion  and, to a lesser
extent, an increase in average advances obtained from the Federal Home Loan Bank
of Topeka.

     Provision  for Loan  Losses.  The  provision  for loan losses  represents a
charge to  earnings  to  maintain  the  allowance  for loan losses at a level we
believe  is  adequate  to absorb  potential  losses in the loan  portfolio.  The
provision  for loan  losses  amounted  to  $66,000  for the  fiscal  year  ended
September 30, 1999 as compared to no provision for the same period in 1998. This
increase  in  provision  for loan  losses was in  recognition  of the  increased
balance  of  construction  loans  in our  loan  portfolio  and the  increase  in
non-performing  loans. It is also reflective of the loan loss allowance obtained
in the merger  conversion  with Neodesha  Savings and Loan.  Although we believe
that we use the best information available in providing for possible loan losses
and we believe  that the  allowance is adequate at  September  30, 1999,  future
adjustments  to the  allowance  could be  necessary  and net  earnings  could be
affected if circumstances  and/or economic conditions differ  substantially from
the assumptions used in making the initial determinations.

     Non-interest  Income.  Non-interest  income increased  $162,000 to $354,000
during the fiscal year ended  September 30, 1999 as compared to $192,000 for the
fiscal  year ended  September  30,  1998.  The  increase  was  primarily  due to
increased  checking and deposit account fees as a result of accounts acquired in
The  Neodesha  Savings  and Loan  merger  conversion.  To a lesser  extent,  the
increase was due to

<PAGE>

amortization  of $71,000 related to negative  goodwill  acquired in The Neodesha
Savings and Loan merger  conversion  and  increased  late charges and other fees
associated with mortgage loans.

     Non-interest Expense.  Total non-interest expense increased to $2.6 million
for the fiscal year ended  September  30, 1999 from $2.2  million for the fiscal
year ended September 30, 1998, an increase of $408,000,  or 18.9%.  The increase
was  primarily  due to  increases  in  compensation  and  employee  benefits  of
$186,000,  other  expense of  $103,000,  data  processing  fees of $68,000,  and
occupancy and equipment of $52,000.  These  increases  were primarily due to the
merger conversion with Neodesha Savings and Loan, resulting in additional staff,
occupancy and equipment,  stationery, printing and office supplies expense. To a
lesser extent,  the increase in  compensation  expense was the result of normal,
annual cost of living  increases in salaries and bonuses,  offset partially by a
decrease in compensation expense associated with the ESOP due to the decrease in
our stock price.

     Income Tax  Expense.  Income tax expense was  $688,000  for the fiscal year
ended  September  30,  1999  compared  to  $649,000  for the  fiscal  year ended
September 30, 1998,  an increase of $39,000.  This increase was primarily due to
an increase in pre-tax  earnings  during the 1999 period as compared to the 1998
period.  Our effective tax rates were 37.6% and 41.9% for the fiscal years ended
September 30, 1999 and September 30, 1998, respectively. Rates exceeded expected
rates for the September 30, 1998 period due  primarily to  compensation  expense
associated  with the ESOP which is not deductible  for income tax purposes.  The
non-deductible ESOP compensation  expense was partially offset for the September
30, 1999  period by  negative  goodwill  amortization  which is not  included in
income for income tax calculation  purposes,  resulting in a lower effective tax
rate.

Comparison of Fiscal Years Ended September 30, 1998 and September 30, 1997

     General.  Net  earnings for the fiscal year ended  September  30, 1998 were
$901,000 as compared to $712,000 for the fiscal year ended  September  30, 1997,
an increase of $189,000,  or 26.7%.  The increase in net earnings was  primarily
due to increases in net interest income of $509,000 and  non-interest  income of
$33,000.  These  increases  were  partially  offset by  increases  in income tax
expense of $181,000 and non-interest expense of $171,000.

     Net Interest Income.EENet interest income increased $509,000, or 16.9%, for
the fiscal  year ended  September  30, 1998 as compared to the fiscal year ended
September  30, 1997.  This increase was due primarily to an increase in interest
income of $1.0 million,  or 12.5%;  offset  partially by an increase in interest
expense of $497,000, or 9.8%. Interest income increased primarily due to a $10.3
million  increase in the average balance of  interest-earning  assets,  and a 19
basis point  increase  in the  average  yield on  interest-earning  assets.  The
average yield on interest-earning assets increased primarily due to construction
loan  originations at the Lawrence loan production  office.  These  construction
loans  generally  have terms of nine  months or less and carry  higher  rates of
interest than loans  originated  for the purchase of  single-family  residences.
Interest  expense  increased  primarily due to a $10.0  million  increase in the
average balance of interest-bearing  liabilities,  offset partially by a 2 basis
point  decrease in the average rate paid on  interest-bearing  liabilities.  The
average rate paid on interest-bearing  liabilities  decreased primarily due to a
$4.1 million increase in the average balance of low cost demand and NOW deposits
(resulting in a larger  percentage of  interest-bearing  liabilities)  and, to a
lesser extent,  a decrease in interest rates on Federal Home Loan Bank of Topeka
advances.

     Interest  Income.  Interest  income for the fiscal year ended September 30,
1998,  increased  to $9.1  million  from $8.1  million for the fiscal year ended
September  30,  1997.  This  increase was caused  primarily  by a $10.3  million
increase in the average outstanding  balance of  interest-earning  assets during
the fiscal year ended  September  30, 1998, as compared to the fiscal year ended
September 30, 1997;  due to the increase in the average  balance of loans.  To a
lesser  extent,  the  increase in interest  income was due to an increase in the
average yield on interest-earning  assets. The average yield on interest-earning
assets  increased 19 basis  points to 7.72% for the fiscal year ended  September
30, 1998, from 7.53% for the fiscal year ended September 30, 1997. This increase
was caused  primarily  by increases in yield on our Federal Home Loan Bank stock
from 6.79% to 7.60% and on its loan portfolio from 7.98% to 8.18% for the fiscal
year ended  September 30, 1998,  as compared to the fiscal year ended  September
30, 1997.  These increases were partially offset by a decrease in the investment
securities  portfolio yield from 6.75% to 6.32% and  mortgage-backed  securities
from 6.61% to 6.57% for the fiscal year ended September 30, 1998, as compared to
the fiscal year ended  September  30,  1997.  The  increase in yield on the loan
portfolio was primarily due to  construction  loan  originations at our new loan
production office in Lawrence,  Kansas.  These construction loans generally have
terms of nine  months or less and  interest  rates tied to the prime rate plus a
margin. The decrease in yield on investment  securities was primarily due to the
reinvestment of proceeds from called securities into lower yielding investments.

     Interest Expense.  Interest expense for the fiscal year ended September 30,
1998,  increased by $497,000 to $5.6 million as compared to $5.1 million for the
fiscal year ended  September 30, 1997. This increase was primarily the result of
a $10.0 million increase in the average  outstanding balance of interest-bearing
liabilities  during the fiscal year ended  September 30, 1998 as compared to the
fiscal year ended September 30, 1997. This increase was partially  offset by a 2
basis  point  decrease  in the average  interest  rate paid on  interest-bearing
liabilities, caused by an increase in the average balance of low cost demand and
NOW deposits (resulting in a larger percentage of interest-bearing  liabilities)
and, to a lesser extent,  a decrease in interest rates on Federal Home Loan Bank
advances.  The increase in  interest-bearing  liabilities was primarily due to a
$7.1  million  increase  in the  average  outstanding  balance of  deposits  due
primarily to new accounts  opened at the  Coffeyville,  Kansas branch office and
seasonal deposits from public units.

<PAGE>

     Provision  for Loan Losses.  There was no provision for losses on loans for
the fiscal years ended  September 30, 1998 and September 30, 1997. We determined
that  additional  provisions  were not necessary  based upon our analysis of the
established  allowance and review of the composition of the loan  portfolio.  We
will continue to monitor our allowance for loan losses and make future additions
to the  allowance  through  the  provision  for  loan  losses  as  economic  and
regulatory  conditions dictate.  However,  there can be no assurance that future
losses will not exceed estimated amounts or that additional  provisions for loan
losses will not be required in future periods.  In addition,  our determinations
as to the amount of the  allowance  for loan losses are subject to review by the
regulatory  agencies which can order the establishment of additional  general or
specific allowances.

     Non-interest  Income.  Non-interest  income  increased  $33,000 to $192,000
during the fiscal year ended  September 30, 1998 as compared to $159,000 for the
fiscal  year ended  September  30,  1997.  The  increase  was  primarily  due to
increased  checking and deposit  account fees as a result of new accounts in the
Coffeyville  branch. To a lesser extent,  the increase was due to increased fees
associated with mortgage loans. Recurring non-interest income generally consists
of  servicing  fees as well as  deposit  and other  types of fees.  Non-interest
income  levels are  anticipated  to remain stable in the future due to the small
number of checking accounts held by us.

     Non-interest Expense.  Total non-interest expense increased to $2.2 million
for the fiscal year ended  September  30, 1998 from $2.0  million for the fiscal
year ended  September 30, 1997, an increase of $171,000,  or 8.6%.  The increase
was  primarily  due to  increases  in  compensation  and  employee  benefits  of
$117,000,  occupancy  and  equipment  of $67,000,  and data  processing  fees of
$46,000.  These  increases  were  primarily  due to the  opening  of a new  loan
production office in Lawrence,  Kansas, resulting in additional staff, occupancy
and equipment, stationery, printing and office supplies expense. Data processing
expenses also  increased  due to increased  account  volumes at the  Coffeyville
branch and  processing  price  increases.  To a lesser  extent,  the increase in
compensation  expense was the result of normal,  annual cost of living increases
in salaries and bonuses, and increased  compensation expense associated with the
ESOP plan due to our higher  stock  price  during a portion  of the year.  These
increases  were  partially  offset by decreases in other expenses of $43,000 and
federal deposit insurance premiums of $17,000.

     Income Tax  Expense.  Income tax expense was  $649,000  for the fiscal year
ended  September  30,  1998  compared  to  $468,000  for the  fiscal  year ended
September 30, 1997, an increase of $181,000.  This increase was primarily due to
an increase in pre-tax  earnings  during the 1998 period as compared to the 1997
period.  Our effective tax rates were 41.9% and 39.7% for the fiscal years ended
September 30, 1998 and September 30, 1997, respectively.  Rates exceed effective
combined  federal and state statutory rates of 38% due primarily to compensation
expense  associated  with the ESOP,  of which a portion  is not  deductible  for
income tax purposes.

Liquidity and Capital Resources

     The Office of Thrift Supervision  requires minimum levels of liquid assets.
At September 30, 1999, Office of Thrift Supervision  regulations  required First
Federal to maintain an average daily balance of  investments  in an amount equal
to at least 4.0% of the sum of its  average  daily  balance of net  withdrawable
deposit accounts and borrowings  payable in one year or less. Such  requirements
may be changed from time to time by the Office of Thrift  Supervision to reflect
changing economic conditions.  Such investments are intended to provide a source
of  relatively  liquid  funds upon which First  Federal may rely if necessary to
fund deposit  withdrawals and other  short-term  funding needs.  First Federal's
regulatory  liquidity at September  30, 1999 was 9.66%,  as compared to 7.01% at
September  30, 1998.  This  increase in liquidity  was  primarily  due to liquid
investments  acquired in The Neodesha Savings and Loan merger conversion.  These
liquid  assets are being  invested  in  mortgage  loan  originations  which will
eventually  reduce our  liquidity  ratio to a more normal  level.  First Federal
normally attempts to maintain liquidity between 7% and 9%.

