<PAGE>

================================================================================

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

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

For the fiscal year ended December 31, 2004   Commission File Number: 000-30973

                               MBT FINANCIAL CORP.
             (Exact Name of Registrant as Specified in its Charter)

                 MICHIGAN                                38-3516922
         (State of Incorporation)           (I.R.S. Employer Identification No.)

             102 E. FRONT ST.
             MONROE, MICHIGAN                              48161
 (Address of Principal Executive Offices)               (Zip Code)

Registrant's Telephone Number, Including Area Code: (734) 241-3431

Securities registered pursuant to section 12(b) of the Act: None

Securities registered pursuant to section 12(g) of the Act: Common Stock, No Par
Value

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 by check mark if disclosure of delinquent filers pursuant to item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of the Form 10-K or any of the
amendments of this Form 10-K. [X]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2). YES [X] NO [ ]

As of June 30, 2004, the aggregate market value of the voting stock held by
non-affiliates of the Registrant was $317,694,160.

As of March 11, 2005, there were 17,487,184 shares of Common Stock outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Proxy Statement for Annual Meeting of Shareholders to be held
May 5, 2005 are incorporated by reference into Part III of this report on Form
10-K.

================================================================================

<PAGE>

                                     PART I

ITEM 1. BUSINESS

GENERAL

MBT Financial Corp. (the "Corporation") operates as a bank holding company
headquartered in Monroe, Michigan. The Corporation was incorporated under the
laws of the State of Michigan in January 2000, at the direction of the
management of Monroe Bank & Trust (the "Bank"), for the purpose of becoming a
bank holding company by acquiring all the outstanding shares of Monroe Bank &
Trust. At the April 6, 2000 Annual Meeting of Shareholders of Monroe Bank &
Trust, shareholders approved a proposal that resulted in the Bank merging with
Monroe Interim Bank, a state chartered bank, which was a subsidiary of the
Corporation. On July 1, 2000, the merger of Monroe Bank & Trust and Monroe
Interim Bank was completed, with Monroe Bank & Trust becoming the wholly owned
subsidiary of MBT Financial Corp.

Monroe Bank & Trust was incorporated and chartered as Monroe State Savings Bank
under the laws of the State of Michigan in 1905. In 1940, Monroe Bank & Trust
consolidated with Dansard Bank and moved to the present address of its main
office. Monroe Bank & Trust operated as a unit bank until 1950 when it opened
its first branch office in Ida, Michigan. It then continued its expansion to its
present total of 25 branch offices, including its main office. Monroe Bank &
Trust changed its name from "Monroe State Savings Bank" to "Monroe Bank & Trust"
in 1968.

Monroe Bank & Trust provides customary retail and commercial banking and trust
services to its customers, including checking and savings accounts, time
deposits, safe deposit facilities, commercial loans, personal loans, real estate
mortgage loans, installment loans, IRAs, ATM and night depository facilities,
treasury management services, telephone and internet banking, personal trust,
employee benefit and investment management services. Monroe Bank & Trust's
service areas are comprised of Monroe and Wayne counties in Southern Michigan.

Monroe Bank & Trust's deposits are insured by the Federal Deposit Insurance
Corporation ("FDIC") to applicable legal limits and Monroe Bank & Trust is
supervised and regulated by the FDIC and Michigan Office of Financial and
Insurance Services Division of Financial Institutions.

COMPETITION

MBT Financial Corp., through its subsidiary, Monroe Bank & Trust, operates in a
highly competitive industry. Monroe Bank & Trust's main competition comes from
other commercial banks, national or state savings and loan institutions,
securities brokers, mortgage bankers, finance companies and insurance companies.
Banks generally compete with other financial institutions through the banking
products and services offered, the pricing of services, the level of service
provided, the convenience and availability of services, and the degree of
expertise and personal manner in which these services are offered. Monroe Bank &
Trust encounters strong competition from most of the financial institutions in
Monroe Bank & Trust's extended market area.

The Bank's primary market area is Monroe County, Michigan. According to the most
recent market data, there are eight other deposit taking/lending institutions
competing in the Bank's market. According to the most recent market data for
deposits, the Bank ranks first in market share in Monroe County with 60.35% of
the market. In 2001 the Bank began expanding into Wayne County, Michigan, and
currently ranks eighteenth out of thirty-one institutions with a market share of
0.19%. For the combined Monroe and Wayne County market, the Bank ranks sixth of
thirty-three institutions with a market share of 3.51%.



                                       2
<PAGE>

SUPERVISION AND REGULATION

MBT Financial Corp., as a bank holding company, is regulated under the Bank
Holding Company Act of 1956, as amended (the BHC Act), and is subject to the
supervision and examination of the Board of Governors of the Federal Reserve
System (the Federal Reserve Board). The BHC Act requires the prior approval of
the Federal Reserve Board for a bank holding company to acquire or hold more
than a 5% voting interest in any bank. The BHC Act allows interstate bank
acquisitions anywhere in the country and interstate branching by acquisition and
consolidation in those states that have not opted out by January 1, 1997.

In addition, MBT Financial Corp. is generally prohibited by the BHC Act from
acquiring direct or indirect ownership or control of more than five percent of
the voting shares of any company which is not a bank or bank holding company and
from engaging directly or indirectly in activities other than those of managing
or controlling banks or furnishing services to its subsidiaries. MBT Financial
Corp. may, however, subject to the prior approval of the Federal Reserve Board,
engage in, or acquire shares of companies engaged in activities which are deemed
by the Federal Reserve Board by order or by regulation to be so closely related
to banking or managing and controlling a bank as to be a proper activity.

On November 12, 1999, the Gramm-Leach-Bliley Act (the "GLB Act") was enacted
into law. The GLB Act made sweeping changes with respect to the permissible
financial services which various types of financial institutions may now
provide. The Glass-Steagall Act, which had generally prevented banks from
affiliation with securities and insurance firms, was repealed. Pursuant to the
GLB Act, bank holding companies may elect to become a "financial holding
company," provided that all of the depository institution subsidiaries of the
bank holding company are "well capitalized" and "well managed" under applicable
regulatory standards.

Under the GLB Act, a bank holding company that has elected to become a financial
holding company may affiliate with securities firms and insurance companies and
engage in other activities that are financial in nature. Activities that are
"financial in nature" include securities underwriting, dealing and
market-making, sponsoring mutual funds and investment companies, insurance
underwriting and agency, merchant banking, and activities that the Federal
Reserve Board has determined to be closely related to banking. MBT Financial
Corp. has not elected to become a financial holding company.

MBT Financial Corp.'s banking subsidiary is subject to limitations with respect
to transactions with affiliates.

A substantial portion of the MBT Financial Corp.'s cash revenues is derived from
dividends paid by its subsidiary bank. These dividends are subject to various
legal and regulatory restrictions.

MBT Financial Corp.'s banking subsidiary, Monroe Bank & Trust (the "Bank") is
subject to primary supervision, regulation and examination by the Michigan
Office of Financial and Insurance Services and the Federal Deposit Insurance
Corporation (FDIC).

Federal regulators adopted risk-based capital guidelines and leverage standards
for banks and bank holding companies. A discussion of the impact of risk-based
capital guidelines and leverage standards is presented in Note 14 of the MBT
Financial Corp. financial statements included in Part II, Item 8 of this Form
10-K.

The Financial Reform, Recovery and Enforcement Act of 1989 (FIRREA) provides
that a holding company's controlled insured depository institutions are liable
for any loss incurred by the Federal



                                       3
<PAGE>

Deposit Insurance Corporation in connection with the default of any
FDIC-assisted transaction involving an affiliated insured bank or savings
association.

Noncompliance with laws and regulations by financial holding companies and banks
can lead to monetary penalties and/or an increased level of supervision or a
combination of these two items. Management is not aware of any current instances
of noncompliance with laws and regulations and does not anticipate any problems
maintaining compliance on a prospective basis. Recent regulatory inspections and
examinations of MBT Financial Corp. and the Bank have not disclosed any
significant instances of noncompliance. The minor instances of noncompliance
detected during these inspections and examinations were promptly corrected by
management and no action was taken by the regulators against MBT Financial Corp.
or the Bank.

The earnings and growth of MBT Financial Corp. are affected not only by general
economic conditions, but also by the fiscal and monetary policies of the federal
government and its agencies, particularly the Federal Reserve Board. Its
policies influence the amount of bank loans and deposits and the interest rates
charged and paid thereon, and thus have an effect on earnings. The nature of
future monetary policies and the effect of such policies on the future business
and earnings of MBT Financial Corp. and its subsidiary bank cannot be predicted.

EMPLOYEES

MBT Financial Corp. has no employees other than its three officers, each of whom
is also an employee and officer of Monroe Bank & Trust and who serve in their
capacity as officers of MBT Financial Corp. without compensation. As of December
31, 2004, Monroe Bank & Trust had 384 full-time employees and 12 part-time
employees. Monroe Bank & Trust provides a number of benefits for its full-time
employees, including health and life insurance, workers' compensation, social
security, paid vacations, numerous bank services, and a 401(k) plan.

EXECUTIVE OFFICERS OF THE REGISTRANT

<Table>
<Caption>
NAME                                        AGE               POSITION
----                                        ---               --------
<S>                                         <C>               <C>

H. Douglas Chaffin                          49                President & Chief Executive Officer
Donald M. Lieto                             49                Executive Vice President, Senior
                                                              Administration Manager, Monroe Bank & Trust
James E. Morr                               58                Executive Vice President, Senior Trust
                                                              Officer & General Counsel, Monroe Bank & Trust
Thomas G. Myers                             48                Executive Vice President & Chief
                                                              Lending Manager, Monroe Bank & Trust
John L. Skibski                             40                Executive Vice President & Chief
                                                              Financial Officer, Monroe Bank & Trust;
                                                              Treasurer, MBT Financial Corp.
Herbert J. Lock                             58                Senior Vice President & Investment
                                                              Officer, Monroe Bank & Trust;
                                                              Secretary, MBT Financial Corp.
</Table>

There is no family relationship between any of the Directors or Executive
Officers of the registrant and there is no arrangement or understandings between
any of the Directors or Executive Officers and any other person pursuant to
which he was selected a Director or Executive Officer nor with any respect to
the term which each will serve in the capacities stated previously.



                                       4
<PAGE>

The Executive Officers of the Bank are elected to serve for a term of one year
at the Board of Directors Annual Organizational Meeting, held in May.

H. Douglas Chaffin was President & Chief Executive Officer in 2004, President &
Chief Operating Officer in 2003, Executive Vice President, Senior Lending
Manager in 2002 and 2001, and Senior Vice President & City Executive, Lakeshore
Corporate Group, Huntington National Bank, in 2001 and 2000. Donald M. Lieto was
Executive Vice President, Senior Administration Manager in 2004 and 2003, and
Senior Vice President, Information Services Manager in 2003, 2002, 2001, and
2000. James E. Morr was Executive Vice President, Senior Trust Officer and
General Counsel for each of the last five years. Thomas G. Myers was Executive
Vice President & Chief Lending Manager in 2004 and 2003, Senior Vice President,
Commercial Group Manager in 2003 and 2002, and Corporate Banking Group Manager,
Huntington National Bank, in 2001 and 2000. John L. Skibski was Executive Vice
President & Chief Financial Officer in 2004, Senior Vice President & Controller
in 2003, and Vice President & Controller in 2002, 2001 and 2000. Herbert J. Lock
was Senior Vice President and Investment Officer for each of the last five
years.

AVAILABLE INFORMATION

MBT Financial Corp. makes its annual report on Form 10-K, its quarterly reports
on Form 10-Q, its current reports on Form 8-K, and all amendments to those
reports available on its website as soon as reasonably practicable after they
are filed with or furnished to the SEC, free of charge. The website address is
www.mbandt.com.

ITEM 2. PROPERTIES

MBT Financial Corp. does not conduct any business other than its ownership of
Monroe Bank & Trust's stock. MBT Financial Corp. operates its business from
Monroe Bank & Trust's main office facility. Monroe Bank & Trust operates its
business from its main office complex and 24 full service branches in the
counties of Monroe and Wayne, Michigan. In addition, MBT Credit Company, Inc., a
wholly owned subsidiary of Monroe Bank & Trust, operates a mortgage loan
origination office in Monroe, Michigan. The Bank owns its main office complex
and 21 of its branches. The remaining three branches and the MBT Credit Company,
Inc. locations are leased.

ITEM 3. LEGAL PROCEEDINGS

MBT Financial Corp. and its subsidiaries are not a party to, nor is any of their
property the subject of any material pending legal proceedings other than
ordinary routine litigation incidental to their respective businesses, nor are
any such proceedings known to be contemplated by governmental authorities.

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

No matter was submitted to the vote of holders of MBT Financial Corp. securities
during the fourth quarter of 2004.



                                       5
<PAGE>

                                     Part II

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED SECURITY HOLDER
MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES

Common stock consists of 17,465,839 shares with a book value of $8.89. Dividends
declared on common stock during 2004 amounted to $.62 per share. The common
stock is traded on the NASDAQ National Market under the symbol MBTF. Below is a
schedule of the high and low trading price for the past two years by quarter.
These prices represent those known to Management, but do not necessarily
represent all transactions that occurred.

<Table>
<Caption>
                                         2004                      2003
                                   HIGH         LOW          HIGH         LOW
                                 --------     --------     --------     --------
<S>                              <C>          <C>          <C>          <C>
1st quarter                      $  17.90     $  16.59     $  13.50     $  13.00
2nd quarter                      $  19.01     $  16.85     $  18.80     $  13.20
3rd quarter                      $  20.60     $  17.24     $  17.40     $  14.50
4th quarter                      $  26.00     $  19.25     $  18.10     $  15.20
</Table>

Dividends declared during the past three years on a quarterly basis were as
follows:

                                           2004           2003           2002
                                        ----------     ----------     ----------
1st quarter                             $     0.15     $     0.14     $     0.13
2nd quarter                             $     0.15     $     0.14     $     0.13
3rd quarter                             $     0.16     $     0.15     $     0.14
4th quarter                             $     0.16     $     0.15     $     0.14

As of December 31, 2004, the number of holders of record of the Corporation's
common shares was 1,306. Management's present expectation is that dividends will
continue to be paid in the future.

The following table summarizes the repurchase activity of the Corporation's
common stock during the three months ended December 31, 2004:

<Table>
<Caption>
                                                                                    Total Number of Shares   Maximum Number of
                                                                      Average        Purchased as Part of   Shares that May Yet
                                             Total Number of         Price Paid       Publicly Announced     Be Purchased Under
                                             Shares Purchased        per Share        Plans or Programs     the Plans or Programs
                                             ----------------     ----------------  ----------------------  ---------------------
<S>                                          <C>                  <C>               <C>                     <C>
October 1, 2004 - October 31, 2004                     70,000     $          18.70               70,000               880,441
November 1, 2004 - November 30, 2004                       --     $             --                   --               880,441
December 1, 2004 - December 31, 2004                       --     $             --                   --               880,441
                                             ----------------     ----------------     ----------------      ----------------
Total                                                  70,000     $          18.70               70,000
                                             ----------------     ----------------     ----------------      ----------------
</Table>

ITEM 6. SELECTED FINANCIAL DATA

The selected financial data for the five years ended December 31, 2004 are
derived from the audited Consolidated Financial Statements of the Corporation.
The financial data set forth below contains only a portion of our financial
statements and should be read in conjunction with the Consolidated Financial
Statements and related notes and "Management's Discussion and Analysis of
Financial Condition and Results of Operations" included in this Form 10-K.



                                       6
<PAGE>

SELECTED CONSOLIDATED FINANCIAL DATA

<Table>
<Caption>
Dollar amounts are in thousands,
     except per share data                     2004            2003            2002            2001            2000
                                           ------------    ------------    ------------    ------------    ------------
<S>                                        <C>             <C>             <C>             <C>             <C>
CONSOLIDATED STATEMENTS OF INCOME
Interest Income                            $     79,703    $     77,774    $     84,604    $    101,324    $     99,570
Interest Expense                                 26,998          27,467          34,387          49,535          49,681
                                           ------------    ------------    ------------    ------------    ------------
Net Interest Income                              52,705          50,307          50,217          51,789          49,889
Provision for Loan Losses                         2,491           8,005           6,101           7,400           6,298
                                           ------------    ------------    ------------    ------------    ------------
Net Interest Income after
    Provision for Loan Losses                    50,214          42,302          44,116          44,389          43,591
Other Income                                     13,776          13,803          12,791          10,651           8,709
Other Expenses                                   32,616          30,179          26,989          23,810          23,094
                                           ------------    ------------    ------------    ------------    ------------
Income before Provision
    for Income Taxes                             31,374          25,926          29,918          31,230          29,206
Provision for
    Income Taxes                                  8,775           6,611           8,114           8,307           8,031
                                           ------------    ------------    ------------    ------------    ------------
Net Income                                 $     22,599    $     19,315    $     21,804    $     22,923    $     21,175
                                           ============    ============    ============    ============    ============
Net Income available to
    Common Shareholders                    $     22,599    $     19,315    $     21,804    $     21,923    $     21,168
                                           ============    ============    ============    ============    ============

PER COMMON SHARE*
Basic Net Income                           $       1.30    $       1.02    $       1.12    $       1.10    $       1.06
Diluted Net Income                                 1.29            1.01            1.12            1.10            1.06
Cash Dividends Declared                            0.62            0.58            0.54            0.50            0.37
Book Value at Year End                             8.89            8.20            8.72            8.19            7.55
Average Common Shares
    Outstanding                              17,444,165      19,026,369      19,458,737      19,933,580      20,000,000
                                           ============    ============    ============    ============    ============

CONSOLIDATED BALANCE SHEETS (YEAR END)
Total Assets                               $  1,552,279    $  1,457,788    $  1,409,694    $  1,394,168    $  1,379,386
Total Securities                                505,441         508,482         539,737         497,501         452,405
Loans, Net of Deferred Loan Fees                945,881         863,850         773,805         787,825         812,123
Allowance for Loan Losses                        13,800          14,500          12,400          13,000          10,600
Deposits                                      1,100,711       1,039,117       1,010,960         998,880         994,596
Borrowings                                      286,500         270,000         225,000         225,000         225,000
Total Shareholders' Equity                      155,346         143,446         166,999         161,730         150,955
                                           ============    ============    ============    ============    ============

SELECTED FINANCIAL RATIOS
Return on Average Assets                           1.52%           1.33%           1.55%           1.56%           1.66%
Return on Average Equity                          15.18%          11.39%          13.29%          13.70%          14.42%
Net Interest Margin                                3.75%           3.67%           3.79%           3.88%           4.13%
Dividend Payout Ratio                             47.69%          56.14%          47.99%          45.40%          34.95%
Allowance for Loan Losses
    to Period End Loans                            1.69%           1.68%           1.60%           1.65%           1.31%
Allowance for Loan Losses
    to Non Performing Loans                       34.57%          30.41%          27.93%          46.90%          51.53%
Non Performing Loans
    to Period End Loans                            4.22%           5.50%           5.74%           3.52%           2.53%
Net Charge Offs to Average Loans                   0.35%           0.72%           0.87%           0.59%           0.73%
                                           ============    ============    ============    ============    ============
</Table>

* The reorganization into a one-bank holding company in 2000 resulted in an
exchange of Monroe Bank & Trust stock for MBT Financial Corp. stock. The
exchange rate was two shares of MBT Financial Corp. for each share of Monroe
Bank & Trust, causing an increase of 10,000,000 shares outstanding. All
per-share amounts have been restated to reflect this transaction.



