<PAGE>


                     U.S. Securities and Exchange Commission
                                Washington, D.C.

                                   Form 10-Q


              [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                 For the quarterly period ended March 31, 1999

             [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
                                  EXCHANGE ACT

                 For the transition period to


                 Commission file number 0-27474
  

                            American Bancshares, Inc.
                (Exact Name of Registrants Specified in its Charter)


                 Florida                             65-0624640
        (State or other Jurisdiction            (IRS Emloyer Id. No.)
        Incorporation or Organization)

                 4502 Cortez Road West, Bradenton, Florida 34210
                      (Address of Principal Executive Offices)

                                 (941) 795-3050
                (Registrants telephone number including area code)

                 4702 Cortez Road West, Bradenton, Florida 34210
              ----------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)



Check  whether  the issuer  has(1)  filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during the past 12
months (or for shorter  period  that the  registrant  was  required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days.
         Yes X  No    .
            ---   ---

Number of shares outstanding of the issuer's Common Stock, par value $1.175 as
of March 31, 1999: 5,028,584 shares.
<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                         Page
<S>       <C>                                                          <C>
Part I    FINANCIAL INFORMATION

          Item 1
               -Financial Statements                                     1-3

               -Notes to Consolidated Condensed Financial Statements     4-6

          Item 2
               -Management's Discussion and Analysis
                of Financial Condition and Results of
                Operations                                               7-8

          Item 2.A
               -Year 2000 Compliance                                       9

          Item 3   
               -Quantitative and Qualitative Disclosure                   10
                About Market Risk   


Part II   OTHER INFORMATION

          Item 1     Legal Proceedings                                    
                     (Not applicable)                                    n/a

          Item 2     Changes in Securities                                
                     (Not applicable)                                    n/a

          Item 3     Defaults Upon Senior Securities
                     (Not applicable)                                    n/a

          Item 4     Submission of Matters to a Vote
                     of Security Holders
                     (Not applicable)                                    n/a

          Item 5     Other Information
                     (Not applicable)                                    n/a

          Item 6     Exhibits and Reports on Form 8-K                     11
</TABLE>
<PAGE>


PART 1 - FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS

American Bancshares, Inc. and Subsidiaries
Consolidated Condensed Balance Sheets
(unaudited, $ in thousands)
<TABLE>
<CAPTION>

                                                    March 31,    December 31,      %           $
Assets                                                 1999         1998         Change      Change
                                                  -------------  ------------   --------   ----------
<S>                                                 <C>          <C>          <C>       <C>
  Cash and due from banks                              19,212       20,215         (4.96)     (1,003)
  Interest bearing deposits in banks                       25          104        (75.96)        (79)
  Mortgage loans held for sale                        104,928       88,158         19.02      16,770
  Investment securities, available for sale            43,983       48,323         (8.98)     (4,340)
  Mortgage-backed securities, available for sale       37,966       28,755         32.03       9,211
  Loans (net of allowance for credit losses and
   deferred loan fees of $1,692 as of
   March 31, 1999 and $1,620 as of
   December 31, 1998)                                 262,981      248,808          5.70      14,173
  Premises and equipment, net                          13,196       12,894          2.34         302
  Other real estate owned, net                            506        1,003        (49.55)       (497)
  Goodwill                                                 73           74         (1.35)         (1)
  Other assets                                          7,565        6,830         10.76         735
                                                    ---------    ---------     ---------    --------
  Total assets                                        490,435      455,164          7.75      35,271
                                                    =========   ==========     =========    ========

Liabilities and shareholders' equity

Liabilities
  Deposits                                            356,841      344,845          3.48      11,996
  Securities sold under agreements to repurchase       31,249       29,592          5.60       1,657
  Federal funds purchased and FHLB borrowings          55,510       34,900         59.05      20,610
  Guaranteed Preferred Beneficial Interests in 
   the Company's Junior Subordinated Debentures        16,249       16,249          0.00           0
  Other liabilities                                     2,834        2,151         31.75         683
                                                    ---------    ---------     ---------    --------
    Total liabilities                                 462,683      427,737          8.17      34,946

Shareholders' equity
  Preferred shares, 5,000,000 shares authorized,
  0 shares issued and outstanding as of 
  March 31,1999                                             0            0          0.00           0

