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 March 31, 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                              April 30, 1999
                  -----                              --------------

      Common Stock, $250.00 par value                    23,661




<PAGE>




                                                 First Banks, Inc.

                                                       INDEX
<TABLE>
<CAPTION>


                                                                                                        Page

PART I            FINANCIAL INFORMATION


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

     Item 2.      Management's Discussion and Analysis of Financial
                    Condition and Results of Operations..........................................      -11-


PART II.          OTHER INFORMATION

     Item 6.      Exhibits and Reports on Form 8-K...............................................      -22-


SIGNATURES.......................................................................................      -23-



</TABLE>





<PAGE>
<TABLE>
<CAPTION>



                         PART I - FINANCIAL INFORMATION
                          Item 1. Financial Statements

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




                                                                                March 31,         December 31,
                                                                                  1999                1998
                                                                                  ----                ----


                                   ASSETS
                                   ------

Cash and cash equivalents:
<S>                                                                          <C>                     <C>    
   Cash and due from banks...............................................    $   148,432             174,329
   Interest-bearing deposits with other financial
    institutions with maturities of three months or less.................          2,085               3,733
   Federal funds sold....................................................         27,700              36,700
                                                                             -----------          ----------
         Total cash and cash equivalents.................................        178,217             214,762
                                                                             -----------          ----------

Investment securities:
   Trading, at fair value................................................             --               3,425
   Available for sale, at fair value.....................................        442,272             509,695
   Held to maturity, at amortized cost (fair value of
      $23,376 and $22,568 at March 31, 1999 and
      December 31,1998, respectively)....................................         22,650              21,676
                                                                             -----------          ----------
         Total investment securities.....................................        464,922             534,796
                                                                             -----------          ----------

Loans:
   Commercial, financial and agricultural................................        937,633             920,007
   Real estate construction and development..............................        791,534             720,910
   Real estate mortgage..................................................      1,615,842           1,529,177
   Consumer and installment .............................................        300,679             282,549
   Loans held for sale...................................................        125,324             135,619
                                                                             -----------          ----------
       Total loans ......................................................      3,771,012           3,588,262
   Unearned discount.....................................................         (6,604)             (8,157)
   Allowance for possible loan losses....................................        (65,239)            (60,970)
                                                                             -----------          ----------
         Net loans.......................................................      3,699,169           3,519,135
                                                                             -----------          ----------

Bank premises and equipment, net of accumulated
   depreciation and amortization.........................................         70,478              63,848
Intangibles associated with the purchase of subsidiaries.................         44,045              36,534
Mortgage servicing rights, net of amortization...........................          9,838               9,825
Accrued interest receivable..............................................         27,778              28,465
Other real estate........................................................          3,376               3,709
Deferred income taxes....................................................         50,489              46,848
Other assets.............................................................         86,322              96,888
                                                                             -----------          ----------
         Total assets....................................................    $ 4,634,634           4,554,810
                                                                             ===========          ==========

</TABLE>




<PAGE>


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


                                                                             March 31,              December 31,
                                                                               1999                    1998
                                                                               ----                    ----


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

Deposits:
    Demand:
<S>                                                                        <C>                         <C>    
      Non-interest-bearing............................................     $   540,589                 561,383
      Interest-bearing................................................         366,960                 377,435
    Savings...........................................................       1,288,518               1,198,567
    Time:
      Time deposits of $100 or more...................................         240,466                 219,996
      Other time deposits.............................................       1,627,892               1,582,604
                                                                           -----------             -----------
         Total deposits...............................................       4,064,425               3,939,985
Other borrowings......................................................          67,376                 121,331
Notes payable.........................................................          50,000                  50,048
Accrued interest payable..............................................           9,855                   5,817
Deferred income taxes.................................................          11,887                  10,920
Accrued and other liabilities.........................................          24,737                  20,652
Minority interest in subsidiary.......................................          11,768                  15,251
                                                                           -----------             -----------
         Total liabilities............................................       4,240,048               4,164,004
                                                                           -----------             -----------

Guaranteed preferred beneficial interests in:
   First Banks, Inc. subordinated debenture...........................          83,315                  83,288
   First Banks America, Inc. subordinated debenture...................          44,171                  44,155
                                                                           -----------             -----------
         Total guaranteed preferred beneficial interests in
           subordinated debentures....................................         127,486                 127,443
                                                                           -----------             -----------

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

Preferred stock:
    $1.00 par value, 5,000,000 shares authorized; no shares issued
       and outstanding at March 31, 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.......................................................           2,815                     780
Retained earnings.....................................................         235,942                 231,867
Accumulated other comprehensive income................................           9,365                  11,738
                                                                           -----------             -----------
               Total stockholders' equity.............................         267,100                 263,363
                                                                           -----------             -----------
               Total liabilities and stockholders' equity.............     $ 4,634,634               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
                                                                                                        March 31,
                                                                                                        ---------
                                                                                                   1999          1998
                                                                                                   ----          ----

