U.S. SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549

                                   FORM 10-KSB

     X    Annual report under Section 13 or 15(d) of the Securities Exchange Act
    ___  of 1934

         For the fiscal year ended December 31, 1997

   ____  Transition report under Section 13 or 15(d) of the Securities  Exchange
         Act of  1934  For  the  transition  period  from   ________________  to
          ___________________ 

Commission file number: 0-28360
                       ---------

                            IBW Financial Corporation
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                 (Name of Small Business Issuer in its Charter)

District of Columbia                            52-1943477
--------------------                            ----------
(State or other jurisdiction                (I.R.S. Employer Identification No.)
of incorporation or organization)


                  4812 Georgia Avenue, NW, Washington, DC 20011
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               (Address of Principal Executive Offices) (Zip Code)

Issuer's Telephone Number:  (202) 722-2000
                         -----------------
Securities registered under Section 12(b) of the Act: None
                                                     ---------------------------
Securities registered under Section 12(g) of the Act:

                     Common Stock, par value $1.00 per share
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                                (Title of Class)

Check whether the Issuer;  (1) filed all reports required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant  was required to file such reports;  and (2) has been
subject to such filing requirements for the past 90 days.
 Yes X No
     -   -
Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the  best  of  registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. X 
                               -

The  issuer's  revenues  for the  fiscal  year  ended  December  31,  1997  were
approximately $20,792,000.

The aggregate market value of the outstanding Common Stock held by nonaffiliates
as of February 28, 1998 was approximately $6,281,200.

As of March 15,  1997,  the number of  outstanding  shares of the Common  Stock,
$1.00 par value, of IBW Financial Corporation was 668,360.

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions  of the  Company's  Annual  Report to  Shareholders  for the Year Ended
       December 31, 1997 are incorporated by reference in part II hereof.

Portions of the Company's  definitive  Proxy Statement for the Annual Meeting of
   Shareholders to be held on April 28, 1998 are incorporated by reference in
                                part III hereof.


<PAGE>



                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS.

     IBW  Financial   Corporation,   a  District  Columbia  corporation  (the  "
Company"),  was organized in December 1994 in connection with the reorganization
of  Industrial  Bank of  Washington  ("IBW"),  a District of Columbia  chartered
commercial  bank,  to act as the one bank holding  company for IBW following the
reorganization.  On July 1, 1995, the reorganization of IBW was consummated, and
IBW was  converted  from a District  of  Columbia  chartered  bank to a national
banking  association,  under the name Industrial Bank, National Association (IBW
and Industrial Bank, National Association, generally referred to collectively as
the  "Bank"),  the main office of the Bank was  relocated  from the  District of
Columbia to Oxon Hill, Maryland,  and the Company became the holding company for
the Bank.

     The Bank, all of the shares of which are owned by the Company,  is the sole
subsidiary of the Company.

     The Bank was  organized in August 1934 as a District of Columbia  chartered
commercial bank by a group of African-American businessmen and educators for the
purpose of  providing  quality  financial  services,  with an  emphasis  on home
mortgages and automobile  financing,  to the underserved  minority population of
the District of Columbia.  Over the past sixty two years,  the Company has grown
from one office in the  District  of  Columbia  and  $250,000 in assets to seven
offices in the  District of  Columbia,  two offices in Prince  George's  County,
Maryland  and  over  $250.7  million  in  total  assets  and  $20.1  million  of
shareholders'  equity at December 31, 1997. The Bank's ninth office,  located in
the Brookland/Woodridge neighborhood of Washington, DC, opened in 1997. The Bank
is among the largest  African-American  commercial banks in the nation,  and the
only  African-American  owned  commercial  bank  based  in the  Washington  D.C.
metropolitan area.

     The  Bank  provides  a broad  range  of  commercial  and  consumer  lending
services,  including  auto loans,  home equity loans,  home  improvement  loans,
credit cards and personal loans. Over two-thirds of the Bank's loan portfolio is
real estate mortgage related,  including residential,  commercial and investment
properties.  In order to expand the ability of the Bank to offer a wide  variety
of  competitively  priced mortgage  products to the residents of the District of
Columbia  and  surrounding  areas,  the Bank has arranged to sell certain of its
mortgage loans into the secondary  market,  enabling the Bank to make additional
loans,  and loans with wider  repayment and interest rate options,  available to
the community.  Additionally,  the Bank offers a wide variety of loans geared to
meet the needs of small businesses in the Bank's market area, including accounts
receivable lines of credit,  Small Business  Administration  loans and equipment
loans.

     The Bank also provides a full range of deposit  services to its  customers,
including personal checking, low activity student checking, interest bearing NOW
accounts, golden age checking accounts for seniors,  statement savings accounts,
money market accounts,  student  accounts,  investment  certificates,  IRA's and
Christmas club accounts.  Other deposit services include 24 hour banking through
use of automated teller machines at five convenient locations.  As a part of the
Most, Plus and Network Exchange Systems,  accountholders can access ATM's across
the United State at any time.  Also the Bank provides a convenient  bank by mail
service,  direct  deposit/electronic  fund transfers,  cash management services,
safe deposit boxes, night depository,  tax deposits, wire transfers and telebanc
systems.

     The Bank has benefitted by the recent waves of consolidations  and failures
in the local banking market,  developing new customer  relationships as failures
or mergers with out of area  institutions  resulted in displaced or  disaffected
customers looking to establish local banking relationships.

     In 1994,  the Bank  established  two  branches  in the State of Maryland by
virtue of its assumption of  approximately  $38,000,000  in deposit  liabilities
relating to two branches of John Hanson  Federal  Savings Bank, a failed savings
association  under  the  conservatorship  of the RTC,  located  in Oxon Hill and
Forestville, Maryland.