  Common shares, $1.175 par value, 20,000,000
   shares authorized, 5,028,584 shares issued
   and outstanding as of  March 31, 1999
   and 4,994,984 as of December 31, 1998                5,910        5,870          0.68          40
  Additional paid in capital                           15,687       15,551          0.87         136
  Accumulated other comprehensive income, net            (396)        (143)       176.92        (253)
  Retained earnings                                     6,551        6,149          6.54         402
                                                    ---------    ---------     ---------    --------
    Total shareholders' equity                         27,752       27,427          1.18         325
                                                    ---------    ---------     ---------    --------
Total liabilities and shareholders' equity            490,435      455,164          7.75      35,271
                                                    =========    =========     =========    ========

</TABLE>

The accompanying notes are an integral part of these financial statements.



                                     Page 1
<PAGE>
 American Bancshares, Inc. and Subsidiaries
 Consolidated Condensed Statements of Income
 (unaudited, $ in thousands)
<TABLE>
<CAPTION>
                                                    Three Month's Ended March 31,       %             $
                                                         1999           1998          Change        Change
                                                      -----------    -----------    ----------   -----------
<S>                                                   <C>            <C>            <C>          <C>
Interest income
  Interest and fees on loans                               7,233           5,810         24.49          1,423
  Interest on mortgage backed securities, taxable            449              98        358.16            351
  Interest on investment securities, taxable                 734           1,033        (28.94)          (299)
  Interest on investment securities, nontaxable               23              17         35.29              6
  Other interest income                                        4             143        (97.20)          (139)
                                                        --------        --------     ---------      ---------
    Total interest income                                  8,443           7,101         18.90          1,342

Interest expense
  Deposits                                                 3,195           3,240         (1.39)           (45)
  Securities sold under agreements to repurchase             285             233         22.32             52
  Federal funds purchased and FHLB advances                  518              85        509.41            433
  Trust preferred securities                                 354               0        100.00            354
  Other borrowed money                                        (1)             25       (104.00)           (26)
                                                        --------        --------     ---------      ---------
    Total interest expense                                 4,351           3,583         21.43            768

Net interest income                                        4,092           3,518         16.32            574
Provision for loan losses                                    315             124        154.03            191
                                                        --------        --------     ---------      ---------
Net interest income after loan loss                        3,777           3,394         11.28            383

Noninterest income
  Service charges & fees                                     610             421         44.89            189
  Gain on sale of mortgage loans                             343             158        117.09            185
  Gain on sale of securities                                  10             122        (91.80)          (112)
  Gain on sale of servicing                                    7              22        (68.18)           (15)
  Broker loan fees                                            22              54        (59.26)           (32)
  Merchant fees                                              274             187         46.52             87
  Other income                                                79             139        (43.17)           (60)
                                                        --------        --------     ---------      --------- 
    Total noninterest income                               1,345           1,103         21.94            242

Noninterest expense
  Salaries & employee benefits                             1,968           1,510         30.33            458
  Net occupancy expense                                      283             195         45.13             88
  Furniture and equipment expenses                           320             239         33.89             81
  Data processing fees                                       265             351        (24.50)           (86)
  Interchange fee expenses                                   176             116         51.72             60
  Legal fees                                                  90             237        (62.03)          (147)
  Other expense                                            1,400           1,228         17.26            232
                                                        --------        --------     ---------      ---------
    Total noninterest expense                              4,502           3,876         16.15            626

Income before income taxes                                   620             621         (0.16)            (1)
Provision for income taxes                                   217             217          0.00              0
                                                        --------        --------     ---------      ---------
Net income                                                   403             404         (0.25)            (1)
                                                        ========        ========     =========      =========
Earnings per share (actual $'s)
   Basic                                                    0.08            0.08
   Diluted                                                  0.08            0.08

Average number of shares outstanding
   Basic                                               5,010,291       4,994,484
   Diluted                                             5,020,985       5,023,442

</TABLE>

The accompanying notes are an integral part of these financial statements.