                                       7
<PAGE>

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Certain statements contained herein are not based on historical facts and are
"forward-looking statements" within the meaning of Section 21A of the Securities
Exchange Act of 1934. Forward-looking statements which are based on various
assumptions (some of which are beyond the Corporation's control), may be
identified by reference to a future period or periods, or by the use of
forward-looking terminology, such as "may," "will," "believe," "expect,"
"estimate," "anticipate," "continue," or similar terms or variations on those
terms, or the negative of these terms. Actual results could differ materially
from those set forth in forward-looking statements, due to a variety of factors,
including, but not limited to, those related to the economic environment,
particularly in the market areas in which the company operates, competitive
products and pricing, fiscal and monetary policies of the U.S. Government,
changes in government regulations affecting financial institutions, including
regulatory fees and capital requirements, changes in prevailing interest rates,
acquisitions and the integration of acquired businesses, credit risk management,
asset/liability management, the financial and securities markets and the
availability of and costs associated with sources of liquidity.

CRITICAL ACCOUNTING POLICIES - The Bank's Allowance for Loan Losses is a
"critical accounting estimate" because it is an estimate that is based on
assumptions that are highly uncertain, and if different assumptions were used or
if any of the assumptions used were to change, there could be a material impact
on the presentation of the Corporation's financial condition. These assumptions
include, but are not limited to, collateral values and the effect of economic
conditions on the financial condition of the borrowers. To determine the
Allowance for Loan Losses, the Bank estimates losses on all loans that are not
classified as substandard or doubtful by applying historical loss rates to those
loans in accordance with SFAS 5. In addition, all loans that are classified as
substandard or doubtful and any loans that are nonaccrual or renegotiated are
individually tested for impairment. Any amount of monetary impairment is
included in the Allowance for Loan Losses in accordance with SFAS 114.
Substandard, doubtful, nonaccrual, or renegotiated loans that do not have any
monetary impairment identified are assigned an allowance following the same
method as unclassified loans. Management is of the opinion that the Allowance
for Loan Losses of $13,800,000 as of December 31, 2004 was adequate.

Assets acquired through, or in lieu of, loan foreclosure are held for sale and
are initially recorded at the lower of fair value or the loan carrying amount at
the date of foreclosure. Subsequent to foreclosure, valuations are periodically
performed by Management and the assets are carried at the lower of carrying
amount or fair value less cost to sell.

RESULTS OF OPERATIONS - Net Income increased 17.0% in 2004 to $22.6 million as
the economy continued to gain strength and the Fed began to raise managed
interest rates. Net Interest Income increased $2.4 million as the average
earning assets increased $37.6 million and the net interest margin increased
from 3.67% to 3.75%. During 2004, Net Loans increased $83.4 million, or 9.8%,
and Deposits increased $61.6 million, or 5.9%. The Bank also increased its
longer term Federal Home Loan Bank borrowings and Repurchase Agreements while
reducing its overnight federal funds borrowed. The most significant improvement
in the earnings was due to the decrease of $5.5 million, or 68.9% in the
Provision for Loan Losses. This decrease was due to the exceptionally large
provision recorded in 2003. Non Interest Income decreased slightly in 2004 as
securities gains and mortgage origination fees both declined as rates began to
rise. Excluding these two items, non interest income increased $937,000, or 8%
compared to 2003. Non Interest Expenses increased $2.4 million, or 8.1%,
primarily due to increases in compensation and occupancy expenses related to the
Bank's expansion efforts into the Downriver area of southern Wayne County. As a
result of the above, Income Before the Provision for Income taxes increased $5.4



                                       8
<PAGE>

million, or 21.0%. The percentage of the Bank's income that is generated by tax
exempt securities and Bank Owned Life Insurance decreased in 2004, causing the
effective tax rate to increase from 25.5% in 2003 to 28.0%. The increase in
Income Before taxes and the increase in the effective tax rate resulted in an
increase of $2.2 million or 32.7% in the Provision for Income Taxes. Net Income
increased $3.3 million, or 17% to $22.6 million.

In 2003, the deterioration of some large credit relationships led to a $5.5
million addition to the Allowance for Loan Losses. This caused Net Income to
decrease $2.5 million, or 11%, compared to 2002. Although average earning assets
increased $44.2 million, the net interest margin decreased ten basis points. As
a result, the net interest income increased only $90,000. Equity markets began
to recover late in 2003, but the low market values for most of the year caused
our income from trust services to decline $181,000, or 5%. We were able to
increase our deposit account service charges in 2003. While remaining one of the
lowest cost providers of deposit services in our market, our fee income
increased by $787,000, or 17%. In 2003, we increased our investment in Bank
Owned Life Insurance resulting in an increase of $508,000, or 64% in the
earnings on these policies. Total non-interest income increased $1,012,000, or
8%. Non-interest expenses increased as we continued our expansion into the
southern Wayne County market. During 2003 we opened two full service branches
and we increased our total staffing from 375 to 389. These changes contributed
to the increase of $3.2 million, or 12% in our non-interest expenses. Income
before Provision for Income Taxes decreased $4.0 million, or 13% compared to
2002. The lower amount of income resulted in a decrease of $1.5 million, or 19%
in our Provision for Income Taxes. The effective tax rate decreased from 27.1%
in 2002 to 25.5% in 2003.

Net Income decreased slightly in 2002 as we encountered continued low interest
rates and a sluggish national and local economy. Net Income decreased $121,000,
or less than 1%, compared to 2001. While Deposits and Total Assets each
increased 1%, Net Loans decreased 2%. Commercial and industrial loans decreased
8% and loans to individuals for household, family, and other personal
expenditures decreased 22% while real estate loans showed a slight increase of
3%. The decrease in loans was partially attributable to the transfer of $12.9
million of loans to other real estate and charge offs of $8.7 million, which
enabled us to reduce our allowance for loan losses $600,000. Income before
Provision for Income Taxes decreased $1.3 million, or 4%, compared to 2001. A
larger percentage of our income was in interest on Obligations of States and
Political Subdivisions in 2002, resulting in a decrease of $193,000, or 2% in
our Provision for Income Taxes. The effective tax rate decreased from 27.5% in
2001 to 27.1% in 2002.

Earnings for the Bank are usually highly reflective of the Net Interest Income.
In 2004 the Federal Open Market Committee of the Federal Reserve raised the fed
funds rate for the first time since 2000 as the economy continued to grow.
During the year, the fed funds target rate was increased five times, from 1.00%
to 2.25%. In spite of these increases, rates on new and renewing loans were
still below the average rates in the loan portfolio. As a result, the average
yield on loans decreased from 6.73% to 6.30%. Investment yields did improve
slightly and the cost of funds decreased, resulting in an increase in the net
interest margin and net interest income. In 2003, rates remained low, with the
Fed lowering the managed rates 25 basis points in June. This caused refinance
activity to continue, and the Bank's yield on loans declined from 7.70% to
6.73%. Market rates also were low, and the investment yield dropped from 4.74%
to 4.18% in 2003. During the year, the Bank restructured its portfolio of
Federal Home Loan Bank advances, converting $95 million, or 42% of its
portfolio, from fixed rate to floating rate. This lowered the cost of these
borrowings from 5.72% in 2001 and 2002 to 5.05% in 2003. In 2002, market
interest rates remained at historically low levels, prompting many borrowers to
refinance their existing debt. The low interest rate environment also resulted
in an increase in the amount of investment securities called. These factors lead
to a decrease in the yield on earning assets from 7.4% in 2001 to 6.2% in 2002.
Total Interest Income decreased $16.7 million while Total Interest Expense
decreased only $15.1



                                       9
<PAGE>

million, resulting in a decrease of $1.6 million in Net Interest Income. The
Provision for Loan Losses decreased $1.3 million after a large increase in 2001.
Other Income increased $2.1 million as service charges on deposit accounts
increased due to an overdraft program started late in 2001 and gains on the
sales of investment securities also increased. Non-interest expenses increased
9% compared to 2001. Salaries and Employee Benefits increased 9% as the Bank
continued to add staff, particularly in the loan, credit analysis, and loan
review areas. This additional staff will allow the Bank to provide better
customer service to existing customers, resume the growth in the loan portfolio,
and improve the monitoring of existing credit relationships. The average cost of
interest bearing deposits was 1.65%, 1.74%, and 2.41% for 2004, 2003, and 2002
respectively. The table below shows selected financial ratios for the same three
years.

<Table>
<Caption>
                                                       2004          2003          2002
                                                    ----------    ----------    ----------
<S>                                                <C>            <C>           <C>
         Return on Average Assets                         1.52%         1.33%         1.55%
         Return on Average Equity                        15.18%        11.39%        13.29%
         Dividend Payout Ratio                           47.69%        56.14%        48.21%
         Average Equity to Average Assets                10.02%        11.71%        11.67%
</Table>

The following table shows the investment portfolio for the last three years
(000s omitted).

<Table>
<Caption>
                                                                               Held to Maturity
                                                  ---------------------------------------------------------------------------
                                                     December 31, 2004         December 31, 2003         December 31, 2002
                                                  -----------------------   -----------------------   -----------------------
                                                                Estimated                 Estimated                 Estimated
                                                  Amortized      Market     Amortized      Market     Amortized      Market
                                                     Cost        Value         Cost        Value         Cost        Value
                                                  ----------   ----------   ----------   ----------   ----------   ----------
<S>                                               <C>          <C>          <C>          <C>          <C>          <C>
U.S. Government agency and corporation
 obligations ..................................   $      527   $      578   $      536   $      590   $      588   $      649
Securities issued by states and political
 subdivisions in the U.S. .....................       80,622       82,636       95,634       99,234      113,255      117,968
Other domestic securities (debt and equity) ...        2,992        3,074        2,984        3,116        2,976        2,975
                                                  ----------   ----------   ----------   ----------   ----------   ----------
Total .........................................   $   84,141   $   86,288   $   99,154   $  102,940   $  116,819   $  121,592
                                                  ==========   ==========   ==========   ==========   ==========   ==========
Pledged securities ............................   $   19,659   $   20,373   $   23,903   $   25,175   $   31,972   $   33,672
                                                  ==========   ==========   ==========   ==========   ==========   ==========
</Table>

<Table>
<Caption>
                                                                         Available for Sale
                                                  ---------------------------------------------------------------------------
                                                     December 31, 2004         December 31, 2003         December 31, 2002
                                                  -----------------------   -----------------------   -----------------------
                                                                Estimated                 Estimated                 Estimated
                                                  Amortized      Market     Amortized      Market     Amortized      Market
                                                     Cost        Value         Cost        Value         Cost        Value
                                                  ----------   ----------   ----------   ----------   ----------   ----------
<S>                                               <C>          <C>          <C>          <C>          <C>          <C>
U.S. Government agency and corporation
 obligations (excluding mortgage-backed
 securities) ..................................   $  315,410   $  314,381   $  315,004   $  311,944   $  322,878   $  325,131
Securities issued by states and political
 subdivisions in the U.S. .....................       28,635       29,187       26,047       26,473       14,680       14,723
Other domestic securities (debt and
 equity) ......................................       64,472       64,785       57,876       59,225       84,554       83,064
                                                  ----------   ----------   ----------   ----------   ----------   ----------
Total .........................................   $  408,517   $  408,353   $  398,927   $  397,642   $  422,112   $  422,918
                                                  ==========   ==========   ==========   ==========   ==========   ==========
Pledged securities ............................   $  304,004   $  303,300   $  285,427   $  283,103   $  249,436   $  251,994
                                                  ==========   ==========   ==========   ==========   ==========   ==========
</Table>



                                       10
<PAGE>

The following table shows average daily balances, interest income or expense
amounts, and the resulting average rates for interest earning assets and
interest bearing liabilities for the last three years. Also shown are the net
interest income, total interest rate spread, and the net interest margin for the
same periods.

<Table>
<Caption>
                                                                       Years Ended December 31,
                                    ------------------------------------------------------------------------------------------
                                                       2004                                           2003
                                    --------------------------------------------    ------------------------------------------
                                      Average         Interest                        Average        Interest
                                       Daily           Earned         Average          Daily          Earned        Average
   (Dollars in Thousands)             Balance         or Paid          Yield          Balance        or Paid         Yield
   ----------------------           ------------    ------------    ------------    ------------   ------------   ------------
<S>                                 <C>             <C>             <C>             <C>            <C>            <C>
Investments
  Obligations of US
    Government Agencies             $    303,121    $     13,090            4.32%   $    326,442   $     12,429           3.81%
  Obligations of States &
    Political Subdivisions(1)            115,590           5,614            4.86%        123,489          6,206           5.03%
  Other Securities                        69,538           3,330            4.79%         84,725          3,737           4.41%
                                    ------------    ------------    ------------    ------------   ------------   ------------
Total Investments                        488,249          22,034            4.51%        534,656         22,372           4.18%
                                    ------------    ------------    ------------    ------------   ------------   ------------

Loans
  Commercial                             600,551          36,364            6.06%        549,558         34,671           6.31%
  Mortgage                               194,072          12,217            6.30%        166,665         11,829           7.10%
  Consumer                               120,327           9,079            7.55%        104,971          8,754           8.34%
                                    ------------    ------------    ------------    ------------   ------------   ------------
Total Loans(2)                           914,950          57,660            6.30%        821,194         55,254           6.73%

Federal Funds Sold                           538               9            1.67%         13,894            148           1.07%
                                    ------------    ------------    ------------    ------------   ------------   ------------
Total Interest Earning Assets          1,403,737          79,703            5.68%      1,369,744         77,774           5.68%

Cash & Due From Banks                     25,230                                          25,277
Interest Receivable and Other
  Assets                                  64,256                                          60,631
                                    ------------                                    ------------
Total Assets                        $  1,493,223                                    $  1,455,652
                                    ============                                    ============

Savings Accounts                    $    129,075    $        325            0.25%   $    132,780   $        560           0.42%
NOW Accounts                              69,072             172            0.25%         67,290            281           0.42%
Money Market Deposits                    329,480          11,815            3.59%        372,177          4,219           1.13%
Certificates of Deposit                  378,959           2,611            0.69%        348,847         10,932           3.13%
Federal Funds Purchased                   32,894             491            1.49%          9,136            120           1.31%
Repurchase Agreements                     13,525             422            3.12%              0
FHLB Advances                            242,104          11,162            4.61%        225,000         11,355           5.05%
                                    ------------    ------------    ------------    ------------   ------------   ------------
Total Interest Bearing
  Liabilities                          1,195,109          26,998            2.26%      1,155,230         27,467           2.38%

Non-interest Bearing Deposits            143,759                                         126,874
Other Liabilities                          5,438                                           3,971
                                    ------------                                    ------------
Total Liabilities                      1,344,306                                       1,286,075

Stockholders' Equity                     148,917                                         169,577
                                    ------------                                    ------------
Total Liabilities &
  Stockholders' Equity              $  1,493,223                                    $  1,455,652
                                    ============                                    ============

Net Interest Income                                 $     52,705                                   $     50,307
Interest Rate Spread                                                        3.42%                                         3.30%
Net Interest Income as a
  percent of average
  earning assets                                                            3.75%                                         3.67%

<Caption>
                                           Years Ended December 31,
                                    ------------------------------------------
                                                      2002
                                    ------------------------------------------
                                      Average        Interest
                                       Daily          Earned        Average
   (Dollars in Thousands)             Balance        or Paid         Yield
   ----------------------           ------------   ------------   ------------
<S>                                 <C>            <C>            <C>
Investments
  Obligations of US
    Government Agencies             $    288,438   $     13,106           4.54%
  Obligations of States &
    Political Subdivisions(1)            130,046          6,741           5.18%
  Other Securities                       105,876          5,028           4.75%
                                    ------------   ------------   ------------
Total Investments                        524,360         24,875           4.74%
                                    ------------   ------------   ------------

Loans
  Commercial                             489,498         35,081           7.17%
  Mortgage                               160,764         13,333           8.29%
  Consumer                               118,026         10,766           9.12%
                                    ------------   ------------   ------------
Total Loans(2)                           768,288         59,180           7.70%

Federal Funds Sold                        32,950            549           1.67%
                                    ------------   ------------   ------------
Total Interest Earning Assets          1,325,598         84,604           6.38%

Cash & Due From Banks                     30,306
Interest Receivable and Other
  Assets                                  49,585
                                    ------------
Total Assets                        $  1,405,489
                                    ============

Savings Accounts                    $    127,826   $      1,521           1.19%
NOW Accounts                              66,648            752           1.13%
Money Market Deposits                    336,370          5,661           1.68%
Certificates of Deposit                  358,846         13,535           3.77%
Federal Funds Purchased                    2,052             38           1.85%
Repurchase Agreements                          0
FHLB Advances                            225,000         12,880           5.72%
                                    ------------   ------------   ------------
Total Interest Bearing
  Liabilities                          1,116,742         34,387           3.08%

Non-interest Bearing Deposits            119,613
Other Liabilities                          5,044
                                    ------------
Total Liabilities                      1,241,399

Stockholders' Equity                     164,090
                                    ------------
Total Liabilities &
  Stockholders' Equity              $  1,405,489
                                    ============

Net Interest Income                                $     50,217
Interest Rate Spread                                                      3.30%
Net Interest Income as a
  percent of average
  earning assets                                                          3.79%
</Table>

(1)  Interest income on Obligations of States and Political Subdivisions is not
     on a taxable equivalent basis.

(2)  Total Loans excludes Overdraft Loans, which are non-interest earning. These
     loans are included in Other Assets. Total Loans includes nonaccrual loans.
     When a loan is placed in nonaccrual status, all accrued and unpaid interest
     is charged against interest income. Loans on nonaccrual status do not earn
     any interest.



