SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



                                    FORM 10-Q

[X]          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

                         SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 1999

                                       OR

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

For the transition period from              to

Commission file number 0-20632


                                FIRST BANKS, INC.
                                -----------------
             (Exact name of registrant as specified in its charter)

            MISSOURI                                   43-1175538
            --------                                   ----------
 (State or other jurisdiction of                    (I.R.S. Employer
  incorporation or organization)                   Identification No.)

                   135 North Meramec, Clayton, Missouri 63105
                   ------------------------------------------
               (Address of principal executive offices) (Zip Code)

                                 (314) 854-4600
                                 --------------
              (Registrant's telephone number, including area code)

--------------------------------------------------------------------------------
(Former  name,  former  address,  and former  fiscal year, if changed since last
report)

         Indicate  by check  mark  whether  the  registrant:  (1) has  filed all
reports  required to be filed by Section 13 or 15(d) of the Securities  Exchange
Act of 1934 during the preceding 12 months (or for such shorter  period that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                                  Yes X No ____

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practicable date.

                                                    Outstanding at
               Class                               October 31, 1999
               -----                               ----------------

     Common Stock, $250.00 par value                     23,661



<PAGE>



                                FIRST BANKS, INC.
                                      INDEX

<TABLE>
<CAPTION>

                                                                                                        Page

PART I            FINANCIAL INFORMATION


<S>               <C>                                                                                   <C>
     Item 1.      Financial Statements (unaudited):
                  Consolidated Balance Sheets as of September 30, 1999
                      and December 31, 1998......................................................       -1-
                  Consolidated Statements of Income for the three and nine
                      months ended September 30, 1999 and 1998...................................       -3-
                  Consolidated Statements of Changes in Stockholders' Equity and
                      Comprehensive  Income for the nine months ended  September
                      30, 1999 and 1998 and the three months ended
                      December 31, 1998..........................................................       -4-
                  Consolidated Statements of Cash Flows for the nine months
                      ended September 30, 1999 and 1998..........................................       -5-
                  Notes to Consolidated Financial Statements.....................................       -6-

     Item 2.      Management's Discussion and Analysis of Financial
                    Condition and Results of Operations..........................................      -12-


PART II           OTHER INFORMATION

     Item 6.      Exhibits and Reports on Form 8-K...............................................      -26-

SIGNATURES.......................................................................................      -27-


</TABLE>







<PAGE>



                         PART I -- FINANCIAL INFORMATION
                          Item 1. Financial Statements

                                FIRST BANKS, INC.
                     Consolidated Balance Sheets (unaudited)
             (dollars expressed in thousands, except per share data)

<TABLE>
<CAPTION>



                                                                                September 30,     December 31,
                                                                                    1999              1998
                                                                                    ----              ----


                                 ASSETS
                                 ------

Cash and cash equivalents:
<S>                                                                             <C>                  <C>
   Cash and due from banks.................................................     $  115,808           174,329
   Interest-bearing deposits with other financial
    institutions with maturities of three months or less...................          1,746             3,733
   Federal funds sold......................................................         59,300            36,700
                                                                                ----------       -----------
         Total cash and cash equivalents...................................        176,854           214,762
                                                                                ----------       -----------

Investment securities:
   Trading, at fair value..................................................             --             3,425
   Available for sale, at fair value.......................................        413,192           509,695
   Held to maturity, at amortized cost (fair value of
     $21,411 and $22,568 at September 30, 1999 and
     December 31,1998, respectively).......................................         21,298            21,676
                                                                                ----------       -----------
         Total investment securities.......................................        434,490           534,796
                                                                                ----------       -----------

Loans:
   Commercial, financial and agricultural..................................      1,095,558           920,007
   Real estate construction and development................................        883,491           720,910
   Real estate mortgage....................................................      1,729,430         1,529,177
   Consumer and installment ...............................................        246,415           282,549
   Loans held for sale.....................................................         45,636           135,619
                                                                                ----------       -----------
         Total loans ......................................................      4,000,530         3,588,262
   Unearned discount.......................................................         (7,577)           (8,157)
   Allowance for possible loan losses......................................        (68,498)          (60,970)
                                                                                ----------       -----------
         Net loans.........................................................      3,924,455         3,519,135
                                                                                ----------       -----------

Bank premises and equipment, net of accumulated
   depreciation and amortization...........................................         74,908            63,848
Intangibles associated with the purchase of subsidiaries...................         47,579            36,534
Mortgage servicing rights, net of amortization.............................          9,124             9,825
Accrued interest receivable................................................         30,652            28,465
Other real estate..........................................................          1,407             3,709
Deferred income taxes......................................................         56,185            46,848
Other assets...............................................................         97,592            96,888
                                                                                ----------       -----------
         Total assets......................................................     $4,853,246         4,554,810
                                                                                ==========       ===========

</TABLE>





<PAGE>


                                FIRST BANKS, INC.
                     Consolidated Balance Sheets (unaudited)
             (dollars expressed in thousands, except per share data)
                                   (continued)
<TABLE>
<CAPTION>


                                                                                September 30,     December 31,
                                                                                    1999              1998
                                                                                    ----              ----


                               LIABILITIES
                               -----------

Deposits:
    Demand:
<S>                                                                             <C>                  <C>
       Non-interest-bearing................................................     $  608,652           561,383
       Interest-bearing....................................................        396,586           377,435
    Savings................................................................      1,228,724         1,198,567
    Time:
       Time deposits of $100 or more.......................................        307,403           219,996
       Other time deposits.................................................      1,676,669         1,582,604
                                                                                ----------       -----------
         Total deposits....................................................      4,218,034         3,939,985
Other borrowings...........................................................         96,260           121,331
Notes payable..............................................................         73,000            50,048
Accrued interest payable...................................................         10,182             5,817
Deferred income taxes......................................................          9,940            10,920
Accrued and other liabilities..............................................         20,709            20,652
Minority interest in subsidiary............................................         12,188            15,251
                                                                                ----------       -----------
         Total liabilities.................................................      4,440,313         4,164,004
                                                                                ----------       -----------

Guaranteed preferred beneficial interests in:
    First Banks, Inc. subordinated debenture...............................         83,367            83,288
    First Banks America, Inc. subordinated debenture.......................         44,202            44,155
                                                                                ----------       -----------
         Total guaranteed preferred beneficial interests in
           subordinated debentures.........................................        127,569           127,443
                                                                                ----------       -----------

                          STOCKHOLDERS' EQUITY
                          --------------------

Preferred stock:
    $1.00 par value, 5,000,000 shares authorized; no shares issued
       and outstanding at September 30, 1999 and December 31, 1998.........             --                --
    Class A convertible, adjustable rate, $20.00 par value; 750,000
       shares authorized; 641,082 shares issued and outstanding............         12,822            12,822
    Class B adjustable rate, $1.50 par value; 200,000 shares,
       authorized; 160,505 shares issued and outstanding...................            241               241
Common stock, $250.00 par value; 25,000 shares
    authorized; 23,661 shares issued and outstanding.......................          5,915             5,915
Capital surplus............................................................          2,979               780
Retained earnings..........................................................        259,195           231,867
Accumulated other comprehensive income.....................................          4,212            11,738
                                                                                ----------       -----------
         Total stockholders' equity........................................        285,364           263,363
                                                                                ----------       -----------
         Total liabilities and stockholders' equity........................     $4,853,246         4,554,810
                                                                                ==========       ===========

</TABLE>

The  accompanying  notes  are an  integral  part of the  consolidated  financial
statements.




<PAGE>


                                FIRST BANKS, INC.
                  Consolidated Statements of Income (unaudited)
             (dollars expressed in thousands, except per share data)


<TABLE>
<CAPTION>
                                                                                      Three months ended       Nine months ended
                                                                                         September 30,           September 30,
                                                                                      ------------------       -----------------
                                                                                      1999         1998       1999          1998
                                                                                      ----         ----       ----          ----

Interest income:
<S>                                                                                  <C>           <C>        <C>        <C>
     Interest and fees on loans....................................................  $ 81,919      73,239     235,558    209,409
     Investment securities.........................................................     6,347       9,966      20,454     31,676
     Federal funds sold and other..................................................       779         551       1,234      2,541
                                                                                     --------     -------    --------   --------
           Total interest income...................................................    89,045      83,756     257,246    243,626
                                                                                     --------     -------    --------   --------
Interest expense:
     Deposits:
       Interest-bearing demand.....................................................     1,269       1,141       3,565      3,944
       Savings.....................................................................    10,962      11,226      32,976     31,011
       Time deposits of $100 or more...............................................     2,986       2,883       8,452      9,258
       Other time deposits.........................................................    21,197      22,590      62,158     70,322
     Interest rate exchange agreements, net........................................     1,409         990       3,997      2,970
     Notes payable and other borrowings............................................     1,721       1,472       5,512      4,519
                                                                                     --------     -------    --------   --------
           Total interest expense..................................................    39,544      40,302     116,660    122,024
                                                                                     --------     -------    --------   --------
           Net interest income.....................................................    49,501      43,454     140,586    121,602
                                                                                     --------     -------    --------   --------
Provision for possible loan losses.................................................     2,880       2,275       8,743      6,225
                                                                                     --------     -------    --------   --------
           Net interest income after provision for possible loan losses............    46,621      41,179     131,843    115,377
                                                                                     --------     -------    --------   --------
Noninterest income:
     Service charges on deposit accounts and customer service fees.................     4,434       3,781      12,791     10,670
     Credit card fees..............................................................        35         695         362      2,307
     Loan servicing fees, net......................................................       113         177         396        880
     Gain on mortgage loans sold and held for sale.................................     1,605       1,758       5,439      3,659
     Net gain on sales of available-for-sale securities............................         1         559         793        815
     Net gain (loss) on sales of trading securities................................        --         (29)       (303)       615
     Other.........................................................................     2,833       2,059      12,661      6,205
                                                                                     --------     -------    --------   --------
           Total noninterest income................................................     9,021       9,000      32,139     25,151
                                                                                     --------     -------    --------   --------
Noninterest expense:
     Salaries and employee benefits................................................    15,560      14,627      45,631     41,897
     Occupancy, net of rental income...............................................     3,505       2,830       9,347      7,970
     Furniture and equipment.......................................................     2,179       1,755       6,178      5,381
     Federal Deposit Insurance Corporation premiums................................       223         360         880        977
     Postage, printing and supplies................................................     1,003       1,144       3,156      4,093
     Data processing fees..........................................................     4,658       3,737      13,881      9,691
     Legal, examination and professional fees......................................     1,700       1,716       4,942      4,046
     Credit card...................................................................       142         987         509      2,549
     Communications................................................................       660         741       1,923      2,233
     Advertising and business development..........................................     1,019       1,111       2,566      3,767
     (Gain) loss on sales of other real estate, net of expenses....................      (391)       (146)       (405)       515
     Guaranteed preferred debentures...............................................     3,014       2,786       9,042      6,828
     Other.........................................................................     4,243       4,458      12,600     13,255
                                                                                     --------     -------    --------   --------
           Total noninterest expense...............................................    37,515      36,106     110,250    103,202
                                                                                     --------     -------    --------   --------
           Income before provision for income taxes and minority interest in income
              of subsidiary........................................................    18,127      14,073      53,732     37,326
Provision for income taxes.........................................................     6,689       5,079      19,792     13,469
                                                                                     --------     -------    --------   --------
           Income before minority interest in income of subsidiary.................    11,438       8,994      33,940     23,857
Minority interest in income of subsidiary..........................................       416         407       1,088      1,028
                                                                                     --------     -------    --------   --------
           Net income..............................................................    11,022       8,587      32,852     22,829
Preferred stock dividends..........................................................       196         196         524        524
                                                                                     --------     -------    --------   --------
           Net income available to common stockholders.............................  $ 10,826       8,391      32,328     22,305
                                                                                     ========     =======    ========   ========
Earnings per share:
     Basic.........................................................................  $ 457.54      354.65    1,366.29     942.70
     Diluted.......................................................................    444.11      343.73    1,320.33     910.91
                                                                                     ========     =======    ========   ========
Weighted average shares of common stock outstanding................................    23,661      23,661      23,661     23,661
                                                                                     ========     =======    ========   ========

</TABLE>
The  accompanying  notes  are an  integral  part of the  consolidated  financial
statements.


<PAGE>


                                FIRST BANKS, INC.
           Consolidated Statements of Changes in Stockholders' Equity
             and Comprehensive Income (unaudited) Nine months ended
               September 30, 1999 and 1998 and three months ended
                                December 31, 1998
             (dollars expressed in thousands, except per share data)


<TABLE>
<CAPTION>


                                                                                                                    Accu-
                                                                Adjustable rate                                    mulated
                                                                preferred stock                                     other   Total
                                                                ----------------
                                                              Class A                            Compre-           compre- stock-
                                                              conver-           Common   Capital hensive Retained  hensiveholders'
                                                               tible  Class B    stock   surplus income  earnings  income  equity
                                                               -----  -------    -----   ------- ------  --------  ------  ------

<S>                            <C>                          <C>         <C>     <C>      <C>    <C>      <C>      <C>    <C>
Consolidated balances, January 1, 1998....................  $ 12,822    241     5,915    3,978           199,143  9,438  231,537
    Nine months ended September 30, 1998:
   Comprehensive income:
       Net income.........................................       --      --        --       --   22,829   22,829     --   22,829
       Other comprehensive income, net of tax  -
         Unrealized gains on securities, net of
           reclassification adjustment (1)................       --      --        --       --    3,061       --  3,061    3,061
                                                                                                -------
       Comprehensive income...............................                                       25,890
                                                                                                =======
   Class A preferred stock dividends, $0.80 per share.....       --      --        --       --              (513)    --     (513)
   Class B preferred stock dividends, $0.07 per share.....       --      --        --       --               (11)    --      (11)
   Effect of capital stock transactions of
       majority-owned subsidiary..........................       --      --        --   (2,546)               --     --   (2,546)
                                                            -------     ---     -----   ------          --------  ----- --------
Consolidated balances, September 30, 1998.................    12,822    241     5,915    1,432           221,448 12,499  254,357
Three  months ended December 31, 1998: Comprehensive income:
       Net income.........................................       --      --        --       --   10,681   10,681     --   10,681
       Other comprehensive income, net of tax  -
         Unrealized losses on securities, net of
           reclassification adjustment (1)................       --      --        --       --     (761)      --   (761)    (761)
                                                                                                -------
       Comprehensive income...............................                                        9,920
                                                                                                =======
   Class A preferred stock dividends, $0.40 per share.....       --      --        --       --              (256)    --     (256)
       Class B preferred stock dividends, $0.04 per share.       --      --        --       --                (6)    --       (6)
   Effect of capital stock transactions of
       majority-owned subsidiary..........................       --      --        --     (652)               --     --     (652)
                                                            -------     ---     -----   ------          --------  ----- --------
Consolidated balances, December 31, 1998..................    12,822    241     5,915      780           231,867 11,738  263,363
Nine months ended September 30, 1999: Comprehensive income:
       Net income.........................................       --      --        --       --   32,852   32,852     --   32,852
       Other comprehensive income, net of tax  -
         Unrealized losses on securities, net of
           reclassification adjustment (1) ...............       --      --        --       --   (7,526)      -- (7,526)  (7,526)
                                                                                                -------
           Comprehensive income...........................                                       25,326
                                                                                                =======
   Class A preferred stock dividends, $0.80 per share.....       --      --        --       --              (513)    --     (513)
   Class B preferred stock dividends, $0.07 per share.....       --      --        --       --               (11)    --      (11)
   Effect of capital stock transactions of
       majority-owned subsidiary..........................       --      --        --   (3,341)               --     --   (3,341)
   Reclassification of retained earnings..................       --      --        --    5,000            (5,000)    --       --
   Reduction of deferred tax valuation reserve............       --      --        --      540                --     --      540
                                                            -------     ---     -----   ------          --------  ----- --------
Consolidated balances, September 30, 1999.................  $12,822     241     5,915    2,979           259,195   4,212 285,364
                                                            =======     ====    =====   ======          ========  ====== =======

 (1) Disclosure of reclassification adjustment:

                                                                                         Nine months ended  Three months ended
                                                                                          September 30,        December 31,
                                                                                         -----------------  ------------------
                                                                                           1999    1998            1998
                                                                                           ----    ----            ----

     Unrealized (losses) gains arising during the period............................  $  (7,011)   3,591           (338)
     Less:  reclassification adjustment for gains included in net income............        515      530            423
                                                                                        -------   ------          -----
     Unrealized (losses) gains on securities........................................  $  (7,526)   3,061           (761)
                                                                                        =======   ======          =====
</TABLE>
The  accompanying  notes  are an  integral  part of the  consolidated  financial
statements.



<PAGE>


                                FIRST BANKS, INC.
                Consolidated Statements of Cash Flows (unaudited)
                        (dollars expressed in thousands)
<TABLE>
<CAPTION>

                                                                                        Nine months ended
                                                                                          September 30,
                                                                                     ----------------------
                                                                                     1999              1998
                                                                                     ----              ----
Cash flows from operating activities:
<S>                                                                              <C>                  <C>
     Net income.............................................................     $  32,852            22,829
     Adjustments to reconcile net income to net cash provided
       by (used in) operating activities:
         Depreciation and amortization of bank premises
           and equipment....................................................         5,375             3,835
         Amortization, net of accretion.....................................         9,529             7,851
         Originations and purchases of loans held for sale..................      (378,045)         (391,414)
         Proceeds from the sale of loans held for sale......................       437,397           348,425
         Provision for possible loan losses.................................         8,743             6,225
         Provision for income taxes.........................................        19,792            13,469
         Payments of income taxes...........................................       (18,816)          (13,161)
         Increase in accrued interest receivable ...........................          (326)             (825)
         Net decrease (increase) in trading securities......................         3,425              (772)
         Interest accrued on liabilities....................................       116,660           122,045
         Payments of interest on liabilities................................      (113,634)         (123,563)
         Gain on sales of branch deposits...................................        (4,474)               --
         Gain on mortgage loans sold and held for sale......................        (5,439)           (3,659)
         Net gain on sales of available-for-sale securities.................          (793)             (815)
         Other operating activities, net....................................        (1,494)          (13,413)
         Minority interest in income of subsidiary..........................         1,088             1,028
                                                                                 ---------         ---------
              Net cash provided by (used in) operating activities...........       111,840           (21,915)
                                                                                 ---------         ---------
Cash flows from investing activities:
     Cash (paid) received for acquired entities, net of cash and cash
       equivalents received (paid)..........................................       (15,961)           29,339
     Proceeds from sales of investment securities available for sale........        64,640           104,273
     Maturities of investment securities available for sale.................       230,315           271,571
     Maturities of investment securities held to maturity...................         2,330             1,699
     Purchases of investment securities available for sale..................      (148,230)         (160,102)
     Purchases of investment securities held to maturity....................        (1,982)           (3,124)
     Net increase in loans..................................................      (259,737)         (327,896)
     Recoveries of loans previously charged-off ............................         6,931             6,656
     Purchases of bank premises and equipment...............................       (13,561)           (9,984)
     Other investing activities.............................................          (695)           (3,612)
                                                                                 ----------        ---------
              Net cash used in investing activities.........................      (135,950)          (91,180)
                                                                                 ---------         ---------
Cash flows from financing activities:
     (Decrease) increase in demand and savings deposits.....................       (58,424)          147,845
     Increase (decrease) in time deposits...................................        96,248          (133,516)
     Decrease in Federal Home Loan Bank advances............................       (25,000)           (1,514)
     (Decrease) increase in securities sold under agreements to repurchase..           (71)           13,979
     Increase in notes payable..............................................        22,952            17,264
     Proceeds from issuance of guaranteed preferred subordinated
       debenture............................................................            --            44,124
     Payment of preferred stock dividends...................................          (524)             (524)
     Sales of branch deposits...............................................       (48,979)               --
                                                                                 ---------         ---------
              Net cash (used in) provided by financing activities ..........       (13,798)           87,658
                                                                                 ---------         ---------
              Net decrease in cash and cash equivalents ....................       (37,908)          (25,437)
Cash and cash equivalents, beginning of period .............................       214,762           168,480
                                                                                 ---------         ---------
Cash and cash equivalents, end of period....................................     $ 176,854           143,043
                                                                                 =========         =========

Noncash investing and financing activities:
     Loans held for sale transferred to loans...............................     $  21,831                --
     Loans held for sale transferred to available-for-sale
       investment securities................................................         4,065                --
     Loans transferred to other real estate.................................         2,549             2,391
     Loans transferred to investment securities available for sale..........            --            65,361
                                                                                 =========         =========
</TABLE>
The  accompanying  notes  are an  integral  part of the  consolidated  financial
statements.


<PAGE>


                                FIRST BANKS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(1)      Basis of Presentation

         The accompanying consolidated financial statements of First Banks, Inc.
and  subsidiaries  (First Banks or the Company) are unaudited and should be read
in conjunction with the consolidated  financial statements contained in the 1998
annual  report on Form 10-K.  In the  opinion of  management,  all  adjustments,
consisting  of  normal  recurring  accruals  considered  necessary  for  a  fair
presentation  of the results of  operations  for the interim  periods  presented
herein,  have been included.  Operating  results for the nine month period ended
September  30, 1999 are not  necessarily  indicative  of the results that may be
expected for any other interim period or for the year ending December 31, 1999.

         The  consolidated  financial  statements  include the accounts of First
Banks,  Inc. and its  subsidiaries,  net of minority  interest.  All significant
intercompany   accounts  and   transactions   have  been   eliminated.   Certain
reclassifications  of 1998  amounts  have  been  made to  conform  with the 1999
presentation.

         First Banks operates through its subsidiary bank holding  companies and
financial  institutions  (collectively  referred to as the Subsidiary  Banks) as
follows:

      First Bank, headquartered in St. Louis County, Missouri (First Bank)
      First Bank & Trust, headquartered in Newport Beach, California (FB&T)
      Century Bank, headquartered in Beverly Hills, California (Century Bank)
      First Banks America, Inc., headquartered in St.Louis County, Missouri
          (FBA), and its wholly owned subsidiaries:
               First Bank Texas N.A.,  headquartered in Houston,  Texas (FB
               Texas) First Bank of California, headquartered in Roseville,
               California (FB California)  Redwood Bank,  headquartered  in
               San Francisco, California (Redwood Bank)

         The  Subsidiary  Banks  are  wholly  owned by their  respective  parent
companies  except FBA,  which was 76.84%  owned by First  Banks at December  31,
1998. On February 17, 1999, First Banks completed its purchase of 314,848 shares
of FBA common stock, pursuant to a tender offer to purchase up to 400,000 shares
of FBA common stock. This tender offer increased First Banks' ownership interest
in FBA to 82.34% of the outstanding  voting stock of FBA. At September 30, 1999,
First Banks' ownership interest in FBA was 82.67%.

(2)      Acquisitions and Divestitures

         On March 4, 1999,  FBA completed  its  acquisition  of Redwood  Bancorp
(Redwood) and its wholly owned subsidiary,  Redwood Bank, for cash consideration
of $26.0 million.  Redwood is  headquartered  in San  Francisco,  California and
operates  four banking  locations  in the San  Francisco  Bay area.  Redwood had
$183.9  million  in total  assets,  $134.4  million  in loans,  net of  unearned
discount,  $32.4 million in investment securities and $162.9 million in deposits
at the acquisition date. The transaction was funded from available proceeds from
the sale of the 8.50% Guaranteed  Preferred  Beneficial  Interest in First Banks
America, Inc.  Subordinated  Debenture completed in July 1998. The excess of the
cost over the fair  value of the net assets  acquired  was $9.5  million  and is
being amortized over 15 years.

         On August 31, 1999,  First Banks  completed its  acquisition of Century
Bank for cash consideration of $31.5 million. Century Bank is located in Beverly
Hills,  California and operates  commercial banking facilities in Beverly Hills,
Los Angeles, Santa Monica, Marina del Rey, Encino and San Francisco, California.
At the acquisition date, Century Bank had total assets of $156.0 million,  total
loans, net of unearned discount,  of $94.8 million,  total investment securities
of $26.1  million and total  deposits of $132.0  million.  The  transaction  was
funded from borrowings  under First Banks' $100 million credit  agreement with a
group of unaffiliated  financial  institutions.  The excess of the cost over the
fair value of the net assets  acquired  was  approximately  $4.5  million and is
being amortized over 15 years.
<PAGE>

         On September 17, 1999,  FB&T  completed its  assumption of the deposits
and certain  liabilities  and the  purchase  of  selected  assets of the Malibu,
California  branch  office of  Brentwood  Bank of  California.  The  transaction
resulted in the acquisition of  approximately  $17.3 million of deposits and one
branch office that operates as a branch of FB&T. The excess of the cost over the
fair value of the net assets  acquired was $325,000 and is being  amortized over
15 years.

         The  aforementioned  transactions were accounted for using the purchase
method of accounting and,  accordingly,  the consolidated  financial  statements
include  the  financial  position  and  results  of  operations  for the  period
subsequent to the  respective  acquisition  dates,  and the assets  acquired and
liabilities assumed were recorded at fair value at the acquisition dates. Due to
the immaterial effect on previously  reported  financial  information,  proforma
disclosures have not been prepared for the aforementioned transactions.

         On October 8, 1999,  FBA and Lippo Bank entered  into an Agreement  and
Plan of  Reorganization  providing  for  the  acquisition  of  Lippo  Bank,  San
Francisco,  California. Under the agreement, FBA will purchase all of the issued
and outstanding  capital stock of Lippo Bank for an estimated  purchase price of
$17.2 million. Lippo Bank operates three banking locations in San Francisco, San
Jose and Los Angeles,  California.  At September 30, 1999,  Lippo Bank had $90.2
million in total assets, $46.0 million in loans, net of unearned discount, $33.9
million  in  investment  securities  and $80.1  million in total  deposits.  The
transaction,   which  has  received  the  approval  of  Lippo  Bank's   majority
shareholder and is subject to regulatory approvals,  is expected to be completed
during the first quarter of 2000.

         In March and April 1999,  First Bank completed its divestiture of seven
branch  facilities in the northern and central Illinois market areas,  resulting
in a reduction of the deposit base of approximately  $54.8 million and a pre-tax
gain of $4.4 million  recorded in other income.  In September  1999,  First Bank
entered into a Branch  Purchase  and  Assumption  Agreement  for the sale of one
branch  facility  in central  Illinois.  This  transaction,  which is subject to
regulatory approvals, is expected to close during the first quarter of 2000.

 (3)     Regulatory Capital

         First Banks and the Subsidiary Banks are subject to various  regulatory
capital  requirements  administered  by the federal and state banking  agencies.
Failure to meet minimum capital  requirements can initiate certain mandatory and
possibly  additional  discretionary  actions by regulators  that, if undertaken,
could have a direct  material  effect on First Banks' and the Subsidiary  Banks'
financial  statements.  Under capital  adequacy  guidelines  and the  regulatory
framework for Prompt Corrective  Action, the Subsidiary Banks must meet specific
capital guidelines that involve  quantitative  measures of the Subsidiary Banks'
assets,  liabilities  and certain  off-balance-sheet  items as calculated  under
regulatory  accounting  practices.  Capital amounts and  classification are also
subject to  qualitative  judgments  by the  regulators  about  components,  risk
weightings and other factors.

         Quantitative  measures  established  by  regulations  to ensure capital
adequacy  require  First  Banks and the  Subsidiary  Banks to  maintain  certain
minimum ratios.  First Banks and the Subsidiary Banks are required to maintain a
minimum risk-based capital to risk-weighted assets ratio of 8.00%, with at least
4.00% being "Tier 1" capital (as defined in the  regulations).  In  addition,  a
minimum  leverage  ratio  (Tier 1 capital  to  average  assets) of 3.00% plus an
additional  cushion  of 100 to 200  basis  points  is  expected.  In order to be
considered  well  capitalized  under  Prompt  Corrective  Action  provisions,  a
financial  institution is required to maintain a risk-weighted asset ratio of at
least  10.00%,  a Tier 1  risk-weighted  asset  ratio  of at least  6.00%  and a
leverage  ratio of at least 5.00%.  As of March 31,  1999,  the date of the most
recent  notification from First Banks' primary  regulator,  the Subsidiary Banks
were categorized as well capitalized  under the regulatory  framework for Prompt
Corrective Action. Management believes, as of September 30, 1999, the Subsidiary
Banks, with the exception of FB&T, were each well capitalized.  During September
1999, FB&T  experienced an unusually high level of loan growth and, as a result,
fell below the minimum capital level required to be considered well  capitalized
under the Prompt Corrective  Action  provisions.  However,  at October 31, 1999,
FB&T's capital ratio returned to the well-capitalized  level as a result of loan
payoffs  and a $3.0  million  capital  infusion  from  First  Banks.  Management
considers  the decline in FB&T's  capital  level at  September  30, 1999 to be a
temporary  situation  and does not foresee any future  events that would prevent
FB&T from remaining well capitalized.
<PAGE>

         At  September  30, 1999 and  December  31,  1998,  First Banks' and the
Subsidiary Banks' capital ratios were as follows:
<TABLE>
<CAPTION>

                                                      Risk based capital ratios
                                              ---------------------------------------
                                                   Total                     Tier 1                Leverage ratio
                                                   -----                     ------                --------------
                                              1999       1998           1999      1998              1999    1998
                                              ----       ----           ----      ----              ----    ----

<S>                                           <C>       <C>             <C>       <C>              <C>      <C>
         First Banks......................    9.94%     10.27%          7.77%     7.87%            7.05%    6.78%
         First Bank.......................   10.51      10.01           9.25      8.75             8.01     7.46
         FB&T.............................    9.76      10.39           8.50      9.13             8.07     7.60
         Century Bank (1).................   21.86        --           20.60       --             14.37       -
         FB Texas.........................   12.41      11.37          11.15     10.11            10.06     9.15
         FB California....................   11.41      10.63          10.15      9.37             9.48     8.34
         Redwood Bank (2).................   10.94        --           10.06       --              9.55      --

         ----------------
         (1)      Century Bank was acquired by First Banks on August 31, 1999.
         (2)      Redwood Bank was acquired by FBA on March 4, 1999.
</TABLE>

 (4)     Earnings Per Common Share

         The following is a reconciliation of the numerators and denominators of
the basic and  diluted  earnings  per share (EPS)  computations  for the periods
indicated:
<TABLE>
<CAPTION>

                                                                          Income            Shares              Per share
                                                                        (numerator)      (denominator)           amount
                                                                        -----------      -------------           ------
                                                                   (dollars expressed  in thousands, except per share data)

   Three months ended September 30, 1999:
<S>                                                                    <C>                    <C>             <C>
     Basic EPS - income available to common stockholders..........     $    10,826            23,661          $     457.54
                                                                                                              ============
     Effect of dilutive securities:
       Class A convertible preferred stock........................             192             1,149
                                                                       -----------        ----------
     Diluted EPS - income available to common stockholders........     $    11,018            24,810          $     444.11
                                                                       ===========        ==========          ============

   Three months ended September 30, 1998:
     Basic EPS - income available to common stockholders..........     $     8,391            23,661          $     354.65
                                                                                                              ============
     Effect of dilutive securities:
       Class A convertible preferred stock........................             193             1,311
                                                                       -----------        ----------
     Diluted EPS - income available to common stockholders........     $     8,584            24,972          $     343.73
                                                                       ===========        ==========          ============

   Nine months ended September 30, 1999:
     Basic EPS - income available to common stockholders..........     $    32,329            23,661          $   1,366.29
                                                                                                              ============
     Effect of dilutive securities:
       Class A convertible preferred stock........................             512             1,212
                                                                       -----------        ----------
     Diluted EPS - income available to common stockholders........     $    32,841            24,873          $   1,320.33
                                                                       ===========        ==========          ============

   Nine months ended September 30, 1998:
     Basic EPS - income available to common stockholders..........     $    22,305            23,661          $     942.70
                                                                                                              ============
     Effect of dilutive securities:
       Class A convertible preferred stock........................             513             1,389
                                                                       -----------        ----------
     Diluted EPS - income available to common stockholders........     $    22,818            25,050          $     910.91
                                                                       ===========        ==========          ============
</TABLE>



<PAGE>


(5)      Business Segment Results

         First Banks' business  segments are First Bank, FB California,  Redwood
Bank, FB Texas, FB&T, Century Bank and First Bank Mortgage (FBM). The reportable
business  segments are consistent  with the management  structure of First Banks
and the internal reporting system that monitors performance.

         Through the  respective  branch  networks,  First Bank, FB  California,
Redwood  Bank,  FB Texas,  FB&T and Century  Bank provide  similar  products and
services in four defined  geographic  areas.  The products and services  offered
include a broad range of commercial  and personal  banking  services,  including
certificates of deposit,  individual retirement and other time deposit accounts,
checking and other demand deposit accounts,  interest checking accounts, savings
accounts and money market  accounts.  Loans  include  commercial,  financial and
agricultural,   real  estate   construction  and  development,   commercial  and
residential real estate,  consumer and  installment,  student and Small Business
Administration loans. Other financial services include mortgage banking,  credit
and debit cards, brokerage services,  credit-related insurance, automatic teller
machines,  telephone  account  access,  safe  deposit  boxes,  trust and private
banking services and cash management  services.  The revenues  generated by each
business segment consist  primarily of interest income,  generated from the loan
and investment security portfolios, and service charges and fees, generated from
the deposit  products and services.  The geographic  areas include  Missouri and
Illinois (First Bank),  southern  California  (FB&T and Century Bank),  northern
California  (FB  California  and Redwood Bank) and Houston,  Dallas,  Irving and
McKinney,  Texas (FB Texas).  The products and services are offered to customers
primarily within their respective  geographic  areas, with the exception of loan
participations  executed between these operating  segments of First Banks. There
are no foreign operations.