     As a minority  institution,  the Bank was entitled to obtain the use of the
branch facility at 1900 John Hanson Lane, Oxon Hill Maryland, which was owned by
John  Hanson,  rent-free  for a  period  of  five  years  from  the  date of 



<PAGE>


the transaction, and received an option to purchase the facility during the term
of the lease at 95% of fair market  value.  The Company  obtained  $1,000,000 of
interim capital  assistance from the Resolution Trust Company as a result of its
successful bid for the John hanson  branches.  Interim  capital  assistance is a
loan for a period of up to five years at a below market  interest  rate equal to
the end of the  calendar  quarter  Monday  Auction  yield price for 13 week U.S.
Treasury Bills, as reported by the Wall Street Journal,  plus 12.5 basis points,
or approximately 5.187% as of December 31, 1997, subject to periodic adjustment.
The Company's  interim  capital  assistance  loan is due July 3, 2000.  The loan
documentation   relating  to  the  interim  capital  assistance  places  certain
restrictions  on the  activities  of the Bank and  Company,  including,  but not
limited  to,  engaging  in loan  transactions  with  affiliates  of the  Bank or
Company, salary increases and bonuses to directors,  officers and key employees,
the  payment  of  dividends,  and  the  maintenance  of  capital  levels.  These
restrictions are discussed in greater detail elsewhere herein.  The stock of the
Bank stands as  collateral  security for the loan.  In the event of a default by
the Company under the terms of the interim capital  assistance loan and security
agreements,  including but not limited to a failure to make any required payment
on the  interim  capital  assistance  loan,  the  inaccuracy  when  made  of any
representation or warranty in the agreements,  the failure of the Company or the
Bank to perform  or  observe  in any  material  respect  any term,  covenant  or
agreement in the agreements,  certain  bankruptcy or insolvency  related events,
and any event  which  gives the RTC,  in its  judgement,  reasonable  grounds to
believe  that the  Company or the Bank will not,  or will be unable to repay the
interim  capital  assistance  loan  as  required  or to  otherwise  perform  its
obligations in connection  therewith,  then,  subject to the Company's  right to
cure the default,  the outstanding  principal of the loan may be accelerated and
declared due and payable,  and the stock of the Bank may be sold.  Additionally,
the failure to make any payment of principal or interest when due, if not timely
cured, constitutes grounds for, and the Company's and the Bank's consent to, the
appointment of a receiver or conservator for the Bank.

SALE OF ADDITIONAL SHARES

     On September 29, 1997,  the Company  completed the sale of 31,200 shares of
its common stock and 20,000 shares of its Series A Non-Voting  Preferred  Stock,
in a private placement transaction, to the Federal National Mortgage Association
("Fannie  Mae"),  at a price of $25.00 per share of common  stock and $25.00 per
share of Series A  Non-Voting  Preferred  Stock (the shares of common  stock and
shares of Series A  Non-Voting  Preferred  Stock sold to Fannie Mae  referred to
collectively herein as the "Shares"),  for a total purchase price of $1,280,000,
pursuant to an  agreement  dated  August 15,  1997.  The shares of common  stock
issued to Fannie Mae represent  approximately 4.67% of the outstanding shares of
the  Company's  common  stock,  and the shares of Series A Non-Voting  Preferred
Stock  represent  all of the  authorized  shares of that  series.  The  Series A
Non-Voting  Preferred Stock, which is redeemable at any time by the Company at a
redemption  price of $25.00  plus  accrued but unpaid  dividends  to the date of
redemption, is entitled to annual dividends at a rate of five percent.

     Under the stock purchase  agreement,  the Company is restricted from taking
any action,  including  the  repurchase,  redemption  or other  reduction in the
number of outstanding  shares of capital stock, but not including the incurrence
of losses,  which would  result in the value of the Shares  representing  10% or
more of the equity of the Company,  or the shares of common stock sold to Fannie
Mae  representing  5% or more of the outstanding  common stock.  The Company has
certain  rights under the  agreement  to  repurchase  the Shares  under  certain
circumstances.

     The sale of shares  to  Fannie  Mae was  effected  as part of Fannie  Mae's
program to make investments in community  oriented and minority  institutions to
encourage  and  facilitate   housing  related  lending  and  affordable  housing
initiatives.

MARKET AREA AND COMPETITION

     The Bank's  primary  market area consists of the District of Columbia,  and
Prince George's County,  Maryland. The Washington Metropolitan Statistical Area,
(the  "Washington  MSA"),  of which the Bank's  market  area forms a part,  is a
highly  competitive  one,  in which a large  number of  regional  and  national,
majority owned and managed, multi-bank holding companies operate, in addition to
numerous small and medium sized community banks. Additionally, a large number of
thrift   institutions  and  non-bank  financial  service  providers,   including

                                      -2-
<PAGE>


insurance  companies,   brokerage  firms,  credit  unions,  mortgage  companies,
consumer  finance   companies,   mutual  funds  and  other  types  of  financial
institutions  compete in the Washington  MSA for investment  dollars and lending
business.  As a result of  changes  in federal  and state  banking  legislation,
competitors not already in the Bank's market may seek to enter such market.  The
District of  Columbia,  Maryland  and  Virginia  have each  enacted  legislation
permitting  banks  organized  or based in other  jurisdictions  to  establish or
acquire banks or branches in such jurisdictions.

     Notwithstanding the foregoing,  Prince George's County has been the subject
of hearings before the House of  Representatives  Committee on Banking,  Finance
and Urban Affairs  regarding the relative  unavailability of banking services in
that county.  Prince George's County,  which has a majority minority population,
was  found to have  approximately  half as many  traditional  banking  or thrift
branches  per  capita as  neighboring  Montgomery  County,  which has a majority
non-minority population.  Prince George's was also found to have a substantially
higher  number  of  non-traditional  banking  entities,  such as  check  cashing
outlets.  The Company believes that Prince George's County provides  substantial
opportunity for growth and expansion.

     The Washington MSA had a 1990 population of approximately 1.8 million,  and
total employment in 1991 of 954,000. Employment is primarily provided by federal
and local  governments,  the  finance,  insurance  and real  estate  industries,
retailing,  construction  and  education.  Per capita income in 1991 amounted to
approximately $25,000.

EMPLOYEES

     As of December 31, 1997,  the Bank had 155 full time  employees  and 6 part
time employees.  None of the Bank's  employees are represented by any collective
bargaining  group,  and the Bank believes that its employee  relations are good.
The Bank provides a benefit program which includes health and dental  insurance,
life and long term disability insurance and an employee stock ownership plan for
substantially  all full time  employees.  Annual  contributions  to the employee
stock  ownership  plan are  determined by the Board,  and amounted to $39,100 in
1997,  $37,000  in 1996 and  $75,000  in  1995.  The  Company  does not have any
employees who are not also employees of the Bank.

     Under the terms of the  interim  capital  assistance,  the  Company may not
increase the  compensation  of, or pay any bonus to, its directors,  officers or
key  employees,  except that it may make such  increases or payments  during and
after the second year of operation following the interim capital assistance with
the prior  consent of the  Federal  Deposit  Insurance  Corporation  ("FDIC") as
successor to the RTC.

