SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM l0-KSB

[X]     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
        ACT OF 1934.


                   For the fiscal year ended December 31, 2000

[ ]     TRANSITION REPORT UNDER SECTION 13 OR  15(d) OF  THE SECURITIES EXCHANGE
        Act Of 1934.

        For the transition period from                 to

                        Commission File Number 000-24907

                                IBL BANCORP, INC.
                                -----------------
                 (Name of small business issuer in its charter)

         LOUISIANA                                 72 - 1421499
         ---------                                 ------------
   (State or other jurisdiction of                (I.R.S. Employer
   incorporation or organization)                 Identification No.)

                23910 RAILROAD AVE., PLAQUEMINE, LOUISIANA 70764
                ------------------------------------------------
                    (Address of principal executive offices)

          Issuer's telephone number, including area code: (225)687-6337


          Securities registered pursuant to Section 12(b) of the Act:
                                 Not Applicable


          Securities registered pursuant to Section 12(g) of the Act:

                     Common Stock, par value $.0l per share
                     --------------------------------------
                                (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 issuer 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 Issuer's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-KSB. [X]

Issuer's revenues for the fiscal year ended December 31, 2000: $2,379,698

As of March 16, 2001, the aggregate market value of the 142,475 shares of Common
Stock of the Issuer held by non-affiliates, which excludes 68,395 shares held by
all directors,  executive officers and employee benefit plans of the Issuer, was
approximately $1.76 million.  This figure is based on the average of the bid and
asked prices of $12.38 per share of the Issuer's Common Stock on March 16, 2001.

Number of shares of Common Stock outstanding on March 16, 2001: 210,870
Transitional Small Business Disclosure Format (check one) : Yes [ ] No [X]


<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE:

         (1) Portions of the Annual  Report to  Stockholders  for the year ended
December 31, 2000 are incorporated into Part II, Items 5 through 8 and Part III,
Item 13 of this Form l0-KSB.

         (2)  Portions of the  definitive  proxy  statement  for the 2001 Annual
Meeting of Stockholders  filed on March 27, 2001 are incorporated into Part III,
Items 9 through 12 of this Form l0-KSB.

                                       2
<PAGE>
           PART I.

           Item 1. Description of Business.

           IBL  Bancorp,   Inc.  (the  "Company")  is  a  Louisiana  corporation
organized  in  June  1998  by  Iberville  Building  and  Loan  Association  (the
"Association")  for the  purpose of  becoming a unitary  holding  company of the
Association. The only significant assets of the Company are the capital stock of
the  Association,  the Company's loan to its Employee Stock  Ownership Plan (the
"ESOP"),  and the  remainder  of the net  proceeds  retained  by the  Company in
connection with the conversion of the  Association  from mutual to stock form on
September  30, 1998 (the  "Conversion").  The  business  and  management  of the
Company  primarily  consists of the business and management of the  Association.
The Company neither owns nor leases any property, but instead uses the premises,
equipment  and  furniture  of the  Association.  The Company  does not intend to
employ any  persons  other than  officers  of the  Association,  and the Company
utilizes  the support  staff of the  Association  from time to time.  Additional
employees  will be hired as  appropriate  to the extent the  Company  expands or
changes its business in the future.

           The  Association  is a  Louisiana-chartered  stock  savings  and loan
association  that was  originally  formed  in  1915.  The  Association  conducts
business from its office in  Plaquemine,  Louisiana.  At December 31, 2000,  the
Company had $32.3 million of total assets,  $28.4 million of total  liabilities,
including  $24.6  million of deposits,  and $3.8 million of total  stockholders'
equity (representing 11.8% of total assets).

           The Association is primarily engaged in attracting  deposits from the
general public and using those and other available sources of funds to originate
loans secured primarily by single-family  residences (one-to-four units) located
mainly in the parishes of Iberville  and West Baton Rouge.  To a lesser  extent,
the  Association  also  originates   consumer  loans,   construction  loans  and
commercial  real estate  loans.  At December 31, 2000,  the  Company's net loans
receivable  totaled  $20.7  million  or 65.3%  of the  Company's  total  assets.
Conventional  first mortgage,  one- to four-family  residential loans (excluding
construction  loans)  amounted to $14.0 million or 63.4% of the Company's  total
loan  portfolio at December 31, 2000. In addition,  the  Association  invests in
mortgaged-backed  securities and  certificates of deposit.  The Company had $8.3
million of mortgage-backed  securities at December 31, 2000,  representing 25.7%
of total assets.  Of the $8.3 million of  mortgage-backed  securities,  $334,000
matures  within five years of December 31, 2000.  Also at December 31, 2000, the
Company had $1.1  million or 3.4% of total  assets in  certificates  of deposits
with other  financial  institutions,  all of which will  mature  within the next
three years.

           The Association is a community-oriented  savings  institution,  which
emphasizes   retail  lending  and  deposit   products,   customer   service  and
convenience. The Association has generally sought to achieve long-term financial
strength and  stability by (1)  increasing  the amount and  stability of its net
interest  income,  (2)  managing  its  assets  and  liabilities  to  reduce  its
vulnerability  to changes in interest rates,  and (3) maintaining a low level of
non-performing assets. Highlights of the Association's business strategy include
the following.


                                       3
<PAGE>

           Capital Position.  As of December 31, 2000, the Association had total
stockholder's  equity of $3.2 million and exceeded all of its regulatory capital
requirements,  with tangible, core and risk-based capital ratios of 10.1%, 10.0%
and 21.2%,  respectively,  as compared to the minimum requirements of 1.5%, 4.0%
and 8.0%, respectively.

           Profitability.  The Company has been  profitable  in each of the last
three years. At December 31, 2000, net income was $297,000  compared to $184,000
and $195,000 in 1999 and 1998, respectively.

           Asset Quality. The Company's total non-performing assets were 1.2% of
total assets at December  31, 2000  compared to 0.4% and 1.0% of total assets at
December 31, 1999 and 1998, respectively. Non-accruing single-family residential
loans and consumer loans represented 100% of the total non-performing  assets at
December 31, 2000, 1999 and 1998. At December 31, 2000, the Company's  allowance
for loan losses amounted to $396,000 or 1.9% of the total loan portfolio.

           Interest Rate Risk. The primary elements of the Company's strategy to
manage its  interest  rate risk  include  (1)  emphasizing  the  origination  of
adjustable-rate    mortgages    ("ARMs"),    (2)   purchasing    adjustable-rate
mortgage-backed   securities,   (3)  since  mid-1996,   originating   fixed-rate
single-family  residential  loans to meet customer  demand,  and (4) maintaining
lower-costing  passbook and  negotiable  order of withdrawal  ("NOW")  accounts.
Based  upon  certain  repricing  assumptions,   the  Company's  interest-bearing
liabilities  repricing or maturing within one year exceeded its interest-earning
assets with similar  characteristics  by $1.3 million or 4.0% of total assets at
December 31, 2000.

           Community  Orientation.  The  Company is  committed  to  meeting  the
financial needs of the communities in which it operates. Management believes the
Association  is large  enough to  provide  a full  range of  personal  financial
services,  yet small enough to be able to provide services on a personalized and
efficient  basis.  At December 31,  2000,  most of the  Company's  loans were to
residents of its primary market area of Iberville and West Baton Rouge parishes.
The  Company  intends to continue  its  practice  of  investing  in loans in its
primary market area in accordance with its  underwriting  standards,  subject to
economic conditions and the availability of reasonable investment alternatives.

           The   Association  is  subject  to  examination   and   comprehensive
regulation by the Louisiana Office of Financial  Institutions ("OFI"),  which is
the Association's  chartering authority, and by the Office of Thrift Supervision
("OTS"),  which is the Association's primary federal regulator.  The Association
is also regulated by the Federal Deposit  Insurance  Corporation  ("FDIC"),  the
administrator of the Savings Association Insurance Fund ("SAIF"),  which insures
deposits  in  the  Association  to the  maximum  extent  provided  by  law.  The
Association is also subject to certain reserve  requirements  established by the
Board of Governors of the Federal  Reserve System ("FRB") and is a member of the
Federal Home Loan Bank ("FHLB") of Dallas, which is one of the 12 regional banks
comprising the FHLB System.

                                       4
<PAGE>

           The executive  office for the Company and the  Association is located
at 23910 Railroad Ave., Plaquemine,  LA 70764, and its telephone number is (225)
687-6337.

           Market Area

           The  Company's  primary  market area  consists of Iberville  and West
Baton Rouge  parishes in Louisiana.  These  parishes  maintain a large  commuter
population  with residents  commuting to jobs in Baton Rouge.  The population of
Iberville  Parish  was  approximately  the  same in 2000 as in 1990,  while  the
population  of West Baton Rouge Parish  increased by  approximately  6.3% during
this period.  The unemployment  rate for Iberville and West Baton Rouge Parishes
was 8.5% and 5.7%,  respectively,  in 2000,  compared to 5.4% for  Louisiana and
4.0% for the United States. In addition, the per capita income for Iberville and
West  Baton  Rouge  Parishes  in 1994 was  $16,000  and  $17,300,  respectively,
compared to $18,100 for Louisiana and $22,000 for the United States.

           Major  employers in the two parishes are Dow USA,  Iberville and West
Baton Rouge School Systems,  Novartis and Georgia Gulf. In addition, The Port of
Greater Baton Rouge,  located in West Baton Rouge Parish,  is a major port which
provides  export and import  shipping.  There is also a large  concentration  of
petro-chemical  complexes and refineries  that utilize the port's  facilities as
well as the Mississippi River for transportation of their products.  Due to this
large concentration of petro-chemical complexes and refineries,  any downturn in
these industries could have a significant  impact on the Company's  consolidated
financial statements and results of operations.

           Lending Activities

           Loan Portfolio  Composition.  At December 31, 2000, the Company's net
loan portfolio totaled $20.7 million,  representing  approximately  64.1% of the
Company's  $32.3 million of total assets at that date. All of the loans included
in the loan  portfolio  at  December  31,  2000  were  loans  originated  by the
Association.   The  principal   lending  activity  of  the  Association  is  the
origination of single-family  residential  loans,  consumer loans,  construction
loans and to a lesser  extent  commercial  real estate loans and land loans.  At
December 31, 2000,  single-family  residential  and consumer  loans  amounted to
63.4% and 22.1%,  respectively,  of the Company's  total loan  portfolio,  while
construction  loans and commercial real estate loans  represented 6.7% and 6.3%,
respectively, of the total loan portfolio, in each case before net items.



                                       5
<PAGE>


           Loan  Portfolio  Composition.  The  following  table  sets  forth the
composition  of the  Company's  loan  portfolio  by type  of  loan at the  dates
indicated.

<TABLE>
<CAPTION>
IBL Bancorp, Inc.
Loan Portfolio Composition
                                                                                December 31,
                                                  ------------------------------------------------------------------------------
                                                         2000                      1999                            1998
                                                  --------------------      ----------------------       -----------------------
                                                  Amount       Percent      Amount         Percent       Amount          Percent
                                                  ------       -------      ------         -------       ------          -------
                                                                            (Dollars in Thousands)
<S>                                               <C>           <C>        <C>              <C>          <C>              <C>
Real estate loans
        Single-family residential                 $13,964       63.36%     $12,387          64.10%       $12,488          67.47%
        Construction                                1,473        6.68%         776           4.02%           692           3.74%
        Commercial real estate                      1,381        6.27%       1,309           6.78%           896           4.84%
        Land                                          345        1.57%         401           2.08%           238           1.29%
                                                  -------       -----      -------          -----        -------          -----
                  Total real estate loans          17,163       77.88%      14,873          76.98%        14,314          77.34%
Consumer loans
        Home equity and improvement                   980        4.45%         956           4.95%         1,005           5.43%
        Loans secured by savings accounts             547        2.48%         555           2.87%           617           3.33%
        Automobile                                  1,640        7.44%       1,466           7.59%         1,251           6.76%
        Unsecured                                   1,492        6.77%       1,339           6.93%         1,228           6.63%
        Other                                         217        0.98%         131           0.68%            94           0.51%
                                                  -------       -----      -------          -----        -------          -----
                  Total consumer loans              4,876       22.12%       4,447          23.02%         4,195          22.66%
                                                  -------       -----      -------          -----        -------          -----
                  Total loans                      22,039      100.00%      19,320         100.00%        18,509         100.00%
Less:                                                          ======                      ======                        ======
        Unearned discount                             290                      244                           229
        Loans in process                              671                      517                           650
        Deferred fees                                  12                       10                             9
        Allowance for loan losses                     396                      406                           412
                                                  -------                  -------                       -------
                  Total loans receivable, net     $20,670                  $18,143                       $17,209
                                                  =======                  =======                       =======

</TABLE>
                                       6
<PAGE>

           Contractual Terms to Final Maturities. The following table sets forth
certain information as of December 31, 2000 regarding the dollar amount of loans
maturing in the Company's portfolio, based on the contractual date of the loan's
final maturity, before giving effect to net items. Demand loans and loans having
no stated  schedule of repayments and no stated  maturity are reported as due in
one year or less.  The  amounts  shown  below do not  reflect  normal  principal
amortization;  rather, the balance of each loan outstanding at December 31, 2000
is shown in the appropriate year of the loan's final maturity.


<TABLE>
<CAPTION>
BL Bancorp, Inc.
Loan Contractual Terms to Final Maturities


                                            Single-                      Commercial
                                            family                          real
                                          residential   Construction       estate       Land     Consumer       Total
                                          -----------   ------------       ------       ----     --------       -----
                                                              (Dollars in Thousands)
<S>                                         <C>             <C>            <C>         <C>         <C>         <C>
Amounts due after December 31, 2000 in:
  One year or less                          $   116         $ 1,473        $   466     $    --     $ 1,293     $ 3,348
  After one through two years                    83              --             34           5         565         687
  After two through three years                 367              --             --          28         768       1,163
  After three through five years                340              --             --          33       1,639       2,012
  After five through ten years                2,969              --             95         213         468       3,745
  After ten through fifteen years             3,017              --            333          66         143       3,559
  After fifteen years                         7,072              --            453          --          --       7,525
                                            -------         -------        -------     -------     -------     -------
        Total loans (1)                     $13,964         $ 1,473        $ 1,381     $   345     $ 4,876     $22,039
                                            =======         =======        =======     =======     =======     =======

</TABLE>

 (1) Gross of unearned  discount,  loans in process,  deferred loan  origination
fees and the allowance for loan losses.


