[ L O G O ]




                           HIGH COUNTRY BANCORP, INC.


                                ANNUAL REPORT FOR

                                 THE YEAR ENDED

                                  JUNE 30, 2002
<PAGE>


                     [HIGH COUNTRY BANCORP, INC. LETTERHEAD]





TO OUR STOCKHOLDERS:

     Management  and the Board of Directors of High  Country  Bancorp,  Inc. are
pleased to present this Annual report to the Stockholders. We thank you for your
support during the successful completion of another year.

     During fiscal 2002,  assets increased from $161.3 million to 176.6 million.
This growth was a result of loan demand in the local economy, which continues to
be solid.  We  continue  to  diversify  our  operations  in order to expand  our
customer  base. As a result,  net income  increased  31.4% from $1.27 million to
$1.67 million or $1.85 per share.  Book value per share increased from $16.09 to
$17.82.

     The Board of Directors  has  continued to work  diligently  to establish an
operations  infrastructure to manage the diversity of our balance sheet and meet
the  challenges  of the economy.  We continue to retain  qualified  employees to
maintain  the current  level of business  and  prepare for  anticipated  growth.
Overall,  asset quality remains good despite a declining  national economy and a
local  economy  that has  suffered by a reduction  of tourism as a result of the
forest fires and drought conditions.

     We continue to  repurchase  stock when  available.  The Board of  Directors
believes  our stock is  undervalued.  Our  Secondary  Mortgage  Loan  Department
processed  record  levels of loans  during the past year.  The  Commercial  Loan
Department and the Consumer Loan Department are successfully increasing volumes.
The Operations Department has succeeded in growing core deposits.  Additionally,
branch offices in Salida,  Leadville, and Buena Vista have shown good growth. We
continue to study expansion alternatives.

     Our 116  years  of  service  and  sound  financial  condition  allow  us to
contribute to growth within our  communities.  We continue our commitment to our
local customers.

     We appreciate your support and invite you to review this Financial  Report.
We look forward to meeting the challenges of the financial services industry.


/s/ Larry D. Smith

Larry D. Smith, President and
  Chief Executive Officer

<PAGE>

                              FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
                                                                 AT JUNE 30,                  CHANGE
                                                          -------------------------    ---------------------
                                                            2002             2001       AMOUNT       PERCENT
                                                          --------        ---------    --------      -------
                                                                              (DOLLARS IN THOUSANDS)
<S>                                                       <C>           <C>           <C>              <C>
FINANCIAL POSITION:
  Total assets.........................................   $ 176,585     $   161,331   $   15,254       9.46%
  Loans receivable, net................................     143,837         136,834        7,003       5.12
  Mortgage-backed and related securities...............      10,610           2,221        8,389     377.71
  Investment securities................................       2,422           2,422           --         --
  Deposits.............................................     116,142          98,517       17,625      17.89
  Stockholders' equity.................................      16,131          16,559         (428)     (2.58)
  Number of common shares outstanding..................     905,409       1,028,992     (123,583)    (12.01)

</TABLE>
<TABLE>
<CAPTION>
                                                             FOR THE YEAR ENDED
                                                                  JUNE 30,                    CHANGE
                                                          -----------------------      -----------------------
                                                             2002          2001         AMOUNT        PERCENT
                                                          ---------     ---------      -----------------------
                                                                                (DOLLARS IN THOUSANDS)
<S>                                                       <C>           <C>           <C>               <C>
RESULTS OF OPERATIONS:
  Interest income......................................   $  12,756     $  12,331     $    425          3.45%
  Interest expense.....................................       6,068         6,333         (265)        (4.18)
  Net interest income..................................       6,688         5,998          690         11.50
  Provision for loan losses............................         236           385         (149)       (38.70)
  Net interest income after provision
    for loan losses....................................       6,452         5,613          839         14.95
  Non-interest income..................................       1,863         1,225          638         34.25
  Non-interest expense.................................       5,617         4,756          861         18.10
  Net earnings.........................................       1,671         1,272          399         31.37
</TABLE>


                                       2
<PAGE>
                 SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA


SELECTED FINANCIAL CONDITION DATA:
<TABLE>
<CAPTION>
                                                                          AT JUNE 30,
                                                -----------------------------------------------------------
                                                   2002         2001         2000         1999        1998
                                                --------     --------     --------     --------    --------
                                                                         (DOLLARS IN THOUSANDS)
<S>                                             <C>          <C>          <C>          <C>         <C>
Total assets.................................   $176,585     $161,331     $137,735     $114,014    $100,589
Cash.........................................      2,874        2,760        4,393        2,249       2,999
Interest-earning deposits....................      8,590        9,176        1,321        4,410       6,963
Securities available for sale................         --           --           --           --          --
Securities  held to maturity.................     10,610        2,221        2,843        3,639       4,637
Loans receivable, net........................    143,837      136,834      119,898       98,433      81,359
Savings deposits.............................    116,142       98,517       82,770       72,604      63,425
Stockholders' equity.........................     16,131       16,559       16,108       18,028      18,279
______________________________________________

Number of:
    Real estate loans outstanding............      1,179        1,285        1,282        1,231       1,185
    Savings accounts.........................     14,049       13,235       11,839       11,064      10,199
    Full-service offices.....................          4            4            4            3           3
</TABLE>

SELECTED OPERATIONS DATA:
<TABLE>
<CAPTION>
                                                                      YEAR ENDED JUNE 30,
                                                -------------------------------------------------------------
                                                 2002          2001          2000          1999         1998
                                                -------       -------       --------     --------    --------
                                                                           (IN THOUSANDS)
<S>                                             <C>           <C>           <C>          <C>         <C>
Interest income..............................   $12,756       $ 12,331      $ 9,536      $  8,536    $  7,033
Interest expense.............................     6,068          6,333        4,499         3,920       3,266
                                                -------       --------      -------      --------    --------
    Net interest income......................     6,688          5,998        5,037         4,616       3,767
Provision for loan losses....................       236            385          210           230         219
                                                -------       --------      -------      --------    --------
    Net interest income after provision
      for loan losses........................     6,452          5,613        4,827         4,386       3,548
                                                -------       --------      -------      --------    --------
Noninterest income...........................     1,863          1,225          590           189         158
                                                -------       --------      -------      --------    --------
    Subtotal.................................     8,315          6,838        5,417         4,575       3,706
                                                -------       --------      -------      --------    --------

Noninterest expense:
  Compensation and benefits..................     3,379          2,742        2,216         1,866       1,506
  Other......................................     2,238          2,014        1,536         1,362       1,119
                                                -------       --------      -------      --------    --------
    Total noninterest expense................     5,617          4,756        3,752         3,228       2,625
                                                -------       --------      -------      --------    --------
Income before taxes..........................     2,698          2,082        1,665         1,347       1,081
Income tax expense...........................     1,027            810          619           507         428
                                                -------       --------      -------      --------    --------
    Net income...............................   $ 1,671       $  1,272      $ 1,046      $    840    $    653
                                                =======       ========      =======      ========    ========

</TABLE>

                                       3
<PAGE>
OPERATING RATIOS
----------------
<TABLE>
<CAPTION>
                                                                           AT OR FOR THE YEAR
                                                                              ENDED JUNE 30,
                                                                          ---------------------
                                                                            2002         2001
                                                                          -------      --------
<S>                                                                         <C>          <C>
PERFORMANCE RATIOS:

Return on assets (ratio of net earnings
  to average total assets).............................................     0.99%        0.84%

Return on equity (ratio of net earnings to average equity).............    10.54         7.77

Ratio of average interest-earning assets to
  average interest-bearing liabilities.................................   110.31       112.09

Ratio of net interest income, after provision
  for loan losses, to noninterest expense..............................   114.84       118.49

Net interest rate spread  (difference between weighted
  average yield on interest-earning assets and weighted
  average cost of interest-bearing liabilities)........................     3.80         3.68