         FBM conducts  the  mortgage  banking  activities  of First  Banks.  The
mortgage banking activities consist primarily of the origination and purchase of
conforming and nonconforming  residential real estate loans, which are generally
sold into the  secondary  market.  The  related  mortgage  servicing  rights are
generally maintained for conforming loans while the nonconforming loans are sold
on a servicing  released basis. FBM's revenues include the interest earned while
loans are held pending sale,  net gains on the sale of loans,  and mortgage loan
servicing  fees earned  from its loan  servicing  portfolio.  The  products  and
services are offered to customers  primarily within First Banks' four geographic
areas. FBM also services certain residential real estate loans for FB California
for which it receives loan servicing fees.

         The  business  segment  results  are  summarized  as  follows  and  are
consistent  with First  Banks'  internal  reporting  system and, in all material
respects,   with  generally   accepted   accounting   principles  and  practices
predominant in the banking and mortgage  banking  industries.  The balance sheet
information is presented as of September 30, 1999 and December 31, 1998, and the
statement of income information is presented for the three and nine months ended
September 30, 1999 and 1998, respectively.  The business segment results include
Redwood  Bank,  which was  acquired by FBA on March 4, 1999,  and Century  Bank,
which was acquired by First Banks on August 31, 1999, for the periods subsequent
to the respective acquisition dates.


<PAGE>
<TABLE>
<CAPTION>
                                             First Bank           FB California          Redwood Bank (1)          FB Texas
                                       ---------------------  ---------------------    -------------------    -------------------
                                       Sept. 30,     Dec 31,   Sept 30,     Dec. 31,    Sept. 30,   Dec. 31,  Sept.30     Dec. 31,
                                         1999         1998       1999         1998        1999        1998      1999        1998
                                         ----         ----       ----         ----        ----        ----      ----        ----
                                                                    (dollars expressed in thousands)

Balance sheet information:

<S>                                    <C>            <C>          <C>       <C>          <C>          <C>    <C>         <C>
Investment securities................. $  200,192     252,165      24,573     53,449       33,582         --    31,797     59,914
Loans, net of unearned discount.......  2,478,054   2,354,937     346,685    314,977      145,767         --   221,103    201,426
Total assets..........................  2,892,983   2,869,648     422,458    410,110      195,791         --   277,572    300,984
Deposits..............................  2,629,689   2,623,157     373,322    363,422      168,162         --   238,714    264,425
Stockholders' equity.................. $  253,489     236,010      45,568     42,825       26,413         --    29,926     30,249
                                       ==========   =========     =======   ========    =========      =====  ========   ========


                                              First Bank              FB California        Redwood Bank (1)         FB Texas
                                          ------------------       ------------------     -----------------    ------------------
                                          Three months ended       Three months ended     Three months ended   Three months ended
                                             September 30,            September 30,         September 30,         September 30,
                                          ------------------       -----------------      -----------------     -----------------
                                          1999          1998        1999        1998        1999        1998     1999       1998
                                          ----          ----        ----        ----        ----        ----     ----       ----
                                                                        (dollars expressed in thousands)
Income statement information:


Interest income.......................  $  54,146      53,754       8,582      8,472         3,866        --     5,500      5,706
Interest expense......................     25,292      26,813       3,050      3,314         1,447        --     2,185      2,337
                                         --------    --------     -------     ------         -----      ----     ------     -----
   Net interest income................     28,854      26,941       5,532      5,158        2,419                3,315      3,369
Provision for possible loan losses....      1,950       1,900          15        150           60         --        15         75
                                         --------    --------     -------     ------         ----      -----    ------     ------
   Net interest income after provision
     for possible loan losses.........     26,904      25,041       5,517      5,008         2,359        --     3,300      3,294
                                         --------    --------     -------     ------         -----     -----    ------     ------
Noninterest income (2)................      5,360       4,002         934        836          122         --       504        590
Noninterest expense (3)...............     18,055      18,899       3,785      3,918         1,496        --     2,367      2,119
                                         --------   ---------     -------     ------         -----     -----    ------     ------
   Income before provision for income.
     taxes and minority interest in
     income of subsidiary.............     14,209      10,144       2,666      1,926          985         --     1,437      1,765
Provision for income taxes............      4,879       3,409       1,089        928          443         --       492        598
                                         --------   ---------     -------     ------         ----      -----    ------     ------
   Income before minority interest
     in income of subsidiary..........      9,330       6,735       1,577        998          542         --       945      1,167
Minority interest in income of                 --          --          --         --           --         --        --         --
   subsidiary                            --------   ---------      ------     ------         ----      -----       -----     ----
   Net income..........................  $  9,330       6,735       1,577        998          542         --       945      1,167
                                         ========   =========     =======     ======         ====      =====    ======     ======


                                              First Bank              FB California        Redwood Bank (1)         FB Texas
                                           -----------------        -----------------      ----------------     -----------------
                                           Nine months ended        Nine months ended      Nine months ended    Nine months ended
                                             September 30,            September 30,         September 30,         September 30,
                                          ------------------        ----------------       -----------------    ----------------
                                          1999          1998        1999        1998        1999        1998     1999       1998
                                          ----          ----        ----        ----        ----        ----     ----       ----
                                                                        (dollars expressed in thousands)
Income statement information:

Interest income....................... $  158,300     158,739      24,714     24,346        8,796         --    16,523     16,229
Interest expense......................     74,970      80,691       9,125     10,066        3,282         --     6,510      6,569
                                       ----------    --------     -------     ------        -----      -----    ------     ------
   Net interest income................     83,330      78,048      15,589     14,280        5,514         --    10,013      9,660
Provision for possible loan losses....      6,650       5,000          95        450          133         --        75        275
                                       ----------    --------     -------     ------         ----      -----    ------     ------
   Net interest income after provision
     for possible loan losses.........     76,680      73,048      15,494     13,830        5,381         --     9,938      9,385
                                       ----------    --------     -------     ------        -----      -----    ------     ------
Noninterest income (2)................     19,776      14,026       2,358      2,165          325         --     1,560      1,342
Noninterest expense (3)...............     51,890      54,626      11,410     11,725        3,403         --     6,877      6,507
                                       ----------   ---------     -------     ------        -----      -----    ------     ------
   Income before provision for income
     taxes and minority interest in
     income of subsidiary.............     44,566      32,448       6,442      4,270        2,303         --     4,621      4,220
Provision for income taxes............     15,035      10,947       2,742      1,895        1,087         --     1,588      1,452
                                       ----------   ---------     -------     ------        -----      -----    ------     ------
   Income before minority interest....
     in income of subsidiary..........     29,531      21,501       3,700      2,375        1,216         --     3,033      2,768
Minority interest in income of                 --          --          --         --           --         --        --         --
   subsidiary                           ---------     -------      ------     ------        -----      -----     -----     ------
   Net income......................... $   29,531      21,501       3,700      2,375        1,216         --     3,033      2,768
                                       ==========   =========     =======     ======        =====      =====    ======     ======
-----------------

(1)  Redwood Bank was acquired by FBA on March 4, 1999.
(2)  FBM includes  intercompany loan servicing fees of $146,000 and $473,000 for
     the three and nine months  ended  September  30,  1999,  respectively,  and
     $234,000 and $830,000 for the comparable periods in 1998.
(3)  Corporate  and other  includes  $2.0 million and $5.9 million of guaranteed
     preferred  debenture  expense,  after applicable income tax benefit of $1.0
     million and $3.1 million, for the three and nine months ended September 30,
     1999,  respectively,  and $1.8  million  and  $4.4  million  of  guaranteed
     preferred  debenture  expense,  after  applicable  income  tax  benefit  of
     $975,000 and $2.4 million, for the comparable periods in 1998.
(4)  Century Bank was acquired by First Banks on August 31, 1999.
</TABLE>


<PAGE>

<TABLE>
<CAPTION>

                                                                                Corporate, other
                                                                                and intercompany
   Century Bank (4)                FB&T                      FBM                reclassifications         Consolidated totals
------------------------ -------------------------  -------------------------  -----------------         --------------------
Sept. 30,      Dec.31,    Sept. 30,  Dec. 31,       Sept. 30,     Dec. 31,     Sept. 30,   Dec. 31,      Sept. 30,   Dec. 31,
    1999        1998       1999        1998            1999         1998         1999        1998          1999       1998
                                                    (dollars expressed in thousands)

<S>                       <C>       <C>              <C>           <C>           <C>        <C>           <C>          <C>
   25,010         --      84,870    134,203          15,656        12,199        8,810      22,866          434,490      534,796
   93,662         --     650,501    573,562          57,592       135,619         (411)       (416)       3,992,953    3,580,105
  170,290         --     806,345    793,217          84,502       154,952        3,305      25,899        4,853,246    4,554,810
  135,693         --     673,394    701,406          20,500        35,873      (21,440)    (48,298)       4,218,034    3,939,985
   31,773         --      73,478     75,165           4,360         7,663      179,643)   (128,549)         285,364      263,363
=========   ========     =======   ========        ========     =========      ========   ========        =========    =========
</TABLE>
<TABLE>
<CAPTION>
                                                                                Corporate, other
                                                                                and intercompany
 Century Bank (4)                 FB&T                      FBM                 reclassifications       Consolidated totals
------------------         ------------------       ------------------          -----------------       -------------------
Three months ended         Three months ended       Three months ended         Three months ended        Three months ended
   September 30,              September 30,            September 30,              September 30,             September 30,
------------------         -----------------        ------------------         ------------------         -----------------
  1999      1998           1999        1998          1999       1998            1999       1998           1999       1998
                                                    (dollars expressed in thousands)

<S>                        <C>        <C>              <C>        <C>            <C>        <C>          <C>       <C>
  1,075         --         14,691     14,103           1,300      1,925          (115)      (204)         89,045     83,756
    357         --          5,874      6,343             844      1,302           495        193          39,544     40,302
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------
    718         --          8,817      7,760             456        623          (610)      (397)         49,501     43,454
     40         --            800        150              --         --            --         --           2,880      2,275
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------

    678         --          8,017      7,610             456        623          (610)      (397)         46,621     41,179
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------
     66         --          1,037        999           1,600      2,199          (602)       374           9,021      9,000
    467         --          6,644      5,642           2,069      2,166         2,632      3,362          37,515     36,106
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------


    277         --          2,410      2,967             (13)       656        (3,844)    (3,385)         18,127     14,073
    123         --            957      1,191              (5)       230        (1,289)    (1,277)          6,689      5,079
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------

    154         --          1,453      1,776              (8)       426        (2,555)    (2,108)         11,438      8,994
     --         --             --         --              --         --           416        407             416        407
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------
    154         --          1,453      1,776              (8)       426        (2,971)    (2,515)         11,022      8,587
=======   ========       ========   ========       =========  =========      ========   ========        ========   ========


                                                                                Corporate, other
                                                                                and intercompany
 Century Bank (4)                 FB&T                      FBM                 reclassifications         Consolidated totals
------------------       -------------------       --------------------      -----------------------     --------------------
 Nine months ended         Nine months ended         Nine months ended          Nine months ended         Nine months ended
   September 30,              September 30,            September 30,              September 30,             September 30,
  1999      1998           1999        1998          1999       1998            1999       1998           1999       1998
                                              (dollars expressed in thousands)

  1,075         --         43,046     39,480           5,064      5,285          (272)      (453)        257,246    243,626
    357         --         17,863     19,310           3,342      3,595         1,211      1,793         116,660    122,024
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------
    718         --         25,183     20,170           1,722      1,690        (1,483)    (2,246)        140,586    121,602
     40         --          1,750        500              --         --            --         --           8,743      6,225
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------

    678         --         23,433     19,670           1,722      1,690        (1,483)    (2,246)        131,843    115,377
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------
     66         --          3,401      2,833           5,652      5,465          (999)      (680)         32,139     25,151
    467         --         19,869     16,084           6,356      5,428         9,978      8,832         110,250    103,202
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------


    277         --          6,965      6,419           1,018      1,727       (12,460)   (11,758)         53,732     37,326
    123         --          3,017      2,422             356        604        (4,156)    (3,851)         19,792     13,469
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------

    154         --          3,948      3,997             662      1,123        (8,304)    (7,907)         33,940     23,857
     --         --             --         --              --         --         1,088      1,028           1,088      1,028
-------   --------       --------   --------       ---------  ---------      --------   --------        --------   --------
    154         --          3,948      3,997             662      1,123        (9,392)    (8,935)         32,852     22,829
=======   ========       ========   ========       =========  =========      ========   ========        ========   ========
</TABLE>

<PAGE>


                 Item 2. Management's Discussion and Analysis of
                  Financial Condition and Results of Operations

         The  discussion  set forth in  Management's  Discussion and Analysis of
Financial  Condition and Results of Operations  contains certain forward looking
statements  with respect to the financial  condition,  results of operations and
business of First Banks. These forward looking statements are subject to certain
risks and  uncertainties,  not all of which  can be  predicted  or  anticipated.
Factors  that  may  cause  actual  results  to  differ   materially  from  those
contemplated by the forward looking  statements herein include market conditions
as well as  conditions  affecting  the banking  industry  generally  and factors
having  a  specific  impact  on  First  Banks,  including  but not  limited  to,
fluctuations  in  interest  rates  and in the  economy;  the  impact of laws and
regulations   applicable  to  First  Banks  and  changes  therein;   competitive
conditions  in the  markets  in  which  First  Banks  conducts  its  operations,
including  competition from banking and non-banking companies with substantially
greater resources than First Banks, some of which may offer and develop products
and  services  not  offered by First  Banks;  and the  ability of First Banks to
respond to changes in technology, including effects of the Year 2000 issue. With
regard to First Banks' efforts to grow through acquisitions,  factors that could
affect the accuracy or  completeness  of forward  looking  statements  contained
herein include the potential for higher than acceptable  operating costs arising
from the geographic  dispersion of the offices of First Banks,  as compared with
competitors  operating solely in contiguous  markets;  the competition of larger
acquirers with greater resources than First Banks, fluctuations in the prices at
which acquisition  targets may be available for sale and in the market for First
Banks'  securities;  and the potential for difficulty or unanticipated  costs in
realizing  the  benefits  of  particular  acquisition  transactions.  Additional
factors  potentially  affecting First Banks' results were identified in the 1998
Annual Report on Form 10-K filed with the Securities and Exchange Commission.

                                     General

         First Banks is a  registered  bank  holding  company,  incorporated  in
Missouri in 1978 and headquartered in St. Louis County,  Missouri.  At September
30, 1999,  First Banks had $4.9 billion in total  assets;  $4.0 billion in total
loans,  net of unearned  discount;  $4.2 billion in total  deposits;  and $285.4
million in total stockholders' equity.

         Through  the  Subsidiary  Banks,  First  Banks  offers a broad range of
commercial  and  personal  banking  services  including  certificate  of deposit
accounts,  individual  retirement and other time deposit accounts,  checking and
other demand deposit accounts,  interest checking accounts, savings accounts and
money market accounts.  Loans include  commercial,  financial and  agricultural,
real estate  construction  and  development,  commercial  and  residential  real
estate,  consumer and  installment,  student and Small  Business  Administration
loans.  Other financial  services  include  mortgage  banking,  credit and debit
cards, brokerage services,  credit-related insurance, automatic teller machines,
telephone account access, safe deposit boxes, trust and private banking services
and cash management services.

         The following table lists the Subsidiary Banks at September 30, 1999:
<TABLE>
<CAPTION>

                                             Number of                             Loans, net of          Total
               Subsidiary Banks              locations          Total assets     unearned discount      deposits
               ----------------              ---------          ------------     -----------------      --------
                                                                        (dollars expressed in thousands)

<S>                                             <C>             <C>                   <C>              <C>
First Bank..............................        87              $ 2,977,485           2,535,646        2,650,189
FB&T ...................................        22                  806,345             650,501          673,394
Century Bank............................         6                  170,290              93,662          135,693
FBA:
     FB California......................        10                  422,458             346,685          373,322
     FB Texas...........................         6                  277,572             221,103          238,714
     Redwood Bank.......................         4                  195,791             145,767          168,162

</TABLE>

<PAGE>


                               Financial Condition

         First Banks' total  assets  increased by $300 million to $4.85  billion
from $4.55 billion at September 30, 1999 and December 31, 1998, respectively. As
discussed in Note 2 to the accompanying  consolidated financial statements,  the
acquisitions  of Century Bank and Redwood  provided assets of $156.0 million and
$183.9  million,  respectively.  In  addition,  net loans,  excluding  the $94.8
million and $134.4  million of loans  acquired  from  Century  Bank and Redwood,
respectively,  increased $183.6 million, which is discussed under "--Lending and
Credit  Management" of this Form 10-Q.  Offsetting this increase was a reduction
in cash and due from banks  precipitated  by the  purchase  of Redwood and First
Banks' efforts to effectively  optimize  non-earning  assets, and a reduction in
investment  securities of $100.3 million,  which provided  additional sources of
funds for the loan growth.  Total deposits,  excluding the deposits  provided by
the acquisitions of Century Bank and Redwood,  decreased by $16.9 million.  This
decrease, while partially offset by internal deposit growth of $37.9 million, is
attributable  to the  divestiture  of  certain  branch  facilities  with a total
deposit base of $54.8  million.  In addition,  notes payable  increased to $73.0
million  at  September  30,  1999 from  $50.0  million  at  December  31,  1998,
reflecting  First Banks' funding source for the acquisition of Century Bank, net
of paydowns.

                              Results of Operations

Net Income

         Net income was $11.0 million,  or $444.11 per share on a diluted basis,
for the three months ended September 30, 1999, in comparison to $8.6 million, or
$343.73 per share on a diluted  basis,  for the  comparable  period in 1998. Net
income for the nine months ended  September  30, 1999 and 1998 was $32.9 million
and $22.8  million,  or  $1,320.33  and  $910.10  per share on a diluted  basis,
respectively. The earnings improvement is primarily attributable to First Banks'
efforts  to  realign  the  composition  of the loan  portfolio  through  further
diversification  and growth; the results of the acquisitions of Century Bank and
Redwood;  and the  divestiture  of  certain  branch  facilities.  As  previously
mentioned,  the loan growth was primarily funded through internal deposit growth
and reductions in cash and due from banks and investment securities.

         Net income was reduced by an  increased  provision  for  possible  loan
losses,  as  discussed  under  "--Provision  for Possible  Loan  Losses," and an
increase in  operating  expenses of $1.4  million and $7.0 million for the three
and nine months ended September 30, 1999 in comparison to the comparable periods
in 1998,  respectively.  The increased operating expenses are reflective of: the
additional  cost of the  preferred  securities  issued by FBA in July 1998;  the
continuing   expansion  of  commercial  and  retail  banking   activities;   the
acquisitions of Century Bank,  completed on August 31, 1999, Redwood,  completed
on March 4, 1999, Pacific Bay Bank,  completed on February 2, 1998, and Republic
Bank,  completed  on  September  15,  1998;  increased  legal,  examination  and
professional fees; and increased data processing fees primarily  associated with
Year 2000 activities.

Net Interest Income

         Net interest income  (expressed on a tax-equivalent  basis) improved to
$49.7 million,  or 4.53% of average earning  assets,  for the three months ended
September 30, 1999, from $43.7 million,  or 4.35% of average earning assets, for
the comparable  period in 1998. For the nine months ended September 30, 1999 and
1998,  net interest  income  (expressed  on a  tax-equivalent  basis) was $141.1
million,  or 4.44%,  and $122.3  million,  or 4.16%,  or average earning assets,
respectively.  The improved net interest income is primarily attributable to the
net  interest-earning  assets  provided  by the  acquisitions  of Century  Bank,
Redwood,  Pacific  Bay  Bank and  Republic  Bank,  internal  loan  growth  and a
reduction in the overall  cost of deposits.  For the three and nine months ended
September 30, 1999 and 1998, loans, on average,  increased by $549.1 million and
$586.6 million, respectively.  Contributing further to the improved net interest
income  is the  effect of (a) the  earnings  impact  of the  interest  rate swap
agreements  entered  into in 1998 and 1999;  (b) the  reduction  of First Bank's
deposit base associated with the divested branch facilities, which was primarily
concentrated  in  certificates  of  deposit;  and (c) a decrease  in the cost of
interest-bearing  liabilities  to 4.28% and 4.33%  from  4.67% and 4.79% for the
three and nine months ended September 30, 1999 and 1998, respectively.

         Although net interest margin improved,  the yield on the loan portfolio
declined  to 8.45% and 8.39% from 8.82% and 8.85% for the three and nine  months
ended  September  30,  1999 and 1998,  respectively.  This  reduction  primarily
results from the overall  decline in the prime lending rate  experienced  during
the latter part of 1998. In addition,  increased  competition  within the market
areas served by First Banks has also lead to reduced lending rates.

         The improved net interest margin is further offset by the  amortization
of deferred  hedging losses.  These costs were $1.4 million and $4.0 million for
the three and nine months ended  September  30, 1999,  in comparison to $990,000
and $3.0 million for the comparable periods in 1998, respectively.  The increase
is reflective of the liquidation of a portion of the underlying interest-bearing
liabilities,  primarily associated with the branch divestitures,  which resulted
in the additional recognition of a portion of the related deferred losses on the
previously terminated interest rate exchange agreements.


<PAGE>


         The following  table sets forth,  on a  tax-equivalent  basis,  certain
information  relating to First Banks' average balance  sheets,  and reflects the
average  yield  on  earning  assets,   the  average  cost  of   interest-bearing
liabilities  and the resulting net interest  income and net interest  margin for
the three and nine months ended September 30, 1999 and 1998:
<TABLE>
<CAPTION>

                                            Three months ended September 30,                   Nine months ended September 30,
                                     --------------------------------------------    -----------------------------------------------
                                              1999                    1998                      1999                    1998
                                      --------------------  ---------------------    ----------------------   ----------------------
                                            Interest                 Interest                 Interest                 Interest
                                     Average income/Yield/  Average income/Yield/     Average income/Yield/    Average income/Yield/
                                     balance  expenserate   balance expense rate      balance expense rate     balance expense rate
                                     -------  -----------   --------------------      --------------------     --------------------
                                                                      (dollars expressed in thousands)
             Assets
             ------

Interest-earning assets:
<S>                              <C>         <C>    <C>    <C>        <C>    <C>  <C>          <C>     <C>  <C>        <C>     <C>
   Loans(1)(2)(3)(4)...........  $3,846,498  81,972 8.45%  $3,297,377 73,311 8.82%$3,754,7702  35,724  8.39%$3,168,141 209,633 8.85%
   Investment securities(4)....     435,931   6,446 5.87      641,853 10,107 6.25     460,355  20,831  6.05    698,614  32,112 6.15
   Federal funds sold..........      59,807     744 4.94       39,430    527 5.30      29,266   1,154  5.27     58,919   2,404 5.46
   Other.......................       2,424      35 5.73        2,173     24 4.38       1,747      80  6.12      3,304     137 5.54
                                 ---------- -------        ---------- ------       ----------  ------        --------  -------
        Total interest-earning
          assets...............   4,344,660  89,197 8.15    3,980,833 83,969 8.37   4,246,138 257,789  8.12  3,928,978 244,286 8.31
                                            -------                   ------                  -------                  -------
Nonearning assets..............     347,829                   309,265                 342,858                   302,093
                                 ----------                ----------               ----------               ----------
        Total assets...........  $4,692,489                $4,290,098              $4,588,996                $4,231,071
                                 ==========                ==========              ==========                ==========

   Liabilities and Stockholders' Equity
   ------------------------------------

Interest-bearing liabilities:
   Interest-bearing deposits:
     Interest-bearing demand
       deposits................  $  388,880   1,269 1.29%  $  355,503  1,141 1.27% $  382,790   3,565  1.25%$  353,144   3,944 1.49%
     Savings deposits..........   1,217,845  10,962 3.57    1,116,879 11,226 3.99   1,221,226  32,976  3.61  1,038,717  31,011 3.99
     Time deposits of $100
       or more (3).............     234,496   3,151 5.33      208,753  2,992 5.69     219,666   8,903  5.42    216,439   9,586 5.92
     Other time deposits(3)....   1,688,345  22,386 5.26    1,627,137 23,436 5.71   1,635,220  65,516  5.36  1,688,111  72,880 5.77
                                 ---------- -------        ---------- ------       ---------- ------        ---------- -------
        Total interest-bearing
          deposits.............   3,529,566  37,768 4.25    3,308,272 38,795 4.65   3,458,902 110,960  4.29  3,296,411 117,421 4.76
   Federal funds purchased,
     repurchase agreements
     and Federal Home Loan
     Bank advances(3)..........      77,188     903 4.64       68,846    805 4.64      91,188   3,294  4.83     55,962   1,980 4.73
   Notes payable and other.....      55,995     873 6.19       44,107    702 6.31      51,683   2,406  6.22     50,593   2,623 6.93
                                 ---------- -------        ---------- ------        ---------- ------        --------- -------
        Total interest-bearing
          liabilities..........   3,662,749  39,544 4.28    3,421,225 40,302 4.67   3,601,773 116,660  4.33  3,402,966 122,024 4.79
                                            -------                   ------                  -------                  -------
Noninterest-bearing liabilities:
   Demand deposits.............     569,074                   461,287                 537,332                  448,517
   Other liabilities...........     177,165                   159,714                 174,410                  138,781
                                 ----------                ----------              ----------               ----------
        Total liabilities......   4,408,988                 4,042,226               4,313,515                3,990,264
Stockholders' equity...........     283,501                   247,872                 275,481                  240,807
                                 ----------                ----------              ----------               ----------
        Total liabilities and
          stockholders' equity.  $4,692,489                $4,290,098              $4,588,996               $4,231,071
                                 ==========                ==========              ==========               ==========

Net interest income............              49,653                   43,667                  141,129                  122,262
                                            =======                   ======                  =======                  =======
Net interest margin............                     4.53%                    4.35%                     4.44%                   4.16%
                                                   =====                    =====                    ======                    ====
------------
(1)  Nonaccrual  loans are  included in the average loan  amounts.
(2)  Interest income on loans  includes  loan fees.
(3)  Includes the effects of interest rate exchange agreements.
(4)  Information is presented on a  tax-equivalent  basis assuming a tax rate of
     35%.  The  tax-equivalent   adjustments  were  approximately  $152,000  and
     $543,000  for  the  three  and  nine  months  ended   September  30,  1999,
     respectively and $213,000 and $660,000 for the comparable periods in 1998.
</TABLE>


<PAGE>


Provision for Possible Loan Losses

         The  provision  for  possible  loan  losses was $2.9  million  and $8.7
million for the three and nine months ended September 30, 1999, compared to $2.3
million and $6.2 million for the comparable periods in 1998,  respectively.  The
increase in the provision for possible loan losses reflects the continued growth
and changing  composition of the loan  portfolio,  combined with the change from
net  loan  recoveries  in 1998 to net  loan  charge-offs  in 1999  caused  by an
increase in loans  charged-off.  Net loan  charge-offs  were  $901,000  and $4.2
million for the three and nine months ended September 30, 1999, in comparison to
net loan recoveries of $372,000 and $619,000 for the comparable periods in 1998.
The increase in net loan charge-offs is reflective of overall growth in the loan
portfolio,  increased risk  associated with the change in the composition of the
loan  portfolio  and  the  charge-off  of  certain  credit  relationships.   The
acquisitions  of Century  Bank,  Redwood,  Pacific  Bay Bank and  Republic  Bank
provided $1.5 million, $1.5 million, $885,000 and $2.3 million, respectively, in
additional allowance for possible loan losses.

         Tables summarizing  nonperforming assets, past due loans and charge-off
experience are presented  under  "--Lending and Credit  Management" of this Form
10-Q.

Noninterest Income

         Noninterest income was $9.0 million and $32.1 million for the three and
nine months ended  September  30, 1999,  in comparison to $9.0 million and $25.2
million  for  the  comparable  periods  in  1998.  Noninterest  income  consists
primarily of service  charges on deposit  accounts and  customer  service  fees,
mortgage banking revenues and other income.

         Service charges on deposit accounts and customer service fees were $4.4
million  and $12.8  million for the three and nine months  ended  September  30,
1999, in comparison to $3.8 million and $10.7 million for the comparable periods
in 1998, respectively. The increase in service charges and customer service fees
is attributable to (a) increased  deposit balances  provided by internal growth;
(b) the  acquisitions  of Century Bank,  Redwood,  Pacific Bay Bank and Republic
Bank;  (c)  additional  products  and services  available  and utilized by First
Banks' retail and commercial  customer base; (d) increased fee income  resulting
from  revisions of customer  service charge rates  effective  April 1, 1999, and
enhanced control of fee waivers; and (e) increased interchange income associated
with automatic  teller machine services and debit and credit cards. As described
below,  this increase was partially  offset by the foregone  revenue  associated
with the divestiture of certain branch  facilities in 1999,  which resulted in a
reduction in First Bank's deposit base of approximately $54.8 million.

         Credit  card  fees were  $35,000  and  $362,000  for the three and nine
months ended  September 30, 1999, in comparison to $695,000 and $2.3 million for
the  comparable  periods in 1998.  This reduction is primarily  attributable  to
First Banks'  liquidation  of its  merchant  credit card  processing  operation,
effective December 31, 1998.

         Mortgage  banking  revenues  consist  primarily of loan servicing fees,
net, and gains on mortgage loans sold and held for sale.  Loan  servicing  fees,
net,  decreased  to $113,000  and  $396,000  for the three and nine months ended
September  30, 1999,  from $177,000 and $880,000 for the  comparable  periods in
1998,  respectively.  This  decrease is  attributable  to: a reduction  in loans
serviced  for  others  resulting  from  the  repayment  and  prepayment  of  the
portfolio;  increased  amortization of mortgage servicing rights attributable to
high  refinancing  activity;  and  First  Banks'  strategy  of  selling  the new
production of adjustable-rate and nonconforming  residential mortgage loans on a
servicing  released  basis.  The gain on  mortgage  loans sold and held for sale
decreased  slightly to $1.6  million for the three months  ended  September  30,
1999,  from $1.8  million  for the  comparable  period in 1998,  while such gain
increased  to $5.4 million for the nine months ended  September  30, 1999,  from
$3.7 million for the comparable  period in 1998. The overall increase in 1999 is
primarily  attributable to an increased  volume of loans sold and held for sale,
including fixed rate residential  mortgage loans,  which are sold on a servicing
retained basis,  and  adjustable-rate  and  nonconforming  residential  mortgage
loans, which are sold on a servicing  released basis. In addition,  the increase
also  reflects  the  continued   expansion  of  First  Banks'  mortgage  banking
activities in the Texas and California market areas.


<PAGE>


         Net loss on sales  of  trading  securities  was  $303,000  for the nine
months ended September 30, 1999, in comparison to a net gain of $615,000 for the
comparable  period in 1998.  The loss for 1999 resulted from the  termination of
First Banks' trading division,  effective December 31, 1998, and the liquidation
of all trading portfolio securities.

         Other income  increased to $2.8 million and $12.7 million for the three
and nine months ended September 30, 1999, in comparison to $2.1 million and $6.2
million for the comparable periods in 1998, respectively. The primary components
of the increase are  attributable  to  increased  income  earned on First Banks'
investment in bank owned life insurance (BOLI),  expanded  brokerage and private
banking and trust services,  and a gain recognized on the divestiture of certain
branch facilities in the central and northern Illinois market areas. BOLI income
was $1.1 million and $2.8 million for the three and nine months ended  September
30, 1999, in comparison to $827,000 and $2.2 million for the comparable  periods
in 1998. This increase is primarily  attributable to FBA's initial investment in
BOLI  completed  in April 1998 and  increased  income  earned on the  underlying
investments.  In addition,  First Banks  recorded a pre-tax gain of $4.4 million
for the nine months ended  September 30, 1999 associated with the divestiture of
seven branch facilities in late March and early April of 1999.

Noninterest Expense

         Noninterest  expense was $37.5 million and $110.3 million for the three
and nine months ended  September  30, 1999,  in  comparison to $36.1 million and
$103.2 million for the comparable periods in 1998, respectively. The increase is
reflective of: (a) the acquisitions of Century Bank,  Redwood,  Pacific Bay Bank
and Republic Bank; (b) increased data processing fees primarily  associated with
First  Banks'  Year  2000  Program;   (c)  increased   legal,   examination  and
professional  fees and (d) the formation of First  America  Capital Trust (FACT)
and FACT's issuance of Cumulative  Trust Preferred  Securities in July 1998. The
overall  increase in noninterest  expense is partially  offset by a reduction in
advertising and business development expenses and communications  expenses,  and
is  consistent  with  management's  efforts  to more  effectively  manage  these
expenditures.  In addition, credit card expenses declined for the three and nine
months ended  September 30, 1999, in  comparison  to the  comparable  periods in
1998, and is primarily  attributable to First Banks' liquidation of its merchant
credit card processing operation, effective December 31, 1998.

         Salaries and  employee  benefits  increased to $15.6  million and $45.6
million for the three and nine months ended September 30, 1999, in comparison to
$14.6   million  and  $41.9  million  for  the   comparable   periods  in  1998,
respectively.  The increase is  attributable  to newly  acquired banks and First
Banks'  continued  commitment to expanding its  commercial  and retail  business
development  capabilities associated with expansion and delivery of its products
and services. The overall increase also reflects the competitive  environment in
the  employment  market  that  has  resulted  in a  higher  demand  for  limited
resources, thus escalating industry salary and employee benefit costs.

         Data  processing  fees  increased to $4.7 million and $13.9 million for
the three and nine months  ended  September  30,  1999,  in  comparison  to $3.7
million and $9.7 million for the comparable periods in 1998, respectively. First
Services,  L.P., a limited partnership indirectly owned by First Banks' Chairman
and his children, provides data processing and various related services to First
Banks and the Subsidiary  Banks under the terms of data  processing  agreements.
The increase in data processing fees is attributable to growth and technological
advancements  consistent  with  First  Banks'  product  and  service  offerings,
increased  expenses  attributable  to  communication  data lines  related to the
expansion of the branch network  infrastructure and expenses associated with the
Year 2000 Program.