                                       11
<PAGE>

The following table summarizes the changes in interest income and interest
expense attributable to changes in interest rates and changes in the volume of
interest earning assets and interest bearing liabilities for the period
indicated:

<Table>
<Caption>
                                                           Years Ended December 31,
                                 --------------------------------------------------------------------------------
                                             2004 versus 2003                        2003 versus 2002
                                 --------------------------------------    --------------------------------------
                                              Changes due to                          Changes due to
                                          increased (decreased)                    increased (decreased)
                                 --------------------------------------    --------------------------------------
  (Dollars in Thousands)            Rate         Volume         Net           Rate         Volume         Net
  ----------------------         ----------    ----------    ----------    ----------    ----------    ----------
     Interest Income
------------------------
<S>                              <C>           <C>           <C>           <C>           <C>           <C>
Investments
   Obligations of US
     Government Agencies         $    1,549    $     (888)   $      661    $   (2,403)   $    1,727    $     (676)
   Obligations of States &
     Political Subdivisions            (195)         (397)         (592)         (195)         (340)         (535)
   Other Securities                     262          (670)         (408)         (287)       (1,004)       (1,291)
                                 ----------    ----------    ----------    ----------    ----------    ----------
Total Investments                     1,616        (1,955)         (339)       (2,885)          383        (2,502)
                                 ----------    ----------    ----------    ----------    ----------    ----------

Loans
   Commercial                        (1,525)        3,217         1,692        (4,715)        4,304          (411)
   Mortgage                          (1,556)        1,945           389        (1,993)          489        (1,504)
   Consumer                            (955)        1,280           325          (822)       (1,191)       (2,013)
                                 ----------    ----------    ----------    ----------    ----------    ----------
Total Loans                          (4,036)        6,442         2,406        (7,530)        3,602        (3,928)

Federal Funds Sold                        3          (142)         (139)          (84)         (318)         (402)
                                 ----------    ----------    ----------    ----------    ----------    ----------
Total Interest Income                (2,417)        4,345         1,928       (10,499)        3,667        (6,832)

   Interest Expense
------------------------
Savings Accounts                       (219)          (16)         (235)       (1,021)           59          (962)
NOW Accounts                           (116)            7          (109)         (479)            7          (472)
Money Market Deposits                (1,124)          944          (180)       (2,045)          603        (1,442)
Certificates of Deposit                 (61)         (484)         (545)       (2,226)         (377)       (2,603)
Federal Funds Purchased                  57           313           370           (48)          130            82
Repurchase agreements                   422             0           422             0             0             0
FHLB Advances                        (1,056)          863          (193)       (1,525)            0        (1,525)
                                 ----------    ----------    ----------    ----------    ----------    ----------
Total Interest Expense               (2,097)        1,627          (470)       (7,344)          422        (6,922)
                                 ----------    ----------    ----------    ----------    ----------    ----------

Net Interest Income              $     (320)   $    2,718    $    2,398    $   (3,155)   $    3,245    $       90
                                 ==========    ==========    ==========    ==========    ==========    ==========

<Caption>
                                       Years Ended December 31,
                                 --------------------------------------
                                          2002 versus 2001
                                 --------------------------------------
                                           Changes due to
                                         increased (decreased)
                                 --------------------------------------
  (Dollars in Thousands)            Rate         Volume         Net
  ----------------------         ----------    ----------    ----------
     Interest Income
------------------------
<S>                              <C>           <C>           <C>
Investments
   Obligations of US
     Government Agencies         $   (5,440)   $    5,464    $       24
   Obligations of States &
     Political Subdivisions            (220)          140           (80)
   Other Securities                  (1,172)       (2,505)       (3,677)
                                 ----------    ----------    ----------
Total Investments                    (6,832)        3,099        (3,733)
                                 ----------    ----------    ----------

Loans
   Commercial                        (5,631)       (2,595)       (8,226)
   Mortgage                            (380)       (2,643)       (3,023)
   Consumer                            (847)         (993)       (1,840)
                                 ----------    ----------    ----------
Total Loans                          (6,858)       (6,231)      (13,089)

Federal Funds Sold                     (587)          689           102
                                 ----------    ----------    ----------
Total Interest Income               (14,277)       (2,443)      (16,720)

   Interest Expense
------------------------
Savings Accounts                     (1,149)          217          (932)
NOW Accounts                           (673)          145          (528)
Money Market Deposits                (5,244)        2,553        (2,691)
Certificates of Deposit              (5,523)       (5,485)      (11,008)
Federal Funds Purchased                 (62)           73            11
Repurchase agreements                     0             0             0
FHLB Advances                             0             0             0
                                 ----------    ----------    ----------
Total Interest Expense              (12,651)       (2,497)      (15,148)
                                 ----------    ----------    ----------

Net Interest Income              $   (1,626)   $       54    $   (1,572)
                                 ==========    ==========    ==========
</Table>

Due to a variety of reasons, including volatile interest rates in the past and
successful bidding in securing local municipal deposits, we have attempted, for
the last several years, to maintain a liquid investment position. The percentage
of securities held as Available for Sale increased from 80% as of December 31,
2003 to 83% as of December 31, 2004. As reflected in Note 3 to the consolidated
financial statements, the percentage of securities that mature within five years
was 12% as of December 31, 2004 and 13% as of December 31, 2003. The table below
presents the scheduled maturities for each of the investment categories, and the
average yield on the amounts maturing. The yields presented for the Obligations
of States and Political Subdivisions are not tax equivalent yields. The interest
income on these securities is exempt from federal income tax. The Corporation's
statutory federal income tax rate is thirty-five percent.

<Table>
<Caption>
                                                                        Maturing
                                      -----------------------------------------------------------------------------
                                           Within 1 year               1 - 5 years               5 - 10 Years
                                      -----------------------    -----------------------    -----------------------
                                        Amount       Yield         Amount       Yield         Amount       Yield
                                      ----------   ----------    ----------   ----------    ----------   ----------
  (Dollars in Thousands)
  ----------------------
<S>                                   <C>          <C>           <C>           <C>          <C>          <C>
Obligations of US
   Government Agencies                $       --         0.00%   $   15,960         3.58%   $  207,895         4.47%
Obligations of States & Political
   Subdivisions                            5,536         5.21%       31,472         5.21%       50,606         4.83%
Other Securities                           2,992         4.91%           --         0.00%        5,991         7.43%
                                      ----------   ----------    ----------   ----------    ----------   ----------
     Total                            $    8,528         5.10%   $   47,432         4.66%   $  264,492         4.61%
                                      ==========   ==========    ==========   ==========    ==========   ==========

<Caption>
                                                          Maturing
                                      --------------------------------------------------
                                          Over 10 Years                  Total
                                      -----------------------    -----------------------
                                        Amount       Yield         Amount       Yield
                                      ----------   ----------    ----------   ----------
  (Dollars in Thousands)
  ----------------------
<S>                                   <C>          <C>           <C>          <C>
Obligations of US
   Government Agencies                $   91,053         5.35%   $  314,908         4.68%
Obligations of States & Political
   Subdivisions                            9,248         4.69%       96,862         4.96%
Other Securities                          71,741         5.06%       80,724         5.23%
                                      ----------   ----------    ----------   ----------
     Total                            $  172,042         5.19%   $  492,494         4.83%
                                      ==========   ==========    ==========   ==========
</Table>



                                       12
<PAGE>

Our loan policies also reflect our awareness of the need for liquidity. We have
shortened the average terms for most of our loan portfolios, in particular real
estate mortgages, the majority of which are normally written for five years or
less. The following table shows the maturities or repricing opportunities
(whichever is earlier) for the Bank's interest earning assets and interest
bearing liabilities at December 31, 2004. The repricing assumptions shown are
consistent with those established by the Bank's Asset and Liability Management
Committee (ALCO). Savings accounts and regular NOW accounts are non-maturing,
variable rate deposits, which may reprice as often as daily, but are not
included in the zero to six month category because in actual practice, these
deposits are only repriced if there is a large change in market interest rates.
The effect of including these accounts in the zero to six-month category is
depicted in a subsequent table. Super NOW accounts and Money Market deposits are
also non-maturing, variable rate deposits, however, these accounts are included
in the zero to six-month category because they may get repriced following
smaller changes in market rates.

<Table>
<Caption>
                                            Assets/Liabilities at December 31, 2004, Maturing or Repricing in:
                                       ----------------------------------------------------------------------------
                                         0 - 6        6 - 12       1 - 2        2 - 5        Over 5        Total
     (Dollars in Thousands)              Months       Months       Years        Years        Years         Amount
     ----------------------            ----------   ----------   ----------   ----------   ----------    ----------
<S>                                    <C>          <C>          <C>          <C>          <C>           <C>
    Interest Earning Assets
    -----------------------
US Treas Secs & Obligations of
   US Gov't Agencies                   $  255,756   $   20,700   $   18,800   $   18,133   $    1,519    $  314,908
Obligations of States & Political
   Subdivisions                            16,895        8,877       29,132       12,638       29,320        96,862
Other Securities                           65,311        3,000           --        2,000       10,413        80,724
Commercial Loans                          318,899       31,085       89,073      168,246        1,892       609,195
Mortgage Loans                              8,487        4,846       47,401      119,372       33,876       213,982
Consumer Loans                             26,567       11,331       38,493       23,676       22,637       122,704
Federal Funds Sold                         14,000           --           --           --           --        14,000
                                       ----------   ----------   ----------   ----------   ----------    ----------
Total Interest Earning Assets          $  705,915   $   79,839   $  222,899   $  344,065   $   99,657    $1,452,375
                                       ----------   ----------   ----------   ----------   ----------    ----------

  Interest Bearing Liabilities
  ----------------------------
Interest Bearing Demand Deposits       $   56,970   $       --   $       --   $       --   $       --    $   56,970
Savings Deposits                          321,701           --           --           --           --       321,701
Other Time Deposits                       122,275       66,734      161,514       74,169       11,119       435,811
FHLB Advances                             123,000           --           --       15,000      118,500       256,500
Repurchase Agreements                       5,000       10,000        5,000       10,000       30,000
                                       ----------   ----------   ----------   ----------   ----------    ----------
Total Interest Bearing Liabilities     $  628,946   $   76,734   $  166,514   $   99,169   $  129,619    $1,100,982
                                       ----------   ----------   ----------   ----------   ----------    ----------

Gap                                    $   76,969   $    3,105   $   56,385   $  244,896   $  (29,962)   $  351,393
Cumulative Gap                         $   76,969   $   80,074   $  136,459   $  381,355   $  351,393    $  351,393

Sensitivity Ratio                            1.12         1.04         1.34         3.47         0.77          1.32
Cumulative Sensitivity Ratio                 1.12         1.11         1.16         1.39         1.32          1.32
</Table>



                                       13
<PAGE>

If savings and regular NOW accounts were included in the zero to six months
category, the Bank's gap would be as shown in the following table:

<Table>
<Caption>
                                             Assets/Liabilities at December 31, 2004, Maturing or Repricing in:
                                       -------------------------------------------------------------------------------
                                          0-6           6-12          1-2           2-5         Over 5
                                         Months        Months        Years         Years        Years         Total
                                       ----------    ----------    ----------    ----------   ----------    ----------
<S>                                    <C>           <C>           <C>           <C>          <C>           <C>
Total Interest Earning Assets          $  705,915    $   79,839    $  222,899    $  344,065   $   99,657    $1,452,375
Total Interest Bearing Liabilities     $  765,704    $   76,734    $  166,514    $   99,169   $  129,619    $1,237,740
                                       ----------    ----------    ----------    ----------   ----------    ----------

Gap                                    $  (59,789)   $    3,105    $   56,385    $  244,896   $  (29,962)   $  214,635
Cumulative Gap                         $  (59,789)   $  (56,684)   $     (299)   $  244,597   $  214,635    $  214,635

Sensitivity Ratio                            0.92          1.04          1.34          3.47         0.77          1.17
Cumulative Sensitivity Ratio                 0.92          0.93          1.00          1.22         1.17          1.17
</Table>

The amount of loans due after one year with floating interest rates is
$269,071,000.

The following table shows the remaining maturity for Certificates of Deposit
with balances of $100,000 or more as of December 31, 2004 (000s omitted):

<Table>
<Caption>
                                                        Year Ended December 31,
                                               ----------------------------------------
               (Dollars in Thousands)             2004           2003           2002
               ----------------------          ----------     ----------     ----------
<S>                                            <C>            <C>            <C>
         Maturing Within
               3 Months                        $   72,125     $   67,574     $   58,859
               3 - 6 Months                         9,481          6,933          7,456
               6 - 12 Months                       17,262          5,007         10,948
               Over 12 Months                      85,789         36,140         42,106
                                               ----------     ----------     ----------
         Total                                 $  184,657     $  115,654     $  119,369
                                               ==========     ==========     ==========
</Table>

For 2005, we expect the FOMC to continue to increase short term managed rates
through the first half of the year as the economic growth and potential for
inflation will allow the Fed to gradually move the fed funds rate from an
accommodative level to a neutral level. Since the fed began removing
accommodation in the second half of 2004, longer term market rates have
decreased. This flattening of the yield curve presents a challenge for us, as
the yields on our fixed rate assets are influenced by the longer term market
rates while the cost of many of our liabilities is influenced by shorter term
rates. This condition will make it difficult for us to increase our net interest
margin, and if it persists, we may experience a decrease in our margin. Recovery
in our region, which lags behind other areas due to the connection to the
automotive industry, is slowly gaining strength. We expect local loan demand
comparable to that which we experienced in 2004, with total loans increasing
between five and ten percent. We opened a new full service branch and regional
center in Wyandotte, Michigan in 2004. This is our fourth branch in southern
Wayne County, a market which is expected to contribute to our projected
increases in loans and deposits in 2005. This growth is expected to produce an
increase in Net Interest Income. We believe that our Allowance for Loan Losses
provides adequate coverage for the losses in our portfolio, and we expect that
we will be able to maintain the adequacy of the allowance without a significant
increase in the Provision for Loan Losses. We anticipate that slower mortgage
refinance activity and less gains on the sales of investment securities will
result in a small increase in non-interest income. Expenses related to our
additional offices and staffing increases will cause non-interest expenses to
increase. Primarily due to the anticipated increase in Net Interest Income, we
expect Net Income to increase slightly in 2005.



                                       14
<PAGE>

The following table shows the loan portfolio for the last five years.

<Table>
<Caption>
                                                                                       Book Value at December 31,
                                                                     --------------------------------------------------------------
         (Dollars in Thousands)                                       2004 (a)     2003 (a)     2002 (a)     2001 (a)     2000 (a)
         ----------------------                                      ----------   ----------   ----------   ----------   ----------
<S>                                                                  <C>          <C>          <C>          <C>          <C>
Loans secured by real estate:
     Construction and land development ...........................   $  155,703   $   86,221   $   56,780   $   47,025   $   36,146
     Secured by farmland (including farm residential
       and other improvements) ...................................        8,499        7,438        7,925
                                                                                                                 6,172        4,354
     Secured by 1-4 family residential properties ................      301,620      287,638      258,157      275,489      275,299
     Secured by multifamily (5 or more) residential properties ...        6,429        8,022        6,810        6,714        3,322
     Secured by nonfarm nonresidential properties ................      301,802      305,755      280,136      258,879      227,024

Loans to finance agricultural production and other
  loans to farmers ...............................................        2,333        2,263        2,182
                                                                                                                 2,856        2,832

Commercial and industrial loans to U.S. addresses (domicile) .....       87,068       92,313       90,838       99,186      150,805

Loans to individuals for household, family, and
  other personal expenditures (includes purchased paper):
     Credit cards and related plans ..............................          390          442        1,471        3,353        9,415
     Other .......................................................       80,761       72,542       68,942       87,322      102,089

Nonrated industrial development obligations (other than
  securities) of states and political subdivisions in the U.S ....           --           --           67          133          228

Other loans:
     Loans for purchasing or carrying securities (secured
       and unsecured) ............................................           --           --           --           --           --
     All other loans .............................................        1,297        1,228          497          696          609

Less: Any unearned income on loans ...............................           --           --           --           --           --
                                                                     ----------   ----------   ----------   ----------   ----------

Total loans and leases, net of unearned income ...................   $  945,902   $  863,862   $  773,805   $  787,825   $  812,123
                                                                     ==========   ==========   ==========   ==========   ==========

Nonaccrual loans .................................................   $   29,896   $   34,248   $   22,332   $   22,712   $   17,161
Loans 90 days or more past due ...................................   $      230   $      100   $       81   $      450   $      193
Troubled debt restructurings .....................................   $    3,715   $    4,755   $    6,807   $       --   $    1,057
</Table>

(a)  Loan categories are presented net of deferred loan fees. The presentation
     in Note 4 to the consolidated financial statements differs from this
     schedule presentation by presenting the loan categories, gross, before
     deferred loan fees have been subtracted.

The following is an analysis of the transactions in the allowance for loan
losses:

<Table>
<Caption>
                                                                                Year Ended December 31,
                                                       --------------------------------------------------------------------------
       (Dollars in Thousands)                             2004            2003            2002            2001            2000
       ----------------------                          ----------      ----------      ----------      ----------      ----------
<S>                                                    <C>             <C>             <C>             <C>             <C>
Balance Beginning of Period                            $   14,500      $   12,400      $   13,000      $   10,600      $    9,900

Loans Charged Off
    Domestic
       Commercial, Financial, and Agricultural              2,045           1,838           4,383           3,399           7,035
       Secured by Real Estate                                 468           3,389           2,859           1,242              --
       Loans to Individuals                                 1,935           1,456           1,455           1,523           1,091
Recoveries
    Domestic
       Commercial, Financial, and Agricultural                335             206           1,351             619           2,138
       Secured by Real Estate                                  57              33             135             111              --
       Loans to Individuals                                   865             539             510             434             390
                                                       ----------      ----------      ----------      ----------      ----------
Net Loans Charged Off                                       3,191           5,905           6,701           5,000           5,598
Provision Charged to Operations                             2,491           8,005           6,101           7,400           6,298
                                                       ----------      ----------      ----------      ----------      ----------
Balance End of Period                                  $   13,800      $   14,500      $   12,400      $   13,000      $   10,600
                                                       ==========      ==========      ==========      ==========      ==========

Ratio of Net Loans Charged Off to
    Average Total Loans Outstanding                          0.34%           0.69%           0.87%           0.59%           0.73%
                                                       ==========      ==========      ==========      ==========      ==========
</Table>


                                       15
<PAGE>



The following analysis shows the allocation of the allowance for loan losses:

<Table>
<Caption>
                                                                       Year Ended December 31,
                                  ----------------------------------------------------------------------------------------------
                                          2004                    2003                    2002                   2001
                                  ----------------------  ----------------------  ----------------------  ----------------------
                                     $    % of loans        $       % of loans      $       % of loans       $       % of loans
      (Dollars in Thousands)      Amount  to total loans  Amount  to total loans  Amount  to total loans  Amount  to total loans
      ----------------------      ------  --------------  ------  --------------  ------  --------------  ------  --------------
<S>                              <C>           <C>       <C>           <C>       <C>            <C>      <C>          <C>
Balance at end of period
  applicable to:
Domestic
    Commercial, Financial, and
      Agricultural               $ 1,421       10.3%     $ 1,582       11.7%     $ 2,933        13.1%    $ 4,119      13.8%
    Real Estate - Construction     2,277       16.5%         367        9.9%          94         7.3%        260       6.0%
    Real Estate - Mortgage         8,901       64.5%      11,506       69.7%       8,108        70.4%      8,038      68.6%
    Loans to Individuals           1,201        8.7%       1,045        8.7%       1,265         9.2%        583      11.6%
Foreign                               --        0.0%          --        0.0%          --         0.0%         --       0.0%
                                  ------  --------------  ------  --------------  ------  --------------  ------  --------------
    Total                        $13,800      100.0%     $14,500      100.0%     $12,400       100.0%    $13,000     100.0%
                                  ======  ==============  ======  ==============  ======  ==============  ======  ==============
</Table>



<Table>
<Caption>
                                   Year Ended December 31,
                                   -----------------------
                                            2000
                                   -----------------------
                                    $         % of loans
      (Dollars in Thousands)       Amount   to total loans
      ----------------------       ------   --------------
<S>                                  <C>        <C>
Balance at end of period
  applicable to:
Domestic
    Commercial, Financial, and
      Agricultural               $ 4,426       19.0%
    Real Estate - Construction       185        4.5%
    Real Estate - Mortgage         5,172       62.8%
    Loans to Individuals             817       13.7%
Foreign                               --        0.0%
                                 --------  --------------
    Total                        $10,600      100.0%
                                 ========  ==============
</Table>


Each period the provision for loan losses in the income statement results from
the combination of an estimate by Management of loan losses that occurred during
the current period and the ongoing adjustment of prior estimates of losses.

To serve as a basis for making this provision, the Bank maintains an extensive
credit risk monitoring process that considers several factors including: current
economic conditions affecting the Bank's customers, the payment performance of
individual loans and pools of homogeneous loans, portfolio seasoning, changes in
collateral values, and detailed reviews of specific loan relationships. For
loans deemed to be impaired due to an expectation that all contractual payments
will probably not be received, impairment is measured by comparing the Bank's
recorded investment in the loan to the present value of expected cash flows
discounted at the loan's effective interest rate, the fair value of the
collateral, or the loan's observable market price. Year-end nonperforming
assets, which include nonaccrual loans, loans ninety days or more past due,
renegotiated debt, nonaccrual securities, and other real estate owned, decreased
$7.8 million, or 20% from 2003 to 2004. Nonperforming assets as a percent of
total assets at year-end decreased from 3.3% in 2003 to 2.6% in 2004. The
Allowance for Loan Losses as a percent of nonperforming assets at year-end
increased from 30.4% in 2003 to 34.5% in 2004.