     Our  primary   source  of  funds   consists   of  deposits   and  loan  and
mortgage-backed securities repayments.  Other sources of funds available include
borrowings  from  the  Federal  Home  Loan  Bank of  Topeka.  We use our  liquid
resources   principally   to  meet  on-going   commitments,   to  fund  maturing
certificates of deposit and deposit withdrawals, to invest, to fund existing and
future loan commitments,  to maintain liquidity, and to meet operating expenses.
We believe  that our  existing  sources of funds  will be  adequate  to meet our
foreseeable liquidity needs.

     Our primary investing activity is the origination of mortgage loans and the
purchase  of  mortgage-backed  and other  securities.  At  September  30,  1999,
mortgage  loans  and  mortgage-backed  securities  accounted  for 89.6% of total
assets. We have been able to generate sufficient cash through the retail deposit
market, our traditional  funding source, and through short-term  borrowings,  to
provide the cash  utilized in  investing  activities.  A $10.0  million  line of
credit has also been established with the Federal Home Loan Bank of Topeka since
1995, of which the entire amount is available at September 30, 1999. The line of
credit is  scheduled  to mature on  February  5, 2000,  and will be renewed  for
another  one year term at that  time.  The line of credit is  subject to various
conditions,  including the pledge of acceptable collateral.  The primary purpose
of the line of credit is to serve as a back-up liquidity  facility,  however, we
may  from  time to time  utilize  the  line of  credit  to  purchase  investment
securities and fund other commitments.

     Liquidity  management  is  both a daily  and  long-term  responsibility  of
management. We adjust our investments in liquid assets based upon our assessment
of (i) expected loan demand, (ii) expected deposit flows, (iii) yields available
on  interest-bearing  deposits,  and (iv) the objectives of its  asset/liability
management  program.  Excess liquidity is invested generally in interest-bearing
overnight deposits and other short-term

<PAGE>

government and agency  obligations.  If we require additional funds,  beyond our
internal  ability to generate,  we have additional  borrowing  capacity with the
Federal Home Loan Bank of Topeka.

     We anticipate that we will have sufficient  funds available to meet current
loan  commitments.  At September 30, 1999,  we had  outstanding  commitments  to
extend  credit  which  amounted  to  $2.0  million,   including  commitments  on
construction  loans.  We are not aware of any  trends,  events or  uncertainties
which will have or that are reasonably  likely to have a material  effect on our
liquidity, capital resources or operations.

     Certificates  of  deposit  scheduled  to  mature  in one  year  or  less at
September  30, 1999  totaled  approximately  $29.2  million.  We believe  that a
significant  portion of such deposits will remain with First Federal.  There can
be no assurance, however, that we can retain all of these deposits. At September
30, 1999,  we had $27.5  million in advances  from the Federal Home Loan Bank of
Topeka with $3.0 million maturing in one year or less.

     First Federal has minimum capital  standards  which  generally  require the
maintenance of regulatory  capital  sufficient to meet each of three tests:  the
tangible capital requirement,  the core capital requirement,  and the risk-based
capital  requirement.  The  tangible  capital  requirement  provides for minimum
tangible capital (defined as retained earnings less all intangible assets) equal
to 1.5% of adjusted  total  assets.  The core capital  requirement  provides for
minimum core capital (tangible capital plus supervisory  goodwill) equal to 3.0%
of assets.  The risk-based capital  requirement  provides for the maintenance of
core  capital  plus  general loss  allowances  (less a specified  percentage  of
certain equity investments) equal to 8.0% of risk-weighted  assets. In computing
risk-weighted  assets,  we multiply  the book value of each asset on our balance
sheet by a defined risk-weighting factor (e.g., one- to four-family  residential
loans carry a  risk-weighted  factor of 50%).  We have  reviewed  these  capital
standards  and  determined  that we are in  compliance  with  each of the  three
requirements.  As of September 30, 1999, our tangible capital, core capital, and
risk-based capital of $12.1 million,  $12.1 million,  and $12.8 million exceeded
the applicable  minimum  requirements by $10.0 million,  $8.0 million,  and $7.5
million, respectively.

     The following  table sets forth our compliance  with such  requirements  at
September 30, 1999.

<TABLE>
<CAPTION>

                                  Office of Thrift                              First Federal's capital level
                                 Supervision requirement                           at September 30, 1999
                              ----------------------------           -------------------------------------------------
                                % of                                    % of                                  Amount
Capital standard                Assets             Amount             Assets              Amount            of Excess
                                ------            --------            ------             --------           ---------
                                                               (Dollars in Thousands)
<S>                             <C>                <C>                <C>                <C>                <C>
Tangible capital                 1.50%              $2,071             8.76%              $12,092            $10,021
Core capital (1)                 3.00                4,142             8.76                12,092              7,950
Risk-based capital               8.00                5,354            19.19                12,845              7,491

</TABLE>
----------------
(1)  Based on current core capital requirement of 3%.

See  Note  L of  Notes  to  Consolidated  Financial  Statements  for  additional
information.

     We have  reviewed  our  regulatory  restrictions  relating  to loans to one
borrower,  qualification as a qualified thrift lender, and other restrictions on
lending and investment,  and have determined that, based on our capital position
and lending and investment policies,  these restrictions have not had a material
impact on our operations.

Impact of Inflation and Changing Prices

     The  financial  statements  and  related  data  presented  herein have been
prepared in accordance  with generally  accepted  accounting  principles,  which
require the measurement of financial position and results of operations in terms
of historical  dollars without  considering  changes in the relative  purchasing
power of money over time because of inflation.  As a result, interest rates have
a more significant  impact on our performance than the effects of general levels
of inflation. Interest rates do not necessarily move in the same direction or in
the same magnitude as the prices of goods and services.

Year 2000 Compliance Issues

     The year 2000 issue confronting us and our suppliers,  customers' suppliers
and  competitors  centers on the inability of computer  systems to recognize the
year  2000.  Many  existing  computer  programs  and  systems   originally  were
programmed  with six digit dates that  provided  only two digits to identify the
calendar  year in the date  field.  With the  impending  new  millennium,  these
programs and computers will recognize O00O as the year 1900 rather than the year
2000.

     The  board of  directors  and  management  view the  year  2000  issue as a
potentially serious interruption to the conduct of our day-to-day operations. To
alleviate this potential interruption, we have established a year 2000 committee
to assess the risk of  potential  problems  that might arise from the failure of
computer  programs to recognize  the year 2000 and to develop a plan to mitigate
any such risk. This committee  reports to the board at least quarterly about the
status and progress of our Y2K plan.

     Our year 2000 action plan covers  five  areas;  awareness  of the  problem,
inventory  and  assessment  of hardware  and  software  for year 2000  problems,
renovation of necessary systems,  validation of testing plans and implementation
of system  changes.  We have completed all areas of the plan and are believed to
be year 2000 compliant at the time of this report.

     We are expensing all costs  associated  with training and software as those
costs are  incurred,  and such costs are being  funded  through  operating  cash
flows.  Hardware  cost will be  capitalized  and expensed  under our fixed asset
guidelines.  The total cost of the year 2000 conversion  project is estimated to
be $110,000. Expenses of approximately $108,000 were incurred and expensed by us
through  September  30, 1999.  We will review our budget  monthly to help ensure
that sufficient resources have been allocated to this project. Any deviations to
the preliminary budget will be reported to the Board of Directors.

     During the assessment  phase, we developed back-up or contingency plans for
each of our mission  critical  systems.  Virtually  all of our mission  critical
systems are dependent upon third-party vendors or service providers.  Therefore,
contingency  plans  include  selecting  a new  vendor or  service  provider  and
converting to their system. For some systems, contingency plans consist of using
spreadsheet software or reverting to manual systems until system problems can be
corrected.  Responses  from third party vendors  indicate  that the  significant
providers  are  currently  year  2000  compliant.  Specifically,  our core  data
processing is provided by an outside vendor,  which has certified their software
is year 2000 compliant.

     The potential year 2000 risk  includes,  but is not limited to, the risk of
insufficient  liquidity,  communication  loss,  power loss and the  inability to
process  customer data.  The potential  impact on our  profitability  related to
these  risks and those not yet  identified  cannot be  measured or known at this
time.

 Effect of New Accounting Standards

     In June 1998, the Financial  Accounting Standards Board issued Statement of
Financial Accounting  Standards No. 133, "Accounting for Derivative  Instruments
and Hedging  Activities."  Statement of Financial  Accounting  Standards No. 133
requires  companies  to record  derivatives  on the  balance  sheet as assets or
liabilities,  measured at fair value.  Gains or losses resulting from changes in
the values of those  derivatives  would be accounted for depending on the use of
the derivative and whether it qualifies for hedge accounting.  The key criterion
for hedge accounting is that the hedging  relationship  must be highly effective
in  achieving  offsetting  changes in fair  value or cash  flows.  Statement  of
Financial  Accounting  Standards  No.  133 does not allow  hedging of a security
which is classified as held to maturity. Accordingly, upon adoption of Statement
of Financial Accounting Standards No. 133, companies may reclassify any security
from held to maturity to available for sale if they wish to be able to hedge the
security in the future.  This  Statement,  as amended by  Statement of Financial
Accounting Standards No. 137, is effective for fiscal years beginning after June
15, 2000 with early adoption encouraged for any fiscal quarter beginning July 1,
1998 or later,  with no retroactive  application.  The Company  currently has no
plans to adopt Statement of Financial  Accounting  Standards No. 133 early or to
reclassify  securities from held to maturity upon adoption.  Management believes
adoption of Statement of Financial  Accounting Standards No. 133 will not have a
material  effect on our financial  position or results of  operations,  nor will
adoption require additional capital resources.

     In October 1998, the Financial  Accounting Standards Board issued Statement
of Financial  Accounting  Standards  No. 134,  OAccounting  for  Mortgage-Backed
Securities  After  the  Securitization  of  Mortgage  Loans  Held  for Sale by a
Mortgage Banking  Enterprise.O  Statement of Financial  Accounting Standards No.
134 changes the way companies  involved in mortgage banking  activities  account
for  certain  securities  and other  interests  they retain  after  securitizing
mortgage  loans  that were  held for sale.  Statement  of  Financial  Accounting
Standards  No.  134  allows  any  retained  mortgage-backed  securities  after a
securitization of mortgage loans held for sale to be classified based on holding
intent in accordance with Statement of Financial  Accounting  Standards No. 115,
except in cases where the retained  mortgage-backed  security is committed to be
sold  before or during  the  securitization  process,  in which  case it must be
classified as trading.  Previously, all retained mortgage-backed securities were
required  to  be  classified  as  trading.  Statement  of  Financial  Accounting
Standards No. 134 was effective as of July 1, 1999,  and did not have a material
impact on our results of operations or our financial condition.