         Guaranteed  preferred  debentures expense increased to $3.0 million and
$9.0  million  for the  three and nine  months  ended  September  30,  1999,  in
comparison to $2.8 million and $6.8 million for the comparable  periods in 1998.
Similar to First  Banks'  formation  of First  Preferred  Capital  Trust  (First
Capital)  and First  Capital's  issuance  of 9.25%  Cumulative  Trust  Preferred
Securities  (First  Capital  Preferred  Securities) in February 1997, FBA formed
FACT, a Delaware  business trust  subsidiary,  in July,  1998.  FACT issued 1.84
million shares of 8.50%  Cumulative  Trust Preferred  Securities (FACT Preferred
Securities) at $25.00 per share in an underwritten  public offering,  and issued
56,908 shares of common  securities to FBA at $25.00 per share.  FBA owns all of

<PAGE>

FACT's common  securities.  The gross proceeds of the offering were used by FACT
to  purchase  $47.4  million  of  8.50%  Subordinated  Debentures  (Subordinated
Debentures) from FBA, maturing on June 30, 2028. The Subordinated Debentures are
the sole asset of FACT.  In connection  with the issuance of the FACT  Preferred
Securities,  FBA made certain guarantees and commitments that, in the aggregate,
constitute a full and unconditional  guarantee by FBA of the obligations of FACT
under the FACT  Preferred  Securities.  FBA's  proceeds from the issuance of the
Subordinated  Debentures,  net of underwriting fees and offering expenses,  were
approximately  $44.1 million.  Guaranteed  preferred  debentures  expense on the
First Capital Preferred Securities and the FACT Preferred Securities is recorded
as noninterest expense in the accompanying consolidated financial statements.

                          Lending and Credit Management

         Interest earned on the loan portfolio  represents the principal  source
of income for First Banks and its Subsidiary  Banks.  Interest and fees on loans
were  91.6%  and  86.0% of total  interest  income  for the  nine  months  ended
September  30,  1999  and  1998,  respectively.  Total  loans,  net of  unearned
discount,  represented  82.3% and 78.6% of total assets as of September 30, 1999
and December 31, 1998, respectively.  Total loans, excluding loans held for sale
and net of unearned  discount,  increased by $502.8  million to $3.95 billion at
September  30, 1999 from $3.44  billion at December  31,  1998.  The increase in
loans, as summarized on the consolidated  balance sheets, is attributable to the
acquisitions of Century Bank and Redwood,  which provided loans, net of unearned
discount,  of $94.8  million and $134.4  million,  respectively,  and  continued
internal  growth  of $359.4  million.  This  increase  was  partially  offset by
declines in the portfolios of  residential  real estate  mortgage,  consumer and
installment  and loans held for sale of $34.8  million,  $51.0 million and $90.0
million, respectively. These fluctuations are attributable to the continued sale
of conforming  residential  mortgage loan production into the secondary mortgage
market,  reductions  in new  loan  origination  volumes  and  the  repayment  of
principal on the existing portfolios.

         First Banks'  nonperforming loans consist of loans on nonaccrual status
and loans on which the original terms have been restructured. The following is a
summary  of  nonperforming  assets and past due loans by  category  at the dates
indicated:
<TABLE>
<CAPTION>

                                                                             September 30,       December 31,
                                                                                 1999                 1998
                                                                                 ----                 ----
                                                                              (dollars expressed in thousands)

         Commercial, financial and agricultural:
<S>                                                                         <C>                        <C>
              Nonaccrual...............................................     $    17,653                15,385
              Restructured terms.......................................              29                    --
         Real estate construction and development:
              Nonaccrual...............................................           6,703                 3,858
         Real estate mortgage:
              Nonaccrual...............................................          18,610                18,858
              Restructured terms.......................................             965                 5,221
         Consumer and installment:
              Nonaccrual...............................................              61                   216
                                                                            -----------           -----------
                  Total nonperforming loans............................          44,021                43,538
         Other real estate.............................................           1,407                 3,709
                                                                            -----------           -----------
                  Total nonperforming assets...........................     $    45,428                47,247
                                                                            ===========           ===========

         Loans, net of unearned discount...............................     $ 3,992,953             3,580,105
                                                                            ===========           ===========
         Loans past due 90 days or more and still accruing.............     $     2,379                 4,674
                                                                            ===========           ===========

         Asset Quality Ratios:
              Allowance for possible loan losses to loans .............            1.72%                 1.70%
              Nonperforming loans to loans.............................            1.10                  1.22
              Allowance for possible loan losses to nonperforming loans          155.60                140.04
              Nonperforming assets to loans and other real estate......            1.14                  1.32
                                                                            ===========           ===========
</TABLE>


<PAGE>


         Nonperforming  loans (also considered  impaired  loans),  consisting of
loans on  nonaccrual  status  and  restructured  loans,  were  $44.0  million at
September 30, 1999,  in  comparison  to $43.5 million at December 31, 1998.  The
slight  increase is  primarily  attributable  to the overall  growth of the loan
portfolio,  principally  within  commercial,  financial and  agricultural,  real
estate  construction  and development,  and commercial real estate loans,  which
generally possess a higher level of inherent risk.

         The  following is a summary of loan loss  experience  for the three and
nine months ended September 30:
<TABLE>
<CAPTION>

                                                                           Three months ended     Nine months ended
                                                                               September 30,        September 30,
                                                                               ------------         -------------
                                                                              1999      1998      1999       1998
                                                                              ----      ----      ----       ----
                                                                                (dollars expressed in thousands)

<S>                                                                        <C>          <C>       <C>        <C>
Allowance for possible loan losses, beginning of period..................  $ 64,977     55,591    60,970     50,509
   Acquired allowances for possible loan losses..........................     1,542      2,315     3,008      3,200
                                                                           --------   --------  --------  ---------
                                                                             66,519     57,906    63,978     53,709
                                                                           --------   --------  --------  ---------
   Loans charged-off.....................................................    (3,626)    (1,899)  (11,154)    (6,037)
   Recoveries of loans previously charged-off............................     2,725      2,271     6,931      6,656
                                                                           --------   --------  --------  ---------
     Net loan (charge-offs) recoveries...................................      (901)       372    (4,223)       619
                                                                           --------   --------  --------  ---------
   Provision for possible loan losses....................................     2,880      2,275     8,743      6,225
                                                                           --------   --------  --------  ---------
Allowance for possible loan losses, end of period........................  $ 68,498     60,553    68,498     60,553
                                                                           ========   ========  ========  =========
</TABLE>

         The allowance for possible loan losses is monitored on a monthly basis.
Each month, credit administration provides First Banks' management with detailed
lists of loans on the watch list and  summaries of the entire loan  portfolio of
each Subsidiary Bank by risk rating.  These are coupled with analyses of changes
in the risk profiles of the  portfolios,  changes in past due and  nonperforming
loans and changes in watch list and classified  loans over time. In this manner,
the overall  increases or decreases in the levels of risk in the  portfolios are
monitored  continually.  Factors  are  applied to the loan  portfolios  for each
category of loan risk to determine  acceptable  levels of allowance for possible
loan losses. These factors are derived primarily from the actual loss experience
of the  Subsidiary  Banks and from  published  national  surveys of norms in the
industry.  The  calculated  allowances  required  for the  portfolios  are  then
compared to the actual allowance balances to determine the provisions  necessary
to maintain the  allowances  at  appropriate  levels.  In  addition,  management
exercises  judgment in its  analysis  of  determining  the overall  level of the
allowance for possible losses. In its analysis,  management considers the change
in the portfolio,  including  growth,  composition and the ratio of net loans to
total  assets,  and the economic  conditions of the regions in which First Banks
operates. Based on this quantitative and qualitative analysis, the allowance for
possible  loan  losses  is  adjusted.  Such  adjustments  are  reflected  in the
consolidated statements of income.



<PAGE>


                          Interest Rate Risk Management

         First  Banks   periodically   utilizes   off-balance-sheet   derivative
financial  instruments to assist in the management of interest rate  sensitivity
and  to  modify  the   repricing,   maturity  and  option   characteristics   of
on-balance-sheet  assets and liabilities.  Derivative financial instruments held
by First Banks for purposes of managing  interest  rate risk are  summarized  as
follows:
<TABLE>
<CAPTION>

                                                                 September 30, 1999          December 31, 1998
                                                              ------------------------   -------------------------
                                                               Notional       Credit        Notional     Credit
                                                                amount       exposure        amount      exposure
                                                                ------       --------        ------      --------
                                                                        (dollars expressed in thousands)

     Interest rate swap agreements - pay
<S>                                                           <C>               <C>          <C>          <C>
       adjustable rate, receive adjustable rate............   $  500,000         --               --         --
     Interest rate swap agreements - pay
       adjustable rate, receive fixed rate.................      455,000        228          280,000      3,526
     Interest rate floor agreements........................       35,000         15           70,000         29
     Interest rate cap agreements..........................       10,000         50           10,000        135
     Forward commitments to sell
       mortgage-backed securities..........................       47,000         --           95,000        237
                                                              ==========    =======          =======      =====
</TABLE>

         The  notional  amounts  of  derivative  financial  instruments  do  not
represent amounts exchanged by the parties and, therefore,  are not a measure of
First  Banks'  credit   exposure   through  its  use  of  derivative   financial
instruments.  The amounts  exchanged are determined by reference to the notional
amounts and the other terms of the derivatives.  The credit exposure  represents
the  accounting  loss First Banks  would  incur in the event the  counterparties
failed completely to perform according to the terms of the derivative  financial
instruments and the collateral was of no value.

         Previously,  First Banks  utilized  interest  rate swap  agreements  to
extend the repricing characteristics of certain interest-bearing  liabilities to
more closely correspond with its assets,  with the objective of stabilizing cash
flow, and  accordingly,  net interest  income,  over time. These swap agreements
were terminated in July 1995, November 1996 and July 1997 due to a change in the
composition of First Banks' balance sheet.  The change in the composition of the
balance sheet was primarily driven by the significant  decline in interest rates
experienced  during 1995, which caused an increase in the principal  prepayments
of residential  mortgage loans. The net interest  expense  associated with these
agreements,  consisting  primarily of amortization of deferred losses,  was $1.4
million and $4.0 million for the three and nine months ended September 30, 1999,
respectively,  and $990,000 and $3.0 million for the comparable periods in 1998.
The deferred  losses on terminated  swap agreements are being amortized over the
remaining lives of the agreements, unless the underlying liabilities are repaid,
in which case the deferred  losses are charged to  operations.  The  unamortized
balance of these losses was $1.4 million and $5.7 million at September  30, 1999
and December 31, 1998, respectively, and is included in other assets.

         During 1998, First Banks entered into $280.0 million notional amount of
interest rate swap  agreements.  The swap  agreements  effectively  lengthen the
repricing  characteristics of certain interest-earning assets to correspond more
closely with its funding source with the objective of stabilizing cash flow, and
accordingly,  net interest  income,  over time. The swap agreements  provide for
First  Banks to  receive a fixed rate of  interest  and pay an  adjustable  rate
equivalent to the 90-day London  Interbank  Offering Rate (LIBOR).  The terms of
the swap agreements provide for First Banks to pay quarterly and receive payment
semi-annually.  The amount  receivable by First Banks under the swap  agreements
was  $824,000  and $4.2  million at  September  30, 1999 and  December 31, 1998,
respectively,  and the amount  payable by First Banks under the swap  agreements
was  $607,000  and  $640,000  at  September  30,  1999 and  December  31,  1998,
respectively.

         During May 1999,  First  Banks  entered  into $500.0  million  notional
amount of interest rate swap  agreements  with the objective of stabilizing  the
net  interest  margin  during the  six-month  period  surrounding  the Year 2000
century date change.  The swap agreements  provide for First Banks to receive an
adjustable  rate of interest  equivalent to the daily  weighted  average  30-day
LIBOR and pay an adjustable  rate of interest  equivalent to the daily  weighted
average prime lending rate minus 2.665%. The terms of the swap agreements, which

<PAGE>

have an effective date of October 1, 1999 and a maturity date of March 31, 2000,
provide for First Banks to pay and receive interest on a monthly basis.

         During September 1999, First Banks entered into $175.0 million notional
amount of interest rate swap  agreements to  effectively  lengthen the repricing
characteristics  of certain  interest-earning  assets to correspond more closely
with its  funding  source  with the  objective  of  stabilizing  cash flow,  and
accordingly,  net interest  income,  over time. The swap agreements  provide for
First  Banks to  receive a fixed rate of  interest  and pay an  adjustable  rate
equivalent to the weighted  average prime lending rate minus 2.70%. The terms of
the swap  agreements  provide for First  Banks to pay and receive  interest on a
quarterly basis. The amount  receivable by First Banks under the swap agreements
was $119,000 at September  30, 1999 and the amount  payable by First Banks under
the swap agreements was $108,000 at September 30, 1999.

         The maturity dates, notional amounts, interest rates paid and received,
and fair values of the swap agreements outstanding as of September 30, 1999 were
as follows:
<TABLE>
<CAPTION>

                                                        Notional     Interest rate    Interest rate       Fair
                       Maturity date                     amount          paid           received          value
                       -------------                     ------          ----           --------          -----
                                                                      (dollars expressed in thousands)

<S>            <C> <C>                            <C>                     <C>           <C>             <C>
         March 31, 2000 (1).........................  $  350,000           --%             --          $   (324)
         March 31, 2000 (1).........................      75,000           --              --               (69)
         March 31, 2000 (1).........................      50,000           --              --               (46)
         March 31, 2000 (1).........................      25,000           --              --               (23)
         September 27, 2001.........................      75,000         5.55            6.14                33
         September 27, 2001.........................      45,000         5.55            6.14                20
         September 27, 2001.........................      40,000         5.55            6.14                18
         September 27, 2001.........................      15,000         5.55            6.14                 7
         June 11, 2002..............................      15,000         5.51            6.00              (115)
         September 16, 2002.........................     175,000         5.51            5.36            (4,574)
         September 16, 2002.........................      20,000         5.51            5.36              (523)
         September 18, 2002.........................      40,000         5.51            5.33            (1,079)
         September 18, 2002.........................      30,000         5.51            5.33              (810)
                                                      ----------                                        -------
                                                      $ 955,000          5.52            5.67          $ (7,485)
                                                      =========          ====            ====          ========
         --------------------
</TABLE>
         (1) These interest rate swap agreements  became effective on October 1,
             1999.

         First Banks has interest rate cap and floor  agreements  outstanding to
limit the interest expense associated with certain interest-bearing  liabilities
and  the  net  interest  expense  of  certain  interest  rate  swap  agreements,
respectively. At September 30, 1999 and December 31, 1998, the unamortized costs
of these agreements were $65,000 and $159,000,  respectively,  and were included
in other assets.

         Derivative  financial  instruments  issued by First  Banks  consist  of
commitments to originate  fixed-rate loans.  Commitments to originate fixed-rate
loans  consist   primarily  of  residential   real  estate  loans.   These  loan
commitments, net of estimated underwriting fallout, and loans held for sale were
$54.2  million and $103.1  million at September  30, 1999 and December 31, 1998,
respectively. These net loan commitments and loans held for sale are hedged with
forward contracts to sell mortgage-backed  securities of $47.0 million and $95.0
million at September  30, 1999 and December  31, 1998,  respectively.  Gains and
losses from  forward  contracts  are  deferred and included in the cost basis of
loans held for sale.  At  September  30, 1999 and  December  31,  1998,  the net
unamortized gains and losses were $1.1 million and $649,000, respectively, which
were  applied  to the  carrying  value of the loans held for sale as part of the
lower of cost or market valuation.



<PAGE>


                             Year 2000 Compatibility

         First Banks and the  Subsidiary  Banks are subject to risks  associated
with the "Year  2000"  issue,  a term which  refers to  uncertainties  about the
ability of various data  processing  hardware and software  systems to interpret
dates  correctly   surrounding  the  beginning  of  the  Year  2000.   Financial
institutions  are  particularly  vulnerable to Year 2000 issues because of heavy
reliance in the  industry  on  electronic  data  processing  and funds  transfer
systems.

         Data processing services are provided to First Banks by First Services,
L.P.  under the terms of data  processing  agreements.  To address the Year 2000
issue, First Banks, working jointly with First Services, L.P., has established a
dedicated  team  to  coordinate  the  overall  Year  2000  Preparedness  Program
(Program)  under the  guidelines of the  Comprehensive  Year 2000 Plan (Plan) as
approved by the Board of Directors.  The Plan summarizes each major phase of the
Program and the estimated costs to remediate and test systems in preparation for
the Year 2000.  The Plan addresses both  Information  Technology  (IT) projects,
such as data processing and data network applications, and non-IT projects, such
as building facilities and security systems. The major phases of the Program are
awareness, assessment, remediation, validation and implementation.

         The awareness phase included a company-wide campaign to communicate the
Year 2000 issue and the potential ramifications to the organization.  Concurrent
with this phase, the Year 2000 Program Team (Team) began the assessment phase of
the Program.  The assessment phase included the inventorying of systems that may
be impacted by the Year 2000 problem.  The business use of each inventoried item
was analyzed  and  prioritized  from  critical to  non-critical,  based upon the
perceived adverse effect on the financial  condition of First Banks in the event
of a loss  or  interruption  in the  use  of  each  system.  The  awareness  and
assessment phases of the Program were completed as scheduled.

         First  Banks'  critical  systems  are  purchased  from   industry-known
vendors. Such systems are generally used in their standard  configuration,  with
minor modification. Focusing on these critical systems, First Banks continues to
closely  review and monitor the Year 2000  progress as reported by each  vendor,
and has tested, in most cases, on a system separate from the on-line  production
system. The review and testing of critical data processing service providers was
substantially complete as of March 31, 1999.

         For the critical systems that have been modified,  the vendors provided
remediation  for such  systems  that were not  otherwise  reported as "Year 2000
ready." As the remediation phase was completed within the stated deadline, First
Banks did not invoke any remediation contingency efforts.

         Concurrent with the completion of the remediation phase of the Program,
First Banks  commenced the final analysis of the  validation  phase for critical
systems,  including  remediated  systems  provided by third party vendors.  This
portion of the Program was substantially complete as of December 31, 1998.

         First Banks  accelerated  the replacement of its existing teller system
(ISC), since certain functions of ISC were not Year 2000 compliant. Planning for
the  replacement  of ISC has been  underway  for several  years with the primary
objectives  of  adding  functionality  to meet  expanding  product  and  service
offerings and improving  efficiency in serving customers.  As the newly selected
teller  system  (CFI)  also  provided a solution  for the Year 2000  issue,  the
overall  implementation  schedule was  accelerated.  Recognizing  the heightened
risks of  deploying  CFI within the narrowed  timeline  created by the Year 2000
issue,  emphasis  was  first  given  to the Year  2000  solution  for ISC,  with
simultaneous  deployment of CFI occurring  throughout  1999.  The testing of the
Year 2000 solution for ISC was completed and ISC was upgraded  throughout  First
Banks' branch  network by June 30, 1999,  thereby  maintaining  compliance  with
appropriate regulatory guidelines associated with Year 2000.

         The testing of CFI was  completed by December 31, 1998.  The CFI system
was installed in selected bank test locations during the fourth quarter of 1998.
First Bank, FB&T, FB California and FB Texas have converted to CFI. Redwood Bank
and Century  Bank will not  convert to CFI in 1999.  The  estimated  cost of the
teller system  replacement is $8.0 million and will be charged to expense over a
60-month  period  beginning  in the  fourth  quarter of 1999.  First  Banks also
upgraded its local area network-based systems,  networks and core processor, and

<PAGE>

purchased certain item processing  equipment,  as the previous equipment,  which
was fully depreciated,  was not Year 2000 compliant. The estimated cost of these
upgrades and the item  processing  equipment  is $3.9 million and $1.4  million,
respectively,  and is  expected  to be  depreciated  to  expense  over 60 months
commencing in the first quarter of 1999.

         The final phase of the Program was the implementation of remediated and
other  systems into the  operating  environment  of First Banks.  With the final
phase of the  Program  substantially  completed  by June 30,  1999,  First Banks
continues to focus its efforts on overall contingency planning and specific Year
2000 event preparation.

         First Banks has also assessed the Year 2000 risks relating to its lines
of business  separate from its  dependence on data  processing.  The  assessment
includes a review of large  commercial  loan and deposit  customers to ascertain
their  overall  preparedness  regarding  Year 2000 risks.  The process  requires
lending and other  banking  officers to meet with certain of their  customers to
review and assess  their  overall  preparedness  for Year 2000 risks.  While the
process of evaluating the potential  adverse effects of Year 2000 risks on these
customers revealed no probable adverse effect to First Banks, it is not possible
to quantify the overall  potential adverse effects to First Banks resulting from
the  failure of these  customers,  or other  customers  not  meeting  the review
criteria,  to adequately  prepare for the Year 2000. The failure of a commercial
bank  customer  to  adequately  prepare  for Year 2000 could have a  significant
adverse  effect  on  such  customer's  operations  and  profitability,  in  turn
inhibiting  ability to repay loans in  accordance  with their terms or requiring
the use of its deposited  funds.  First Banks  continues to review and structure
certain   funding  sources  to  facilitate  the  Subsidiary   Banks'   liquidity
requirements under varying cash flow assumptions.  In addition,  Year 2000 risks
associated  with  adversely  rated  credits are  monitored  more  frequently  in
conjunction  with the internal watch list review committee  meetings,  while new
credit  relationships  include parameters to assess and evaluate Year 2000 risks
at the time of the initial credit decision.

         The Plan also provides for the  identification  and communication  with
significant non-data processing third party vendors regarding their preparedness
for Year 2000 risks.  While the results of this  process  have not  revealed any
quantifiable  loss to First Banks, the absence of certain basic services such as
telecommunications,  electric  power and  service  provided  by other  financial
institutions  and  governmental  agencies  would  have a  serious  impact on the
operations  of First  Banks.  First  Banks has  developed  processes  to monitor
significant non-data processing third party vendors regarding their preparedness
for Year 2000 risks.

         The total cost of the Program is currently  estimated at $16.2 million,
comprised  of  capital   improvements  of  $13.3  million  and  direct  expenses
reimbursable to First Services L.P. of $2.9 million.  The capital  improvements,
as previously discussed,  will be charged to expense in the form of depreciation
expense or lease  expense,  generally  over a period of 60 months.  First  Banks
incurred direct expenses  related to the Program of  approximately  $450,000 and
$1.4  million  for the three and nine  months  ended  September  30,  1999,  and
$600,000  for the year ended  December 31,  1998.  In  addition,  First Banks is
estimating  direct  expenses of $950,000 for the  duration of the  Program.  The
acquisitions  of Redwood and Century Bank are not expected to have a significant
impact on the total  cost of First  Banks'  Program.  The total  cost could vary
significantly from those currently  estimated for unforeseen  circumstances that
could develop in carrying out the Program.

         Concurrent  with  the  development  and  execution  of the  Plan is the
evolution of First Banks' Year 2000  Contingency  Plan  (Contingency  Plan). The
Contingency Plan is intended to be an evolving  document changing and developing
to  reflect  the  results,  progress  and  current  status of the  Program.  The
Contingency  Plan  addresses a variety of issues  including  critical and common
systems,  credit  risk,  liquidity,  loan  and  deposit  customers,  facilities,
supplies and computer back-up locations. Additionally, First Banks has developed
business  resumption plans and process resumption test plans for each functional
area deemed critical to the operations of First Banks. These business resumption
plans,  collectively with the Contingency Plan, also serve as evolving documents
and will  continue  to be  modified  to  appropriately  address  Year 2000 risks
associated  with the  individual  needs  and  responsibilities  of each of these
critical  functional  areas  based upon the  results of the  process  resumption
testing efforts.
<PAGE>

         In the remaining weeks leading up to the Year 2000 century date change,
First Banks will continue to focus its efforts on  implementation of the overall
Year 2000 Event Plan (Event  Plan).  The Event Plan was developed to establish a
coordinated management process for responding to potential Year 2000 disruptions
that addresses communications among appropriate officers, directors,  employees,
customers   and  third  party   suppliers.   The  Event  Plan  assigns   overall
responsibility  for  implementation  to  specific  individuals,  designates  key
personnel  who are  responsible  for carrying out specific  tasks and outlines a
program for notification of involved parties, including employees, customers and
third parties.  First Banks is in the process of testing the Event Plan in order
to  validate  its  completeness  and  accuracy.  Based upon the  results of this
testing,  First Banks will determine if additional Year 2000 event  preparations
are deemed necessary.

         While  First Banks is making a  substantial  effort to become Year 2000
compliant,  there is no assurance the Year 2000 problem will not have a material
adverse effect on its financial condition or results of operations.

                                    Liquidity

         The liquidity of First Banks and its Subsidiary Banks is the ability to
maintain  a cash  flow  which  is  adequate  to fund  operations,  service  debt
obligations and meet other  commitments on a timely basis.  The Subsidiary Banks
receive funds for liquidity from customer deposits, loan payments, maturities of
loans and  investments,  sales of investments and earnings.  In addition,  First
Banks and the Subsidiary  Banks may avail themselves of more volatile sources of
funds  through  the  issuance of  certificates  of deposit in  denominations  of
$100,000 or more,  federal funds borrowed,  securities sold under  agreements to
repurchase,  borrowings  from the Federal  Home Loan Bank and other  borrowings,
including   First  Banks'  $100  million  credit   agreement  with  a  group  of
unaffiliated  financial  institutions.  The aggregate  funds acquired from these
more volatile  sources were $476.7  million and $391.4  million at September 30,
1999 and December 31, 1998, respectively.

         The following  table presents the maturity  structure of volatile funds
at September 30, 1999:

                                                             (dollars expressed
                                                                in thousands)

      Three months or less.................................      $   246,824
      Over three months through six months.................           75,631
      Over six months through twelve months................         118,249
      Over twelve months...................................          35,959
                                                                 -----------
          Total............................................      $   476,663
                                                                 ===========

         In addition to these more volatile sources of funds,  First Bank, FB&T,
FB California and FB Texas have  established  borrowing  relationships  with the
Federal   Reserve  Bank  in  their   respective   districts.   These   borrowing
relationships,  which are secured by  commercial  loans,  provide an  additional
liquidity facility that may be utilized for contingency  purposes.  At September
30,  1999,   First  Banks'   borrowing   capacity  under  these  agreements  was
approximately $1.86 billion.

         Management  believes  available  liquidity and operating results of the
Subsidiary  Banks will be  sufficient  to provide funds for growth and to permit
the  distribution  of dividends to First Banks  sufficient  to meet First Banks'
operating and debt service requirements both on a short-term and long-term basis
and to pay the dividends on the First Capital Preferred  Securities and the FACT
Preferred Securities.

                       Effects of New Accounting Standards

         In June 1998, the Financial  Accounting  Standards  Board (FASB) issued
Statement of Financial  Accounting  Standards  (SFAS) No. 133 -- Accounting  for
Derivative  Instruments and Hedging  Activities (SFAS 133). SFAS 133 establishes
accounting and reporting standards for derivative instruments, including certain
derivative instruments embedded in other contracts,  and for hedging activities.
SFAS 133 requires that an entity  recognize all  derivatives as either assets or
liabilities in the statement of financial position and measure those instruments
at fair value.  If certain  conditions are met, a derivative may be specifically
designated as a hedge in one of three categories.  The accounting for changes in

<PAGE>

the fair  value of a  derivative  (that is,  gains and  losses)  depends  on the
intended use of the derivative and the resulting designation. Under SFAS 133, an
entity that elects to apply hedge  accounting is required to  establish,  at the
inception of the hedge,  the method it will use for assessing the  effectiveness
of the hedging  derivative  and the  measurement  approach for  determining  the
ineffective  aspect of the hedge.  Those  methods  must be  consistent  with the
entity's  approach to managing risk.  SFAS 133 applies to all entities.  In June
1999, the FASB issued SFAS No. 137 - Accounting for Derivative  Instruments  and
Hedging Activities  Deferral of the Effective Date of FASB Statement No. 133, an
Amendment of FASB Statement No. 133, which defers the effective date of SFAS 133
from fiscal years  beginning after June 15, 1999 to fiscal years beginning after
June 15, 2000. Initial  application should be as of the beginning of an entity's
fiscal  quarter;  on that date,  hedging  relationships  must be designated  and
documented  pursuant  to  the  provisions  of  SFAS  133,  as  amended.  Earlier
application  of all of the  provisions is encouraged but is permitted only as of
the beginning of any fiscal  quarter that begins after the issuance date of SFAS
133, as  amended.  Additionally,  SFAS 133,  as  amended,  should not be applied
retroactively to financial statements of prior periods. First Banks is currently
evaluating the requirements of SFAS 133, as amended,  to determine its potential
impact on the consolidated financial statements.

         On January 1, 1999,  First Banks adopted the provisions of SFAS No. 134
- Accounting for Mortgage-Backed Securities Retained after the Securitization of
Mortgage Loans Held for Sale by a Mortgage Banking  Enterprise,  an amendment of
FASB SFAS No. 65 (SFAS 134).  SFAS 134 amended SFAS 65 to require that after the
securitization  of mortgage  loans held for sale, an entity  engaged in mortgage
banking  activities  must classify the resulting  mortgage-backed  securities or
other retained  interests  based on its ability and intent to sell or hold those
investments. However, a mortgage banking enterprise must classify as trading any
retained mortgage-backed securities that it commits to sell before or during the
securitization  process.  The implementation of SFAS 134 did not have a material
impact on First Banks' consolidated financial statements.




<PAGE>


                          Part II -- OTHER INFORMATION

                    Item 6. Exhibits and Reports on Form 8-K

(a) The exhibits are numbered in  accordance  with the Exhibit Table of Item 601
    of Regulation S-K.

              Exhibit
              Number       Description

              10.6         $100,000,000  Amended  and  Restated  Secured  Credit
                           Agreement,  dated August 25, 1999, among First Banks,
                           Inc.  and   Mercantile   Bank  National  Association,
                           American National Bank and Trust Company of  Chicago,
                           Harris Trust and Savings  Bank,  the  Frost  National
                           Bank, Norwest Bank  Minnesota,  National  Association
                           and  Mercantile  Bank  National Association, as Agent
              10.12        Management  Services  Agreement  by and between First
                           Banks,  Inc. and  Redwood  Bank,  dated  June 1, 1999
              10.13        Management  Services  Agreement  by and between First
                           Banks, Inc. and Century Bank, dated September 1, 1999
               27          Article 9 - Financial Data Schedule (EDGAR only)

(b) First  Banks filed no reports on Form 8-K during the three  months  ended
    September 30, 1999.




<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.




                                       FIRST BANKS, INC.
                                       Registrant




Date:    November 10, 1999             By:   /s/ James F. Dierberg
                                       ---------------------------
                                                 James F. Dierberg
                                                 Chairman and
                                                 Chief Executive Officer



Date:    November 10, 1999             By:   /s/ Allen H. Blake
                                       ---------------------------
                                                 Allen H. Blake
                                                 President,
                                                 Chief Operating Officer
                                                 and Secretary
                                                 (Principal Financial Officer)


<PAGE>





                                  Exhibit 10.6

                  AMENDED AND RESTATED SECURED CREDIT AGREEMENT


                          ($100,000,000 Revolving Loan)

                           dated as of August 25, 1999

                                      among

                                First Banks, Inc.