The provision for loan losses increases the allowance for loan losses, a
valuation account which appears on the consolidated statements of condition. As
the specific customer and amount of a loan loss is confirmed by gathering
additional information, taking collateral in full or partial settlement of the
loan, bankruptcy of the borrower, etc., the loan is charged off, reducing the
allowance for loan losses. If, subsequent to a charge off, the Bank is able to
collect additional amounts from the customer or sell collateral worth more than
earlier estimated, a recovery is recorded.

CONTRACTUAL OBLIGATIONS - The following table shows the Corporation's
contractual obligations.

<Table>
<Caption>
                                                       Payment Due by Period
                                  ------------------------------------------------------------
                                              Less than     1 - 3         3 - 5        Over 5
       (Dollars in Thousands)      Total        1 year       Years        Years        Years
        --------------------      --------     --------     --------     --------     --------
<S>                               <C>          <C>          <C>          <C>          <C>
Long Term Debt Obligations        $286,500     $  5,000     $ 15,000     $ 28,000     $238,500
Operating Lease Obligations            913          227          254          204          228
Salary Continuation Obligation         580            0            0           58          522
                                  --------     --------     --------     --------     --------
Total Interest Earning Assets     $287,993     $  5,227     $ 15,254     $ 28,262     $239,250
                                  ========     ========     ========     ========     ========
</Table>

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


The Bank faces market risk to the extent that the fair values of its financial
instruments are affected by changes in interest rates. The Bank does not face
market risk due to changes in foreign currency exchange rates, commodity prices,
or equity prices. The asset and liability management process of the Bank seeks
to monitor and manage the amount of interest rate risk. This is accomplished by
analyzing the differences in repricing opportunities for assets and



                                       16
<PAGE>

liabilities (gap analysis, as shown in Item 7), by simulating operating results
under varying interest rate scenarios, and by estimating the change in the net
present value of the Bank's assets and liabilities due to interest rate changes.

Each month, the Asset and Liability Committee (ALCO), which includes the senior
management of the Bank, estimates the effect of interest rate changes on the
projected net interest income of the Bank. The sensitivity of the Bank's net
interest income to changes in interest rates is measured by using a computer
based simulation model to estimate the impact on earnings of a gradual increase
or decrease of 100 basis points in the prime rate. The net interest income
projections are compared to a base case projection, which assumes no changes in
interest rates. The table below summarizes the net interest income sensitivity
as of December 31, 2004 and 2003.

<Table>
<Caption>
                                                Base         Rates       Rates
        (Dollars in Thousands)               Projection      Up 1%      Down 1%
        ----------------------               ----------    --------     -------
<S>                                         <C>             <C>         <C>
Year-End 2004 12 Month Projection
      Interest Income                          $86,596      $89,810     $83,098
      Interest Expense                          33,813       36,269      31,589
                                               -------      -------     -------
      Net Interest Income                      $52,783      $53,541     $51,509

      Percent Change From Base Projection                       1.4%      -2.4%
      ALCO Policy Limit (+/-)                                   5.0%       5.0%
</Table>

<Table>
<Caption>
                                                Base         Rates       Rates
        (Dollars in Thousands)               Projection      Up 1%      Down 1%
        ----------------------               ----------    --------     -------
<S>                                         <C>             <C>         <C>
Year-End 2003 12 Month Projection
      Interest Income                          $73,037      $76,410     $70,860
      Interest Expense                          26,907       31,027      24,558
                                               -------      -------     -------
      Net Interest Income                      $46,130      $45,383     $46,302

      Percent Change From Base Projection                      -1.6%        0.4%
      ALCO Policy Limit (+/-)                                   5.0%        5.0%
</Table>

The Bank's ALCO has established limits in the acceptable amount of interest rate
risk, as measured by the change in the Bank's projected net interest income, in
its policy. Throughout 2004, the estimated variability of the net interest
income was within the Bank's established policy limits.

The ALCO also monitors interest rate risk by estimating the effect of changes in
interest rates on the economic value of the Bank's equity each month. The actual
economic value of the Bank's equity is first determined by subtracting the fair
value of the Bank's liabilities from the fair value of the Bank's assets. The
fair values are determined in accordance with Statement of Financial Accounting
Standards Number 107, Disclosures about Fair Value of Financial Instruments. The
Bank estimates the interest rate risk by calculating the effect of market
interest rate shocks on the economic value of its equity. For this analysis, the
Bank assumes immediate increases or decreases of 100 and 200 basis points in the
prime lending rate. The discount rates used to determine the present values of
the loans and deposits, as well as the prepayment rates for the loans, are based
on Management's expectations of the effect of the rate shock on the market for
loans and deposits. The table below summarizes the amount of interest rate risk
to the fair value of the Bank's assets and liabilities and to the economic value
of the Bank's equity.



                                       17
<PAGE>




<Table>
<Caption>
                                                  Fair Value at December 31, 2004
                                                  -------------------------------
                                                              Rates
(Dollars in Thousands)         Base            Up 1%           Up 2%          Down 1%         Down 2%
-----------------------     ----------      ----------      ----------      ----------      ----------
<S>                         <C>             <C>             <C>             <C>             <C>
Assets                      $1,543,108      $1,513,190      $1,483,923      $1,572,426      $1,600,092
Liabilities                  1,387,831       1,358,581       1,330,434       1,418,237       1,449,845
                            ----------      ----------      ----------      ----------      ----------
Stockholders' Equity        $  155,277      $  154,609      $  153,489      $  154,189      $  150,247

Change in Equity                                 -0.4%           -1.2%           -0.7%           -3.2%
ALCO Policy Limit (+/-)                          15.0%           25.0%           15.0%           25.0%
</Table>


<Table>
<Caption>
                                                 Fair Value at December 31, 2003
                                                 -------------------------------
                                                              Rates
(Dollars in Thousands)         Base            Up 1%           Up 2%          Down 1%       Down 2%
-----------------------     ----------      ----------      ----------      ----------      -------
<S>                         <C>             <C>             <C>             <C>             <C>
Assets                      $1,459,412      $1,424,925      $1,390,429      $1,492,973          n/a
Liabilities                  1,328,318       1,301,174       1,275,051       1,355,079          n/a
                            ----------      ----------      ----------      ----------      -------
Stockholders' Equity        $  131,094      $  123,751      $  115,378      $  137,894          n/a

Change in Equity                                 -5.6%          -12.0%            5.2%          n/a
ALCO Policy Limit (+/-)                          15.0%           25.0%           15.0%         25.0%
</Table>

The Bank's ALCO has established limits in the acceptable amount of interest rate
risk, as measured by the change in economic value of the Bank's equity, in its
policy. Throughout 2004, the estimated variability of the economic value of
equity was within the Bank's established policy limits.



ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                   Financial Statements and Supplementary Data
See Pages 20 - 38.









                                       18
<PAGE>


     Report of Independent Registered Public Accounting Firm

     To the Board of Directors and Stockholders
     MBT Financial Corp. and Subsidiaries
     Monroe, Michigan


     We have audited the accompanying consolidated balance sheet of MBT
     Financial Corp. and Subsidiaries as of December 31, 2004 and December 31,
     2003 and the related consolidated statements of income, stockholders'
     equity, and cash flows for each year in the three year period ended
     December 31, 2004. These consolidated financial statements are the
     responsibility of the Company's management. Our responsibility is to
     express an opinion on these financial statements based on our audit.

     We conducted our audits in accordance with the standards of the Public
     Company Accounting Oversight Board (United States). Those standards require
     that we plan and perform the audit to obtain reasonable assurance about
     whether the financial statements are free of material misstatement. An
     audit includes examining, on a test basis, evidence supporting the amounts
     and disclosures in the financial statements. An audit also includes
     assessing the accounting principles used and significant estimates made by
     management, as well as evaluating the overall financial statement
     presentation. We believe that our audits provide a reasonable basis for our
     opinion.

     In our opinion, the financial statements referred to above present fairly,
     in all material respects, the consolidated financial position of MBT
     Financial Corp. and Subsidiaries as of December 31, 2004 and December 31,
     2003 and the consolidated results of its operations and its cash flows for
     each year in the three year period ended December 31, 2004, in conformity
     with U.S. generally accepted accounting principles.

     We have also audited, in accordance with the standards of the Public
     Company Accounting Oversight Board (United States), the effectiveness of
     MBT Financial Corp. and Subsidiaries' internal control over financial
     reporting as of December 31, 2004, based on criteria established in
     Internal Control-Integrated Framework issued by the committee of Sponsoring
     Organizations of the Treadway Commission and our report dated February 28,
     2005, expressed an unqualified opinion thereon.

     /s/ Plante & Moran, PLLC
     Auburn Hills, Michigan
     February 28, 2005



                                       19
<PAGE>


CONSOLIDATED BALANCE SHEETS

<Table>
<Caption>
                                                                                  DECEMBER 31,
 Dollars in thousands                                                       2004             2003
--------------------------------------------------------------------     -----------      -----------
<S>                                                                      <C>              <C>
ASSETS
Cash and Cash Equivalents (Note 2)
     Cash and due from banks                                             $    20,540      $    22,525
     Federal funds sold                                                       14,000               --
                                                                         -----------      -----------
      Total cash and cash equivalents                                         34,540           22,525

Securities - Held to Maturity (Notes 3 and 12)                                84,141           99,154
Securities - Available for Sale (Notes 3 and 12)                             408,353          397,642
Federal Home Loan Bank stock - at cost                                        12,947           11,686
Loans held for sale (Notes 4 and 12)                                             778            1,406
Loans - Net (Notes 4, 5, and 12)                                             931,303          847,944
Accrued interest receivable and other assets (Notes 7 and 13)                 58,047           59,407
Premises and Equipment - Net (Note 6)                                         22,170           18,024
                                                                         -----------      -----------
      Total assets                                                       $ 1,552,279      $ 1,457,788
                                                                         ===========      ===========

LIABILITIES
Deposits:
     Non-interest bearing                                                $   149,469      $   135,536
     Interest-bearing (Note 8)                                               951,242          903,581
                                                                         -----------      -----------
      Total deposits                                                       1,100,711        1,039,117

Federal Home Loan Bank advances (Notes 9 and 12)                             256,500          225,000
Federal funds purchased                                                           --           45,000
Securities sold under repurchase agreements                                   30,000               --
Interest payable and other liabilities (Note 10)                               9,722            5,225
                                                                         -----------      -----------
      Total liabilities                                                    1,396,933        1,314,342
                                                                         -----------      -----------

STOCKHOLDERS' EQUITY
Common stock (no par value; 30,000,000 shares authorized, 17,465,839
     and 17,491,784 shares issued and outstanding) (Note 11)                      --               --
Additional paid-in capital                                                    19,806           20,414
Retained Earnings                                                            135,647          123,867
Accumulated other comprehensive loss                                            (107)            (835)
                                                                         -----------      -----------
      Total stockholders' equity                                             155,346          143,446
                                                                         ===========      ===========
      Total liabilities and stockholders' equity                         $ 1,552,279      $ 1,457,788
                                                                         ===========      ===========
</Table>


The accompanying notes are an integral part of these statements.



                                       20
<PAGE>


CONSOLIDATED STATEMENTS OF INCOME

<Table>
<Caption>
                                                          YEARS ENDED DECEMBER 31,
Dollars in thousands                                  2004        2003         2002
------------------------------------------------     -------     -------     -------
<S>                                                  <C>         <C>         <C>
INTEREST INCOME
Interest and fees on loans                           $57,660     $55,253     $59,180
Interest on investment securities-
     Tax-exempt                                        5,613       6,206       6,741
     Taxable                                          16,420      16,166      18,134
Interest on federal funds sold                            10         149         549
                                                     -------     -------     -------
          Total interest income                       79,703      77,774      84,604
                                                     -------     -------     -------

INTEREST EXPENSE
Interest on deposits                                  14,923      15,991      21,469
Interest on borrowed funds                            12,075      11,476      12,918
                                                     -------     -------     -------
          Total interest expense                      26,998      27,467      34,387
                                                     -------     -------     -------

NET INTEREST INCOME                                   52,705      50,307      50,217
PROVISION FOR LOAN LOSSES (Note 5)                     2,491       8,005       6,101
                                                     -------     -------     -------

NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES                             50,214      42,302      44,116
                                                     -------     -------     -------

OTHER INCOME
Income from trust services                             3,746       3,316       3,497
Service charges and other fees                         5,476       5,309       4,522
Net gain on sales of securities                          567       1,041       1,325
Other                                                  3,987       4,137       3,447
                                                     -------     -------     -------
          Total other income                          13,776      13,803      12,791
                                                     -------     -------     -------

OTHER EXPENSES
Salaries and employee benefits (Notes 10 and 16)      18,109      16,122      14,224
Occupancy expense                                      3,029       2,696       2,328
Other                                                 11,478      11,361      10,437
                                                     -------     -------     -------
          Total other expenses                        32,616      30,179      26,989
                                                     -------     -------     -------

INCOME BEFORE PROVISION
FOR INCOME TAXES                                      31,374      25,926      29,918
PROVISION FOR INCOME TAXES (Note 13)                   8,775       6,611       8,114
                                                     -------     -------     -------
NET INCOME                                           $22,599     $19,315     $21,804
                                                     =======     =======     =======



BASIC EARNINGS PER COMMON SHARE                      $  1.30     $  1.02     $  1.12
                                                     =======     =======     =======

DILUTED EARNINGS PER COMMON SHARE (Note 15)          $  1.29     $  1.01     $  1.12
                                                     =======     =======     =======
</Table>



The accompanying notes are an integral part of these statements.


                                       21
<PAGE>



CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

<Table>
<Caption>
                                                                                                  ACCUMULATED
                                                            ADDITIONAL                               OTHER
                                                             PAID-IN           RETAINED          COMPREHENSIVE
 Dollars in thousands                                        CAPITAL           EARNINGS           INCOME (LOSS)           TOTAL
----------------------------------------------------     --------------      --------------      --------------      --------------
<S>                                                      <C>                 <C>                 <C>                 <C>
 BALANCE - JANUARY 1, 2002                               $       58,989      $      104,056      $       (1,315)     $      161,730

 Repurchase of Common Stock (591,101 shares)
 (Note 11)                                                       (7,909)                 --                  --              (7,909)
 Dividends declared ($0.54 per share)                                --             (10,465)                 --             (10,465)
 Comprehensive income:
     Net income                                                      --              21,804                  --              21,804
     Change in net unrealized loss on securities
     available for sale - Net of tax effect of
     $990 and reclassifications of $875                              --                  --               1,839               1,839
                                                         --------------      --------------      --------------      --------------

        Total Comprehensive Income                                   --              21,804               1,839              23,643
                                                         --------------      --------------      --------------      --------------
 BALANCE - DECEMBER 31, 2002                             $       51,080      $      115,395      $          524      $      166,999

 Repurchase of Common Stock (1,692,475 shares)
 (Note 11)                                                      (31,008)                 --                  --             (31,008)
 Issuance of Common Stock
     Stock options exercised (23,818 shares)                        272                  --                  --                 272
     Other stock issued (4,171 shares)                               70                  --                  --                  70
 Dividends declared ($0.58 per share)                                --             (10,843)                 --             (10,843)
 Comprehensive income:
     Net income                                                      --              19,315                  --              19,315
     Change in net unrealized loss on securities
     available for sale - Net of tax effect of
     $732 and reclassifications of $685                              --                  --              (1,359)             (1,359)
                                                         --------------      --------------      --------------      --------------
        Total Comprehensive Income                                   --              19,315              (1,359)             17,956
                                                         --------------      --------------      --------------      --------------
 BALANCE - DECEMBER 31, 2003                             $       20,414      $      123,867      $         (835)     $      143,446

 Repurchase of Common Stock (220,000 shares)
 (Note 11)                                                       (3,873)                 --                  --              (3,873)
 Issuance of Common Stock (194,055 shares)
     Stock options exercised (183,915 shares)                     2,753                  --                  --               2,753
     Other stock issued (10,140 shares)                             187                  --                  --                 187
 Tax benefit from exercise of options                               325                  --                  --                 325
 Dividends declared ($0.62 per share)                                --             (10,819)                 --             (10,819)
 Comprehensive income:
     Net income                                                      --              22,599                  --              22,599
     Change in net unrealized loss on securities
     available for sale - Net of tax effect of $(392)                --                  --                 728                 728
                                                         --------------      --------------      --------------      --------------
        Total Comprehensive Income                                   --              22,599                 728              23,327
                                                         ==============      ==============      ==============      ==============
 BALANCE - DECEMBER 31, 2004                             $       19,806      $      135,647      $         (107)     $      155,346
                                                         ==============      ==============      ==============      ==============
</Table>

The accompanying notes are an integral part of these statements.



                                       22
<PAGE>



CONSOLIDATED STATEMENTS OF CASH FLOWS

<Table>
<Caption>
                                                                                      YEARS ENDED DECEMBER 31,
 Dollars in thousands                                                            2004           2003           2002
--------------------------------------------------------------------------     ---------      ---------      ---------
<S>                                                                            <C>            <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income                                                                     $  22,599      $  19,315      $  21,804
Adjustments to reconcile net income to net cash from operating activities
     Provision for deferred taxes                                                    195           (737)         1,607
     Provision for loan losses                                                     2,491          8,005          6,101
     Depreciation                                                                  2,817          2,471          2,102
     Net (Accretion) Amortization on investment securities                           496          2,981         (2,657)
     Net gain on sales of securities                                                (567)        (1,041)        (1,325)
     Increase in cash surrender value of life insurance                           (1,371)        (1,305)          (797)
     Change in assets and liabilities
     (Increase) decrease in accrued interest receivable and other assets          (4,261)        (3,666)         1,623
     Increase (decrease) in accrued interest payable and other liabilities         4,822         (1,510)        (1,823)
                                                                               ---------      ---------      ---------
        Net cash provided by operating activities                              $  27,221      $  24,513      $  26,635
                                                                               ---------      ---------      ---------

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities of investment securities held to maturity             $  25,610      $  27,956      $  59,980
Proceeds from maturities of investment securities available for sale              66,369        355,635        479,090
Proceeds from sales of investment securities available for sale                   73,520        176,905         52,621
Net (increase) decrease in loans                                                 (85,222)       (95,950)        (5,618)
Proceeds from sales of other real estate owned                                     6,235         12,068          1,720
Proceeds from sales of other assets                                                   71             13            113
Purchase of investment securities held to maturity                               (10,565)       (10,300)       (10,959)
Purchase of bank owned life insurance                                                 --        (15,490)          (729)
Purchase of investment securities available for sale                            (150,701)      (522,972)      (616,156)
Purchase of bank premises and equipment                                           (7,035)        (5,058)        (3,038)
                                                                               ---------      ---------      ---------
     Net cash used for investing activities                                    $ (81,718)     $ (77,193)     $ (42,976)
                                                                               ---------      ---------      ---------

CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in deposits                                                       $  61,594      $  28,157      $  12,080
Net increase (decrease) in short term borrowings                                 (45,000)        45,000             --
Net increase in Federal Home Loan Bank borrowings                                 31,500             --             --
Net increase is securities sold under repurchase agreements                       30,000             --             --
Repurchase of common stock                                                        (3,873)       (31,008)        (7,909)
Issuance of common stock                                                           2,940            342             --
Dividends paid                                                                   (10,649)       (10,904)       (10,349)
                                                                               ---------      ---------      ---------
     Net cash provided by (used for) financing activities                      $  66,512      $  31,587      $  (6,178)
                                                                               ---------      ---------      ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                           $  12,015      $ (21,093)     $ (22,519)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR (Note 1)                           22,525         43,618         66,137
                                                                               ---------      ---------      ---------
CASH AND CASH EQUIVALENTS AT END OF YEAR (Note 1)                              $  34,540      $  22,525      $  43,618
                                                                               =========      =========      =========


SUPPLEMENTAL CASH FLOW INFORMATION
     Cash paid for interest                                                    $  26,835      $  27,646      $  25,295
     Cash paid for federal income taxes                                        $  7,135       $   7,120      $   8,870
                                                                               =========      =========      =========

SUPPLEMENTAL SCHEDULE OF NON CASH INVESTING ACTIVITIES
     Transfer of loans to other real estate owned                              $   5,461      $   6,169      $  12,932
     Transfer of loans to other assets                                         $      55      $      44      $       4
                                                                               =========      =========      =========
</Table>

The accompanying notes are an integral part of these statements.