<PAGE>



               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors
First Independence Corporation and Subsidiary

We  have  audited  the  accompanying   consolidated   balance  sheets  of  First
Independence  Corporation  and Subsidiary as of September 30, 1999 and 1998, and
the  related  consolidated   statements  of  earnings,   comprehensive   income,
stockholders' equity and cash flows for the years then ended. These consolidated
financial statements are the responsibility of the Corporation'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 audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the consolidated financial position of First Independence
Corporation  and  Subsidiary  as  of  September  30,  1999  and  1998,  and  the
consolidated  results of their operations and their  consolidated cash flows for
the  years  then  ended  in  conformity  with  generally   accepted   accounting
principles.




Wichita, Kansas
October 22, 1999



<PAGE>




                           CONSOLIDATED BALANCE SHEETS




<PAGE>




                  First Independence Corporation and Subsidiary

                           CONSOLIDATED BALANCE SHEETS

                                  September 30,


<TABLE>
<CAPTION>

                                     ASSETS

                                                                      1999               1998
                                                                      ----               ----

<S>                                                              <C>                <C>
Cash and due from banks                                          $    1,064,794     $   474,406
Other interest-bearing deposits                                         375,201         439,174
                                                                 --------------  --------------
               Cash and cash equivalents                              1,439,995         913,580



Investment securities held to maturity (estimated
   fair value of $6,957,733 in 1999 and $5,004,700
   in 1998)                                                           7,005,279       5,000,000
Investment securities available for sale                              1,999,800       3,418,311
Mortgage-backed securities held to maturity
   (estimated fair value of $10,852,983 in 1999
   and $17,403,143 in 1998)                                          10,912,279      17,274,238
Loans receivable, net                                               112,893,406      93,684,258
Premises and equipment, net                                           1,322,128       1,309,633
Federal Home Loan Bank stock, at cost                                 1,441,600       1,574,000
Accrued interest receivable                                             887,465         753,970
Real estate acquired through foreclosure                                109,579          71,596
Other                                                                   119,809         337,008
                                                                 --------------  --------------

               Total assets                                      $  138,131,340  $  124,336,594
                                                                 ==============  ==============

</TABLE>

The accompanying notes are an integral part of these statements.





<PAGE>

<TABLE>
<CAPTION>

                                       LIABILITIES AND STOCKHOLDERS' EQUITY

                                                                          1999                1998
                                                                          ----                ----
<S>                                                                  <C>                  <C>
Deposits                                                             $   95,452,864       $  80,573,077
Advances from borrowers for taxes and
   insurance                                                                825,330             745,520
Deferred income taxes                                                            -              126,889
Advances from Federal Home Loan Bank                                     27,500,000          30,100,000
Accrued expenses and other                                                1,246,538             692,067
                                                                     --------------        ------------
               Total liabilities                                        125,024,732         112,237,553

Stockholders' equity
   Preferred stock, $.01 par value, 500,000 shares
      authorized; none issued                                                    -                    -
   Common stock, $.01 par value,  2,500,000 shares authorized;
      1,649,288 shares and 1,498,392 shares issued
      in 1999 and 1998, respectively                                         16,493              14,984
   Additional paid-in capital                                             8,132,391           7,239,207
   Retained earnings - substantially restricted                          10,876,339          10,077,091
   Accumulated other comprehensive income, net of related taxes               2,316              52,497
   Required contributions for shares acquired by
      Employee Stock Ownership Plan (ESOP)                                 (199,680)           (145,475)
   Treasury stock, 587,458 shares in 1999 and
      539,073 shares in 1998 - at cost                                   (5,721,251)         (5,139,263)
                                                                     --------------        ------------

        Total stockholders' equity                                       13,106,608          12,099,041
                                                                     --------------        ------------
               Total liabilities and stockholders' equity            $  138,131,340        $124,336,594
                                                                     ==============        ============

</TABLE>

<PAGE>

<TABLE>
<CAPTION>


                                   First Independence Corporation and Subsidiary

                                        CONSOLIDATED STATEMENTS OF EARNINGS

                                             Year ended September 30,


                                                            1999             1998
                                                            ----             ----
<S>                                                   <C>                 <C>
Interest income
   Loans                                               $  8,550,856        $  7,032,289
   Mortgage-backed securities                               778,763           1,353,937
   Investment securities                                    393,202             462,407
   Interest-bearing deposits and other                      378,469             226,914
                                                       ------------        ------------
      Total interest income                              10,101,290           9,075,547

Interest expense
   Deposits                                               4,389,547           4,010,717
   Borrowed funds                                         1,599,633           1,545,727
                                                       ------------        ------------
      Total interest expense                              5,989,180           5,556,444
                                                       ------------        ------------
Net interest income                                       4,112,110           3,519,103
Provision for loan losses                                    66,000                   -
                                                       ------------        ------------
Net interest income after provision for loan losses       4,046,110           3,519,103

Noninterest income
   Service charges                                          202,057             105,277
   Real estate operations                                   (34,725)              3,177
   Other                                                    186,885              83,620
                                                       ------------        ------------
                                                            354,217             192,074
Noninterest expense
   Employee compensation and benefits                     1,421,077           1,235,386
   Occupancy and equipment                                  286,758             235,043
   Data processing fees                                     264,800             197,134
   Other operating                                          596,297             493,107
                                                       ------------        ------------
                                                          2,568,932           2,160,670
                                                       ------------        ------------
Earnings before income taxes                              1,831,395           1,550,507
Income tax expense                                          688,307             649,087
                                                       ------------        ------------
               NET EARNINGS                            $  1,143,088        $    901,420
                                                       ============        ============
Earnings per share
   Basic                                                   $1.13                $.98

   Diluted                                                 $1.07                $.92

The accompanying notes are an integral part of these statements.


</TABLE>

<PAGE>

<TABLE>
<CAPTION>


                                   First Independence Corporation and Subsidiary

                                  CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                                             Year ended September 30,


                                                                    1999          1998
                                                                    ----          ----

<S>                                                            <C>             <C>
Net earnings                                                   $ 1,143,088     $   901,420

Other comprehensive income, net of tax
   Unrealized gains (losses) on securities avail-
      able for sale arising during the period,
      net of tax benefit of $30,757 in 1999 and
      expense of $22,913 in 1998                                   (50,181)         37,385
                                                               -----------     -----------

Comprehensive income                                           $ 1,092,907     $   938,805
                                                               ===========     ===========

The accompanying notes are an integral part of these statements.

</TABLE>



<PAGE>

<TABLE>
<CAPTION>


                                           First Independence Corporation and Subsidiary

                                           CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

                                              Years ended September 30, 1999 and 1998

                                                                                                                     Required
                                                                                                     Accumulated      contri-
                                                                                                        other         butions
                                                                   Additional                      comprehensive    for shares
                                                    Common          paid-in          Retained          income,       acquired
                                                     stock           capital         earnings            net          by ESOP
                                                   ---------      -----------        --------     ----------------    -------
<S>                                                <C>           <C>              <C>               <C>             <C>
Balance at October 1, 1997                         $  14,984     $  7,122,744      $   9,441,054     $  15,112      $  (218,212)
Net earnings for the year                                 -                -             901,420            -                -
Cash dividends of $.2875 per share                        -                -            (265,383)           -                -
Common stock options exercised                            -            (8,641)                -             -                -
Appreciation of securities available
   for sale                                               -                -                  -         37,385               -
ESOP loan repayments                                      -                -                  -             -            72,737
Fair value adjustment on ESOP
   shares committed for release                           -           125,104                 -             -                -
Amortization of unearned stock
   compensation                                           -                -                  -             -                -
Purchase of 25,298 shares of
   treasury stock                                         -                -                  -             -                -
                                                   ---------     ------------      -------------     ---------      -----------
Balance at September 30, 1998                         14,984        7,239,207         10,077,091        52,497         (145,475)
Net earnings for the year                                 -                -           1,143,088            -                -
Cash dividends of $.3375 per share                        -                -            (343,840)           -                -
Issuance of 150,896 shares of common stock             1,509          817,968                 -             -          (142,176)
Common stock options exercised                            -            (3,987)                -             -                -
Depreciation of securities available
   for sale                                               -                -                  -        (50,181)              -
ESOP loan repayments                                      -                -                  -             -            87,971
Fair value adjustment on ESOP
   shares committed for release                           -            79,203                 -             -                -
Purchase of 55,885 shares of
   treasury stock                                         -                -                  -             -                -
                                                   ---------     ------------      -------------     ---------      -----------

Balance at September 30, 1999                      $  16,493     $  8,132,391      $  10,876,339     $   2,316      $  (199,680)
                                                   =========     ============      =============     =========      ===========
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
                                                   Unearned
                                                    stock
                                                   compen-            Treasury
                                                 sation - RRP           stock            Total
                                                 ------------         ---------          -----
<S>                                               <C>              <C>             <C>
Balance at October 1, 1997                         $  (43,634)     $ (4,802,767)    $   11,529,281
Net earnings for the year                                  -                 -             901,420
Cash dividends of $.2875 per share                         -                 -            (265,383)
Common stock options exercised                             -             40,061             31,420
Appreciation of securities available
   for sale                                                -                 -              37,385
ESOP loan repayments                                       -                 -              72,737
Fair value adjustment on ESOP
   shares committed for release                            -                 -             125,104
Amortization of unearned stock
   compensation                                        43,634                -              43,634
Purchase of 25,298 shares of
   treasury stock                                          -           (376,557)          (376,557)
                                                   ----------      ------------        -----------
Balance at September 30, 1998                              -         (5,139,263)        12,099,041
Net earnings for the year                                  -                 -           1,143,088
Cash dividends of $.3375 per share                         -                 -            (343,840)
Issuance of 150,896 shares of common stock                 -                 -             677,301
Common stock options exercised                             -             46,831             42,844
Depreciation of securities available
   for sale                                                -                 -             (50,181)
ESOP loan repayments                                       -                 -              87,971
Fair value adjustment on ESOP
   shares committed for release                            -                 -              79,203
Purchase of 55,885 shares of
   treasury stock                                          -           (628,819)          (628,819)
                                                   ----------      ------------        -----------

Balance at September 30, 1999                      $       -       $ (5,721,251)       $13,106,608
                                                   ==========      ============        ===========

</TABLE>

The accompanying notes are an integral part of these statements.