REGULATION

     The following summaries of statutes and regulations  affecting bank holding
companies  do not  purport to be  complete  discussions  of all  aspects of such
statutes and regulations and are qualified in their entirety by reference to the
full text thereof.

     Holding  Company  Regulation.  The  Company is a  registered  bank  holding
company under the Bank Holding Company Act of 1956, as amended (the "BHCA").  As
a  registered  bank  holding  company,  the Company is required to file with the
Board of Governors  of the Federal  Reserve  (the  "Federal  Reserve") an annual
report,  certain periodic reports and such reports and additional information as
the  Federal  Reserve  may  require  pursuant  to the BHCA,  and is  subject  to
examination and inspection by the Federal Reserve.

     BHCA - Activities and Other Limitations.  The BHCA prohibits a bank holding
company from acquiring  direct or indirect  ownership or control of more than 5%
of the voting shares of any bank, or increasing such ownership or control of any
bank, without prior approval of the Federal Reserve.

                                       -3

<PAGE>



     The BHCA also prohibits a bank holding  company,  with certain  exceptions,
from  acquiring  more than 5% of the voting  shares of any company that is not a
bank and from  engaging  in any  business  other  than  banking or  managing  or
controlling  banks. Under the BHCA, the Federal Reserve is authorized to approve
the ownership of shares by a bank holding company in any company, the activities
of which the Federal  Reserve has determined to be so closely related to banking
or to managing  or  controlling  banks as to be a proper  incident  thereto.  In
making  such  determinations,  the  Federal  Reserve  is  required  to weigh the
expected  benefit  to  the  public,  such  as  greater  convenience,   increased
competition or gains in efficiency,  against the possible adverse effects,  such
as undue concentration of resources, decreased or unfair competition,  conflicts
of interest or unsound banking practices.

     The Federal Reserve has by regulation  determined  that certain  activities
are closely related to banking within the meaning of the BHCA.  These activities
include:  making or servicing loans such as would be made by a mortgage company,
consumer finance company, credit card company, or factoring company;  performing
trust  company  functions;   performing  certain  data  processing   operations;
providing  limited  securities  brokerage  services;  acting as an investment or
financial advisor; ownership or operation of a savings association; acting as an
insurance agent for certain types of credit-related insurance;  leasing personal
property on a  full-payout,  non-operating  basis;  providing  tax  planning and
preparation  services;  operating a collection  agency;  and  providing  certain
courier  services.  The Federal  Reserve also has determined  that certain other
activities,  including real estate brokerage and syndication,  land development,
property  management  and  underwriting  life  insurance  not  related to credit
transactions, are not closely related to banking and a proper incident thereto.

     Commitments to Subsidiary Banks.  Under Federal Reserve policy, the Company
is expected to act as a source of  financial  strength to the Bank and to commit
resources  to support the Bank in  circumstances  when it might not do so absent
such policy.

     Limitations  of  Acquisitions  of Common Stock.  The federal Change in Bank
Control  Act  prohibits  a person or group from  acquiring  "control"  of a bank
holding company unless the Federal Reserve has been given 60 days' prior written
notice of such  proposed  acquisition  and within  that time  period the Federal
Reserve  has not  issued a  notice  disapproving  the  proposed  acquisition  or
extending  for up to another 30 days the period  during which such a disapproval
may be issued. An acquisition may be made prior to expiration of the disapproval
period  if the  Federal  Reserve  issues  written  notice of its  intent  not to
disapprove the action. Under a rebuttable presumption established by the Federal
Reserve,  the  acquisition  of 10% or more of a class of voting  stock of a bank
holding  company with a class of securities  registered  under Section 12 of the
Exchange  Act  would,  under the  circumstances  set  forth in the  presumption,
constitute the acquisition of control.

     In addition,  with limited  exceptions,  any "company" would be required to
obtain the approval of the Federal  Reserve under the BHCA before  acquiring 25%
(5% in the case of an acquiror  that is a bank  holding  company) or more of the
outstanding  Common  Stock of,  or such  lesser  number of shares as  constitute
control over, the Company.  Such approval would be contingent  upon, among other
things,  the acquiror  registering  as a bank  holding  company,  divesting  all
impermissible  holdings and ceasing any  activities not  permissible  for a bank
holding company.

     The Federal Reserve has adopted  capital  adequacy  guidelines  pursuant to
which it assesses the adequacy of an institution's capital. These guidelines are
substantially  identical  to those which are  applicable  to the Bank  discussed
below.

     Bank  Regulation.   The  Bank  is  subject  to  extensive   regulation  and
examination  by the Office of the  Comptroller  of  Currency  ("OCC") and by the
FDIC,  which  insures its deposits to the maximum  extent  permitted by law. The
federal laws and  regulations  which are applicable to national banks  regulate,
among  other  things,  the scope of their  business,  their  investments,  their
reserves against deposits, the timing of the availability of deposited funds and
the nature and amount of collateral for certain loans.  The laws and regulations
governing the Bank generally have been promulgated to protect depositors and the
deposit insurance funds, and not for the purpose of protecting stockholders.

                                      -4-

<PAGE>


     FDIC  Insurance  Premiums.  The Bank pays deposit  insurance  premiums as a
member of the Bank  Insurance  Fund of the FDIC,  under  the  FDIC's  risk-based
assessment system.  Under the FDIC's  regulations,  institutions are assigned to
one of three  capital  groups  based  solely on the  level of the  institution's
capital - "well capitalized,"  "adequately capitalized" and "undercapitalized" -
which would be defined in the same manner as the  regulations  establishing  the
prompt  corrective  action  system  under  Section  38 of  the  Federal  Deposit
Insurance  Act (the  "FDIA"),  as discussed  below.  These three groups are then
divided  into  three  subgroups  which  reflect  varying  levels of  supervisory
concern,  from those  which are  considered  to be  healthy  to those  which are
considered  to be of  substantial  supervisory  concern.  The  matrix so created
results in nine assessment risk  classifications,  with rates currently  ranging
from 0% to .31% of insured  deposits.  During 1996, the Bank incurred a one time
expense of approximately  $158,000 relating to the special assessment imposed on
deposits insured by the Savings Association  Insurance Fund of the FDIC ("SAIF")
in  connection  with the  recapitalization  of the SAIF  fund.  The Bank is also
required to pay an additional assessment in connection with the repayment of the
"Fico bonds"  issued in connection  with the  resolution of the savings and loan
crisis.