Interest income:
<S>                                                                                             <C>            <C>   
     Interest and fees on loans..............................................................   $ 74,675       66,738
     Investment securities...................................................................      7,662       11,056
     Federal funds sold and other............................................................        223        1,136
                                                                                                --------     --------
           Total interest income.............................................................     82,560       78,930
                                                                                                --------     --------
Interest expense:
     Deposits:
       Interest-bearing demand...............................................................      1,114        1,474
       Savings...............................................................................     10,929        9,553
       Time deposits of $100 or more.........................................................      2,775        3,044
       Other time deposits...................................................................     21,130       24,017
     Interest rate exchange agreements, net..................................................      1,283          989
     Notes payable and other borrowings......................................................      1,735        1,524
                                                                                                --------     --------
           Total interest expense............................................................     38,966       40,601
                                                                                                --------     --------
           Net interest income...............................................................     43,594       38,329
                                                                                                --------     --------
Provision for possible loan losses...........................................................      2,490        2,100
                                                                                                --------     --------
           Net interest income after provision for possible loan losses......................     41,104       36,229
                                                                                                --------     --------
Noninterest income:
     Service charges on deposit accounts and customer service fees...........................      3,882        3,375
     Credit card fees........................................................................         26          862
     Loan servicing fees, net................................................................        221          299
     Gain on mortgage loans sold and held for sale...........................................      2,332        1,038
     Net gain on sales of available-for-sale securities......................................        677           92
     Net gain (loss) on sales of trading securities..........................................       (303)          58
     Other...................................................................................      2,768        2,070
                                                                                                --------     --------
           Total noninterest income..........................................................      9,603        7,794
                                                                                                --------     --------
Noninterest expense:
     Salaries and employee benefits..........................................................     14,502       12,879
     Occupancy, net of rental income.........................................................      2,883        2,423
     Furniture and equipment.................................................................      1,901        1,587
     Federal Deposit Insurance Corporation premiums..........................................        332          375
     Postage, printing and supplies..........................................................      1,142        1,406
     Data processing fees....................................................................      4,536        2,966
     Legal, examination and professional fees................................................      1,320        1,056
     Credit card.............................................................................        168          792
     Communications..........................................................................        681          726
     Advertising and business development....................................................        659          865
     Gain (loss) on sales of other real estate, net of expenses..............................        (53)         380
     Guaranteed preferred debentures.........................................................      3,014        2,021
     Other...................................................................................      4,402        4,583
                                                                                                --------     --------
           Total noninterest expense.........................................................     35,487       32,059
                                                                                                --------     --------
           Income before provision for income taxes and minority interest in income
              of subsidiary..................................................................     15,220       11,964
Provision for income taxes...................................................................      5,638        4,256
                                                                                                --------     --------
           Income before minority interest in income of subsidiary...........................      9,582        7,708
Minority interest in income of subsidiary....................................................        311          342
                                                                                                --------     --------
           Net income........................................................................      9,271        7,366
Preferred stock dividends....................................................................        196          197
                                                                                                --------     --------
           Net income available to common stockholders.......................................   $  9,075        7,169
                                                                                                ========     ========
Earnings per share:
     Basic...................................................................................   $ 383.52       302.99
     Diluted.................................................................................     372.57       293.85
                                                                                                ========     ========
Weighted average shares of common stock outstanding..........................................     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)
             (dollars expressed in thousands, except per share data)
        Three months ended March 31, 1999 and 1998 and nine months ended
                               December 31, 1998

<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
Three months ended March 31, 1998:
     Comprehensive income:
       Net income.........................................       --      --        --       --    7,366    7,366   --      7,366
       Other comprehensive income net of tax (1) -
         Unrealized gains on securities, net of
           reclassification adjustment (2)................       --      --        --       --      992      --     992      992
                                                                                                -------
       Comprehensive income...............................                                        8,358
                                                                                                =======
     Class A preferred stock dividends, $.30 per share....       --      --        --       --             (193)     --     (193)
     Class B preferred stock dividends, $.03 per share....       --      --        --       --               (4)     --       (4)
     Effect of capital stock transactions of
       majority-owned subsidiary..........................       --      --        --   (1,460)              --      --   (1,460)
                                                            -------     ---      ----   ------          -------  ------ --------
Consolidated balances, March 31, 1998.....................   12,822     241     5,915    2,518          206,312  10,430  238,238
Nine months ended December 31, 1998: Comprehensive income:
       Net income.........................................       --      --        --       --   26,144  26,144      --   26,144
       Other comprehensive income, net of tax (1) -
         Unrealized gains on securities, net of
           reclassification adjustment (2)................       --      --        --       --    1,308      --   1,308    1,308
                                                                                                -------
       Comprehensive income...............................                                       27,452
                                                                                                =======
    Class A preferred stock dividends, $.90 per share.....       --      --        --       --             (576)     --     (576)
    Class B preferred stock dividends, $.08 per share.....       --      --        --       --              (13)     --      (13)
    Effect of capital stock transactions of
       majority-owned subsidiary..........................       --      --        --   (1,738)              --      --   (1,738)
                                                            -------     ---      ----   ------          -------  ------ --------
Consolidated balances, December 31, 1998..................   12,822     241     5,915      780          231,867  11,738  263,363
Three months ended March 31, 1999: Comprehensive income:
       Net income.........................................       --      --        --       --    9,271   9,271      --    9,271
       Other comprehensive income, net of tax (1) -
         Unrealized losses on securities, net of
           reclassification adjustment (2) ...............       --      --        --       --   (2,373)     --   (2,373) (2,373)
                                                                                                -------
       Comprehensive income...............................                                        6,898
                                                                                                =======
    Class A preferred stock dividends, $.30 per share.....       --      --        --       --             (192)     --     (192)
    Class B preferred stock dividends, $.03 per share.....       --      --        --       --               (4)     --       (4)
    Effect of capital stock transactions of
       majority-owned subsidiary..........................       --      --        --   (2,965)              --      --   (2,965)
    Reclassification of retained earnings.................       --      --        --    5,000           (5,000)     --       --
                                                            -------     ---     -----   ------          -------   ----- --------
Consolidated balances, March 31, 1999.....................  $12,822     241     5,915    2,815          235,942   9,365  267,100
                                                           ========    ====     =====   ======          =======   ===== ========
----------------------------
(1) Components of other comprehensive income are shown net of tax.
(2) Disclosure of reclassification adjustment:

                                                                                        Three months ended   Nine months ended
                                                                                            March 31,          December 31,   
                                                                                       ---------------        ---------------
                                                                                           1999    1998            1998
                                                                                           ----    ----            ----