Net yield on average interest-earning assets...........................     4.19         4.23

QUALITY RATIOS:

Non-performing loans to total loans
  at end of period.....................................................   1.13           1.31

Non-performing loans to total assets...................................   0.92           1.11

Non-performing assets to total assets
  at end of period.....................................................   0.96           1.11

Allowance for loan losses to non-performing
  loans at end of period...............................................  91.27          75.64

Allowance for loan losses to total loans...............................   1.03           0.99

CAPITAL RATIOS:

Equity to total assets at end of period................................   9.13          10.26

Average equity to average assets.......................................   9.35          10.86

</TABLE>

                                       4
<PAGE>

                      BUSINESS OF THE COMPANY AND THE BANK

     HIGH COUNTRY BANCORP,  INC. High Country Bancorp,  Inc. (the "Company") was
incorporated  under the laws of the  State of  Colorado  in August  1997 for the
purpose of becoming a savings and loan holding  company for Salida  Building and
Loan  Association  which  changed its name to High  Country Bank (the "Bank") in
February 2000. On December 9, 1997,  the Bank  consummated  its conversion  from
mutual to stock form (the  "Conversion")  and the Company completed its offering
of Common  Stock  through the sale and  issuance of  1,322,500  shares of Common
Stock at a price of $10.00 per share,  realizing gross proceeds of $13.2 million
and net  proceeds of $12.7  million.  The Company  purchased  all of the capital
stock of the Bank with $5.8 million of the offering  proceeds.  On May 24, 1999,
the Company  announced  that it was  commencing  a stock  repurchase  program to
acquire up to 10% of the Company's  outstanding shares of Common Stock, or up to
132,250 shares, over a 12-month period. On March 20, 2000, the Company announced
a  second  stock  repurchase  program  to  acquire  up to 10%  of the  Company's
outstanding  shares of Common Stock,  or up to 119,025  shares,  over a 12-month
period.  On November 8, 2000,  the  Company  announced a third stock  repurchase
program  to  acquire  up to 10% of the  Company's  outstanding  shares of common
stock,  or up to 107,123  shares over a twelve month  period.  These  repurchase
programs,  all of which  have been  completed,  resulted  in the  repurchase  of
400,291  shares of Company  Common  Stock.  On  November  5, 2001,  the  Company
announced  a  fourth  stock  repurchase  program  to  acquire  up to  10% of the
Company's  outstanding  shares of Common Stock,  or up to 92,221 shares,  over a
12-month  period.   Through   September  16,  2002,   16,800  shares  have  been
repurchased.

     The Company  engages in no  significant  activity  other than investing the
proceeds of the offering of Common Stock which it retained, holding the stock of
the Bank and  operating the business of a savings and loan  association  through
the Bank.  Accordingly,  the  information  set forth in this  report,  including
financial  statements  and related data,  relates  primarily to the Bank and its
subsidiaries.

     The  Company's  executive  offices  are located at 7630 West US Highway 50,
Salida, Colorado. Its telephone number is (719) 539-2516.

     HIGH COUNTRY BANK. The Bank is a federal stock savings and loan association
operating through offices located in Salida (2), Colorado, Buena Vista, Colorado
and Leadville,  Colorado and serving Chaffee, Lake, Western Fremont and Saguache
Counties  in   Colorado.   The  Bank  was   chartered   in  1886  as  the  first
state-chartered  building and loan  association  in Colorado.  The Bank received
federal  insurance  of its deposit  accounts  and became a member of the FHLB in
1937. The Bank became a federally chartered association on August 16, 1993 under
the name of Salida Building and Loan  Association.  Effective  December 9, 1997,
the Bank became a stock savings and loan association.  The Company's subsidiary,
High Country Title and Escrow Company, offers title insurance and escrow closing
services  within the Bank's  market area.  At June 30, 2002,  the Bank had total
assets of $176.6  million,  loans  receivable  (net) of  $143.8  million,  total
deposits of $116.1 million and equity of $16.1 million.

     Historically, the Bank has operated as a traditional savings institution by
emphasizing the origination of loans secured by one- to four-family  residences.
Since fiscal 1996,  the Bank has  significantly  increased  its  origination  of
consumer,  commercial business and commercial real estate loans, including loans
for the  purchase  and  development  of raw land,  all of which  loans have been
originated in its market area.

     The Bank is subject to  examination  and  comprehensive  regulation  by the
Office of Thrift  Supervision  ("OTS"),  and the  Bank's  savings  deposits  are
insured  up to  applicable  limits by the  Savings  Association  Insurance  Fund
("SAIF"),  which is administered by the Federal  Deposit  Insurance  Corporation
("FDIC").  The Bank is a member of and owns  capital  stock in the Federal  Home
Loan Bank  ("FHLB")  of Topeka,  which is one of 12  regional  banks in the FHLB
System.  The Bank is further subject to regulations of the Federal Reserve Board
governing  reserves to be  maintained  and certain  other  matters.  Regulations
significantly affect the operations of the Bank.

     The Bank's  executive  offices  are  located  at 7360 West US  Highway  50,
Salida, Colorado 81201-0309 and its main telephone number is (719) 539-2516.

                                       5
<PAGE>
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

     Prior to the acquisition of all of the  outstanding  stock of the Bank, the
Company had no assets or  liabilities  and  engaged in no  business  activities.
Since its  acquisition  of the Bank,  the Company has engaged in no  significant
activity other than holding the stock of the Bank, investing the net proceeds of
the  offering  and  operating  the  business of a savings  and loan  association
through  the  Bank.  Accordingly,  the  information  set  forth in this  report,
including financial statements and related data, relates primarily to the Bank.

     The principal  business of the Bank consists of accepting deposits from the
general  public and investing  these funds  primarily in loans and in investment
securities and  mortgage-backed  securities.  The Bank's loan portfolio consists
primarily  of loans  secured by  residential  real estate  located in its market
area,  with  terms  of 15 to 30  years,  as  well  as  commercial  real  estate,
commercial business, land development and consumer loans.

     The Bank's net income is dependent  primarily  on its net interest  income,
which is the difference  between interest income earned on its loan,  investment
securities  and  mortgage-backed  securities  portfolio  and  interest  paid  on
interest-bearing  liabilities.  Net  interest  income is  determined  by (i) the
difference  between yields earned on  interest-earning  assets and rates paid on
interest-bearing  liabilities  ("interest  rate  spread")  and (ii) the relative
amounts of interest-earning assets and interest-bearing  liabilities. The Bank's
interest rate spread is affected by regulatory, economic and competitive factors
that  influence  interest  rates,  loan  demand and deposit  flows.  To a lesser
extent,  the Bank's  net income  also is  affected  by the level of  noninterest
expenses such as compensation and employee benefits and operating expenses.

     The  operations  of the  Bank  are  significantly  affected  by  prevailing
economic  conditions,  competition  and  the  monetary,  fiscal  and  regulatory
policies of  governmental  agencies.  Lending  activities  are influenced by the
demand  for and  supply of  housing,  competition  among  lenders,  the level of
interest rates and the  availability of funds.  Deposit flows and costs of funds
are  influenced by prevailing  market rates of interest,  primarily on competing
investments, account maturities and the levels of personal income and savings in
the Bank's market area.

FORWARD-LOOKING STATEMENTS

     When used in this Annual Report, the words or phrases "will likely result,"
"are expected to," "will continue," "is anticipated,"  "estimate,"  "project" or
similar expressions are intended to identify "forward-looking statements" within
the  meaning of the  Private  Securities  Litigation  Reform  Act of 1995.  Such
statements are subject to certain risks and  uncertainties  including changes in
economic  conditions  in the  Company's  market  area,  changes in  policies  by
regulatory  agencies,  fluctuations in interest  rates,  demand for loans in the
Company's  market area,  competition  and  information  provided by  third-party
vendors that could cause actual  results to differ  materially  from  historical
earnings and those  presently  anticipated  or projected.  The Company wishes to
caution  readers  not  to  place  undue  reliance  on any  such  forward-looking
statements,  which speak only as of the date made.  The Company wishes to advise
readers  that the factors  listed  above could  affect the  Company's  financial
performance  and could cause the Company's  actual results for future periods to
differ  materially  from any opinions or  statements  expressed  with respect to
future periods in any current statements.