           The following table sets forth the dollar amount of all loans, before
net items,  due after one year from  December 31, 2000 as shown in the preceding
table,  which have fixed  interest  rates or which have  floating or  adjustable
interest rates.

<TABLE>
<CAPTION>

IBL Bancorp, Inc.
Fixed and Variable Rate Loans


                                                Due  After One Year From
                                                    December 31, 2000
                                                    -----------------
                                                        Floating or
                                              Fixed      Adjustable
                                              Rates         Rates         Total
                                              -----         -----         -----
                                                   (Dollars in Thousands)
<S>                                          <C>           <C>           <C>
Single-family residential loans              $ 3,177       $10,671       $13,848
Commercial real estate loans                      --           915           915
Land loans                                       259            86           345
Consumer loans                                 3,252           331         3,583
                                             -------       -------       -------
Total loans                                  $ 6,688       $12,003       $18,691
                                             =======       =======       =======
</TABLE>

                                       7


<PAGE>


           Scheduled contractual  maturities of loans do not necessarily reflect
the actual term of the Company's  loan  portfolio.  The average life of mortgage
loans is substantially less than their average contractual terms because of loan
prepayments.  The average life of mortgage  loans tends to increase when current
mortgage loan rates  substantially  exceed rates on existing mortgage loans and,
conversely,  decrease when rates on existing mortgage loans substantially exceed
current mortgage loan rates.

           Origination of Loans.  The lending  activities of the Association are
subject to the written,  non-discriminatory,  underwriting standards and lending
policies  established by the  Association's  Board of Directors and  management.
Loan originations are obtained through a variety of sources, including referrals
from real  estate  brokers,  builders  and  existing  customers,  newspaper  and
billboard  advertising,  and walk-in  customers.  Loan applications are taken by
lending personnel,  and the loan department supervises the procurement of credit
reports,  appraisals  and other  documentation  involved  with a loan.  Property
valuations are generally performed by independent outside appraisers approved by
the Association's Board of Directors.  The Association  generally requires title
insurance (or an attorney's  opinion of title) and hazard  insurance on property
securing  first  mortgage  loans.  Title  insurance is not required for consumer
loans.

           The  Association's  loan  approval  process is intended to assess the
borrower's ability to repay the loan, the viability of the loan and the adequacy
of the value of the  property  that will  secure  the  loan.  The  Association's
lending  policies  allow its President or loan officer  authority to approve all
types of loans not exceeding  $30,000.  Loan amounts over $30,000 up to $150,000
may be approved by the  Association's  President  or loan  officer and two other
members of the board of directors.  Loans in excess of $150,000 must be approved
by the  Association's  entire board of directors,  excluding  the  Association's
attorney  who  abstains  from  voting  on loans  due to his  involvement  in the
majority of the Association's real estate loan closings.

           Generally,  the Association originates substantially all of the loans
in its portfolio and holds them until maturity.









                                       8
<PAGE>
           The following  table shows total loans  originated  and repaid during
the periods indicated. No loans were purchased or sold during the periods shown.


<TABLE>
<CAPTION>
IBL Bancorp, Inc.
Origination of Loans
                                                                December 31,
                                                                ------------
                                                       2000         1999         1998
                                                     -------      -------      -------
                                                         (Dollars in Thousands)
<S>                                                  <C>          <C>          <C>
Loan originations
          Single-family residential
            Loans for portfolio                      $ 3,794      $ 2,696      $ 2,484
          Construction                                 1,493          776          692
          Commercial real estate                         122           52          507
          Land                                            84          269           93
          Consumer                                     2,222        2,421        1,989
                                                     -------      -------      -------
              Total loans originated                   7,715        6,214        5,765
                                                     -------      -------      -------
Reductions
          Loan principal reductions                   (5,394)      (5,170)      (4,421)
Increase (decrease) due to other items - net (1)         206         (110)        (453)
                                                     -------      -------      -------
Net increase in loan portfolio                       $ 2,527      $   934      $   891
                                                     =======      =======      =======
</TABLE>
(1)  Other items, net include the effects relating to unearned  discount,  loans
     in process,  deferred  loan  origination  fees and the  allowance  for loan
     losses.


           Real Estate Lending  Standards and Underwriting  Policies.  Effective
March 19, 1993, all financial  institutions  were required to adopt and maintain
comprehensive written real estate lending policies that are consistent with safe
and sound banking practices.  These lending policies must reflect  consideration
of the Interagency  Guidelines for Real Estate Lending  Policies  adopted by the
federal banking  agencies,  including the OTS, in December 1992  ("Guidelines").
The  Guidelines  set forth uniform  regulations  prescribing  standards for real
estate  lending.  Real estate lending is defined as extensions of credit secured
by liens on interests  in real estate or made for the purpose of  financing  the
construction of a building or other  improvements to real estate,  regardless of
whether a lien has been taken on the property.


                                       9
<PAGE>

           An   institution's   lending  policy  must  address  certain  lending
considerations  set forth in the  Guidelines,  including  loan-to-value  ("LTV")
limits,  loan  administration  procedures,   underwriting  standards,  portfolio
diversification   standards,   and   documentation,   approval   and   reporting
requirements. The policy must also be appropriate to the size of the institution
and the nature and scope of its operations, and must be reviewed and approved by
the institution's board of directors at least annually. The LTV ratio framework,
with the LTV ratio being the total  amount of credit to be  extended  divided by
the appraised  value or purchase price of the property at the time the credit is
originated,  must be  established  for each category of real estate loans.  If a
loan is not secured by a first lien,  the lender must  combine all senior  liens
when calculating this ratio.

           Certain  institutions  can make real estate loans that do not conform
with the  established  LTV ratio  limits up to 100% of the  institution's  total
capital.   Within  this  aggregate  limit,   total  loans  for  all  commercial,
agricultural,   multi-family  and  other   non-one-to-four   family  residential
properties  should not exceed 30% of total  capital.  An  institution  will come
under increased supervisory scrutiny as the total of such loans approaches these
levels.  Certain loans are exempt from the LTV ratios (e.g., those guaranteed by
a government  agency,  loans to facilitate the sale of real estate owned,  loans
renewed or restructured by the original  lender(s) to the same borrower(s) where
there is no advancement of funds, etc.).

           The Association is in compliance with the above standards.

           Although  Louisiana  laws  and  regulations  permit   state-chartered
savings institutions,  such as the Association,  to originate and purchase loans
secured by real estate located  throughout the United States,  the Association's
present lending is done primarily within its primary market area, which consists
of  Iberville  and West  Baton  Rouge  Parishes  in  Louisiana.  Subject  to the
Association's  loans-to-one borrower limitation, the Association is permitted to
invest without  limitation in  residential  mortgage loans and up to 400% of its
capital in loans  secured by  non-residential  or  commercial  real estate.  The
Association may also invest in secured and unsecured consumer loans in an amount
not exceeding 35% of the Association's  total assets. This 35% limitation may be
exceeded for certain types of consumer  loans,  such as home equity and property
improvement  loans  secured by  residential  real  property.  In  addition,  the
Association  may invest up to 10% of its total  assets in secured and  unsecured
loans for commercial,  corporate, business or agricultural purposes. At December
31, 2000, the Association was well within each of the above lending limits.

           A savings  institution  generally  may not make loans to one borrower
and related  entities in an amount  which  exceeds the greater of (a) 15% of its
unimpaired  capital  and  surplus,  although  loans  in an  amount  equal  to an
additional  10% of  unimpaired  capital and surplus may be made to a borrower if
the loans are fully secured by readily marketable securities,  and (b) $500,000.
At December 31,  2000,  the  Association's  limit on  loans-to-one  borrower was
$500,000  and its  five  largest  loans  or  groups  of  loans-to-one  borrower,
including related entities amounted to $433,000,  $387,000,  $338,000, $244,000,
and $237,000,  respectively, at such date. In addition to these, the Association
had a participation loan with a balance of $361,000 at December 31, 2000. All of
the  Association's  five  largest  loans or groups of loans were  performing  in


                                       10
<PAGE>
accordance  of  their  terms  at  December  31,  2000.  The  $433,000  borrowing
relationship  is  a  single-family  residential  loan.  The  $387,000  borrowing
relationship  consists  of a  commercial  real  estate  loan  in the  amount  of
$338,000,  a single-family  residential  loan in the amount of $17,000 and three
consumer loans with total balances of $32,000.

           Loans on Existing  Residential  Properties.  The primary  real estate
lending activity of the Association is the origination of loans secured by first
mortgage liens on single-family  residences. At December 31, 2000, $14.0 million
or 63.4% of the Company's total loan portfolio,  before net items,  consisted of
single-family residential loans.

           The loan-to-value  ratio,  maturity and other provisions of the loans
made by the Association  generally have reflected the policy of making less than
the maximum loan permissible  under applicable  regulations,  in accordance with
sound  lending   practices,   market   conditions  and  underwriting   standards
established  by  the  Association.   The   Association's   lending  policies  on
single-family   residential   mortgage   loans   generally   limit  the  maximum
loan-to-value  ratio to 80% of the  lesser of the  appraised  value or  purchase
price of the  property,  and generally the  single-family  residential  loans in
excess  of an  80%  loan-to-value  ratio  require  private  mortgage  insurance.
Residential  mortgage  loans are amortized on a monthly basis with principal and
interest due each month and customarily do not include "due-on-sale" clauses.

           Various legislative and regulatory changes have given the Association
the  authority  to  originate  and  purchase  mortgage  loans which  provide for
periodic  interest  rate  adjustments  subject  to  certain   limitations.   The
Association  has  been  actively   marketing  ARMs  in  order  to  decrease  the
vulnerability  of its operations to changes in interest  rates.  At December 31,
2000,  single-family  residential ARMs represented $10.7 million or 48.6% of the
total loan portfolio, before net items.

           The Association's single-family residential ARMs are fully amortizing
loans with contractual  maturities of up to 30 years.  These loans have interest
rates which are scheduled to adjust periodically in accordance with a designated
index. The Association  currently offers ARMs on which the interest rate adjusts
every year based upon the national average contract  interest rate for all major
types of lenders on the purchases of previously occupied homes, plus a specified
margin.  The margin above the index is generally .25%.  There is a 2% cap on the
rate adjustment per period and a 13% cap on the maximum interest rate during the
life of the loan. The adjustable-rate  loans in the Association's loan portfolio
are not  convertible  into  fixed-rate  loans,  are not  assumable  without  the
Association's  consent,  do not contain prepayment  penalties and do not produce
negative amortization.

           The Association  qualifies  borrowers  based on the initial  interest
rate on the ARM rather than the fully indexed  rate.  In a rising  interest rate
environment,  the interest rate on the ARM will increase on the next  adjustment
date,  resulting in an increase in the borrower's monthly payment. To the extent
the increased rate adversely  affects the borrower's  ability to repay his loan,
the  Association  is exposed to increased  credit risk. As of December 31, 2000,
the  Company's  non-accruing   residential  loans  were  $220,000.  See  "-Asset
Quality."

                                       11
<PAGE>
           The demand for  adjustable-rate  loans in the  Association's  primary
market  area has been a function  of  several  factors,  including  the level of
interest  rates  and the  difference  between  the  interest  rates  offered  by
competitors for fixed-rate loans and adjustable-rate loans. Due to the generally
lower rates of interest  prevailing in recent periods,  consumer  preference for
fixed-rate loans has increased.  In mid-1996,  the Association began offering 15
year, fixed-rate  residential loans for retention in its portfolio,  which loans
totaled $3.2 million at December 31, 2000.

           Construction Loans. At December 31, 2000, $1.5 million or 6.7% of the
Association's  total  loan  portfolio,  before  net  items,  consisted  of seven
construction  loans.  Construction loans are not being actively marketed and are
offered primarily as a service to existing customers. Of the seven construction,
loans six were for the construction of single-family dwellings in the amounts of
$600,000,  $200,000,  $180,000,  $150,000,  $100,000 and $83,000 at December 31,
2000, including amounts not yet disbursed.  The remaining  construction loan was
for the  construction  of a  restaurant  and was in the  amount of  $160,000  at
December 31, 2000, including amounts not yet disbursed. These construction loans
each bear a fixed interest rate during the construction phase and are structured
to  be  converted  to  adjustable-rate   permanent  loans  at  the  end  of  the
construction phase. The adjustable-interest rate is not determined until the end
of the  construction  phase,  and the Association  does not charge an additional
loan  origination  fee when the  construction  loan is  converted to a permanent
loan.

           Construction  lending  is  generally  considered  to involve a higher
degree of risk of loss than long-term financing on improved, owner-occupied real
estate because of the  uncertainties of construction,  including the possibility
of costs  exceeding  the  initial  estimates  and the need to obtain a tenant or
purchaser if the property will not be owner-occupied.  The Association generally
attempts to mitigate the risks  associated with  construction  lending by, among
other  things,   lending  primarily  in  its  market  area,  using  conservative
underwriting guidelines, and closely monitoring the construction process.

           Commercial  Real Estate  Loans.  The  Association's  commercial  real
estate  loan   portfolio   primarily   consists  of  loans   secured  by  retail
establishments  and two trailer parks located within the  Association's  primary
market area.  Commercial  real estate loans  amounted to $1.4 million or 6.3% of
the total loan  portfolio  at December  31, 2000.  The largest  commercial  real
estate  loan at  December  31,  2000 was a loan  secured by  several  commercial
properties,  a rental house and a personal residence and amounted to $338,000 at
such date. The average  balance of commercial  real estate loans at December 31,
2000 was approximately $106,000.