                                     Page 2
<PAGE>

American Bancshares, Inc. and Subsidiaries
Consolidated Condensed Statement of Cashflows
(unaudited, $ in thousands)
<TABLE>
<CAPTION>
                                                     Three Months ended March 31,
                                                          1999           1998
                                                       ----------     ---------
<S>                                                   <C>            <C>        
Cash flows from operating activities:
 Net income                                                   403           404
                                                         --------      --------
 Adjustments to reconcile net income to net cash
  provided by operating activities:
  Provision for loan losses                                   315           124
  Net gain on sale of investment securities                   (10)         (120)
  Net gain on sale of loans                                  (344)         (158)
  Net gain on sale of mortgage servicing rights                (7)          (22)
  Depreciation                                                306           205
  Origination of loans held for sale (net of repayments)  (25,271)      (19,689)
  Proceeds from sales of loans held for sale                8,951         9,559
  Net amortization of premiums and accretion of
   discounts on investment securities                          10           (15)
  Increase in other liabilities                               683         1,443
  (Increase) decrease in other assets                        (411)       (1,204)
                                                         --------      --------
 Total adjustments                                        (15,778)       (9,877)
                                                         --------      --------
Net cash provided by operating activities                 (15,375)       (9,473)
                                                         --------      --------
Cash flows from investing activities:
 Loan originations, net of repayments                     (14,494)      (17,192)
 Purchases of bank premises and equipment                    (608)       (1,034)
 Proceeds from sales and maturities of available for
  sale investment securities                                5,297        19,534
 Purchases of available for sale investment
  securities, net of repayments                           (10,421)      (13,107)
 Recoveries on loans charged off                               81             0
                                                        ---------      --------
Net cash used in investing activities                     (20,145)      (11,799)
                                                        ---------      --------
Cash flows from financing activities:
 Net increase in demand deposits, NOW 
  and savings accounts                                     13,310        18,656
 Net increase (decrease) in time deposits                  (1,314)       (4,807)
 Net increase in securities sold under agreements to
  repurchase                                                1,657         8,737
 Net proceeds from advances (repayments)from the
  FHLB and Federal Funds purchased                         20,610           950
 Proceeds from issuance of stock                              175             0
                                                        ---------     ---------
Net cash provided by financing activities                  34,438        23,536
                                                        ---------     ---------
Net increase (decrease) in cash and cash equivalents       (1,082)        2,264
Cash and cash equivalents at beginning of period           20,319        18,396
                                                        ---------     ---------
Cash and cash equivalents at end of period                 19,237        20,660
                                                        =========     =========
Supplemental disclosures:
 Interest paid                                              4,289         3,486
                                                        =========     =========
 Income taxes paid                                             20           120
                                                        =========     =========
</TABLE>

The accompanying notes are an integral part of these financial statements.



                                     Page 3
<PAGE>
                       AMERICAN BANCSHARES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS




Note 1.    Holding Company and Subsidiaries Background Information

American  Bancshares,  Inc. (Company),  is a one bank holding company,  operated
under the laws of the state of Florida.  Its wholly-owned  banking subsidiary is
American Bank (Bank),  a state  chartered bank. The Holding  Company,  a Florida
corporation  organized June 30, 1995, is a registered  holding company under the
Bank Holding Company Act of 1956, as amended, and on December 1, 1995 became the
bank holding company for the Bank. The Bank was incorporated on December 6, 1988
and opened for business on May 8, 1989.  The Bank is a general  commercial  bank
with all the rights,  powers,  privileges  granted and  conferred by the Florida
Banking Code. Although the Holding Company was not formed until June 30,1995 and
did not acquire the Bank until December 1, 1995, the financial  statements  have
been presented as if the Company had been in existence since the Bank was formed
in 1988 and as if the Bank was it's wholly owned subsidiary since that time.

The Company organized a wholly-owned  Florida  subsidiary  corporation,  Freedom
Finance  Company,  ("Finance  Company"),  pursuant  to which it  engages in full
service  consumer  financing.  The Finance Company was incorporated on March 26,
1997 and opened  for  business on March 31, 1998.  The  Finance  Company  offers
consumer-driven  products and  services  ranging  from  mortgages to  automobile
loans,  home equity loans and education  financing.  The Finance Company has the
ability to extend financing to individuals and entities which may not be able to
satisfy the Bank's underwriting requirements or loan standards.