<PAGE>

<TABLE>
<CAPTION>


                                   First Independence Corporation and Subsidiary

                                       CONSOLIDATED STATEMENTS OF CASH FLOWS

                                             Year ended September 30,


                                                                                      1999                1998
                                                                                      ----                ----
<S>                                                                               <C>               <C>
Cash flows from operating activities
   Net earnings                                                                   $   1,143,088     $   901,420
   Adjustments to reconcile net earnings to net cash
      provided by operating activities
         Provision for loan losses                                                       66,000               -
         Depreciation                                                                   112,234         102,889
         Amortization of premiums and discounts on
            investments and mortgage-backed securities                                  104,186          67,751
         Amortization of deferred loan origination fees                                (238,920)       (164,663)
         Amortization of expense related to employee
            benefit plans                                                               167,174         241,475
         Amortization of negative goodwill                                              (70,544)              -
         Gain on sale of real estate acquired
            through foreclosure                                                         (23,834)         (6,515)
         Deferred income taxes                                                           47,614          69,928
         Increase (decrease) in cash due to changes, net of
            effects of acquisition
               Accrued interest receivable                                              (36,996)        (41,672)
               Other assets                                                             (19,608)         13,157
               Accrued expenses and other liabilities                                  (304,948)        250,495
               Income taxes payable                                                     (57,256)        148,643
                                                                                   ------------    ------------
                  Net cash provided by operating activities                             888,190       1,582,908

Cash flows from investing activities
   Proceeds from sale of investment security                                            355,053               -
   Proceeds from maturities and repayment of
      securities
         Available for sale                                                           1,000,000       1,466,372
         Held to maturity                                                            12,463,166       9,164,071
   Purchase of securities
      Available for sale                                                                 (8,452)       (224,832)
      Held to maturity                                                               (6,000,000)     (5,000,000)
   Purchase of loans                                                                          -      (3,691,591)
   Net increase in loans                                                            (10,156,916)    (15,341,907)
   Purchase of Federal Home Loan Bank stock                                            (271,300)              -
   Proceeds from redemption of Federal Home Loan Bank stock                             507,300               -
   Capital expenditures                                                                (124,729)       (115,022)
   Proceeds from sale of real estate acquired through
      foreclosure                                                                        70,074          11,147
   Cash acquired in acquisition                                                       2,114,968               -
                                                                                   ------------    ------------
         Net cash used in investing activities                                          (50,836)    (13,731,762)

</TABLE>


<PAGE>

<TABLE>
<CAPTION>


                                   First Independence Corporation and Subsidiary

                                 CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED

                                             Year ended September 30,


                                                                        1999               1998
                                                                        ----               ----
<S>                                                                <C>              <C>
Cash flows from financing activities
   Net increase in deposits                                        $   2,208,774     $   4,343,901
   Net increase in advances from borrowers
      for taxes and insurance                                             58,176            52,451
   Advances from Federal Home Loan Bank                               27,700,000        27,700,000
   Repayment of Federal Home Loan Bank advances                      (30,300,000)      (21,300,000)
   Cash dividends paid                                                  (343,840)         (265,383)
   Purchase of treasury stock                                           (628,819)         (376,557)
   Stock issuance costs                                                 (327,338)         (274,625)
   Stock options exercised                                                42,844            31,420
   Net proceeds from sale of stock                                     1,279,264                 -
                                                                   -------------     -------------
   -

         Net cash provided by (used in) financing activities            (310,939)        9,911,207
                                                                   -------------     -------------
Net increase (decrease) in cash and
   cash equivalents                                                      526,415        (2,237,647)
Cash and cash equivalents at beginning of year                           913,580         3,151,227
                                                                   -------------     -------------


Cash and cash equivalents at end of year                           $   1,439,995     $     913,580
                                                                   =============     =============

Supplemental disclosures of cash flow information
   Cash paid during the year for
      Income taxes                                                 $     697,949     $     430,516
      Interest                                                         6,032,114         5,532,187

   Noncash investing and financing activities
      Transfer from loans to real estate acquired
         through foreclosure                                             186,283           138,236
      Issuance of loans receivable in connection with
         the sale of real estate acquired through
         foreclosure                                                     111,250            65,550
      Liabilities assumed in conjunction with acquisition             13,700,846                 -


The accompanying notes are an integral part of these statements.

</TABLE>


<PAGE>




                  First Independence Corporation and Subsidiary

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                           September 30, 1999 and 1998


NOTE A - SUMMARY OF ACCOUNTING POLICIES

First Independence Corporation (the "Corporation") is a savings and loan holding
company whose  activities  are  primarily  limited to holding the stock of First
Federal Savings and Loan Association of Independence (the "Association"). Future
references to the  Corporation  or the  Association  are utilized  herein as the
context  requires.  The  Association  conducts  a general  banking  business  in
southeastern  Kansas  which  consists of  attracting  deposits  from the general
public and applying  those funds to the  origination  of loans for  residential,
consumer  and  nonresidential  purposes  and  the  purchase  of  investment  and
mortgage-backed  securities.  The  Association's  profitability is significantly
dependent on net  interest  income,  which is the  difference  between  interest
income generated from interest-earning  assets (i.e., loans and investments) and
the  interest  expense  paid on  interest-bearing  liabilities  (i.e.,  customer
deposits and borrowed  funds).  Net interest  income is affected by the relative
amount of  interest-earning  assets  and  interest-bearing  liabilities  and the
interest received or paid on these balances. The level of interest rates paid or
received  by the  Association  can be  significantly  influenced  by a number of
environmental factors, such as governmental monetary policy, that are outside of
management's control.

The  consolidated  financial  information  presented herein has been prepared in
accordance  with generally  accepted  accounting  principles  (GAAP) and general
accounting  practices  within the  financial  services  industry.  In  preparing
consolidated  financial  statements  in  accordance  with  GAAP,  management  is
required to make estimates and assumptions  that affect the reported  amounts of
assets and liabilities  and the disclosure of contingent  assets and liabilities
at the date of the  financial  statements  and revenues and expenses  during the
reporting period. Actual results could differ from such estimates.

The following is a summary of the Corporation's  significant accounting policies
which have been  consistently  applied in the  preparation  of the  accompanying
consolidated financial statements.

1. Principles of consolidation

The consolidated financial statements include the accounts of First Independence
Corporation  and its  wholly-owned  subsidiary,  First Federal  Savings and Loan
Association  of  Independence.   All  significant   intercompany   balances  and
transactions have been eliminated.

2. Cash equivalents

For purposes of reporting cash flows,  cash and cash  equivalents  include cash,
due from banks, federal funds sold and other overnight deposits.

3. Investment securities and mortgage-backed securities

Investment  securities  and  mortgage-backed  securities are classified in three
categories  and  accounted  for  as  follows:   (a)  debt  securities  that  the
Corporation  has the  positive  intent  and  ability  to hold  to  maturity  are
classified as held-to-  maturity  securities and reported at amortized cost, (b)
debt and equity  securities that are bought and held principally for the purpose
of  selling  them in the near term are  classified  as  trading  securities  and
reported at fair value,  with  unrealized  gains and losses included in earnings
and (c) debt and equity  securities not classified as either  held-to-  maturity
securities or trading securities are classified as available-for-sale securities
and  reported at fair value,  with  unrealized  gains and losses  excluded  from
earnings and reported as the sole component of accumulated  other  comprehensive
income in stockholders' equity.

Premiums and discounts on investment securities are amortized to operations over
the term of the security using the level yield method. Premiums and discounts on
mortgage-backed  securities  are amortized and accreted to operations  using the
level  yield  method  over  the   estimated   life  of  the   underlying   loans
collateralizing  the  securities.  Gains and  losses  on the sale of  securities
designated as available for sale are recorded using the specific  identification
method.


<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE A - SUMMARY OF ACCOUNTING POLICIES - Continued

4. Loans receivable

Loans  receivable  that  management  has the  intent  and  ability to hold until
maturity  or  pay-off  are  reported  at their  outstanding  principal  balance,
adjusted for any charge-offs,  the allowance for loan losses, unearned discounts
and net deferred loan origination fees.

The  allowance  for loan  losses is  increased  by  charges  to  operations  and
decreased by charge-offs (net of recoveries).  Management's  periodic evaluation
of the adequacy of the  allowance is based on the  Association's  past loan loss
experience,  known and inherent risks in the portfolio,  adverse situations that
may affect the borrower's  ability to repay,  estimated  value of any underlying
collateral and current economic conditions.

Specific reserves are established for any impaired nonresidential loan for which
the recorded  investment  in the loan  exceeds the  measured  value of the loan.
Loans  subject to impairment  valuation  are defined as nonaccrual  loans or any
other  loan  where  it is  probable  that  all  amounts  due  according  to  the
contractual terms will not be collected, exclusive of smaller balance homogenous
loans such as home  equity,  consumer  and 1-4 family  residential  real  estate
loans. The values of loans subject to impairment  valuation are determined based
on the present  value of expected  future  cash flows,  the market  price of the
loans, or the fair values of the underlying collateral if the loan is collateral
dependent.

Uncollectible  interest on loans that are contractually  past due is charged off
or an allowance is established based on management's  periodic  evaluation.  The
allowance is  established  by a charge to interest  income equal to all interest
previously  accrued.  Income is subsequently  recognized only to the extent cash
payments are received until, in management's judgment, the borrower's ability to
make periodic  interest and principal  payments is back to normal, in which case
the loan is returned to accrual status.  If the collection of principal in whole
or in part is in doubt,  all payments  received on nonaccrual loans are credited
to principal until such doubt is eliminated.

5. Loan origination fees and related costs

Loan  origination  fees received,  net of certain direct  origination  costs are
deferred on a  loan-by-loan  basis and  amortized  to  interest  income over the
contractual life of the loan using the interest method,  giving effect to actual
loan  prepayments.  Loan  origination  costs are  considered  to be direct costs
attributable to originating a loan.

6. Real estate acquired through foreclosure

Real estate properties  acquired through, or in lieu of, loan foreclosure are to
be sold and are  initially  recorded  at fair  value at the date of  foreclosure
establishing  a new  cost  basis.  Subsequent  to  foreclosure,  valuations  are
periodically performed by management and the real estate is carried at the lower
of carrying  amount or fair value less cost to sell.  Revenue and expenses  from
operations  and changes in the  valuation  allowance are included in real estate
operations.

7. Premises and equipment

Premises  and  equipment  are  carried  at cost less  accumulated  depreciation.
Depreciation  is included in occupancy and equipment  expense and is provided by
the straight-line method over the following estimated useful lives:

                                                                      Years
                                                                      -----

      Building                                                        8-50
      Furniture, fixtures and equipment                               5-20
      Automobiles                                                        5

<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE A - SUMMARY OF ACCOUNTING POLICIES - Continued

The costs of maintenance and repairs are charged to operations as incurred.  The
costs  of  significant  additions,   renewals  and  betterments  to  depreciable
properties  are  capitalized  and  depreciated  over the  remaining  or extended
estimated  useful lives of the  properties.  Gains and losses on  disposition of
property and equipment are included in operations.

8. Employee stock ownership plan

The Corporation  sponsors a leveraged  employee stock ownership plan (ESOP). The
ESOP holds company stock which serves as collateral for the ESOP debt. As shares
are released from collateral, the Corporation reports compensation expense equal
to the current market price of the shares, and the shares become outstanding for
earnings-per-share  ("EPS")  computations.  Dividends on released and  allocated
ESOP shares are  recorded as a reduction  of  retained  earnings;  dividends  on
unallocated ESOP shares are recorded as compensation cost.

9. Stock-based compensation

The Company  uses the  intrinsic  value  based  method of  accounting  for stock
options.  Under the  intrinsic  method,  compensation  cost for stock options is
measured as the  excess,  if any, of the quoted  market  price of the  Company's
stock over the exercise price at the measurement date.