                                       and

                      Mercantile Bank National Association

               American National Bank and Trust Company of Chicago

                          Harris Trust and Savings Bank

                             The Frost National Bank

                  Norwest Bank Minnesota, National Association

                                       and

                      Mercantile Bank National Association,

                                    as Agent


<PAGE>


                                                           TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                                               Page

<S>                                                                                                              <C>
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS.................................................................     1
       Section 1.01. Defined Terms..........................................................................     1
       Section 1.02. Accounting Terms.......................................................................     7


ARTICLE II. AMOUNT AND ACCOUNTING TERMS.....................................................................     8
       Section 2.01. Revolving Loan Commitments.............................................................     8
       Section 2.02. Termination or Reduction of Revolving Loan Commitment..................................     8
       Section 2.03. Interest on Revolving Loans............................................................     8
       Section 2.04. Notice and Manner of Borrowing.........................................................     9
       Section 2.05. Revolving Notes........................................................................    11
       Section 2.06 Method of Payment.......................................................................    11
       Section 2.07 Use of Proceeds.........................................................................    11
       Section 2.08 Zero Balance............................................................................    12
       Section 2.09 Advances and Payment....................................................................    12
       Section 2.10 Revolving Loan Commitment Fee...........................................................    12
       Section 2.11 Reimbursement...........................................................................    12
       Section 2.12 Failure of Any Bank to Make Revolving Loans.............................................    13
       Section 2.13 Banks Not Required to Extend Credit.....................................................    13


ARTICLE III. CONDITIONS PRECEDENT...........................................................................    13
       Section 3.01 Conditions Precedent to the Initial Loans...............................................    13
       Section 3.02 Conditions Precedent to All Revolving Loans.............................................    15


ARTICLE IV. REPRESENTATIONS AND WARRANTIES..................................................................    16
       Section 4.01 Incorporation, Good Standing, and Due Qualification.....................................    16
       Section 4.02 Corporate Power and Authority...........................................................    16
       Section 4.03 Legally Enforceable Agreement...........................................................    16
       Section 4.04 Financial Statements; Financial Condition...............................................    16
       Section 4.05 Other Agreements........................................................................    17
       Section 4.06 Litigation..............................................................................    17
       Section 4.07 Ownership of Subsidiaries...............................................................    17
       Section 4.08 ERISA...................................................................................    17
       Section 4.09 Taxes...................................................................................    18
       Section 4.10 Use of Proceeds; Margin Regulations.....................................................    18
       Section 4.11 Year 2000 Compliance....................................................................    18


ARTICLE V. AFFIRMATIVE COVENANTS............................................................................    18
       Section 5.01 Maintenance of Existence................................................................    18
       Section 5.02 Maintenance of Records..................................................................    18
       Section 5.03 Maintenance of Subsidiaries.............................................................    19
       Section 5.04 Compliance With Laws....................................................................    19
       Section 5.05 Right of Inspection.....................................................................    19
       Section 5.06 Reporting Requirements..................................................................    19
       Section 5.07 Operations..............................................................................    20
       Section 5.08 Additional Collateral...................................................................    21
       Section 5.09 Year 2000 Compliance....................................................................    21

</TABLE>

<PAGE>
<TABLE>
<CAPTION>

<S>                                                                                                             <C>
ARTICLE VI. NEGATIVE COVENANTS..............................................................................    21
       Section 6.01 Liens...................................................................................    21
       Section 6.02 Mergers, Etc............................................................................    21
       Section 6.03 Indebtedness............................................................................    22
       Section 6.04 Dividends...............................................................................    22
       Section 6.05 Stock Issue; Additional Issue of Stock of Subsidiary....................................    22
       Section 6.06 Stock Redemption........................................................................    22
       Section 6.07 Loans...................................................................................    22
       Section 6.08 Debentures..............................................................................    23
       Section 6.09 Continuation of Business................................................................    23


ARTICLE VII. FINANCIAL COVENANTS............................................................................    23
       Section 7.01 Tier I Leverage Ratio...................................................................    23
       Section 7.02 Tier I Leverage Ratio of Subsidiaries...................................................    23
       Section 7.03 Tier I Risk Based Capital Ratio.........................................................    23
       Section 7.04 Total Risk Based Capital Ratio..........................................................    24
       Section 7.05 Loan Loss Reserve.......................................................................    24
       Section 7.06 Net Income to Average Total Assets......................................................    24
       Section 7.07 Non-Performing Assets...................................................................    24


ARTICLE VIII. EVENTS OF DEFAULT.............................................................................    24
       Section 8.01 Events of Default.......................................................................    24


ARTICLE IX. AUTHORITY AND RESPONSIBILITIES OF AGENT.........................................................    27
       Section 9.01 Grant of Authority......................................................................    27
       Section 9.02 Action upon Indemnification Instructions................................................    27
       Section 9.03 Reports; Responsibility of the Agent; Disclaimer........................................    27
       Section 9.04 Correction of Errors....................................................................    28
       Section 9.05 Expenses; Indemnification...............................................................    28
       Section 9.06 Rights as Bank..........................................................................    29
       Section 9.07 Representation of Each Bank.............................................................    29
       Section 9.08 Rights to Resign; Appointment of a Successor Agent......................................    29
       Section 9.09 Notice of Default.......................................................................    30
       Section 9.10 Agent Compensation......................................................................    30


ARTICLE X. MISCELLANEOUS....................................................................................    30
       Section 10.01 Capital Adequacy Reimbursement.........................................................    30
       Section 10.02 Amendments, Etc........................................................................    30
       Section 10.03 Notices, Etc...........................................................................    31
       Section 10.04 No Waiver; Remedies....................................................................    31
       Section 10.05 Successors and Assigns.................................................................    31
       Section 10.06 Costs and Expenses.....................................................................    32
       Section 10.07 Right of Setoff........................................................................    32
       Section 10.08 Sharing of Setoffs.....................................................................    32
       Section 10.09 Governing Law; Jurisdiction and Venue..................................................    33
       Section 10.10 Severability of Provisions.............................................................    33
       Section 10.11 Counterparts...........................................................................    33
       Section 10.12 Headings...............................................................................    33
       Section 10.13 Oral Agreements........................................................................    33

</TABLE>


Exhibit A     -   Revolving Loan Commitment Amounts

Exhibit B     -   Revolving Credit Note

Exhibit C     -   Revolving Loan Notice of Borrowing

Exhibit D     -   Amended Restated Pledge Agreement
<PAGE>

Exhibit E     -   Certificate of Compliance

Exhibit F     -   Form of Borrower's Counsel Opinion

Exhibit G     -   Pledged Subsidiaries

Exhibit H     -   List of Affiliates

Exhibit I     -   Identification of Financial Statements

Exhibit J     -   Ownership of Subsidiaries



Schedule 4.05 - Other Agreements

Schedule 4.06 - Litigation

Schedule 4.08 - ERISA Plan Terminations

Schedule 8.01(10) - Regulatory Actions



<PAGE>






                  AMENDED AND RESTATED SECURED CREDIT AGREEMENT


                  THIS AMENDED AND RESTATED SECURED CREDIT AGREEMENT dated as of
August 25,  1999,  is entered  into by and among FIRST  BANKS,  INC., a Missouri
corporation ("Borrower"),  and MERCANTILE BANK NATIONAL ASSOCIATION,  a national
banking  association,  AMERICAN  NATIONAL BANK AND TRUST  COMPANY OF CHICAGO,  a
national banking  association,  HARRIS TRUST AND SAVINGS BANK, an Illinois state
banking  corporation,  THE FROST NATIONAL BANK, a national banking  association,
and NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, a national banking association
(each  individually a "Bank" and collectively the "Banks"),  and MERCANTILE BANK
NATIONAL ASSOCIATION, a national banking association, as Agent.

                           W I T N E S S E T H T H A T:

                  WHEREAS,  Borrower, the Banks and Agent are party to a Secured
Credit Agreement dated as of August 26, 1998 (as in effect  immediately prior to
the date hereof, the ("Original Credit  Agreement")  pursuant to which the Banks
have  severally made  available to Borrower a revolving  credit  facility in the
aggregate amount of Ninety Million Dollars ($90,000,000);

                  WHEREAS, Borrower has requested that the Banks extend the term
of the foregoing  revolving credit facility and to increase the aggregate amount
of the revolving credit facility to One Hundred Million Dollars ($100,000,000);

                  WHEREAS,  Borrower,  the Banks  and Agent  desire to amend and
restate the Original  Credit  Agreement in the form of this  Agreement to, inter
alia,  make  available to Borrower the revolving  credit  facility  provided for
herein; and

                  WHEREAS,  the Banks are  willing  severally  to  provide  such
revolving  credit  facility  to  Borrower,  subject to the terms and  conditions
hereinafter set forth;

                  NOW,  THEREFORE,  in  consideration  of the  premises  and the
mutual agreements herein set forth, the parties hereto hereby agree as follows:

                                   ARTICLE I.
                        DEFINITIONS AND ACCOUNTING TERMS

                  Section  1.01.  Defined Terms As used in this  Agreement,  the
following  terms have the following  meanings  (terms defined in the singular to
have the same meaning when used in the plural and vice versa):

                  "Affiliate"  means any Person (1) which directly or indirectly
controls,  or is controlled by, or is under common control with, the Borrower or
any Subsidiary; (2) which directly or indirectly beneficially owns or holds five
percent (5%) or more of any class of voting stock of Borrower or any Subsidiary;
or (3) five  percent  (5%) or more of the voting  stock of which is  directly or
indirectly  beneficially  owned or held by Borrower or any Subsidiary.  The term
"Control" for the purposes of this Agreement means the  possession,  directly or
indirectly,  of the power to direct or cause the direction of the management and
policies of a Person,  whether  through the ownership of voting  securities,  by
contract,  or  otherwise.  For  the  purposes  of the  foregoing  definition,  a
shareholder  of  Borrower  shall  not be  deemed to be  directly  or  indirectly
controlling  or controlled by the Borrower or a subsidiary,  provided the person
in question will not receive any proceeds from the Loans.

                  "Agent" means Mercantile Bank National Association,  acting in
its  capacity  as Agent  pursuant  to Article  IX hereof and any duly  appointed
successor.
<PAGE>

                  "Agreement"  means  this  Amende  and  Restated Secured Credit
 Agreement, as amended,  supplemented or modified from time to time.

                  "Applicable Margin" shall mean, with respect to each Revolving
Loan accruing  interest based on the Eurodollar  Rate, the rate per annum listed
in the applicable column below:
<TABLE>
<CAPTION>

----------------------------------------------------------- -------------- ------------- ------------ -------------
<S>                                                            <C>          <C>           <C>          <C>
If the Performance Ratio is:                                  -1.0:1       +1.00:1       +1.75:1      +2.25:1
                                                                           -1.75:1       -2.25:1
----------------------------------------------------------- -------------- ------------- ------------ -------------
Applicable Margin                                              0.875%         1.00%        1.125%        1.25%
----------------------------------------------------------- -------------- ------------- ------------ -------------
</TABLE>

The  determination of the Applicable Margin as of any date shall be based on the
Performance  Ratio as of the end of the most  recently  ended fiscal  quarter of
Borrower  for  which  consolidated  financial  statements  of  Borrower  and its
Subsidiaries  have been  delivered to the Banks  pursuant to Section  5.06,  and
shall be effective for purposes of determining  the  Applicable  Margin from and
after the first day of the month  immediately  following  the date on which such
delivery of financial  statements  is required  until the first day of the first
month immediately following the next such date on which delivery of consolidated
financial  statements  of Borrower  and its  Subsidiaries  is so  required.  For
example,  the Performance  Ratio as of the end of the fiscal quarter of Borrower
ending September 30, 1999,  would be determined from the consolidated  financial
statements  of Borrower  and its  Subsidiaries  as of and for the period  ending
September  30, 1999 (which are  required to be  delivered  to Agent on or before
November 14, 1999), and would be used in determining the Applicable  Margin from
and after  December 1, 1999.  All such  adjustments  shall be  applicable to all
existing  Revolving  Loans as well as any new  Revolving  Loans  made or issued;
provided,  that, an adjustment in the Applicable  Margin during the course of an
Interest Period will not result in a change in the Eurodollar Rate applicable to
that Interest Period.

                  "Average Total Assets" for any Person,  at any time, means the
amount set forth on the most recent report on form FRY-9C filed by Borrower with
the Board of Governors of the Federal  Reserve System (or any successor  report)
as "Average Total Assets."

                  "Bank" or "Banks" has the meaning assigned to such term in the
preamble to this Agreement.

                  "Borrower"  has  the meaning  assigned  to  such  term  in the
preamble of this Agreement.

                  "Business Day" means any day other than a Saturday, Sunday, or
other day on which  commercial  banks are  authorized or required to close under
the laws of the States of Missouri,  Illinois,  Texas or  California;  provided,
that,  when used in connection  with a Revolving  Loan, such day shall also be a
day on which dealings  between banks are carried on in U.S.  dollar  deposits in
London, England.

                  "Call Report" has the meaning assigned to such term in Section
5.06(4).

                  "Certificate" has the meaning assigned to such term in Section
2.04(1).

                  "Collateral"  means all property  which is subject or is to be
subject to the Liens granted by the Pledge Agreement.

                  "Commitment" means the several commitments of the Banks in the
aggregate original principal amount of $100,000,000, or when used with reference
to a particular Bank, the portion of the several  commitments  allocated to such
Bank to make loans to the Borrower  pursuant to Section 2.01 equal to the amount
stated in Exhibit A, as such amount may be reduced from time to time pursuant to
Section 2.02 hereof.

                  "Default"  means any of the events  specified in Section 8.01,
whether or not any requirement  for the giving of notice,  the lapse of time, or
both, or any other condition, has been satisfied.
<PAGE>

                  "Equity Capital" for any Person, at any time, means the amount
set forth on the most recent  report on form FRY-9C  filed by Borrower  with the
Board of Governors of the Federal  Reserve  System (or any successor  report) as
"Total Equity Capital."

                  "ERISA" means the Employee  Retirement  Income Security Act of
1974,  as  amended  from  time  to  time,  and  the  regulations  and  published
interpretations thereof.

                  "ERISA  Affiliate" means any trade or business (whether or not
incorporated)  which  together  with the  Borrower  would be treated as a single
employer under Section 4001 of ERISA.

                  "Eurodollar Rate" means, for each applicable  Interest Period,
an interest  rate per annum equal to (i) the rate per annum  (rounded  upward to
the nearest whole multiple of 1/32 of 1% per annum,  if such average is not such
a multiple) at which  deposits in United States Dollars are offered or available
to banks in the London  interbank  market at 9:00 A.M. (St.  Louis time) two (2)
Business  Days  before  the first day of such  Interest  Period as  reported  on
Telerate  page 3750 (or such  other page as may  replace  such page 3750 on such
system for the purpose of reporting  comparable  rates of major banks) under the
heading for British  Bankers  Association  LIBOR Rates in the column  designated
"USD" (United States Dollar), as published by Bridge Information Systems,  Inc.,
for a period  comparable to such Interest Period for an amount comparable to the
subject  Eurodollar  Rate Loan divided by (ii) a percentage  equal to 100% minus
the  then  stated  maximum  rate  of all  reserve  requirements  (including  any
marginal, emergency, supplemental, special or other reserves) applicable on such
date  to  any  member  bank  of  the  Federal   Reserve  System  in  respect  of
"Eurocurrency  liabilities"  as defined in Regulation D (or any other  successor
category of liabilities under Regulation D).

                  "Event  of  Default"  means  any of the  events  specified  in
Section 8.01,  provided that any requirement for the giving of notice, the lapse
of time, or both, or any other applicable condition, has been satisfied.

                  "Federal  Funds Rate"  means,  for any day, the rate per annum
(rounded  upward,  if  necessary,  to the  nearest  1/100th  of 1%) equal to the
weighted  average of the rates of  overnight  Federal  funds  transactions  with
members of the Federal  Reserve System arranged by Federal funds brokers on such
day, as  published  by the Federal  Reserve Bank of New York on the Business Day
next succeeding  such day,  provided that (i) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such  transactions  on
the next preceding Business Day as so published on the next succeeding  Business
Day, and (ii) if no such rate is so published on such next  succeeding  Business
Day, the Federal Funds Rate for such day shall be the average rate quoted to the
Agent on such day on such transactions as determined by the Agent.

                  "Funded  Debt"  shall  mean as of any  date,  the  outstanding
principal amount of all Revolving Loans on such date.

                  "GAAP" means generally accepted  accounting  principles in the
United States as in effect from time to time,  including such  principles as are
utilized  in the  preparation  of Call  Reports  and  other  regulatory  reports
required to be filed by Borrower and its Subsidiaries.

                  "Interest  Period" means the period  commencing on the date of
making or conversion to or continuation of a Loan that accrues interest based on
the  Eurodollar  Rate. The Borrower shall have the option to select a one month,
two month, or three month Interest Period; provided,  however, that whenever the
last day of any  Interest  Period  would  otherwise  occur on a day other than a
Business Day, the last day of such Interest Period shall be extended to occur on
the next  succeeding  Business Day;  provided,  however,  that if such extension
would cause the last day of such Interest  Period to occur in the next following
calendar  month,  the last day of such  Interest  Period shall occur on the next
preceding  Business Day.  Notwithstanding  the  foregoing,  the Borrower may not

<PAGE>

select an Interest  Period  which ends after the  Revolving  Credit  Termination
Date.  For purposes of determining  an Interest  Period,  a month means a period
starting  on  one  day  in  a  calendar   month  and  ending  on  a  numerically
corresponding day in the next calendar month, provided,  however, if an Interest
Period  begins  on the  last  day  of a  month  or if  there  is no  numerically
corresponding  day in the month in which an Interest Period is to end, then such
Interest Period shall end on the last Business Day of such month.

                  "Lien" means any  mortgage,  deed of trust,  pledge,  security
interest,  hypothecation,  assignment,  deposit arrangement,  encumbrance,  lien
(statutory or other), or preference,  priority,  or other security  agreement or
preferential  arrangement,   charge,  or  encumbrance  of  any  kind  or  nature
whatsoever (including,  without limitation,  any conditional sale or other title
retention agreement,  any financing lease having substantially the same economic
effect as any of the foregoing,  and the filing of any financing statement under
the Uniform  Commercial  Code or comparable law of any  jurisdiction to evidence
any of the foregoing).

                  "Loan  Document(s)"  means this  Agreement,  the Notes and the
Pledge  Agreement,  as  each  may be  renewed,  extended,  amended,  rearranged,
restructured,  restated,  replaced  or  otherwise  modified  from  time to time,
including without  limitation,  modifications to interest rates or other payment
terms.

                  "Loan Loss Reserve" for any Person, for any period,  means the
amount set forth on the most recent report on form FRY-9C filed by Borrower with
the Board of Governors of the Federal  Reserve System (or any successor  report)
applicable to such period as "Allowance for loan and lease losses."

                  "Loans" means the Revolving Loans.

                  "Majority" has  the  meaning  assigned to such term in Section
9.01.

                  "Multiemployer Plan" means a Plan described in Section 4001(a)
(3)  of ERISA which covers employees of a Borrower or any ERISA Affiliate.

                  "Net  Income" for any period means the amount set forth on the
report on form  FRY-9C  filed by  Borrower  with the Board of  Governors  of the
Federal Reserve System or any successor report applicable to such period as "Net
Income."

                  "Non-performing Assets" for any Person, at any time, means the
sum of the amounts set forth on the most recent  report on form FRY-9C  filed by
Borrower  with the Board of  Governors  of the  Federal  Reserve  System (or any
successor  report)  as  loans  "past  due 90 days or more and  still  accruing,"
"non-accrual," and "other real estate owned."

                  "Notes" means the Revolving Notes.

                  "Original  Credit  Agreement" has the meaning assigned to such
term in the recitals to this Agreement.

                  "PBGC" means the Pension Benefit Guaranty  Corporation or  any
entity  succeeding to any or all of its functions under ERISA.

                  "Performance  Ratio" means,  as of any date,  the ratio of (x)
Funded  Debt  outstanding  on  such  date  to (y)  Borrower's  Net  Income  less
extraordinary  and/or nonrecurring items (as determined in accordance with GAAP)
for the most recently ended period of four fiscal quarters of Borrower.

                  "Person"  means  an  individual,   partnership,   corporation,
business trust, joint stock company, trust,  unincorporated  association,  joint
venture, governmental authority, or other juridical entity of whatever nature.
<PAGE>

                  "Plan" means any employee  benefit or other plan  established,
maintained,  or to which  contributions  have been made by the  Borrower  or any
ERISA Affiliate.

                  "Pledge  Agreement" means the amended and restated  collateral
pledge agreement in the form of Exhibit D, pledging to the Agent for the ratable
benefit of the Banks all of the stock of the Pledged Subsidiaries  (exclusive of
directors' qualifying shares of stock) and certain stock acquired after the date
of this Agreement.

                  "Pledged   Subsidiaries"  means  the  Subsidiaries  listed  on
Exhibit G attached hereto.

                  "Primary  Capital" for any Person,  for any period and without
duplication,  means the sum of Equity Capital plus the Loan Loss Reserve of such
Person.

                  "Prime Rate" means the per annum rate of interest announced by
Mercantile Bank National Association (or its successor) from time to time as its
Prime Rate,  which rate is not intended or  represented to be the lowest rate of
interest charged by such Bank to its borrowers.

                  "Prohibited  Transaction" means any  transaction  set forth in
Section 406 of ERISA or  Section 4975 of  the Internal Revenue Code  of 1954, as
amended from time to time.

                  "Reportable  Event"  means  any  of  the  events  set forth in
Section 4043 of ERISA.

                  "Revolving Credit Termination Date" means August 24, 2000.

                  "Revolving  Loan"  means the  aggregate  of all loans  made to
Borrower  by the  Banks as  provided  herein;  or when used  with  respect  to a
particular  Bank,  a loan made to Borrower by such Bank as provided  herein;  or
when used with  respect  to a request by  Borrower  for the making of loans on a
particular date as provided herein, the aggregate of such loans.

                  "Revolving Loan  Limit"  has the meaning assigned to such term
in Section 2.01.

                  "Revolving  Loan  Commitment"  means,  as to  each  Bank,  the
maximum  amount  which such Bank shall be  obligated  to loan to  Borrower  as a
Revolving Loan pursuant to Section 2.01 hereof.

                  "Revolving Loan  Commitment  Fee" has the meaning  assigned to
such term in Section 2.10.

                  "Revolving Loan Notice of Borrowing" has the meaning  assigned
to such term in Section 2.04.

                  "Revolving Notes" has  the  meaning  assigned  to such term in
Section 2.05.

                  "Subsidiary"  means, as to Borrower,  any corporation of which
shares of stock having ordinary voting power (other than stock having such power
only by reason of the  happening  of a  contingency)  to elect a majority of the
board of directors or other managers of such  corporation are at the time owned,
or the  management of which  corporation  is otherwise  controlled,  directly or
indirectly  through  one or more  intermediaries,  or both,  by a Borrower  or a
Subsidiary of Borrower.

                  "Tier I  Leverage  Ratio"  means  the  ratio,  expressed  as a
percentage,  of regulatory "core" capital (Tier I) to assets, all as defined and
determined from time to time by applicable bank regulatory authorities.
<PAGE>

                  "Tier  I  Risk  Based  Capital   Ratio"  means  the  ratio  of
regulatory "core" capital (Tier I) to weighted-risk assets and off-balance sheet
items,  all as  defined  and  determined  from time to time by  applicable  bank
regulatory authorities.

                  "Total Assets" for any Person,  at any time,  means the amount
set forth on the most recent  report on form FRY-9C  filed by Borrower  with the
Board of Governors of the Federal  Reserve  System (or any successor  report) as
"Total Assets."

                  "Total Loans" means,  at any time, the amount set forth on the
most recent  report on form FRY-9C filed by Borrower with the Board of Governors
of the Federal  Reserve System (or any successor  report) as the total of "Loans
and Leases, net of unearned income."

                  "Total Risk Based Capital  Ratio" of any Person means,  at any
time, the ratio of regulatory "core" capital (Tier I) and supplementary  capital
elements (Tier II) to weighted-risk  assets and off-balance  sheet items, all as
defined  and  determined  from  time  to  time  by  applicable  bank  regulatory
authorities.

                  "Year 2000 Compliant"  shall mean, with respect to any Person,
that all software,  embedded  microchips and/or other computer and/or processing
capabilities utilized by such Person, and/or included in any software, products,
goods and/or  services sold and/or leased by such Person,  are able to correctly
and properly recognize,  interpret,  process,  calculate,  compare, sequence and
manipulate data and date-sensitive functions on and involving all calendar dates
(including, without limitation, dates in and after the year 2000).

                  Section  1.02.  Accounting  Terms.  All  accounting  terms not
specifically   defined  herein  shall  be  construed  in  accordance  with  GAAP
consistent with those applied in the preparation of the financial statements and
reports  referred to in Section 5.06, and all financial data submitted  pursuant
to this Agreement shall be prepared in accordance with such principles.

                                   ARTICLE II.
                       AMOUNT AND TERMS OF REVOLVING LOAN

                  Section 2.01. Revolving Loan Commitments. Subject to the terms
and conditions of this Agreement (including,  without limitation,  the terms and
conditions  of Article III hereof),  the Banks  severally  and not jointly agree
from time to time on any Business Day to make loans to the Borrower from time to
time  during  the  period  from  the date  hereof  up to but not  including  the
Revolving  Credit  Termination  Date in  individual  amounts  not to exceed each
Bank's  Revolving  Loan  Commitment  as set forth  opposite  such Bank's name in
Exhibit A, the aggregate  principal amount of which at any time shall not exceed
One Hundred Million  Dollars  ($100,000,000)  (the "Revolving Loan Limit").  Any
amounts  advanced  and repaid by Borrower  shall be treated as  prepayments  and
shall be eligible for  reborrowing by Borrower in the absence of a Default or an
Event of Default, subject to the terms and conditions of this Agreement.

                  Section  2.02.  Termination  or Reduction  of  Revolving  Loan
Commitment.  The  Borrower  shall have the  right,  upon at least  fifteen  (15)
Business Days' notice to the Agent, to terminate in whole or permanently  reduce
in part the unused portion of the Revolving Loan Commitment.  Any such reduction
by  Borrower  of the  Revolving  Loan  Commitment  shall  result  in a pro  rata
reduction of each Bank's Revolving Loan Commitment.

                  Section 2.03.  Interest on Revolving Loans. The Borrower shall
pay  interest to the Agent for the account of the Banks on the  outstanding  and
unpaid  principal amount of the Revolving Loans made under this Agreement at the
following intervals and at the following rates per annum:

                  (1) Prime  Rate.  If such  Revolving  Loan is  accruing at the
         Prime  Rate,  a  fluctuating  rate per annum equal to the Prime Rate in

<PAGE>

         effect from time to time.  Any change in the  interest  rate  resulting
         from a change  in the  Prime  Rate  shall  become  effective  as of the
         opening of  business  on the day on which such change in the Prime Rate
         shall become  effective.  Interest  shall be calculated on the basis of
         the actual  number of days  elapsed  over a year of 360 days.  Interest
         shall be paid in  immediately  available  funds on or before 12:00 Noon
         (St.  Louis  time) on the first day of each  calendar  month  beginning
         October 1, 1999, and on the Revolving Credit  Termination  Date. In the
         event of receipt of funds after 12:00 Noon (St. Louis time) on the date
         of  payment,  the  funds  shall be deemed  to be  received  on the next
         Business   Day,  and  the  accrual  of  interest   will  be  calculated
         accordingly;

                  (2)  Eurodollar  Rate.  If such  Revolving  Loan  is  accruing
         interest  based on the  Eurodollar  Rate, a rate per annum equal at all
         times during the applicable  Interest Period for such Revolving Loan to
         the sum of the  Eurodollar  Rate  for  such  Interest  Period  plus the
         Applicable Margin in effect from time to time,  payable on the last day
         of the Interest  Period  applicable to each such  Revolving Loan and on
         the Revolving Credit Termination Date.  Interest shall be calculated on
         the basis of the actual number of days elapsed over a year of 360 days.
         Interest  shall be paid in  immediately  available  funds on or  before
         12:00  Noon (St.  Louis  time) on the last day of the  Interest  Period
         applicable  to each such  Revolving  Loan and on the  Revolving  Credit
         Termination  Date.  In the event of receipt of funds  after  12:00 Noon
         (St.  Louis time) on the date of payment,  the funds shall be deemed to
         be received on the next  Business Day, and the accrual of interest will
         be calculated accordingly;

provided,  however,  that,  from and after the occurrence of an Event of Default
and unless and until such  Event of Default is waived,  the  Borrower  shall pay
interest on the unpaid  principal amount of each Revolving Loan outstanding at a
rate per annum  equal to four  percent  (4%) per annum above the  interest  rate
otherwise  in effect  from time to time with  respect  to such  Revolving  Loan,
including without limitation any interest rate in effect as a consequence of the
provisions of Section 2.04(1),  such interest being payable on demand. The Agent
shall  give  prompt  notice  to the  Borrower  and the  Banks of the  applicable
interest rate for each  Revolving  Loan  determined by the Agent for purposes of
this Section 2.03.

                  Section 2.04.     Notice and Manner of Borrowing.
                  (1) The  Borrower  shall give the Agent  (who  shall  promptly
notify the Banks)  telephonic  notice (followed  immediately by written or telex
notice  substantially  in the form of  Exhibit C hereto)  of any  request  for a
Revolving Loan under this Agreement (a "Revolving  Loan Notice of Borrowing") at
least five (5) Business Days before such Revolving Loan is requested to be made,
specifying  (i) the date such Loan is  requested  to be made,  the  purpose  and
amount  thereof,  and (ii) the interest rate  applicable to such Revolving Loan.
The written form of the Revolving Loan Notice of Borrowing  shall be accompanied
by a Compliance Certificate (the "Certificate") in the form of Exhibit E hereto.
At least three (3) Business  Days before the end of each  Interest  Period,  the
Borrower shall give the Agent (who shall promptly  notify the Banks) a Revolving
Loan Notice of Borrowing  with respect to the relevant  Revolving  Loan accruing
interest based on the Eurodollar  Rate specifying the new Interest Period or, in
the event that the relevant  Revolving  Loan is to accrue  interest at the Prime
Rate,  specifying  the same. In the event that in any  Revolving  Loan Notice of
Borrowing  hereunder the interest  rate of the Revolving  Loan to be advanced is
not  specified  (or if Borrower is not entitled to request the  Eurodollar  Rate
pricing option pursuant to the terms hereof),  the Revolving Loan to be advanced
shall  accrue  interest at Prime Rate.  Subject to the  limitations  in the next
sentence and in Section 2.04(2)(c), Borrower may in any Revolving Loan Notice of
Borrowing  request a Revolving Loan that is the aggregate of separate  Revolving
Loans that will accrue  interest at different  interest  rates and for different
Interest Periods as provided  herein.  Each Revolving Loan shall be in an amount
of at least One Million  Dollars  ($1,000,000)  and  integral  multiples  of One
Hundred  Thousand  Dollars  ($100,000) in excess thereof or, if less, the unused
amount of the Revolving  Loan  Commitment.  Not later than 2:00 P.M. (St.  Louis
time) on the date such Revolving Loan is requested to be made, or if later, upon
fulfillment  of the applicable  conditions  set forth herein,  the Banks via the
Agent will make such  Revolving  Loan  available to the Borrower in  immediately
available  funds by wire  transfer of Federal  funds to the  Borrower.  Upon the
request (in  writing) of the  Borrower,  the Agent and the Banks shall use their

<PAGE>

reasonable  best efforts to make such Revolving  Loans available to the Borrower
prior to 2:00 P.M. (St. Louis time),  provided,  however,  neither the Agent nor
the Banks shall have any  liability  to the Borrower or any other Person for any
failure to provide such funds prior to 2:00 P.M.  (St.  Louis time)  pursuant to
such request.  All notices  given under this Section 2.04 shall be  irrevocable,
and telephonic notices shall be given not later than 11:00 A.M. (St. Louis time)
on the day which is not later than the number of Business Days  specified  above
for such  notice.  If an Event of  Default  exists  hereunder  at the end of the
Interest  Period of a Revolving  Loan accruing  interest based on the Eurodollar
Rate,  such  Revolving Loan shall  immediately  and  automatically,  and without
necessity  of any  further  act by the  Borrower,  the  Banks or the  Agent,  be
refinanced by a Revolving Loan accruing at the Prime Rate (as adjusted  pursuant
to Section 2.03) in the same principal  amount.  Any costs and expenses incurred
by the  Banks or the  Agent by virtue  of such  refinancing  (including  without
limitation any costs and expenses that may be due under Section  10.06(2)) shall
be promptly  paid by  Borrower  to the Agent for the  account of the  applicable
Banks on the demand of the Agent,  and all the Revolving Loans shall  thereafter
accrue interest at the Prime Rate (as adjusted pursuant to Section 2.03).

                  (2)      Anything  in  subsection  (1)  above  to the contrary
notwithstanding,

                           (a)      if the  Agent  shall  notify   the  Borrower
that the introduction of or any change in or in the interpretation of any law or
regulation  makes it unlawful,  or that any central  bank or other  governmental
authority  asserts  that it is  unlawful,  for the  Agent or any of the Banks to
perform its obligations hereunder with respect to the making of a Revolving Loan
accruing  interest  based  on the  Eurodollar  Rate  or to fund  or  maintain  a
Revolving Loan based on the Eurodollar Rate hereunder, the right of the Borrower
to select,  continue or convert a Revolving Loan to the Eurodollar Rate shall be
suspended  until the Agent  shall  notify the  Borrower  that the  circumstances
causing such suspension no longer exist; and upon the sending of such notice and
without  the  necessity  of any further  act by the  Borrower,  the Banks or the
Agent, the outstanding Revolving Loans accruing interest based on the Eurodollar
Rate shall immediately and automatically be refinanced by Revolving Loans in the
same principal  amount,  and all of the Revolving Loans shall thereafter  accrue
interest at the Prime Rate;  and the Borrower in such event shall pay the Agents
for the account of the  applicable  Banks any costs and expenses  identified  in
Section 10.06(2); and

                          (b)      if  the  Agent is  unable,  after  reasonable
efforts,  due to prevailing market conditions,  to obtain timely information for
the  determination  of the Eurodollar  Rate, or is otherwise unable to determine
the Eurodollar  Rate at any time, the right of the Borrower to select,  continue
or convert a Revolving Loan to the Eurodollar  Rate shall be suspended until the
Agent shall notify  Borrower that the  circumstances  causing such suspension no
longer  exist,  and each  Revolving  Loan  requested by the Borrower  after such
notice  shall  accrue  interest  at the  Prime  Rate,  and each  Revolving  Loan
outstanding on the date of such notice that is accruing interest
based on the Eurodollar  Rate shall,  after the end of the  applicable  Interest
Period for such Revolving Loan, accrue interest at the Prime Rate; and

                           (c)      if, at any time,  five (5) or more Revolving
Loans are  accruing  at an  interest  rate based upon the  Eurodollar  Rate with
Interest Periods ending on different days,  Borrower shall not have the right to
select the Eurodollar  Rate as the interest rate applicable to any new Revolving
Loan or convert the interest rate applicable to an existing  Revolving Loan from
the Prime Rate to the Eurodollar Rate.

                  (3) A Revolving Loan Notice of Borrowing  shall be irrevocable
and binding on the Borrower. In the case of a Revolving Loan Notice of Borrowing
which specifies a request for a Eurodollar Rate of interest,  the Borrower shall
indemnify the Agent and the Banks against any loss,  reasonable costs or expense
incurred by the Agent  and/or the Banks as a result of any failure to fulfill on
or before the date  specified in the  Revolving  Loan Notice of Borrowing as the
requested  date of the Revolving  Loan the  applicable  conditions  set forth in
Article  III,  including,  without  limitation,  any  loss  (including  loss  of
anticipated  profits),  cost or expense incurred by reason of the liquidation or

<PAGE>

reemployment  of deposits or other funds  acquired by the Agent and/or the Banks
to fund the Revolving Loan when it, as a result of such failure,  is not made on
such date.