ABI Capital Trust  ("ABICT"),  a Delaware  statutory  trust,  was created on May
21,1998.  The ABICT exists for the exclusive  purpose of (i) issuing and selling
Common  Securities  and  Preferred  Securities  of ABICT  (together  the  "Trust
Securities"), (ii) using the proceeds of the sale of Trust Securities to acquire
Deferrable Interest Debentures ("Junior Subordinated  Debentures") issued by the
Company,   and  (iii)  engaging  only  in  those  other  activities   necessary,
convenient,  or incidental  thereto (such as  registering  the transfer of Trust
Securities).  Accordingly  the Junior  Subordinated  Debentures will be the sole
assets of the ABICT. The Company owns all of the Common Securities of ABICT, the
only voting security, and as a result it is a subsidiary of the Company.

Note 2.           Basis of Presentation

The accompanying unaudited condensed  consolidated financial statements,  in the
opinion  of  management,  include  all  adjustments,  consisting  only of normal
recurring  adjustments  necessary for a fair presentation of the results for the
interim periods.  Certain information and footnote disclosures normally included
in  financial   statements   prepared  in  accordance  with  generally  accepted
accounting  principles have been condensed or omitted  pursuant to SEC rules and
regulations,  although the Company believes that the disclosures included herein
are adequate to make the information  presented not  misleading.  The results of
operations  for the  three  period  ended  March  31,  1999  is not  necessarily
indicative of the results expected for the full year.

The organization and business of the Company,  accounting  policies  followed by
the Company and other  information  are contained in the Company's  December 31,
1998 Form 10-K.  This quarterly  report should be read in  conjunction with such
annual report.


Note 3.           Investments

The Company's  investments  and  mortgage-backed  securities  are  classified as
available  for sale and recorded at fair value as required by the  provisions of
Statement of Financial Accounting Standards No. 115. Unrealized gains and losses
are  reflected  as  a  separate   component  of  shareholders'   equity  on  the
consolidated statement of condition.  At March 31, 1999, an unrealized loss, net
of tax, of $396,000 was reflected as a decrease of shareholders' equity.



                                     Page 4
<PAGE>
                       AMERICAN BANCSHARES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS



Note 4.           Earnings Per Share

  Basic  earnings per common share is  calculated  by dividing net income by the
sum of the weighted average number of shares of common stock outstanding.

  Diluted  earnings per common share is calculated by dividing net income by the
weighted  average  number of shares of common  stock  outstanding,  assuming the
exercise of stock options and warrants  using the treasury  stock  method.  Such
adjustments to the weighted average number of shares of common stock outstanding
are made only when such  adjustments  dilute  earnings  per  common  share.  The
diluted earnings per share is summarized as follows:
<TABLE>
<CAPTION>
                                                             Three Months     
                                                            ended March 31,    
                                                           1999        1998  
                                                        ---------   ---------
<S>                                                     <C>         <C>      
Weighted average common shares outstanding............  5,010,291   4,994.484
Weighted average common shares equivalents............     10,694      28,958
                                                        ---------   ---------
Shares used in diluted earnings per share
  calculation.........................................  5,020,985   5,023,442
                                                        =========   =========
</TABLE>


Note 5.           Comprehensive Income

Effective January 1, 1998 the Company has adopted Financial Accounting Standards
("FAS") No. 130 "Reporting  Comprehensive Income," which requires that all items
that are required to be recognized under  accounting  standards as components of
comprehensive income be reported in the financial statements. Prior periods will
be reclassified as required.  The Company's total comprehensive  earnings are as
follows:
<TABLE>
<CAPTION>
Comprehensive Earnings (unaudited, $ in thousands)

                                             Three months ended March 31,
                                               1999               1998
                                               ----               ---- 
<S>                                     <C>                 <C>
Net income (loss)                               403                404       
Other comprehensive earnings (losses):
Unrealized gains (losses) on securities        (253)               106
                                               -----              -----
Comprehensive income                            150                510
</TABLE>


Note 6.           Impact of Recently Issued Accounting Standards

Financial  Accounting  Standards Board Statement (FAS) No. 134,  "Accounting for
Mortgage-Backed  Securities  retained after the Securitization of Mortgage Loans
Held  for  Sale by a  Mortgage  Banking  Entity,"  amends  FAS No.  65  allowing
mortgage-backed   securities  or  other  retained  interests  arising  from  the
securitization  of mortgage loans to be classified based on the mortgage banking
entities' ability and intent to sell of hold those securities.  Previously these
securities  had to be held  within a  trading  account.  This  statement  became
effective this quarter and had no impact on the financial statements.