     The Company does not undertake,  and specifically disclaims any obligation,
to  publicly  release  the  result  of any  revisions  which  may be made to any
forward-looking  statements to reflect events or circumstances after the date of
such  statements or to reflect the occurrence of  anticipated  or  unanticipated
events.

                                       6
<PAGE>
ASSET/LIABILITY MANAGEMENT

     The  Bank's  asset/liability  management  strategy  has  been to  emphasize
shorter  term loans and develop a deposit  portfolio  of  transaction  accounts.
Beginning in late fiscal 1999 the Bank began selling long-term  fixed-rate loans
in the secondary market.  The Bank's business plan calls for continued  emphasis
on shorter term, adjustable rate loans and sales of long-term fixed-rate loans.

     As noted  above,  the Bank is seeking to reduce its  exposure to changes in
interest  rates by  originating  shorter term consumer and  commercial  business
loans  with  maturities  of no  more  than 10  years  and by  selling  long-term
fixed-rate  loans.  The  matching of the Bank's  assets and  liabilities  may be
analyzed  by  examining  the  extent to which its  assets  and  liabilities  are
interest rate sensitive and by monitoring the expected  effects of interest rate
changes on the Bank's net interest income.

     An asset or liability is interest  rate  sensitive  within a specific  time
period if it will  mature or  reprice  within  that time  period.  If the Bank's
assets  mature  or  reprice  more  quickly  or  to a  greater  extent  than  its
liabilities,  the Bank's net portfolio  value and net interest income would tend
to increase  during periods of rising interest rates but decrease during periods
of falling interest rates. If the Bank's assets mature or reprice more slowly or
to a lesser extent than its liabilities,  the Bank's net portfolio value and net
interest  income would tend to decrease  during periods of rising interest rates
but  increase  during  periods of  falling  interest  rates.  As a result of the
interest rate risk inherent in the historical  savings  institution  business of
originating long-term loans funded by short-term deposits,  the Bank has pursued
certain  strategies  designed to decrease the  vulnerability  of its earnings to
material and prolonged changes in interest rates.

INTEREST RATE SENSITIVITY ANALYSIS

     The matching of assets and  liabilities  may be analyzed by  examining  the
extent to which such assets and liabilities are "interest rate sensitive" and by
monitoring  an  institution's  interest  rate  sensitivity  "gap."  An  asset or
liability is said to be interest rate sensitive  within a specific  period if it
will mature or reprice within that period.  The interest rate sensitivity gap is
defined as the difference between the amount of interest-earning assets maturing
or repricing  within a specific  time period and the amount of  interest-bearing
liabilities  maturing or repricing  within that time period. A gap is considered
positive when the amount of interest rate sensitive assets exceeds the amount of
interest rate sensitive liabilities,  and is considered negative when the amount
of interest  rate  sensitive  liabilities  exceeds  the amount of interest  rate
sensitive assets.

     Generally,  during a period of rising  interest rates, a negative gap would
be expected to adversely  affect net interest  income while a positive gap would
be expected to result in an increase in net interest  income,  while  conversely
during a period of declining interest rates, a negative gap would be expected to
result  in an  increase  in net  interest  income  and a  positive  gap would be
expected to adversely  affect net interest  income.  As noted above, the Bank is
attempting  to  improve  its   significant   negative  gap  by  emphasizing  the
origination of shorter term consumer and commercial business loans.

     NET PORTFOLIO  VALUE.  In recent years,  the Bank has measured its interest
rate sensitivity by computing the "gap" between the assets and liabilities which
were expected to mature or reprice within certain periods,  based on assumptions
regarding loan prepayment and deposit decay rates formerly  provided by the OTS.
Currently,  interest rate  sensitivity is calculated to determine the amounts by
which  the net  present  value  of an  institution's  cash  flows  from  assets,
liabilities and off balance sheet items (the  institution's net portfolio value,
or "NPV")  would  change in the event of a range of  assumed  changes  in market
interest rates. These  computations  estimate the effect on an institution's NPV
from  instantaneous  and  permanent 1% to 3% increases  and  decreases in market
interest  rates.  In the Bank's  interest rate  sensitive  policy,  the Board of
Directors has established a maximum  decrease in net interest income and maximum
decreases in NPV given these instantaneous changes in interest rates.

                                       7
<PAGE>

     The following table sets forth the interest rate  sensitivity of the Bank's
net  portfolio  value  as of  June  30,  2002  in the  event  of  1%,  2% and 3%
instantaneous  and permanent  increases in market interest rates,  respectively.
Due  to an  abnormally  low  prevailing  interest  rate  environment,  only a 1%
instantaneous and permanent decrease in market interest rates is included. These
changes are set forth below as basis  points,  where 100 basis points equals one
percentage point.
<TABLE>
<CAPTION>
                                  NET PORTFOLIO VALUE                          NPV AS % OF PORTFOLIO VALUE OF ASSETS
      CHANGE             -----------------------------------------             -------------------------------------
      IN RATES           $ AMOUNT        $ CHANGE       % CHANGE               NPV RATIO       BASIS  POINT  CHANGE
      --------           --------        --------       --------               ---------       --------------------
                                             (DOLLARS IN THOUSANDS)
      <S>                <C>               <C>              <C>                   <C>                  <C>
      + 300 bp           $ 22,644         -2,722            (11)%                 12.40%               (99) bp
      + 200 bp             24,003         -1,362             (5)                  12.96                (43) bp
      + 100 bp             24,925           -441             (2)                  13.30                (10) bp
          0 bp             25,366                                                 13.40
      - 100 bp             25,191           -174             (1)                  13.21                (19) bp
</TABLE>

     The following table sets forth the interest rate risk capital component for
the Bank at June 30,  2002 given a  hypothetical  200 basis point rate change in
market interest rates.

                                                                   JUNE 30, 2002
                                                                   -------------
Pre-shock NPV Ratio: NPV as % of Portfolio Value of Assets .........  13.40%
Exposure Measure: Post-Shock NPV Ratio .............................  12.96%
Sensitivity Measure: Change in NPV Ratio ...........................  43 bp


     Computations of prospective  effects of hypothetical  interest rate changes
are based on numerous assumptions,  including relative levels of market interest
rates and loan  prepayments,  and should  not be relied  upon as  indicative  of
actual  results.  Further,  the  computations do not contemplate any actions the
Bank may undertake in response to changes in interest rates.

     Certain  shortcomings  are inherent in the method of analysis  presented in
both the  computation  of NPV and in the  analysis  presented  in  prior  tables
setting  forth  the  maturing  and  repricing  of  interest-earning  assets  and
interest-bearing   liabilities.   For  example,   although  certain  assets  and
liabilities may have similar maturities or periods to repricing,  they may react
in differing  degrees to changes in market interest rates. The interest rates on
certain of assets and  liabilities may fluctuate in advance of changes in market
interest  rates,  while interest rates on other assets and  liabilities  may lag
behind changes in market rates.  Based on the above,  net interest income should
decline with instantaneous increases in interest rates while net interest income
should increase with instantaneous  declines in interest rates.  Further, in the
event of a change in interest  rates,  prepayment  and early  withdrawal  levels
would likely deviate significantly from those assumed in the tables.