     Unrealized gains (losses) arising during the period............................  $  (1,934)   1,052          2,201
     Less: reclassification adjustment for gains included in net income.............        439       60            893
                                                                                        -------    -----          -----
     Unrealized gain (loss) on securities...........................................  $  (2,373)     992          1,308
                                                                                        =======    =====          =====
</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>
                                                                                       Three months ended
                                                                                            March 31,      
                                                                                       ------------------      
                                                                                     1999              1998
                                                                                     ----              ----
Cash flows from operating activities:
<S>                                                                               <C>                  <C>  
     Net income.............................................................      $  9,271             7,366
     Adjustments to reconcile net income to net cash provided
       by (used in) operating activities:
         Depreciation and amortization of bank premises
            and equipment...................................................         1,596             1,245
         Amortization, net of accretion.....................................         3,066             2,580
         Originations and purchases of loans held for sale..................      (161,378)         (102,010)
         Proceeds from the sale of loans held for sale......................       168,532            46,525
         Provision for possible loan losses.................................         2,490             2,100
         Provision for income taxes.........................................         5,638             4,256
         Payments of income taxes...........................................        (1,491)           (2,149)
         Decrease in accrued interest receivable ...........................         1,557               848
         Net decrease (increase) in trading securities......................         3,425            (2,456)
         Interest accrued on liabilities....................................        38,966            40,601
         Payments of interest on liabilities................................       (35,861)          (40,455)
         Gain on sale of branch facility....................................          (247)               --
         Net gain on sales of available for sale securities.................          (677)              (92)
         Other operating activities, net....................................           456             1,346
         Minority interest in income of subsidiary..........................           311               342
                                                                                  --------          --------
              Net cash provided by (used in) operating activities...........        35,654           (39,953)
                                                                                  --------          --------
Cash flows from investing activities:
     Cash (paid) received for acquired entities, net of cash and cash
       equivalents received (paid)..........................................       (17,245)           16,895
     Proceeds from sales of investment securities available for sale........        49,467             4,000
     Maturities of investment securities available for sale.................        54,682           141,989
     Maturities of investment securities held to maturity...................           998               641
     Purchases of investment securities available for sale..................        (7,297)          (78,547)
     Purchases of investment securities held to maturity....................        (1,982)             (800)
     Net increase in loans..................................................       (48,315)           (9,814)
     Recoveries of loans previously charged-off ............................         2,224             2,605
     Purchases of bank premises and equipment...............................        (6,717)           (4,180)
     Other investing activities.............................................        (5,543)           (1,982)
                                                                                  --------          --------
              Net cash provided by investing activities.....................        20,272            70,807
                                                                                  --------          --------
Cash flows from financing activities:
     (Decrease) increase in demand and savings deposits.....................       (37,729)           55,634
     Increase in time deposits..............................................         2,311            33,912
     Decrease in Federal Home Loan Bank advances............................       (50,000)           (1,220)
     (Decrease) increase in securities sold under agreements
       to repurchase........................................................        (3,955)            9,246
     Decrease in notes payable..............................................           (48)           (1,548)
     Payment of preferred stock dividends...................................          (196)             (197)
     Sale of branch facility................................................        (2,854)               --
                                                                                  --------          --------
              Net cash (used in) provided by financing activities ..........       (92,471)           95,827
                                                                                  --------          --------
              Net (decrease) increase in cash and cash equivalents .........       (36,545)          126,681
Cash and cash equivalents, beginning of period .............................       214,762           168,480
                                                                                  --------           -------
Cash and cash equivalents, end of period....................................      $178,217           295,161
                                                                                  ========           =======

Noncash investing and financing activities:
     Loans transferred to other real estate.................................      $    317             1,613
                                                                                  ========         =========
</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 three month period ended
March  31,  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  institututions  (collectively referred to as the Subsidiary Banks) as
follows:

  First Bank, headquartered in St. Louis County, Missouri (First 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 Bancorp, headquartered in San Francisco, California (Redwood),
                and its wholly owned subsidiary:
                   Redwood Bank, headquartered in San Francisco, California
                    (Redwood Bank)
  CCB Bancorp, Inc., headquartered in Newport Beach, California (CCB), and its 
       wholly owned subsidiary:
          First Bank & Trust, headquartered in Newport Beach, California (FB&T).

         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 March 31,  1999,
First Banks' ownership interest in FBA remained at 82.34%.

 (2)     Acquisitions

         On March 4, 1999,  FBA  completed  its  acquisition  of Redwood and its
wholly owned subsidiary,  Redwood Bank, for cash consideration of $26.0 million.
The acquisition  was accounted for using the purchase method of accounting.  The
excess  of the cost  over the fair  value of the net  assets  acquired  was $9.4
million and is being  amortized over 15 years.  The  acquisition 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.  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.



<PAGE>


         First  Banks,  Century  Holding  Corporation  (CHC)  and  Century  Bank
executed a stock purchase  agreement  (Agreement) on May 7, 1999,  providing for
the acquisition of Century Bank, Beverly Hills, California (Century Bank). Under
the  Agreement,  First  Banks  will  purchase  from  CHC all of the  issued  and
outstanding  capital  stock of Century Bank for an estimated  purchase  price of
$31.5 million. Century Bank operates six commercial banking locations in Beverly
Hills,  Los Angeles,  Santa Monica,  Marina del Rey,  Encino and San  Francisco,
California.  At March 31, 1999, Century Bank had $160.3 million in total assets,
$80.9 million in loans,  net of unearned  discount,  $42.1 million in investment
securities and $133.7 million in deposits.  First Banks expects the transaction,
which is subject  to  regulatory  approvals,  to be  completed  during the third
quarter of 1999.

 (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 bank 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 December 31, 1997, 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 March 31, 1999, First Banks and the Subsidiary Banks
were well capitalized.

         At  March  31,  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......................   10.04%     10.28%          8.64%     9.03%            7.68%    7.77%
         First Bank.......................   10.21      10.01           8.95      8.75             7.66     7.46
         FB&T.............................   10.40      10.39           9.15      9.13             7.76     7.60
         FB Texas.........................   11.02      11.37           9.76     10.11             9.20     9.15
         FB California....................   10.92      10.63           9.66      9.37             8.94     8.34
         Redwood Bank (1).................   10.92        --            9.98       --              8.30      --
        
         -----------------------   
         (1) Redwood Bank was acquired by FBA on March 4, 1999.
</TABLE>


<PAGE>


(4)      Business Segment Results

         First Banks' business  segments are First Bank, FB California,  Redwood
Bank, FB Texas,  FB&T 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 and FB&T 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, discount brokerage,  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), the San Francisco - Sacramento  corridor of
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  the
Subsidiary Banks for which it receives loan servicing fees.


<PAGE>


         The business  segment  results are summarized  below and are consistent
with First Banks' internal reporting system which is consistent, 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 March 31, 1999 and  December 31, 1998,  and the
statement of income  information  is presented  for the three months ended March
31, 1999 and 1998,  respectively.  The business  segment results include Redwood
Bank,  which was acquired by FBA on March 4, 1999, for the period  subsequent to
the acquisition date.