FAS No. 133,  "Accounting for Derivative  Instruments  and Hedging  Activities,"
requires all  derivatives  to be recorded on the balance sheet at fair value and
establishes  standard  accounting  methodologies  for  hedging  activities.  The
standard will result in the  recognition of offsetting  changes in value or cash
flows of both the hedge and the hedged item in earnings or comprehensive  income
in the same period.  The statement is effective  for the  Company's  fiscal year
ending  December  31,  2000.  Because the Company  does not  currently  hold any
derivative  investments,  the adoption of this statement is not expected to have
an impact on the financial statements.



                                     Page 5
<PAGE>
                       AMERICAN BANCSHARES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS



Note 7.           Subsequent Events

On April 27, 1999 the Bank  charged-off  $458,000 of bad debt that was part of a
loan relationship totaling approximately $1 million. Management is currently
reviewing the  remaining  balances to determine if  additional  charge-offs  are
warranted. Management  uses a procedure on a monthly basis for  evaluating  the
adequacy  of the  allowance  for  loan  loss.  Based on that  review  management
considers the allowance sufficient to cover expected loan losses.

Effective  April 30, 1999, Mr. Gerald L. Anthony  resigned his position as Chief
Executive  Officer  and  President  of the  Company,  pursuant to the terms of a
severance agreement. Under the terms of the severance agreement, the Company has
agreed  to  a  severance   package   providing  for  the  payment  of  $190,000.
Consequently  the Company has expensed the full amount of the severance  payment
in the second quarter.  The Company  anticipates  that second quarter 1999 after
tax  earnings  will be  reduced  by  approximately  $124,000  as a result of the
severance payment.



                                     Page 6
<PAGE>


PART 1

ITEM 2.

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

American Bancshares, Inc. and Subsidiaries

Forward Looking Statements

This  Quarterly  Report on Form 10-Q  (including the Exhibits  hereto)  contains
certain  "forward-looking  statements"  within the  meaning  of the safe  harbor
provisions  of the Private  Securities  Litigation  Reform Act of 1995,  such as
statements  relating  to,  among  other  things,  the  financial  condition  and
prospects,   results  of  operations,  plans  for  future  business  development
activities,  capital  spending and financing  sources,  capital  structure,  the
effects of regulation and competition,  year 2000 readiness, and the business of
the  Company  and  its  subsidiaries.  Where  used  in this  filing,  the  words
"anticipate",  "believe",  "estimate",  "expect",  "intend", "plan", and similar
words and expressions,  as they relate to the Company,  or the management of the
Company, identify forward-looking  statements.  Such forward-looking  statements
reflect the current views of the Company and are based on information  currently
available  to the  management  of the  Company  and upon  current  expectations,
estimates,  and  projections  about the Company and its  industry,  management's
beliefs with respect thereto, and certain assumptions made by management.  These
forward-looking  statements  are not  guarantees of future  performance  and are
subject to risks,  uncertainties,  and other  factors  which could cause  actual
results  to  differ   materially   from  those  expressed  or  implied  by  such
forward-looking  statements as a result of various factors.  Potential risks and
uncertainties  include,  but are not limited to: (i) competitive pressure in the
banking and financial services industries increasing significantly; (ii) changes
in the  interest  rate  environment  which  reduce  margins;  (iii)  changes  in
political  conditions  or changes  occurring in the  legislative  or  regulatory
environment;  (iv) general economic conditions, either nationally or regionally,
becoming  less  favorable  than expected  resulting  in, among other  things,  a
deterioration in credit quality;  (v) changes  occurring in business  conditions
and inflation;  (vi)  acquisitions  and  integration  of acquired  businesses or
assets;  (vii)  changes  in  technology;  (viii)  changes  in  monetary  and tax
policies;  (ix)  changes  occurring  in the  securities  markets;  (x) year 2000
related issues and (xi) other risks and uncertainties detailed from time to time
in the filings of the Company with the  Commission  including the report on Form
10-K for the year ended December 31, 1998.