                                       23
<PAGE>


 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
     The consolidated financial statements include the accounts of MBT Financial
     Corp. (the "Corporation") and its wholly owned subsidiary, Monroe Bank &
     Trust (the "Bank"). The Bank includes the accounts of its wholly owned
     subsidiaries, MBT Credit Company, Inc. and MB&T Financial Services, Inc.
     The Bank operates twenty-one offices in Monroe County, Michigan and four
     offices in Wayne County, Michigan. MBT Credit Company, Inc. operates a
     mortgage loan office in Monroe County. The Bank's primary source of revenue
     is from providing loans to customers, who are predominantly small and
     middle-market businesses and middle-income individuals. The Corporation's
     sole business segment is community banking.

     The accounting and reporting policies of the Bank conform to practice
     within the banking industry and are in accordance with accounting
     principles generally accepted in the United States. Preparation of
     financial statements in conformity with generally accepted accounting
     principles requires Management to make estimates and assumptions that
     affect the reported amounts of assets and liabilities and disclosure of
     contingent assets and liabilities at the date of the financial statements
     and the reported amounts of revenues and expenses during the reporting
     period. Actual results could differ from those estimates. Material
     estimates that are particularly susceptible to significant changes in the
     near term are the determination of the allowance for loan losses and the
     valuation of other real estate owned.

     The significant accounting policies are as follows:

     PRINCIPLES OF CONSOLIDATION
     The consolidated financial statements include the accounts of the
     Corporation and its subsidiary. All material intercompany transactions and
     balances have been eliminated. Certain prior year amounts have been
     reclassified to conform to the current year presentation.

     SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK
     Most of the Corporation's activities are with customers located within
     southeast Michigan. Notes 3 and 4 discuss the types of securities and
     lending that the Corporation engages in. The Corporation does not have any
     significant concentrations in any one industry or to any one customer.

     INVESTMENT SECURITIES
     Investment securities that are "held to maturity" are stated at cost, and
     adjusted for accumulated amortization of premium and accretion of discount.
     The Bank has the intention and, in Management's opinion, the ability to
     hold these investment securities until maturity. Investment securities that
     are "available for sale" are stated at estimated market value, with the
     related unrealized gains and losses reported as an amount, net of taxes, as
     a separate component of stockholders' equity. The market value of
     securities is based on quoted market prices. For securities that do not
     have readily available market values, estimated market values are
     calculated based on the market values of comparable securities. Gains and
     losses on the sale of securities are determined using the specific
     identification method. Premiums and discounts are recognized in interest
     income using the interest method over the term of the security.

     LOANS
     The Bank grants mortgage, commercial, and consumer loans to customers.
     Loans are reported at their outstanding unpaid principal balances, adjusted
     for charge offs, the allowance for loan losses, and any deferred fees or
     costs on originated loans. Interest income is accrued on the unpaid
     principal balance. Loan origination fees, net of certain direct origination
     costs, are deferred and recognized as an adjustment of the related loan
     yield using the interest method.

     The accrual of interest on loans is discontinued at the time the loan is 90
     days delinquent unless the credit is well secured and in the process of
     collection. In all cases, loans are placed on nonaccrual or charged off at
     an earlier date if principal or interest is considered doubtful.

     All interest accrued but not collected for loans that are placed on
     nonaccrual or charged off is reversed against interest income. The interest
     on these loans is accounted for on the cash basis or cost recovery method,
     until qualifying for return to accrual. Loans are returned to accrual
     status when all the principal and interest amounts contractually due are
     brought current and future payments are reasonably assured.

     LOANS HELD FOR SALE
     Loans held for sale consist of fixed rate residential mortgage loans with
     maturities of 15 to 30 years. Such loans are recorded at the lower of
     aggregate cost or estimated fair value.



                                       24
<PAGE>


     ALLOWANCE FOR LOAN LOSSES
     The allowance for loan losses is established as losses are estimated to
     have occurred through a provision for loan losses charged to earnings. Loan
     losses are charged against the allowance when management believes the
     uncollectibility of a loan balance is confirmed. Subsequent recoveries, if
     any, are credited to the allowance.

     The allowance for loan losses is evaluated on a regular basis by management
     and is based upon management's periodic review of the collectibility of the
     loans in light of historical experience, the nature and volume of the loan
     portfolio, adverse situations that may affect the borrower's ability to
     repay, estimated value of any underlying collateral and prevailing economic
     conditions. This evaluation is inherently subjective as it requires
     estimates that are susceptible to significant revision as more information
     becomes available.

     The allowance consists of specific, general and unallocated components. The
     specific component relates to loans that are classified as doubtful or
     substandard. For such loans that are also classified as impaired, an
     allowance is established when the discounted cash flows (or collateral
     value or observable market price) of the impaired loan is lower than the
     carrying value of that loan. The general component covers non-classified
     loans and is based on historical loss experience, adjusted for qualitative
     factors. An unallocated component is maintained to cover uncertainties that
     could affect management's estimate of probable losses. The unallocated
     component of the allowance reflects the margin of imprecision inherent in
     the underlying assumptions used in the methodologies for estimating
     specific and general losses in the portfolio.

     A loan is considered impaired when, based on current information and
     events, it is probable that the Corporation will be unable to collect the
     scheduled payments of principal or interest when due according to the
     contractual terms of the loan agreement. Factors considered by management
     in determining impairment include payment status, collateral value, and the
     probability of collecting scheduled principal and interest payments when
     due. Loans that experience insignificant payment delays and payment
     shortfalls generally are not classified as impaired. Management determines
     the significance of payment delays and payment shortfalls on a case-by-case
     basis, taking into consideration all of the circumstances surrounding the
     loan and the borrower, including length of the delay, the reasons for the
     delay, the borrower's prior payment record, and the amount of the shortfall
     in relation to the principal and interest owed. Impairment is measured on a
     loan by loan basis for commercial and construction loans by either the
     present value of expected future cash flows discounted at the loan's
     effective interest rate, the loan's obtainable market price, or the fair
     value of the collateral if the loan is collateral dependent.

     Large groups of homogeneous loans are collectively evaluated for
     impairment. Accordingly, the Corporation does not separately identify
     individual consumer and residential loans for impairment disclosures.

     FORECLOSED ASSETS (INCLUDES OTHER REAL ESTATE OWNED)
     Assets acquired through, or in lieu of, loan foreclosure are held for sale
     and are initially recorded at the lower of fair value or the loan carrying
     amount at the date of the foreclosure, establishing a new cost basis.
     Subsequent to foreclosure, valuations are periodically performed by
     Management and the assets are carried at the lower of carrying amount or
     fair value less cost to sell. Revenue and expenses from operations and
     changes in the valuation allowance are included in net expenses from
     foreclosed assets.

     BANK PREMISES AND EQUIPMENT
     Bank premises and equipment are stated at cost, less accumulated
     depreciation of $25,427,000 in 2004 and $22,903,000 in 2003. The Bank uses
     the straight-line method to provide for depreciation, which is charged to
     operations over the estimated useful lives of the assets. Depreciation
     expense amounted to $2,817,000 in 2004, $2,471,000 in 2003, and $2,102,000
     in 2002.

     The cost of assets retired and the related accumulated depreciation are
     eliminated from the accounts and the resulting gains or losses are
     reflected in operations in the year the assets are retired.

     COMPREHENSIVE INCOME
     Accounting principles generally require that revenue, expenses, gains, and
     losses be included in net income. Certain changes in assets and
     liabilities, however, such as unrealized gains and losses on securities
     available for sale, are reported as a separate component of the equity
     section of the balance sheet. Such items, along with net income, are
     components of comprehensive income.

     The components of accumulated other comprehensive income (loss) and related
tax effects are as follows:

<Table>
<Caption>
Dollars in thousands                                            2004          2003
----------------------------------------------------------     -------      -------
<S>                                                            <C>          <C>
Unrealized gains (losses) on securities available for sale     $  (164)     $(1,285)
Tax effect                                                          57          450
                                                               -------      -------
Accumulated other comprehensive income (loss)                  $  (107)     $  (835)
                                                               =======      =======
</Table>




                                       25
<PAGE>


     CASH AND CASH EQUIVALENTS
     Cash and Cash Equivalents include cash and due from banks and Federal funds
     sold. Generally, cash equivalents have daily maturities.

     INCOME TAXES
     Deferred income tax assets and liabilities are determined using the
     liability (or balance sheet) method. Under this method, the net deferred
     tax asset or liability is determined based on the tax effects of the
     various temporary differences between the book and tax bases of the various
     balance sheet assets and liabilities and gives current recognition to
     changes in tax rates and laws.

     STOCK-BASED COMPENSATION
     The Company applies the provisions of APB Opinion No. 25, "Accounting for
     Stock-Based Compensation," for all employee stock option grants and has
     elected to disclose pro forma net income and earnings per share amounts as
     if the fair-value based method has been applied in measuring compensation
     costs.

     The Company's as reported and pro forma information for the years ended
December 31:

<Table>
<Caption>
Dollars in thousands, except per share data    2004             2003           2002
-------------------------------------------  ----------      ----------      ----------
<S>                                          <C>             <C>             <C>
      Net Income as Reported                 $   22,599      $   19,315      $   21,804
      Pro Forma Adjustment
         Due to Stock Options                      (403)           (258)           (350)
                                             ----------      ----------      ----------
      Pro Forma Net Income                   $   22,196      $   19,057      $   21,454
                                             ==========      ==========      ==========

      Earnings per Share as Reported
         Basic                               $     1.30      $     1.02      $     1.12
         Diluted                             $     1.29      $     1.01      $     1.12
      Pro Forma Earnings per Share
         Basic                               $     1.27      $     1.00      $     1.10
         Diluted                             $     1.27      $     1.00      $     1.10
</Table>


     Compensation expense in the pro forma disclosures is not indicative of
     future amounts, as options vest over several years and additional grants
     are generally made each year.

     The weighted average fair value of options granted was $3.84, $3.04 and
     $3.19 in 2004, 2003 and 2002, respectively. The fair value of each option
     grant is estimated on the date of grant using the Black-Scholes
     option-pricing model with the following assumptions used for grants in
     2004, 2003 and 2002: expected option lives of seven years for all three;
     expected volatility of 25.3%, 23.9% and 23.9%, risk-free interest rates of
     3.8%, 4.6% and 4.6%, and dividend yield of 2.0%, 3.0% and 3.0%,
     respectively.

     OFF BALANCE SHEET INSTRUMENTS
     In the ordinary course of business, the Corporation has entered into
     commitments to extend credit, including commitments under credit card
     arrangements, commercial letters of credit and standby letters of credit.

     In November 2002, the FASB issued Interpretation No. 45, (FIN 45)
     "Guarantor's Accounting and Disclosure Requirements for Guarantees,
     Including Indirect Guarantees of Indebtedness of Others," which elaborates
     on the disclosures to be made by a guarantor about its obligations under
     certain guarantees issued. It also clarifies that a guarantor is required
     to recognize, at the inception of a guarantee, a liability for the fair
     value of the obligation undertaken in issuing the guarantee. The initial
     recognition and measurement provisions of this Interpretation have been
     applied on a prospective basis to guarantees issued or modified after
     December 31, 2002. However, the value of such guarantees is immaterial and
     the adoption of this Standard did not have a material effect on the
     Corporation's financial statements.

     ACCOUNTING PRONOUNCEMENTS
     In December 2004, the Financial Accounting Standards Board (FASB) issued
     SFAS 123 (revised 2004), "Share Based Payment," which revises SFAS 123,
     "Accounting for Stock Based Compensation," and supersedes APB Opinion 25,
     "Accounting for Stock Issued to Employees." This Statement requires an
     entity to recognize the cost of employee services received in share based
     payment transaction and measure the cost on a grant date fair value of the
     award. That cost will be recognized over the period during which an
     employee is required to provide services in exchange for the award. The
     provisions of SFAS 123 (revised 2004) will be effective for the Company's
     financial statements issued for periods beginning after June 15, 2005. The
     Company plans to adopt the modified prospective application of SFAS 123
     (revised 2004) in the third quarter of 2005. The anticipated impact on net
     income is not expected to be material.

     In March 2004, the Financial Accounting Standards Board (FASB) ratified the
     consensus reached by the Emerging Issues Task Force (EITF) in Issue 03-1,
     "The Meaning of Other Than Temporary Impairment and its Application to
     Certain Investments" (EITF 03-1). EITF 03-1 provides guidance for
     determining when an investment is considered impaired, whether impairment
     is other than temporary, and measurement of an impairment loss. In
     September 2004, the FASB issued FSP 03-1-1, which delayed the effective
     date for the measurement and recognition guidance contained in paragraphs
     10-20 of Issue 03-1 due to additional proposed guidance. The disclosure
     required by EITF 03-1 is in Note 3 to the Consolidated Financial
     Statements.



                                       26
<PAGE>

     In March 2004, the SEC issued Staff Accounting Bulletin 105, "Application
     of Accounting Principles to Loan Commitments" (SAB 105). This bulletin was
     issued to inform registrants of the SEC's view that the fair value of the
     recorded loan commitments, which are required to follow derivative
     accounting under FAS 133, "Accounting for Derivative Instruments and
     Hedging Activities," should not consider the expected future cash flows
     related to the associated servicing of the future loan. The provisions of
     SAB 105 must be applied to loan commitments accounted for as derivative
     that are entered into after March 31, 2004. The adoption of this Staff
     Accounting Bulletin in the second quarter of 2004 did not have a material
     impact on MBT Financial Corp.

(2)  CASH AND DUE FROM BANKS
     The Bank is required by regulatory agencies to maintain legal reserve
     requirements based on the level of balances in deposit categories. Cash
     balances restricted from usage due to these requirements were $1,954,000
     and $1,532,000 at December 31, 2004 and 2003, respectively. Cash and due
     from banks includes deposits held at correspondent banks in excess of FDIC
     insurance limits.

(3)  INVESTMENT SECURITIES
     The following is a summary of the Bank's investment securities portfolio as
     of December 31, 2004 and 2003 (000's omitted):


<Table>
<Caption>
                                                            HELD TO MATURITY
                                                            DECEMBER 31, 2004
                                                         GROSS           GROSS         ESTIMATED
                                         AMORTIZED     UNREALIZED      UNREALIZED        MARKET
                                           COST          GAINS           LOSSES           VALUE
                                        ----------     ----------      ----------      ----------
<S>                                     <C>            <C>             <C>             <C>
Obligations of U.S. Government
      Agencies                          $      527     $       51      $       --      $      578
Obligations of States and Political
      Subdivisions                          80,622          2,161            (147)         82,636
Other Securities                             2,992             82              --           3,074
                                        ----------     ----------      ----------      ----------
                                        $   84,141     $    2,294      $     (147)     $   86,288
                                        ==========     ==========      ==========      ==========
</Table>

<Table>
<Caption>
                                                            AVAILABLE FOR SALE
                                                             DECEMBER 31, 2004
                                                         GROSS           GROSS         ESTIMATED
                                        AMORTIZED      UNREALIZED      UNREALIZED       MARKET
                                          COST           GAINS           LOSSES          VALUE
                                        ----------     ----------      ----------      ----------
<S>                                     <C>            <C>             <C>             <C>
Obligations of U.S. Government
      Agencies                          $  315,410     $    1,123      $   (2,152)     $  314,381
Obligations of States and Political
      Subdivisions                          28,635            812            (260)         29,187
Other Securities                            64,472            397             (84)         64,785
                                        ----------     ----------      ----------      ----------
                                        $  408,517     $    2,332      $   (2,496)     $  408,353
                                        ==========     ==========      ==========      ==========
</Table>

<Table>
<Caption>
                                                            HELD TO MATURITY
                                                           DECEMBER 31, 2003
                                                         GROSS           GROSS         ESTIMATED
                                        AMORTIZED      UNREALIZED      UNREALIZED       MARKET
                                           COST          GAINS           LOSSES          VALUE
                                        ----------     ----------      ----------      ----------
<S>                                     <C>            <C>             <C>             <C>
Obligations of U.S. Government
      Agencies                          $      536     $       54      $       --      $      590
Obligations of States and Political
      Subdivisions                          95,634          3,744            (144)         99,234
Other Securities                             2,984            132              --           3,116
                                        ----------     ----------      ----------      ----------
                                        $   99,154     $    3,930      $     (144)     $  102,940
                                        ==========     ==========      ==========      ==========
</Table>

<Table>
<Caption>
                                                             AVAILABLE FOR SALE
                                                              DECEMBER 31, 2003
                                                          GROSS          GROSS          ESTIMATED
                                         AMORTIZED     UNREALIZED      UNREALIZED        MARKET
                                           COST           GAINS          LOSSES           VALUE
                                        ----------     ----------      ----------      ----------
<S>                                     <C>            <C>             <C>             <C>
Obligations of U.S. Government
      Agencies                          $  315,004     $      450      $   (3,510)     $  311,944
Obligations of States and Political
      Subdivisions                          26,047            829            (403)         26,473
Other Securities                            57,876          1,374             (25)         59,225
                                        ----------     ----------      ----------      ----------
                                        $  398,927     $    2,653      $   (3,938)     $  397,642
                                        ==========     ==========      ==========      ==========
</Table>


                                       27
<PAGE>

     The amortized cost and estimated market value of securities at December 31,
     2004, by contractual maturity, are shown below. Expected maturities will
     differ from contractual maturities because issuers may have the right to
     call or prepay obligations with or without call or prepayment penalties
     (000's omitted).