<TABLE>
<CAPTION>

                                              First Bank            FB California         Redwood Bank (1)         FB Texas        
                                      -----------------------  --------------------- ---------------------- ---------------------  
                                      March 31,  December 31,  March 31, December 31, March 31,  December 31, March 31, December 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................. $  213,349     252,165     45,837      53,449       32,891       --      35,917     59,914
Loans, net of unearned discount         2,379,568   2,354,937    327,589     314,977      138,601       --     221,150    201,426
Total assets..........................  2,829,735   2,869,648    404,343     410,110      194,084       --     284,592    300,984
Deposits..............................  2,621,417   2,623,157    348,218     363,422      167,160       --     245,377    264,425
Stockholders' equity.................. $  245,936     236,010     42,960      42,825       25,593       --      30,397     30,249
                                       ==========   =========   ========    ========    =========   ======    ========   ========
</TABLE>


<TABLE>
<CAPTION>




                                              First Bank              FB California        Redwood Bank (1)         FB Texas     
                                         --------------------     ------------------     ------------------    -----------------
                                          Three months ended       Three months ended     Three months ended   Three months ended
                                               March 31,                March 31,             March 31,             March 31,    
                                         --------------------      ------------------    --------------------  ------------------
                                          1999          1998        1999        1998        1999        1998     1999       1998
                                          ----          ----        ----        ----        ----        ----     ----       ----
                                                                        (dollars expressed in thousands)

Income statement information:

<S>                                    <C>             <C>          <C>        <C>          <C>                  <C>        <C>  
Interest income....................... $   51,471      52,307       8,000      7,757        1,180         --     5,542      5,237
Interest expense......................     25,327      26,853       3,079      3,316          442         --     2,162      2,100
                                       ----------    --------     -------     ------         ----      -----    ------     ------
   Net interest income................     26,144      25,454       4,921      4,441          738         --     3,380      3,137
Provision for possible loan losses....      2,100       1,600          60        150           --         --        30        150
                                       ----------    --------     -------     ------         ----      -----    ------     ------
   Net interest income after provision
     for possible loan losses.........     24,044      23,854       4,861      4,291          738         --     3,350      2,987
                                       ----------    --------     -------     ------         ----      -----    ------     ------
Noninterest income (2)................      4,694       4,049         609        713           26                  543        379
Noninterest expense (3)...............     16,705      17,397       3,699      3,730          438         --     2,279      2,203
                                       ----------   ---------     -------     ------         ----      -----    ------     ------
   Income before provision for income
     taxes and minority interest in
     income of subsidiary.............     12,033      10,506       1,771      1,274          326         --     1,614      1,163
Provision for income taxes............      4,121       3,560         787        535          164         --       555        410
                                       ----------   ---------     -------     ------         ----      -----    ------     ------
   Income before minority interest
     in income of subsidiary..........      7,912       6,946         984        739          162         --     1,059        753
Minority interest in income of subsidiary                  --          --         --           --         --        --         -- 
                                       ----------   ---------     -------     ------         ----      -----    ------     ------
   Net income......................... $    7,912       6,946         984        739          162         --     1,059        753
                                       ==========   =========     =======     ======         ====      =====    ======     ======
</TABLE>

-----------------
(1   Redwood Bank was acquired by FBA on March 4, 1999.
(2)  FBM  includes  intercompany  loan   servicing fees of $169,000 and $324,000
     for the three months ended March 31,
     1999 and 1998, respectively.
(3)  Corporate  and other  includes  $2.0 million and $1.3 million of guaranteed
     preferred  debenture  expense,  after applicable income tax benefit of $1.0
     million and  $700,000  for the three  months ended March 31, 1999 and 1998,
     respectively.


<PAGE>



<TABLE>
<CAPTION>







                                                                   Corporate, other and
               FB&T                          FBM               intercompany reclassifications         Consolidated Totals    
     --------------------------     ----------------------     ------------------------------         -------------------    
     March 31,     December 31,     March 31, December 31,        March 31,    December 31,        March 31,     December 31,
      1999             1998           1999         1998             1999           1998              1999            1998
      ----             ----           ----         ----             ----           ----              ----            ----
                                              (dollars expressed in thousands)



<S>    <C>            <C>            <C>            <C>            <C>             <C>             <C>              <C>    
       102,701        134,203        12,135         12,199         22,092          22,866          464,922          534,796
       566,374        573,562       129,027        135,619          2,099            (416)       3,764,408        3,580,105
       761,684        793,217       145,093        154,952         15,103          25,899        4,634,634        4,554,810
       670,818        701,406        28,483         35,873        (17,048)        (48,298)       4,064,425        3,939,985
        74,533         75,165         2,417          7,663       (154,736)       (128,549)         267,100          263,363
      ========       ========      ========       ========       ========        ========       ==========         ========

</TABLE>


<TABLE>
<CAPTION>
                                                                   Corporate, other and
               FB&T                            FBM               intercompany reclassifications      Consolidated Totals  
     ------------------------        ---------------------       ------------------------------      -------------------  
        Three months ended             Three months ended            Three months ended               Three months ended
              March 31,                     March 31,                     March 31,                        March 31,       
     ------------------------        ---------------------       ---------------------------      -------------------------
     1999               1998         1999            1998           1999            1998           1999             1998
     ----               ----         ----            ----           ----            ----           ----             ----
                                              (dollars expressed in thousands)



<S> <C>                <C>            <C>             <C>              <C>            <C>           <C>              <C>   
    14,341             12,398         2,007           1,315            19             (84)          82,560           78,930
     6,199              6,494         1,340             941           417             897           38,966           40,601
   -------           --------      --------       ---------      --------         -------       ----------         --------
     8,142              5,904           667             374          (398)           (981)          43,594           38,329
       300                200            --              --            --              --            2,490            2,100
   -------           --------      --------       ---------      --------         -------       ----------         --------

     7,842              5,704           667             374          (398)           (981)          41,104           36,229
   -------           --------      --------       ---------      --------         -------       ----------         --------
     1,243                757         2,725           1,718          (237)            178            9,603            7,794
     6,552              4,768         2,315           1,225         3,499           2,736           35,487           32,059
   -------           --------      --------       ---------      --------         -------       ----------         --------


     2,533              1,693         1,077             867        (4,134)         (3,539)          15,220           11,964
     1,123                510           377             303        (1,489)         (1,062)           5,638            4,256
   -------           --------      --------       ---------      --------         -------       ----------         --------

     1,410              1,183           700             564        (2,645)         (2,477)           9,582            7,708
        --                 --            --              --           311             342              311              342
   -------           --------      --------       ---------      --------         -------       ----------         --------
     1,410              1,183           700             564        (2,956)         (2,819)           9,271            7,366
   =======           ========      ========       =========      ========         =======       ==========         ========