Liquidity and Capital Resources

Total assets of the Company  increased by 7.75% to  $490,435,000 as of March 31,
1999, from  $455,164,000 as of December 31, 1998 and 29.3% from  $379,179,000 as
of March 31, 1998.  The increase in assets from December 31, 1998, was primarily
the result of increases in net loans of $30,943,000 to $367,909,000 and mortgage
backed  securities of $9,211,000  to  $37,966,000.  The increases in assets were
funded through  increases in deposits of $11,966,000 to $356,841,000,  increases
in Securities  Sold Under  Agreements to Repurchase of $1,657,000 to $31,249,000
and increases in borrowings of $20,610,000 to $55,510,000.

As of March 31, 1999, the Bank's Tier 1 leverage ratio was 8.19%, Tier 1 to risk
weighted assets was 11.19% and total risk based capital was 11.90%, resulting in
a classification of "Well Capitalized" under FDIC guidelines.  The Bank, through
its Asset/Liability Committee,  monitors, among other things, the Bank's capital
and liquidity  position,  making  adjustments  to deposit,  loan, and investment
strategies  as  necessary.  The Bank  continues to maintain  adequate  liquidity
levels with a liquidity ratio at March 31, 1999 of 41.23%.  The Bank is a member
of the Federal  Home Loan Bank of Atlanta  (FHLB).  FHLB has  approved a line of
credit totaling  $75,000,000  collateralized by qualifying  mortgages and all of
the Bank's FHLB stock. As of March 31, 1999, advances totaling  $55,510,000 were
outstanding.  The Bank also maintains  Federal Funds  Purchased  agreements with
several  correspondent  banks to provide sources of overnight funds. As of March
31, 1999, the Bank had no federal funds purchased.

Management  believes that there are adequate  funding sources to meet its future
liquidity needs for the foreseeable future.  Primary among these funding sources
are the  repayment  of  principal  and  interest  on loans,  the renewal of time
deposits,  and the growth in the deposit base.  Management does not believe that
the terms and  conditions  that will be present at the renewal of these  funding
sources  will  significantly  impact  the  Company's  operations,   due  to  its
management of the maturities of its assets and liabilities.



                                     Page 7
<PAGE>

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


PART 1.

ITEM 2. (continued)

Results of Operations

The  Company's  net income for the quarter  ended March 31, 1999 was $403,000 or
$.08 per share,  compared  to net income of  $404,000  or $.08 per share for the
same period for 1998. Net interest income  increased  $383,000 to $3,777,000 for
the quarter ended March 31, 1998,  over the same quarter in 1998, as a result of
the increase in interest  earning  assets.  Non-interest  income  increased from
$1,103,000  for the  quarter  ended March 31,  1998 to  $1,345,000  for the same
period in 1999. The increase in non-interest income is primarily attributable to
increases in service  charges and fees on deposits of  $189,000;  an increase in
gain on the sale of mortgage loans of $186,000 and credit card merchant services
fee  income  of  $87,000  partially  offset  by  decreases  in  gain  on sale of
securities of $112,000; other income of $61,000; broker loan fees of $32,000 and
$15,000 in gain on sale of servicing.

Total general and  administrative  expense for the quarter ended March 31, 1999,
increased  $626,000  over  the  same  period  of 1998.  This  increase  resulted
primarily from increases in other  operating  expenses  related to the growth in
the  Company's  assets,  the number of Bank  branches,  and the operation of the
Finance  Company. Specifically, salary  expense  increased by $458,000 and other
expense  increased by $172,000 primarily due to increased  telephone expenses of
$37,000 and increased stationery and supplies expenses of $49,000.

For the three months ended March 31,1999, net interest income increased $383,000
to  $3,777,000,  compared to $3,394,000 for the same period in 1998, as a result
of the 29% asset growth.  Loan loss  provision  increased  from $124,000 for the
three month period ended March 31, 1998 to $315,000 for the same period in 1999.
Management  uses a procedure on a monthly basis for  evaluating  the adequacy of
the  allowance  for loan loss.  Based on that review  management  considers  the
allowance sufficient to cover expected loan losses.

On April 27, 1999 the Bank  charged-off  $458,000 of bad debt that was part of a
loan relationship totaling approximately $1 million. Management is currently
reviewing the  remaining  balances to determine if  additional  charge-offs  are
warranted. 