     Capital Adequacy Guidelines. The Federal Reserve, the OCC and the FDIC have
all adopted risk based capital adequacy guidelines pursuant to which they assess
the  adequacy of capital in  examining  and  supervising  banks and bank holding
companies and in analyzing  bank  regulatory  applications.  Risk-based  capital
requirements,  determine  the adequacy of capital  based on the risk inherent in
various classes of assets and off-balance sheet items.

     National  banks are  required to meet a minimum  ratio of total  qualifying
capital (the sum of core capital (Tier 1) and supplementary capital (Tier 2)) to
risk  weighted  assets of 8%. At least half of this amount (4%) should be in the
form of core capital. These requirements apply to the Bank and will apply to the
Company (a bank holding company) so long as its total assets equal  $150,000,000
or more.

     Tier 1 Capital for national banks  generally  consists of the sum of common
stockholders'  equity and perpetual  preferred stock (subject in the case of the
latter to limitations on the kind and amount of such stock which may be included
as Tier 1 Capital),  less goodwill,  without  adjustment for unrealized  gain or
loss on securities  classified as available for sale in accordance with FAS 115.
Tier 2 Capital consists of the following: hybrid capital instruments;  perpetual
preferred  stock  which  is not  otherwise  eligible  to be  included  as Tier 1
Capital;  term  subordinated  debt and  intermediate-term  preferred stock; and,
subject to limitations,  general allowances for loan losses. Assets are adjusted
under  the   risk-based   guidelines  to  take  into  account   different   risk
characteristics,  with the  categories  ranging from 0% (requiring no risk-based
capital)  for  assets  such as cash,  to 100% for the bulk of  assets  which are
typically  held  by a  bank  holding  company,  including  certain  multi-family
residential  and  commercial  real estate loans,  commercial  business loans and
consumer  loans.  Residential  first  mortgage  loans  on  one  to  four  family
residential  real  estate and certain  seasoned  multi-family  residential  real
estate loans, which are not 90 days or more past-due or non-performing and which
have been made in accordance with prudent underwriting  standards are assigned a
50%  level  in  the  risk-weighing  system,  as  are  certain   privately-issued
mortgage-backed  securities  representing  indirect  ownership  of  such  loans.
Off-balance  sheet items also are  adjusted to take into  account  certain  risk
characteristics.

         In  addition  to the  risk  based  capital  requirements,  the  OCC has
established  a minimum  3.0%  Leverage  Capital  Ratio  (Tier 1 Capital to total
adjusted assets)  requirement for the most highly-rated  national banks, with an
additional  cushion of at least 100 to 200 basis  points for all other  national
banks,  which effectively  increases the minimum Leverage Capital Ratio for such
other banks to 4.0% - 5.0% or more. Under the OCC's  regulations,  highest-rated
banks are those that the OCC determines  are not  anticipating  or  experiencing
significant  growth and have well diversified risk,  including no undue interest
rate risk exposure,  excellent asset quality, high liquidity, good earnings and,
in general, those which are considered a strong banking organization. A national
bank having less than the minimum  Leverage  Capital  Ratio  requirement  shall,
within 60 days of the date as of which it fails to comply with such requirement,
submit  to the  applicable  OCC  district  office  for  review  and  approval  a
reasonable  plan describing the means and timing by which the bank shall achieve
its minimum Leverage Capital Ratio  requirement.  A national bank which fails to
file such plan with the OCC is deemed to be  operating  in an unsafe and unsound
manner, and

                                      -5-

<PAGE>


could  subject  the bank to a  cease-and-desist  order  from the OCC.  The OCC's
regulations also provide that any insured depository institution with a Leverage
Capital  Ratio that is less than 2.0% is deemed to be  operating in an unsafe or
unsound  condition  pursuant  to  Section  8(a) of the  FDIA and is  subject  to
potential  termination of deposit insurance.  However,  such an institution will
not be subject to an enforcement proceeding thereunder, solely on account of its
capital  ratios,  if it has  entered  into and is in  compliance  with a written
agreement  with the OCC to increase its Leverage  Capital Ratio to such level as
the OCC deems  appropriate and to take such other action as may be necessary for
the  institution  to be  operated  in a safe and sound  manner.  The OCC capital
regulations also provide, among other things, for the issuance by the OCC or its
designee(s) of a capital directive, which is a final order issued to a bank that
fails to  maintain  minimum  capital or to restore  its  capital to the  minimum
capital   requirement  within  a  specified  time  period.   Such  directive  is
enforceable in the same manner as a final cease-and-desist order.

     Additionally,  the interim capital  assistance loan agreement  requires the
Bank to maintain a 5.22% "tangible"  capital level. This covenant of the interim
capital  assistance  agreement  does not  constitute a written  capital order or
directive for purposes of prompt corrective action.

     At December 31, 1997, the Bank was in compliance  with all minimum  federal
regulatory  capital  requirements  which are  generally  applicable  to national
banks, as well as the capital requirements of the interim capital assistance. As
of such date,  the Bank had a Tier 1 Risk Based  Capital  Ratio and a Total Risk
Based Capital Ratio equal to 15% and 17%  respectively,  and a Leverage  Capital
Ratio equal to 8%.

     Prompt Corrective Action. Under Section 38 of the FDIA, the federal banking
agencies  have  promulgated  substantially  similar  regulations  to implement a
system of prompt  corrective  action.  Under the  regulations,  a bank  shall be
deemed to be: (i) "well  capitalized" if it has a Total Risk Based Capital Ratio
of 10.0% or more, a Tier 1 Risk Based  Capital Ratio of 6.0% or more, a Leverage
Capital Ratio of 5.0% or more and is not subject to any written capital order or
directive;  (ii)  "adequately  capitalized" if it has a Total Risk Based Capital
Ratio of 8.0% or more, a Tier 1 Risk Based  Capital  Ratio of 4.0% or more and a
Tier 1 Leverage Capital Ratio of 4.0% or more (3.0% under certain circumstances)
and does not meet the definition of "well capitalized;" (iii) "undercapitalized"
if it has a Total Risk Based Capital Ratio that is less than 8.0%, a Tier 1 Risk
based Capital  Ratio that is less than 4.0% or a Leverage  Capital Ratio that is
less  than  4.0%  (3.0%  under  certain   circumstances);   (iv)  "significantly
undercapitalized"  if it has a Total Risk Based  Capital Ratio that is less than
6.0%,  a Tier 1 Risk  Based  Capital  Ratio that is less than 3.0% or a Leverage
Capital Ratio that is less than 3.0%; and (v) "critically  undercapitalized"  if
it has a ratio of tangible  equity to total assets that is equal to or less than
2.0%.