     The Bank originates  fixed-rate and variable-rate real estate loans and has
historically  held most loans in portfolio  until  maturity.  Because the Bank's
interest-bearing  liabilities  which  mature or  reprice  within  short  periods
substantially exceed its earning assets with similar  characteristics,  material
and prolonged  increases in interest rates generally would adversely  affect net
interest  income,  while  material and  prolonged  decreases  in interest  rates
generally,  but to a lesser  extent  because of their  historically  low levels,
would have the opposite effect.

                                       8
<PAGE>

AVERAGE BALANCE, INTEREST AND AVERAGE YIELDS AND RATES

     The following table sets forth certain  information  relating to the Bank's
average  interest-earning  assets and interest-bearing  liabilities and reflects
the average yield on assets and average cost of liabilities  for the periods and
at the date  indicated.  Such yields and costs are derived by dividing income or
expense by the average monthly  balance of assets or liabilities,  respectively,
for the periods presented. Management does not believe that the use of month-end
balances  instead of daily  balances has caused any material  difference  in the
information presented.

     The  table  also  presents  information  for the  periods  and at the  date
indicated  with respect to the  difference  between the average  yield earned on
interest-earning  assets and average rate paid on interest-bearing  liabilities,
or "interest rate spread," which savings institutions have traditionally used as
an  indicator  of  profitability.  Another  indicator  of an  institution's  net
interest income is its "net yield on interest-earning  assets," which is its net
interest income divided by the average balance of  interest-earning  assets. Net
interest  income is affected  by the  interest  rate spread and by the  relative
amounts  of  interest-earning  assets  and  interest-bearing  liabilities.  When
interest-earning assets approximate or exceed interest-bearing  liabilities, any
positive interest rate spread will generate net interest income.
<TABLE>
<CAPTION>
                                                                         YEAR ENDED JUNE 30,
                                               ---------------------------------------------------------------------------
                                                             2002                                    2001
                                               ---------------------------------       -----------------------------------
                                                                         AVERAGE                                   AVERAGE
                                               AVERAGE                   YIELD/        AVERAGE                      YIELD/
                                               BALANCE      INTEREST      COST         BALANCE       INTEREST        COST
                                               -------      --------     -------       -------       --------      -------
                                                                         (DOLLARS IN THOUSANDS)
<S>                                            <C>          <C>           <C>          <C>           <C>            <C>
INTEREST-EARNING ASSETS:
Interest-bearing deposits...................   $ 10,615     $   222       2.09%        $    4,091    $     52       1.27%
  Investments...............................      9,876         441       4.47              4,766         353       7.41
  Loans.....................................    139,092      12,093       8.69            132,967      11,926       8.97
                                               --------     -------                    ----------    --------
Total interest-earning assets ..............    159,583      12,756       7.99            141,824      12,331       8.69
                                                            -------                                  --------
Non-interest-earning assets.................      9,944                                     8,915
                                               --------                                ----------
Total assets................................   $169,527                                $  150,739
                                               ========                                ==========

INTEREST-BEARING LIABILITIES:
  Savings deposits..........................   $102,153     $ 3,488       3.41         $   83,947    $  3,663       4.36
  FHLB advances.............................     42,510       2,580       6.07             42,581       2,670       6.27
                                               --------     -------                    ----------    --------
Total interest-bearing liabilities..........    144,663       6,068       4.19            126,528       6,333       5.01
                                                            -------                                  --------
Non-interest bearing liabilities............      9,005                                     7,848
                                               --------                                ----------
Total liabilities...........................    153,668                                   134,376
Equity......................................     15,859                                    16,363
                                               --------                                ----------
Total liabilities and equity................   $169,527                                $  150,739
                                               ========                                ==========
Net interest income.........................                $ 6,688                                  $  5,998
                                                            =======                                  ========
Net interest rate spread (1)................                              3.80%                                     3.68%
                                                                         =====                                     =====
Net interest\dividend earning assets........                $14,920                                  $ 15,296
                                                            =======                                  ========
Net interest margin (2).....................                              4.19%                                     4.23%
                                                                         =====                                     =====
Average interest-earning assets to
  average interest-bearing liabilities (3)..                 110.31%                                   112.09%
                                                            =======                                  ========
<FN>
____________
(1)  Net interest  rate spread  represents  the  difference  between the average
     yield on  interest-earning  assets and the average rate on interest-bearing
     liabilities.
(2)  Net  interest  margin  represents  net interest  income  divided by average
     interest-earning assets.
(3)  Due to the immaterial  amount of non-accruing  loans,  the balances of such
     loans have been included as interest-earning assets.
</FN>
</TABLE>

                                       9
<PAGE>

RATE/VOLUME ANALYSIS

     The following  table sets forth certain  information  regarding  changes in
interest income and interest expense of the Bank for the periods indicated.  For
each  category  of  interest-earning   asset  and  interest-bearing   liability,
information  is  provided  on changes  attributable  to:  (i)  changes in volume
(changes in volume  multiplied  by old rate);  (ii) changes in rate  (changes in
rate  multiplied by old volume);  and (iii) changes in  rate/volume  (changes in
rate multiplied by changes in volume).
<TABLE>
<CAPTION>
                                                   YEAR ENDED JUNE 30,
                                         -------------------------------------------
                                                2002        VS.         2001
                                         -------------------------------------------
                                                      INCREASE (DECREASE)
                                                            DUE TO
                                         -------------------------------------------
                                                                   RATE/
                                         VOLUME       RATE         VOLUME      TOTAL
                                         ------       ----         ------      -----
                                                        (IN THOUSANDS)
<S>                                      <C>          <C>          <C>         <C>
INTEREST-EARNING ASSETS:
  Interest-bearing deposits............  $    83      $   34       $    53     $    170
  Investments..........................      378        (140)         (150)          88
  Loans................................      549        (365)          (17)         167
                                         -------      ------       -------     --------
    Total interest-earning assets......    1,010        (471)         (114)         425
                                         -------      ------       -------     --------

INTEREST-BEARING LIABILITIES:
  Deposits.............................      794        (797)         (172)        (175)

  FHLB advances........................       (5)        (85)            0          (90)
                                         -------      ------       -------     --------
     Total interest-bearing
       liabilities.....................      789        (882)         (172)        (265)
                                         -------      ------       -------     --------
  Increase (decrease) in net interest
    income.............................  $   221      $  411       $    58     $    690
                                         =======      ======       =======     ========
</TABLE>

COMPARISON OF FINANCIAL CONDITION AT JUNE 30, 2002 AND JUNE 30, 2001

     The Company's  total assets  increased by $15.3 million or 9.5% from $161.3
million at June 30, 2001 to $176.6  million at June 30,  2002.  The  increase in
assets was due to  mortgage-backed  securities  growth of $8.1  million and loan
growth of $7.0 million.

     Mortgage-backed  securities  classified as "held to maturity"  increased by
$8.1  million  from $2.2  million at June 30, 2001 to $10.3  million at June 30,
2002.  The  Bank  purchased  adjustable-rate  GNMA  and  FHLMC  mortgage  backed
securities in order to improve investment yields as compared to interest-bearing
deposits and lower  interest rate risk. At June 30, 2002 the  securities  had an
estimated  fair value of $10.3  million.  The Bank  purchased  $300,000 in local
municipal  bonds in March 2002.  The bonds are classified as "held to maturity."
At June 30, 2002 the  securities  had an estimated  fair value of $310,000.  The
balance of the  Company's  investment  portfolio was  interest-bearing  deposits
which totaled $8.6 million at June 30, 2002. In the upcoming months, these funds
may be used for paying down FHLB advances,  seasonal deposit  withdrawals,  loan
demand and investment purchases.

     Net loans  increased  $7.0 million from $136.8  million at June 30, 2001 to
$143.8  million at June 30, 2002.  The increase in loans  occurred in commercial
real estate loans which  increased $6.0 million,  land loans which  increased by
$2.6 million and commercial  nonmortgage  loans which increased by $2.5 million.
The Bank  benefited  from strong local demand for  purchase  financing  and loan
refinancing.  The loan growth in these areas offset a $3.0  million  decrease in
single-family loans with the refinancing of portfolio loans into sold loans.