                  Section 2.05.  Revolving  Notes.  The Revolving  Loans made by
each Bank and the  Borrower's  obligation to repay the Revolving  Loans shall be
evidenced by, and be payable with interest in accordance with the terms of, this
Agreement and a revolving note of the Borrower payable to the order of that Bank
(collectively,  the "Revolving  Notes").  Each Revolving Note shall (i) be dated
the date hereof,  (ii) be in the original  principal amount equal to that Bank's
Revolving  Loan  Commitment as set forth opposite such Bank's name in Exhibit A,
and (iii) be executed by duly authorized  officers of the Borrower.  Each Bank's
Revolving Note shall be in  substantially  the form of Exhibit B. The failure of
any Bank to make a  Revolving  Loan  shall not  relieve  any  other  Bank of its
obligation to make a Revolving Loan pursuant to the terms and conditions of this
Agreement.  When used in this Agreement, the term "Revolving Note" or "Revolving
Notes"  shall  include  any  extensions,  modifications,  renewals,  refundings,
replacements or restatements thereof.

                  Section  2.06.  Method of  Payment.  Borrower  shall make each
payment under this Agreement and under the Revolving  Notes not later than 12:00
Noon (St.  Louis time) on the date when due in lawful money of the United States
to the Agent by wire transfer of Federal funds. Upon receipt of such payment the
Agent shall immediately remit to each Bank by wire transfer of Federal funds the
amount of the payment  received  which is due each Bank under the Revolving Note
held by each Bank or otherwise under this Agreement.  In the event of receipt of
funds after 12:00 Noon (St. Louis time) on the date of payment,  the funds shall
be deemed to be  received on the next  Business  Day and the accrual of interest
will be  calculated  accordingly.  Whenever  any  payment  to be made under this
Agreement or under a Revolving  Note shall be stated to be due on a day which is
not a Business Day, such payment shall be made on the next  succeeding  Business
Day, the amount of such  payment,  in such case, to include all interest or fees
accrued to the date of actual payment.

                  Section 2.07.  Use of Proceeds.  The proceeds of the Revolving
Loans hereunder shall be used by Borrower to refinance existing indebtedness and
to finance the  acquisition  by Borrower  of banks and thrift  institutions  and
their holding companies. The Borrower will not, directly or indirectly,  use any
part of the  proceeds  of the  Revolving  Loans for the  purpose  of: (i) paying
dividends on or other distributions with respect to capital stock of Borrower or
its  Subsidiaries;  (ii) paying  interest or  principal on  outstanding  debt of
Borrower or its Subsidiaries (other than existing  indebtedness to be refinanced
with the proceeds of the Revolving  Loans); or (iii) purchasing any margin stock
within the  meaning of  Regulation  U of the Board of  Governors  of the Federal
Reserve System.

                  Section  2.08.  Zero  Balance.  The  Banks  and  the  Borrower
acknowledge  that the  outstanding  balance of the  Revolving  Notes may be zero
($00.00) from time to time, and that prior to the Revolving  Credit  Termination
Date such fact shall not mean the Revolving Loan Commitment and the availability
of the  Revolving  Loans  have  been  terminated  nor does it mean the  security
interest has been released.

                  Section 2.09. Advances and Payment.  The Revolving Loans shall
be made by each of the Banks  concurrently.  Each payment and  prepayment of the
Revolving Loans made to the Agent for the account of the Banks shall be made pro
rata on the  basis of each  Bank's  Revolving  Loan  Commitment  as set forth in
Exhibit A. If the Borrower prepays any Revolving Loan or a portion thereof which
is accruing interest based on the Eurodollar Rate, the Borrower shall compensate
the Banks in accordance with Section 10.06(2). Any such prepayment shall be made
upon at least three (3) Business  Days' notice to the Agent stating the proposed
date and aggregate  principal  amount of the  prepayment,  and if such notice is
given,  the Borrower  shall prepay such  principal  amount of the Revolving Loan
together with accrued  interest to the date of such  prepayment on the principal
amount prepaid;  provided,  however, that each partial prepayment shall be in an
aggregate  principal  amount  of not less  than  One  Hundred  Thousand  Dollars
($100,000) and integral  multiples of Fifty Thousand Dollars ($50,000) in excess
thereof,  and provided further,  that a partial  prepayment shall not reduce the

<PAGE>

principal  balance of each Revolving Loan below the minimum levels prescribed in
Section  2.04(1).  In the event more than one Revolving  Loan accruing  interest
based on the Eurodollar Rate is outstanding at the time of any such  prepayment,
the Borrower  shall have the right to specify which such Revolving Loan is to be
prepaid by the Borrower.

                  Section 2.10.  Revolving Loan Commitment  Fee.  Borrower shall
pay to Agent for the  account of the Banks on a pro-rata  basis,  within  twenty
(20)  days from the date of the  Agent's  invoice  therefor,  a  Revolving  Loan
Commitment Fee (the "Revolving  Loan Commitment  Fee") at the rate of one-eighth
of one percent  (0.125%) per annum on the average  daily  unused  portion of the
Revolving Loan  Commitment.  The Revolving Loan  Commitment Fee shall be payable
quarterly in arrears commencing on December 1, 1999 (which payment shall include
the period  commencing on the date hereof),  March 1, 2000,  June 1, 2000 and on
the Revolving Credit  Termination  Date. The Revolving Loan Commitment Fee shall
be  computed  on the basis of a year  deemed to consist of 360 days and paid for
the actual number of days elapsed.

                  Section 2.11.     Reimbursement.

                  Whenever  any Bank  shall  sustain  or  incur  any  losses  or
out-of-pocket expenses in connection with:

                  (1) the failure by the Borrower to pay the principal amount of
any  Revolving  Loan when due (whether at maturity,  by reason of  acceleration,
notice of prepayment/termination by Borrower or otherwise);

                  (2)     the  repayment  of  overdue  amounts  of any Revolving
 Loan; or

                  (3)     the acceleration of the maturity date of an  Revolving
Note by reason of the  occurrence of an Event of Default;

the Borrower shall pay to the Agent,  upon its demand and for the account of the
applicable  Banks,  an amount  certified  in  writing by the Agent as the amount
required  to  reimburse  the  applicable  Banks for all  reasonable  losses  and
out-of-pocket  expenses claimed.  All  determinations,  estimates,  assumptions,
allocations and the like required for the determination thereof shall be made by
the Agent in good faith and the  Borrower  shall have the burden of proving that
the Agent's determination thereof is not correct.

                  Section  2.12.  Failure of Any Bank to Make  Revolving  Loans.
Should any Bank default in making a Revolving Loan, the other Banks shall not be
released  from  their  several  obligations  to make  Revolving  Loans as agreed
hereunder,  and, in the event such defaulting Bank is the Agent, the other Banks
shall forthwith appoint one of themselves to act as Agent. However, such default
shall not obligate any of the Banks to increase their  Revolving Loan Commitment
hereunder.  Borrower shall be released from all liability to pay such defaulting
Bank any  accrued  or future  fees  under  Sections  2.04 and 2.10 and the other
obligations of the Borrower to such  defaulting  Bank under the Loan  Documents,
except the obligation to repay the outstanding  Revolving Loans theretofore made
by such Bank and  interest  accrued  thereon as provided in the Loan  Documents,
shall  terminate;  provided,  however,  once such  default  is cured,  then such
defaulting  Bank  shall,  subsequent  thereto,  have all  rights  under the Loan
Documents.

                  Section  2.13.  Banks Not Required to Extend  Credit.  No Bank
shall be required to make any Revolving  Loan if, after giving  effect  thereto,
the then aggregate  outstanding  principal  amount of all Revolving  Loans would
exceed $100,000,000, as such amount may be reduced from time to time pursuant to
Section  2.02, or such Bank would exceed its Revolving  Loan  Commitment  (after
giving effect to all Revolving  Loans,  whether or not funded by any  particular
Bank, as if each Bank had funded its  respective  Revolving  Loans in accordance
with the terms of this Agreement).

<PAGE>

                                   ARTICLE III
                              CONDITIONS PRECEDENT

                  Section 3.01.  Conditions  Precedent to the Initial Loans. The
obligation  of each Bank to make its initial  Revolving  Loan to the Borrower is
subject to the  conditions  precedent  that the  Agent,  on behalf of the Banks,
shall have  received,  on or before the date  hereof and  approved,  each of the
following:

(1) Notes.  The Revolving Notes duly executed by the Borrower;

(2) Pledge  Agreement.  The Pledge  Agreement,  duly  executed by the  Borrower,
together with (a) acknowledgment copies of the financing statements (Form UCC-1)
duly filed under the Uniform Commercial Code of all jurisdictions  necessary or,
in the opinion of the Agent,  desirable to perfect the security interest created
by the Pledge  Agreement,  and (b) stock powers or powers of attorney  which are
necessary  or  appropriate  for  the  security  interest  of  the  Agent  in the
Collateral;

(3) Evidence of all Corporate Action by the Borrower and Subsidiaries. Certified
(as of the date of this Agreement)  copies of all corporate  action taken by the
Borrower,   including  resolutions  of  the  Board  of  Directors  of  Borrower,
authorizing  the execution,  delivery,  and performance of all Loan Documents to
which  Borrower is a party and each other  document to be  delivered by Borrower
pursuant to this Agreement;

(4) Incumbency Certificates. Certificates dated as of the date of this Agreement
of the Secretary of the Borrower certifying the names and true signatures of the
officers of the Borrower  authorized  to sign the Loan  Documents and each other
document to be delivered by the Borrower under this Agreement;

(5) Opinion of Counsel for the Borrower.  A favorable opinion of counsel for the
Borrower,  in substantially  the form of Exhibit F, and as to such other matters
as the Agent may reasonably request;

(6) Form U-1.  Federal  Reserve   Form  U-1 Purpose   Statements,   executed  by
Borrower;

(7) Stock Certificates. Delivery to Agent of the original stock certificates for
all of the issued and  outstanding  shares of stock of each  Pledged  Subsidiary
(exclusive of directors' qualifying shares), together with stock powers;

(8)  Corporate  Existence.  Certificates  and  certified  copies of charters and
articles of  incorporation  demonstrating  the due organization and current good
standing of Borrower and each Pledged  Subsidiary  and  certified  copies of the
Bylaws of Borrower and each Pledged Subsidiary;

(9) Original Credit Agreement. (a) Each Bank shall have surrendered to Agent the
revolving credit note issued to it pursuant to the Original Credit Agreement and
such  revolving  credit note shall be deemed  amended and restated and converted
into Notes  under this  Agreement,  (b) all loans  outstanding  pursuant  to the
Original  Credit  Agreement  shall be either  (i) repaid in full and if any such
revolving loans were at such time accruing  interest at the Eurodollar Rate, all
breakage costs in connection  therewith  shall have been paid as contemplated by
Section  10.06(2) of the Original Credit  Agreement or (ii) continued under this
Agreement in accordance  with a notice  delivered  pursuant to Section 2.04, (c)
each Bank shall have received  payment in full of all amounts then due and owing
to it under the Original Credit Agreement,  and (d) Borrower shall have paid all
accrued and unpaid interest and fees owing under the Original  Credit  Agreement
through the date hereof;

(10) Financial Statements.   Audited  consolidated  financial statements for the
fiscal years 1997 and 1998 and the unaudited consolidated  financial  statements
as of June 30, 1999, of the Borrower and First Banks America, Inc.;
<PAGE>

(11)  Officer's  Certificate.  A certificate  from the Borrower,  dated the date
hereof,  stating  that there has not  occurred a material  adverse  change since
December  31,  1998,  in the  financial  condition,  operation,  properties,  or
business of the Borrower  and its  Subsidiaries  or in the facts or  information
regarding such entities as represented to the Agent and the Banks to date; and

(12) Additional  Documentation.  Such other approvals,  opinions or documents as
the Agent may reasonably request.

                  Section 3.02. Conditions Precedent to All Revolving Loans. The
obligation  of each Bank to make each  Revolving  Loan  (including  the  initial
Revolving  Loans) shall be subject to the further  conditions  precedent that on
the date of each such Revolving Loan:

                  (1) The Agent shall have received the Revolving Loan Notice of
Borrowing which shall specify whether the requested  Revolving Loan shall accrue
interest based on the Eurodollar Rate or at the Prime Rate;

                  (2) No Default  or  Event of  Default shal  have occurred  and
be  continuing,  or would result from such  Revolving Loan.

                  (3) The  following  statements  shall be true and the Agent on
behalf of the Banks shall have received a Certificate  signed by at least two of
the chief executive officer,  the chief financial officer,  the chief accounting
officer,  the chief  operating  officer and the chief credit officer of Borrower
and dated the date of the  Revolving  Loan Notice of Borrowing  requesting  such
Revolving Loan,  containing the  confirmations of compliance with certain of the
financial covenants as herein provided, and stating that:

                           (a)      The representations and warranties contained
in Article IV of this Agreement are correct on and as of such date;

                           (b)      No Default or Event of Default has  occurred
and is continuing,  or would result from such Revolving Loan;

                           (c)      Attached is an accurate listing  of  all  of
the Affiliates of Borrower; and

                           (d)      The use of  the  proceeds  of  the requested
Revolving Loan will be as indicated in the Revolving Loan Notice of Borrowing.

                  (4) The  Agent  shall  have  received  such  other  approvals,
information  or  documents  as the Agent  may  reasonably  request,  in form and
substance satisfactory to the Agent.

                                   ARTICLE IV.
                         REPRESENTATIONS AND WARRANTIES

                  The Borrower represents and warrants to the Banks that:

                  Section   4.01.   Incorporation,   Good   Standing,   and  Due
Qualification. Borrower is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Missouri and is in good standing
in all  states  and  jurisdictions  wherein it owns  property  or does  business
requiring  such  qualification  as a foreign  corporation.  Borrower  is a "bank
holding company" as that term is defined in the federal Bank Holding Company Act
of 1956,  as amended,  12 U.S.C.  ss. 1841 et seq.,  and as such,  Borrower  has
received all necessary  approvals from and has filed all necessary  reports with
the Board of Governors of the Federal Reserve System.  The list of Affiliates of
Borrower  as shown on  Exhibit  H  attached  is as of the date  hereof  true and
accurate.  Each  Subsidiary of the Borrower is a bank,  bank holding  company or
corporation duly organized and in good standing under the laws of its respective
jurisdiction of organization.
<PAGE>

                  Section 4.02.  Corporate  Power and Authority.  The execution,
delivery and  performance  by the Borrower of the Loan Documents as provided for
herein are within the corporate powers of Borrower, have been duly authorized by
all  necessary  corporate  action and  require no action by or in respect to, or
filing with any governmental body, agency or official.  The execution,  delivery
and  performance  by Borrower of the Loan  Documents  do not conflict  with,  or
result in a  material  breach  of the  terms,  conditions  or  provisions  of or
constitute a default  under or result in any  violation  of, and Borrower is not
now  in  default  under  or in  violation  of  the  terms  of  its  Articles  of
Incorporation or Bylaws or any rule, regulation, order, writ, judgment or decree
of any  court or  government  agency or  instrumentality,  or any  agreement  or
instrument to which Borrower or any of its  Subsidiaries  is a party or by which
it or they are bound or to which it or they are subject.

                  Section 4.03. Legally  Enforceable  Agreement.  This Agreement
has been duly executed and delivered and constitutes a legal,  valid and binding
agreement of the Borrower  enforceable  in  accordance  with its terms,  and the
other Loan  Documents,  when  executed  and  delivered in  accordance  with this
Agreement,  will  constitute  a  legal,  valid  and  binding  obligation  of the
Borrower,   enforceable  in  accordance   with  their  terms,   except  as  such
enforceability  may be limited by  applicable  bankruptcy,  insolvency  or other
similar laws affecting creditors' rights generally.

                  Section 4.04. Financial Statements;  Financial Condition.  The
financial information furnished by Borrower representing the financial condition
of Borrower or any Subsidiary,  such  information  being identified in Exhibit I
attached,  is true and  correct as of the date  furnished  and there has been no
material  adverse change in the financial  condition,  operations or business of
any of them since the date of such financial information.

                  Section  4.05.  Other  Agreements.  Except  for those  matters
disclosed on Schedule 4.05  attached,  Borrower is not a party to any indenture,
loan, or credit  agreement,  or to any lease or other agreement or instrument or
subject to any  charter or  corporate  restriction  which  could  reasonably  be
expected  to  have  a  material  adverse  effect  on  its  financial  condition,
operations,  properties,  or  business,  or on its  ability  to  carry  out  its
obligations  under  the Loan  Documents.  Neither  the  Borrower  nor any of its
Subsidiaries  is  in  default  in  any  material  respect  in  the  performance,
observance,  or fulfillment of any of the obligations,  covenants, or conditions
contained in any agreement or instrument  material to their respective  business
to which each is a party.

                  Section 4.06.  Litigation.  Except for those matters disclosed
on Schedule  4.06  attached,  there is no pending or, to the best of  Borrower's
knowledge,  threatened action or proceeding against or affecting Borrower or any
Subsidiary  before any  court,  governmental  agency,  or  arbitrator,  which if
determined  adversely  to  Borrower in any one case or in the  aggregate,  could
reasonably  be  expected  to have a  material  adverse  affect on the  financial
condition, operations, properties, or business of Borrower or any Subsidiary, or
the ability of Borrower or any Subsidiary to perform its obligations  under this
Agreement or the Loan Documents.

                  Section 4.07. Ownership of Subsidiaries. The ownership of each
Subsidiary is as shown on Exhibit J attached.  Upon the extension of the initial
Revolving Loans, all shares of common stock of each Subsidiary owned by Borrower
will be free and  clear of all  liens,  claims  and  encumbrances,  except as to
Pledged  Subsidiaries  the  security  interests  under the Pledge  Agreement  as
provided for herein.

                  Section  4.08.  ERISA.  Borrower  and each  Subsidiary  are in
compliance  in all material  respects with all  applicable  provisions of ERISA.
Neither a  Reportable  Event nor a  Prohibited  Transaction  has occurred and is
continuing  with  respect  to any Plan;  except as  provided  on  Schedule  4.08
attached,  no notice of intent to  terminate  a Plan has been  filed nor has any
Plan been  terminated;  no circumstances  exist which  constitute  grounds under
Section 4042 of ERISA entitling the PBGC to institute  proceedings to terminate,
or appoint a trustee to administer, a Plan, nor has the PBGC instituted any such

<PAGE>

proceedings;  except as provided on Schedule 4.08 attached, neither Borrower nor
any Subsidiary has completely or partially withdrawn under Sections 4201 or 4204
of ERISA  from a  Multiemployer  Plan;  Borrower  and each  Subsidiary  have met
minimum funding  requirements under ERISA with respect to their respective Plans
and the present fair market value of all Plan assets  exceeds the present  value
of all vested  benefits  under  each  Plan,  as  determined  on the most  recent
valuation  date of the Plan and in accordance  with the  provisions of ERISA and
the regulations  thereunder for calculating  potential  liability to the PBGC or
the Plan under Title IV of ERISA; Borrower and all Subsidiaries have incurred no
liability to the PBGC under ERISA.

                  Section 4.09.  Taxes.  Borrower and each Subsidiary have filed
(or received  extensions of the time to file) and will in the ordinary course of
business file all tax returns  (federal,  state, and local) required to be filed
and have paid and will pay all taxes, assessments,  and governmental charges and
levies shown  thereon to be due,  including  interest and  penalties,  provided,
however,  that  nothing  herein  will  prevent  the contest in good faith of any
assessment  or imposition  of any tax as long as an adverse  determination  will
have no material adverse impact upon Borrower or the Pledged Subsidiaries.

                  Section 4.10. Use of Proceeds; Margin Regulations. Neither the
making  of any Loan  nor the use of the  proceeds  thereof  will  violate  or be
inconsistent  with  the  provisions  of  Regulations  T, U or X of the  Board of
Governors of the Federal Reserve System.

                  Section 4.11. Year 2000  Compliance.  Each of the Borrower and
its Subsidiaries has (a) undertaken a detailed inventory,  review and assessment
of all areas within its business and operations that could be adversely affected
by the failure of Borrower  or such  Subsidiary,  as the case may be, to be Year
2000 Compliant on a timely basis, (b) developed a detailed plan and timeline for
becoming  Year 2000  Compliant on a timely basis,  and (c) to date,  implemented
such plan in accordance with such timetable in all material  respects.  Borrower
reasonably  anticipates  that it and each Subsidiary will be Year 2000 Compliant
on a timely basis,  except to the extent such noncompliance could not reasonably
be  expected  to have a  material  adverse  effect on the  financial  condition,
operations,  properties, or business of the Borrower or any Subsidiary.  Neither
Borrower nor any Subsidiary is aware that any of its key  suppliers,  vendors or
customers  will not, on a timely basis,  be Year 2000  Compliant,  except to the
extent such  noncompliance  could not  reasonably be expected to have a material
adverse effect on the financial condition,  operations,  properties, or business
of the  Borrower or any  Subsidiary.  For purposes of this  Section  4.11,  "key
suppliers,  vendors  and  customers"  refers  to those  suppliers,  vendors  and
customers of Borrower or the  applicable  Subsidiary,  as the case may be, whose
business  failure could reasonably be expected to have a material adverse effect
on the financial condition, operations,  properties, or business of the Borrower
or any Subsidiary.

                                   ARTICLE V.
                              AFFIRMATIVE COVENANTS

                  So long as any portion of the  indebtedness  evidenced  by the
Notes shall remain  unpaid,  or the Banks shall have any  Commitment  under this
Agreement, Borrower and each Pledged Subsidiary will:

                  Section 5.01.  Maintenance  of Existence.  Except as expressly
permitted  pursuant to Section 6.02 hereof,  preserve and maintain its corporate
existence  and good  standing  in the  jurisdiction  of its  incorporation,  and
qualify and remain  qualified as a foreign  corporation in each  jurisdiction in
which such qualification is required.

                  Section 5.02.  Maintenance of Records.  Keep adequate  records
and books of account,  in which complete entries will be made in accordance with
GAAP consistently applied, reflecting all financial transactions.
<PAGE>

                  Section 5.03.  Maintenance of Subsidiaries.  Maintain and keep
each  Subsidiary  in good standing with the  jurisdiction  of its  organization,
except to the extent a  Subsidiary  dissolves  or ceases to exist  pursuant to a
transaction permitted by the terms of Section 6.02.

                  Section 5.04.  Compliance  With Laws.  Comply in all respects,
and cause  compliance on behalf of each  Subsidiary,  with all applicable  laws,
rules,  regulations,  and orders.  Compliance shall include, without limitation,
paying  before  the  same  become   delinquent  all  taxes,   assessments,   and
governmental  charges  imposed  upon it or upon its  property,  except  for such
taxes,  assessments or governmental  charges that are being diligently contested
in good faith by appropriate  proceedings if it has maintained adequate reserves
with  respect   thereto  in  accordance  with  generally   accepted   accounting
principles.

                  Section 5.05.  Right of Inspection.  At any time during normal
business  hours and from  time to time,  upon at least  one (1)  Business  Day's
advance  notice,  permit  the Agent and any Bank or any agent or  representative
thereof to examine and make copies of and  abstracts  from the records and books
of account of and visit the properties of, Borrower and each Subsidiary,  and to
discuss the affairs,  finances,  and  accounts of Borrower and each  Subsidiary,
with  any of its or  their  officers  and  directors  and  with  the  Borrower's
independent  accountants,  provided,  however, that with respect to the loans of
Borrower  or a Pledged  Subsidiary,  the Agent and any Bank may only  review and
make copies of  summaries  of the Watch List  prepared on a quarterly  basis and
loan audit reports; review of specific loan accounts and loan review reports may
be requested by the Agent or any Bank,  whereupon Borrower and Agent or the Bank
shall  within ten (10) days agree as to the number of such  accounts and reports
that are reasonable and appropriate to review,  and provided further,  that upon
and during the  existence  of an Event of Default  hereunder,  there shall be no
restrictions  or  conditions  on  the  scope  of  the  review,   inspection  and
reproduction rights of Agent and the Banks concerning the loans of Borrower or a
Pledged Subsidiary.

                  Section 5.06.    Reporting Requirements. Furnish to the Agent:

                  (1) Quarterly Financial Statements. As soon as practicable, or
in any event within forty-five (45) days after the end of each fiscal quarter of
Borrower  (a) parent only and  consolidated  balance  sheets of Borrower and its
Subsidiaries  as of the end of such  fiscal  quarter  and (b)  parent  only  and
consolidated  statements  of income and  earnings  retained  in the  business of
Borrower and its  Subsidiaries  for such fiscal  quarter,  all of which shall be
prepared in accordance  with GAAP (subject to normal year-end  adjustments)  and
certified  by the  chief  financial  officer  or  chief  accounting  officer  of
Borrower.

                  (2) Annual Financial Statements. As soon as practicable, or in
any event  within  ninety  (90) days  after  the  close of each  fiscal  year of
Borrower  (a) parent only and  consolidated  balance  sheets of Borrower and its
subsidiaries  at year end and (b) parent  only and  consolidated  statements  of
income and earnings  retained in the  business of Borrower and its  Subsidiaries
including  consolidated  and parent only statements of cash flow for such fiscal
year, all of which shall include  comparative  statements for the preceding year
and shall be prepared in accordance with GAAP consistently applied, and shall be
certified  by, and  accompanied  by an  unqualified  audit  opinion of a firm of
certified public accountants  acceptable to Agent;  provided,  however, that the
opinion may be limited to the consolidated statements of Borrower.

                  (3) Reports.  Within forty-five (45) days after such report is
filed and to the extent not  prohibited  by law,  copies of all reports filed by
Borrower (on a  consolidated  and parent only basis),  and First Banks  America,
Inc.  (on a  consolidated  and parent only basis) with the Board of Governors of
the Federal  Reserve  System or any Federal  Reserve Bank,  the Federal  Deposit
Insurance Corporation  ("FDIC"),  Securities and Exchange Commission ("SEC"), or
other bank or thrift  regulatory  agency;  within forty-five (45) days after the
end of each fiscal quarter of Borrower, a list of all such reports. Irrespective
of the  foregoing  procedures  for the request  for copies of reports,  Borrower

<PAGE>

shall  submit  to the  Agent,  within  forty-five  (45)  days  from  the date of
submission  to the SEC,  copies of the following SEC reports with respect to the
Borrower and First Banks America, Inc.: 10-K, 10-Q, and 8-K. Borrower shall also
submit (or cause to be  submitted) to the Agent,  within  fifteen (15) days from
the date of such  agreement,  copies of any and all  agreements  entered into by
Borrower or any of  Borrower's  Subsidiaries  with the Board of Governors of the
Federal  Reserve  System,  any Federal Reserve Bank, the FDIC, the SEC, or other
bank or thrift regulatory agency.

                  (4)  Subsidiary  Reports.  Copies of all Quarterly  Reports of
Condition and Income  ("Call  Report"),  certified as required by law,  filed by
each  Subsidiary with the FDIC or any other  governmental or regulatory  agency,
within  forty-five  (45) days from the date any such Call Report is submitted to
such  agency,  and, to the extent  permitted by law,  copies of all  examination
reports and supervisory comment letters pertaining to each Subsidiary.

                  (5) Examination;  Litigation.  Promptly after the commencement
thereof,  notice of all suits and  proceedings  before any court or governmental
department,  commission,  board, or agency affecting  Borrower or any Subsidiary
which could  reasonably  be expected  to have a material  adverse  effect on the
financial  condition,  properties or  operations of Borrower or any  Subsidiary;
promptly after the receipt thereof,  notice of any report or comment letter from
any regulatory authority of Borrower or any Subsidiary,  or from the independent
auditors of Borrower,  which requires any action of a material adverse nature by
Borrower or any Subsidiary.

                  (6) Compliance Certificate.  Within forty-five (45) days after
the end of each fiscal quarter of Borrower,  a Compliance  Certificate signed by
at least two of the chief executive officer,  the chief financial  officer,  the
chief  accounting  officer  and  the  chief  credit  officer  of  the  Borrower,
substantially in the form of Exhibit E attached hereto.

                  (7) Other  Information.  Such other  information  and  reports
regarding the financial condition,  operations or regulatory affairs of Borrower
or any Subsidiary as Agent or a Bank may from time to time reasonably request.

                  Section  5.07.  Operations.  Operate and maintain its business
and property, and those of its Subsidiaries, in the ordinary course in a prudent
manner  consistent  with sound  banking  practices and in such a manner that the
performance  by Borrower of its  obligations  hereunder are not  jeopardized  or
impaired.

                  Section 5.08.  Additional  Collateral.  Pursuant to the Pledge
Agreement,  pledge and  deliver to Agent  shares of stock of (i) a bank,  thrift
institution,  bank holding company or savings holding company hereafter acquired
by Borrower or any  Pledged  Subsidiary  (other than as may be acquired by First
Banks  America,  Inc.) with all or a portion of such shares having been acquired
with the proceeds of a Loan, or (ii) a bank,  thrift  institution,  bank holding
company or savings holding company which becomes a Subsidiary (other than as may
be acquired by First Banks America, Inc.).

                  Section 5.09 Year 2000 Compliance.  Borrower will, and it will
cause each  Subsidiary  to,  take any and all actions  necessary  to assure that
Borrower and each  Subsidiary  will be Year 2000 Compliant as soon as reasonably
practical,  except to the extent  such  noncompliance  could not  reasonably  be
expected  to  have  a  material  adverse  effect  on  the  financial  condition,
operations,  properties, or business of the Borrower or any Subsidiary. Borrower
will be, and it will cause each Subsidiary to be, Year 2000 Compliant by January
1,  2000,  except to the  extent  such  noncompliance  could not  reasonably  be
expected  to  have  a  material  adverse  effect  on  the  financial  condition,
operations,  properties,  or business of the Borrower or any Subsidiary.  At the
request of Agent,  Borrower  will from time to time  provide  Agent with written
reports in form and detail reasonably satisfactory to Agent on the status of the
efforts of Borrower and its Subsidiaries to be Year 2000 Compliant.
<PAGE>


                                   ARTICLE VI.
                               NEGATIVE COVENANTS

                  So long as any portion of the  indebtedness  evidenced  by the
Notes shall  remain  unpaid,  or any Bank shall have any  Commitment  under this
Agreement,  Borrower will not,  without the prior written  consent of the Agent,
which consent shall not be unreasonably withheld:

                  Section  6.01.  Liens.  Create,  incur,  assume,  or suffer to
exist, any Lien, or permit any Subsidiary to create, incur, assume, or suffer to
exist,  any lien,  upon or with respect to any of the  Collateral or any capital
stock held by any Subsidiary, except in favor of the Agent.

                  Section 6.02.  Mergers,  Etc.  Merge or  consolidate  with any
Person  having Total Assets in excess of  $250,000,000  or which is subject to a
regulatory  action or  proceeding or any cease and desist order which relates in
any material adverse way to the management,  financial condition,  or operations
of such Person, or permit the merger or consolidation of any Subsidiary with any
Person  having Total Assets in excess of  $250,000,000  or which is subject to a
regulatory  action or  proceeding or any cease and desist order which relates in
any material adverse way to the management,  financial condition,  or operations
of such Person, or sell, assign,  lease, or otherwise dispose of (whether in one
transaction  or  in  a  series  of  transactions)   any  Subsidiary  or  all  or
substantially all of its other assets, or permit the sale, assignment, lease, or
other disposition of any Subsidiary,  or the sale of all or substantially all of
the assets of any Subsidiary (whether now owned or hereafter  acquired),  to any
Person;  provided,  however,  that nothing in this  Section  6.02 shall  prevent
mergers or sale of assets as between two entities that are Pledged Subsidiaries.

                  Section 6.03. Indebtedness.  Incur, create, assume or allow to
exist, nor permit any Subsidiary to incur, create, assume or allow to exist, any
indebtedness, whether contingent or absolute, except indebtedness: (i) evidenced
by the  Notes;  (ii)  evidenced  by  subordinated  debentures  issued  to  First
Preferred  Capital  Trust  in  an  aggregate  principal  amount  not  to  exceed
$88,917,550;  (iii) evidenced by subordinated  debentures  issued by First Banks
America,  Inc. to First America Capital Trust in an aggregate  principal  amount
not to exceed $47,422,700;  (iv) for advances made by Borrower or any Subsidiary
to  Borrower  or any  Subsidiary  in the  ordinary  course  of  business  or for
acquisition  purposes in an aggregate amount not to exceed  $20,000,000;  (v) of
accrued  expenses or accounts payable in the ordinary course of business not yet
payable; (vi) for any other purpose not to exceed in the aggregate the amount of
$2,500,000;  and  (vii)  refundings,  renewals  and  replacements  of any of the
foregoing.

                  Section 6.04.  Dividends.  Pay or declare any dividends on the
common stock of Borrower;  pay or declare any dividends upon the preferred stock
of Borrower  designated  as Class A or Class B preferred  stock in the financial
statements  of Borrower if a Default or an Event of Default  exists or if, after
giving effect thereto, a Default or Event of Default would exist.

                  Section  6.05.  Stock  Issue;  Additional  Issue  of  Stock of
Subsidiary.  Create  any new class or amend the terms of any  existing  class of
stock of Borrower,  or issue any shares of stock of any class of  Borrower,  the
terms of which  have not been  approved  by the  Agent;  except for stock now or
hereafter issued by First Banks America,  Inc. for acquisition purposes and upon
exercise  of stock  options  granted to  employees,  none of which  shall  cause
Borrower to own, in the aggregate,  less than 55% of the issued and  outstanding
shares of voting capital stock of First Banks America, Inc., issue or permit any
Subsidiary to issue any  additional  shares of stock of any class or any capital
notes or other long-term debt  instruments,  or create any new class of stock or
amend the terms of any existing class of stock.