10. Income taxes

First  Independence  Corporation and its subsidiary file a consolidated  federal
income tax return.  Deferred tax assets and liabilities are determined  based on
the  differences  between the financial  accounting  and tax basis of assets and
liabilities.  Deferred tax assets or  liabilities  at the end of each period are
determined  using the  currently  enacted tax rate  expected to apply to taxable
income in the periods in which the  deferred  tax asset or liability is expected
to be settled or realized.

11. Earnings per share

Basic  earnings  per share is computed by dividing  net earnings by the weighted
average number of common shares outstanding during the year.

Diluted  earnings per share is computed by dividing net earnings by the weighted
average  number of common  shares  outstanding  during  the year plus the common
share equivalents related to outstanding stock options.  Weighted average common
shares outstanding and diluted shares deemed outstanding were as follows:

                                                               Year ended
                                                              September 30,
                                                         -----------------------
                                                            1999         1998
                                                            ----         ----

  Weighted average common shares outstanding              1,015,212     924,091
   Common share equivalents related to outstanding
   stock options                                             51,003      53,403
                                                          ---------     -------
  Adjusted weighted average common shares
   deemed to be outstanding                               1,066,215     977,494

Common shares outstanding  exclude  unallocated and committed shares held by the
ESOP trust.


<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998

NOTE A - SUMMARY OF ACCOUNTING POLICIES - Continued

12. Comprehensive income

The Corporation  adopted SFAS No. 130,  "Reporting  Comprehensive  Income" as of
October  1,  1998.  Accounting  principles  generally  require  that  recognized
revenue,  expenses, gains and losses be included in net income. Although certain
changes  in assets  and  liabilities,  such as  unrealized  gains and  losses on
available-for-sale  securities,  are  reported  as a separate  component  of the
equity section of the balance sheet,  such items,  along with net earnings,  are
components of comprehensive  income.  The adoption of SFAS No. 130 had no effect
on the Corporation's net earnings or stockholders' equity.


NOTE B - INVESTMENT SECURITIES

The  amortized  cost,  gross  unrealized  gains,  gross  unrealized  losses  and
estimated fair value of investment securities are as follows:

<TABLE>
<CAPTION>
                                                                            September 30, 1999
                                                      -------------------------------------------------------------
                                                                           Gross           Gross         Estimated
                                                         Amortized      unrealized     unrealized          fair
             Held to maturity                              cost            gains          losses           value
             ----------------                         -------------     ----------     -----------     ------------
<S>                                                   <C>                <C>           <C>             <C>

   U.S. Government and agency obligations             $  6,400,258       $   1,352     $  (45,570)     $ 6,356,040
   Municipal securities                                    605,021             675         (4,004)         601,693
                                                      ------------       ---------     ----------      -----------

                                                      $  7,005,279       $   2,027     $  (49,574)     $ 6,957,733
                                                      ============       =========     ==========      ===========
             Available for sale

   U.S. Government agency obligations                 $  1,996,064       $   6,521     $   (2,785)     $ 1,999,800
                                                      ============       =========     ==========      ===========


                                                                            September 30, 1998
                                                      ------------------------------------------------------------
                                                                           Gross           Gross         Estimated
                                                         Amortized      unrealized     unrealized          fair
             Held to maturity                              cost            gains          losses           value
             ----------------                         -------------     ----------     ----------        ---------

   U.S. Government agency obligations                 $  5,000,000       $   4,700     $       -       $  5,004,700
                                                      ============       =========     ==========      ============

             Available for sale
             ------------------

   Intermediate term liquidity
      portfolio                                       $    346,749       $   5,862     $       -       $    352,611
   U.S. Government and agency obligations                2,986,888          78,812             -          3,065,700
                                                      ------------       ---------     ----------      ------------

                                                      $  3,333,637       $  84,674     $       -       $  3,418,311
                                                      ============       =========     ==========      ============
</TABLE>



<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE B - INVESTMENT SECURITIES - Continued

The  amortized  cost and  estimated  fair  value of U.S.  Government  and agency
obligations at September 30, 1999, by term to maturity are as follows:

                                                  Estimated
                                  Amortized          fair
    Held to maturity                cost            value
    ----------------             ------------     ----------

Due in one year or less          $    510,148     $  510,753
Due in one to two years               300,188        301,540
Due in two to five years            1,000,000        983,000
Due in five years to ten years      5,194,943      5,162,440
                                 ------------     ----------

                                 $  7,005,279    $ 6,957,733
                                 ============    ===========

    Available for sale
    ------------------

Due in one to two years          $    993,086    $   990,300
Due in two to five years            1,002,978      1,009,500
                                 ------------    -----------
                                 $  1,996,064    $ 1,999,800
                                 ============    ===========

Investment  securities  with  a fair  value  of  $3,384,340  and  $3,065,700  at
September  30, 1999 and 1998,  respectively,  are  pledged to secure  government
deposits.


NOTE C - MORTGAGE-BACKED SECURITIES

The  amortized  cost,  gross  unrealized  gains,  gross  unrealized  losses  and
estimated fair value of mortgage-backed securities are summarized as follows:

<TABLE>
<CAPTION>
                                                                September 30, 1999
                                            -------------------------------------------------------------
                                                                Gross           Gross          Estimated
                                               Amortized      unrealized      unrealized         fair
        Held to maturity                         cost           gains           losses           value
        ----------------                    -------------     ----------     ------------   -------------
<S>                                         <C>               <C>            <C>            <C>

GNMA certificates                           $      28,952      $  2,280      $        -     $      31,232
FHLMC certificates                              4,109,413        40,753          (16,725)       4,133,441
FNMA certificates                               2,920,861        28,257          (33,324)       2,915,794
Collateralized mortgage obligations
     FHLMC                                      1,120,538             -          (44,898)       1,075,640
     FNMA                                       2,732,515             -          (35,639)       2,696,876
                                            -------------     ---------      -----------    -------------

                                            $  10,912,279     $  71,290      $  (130,586)   $  10,852,983
                                            =============     =========      ===========    =============

                                                                September 30, 1998
                                            -------------------------------------------------------------
                                                                Gross           Gross          Estimated
                                               Amortized      unrealized      unrealized         fair
        Held to maturity                         cost           gains           losses           value
        ----------------                    -------------     ----------     ------------   -------------

GNMA certificates                           $      39,291     $   3,673      $        -     $      42,964
FHLMC certificates                              6,188,601        82,373           (6,104)       6,264,870
FNMA certificates                               4,361,636       101,460          (25,069)       4,438,027
Collateralized mortgage obligations
     FHLMC                                      3,661,107         9,022           (9,764)       3,660,365
     FNMA                                       3,023,603         5,750          (32,436)       2,996,917
                                            -------------     ---------      -----------    -------------

                                            $  17,274,238     $ 202,278      $   (73,373)   $  17,403,143
                                            =============     =========      ===========    =============

</TABLE>

<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE C - MORTGAGE-BACKED SECURITIES - Continued

Mortgage-backed securities generally mature ratably over the 30-year term of the
underlying  loans   collateralizing  the  securities.   Expected  maturities  on
mortgage-backed  securities  will differ  from  contractual  maturities  because
borrowers may have the right to call or prepay  obligations with or without call
or prepayment penalties.

Mortgage-backed  securities  with a fair value of $10,384,130 and $10,637,352 at
September 30, 1999 and 1998, respectively,  are pledged to secure government and
other deposits.


NOTE D - LOANS RECEIVABLE

Loans receivable at September 30 are summarized as follows:

                                                      1999           1998
                                                      ----           ----

First mortgage loans
    One-to-four family residences                $ 84,052,872     $ 71,854,962
    Multi-family residences                           914,016        1,001,302
    Nonresidential                                  9,075,464        9,065,316
    Construction                                   25,051,558       16,049,334
                                                 ------------     ------------
       Total first mortgage loans                 119,093,910       97,970,914

Consumer and other loans
    Savings                                           373,042          396,736
    Automobile                                      2,866,956          961,613
    Home equity and second mortgages                  911,015          837,396
    Unsecured home improvement                        217,005          233,947
    Other                                             967,753          713,796
                                                 ------------     ------------

       Total consumer and other loans               5,335,771        3,143,488

Less
    Allowance for loan losses                        (752,650)        (655,745)
    Loans in process                              (10,429,123)      (6,437,204)
    Unearned discounts                                 (3,041)          (2,483)
    Deferred loan origination fees                   (351,461)        (334,712)

                                                  (11,536,275)      (7,430,144)
                                                -------------    -------------

        Net loans receivable                    $ 112,893,406    $  93,684,258
                                                =============    =============





<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998

NOTE D - LOANS RECEIVABLE - Continued

Activity in the allowance for loan losses is summarized as follows for the years
ended September 30:

                                                1999                  1998
                                                ----                  ----

      Balance at beginning of year           $  655,745           $  668,185
      Acquisition transfer                       83,834                    -
      Provision                                  66,000                    -
                                                                           -
      Loans charged off                         (52,929)             (12,440)
                                             ----------           ----------

      Balance at end of year                 $  752,650           $  655,745
                                             ==========           ==========

The  Association's  lending  efforts have  historically  focused on  one-to-four
family  residential real estate loans,  which comprise  approximately 68% (1999)
and 71%  (1998) of the total  loan  portfolio.  Approximately  3% (1999)  and 2%
(1998) of the Association's one-to-four family residential real estate loans are
collateralized  by  properties  located  outside of the primary  lending area of
Montgomery and  surrounding  Kansas  counties.  Generally,  such loans have been
underwritten  on  the  basis  of  80% to 90%  loan-to-value  ratio  or  mortgage
insurance was required.  The Association,  as with any lending  institution,  is
subject to the risk that real estate  values  could  deteriorate  in its primary
lending area thereby impairing collateral values. Management believes,  however,
that real estate values in the Association's  primary lending area are currently
stable or increasing.

During the year ended  September  30,  1998 the  Association  began  originating
construction loans at its new loan production office in Lawrence,  Kansas. These
construction   loans   generally  are  to  builders  and   individuals  for  the
construction  of residences and have terms of nine months or less with permanent
financing provided by other lenders.  Construction loans comprise  approximately
20% (1999) and 16% (1998) of the Association's total loan portfolio.


Approximately  8% (1999) and 10% (1998) of the loan  portfolio  is  comprised of
nonresidential  and multi-family real estate loans with  approximately 9% (1999)
and 10% (1998) of this total  collateralized  by properties  located outside the
Association's primary lending area.

Serviced loans,  primarily under a County Mortgage Revenue Bond, were $1,551,660
and $1,734,818 at September 30, 1999 and 1998, respectively.