     During the year,  the Bank  continued  the program of ongoing loan sales of
fixed-rate  loans to the Federal Home Loan Mortgage  Corporation  (FHLMC).  Loan
sales for the year ended  June 30,  2002 were $50.9  million  compared  to $28.0
million  for the year ended June 30,  2001.  The sales  began in order to manage
interest rate risk,

                                       10
<PAGE>

compete with mortgage companies and increase fee income. At June 30, 2002, loans
held for sale  were  $642,000.  The  loans  are  valued  at the lower of cost or
market.

     As of June 30,  2002 and June 30,  2001,  the  non-performing  loans in the
Bank's  portfolio  were  $1.6  and  $1.8  million,   respectively.  The  largest
non-performing  loan totals  $729,000 and is a business  purpose loan secured by
two single-family  residences and vacant land. No loss is expected on this loan.
The total  non-performing  loans at June 30, 2002  included 22 loans  secured by
commercial  real  estate,  single  family  residences,   vacant  land,  business
equipment  and autos.  During  2002,  the Bank's  primary  lending  area was and
continues  to be affected by a major  drought.  This  drought and nearby  forest
fires  negatively  impacted the local tourism economy during the summer of 2002.
Local  businesses  affected  include  local  motels,   rafting  companies,   and
retailers.  The Bank's largest borrower,  whose primary business is rafting, has
experienced significantly reduced sales. Although as of June 30, 2002, the loans
to the largest  borrower and other local  tourism  related  businesses  were not
included  with  non-performing  loans,  management  believes that because of the
drought a number of these loans may eventually be disclosed as non-performing.

     The  allowance  for loan losses  totaled  $1.5 million at June 30, 2002 and
$1.3 million at June 30, 2001. At June 30, 2002 and June 30, 2001,  the ratio of
the  allowance  for loan losses to net loans was 1.03% and 0.99%,  respectively.
There was  $105,000 of loans  charged off and $6,000 in  recoveries  of previous
loan  losses  during the year  ended June 30,  2002.  The  determination  of the
allowance for loan losses is based on a review and  classification of the Bank's
portfolio  and other  factors,  including  the  market  value of the  underlying
collateral,  growth and composition of the loan portfolio,  the  relationship of
the allowance for loan losses to outstanding loans,  historical loss experience,
delinquency trends and prevailing economic conditions.  Particular attention was
focused on the Bank's commercial loan portfolio and any impaired loans. The Bank
believes the current  level of allowance  for loan losses is adequate to provide
for probable  future  losses,  although  there are no  assurances  that probable
future losses, if any, will not exceed estimated amounts.

     At June 30, 2002 deposits increased to $116.1 million from $98.5 million at
June 30, 2001 or a net increase of 17.9%.  The  increase  funded  investment  in
mortgage-backed  securities and loan growth.  Competitive rates and stock market
uncertainty  fueled  the  growth.   Management  is  continually  evaluating  the
investment  alternatives  available to the Company's customers,  and adjusts the
pricing on its savings products to maintain its existing deposits.

     Advances from the Federal Home Loan Bank decreased to $42.6 million at June
30, 2002 from $44.1  million at June 30,  2001.  Funds from  deposit  growth and
interest-bearing deposits were used to pay off maturing advances.

     On November 5, 2001,  the Company  announced a plan to repurchase up to 10%
or 92,221 shares of the outstanding  stock. Since November 5, 2001, the Bank has
repurchased  16,800  shares at a cost of  $282,000.  For the year ended June 30,
2002, the Bank repurchased 123,583 shares at a cost of $2.0 million. The Company
paid dividends of $0.25 per share in November 2001 and May 2002.

COMPARISON OF OPERATING RESULTS FOR THE YEAR ENDED JUNE 30, 2002 AND 2001

     NET INCOME.  The  Company's net income for the year ended June 30, 2002 was
$1.7  million  compared to $1.3  million for the year ended June 30,  2001.  The
increase in net income  resulted  primarily from increased  interest  income and
non-interest loan sale income which offset increased compensation, and occupancy
expenses.

     NET INTEREST  INCOME.  Net interest income for the year ended June 30, 2002
was $6.7 million  compared to $6.0 million for the year ended June 30, 2001. The
increase is attributed to increased  interest earned on interest  earning assets
due to loan  growth,  mortgage-backed  security  purchases  and  higher  average
interest-bearing  deposits.  Interest  expense  decreased due to lower  interest
costs which offset the  increase in interest  bearing  liabilities.  The average
yield on interest  earning  assets  decreased from 8.69% for the year ended June
30,  2001 to 7.99% for the year ended June 30,  2002.  The  decrease in yield is
associated  with the  growth in lower  earning  interest  bearing  deposits  and
mortgage backed  securities and lower rate loan refinances.  The average cost of
interest  bearing  liabilities also decreased from 5.01% for the year ended June
30, 2001 to 4.19% for the year ended June 30, 2002.

                                       11
<PAGE>

The  decrease in average  cost is due to less  reliance on higher  costing  FHLB
advances and lower deposit rates.  The interest rate spread increased from 3.68%
for the year ended June 30, 2001 to 3.80% for the year ended June 30, 2002.

     PROVISION  FOR LOAN LOSSES.  The provision for loan losses was $236,000 for
the year ended June 30, 2002  compared  to $385,000  for the year ended June 30,
2001.  The  decrease  in  the  provision  was  due  to  relative   stability  of
non-performing loans.

     NON-INTEREST  INCOME.  Non-interest  income increased from $1.2 million for
the year ended June 30, 2001 to $1.9  million for the year ended June 30,  2002.
The increase is primarily  due to loan sales of $50.9 million for the year ended
June 30, 2002 compared to $28.0 million for the year ended June 30, 2001.  Title
and escrow fees and other income also  increased  due to greater  loan  activity
resulting from historically low mortgage loan interest rates.

     NON-INTEREST EXPENSE.  Non-interest expense increased from $4.8 million for
the year ended June 30, 2001 to $5.6  million for the year ended June 30,  2002.
The majority of the increase was in compensation and benefit expense,  occupancy
expense and other expenses.  The increases are tied to additional  employees and
other expenses due to growth.

LIQUIDITY AND CAPITAL RESOURCES

     The Company's primary sources of funds consist of deposits,  FHLB advances,
repayment of loans and mortgage-backed securities, maturities of investments and
interest-bearing  deposits, and funds provided from operations.  While scheduled
repayments of loans and mortgage-backed  securities and maturities of investment
securities are predicable  sources of funds,  deposit flows and loan prepayments
are  greatly  influenced  by the  general  level  of  interest  rates,  economic
conditions and competition. The Company uses its liquidity resources principally
to fund existing and future loan commitments,  to fund maturing  certificates of
deposit and demand  deposit  withdrawals,  to fund  maturing FHLB  advances,  to
invest in other  interest-earning  assets,  to maintain  liquidity,  and to meet
operating  expenses.  Management believes that proceeds from loan repayments and
other  sources of funds will be adequate to meet the Company's  liquidity  needs
for the immediate future.

     The Bank is required to maintain sufficient  liquidity to ensure a safe and
sound  operation.  Management  believes that the Bank's sources of liquidity for
potential uses are adequate under the revised regulations.

IMPACT OF INFLATION AND CHANGING PRICES

     The  financial  statements  and  related  data  presented  herein have been
prepared in accordance  with generally  accepted  accounting  principles,  which
require the measurement of financial position and results of operations in terms
of historical  dollars without  considering  changes in the relative  purchasing
power of money over time because of inflation. Unlike most industrial companies,
virtually  all of the assets and  liabilities  of the  Company  are  monetary in
nature.  As a  result,  interest  rates  have a more  significant  impact on the
Company's performance than the effects of general levels of inflation.  Interest
rates do not necessarily  move in same direction or in the same magnitude as the
prices of goods and services.