     An institution generally must file a written capital restoration plan which
meets specified  requirements with an appropriate  federal banking agency within
45 days of the date the institution  receives notice or is deemed to have notice
that  it  is  undercapitalized,  significantly  undercapitalized  or  critically
undercapitalized.  A federal  banking agency must provide the  institution  with
written  notice of  approval  or  disapproval  within 60 days after  receiving a
capital restoration plan, subject to extensions by the applicable agency.

     An institution which is required to submit a capital  restoration plan must
concurrently  submit a  performance  guaranty by each company that  controls the
institution. Such guaranty shall be limited to the lesser of (i) an amount equal
to 5.0% of the  institution's  total  assets  at the  time the  institution  was
notified  or  deemed to have  notice  that it was  undercapitalized  or (ii) the
amount  necessary at such time to restore the relevant  capital  measures of the
institution  to the levels  required for the  institution  to be  classified  as
adequately  capitalized.  Such a guaranty shall expire after the federal banking
agency notifies the institution that it has remained adequately  capitalized for
each of four consecutive calendar quarters. An institution which fails to submit
a written capital  restoration plan within the requisite  period,  including any
required performance  guaranty,  or fails in any material respect to implement a
capital  restoration plan, shall be subject to the restrictions in Section 38 of
the FDIA which are applicable to significantly undercapitalized institutions.

                                      -6-

<PAGE>



     A   "critically   undercapitalized   institution"   is  to  be   placed  in
conservatorship  or  receivership  within  90  days  unless  the  FDIC  formally
determines  that  forbearance  from such action would better protect the deposit
insurance fund. Unless the FDIC or other appropriate  federal banking regulatory
agency makes specific  further  findings and certifies  that the  institution is
viable and is not  expected to fail,  an  institution  that  remains  critically
undercapitalized on average during the fourth calendar quarter after the date it
becomes critically undercapitalized must be placed in receivership.  The general
rule and  current  position  of the OCC is that the FDIC  will be  appointed  as
receiver within 90 days after a bank becomes critically  undercapitalized unless
extremely  good cause is shown and an extension is agreed to between the OCC and
the FDIC. In general, good cause is defined as capital which has been raised and
is imminently  available for infusion into the Bank except for certain technical
requirements which may delay the infusion for a period of time beyond the 90 day
time period.

     Immediately  upon becoming  undercapitalized,  an institution  shall become
subject to the provisions of Section 38 of the FDIA,  which (i) restrict payment
of capital  distributions and management fees; (ii) require that the appropriate
federal  banking agency monitor the condition of the institution and its efforts
to restore its capital;  (iii) require submission of a capital restoration plan;
(iv)  restrict the growth of the  institution's  assets;  and (v) require  prior
approval of certain expansion proposals.  The appropriate federal banking agency
for an  undercapitalized  institution  also may take any number of discretionary
supervisory  actions  if the  agency  determines  that any of these  actions  is
necessary  to resolve the  problems  of the  institution  at the least  possible
long-term  cost to the  deposit  insurance  fund,  subject in  certain  cases to
specified procedures. These discretionary supervisory actions include: requiring
the  institution to raise  additional  capital;  restricting  transactions  with
affiliates;  requiring  divestiture  of  the  institution  or  the  sale  of the
institution to a willing  purchaser;  and any other supervisory  action that the
agency  deems  appropriate.   These  and  additional  mandatory  and  permissive
supervisory actions may be taken with respect to significantly  undercapitalized
and critically undercapitalized institutions.

     Additionally, under Section 11(c)(5) of the FDIA, a conservator or receiver
may be appointed for an  institution  where:  (i) an  institution's  obligations
exceed its assets;  (ii) there is substantial  dissipation of the  institution's
assets or earnings as a result of any  violation of law or any unsafe or unsound
practice; (iii) the institution is in an unsafe or unsound condition; (iv) there
is a willful  violation of a  cease-and-desist  order;  (v) the  institution  is
unable to pay its obligations in the ordinary course of business; (vi) losses or
threatened losses deplete all or substantially all of an institution's  capital,
and there is no reasonable prospect of becoming "adequately capitalized" without
assistance; (vii) there is any violation of law or unsafe or unsound practice or
condition  that is likely to cause  insolvency  or  substantial  dissipation  of
assets or earnings,  weaken the institution's  condition, or otherwise seriously
prejudice  the  interests  of  depositors  or  the  insurance  fund;  (viii)  an
institution ceases to be insured;  (ix) the institution is undercapitalized  and
has no reasonable prospect that it will become adequately capitalized,  fails to
become  adequately  capitalized  when  required  to do so, or fails to submit or
materially  implement a capital  restoration  plan;  or (x) the  institution  is
critically undercapitalized or otherwise has substantially insufficient capital.

     At December 31, 1997,  the Bank was a "well  capitalized"  institution  for
purposes of Section 38 of the FDIA.

     Regulatory Enforcement Authority.  The enforcement authority of the federal
banking  regulators  includes,  among other things,  the ability to assess civil
money  penalties,  to issue  cease-and-desist  or removal orders and to initiate
injunctive  actions against  banking  organizations  and  institution-affiliated
parties.  In general,  these enforcement actions may be initiated for violations
of laws and  regulations  and  unsafe or  unsound  practices.  Other  actions or
inactions may provide the basis for enforcement action,  including misleading or
untimely reports filed with regulatory authorities.

                                      -7-

<PAGE>



ITEM 2. DESCRIPTION OF PROPERTY.