                  Section 6.06. Stock Redemption. Redeem, purchase or retire any
shares of any existing  class of stock of Borrower  (except for trust  preferred
securities  issued  by First  America  Capital  Trust) or any  capital  notes of
Borrower or permit any  Subsidiary  to redeem,  purchase or retire any shares of
any  existing  class of stock of such  Subsidiary  or any capital  notes of such
Subsidiary;  provided,  however,  that as long as no Event of Default shall have

<PAGE>

occurred and be continuing,  with respect to  Subsidiaries  which are not wholly
owned by the  Borrower,  such  Subsidiary(ies)  may  redeem,  purchase or retire
shares of any existing class of stock (except for trust preferred securities) of
such Subsidiary.

                  Section 6.07. Loans. Loan money or extend credit to, or become
a surety or guarantor for, or permit any Pledged Subsidiary to do likewise,  the
benefit  of  any  Affiliate  or  any  Subsidiary  or any  executive  officer  or
shareholder of any Affiliate or any Subsidiary; provided, however, that Borrower
and the  Pledged  Subsidiaries  may  extend  credit  to  executive  officers  or
shareholders  of any  Affiliate or Subsidiary if the loan or extension of credit
complies in all  respects  with  applicable  law and  regulations,  and provided
further,  that the following items of indebtedness  are permitted:  (i) loans to
Subsidiaries  for the purpose of  acquiring  and holding OREO  properties,  (ii)
loans by Borrower or any  Subsidiary to Borrower or any  Subsidiary  made in the
ordinary course of business or for acquisition  purposes in an aggregate  amount
not to exceed at any one time $20,000,000;  and (iii)  refundings,  renewals and
replacements of any of the foregoing.

                  Section  6.08.  Redeem in whole or in part,  the  subordinated
debentures  issued  to First  Preferred  Capital  Trust or  permit  First  Banks
America, Inc. to redeem, in whole or in part, the subordinated debentures issued
to First  America  Capital  Trust;  pay any  interest  on or permit  First Banks
America,  Inc. to pay any interest on such subordinated  debentures if a Default
or Event of Default  exists,  or if after giving  effect  thereto,  a Default or
Event of Default would exist.

                  Section 6.09. Continuation of Business.  Substantially change,
nor permit any of its  Subsidiaries to change  substantially,  the nature of the
respective  businesses in which they are now engaged,  nor engage in, nor permit
any Subsidiary to engage in, any line of business if, as a result  thereof,  the
business of the Borrower and its  Subsidiaries,  taken as a whole,  would not be
predominately  the banking or thrift  business (and  activities  deemed  closely
related  to  banking  and/or  the  thrift  business  by  applicable   regulatory
authorities) as currently constituted as of the date hereof.

                                  ARTICLE VII.
                               FINANCIAL COVENANTS

                  So long as any portion of the  indebtedness  evidenced  by the
Notes  shall  remain  unpaid or any Bank  shall have any  Commitment  under this
Agreement,  Borrower and the Pledged  Subsidiaries  will comply with each of the
following covenants:

                  Section 7.01.   Tier  I   Leverage     Ratio.   Borrower   and
Subsidiaries,  on a consolidated basis, shall maintain a minimum Tier I Leverage
Ratio at the end of each  quarterly  accounting  period of not less than 5.0% or
such greater amount as may be required to be considered  "well  capitalized"  by
applicable regulatory authorities from time to time.

                  Section 7.02. Tier I Leverage Ratio of Subsidiaries. Each bank
Subsidiary of Borrower shall maintain a minimum Tier I Leverage Ratio at the end
of each quarterly accounting period of not less than 5.0% or such greater amount
as may be required to be considered "well capitalized" by applicable  regulatory
authorities from time to time.

                  Section  7.03.  Tier I Risk  Based  Capital  Ratio.  Each bank
Subsidiary of Borrower  shall maintain a minimum Tier I Risk Based Capital Ratio
at the end of each  quarterly  accounting  period  of not less than 6.0% or such
greater  amount  as may be  required  to be  considered  "well  capitalized"  by
applicable regulatory authorities from time to time.

                  Section  7.04.  Total  Risk  Based  Capital  Ratio.  Each bank
Subsidiary of Borrower  shall  maintain a minimum Total Risk Based Capital Ratio
at the end of each  quarterly  accounting  period of not less than 10.0% or such
greater  amount  as may be  required  to be  considered  "well  capitalized"  by
applicable regulatory authorities from time to time.
<PAGE>

                  Section 7.05. Loan Loss Reserve. Borrower and Subsidiaries, on
a consolidated basis, shall maintain a minimum Loan Loss Reserve, expressed as a
percentage of Total Loans, for each quarterly accounting period of 1.25% or such
greater amount as may be required by regulatory  authorities or prudent  banking
standards from time to time.

                  Section 7.06.     Net Income to Average Total Assets.

                           (a)      Borrower and Subsidiaries, on a consolidated
basis, shall maintain a minimum ratio, expressed as a percentage,  of Net Income
less extraordinary  and/or non-recurring items (as determined in accordance with
GAAP),  for the most recently ended period of four fiscal  quarters of Borrower,
to Average Total Assets of not less than 0.70%.

                           (b) First Bank and First Bank & Trust,  on a combined
basis, shall maintain a minimum ratio, expressed
as a percentage, of Net Income less extraordinary and/or non-recurring items (as
determined in accordance with GAAP),  for the most recently ended period of four
calendar quarters, to Average Total Assets of not less than 0.70%.

                  Section 7.07.     Non-Performing    Assets.    Borrower    and
Subsidiaries,   on  a  consolidated   basis,  shall  have Non-performing Assets,
in the aggregate, of not more than 25% of Primary Capital.

                                  ARTICLE VIII.
                                EVENTS OF DEFAULT

                  Section 8.01.     Events of Default.  If any  of the following
events ("Events of Default") shall occur:

                  (1)  Borrower  shall  fail  to pay (a) the  principal  of,  or
interest on, a Note,  within five (5) calendar days after notice of such failure
shall have been given to the Borrower by the Agent;

                  (2)  Borrower  shall fail to pay any fees or any other  amount
payable hereunder when due and such failure shall remain unremedied for ten (10)
consecutive  calendar days after notice of such failure shall have been given to
the Borrower by the Agent;

                  (3) Any  representation or warranty made or deemed made by the
Borrower  or any  Subsidiary  in  this  Agreement,  the  Pledge  Agreement,  the
Subsidiary  Pledge  Agreements,  or  which  is  contained  in  any  certificate,
document,  opinion,  or financial or other statement furnished at any time under
or in connection with any Loan Document,  shall be reasonably  determined by the
Agent to have been  incorrect in any material  respect on or as of the date made
or deemed made and such default remains  unremedied for thirty (30)  consecutive
calendar days after notice  thereof shall have been given to the Borrower by the
Agent;

                  (4) (a)  Borrower  shall fail to perform or observe  any term,
covenant,  or agreement  contained in any Loan Document (other than as contained
in Article VII hereof and other than as  contained  in a Note) on its part to be
performed or observed,  and such failure shall remain unremedied for thirty (30)
consecutive  calendar  days after  notice  thereof  shall have been given to the
Borrower  by the Agent,  provided,  however,  that in the event two or more such
notices are required to be given in any consecutive  six month period,  Agent at
its option need not give such notice,  and there shall not be any period for the
cure of such failure with respect to such second or succeeding  failure,  or (b)
Borrower  shall  fail to perform or observe  any term,  covenant,  or  agreement
contained in Article VII hereof or in a Note;

                  (5) Borrower or any  Subsidiary  (a) shall  generally  not, or
shall be unable to, or shall admit in writing its inability to, pay its debts as
such debts  become  due;  or (b) shall make an  assignment  for the  benefits of
creditors, petition or apply to any tribunal for the appointment of a custodian,

<PAGE>

receiver,  or trustee for it or a substantial  part of its assets;  or (c) shall
commence any  proceedings  under any  bankruptcy,  reorganization,  arrangement,
readjustment  of  debt,  dissolution,  or  liquidation  law  or  statute  of any
jurisdiction,  whether now or  hereafter  in effect;  or (d) shall have any such
petition or application  filed or any such proceeding  commenced  against it, in
which an order for relief is entered or  adjudication or appointment is made and
which remains undismissed for a period of forty-five (45) calendar days or more;
or (e) by any act or omission  shall  indicate  its consent to,  approval of, or
acquiescence  in any such petition,  application,  or  proceeding,  or order for
relief, or the appointment of a custodian,  receiver,  or trustee for all or any
substantial part of its properties;  or (f) shall suffer any such custodianship,
receivership or trusteeship to continue  undischarged for a period of forty-five
(45) calendar days or more;

                  (6) One or more judgments,  decrees, or orders for the payment
of money in excess of Two Million Dollars ($2,000,000) in the aggregate shall be
rendered against  Borrower or any Subsidiary,  and such judgments,  decrees,  or
orders  shall  continue  unsatisfied  and in effect for a period of thirty  (30)
consecutive  calendar  days without being  vacated,  discharged,  satisfied,  or
stayed or bonded pending appeal;

                  (7) The Pledge Agreement shall at any time after its execution
and  delivery  and for any reason  (other than by the action of the Agent) cease
(a) to create a valid and perfected Lien in and to the property  purported to be
subject thereto, of the priority represented therein, or (b) to be in full force
and effect or shall be declared null and void, or the validity or enforceability
thereof  shall be  contested by Borrower or any  Subsidiary,  or Borrower or any
Pledged Subsidiary,  as applicable,  shall deny or disclaim further liability or
obligation  thereunder,  or  Borrower or any  Pledged  Subsidiary  shall fail to
perform  any  of  its  obligations  thereunder,   and  solely  with  respect  to
performance  of  obligations  by the  Borrower  or any  Pledged  Subsidiary,  as
applicable,  under the Pledge  Agreement,  such default  remains  unremedied for
thirty (30) consecutive calendar days after notice thereof shall have been given
to the Borrower by the Agent (the other events described in this Section 8.01(7)
shall become Events of Default immediately upon occurrence without notice to the
Borrower);

                  (8) Any of the following events occur or exist with respect to
Borrower or any Subsidiary:  (a) any Prohibited  Transaction involving any Plan;
(b) any Reportable  Event with Respect to any Plan; (c) the filing under Section
4041 of ERISA of a notice of intent to terminate any Plan or the  termination of
any Plan; (d) any event or circumstance that might constitute  grounds entitling
the  PBGC  to  institute  proceedings  under  Section  4042  of  ERISA  for  the
termination of, or for the appointment of a trustee to administer,  any Plan, or
the  institution  by the PBGC of any such  proceedings;  (e) complete or partial
withdrawal under Section 4201 or 4204 of ERISA from a Multiemployer  Plan or the
reorganization, insolvency or termination of any Multiemployer Plan; and in each
case  above,  such  event or  condition,  together  with  all  other  events  or
conditions, if any, subjects the Borrower or any Subsidiary to any tax, penalty,
or other liability to a Plan, a  Multiemployer  Plan, the PBGC, or otherwise (or
any combination thereof) which in the aggregate exceed or may exceed Two Million
Dollars ($2,000,000);

                  (9) If James F.  Dierberg  and/or Mary W.  Dierberg  (together
with any trust or  partnership  or other  entity over which he or she has voting
control)  cease to own in the  aggregate  at least 51% of the  voting  shares of
stock of First Banks, Inc.;

                  (10) Except for those matters disclosed on Schedule  8.01(10),
if any  regulatory  action or proceeding  shall be  commenced,  or any cease and
desist  order shall be entered  into,  between  any state or federal  regulatory
authority and Borrower or any Subsidiary  which relates in any material  adverse
way to the management or operations of Borrower or any Subsidiary;

                  (11) A default  or an event of default  exists or is  declared
under  the  terms  of (i)  any  indebtedness  aggregating  Two  Million  Dollars
($2,000,000)  or more of the  Borrower  or any  Subsidiary,  or (ii)  any  other
material  agreements of the Borrower or any Subsidiary that involves a potential
aggregate liability of at least Two Million Dollars  ($2,000,000) or which could
be  reasonably  expected  to have a  material  adverse  effect on the  financial
condition,   operations,   properties,  or  business  of  the  Borrower  or  any
Subsidiary,  and which in any such case continues  beyond any applicable  notice
and cure period; or
<PAGE>

                  (12) The Borrower shall fail to   have   positive  Net  Income
for any two consecutive fiscal quarters;

then,  in any  such  event  Agent  shall  at the  request  of the  Majority  (as
hereinafter  defined) declare the Banks'  obligations to make Revolving Loans to
be terminated,  whereupon the same shall  forthwith  terminate,  and declare the
outstanding  Notes,  all interest  thereon,  and all other amounts payable under
this Agreement to be forthwith due and payable in full, whereupon the Notes, all
such  interest,  and all such  amounts  shall  become and be  forthwith  due and
payable,  without presentment,  demand,  protest, or further notice of any kind,
all of which are hereby expressly waived by the Borrower;  provided, that in the
case of any of the Events of Default specified in subsection (5) above,  without
any  notice to the  Borrower  or any other  act by the Agent or the  Banks,  the
Banks' obligations to make Revolving Loans shall be automatically terminated and
the Notes,  all  interest  thereon,  and all other  amounts  payable  under this
Agreement  shall be  forthwith  due and  payable in full,  without  presentment,
demand,  protest,  or  further  notice  of any  kind,  all of which  are  hereby
expressly waived by the Borrower.

                                   ARTICLE IX.
                     AUTHORITY AND RESPONSIBILITIES OF AGENT

                  Section  9.01.  Grant of  Authority.  Each of the Banks hereby
irrevocably appoints and authorizes Mercantile Bank National Association, as the
Agent under this Agreement and each other Loan Document,  on its behalf, to take
such action and exercise  such powers under this  Agreement  and each other Loan
Document  as are  specifically  delegated  to the  Agent by the  terms  thereof,
together with such other powers as are reasonably  incidental thereto. The Agent
shall have no duty to exercise any right or power or remedy hereunder or to take
any affirmative  action  hereunder  unless directed to do so by the Majority (as
hereafter  defined).  For purposes of this Agreement,  the term "Majority" shall
mean the Banks holding at least sixty-six  percent (66%) in dollar amount of the
Commitment.

                  Section 9.02. Action upon  Indemnification  Instructions.  The
Agent  shall  in all  cases  be fully  justified  and  protected  in  acting  or
continuing,  failing or refusing to take any action hereunder or under any other
Loan Document  upon the written  instructions  signed by the Majority,  and such
instructions and any action taken or any failure to act pursuant hereto shall be
binding  on all of the  Banks,  all  holders  of the Notes and their  respective
successors and assigns.

                  Section   9.03.   Reports;   Responsibility   of  the   Agent;
Disclaimer.  Promptly upon the receipt  thereof from the  Borrower,  Agent shall
photocopy  and forward to each Bank each  report,  statement  and other  written
information  received  by Agent  pursuant  to the terms of Section  5.06 of this
Agreement.  Neither  the Agent nor any of its  respective  directors,  officers,
agents,  employees,  attorneys-in-fact  or  affiliates  shall be liable  for any
action taken or omitted to be taken under or in connection  with this  Agreement
or any other Loan Document,  except for its or their willful misconduct or gross
negligence. Without limiting the generality of the foregoing, the Agent:

                  (1) shall not be  responsible  to any Bank for any  statement,
representation  or  warranty  made by any Bank other  than Agent or any  officer
thereof under or in connection with this Agreement or any other Loan Document or
the transactions contemplated hereby;

                  (2)  shall  not  be   responsible   for  the  due   execution,
effectiveness,  validity,  enforceability or sufficiency of this Agreement,  the
Notes,  the Pledge  Agreement,  the  Subsidiary  Pledge  Agreements or any other
document or instrument furnished pursuant hereto or in connection herewith;

                  (3)  shall  not be bound to  ascertain  or  inquire  as to the
performance or observance of any of the terms,  provisions or conditions of this
Agreement  or any  other  Loan  Document  on the  part  of the  Borrower  or any
Subsidiary  or as to the  business,  operation,  property,  assets or  condition
(financial or otherwise) of the Borrower or its Subsidiaries;
<PAGE>

                  (4) shall be  entitled  to rely upon any  writing,  statement,
notice or any telegraph,  telex,  teletype or telecopy  message or any telephone
conversation  believed by it to be genuine  and correct  and, in the case of any
writing, to have been signed or sent by the proper person;

                  (5) may consult with counsel and  independent  accountants and
other experts  selected by the Agent and shall be fully  protected in any action
taken or omitted  to be taken in  accordance  with the  advice of such  counsel,
independent accountants or other experts;

                  (6) may employ agents and  attorneys-in-fact  and shall not be
liable  for the  default,  negligence  or  misconduct  of any  such  agents  and
attorneys-in-fact selected by the Agent with reasonable care;

                  (7) may treat the payee of a Note as the holder  thereof until
it receives  written notice of the assignment or transfer thereof signed by such
payee and in form  satisfactory to the Agent. Any request,  authority or consent
of any person who at such time is the holder of any Note shall be conclusive and
binding on any  subsequent  holder,  transferee or assignee of such Note or Note
issued in exchange therefor; and

                  (8) shall have no liability or  responsibility to Borrower for
any failure on the part of any Bank to comply with an  obligation on its part to
be performed under this Agreement.

                  Section 9.04. Correction of Errors. If the Agent shall pay any
amount to any Bank pursuant  hereto in the belief or expectation  that a related
payment  has  been or  will be  received  or  collected  from  the  Borrower  in
connection  with any Loan and such related  payment is not actually  received or
collected  by the Agent  then such Bank will  promptly,  on demand by the Agent,
return such amount to the Agent,  together with interest  thereon at the Federal
Funds Rate for overnight deposits.

                  Section 9.05.  Expenses;  Indemnification.  To the extent that
the Borrower fails to do so, each Bank, and each subsequent  holder of a Note by
its acceptance thereof,  agrees to reimburse the Agent upon demand in proportion
to the  unpaid  principal  amount of its  Notes,  or if no Notes are at the time
outstanding  in  proportion  to the  Commitments,  and to indemnify and hold the
Agent and its  directors,  officers,  employees  and agents in their  respective
capacities harmless in such proportion against any and all losses,  liabilities,
damages, demand, judgment, claim,  counterclaim,  set-off, cost, disbursement or
expenses  of any  kind  whatsoever  (including  reasonable  attorney's  fees and
expenses) incurred by or asserted against the Agent or its directors,  officers,
employees  and agents under or in connection  with any of the foregoing  arising
out of or in  connection  with  this  Agreement,  the  Notes or any  other  Loan
Documents, the transactions contemplated hereunder, the enforcement,  collection
or  realization  of any  thereof  or any  action  taken or omitted by the Agent,
provided that no Bank shall be liable for any portion of the foregoing  incurred
by the Agent as a result of its  willful  misconduct  or gross  negligence.  The
agreements in this Section 9.05 shall  survive the payment of the Loans,  or any
other amounts  payable  hereunder or under the Notes and the  termination of the
Commitments.

                  Section  9.06.  Rights as Bank.  With respect to its Loans and
the Notes  issued  to it,  the  Agent  shall  have the same  rights  and  powers
hereunder as any Bank and may exercise the same as though it were not the Agent,
and the term  "Bank"  or  "Banks"  shall  include  the  Agent in its  individual
capacity.  The Agent and any of its  affiliates may accept  deposits from,  lend
money to, and generally  engage in any kind of banking or trust  business  with,
the Borrower and any  affiliates as if it were not the Agent and may accept fees
and other  consideration  from the Borrower for services in connection with this
Agreement and otherwise without having to account for the same to the Banks.

                  Section 9.07. Representation of Each Bank. Each Bank expressly
acknowledges that the Agent has not made any representations or warranties to it
and that no action  taken or  hereafter  taken by the  Agent  shall be deemed to

<PAGE>

constitute  a  representation  or warranty by the Agent to any other Bank.  Each
Bank  represents and warrants to the Agent that it has made and will continue to
make  its  own  independent   investigation  of  the  condition  (financial  and
otherwise) and affairs of the Borrower and the  Subsidiaries  in connection with
this Agreement and the Notes without reliance on the Agent or on any information
or  documents  prepared  by the Agent.  Except for  notices,  reports  and other
documents  expressly  required  to be  furnished  to  the  Banks  by  the  Agent
hereunder,  the Agent shall not have any duty or  responsibility  to provide any
Bank  or  any  of  its  respective  officers,   directors,   employees,  agents,
attorneys-in-fact   or  affiliates  any  other   information  or   documentation
pertaining  to  Borrower,   the  Subsidiaries,   or  their  financial   affairs.
Notwithstanding  any provision to the contrary elsewhere in this Agreement,  the
Agent shall not have any duties or responsibilities,  except those expressly set
forth  herein,  or any  fiduciary  relationship  with any Bank,  and no  implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or otherwise exist against the Agent.

                  Section  9.08.  Rights to Resign;  Appointment  of a Successor
Agent.  The Agent may resign as such at any time upon thirty (30) calendar days'
notice to the Borrower and the Banks. In such event,  the Majority shall appoint
a  successor  Agent  which  shall  be an  incorporated  bank or  trust  company,
provided,  however,  that if there is no Default or Event of Default at the time
of such  appointment  and provided  further the successor  Agent is to be a bank
other than Harris  Trust and Savings  Bank,  Norwest  Bank  Minnesota,  National
Association,  American National Bank and Trust Company of Chicago,  or The Frost
National  Bank,  the Agent  shall send to  Borrower a list of at least three (3)
banks which are  satisfactory  to the Majority to serve as the successor  Agent,
whereupon  the Borrower  shall have three (3)  Business  Days in which to select
which bank on the list is to be the successor Agent. In the event of the failure
of the  Borrower  to select a bank from the  list,  then the right of  selection
granted to the Borrower  hereunder  shall forever lapse.  If no successor  shall
have been so appointed  and accepted  such  appointment  within thirty (30) days
after the retiring  Agent's  giving of notice of  resignation  or the Majority's
removal of the retiring  Agent,  then the  retiring  Agent may, on behalf of the
Banks,  appoint a successor,  which shall be a Bank, or, if no such Bank accepts
such  appointment,  which shall be a bank or trust company with an office (or an
affiliate with an office) in St. Louis, Missouri,  having a combined capital and
surplus of not less than One Hundred  Million Dollars  ($100,000,000).  Upon the
acceptance of any  appointment  as Agent  hereunder by a successor  Agent,  such
successor  shall  thereupon  succeed to and become  vested  with all the rights,
powers,  privileges  and duties of the retiring  Agent,  and the retiring  Agent
shall be  discharged  from its  duties  and  obligations  hereunder.  After  any
retiring  Agent's  resignation or removal  hereunder as Agent, the provisions of
this  Article  IX shall  continue  in effect  for its  benefit in respect of any
actions taken or omitted to be taken by it while it was acting as Agent.

                  Section 9.09. Notice of Default. The Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder  unless  the Agent has  received  notice  from a Bank or the  Borrower
referring to this Agreement, describing such Default or Event of Default and, in
the case of any  Default or Event of  Default  other  than  those  described  in
Section  8.01 of this  Agreement,  stating  that such  notice  is a  "notice  of
default." In the event that the Agent  receives such a notice of the  occurrence
of a Default or Event of Default,  the Agent shall give prompt notice thereof to
the Banks.  The Agent  shall take such action  with  respect to such  Default or
Event of Default as shall be reasonably directed by the Majority,  provided that
unless and until the Agent shall have  received such  directions,  the Agent may
(but shall not be obligated  to) take such  action,  or refrain from taking such
action,  with  respect  to such  Default  or Event of  Default  as it shall deem
advisable in the best interests of the Banks.

                  Section 9.10.  Agent  Compensation.  For its services as Agent
hereunder, Borrower shall pay to Agent on the date of this Agreement and on each
anniversary  date thereof,  certain  compensation  as heretofore  agreed between
Agent and Borrower.
<PAGE>

                                    ARTICLE X
                                  MISCELLANEOUS

                  Section 10.01.  Capital Adequacy  Reimbursement.  If after the
date  hereof,  the Agent  shall be  advised  that or shall  determine  that with
respect to any of the Banks the adoption or the taking effect of any  applicable
law, rule or regulation  regarding capital adequacy,  or any change therein,  or
any change in the  interpretation or administration  thereof by any governmental
authority, central bank or comparable agency or compliance by the Banks with any
request or directive regarding capital adequacy (whether or not having the force
of law) of any such  authority,  central bank or  comparable  authority,  has or
would have the effect of reducing the rate of return on or  increasing  the cost
of  maintaining  all of the  Banks'  capital  as a direct  consequence  of their
obligations  hereunder  (taking  into  consideration  the Banks'  policies  with
respect  to  capital  adequacy)  then from  time to time,  within  fifteen  (15)
calendar days after demand by Agent, Borrower shall pay to Agent such additional
amount or amounts as will  compensate  the Banks for such reduction or increase.
In the event any such compensation is demanded,  Agent shall provide to Borrower
a  certificate  showing the  calculation  of the amount  demanded in  reasonable
detail.  Borrower  shall  have the  burden  of  proving  that the  amount  as so
calculated is not correct.

                  Section 10.02.  Amendments,  Etc. Except as expressly provided
in Article VI hereof, no amendment, modification,  termination, or waiver of any
provision  of any Loan  Document,  nor consent to any  departure by the Borrower
from any Loan Document, shall in any event be effective unless the same shall be
in writing and signed by the Majority,  and then such waiver or consent shall be
effective only in the specific  instance and for the specific  purpose for which
given; provided, however, that no such amendment,  modification,  termination or
waiver of any  provision  of any Loan  Document  shall:  (a) postpone the stated
maturity  of  principal  of, or  interest  on, any of the  Loans,  or reduce the
principal  amount of, the rate of interest  on, or the fees in  connection  with
this Agreement; (b) increase the maximum amount of the Revolving Loan Commitment
or the  Revolving  Loan  Commitment  of any Bank;  (c)  change  the  percentages
required  for action by the Banks under this  Section  10.02 or by the  Majority
under this  Agreement;  or (d) release or subordinate  any Liens in favor of the
Agent on any of the Collateral,  except as otherwise  expressly provided herein.
The  consent  of  all  of  the  Banks  is  required  to  effect  any  amendment,
modification  or waiver of the  provisions  of this  Agreement  and of each Loan
Document  which  provisions  are of a type described in clauses (a), (b), (c) or
(d) of this Section 10.02 or to effect any amendment, modification, or waiver of
this Section  10.02 or Section  10.05.  The consent of the Borrower  will not be
required to effect any  amendment,  modification  or waiver of the provisions of
Article IX of this Agreement other than Section 9.08.

                  Section 10.03.   Notices,   Etc.   All    notices   and  other
communications  provided  for under  this  Agreement  and  under the other  Loan
Documents shall be in writing  (including  facsimile  communication) and mailed,
sent by facsimile  machine or  delivered,  to the parties at the  addresses  set
forth on Exhibit K attached or, as to each party, at such other address as shall
be designated by such party in a written notice to the other party  complying as
to  delivery  with the  terms  of this  Section  10.03.  All  such  notices  and
communications  shall,  when mailed,  be effective  when  deposited in the mails
respectively  addressed as  aforesaid,  except that notices to the Agent and the
Banks  pursuant to the  provisions  of Article II shall not be  effective  until
received  by the Agent and such  Banks.  Any party  sending a notice to Borrower
pursuant to Article  VIII hereof  shall  provide a courtesy  copy to  Borrower's
counsel  at the  address  set  forth on  Exhibit  K  attached  or at such  other
addresses as shall be designated by  Borrower's  counsel in a written  notice to
the Agent and the Banks.  Notwithstanding  the foregoing  agreement to provide a
courtesy  copy to Borrower's  counsel,  such copy shall be a courtesy copy only,
and failure to provide such  courtesy  copy shall have  absolutely  no effect or
entitle  Borrower  to any remedy  whatsoever.  Any notice duly given to Borrower
shall be  effective  whether or not the  courtesy  copy was given to  Borrower's
counsel.

                  Section 10.04. No Waiver;  Remedies. No failure on the part of
the Agent or any Bank to exercise, and no delay in exercising, any right, power,
or remedy under any Loan Document shall operate as a waiver  thereof;  nor shall

<PAGE>

any single or partial exercise of any right under any Loan Document preclude any
other or  further  exercise  thereof or the  exercise  of any other  right.  The
remedies  provided in the Loan Documents are cumulative and not exclusive of any
remedies provided by law.

                  Section 10.05. Successors and Assigns. This Agreement shall be
binding  upon and inure to the benefit of the  Borrower  and the Banks and their
respective  successors  and  assigns,  except  that  Borrower  may not assign or
transfer  any of its  rights or  obligations  under any Loan  Document  to which
Borrower is a party without the prior written  consent of the Banks,  and a Bank
may not sell,  assign or participate all or any portion of its Notes (other than
a sale,  assignment,  or  participation  to an  affiliate  bank or to any of the
Banks) without the prior written consents of Borrower and Agent.

                  Section 10.06.       Costs and Expenses.

                  (1) The Borrower  agrees to pay to Agent on demand,  all costs
and expenses,  if any,  incurred by Agent in connection  with the preparation of
the Loan  Documents,  including,  without  limitation,  the reasonable  fees and
expenses of counsel  for the Agent  (subject to the  limitations  as  heretofore
agreed between Agent and Borrower.) The Borrower  agrees to pay to Agent and the
Banks on demand, all costs and expenses, if any, incurred by Agent and the Banks
in connection  with any  modification of this Agreement or any of the other Loan
Documents  that is  requested  by  Borrower  or made in response to a Default or
Event of Default,  and in  connection  with the  enforcement  of any of the Loan
Documents,  including,  without limitation,  the reasonable fees and expenses of
counsel for the Agent (with respect to  modifications  and  enforcement) and the
Banks (with respect to enforcement only) with respect thereto.

                  (2) If any payment or prepayment of principal  with respect to
any Loans accruing  interest  based on the  Eurodollar  Rate Loan is made by the
Borrower other than on the last day of the Interest  Period for such Loans,  and
such payment is permitted pursuant to Section 2.09, or is made as a result of an
acceleration  of the  maturity of the Notes  pursuant to Section 8.01 or for any
other  reason,  the  Borrower  shall,  upon demand by the Agent on behalf of the
Banks,  pay the Agent for the  account  of the Banks  any  amounts  required  to
compensate the Banks for any additional losses, costs or expenses which they may
reasonably incur as a result of such payment, including, without limitation, any
loss  (including  loss of anticipated  profits),  costs or expenses  incurred by
reason of the liquidation or reemployment of deposits or other funds acquired by
the Banks to fund or maintain such Loan.

                  Section 10.07. Right of Setoff. Upon the occurrence and during
the continuance of any Event of Default,  each Bank is hereby  authorized at any
time and from time to time,  without  notice to the  Borrower  (any such  notice
being  expressly  waived  by the  Borrower),  to set off and  apply  any and all
deposits (general or special, time or demand,  provisional or final) at any time
held and other  indebtedness at any time owing by a Bank to or for the credit or
the account of Borrower  against any and all of the  obligations of the Borrower
now or  hereafter  existing  under this  Agreement,  the Notes or any other Loan
Document,  irrespective  of whether or not the Agent  shall have made any demand
under this  Agreement or the Notes or such other Loan Document and although such
obligations  may be unmatured.  Each Bank agrees promptly to notify the Borrower
after any such setoff and  application,  provided  that the failure to give such
notice shall not affect the validity of such setoff and application.  The rights
under  this  Section  10.07  are  in  addition  to  other  rights  and  remedies
(including,  without  limitation,  other  rights of setoff)  which the Banks may
have.

                  Section 10.08. Sharing of Setoffs. Each Bank agrees that if it
shall,  by exercising any right of setoff receive payment of a proportion of the
aggregate  amount of principal and interest due with respect to any of the Notes
held by it (or any other  obligations of Borrower  hereunder to such Bank) which
is  greater  than the  proportion  received  by any other Bank in respect of the
aggregate  amount of principal and interest due with respect to any of the Notes
held by such other Bank (or any other obligations of Borrower  hereunder to such
Bank),  the Bank receiving such  proportionately  greater payment shall purchase
such  participations  in the  Notes  held  by the  other  Banks  (or  any  other
obligations of Borrower hereunder to the other Banks) and such other adjustments

<PAGE>

shall be made,  as may be required so that all such  payments of  principal  and
interest on the Notes (or other obligations of Borrower  hereunder to the Banks)
shall be shared by the Banks pro rata,  provided  that if any such  non-pro rata
payment  is  thereafter  recovered  or  otherwise  set aside  such  purchase  of
participations shall be rescinded (without interest).

                  Section 10.09.  Governing Law;  Jurisdiction  and Venue.  This
Agreement  and the other Loan  Documents  shall be governed by, and construed in
accordance with, the laws of the State of Missouri. The Borrower hereby consents
to the  jurisdiction of the Circuit Court of the County of St. Louis,  Missouri,
and the United States  District Court for the Eastern  District of Missouri,  as
well as to the jurisdiction of all courts from which an appeal may be taken from
any such courts, for the purpose of any suit, action or other proceeding arising
out  of  any of  its  obligations  arising  hereunder  or  with  respect  to the
transactions contemplated hereby, and expressly waives any and all objections it
may have as to venue in any such courts and agrees that any proceeding initiated
in another  court  which  relates to such  matters  may be, at the option of the
Agent, transferred to any of such courts.

                  Section 10.10.  Severability  of Provisions.  Any provision of
any Loan  Document  which is  prohibited or  unenforceable  in any  jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition
or unenforceability  without  invalidating the remaining provisions of such Loan
Document or affecting the validity or  enforceability  of such  provision in any
other jurisdiction.

                  Section 10.11. Counterparts. This Agreement may be executed in
any  number of  counterparts  and by  different  parties  to this  Agreement  in
separate  counterparts,  each  which when so  executed  shall be deemed to be an
original  and all of which  taken  together  shall  constitute  one and the same
agreement.

                  Section 10.12.       Headings.  Article  and  Section headings
in the Loan Documents are included in such Loan Documents for the convenience of
reference only and shall not constitute a part of the applicable  Loan Documents
for any other purpose.