                                       12
<PAGE>

IMPACT OF NEW ACCOUNTING STANDARDS

     In December 2001,  the  Accounting  Standards  Executive  Committee  issued
Statement of Position 01-06,  Accounting by Certain Entities (Including Entities
With Trade  Receivables) That Lend to or Finance the Activities of Others.  This
SOP  reconciles  and conforms,  as  appropriate,  the  accounting  and financial
reporting provisions  established by the BSI Guide, CU Guide, and FC Guide. This
SOP eliminates  differences  in accounting  established by the Guides where such
differences are not warranted.  In addition,  the SOP carries forward accounting
guidance for  transactions  unique to certain  financial  entities.  Most of the
differences  between the respective guides represent  presentation or disclosure
requirements.  The impact of adopting  this SOP in December  2001 did not have a
material affect on the financial statements or the disclosures.

                                       13
<PAGE>

                        CONSOLIDATED FINANCIAL STATEMENTS
                   HIGH COUNTRY BANCORP, INC. AND SUBSIDIARIES

                                                                           PAGE

Independent Auditors' Report                                                15

Consolidated Statements of Financial Condition as of June
  30, 2002 and 2001                                                         16

Consolidated Statements of Income for the Years Ended June
  30, 2002 and 2001                                                         17

Consolidated Statements of Equity for the Years Ended June
  30, 2002 and 2001                                                         18

Consolidated Statements of Cash Flows for the Years Ended June
  30, 2002 and 2001                                                         19

Notes to Consolidated Financial Statements                                  20


                                       14
<PAGE>

                            GRIMSLEY, WHITE & COMPANY

                          Certified Public Accountants
                           And Management Consultants

                                                                301 Raton Avenue
                                                   La Junta, Colorado 81050-1697
                                                                    719-384-5489








                          INDEPENDENT AUDITORS' REPORT



To the Board of Directors and Stockholders
High Country Bancorp, Inc.
Salida, Colorado

We have audited the accompanying  consolidated statements of financial condition
of High  Country  Bancorp,  Inc. as of June 30,  2002 and 2001,  and the related
consolidated  statements  of income,  equity,  and cash flows for the years then
ended.  These  consolidated  financial  statements are the responsibility of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
consolidated financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  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 consolidated  financial statements referred to above present
fairly,  in all  material  respects,  the  financial  position  of High  Country
Bancorp, Inc. as of June 30, 2002 and 2001 and the results of its operations and
its cash flows for the years then ended in conformity with accounting principles
generally accepted in the United States of America.

                                           /s/ Grimsley, White & Company

                                           GRIMSLEY, WHITE & COMPANY


La Junta, Colorado
August 27, 2002

                                       15
<PAGE>

                           HIGH COUNTRY BANCORP, INC.

                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

                             JUNE 30, 2002 AND 2001
<TABLE>
<CAPTION>
                          ASSETS                                                     2002                2001
                                                                                 -------------       --------------
<S>                                                                              <C>                  <C>
Cash and amounts due from banks                                                  $   2,873,502        $   2,759,671
Interest- bearing deposits at other institutions                                     8,590,443            9,175,856
Mortgage-backed securities, held to maturity                                        10,306,936            2,220,909
Securities held to maturity                                                            303,039                   --
Loans receivable - net                                                             143,195,129          135,916,318
Loans held for sale                                                                    642,000              917,500
Federal Home Loan Bank stock, at cost                                                2,421,600            2,421,600
Accrued interest receivable                                                          1,299,341            1,121,412
Property and equipment, net                                                          6,069,688            6,111,907
Mortgage servicing rights                                                                6,788               14,504
Prepaid expenses and other assets                                                      693,583              508,187
Deferred income taxes                                                                  183,100              162,800
                                                                                 -------------        -------------
            TOTAL ASSETS                                                         $ 176,585,149        $ 161,330,664
                                                                                 =============        =============

                  LIABILITIES AND EQUITY
LIABILITIES
Deposits                                                                         $ 116,142,046         $ 98,517,228
Advances by borrowers for taxes and insurance                                                -               29,724
Escrow accounts                                                                        657,271            1,070,624
Accounts payable and other liabilities                                               1,013,064              988,588
Advances from Federal Home Loan Bank                                                42,641,665           44,124,999
Accrued income taxes payable                                                                --               40,167
                                                                                 -------------        -------------

            TOTAL LIABILITIES                                                      160,454,046          144,771,330
                                                                                 -------------        -------------
Commitments and contingencies

EQUITY
Preferred stock- $.01 par value; authorized 1,000,000
   shares; no shares issued or outstanding                                                  --                   --
Common stock-$.01 par value; authorized 3,000,000 shares;
   issued and outstanding 905,409 (2002)and 1,028,992 shares (2001)                      9,054               10,290
Paid-in capital                                                                      7,262,469            9,151,686
Retained earnings - substantially restricted                                         9,461,842            8,215,667
Note receivable from ESOP Trust                                                       (521,065)            (626,865)
Deferred MRP stock awards                                                              (81,197)            (191,444)
                                                                                 -------------        -------------

            TOTAL EQUITY                                                            16,131,103           16,559,334
                                                                                 -------------        -------------

            TOTAL LIABILITIES AND EQUITY                                         $ 176,585,149        $ 161,330,664
                                                                                 =============        =============
</TABLE>

                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       16
<PAGE>
                           HIGH COUNTRY BANCORP, INC.

                        CONSOLIDATED STATEMENTS OF INCOME

                       YEARS ENDED JUNE 30, 2002 AND 2001
<TABLE>
<CAPTION>
                                                                                     2002              2001
                                                                                 ------------      ------------
<S>                                                                              <C>               <C>
Interest Income
      Interest on loans                                                          $ 12,092,902      $ 11,926,363
      Interest on securities held-to-maturity                                         306,060           178,492
      Interest on other interest- bearing assets                                      356,547           226,839
                                                                                 ------------      ------------

                  Total interest income                                            12,755,509        12,331,694
                                                                                 ------------      ------------
Interest Expense
      Deposits                                                                      3,488,371         3,662,818
      Federal Home Loan Bank advances                                               2,579,583         2,670,482
                                                                                 ------------      ------------

                  Total interest expense                                            6,067,954         6,333,300
                                                                                 ------------      ------------

                  Net interest income                                               6,687,555         5,998,394
Provision for losses on loans                                                         236,000           385,000
                                                                                 ------------      ------------
                  Net income after provision
                        for loan losses                                             6,451,555         5,613,394
                                                                                 ------------      ------------
Noninterest Income
      Service charges on deposits                                                     262,747           209,496
      Loans sold                                                                      802,851           408,872
      Title and escrow fees                                                           354,265           305,278
      Other                                                                           443,110           301,065
                                                                                 ------------      ------------
                  Total noninterest income                                          1,862,973         1,224,711
                                                                                 ------------      ------------
Noninterest Expense
     Compensation and benefits                                                      3,378,607         2,742,264
     Occupancy and equipment                                                        1,261,385         1,115,756
     Insurance and professional fees                                                  289,121           249,549
     Other                                                                            687,627           648,075
                                                                                 ------------      ------------
                  Total noninterest expense                                         5,616,740         4,755,644
                                                                                 ------------      ------------

                  Income before income taxes                                        2,697,788         2,082,461

                  Income tax expense                                                1,026,449           810,082
                                                                                 ------------      ------------

                  Net income                                                     $  1,671,339      $  1,272,379
                                                                                 ============      ============

Basic Earnings Per Common Share                                                  $       1.90      $       0.96
                                                                                 ============      ============
Diluted Earning Per Common Share                                                 $       1.85      $       0.96
                                                                                 ============      ============
Weighted Average Common Shares Outstanding
     Basic                                                                            877,653         1,090,233
     Diluted                                                                          905,173         1,090,233
Dividends Paid Per Share                                                         $      0.500      $      0.450
</TABLE>
                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       17
<PAGE>
                           HIGH COUNTRY BANCORP, INC.