<Table>
<Caption>
                                             HELD TO MATURITY              AVAILABLE FOR SALE
                                                       ESTIMATED                       ESTIMATED
                                        AMORTIZED        MARKET        AMORTIZED         MARKET
                                           COST          VALUE           COST            VALUE
                                        ----------     ----------      ----------      ----------
<S>                                     <C>            <C>             <C>             <C>
Maturing within
      1 year                            $   11,576     $   11,717      $       --      $       --
      1 to 5 years                          36,212         37,311          16,985          16,977
      5 to 10 years                         29,227         30,112         237,659         237,405
      Over 10 years                          7,126          7,148         152,860         152,900
Securities with no stated maturity              --             --           1,013           1,071
                                        ----------     ----------      ----------      ----------
                                        $   84,141     $   86,288      $  408,517      $  408,353
                                        ==========     ==========      ==========      ==========
</Table>


     The investment securities portfolio is evaluated for impairment throughout
     the year. Impairment is recorded against individual securities, unless the
     decrease in fair value is attributable to interest rates and management
     determines that the Company has the intent and ability to hold the
     investment for a period of time sufficient to allow for an anticipated
     recovery in the market value. The fair values of investments with an
     amortized cost in excess of their fair values at December 31, 2004 and
     December 31, 2003 are as follows:

<Table>
<Caption>
                                               DECEMBER 31, 2004

                                  LESS THAN 12 MONTHS       12 MONTHS OR LONGER             TOTAL
                                 ---------------------     ---------------------    -----------------------
                                               GROSS                     GROSS                      GROSS
                                 AGGREGATE   UNREALIZED   AGGREGATE    UNREALIZED    AGGREGATE   UNREALIZED
                                FAIR VALUE     LOSSES     FAIR VALUE     LOSSES     FAIR VALUE     LOSSES
                                ---------    ----------   ----------   ----------   ----------   ----------
<S>                             <C>          <C>          <C>          <C>          <C>          <C>
Obligations of United States
      Government Agencies        $144,904     $  1,703     $ 18,551     $    449     $163,455     $  2,152
Obligations of States and
      Political Subdivisions        6,423           58        2,692          349     $  9,115     $    407
Other Securities                   12,795           84           --           --     $ 12,795     $     84
                                 --------     --------     --------     --------     --------     --------
                                 $164,122     $  1,845     $ 21,243     $    798     $185,365     $  2,643
                                 ========     ========     ========     ========     ========     ========
</Table>

<Table>
<Caption>
                                                DECEMBER 31, 2003

                                  LESS THAN 12 MONTHS       12 MONTHS OR LONGER              TOTAL
                                 ---------------------     ---------------------     ---------------------
                                               GROSS                     GROSS                     GROSS
                                AGGREGATE    UNREALIZED    AGGREGATE   UNREALIZED    AGGREGATE   UNREALIZED
                                FAIR VALUE     LOSSES     FAIR VALUE     LOSSES     FAIR VALUE     LOSSES
                                ---------    ----------   ----------   ----------   ----------   ----------
<S>                             <C>          <C>          <C>          <C>          <C>          <C>
Obligations of United States
      Government Agencies        $210,556     $  3,510     $     --     $     --     $210,556     $  3,510
Obligations of States and
      Political Subdivisions        7,554          178        1,196          369     $  8,750     $    547
Other Securities                      561            9        5,321           16     $  5,882     $     25
                                 --------     --------     --------     --------     --------     --------
                                 $218,671     $  3,697     $  6,517     $    385     $225,188     $  4,082
                                 ========     ========     ========     ========     ========     ========
</Table>


     Investment securities carried at $322,959,000 and $307,005,000 were pledged
     or set aside to secure borrowings, public and trust deposits, and for other
     purposes required by law at December 31, 2004 and December 31, 2003,
     respectively.

     At December 31, 2004, Obligations of U. S. Government Agencies included
     securities issued by the Federal Home Loan Bank with an estimated market
     value of $160,741,000. At December 31, 2003, Obligations of U. S.
     Government Agencies included securities issued by the Federal Home Loan
     Bank with an estimated market value of $166,937,000.

     For the years ended December 31, 2004, 2003 and 2002, proceeds from sales
     of securities amounted to $73,520,000, $176,905,000 and $52,621,000,
     respectively. Gross realized gains amounted to $1,174,000, $1,046,000 and
     $1,325,000, respectively. Gross realized losses amounted to $607,000,
     $5,000 and $0, respectively. The tax provision applicable to these net
     realized gains and losses amounted to $179,000, $364,000 and $464,000,
     respectively.



                                       28
<PAGE>


(4) LOANS
     Loan balances outstanding as of December 31 consist of the following (000s
omitted):

                                                        2004         2003
                                                      --------     --------
Real estate loans                                     $774,670     $695,677
Loans to finance agricultural production and
      other loans to farmers                             2,333        2,263
Commercial and industrial loans                         88,035       93,444
Loans to individuals for household, family,
      and other personal expenditures                   81,119       72,972
All other loans (including overdrafts)                   1,297        1,228
                                                      --------     --------
           Total loans, gross                         $947,454     $865,584
           Less: Deferred loan fees                      1,573        1,734
                                                      --------     --------
           Total loans, net of deferred loan fees     $945,881     $863,850
           Less: Allowance for loan losses              13,800       14,500
                                                      --------     --------
                                                      $932,081     $849,350
                                                      ========     ========

     The following is a summary of impaired loans (000s omitted):

<Table>
<Caption>
                                                                       2004        2003        2002
                                                                     -------     -------     -------
<S>                                                                  <C>         <C>         <C>
Year-end impaired loans with no allowance for loan losses            $ 3,809     $11,212     $37,201
allocated
Year-end impaired loans with allowance for loan losses allocated      30,136      32,379      60,898
Year-end allowance for loan losses allocated to impaired loans         6,014       6,873       7,291
Average investment in impaired loans                                  33,410      30,112      57,738
Interest income recognized on impaired loans                           1,120       1,506       3,486
Cash basis interest income recognized on impaired loans during         1,120       1,506       3,486
the year
</Table>


     Included in Loans are loans to certain officers, directors, and companies
     in which such officers and directors have 10 percent or more beneficial
     ownership in the aggregate amount of $19,295,000 and $17,451,000 at
     December 31, 2004 and 2003, respectively. In 2004, new loans and other
     additions amounted to $25,605,000, and repayments and other reductions
     amounted to $23,761,000. In Management's judgment, these loans were made on
     substantially the same terms and conditions as those made to other
     borrowers, and do not represent more than the normal risk of collectibility
     or present other unfavorable features.

     Loans carried at $181,412,000 and $182,003,000 at December 31, 2004 and
     2003, respectively, were pledged to secure Federal Home Loan Bank advances.

(5)  ALLOWANCE FOR LOAN LOSSES
     Activity in the allowance for loan losses was as follows (000s omitted):

<Table>
<Caption>
                                2004          2003          2002
                              --------      --------      --------
<S>                           <C>           <C>           <C>
Balance beginning of year     $ 14,500      $ 12,400      $ 13,000
Provision for loan losses        2,491         8,005         6,101
Loans charged off               (4,447)       (6,683)       (8,697)
Recoveries                       1,256           778         1,996
                              --------      --------      --------
Balance end of year           $ 13,800      $ 14,500      $ 12,400
                              ========      ========      ========
</Table>


     Each period the provision for loan losses in the income statement results
     from the combination of an estimate by Management of loan losses that
     occurred during the current period and the ongoing adjustment of prior
     estimates of losses occurring in prior periods.

     To serve as a basis for making this provision, the Bank maintains an
     extensive credit risk monitoring process that considers several factors
     including: current economic conditions affecting the Bank's customers, the
     payment performance of individual loans and pools of homogeneous loans,
     portfolio seasoning, changes in collateral values, and detailed reviews of
     specific loan relationships. For loans deemed to be impaired due to an
     expectation that all contractual payments will probably not be received,
     impairment is measured by comparing the Bank's recorded investment in the
     loan to the present value of expected cash flows discounted at the loan's
     effective interest rate, the fair value of the collateral, or the loan's
     observable market price.

     The provision for loan losses increases the allowance for loan losses, a
     valuation account which appears on the consolidated balance sheets. As the
     specific customer and amount of a loan loss is confirmed by gathering
     additional information, taking collateral in full or partial settlement of
     the loan, bankruptcy of the borrower, etc., the loan is charged off,
     reducing the allowance for loan losses. If, subsequent to a charge off, the
     Bank is able to collect additional amounts from the customer or sell
     collateral worth more than earlier estimated, a recovery is recorded.



                                       29
<PAGE>


(6)  BANK PREMISES AND EQUIPMENT
     Bank premises and equipment as of year end are as follows (000s omitted):

<Table>
<Caption>
                                        2004        2003
                                      -------     -------
<S>                                   <C>         <C>
Land, buildings and improvements      $27,909     $22,725
Equipment, furniture and fixtures      19,688      18,202
                                      -------     -------
Total Bank premises and equipment     $47,597     $40,927
Less accumulated depreciation          25,427      22,903
                                      -------     -------
Bank premises and equipment, net      $22,170     $18,024
                                      =======     =======
</Table>


     The Corporation has entered into lease commitments for office locations.
     Rental expense charged to operations was $311,000, $205,000, and $148,000
     for the years ended December 31, 2004, 2003, and 2002, respectively. The
     future minimum lease payments are as follows:

<Table>
<Caption>
                Minimum
Year            Payment
----------     --------
<S>            <C>
      2005     $227,000
      2006      126,000
      2007      128,000
      2008      126,000
      2009       78,000
Thereafter      228,000
</Table>


(7)  INTEREST RECEIVABLE AND OTHER ASSETS
     The Bank includes the cash surrender value of Bank Owned Life Insurance
     (BOLI) in Interest Receivable and Other Assets on the accompanying
     consolidated balance sheets. The cash surrender value of the BOLI was
     $35,152,000 at December 31, 2004 and $33,780,000 at December 31, 2003. The
     following is a description of the components of the BOLI:

     DIRECTOR SPLIT-DOLLAR LIFE INSURANCE
     On December 21, 2000, the Bank entered into director split-dollar life
     insurance agreements with each of its ten directors. Under the split-dollar
     agreement, the policy's interests are divided between the Bank and the
     director. The Bank owns the cash surrender value, including the accumulated
     policy earnings, with each director's beneficiaries receiving a fixed
     amount that is based on his or her years of director service and the Bank
     receiving the remainder of the death benefits. The directors' death
     benefits are $500,000 for director service of less than 3 years, $600,000
     for service up to 5 years, $750,000 for service up to 10 years, and
     $1,000,000 for director service of 10 years or more. In 2000, the Bank
     fully paid the premiums for these ten policies with one lump sum premium
     payment in the amount of $4,937,000. In 2003, the Bank paid additional
     premiums of $3,661,000 to increase the coverage for each director to an
     amount sufficient to provide the maximum split-dollar benefit that could be
     attained.

     The increase in cash surrender value is recorded as other non-interest
     income. The Bank expects to recover in full the cash value from the Bank's
     portion of the policies' death benefits.

     SALARY CONTINUATION AGREEMENT AND LIFE INSURANCE POLICY
     The Bank entered into a Salary Continuation Agreement with Ronald D.
     LaBeau, then Chairman and Chief Executive Officer of the Bank on December
     27, 2000. This agreement provides that the Bank will pay an annual salary
     continuation benefit of $139,600 to Mr. LaBeau or his designated
     beneficiaries for 10 years after his retirement on or after reaching the
     normal retirement age of 65. On April 2, 2004, Mr. LaBeau retired prior to
     reaching normal retirement age of 65. In accordance with the agreement, he
     is eligible for an annual salary continuation benefit of $57,996 each year
     for ten years, commencing in 2009.

     At the same time it entered into the Salary Continuation Agreement with Mr.
     LaBeau, the Bank purchased an insurance policy on Mr. LaBeau's life, with a
     single premium payment of $5,880,000. While Mr. LaBeau's beneficiaries will
     receive any payments to which he is entitled under the Salary Continuation
     Agreement, they are not eligible for any of the life insurance proceeds of
     this policy.

     The life insurance policy is in addition to the split-dollar insurance
     policy purchased by the Bank on Mr. LaBeau's life for his service as a
     director, discussed previously, and the split-dollar insurance policy
     discussed in "Executive Group Term Carve Out Split-Dollar Life Insurance
     Agreements" below.

     The Bank entered into a Salary Continuation Agreement with H. Douglas
     Chaffin, President and Chief Executive Officer of the Bank on July 1, 2003.
     This agreement provides that the Bank will pay an annual salary
     continuation benefit of 65% of his final annual salary, reduced by 50% of
     his Social Security benefit, his normal pension benefit, and benefits
     payable attributable to the portion of the Bank's Section 401(k) plan
     arising from employer contributions, to Mr. Chaffin or his designated
     beneficiaries for 10 years after his retirement on or after reaching the
     normal retirement age of 65.

                                       30
<PAGE>

     EXECUTIVE GROUP TERM CARVE OUT SPLIT-DOLLAR LIFE INSURANCE AGREEMENTS
     In addition to insurance policies on the lives of the directors of the
     Bank, the Bank owns life insurance on the lives of several executives, for
     which the Bank made premium payments of $16,242,000 in the aggregate. The
     Bank and the executives share rights to death benefits payable under the
     policies. An executive's beneficiaries are entitled to an amount equal to
     two times the executive's current annual salary, less $50,000 if he or she
     dies before retirement, or equal to his or her annual salary at the time of
     termination of employment if he or she dies after retirement. The Bank will
     receive the remainder of the death benefits. The Bank expects to recover in
     full the premium paid by it from the Bank's portion of the policy's death
     benefits or upon the cancellation or purchase of the policies by the
     executives. The executives also have life insurance under the Bank's group
     term life insurance program for all employees, which pays benefits up to
     $50,000 to the executive's beneficiaries if he or she dies while employed
     by the Bank.

(8)  DEPOSITS
     Interest expense on time certificates of deposit of $100,000 or more in the
     year 2004 amounted to $3,970,000, as compared with $3,066,000 in 2003, and
     $3,998,000 in 2002. At December 31, 2004, the balance of time certificates
     of deposit of $100,000 or more was $184,657,000, as compared with
     $115,654,000 at December 31, 2003. The amount of time deposits with a
     remaining term of more than 1 year was $246,802,000 at December 31, 2004
     and $183,060,000 at December 31, 2003. The following table shows the
     scheduled maturities of Certificates of Deposit as of December 31, 2004:

<Table>
<Caption>
                                    $100,000 and
               Under $100,000           over
               --------------     --------------
<S>                       <C>                <C>
      2005     $   90,141,000     $   98,868,000
      2006         35,514,000         10,301,000
      2007         84,819,000         30,880,000
      2008         29,819,000         13,007,000
      2009         10,741,000         20,602,000
Thereafter            120,000         10,999,000
               --------------     --------------
Total          $  251,154,000     $  184,657,000
               ==============     ==============
</Table>


     Time certificates of deposit include $38,811,000 of brokered certificates
     of deposit as of December 31, 2004, and no brokered certificates of deposit
     as of December 31, 2003. The following table shows the scheduled maturities
     of the brokered certificates as of December 31, 2004.

<Table>
<Caption>
                                  $100,000 and
               Under $100,000          over
               --------------     --------------
<S>            <C>                <C>
      2005     $           --     $           --
      2006                  0          5,550,000
      2007                  0          6,030,000
      2008                  0          3,501,000
      2009                  0         12,731,000
Thereafter                  0         10,999,000
               --------------     --------------
Total          $           --     $   38,811,000
               ==============     ==============
</Table>


(9)  FEDERAL HOME LOAN BANK ADVANCES
     As of December 31, 2004 the Bank had fourteen loans from the Federal Home
     Loan Bank of Indianapolis totaling $256,500,000. Five of these advances,
     with balances totaling $130,000,000 carry fixed rates of interest and
     contain a put option that allows the FHLB to require repayment or
     conversion to a variable rate advance each quarter. The average rate on the
     advances is 5.42%, and no principal payments are required until the final
     maturities in 2009 and 2010. If converted by the FHLB, the interest rates
     would float quarterly at rates ranging from 3 month LIBOR to 3 month LIBOR
     plus .02%. One of the advances has a fixed interest rate of 5.08%, matures
     in 2011, and does not contain a put option. The remaining eight advances,
     totaling $123,000,000, are floating rate loans that float quarterly at
     rates ranging from 3 month LIBOR plus 2.06% to 3 month LIBOR plus 2.30%.
     These advances are non-putable and no principal payments are required until
     the final maturities in 2014. As of December 31, 2003, the Bank had ten
     loans from the Federal Home Loan Bank of Indianapolis totaling
     $225,000,000. Five of these advances, with balances totaling $130,000,000
     carried fixed rates of interest and contained a put option that allowed the
     FHLB to require repayment or conversion to a variable rate advance each
     quarter. The average rate on the advances was 5.42%, and no principal
     payments were required until the final maturities in 2009 and 2010. If
     converted by the FHLB, the interest rates would float quarterly at rates
     ranging from 3 month LIBOR to 3 month LIBOR plus .02%. The remaining five
     advances, totaling $95,000,000, were floating rate loans that floated
     quarterly at rates ranging from 3 month LIBOR plus 2.06% to 3 month LIBOR
     plus 2.30%. These advances were non-putable and no principal payments are
     required until the final maturities in 2013.

     The Bank also has repurchase agreements with brokerage firms that are in
     the possession of the underlying securities. The securities are returned to
     the Bank at the maturity of the agreements. As of December 31, 2004 the



                                       31
<PAGE>

     Bank had five repurchase agreements totaling $30,000,000. This includes
     $20,000,000 of fixed rate agreements at rates ranging from 2.14% to 4.05%,
     with $5,000,000 maturing in each year from 2005 to 2008. There is also one
     agreement for $10,000,000 at a rate of 2.57% with a final maturity of 2011
     that contains a put option that can be exercised by the issuer each
     quarter, beginning in December 2005.

(10) RETIREMENT PLANS
     In 2000, the Bank implemented a retirement plan that included both a money
     purchase pension plan, as well as a voluntary profit sharing 401(k) plan
     for all employees who meet certain age and length of service eligibility
     requirements. In 2002, the Bank amended its retirement plan to freeze the
     money purchase plan and retain the 401(k) plan. To ensure that the plan
     meets the Safe Harbor provisions of the applicable sections of the Internal
     Revenue Code, the Bank contributes an amount equal to four percent of the
     employee's base salary to the 401(k) plan for all eligible employees. In
     addition, an employee may contribute from 1 to 75 percent of his or her
     base salary, up to a maximum of $13,000 in 2004. This annual contribution
     limit increases by $1,000 each year until it reaches $15,000 in 2006. The
     Bank matches the employee's elective contribution up to the first six
     percent of the employee's annual base salary. Depending on the Bank's
     profitability, an additional profit sharing contribution may be made by the
     Bank to the 401(k) plan. The total retirement plan expense was $911,000 for
     the year ended December 31, 2004, $1,012,000 for the year ended December
     31, 2003, and $915,000 for the year ended December 31, 2002. This included
     profit sharing contributions of three percent in 2004, two percent in 2003,
     and three percent in 2002.

     The Bank has a postretirement benefit plan that generally provides for the
     continuation of medical benefits for all employees who retire from the Bank
     at age 55 or older, upon meeting certain length of service eligibility
     requirements. The Bank does not fund its postretirement benefit obligation.
     Rather, payments are made as costs are incurred by covered retirees. The
     amount of benefits paid under the postretirement benefit plan was $101,000
     in 2004, $95,000 in 2003, and $84,000 in 2002. The amount of insurance
     premium paid by the Bank for retirees is capped at 200% of the cost of the
     premium as of December 31, 1992.