</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  specifically 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 problem.
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 March 31,
1999, First Banks had $4.6 billion in total assets; $3.8 billion in total loans,
net of unearned discount;  $4.1 billion in total deposits; and $267.1 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, discount brokerage,  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 March 31, 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..............................        97              $ 2,974,828           2,508,595        2,649,900
CCB:
     FB&T...............................        21                  761,684             566,374          670,818
FBA:
     FB California......................        10                  404,343             327,589          348,218
     FB Texas...........................         6                  284,592             221,150          245,377
     Redwood:
         Redwood Bank...................         4                  194,084             138,601          167,160


</TABLE>

<PAGE>


                               Financial Condition

         First Banks' total assets  increased by $79.8  million to $4.63 billion
from $4.55  billion at March 31, 1999 and December 31,  1998,  respectively.  As
discussed in Note 2 to the accompanying  consolidated financial statements,  the
acquisition  of Redwood  provided  assets of $183.9  million.  In addition,  net
loans,  excluding the $134.4 million of loans  acquired from Redwood,  increased
$49.9 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 a reduction in  investment
securities   and  federal   funds  sold  of  $69.9  million  and  $9.0  million,
respectively,  which provided  additional  sources of funds for the loan growth.
Total deposits,  excluding the deposits  provided by the acquisition of Redwood,
and other borrowings decreased by $38.5 million and $54.0 million, respectively.
The decrease in other  borrowings  was comprised  primarily of Federal Home Loan
Bank advances.


                              Results of Operations

Net Income

         Net income was $9.27 million,  or $372.57 per share on a diluted basis,
for the three months ended March 31, 1999, compared to $7.37 million, or $293.85
per share on a diluted basis,  for the same period in 1998.  The  improvement in
First Banks'  earnings was primarily a result of increased  net interest  income
and  noninterest  income,  which was  partially  offset by  increased  operating
expenses.  The  increased  net interest  income  reflects an increase in average
interest-earning  assets and the continued  realignment  of the  composition  of
interest-bearing liabilities. The improvement in interest-earning assets results
primarily from the continued growth and  diversification  of the loan portfolio,
while the improvement in  interest-bearing  liabilities  results  primarily from
competitive  pricing and  enhanced  products  and  services.  The  improved  net
interest  income was  partially  offset by a reduction  in the yield on the loan
portfolio  from 8.93% to 8.36% at March 31,  1999 and 1998,  respectively.  This
reduction  reflects  the overall  decline in prime rate  experienced  during the
fourth quarter of 1998.

Net Interest Income

         Net interest income  (expressed on a tax-equivalent  basis) improved to
$43.8 million, or 4.28% of average interest-earning assets, for the three months
ended March 31, 1999, from $38.5 million,  or 4.05% of average  interest-earning
assets, for the same period in 1998.

         The  increased  net  interest  income for 1999 is  attributable  to the
increase  in average  interest-earning  assets of $292.4  million  for the three
months  ended March 31,  1999,  in  comparison  to the same period in 1998.  The
increase is  primarily  attributable  to loans,  which  increased  on average by
$591.8  million for the three months ended March 31, 1999,  over the same period
in 1998.  Contributing  further  to the  improved  net  interest  income was the
decrease in the cost of interest-bearing liabilities to 4.45% from 4.90% for the
three  months  ended March 31, 1999 and 1998,  respectively.  This  reflects the
continual process of realigning the deposit portfolios of acquired entities, the
overall  increase  in the  percentage  of savings  deposits  to total  deposits,
competitive pricing and enhanced products and services.

         Offsetting the increase in net interest income is the  amortization and
periodic  costs of hedging the interest rate risk  position of First Banks.  The
cost of hedging  totaled  $1.3  million and  $975,000 for the three months ended
March 31, 1999 and 1998,  respectively.  The increase in the cost of hedging for
the three months ended March 31, 1999 in  comparison  to the same period in 1998
is  primarily  reflective  of the  liquidation  of a portion  of the  underlying
interest-bearing  liabilities.  This  liquidation  resulted  in  the  additional
recognition of a portion of the related deferred losses on previously terminated
interest rate exchange  agreements.  As more fully  discussed in the "--Interest
Rate Risk  Management"  section of this Form 10-Q, First Banks increased the use
of interest rate exchange  agreements in 1998 to offset the increasing  exposure
to continued reductions in interest rates on its financial condition and results
of operations.


<PAGE>


         The following  table sets forth,  on a  tax-equivalent  basis,  certain
information  relating to First Banks' average  balance  sheet,  and reflects the
average  yield  earned  on   interest-earning   assets,   the  average  cost  of
interest-bearing liabilities and the resulting net interest income for the three
months ended March 31, 1999 and 1998:
<TABLE>
<CAPTION>

                                                                              Three months ended March 31,                 
                                                         ----------------------------------------------------------------- 
                                                                       1999                               1998             
                                                         ------------------------------       ---------------------------- 
                                                                     Interest                            Interest
                                                         Average     income/    Yield/        Average     income/   Yield/
                                                         balance      expense    rate         balance     expense    rate
                                                         -------      -------    ----         -------     -------    ----
                                                                        (dollars expressed in thousands)
                 Assets
                 ------

Interest-earning assets:
<S>                                                  <C>              <C>        <C>      <C>             <C>       <C>
   Loans (1)(2)(3)(4)..............................  $ 3,625,581      74,761     8.36%    $3,033,759      66,815    8.93%
   Investment securities (4).......................      510,844       7,807     6.20        742,338      11,196    6.12
   Federal funds sold..............................       14,854         193     5.27         79,285       1,071    5.48
   Other...........................................        1,074          30    11.33          4,611          65    5.72
                                                      ----------      ------               ---------     -------   
         Total interest-earning assets.............    4,152,353      82,791     8.09      3,859,993      79,147    8.32
                                                                      ------                              ------       
Nonearning assets..................................      343,402                             293,435
                                                     -----------                          ----------
         Total assets..............................  $ 4,495,755                          $4,153,428
                                                     ===========                          ==========