Effective  April 30, 1999, Mr. Gerald L. Anthony  resigned his position as Chief
Executive  Officer  and  President  of the  Company,  pursuant to the terms of a
severance agreement. Under the terms of the severance agreement, the Company has
agreed  to  a  severance   package   providing  for  the  payment  of  $190,000.
Consequently  the Company has expensed the full amount of the severance  payment
in the second quarter.  The Company  anticipates  that second quarter 1999 after
tax  earnings  will be  reduced  by  approximately  $124,000  as a result of the
severance payment.



                                     Page 8
<PAGE>

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


PART 1.

ITEM 2.A   Year 2000 Compliance

Year 2000  issues  and state of  readiness:  The  Company is aware of the issues
associated with existing  computer-controlled  systems properly  recognizing and
processing  information  relating  to dates in and after the Year 2000.  Systems
that cannot adequately process dates beyond the year 1999 could generate
erroneous  data or cause a system to fail.  Because the Year 2000 issue poses an
unprecedented  enterprise  wide  challenge for every  organization,  the Company
formed a Year 2000 Committee ("Y2K  Committee").  The Y2K Committee  developed a
Year 2000 Project Plan ("Y2K Plan") which  addresses  both internal and external
technology. The data processing systems and software include those developed and
maintained by the Company's  third-party  data processing  vendors and purchased
software which is run on in-house computer networks.

In 1997  the  Company,  through  the  Y2K  Committee,  initiated  a  review  and
assessment  of all  hardware  and  software  to  confirm  that it will  function
properly  in the  Year  2000.  Each  system  was  evaluated  for its  degree  of
significance  to the  operations  of the  Company and  detailed  test plans were
developed for those systems determined to be of a critical nature.

Third-party data processing vendors  (primarily M&I Data Services,  Inc. for its
general ledger,  deposits,  and portfolio loans;  Essex Home Mortgage  Servicing
Corp. for its loans held for sale;  Compass Bank for its  investment  portfolio,
and Contour,  Inc. for its mortgage loan processing systems) have been contacted
and the Company has obtained  verification from these vendors that these systems
will function properly in the Year 2000.

With respect to purchased software and electronic  hardware devices currently in
use, the Company has inventoried these items to determine which of these devices
rely on a valid date in order to  function.  The  Company  has  contacted  those
vendors  identified  through  this  inventory,  who have  indicated  that  their
hardware and software is or will be Year 2000 compliant in time frames that meet
regulatory requirements.

Non-information  technology  embedded systems  consisting  primarily of security
systems, HVAC controls and elevators have also been reviewed. These systems were
found to be generally year 2000 compliant.

The Company also has  relationships  with  suppliers  and other  companies.  The
Company has contacted key  suppliers of goods or services  regarding  their Year
2000 readiness.  They are in the process of reviewing their systems. The Company
will continue to monitor these suppliers as to their Year 2000 readiness.

Risks  associated  with year 2000 and  contingency  plan:  Based on  information
currently  available  to  the  Company,  the  Company  believes  that  the  most
reasonably  likely  worst case Year 2000  scenario  with  respect to the Company
relate to the potential failure of third party data processing vendors to become
Year 2000 compliant.  The inability of these third party data processing vendors
to complete  their Year 2000  remediation  processes in a timely  fashion  could
result in delays in processing daily transactions and could result in a material
and  adverse  effect  on the  Company's  results  of  operations  and  financial
condition.  The Company has  developed a contingency  plan to address  potential
failures in these systems.  The Company believes that  modifications to existing
systems,  conversion  to new systems,  and vendor  compliance  upgrades  will be
resolved on a timely basis.

Expenses related to year 2000 compliance.  The Company's  current  assessment of
cost  associated  with  the  completion  of its Y2K  Plan is not  considered  by
management to be material to the Company's future operations.  Through March 31,
1999,  the  Company  has  expended  $37,000  on its  Y2K  Plan  and  anticipates
additional costs of approximately  $143,000, to be incurred in 1999. The cost of
completing the Company's Y2K Plan and the dates on which all procedures  will be
completed are based on management's best estimates. These estimates were derived
utilizing  various  assumptions  about future  events,  including  the continued
availability of resources,  external  technology,  modification  plans and other
significant  factors.  However,  there can be no guarantee that these  estimates
will be achieved and actual results could differ materially from those currently
anticipated.