           Nonresidential  real  estate  loans may have terms up to 30 years and
generally have adjustable rates of interest. The Association uses the same index
for commercial loans as it uses for single-family residential loans, except that
the margin for commercial  loans is generally  1.25% above the index. As part of
its commitment to loan quality, the Association's senior management reviews each
nonresidential  loan prior to approval by the Board of Directors.  All loans are
based on the appraised value of the secured property, and commercial real estate
loans are generally not made in amounts in excess of 80% of the appraised  value
of  the  secured  property.  All  appraisals  are  performed  by an  independent
appraiser  designated  by the  Association  and are


                                       12
<PAGE>

reviewed by management.  In originating  nonresidential  loans,  the Association
considers  the  quality  of  the  property,  the  credit  of the  borrower,  the
historical  and  projected  cash flow of the  project,  the location of the real
estate  and the  quality  of the  property  management.  A total of  $52,000  of
commercial  real  estate  loans  were  originated  in 1999,  and  $122,000  were
originated in 2000.

           Commercial  real estate lending is generally  considered to involve a
higher  degree of risk than  single-family  residential  lending.  Such  lending
typically  involves  large loan balances  concentrated  in a single  borrower or
groups of related borrowers for rental or business properties.  In addition, the
payment experience on loans secured by income-producing  properties is typically
dependent  on the success of the  operation  of the related  project and thus is
typically  affected by adverse  conditions  in the real estate market and in the
economy.  The Association  generally  attempts to mitigate the risks  associated
with commercial real estate lending by, among other things, lending primarily in
its market area and using low LTV ratios in the underwriting process.

           Land Loans. As of December 31, 2000, the Association's land loans are
secured by vacant lots.  These loans are  generally for a maximum of seven years
and are fully  amortizing.  At December 31, 2000, the  Association's  land loans
amounted  to  $345,000  or 1.6% of the total  loan  portfolio.  Of such  amount,
$259,000 of the land loans had fixed rates while $86,000 had adjustable interest
rates.  In 1998,  the  Association  agreed to participate in a $5.5 million loan
with seven other financial  institutions to finance the development of 400 acres
of land in the  Association's  market area. The Association has a $385,000 or 7%
interest  in the  loan,  and the  funds  will be  disbursed  as the  development
progresses.   As  of  December  31,  2000,  $361,000  was  outstanding  on  this
participation  loan. The land is being developed into an 18-hole golf course and
into vacant lots for single-family  residences. As of the filing of this report,
55 lots had been sold, thirteen houses were complete and two other homes were in
various  stages of  construction.  The loan bears an interest rate of 1% below a
specified prime rate, and the loan will be repaid as the lots are sold.

           Land development and acquisition loans involve significant additional
risks when compared with loans on existing residential  properties.  These loans
typically  involve  large loan  balances  to single  borrowers,  and the payment
experience is dependent on the  successful  development of the land and the sale
of the lots.  These  risks can be  significantly  impacted  by supply and demand
conditions.  The  Association  reviewed a feasibility  study and market analyses
with respect to the above  project.  In addition,  the land was already owned by
the developer and serves as collateral for the loan.

           Consumer  Loans.  Subject to  restrictions  contained  in  applicable
federal laws and regulations,  the Association is authorized to make loans for a
wide  variety of personal or consumer  purposes.  At  December  31,  2000,  $4.9
million or 22.1% of the total loan portfolio consisted of consumer loans.

           The Association  originates consumer loans in order to provide a full
range of financial  services to its customers  and because such loans  generally
have shorter terms and higher  interest rates than  residential  mortgage loans.
The consumer loans offered by the Association  include home  improvement  loans,
loans secured by deposit


                                       13
<PAGE>


accounts in the  Association,  automobile  loans,  mobile home loans,  unsecured
loans and other miscellaneous loans.

           Home equity and  improvement  loans are originated by the Association
for generally up to 80% of the appraised value,  less the amount of any existing
prior liens on the property. The Association secures the loan with a mortgage on
the property  (generally a second  mortgage) and will originate the loan even if
another  institution holds the first mortgage.  The loans have a maximum term of
15 years. At December 31, 2000,  home equity and improvement  loans totaled $1.0
million or 4.5% of the total loan portfolio.

           The  Association  offers  loans  secured by deposit  accounts  in the
Association,  which  loans  amounted  to  $547,000  or  2.5% of the  total  loan
portfolio at December 31, 2000.  Such loans are  originated for up to 90% of the
account balance, with a hold placed on the account restricting the withdrawal of
the account balance. The interest rate on the loan is equal to the interest rate
paid on the account  plus 2%,  subject to a minimum  interest  rate of 7% on the
loan.

           The  Association  offers  automobile  loans  on  both  new  and  used
vehicles.  There is a fairly  even  split  among  loans  secured by new and used
vehicles.  The automobile  loans have fixed rates of interest and terms of up to
five years for new vehicles and four years for used vehicles.  Automobile  loans
amounted to $1.6  million or 7.4% of the total loan  portfolio  at December  31,
2000.

           The unsecured loans originated by the Association are generally for a
maximum of $5,000 and a maximum term of 36 months,  although  the  Association's
policy  permits  up to  $10,000  unsecured  loans for a term of up to 48 months.
These loans bear a fixed rate of interest and generally require monthly payments
of principal  and interest.  The amount of unsecured  loans at December 31, 2000
was $1.5 million or 6.8% of the total loan portfolio.

           Other  consumer  loans  primarily  consist  of mobile  home loans and
overdrafts  and  amounted  to $217,000  or 1.0% of the total loan  portfolio  at
December 31, 2000.

           Consumer loans generally have shorter terms and higher interest rates
than mortgage  loans but generally  involve more credit risk than mortgage loans
because of the type and nature of collateral and, in certain cases,  the absence
of collateral.  In addition,  consumer lending  collections are dependent on the
borrower's  continuing  financial  stability,  and thus are  more  likely  to be
adversely affected by job loss,  divorce,  illness and personal  bankruptcy.  In
many cases,  any repossessed  collateral for a defaulted  consumer loan will not
provide an adequate source of repayment of the outstanding  loan balance because
of improper  repair and  maintenance of the underlying  security.  The remaining
deficiency often does not warrant further substantial collection efforts against
the borrower.  The  Association  believes  that the generally  higher yields can
compensate  for the increased  credit risk  associated  with such loans and that
consumer  loans are  important  to its  efforts to  increase  rate  sensitivity,
shorten the average  maturity of its loan  portfolio and provide a full range of
services to its  customers.

                                       14
<PAGE>

           Loan  Origination  and Other Fees. In addition to interest  earned on
loans,   the  Association   receives  loan  origination  fees  or  "points"  for
originating  loans.  Loan points are a percentage of the principal amount of the
mortgage  loan  and  are  charged  to  the  borrower  in  conjunction  with  the
origination of the loan.

           In accordance  with SFAS No. 91, which deals with the  accounting for
non-refundable fees and cost associated with originating or acquiring loans, the
Association's  loan origination fees and certain related direct loan origination
costs are offset,  and the  resulting  net amount is deferred  and  amortized as
interest income over the contractual  life of the related loans as an adjustment
to the yield of such loans. At December 31, 2000, the Association had $12,000 of
loan fees which had been  deferred and are being  recognized  as income over the
contractual life of the related loans.

           Asset Quality

           Delinquent   Loans.  The  following  table  sets  forth   information
concerning  delinquent  loans at December 31, 2000,  in dollar  amounts and as a
percentage  of  the  Company's  total  loan  portfolio.  The  amounts  presented
represent the total outstanding  principal balances of the related loans, rather
than the actual payment amounts which are past due.

<TABLE>
<CAPTION>
IBL Bancorp, Inc.
Delinquent Loans
                                                                           December 31, 2000
                                      ------------------------------------------------------------------------------------------
                                        Single-family            Commercial
                                         Residential              Real Estate              Consumer                Total
                                      Amount      Percent     Amount     Percent       Amount    Percent     Amount      Percent
                                      ------      -------     ------     -------       ------    -------     ------      -------
                                                         (Dollars in Thousands)
<S>                                   <C>           <C>        <C>           <C>       <C>         <C>        <C>           <C>
Loans Delinquent for:
        30-59 days                    $  752        3.41%      $   50        0.23%     $  246      1.11%      $1,048        4.75%
        60 - 89 days                     222        1.01%          --        0.00%        141      0.64%         363        1.65%
        90 days and over                 220        1.00%          30        0.13%        143      0.65%         393        1.78%
                                      ------        ----       ------        ----      ------      ----       ------        ----
            Total delinquent loans    $1,194        5.42%      $   80        0.36%     $  530      2.40%      $1,804        8.18%
                                      ======        ====       ======        ====      ======      ====       ======        ====


</TABLE>

                                       15
<PAGE>

           Non-Performing  Assets. When a borrower fails to make a required loan
payment, the Association attempts to cause the default to be cured by contacting
the  borrower.  Late charges are generally  imposed  following the thirtieth day
after a payment is due on mortgage loans and after 15 days on consumer loans. In
most cases defaults are cured promptly. If a delinquency extends beyond 30 days,
the loan and  payment  history is  reviewed  and efforts are made to collect the
loan. While the Association  generally prefers to work with borrowers to resolve
such  problems,  when the account  becomes 90 days  delinquent  the  Association
institutes  foreclosure  or  other  collection  proceedings,  as  necessary,  to
minimize any potential loss.

           Loans are placed on  non-accrual  status  when,  in the  judgement of
management,   the  probability  of  collection  of  interest  is  deemed  to  be
insufficient  to warrant further  accrual.  When a loan is placed on non-accrual
status, previously accrued but unpaid interest is deducted from interest income.
As a matter of policy,  the  Association  discontinues  the  accrual of interest
income when the loan becomes 90 days past due. Specific reserves are established
when a consumer loan becomes 90 days past due.

           If foreclosure is effected, the property is sold at a sheriff's sale.
If the Association is the successful  bidder,  the acquired real estate property
is then included in the  Association's  "real estate owned"  account until it is
sold. The Association is permitted under applicable regulations to finance sales
of real estate owned by "loans to  facilitate"  which may involve more favorable
interest rates and terms than generally would be granted under the Association's
underwriting  guidelines.  At December 31,  2000,  the  Association  had no real
estate owned.




                                       16

<PAGE>

           The  following  table sets forth the  amounts and  categories  of the
Association's non-performing assets at the dates indicated.

<TABLE>
<CAPTION>
IBL Bancorp, Inc.
Non-performing Assets
                                                            December 31,
                                                            ------------
                                                    2000        1999       1998
                                                     ----       ----       ----
                                                       (Dollars in Thousands)
<S>                                                  <C>        <C>        <C>
Nonaccrual loans:
  Single-family residential                          $220       $ 65       $147
  Construction                                         --         --         --
  Commercial real estate                               30         --         --
  Land                                                 --         --         --
  Consumer                                            143         54         95
    Total non-accrual loans                           393        119        242
Real estate owned                                      --         --         --
                                                     ----       ----       ----
      Total non-performing assets                    $393       $119       $242
                                                     ====       ====       ====
Total non-performing loans as a percent
 of total loans                                      1.78%      0.62%      1.31%
                                                     ====       ====       ====
Total non-performing assets as a percent
 of total assets                                     1.22%      0.41%      1.01%
                                                     ====       ====       ====

</TABLE>
           The $393,000 of non-accruing  loans at December 31, 2000 consisted of
six single-family  residential  loans, of which the largest was $69,000,  and 31
consumer loans.

           If the $393,000 of  non-accruing  loans at December 31, 2000 had been
current in accordance with their terms during 2000, the gross interest income on
such loans would have been  $26,000.  A total of $16,000 of  interest  income on
these non-accruing loans was actually recorded in 2000.

           Classified  Assets.  All loans are reviewed on a regular  basis under
the  Association's   asset   classification   policy.  The  Association's  total
classified  assets at December  31,  2000  (excluding  loss assets  specifically
reserved for), amounted to $590,000, all of which was classified as substandard.
The  largest  classified  asset at  December  31,  2000  consisted  of a $69,000
adjustable-rate  single-family  dwelling.  The remaining $521,000 of substandard
assets at December 31, 2000 consisted of 15 residential  mortgage loans totaling
$402,000,  one  commercial  real estate loan of $30,000 and five consumer  loans
totaling $89,000.

           Allowance  for Loan  Losses.  At December  31,  2000,  the  Company's
allowance  for loan  losses  amounted  to  $396,000  or 1.9% of the  total  loan
portfolio.  The Association's loan portfolio consists primarily of single-family
residential loans,

                                       17
<PAGE>

consumer  loans  and,  to  a  lesser  extent,   commercial  real  estate  loans,
construction  loans and land loans.  The loan loss  allowance is  maintained  by
management  at a level  considered  adequate to cover  possible  losses that are
currently  anticipated  based on prior loan loss experience,  known and inherent
risks in the  portfolio,  adverse  situations  that may  affect  the  borrower's
ability to repay,  the estimated  value of any  underlying  collateral,  general
economic conditions, and other factors and estimates which are subject to change
over  time.  Although  management  believes  that it uses the  best  information
available to make such  determinations,  future adjustments to allowances may be
necessary,  and net income could be  significantly  affected,  if  circumstances
differ   substantially   from  the  assumptions   used  in  making  the  initial
determinations.