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

Interest-bearing liabilities:
   Interest-bearing deposits:
     Interest-bearing demand deposits..............  $   371,174       1,114     1.22%    $  350,580       1,474    1.71%
     Savings deposits..............................    1,212,273      10,929     3.66        966,069       9,553    4.01
     Time deposits of $100 or more (3).............      213,461       2,918     5.54        210,119       3,148    6.08
     Other time deposits (3).......................    1,618,772      22,214     5.57      1,730,597      24,877    5.83
                                                       ---------      ------               ---------      ------       
         Total interest-bearing deposits...........    3,415,680      37,175     4.41      3,257,365      39,052    4.86
   Federal funds purchased, repurchase
     agreements and Federal Home Loan
     Bank advances (3).............................       83,256         998     4.86         48,873         579    4.80
   Notes payable and other.........................       50,001         793     6.43         54,623         970    7.20
                                                      ----------      ------               ---------      ------       
         Total interest-bearing liabilities........    3,548,937      38,966     4.45      3,360,861      40,601    4.90
Noninterest-bearing liabilities:
   Demand deposits.................................      508,451                             429,015
   Other liabilities...............................      171,607                             129,149
                                                     -----------                          ----------
         Total liabilities.........................    4,228,995                           3,919,025
Stockholders' equity...............................      266,760                             234,403
                                                     -----------                          ----------
         Total liabilities and
          stockholders' equity.....................  $ 4,495,755                          $4,153,428
                                                     ===========                          ==========
Net interest income................................                   43,825                              38,546
                                                                      ======                              ======
Net interest margin................................                              4.28%                              4.05%
                                                                                 ====                               ====
</TABLE>
--------------------------
(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  $202,000  and
     $217,000 for the three months ended March 31, 1999 and 1998, respectively.


<PAGE>


Provision for Possible Loan Losses

         The  provision  for possible  loan losses was $2.5 million  compared to
$2.1 million for the three  months ended March 31, 1999 and 1998,  respectively.
The increase in the provision for possible loan losses reflects continued growth
and   diversification  of  the  loan  portfolio  coupled  with  an  increase  in
nonperforming loans during the first quarter of 1999. In addition, for the three
months ended March 31, 1999,  First Banks  experienced  net loan  recoveries  of
$313,000,  in comparison to net loan  recoveries of $549,000 for the same period
in 1998. The acquisition of Redwood,  completed on March 4, 1999,  provided $1.5
million in additional  allowance for possible loan losses, while the acquisition
of Pacific  Bay Bank,  completed  on  February  2, 1998,  provided  $885,000  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 $9.6  million for the three  months ended March
31, 1999, in comparison to $7.8 million for the same period in 1998. Noninterest
income  consists  primarily  of service  charges on deposit  accounts,  gains on
mortgage  loans sold and held for sale,  and other  non-yield  related  customer
service fees.

         Service charges on deposit accounts and customer service fees were $3.9
million for the three months ended March 31, 1999,  compared to $3.4 million for
the same period in 1998.  The increase in service  charges and customer  service
fees is principally attributable to: (a). increased deposit balances provided by
internal growth;  (b). the  acquisitions of Pacific Bay Bank,  Republic Bank and
Redwood;  (c).  additional products and services available and utilized by First
Banks' retail and commercial  customer base;  (d).  increased fees charged;  and
(e). enhanced control of fee waivers.

         The gain on  mortgage  loans  sold and  held  for sale  increased  $1.3
million to $2.3  million from $1.0 for the three months ended March 31, 1999 and
1998,  respectively.  This  increase 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 non-conforming residential mortgage loans, which are sold on
a servicing  released  basis.  Additionally,  the  increase  also  reflects  the
continued expansion of First Banks' mortgage banking activities in the Texas and
California market areas.

         The gain on sales of securities  was $677,000 and $92,000 for the three
months ended March 31, 1999 and 1998, respectively. The gain resulted from sales
of  available-for-sale  securities,  the  proceeds of which were used to provide
funds for First  Banks'  continued  loan growth.  In addition,  the gain for the
three  months  ended  March 31, 1999  includes a $250,000  gain on the sale of a
mortgage-backed  residual  security  that was acquired by First Banks through an
acquisition  completed in 1995. Because of the unique structure of this residual
security,  at the date of  acquisition,  it appeared  unlikely  that First Banks
would  receive  full payment of all of the  remaining  principal  and  interest.
Consequently,  the aggregate  principal amount of this security was written off,
reflecting the approximate market value at that time.

         Net loss on sales of  trading  securities  was  $303,000  for the three
months  ended March 31,  1999,  in  comparison  to a net gain of $58,000 for the
three months ended March 31, 1998.  This loss resulted from the  termination  of
First Banks' trading division,  effective December 31, 1998, and the liquidation
of all trading portfolio securities.

         Other income was $2.8 million for the three months ended March 31, 1999
in comparison to $2.1 for the same period in 1998. The primary components of the
increase  are  attributable  to income  earned  on First  Banks'  investment  in
bank-owned life insurance  (BOLI),  expanded trust and private banking  services
and the settlement of certain litigation.  BOLI income was $824,000 and $638,000
for the three  months  ended March 31, 1999 and 1998,  respectively,  reflecting
increased income  attributable to FBA's initial  investment in BOLI completed in


<PAGE>


April 1998. Trust and private banking income increased $143,000 to $459,000 from
$316,000  for the three  months  ended  March 31,  1999 and 1998,  respectively,
resulting from continued growth experienced through enhanced product and service
offerings and First Banks'  expansion of these services into all markets served.
In addition,  other income for the three months ended March 31, 1999  reflects a
$250,000  settlement  received in  connection  with certain  litigation at First
Bank.

Noninterest Expense

         Noninterest  expense was $35.5  million and $32.1 million for the three
months ended March 31, 1999 and 1998, respectively.  The increase in noninterest
expense is attributable to the  acquisitions of Pacific Bay Bank,  Republic Bank
and Redwood and the  continued  expansion of First Banks'  commercial  functions
within existing markets. In addition,  the increase also reflects an increase of
$993,000 associated with the formation of First America Capital Trust (FACT) and
FACT's issuance of Cumulative Trust Preferred Securities in July 1998.

         Salaries and employee  benefits have increased to $14.5 million for the
three  months  ended  March 31,  1999 from $12.9  million for the same period in
1998. The increase is attributable to the newly acquired banks including Pacific
Bay Bank,  Republic Bank and Redwood,  and First Banks' continued  commitment to
expanding its  commercial  and retail  business  development  capabilities.  The
overall  increase  also  reflects  the  present  competitive  employment  market
environment  that has resulted in a higher  demand for more  limited  resources,
thus escalating industry salary and employee benefits costs.