     The  Bank  currently  operates  nine  offices,  seven  in the  District  of
Columbia, and two in Prince George's County,  Maryland. The Bank owns its office
located at 4812 Georgia Avenue, N.W. and its branch offices located at 2000 11th
Street, NW and 45th and Blaine Streets,  NE. The Georgia Avenue office, which is
also the principal  executive office of the Company,  consists of a 6,000 square
foot stand alone building with drive-in facilities,  and a separate 2,000 square
foot building  housing the Bank's  operations  center next door. The 11th Street
office is housed in a 4,000 square foot  building,  and an adjacent 2,000 square
foot  building  houses the loan  operations  center.  The Blaine  Street  office
occupies an approximately 2,000 square foot stand alone building,  with drive-in
facilities,  near the Benning Road Metro Station.  The Bank leases the remainder
of its offices.  The 14th and U Streets office is located in a 1,922 square foot
storefront,  under a lease which  commenced in 1988, for a ten year term and one
optional ten year renewal term at a fixed rent of $28,830 per year. The Bank's F
Street  office  is  located  in a 1,273  square  foot  storefront  under a lease
commencing  in 1991,  for a ten year term at a current  annual  rent of $68,731,
subject to annual increases.  The American University office is located in a 962
square foot  storefront  under a five year lease,  which commenced in 1992, with
one five year renewal  option,  at a current annual rent of $24,756,  subject to
annual increase.  The Forestville,  Maryland office is located in a 2,696 square
foot  storefront with drive-in  facilities,  and is occupied under a lease which
commenced  in 1994 for a five year term at a current  annual  rental of $29,008,
subject to annual increase.  The Oxon Hill office,  the main office of the Bank,
is a 10,531 square foot,  two story  building with drive in  facilities,  and is
occupied rent free for a term extending  until June 10, 1999 and is subject to a
purchase option at 95% of fair market value.  The Company is responsible for all
operating   and   maintenance   expenses   on  the  Oxon  Hill   property.   The
Brookland/Woodridge  office,  which  opened in 1997,  is  located  in 2610 Rhode
Island Avenue, NE and occupied under a lease,  commencing in 1997, with one five
year  renewal  options,  for a five  year  term at a  current  annual  rental of
$27,000, subject to annual increases.

     The Company  believes that its existing  facilities are adequate to conduct
its business.

ITEM 3. LEGAL PROCEEDINGS.

     The Company is involved in routine legal proceedings in the ordinary course
of its  business.  In the  opinion of  management,  final  disposition  of these
proceedings will not have a material  adverse effect on the financial  condition
or results of operations of the Company.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     No matters were  submitted to a vote of security  holders during the fourth
quarter of the year ended December 31, 1997.


                                     PART II


ITEM 5. MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS.

MARKET FOR COMMON STOCK AND DIVIDENDS

     There does not  currently  exist an  organized  public  trading  market for
shares of Company's Common Stock. Trading in the Company's Common Stock has been
sporadic,  and consists of private trades conducted without brokers. The Company
is aware of 18 trades of the Common  Stock  since  January  1,  1996,  at prices
ranging from $18.00 to $25.00 per share. The last trade known to the Company was
a trade of 666 shares at $20 per share on February 27,  1998. There may be other
trades of which the  Company is either not aware,  or with  respect to which the
Company is not aware of the price. Additionally, as discussed above, the Company
sold 31,200 newly issued shares of Common  Stock,  and 20,000 shares of Series A
Non-Voting  Preferred  Stock,  to Fannie Mae, at a price of $25.00 per share, on
September  29,  1997 the  high  sale  price  for the  year).  These  trades  and
transactions do not necessarily reflect the intrinsic or

                                      -8-

<PAGE>



market values of the Common Stock.  As of December 31, 1997,  there were 668,360
shares  of  Common  Stock  outstanding,  held of  record  by  approximately  560
shareholders.

     The Company  and,  during the period prior to July 1, 1995,  the Bank,  has
paid semi-annual dividends for each of the last ten years, and currently intends
to continue the payment of such dividends.  There can be no assurance,  however,
that  the  Bank  or the  Company  will  continue  to  have  earnings  at a level
sufficient  to support the payment of  dividends,  or that either entity will in
the  future  elect to pay  dividends.  Under  the terms of the  interim  capital
assistance  agreement,  the Bank may not, during the term of the interim capital
assistance  loan, pay any dividends or repurchase  any Common Stock,  unless (i)
there is no default under the interim capital  assistance  agreement and related
note;  (ii) payment of such  dividends  would not result in an event of default;
and (iii) the payment of such  dividend is not  prohibited or objected to by the
OCC. As the Bank is the primary  source of funds for payment of dividends by the
Company,  the inability of the Bank to pay dividends could adversely  affect the
ability of the  Company to pay  dividends.  As of the date  hereof,  there is no
event of default under the interim capital assistance documents.

     Dividends on the Common Stock are subject to the prior payment of dividends
on the Series A Preferred Stock.

     Set forth below is certain financial  information relating to the Company's
and Bank's  dividend  history  for the past five  fiscal  years (as  adjusted to
reflect the 5-for-1  stock  split in the form of a stock  dividend  paid in July
1994.) Information for periods prior to July 1, 1995 reflect Bank information.

<TABLE>
<CAPTION>
                                                        Year Ended December 31,

                                               ----------- ---------- ----------- ----------- ----------
                                                  1997       1996        1995     1994        1993
                                               ----------- ---------- ----------- ----------- ----------
<S>                                            <C>         <C>        <C>         <C>         <C>  
Net income per common share                    $2.44       $2.06      $2.56       $1.99       $3.12
Dividends paid per common share                $ .60       $ .60      $ .60       $ .60       $ .50
Ratio of dividends to net income available

to common shareholders                         24.59%      29.13%     23.44%      30.15%      16.03%
----------------------------------------------
</TABLE>

     The payment of dividends by the Company depends largely upon the ability of
the Bank to declare and pay dividends to the Company, as the principal source of
the  Company's  revenue is dividends  paid by the Bank.  Future  dividends  will
depend primarily upon the Bank's  earnings,  financial  condition,  and need for
funds,  as well as  governmental  policies  and  regulations  applicable  to the
Company and the Bank.

     Regulations  of the OCC place a limit on the amount of  dividends  the Bank
may pay to the Company  without  prior  approval.  Prior  approval of the OCC is
required to pay  dividends  which  exceed the Bank's net profits for the current
year plus its retained net profits for the  preceding two calendar  years,  less
required  transfers to surplus.  At December 31, 1997, the amount  available for
the payment of dividends  without prior approval was  approximately  $2,108,000.
The  Federal  Reserve  and the OCC also have  authority  to prohibit a bank from
paying  dividends if the Federal  Reserve or the OCC deems such payment to be an
unsafe or unsound practice.

     The  Federal  Reserve  has  established  guidelines  with  respect  to  the
maintenance  of  appropriate  levels  of  capital  by  registered  bank  holding
companies.  Compliance with such standards,  as presently in effect,  or as they
may be amended from time to time,  could  possibly limit the amount of dividends
that the Company may pay in the future.  In 1985,  the Federal  Reserve issued a
policy statement on the payment of cash dividends by bank holding companies.  In
the statement,  the Federal  Reserve  expressed its view that a holding  company
experiencing earnings weaknesses

                                      -9-

<PAGE>


should not pay cash dividends  exceeding its net income,  or which could only be
funded in ways that weakened the holding company's  financial health, such as by
borrowing.