     A reconciliation of the accumulated postretirement benefit obligation
     ("APBO") to the amounts recorded in the consolidated balance sheets in
     Interest Payable and Other Liabilities at December 31 is as follows (000s
     omitted):

<Table>
<Caption>
                                                                    2004         2003
                                                                   -------      -------
<S>                                                                <C>          <C>
APBO                                                               $ 1,811      $ 2,033
Unrecognized net transition obligation                                (429)        (482)
Unrecognized prior service costs                                       (36)         (40)
Unrecognized net gain                                                 (159)        (164)
                                                                   -------      -------
Liability recorded in the consolidated statements of condition     $ 1,187      $ 1,347
                                                                   =======      =======
</Table>


     The changes recorded in the accumulated postretirement benefit obligation
     were as follows (000s omitted):

<Table>
<Caption>
                               2004         2003
                              -------      -------
<S>                           <C>          <C>
APBO at beginning of year     $ 2,033      $ 1,757
Service cost                       79           69
Interest cost                     123          114
Actuarial loss                   (323)         188
Benefits paid during year        (101)         (95)
                              -------      -------
APBO at end of year           $ 1,811      $ 2,033
                              =======      =======
</Table>


     Components of the Bank's postretirement benefit expense were as follows:

<Table>
<Caption>
                                           2004      2003      2002
                                          -----     -----     -----
<S>                                       <C>       <C>       <C>
Service cost                              $  79     $  69     $  49
Interest cost                               123       114       110
Amortization of transition obligation        54        54        54
Prior service costs                           4         4         4
Amortization of gains                        --        --        (5)
                                          -----     -----     -----
Net postretirement benefit expense        $ 260     $ 241     $ 212
                                          =====     =====     =====
</Table>


     The APBO as of December 31, 2004 and 2003 was calculated using assumed
     discount rates of 5.75% and 6.25%, respectively. Based on the provisions of
     the plan, the Bank's expense is capped at 200% of the 1992 expense, with
     all expenses above the cap incurred by the retiree. The expense reached the
     cap in 2004, and accordingly the impact of an increase in health care costs
     on the APBO was not calculated.

(11) STOCKHOLDERS' EQUITY
     On December 11, 2003, the Corporation repurchased 1,632,475 shares of its
     stock at $18.50 per share in a self tender offer.

     On December 21, 2000, the Corporation's Board of Directors authorized the
     repurchase of up to 2 million shares of MBT Financial Corp. common stock
     during the two-year period beginning January 2, 2001. On December 19,

                                       32
<PAGE>

     2002, the Board of Directors extended the repurchase program until December
     31, 2004. Shares purchased are as follows:

             Shares
          Repurchased        Cost
          -----------     -----------
 2002         592,101     $ 7,908,387
 2003          60,000         807,650
 2004         220,000       3,873,500
          -----------     -----------
Total         872,101     $12,589,537
          ===========     ===========


     On December 23, 2004, the Corporation's Board of Directors authorized the
     repurchase of up to 2 million shares of MBT Financial Corp. common stock
     during the 12 month period ending December 31, 2005.

 (12) DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS
     Certain of the Bank's assets and liabilities are financial instruments that
     have fair values that differ from their carrying values in the accompanying
     consolidated balance sheets. These fair values, along with the methods and
     assumptions used to estimate such fair values, are discussed below. The
     fair values of all financial instruments not discussed below are estimated
     to be equal to their carrying values as of December 31, 2004 and 2003.

     INVESTMENT SECURITIES
     Fair value for the Bank's investment securities was determined using the
     market value at December 31, 2004 and 2003. These Estimated Market Values
     are disclosed in Note 3.

     LOANS, NET AND LOANS HELD FOR SALE
     The fair value of all loans is estimated by discounting the future cash
     flows associated with the loans, using the current rates at which similar
     loans would be made to borrowers with similar credit ratings and for the
     same remaining maturities. The estimated fair value of loans at December
     31, 2004, net of the allowance for loan losses, is $947,167,000, compared
     to the carrying value of $932,081,000. The estimated fair value of loans at
     December 31, 2003, net of the allowance for loan losses, was $865,427,000,
     compared to the carrying value of $849,350,000.

     OTHER TIME DEPOSITS
     The fair value of other time deposits, consisting of fixed maturity
     certificates of deposit, is estimated by discounting the related cash flows
     using the rates currently offered for deposits of similar remaining
     maturities. The estimated fair value of other time deposits at December 31,
     2004 is $443,265,000, compared to the carrying value of $435,614,000. The
     estimated fair value of other time deposits at December 31, 2003 was
     $348,255,000, compared to the carrying value of $337,472,000.

     FHLB ADVANCES AND SECURITIES SOLD UNDER REPURCHASE AGREEMENTS
     A portion of the Federal Home Loan Bank advances in the accompanying
     consolidated balance sheets were written with a put option that allows the
     Federal Home Loan Bank to require repayment or conversion to a variable
     rate advance. The fair value of these putable Federal Home Loan Bank
     advances is estimated using the binomial lattice option pricing method. The
     estimated fair value of putable Federal Home Loan Bank advances at December
     31, 2004 is $140,160,000, compared to the carrying value of $130,000,000.

     The fair value and carrying value of the variable rate advances at December
     31, 2004 is $123,000,000. The estimated fair value of the fixed rate
     Federal Home Loan Bank advance at December 31, 2004 is $3,603,000, compared
     to the carrying value of $3,500,000.

     The estimated fair value of putable Federal Home Loan Bank advances at
     December 31, 2003 was $144,546,000, compared to the carrying value of
     $130,000,000. The fair value and carrying value of the variable rate
     advances at December 31, 2003 was $95,000,000.

     The estimated fair value of the Securities Sold under Repurchase Agreements
     at December 31, 2004 was $29,943,000, compared to the carrying value of
     $30,000,000.

     OFF-BALANCE-SHEET FINANCIAL INSTRUMENTS
     The fair values of commitments to extend credit and standby letters of
     credit and financial guarantees written are estimated using the fees
     currently charged to engage into similar agreements. The fair values of
     these instruments are not significant.

(13)     FEDERAL INCOME TAXES
     Deferred tax assets and liabilities are recognized for future tax
     consequences attributable to differences between the financial statement
     carrying amounts of existing assets and liabilities and their respective
     tax bases. Deferred tax assets and liabilities are measured using the
     enacted tax rates expected to apply to taxable income in the years in which
     those temporary differences are expected to be reversed. The Corporation
     and the Bank file a consolidated Federal income tax return.



                                       33
<PAGE>


     The provision for Federal income taxes consists of the following (000s
omitted):

<Table>
<Caption>
                                                         2004          2003         2002
                                                        -------      -------      -------
<S>                                                     <C>          <C>          <C>
Federal income taxes currently payable (refundable)     $ 8,580      $ 7,348      $ 6,507
Provision (credit) for deferred taxes on:
      Book (over) under tax loan loss provision             245         (639)         210
      Accretion of bond discount                            (43)        (245)         103
      Net deferred loan origination fees                     56          (43)          46
      Accrued postretirement benefits                       (81)           5          (58)
      Tax over (under) book depreciation                   (258)         441           70
                                                        -------      -------      -------
Total deferred provision (credit)                           (81)        (481)         371
      Other, net                                            276         (256)       1,236
                                                        -------      -------      -------
                                                        $ 8,775      $ 6,611      $ 8,114
                                                        =======      =======      =======
</Table>


     The effective tax rate differs from the statutory rate applicable to
     corporations as a result of permanent differences between accounting and
     taxable income as follows:

<Table>
<Caption>
                              2004     2003     2002
                              ----     ----     ----
<S>                           <C>      <C>      <C>
Statutory rate                35.0 %   35.0 %   35.0 %
Municipal interest income     (6.3)    (7.7)    (7.1)
Other, net                    (0.7)    (1.8)    (0.8)
                              ----     ----     ----
Effective tax rate            28.0 %   25.5 %   27.1 %
                              ====     ====     ====
</Table>


     The components of the net deferred Federal income tax asset (included in
     Interest Receivable and Other Assets on the accompanying consolidated
     balance sheets) at December 31 are as follows (000s omitted):

<Table>
<Caption>
                                                                  2004         2003
                                                                 -------      -------
<S>                                                              <C>          <C>
Deferred Federal income tax assets:
      Allowance for loan losses                                  $ 4,734      $ 4,979
      Net deferred loan origination fees                             545          601
      Tax versus book depreciation differences                       474          216
      Net unrealized losses on securities available for sale          58          450
      Accrued postretirement benefits                                552          471
      Other, net                                                     191          467
                                                                 -------      -------
                                                                 $ 6,554      $ 7,184
Deferred Federal income tax liabilities:
      Net unrealized gains on securities available for sale      $    --      $    --
      Accretion of bond discount                                    (299)        (342)
                                                                 -------      -------
                                                                 $  (299)     $  (342)
                                                                 -------      -------
Net deferred Federal income tax asset                            $ 6,255      $ 6,842
                                                                 =======      =======
</Table>

(14) REGULATORY CAPITAL REQUIREMENTS
     The Corporation and the Bank are subject to various regulatory capital
     requirements administered by the Federal 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 the Corporation's consolidated financial
     statements. Under capital adequacy guidelines and the regulatory framework
     for prompt corrective action, the Corporation and the Bank must meet
     specific capital guidelines that involve quantitative measures of assets,
     liabilities, and certain off-balance-sheet items as calculated under
     regulatory accounting practices. The capital amounts and classification are
     also subject to qualitative judgments by the regulators about components,
     risk weightings, and other factors.

     Quantitative measures established by regulation to ensure capital adequacy
     require the Corporation and the Bank to maintain minimum amounts and ratios
     (set forth in the accompanying tables) of Total and Tier I capital to risk
     weighted assets and of Tier I capital to average assets.

     As of December 31, 2004, the Corporation's capital ratios exceeded the
     required minimums to be considered well capitalized under the regulatory
     framework for prompt corrective action. To be categorized as well
     capitalized, the Corporation must maintain minimum Total risk based, Tier I
     risk based, and Tier I leverage ratios as set forth in the tables. There
     are no conditions or events since December 31, 2004 that Management
     believes have changed the Corporation's category. Management believes, as
     of December 31, 2004, that the Corporation meets all capital adequacy
     requirements to which it is subject.




                                       34
<PAGE>


     The Corporation's and Bank's actual capital amounts and ratios are also
     presented in the table (000's omitted in dollar amounts).

<Table>
<Caption>
                                                                       Minimum to Qualify as
                                                        Actual           Well Capitalized
                                                --------------------   --------------------
                                                 Amount        Ratio    Amount        Ratio
                                                --------       -----   --------       -----
<S>                                             <C>            <C>     <C>            <C>
AS OF DECEMBER 31, 2004:
     Total Capital to Risk-Weighted Assets
          Consolidated                          $168,796       15.6%   $108,483       10.0%
          Monroe Bank & Trust                    166,976       15.4%    108,483       10.0%
     Tier 1 Capital to Risk-Weighted Assets
          Consolidated                           155,207       14.3%     65,090        6.0%
          Monroe Bank & Trust                    153,387       14.1%     65,090        6.0%
     Tier 1 Capital to Average Assets
          Consolidated                           155,207       10.0%     77,275        5.0%
          Monroe Bank & Trust                    153,387        9.9%     77,275        5.0%
</Table>

<Table>
<Caption>
                                                                       Minimum to Qualify as
                                                        Actual            Well Capitalized
                                                --------------------   ---------------------
                                                 Amount        Ratio    Amount        Ratio
                                                --------       -----   --------       ------
<S>                                             <C>            <C>     <C>            <C>
AS OF DECEMBER 31, 2003:
     Total Capital to Risk-Weighted Assets
          Consolidated                          $156,520       15.7%   $ 99,873       10.0%
          Monroe Bank & Trust                    156,146       15.6%     99,873       10.0%
     Tier 1 Capital to Risk-Weighted Assets
          Consolidated                           143,980       14.4%     59,924        6.0%
          Monroe Bank & Trust                    143,606       14.4%     59,924        6.0%
     Tier 1 Capital to Average Assets
          Consolidated                           143,980        9.8%     73,767        5.0%
          Monroe Bank & Trust                    143,606        9.7%     73,767        5.0%
</Table>


(15) EARNINGS PER SHARE
     The calculation of earnings per common share for the years ended December
     31 is as follows:

<Table>
<Caption>
                                                     2004              2003             2002
                                                   -----------     -----------     -----------
<S>                                                <C>             <C>              <c>
BASIC
         Net income                                $22,599,000     $19,315,000$     21,804,000
         Less preferred dividends                           --              --              --
                                                   -----------     -----------     -----------
         Net income applicable to common stock     $22,599,000     $19,315,000     $21,804,000
                                                   -----------     -----------     -----------
         Average common shares outstanding          17,444,165      19,026,369      19,458,737
                                                   -----------     -----------     -----------
         Earnings per common share - basic         $      1.30     $      1.02     $      1.12
                                                   ===========     ===========     ===========
</Table>

<Table>
<Caption>
                                                            2004            2003             2002
                                                         -----------     -----------     -----------
<S>                                                      <C>             <C>             <C>
DILUTED
         Net income                                      $22,599,000     $19,315,000     $21,804,000
         Less preferred dividends                                 --              --              --
                                                         -----------     -----------     -----------
         Net income applicable to common stock           $22,599,000     $19,315,000     $21,804,000
                                                         -----------     -----------     -----------
         Average common shares outstanding                17,444,165      19,026,369      19,458,737
         Stock option adjustment                              83,500          46,260             933
                                                         -----------     -----------     -----------
         Average common shares outstanding - diluted      17,527,665      19,072,629      19,459,670
                                                         -----------     -----------     -----------
         Earnings per common share - diluted             $      1.29     $      1.01     $      1.12
                                                         ===========     ===========     ===========
</Table>

 (16) STOCK-BASED COMPENSATION PLAN
     The Long-Term Incentive Compensation Plan approved by shareholders at the
     April 6, 2000 Annual Meeting of Shareholders of Monroe Bank & Trust
     authorized the Board of Directors to grant nonqualified stock options to
     key employees and non-employee directors. Such grants may be made until
     January 2, 2010 for up to 1,000,000 shares of the Corporation's common
     stock. The amount that may be awarded to any one individual is limited to
     100,000 shares in any one calendar year.

     Stock options granted under the plan have exercise prices equal to the fair
     market value at the date of grant. Options granted under the plan may be
     exercised for a period of no more than ten years from the date of grant.
     One-third of the options granted to key employees in 2004 and 2003 vest
     annually, beginning December 31, 2004, and December 31, 2003, respectively.
     The options granted to key employees in 2002 and 2000 are vested as of
     December 31, 2004 and December 31, 2002, respectively. The options granted
     to non-employee directors in 2002 and 2001 vested on December 31, 2002 and
     December 31, 2001, respectively.




                                       35
<PAGE>


     A summary of the status of stock options under the plan is presented in the
table below.




<Table>
<Caption>
                                             2004                  2003                2002
                                     ---------------------  ---------------------  -----------------
                                                  Weighted              Weighted            Weighted
                                                  Average               Average             Average
                                                  Exercise              Exercise            Exercise
                                      Shares       Price     Shares      Price      Shares   Price
                                     -------     ---------  -------     ---------  -------  --------
<S>                                  <C>         <C>        <C>         <C>        <C>      <C>
Options Outstanding, January 1       480,802     $   14.73  323,949     $   15.52  140,434    $17.71
Granted                              161,000         16.69  179,500         13.20  183,515     13.85
Exercised                            183,915         14.97   19,647         13.86       --        --
Forfeited/Expired                     24,100         17.33       --            --       --        --
Cancelled                                 --            --    3,000         13.85       --        --
                                     -------     ---------  -------     ---------  -------    ------
Options Outstanding, December 31     433,787     $   15.22  480,802     $   14.73  323,949    $15.52
                                     =======     =========  =======     =========  =======    ======
Options Exercisable, December 31     266,637     $   15.08  306,445     $   15.49  212,615    $16.40
                                     =======     =========  =======     =========  =======    ======
Weighted Average Fair Value of
   Options Granted During Year                   $    3.84              $    3.04             $ 3.19
</Table>


     The options outstanding as of December 31, 2004 are exercisable at prices
     ranging from $13.20 to $18.125. The options exercisable as of December 31,
     2004 are exercisable at prices ranging from $13.20 to $18.125.


(17) PARENT COMPANY
     Condensed parent company financial statements, which include transactions
     with the subsidiary, are as follows (000s omitted):


     BALANCE SHEETS

<Table>
<Caption>
                                                         DECEMBER 31,
                                                      2004        2003
                                                    --------     --------
<S>                                                 <C>          <C>
ASSETS
Cash and due from banks                             $  3,994     $  2,745
Investment in subsidiary bank                        153,524      143,071
                                                    --------     --------
     Total assets                                   $157,518     $145,816
                                                    ========     ========
LIABILITIES
Dividends payable and other liabilities             $  2,172     $  2,370
                                                    --------     --------
     Total liabilities                                 2,172        2,370
                                                    ========     ========
STOCKHOLDERS' EQUITY
     Total stockholders' equity                      155,346      143,446
                                                    --------     --------
     Total liabilities and stockholders' equity     $157,518     $145,816
                                                    ========     ========
</Table>

STATEMENTS OF INCOME

<Table>
<Caption>
                                                         YEARS ENDED DECEMBER 31,
                                                     2004          2003          2002
                                                   --------      --------      --------
<S>                                                <C>           <C>           <C>
 INCOME
 Dividends from subsidiary bank                    $ 12,829      $ 42,061      $ 18,357
                                                   --------      --------      --------
        Total income                                 12,829        42,061        18,357
                                                   --------      --------      --------
 EXPENSE
 Interest on other borrowed funds                        --            --            --
 Other expense                                          176           399            98
                                                   --------      --------      --------
        Total expense                                   176           399            98
                                                   --------      --------      --------

 Income before tax and equity in undistributed
      net income of subsidiary bank                  12,653        41,662        18,259
 Income tax benefit                                     (51)         (102)          (34)
                                                   --------      --------      --------
 Income before equity in undistributed
      net income of subsidiary bank                  12,704        41,764        18,293
 Equity in undistributed net income (loss)
      of subsidiary bank                              9,895       (22,449)        3,511
                                                   --------      --------      --------
 NET INCOME                                        $ 22,599      $ 19,315      $ 21,804
                                                   ========      ========      ========
</Table>







                                       36

<PAGE>



     STATEMENTS OF CASH FLOWS


<Table>
<Caption>
                                                                       YEARS ENDED DECEMBER 31,
                                                                   2004          2003          2002
                                                                 --------      --------      --------
<S>                                                              <C>           <C>           <C>
CASH FLOWS PROVIDED BY (USED FOR)
OPERATING ACTIVITIES:
Net income                                                       $ 22,599      $ 19,315      $ 21,804
Equity in undistributed net income (loss) of subsidiary bank       (9,895)       22,449        (3,511)
Net increase (decrease) in other liabilities                         (197)         (164)           80
Net decrease in other assets                                          325            --            --
                                                                 --------      --------      --------
     Net cash provided by operating activities                   $ 12,832      $ 41,600      $ 18,373
                                                                 --------      --------      --------

CASH FLOWS PROVIDED BY (USED FOR)
FINANCING ACTIVITIES:
Issuance of common stock                                         $  2,940      $    342      $     --
Repurchase of common stock                                         (3,874)      (31,008)       (7,908)
Dividends paid                                                    (10,649)      (10,904)      (10,349)
                                                                 --------      --------      --------
     Net cash used for financing activities                      $(11,583)     $(41,570)     $(18,257)
                                                                 --------      --------      --------

NET INCREASE IN CASH
  AND CASH EQUIVALENTS                                           $  1,249      $     30      $    116
CASH AND CASH EQUIVALENTS
  AT BEGINNING OF YEAR                                              2,745         2,715         2,599
                                                                 --------      --------      --------
CASH AND CASH EQUIVALENTS AT END OF YEAR                         $  3,994      $  2,745      $  2,715
                                                                 ========      ========      ========
</Table>

     Under current regulations, the Bank is limited in the amount it may loan to
     the Corporation. Loans to the Corporation may not exceed ten percent of the
     Bank's capital stock, surplus, and undivided profits plus the allowance for
     loan losses. Loans from the Bank to the Corporation are required to be
     collateralized. Accordingly, at December 31, 2004, Bank funds available for
     loans to the Corporation amounted to $16,743,000. The Bank has not made any
     loans to the Corporation.