           The  following  table  summarizes  changes in the  allowance for loan
losses and other selected statistics for the periods presented:


<TABLE>
<CAPTION>
IBL Bancorp, Inc.
Allowance for Loan Losses
                                                   Years Ended December 31,

                                               2000         1999         1998
                                              -------      -------      -------
                                                   (Dollars in Thousands)
<S>                                           <C>          <C>          <C>
Total loans outstanding at end of period      $22,039      $19,320      $18,509
                                              =======      =======      =======

Average loans outstanding                     $19,677      $18,066      $16,611
                                              =======      =======      =======

Balance at beginning of period                $   406      $   412      $   404
Charge offs (1)                                    15           16           13
Recoveries (2)                                      1            1           --
                                              -------      -------      -------
  Net charge offs                                  14           15           13
Provision for loan losses                           4            9           21
                                              -------      -------      -------
Balance at end of period                      $   396      $   406      $   412
                                              =======      =======      =======

Allowance for loan losses as a percent of
 total loans outstanding                         1.80%        2.10%        2.23%
                                              =======      =======      =======

Ratio of net charge-offs to average
 loans outstanding                               0.07%        0.08%        0.08%
                                              =======      =======      =======

</TABLE>

  (1)  Consists solely of consumer loans.
  (2)  Includes consumer loans of $1,000 in 2000 and 1999.

                                       18
<PAGE>


           The following table presents the allocation of the allowance for loan
losses by type of loan at each of the dates indicated.
<TABLE>
<CAPTION>

IBL Bancorp, Inc.
Allowance for Loan Losses by Type
                                                                          December 31,
                                           --------------------------------------------------------------------------
                                                    2000                      1999                     1998
                                           -----------------------    ----------------------   ----------------------
                                                           Loan                      Loan                     Loan
                                                         Category                  Category                 Category
                                             Amount        as a %      Amount        as a %     Amount        as a %
                                               of         of Total       of         of Total      of         of Total
                                            Allowance      Loans      Allowance      Loans     Allowance      Loans
                                            ---------      -----      ---------      -----     ---------      -----
                                                                     (Dollars in Thousands)
<S>                                           <C>          <C>         <C>          <C>        <C>          <C>
Loan Type
        Single-family residential             $294         63.36%      $338         64.10%     $358         67.47%
        Construction                            --          6.68%        --          4.02%       --          3.74%
        Commercial real estate                  --          6.27%        --          6.78%       --          4.84%
        Land                                    --          1.57%        --          2.08%       --          1.29%
        Consumer                               102         22.12%        68         23.02%       54         22.66%
                                              ----        ------       ----        ------      ----        ------
                  Total real estate loans     $396        100.00%      $406        100.00%     $412        100.00%
                                              ====        ======       ====        ======      ====        ======
 </TABLE>

           Mortgage-Backed Securities

           Mortgage-backed  securities  represent a participation  interest in a
pool of single-family or multi-family  residential mortgages,  the principal and
interest  payments on which are passed from the  mortgage  originators,  through
intermediaries  (generally  U.S.  Government  agencies and  government-sponsored
enterprises) that pool and repackage the participation  interests in the form of
securities,  to investors such as the Company. Such U.S. Government agencies and
government-sponsored  enterprises,  which guarantee the payment of principal and
interest to  investors,  primarily  include the Fredddie Mac, the Fannie Mae and
the Ginnie Mae.

           The  Freddie  Mac,  which  is a  corporation  chartered  by the  U.S.
Government, issues participation certificates backed principally by conventional
mortgage  loans.  The Freddie Mac  guarantees the timely payment of interest and
the ultimate return of principal on participation  certificates.  The Fannie Mae
is a private  corporation  chartered  by the U.S.  Congress  with a  mandate  to
establish a secondary  market for mortgage loans.  The Fannie Mae guarantees the
timely  payment of principal and interest on Fannie Mae  securities.  The Ginnie
Mae  is  a  government  agency  within  the  Department  of  Housing  and  Urban
Development,  which is  intended  to help  finance  government-assisted  housing
programs.  Ginnie  Mae  securities  are backed by loans  insured by the  Federal
Housing  Administration  ("FHA"),  or guaranteed by the Veterans  Administration
("VA"),  and the  timely  payment  of  principal  and  interest  on  Ginnie  Mae
securities  are  guaranteed  by the  Ginnie Mae and backed by the full faith and
credit of the U.S.  Government.  Because the Freddie Mac, the Fannie Mae and the
Ginnie  Mae were  established  to  provide  support  for low- and  middle-income
housing, there are

                                       19
<PAGE>
limits to the maximum  size of the loans that  qualify for these  programs.  For
example,  the Fannie Mae and the Freddie Mac currently limit their loans secured
by  a  single-family,  owner-occupied  residence  to  $275,000.  To  accommodate
larger-sized  loans,  and loans that, for other  reasons,  do not conform to the
agency programs,  a number of private  institutions  have established  their own
home-loan origination and securitization programs.

           Of the $8.3  million of  mortgage-backed  securities  at December 31,
2000,  $2.1 million was  accounted  for as held to maturity and had an aggregate
market  value of $2.1  million  at such  date.  The  remaining  $6.2  million of
mortgage-backed  securities  at December 31, 2000 are accounted for as available
for sale and are thus  carried  at  market  value.  For  additional  information
relating to the  Company's  mortgage-backed  securities,  see Note E of Notes to
Consolidated  Financial  Statements  in the  Company's  2000  Annual  Report  to
Stockholders, which is filed as Exhibit 13.0 hereto ("2000 Annual Report").

           Mortgage-backed  securities generally yield less than the loans which
underlie  such  securities   because  of  their  payment  guarantees  or  credit
enhancements  which offer  nominal  credit risk.  In  addition,  mortgage-backed
securities  are more liquid than  individual  mortgage  loans and may be used to
collateralize  borrowings  or other  obligations  of the  Company.  In  general,
mortgage-backed  pass-through  securities  are  weighted at no more than 20% for
risk-based  capital  purposes,  compared to an assigned risk weighting of 50% to
100%  for  whole  residential  mortgage  loans.  As a  result,  these  types  of
securities allow the Company to optimize  regulatory capital to a greater extent
than  non-securitized  whole loans.  While  mortgage-backed  securities  carry a
reduced credit risk as compared to whole loans,  such securities  remain subject
to the risk that a  fluctuating  interest  rate  environment,  along  with other
factors such as the geographic  distribution  of the underlying  mortgage loans,
may alter the  prepayment  rate of such  mortgage  loans and so affect  both the
prepayment speed and value of such securities.

           The  following  table sets  forth the  composition  of the  Company's
mortgage-backed securities at each of the dates indicated.

<TABLE>
<CAPTION>
IBL Bancorp, Inc.
Mortgage-backed Securities Portfolio
                                                          December 31,
                                                  ----------------------------
                                                   2000      1999         1998
                                                  ------     ------     ------
                                                    (Dollars in Thousands)
<S>                                               <C>        <C>        <C>
Mortgage-backed securities held to maturity
  Fannie Mae                                      $1,442     $1,461     $1,402
  Freddie Mac                                        552        819        601
  Gennie Mae                                          74         92        119
                                                  ------     ------     ------

    Subtotal - held to maturity                    2,068      2,372      2,122
                                                  ------     ------     ------
Mortgage-backed securities available for sale
  Fannie Mae                                       4,175      2,147      1,348
  Freddie Mac                                        853        436         --
  Gennie Mae                                       1,206      1,149        106
                                                  ------     ------     ------
    Subtotal - available for sale                  6,234      3,732      1,454
                                                  ------     ------     ------

      Total                                       $8,302     $6,104     $3,576
                                                  ======     ======     ======


</TABLE>



                                       20

<PAGE>

           Information regarding the contractual maturities and weighted average
yield of the Company's mortgage-backed securities portfolio at December 31, 2000
is presented  below.  Due to  repayments  of the  underlying  loans,  the actual
maturities of mortgage-backed  securities  generally are substantially less than
the scheduled maturities.

           The following table sets forth the purchases and principal repayments
of the Company's mortgage-backed  securities during the periods indicated. There
were no sales during the periods shown.


<TABLE>
<CAPTION>


IBL Bancorp, Inc.
Mortgage-backed Securities Portfolio Activity
                                                             At or For The Year Ended
                                                                   December 31,
                                                                   ------------
                                                         2000          1999         1998
                                                       -------       -------       -------
                                                             (Dollars in Thousands)
Mortgage-backed securities at
<S>                                                    <C>           <C>           <C>
 beginning of period (cost)                            $ 6,111       $ 3,576       $ 4,329
Purchases                                                3,672         3,574           559
Repayments                                               1,498         1,021         1,284
Discount accretion / (premium amortization)                (12)          (18)          (28)
                                                       -------       -------       -------
Mortgage-backed securities at end of period (cost)     $ 8,273       $ 6,111       $ 3,576
                                                       =======       =======       =======
Mortgage-backed securities at end of
 period ( fair value)                                  $ 8,303       $ 6,041       $ 3,570
                                                       =======       =======       =======
Weighted average yield at end of period                   7.30%         6.12%         5.76%
                                                       =======       =======       =======

</TABLE>




                                       21
<PAGE>


           Investment Securities

           The  Association  has the  authority  to invest in  various  types of
liquid  assets,  including  United States  Treasury  obligations,  securities of
various federal agencies and of state and municipal governments, certificates of
deposit at federally-insured  banks and savings  institutions,  certain bankers'
acceptances and federal funds, and the Company has broader investing  authority.
Each purchase of an  investment  security is approved by the Board of Directors.
The Company's  investment  securities  are carried in accordance  with generally
accepted  accounting  principles  ("GAAP").  All  of  the  Company's  investment
securities were accounted for as held-to-maturity at December 31, 2000.

           Investment  securities (excluding FHLB stock) totaled $1.1 million or
3.4% of total  assets at  December  31,  2000,  consisting  of  certificates  of
deposits in other financial institutions.  At December 31, 2000, the Company had
no other investment securities.

           Sources of Funds

           General.  Deposits are the primary source of the Company's  funds for
lending and other  investment  purposes.  In addition to  deposits,  the Company
derives funds from principal and interest payments on loans and  mortgage-backed
securities.  Loan  repayments  are a relatively  stable  source of funds,  while
deposit inflows and outflows are  significantly  influenced by general  interest
rates and money market conditions.  Borrowings may be used on a short-term basis
to compensate  for reductions in the  availability  of funds from other sources.
They may also be used on a longer-term basis for general business purposes.

           Deposits.  The Association's  deposits are attracted principally from
within the  Association's  primary  market area  through the offering of a broad
selection of deposit instruments,  including NOW accounts,  money market deposit
accounts,  regular savings  accounts,  and term certificate  accounts.  Included
among these deposit products are individual  retirement account  certificates of
approximately  $2.0  million or 8.2% of total  deposits  at December  31,  2000.
Deposit  account terms vary,  with the principal  differences  being the minimum
balance  required,  the time  periods  the funds must  remain on deposit and the
interest rate.

           The large variety of deposit  accounts offered by the Association has
increased the Association's ability to retain deposits and allowed it to be more
competitive  in  obtaining  new  funds,  but has not  eliminated  the  threat of
disintermediation  (the flow of funds away from savings institutions into direct
investment vehicles such as government and corporate  securities).  In addition,
the  Association is subject to short-term  fluctuations  in deposit  flows.  The
Association's  ability to attract and maintain  deposits is affected by the rate
consciousness  of its  customers  and  their  willingness  to  move  funds  into
higher-yielding  accounts.  The  Association's  cost of funds has been, and will
continue to be, affected by money market conditions.

                                       22
<PAGE>

           The  following  table shows the  distribution  of, and certain  other
information  relating to, the Association's  deposits by type of deposit,  as of
the dates indicated.


<TABLE>
<CAPTION>
IBL Bancorp, Inc.
Deposits
                                                                    December 31,
                                   ------------------------------------------------------------------------------
                                            2000                        1999                       1998
                                   ---------------------       ----------------------      ----------------------
                                    Amount        Total         Amount          Total      Amount         Total
                                                               (Dollars in Thousands)
<S>                                <C>             <C>         <C>              <C>        <C>             <C>
Certificate accounts
--------------------
  4.00% - 5.99%                    $10,787         43.90%      $13,556          59.24%     $12,491         62.77%
  6.00% - 7.99%                      6,509         26.49%        1,410           6.16%       1,735          8.72%
                                   -------        ------       -------         ------      -------        ------
    Total certificate accounts      17,296         70.39%       14,966          65.40%      14,226         71.49%
                                   -------        ------       -------         ------      -------        ------

Transaction accounts
--------------------
  Passbook accounts                  3,134         12.76%        3,302          14.43%       3,323         16.70%
  Money market accounts                151          0.61%          177           0.77%         153          0.77%
  NOW accounts (1)                   3,908         15.92%        4,405          19.25%       2,159         10.85%
                                   -------        ------       -------         ------      -------        ------
    Total transaction accounts       7,193         29.29%        7,884          34.45%       5,635         28.32%
                                   -------        ------       -------         ------      -------        ------
    Total deposit accounts          24,489         99.68%       22,850          99.85%      19,861         99.81%
Accrued interest payable                78          0.32%           34           0.15%          38          0.19%
                                   -------        ------       -------         ------      -------        ------
      Total deposits               $24,567        100.00%      $22,884         100.00%     $19,899        100.00%
                                   =======         =====       =======          =====      =======         =====

</TABLE>
 (1)  Includes noninterest-bearing checking accounts.


                                      23

<PAGE>

           The  following  table  presents  the average  balance of each type of
deposit  and the  average  rate paid on each  type of  deposit  for the  periods
indicated.