     As a depository institution, the deposits of which are insured by the FDIC,
the Bank may not pay dividends or distribute  any of its capital assets while it
remains in default on any  assessment due the FDIC. The Bank currently is not in
default under any of its obligations to the FDIC.

RECENT SALES OF UNREGISTERED SHARES.

     During  the past  three  years,  the  Company  has not sold any  securities
without  registration  under the Securities Act of 1933,  except for the initial
issuance of shares of the Company's  Common Stock, par value $1.00 per share, as
of July 1, 1995, in connection with the  establishment of the Company as the one
bank  holding  company  for the Bank.  The  Company  relied  upon the  exemption
provided by Section  3(a)(12) of the Securities Act of 1933. In connection  with
that reorganization transaction, each share of outstanding Bank Common Stock was
converted into one share of Company Common Stock, and each shareholder  retained
the same percentage ownership interest in the Company as such shareholder had in
the  Bank.  No shares  of  Company  Common  Stock or other  authorized  class of
securities were sold for cash, and involved no underwriter, broker or dealer was
involved  in  connection  with the  reorganization  and  conversion  of  shares.
Additionally,  On September 29, 1997,  the Company  completed the sale of 31,200
shares  of its  Common  Stock,  and  20,000  shares of its  Series A  Non-Voting
Preferred  Stock in a private  placement  transaction,  to the Fannie  Mae, at a
price of  $25.00  per share of Common  Stock  and  $25.00  per share of Series A
Non-Voting  Preferred Stock,  pursuant to an agreement dated August 15, 1997. No
underwriter,  broker or dealer was involved in the sale of shares to Fannie Mae.
The Company relied upon the exemption provided by Section 4(2) of the Securities
Act of 1933,  as amended.  The sale of shares to Fannie Mae was effected as part
of Fannie Mae's program to make  investments in community  oriented and minority
institutions to encourage and facilitate  housing related lending and affordable
housing  initiatives.  The purchase was  privately  negotiated,  directly by the
parties and no public solicitation was used.

     Prior to  establishment of the Company as the holding company for the Bank,
between December 1994 and June 1995, the Bank effected the sale of 69,660 shares
of its common stock, par value $5.00 per share (the "Bank Common Stock") through
a private  placement to certain  directors,  executive  officers  and  principal
shareholders of the Bank and a public offering, on a preemptive rights basis, to
all other  shareholders  and to members of the  general  public  resident in the
District of Columbia,  the State of Maryland and the  Commonwealth  of Virginia.
All shares were sold at a price of $15.00 per share,  resulting  in net proceeds
to the Bank of approximately $1 million.  The Bank relied upon the exemption for
bank  securities  provided by Section  3(a)(2) of the Securities Act of 1933. No
underwriter, broker or dealer was involved in those offerings.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS.

     The  information  required by this item is incorporated by reference to the
material  appearing  under the caption  "Management's  Discussion  and Analysis"
appearing at pages 26 to 36 of the Company's  Annual Report to Shareholders  for
the year ended December 31, 1997.

     New  Accounting  Pronouncement  - In June 1996,  the  Financial  Accounting
Standards  Board issued SFAS No. 125,  Accounting for Transfers and Servicing of
Financial Assets and  Extinguishment of Liabilities (SFAS No. 125). SFAS No. 125
is effective for transfers and servicing of financial assets and  extinguishment
of  liabilities  occurring  after  December  31,  1996,  and  is to  be  applied
prospectively.   Earlier  or  retroactive  application  is  not  permitted.  The
provisions of SFAS No. 125 relating to repurchase agreements, securities lending
and other similar  transactions  and pledged  collateral have been delayed until
after  December 31, 1997,  by SFAS No. 127,  Deferral of the  Effective  Date of
Certain Provisions of FASB Statement No. 125, an Amendment of FASB No. 125. SFAS
No. 125 provides  accounting and reporting standards for transfers and servicing
of financial  assets and  extinguishment  of  liabilities  based on a consistent
application of a financial  components  approach that focuses on control.  Under

                                      -10-

<PAGE>



this approach,  after a transfer of financial  assets,  an entity recognizes the
financial  and  servicing  assets  it  controls,  and  derecognizes  liabilities
extinguished.  SFAS No.125  provides  consistent  standards  for  distinguishing
transfers of  financial  assets that are sales from  transfers  that are secured
borrowings.  This standard  supersedes SFAS No. 76,  Extinguishment of Debt, and
No. 77, Reporting by Transferors of Transfers of Receivables with Recourse,  and
No. 122,  Accounting for Mortgage  Servicing Rights, and amends SFAS No. 115 and
No. 65, Accounting for Certain Mortgage Banking Activities.  The Company adopted
this  standard,  except for the  provisions  delayed by SFAS No. 127,  effective
January 1, 1997. The adoption of this standard did not have a material impact on
the Company's financial condition or results of operations.

     In June 1997, SFAS No. 130,  Reporting  Comprehensive  Income,  was issued.
SFAS No.  130  requires  comprehensive  income  to be  reported  in a  financial
statement  that is  displayed  with  the  same  prominence  as  other  financial
statements,  thereby  permitting  companies to display the  components  of other
comprehensive income below the total for net income in an income statement, in a
separate  statement that begins with net income, or in a statement of changes to
equity.  Such requirement would apply to all enterprises that provide a full set
of financial statements.  This statement is effective for fiscal years beginning
after December 15, 1997.  Reclassification  of financial  statements for earlier
periods for comparative purposes is required.

     Additionally,  during June 1997, the FASB issued SFAS No. 131,  Disclosures
About  Segments  of  an  Enterprise  and  Related  Information.   SFAS  No.  131
establishes  standards for the way that public  enterprises  report  information
about operating segments in annual financial  statements and requires that those
enterprises  report selected  financial  information about operating segments in
interim financial reports issued to shareholders.  It also establishes standards
for related disclosures about products and services, geographic areas, and major
customers.  SFAS No. 131 is effective for financial  statements  beginning after
December 15, 1997.

     The  implementation of SFAS 130 and SFAS 131 will only impact the reporting
and presentation of certain components of the Company's financial statements and
related footnote disclosures.

ITEM 7. FINANCIAL STATEMENTS.

     The  information  required by this item is incorporated by reference to the
Consolidated  Financial  Statements appearing at pages 10 to 25 of the Company's
Annual Report to Shareholders for the year ended December 31, 1997.