                  Section 10.13. Oral Agreements. Oral agreements or commitments
to loan money,  extend credit or to forbear from  enforcing  repayment of a debt
including promises to extend or renew such debt are not enforceable.  To protect
you (Borrower) and us (creditors) from  misunderstanding or disappointment,  any
agreements we reach  covering such matters are contained in this writing,  which
is the complete and exclusive  statement of the agreement  between us, except as
we may later agree in writing to modify it.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]


<PAGE>


                  IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.

                                   FIRST BANKS, INC.

                                   By /s/Allen H. Blake
                                   --------------------
                                        Allen H. Blake
                                        Executive Vice President

                                   MERCANTILE BANK NATIONAL
                                   ASSOCIATION, as Agent and as a Bank

                                   By /s/David C. Buettner
                                   -----------------------
                                        Name: David C. Buettner
                                        Title: Vice President

                                   HARRIS TRUST AND SAVINGS BANK

                                   By /s/Patrick A. Horne
                                   ----------------------
                                        Name: Patrick A. Horne
                                        Title: Vice President


                                   AMERICAN NATIONAL BANK AND TRUST
                                   COMPANY OF CHICAGO

                                   By /s/ James K. Pridmore
                                   ------------------------
                                        Name: James K. Pridmore
                                        Title: First Vice President


                                   THE FROST NATIONAL BANK

                                   By /s/Jerry L. Crutsinger
                                   -------------------------
                                        Name: Jerry L. Crutsinger
                                        Title: Senior Vice President


                                   NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION

                                   By /s/ Alfonso A. Buscemi
                                   -------------------------
                                        Name:  Alfonso A. Buscemi
                                        Title: Vice President


<PAGE>




                                    EXHIBIT A

                        REVOLVING LOAN COMMITMENT AMOUNTS
<TABLE>
<CAPTION>


                    Bank                                                       Amount of Commitment

<S>                                                                                   <C>
Mercantile Bank National Association                                                  $33,500,000



American National Bank and Trust Company of Chicago                                   $22,500,000



Harris Trust and Savings Bank                                                         $16,500,000



Norwest Bank Minnesota, National Association                                          $16,500,000



The Frost National Bank                                                               $11,000,000



                                                                                     $100,000,000

</TABLE>

<PAGE>


                                    EXHIBIT B

                              REVOLVING CREDIT NOTE

$______________                                             St. Louis, Missouri
                                                                August 25, 1999

                  FOR VALUE  RECEIVED,  the  undersigned,  First Banks,  Inc., a
Missouri   corporation   ("Borrower"),   promises   to  pay  to  the   order  of
_______________  ("Payee") at the offices of the Agent at One Mercantile Center,
7th & Washington, St. Louis, Missouri 63101, the principal sum of ______________
Dollars ($_____________) or such lesser amount as may be outstanding hereunder.

                  The Borrower  promises to pay interest from the date hereof on
the unpaid principal balance  outstanding from time to time prior to maturity at
the rates and at the time or times which shall be determined in accordance  with
the provisions of that certain Amended and Restated  Secured Credit Agreement of
even date herewith, by and between the Borrower,  the Payee and other banks (the
"Credit Agreement").

                  The entire unpaid principal  balance hereunder and all accrued
and unpaid interest hereon shall be due and payable on August 24, 2000. Interest
shall be  calculated  on the basis of the actual  number of days  elapsed over a
year of 360 days.

                  If any  payment  due on this Note is payable on a day which is
not a Business Day (as defined in the Credit Agreement),  then such payment will
be made on the next Business  Day, the amount of such payment,  in such case, to
include all interest accrued to the date of actual payment.

                  This Note is one of the "Revolving  Notes"  referred to in the
Credit Agreement,  is secured as provided therein, and is entitled to all of the
benefits  thereof.  In accordance  with the terms of the Credit  Agreement,  the
Agent (as defined  thereunder)  may declare the unpaid  balance of the principal
and accrued interest to be immediately due and payable upon the occurrence of an
Event of  Default  as defined  in the  Credit  Agreement,  whereupon  the unpaid
principal and accrued interest then owing hereon shall be and become immediately
due and payable, and interest shall accrue interest at a rate per annum equal to
four percent (4%) in excess of the then otherwise applicable rate of interest as
determined in accordance with Sections 2.03 and 2.04 of the Credit Agreement.

                  If this Note shall not be paid at  maturity,  whether upon the
exercise of  acceleration  or otherwise,  and shall be placed in the hands of an
attorney  for  collection  or  in  connection   with  insolvency  or  bankruptcy
proceedings,  the  Borrower  hereby  promises  to pay the  reasonable  fees  and
expenses of such attorney in addition to the full amount due hereon,  whether or
not litigation shall be commenced.



<PAGE>


                  Demand for payment,  protest and notice of dishonor are hereby
waived by all who are or shall become parties to this instrument.

                                                   FIRST BANKS, INC.


                                                   By:
                                                   --------------------------
                                                   Name:
                                                   --------------------------
                                                   Title:
                                                   --------------------------


<PAGE>


                                    EXHIBIT C

                       REVOLVING LOAN NOTICE OF BORROWING

TO:               Mercantile Bank National Association, as Agent

FROM:             First Banks, Inc.

DATE:             _____________,

                  This  Revolving  Loan Notice of Borrowing  is being  submitted
pursuant to the terms of the Amended and Restated Secured Credit Agreement dated
as of  August  25,  1999  ("Credit  Agreement"),  as the same may be  thereafter
amended from time to time,  among First Banks,  Inc. and the banks named therein
(for whom Mercantile Bank National Association is acting as Agent).

(1)      The  Business Day of the proposed  principal  advance  under the Credit
         Agreement is:

(2)      The principal  advance under the Credit  Agreement  will be a Revolving
         Loan that accrues interest [at the Prime Rate] [based on the Eurodollar
         Rate] as provided in the Credit Agreement.

(3)      The Interest  Period for the Eurodollar  Rate Loan requested  hereunder
         (or the new Interest  Period for an expiring  Interest Period)  is ____
         months.
(4)      The current aggregate outstanding balance of the Revolving Loans as  of
          the date hereof is: $

(5)      The principal advance being requested is (must be
         at least the unused portion of the Revolving Loan Commitment
         of $100,000,000 or $1,000,000, whichever is less):    $

(6)      The use of the  proceeds for the  Loan requested  hereby  will  be  for
         ___________________

(7)      Unused portion of the Revolving Loan  Commitment  upon advance of funds
         requested by this Notice
         ($100,000,000 - #4 - #5):               $

                                      FIRST BANKS, INC.


                                      By:
                                      ------------------------------------
                                      Name:
                                      ------------------------------------
                                      Title:
                                      ------------------------------------


<PAGE>


                                    EXHIBIT D

                      AMENDED AND RESTATED PLEDGE AGREEMENT

                  In consideration of and as collateral security for the payment
of any and all present and future  indebtedness,  obligations and liabilities of
FIRST BANKS, INC., a Missouri corporation  ("Pledgor") under or pursuant to that
certain  Secured  Credit  Agreement  dated as of August 26, 1998 and amended and
restated  as of  August  25,  1999  (together  with  any  extensions,  renewals,
amendments or modifications  thereof,  the "Credit Agreement") among Pledgor and
Mercantile  Bank National  Association  ("Mercantile"),  Norwest Bank Minnesota,
National Association,  Harris Trust and Savings Bank, American National Bank and
Trust Company of Chicago and The Frost National Bank  (collectively the "Banks")
and the other  "Loan  Documents"  referred  to therein  (all such  indebtedness,
obligations  and  liabilities,   whether  direct  or  indirect,   liquidated  or
unliquidated,  absolute  or  contingent,  now  existing  or  hereafter  arising,
individual, joint, or joint and several being collectively referred to herein as
the  "Liabilities"),  Pledgor  hereby pledges to Mercantile as agent for and for
the ratable benefit of the Banks (as agent for the Banks, Mercantile is referred
to  hereinafter  as  "Pledgee")  and grants the  Pledgee a  continuing  security
interest in the capital stock of certain  Subsidiaries of Pledgor,  as described
on  Exhibit  A  attached  hereto  and  incorporated  herein  (together  with any
additional  stock  described in Section 4 hereof,  collectively,  the  "Stock"),
together with all substitutions  therefor and dividends (as limited herein), new
shares or warrants,  liquidating distributions and other rights, and proceeds or
distributions of any nature  associated  therewith,  all of which Pledgor hereby
represents  and warrants  that it owns (or, for purposes of Section 4, will own)
free of liens or claims of any kind, with fully  marketable  title thereto,  and
has (or will have) the right to so pledge.

                  Pledgor  agrees that said Stock,  together  with the  proceeds
thereof  (hereinafter  collectively  called the "Collateral,"  such term as used
herein  including any  underlying  security for any note or other  evidence of a
monetary obligation pledged hereunder) shall constitute security for any and all
of the  Liabilities and may be held, in accordance with the terms and provisions
of this Agreement,  for the payment thereof for such periods and applied thereto
at such  times  and in such  order  as the  Pledgee  from  time to time may deem
appropriate,  whether  or not the  Liabilities  for  which  the same are held or
applied  are in  existence  at the time of  delivery  of this  Agreement  or the
Collateral and whether or not such  Liabilities are contingent,  unliquidated or
unmatured.

                  Pledgor further agrees that:

                  1.  Pledgor  will  keep the  Collateral  free  from all  other
security interests, liens or encumbrances except those security interests, liens
or encumbrances now or hereafter  granted to the Pledgee.  Pledgor will procure,
execute,  endorse  and deliver all  documents  which the Pledgee may  reasonably
require to protect,  enforce or otherwise effectuate the Pledgee's rights in the
Collateral  and Pledgor  hereby  grants to the Pledgee an  irrevocable  power of
attorney,  with  full  power of  substitution,  to so act in  Pledgor's  name if
Pledgor fails to do so.

                  2. The Pledgee may collect the  Collateral or any part thereof
at any time except  with  respect to  dividends,  which  shall be  collected  by
Pledgee only in accordance with Paragraph 3 hereof. For such purpose the Pledgee
(after the occurrence of an Event of Default under the Credit  Agreement that is
continuing)  may take,  in its own name or in the name of  Pledgor,  any  action
which Pledgor might take including suit against any obligor on any note or other
monetary  obligation  constituting  part of the  Collateral and collection of or
foreclosure upon any underlying  security,  and such action may be taken without
first  foreclosing  under  this  Agreement  on the  obligations  secured by such
underlying security. The Pledgee shall have no obligation, however, to pursue or
preserve  remedies  against  any party  primarily  or  secondarily  liable as an
obligor on the  Collateral  or otherwise to take action which Pledgor might have
taken as regards the Collateral or any underlying security therefor.

                  3. Pledgee  shall have the  continuing  right to retain all or
any part of the Collateral so long as any Liability remains in existence (or the

<PAGE>

Banks shall have any  Commitment  under the Credit  Agreement),  even though the
same may be unliquidated,  unmatured or contingent.  Upon maturity of any of the
Liabilities or the occurrence of an Event of Default under the Credit  Agreement
or hereunder,  the Pledgee may cause any of the  Collateral to be transferred to
its own name or to the name of its nominee (and this shall be full  authority to
any transfer agent, registrar or the like to make such transfer). No such action
shall be deemed a retention of the Collateral in  satisfaction  of any Liability
unless  written  notice so stating  shall be given to the  Pledgor.  The Pledgee
shall have the sole right to determine  whether any call or option to surrender,
exchange,  redeem,  convert  or  otherwise  change  or  alter  the  form  of the
Collateral  shall be  exercised if the interest of Pledgee is or may be affected
thereby.  The Pledgee  shall be under no  obligation to initiate any such action
unless  requested  in  writing  by the  Pledgor.  All  dividends,  new shares or
warrants,  liquidating  distributions and other rights, proceeds and payments or
distributions  of any nature  received  by Pledgor in respect of the  Collateral
will be delivered to the Pledgee in kind and the Pledgee may take such action as
is necessary to assure its direct receipt thereof,  provided however that, prior
to the  occurrence  of an  Event  of  Default  under  the  Credit  Agreement  or
hereunder, Pledgor shall be permitted to retain permitted ordinary dividends and
interest  paid in cash and shall  retain  the right to vote with  respect to the
Collateral.

                  4. In the event that Pledgor, after the date hereof,  acquires
all or any  portion  of the  stock of any bank,  bank  holding  company,  thrift
institution or savings holding company (i) with the proceeds of a Loan under the
Credit  Agreement  or (ii) which is or by virtue of such  acquisition  becomes a
Subsidiary as defined in the Credit  Agreement (other than as may be acquired by
First  Banks  America,  Inc.),  Pledgor  promptly  shall (A) grant to  Pledgee a
security interest in such stock as additional security for the Liabilities,  (B)
deliver  to  Pledgee  the  certificates  representing  such  stock,  along  with
fully-executed stock powers therefor, and (C) take such other action and execute
and deliver such other documents to Pledgee as Pledgee reasonably may require in
connection therewith.

                  5. The  following  severally  shall be  considered  events  of
default for purposes of this Agreement:  (a) if any representation,  warranty or
statement  of fact  made  by  Pledgor  hereunder  shall  prove  to be  false  or
misleading in any material  respect,  and such default  remains  unremedied  for
thirty (30) consecutive calendar days after notice thereof shall have been given
to  Pledgor by the  Pledgee,  (b) an Event of  Default  occurs  under the Credit
Agreement,  or (c)  seizure  of any of the  Collateral  or sale  or  encumbrance
thereof or the failure to pay any tax thereon when due (except any tax contested
in good faith for which reserves for payment reasonably  satisfactory to Pledgee
have been provided by the Pledgor).

                  6. Upon maturity of any of the Liabilities (by acceleration or
otherwise) or the occurrence of an event of default  hereunder,  the Pledgee may
resort to the  Collateral  at such  times and in such order as it elects and may
apply the  Collateral to the  Liabilities  in like manner and without  regard to
whether  application  is made to an obligation of the owner of the Collateral so
applied.  If any of the  Collateral is owned by someone other than Pledgor,  the
Pledgee may elect to apply such  Collateral in any  proportion to obligations of
the  owner or owners  to the  Pledgee  without  regard  to the  Liabilities.  In
addition,  the  Pledgee  shall  have all  rights  of a secured  party  under the
Missouri  Uniform  Commercial  Code and shall apply the proceeds of  collection,
disposition or other realization on the Collateral to reasonable attorneys' fees
and legal  expenses  incurred by the Pledgee in connection  therewith and in the
collection of any Liabilities and  representation  of the Pledgee in proceedings
of any nature under the  Bankruptcy  Code, and thereafter as required by law. If
notice of intended disposition is required by law, such notice, if mailed, shall
be deemed  reasonably  and  properly  given if mailed to the  address of Pledgor
appearing  on the  records of the  Pledgee at least five (5)  Business  Days (as
defined  in the  Credit  Agreement)  before  the time of such  disposition.  The
Pledgee  shall have the right to proceed  against the  Collateral  or not as the
Pledgee may deem proper or as directed by the Majority (as defined in the Credit
Agreement), and the Pledgee shall have the right to collect dividends,  interest
and such like profits from the Collateral whether or not it proceeds against the
Collateral. If, in the opinion of the Pledgee, any Collateral cannot be disposed
of in a commercially  reasonable  manner without  registration  under applicable
securities  laws,  Pledgor  will  take or cause to be taken  such  action  as is
necessary to effect  proper  registration.  If Pledgor shall refuse to take such
action,  the Pledgee at its election,  but without any  obligation to do so, may
take such action as it deems warranted to attempt to effect  compliance with any

<PAGE>

applicable  law. Any cost, fee or expense  incurred by the Pledgee in connection
with  such  efforts  or in  enforcing  Pledgor's  covenants  hereunder  will  be
considered a cost incurred in disposition of the Collateral.

                  7. The Pledgee's  rights  hereunder shall continue  unimpaired
notwithstanding  foreclosure or other disposition of any part of the Collateral,
the  availability of additional  Collateral,  any release of or substitution for
any of the Collateral,  any act or omission  impairing the Pledgee's lien on the
Collateral  or the  lien of any  underlying  security  constituting  part of the
Collateral,  including  failure to perfect the same,  any  extension  (including
extension of time for payment), renewal, substitution,  alteration,  compromise,
settlement,  surrender,  release or other such agreement or action  modifying or
varying the terms of or otherwise  affecting any of the  Liabilities or any part
of the Collateral,  including any act or omission  releasing any party primarily
or  secondarily  liable on the  Collateral  or on any  Liability.  No failure by
Pledgee to exercise or delay in  exercising  any of its rights  hereunder  shall
constitute a waiver thereof and no single or partial exercise of any right shall
preclude the further  exercise  thereof or the exercise of any other right.  All
rights of the  Pledgee  hereunder  or under any  instrument  or other  agreement
binding on Pledgor are cumulative and not in substitution of any other rights at
law  or  equity  with  respect  to  the  Collateral  or  the  collection  of the
Liabilities.  All such rights may be exercised from time to time. Pledgor hereby
waives notice of any and all actions,  forbearances  and omissions of any rights
contemplated  by this  paragraph and consents to be bound thereby as effectively
as if Pledgor had agreed thereto in advance.  Upon the termination of the Credit
Agreement  and the  liquidation  and payment of the  liabilities  in full,  this
Agreement shall  terminate and the Collateral will be returned  forthwith to the
Pledgor.

                  8. The Pledgee  shall have no  obligation to act in accordance
with  any  communication  by  Pledgor  or  any  other  party  obligated  on  the
Liabilities or interested in the Collateral, as endorser,  guarantor,  surety or
otherwise, concerning the liquidation of all or any part of the Collateral if it
shall be the opinion of the Pledgee in the exercise of its  reasonable  judgment
that  the  value of the  Collateral  upon  liquidation  may be  insufficient  to
discharge the  Liabilities in full. The Pledgee shall in no event be bound by or
obligated to act upon any such communication unless the same shall be in writing
and shall include explicit instructions as to the disposition requested.

                  9. Any notice required or permitted  hereunder shall be deemed
given if sent in the  manner  and at the  addresses  as  provided  in the Credit
Agreement.

                  10. To the extent  required by law for  purposes of  providing
qualifying  shares of stock to  members  of the board of  directors  of the bank
institutions  owned by  Pledgor,  Pledgee  agrees  to  release  such  number  of
qualifying  shares  from the lien of this  Agreement.  To effect  such  release,
Pledgee  will  deliver  the  certificate  for the shares of stock of the subject
banking  institution  to the  Pledgor  on a trust  receipt  basis  and  with the
obligation  of Pledgor  to return the  reissued  certificate  to Pledgee  within
forty-eight  (48) hours of the  delivery to Pledgor.  At the request of Pledgee,
Pledgor  agrees to cause such  members of the board of  directors to pledge such
qualifying  shares  to  Pledgee  for the  benefit  of the  Banks  as  additional
collateral for the Liabilities. Any such qualifying shares shall, upon issuance,
contain an  appropriate  legend  describing the  restrictions  and covenants set
forth in this Agreement.

                  11. This agreement  shall be construed in accordance  with and
governed by Missouri law.

                  12. Pledgor warrants and represents to Pledgee that the shares
of stock of each institution as listed on Exhibit A on the date hereof represent
all of the outstanding  shares of stock of each respective  institution  (except
for directors' qualifying shares and except with respect to First Banks America,
Inc.).  Pledgor  represents and warrants that the shares of stock of First Banks
America, Inc. as listed on Exhibit A on the date hereof represent  approximately
[47.8%] of the  outstanding  common stock and all of the  outstanding  shares of
Class B common stock issued by such  institution  and such shares have  ordinary
voting  power to elect a  majority  of the  board of  directors  of First  Banks
America, Inc.
<PAGE>

                  13.  Pledgor has  heretofore  entered into a Pledge  Agreement
dated  as of  August  26,  1998  (the  "Original  Pledge  Agreement").  Upon the
execution  and  delivery of this  Agreement  by  Borrower  the  Original  Pledge
Agreement  shall be amended  and  restated  in its  entirety  by this  Agreement
effective  as of the date  hereof,  with all rights,  obligations  and  security
interests  created under or granted  pursuant to the Original  Pledge  Agreement
continuing from the date thereof.

Dated at St. Louis, Missouri, as of this 25th day of August, 1999.

                                      FIRST BANKS, INC.


                                      By:
                                      ----------------------------------
                                      Name:
                                      ----------------------------------
                                      Title:
                                      ----------------------------------


<PAGE>


                           PLEDGE AGREEMENT EXHIBIT A

                               LIST OF COLLATERAL


10,000 shares of the common stock of First Bank

2,210,581 shares of the Common Stock of First Banks America, Inc.

2,500,000 shares of the Class B Common Stock of First Banks America, Inc.

4,725,396 shares of the common stock of First Bank & Trust



<PAGE>


                                    EXHIBIT E

                            CERTIFICATE OF COMPLIANCE

                  This  Certificate  of  Compliance  is being  submitted on this
______ day of _______________,  ______, for the quarter ending on the ______ day
of  _______________,  ______,  pursuant to the terms of the Amended and Restated
Secured Credit  Agreement dated as of August 25, 1999 ("Credit  Agreement"),  as
the same may be  thereafter  amended from time to time,  among  Mercantile  Bank
National  Association  ("Mercantile")  and the  banks  named  therein  (for whom
Mercantile is acting as Agent).

                  The  undersigned  officers  of  First  Banks, Inc. jointly and
 severally certify to the Banks that as of the date hereof:

         A.       The representations and warranties contained in Article IV  of
                  the Credit Agreement are correct as of the date hereof;

         B.       No  Default  or  Event  of  Default   has  occurred   and   is
                  continuing,  [or would  result  upon the making of the Loan
                  requested  by   the   accompanying   Revolving  Loan Notice of
                  Borrowing;]

         C.       Attached is an accurate listing of  the current Affiliates  of
                  First Banks, Inc.;

         D.       The compliance with the covenants contained in  Article VII of
                  the Credit Agreement is supported by the following:

7.01.    Tier I Leverage Ratio
<TABLE>
<CAPTION>
<S>                                                            <C>            <C>      <C>           <C>
                                                               (1)            (2)                    Minimum
                                                             Tier I          Total     Ratio of      Ratio
                                                             Capital        Assets     (1) to (2)    Permitted

First Banks, Inc. (consolidated)                                                                     5.0%


</TABLE>



<PAGE>


7.02.    Tier I Leverage Ratio of Subsidiaries
<TABLE>
<CAPTION>
<S>                                                            <C>            <C>      <C>           <C>
                                                               (1)            (2)                    Minimum
                                                             Tier I          Total     Ratio of      Ratio
Subsidiary                                                   Capital        Assets     (1) to (2)    Permitted

First Bank                                                _______        _______                     5.0%
First Bank of California                                  _______        _______                     5.0%
First Bank Texas, N.A.                                    _______        _______                     5.0%
Redwood Bank                                              _______        _______                     5.0%
First Bank & Trust                                        _______        _______                     5.0%


7.03.    Tier I Risk Based Capital Ratio

                                                                        (2)
                                                                         Weighted-Risk
                                                                         Assets and
                                                                         Off-Balance
                                                          (1)            Sheet Items     Ratio of     Minimum Ratio
                                                          Tier I                        (1) to (2)   Permitted
                                                          Capital
First Bank                                                _______        _______                     6.0%
First Bank of California                                  _______        _______                     6.0%
First Bank Texas, N.A.                                    _______        _______                     6.0%
Redwood Bank                                              _______        _______                     6.0%
First Bank & Trust                                        _______        _______                     6.0%

</TABLE>


<PAGE>

<TABLE>
<CAPTION>

7.04.    Total Risk Based Capital Ratio
<S>                                                      <C>             <C>             <C>        <C>

                                                                         (2)
                                                                         Weighted-Risk
                                                                         Assets and
                                                                         Off-Balance
                                                                         Sheet Items    Ratio of     Minimum Ratio
                                                          (1) Total                     (1) to (2)   Permitted
                                                          Capital
First Bank                                                _______        _______                     10.0%
First Bank of California                                  _______        _______                     10.0%
First Bank Texas, N.A.                                    _______        _______                     10.0%
Redwood Bank                                              _______        _______                     10.0%
First Bank & Trust                                        _______        _______                     10.0%

7.05     Loan Loss Reserve

                                                          (1)
                                                          Loan           (2)            Ratio of     Minimum Ratio
                                                          Loss           Total          (1) to (2)   Permitted
                                                          Reserve        Loans
First Banks, Inc. (consolidated)                          _______        _______                     1.25%

</TABLE>


<PAGE>

<TABLE>
<CAPTION>

7.06     Net Income to Average Total Assets

<S>                                                   <C>                <C>                          <C>
                                                      Average Total                                   Minimum
Net Income less extraordinary and/or nonrecurring       Assets (2)       Ratio of (1)                  Ratio
items for the quarter ended:                                                 to (2)                   Permitted

First Banks, Inc. (consolidated)
                             $



Total Net Income             $                          (1)                                             0.70%

First Bank and First Bank & Trust (combined)
                             $



Total Net Income             $                          (1)                                             0.70%
</TABLE>


<PAGE>

<TABLE>
<CAPTION>


7.07     Non-Performing Assets

<S>                                                    <C>               <C>            <C>          <C>

                                                       (1)
                                                       Non-Performing    (2)            Ratio of     Maximum Ratio
                                                       Assets            Primary        (1) to (2)   Permitted
                                                                         Capital
First Banks, Inc. (consolidated)                       _______           _______                       25%

         E.       Performance Ratio

First Banks, Inc. (consolidated)
Net Income less extraordinary and/or nonrecurring items for          (2)             Ratio of (2)       Applicable
the quarter ended:                                               Funded Debt            to (1)             Margin

                              $



Total Net Income              $                         (1)   $
</TABLE>


         F.       The use of proceeds of the requested Loan will be as indicated
                  in the accompanying Revolving Loan Notice of Borrowing.

Signed as of the day and year first above written.

                            FIRST BANKS, INC.
                            (at least two signatures required)

                            By:  __________________________________
                                     Chief Executive Officer

                            By:  __________________________________
                                     Chief Financial Officer

                            By:  ___________________________________
                                     Vice President - Chief Accounting Officer

                            By:  ___________________________________
                                     Chief Credit Officer

                            By: ___________________________________
                                     Chief Operating Officer


<PAGE>


                                    EXHIBIT F

                       FORM OF BORROWER'S COUNSEL OPINION

                                 August 25, 1999


Mercantile Bank National Association            Harris Trust and Savings Bank
One Mercantile Center                           111 W. Monroe
St. Louis, Missouri 63101                       Chicago, Illinois 60603


Norwest Bank Minnesota, National Association    American National Bank and Trust
100 East Wisconsin Avenue                       Company of Chicago
Milwaukee, Wisconsin  63202-4101                33 North LaSalle Street
                                                Chicago, Illinois 60690


The Frost National Bank
100 West Houston Street
San Antonio, Texas  78205


                  Re:    Mercantile  Bank  National Association - $100,000,000
                         Secured Revolving Credit Facility for First Banks, Inc.

Ladies and Gentlemen:

                  We have acted as counsel  for First  Banks,  Inc.,  a Missouri
corporation, (the "Borrower") in connection with their negotiation and execution
of the Loan  Documents  as defined  herein for the limited  purpose of providing
this  opinion.  This  opinion is being  furnished  to you as required by Section
3.01(6) of the Amended and Restated  Secured Credit  Agreement  executed on this
date by the Borrower and Mercantile  Bank National  Association  ("Mercantile"),
Norwest Bank  Minnesota,  National  Association,  Harris Trust and Savings Bank,
American National Bank and Trust Company of Chicago, and The Frost National Bank
(collectively, the "Banks") and Mercantile as "Agent" for the Banks. Capitalized
terms not otherwise  defined  herein shall have the meaning  ascribed to them in
that certain  Amended and Restated  Secured Credit  Agreement dated as of August
25, 1999 among the Borrower and the Banks (the "Credit Agreement").

                  In connection  with the  preparation of this opinion,  we have
reviewed the  following  instruments  and documents  executed by the  respective
parties thereto (the "Loan Documents"):

                  1.       Each of the  Notes,  dated  August 25,  1999,  in the
                           aggregate    maximum   principal   face   amount   of
                           $100,000,000  executed  by the  Borrower as maker and
                           payable to the order of the  respective  Banks as set
                           forth in Section 2.05 of the Credit Agreement;

                  2.       The Credit Agreement;

                  3.       Amended and Restated  Pledge  Agreement  dated August
                           25, 1999 executed by the Borrower, as Pledgor, to the
                           Agent, as Pledgee (the "Borrower Pledge Agreement");
<PAGE>

                  4.       The  certificates  representing the shares of capital
                           stock of the Pledged  Subsidiaries   that are pledged
                           under the Borrower Pledge Agreement; and

                  5.       Irrevocable Stock Powers executed by Borrower.

                  In our capacity as counsel for the Borrower,  we have examined
originals or copies of such other documents, records and other instruments as we
have deemed necessary or appropriate to render this opinion, including,  without
limitation, the following:

                  A.       Articles of Incorporation and Bylaws of the Borrower;
                           and

                  B.       Resolutions adopted by the Boards of Directors of the
                           Borrower.

                  For  purposes of this  opinion,  we have  assumed that (1) all
documents  submitted to us are authentic,  (2) all documents  submitted to us as
certified or photostatic copies conform to the originals,  (3) all signatures on
documents  are  genuine,  (4) all natural  persons  whose  signatures  appear on
documents had legal capacity,  (5) all  certificates  from public  officials are
accurate as of the date of this  letter,  (6) all records of the  Borrower  made
available to us are accurate and complete,  (7) the Agent and the Banks have the
power and  authority  to  execute,  deliver,  and  perform  all  agreements  and
documents  executed  by them,  (8) the Agent and the Banks have duly and validly
executed and delivered such  agreements and documents,  and (9) such  agreements
and documents are legally valid,  binding and enforceable  against the Agent and
the Banks.

                  In those  instances  in which our opinion is rendered  "to our
knowledge," it means that we have relied on the  representations by the Borrower
in the Loan Documents to establish facts relevant to our opinion and that during
the course of our  representation  no  information  has come to the attention of
those attorneys  within our firm who have performed legal services in connection
with the  representation  described  in this  letter  that  would give us actual
knowledge of the  inaccuracy of such  representations.  We have not conducted an
independent  investigation to determine the accuracy of any representation  made
by the Borrower or any assumption that we have made herein,  and no inference as
to our  knowledge  should be drawn from our  representation  of the  Borrower as
described in this letter.

                  Based upon the  foregoing,  and subject to the  qualifications
set forth herein, our opinion is that:

                  1.       The Borrower is a duly organized and validly existing
                           corporation  in good  standing  under the laws of the
                           State of  Missouri  and has the  corporate  power and
                           authority  to  execute,  deliver and perform the Loan
                           Documents and to own its  properties and carry on its
                           business  as  now  being  conducted,  and  is a  duly
                           registered  bank  holding  company  in good  standing
                           under  the  Bank  Holding  Company  Act of  1956,  as
                           amended.

                  2.       The Loan Documents executed by the Borrower have been
                           duly  authorized,   executed  and  delivered  by  the
                           Borrower and constitute the legal,  valid and binding
                           obligations of the Borrower enforceable in accordance
                           with their  respective  terms,  subject to applicable
                           bankruptcy, insolvency, reorganization, moratorium or
                           similar laws affecting the  enforcement of creditors'
                           rights generally,  and subject to general  principles
                           of  equity   (including   the  exercise  of  judicial
                           discretion  in  accordance  with  such   principles),
                           regardless   of  whether   such   enforceability   is
                           considered in a proceeding at law or in equity.

                  3.       No consent  or  approval of  or registration with any
                           federal,  state  or  local  government  or regulatory
                           authority   is  required   in  connection  with   the

<PAGE>

                           execution  and delivery of the Loan  Documents by the
                           Borrower   or   the   making   of   any  of the Loans
                           thereunder.  Neither    (i)   the    execution    and
                           delivery   by  the  Borrower  of the Loan  Documents,
                           (ii) consummation  of the  transactions  contemplated
                           thereby,  nor  (iii)  compliance by the Borrower with
                           any of  the  provisions  thereof  will  conflict with
                           or result in  a violation or breach of, or constitute
                           a  default  under,  (a) the  Borrower's  Articles  of
                           Incorporation  or  Bylaws,  or (b) to our  knowledge,
                           any  rule,   regulation,  order,   writ,  judgment or
                           decree   of   any   court  or   government  agency or
                           instrumentality  or any   agreement or  instrument to
                           which the Borrower  is a  party  or  with  respect to
                           which the Borrower is bound and  which is  reasonably
                           likely  to  have  a  material  adverse  effect on the
                           Borrower's  ability to perform  its obligations under
                           the Loan Documents.

                  4.       To our  knowledge,  there  are no  actions,  suits or
                           proceedings  pending or  threatened  that  affect the
                           Borrower,  before or by any federal,  state, local or
                           other  governmental  department,  commission,  board,
                           bureau,  agency or  authority  which,  if  determined
                           adversely  to  the  Borrower,  would  materially  and
                           adversely  affect the  Borrower's  ability to perform
                           under the Loan Documents.

                  5.       Assuming  that the shares of stock  described  in the
                           Borrower Pledge  Agreement have been delivered to the
                           agent  in the  State  of  Missouri  together  with an
                           executed stock power for each  certificate  therefor,
                           the  Agent,  for  the  benefit  of the  Banks,  has a
                           perfected security interest in such stock.