<TABLE>
<CAPTION>
IBL Bancorp, Inc.
Deposits - Average Balances and Rates
                                                                    Year Ended December 31,
                                           -----------------------------------------------------------------------
                                                    2000                      1999                     1998
                                           -------------------       -------------------      --------------------
                                           Average        Rate       Average        Rate      Average         Rate
                                           Balance        Paid       Balance        Paid      Balance         Paid
                                           -------        ----       -------        ----      -------         ----
                                                                     (Dollars in Thousands)
<S>                                        <C>            <C>        <C>            <C>         <C>            <C>
Passbook savings accounts                  $ 3,667        2.57%      $ 3,396        3.14%       $ 3,434        3.03%
Demand and NOW accounts (1)                  4,043        2.97%        3,398        2.37%         2,312        3.27%
Money market deposit accounts                  175        6.45%          164        6.66%           216        5.68%
Certificates of deposit                     15,916        4.89%       15,465        4.56%        14,594        4.84%
                                           -------        ----       -------        ----        -------        ----
   Total interest-bearing deposits (2)     $23,801        4.21%      $22,423        4.03%       $20,556        4.37
                                           =======        ====       =======        ====        =======        ====
</TABLE>

     (1)     Includes noninterest-bearing checking accounts.
     (2)     Excludes accrued interest payable.



           The following  table sets forth the savings flows of the  Association
during the periods indicated.


<TABLE>
<CAPTION>
IBL Bancorp, Inc.
Deposit Activity
                                                             Years Ended December 31,
                                                        -------------------------------
                                                          2000        1999        1998
                                                        -------     -------     -------
                                                              (Dollars in Thousands)
<S>                                                     <C>         <C>         <C>
Net increase (decrease) before interst credited (1)     $   636     $ 2,086     $(1,030)
Interest credited                                         1,003         904         898
                                                        -------     -------     -------
  Net increase (decrease) in deposits (2)               $ 1,639     $ 2,990     $  (132)
                                                        =======     =======     =======
</TABLE>

(1)  The information provided is the net of deposits and withdrawals because the
     gross amount of deposits and withdrawals is not readily available.
(2)  Excludes accrued interest payable on deposits.



                                       24
<PAGE>

           The  Association  attempts to control the flow of deposits by pricing
its accounts to remain generally  competitive with other financial  institutions
in its market area,  but does not  necessarily  seek to match the highest  rates
paid by  competing  institutions.  The  Association  has  generally  not taken a
position  of price  leadership  in its  markets,  except  when there has been an
opportunity to market longer-term deposits.

           The principal  methods used by the  Association  to attract  deposits
include the  offering of a wide variety of services  and  accounts,  competitive
interest  rates and a  convenient  office  location.  The  Association  does not
advertise for deposits outside of its market area.

           The following table presents,  by various  interest rate  categories,
the amount of certificates of deposit at December 31, 2000,  which mature during
the periods indicated.

<TABLE>
<CAPTION>

IBL Bancorp, Inc.
CD Maturity Breakdown

Certificates of Deposit
-----------------------
As of December 31, 2000
-----------------------

                                              Maturity Date
                         -----------------------------------------------------------------
                         One Year      Over One to    Over Two to    Over Three
                          or Less      Two Years      Three Years       Years      Total
                          -------      ---------      -----------       -----      -----
                                       (Dollars in Thousands)
<C>                      <C>            <C>            <C>             <C>         <C>
4.00% - 5.99%            $ 7,591        $ 1,489        $   938         $   769     $10,787
6.00% - 7.99%              5,007            805            239             458       6,509
                         -------        -------        -------         -------     -------
  Total                  $12,598        $ 2,294        $ 1,177         $ 1,227     $17,296
                         =======        =======        =======         =======     =======



<CAPTION>

Certificates of Deposit - $100,000 or more
------------------------------------------
                                                                      Dollars in
                                                                      Thousands
                                                                      ---------
<S>                                                                    <C>

Maturing in quarter ending:
  March 31, 2001                                                       $ 1,483
  June 30, 2001                                                            404
  September 30, 2001                                                       400
  December 31, 2001                                                      1,044
  After December 31, 2001                                                  553
                                                                        -------
    Total certificates of
      deposit - $100,000 or more                                        $ 3,884
                                                                        =======

</TABLE>
                                       25
<PAGE>
           Borrowings.  The  Association  may obtain  advances  from the FHLB of
Dallas upon the security of the common stock it owns in that bank and certain of
its  residential  mortgage  loans,  investment  securities  and  mortgage-backed
securities,  provided certain  standards  related to credit worthiness have been
met. See  "Regulation  -The  Association  - Federal Home Loan Bank System." Such
advances are made pursuant to several credit programs, each of which has its own
interest rate and range of maturities.  Such advances are generally available to
meet seasonal and other  withdrawals of deposit accounts and to permit increased
lending.

           As of December 31, 2000, the  Association  was permitted to borrow up
to an aggregate of $13.6 million from the FHLB of Dallas.  The  Association  had
$3.7 million of FHLB  advances  outstanding  at December  31, 2000.  Pursuant to
collateral  agreements with the FHLB, the December 31, 2000 advances are secured
by a blanket floating lien on first mortgage loans.

           The  following  table  sets  forth  certain   information   regarding
borrowings at the dates or for the periods indicated.

<TABLE>
<CAPTION>

IBL Bancorp, Inc.
Borrowings
                                                        At or for the Year Ended
                                                               December 31,
                                                               ------------
                                                       2000        1999         1998
                                                      ------      ------      ------
<S>                                                   <C>         <C>         <C>
FHLB advances:
  Average balance outstanding                         $2,834      $1,067      $  293
  Maximum amount outstanding at any
   month-end during the period                        $3,697      $2,300      $  610
  Balance outstanding at end of period                $3,697      $2,300      $  495
  Average interest rate during the period               6.00%       4.59%       5.80%
  Weighted average interest rate at end of period       6.39%       5.58%       4.61%



</TABLE>

                                       26
<PAGE>

Subsidiary

           At December 31, 2000,  the  Association  had no  subsidiaries.  Under
Louisiana law, a state-chartered  association may invest up to 10% of its assets
in service organizations or corporations.

Employees

           The  Association  had nine full-time  employees at December 31, 2000.
None of these employees are represented by a collective  bargaining  agent,  and
the Association believes that it enjoys good relations with its personnel.

Competition

           The  Association  faces  significant  competition  both in attracting
deposits and in making loans. Its most direct  competition for deposits has come
historically from commercial banks, credit unions and other savings institutions
located in its primary market area, including many large financial  institutions
which have greater  financial  and  marketing  resources  available to them.  In
addition,   the  Association  faces  additional   significant   competition  for
investors'  funds from  short-term  money  market  mutual  funds and  issuers of
corporate and  government  securities.  The  Association  does not rely upon any
individual group or entity for a material  portion of its deposits.  The ability
of the  Association  to attract  and retain  deposits  depends on its ability to
generally  provide  a rate of  return,  liquidity  and risk  comparable  to that
offered by competing investment opportunities.

           The Association's competition for real estate loans comes principally
from mortgage banking companies,  commercial banks,  other savings  institutions
and credit unions.  The  Association  competes for loan  originations  primarily
through the  interest  rates and loan fees it charges,  and the  efficiency  and
quality of services it provides  borrowers.  Factors  which  affect  competition
include general and local economic conditions,  current interest rate levels and
volatility in the mortgage markets.





                                       27
<PAGE>
                                   REGULATION

           The following  discussion of certain laws and  regulations  which are
applicable to the Company and the  Association,  as well as descriptions of laws
and regulations contained elsewhere herein,  summarizes the aspects of such laws
and  regulations  which  are  deemed  to be  material  to the  Company  and  the
Association.  However,  the  summary  does not  purport  to be  complete  and is
qualified in its entirety by reference to applicable laws and regulations.

           The Company

           General.  The  Company,  as a  registered  savings  and loan  holding
company within the meaning of the Home Owners' Loan Act, as amended ("HOLA"), is
subject   to  OTS   regulations,   examinations,   supervision   and   reporting
requirements.  As a  subsidiary  of a  savings  and loan  holding  company,  the
Association is subject to certain  restrictions in its dealings with the Company
and affiliates thereof.

           Activities  Restrictions.  There are generally no restrictions on the
activities of a savings and loan holding company which holds only one subsidiary
savings  institution.  However, if the Director of the OTS determines that there
is  reasonable  cause to believe  that the  continuation  by a savings  and loan
holding  company of an  activity  constitutes  a serious  risk to the  financial
safety,  soundness or  stability  of its  subsidiary  savings  institution,  the
Director may impose such  restrictions as deemed necessary to address such risk,
including  limiting  (1) payment of dividends  by the savings  institution;  (2)
transactions  between the savings  institution and its  affiliates;  and (3) any
activities of the savings  institution that might create a serious risk that the
liabilities  of the  holding  company and its  affiliates  may be imposed on the
savings institution.  Notwithstanding the above rules as to permissible business
activities  of  unitary  savings  and loan  holding  companies,  if the  savings
institution  subsidiary of such a holding company fails to meet the QTL test, as
discussed  under "-The  Association  - Qualified  Thrift Lender Test," then such
unitary holding company also shall become subject to the activities restrictions
applicable  to  multiple  savings and loan  holding  companies  and,  unless the
savings  institution  requalifies  as a QTL  within one year  thereafter,  shall
register  as,  and  become  subject to the  restrictions  applicable  to, a bank
holding company. See "-The Association - Qualified Thrift Lender Test."

           If  the  Company   were  to  acquire   control  of  another   savings
institution,  other than through merger or other business  combination  with the
Association,  the Company  would  thereupon  become a multiple  savings and loan
holding  company.  Except where such acquisition is pursuant to the authority to
approve  emergency  thrift   acquisitions  and  where  each  subsidiary  savings
institution  meets  the QTL test,  as set forth  below,  the  activities  of the
Company  and any of its  subsidiaries  (other  than  the  Association  or  other
subsidiary  savings   institutions)  would  thereafter  be  subject  to  further
restrictions.  Among other things,  no multiple savings and loan holding company
or  subsidiary  thereof  which is not a savings  institution  shall  commence or
continue for a limited period of time after becoming a multiple savings and loan
holding company or subsidiary thereof any business  activity,  except upon prior
notice to and no objection by the OTS,  other than: (1) furnishing or performing
management  services for a subsidiary  savings  institution;  (2)  conducting an
insurance  agency or escrow  business;  (3) holding,  managing,  or  liquidating
assets owned by or acquired from a subsidiary


                                       28
<PAGE>
savings  institution;  (4) holding or managing  properties used or occupied by a
subsidiary savings institution;  (5) acting as trustee under deeds of trust; (6)
those  activities  authorized by regulation as of March 5, 1987 to be engaged in
by multiple  savings and loan holding  companies;  or (7) unless the Director of
the OTS by regulation  prohibits or limits such  activities for savings and loan
holding  companies,  those  activities  authorized by the FRB as permissible for
bank holding  companies.  Those  activities  described in (7) above also must be
approved  by the  Director  of the OTS prior to being  engaged  in by a multiple
savings and loan holding company.

           Limitations on Transactions  with  Affiliates.  Transactions  between
savings  institutions  and any affiliate are governed by Sections 23A and 23B of
the Federal Reserve Act and OTS regulations. Affiliates of a savings institution
include any  company or entity  which  controls,  is  controlled  by or is under
common control with the savings  institution.  In a holding company context, the
parent holding  company of a savings  institution  (such as the Company) and any
companies  which are controlled by such parent holding company are affiliates of
the savings  institution.  Generally,  such  provisions  (1) limit the extent to
which the  savings  institution  or its  subsidiaries  may  engage  in  "covered
transactions"  with  any  one  affiliate  to an  amount  equal  to 10%  of  such
institution's  capital stock and surplus,  and contain an aggregate limit on all
such  transactions with all affiliates to an amount equal to 20% of such capital
stock  and  surplus  and (2)  require  that  all such  transactions  be on terms
substantially  the  same,  or at  least  as  favorable,  to the  institution  or
subsidiary as those provided to a non-affiliate.  The term "covered transaction"
includes the making of loans,  purchase of assets,  issuance of a guarantee  and
other  similar  transactions.  In addition to the  restrictions  imposed by such
provisions, no savings institution may (1) loan or otherwise extend credit to an
affiliate,  unless the affiliate is engaged only in activities  permissible  for
bank  holding  companies,  or (2)  purchase  or  invest  in any  stocks,  bonds,
debentures, notes or similar obligations of any affiliate, except for affiliates
which are subsidiaries of the saving institution.

           In addition,  Sections 22(h) and (g) of the Federal Reserve Act place
restrictions   on  loans  to  executive   officers,   directors   and  principal
stockholders. Under Section 22(h), loans to a director, an executive officer and
to a  greater  than  10%  stockholder  of a  savings  institution,  and  certain
affiliated  interests  of  either,  may not  exceed,  together  with  all  other
outstanding  loans  to  such  person  and  affiliated  interests,   the  savings
institution's  loans  to  one  borrower  limit  (generally  equal  to 15% of the
institution's unimpaired capital and surplus).  Section 22(h) also requires that
loans to directors,  executive  officers and principal  stockholders  be made on
terms  substantially  the same as offered in  comparable  transactions  to other
persons  (except  for  preferential  terms  offered to all  employees)  and also
requires  prior board  approval for certain  loans.  In addition,  the aggregate
amount of extensions of credit by a savings  institution to all insiders  cannot
exceed the institution's  unimpaired capital and surplus.  Furthermore,  Section
22(g) places additional restrictions on loans to executive officers. At December
31, 2000, the Association was in compliance with the above restrictions.


           Restrictions  on  Acquisitions.  Except under limited  circumstances,
savings and loan holding companies are prohibited from acquiring,  without prior
approval  of  the  Director  of the  OTS,  (1)  control  of  any  other  savings
institution or savings and loan

                                       29
<PAGE>

holding company or  substantially  all the assets thereof or (2) more than 5% of
the voting shares of a savings  institution or holding  company thereof which is
not a subsidiary.  Except with the prior approval of the Director of the OTS, no
director or officer of a savings and loan  holding  company or person  owning or
controlling  by proxy or otherwise more than 25% of such  company's  stock,  may
acquire  control of any savings  institution,  other than a  subsidiary  savings
institution, or of any other savings and loan holding company.