In the normal  course of business,  the  Association  makes loans to  directors,
executive officers and related entities.  An analysis of aggregate loan activity
with this group is as follows:

Loans outstanding at October 1, 1998             $ 505,051
    New loans                                      182,264
    Repayments                                    (126,348)
    Existing loans to new director                  75,611
    Loans to former director                      (157,879)
                                                 ---------

Loans outstanding at September 30, 1999          $ 478,699
                                                 =========

Loan  impairment  is measured by estimating  the expected  future cash flows and
discounting  them at the  respective  effective  interest rate or by valuing the
underlying collateral.  The recorded investment in these loans and the valuation
allowance  for losses  related to loan  impairment  at September 30, 1999 are as
follows:

Principal amount of impaired loans               $ 330,129
Less valuation allowance                           (21,302)
                                                 ---------

                                                 $ 308,827
                                                 =========

Average investment in impaired loans             $ 232,426
                                                 =========



<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE D - LOANS RECEIVABLE - Continued

The Association has provided an allowance for loan losses on all impaired loans.
Interest  income of $20,345 and $16,023 was recognized and collected on impaired
loans  during the years ended  September  30, 1999 and 1998,  respectively.  The
Association  had no  impaired  loans which are not  included in smaller  balance
homogeneous home equity,  consumer and 1-4 family  residential real estate loans
at September 30, 1998. The Association is not committed to make additional loans
to borrowers whose loans have been modified.


NOTE E - ACCRUED INTEREST RECEIVABLE

Accrued interest receivable at September 30 is summarized as follows:

                                                     1999             1998
                                                     ----             ----

      Loans receivable                            $   696,175     $  576,798
      Mortgage-backed securities                       74,307        119,858
      Investment securities                           116,983         57,314
                                                  -----------     ----------

                                                  $   887,465     $  753,970
                                                  ===========     ==========


NOTE F - PREMISES AND EQUIPMENT

Premises and equipment at September 30 are summarized as follows:

                                                        1999             1998
                                                        ----             ----

      Land                                          $     74,958     $    74,958
      Building                                         1,362,870       1,319,309
      Furniture, fixtures and equipment                  539,804         458,636
      Automobiles                                         43,579          43,579
                                                    ------------     -----------

                                                       2,021,211       1,896,482
      Less accumulated depreciation                      699,083         586,849
                                                    ------------     -----------

                                                    $  1,322,128     $ 1,309,633
                                                    ============     ===========


NOTE G - REAL ESTATE OPERATIONS

A summary of real estate  operations is as follows for the years ended September
30:

                                                     1999            1998
                                                     ----            ----

      Gain on sale of real estate acquired
       through foreclos$re, net                        23,834         6,515
      Net operating loss                              (58,559)       (3,338)
                                                   ----------      --------

      Income (loss) from real estate operations    $  (34,725)     $  3,177
                                                   ==========      ========

Real estate  operations of the Association  consist primarily of paying property
taxes and general maintenance expenses on the properties held.



<PAGE>


                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE H - DEPOSITS

Deposits at September 30 are summarized as follows:

<TABLE>
<CAPTION>

                                  Weighted
                              average rate at
                               September 30,               1999                     1998
                           --------------------    --------------------    ----------------------
                             1999        1998        Amount    Percent       Amount       Percent
                             ----        ----        ------    -------       ------       -------
<S>                         <C>          <C>      <C>            <C>       <C>             <C>
      NOW accounts           2.05%       2.05%    $ 4,341,228     4.55%    $ 2,507,101      3.11%
      First Super NOW
       accounts              2.30        2.30       2,161,533     2.26       1,431,706      1.78
      First Money Fund
       accounts              4.47        4.47      26,541,536    27.81      21,952,555     27.24
                                                  -----------              -----------    ------

         Total demand
          deposits           4.05        4.15      33,044,297    34.62      25,891,362     32.13

      Passbook savings
       accounts              2.89        2.89       4,582,574     4.80       2,744,506      3.41

    Certificates of
      deposit
         3.00% to
          3.99%              3.90        3.80         212,257      .22           3,310       .01
         4.00% to
          4.99%              4.82        4.77      15,802,592    16.56       1,792,483      2.22
         5.00% to
          5.99%              5.49        5.64      36,767,612    38.52      45,363,830     56.30
         6.00% to
          6.99%              6.28        6.28       5,029,865     5.27       4,750,692      5.90
         7.00% to
          7.99%              7.00        7.00          13,667      .01          26,894       .03
                                                  -----------   ------     -----------    ------

    Total savings
      certificates           5.37        5.67      57,825,993    60.58      51,937,209     64.46
                                                  -----------   ------     -----------    ------

    Total savings            5.19        5.53      62,408,567    65.38      54,681,715     67.87
                                                  -----------   ------     -----------    ------

      Total deposits         4.79        5.09     $95,452,864   100.00%    $80,573,077    100.00%
                                                  ===========   ======     ===========    ======
</TABLE>

The  aggregate  amount of  certificates  of deposit and  savings  with a minimum
denomination of $100,000 was $5,532,226 and $4,621,272 at September 30, 1999 and
1998, respectively.


<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998

NOTE H - DEPOSITS - Continued

Scheduled maturities of certificates of deposit are as follows:

<TABLE>
<CAPTION>

September 30, 1999
------------------

                                               Less than            One to            Three to
                                               one year           three years        five years          Total
                                            --------------      -------------       -----------     ---------------
<S>                                         <C>                 <C>                 <C>             <C>
   3.00% to 3.99%                           $      212,257      $          -        $         -      $      212,257
   4.00% to 4.99%                               13,258,844          2,543,748                 -          15,802,592
   5.00% to 5.99%                               13,478,106         20,179,839          3,109,667         36,767,612
   6.00% to 6.99%                                2,267,548          2,151,544            610,773          5,029,865
   7.00% to 7.99%                                   13,667                 -                  -              13,667
                                            --------------      -------------       ------------     --------------

                                            $   29,230,422      $  24,875,131       $  3,720,440     $   57,825,993
                                            ==============      =============       ============     ==============

September 30, 1998
------------------

                                               Less than            One to            Three to
                                               one year           three years        five years          Total
                                            --------------      -------------       -----------     ---------------

   3.00% to 3.99%                           $        3,310      $          -        $         -      $        3,310
   4.00% to 4.99%                                1,792,483                 -                  -           1,792,483
   5.00% to 5.99%                               36,468,747          7,854,690          1,040,393         45,363,830
   6.00% to 6.99%                                  970,954          2,597,477          1,182,261          4,750,692
   7.00% to 7.99%                                       -              26,894                 -              26,894
                                            --------------      -------------       ------------     --------------

                                            $   39,235,494      $  10,479,061       $  2,222,654     $   51,937,209
                                            ==============      =============       ============     ==============
</TABLE>

Interest  expense on deposits for the years ended  September 30 is summarized as
follows:

                                                 1999               1998
                                                 ----               ----

      Certificates of deposit                 $  3,227,436     $  2,927,897
      Investment/Super NOW                       1,072,719        1,040,855
      Demand deposits                               89,392           41,965
                                              ------------     ------------

                                              $  4,389,547     $  4,010,717
                                              ============     ============


NOTE I - ADVANCES FROM FEDERAL HOME LOAN BANK

Advances  from the  Federal  Home  Loan  Bank at  September  30  consist  of the
following:

<TABLE>
<CAPTION>
                                                      1999                                    1998
                                         --------------------------------     ---------------------------------
                                            Rates               Amount             Rates              Amount
                                         ------------       -------------     ----------------    -------------
<S>                                      <C>                <C>                 <C>               <C>
      Variable rates                               -%       $           -       5.72%  - 6.00%    $   8,600,000
      Fixed rates                        5.65 - 7.06            9,000,000       5.65   - 7.06         9,000,000
      Fixed rate convertible*            4.63 - 5.08           18,500,000       4.87   - 5.08        12,500,000
                                                            -------------                         -------------

                                                            $  27,500,000                         $  30,100,000
                                                            =============                         =============
</TABLE>

*Due in 2008 through 2009 unless converted.





<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE I - ADVANCES FROM FEDERAL HOME LOAN BANK - Continued

The Company has a variable  rate line of credit with the Federal  Home Loan Bank
totaling $10,000,000 with no outstanding balance at September 30, 1999.

Aggregate maturities for the years following September 30, 1999 are as follows:

    2001                                     $ 3,000,000
    2002                                       5,000,000
    2003                                       1,000,000
    2008                                       2,500,000
    2009                                      16,000,000
                                             -----------

                                             $27,500,000

Assets  of  the  Association  are  subject  to a  blanket  pledge  agreement  to
collateralize the advances.


NOTE J - EMPLOYEE BENEFITS

The Corporation sponsors a leveraged employee stock ownership plan ("ESOP") that
covers all full-time employees. All employees of the Corporation are eligible to
participate  in the ESOP  after  they  attain  age 21 and  complete  one year of
service  during  which they work at least 1,000  hours.  The  Corporation  makes
annual contributions to the ESOP equal to the ESOP's debt service. All dividends
received by the ESOP are credited to the employee's stock ownership account. The
unallocated  ESOP shares are pledged as collateral  for its debt. As the debt is
repaid,  shares are released from collateral and allocated to active  employees,
based on the  proportion of debt service paid in the year.  Accordingly,  unpaid
ESOP  debt  is  reflected  as  a  deduction  from  stockholders'   equity.  ESOP
compensation expense was $178,905 and $208,752 for the years ended September 30,
1999 and 1998, respectively.

The ESOP shares as of September 30, 1999 were as follows:

              Allocated shares                       88,902
              Unreleased shares                      28,023
                                                   --------

                  Total ESOP shares                 116,925
                                                   ========
              Fair value of unreleased shares
               at September 30, 1999               $296,007
                                                   ========

Additionally,  the  Corporation  has a Recognition and Retention Plan (RRP) as a
means of providing  directors and certain key employees of the Association  with
an ownership  interest in a manner designed to compensate such directors and key
employees for services to the Corporation.  During fiscal 1994 the RRP purchased
43,642 shares of common stock.  Such shares are earned and allocated  ratably to
participants over five years. Expense under the RRP totaled $-0- and $43,634 for
the years ended September 30, 1999 and 1998, respectively.





<PAGE>


                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE J - EMPLOYEE BENEFITS - Continued

The Company has adopted a Stock Option and Incentive  Plan (SOP) for  designated
participants.  The SOP provides  for up to 145,474  shares of common stock to be
issued to participants.  The option price of any options granted may not be less
than the market  value of the  common  stock on the date of the grant and unless
otherwise specified,  the options expire ten years from the date of the grant. A
summary of the Company's stock option plan as of September 30, 1999 and 1998 and
changes during the years ended as of those dates is presented below:

                                                                   Weighted
                                                                   average
                                                                   exercise
                                                     Shares         price
                                                     -------       --------

    Outstanding at October 1, 1997                   111,822       $  5.15
       Issued                                          1,000         14.63
       Exercised                                      (6,284)         5.00
                                                    --------
    Outstanding at September 30, 1998                106,538          5.25
       Issued                                         13,409         10.06
       Exercised                                      (7,500)         5.71
       Forfeited                                      (3,000)        10.06
                                                    --------

    Outstanding at September 30,1999                 109,447       $  5.88
                                                    ========

All  options  outstanding  at  September  30,  1999  were  exercisable  and  are
summarized as follows:

                                  Exercise                 Remaining
     Shares                         price                    life
 ---------------             -----------------         --------------------

     88,902                     $   5.00               4 years
      7,136                         6.19               4 years 4 months
      2,000                         6.69               4 years 10 months
      1,000                        14.63               8 years 1 month
     10,409                        10.06               9 years 4 months
   --------

    109,447

The  stock  option  plan is  accounted  for  under APB  Opinion  25 and  related
interpretations.  Accordingly,  no compensation cost has been recognized for the
plan. Had compensation cost for the plan been determined based on the fair value
of the  options at the grant  dates  consistent  with the fair  value  method of
Statement of Financial  Accounting  Standards 123,  Accounting  for  Stock-Based
Compensation  (SFAS 123),  the Company's net earnings and earnings per share for
the years ended  September 30 would have been  reduced to the pro forma  amounts
indicated below:

                                              1999        1998
                                              ----        ----

    Net earnings - as reported             $1,143,088    $  901,420
    Net earnings - pro forma                1,074,471       894,270
    Earnings per share
    Basic - as reported                       $1.13          $.98
    Basic - pro forma                          1.06           .97
    Diluted - as reported                      1.07           .92
    Diluted - pro forma                        1.01           .91





<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998

NOTE J - EMPLOYEE BENEFITS - Continued

The fair value of each option  grant is estimated on the date of grant using the
Black-Scholes   options-pricing   model  with  the  following   weighted-average
assumptions used for the years ended September 30:

                                  1999             1998
                                  ----             ----

     Dividend yield                .87%             .51%
     Expected volatility            37%              28%
     Risk-free interest rate       5.1%             5.6%
     Expected life              10 years           10 years

The Association  participates in a defined benefit  multi-employer pension plan.
Substantially  all  employees  are  eligible  and  benefits  are  based  on  the
employee's salary and years of service.  No contribution was made or required to
be made by the  Association  for the years ended September 30, 1999 and 1998 due
to the plan's overfunded status.  Separate actuarial  disclosure  information is
not available due to the plan being a multi-employer pension plan.