 (18) FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK
     The Bank is a party to financial instruments with off-balance sheet risk in
     the normal course of business to meet the financing needs of its customers.
     These financial instruments include commitments to extend credit and
     standby letters of credit. Those instruments involve, to varying degrees,
     elements of credit and interest rate risk in excess of the amount
     recognized in the consolidated balance sheets.

     The Bank's exposure to credit loss in the event of nonperformance by the
     other party to the financial instrument for commitments to extend credit
     and standby letters of credit is represented by the contractual amount of
     those instruments. The Bank uses the same credit policies in making
     commitments and conditional obligations as it does for its other lending
     activities.

     Financial instruments whose contractual amounts represent off-balance sheet
     credit risk at December 31 were as follows (000s omitted):

<Table>
<Caption>
                                                                 CONTRACTUAL AMOUNT
                                                                2004          2003
                                                               --------     --------
<S>                                                            <C>          <C>
Commitments to extend credit:
      Unused portion of commercial lines of credit             $123,739     $118,339
      Unused portion of credit card lines of credit               7,265        9,828
      Unused portion of home equity lines of credit              23,709       16,907
Standby letters of credit and financial guarantees written       16,449       18,764
</Table>


     Commitments to extend credit are agreements to lend to a customer as long
     as there is no violation of any condition established in the contract. Most
     commercial lines of credit are secured by real estate mortgages or other
     collateral, generally have fixed expiration dates or other termination
     clauses, and require payment of a fee. Since the lines of credit may expire
     without being drawn upon, the total committed amounts do not necessarily
     represent future cash requirements. Credit card lines of credit have
     various established expiration dates, but are fundable on demand. Home
     equity lines of credit are secured by real estate mortgages, a majority of
     which have ten year expiration dates, but are fundable on demand. The Bank
     evaluates each customer's creditworthiness on a case by case basis. The
     amount of the collateral obtained, if deemed necessary by the Bank upon
     extension of credit, is based on Management's credit evaluation of the
     counter party.




                                       37
<PAGE>


     Standby letters of credit written are conditional commitments issued by the
     Bank to guarantee the performance of a customer to a third party. Those
     guarantees are primarily issued to support public and private borrowing
     arrangements and other business transactions. Approximately $15,484,000 of
     the letters of credit expires in 2005 and $965,000 extends for two to five
     years. The credit risk involved in issuing letters of credit is essentially
     the same as that involved in extending loan facilities to customers.

(19) QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (000S OMITTED):

<Table>
<Caption>
2004                                          FIRST      SECOND       THIRD      FOURTH
----------------------------------------     -------     -------     -------     -------
<S>                                          <C>         <C>         <C>         <C>
Total Interest Income                        $18,560     $19,250     $20,744     $21,149
Total Interest Expense                         5,920       6,266       7,117       7,695
                                             -------     -------     -------     -------
Net Interest Income                           12,640      12,984      13,627      13,454
Provision for Loan Losses                        600         600         600         691
Other Income                                   3,226       3,361       3,396       3,793
Other Expenses                                 7,889       7,995       8,025       8,707
                                             -------     -------     -------     -------
Income Before Provision For Income Taxes       7,377       7,750       8,398       7,849
Provision For Income Taxes                     1,977       2,102       2,289       2,407
                                             -------     -------     -------     -------
Net Income                                   $ 5,400     $ 5,648     $ 6,109     $ 5,442
                                             =======     =======     =======     =======
Basic Earnings Per Common Share              $  0.31     $  0.32     $  0.35     $  0.32
Diluted Earnings Per Common Share            $  0.31     $  0.32     $  0.35     $  0.31
Dividends Declared Per Share                 $  0.15     $  0.15     $  0.16     $  0.16
</Table>

<Table>
<Caption>
2003                                          FIRST      SECOND       THIRD      FOURTH
----------------------------------------     -------     -------     -------     -------
<S>                                          <C>         <C>         <C>         <C>
Total Interest Income                        $19,559     $20,020     $19,299     $18,896
Total Interest Expense                         7,555       7,118       6,524       6,270
                                             -------     -------     -------     -------
Net Interest Income                           12,004      12,902      12,775      12,626
Provision for Loan Losses                        825         825       6,325          30
Other Income                                   3,203       3,516       3,882       3,202
Other Expenses                                 7,374       7,582       7,680       7,543
                                             -------     -------     -------     -------
Income Before Provision For Income Taxes       7,008       8,011       2,652       8,255
Provision For Income Taxes                     1,951       2,230         679       1,751
                                             -------     -------     -------     -------
Net Income                                   $ 5,057     $ 5,781     $ 1,973     $ 6,504
                                             =======     =======     =======     =======
Basic Earnings Per Common Share              $  0.26     $  0.30     $  0.10     $  0.36
Diluted Earnings Per Common Share            $  0.26     $  0.30     $  0.10     $  0.35
Dividends Declared Per Share                 $  0.14     $  0.14     $  0.15     $  0.15
</Table>





                                       38
<PAGE>


ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

None

ITEM 9A. CONTROLS AND PROCEDURES

CONCLUSION REGARDING THE EFFECTIVENESS OF DISCLOSURE CONTROLS AND PROCEDURES
MBT Financial Corp. carried out an evaluation, under the supervision and with
the participation of its management, including its Chief Executive Officer and
Chief Financial Officer, of the effectiveness of the design and operation of the
Corporation's disclosure controls and procedures as of December 31, 2004,
pursuant to Exchange Act Rule 13a-15. Based upon that evaluation, the Chief
Executive Officer and Chief Financial Officer concluded that the Corporation's
disclosure controls and procedures were effective as of December 31, 2004, in
timely alerting them to material information relating to the Corporation
(including its consolidated subsidiaries) required to be in the Corporation's
periodic SEC filings.

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
The management of MBT Financial Corp. is responsible for establishing and
maintaining adequate internal control over financial reporting. MBT Financial
Corp.'s internal control over financial reporting is a process designed under
the supervision of the Corporation's Chief Executive Officer and Chief Financial
Officer to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of the Corporation's financial statements for
external reporting purposes in accordance with U.S. generally accepted
accounting principles.

MBT Financial Corp.'s management assessed the effectiveness of the Corporation's
internal control over financial reporting as of December 31, 2004 based on
criteria set forth by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO) in "Internal Control-Integrated Framework." Based on that
assessment, management determined that, as of December 31, 2004, the
Corporation's internal control over financial reporting is effective, based on
those criteria. Management's assessment of the effectiveness of the
Corporation's internal control over financial reporting as of December 31, 2004
has been audited by Plante & Moran, PLLC, an independent registered public
accounting firm, as stated in their report appearing on page 40.


ITEM 9B. OTHER INFORMATION

None.





                                       39
<PAGE>


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
MBT Financial Corp. and Subsidiaries
Monroe, Michigan

We have audited management's assessment included in the accompanying Report of
Management on MBT Financial Corp. and Subsidiaries Internal Control Over
Financial Reporting, that the Company maintained effective internal control over
financial reporting as of December 31, 2004, based on criteria established in
Internal Control-Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Management is responsible for
maintaining effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial reporting.
Our responsibility is to express an opinion on management's assessment and an
opinion on the effectiveness of the company's internal control over financial
reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control over
financial reporting, evaluating management's assessment, testing and evaluating
the design and operating effectiveness of internal control, and performing such
other procedures as we considered necessary in the circumstances. We believe
that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles. A company's internal control over
financial reporting includes those policies and procedures that (1) pertain to
the maintenance of records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of the assets of the company; (2)
provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditures of the company are
being made only in accordance with authorizations of management and directors of
the company; and (3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use, or disposition of the company's
assets that could have a material effect on the financial statements.

Because of inherent limitations, internal control over financial reporting may
not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.

In our opinion, management's assessment that MBT Financial Corp. and
Subsidiaries maintained effective internal control over financial reporting as
of December 31, 2004, is fairly stated, in all material respects, based on COSO
criteria. Also in our opinion, MBT Financial Corp. and Subsidiaries maintained,
in all material respects, effective internal control over financial reporting as
of December 31, 2004 based on the COSO criteria.

We have also audited, in accordance with the standards of the Public Company
Accounting Oversight Board (United States), the Consolidated Balance Sheets of
MBT Financial Corp. and Subsidiaries as of December 31, 2004 and 2003 and the
related consolidated statements of earnings, shareholders equity and cash flow
for each of the three years in the period ended December 31, 2004 and our report
dated February 28, 2005, expressed an unqualified opinion thereon.


/s/ Plante & Moran, PLLC
February 28, 2005
Auburn Hills, Michigan


                                       40
<PAGE>



                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

(A)  EXECUTIVE OFFICERS - See "Executive Officers" in part I, Item 1 hereof.

(B)  DIRECTORS AND EXECUTIVE OFFICERS - information required by this item is
     incorporated by reference from the sections entitled "Election of
     Directors" and "Section 16(a) Beneficial Ownership Reporting Compliance" in
     the Proxy Statement for the Annual Meeting of Shareholders that is to be
     filed with the Securities Exchange Commission.

(C)  AUDIT COMMITTEE FINANCIAL EXPERT - The Board of Directors has determined
     that Peter H. Carlton, member of the Audit Committee, is an "audit
     committee financial expert" and "independent" as defined under applicable
     SEC and Nasdaq rules.

(D)  MBT Financial Corp. has adopted its CODE OF ETHICS, a code of ethics that
     applies to all its directors, officers, and employees, including its Chief
     Executive Officer, Chief Financial Officer, and internal auditor. A copy of
     the Code of Ethics is posted on our website at http://www.mbandt.com. In
     the event we make any amendment to, or grant any waiver of, a provision of
     the Code of Ethics that applies to the principal executive officers,
     principal financial officer, principal accounting officer, or controller,
     or persons performing similar functions that require disclosure under
     applicable SEC rules, we intend to disclose such amendment or waiver, the
     reasons for it, and the nature of any waiver, the name of the person to
     whom it was granted, and the date, on our internet website.

ITEM 11. EXECUTIVE COMPENSATION

Information required by this item is incorporated by reference from the sections
entitled "Executive Compensation and Other Information" and "Compensation
Committee Interlocks and Insider Participation in Compensation Decisions" in the
Proxy Statement for the Annual Meeting of Shareholders that is to be filed with
the Securities and Exchange Commission.


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS

Information required by this item is incorporated by reference from the section
entitled "Ownership of Voting Shares" in the Proxy Statement for the Annual
Meeting of Shareholders that is to be filed with the Securities and Exchange
Commission.

Securities authorized for issuance under equity compensation plans as of
December 31, 2004 were as follows:

<Table>
<Caption>
                                                                                                    Number of securities remaining
                                       Number of securities to be        Weighted average      available for future issuance under
                                        issued upon exercise of         exercise price of           equity compensation plans
                                     outstanding options, warrants,     outstanding options,    (excluding securities reflected in
                                             and rights                warrants, and rights                 first column )
                                     ------------------------------   -----------------------   -----------------------------------
<S>                                  <C>                              <C>                       <C>
Equity Compensation plans approved
  by security holders                                       433,787   $                 15.22                               331,045
Equity Compensation plans not
  approved by security holders                                    0                         0                                     0
                                     ------------------------------   -----------------------   -----------------------------------
Total                                                       433,787   $                 15.22                               331,045
                                     ==============================   =======================   ===================================
</Table>









                                       41
<PAGE>


ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Information required by this item is incorporated by reference from the section
entitled "Certain Transactions" in the Proxy Statement for the Annual Meeting of
Shareholders that is to be filed with the Securities and Exchange Commission.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

Information required by this item is incorporated by reference from the section
entitled "Principal Accounting Firm Fees" in the Proxy Statement for the Annual
Meeting of Shareholders that is to be filed with the Securities and Exchange
Commission.







                                       42
<PAGE>


                                     PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

                                    Contents
Financial Statements

         Reports of Independent Registered Public Accounting Firm - Page 19

         Consolidated Balance Sheets as of December 31, 2004 and 2003 - Page 20

         Consolidated Statements of Income for the Years Ended December 31,
                  2004, 2003, and 2002 - Page 21
         Consolidated Statements of Changes in Stockholders' Equity for the
                  Years Ended December 31, 2004, 2003, and 2002 - Page 22
         Consolidated Statements of Cash Flows for the Years Ended December 31,
                  2004, 2003, and 2002- Page 23
         Notes to Consolidated Financial Statements - Pages 24 - 38


                                    Exhibits

The following exhibits are filed as a part of this report:

3.1      Restated Articles of Incorporation of MBT Financial Corp. Previously
         filed as Exhibit 3.1 to MBT Financial Corp.'s Form 10-K for its fiscal
         year ended December 31, 2000.

3.2      Bylaws of MBT Financial Corp.

10.1     MBT Financial Corp. Long-Term Incentive Compensation Plan. Previously
         filed as Exhibit 10.1 to MBT Financial Corp.'s Form 10-K for its fiscal
         year ended December 31, 2000.

10.2     Monroe Bank & Trust Salary Continuation Agreement with Ronald D.
         LaBeau. Previously filed as Exhibit 10.2 to MBT Financial Corp.'s Form
         10-K for its fiscal year ended December 31, 2000.

10.3     Monroe Bank & Trust Split Dollar Life Insurance Agreement with
         Directors. Previously filed as Exhibit 10.3 to MBT Financial Corp.'s
         Form 10-K for its fiscal year ended December 31, 2000.

10.4     Monroe Bank & Trust Group Term Carve Out Plan Providing Life Insurance
         Benefits to Executive Officers. Previously filed as Exhibit 10.4 to MBT
         Financial Corp.'s Form 10-K for its fiscal year ended December 31,
         2000.

10.5     MBT Financial Corp. Employment Agreement with H. Douglas Chaffin.
         Previously filed as Exhibit 10.5 to MBT Financial Corp.'s Form 10-Q for
         its fiscal quarter ended September 30, 2001.

10.6     Monroe Bank & Trust Group Term Carve Out Plan Providing Life Insurance
         Benefits to Executive Officers. Previously filed as Exhibit 10.6 to MBT
         Financial Corp.'s Form 10-K for its fiscal year ended December 31,
         2001.

10.7     Monroe Bank & Trust Supplemental Executive Retirement Agreement with H.
         Douglas Chaffin. Previously filed as Exhibit 10.1 to MBT Financial
         Corp.'s Form 10-Q for its fiscal quarter ended September 30, 2003.

10.8     Monroe Bank & Trust Split Dollar Agreement with H. Douglas Chaffin.
         Previously filed as Exhibit 10.2 to MBT Financial Corp.'s Form 10-Q for
         its fiscal quarter ended September 30, 2003.

21       Subsidiaries of the Registrant. Previously filed as Exhibit 21 to MBT
         Financial Corp.'s Form 10-K for its fiscal year ended December 31,
         2000.

23       Consent of Independent Auditors

31.1     Certification by Chief Executive Officer required by Securities and
         Exchange Commission Rule 13a-14.

31.2     Certification by Chief Financial Officer required by Securities and
         Exchange Commission Rule 13a-14.

32.1     Certification by Chief Executive Officer pursuant to 18 U.S.C. Section
         1350, as enacted pursuant to Section 906 of the Sarbanes-Oxley Act of
         2002.

32.1     Certification by Chief Financial Officer pursuant to 18 U.S.C. Section
         1350, as enacted pursuant to Section 906 of the Sarbanes-Oxley Act of
         2002.



                                       43
<PAGE>



                                   Signatures



Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

Dated: March 14, 2005                         MBT FINANCIAL CORP.





                                              By:      /s/ John L. Skibski
                                                       John L. Skibski
                                                       Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the date indicated.

Dated: March 14, 2005


By:      /s/ H. Douglas Chaffin               By:      /s/ John L. Skibski
         H. Douglas Chaffin                            John L. Skibski
         President, Chief Executive                    Chief Financial Officer
         Officer & Director



By:      /s/ William D. McIntyre, Jr.         By:      /s/ Richard A. Sieb
         William D. McIntyre, Jr.                      Richard A. Sieb
         Chairman                                      Director


By:      /s/ Peter H. Carlton                 By:      /s/ Philip P. Swy
         Peter H. Carlton                              Philip P. Swy
         Director                                      Director


By:      /s/ Michael J. Miller
         Michael J. Miller
         Director




                                       44
<PAGE>


                                  EXHIBIT INDEX

Exhibit Number           Description of Exhibits
--------------           -----------------------

3.1               Restated Articles of Incorporation of MBT Financial Corp.
                  Previously filed as Exhibit 3.1 to MBT Financial Corp.'s Form
                  10-K for its fiscal year ended December 31, 2000.

3.2               Bylaws of MBT Financial Corp.

10.1              MBT Financial Corp. Long-Term Incentive Compensation Plan.
                  Previously filed as Exhibit 10.1 to MBT Financial Corp.'s Form
                  10-K for its fiscal year ended December 31, 2000.

10.2              Monroe Bank & Trust Salary Continuation Agreement. Previously
                  filed as Exhibit 10.2 to MBT Financial Corp.'s Form 10-K for
                  its fiscal year ended December 31, 2000.

10.3              Monroe Bank & Trust Split Dollar Life Insurance Agreement.
                  Previously filed as Exhibit 10.3 to MBT Financial Corp.'s Form
                  10-K for its fiscal year ended December 31, 2000.

10.4              Monroe Bank & Trust Group Term Carve Out Plan. Previously
                  filed as Exhibit 10.4 to MBT Financial Corp.'s Form 10-K for
                  its fiscal year ended December 31, 2000.

10.5              MBT Financial Corp. Employment Agreement. Previously filed as
                  Exhibit 10.5 to MBT Financial Corp.'s Form 10-Q for its fiscal
                  quarter ended September 30, 2001.

10.6              Monroe Bank & Trust Group Term Carve Out Plan. Previously
                  filed as Exhibit 10.6 to MBT Financial Corp.'s Form 10-K for
                  its fiscal year ended December 31, 2001.

10.7              Monroe Bank & Trust Supplemental Executive Retirement
                  Agreement. Previously filed as Exhibit 10.1 to MBT Financial
                  Corp.'s Form 10-Q for its fiscal quarter ended September 30,
                  2003.

10.8              Monroe Bank & Trust Split Dollar Agreement. Previously filed
                  as Exhibit 10.2 to MBT Financial Corp.'s Form 10-Q for its
                  fiscal quarter ended September 30, 2003.

21                Subsidiaries of the Registrant. Previously filed as Exhibit 21
                  to MBT Financial Corp.'s Form 10-K for its fiscal year ended
                  December 31, 2000.

23                Consent of Independent Auditors

31.1              Certification by Chief Executive Officer required by
                  Securities and Exchange Commission Rule 13a-14.

31.2              Certification by Chief Financial Officer required by
                  Securities and Exchange Commission Rule 13a-14.

32.1              Certification by Chief Executive Officer pursuant to 18 U.S.C.
                  Section 1350, as enacted pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002.

32.2              Certification by Chief Financial Officer pursuant to 18 U.S.C.
                  Section 1350, as enacted pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002.



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