           The  Director of the OTS may only approve  acquisitions  resulting in
the  formation of a multiple  savings and loan holding  company  which  controls
savings institutions in more than one state if (1) the multiple savings and loan
holding company involved controls a savings institution which operated a home or
branch office located in the state of the institution to be acquired as of March
5, 1987;  (2) the  acquirer  is  authorized  to acquire  control of the  savings
institution  pursuant to the  emergency  acquisition  provisions  of the Federal
Deposit  Insurance Act  ("FDIA");  or (3) the statutes of the state in which the
institution to be acquired is located  specifically  permit  institutions  to be
acquired  by the  state-chartered  institutions  or  savings  and  loan  holding
companies  located in the state where the  acquiring  entity is located (or by a
holding company that controls such state-chartered savings institutions).

           Under the Bank Holding  Company Act of 1956, the FRB is authorized to
approve an application by a bank holding company to acquire control of a savings
institution.  In  addition,  a bank  holding  company  that  controls  a savings
institution  may merge or consolidate  the assets and liabilities of the savings
institution  with, or transfer  assets and  liabilities  to, any subsidiary bank
which is a member of the Bank  Insurance  Fund  ("BIF") with the approval of the
appropriate federal banking agency and the FRB. As a result of these provisions,
there have been a number of acquisitions of savings institutions by bank holding
companies in recent years.

           The Association

           General. The OFI is the Association's  chartering authority,  and the
OTS is the  Association's  primary federal  regulator.  The OTS and the OFI have
extensive   authority  over  the  operations  of   Louisiana-chartered   savings
institutions.  As part of this authority,  savings  institutions are required to
file  periodic  reports  with the OTS and the OFI and are  subject  to  periodic
examinations  by the OTS,  the OFI and the  FDIC.  The  investment  and  lending
authority  of  savings   institutions   are   prescribed  by  federal  laws  and
regulations,   and  such  institutions  are  prohibited  from  engaging  in  any
activities  not  permitted by such laws and  regulations.  Such  regulation  and
supervision is primarily intended for the protection of depositors.

           The OTS'  enforcement  authority  over all savings  institutions  and
their holding  companies  includes,  among other  things,  the ability to assess
civil  money  penalties,  to issue  cease and  desist or  removal  orders and to
initiate  injunctive  actions.  In  general,  these  enforcement  actions may be
initiated  for  violations  of laws  and  regulations  and  unsafe  and  unsound
practices.  Other  actions or  inactions  may provide the basis for  enforcement
actions, including misleading or untimely reports filed with the OTS.


                                       30
<PAGE>


           Insurance of Accounts. The deposits of the Association are insured to
the maximum extent permitted by the SAIF, which is administered by the FDIC, and
are backed by the full faith and credit of the U.S. Government.  As insurer, the
FDIC is  authorized  to conduct  examinations  of, and to require  reporting by,
FDIC-insured  institutions.  It also may prohibit any  FDIC-insured  institution
from engaging in any activity the FDIC determines by regulation or order to pose
a serious  threat  to the FDIC.  The FDIC  also has the  authority  to  initiate
enforcement  actions  against  savings  institutions,  after  giving  the OTS an
opportunity to take such action.

           Under current FDIC  regulations,  institutions are assigned to one of
three  capital  groups which are based  solely on the level of an  institution's
capital--"well      capitalized",       "adequately      capitalized",       and
"undercapitalized"--which  are  defined  in the same  manner as the  regulations
establishing the prompt  corrective  action system 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 ranging
prior to September 30, 1996 from .23% for well capitalized, healthy institutions
to .31% for undercapitalized institutions with substantial supervisory concerns.

           The deposits of the  Association  are currently  insured by the SAIF.
Both the SAIF and the BlF,  the  federal  deposit  insurance  fund  that  covers
commercial  bank  deposits,  are required by law to maintain a reserve  ratio of
1.25% of insured  deposits.  The BIF achieved a fully funded status  first,  and
effective  January 1, 1996 the FDIC  substantially  reduced the average  deposit
insurance premium paid by commercial  banks. The deposit insurance  premiums for
BlF member  institutions  were reduced to zero basis points (subject to a $2,000
minimum) for  institutions in the lowest risk category,  as compared to 23 basis
points for SAIF members in the lowest risk category.

           On  September  30,  1996,  new  legislation  eliminated  the  premium
differential between SAIF-insured  institutions and BIF-insured  institutions by
recapitalizing  the SAIF's  reserves  to the  required  ratio.  The  legislation
required all SAIF member  institutions to pay a one-time  special  assessment to
recapitalize  the SAIF, with the aggregate  amount to be sufficient to bring the
reserve ratio in the SAIF to 1.25% of insured  deposits.  The  legislation  also
provided  for the  merger  of the  BIF and the  SAIF,  with  such  merger  being
conditioned upon the prior elimination of the thrift charter.

           Beginning January 1, 1997,  effective SAIF rates generally range from
zero basis points to 27 basis points.  From 1997 through 1999, SAIF members paid
6.4  basis  points  to  fund  the  FICO,  while  BIF  member  institutions  paid
approximately 1.3 basis points. The Association's insurance premiums,  which had
amounted to 23 basis  points,  were thus reduced to 6.4 basis  points  effective
January  1,  1997.  Effective  January  1  2000,  the  Association's   effective
assessment rate dropped to 2.0 basis points.  The Association paid approximately
$5,000 in insurance premiums in 2000.

           The  FDIC  may  terminate  the  deposit   insurance  of  any  insured
depository  institution,  including the  Association,  if it determines  after a
hearing  that the  institution  has  engaged or is engaging in unsafe or unsound
practices, is in an unsafe or unsound

                                       31
<PAGE>

condition  to  continue   operations,   or  has  violated  any  applicable  law,
regulation,  order or any  condition  imposed by an agreement  with the FDIC. It
also may suspend deposit  insurance  temporarily  during the hearing process for
the permanent  termination  of  insurance,  if the  institution  has no tangible
capital. If insurance of accounts is terminated, the accounts at the institution
at the time of the termination,  less subsequent withdrawals,  shall continue to
be insured for a period of six months to two years,  as  determined by the FDIC.
Management  is  aware  of  no  existing  circumstances  which  would  result  in
termination of the Association's deposit insurance.

           Regulatory   Capital   Requirements.    Federally   insured   savings
institutions are required to maintain minimum levels of regulatory capital.  The
OTS has established  capital standards  applicable to all savings  institutions.
These  standards  generally  must  be as  stringent  as the  comparable  capital
requirements  imposed on national  banks.  The OTS also is  authorized to impose
capital requirements in excess of these standards on individual  institutions on
a case-by-case basis.

           Current OTS capital standards require savings institutions to satisfy
three  different   capital   requirements.   Under  these   standards,   savings
institutions must maintain "tangible" capital equal to at least 1.5% of adjusted
total assets, "core" capital equal to at least 4.0% of adjusted total assets and
"total" capital (a combination of core and "supplementary"  capital) equal to at
least 8.0% of  "risk-weighted"  assets.  For  purposes of the  regulation,  core
capital generally consists of common  stockholders'  equity (including  retained
earnings).  Tangible capital is given the same definition as core capital but is
reduced by the amount of all the savings  institution's  intangible assets, with
only a limited  exception for purchased  mortgage  servicing rights. At December
31,  2000,  the  Association  had no  intangible  assets  which are  deducted in
computing  its  tangible  capital.  Both core and  tangible  capital are further
reduced  by  an  amount  equal  to  a  savings  institution's  debt  and  equity
investments in  subsidiaries  engaged in activities not  permissible to national
banks (other than  subsidiaries  engaged in  activities  undertaken as agent for
customers  or  in  mortgage   banking   activities  and  subsidiary   depository
institutions or their holding companies).  At December 31, 2000, the Association
had no subsidiaries.

           In determining compliance with the risk-based capital requirement,  a
savings  institution  is allowed to include both core capital and  supplementary
capital in its total capital,  provided that the amount of supplementary capital
included does not exceed the savings  institution's core capital.  Supplementary
capital generally consists of general allowances for loan losses up to a maximum
of  1.25% of  risk-weighted  assets,  together  with  certain  other  items.  In
determining the required amount of risk-based capital,  total assets,  including
certain  off-balance  sheet items,  are multiplied by a risk weight based on the
risks inherent in the type of assets.  The risk weights  assigned by the OTS for
principal  categories of assets are (a) 0% for cash and securities issued by the
U.S.  Government or  unconditionally  backed by the full faith and credit of the
U.S. Government; (b) 20% for securities (other than equity securities) issued by
U.S.  Government-sponsored agencies and mortgage-backed securities issued by, or
fully  guaranteed as to principal and interest by, the Fannie Mae or the Freddie
Mac,  except  for  those  classes  with  residual  characteristics  or  stripped
mortgage-related  securities;  (c)  50%  for  prudently  underwritten  permanent
single-family  first lien mortgage  loans not more than 90 days  delinquent  and
having a loan-to-value  ratio of


                                       32
<PAGE>

not more than 80% at  origination  unless  insured  to such  ratio by an insurer
approved by the Fannie Mae or the Freddie  Mac,  qualifying  residential  bridge
loans made  directly  for the  construction  of  single-family  residences,  and
qualifying multi-family  residential loans; and (d) 100% for all other loans and
investments,  including  consumer loans,  commercial  loans,  and  single-family
residential real estate loans more than 90 days delinquent,  and for repossessed
assets.

           In  August  1993,  the OTS  adopted  a final  rule  incorporating  an
interest-rate risk component into the risk-based capital  regulation.  Under the
rule, an  institution  with a greater than "normal"  level of interest rate risk
will be subject to a deduction of its interest  rate risk  component  from total
capital for purposes of calculating its risk-based capital. As a result, such an
institution will be required to maintain  additional  capital in order to comply
with the risk-based  capital  requirement.  An  institution  with a greater than
"normal"  interest  rate risk is defined as an  institution  that would suffer a
loss of net portfolio  value  exceeding 2.0% of the estimated  economic value of
its assets in the event of a 200 basis point  increase or decrease (with certain
minor  exceptions) in interest  rates.  The interest rate risk component will be
calculated,  on a quarterly  basis,  as one-half  of the  difference  between an
institution's  measured interest rate risk and 2.0%,  multiplied by the economic
value of its assets.  The rule also  authorizes  the Director of the OTS, or his
designee,  to waive or defer an institution's  interest rate risk component on a
case-by-case  basis.  The final rule was  originally  effective as of January 1,
1994,  subject however to a two quarter "lag" time between the reporting date of
the data used to calculate an institution's interest rate risk and the effective
date of each quarter's  interest rate risk component.  However,  in October 1994
the Director of the OTS indicated that it would waive the capital deductions for
institutions  with a greater  than  "normal"  risk  until the OTS  published  an
appeals  process.  On August 21, 1995, the OTS released Thrift Bulletin 67 which
established (1) an appeals process to handle  "requests for  adjustments" to the
interest  rate  risk  component  and (2) a process  by which  "well-capitalized"
institutions may obtain  authorization to use their own interest rate risk model
to  determine  their  interest  rate risk  component.  The  Director  of the OTS
indicated,  concurrent with the release of Thrift Bulletin 67, that the OTS will
continue to delay the  implementation of the capital deduction for interest rate
risk pending the testing of the appeals process set forth in Thrift Bulletin 67.

           Under  the  revised  OTS  policy,  savings  institutions  must  value
securities available for sale at amortized cost for regulatory capital purposes.
This means that in computing regulatory capital, savings institutions should add
back any unrealized losses and deduct any unrealized gains, net of income taxes,
on debt  securities  reported  as a separate  component  of GAAP  capital.  This
decreased  the  Association's   regulatory  capital  at  December  31,  2000  by
approximately $19,000.



                                       33
<PAGE>

           At December 31, 2000, the Association  exceeded all of its regulatory
capital  requirements,  with  tangible,  core and  risk-based  capital ratios of
10.1%,  10.0% and  21.2%,  respectively.  The  following  table  sets  forth the
Association's  compliance with each of the above-described  capital requirements
as of December 31, 2000.

<TABLE>
<CAPTION>

IBL Bancorp, Inc.
Regulatory Capital Requirements
                                                      Tangible       Core      Risk-based
                                                       Capital     Capital     Capital (1)
                                                       -------     -------     -----------
                                                              (Dollars in Thousands)
<S>                                                     <C>         <C>              <C>
Capital under GAAP                                      $3,183      $   3,183        $3,183
Additional capital items:
  Unrealized loss on securities available for sale,        (19)           (19)          (19)
  General valuation allowances (2)                          --             --           199
                                                        ------      ---------        ------
Regulatory Capital                                       3,164          3,164         3,363

Minimum required regulatory capital                        475          1,266         1,270

Excess regulatory capital                               $2,689      $   1,898        $2,093
                                                        ======      =========        ======
Regulatory capital as a percentage of assets (3)         10.00%         10.00%        21.18%

Minimum capital required as a percentage of
 assets                                                   1.50%          4.00%         8.00%
                                                        ------      ---------        ------
Regulatory capital as a percentage in
 excess of requirements                                   8.50%          6.00%        13.18%
                                                        ======      =========        ======

</TABLE>

(1)  Does not reflect the interest-rate risk component in the minimum risk-based
     capital  requirement,  the  effective  date of which has been  postponed as
     discussed above.

(2)  General valuation allowances are used only in the calculation of risk-based
     capital. Such allowances are limited to 1.25% of risk weighted assets.

(3)  Tangible and core capital are  computed as a percentage  of adjusted  total
     assets of $31.6 million.  Risk-based capital is computed as a percentage of
     adjusted risk-weighted assets of $15.9 million.




                                       34
<PAGE>


           Any savings institution that fails any of the capital requirements is
subject to possible  enforcement  actions by the OTS or the FDIC.  Such  actions
could  include a  capital  directive,  a cease and  desist  order,  civil  money
penalties,  the establishment of restrictions on the  institution's  operations,
termination of federal deposit insurance and the appointment of a conservator or
receiver.  The OTS'  capital  regulation  provides  that such  actions,  through
enforcement proceedings or otherwise,  could require one or more of a variety of
corrective actions.