                  The opinions  expressed  herein are limited to the  applicable
laws of the United  States and the State of Missouri and no opinion is expressed
with respect to the laws of any other jurisdiction or state or the effect of any
such laws on the matters  dealt with  herein.  Anything  herein to the  contrary
notwithstanding, we express no opinion on matters governed by federal, state and
local laws, rules, regulations, ordinances or restrictive covenants relating to:
(1) occupational health and safety,  environmental siting, impact and discharge,
or storage and  discharge of flammable or hazardous  materials or solid or toxic
waste;  (2) rights to set off or off set; (3) the effect of provisions  agreeing
to the  jurisdiction  of a court (or  waiving  objections  to  jurisdiction)  or
agreeing  to venue  (or  waiving  objections  to  venue);  (4) the  legality  or
enforceability   of  exculpation   clauses;   (5)  the   enforceability  of  any
choice-of-law  clause or provision  requiring the  application  of the laws of a
particular  jurisdiction;  (6) any federal or state tax consequences  arising in
connection with any of the transactions  contemplated by the Loan Documents; (7)
patent,  copyright,  service  mark,  trade  name  or  trademark  rights;  or (8)
antitrust matters.

                  This  opinion is provided  solely for the purpose of complying
with the  requirements  of the Loan  Documents  and,  without our prior  written
consent,  may not be  relied  upon by  anyone  other  than the  Banks  and their
respective successors and assigns.
 Our  opinion is based upon the facts and the law as  existing  and in effect on
the date hereof,  and we assume no  obligation  to revise,  supplement or update
this opinion in any respect at any time subsequent to the date hereof.

                                                     Very truly yours,

                                                     Lewis, Rice & Fingersh


<PAGE>


                                    EXHIBIT G

                              PLEDGED SUBSIDIARIES


First Bank

First Banks America, Inc.

First Bank & Trust



<PAGE>


                                    EXHIBIT H

                               LIST OF AFFILIATES


Hermannhof, Inc.

Tidal Insurance Limited

First Securities America, Inc.

First Services, L.P.

Southside Bancshares, Inc.

Investors of America, Limited Partnership

First Brokerage, Inc.

First Associate Title, Inc.

First Brokerage America LLC

First Title Guaranty LLC

First Banc Mortgage LLC


<PAGE>


                                    EXHIBIT I

                                 IDENTIFICATION
                                       OF
                              FINANCIAL STATEMENTS


(1)      Audited  consolidated  financial  statements for First Banks,  Inc.and
         subsidiaries for the fiscal years ending December 1997
         and 1998.

(2)      Audited  consolidated  financial  statements  for First Banks  America,
         Inc.  and  subsidiaries  for the fiscal  years ending December 1997 and
         1998.

(3)      Unaudited  consolidated  financial statements for First Banks, Inc. and
         subsidiaries, both prepared by Borrower, for the period ending June 30,
         1999.

(4)      Unaudited  consolidated  financial statements for  First Banks America,
         Inc. and subsidiaries, both prepared by Borrower, for the period ending
         June 30, 1999.




<PAGE>


                                    EXHIBIT J

                            OWNERSHIP OF SUBSIDIARIES


First Bank
10,000 Shares Owned/Controlled By First Banks, Inc. (100%)

         First Land Trustee Corp.
         50 Common Shares Owned/Controlled by First Bank (100%)

         FB Commercial Finance, Inc.
         100 Common Shares Owned/Controlled by First Bank (100%)

First Banks America, Inc.
2,210,581 Common Shares  Owned/Controlled  by First Banks, Inc. (38.73% of total
voting) 2,500,000 Class B Shares  Owned/Controlled  by First Banks, Inc. (43.80%
of total voting)

         First Bank of California
         1,000 Common Shares Owned/Controlled by First Banks America, Inc.(100%)

         First Bank Texas, N.A.
         2,049,000  Common  Shares  Owned/Controlled  by  Sundowner  Corporation
         (100%)

         Redwood Bancorp
         25,000 Shares Owned/Controlled by First Banks America, Inc. (100%)

                  Redwood Bank
                  465,000 Shares Owned/Controlled by Redwood Bancorp (100%)

                  Redwood National Mortgage Co.
                  30,000 Shares Owned/Controlled by Redwood Bancorp (100%)

                  Eucalyptus Financial Corp.
                  1,000 Shares Owned/Controlled by Redwood Bancorp (100%)

First Bank & Trust
         4,725,396 Shares Owned/Controlled by First Banks, Inc. (100%)



<PAGE>





                                    EXHIBIT K

                                LIST OF ADDRESSES

If to the Borrower:              First Banks, Inc.
                                 11901 Olive Blvd.
                                 Creve Coeur, MO  63141
                                 Attention:  Allen H. Blake
                                               Chief Financial Officer

   with a copy to (for notice requirements under Article VIII hereof only):

                                 Lewis, Rice & Fingersh
                                 500 North Broadway
                                 St. Louis, Missouri  63102
                                 Attention:  Thomas C. Erb, Esq.

If to Mercantile Bank
National Association:            One Mercantile Center
                                 Tram 11-5
                                 7th & Washington
                                 St. Louis, MO  63101
                                 Attention:  David C. Buettner

If to Harris Trust
and Savings Bank:                111 W. Monroe
                                 Chicago, Illinois 60603
                                 Attention:  Patrick Horne

If to American National
Bank and Trust Company
of Chicago:                      120 South LaSalle St.
                                 Chicago, Illinois 60603-3400
                                 Attention:  Dave DeWitt

If to The Frost National
Bank:                            2001 Bryan Street, Suite 525
                                 Dallas, Texas  75201
                                 Attention:  Jerry L. Crutsinger, Vice President
                                             Correspondent Banking

If to Norwest Bank
Minnesota, National
Association:                     100 East Wisconsin Avenue
                                 Milwaukee, Wisconsin  53202-4101
                                 Attention:  Alfonso Buscemi


<PAGE>


                                  SCHEDULE 4.05

                                OTHER AGREEMENTS



                                      NONE


<PAGE>


                                  SCHEDULE 4.06


                                   LITIGATION

         1. Reliance  National  Indemnity Re:  Wildwood  Estates.  First Bank of
California  issued two set-aside letters to Planet Insurance (whose successor is
Reliance   National   Indemnity)  in  connection  with  the  construction  of  a
development known as Wildwood Estates by a borrower.  Planet subsequently issued
two surety bonds to the county where the  development  is located  which secured
the  anticipated  cost of certain of the  improvements.  The  borrower/developer
subsequently  defaulted.  The  county  waived  the  requirements  of  the  first
set-aside letter, but not the second. Consequently,  the bank has exposure under
the second  set-aside  letter and the surety bond issued against it. The maximum
amount of that exposure is  $1,122,000;  the bank and the county have not agreed
upon the amount which is due and payable under the second  surety bond.  Counsel
is unable to express an  opinion  on the  likelihood  that a claim on the second
letter will ultimately be made, and if it were, on the probable  outcome of such
a claim. The bank established an accrual in the amount of $1,122,000 in 1996 (GL
#27803).  On August 23, 1999 the parties reached a settlement which will require
the bank to pay approximately  $765,000 plus expenses.  The settlement documents
are in process and final  resolution  is expected by  September  30,  1999.  The
current amount of the accrual exceeds the settlement amount.

         2. Bittner vs. Bashore.  Fifty-seven  investors in real estate projects
filed suit in November,  1996, against Huntington National Bank, a bank acquired
by First Bank and Trust, to recover their investments,  which were lost when the
projects failed. Huntington National Bank's former Chairman,  Charles Hermanson,
and President, Kirk Bashore, were also named as defendants.  Huntington National
Bank had loaned  funds to a sponsor of the real estate  investment  (one Tobin),
but did not  provide  loans  related to the real  estate  projects  in which the
plaintiffs  invested.  The  total  claim is $28  million,  but it  appears  from
discovery to date that the actual amount of the  plaintiff's  investments  which
were subject to loss was  significantly  less.  Another  suit was filed  against
Tobin by forty different investors in January,  1998. In April, 1998, First Bank
and Trust was served as an added  defendant  in this action as well.  The Bank's
motions for summary adjudication of issues have been granted. As a result of the
success of those motions,  the remaining  claims against the Bank are for aiding
and abetting  the  violation of certain  California  securities  laws and fraud.
Discovery is continuing.  A third motion for summary  judgment was filed in June
1999 for  dismissal of the  remaining  fraud  claim,  but has not yet been ruled
upon.  Mediation with the plaintiffs is in the process of being scheduled before
a mediator in San Francisco and it is  anticipated  this mediation will occur on
September 3, 1999. If the case is not resolved by summary judgment, mediation or
otherwise,  trial is scheduled for September 27, 1999. The potential  outcome of
these cases cannot yet be predicted.

         3. Larry  Rothman  vs.  First Bank & Trust.  This suit was filed by Mr.
Rothman of BTAW, Inc. for general damages  allegedly caused by the bank bringing
proceedings  to foreclose a mortgage  securing  indebtedness  of BTAW,  Inc. Mr.
Rothman,  who is an  attorney,  is  alleging  damages of $15  million.  The Bank
believes  that its loss  potential is  significantly  less than $15 million.  On
October 27, 1998,  the Superior  Court granted the motion of First Bank & Trust,
Donald  Housser,  Vice  President -- Special  Assets,  and Arthur  Jarvis Cohen,
Attorney for First Bank and Trust for summary judgment.  Larry Rothman has filed
a notice of appeal, which attorney Cohen believes has little merit.

         4.  Thomas  Barnes,  et al vs. The Estate of  William J.  Kaufman.  The
owners  of 31 homes in Green  Jade  Estates  Subdivision  in  Jefferson  County,
Missouri,  filed suit against First Bank and others in May, 1997. The Green Jade
Estates  Subdivision was plagued by soil movement that  eventually  damaged many
homes. The Sheahan Financial Company,  predecessor to First Bank,  originated 14
of the  mortgages on the homes owned by  plaintiffs.  An additional 4 loans were
originated by other mortgagees and purchased by First Bank. The petition alleges
that the bank engaged in a conspiracy  to defraud the  plaintiffs  by aiding the
other defendants and by providing  financing to plaintiffs when the bank knew of
soil  problems.  The  petition  seeks  $75,000  damages per home,  $100,000  per
plaintiff  and  unspecified  punitive  damages.  A bank  motion to  dismiss  was
granted,  but plaintiffs were given leave to file an amended  petition within 90
days,  which they did. In May, 1998, the bank responded to the amended  petition
by filing  another  motion to dismiss.  The motion to dismiss was granted by the

<PAGE>

trial court.  The plaintiffs may have the opportunity to appeal this decision at
the conclusion of the trial involving the other named defendants.  A petition in
a similar case by other homeowners in the same subdivision was dismissed in 1995
and the dismissal was upheld on appeal.

         5. First Banks,  Inc. was served on June 1, 1998 with a complaint filed
by Thomas  Steiner.  In early  1995,  First  Banks,  Inc.  purchased  all of the
outstanding  shares of stock of Irvine City Financial,  including Mr. Steiner's.
First Banks,  Inc. set off  indebtedness of Mr. Steiner to Irvine City Financial
against the amount owed to Mr. Steiner for the stock. That setoff is the subject
of the suit. The total amount of the plaintiff's claims is about $900,000. It is
too early to predict the outcome.  The setoff amount was about $90,000. The case
is presently in discovery  and the court has not  established  a trial date.  To
date, no significant deadlines have been established with respect to this case.



<PAGE>


                                  SCHEDULE 4.08


                            ERISA - PLAN TERMINATIONS


1.       As of December 31, 1993 the First Banks,  Inc. Money  Purchase  Pension
         Plan was  terminated  and replaced  effective  April 1,   1994 with the
         First Banks, Inc. ss.401K Profit Sharing Plan.

2.       Effective March 31, 1994,  Heritage National Bank was merged into First
         Bank (Creve Coeur,  Missouri).  Heritage  National  Bank  maintained an
         Employee  Stock   Ownership   Plan  which,   incidental  to  the  First
         Banks/Heritage National Bank merger, has been terminated.

3.       The First  Federal  Savings  Bank of Proviso  Township  was merged into
         First Bank A Savings Bank  effective  January 13, 1994.  First  Federal
         Savings  Bank of Proviso  Township  maintained  a defined  benefit plan
         which is in the process of being terminated.

4.       First Banks, Inc., acquired a majority interest in BancTEXAS Group Inc.
         effective August 31, 1994.  BancTEXAS maintains two types of retirement
         benefit plans,  a defined  benefit plan,  which has been frozen,  and a
         401K  Profit  Sharing Plan,  which mirrors the First Banks,  Inc.  401K
         Profit Sharing Plan.

5.       River Valley Holdings,  Inc., was purchased by First Bank FSB effective
         January 3, 1995.  River Valley Holdings,  Inc. maintained a 401K Profit
         Sharing Plan which has been merged into  the  First  Banks,  Inc.  401K
         Profit Sharing Plan effective July 1, 1995.

6.       CCB Bancorp,  Inc. was   purchased   by  First  Banks,  Inc.  effective
         March 15, 1995. CCB Bancorp,  Inc.  maintained a 401K   Retirement Plan
         which  has  been  merged into the First Banks, Inc. 401K Profit Sharing
         Plan effective July 1, 1995.

7.       La Cumbre Savings Bank was purchased  by CCB  Bancorp,  Inc. (which was
         purchased   by   First  Banks,  Inc.  on    March 15, 1995)   effective
         September 1, 1995. La Cumbre Savings Bank  maintained  a 401(k)  Profit
         Sharing  Plan  which  merged  into  the First Banks, Inc. 401(k) Profit
         Sharing Plan effective February 1996.

8.       Queen   City   Bank   was  purchased  by First  Banks,  Inc.  effective
         July 21, 1995.  Queen City Bank  maintained a 401(k)  Profit    Sharing
         Plan  which merged  into  the  First Banks, Inc. 401(k) Profit Sharing
         Plan effective June 1996.

9.       First Banks, Inc. acquired a majority interest in First Commercial Bank
         effective August 23, 1995, First Commercial Bank maintains two types of
         retirement  benefit plans, a ESOP (Employee Stock Ownership Plan) and a
         401(k)  Profit  Sharing Plan,  which now mirrors the First Banks,  Inc.
         401(k) Profit Sharing Plan effective July 1, 1996.


<PAGE>


                                SCHEDULE 8.01(10)

                               REGULATORY ACTIONS

None.





<PAGE>

                                                                Exhibit 10.12
                                FIRST BANKS, INC.
                          MANAGEMENT SERVICES AGREEMENT

     This Management  Services Agreement (the Agreement) is made this 1st day of
June 1999, by and between Redwood Bank, a California  banking  corporation  (the
Bank) and First Banks, Inc., a Missouri corporation (First Banks).

     WHEREAS  First  Banks is a  multi-bank  and thrift  holding  company  which
provides  certain  services  to  its  subsidiary  financial  institutions  on  a
centralized basis and is willing to provide such services to Bank, and

     WHEREAS the Bank is currently  operating as a commercial and retail bank in
the  State of  California,  and  desires  to avail  itself  of such  centralized
services in connection with its operations.

Services to be performed:

     First Banks shall undertake to perform certain  services for the benefit of
the Bank,  and any  affiliates  thereof,  including,  but not  limited  to those
enumerated  below.  These  services may be provided by employees of First Banks,
any subsidiary of First Banks,  or external  sources  retained by First Banks on
behalf of the Bank and/or its  affiliates.  First  Banks will  prepare a monthly
statement to the Bank  indicating  the nature of the services  performed and the
fees charged for such services.

     Services  performed  by employees of First Banks will be billed to the Bank
on the basis of actual  hours  required to perform the services  using  standard
hourly rates established for each type of service. The hourly rates in effect as
of the date of this  Agreement  are listed in  Attachment A. These rates will be
reviewed  periodically  and adjusted as necessary to reflect First Banks current
costs in  delivering  the  services,  but may only be  adjusted  once during any
calendar  year. The Bank will be provided at least ninety (90) days notice prior
to any  change  in the  hourly  rates to be used The  Bank  may  terminate  this
Agreement  at any time if any rate  increase  is deemed  excessive  by the Banks
Board of Directors.

     Services  performed  by  employees  of the  Bank for the  benefit  of other
subsidiaries  of First Banks,  or services  performed by other  subsidiaries  of
First  Banks for the  benefit  of the Bank  will be  charged  to the  subsidiary
receiving  the service  based on actual  hours  required to perform the services
suing the same standard  hourly rates as used for employees of First Banks.  The
subsidiary management fees statement for the amount charged for the services.

     Services  provided by external sources will be charged to the Bank at First
Banks cost.  Services which benefit more than one  subsidiary  will be allocated
between them using the basis deemed most appropriate for the particular  service
and the charge for that service.

Included in the services to be provided will be the following:

1.       Lending:

         a.     Loan Review
         b.     Loan administration and support
         c.     Loan and business development
         d.     Loan servicing
         e.     Loan collection and workout

2.       Human resources:

         a.     Human resources administration
         b.     Records and compliance
         c.     Employee recruiting and training
         e.     Other human resources activities

<PAGE>


3.       Corporate audit:

         a.     Assisting external auditors
         b.     Internal auditing
         c.     Compliance and Community Reinvestment Act assistance
         d.     Assisting examinations and replies to reports
         e.     Other audit activities

4.       General Accounting

         a.     Regulatory examinations and compliance
         b.     Income tax returns and tax audits
         c.     Estimated tax payments and tax accruals
         d.     State and local taxes
         e.     Fixed asset records and accounting
         f.     General accounting assistance
         g.     Regulatory reporting
         h.     SEC reporting and compliance
         I.     Systems and procedures
         j.     Other accounting activities

  5.     Asset/liability management
  6.     Investments
  7.     Planning and budgets
  8.     Branch administration activities
  9.     Purchasing and accounts payable
 10.     Preparation for and participation in meetings

     In addition,  First Banks will contract for certain services to be provided
to the Bank and its affiliates, which may be charged through management fees, or
through separate direct charges to the Bank. These will include  advertising and
promotional expenses, property and liability insurance,  certain external legal,
audit and tax assistance, and employee benefit programs.  Generally, charges for
insurance and employee benefits will be made through separate statements outside
the management  fee structure.  Charges for other items will usually be included
in management fee statements.

     Travel expenses  associated with performance of management services will be
changed to the Bank based on the expense  reports  received from the  employees.
Travel time, or other non-productive time, will not be charged to the Bank.

Activities not includable in management fees:

  1.     Accounting

         a.     Parent company accounting, including:

                (1)  General  ledger (2)  Accounts  payable  and bill paying (3)
                Consolidations  and financial  reporting (4) Regulatory  reports
                and examinations

(5)      SEC accounting and reporting

         b.     Accounting,  taxes and other services performed for entities not
                paying  management fees, such as second tier holding  companies,
                FirstServ, Inc. and inactive corporations.




<PAGE>


2.       Mergers and acquisitions:

         a.     Negotiations and contracts
         b.     Regulatory matters and applications
         c.     Due diligence and analysis
         d.     Operations and consolidations
         e.     Human resources and other activities

3.       Financing

         a.     Working with current or prospective lenders
         b.     Loan agreements and contracts
         c.     Due diligence and rating agencies

Expenses not includable in management fees:

     Included in First  Banks  expenses  are  various  items which are not to be
included  in the base for  calculating  management  fees.  Among  these  are the
following:

  1.     Interest expense
  2.     Amortization of deferred inter-company gains and losses
  3.     Land leases for possible future bank sites
  4.     Legal, accounting and advertising expenses in excess of amounts charged
         to the Bank and other subsidiaries on a specific basis.
  5.     Contributions
  6.     Amortization of purchase adjustments and excess cost
  7.     Provision for income taxes

     First Banks may identify other accounts or specific expense items which are
deemed  inappropriate  to include in the base for management  fees. These may be
excluded at the discretion of First Banks as identified.

Billing of fees:

     First  Banks  shall  prepare  and  submit  to the Bank a  monthly  bill for
services  rendered  in  sufficient  detail  to  provide  the  Bank a  basis  for
evaluating the cost/benefit of items charged.  It shall be the responsibility of
First Banks to maintain time reports,  worksheets  and summaries  supporting the
amounts billed.  These will be furnished to the Bank, examiners or auditors upon
request.

     Amounts  billed will be payable to First Banks by either a direct charge to
the Banks account at First Bank (Missouri), or, if appropriate, a credit to that
account.  Management fee  statements  will be provided to the Bank at least five
working days prior to payment.

General:

     The Bank shall make  available to First Banks all records,  facilities  and
personnel  necessary  to enable  First Banks to perform the  services  required.
First Banks shall  furnish the  necessary  forms and  instructions  to the Banks
personnel.  The Bank shall  furnish  all data,  documents  or input  material as
required,  which  material  shall be returned to the Bank when the  services are
completed.

     First  Banks  shall give the same care to Banks work as it gives to its own
work. However, First Banks does not warrant the work free of error, and shall be
liable only for First Banks own gross negligence of willful misconduct.


<PAGE>


     The services  performed under this Agreement by First Banks will be subject
to the  regulations  and  examination  of the Federal or state  agencies  having
supervisory jurisdiction over the Bank and its affiliates and First Banks to the
same extent as if such services were being  performed  solely by Bank on its own
premises.  The  provisions  of  this  Agreement  are  subject  to  modification,
regulation or ruling of any  governmental  agency having  jurisdiction  over the
Bank or its  affiliates  or  First  Banks.  Otherwise  this  Agreement  shall be
modifiable only upon written agreement of the parties thereto.

     First Banks will hold in confidence all  information  relating to the Banks
assets,  liabilities,  business  or affairs,  or those of any of its  customers,
which is  received  by First  Banks in the  course  of  rendering  the  services
hereunder. It will make the same effort to safeguard such information as it does
to protect its own proprietary data.

         The  term  of  the  Agreement  is  for  one  year,   but  it  shall  be
automatically  renewable for additional periods of one year each unless the Bank
shall give ninety (90) days written  notice of  termination  prior to the end of
any term.


     This  Agreement  shall be binding upon the parties and their  successors or
assigns, and may only be amended by a writing executed by both parties.

     IN WITNESS  WHEREOF,  the parties  hereto  have,  by their duly  authorized
officers executed this Agreement this 1st day of June, 1999.

REDWOOD BANK                       FIRST BANKS, INC.


By:     /s/ Anthony S. Dee         By:    /s/ Allen H. Blake
        ------------------                 ------------------

Title:  President                 Title:  President and Chief Operating Officer





<PAGE>


                                FIRST BANKS, INC.
                          MANAGEMENT FEE BILLING RATES
                                 JANUARY 1, 1999


                  Services Provided                               Rate Per Hour
                  Lending:
                     Loan Review                                      $50.00
                     Administration/Support                            40.00
                     Business Development                              60.00
                     Loan Service                                      40.00
                     Loan Collection/Workout                           55.00
                     Other                                             40.00
                  Human Resources:
                     Administration                                    45.00
                     Records/Compliance                                40.00
                     Recruiting/Training                               40.00
                     Payroll/Benefits                                  35.00
                     Other                                             40.00
                  Internal Audit:
                     Assisting External Auditors                       50.00
                     Internal Audit                                    45.00
                     Compliance and CRA                                40.00
                     Examinations/Reports                              45.00
                     Other                                             40.00
                  Accounting:
                     PCO/Consolidated                                  50.00
                     Examinations/Compliance                           50.00
                     Tax Returns                                       66.00
                     Estimated Tax/Accruals                            50.00
                     State Taxes                                       60.00
                     Fixed Assets/Other                                40.00
                     General Accounting Assistance                     45.00
                  `  Regulatory Reports                                50.00
                     SEC Reporting                                     65.00
                     Systems/Procedures                                50.00
                  Mergers and Acquisitions:
                     Negotiations/Contracts                            75.00
                     Regulations/Applications                          50.00
                     Due Diligence                                     50.00
                     Operations/Human Resources                        50.00
                  Asset/Liability Management                           60.00
                  Investments                                          50.00
                  Planning/Budgets                                     50.00
                  Branch Administration:
                     Marketing/Business Development                    45.00
                     Branch Operations                                 45.00
                     Customer Service/Training                         45.00
                     Other                                             45.00
                  Purchasing/Accounts Payable                          50.00
                  Meetings                                             65.00
                  Other                                                45.00



<PAGE>


                                                                Exhibit 10.13
                                FIRST BANKS, INC.
                          MANAGEMENT SERVICES AGREEMENT

     This Management  Services Agreement (the Agreement) is made this 1st day of
September  1999, by and between Century Bank, a California  banking  corporation
(the Bank) and First Banks, Inc., a Missouri corporation (First Banks).

     WHEREAS  First  Banks is a  multi-bank  and thrift  holding  company  which
provides  certain  services  to  its  subsidiary  financial  institutions  on  a
centralized basis and is willing to provide such services to Bank, and

     WHEREAS the Bank is currently  operating as a commercial and retail bank in
the  State of  California,  and  desires  to avail  itself  of such  centralized
services in connection with its operations.

Services to be performed:

     First Banks shall undertake to perform certain  services for the benefit of
the Bank,  and any  affiliates  thereof,  including,  but not  limited  to those
enumerated  below.  These  services may be provided by employees of First Banks,
any subsidiary of First Banks,  or external  sources  retained by First Banks on
behalf of the Bank and/or its  affiliates.  first  Banks will  prepare a monthly
statement to the Bank  indicating  the nature of the services  performed and the
fees charged for such services.

     Services  performed  by employees of First Banks will be billed to the Bank
on the basis of actual  hours  required to perform the services  using  standard
hourly rates established for each type of service. The hourly rates in effect as
of the date of this  Agreement  are listed in  Attachment A. These rates will be
reviewed  periodically  and adjusted as necessary to reflect First Banks current
costs in  delivering  the  services,  but may only be  adjusted  once during any
calendar  year. The Bank will be provided at least ninety (90) days notice prior
to any  change  in the  hourly  rates to be used The  Bank  may  terminate  this
Agreement  at any time if any rate  increase  is deemed  excessive  by the Banks
Board of Directors.

     Services  performed  by  employees  of the  Bank for the  benefit  of other
subsidiaries  of First Banks,  or services  performed by other  subsidiaries  of
First  Banks for the  benefit  of the Bank  will be  charged  to the  subsidiary
receiving  the service  based on actual  hours  required to perform the services
suing the same standard  hourly rates as used for employees of First Banks.  The
subsidiary management fees statement for the amount charged for the services.

     Services  provided by external sources will be charged to the Bank at First
Banks cost.  Services which benefit more than one  subsidiary  will be allocated
between them using the basis deemed most appropriate for the particular  service
and the charge for that service.

Included in the services to be provided will be the following:

1.       Lending:

         a.     Loan Review
         b.     Loan administration and support
         c.     Loan and business development
         d.     Loan servicing
         e.     Loan collection and workout

2.       Human resources:

         a.     Human resources administration
         b.     Records and compliance
         c.     Employee recruiting and training
         e.     Other human resources activities


<PAGE>


3.       Corporate audit:

         a.     Assisting external auditors
         b.     Internal auditing
         c.     compliance and Community Reinvestment Act assistance
         d.     Assisting examinations and replies to reports
         e.     Other audit activities

4.       General Accounting

         a.     Regulatory examinations and compliance
         b.     Income tax returns and tax audits
         c.     Estimated tax payments and tax accruals
         d.     State and local taxes
         e.     Fixed asset records and accounting
         f.     General accounting assistance
         g.     Regulatory reporting
         h.     SEC reporting and compliance
         I.     Systems and procedures
j.       Other accounting activities

  5.     Asset/liability management
  6.     Investments
  7.     Planning and budgets
  8.     Branch administration activities
  9.     Purchasing and accounts payable
 10.     Preparation for and participation in meetings

     In addition,  First Banks will contract for certain services to be provided
to the Bank and its affiliates, which may be charged through management fees, or
through separate direct charges to the Bank. These will include  advertising and
promotional expenses, property and liability insurance,  certain external legal,
audit and tax assistance, and employee benefit programs.  Generally, charges for
insurance and employee benefits will be made through separate statements outside
the management  fee structure.  Charges for other items will usually be included
in management fee statements.

     Travel expenses  associated with performance of management services will be
changed to the Bank based on the expense  reports  received from the  employees.
Travel time, or other non-productive time, will not be charged to the Bank.

Activities not includable in management fees:

1.       Accounting

         a.     Parent company accounting, including:

                (1)  General  ledger (2)  Accounts  payable  and bill paying (3)
                Consolidations  and financial  reporting (4) Regulatory  reports
                and examinations

(5)      SEC accounting and reporting

b.              Accounting,  taxes and other services performed for entities not
                paying  management fees, such as second tier holding  companies,
                FirstServ, Inc. and inactive corporations.


<PAGE>



  2.     Mergers and acquisitions:

         a.     Negotiations and contracts
         b.     Regulatory matters and applications
         c.     Due diligence and analysis
         d.     Operations and consolidations
         e.     Human resources and other activities

3.       Financing

         a.     Working with current or prospective lenders
         b.     Loan agreements and contracts
         c.     Due diligence and rating agencies

Expenses not includable in management fees:


     Included in First  Banks  expenses  are  various  items which are not to be
included  in the base for  calculating  management  fees.  Among  these  are the
following:

  1.     Interest expense
  2.     Amortization of deferred inter-company gains and losses
  3.     Land leases for possible future bank sites
  4.     Legal, accounting and advertising expenses in excess of amounts charged
         to the Bank and other subsidiaries on a specific basis.
  5.     Contributions
  6.     Amortization of purchase adjustments and excess cost
  7.     Provision for income taxes

     First Banks may identify other accounts or specific expense items which are
deemed  inappropriate  to include in the base for management  fees. These may be
excluded at the discretion of First Banks as identified.

Billing of fees:

     First  Banks  shall  prepare  and  submit  to the Bank a  monthly  bill for
services  rendered  in  sufficient  detail  to  provide  the  Bank a  basis  for
evaluating the cost/benefit of items charged.  It shall be the responsibility of
First Banks to maintain time reports,  worksheets  and summaries  supporting the
amounts billed.  These will be furnished to the Bank, examiners or auditors upon
request.

     Amounts  billed will be payable to First Banks by either a direct charge to
the Banks account at First Bank (Missouri), or, if appropriate, a credit to that
account.  Management fee  statements  will be provided to the Bank at least five
working days prior to payment.

General:

     The Bank shall make  available to First Banks all records,  facilities  and
personnel  necessary  to enable  First Banks to perform the  services  required.
First Banks shall  furnish the  necessary  forms and  instructions  to the Banks
personnel.  The Bank shall  furnish  all data,  documents  or input  material as
required,  which  material  shall be returned to the Bank when the  services are
completed.

     First  Banks  shall give the same care to Banks work as it gives to its own
work. However, First Banks does not warrant the work free of error, and shall be
liable only for First Banks own gross negligence of willful misconduct.


<PAGE>


     The services  performed under this Agreement by First Banks will be subject
to the  regulations  and  examination  of the Federal or state  agencies  having
supervisory jurisdiction over the Bank and its affiliates and First Banks to the
same extent as if such services were being  performed  solely by Bank on its own
premises.  The  provisions  of  this  Agreement  are  subject  to  modification,
regulation or ruling of any  governmental  agency having  jurisdiction  over the
Bank or its  affiliates  or  First  Banks.  Otherwise  this  Agreement  shall be
modifiable only upon written agreement of the parties thereto.

     First Banks will hold in confidence all  information  relating to the Banks
assets,  liabilities,  business  or affairs,  or those of any of its  customers,
which is  received  by First  Banks in the  course  of  rendering  the  services
hereunder. It will make the same effort to safeguard such information as it does
to protect its own proprietary data.

     The term of the  Agreement is for one year,  but it shall be  automatically
renewable  for  additional  periods of one year each  unless the Bank shall give
ninety (90) days written notice of termination prior to the end of any term.


     This  Agreement  shall be binding upon the parties and their  successors or
assigns, and may only be amended by a writing executed by both parties.

     IN WITNESS  WHEREOF,  the parties  hereto  have,  by their duly  authorized
officers executed this Agreement this 1st day of September, 1999.

CENTURY BANK                                    FIRST BANKS, INC.


By: /s/ Pedro C. Jaminola                       By: /s/ Allen H. Blake
-------------------------                       ----------------------

Title: President and Chief Executive Officer    Title: Executive Vice President
--------------------------------------------    -------------------------------





<PAGE>


                                FIRST BANKS, INC.
                          MANAGEMENT FEE BILLING RATES
                                 JANUARY 1, 1999


      Services Provided                                        Rate Per Hour
      Lending:
         Loan Review                                               $50.00
         Administration/Support                                     40.00
         Business Development                                       60.00
         Loan Service                                               40.00
         Loan Collection/Workout                                    55.00
         Other                                                      40.00
      Human Resources:
         Administration                                             45.00
         Records/Compliance                                         40.00
         Recruiting/Training                                        40.00
         Payroll/Benefits                                           35.00
         Other                                                      40.00
      Internal Audit:
         Assisting External Auditors                                50.00
         Internal Audit                                             45.00
         Compliance and CRA                                         40.00
         Examinations/Reports                                       45.00
         Other                                                      40.00
      Accounting:
         PCO/Consolidated                                           50.00
         Examinations/Compliance                                    50.00
         Tax Returns                                                66.00
         Estimated Tax/Accruals                                     50.00
         State Taxes                                                60.00
         Fixed Assets/Other                                         40.00
         General Accounting Assistance                              45.00
      `  Regulatory Reports                                         50.00
         SEC Reporting                                              65.00
         Systems/Procedures                                         50.00
      Mergers and Acquisitions:
         Negotiations/Contracts                                     75.00
         Regulations/Applications                                   50.00
         Due Diligence                                              50.00
         Operations/Human Resources                                 50.00
      Asset/Liability Management                                    60.00
      Investments                                                   50.00
      Planning/Budgets                                              50.00
      Branch Administration:
         Marketing/Business Development                             45.00
         Branch Operations                                          45.00
         Customer Service/Training                                  45.00
         Other                                                      45.00
      Purchasing/Accounts Payable                                   50.00
      Meetings                                                      65.00
      Other                                                         45.00