NOTE K - INCOME TAXES

Income tax expense for the years ended September 30 consists of the following:

                                                        1999             1998
                                                        ----             ----

      Current                                        $   640,693      $  579,159
      Deferred                                            47,614          69,928
                                                     -----------      ----------

                                                     $   688,307      $  649,087
                                                     ===========      ==========


Reconciliation  of income tax expense computed at the federal  statutory rate of
34% and income tax expense for the years ended September 30 is as follows:

                                                        1999          1998
                                                        ----          ----

Income tax expense at statutory rate                   $622,674     $527,172
Kansas privilege tax, net of federal tax benefit         36,737       69,075
State contribution credit                                     -      (26,303)
Nondeductible ESOP fair value adjustment                 28,675       48,109
Other                                                       221       31,034
                                                       --------     --------
                                                       $688,307     $649,087
                                                       ========     ========

The tax effects of temporary  differences  that give rise to deferred tax assets
and liabilities at September 30 are as follows:

                                                        1999         1998
                                                        ----         ----
 Deferred tax assets
     Allowance for loan losses                         285,601      231,272
     Accrued bonuses                                    11,100        8,775
     Depreciation of property and equipment             95,389            -
                                                   -----------   ----------
         Total deferred tax assets                     392,090      240,047
                                                     ---------   ----------

 Deferred tax liabilities
     Securities available for sale                       1,420       32,177
     Depreciation of property and equipment                  -       37,637
     Federal Home Loan Bank stock dividends            337,588      289,302
     Other                                              53,082        7,820
                                                   -----------   ----------

         Total deferred tax liabilities                392,090      366,936
                                                   -----------   ----------

         Net deferred tax liability                $         -   $ (126,889)
                                                   ===========   ==========


<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE K - INCOME TAXES - Continued

The Association was allowed a special bad debt deduction,  generally  limited to
8% of otherwise taxable income subject to certain limitations based on aggregate
loans and deposit  account  balances at the end of the year. If the amounts that
qualify as deductions for federal income taxes are later used for purposes other
than  for  bad  debt  losses,  including  distributions  in  liquidation,   such
distributions  will be  subject  to  federal  income  taxes at the then  current
corporate  income tax rate.  Retained  earnings at September 30, 1999,  includes
approximately  $2.9  million  for  which  federal  income  taxes  have  not been
provided.  The amount of  unrecognized  deferred tax  liability  relating to the
cumulative  bad  debt   deduction  at  September  30,  1999,  is   approximately
$1,000,000.


NOTE L - STOCKHOLDERS' EQUITY AND REGULATORY CAPITAL

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

Quantitative  measures  established  by  regulation to ensure  capital  adequacy
require the Association to maintain minimum amounts and ratios (set forth in the
table below) of total and Tier 1 capital to  risk-weighted  assets and of Tier 1
(core)  capital  and  tangible  capital to  adjusted  total  assets.  Management
believes,  as of September  30,  1999,  that the  Association  meets all capital
adequacy requirements to which it is subject.

As of September 30, 1999, the most recent  notification from the OTS categorized
the Association as well  capitalized  under the regulatory  framework for prompt
corrective  action.  There are no conditions  or events since that  notification
that  management  believes  have  changed  the  Association's  category.  To  be
categorized as well  capitalized  the  Association  must maintain  minimum total
risk-based, Tier 1 risk-based and Tier 1 (core) ratios as set forth in the table
below.

<TABLE>
<CAPTION>
                                                                                    To be well
                                                                                capitalized under
                                                         For capital           prompt corrective
                                      Actual          adequacy purposes         action provisions
                                 --------------      ------------------        -----------------
                                 Amount  Ratio         Amount     Ratio           Amount   Ratio
                                 ------  -----         ------     -----           ------   -----
                                                    (Dollars in thousands)

<S>                             <C>      <C>           <C>        <C>            <C>        <C>
As of September 30, 1999
 Total risk-based capital       $12,845   19.2%        $5,354      >8.0           $6,693    >10.0%
                                                                   -                        -
 Tier 1 risk-based capital       12,092   18.1          2,677      >4.0            4,016    > 6.0
                                                                   -                        -
 Core capital                    12,092    8.8          4,142      >3.0            6,904    > 5.0
                                                                   -                        -
 Tangible capital                12,092    8.8          2,071      >1.5            N/A      N/A
                                                                   -
</TABLE>

<TABLE>
<CAPTION>
                                                                                  To be well
                                                                                capitalized under
                                                         For capital           prompt corrective
                                      Actual           adequacy purposes        action provisions
                                 --------------      -------------------       -----------------
                                 Amount  Ratio         Amount     Ratio           Amount   Ratio
                                 ------  -----         ------     -----           ------   -----
<S>                             <C>       <C>         <C>         <C>            <C>       <C>
As of September 30, 1998
 Total risk-based capital       $11,161   17.8%        $5,012      >8.0           $6,265    >10.0%
                                                                   -                        -
 Tier 1 risk-based capital       10,505   16.8          2,506      >4.0            3,759    > 6.0
                                                                   -                        -
 Core capital                    10,505    8.5          3,691      >3.0            6,152    > 5.0
                                                                   -                        -
 Tangible capital                10,505    8.5          1,846      >1.5            N/A      N/A

</TABLE>

<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998

NOTE L - STOCKHOLDERS' EQUITY AND REGULATORY CAPITAL - Continued

Regulations of the OTS impose  limitations on the payment of dividends and other
capital distributions by savings associations.  Under such regulations a savings
association  that  immediately  prior to and on a pro forma basis,  after giving
effect to a proposed capital distribution,  has total capital (as defined by OTS
regulation)  that is equal to or greater than the amount of its fully  phased-in
capital  requirement is generally permitted without OTS approval (but subsequent
to 30 days prior  notice to the OTS of the  planned  dividend)  to make  capital
distributions  during a calendar  year in the amount of up to the greater of (1)
100% of its net  earnings  to date  during  the  year  plus an  amount  equal to
one-half of the amount by which its total  capital to assets ratio  exceeded its
fully phased-in  capital to assets ratio at the beginning of the year or (2) 75%
of its net  income  for the most  recent  four  quarters.  Pursuant  to such OTS
dividend  regulations,  the  Association  had the  ability to pay  dividends  of
approximately  $4,400,000  to First  Independence  Corporation  at September 30,
1999.


NOTE M - COMMITMENTS

The Association is a party to financial  instruments with off-balance sheet risk
in the normal  course of business to meet the  financing  needs of its customers
including  commitments to extend credit.  Such commitments  involve,  to varying
degrees,  elements  of credit  and  interest-rate  risk in excess of the  amount
recognized in the consolidated  balance sheets. The contract or notional amounts
of the commitments  reflect the extent of the Association's  involvement in such
financial instruments.

The Association's  exposure to credit loss in the event of nonperformance by the
other party to the  financial  instrument  for  commitments  to extend credit is
represented  by the  contractual  notional  amount  of  those  instruments.  The
Association uses the same credit policies in making  commitments and conditional
obligations   as  those   utilized  for  on-balance   sheet   instruments.   The
Association's  commitments  to extend credit at September 30, 1999 include loans
in process as  disclosed  in Note D and first  mortgage  loans with fixed  rates
ranging from 7.25% to 10.0% aggregating $1,645,250 and $310,925 of variable rate
loans at 5.75% to 6.75%. Collateral for loans in process and commitments are the
same as for other  Association  loans.  The  commitment  period is generally for
forty-five days.


NOTE N - ACQUISITION

On  January  6,  1999,  the  Corporation  and  The  Neodesha  Savings  and  Loan
Association,  FSA  (Neodesha)  completed  the  conversion  of  Neodesha  from  a
federally-chartered mutual savings and loan association to a federally-chartered
stock  savings  and  loan  association  and its  simultaneous  merger  with  the
Association.  Neodesha  conducts  a general  banking  business  in  southeastern
Kansas. In connection with this merger conversion,  the Corporation sold 150,896
shares of its common stock a $9.42 per share.  The transaction was accounted for
under the purchase method of accounting for business combinations.  Accordingly,
the acquired  assets and  liabilities  have been recorded at their fair value at
acquisition  date and the operating  results of the  acquisition are included in
the  Corporation's   consolidated   statement  of  earnings  from  the  date  of
acquisition. The fair value of the net assets acquired in excess of the purchase
price was determined to be $1,172,848.  In accordance  with purchase  accounting
rules, $232,264 of the excess value has been used to reduce to zero the carrying
value of the acquired  property and  equipment  with the  remaining  $940,583 of
excess value  recognized as negative  goodwill.  The negative  goodwill is being
amortized to income on a ten-year  straight-line  basis. The amortization period
approximates the average life of the acquired long-term interest-bearing assets.
Amortization  of negative  goodwill  of $70,544  was  recorded in the year ended
September 30, 1999. The net unamortized balance of negative goodwill of $870,039
is included in other liabilities at September 30, 1999.

At the date of  conversion,  the merged  association  established  a liquidation
account  equal to the amount of  retained  earnings  contained  in the  offering
circular.  The  liquidation  account is maintained for the benefit of the merged
association's  eligible savings account holders who maintain deposit accounts in
the Association after conversion.




<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE N - ACQUISITION - Continued

The following summarized  unaudited pro forma financial  information assumes the
acquisition had occurred on October 1 of each year:

                                               1999               1998
                                               ----               ----

       Total interest income              $  10,341,414     $   10,119,044
       Net earnings                           1,195,162          1,094,381

       Earnings per share
         Basic                                    $1.18              $1.03
         Diluted                                   1.12                .98

In the event of a complete  liquidation (and only in such event),  each eligible
savings  account  holder  will be  entitled  to  receive a pro rata  liquidation
distribution  from the  liquidation  account in the  amount of the then  current
adjusted balance of deposit accounts held,  before any liquidation  distribution
may be made with respect to common stock. Except for the repurchase of stock and
payment of dividends, the existence of the liquidation account will not restrict
the use or application of such retained earnings by the Association.