           Prompt  Corrective   Action.   Under  the  prompt  corrective  action
regulations of the OTS, an institution is deemed to be (a) "well capitalized" if
it has  total  risk-based  capital  of 10.0% or  more,  has a Tier 1  risk-based
capital  ratio of 6.0% or more,  has a Tier 1 leverage  capital ratio of 5.0% or
more and is not  subject  to any order or final  capital  directive  to meet and
maintain a specific  capital  level for any  capital  measure,  (b)  "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,"  (c)  "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 Tier 1  leverage  capital  ratio that is less
than   4.0%   (3.0%   under   certain    circumstances),    (d)   "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 Tier 1
leverage   capital   ratio  that  is  less  than  3.0%,   and  (e)   "critically
undercapitalized"  if it has a ratio of tangible  equity to total assets that is
equal to or less than 2.0%.  Under  specified  circumstances,  a federal banking
agency may reclassify a well capitalized  institution as adequately  capitalized
and may require an adequately  capitalized  institution  or an  undercapitalized
institution to comply with  supervisory  actions as if it were in the next lower
category   (except   that   the  FDIC  may  not   reclassify   a   significantly
undercapitalized institution as critically undercapitalized).

           An institution generally must file a written capital restoration plan
which meets specified  requirements with its appropriate  federal banking agency
within 45 days of the date that 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 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. In addition,  undercapitalized  institutions are subject to various
regulatory  restrictions,  and the  appropriate  federal banking agency also may
take any number of discretionary supervisory actions.

           At December 31, 2000, the Association  was deemed a well  capitalized
institution for purposes of the above  regulations and as such is not subject to
the above mentioned restrictions.


                                       35
<PAGE>



           Safety and Soundness. The OTS and other federal banking agencies have
established  guidelines for safety and  soundness,  addressing  operational  and
managerial  standards,  as well as  compensation  matters for insured  financial
institutions.  Institutions  failing to meet these  standards  are  required  to
submit compliance plans to their appropriate federal regulators. The OTS and the
other  agencies have also  established  guidelines  regarding  asset quality and
earnings standards for insured institutions. The Association believes that it is
in compliance with these guidelines and standards.

           Liquidity  Requirements.  All savings  institutions  are  required to
maintain an average daily balance of liquid assets equal to a certain percentage
of the sum of its average daily balance of net withdrawable deposit accounts and
borrowings payable in one year or less. The liquidity  requirement may vary from
time to time (between 4% and 10%) depending upon economic conditions and savings
flows of all savings  institutions.  At the present time,  the required  minimum
liquid  asset ratio is 4%. At December  31, 2000,  the  Association's  liquidity
ratio was 9.17%.

           Capital  Distributions.  OTS regulations govern capital distributions
by savings  institutions,  which include cash  dividends,  stock  redemptions or
repurchases,  and other transactions charged to the capital account of a savings
institution to make capital  distributions.  A savings  institution must file an
application for OTS approval of the capital distribution if either (1) the total
capital  distributions  for the  applicable  calendar year exceed the sum of the
institution's net income for that year to date plus the  institution's  retained
net income for the  preceding  two years,  (2) the  institution  would not be at
least adequately  capitalized  following the distribution,  (3) the distribution
would  violate any  applicable  statute,  regulation,  agreement or  OTS-imposed
condition, or (4) the institution is not eligible for expedited treatment of its
filing.  If an  application  is not required to be filed,  savings  institutions
which  are  a  subsidiary  of a  holding  company  (as  well  as  certain  other
institutions)  must still file a notice with the OTS at least 30 days before the
board of directors declares a dividend or approves a capital distribution.

           Loans  to  One  Borrower.  The  permissible  amount  of  loans-to-one
borrower now generally  follows the national bank standard for all loans made by
savings  institutions.  The national  bank  standard  generally  does not permit
loans-to-one  borrower to exceed the  greater of  $500,000 or 15% of  unimpaired
capital and surplus. Loans in an amount equal to an additional l0% of unimpaired
capital  and  surplus  also may be made to a  borrower  if the  loans  are fully
secured by readily  marketable  securities.  For  information  about the largest
borrowers  from  the  Association,   see  "Description  of  Business  -  Lending
Activities - Real Estate Lending Standards and Underwriting Policies."

           Classified  Assets.  Federal  regulations  require  that each insured
savings  institution  classify its assets on a regular  basis.  In addition,  in
connection with  examinations of insured  institutions,  federal  examiners have
authority to identify  problem assets and, if appropriate,  classify them. There
are three  classifications  for problem  assets:  "substandard,"  "doubtful" and
"loss."  Substandard  assets  have  one  or  more  defined  weaknesses  and  are
characterized  by the distinct  possibility  that the

                                       36
<PAGE>

insured  institution  will  sustain  some  loss  if  the  deficiencies  are  not
corrected.  Doubtful assets have the weaknesses of substandard  assets, with the
additional  characteristic that the weaknesses make collection or liquidation in
full  on  the  basis  of  currently   existing  facts,   conditions  and  values
questionable,  and there is a high possibility of loss. An asset classified loss
is  considered  uncollectible  and of such little value that  continuance  as an
asset of the institution is not warranted.  Another category designated "special
mention"  also  must be  established  and  maintained  for  assets  which do not
currently  expose  an  insured  institution  to a  sufficient  degree of risk to
warrant  classification  as substandard,  doubtful or loss. Assets classified as
substandard or doubtful require the institution to establish general  allowances
for loan losses.  If an asset or portion thereof is classified loss, the insured
institution  must either  establish  specific  allowances for loan losses in the
amount of 100% of the portion of the asset  classified  loss, or charge-off such
amount.  General loss allowances established to cover possible losses related to
assets  classified  substandard  or doubtful may be included in  determining  an
institution's regulatory capital up to certain amounts, while specific valuation
allowances  for loan  losses  do not  qualify  as  regulatory  capital.  Federal
examiners may disagree with an insured institution's classifications and amounts
reserved. See "Description of Business - Asset Quality - Classified Assets."

           Community  Reinvestment  Act  and  the  Fair  Lending  Laws.  Savings
institutions have a responsibility under the Community  Reinvestment Act of 1977
("CRA")  and  related  regulations  of the OTS to help meet the credit  needs of
their  communities,   including  low-  and  moderate-income  neighborhoods.   In
addition,  the Equal Credit  Opportunity Act and the Fair Housing Act (together,
the "Fair Lending Laws") prohibit lenders from  discriminating  in their lending
practices  on the  basis of  characteristics  specified  in those  statutes.  An
institution's  failure to comply with the provisions of CRA could, at a minimum,
result in regulatory restrictions on its activities,  and failure to comply with
the Fair Lending Laws could result in enforcement actions by the OTS, as well as
other federal regulatory agencies and the Department of Justice.

           Qualified  Thrift Lender Test. All savings  institutions are required
to meet a  qualified  thrift  lender  or QTL  test in  order  to  avoid  certain
restrictions on their operations.  A savings institution can comply with the QTL
test by either qualifying as a domestic building and loan association as defined
in  Section  7701(a)  (19) of the  Internal  Revenue  Code of 1986,  as  amended
("Code") or meeting the second prong of the QTL test set forth in Section  10(m)
of the HOLA. A savings  institution  that does not meet the QTL test must either
convert  to a bank  charter or comply  with the  following  restrictions  on its
operations:  (1) the  institution may not engage in any new activity or make any
new  investment,  directly or indirectly,  unless such activity or investment is
permissible  for a national  bank; (2) the branching  powers of the  institution
shall be restricted to those of a national bank; (3) the  institution  shall not
be eligible to obtain any advances  from its FHLB;  and (4) payment of dividends
by the institution  shall be subject to the rules regarding payment of dividends
by a national bank. Upon the expiration of three years from the date the savings
institution  ceases to meet the QTL test,  it must  cease any  activity  and not
retain any investment not permissible for a national bank and immediately  repay
any outstanding FHLB advances (subject to safety and soundness considerations).


                                       37
<PAGE>

           Currently,  the  prong of the QTL test  that is not based on the Code
requires that 65% of an institution's "portfolio assets" (as defined) consist of
certain housing and  consumer-related  assets on a monthly average basis in nine
out of very 12 months.  Assets that qualify  without limit for inclusion as part
of the 65% requirement are loans made to purchase, refinance, construct, improve
or repair domestic  residential  housing and manufactured  housing;  home equity
loans;  mortgage-backed  securities (where the mortgages are secured by domestic
residential  housing  or  manufactured  housing);  stock  issued  by the FHLB of
Dallas;  and  direct or  indirect  obligations  of the FDIC.  In  addition,  the
following assets,  among others,  may be included in meeting the test subject to
an overall limit of 20% of the savings  institution's  portfolio assets:  50% of
residential  mortgage loans  originated and sold within 90 days of  origination;
100% of  consumer  and  educational  loans  (limited  to 10% of total  portfolio
assets); and stock issued by the Freddie Mac or the Fannie Mae. Portfolio assets
consist  of total  assets  minus the sum of (1)  goodwill  and other  intangible
assets,  (2) property used by the savings  institution  to conduct its business,
and (3) liquid assets up to 20% of the  institution's  total assets. At December
31, 2000, the qualified thrift investments of the Association were approximately
99.24% of its portfolio assets.

           Federal Home Loan Bank  System.  The  Association  is a member of the
FHLB of Dallas,  which is one of 12  regional  FHLBs that  administers  the home
financing credit function of savings institutions. Each FHLB serves as a reserve
or  central  bank for its  members  within  its  assigned  region.  It is funded
primarily from proceeds derived from the sale of consolidated obligations of the
FHLB  System.  It makes loans to members  (i.e.,  advances) in  accordance  with
policies and procedures established by the Board of Directors of the FHLB.

           As a member,  the  Association  is required to purchase  and maintain
stock in the FHLB of Dallas in an amount  equal to at least 1% of its  aggregate
unpaid   residential   mortgage  loans,  home  purchase   contracts  or  similar
obligations at the beginning of each year. At December 31, 2000, the Association
had $208,300 in FHLB stock, which was in compliance with this requirement.

           The  FHLBs are  required  to  provide  funds  for the  resolution  of
troubled savings  institutions and to contribute to affordable  housing programs
through  direct loans or interest  subsidies on advances  targeted for community
investment and low-and  moderate-income  housing projects.  These  contributions
have  adversely  affected the level of FHLB dividends paid in the past and could
continue to do so in the future.

           Federal Reserve System. The FRB requires all depository  institutions
to maintain reserves against their transaction accounts (primarily NOW and Super
NOW checking accounts) and non-personal time deposits.  As of December 31, 2000,
no  reserves  were  required  to be  maintained  on the first  $5.5  million  of
transaction accounts,  reserves of 3% were required to be maintained against the
next $42.8 million of net transaction accounts (with such dollar amounts subject
to adjustment by the FRB),  and a reserve of 10% (which is subject to adjustment
by the FRB to a level between 8% and 14%) is required  against all remaining net
transaction  accounts.  Because required reserves must be maintained in the form
of vault cash or a  non-interest-bearing  account at a Federal Reserve Bank, the
effect of this reserve requirement is to reduce an institution's earning assets.

                                       38
<PAGE>


           Thrift Charter.  Congress has been considering legislation in various
forms that would  require  savings  institutions,  such as the  Association,  to
convert their  charters to national or state bank charters.  Recent  legislation
required the Treasury  Department to prepare for Congress a comprehensive  study
on  development  of a common  charter for savings  institutions  and  commercial
banks.  The  Association  cannot  determine  whether,  or  in  what  form,  such
legislation  may  eventually  be enacted and there can be no assurance  that any
legislation  that is enacted would not adversely  affect the Association and its
parent holding company.

           Louisiana Regulation.  As a Louisiana-chartered  savings association,
the  Association  also is subject to regulation and  supervision by the OFI. The
Association is required to file periodic reports with and is subject to periodic
examinations  at  least  once  every  two  years  by the OFI.  The  lending  and
investment  authority of the  Association  is prescribed  by Louisiana  laws and
regulations,  as  well as  applicable  federal  laws  and  regulations,  and the
Association is prohibited  from engaging in any activities not permitted by such
law and regulations.

           The  Association  is required by  Louisiana  law and  regulations  to
comply with certain reserve and capital requirements.  At December 31, 2000, the
Association  was  in  compliance   with  all  applicable   reserve  and  capital
requirements.

           Louisiana  law  and   regulations   also  restrict  the  lending  and
investment authority of Louisiana-chartered savings institutions.  Such laws and
regulations  restrict the amount a  Louisiana-chartered  savings association can
lend to any one borrower to an amount which,  in the aggregate,  does not exceed
the lesser of (a) 10% of the  association's  savings  deposits or (b) the sum of
the association's paid-in capital,  surplus,  reserves for losses, and undivided
profits. Federal law imposes more restrictive limitations. See "Business-Lending
Activities."  Notwithstanding  the foregoing,  Louisiana and federal law permits
any such association to lend to any one borrower an aggregate amount of at least
$500,000.


           In   addition,    Louisiana    law    restricts    the   ability   of
Louisiana-chartered  savings  associations to invest in, among other things, (a)
commercial  real estate loans  (including  commercial  construction  real estate
loans) up to 40% of total assets; (b) real estate investments for other than the
association's offices up to 10% of total assets; (c) consumer loans,  commercial
paper and corporate debt  securities up to 30% of total assets;  (d) commercial,
corporate,  business or  agricultural  loans up to 10% of total assets;  and (e)
capital stock,  obligations and other securities of service  organizations up to
10% of total assets.  Louisiana law also sets forth maximum loan-to-value ratios
with respect to various types of loans.  Applicable  federal  regulations impose
more  restrictive  limitations  in  certain  instances.   See  "Business-Lending
Activities-Real Estate Lending Standards and Underwriting Policies."