                                     Page 9
<PAGE>

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


PART 1.

ITEM 3.    Quantitative and Qualitative Disclosure About Market Risk

MARKET RISK

One of the  Company's  primary  objectives  is to  control  fluctuations  in the
Economic Value of Equity ("EVE") caused by changes in interest rates. The Bank's
Asset/Liability Committee ("ALCO") is responsible for addressing fluctuations in
the EVE.  The ALCO  utilizes a model that takes into account and  evaluates  the
market risk of the Bank's financial  position.  Market risk represents  possible
risk of loss from  adverse  changes in market  prices and interest  rates.  ALCO
monitors the impact of changes in the interest  rates  through the use of an EVE
model.  EVE is the net  present  value of the  balance  sheet cash  flows.  This
measures a sudden  increase or  decrease  in  interest  rates in 100 basis point
increments and the effect of such change on the net present value of equity. The
following table sets forth the estimated impact of immediate changes in interest
rates as of March 31, 1999:



<TABLE>
<CAPTION>
             RATE CHANGE                  EVE                   % CHANGE
             -----------               ---------                --------

             <S>                       <C>                      <C> 
                - 400                  $  47,487                 - 8.58%
                - 300                     43,641                 - 9.79
                - 200                     41,095                 - 9.82
                - 100                     40,236                 - 6.33
                    0                     41,688                   0.00
                + 100                     43,647                   7.92
                + 200                     45,736                  15.66
                + 300                     47,902                  23.19
                + 400                     50,113                  30.50
</TABLE>

The preceding  table  indicates that at March 31, 1999, in the event of a sudden
and sustained increase in market rates the EVE would be expected to increase and
given a  decrease  in  market  rates  the EVE  would  be  expected  to  decrease
initially, for the first 200 basis point decline, then increase, for the next
200 basis point decline. These changes are the result of repricing opportunities
inherent in the balance sheet.  Computations  of forecasted  efforts of interest
rates are based on numerous  assumptions,  such as market interest  rates,  loan
growth and prepayment, deposit maturities and retention and should not be relied
upon as indicative of future  results.  Also, the  computations do not take into
effect any  actions  that the ALCO could  undertake  in  response  to changes in
interest rates.


                                     Page 10
<PAGE>


PART II - OTHER INFORMATION


Item 1.   Legal Proceedings

         Not applicable this filing.


Item 2.   Changes in Securities

         Not applicable this filing.


Item 3.   Defaults Upon Senior Securities

         Not applicable this filing.


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

         Not applicable this filing.
 

Item 5.   Other Information

         Not applicable this filing.


Item 6.   Exhibits and Reports on Form 8-K

(a)   Exhibits:

    none this period

(b)   Reports on Form 8-K

    On February 16, 1999 the Company filed a report on Form 8-K  announcing  the
resignation of Mr. Gerald L. Anthony as President and Chief Executive Officer of
American  Bank and the  appointment  of Mr.  Jerry Neff to serve as the  interim
President and Chief Executive Officer of the Bank.

    On March 12, 1999 the Company filed a report on Form 8-K announcing  that it
will  increase by $400,000  the  allowance  for loan losses of its wholly  owned
banking  subsidiary, American  Bank, to be charged  against the  Company's  1998
fiscal year end financial results.

    On May 5,  1999  the  Company  filed a  report on  Form 8-K  announcing  the
resignation of Mr. Gerald L. Anthony as Chief Executive Officer and President of
the  Company  pursuant  to  the  terms  of  a  Severance  Agreement  approved by
the Board of Directors of the Company,  which agreement  modifies and  clarifies
the terms of Mr. Anthony's  Employment Agreement as it relates to his separation
from the Company and its subsidiaries.



                                     Page 11
<PAGE>


SIGNATURES


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.




                                            /s/      Jerry L. Neff
                                            -----------------------------------
                                            Jerry L. Neff, President and
                                            Chief Executive Officer


                                            Date: May 13, 1999
                                                 -------------------


                                            /s/      Brian M. Watterson
                                            -----------------------------------
                                            Brian M. Watterson
                                            Senior Vice President and
                                            Chief Financial Officer


                                            Date: May 13, 1999
                                                 -------------------