                        CONSOLIDATED STATEMENTS OF EQUITY

                       YEARS ENDED JUNE 30, 2002 AND 2001
<TABLE>
<CAPTION>
                                                                                         NOTE             DEFERRED
                                         COMMON         PAID-IN         RETAINED       RECEIVABLE           STOCK
                                          STOCK         CAPITAL         EARNINGS          ESOP              AWARDS
                                         -------        -------         --------       ----------         ---------
<S>                                      <C>           <C>              <C>              <C>              <C>
BALANCES JUNE 30, 2000                   $ 10,712      $ 9,720,159      $7,433,495       $ (732,665)      $ (324,052)

     Net income                                                          1,272,379

     MRP stock awards                                          290                                           132,608

     ESOP contribution                                      37,977

     ESOP note payment                                                                      105,800

     Stock purchased and
      retired                                (422)        (606,740)

     Dividends paid                                                       (490,207)
                                         --------      -----------      ----------       ----------       ----------
BALANCES JUNE 30, 2001                     10,290        9,151,686       8,215,667         (626,865)        (191,444)

     Net income                                                          1,671,339

     MRP stock awards                                       18,583                                           110,247

     ESOP contribution                                      77,796

     ESOP note payment                                                                      105,800

     Stock purchased and
     retired                               (1,236)      (1,985,596)

     Dividends paid                                                       (425,164)

                                         --------      -----------      ----------       ----------       ----------
BALANCES JUNE 30, 2002                    $ 9,054      $ 7,262,469     $ 9,461,842       $ (521,065)      $  (81,197)
                                         ========      ===========      ==========       ==========       ==========
</TABLE>

                        SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       18
<PAGE>
                           HIGH COUNTRY BANCORP, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                       YEARS ENDED JUNE 30, 2002 AND 2001
<TABLE>
<CAPTION>
                                                                           2002           2001
                                                                       ------------    ------------
      <S>                                                              <C>             <C>
      Operating Activities
            Net income                                                 $  1,671,339    $  1,272,379
            Adjustments to reconcile net income to net cash provided
                  by operating activities:
            Amortization of:
                  Deferred loan origination fees                           (182,137)       (137,549)
                  Premiums on investments                                   169,735           5,124
            Loss on disposition of equipment                                  8,326          12,598
            Compensation expense on ESOP shares                             105,800         105,800
            Compensation expense on Management Recognition Plan              73,651         132,897
            ESOP market value expense                                        77,796          37,977
            Provision for losses on loans                                   236,000         385,000
            Deferred income taxes                                           (20,300)       (116,500)
            Depreciation                                                    442,898         398,647
            Income taxes                                                    (40,167)         28,593
            Net change in miscellaneous assets                             (355,609)       (338,103)
            Net change in miscellaneous liabilities                          79,655         226,035
                                                                       ------------    ------------
                  Net cash provided by operating activities               2,266,987       2,012,898
                                                                       ------------    ------------
      Investing Activities
            Net change in interest bearing deposits                         585,413      (7,854,938)
            Net change in loans receivable                               (7,057,174)    (17,183,728)
            Purchase of securities held-to-maturity                     (11,057,788)             --
            Principal repayments of securities-held-to-maturity           2,498,987         616,856
            Purchase of Federal Home Loan Bank stock                             --        (564,600)
            Purchases of property and equipment                            (409,005)       (451,211)
                                                                       ------------    ------------
                  Net cash used by investing activities                 (15,439,567)    (25,437,621)
                                                                       ------------    ------------
      Financing Activities
            Net change in deposits                                       17,624,818      15,746,830
            Net change in escrow funds                                     (443,077)       (744,356)
            Purchase of common stock                                     (1,986,832)       (607,162)
            Cash dividends paid                                            (425,164)       (490,207)
            Proceeds (payment) on FHLB advances                          (1,483,334)      7,886,666
                                                                       ------------    ------------
                    Net cash provided by financing activities            13,286,411      21,791,771
                                                                       ------------    ------------

                    Net change in cash and cash equivalents                 113,831      (1,632,952)

      Cash and cash equivalents, beginning                                2,759,671       4,392,623
                                                                       ------------    ------------
      Cash and cash equivalents, ending                                $  2,873,502    $  2,759,671
                                                                       ============    ============

      Supplemental disclosure of cash flow information
      Cash paid for:
           Taxes                                                       $  1,169,834    $    664,989
           Interest                                                       6,094,060       6,328,232
</TABLE>

                                       19
<PAGE>
                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -1   OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          The  following is a  description  of the more  significant  accounting
          policies which High Country Bancorp, Inc. (the Company) and its wholly
          owned  subsidiary  High Country Bank formerly Salida Building and Loan
          Association  (the Bank) and its wholly owned  subsidiary  High Country
          Title and  Escrow  Company  follow in  preparing  and  presenting  the
          consolidated financial statements.

          Basis of Presentation
          The  consolidated  financial  statements  include the  accounts of the
          Company and its wholly  owned  subsidiary  High  Country  Bank and its
          wholly owned  subsidiary  High Country Title and Escrow  Company.  All
          significant   intercompany   accounts  and   transactions   have  been
          eliminated.

          Organization
          High  Country  Bank (the  Bank) is a federal  stock  savings  and loan
          association  with its main  office  in  Salida,  Colorado  and  branch
          offices in  Salida,  Leadville  and Buena  Vista,  Colorado.  The Bank
          provides a variety of  financial  services to the area it serves.  Its
          primary deposit products are  interest-bearing  checking  accounts and
          certificates  of deposit,  and its primary  lending  products are real
          estate mortgages, consumer and commercial loans.

          High Country Title & Escrow Company provides title, escrow and closing
          services primarily in Chaffee County.

          The Company's  purpose is to act as a holding company with the Bank as
          its sole subsidiary.  The Company's principal business is the business
          of the  Bank,  title  and  escrow  transactions  of the  wholly  owned
          subsidiary of the bank, and holding investments.

          Savings  deposits  of the  Bank are  insured  by the  Federal  Deposit
          Insurance  Corporation  ("FDIC") up to certain  limitations.  The Bank
          pays a premium to FDIC for the insurance of such savings.

          Use of Estimates
          The preparation of financial  statements in conformity with accounting
          principles generally accepted in the United States 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.

          Investment Securities and Mortgage-Backed Securities
          Securities  Held to  Maturity.  Bonds and notes for which the entities
          have the positive  intent and ability to hold to maturity are reported
          at cost,  adjusted for premiums and discounts  that are  recognized in
          interest income using the interest method over the period to maturity.

          Securities Available for Sale.  Available-for-sale  securities consist
          of  bonds  and  notes  not  classified  as  trading  securities  or as
          held-to-maturity securities.

          Unrealized holding gains and losses, net of tax, on available-for-sale
          securities  are  reported as a net amount in a separate  component  of
          shareholders' equity until realized.

          Gains and  losses  on the sale of  available-for-sale  securities  are
          determined using the specific-identification method.

          Declines  in  the  fair  value  of  individual   held-to-maturity  and
          available-for-sale  securities  below  their  cost that are other than
          temporary would result in write-downs of the individual  securities to
          their fair value.  Should the entities incur  write-downs they will be
          included in earnings as realized losses.

                                       20
<PAGE>

                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -1   OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

          Premiums and  discounts are  recognized  in interest  income using the
          interest method over the period to maturity.