           The investment authority of Louisiana-chartered  savings associations
is broader in many  respects than that of  federally-chartered  savings and loan
associations.   However,  state-chartered  savings  associations,  such  as  the
Association,  are generally  prohibited  from  acquiring or retaining any equity
investment, other than certain investments in service corporations, of a type or
in  an  amount  that  is  not  permitted  for  a

                                       39
<PAGE>

federally-chartered  savings  association.  This  prohibition  applies to equity
investments  in real  estate,  investments  in equity  securities  and any other
investment or transaction that is in substance an equity investment, even if the
transaction is nominally a loan or other  permissible  transaction.  At December
31, 2000, the Association was in compliance with such provisions.

           Furthermore,  a state-chartered savings association may not engage as
principal in any activity not permitted for federal associations unless the FDIC
has determined that such activity would pose no significant risk to the affected
deposit  insurance fund and the Association is in compliance with all applicable
capital  requirements.  When certain  activities are  permissible  for a federal
association, the state association may engage in the activity in a higher amount
if the FDIC has not determined that such activity would pose a significant  risk
of loss to the affected  deposit  insurance fund and the  Association  meets the
fully phased-in capital  requirements.  This increased investment authority does
not apply to investments in  nonresidential  real estate loans.  At December 31,
2000, the  Association  had no investments  which were affected by the foregoing
limitations.

           Under Louisiana law, a  Louisiana-chartered  savings  association may
establish  or  maintain  a  branch  office  anywhere  in  Louisiana  with  prior
regulatory approval. In addition, an out-of-state savings association or holding
company may acquire a Louisiana-chartered savings association or holding company
if  the  OFI   determines   that  the  laws  of  such  other   state   permit  a
Louisiana-chartered  savings association or holding company to acquire a savings
association or holding company in such other state. Any such  acquisition  would
require the out-of-state entity to apply to the OFI and receive OFI approval.

                                       40
<PAGE>


                                    TAXATION

           Federal Taxation

           General. The Company and the Association are subject to the generally
applicable  corporate tax provisions of the Code, and the Association is subject
to certain  additional  provisions  of the Code which apply to thrifts and other
types of financial institutions. The following discussion of federal taxation is
intended only to summarize certain pertinent federal income tax matters material
to the taxation of the Company and the  Association  and is not a  comprehensive
discussion of the tax rules applicable to the Company and the Association.

           Year. The Company and the Association file federal income tax returns
on the basis of a calendar  year ending on December 31, and it is expected  that
separate returns will be filed for 2000 and 2001.

           Bad Debt  Reserves.  In August  1996,  legislation  was enacted  that
repealed the reserve  method of accounting  (including the percentage of taxable
income method)  previously used by many savings  institutions to calculate their
bad debt reserve for federal income tax purposes. Savings institutions with $500
million or less in assets may, however,  continue to use the experience  method.
The  Association  must  recapture  that portion of its reserve which exceeds the
amount that could have been taken under the experience  method for post-1987 tax
years.  At December  31,  2000,  the  Association's  post-1987  excess  reserves
amounted  to  approximately  $43,000.  The  legislation  also  requires  savings
institutions  to account  for bad debts for federal  income tax  purposes on the
same basis as commercial  banks for tax years beginning after December 31, 1995.
This change in  accounting  method and reversal and excess bad debt  reserves is
adequately provided for in the Association's deferred tax liability.

           At  December  31,  2000,  the  federal  income  tax  reserves  of the
Association included $110,577 for which no federal income tax has been provided.
Because  of these  federal  income  tax  reserves  and the  liquidation  account
established  for  the  benefit  of  certain  depositors  of the  Association  in
connection  with the  conversion of the  Association to stock form, the retained
earnings of the Association are substantially restricted.

           Distributions. If the Association were to distribute cash or property
to its sole  stockholder,  and the  distribution  was  treated as being from its
accumulated bad debt reserves,  the distribution  would cause the Association to
have additional  taxable income. A distribution is deemed to have been made from
accumulated  bad debt  reserves to the extent that (a) the  reserves  exceed the
amount that would have been  accumulated on the basis of actual loss experience,
and (b) the distribution is a "non-qualified  distribution." A distribution with
respect to stock is a non-qualified distribution to the extent that, for federal
income tax purposes,  (1) it is in redemption of shares, (2) it is pursuant to a
liquidation of the  institution,  or (3) in the case of a current  distribution,
together with all other such  distributions  during the taxable year, it exceeds
the institution's  current and post-1951  accumulated  earnings and profits. The
amount of additional  taxable income created by a non-qualified  distribution is
an amount that when reduced by the tax attributable to it is equal to the amount
of the distribution.

                                       41
<PAGE>

           Minimum Tax. The Code imposes an alternative minimum tax at a rate of
20%. The alternative  minimum tax generally applies to a base of regular taxable
income plus certain tax  preferences  ("alternative  minimum  taxable income" or
("AMTI")  and is payable to the  extent  such AMTI is in excess of an  exemption
amount.  The Code provides  that an item of tax  preference is the excess of the
bad debt  deduction  allowable for a taxable year pursuant to the  percentage of
taxable income method over the amount  allowable  under the  experience  method.
Other items of tax preference that constitute AMTI include (a)  depreciation and
(b) 75% of the excess (if any) of (1)  adjusted  current  earnings as defined in
the Code, over (2) AMTI (determined  without regard to this preference and prior
to reduction by net operating losses).

           Capital Gains and Corporate Dividends-Received  Deduction.  Corporate
net  capital   gains  are  taxed  at  a  maximum  rate  of  35%.  The  corporate
dividends-received  deduction  is 80% in the  case of  dividends  received  from
corporations  with which a corporate  recipient does not file a consolidated tax
return,  and corporations  which own less than 20% of the stock of a corporation
distributing a dividend may deduct only 70% of dividends  received or accrued on
their behalf.  However, a corporation may deduct 100% of dividends from a member
of the same affiliated group of corporations.

           Other Matters.  Federal  legislation is introduced  from time to time
that would limit the ability of individuals to deduct  interest paid on mortgage
loans.  Individuals  are currently not permitted to deduct  interest on consumer
loans.  Significant  increases  in tax  rates  or  further  restrictions  on the
deductibility of mortgage interest could adversely affect the Association.

           The Association's  federal income tax returns for the tax years ended
1997,  1998,  1999 and 2000 are open under the  statute of  limitations  and are
subject to review by the IRS. The  Association's tax return for 1994 was audited
by the IRS without material adjustment.

State Taxation

           The Company is subject to the Louisiana  Corporation Income Tax based
on its Louisiana  taxable income,  as well as franchise  taxes.  The Corporation
Income  Tax  applies  at  graduated  rates  from 4% upon the  first  $25,000  of
Louisiana  taxable  income to 8% on all  Louisiana  taxable  income in excess of
$200,000. For these purposes,  "Louisiana taxable income" means net income which
is earned within or derived from sources  within the State of  Louisiana,  after
adjustments  permitted  under  Louisiana  law,  including  a federal  income tax
deduction  and an  allowance  for net  operating  losses,  if any. In  addition,
beginning in 1999, the Association is subject to the Louisiana Shares Tax, which
is imposed on the  assessed  value of its stock.  The formula for  deriving  the
assessed  value  is to  calculate  15% of the  sum of (a)  20% of the  company's
capitalized  earnings,  plus  (b)  80% of the  company's  taxable  stockholders'
equity,  and to subtract from that figure 50% of the company's real and personal
property  assessment.  Various  items may also be  subtracted  in  calculating a
company's capitalized earnings. In 2000 the Louisiana Shares Tax for the Company
amounted to $31,000.

                                       42
<PAGE>

Item 2. Description of Property.

           At December 31, 2000, the Company and the Association conducted their
business  from the  Association's  main  office in  Plaquemine,  Louisiana.  The
following  table  sets  forth  the net book  value  (including  furnishings  and
equipment) and certain other  information  with respect to the offices and other
properties of the Company at December 31, 2000.


IBL Bancorp, Inc.
Properties
                                            As of December 31, 2000
                                            -----------------------
                                                     Net Book
                                      Leased/        Value of
Description/Address                    Owned         Property         Deposits
-------------------                    -----         --------         --------
                                                (Dollars in thousands)
Home Office:
23910 Railroad Avenue
Plaquemine, Louisiana                  Owned         $    115           $24,567

Branch Office
None                                       -                -                 -



The  estimated  net book value of electronic  data  processing  and other office
equipment owned by the Association was $18,000 at December 31, 2000.

Item 3. Legal Proceedings.

           The  Company  and the  Association  are  involved  in  routine  legal
proceedings  occurring  in  the  ordinary  course  of  business  which,  in  the
aggregate,  are believed by  management  to be  immaterial  to the  consolidated
financial condition and results of operations of the Company.

Item 4. Submission of Matters to a Vote of Security Holders.

        Not applicable.

PART II.

Item 5. Market for Common Equity and Related Stockholder Matters.

           The  information  required  herein,  to  the  extent  applicable,  is
incorporated by reference on pages 3 and 47 of the Company's 2000 Annual Report.


                                       43
<PAGE>

Item 6. Management's Discussion and Analysis or Plan of Operation.

           The  information  required  herein is  incorporated by reference from
pages 6 to 15 of the 2000 Annual Report.

Item 7. Financial Statements.

           The  information  required  herein is  incorporated by reference from
pages 16 to 46 of the 2000 Annual Report.


Item 8. Changes in and Disagreements With Accountants on Accounting and
        Financial Disclosure.

           Not applicable.


PART III.


Item 9. Directors, Executive Officers, Promoters and Control Persons;
        Compliance with Section 16 (a) of the Exchange Act.

           The  information  required  herein is  incorporated by reference from
pages 3 and 9 of the  definitive  proxy  statement of the Company for the Annual
Meeting of Stockholders  to be held on April 25, 2001,  which was filed on March
27, 2001 ("Definitive Proxy Statement")

Item 10. Executive Compensation.

           The  information  required  herein is  incorporated by reference from
pages 8 to 12 the Definitive Proxy Statement.

Item 11. Security Ownership of Certain Beneficial Owners and Management.

           The  information  required  herein is  incorporated by reference from
pages 5 to 8 the Definitive Proxy Statement.

Item 12. Certain Relationships and Related Transactions.

           The  information  required  herein is  incorporated by reference from
pages 13 to 14 the Definitive Proxy Statement.



                                       44



Item 13. Exhibits, List and Reports on Form 8-K.

           (a) Documents Filed as Part of this Report

           (1) The following financial  statements are incorporated by reference
from Item 7 hereof (see Exhibit 13):

               Independent Auditor's Report.
               Consolidated  Statements of Financial
                Condition  as of  December  31, 2000
                and 1999.
               Consolidated Statements of Income and
                Comprehensive  Income  for the Years
                Ended December 31, 2000 and 1999.
               Consolidated Statements of Changes in
                Shareholders'  Equity  for the Years
                ended December 31, 2000 and 1999.
               Consolidated Statements of Cash Flows
                for the  Years  Ended  December  31,
                2000 and 1999.
               Notes to Consolidated Financial Statements.

           (2) All  schedules  for  which  provision  is made in the  applicable
accounting  regulations of the Securities  and Exchange  Commission  ("SEC") are
omitted  because of the absence of  conditions  under which they are required or
because the  required  information  is included  in the  consolidated  financial
statements and related notes thereto.

           (3) The  following  exhibits  are filed as part of this Form  l0-KSB,
this list includes the Exhibit Index.

                2.1*    Plan of Conversion
                3.1*    Articles of Incorporation of IBL Bancorp, Inc.
                3.2*    Bylaws of IBL Bancorp, Inc.
                4.1*    Stock Certificate of IBL Bancorp, Inc.
                10.1*   Employment Agreement among IBL Bancorp,  Inc., Iberville
                        Building and Loan  Association and G. Lloyd  Bouchereau,
                        Jr., dated September 30, 1998
                10.2*   Employment Agreement among IBL Bancorp,  Inc., Iberville
                        Building and Loan  Asociation  and Danny M.  Strickland,
                        dated September 30, 1998
                10.3**  1999 Stock Option Plan
                10.4**  1999 Recognition and Retention Plan and Trust Agreement


           (*) Incorporated herein by reference from the Company's  Registration
Statement on Form SB-2  (Registration  No.  333-57623) filed by the Company with
the SEC on June 24, 1998, as subsequently amended.

           (**) Incorporated  herein by reference from the Company's Form 10-KSB
for the year ended December 31, 1999. (b) Reports on Form 8-K

                                       45
<PAGE>

           (b) Reports on Form 8-K

           The  Company  did not file any  reports on Form 8-K during the fourth
quarter of the year ended December 31, 2000.





                                       46

<PAGE>



                                   SIGNATURES

                                         In accordance  with Section 13 or 15(d)
of the  Exchange  Act,  the  registrant  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                          IBL BANCORP, INC.


                                          By:  /s/G. Lloyd Bouchereau, Jr.
                                               ---------------------------
                                               G. Lloyd Bouchereau, Jr.
                                               President and
                                               Chief Executive Officer

                                         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 date indicated.

    Name                             Title                        Date
    ----                             -----                        ----

/s/ G. Lloyd Bouchereau, Jr.         President and Chief          March 12, 2001
----------------------------         Executive Officer
G. Lloyd Bouchereau, Jr.

/s/ Bobby E. Stanley                 Director                     March 12, 2001
--------------------
Bobby E. Stanley

/s/ John L. Delahaye                 Director                     March 12, 2001
--------------------
John L. Delahaye

/s/ Gary K. Pruitt                   Director                     March 12, 2001
 -----------------
Gary K. Pruitt

/s/ Edward J. Steinmetz              Director                     March 12, 2001
 ----------------------
Edward J. Steinmetz

/s/ Danny M. Strickland              Director                     March 12, 2001
-----------------------
Danny M. Strickland

                                       47