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.

     None.

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
        WITH SECTION 16(A) OF THE EXCHANGE ACT.

     The information  required by this Item is incorporated by reference to, the
material  appearing at pages 4 to 7 of the Company's  definitive proxy statement
for the Annual Meeting of Shareholders to be held on April 28, 1998.

ITEM 10. EXECUTIVE COMPENSATION.

     The information  required by this Item is incorporated by reference to, the
material appearing at page 6 of the Company's definitive proxy statement for the
Annual Meeting of Shareholders to be held on April 28, 1998.

                                      -11-
<PAGE>


ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     The information  required by this Item is incorporated by reference to, the
material  appearing at pages 3 to 4 of the Company's  definitive proxy statement
for the Annual Meeting of Shareholders to be held on April 28, 1998.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     The information  required by this Item is incorporated by reference to, the
material appearing at page 7 of the Company's definitive proxy statement for the
Annual Meeting of Shareholders to be held on April 28, 1998.

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K
<TABLE>
<CAPTION>

(A) EXHIBITS
<S>               <C>  
Exhibit No.       Description of Exhibits
3(a)              Certificate of Incorporation of the Company, as amended (1)
3(b)              Bylaws of the Company (2)
4                 Specimen certificate for the common stock, $1 par value, of the Company (3)
10(a)             Interim Capital Assistance Agreement between the Company and the RTC (4)
10(b)             Stock Pledge Agreement between the Company and the RTC (5)
11                Statement Regarding Computation of Per Share Income
13                The Company's Annual Report to Shareholders for the Year Ended December 31, 1997
21                Subsidiaries of the Registrant

          The sole  subsidiary of the  Registrant is Industrial  Bank,  National
          Association,  a national banking association  organized under the laws
          of the United States

27                Financial Data Schedule
99                Designation of the Series A Non-Voting Preferred Stock (6)

</TABLE>

-----------------------------


(1)  Incorporated  by reference to Exhibit 1 to the Company's  Current Report on
     Form 8-K, dated September 25, 1997.
(2)  Incorporated  by reference to Exhibit  2(b) to the  Company's  Registration
     Statement on Form 10-SB
(3)  Incorporated  by  reference  to  Exhibit  3 to the  Company's  Registration
     Statement on Form 10-SB
(4)  Incorporated  by reference to Exhibit  6(a) to the  Company's  Registration
     Statement on Form 10-SB
(5)  Incorporated  by reference to Exhibit  6(b) to the  Company's  Registration
     Statement on Form 10-SB
(6)  Incorporated  by reference to Exhibit 2 to the Company's  Current Report on
     Form 8-K, dated September 25, 1997.
(B)  REPORTS ON FORM 8-K

         None.
                                      -12-

<PAGE>



                                   SIGNATURES

     In accordance with Section 13 of the Securities Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                                   IBW FINANCIAL CORPORATION

March 27, 1998                            By:    /s/ B. Doyle Mitchell, Jr.
                                               ----------------------------
                                               B. Doyle Mitchell, Jr.
                                                      President

     In  accordance  with the Exchange Act, this report has been signed below by
the following  persons on behalf of the  registrant and in the capacities and on
the dates indicated.
<TABLE>
<CAPTION>
            SIGNATURE                              POSITION                             DATE
<S>                                  <C>                                             <C>   
 /s/ Clinton W. Chapman
--------------------------------        Chairman of the Board of Directors           March 30, 1998
     Clinton W. Chapman 


 /s/ George W. Windsor
--------------------------------     Vice Chairman of the Board of Directors         March 30, 1998
     George H. Windsor


 /s/ B. Doyle Mitchell, Jr.
--------------------------------       President, Chief Executive Officer            March 27, 1998   
     B. Doyle Mitchell, Jr.                     and Director                                        


 /s/ Massie S. Fleming
--------------------------------                    Director                         March 30, 1998
     Massie S. Fleming


 /s/ Benjamin L. King
--------------------------------              Secretary and Director                 March 30, 1998   
     Benjamin L. King


 /s/ Cynthia T. Mitchell 
--------------------------------                    Director                         March 30, 1998 
     Cynthia T. Mitchell

/s/  Marjorie H. Parker
--------------------------------                    Director                         March 30, 1998
     Marjorie H. Parker

<PAGE>
<CAPTION>


<S>                                           <C>                                    <C>   
--------------------------------                    Director                         March __, 1998
Robert L. White


 /s/ Emerson A. Williams                           
--------------------------------                    Director                         March 30, 1998
Emerson A. Williams


 /s/ Thomas A. Wilson                      
--------------------------------       Senior Vice President-Controller              March 27, 1998      
Thomas A. Wilson                           Principal Financial and                                      
                                              Accounting Officer                                         
                                                                                                                    
</TABLE>


<PAGE>

<TABLE>
<CAPTION>


                                INDEX TO EXHIBITS

<S>               <C>  
Exhibit No.       Description of Exhibits

3(a)              Certificate of Incorporation of the Company, as amended (1)

3(b)              Bylaws of the Company (2)

4                 Specimen certificate for the common stock, $1 par value, of the Company (3)

10(a)             Interim Capital Assistance Agreement between the Company and the RTC (4)

10(b)             Stock Pledge Agreement between the Company and the RTC (5)

11                Statement Regarding Computation of Per Share Income

13                The Company's Annual Report to Shareholders for the Year Ended December 31, 1997

21                Subsidiaries of the Registrant

         The sole  subsidiary of the  Registrant is  Industrial  Bank,  National
         Association, a national banking association organized under the laws of
         the United States

27                Financial Data Schedule

99                Designation of the Series A Non-Voting Preferred Stock (6)

</TABLE>


-----------------------------
(1)  Incorporated  by reference to Exhibit 1 to the Company's  Current Report on
     Form 8-K dated September 25, 1997
(2)  Incorporated  by reference to Exhibit  2(b) to the  Company's  Registration
     Statement on Form 10-SB
(3)  Incorporated  by  reference  to  Exhibit  3 to the  Company's  Registration
     Statement on Form 10-SB
(4)  Incorporated  by reference to Exhibit  6(a) to the  Company's  Registration
     Statement on Form 10-SB
(5)  Incorporated  by reference to Exhibit  6(b) to the  Company's  Registration
     Statement on Form 10-SB
(6)  Incorporated  by reference to Exhibit 2 to the Company's  Current Report on
     Form 8-K, dated September 25, 1997.