Subsequent to consummation of the  transaction,  the Association may not declare
or pay a cash dividend on or repurchase  any of its common stock,  if the effect
thereof would cause  stockholders'  equity to be reduced below either the amount
required  for  the  combined  liquidation  accounts  or the  regulatory  capital
requirements for insured institutions.


NOTE O - FAIR VALUE OF FINANCIAL INSTRUMENTS

The following  methods and  assumptions  were used to estimate the fair value of
each class of financial instruments at September 30, 1999 and 1998.

Cash and cash  equivalents:  The  balance  sheet  carrying  amounts for cash and
short-term instruments approximate the estimated fair values of such assets.

Investment securities and mortgage-backed securities: Fair values for investment
securities and mortgage-backed  securities are based on quoted market prices, if
available.  If quoted market prices are not available,  fair values are based on
quoted market prices of comparable instruments.

Loans  receivable:  For variable  rate loans that reprice  frequently  and which
entail no  significant  change  in credit  risk,  fair  values  are based on the
carrying  values.  The  estimated  fair values of fixed rate loans are estimated
based on discounted cash flow analyses using prepayment assumptions and interest
rates  currently  offered for loans with  similar  terms to borrowers of similar
credit  quality.  Nonperforming  loans have not been  discounted.  The  carrying
amount of accrued interest receivable approximates its fair value.

Commitments  to extend  credit:  No premium or  discount  was  ascribed  to loan
commitments  because when funded virtually all funding will be at current market
rates.

Federal Home Loan Bank stock: The balance sheet carrying amount approximates the
stock's fair value.




<PAGE>




                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE O - FAIR VALUE OF FINANCIAL INSTRUMENTS - Continued

Deposit  liabilities:  The  fair  values  estimated  for  demand  deposits,  NOW
accounts, savings and certain types of money market accounts are, by definition,
equal to the  amount  payable  on  demand at the  reporting  date  (i.e.,  their
carrying  amounts).  The carrying  amounts of variable  rate,  fixed-term  money
market accounts and certificates of deposit approximate their fair values at the
reporting date. Fair values of fixed rate  certificates of deposit are estimated
using a discounted cash flow  calculation  that applies interest rates currently
being  offered  to a  schedule  of  aggregated  expected  monthly  time  deposit
maturities.  The carrying amount of accrued  interest  payable  approximates its
fair value.

Advances from Federal Home Loan Bank: For variable rate advances fair values are
considered  equal to their  carrying  values.  The estimated fair value of fixed
rate  advances  are  estimated  based on  discounted  cash flow  analysis  using
interest rates currently offered for advances with similar terms.


The following table provides summary  information on the fair value of financial
instruments.  Such  information  does not purport to represent the aggregate net
fair  value of the  Company.  Further,  the fair  value  estimates  are based on
various  assumptions,  methodologies and subjective  considerations,  which vary
widely among different  financial  institutions and which are subject to change.
The  carrying  amounts are the amounts at which the  financial  instruments  are
reported in the consolidated financial statements.

<TABLE>
<CAPTION>
                                                                1999
                                                   ----------------------------------
                                                   Carrying             Estimated
                                                   amount of            fair value
                                                   assets and           of assets and
                                                   (liabilities)        (liabilities)
                                                   -------------        -------------
<S>                                                <C>                  <C>
Cash and cash equivalents                          $    1,439,995       $   1,439,995
Investment securities available for sale                1,999,800           1,999,800
Investment securities held to maturity                  7,005,279           6,957,733
Mortgage-backed securities held to maturity            10,912,279          10,852,983
Loans                                                  113,646,056        113,489,056
Federal Home Loan Bank stock                            1,441,600           1,441,600
Deposits                                              (95,452,864)        (95,463,864)
Advances from Federal Home Loan Bank                   (27,500,000)       (26,986,000)

                                                                1998
                                                   ----------------------------------
                                                   Carrying             Estimated
                                                   amount of            fair value
                                                   assets and           of assets and
                                                   (liabilities)        (liabilities)
                                                   -------------        -------------

Cash and cash equivalents                          $      913,580       $     913,580
Investment securities available for sale                3,418,311           3,418,311
Investment securities held to maturity                  5,000,000           5,004,700
Mortgage-backed securities held to maturity            17,274,238          17,403,143
Loans                                                  94,340,003          94,885,003
Federal Home Loan Bank stock                            1,574,000           1,574,000
Deposits                                              (80,573,077)        (81,128,077)
Advances from Federal Home Loan Bank                   (30,100,000)       (30,769,000)

</TABLE>



<PAGE>



                  First Independence Corporation and Subsidiary

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

                           September 30, 1999 and 1998


NOTE P - IMPACT OF YEAR 2000

The Year 2000 issue relates to limitations in computer  systems and applications
that may prevent proper  recognition  of the Year 2000. The potential  effect of
the Year 2000 issue on the  Corporation  and its business  partners  will not be
fully   determinable   until  the  Year  2000  and  thereafter.   If  Year  2000
modifications  are not properly  completed either by the Corporation or entities
with which the Corporation  conducts  business,  the Corporation's  revenues and
financial condition could be adversely impacted.

<PAGE>
STOCKHOLDER INFORMATION

Stock Listing Information

First Federal  Savings and Loan  Association  of  Independence  converted from a
mutual to a stock savings and loan  association  effective  October 5, 1993, and
formed First  Independence  Corporation  (the  "Company")  to act as its holding
company.  The  Company's  Common  Stock  (the  "Common  Stock") is traded on the
National  Association  of  Securities  Dealers  Automated  Quotation  ("NASDAQ")
Small-Cap Market under the symbol "FFSL."

Stock Price  Information and Dividends

As of December 6, 1999, there were  approximately  224 shareholders of record of
the Company's Common Stock, not including those shares held in nominee or street
name through various  brokerage  firms or banks.

The  following  table sets forth the high and low bid prices of the Common Stock
and dividends  declared for each fiscal quarter since October 1, 1997. The stock
price  information was provided by the NASD, Inc.  Amounts have been adjusted to
reflect a two-for-one stock split in fiscal 1997.

                                                              Dividends
     Quarter Ended           High             Low             Declared
     --------------        --------         --------          ---------
December 31, 1997          $14.625          $13.625           $0.0625
March 31, 1998              15.000           13.500            0.0750
June 30, 1998               14.750           12.750            0.0750
September 30, 1998          13.250           10.000            0.0750
December 31, 1998           11.000            9.500            0.0750
March 31, 1999              11.000            9.000            0.0875
June 30, 1999               11.000            9.625            0.0875
September 30, 1999          10.750           10.125            0.0875

The Company has paid a cash  dividend on its Common Stock for each quarter since
the Association's  conversion to stock form.  Future dividends,  if any, will be
dependent upon the results of operations and financial condition of the Company,
tax considerations,  industry standards,  economic conditions,  general business
practices and other factors. The Company's ability to pay dividends is dependent
on the dividend payments it receives from the Association,  which are subject to
regulations  and the  Association's  continued  compliance  with all  regulatory
capital  requirements.  See  Note  L of  the  Notes  to  Consolidated  Financial
Statements for a discussion of regulations  governing the Association's  ability
to pay dividends.

<PAGE>

Annual Report on Form 10-KSB and Investor Information

A copy of the Company's annual report on Form 10-KSB,  filed with the Securities
and Exchange Commission, is available without charge by writing:

Gary L. Overfield
Senior Vice President and Secretary
First  Independence  Corporation
Myrtle and Sixth
Independence,  Kansas  67301

Stock Transfer Agent
Inquiries regarding stock transfer,  registration,  lost certificates or changes
in name and address should be directed to the stock transfer agent and registrar
by writing:
Registrar and Transfer Company
10 Commerce Drive
Cranford,  New Jersey 07016
(800) 368-5948

Investor Information
Stockholders,  investors,  and analysts interested in additional information may
contact:

James B.  Mitchell,
Vice President and Chief Financial Officer

Corporate Office

First Independence Corporation
Myrtle and Sixth
Independence, Kansas 67301
(316) 331-1660

Special Counsel
Silver, Freedman & Taff, L.L.P.
7th Floor - East Tower
1100 New York Avenue,  NW
Washington,  DC 20005

Independent Auditor
Grant Thornton,  LLP
8300 Thorn Drive, Suite 300
Wichita,  Kansas  67226

First Federal Savings and Loan Association of Independence
Myrtle and Sixth
Independence, Kansas 67301
(316) 331-1660

<PAGE>

<TABLE>
<CAPTION>
                        DIRECTORS AND EXECUTIVE OFFICERS

                         FIRST INDEPENDENCE CORPORATION

<S>                                                  <C>
OFFICERS                                             BOARD OF DIRECTORS
Lavern W. Strecker                                   Lavern W. Strecker
Chairman of the Board                                Chairman of the Board
                                                     First Independence Corporation and
Larry G. Spencer                                     First Federal Savings and Loan Association of Independence
President and Chief Executive Officer
                                                     Retired - Former Manager of Accounting and Control
Gary L. Overfield                                    Arco Pipe Line Company
Senior Vice President and Secretary
                                                     Larry G. Spencer
James B. Mitchell                                    President and Chief Executive Officer
Vice President and Chief Financial Officer           First Independence Corporation
                                                     President and Chief Executive Officer
                                                     First Federal Savings and Loan Association of Independence

                                                     William T. Newkirk II
                                                     Agent
                                                     Newkirk, Dennis & Buckles Insurance Co.

                                                     Robert A. Johnson
                                                     Human Resource Manger
                                                     M-E-C Company

                                                     Harold L. Swearingen
                                                     Retired - Former Telecommunications Manager
                                                     Arco Pipe Line Company

                                                     Joseph M. Smith
                                                     County Extension Agent N Agriculture and Coordinator
                                                     Montgomery County Extension Council

                                                     E. JoVonnah Boecker
                                                     City Clerk
                                                     Neodesha, Kansas
</TABLE>

<TABLE>
<CAPTION>

           FIRST FEDERAL SAVINGS AND LOAN ASSOCIATION OF INDEPENDENCE

<S>                                                  <C>
OFFICERS                                             BOARD OF DIRECTORS
Lavern W. Strecker                                   Lavern W. Strecker
Chairman of the Board
                                                     Larry G. Spencer
Larry G. Spencer
President and Chief Executive Officer                William T. Newkirk II

Gary L. Overfield                                    Harold L. Swearingen
Senior Vice President and Secretary
                                                     Joseph M. Smith
James B. Mitchell
Vice President and Chief Financial Officer           Robert A. Johnson

Jim L. Clubine                                       E. JoVonnah Boecker
Vice President and Asset Manager

Gregg S. Webster
Vice President

C. Alan Hoggatt
Vice President

Lori L. Kelley
Assistant Vice President and Compliance Officer

Betty J. Redman
Treasurer

</TABLE>