         Data  processing  fees for the three  months  ended March 31, 1999 were
$4.5 million in  comparison  to $3.0 million for the same period in 1998.  First
Services,  L.P., a limited partnership indirectly owned by First Banks' Chairman
and his children  through its general  partners and limited  partners,  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,  and  expenses
associated with First Banks' Year 2000 program.

         Guaranteed  preferred  debentures  expense  increased  $993,000 to $3.0
million from $2.0 million at March 31, 1999 and 1998,  respectively.  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, on July 21, 1998, and 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 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.

         Other  noninterest  expense was $4.4  million and $4.6  million for the
three  months  ended March 31, 1999 and 1998,  respectively.  Other  noninterest
expense  for the  three  months  ended  March 31,  1998  includes  $1.1  million
representing  a  one-time  charitable  contribution  to the  Affordable  Housing
Assistance  Program.  In  addition,  during  the  first  quarter  of  1998,  the
Subsidiary  Banks  settled two lawsuits  that had been  outstanding  for several
years. In conjunction with these settlements, approximately $500,000 was charged
to other noninterest expense.

<PAGE>


Excluding these items,  other noninterest  expense increased  approximately $1.4
million during the first quarter of 1999. This increase was primarily driven by:
(a).  increased  amortization  of  intangibles  associated  with the purchase of
subsidiaries, reflective of the acquisitions completed throughout 1998 and early
1999; (b). increased recruiting expenses associated with obtaining and retaining
qualified  employees;  and  (c).  increased  expenses  associated  with the BOLI
investments.

                          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 90.4% and 84.6% of total  interest  income for the three months ended March
31,  1999  and  1998,  respectively.  Total  loans,  net of  unearned  discount,
represented  81.2% and 78.6% of total  assets as of March 31, 1999 and  December
31, 1998,  respectively.  Total loans,  excluding loans held for sale and net of
unearned  discount,  increased by $194.6  million to $3.64  billion at March 31,
1999 from $3.44  billion  at  December  31,  1998.  The  increase  reflects  the
acquisition  of Redwood,  which provided  loans,  net of unearned  discount,  of
$134.4  million,  and  the  continued  growth  and  diversification  within  the
corporate lending function of $78.0 million.  This increase was partially offset
by a $17.7 million decline in the existing residential real estate mortgage loan
portfolio  to $729.9  million at March 31, 1999 from $739.4  million at December
31,  1998.  This  decrease  is  reflective  of First  Banks'  continued  sale of
conforming  residential  mortgage loan  production  into the secondary  mortgage
market.

         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>


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

         Commercial, financial and agricultural:
<S>                                                                         <C>                        <C>   
              Nonaccrual...............................................     $    18,852                15,385
         Real estate construction and development:
              Nonaccrual...............................................           5,826                 3,858
         Real estate mortgage:
              Nonaccrual...............................................          20,393                18,858
              Restructured terms.......................................           4,573                 5,221
         Consumer and installment:
              Nonaccrual...............................................             160                   216
                                                                            -----------           -----------
              Total nonperforming loans................................          49,804                43,538
         Other real estate.............................................           3,376                 3,709
                                                                            -----------           -----------
              Total nonperforming assets...............................     $    53,180                47,247
                                                                            ===========           ===========

         Loans, net of unearned discount...............................     $ 3,764,408             3,580,105
                                                                            ===========           ===========
         Loans past due 90 days or more and still accruing.............     $     3,674                 4,674
                                                                            ===========           ===========

         Allowance for possible loan losses to loans ..................            1.73%                 1.70%
         Nonperforming loans to loans..................................            1.32                  1.22
         Allowance for possible loan losses to nonperforming loans.....          130.99                140.04
         Nonperforming assets to loans and other real estate...........            1.41                  1.32
                                                                            ===========           ===========
</TABLE>

         Nonperforming  loans,  consisting  of loans on  nonaccrual  status  and
restructured loans, were $49.8 million at March 31, 1999, in comparison to $43.5
million at December 31, 1998.  The majority of the increase is  attributable  to
First Bank, which experienced an increase in nonperforming loans of $4.5 million
to $26.5  million  from $22.0  million at March 31, 1999 and  December 31, 1998,
respectively.  Furthermore,  the  loans  obtained  through  the  acquisition  of
Redwood,  completed  on March 4,  1999,  have also  contributed  to the  overall
increase in nonperforming loans. The acquired allowance for possible loan losses
totaled $1.5 million at the acquisition date.

         Impaired loans,  consisting of nonaccrual loans and restructured loans,
were $49.8  million and $43.5  million at March 31, 1999 and  December 31, 1998,
respectively.
<PAGE>

         The following is a summary of loan loss experience for the three months
ended March 31:
<TABLE>
<CAPTION>

                                                                                        1999            1998
                                                                                        ----            ----
                                                                                  (dollars expressed in thousands)

<S>                                                                                   <C>               <C>   
     Allowance for possible loan losses, beginning of period....................      $  60,970         50,509
     Acquired allowances for possible loan losses...............................          1,466            885
                                                                                      ---------      ---------
                                                                                         62,436         51,394
     Loans charged-off..........................................................         (1,911)        (2,056)
     Recoveries of loans previously charged-off.................................          2,224          2,605
                                                                                      ---------      ---------
       Net loan recoveries......................................................            313            549
                                                                                      ---------      ---------
     Provision for possible loan losses.........................................          2,490          2,100
                                                                                      ---------      ---------
     Allowance for possible loan losses, end of period..........................      $  65,239         54,043
                                                                                      =========      =========
</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 and composition, 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.

                          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>

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

<S>                                                           <C>               <C>          <C>          <C>  
     Interest rate swap agreements.........................   $  280,000        232          280,000      3,526
     Interest rate floor agreements........................       70,000         --           70,000         --
     Interest rate cap agreements..........................       10,000        127           10,000        164
     Forward commitments to sell
       mortgage-backed securities..........................       60,000         --           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  couterparties
failed completely to perform according to the terms of the derivative  financial
instruments and the collateral was of no value.
<PAGE>

         Previously,  First Banks  utilized  interest  rate swap  agreements  to
extend the repricing characteristics of certain interest-bearing  liabilities to
correspond more closely 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 $1.3
million  and  $975,000  for the three  months  ended  March  31,  1999 and 1998,
respectively.  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 $4.4 million and $5.7
million at March 31, 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 (Swap Agreements). The Swap Agreements effectively
extended  the  repricing  term of a  selected  group of  loans  to more  closely
correspond 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. 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  $845,000  and  $4.2  million  at March  31,  1999 and  December  31,  1998,
respectively,  and the amount  payable by First Banks under the Swap  Agreements
was $613,000 and $640,000 at March 31, 1999 and December 31, 1998, respectively.
The maturity dates, notional amounts, interest rates paid and received, and fair
values of the Swap Agreements outstanding as of March 31, 1999 were as follows:
<TABLE>
<CAPTION>

                                                        Notional     Interest rate    Interest rate
                       Maturity date                     amount          paid           received       Fair value
                       -------------                     ------          ----           --------       ----------

<S>                                                   <C>                <C>             <C>            <C>    
         June 11, 2002..............................  $   15,000         5.00%           6.00%          $   157
         September 16, 2002.........................      20,000         5.00              5.36            (183)
         September 16, 2002.........................     175,000         5.00              5.36          (1,598)
         September 18, 2002.........................      30,000         5.00              5.33            (310)
         September 18, 2002.........................      40,000         5.00              5.33            (413)          
                                                      ----------                                        -------
                                                      $  280,000         5.00              5.39         $(2,347)
                                                      ==========         ====              ====         =======
</TABLE>

         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 March 31, 1999 and December 31, 1998, the unamortized costs of
these agreements were $127,000 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
$112.3  million and $103.1  million at March 31,  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 $60.0 million and $95.0
million at March 31, 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 March 31, 1999 and December 31, 1998, the net unamortized gains and
losses were  $826,000  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"  problem,  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
problem, 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  problem  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 has  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  problem,  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  throughout  1999 and early 2000. The testing of
the  Year  2000  solution  for ISC has  been  completed  and  will be  installed
throughout First Banks' branch network by June 30, 1999.

         The testing of CFI was  completed  by December  31,  1998.  The CFI was
installed in selected bank test locations during the fourth quarter of 1998. The
estimated cost of the teller  replacement is $8.0 million and will be charged to
expense over a 60-month period upon installation at each branch location.  First
Banks is also upgrading its local area network-based systems,  networks and core
processor,  and has purchased certain item processing equipment, as the previous
equipment,  which  is  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 is the  implementation of remediated and
other systems into the operating  environment of First Banks. The final phase of
the Program is scheduled to be completed by June 30, 1999.

         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

<PAGE>

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  its  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 for
the three months  ended March 31, 1999 and $600,000 for the year ended  December
31, 1998. In addition, First Banks is estimating direct expenses of $1.9 million
for the duration of the 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 includes the remediation and business resumption procedures for
common  systems,  coordinated by the Team, and  departmental  specific  systems,
coordinated  by the  appropriate  departmental  manager  and the  assigned  Team
member.  The Contingency Plan addresses a variety of issues  including  critical
systems,  credit  risk,  liquidity,  loan  and  deposit  customers,  facilities,
supplies and computer back-up locations. Additionally, First Banks has developed
business  resumption  plans for each  functional  area  deemed  critical  to the
operations  of First  Banks.  These  business  resumption  plans  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.

         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'
primary sources for liquidity are customer deposits,  loan payments,  maturities
and sales of investment securities and earnings.

         In addition,  First Banks and its Subsidiary Banks may avail themselves
of more volatile sources of funds through 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' $90 million credit agreement with a group of
unaffiliated  financial  institutions.  The aggregate  funds acquired from those
sources  were $357.8  million and $391.4  million at March 31, 1999 and December
31, 1998, respectively.
<PAGE>
<TABLE>
<CAPTION>

         At March 31, 1999,  First Banks' more volatile  sources of funds mature
as follows:

                                                                                  (dollars expressed in thousands)

<S>                                                                                         <C>       
         Three months or less...................................................            $  199,416
         Over three months through six months...................................                53,044
         Over six months through twelve months..................................                65,402
         Over twelve months.....................................................                39,980 
                                                                                            -----------
           Total................................................................            $  357,842 
                                                                                            ===========
</TABLE>

         Management believes the future earnings of its 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  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 131 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 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 and is effective for all fiscal
quarters of fiscal  years  beginning  after June 15, 1999.  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.  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. Additionally, SFAS 133 should not be
applied  retroactively to financial statements of prior periods.  First Banks is
currently  evaluating  SFAS  133  to  determine  its  potential  impact  on  the
consolidated financial statements of First Banks.

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

           11         Calculation of Earnings Per Share
           27         Article 9 - Financial Data Schedule (EDGAR only)

  (b)    First Banks filed no reports on Form 8-K during the three months ended
         March 31, 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:  May 12, 1999                  By: /s/ James F. Dierberg
                                         ---------------------
                                             James F. Dierberg
                                             Chairman, President and
                                                Chief Executive Officer



Date:  May 12, 1999                  By: /s/ Allen H. Blake     
                                         -----------------------
                                             Allen H. Blake
                                             Executive Vice President,
                                                Chief Financial Officer
                                                Chief Operating Officer
                                                and Secretary
                                                (Principal Financial Officer)


<PAGE>






                                   Exhibit 11


         The following is a reconciliation of the numerators and denominators of
the basic and diluted EPS computations for the periods indicated:


<TABLE>
<CAPTION>

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

Quarter ended March 31, 1999:
<S>                                                                  <C>               <C>        <C>       
     Basic EPS - income available to common stockholders.......      $  9,075          23,661     $   383.52
                                                                                                  ==========
     Effect of dilutive securities:
       Class A convertible preferred stock.....................           192           1,212
                                                                     --------        --------
     Diluted EPS - income available to common stockholders.....      $  9,267          24,873     $   372.57
                                                                     ========        ========     ==========

Quarter ended March 31, 1998:
     Basic EPS - income available to common stockholders.......      $  7,169          23,661     $   302.99
                                                                                                  ==========
     Effect of dilutive securities:
       Class A convertible preferred stock.....................           192           1,389
                                                                     --------        --------
     Diluted EPS - income available to common stockholders.....      $  7,361          25,050     $   293.85
                                                                     ========        ========     ==========

</TABLE>