          Federal Home Loan Bank Stock
          The  stock is an  equity  interest  in the  Federal  Home Loan Bank of
          Topeka.  The Bank, as a member of the FHLB, is required to maintain an
          investment in capital stock of the FHLB. The stock is carried at cost,
          as its cost is assumed to equal its market value.  FHLB stock can only
          be sold at par value to the FHLB or to another member institution. The
          FHLB  declares  cash and  stock  dividends.  The stock  dividends  are
          recognized as income due to the fact they are  redeemable at par value
          ($100 per share) from the FHLB or another member institution.

          Loans
          Loans are stated at unpaid principal balances,  less the allowance for
          loan losses, net of deferred loan fees and loans in process.

          Loan  origination  and  commitment  fees,  as well as  certain  direct
          origination  costs,  are deferred and amortized as a yield  adjustment
          over  the  lives of the  related  loans  using  the  interest  method.
          Amortization  of  deferred  loan fees is  discontinued  when a loan is
          placed on nonaccrual status.

          Loans are placed on nonaccrual  status when  principal and interest is
          delinquent for 90 days or more.  Uncollectible interest on these loans
          is charged off, or an allowance is established,  based on management's
          periodic  evaluation,  and by a charge to interest income equal to all
          interest previously accrued. Income is subsequently recognized only to
          the extent that cash payments are received.

          Management  has  determined  that first  mortgage loans on one-to-four
          family  properties,  home  equity,  second  mortgage  loans,  and  all
          consumer loans are large groups of  smaller-balance  homogenous  loans
          that are collectively evaluated.  Accordingly,  such loans are outside
          the scope of FASB Statement Nos. 114 and 118.

          Management considers an insignificant delay, which is determined as 90
          days by the  Association,  will not cause a loan to be  classified  as
          impaired.  A loan is not impaired  during a period of delay in payment
          if the bank  expects to collect  all amounts  due  including  interest
          accrued at the contractual  interest rate for the period of delay. All
          loans   identified   as  impaired  are  evaluated   independently   by
          management.

          Loans Held for Sale
          Loans originated and held for sale in the secondary market are carried
          at the lower or cost or  estimated  fair value in the  aggregate.  Net
          unrealized   losses,  if  any,  are  recognized  through  a  valuation
          allowance by charges to income.

          Allowance for Loan Losses
          The  allowance for loan losses is  maintained  at a level,  which,  in
          management's  judgment,  is adequate to absorb losses  inherent in the
          loan  portfolio.  The amount of the allowance is based on management's
          evaluation of the collectibility of the loan portfolio,  including the
          nature of the  portfolio,  credit  concentrations,  specific  impaired
          loans,  and  economic  conditions.  The  allowance  is  increased by a
          provision for loan losses, which is charged to expense, and reduced by
          charge-offs,   net  of  recoveries.   Such  provisions  are  based  on
          management's  estimate  of net  realizable  value or fair value of the
          collateral, as applicable. These estimates are susceptible to economic
          changes  that  could  result in a  material  adjustment  to results of
          operations  in the near term.  Recovery of the carrying  value of such
          loans is dependent to a great  extent on  economic,  operational,  and
          other conditions that may be beyond the Bank's control.

                                       21
<PAGE>
                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -1   OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued

          Loan Servicing
          The cost of mortgage  servicing  rights is amortized in proportion to,
          and over the period of, estimated net servicing  revenues.  Impairment
          of mortgage  servicing  rights is assessed  based on the fair value of
          those rights.  Fair values are estimated  using  discounted cash flows
          based on a current market interest rate.

          Property and Equipment
          Property   and   equipment   are  stated  at  cost  less   accumulated
          depreciation.   Depreciation   is  calculated   using   primarily  the
          straight-line  method over the  estimated  useful lives of the related
          assets.  Estimated useful lives of furniture,  fixtures, and equipment
          range from two to ten years;  buildings  and  improvements  range from
          five to forty years.

          Income Taxes
          Income taxes are provided in accordance with SFAS No. 109,  Accounting
          for Income Taxes.  Under the provisions of SFAS No. 109,  deferred tax
          assets and liabilities  are recorded based on the differences  between
          the financial  statement and tax bases of assets and  liabilities  and
          the tax rates  which  will be in effect  when  these  differences  are
          expected to reverse.  If appropriate,  deferred tax assets are reduced
          by a valuation allowance, which reflects expectations of the extent to
          which such assets will be realized.  The Company and its  subsidiaries
          filed  individual  income tax  returns in prior  years but will file a
          consolidated return for the current year.

          Financial Instruments
          Off-balance sheet instruments.  In the ordinary course of business the
          Bank  has  entered  into  off-balance   sheet  financial   instruments
          consisting of  commitments to extend  credit,  and standby  letters of
          credit.  Such  financial  instruments  are  recorded in the  financial
          statements when they are funded.

          Fair Values of Financial Instruments
          The  following  methods and  assumptions  were used by the entities in
          estimating fair values of financial instruments as disclosed herein:

          Cash and  short-term  instruments.  The  carrying  amounts of cash and
          short-term instruments approximate fair values.

          Available-for-sale  and held-to-maturity  securities.  Fair values for
          securities,  excluding  restricted  equity  securities,  are  based on
          quoted  market  prices.  The  carrying  values  of  restricted  equity
          securities approximate fair values.

          Loans receivable.  For variable-rate loans that reprice frequently and
          have no  significant  change in credit risk,  fair values are based on
          carrying-values.  Fair  values for  mortgage  loans,  consumer  loans,
          commercial  real  estate  and  commercial  loans are  estimated  using
          discounted  cash flow analysis,  using interest rates  currently being
          offered for loans with similar  terms to  borrowers of similar  credit
          quality. Fair values for impaired loans are estimated using discounted
          cash flow analysis or underlying collateral values, where applicable.

          Deposit  Liabilities.  The fair values  disclosed for demand  deposits
          are,  by  definition,  equal to the  amount  payable  on demand at the
          reporting  date.  The carrying  amounts of  variable-rate,  fixed-term
          money market accounts and  certificates  of deposit (CDs)  approximate
          their fair values at the reporting  date.  Fair values for  fixed-rate
          CDs are  estimated  using a  discounted  cash  flow  calculation  that
          applies  interest rates  currently  being offered on certificates to a
          schedule of aggregated expected monthly maturities on time deposits.

          Advances from Federal Home Loan Bank. The fair values are based on the
          borrowing rates and remaining maturities.

                                       22
<PAGE>
                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -1   OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

          Cash Equivalents
          For the purpose of  reporting  cash flows,  cash and cash  equivalents
          include  cash on hand,  amounts due from banks,  and  interest-bearing
          deposits  at other  institutions.  The  Company  considers  all highly
          liquid debt  instruments  with original  maturities of three months or
          less to be cash equivalents

          Earnings Per Share
          The Company adopted Financial Accounting Standards Board Statement No.
          128  relating to  earnings  per share.  The  statement  requires  dual
          presentations  of basic and diluted  earnings per share on the face of
          the income  statement.  Basic EPS excludes dilution and is computed by
          dividing   income   available   to   common    stockholders   by   the
          weighted-average  number of common shares  outstanding for the period.
          Diluted  EPS  reflects  the  potential  dilution  that could  occur if
          securities or other  contracts to issue common stock were exercised or
          converted  into common  stock or  resulted  in the  issuance of common
          stock that then shares in the earnings of the entity.

          Stock Compensation Plan
          Statement of Financial  Accounting Standards (SFAS) No. 123 Accounting
          for Stock-Based Compensation,  encourages all entities to adopt a fair
          value based  method of  accounting  for  employee  stock  compensation
          plans,  whereby  compensation cost is measured at the grant date based
          on the value of the award and is recognized  over the service  period,
          which is usually the vesting period. However, it also allows an entity
          to  continue  to measure  compensation  cost for those plans using the
          intrinsic  value based method of  accounting  prescribed by Accounting
          Principles  Board  Opinion  No.  25,  Accounting  for Stock  Issued to
          Employees,  whereby  compensation  cost is the excess,  if any, of the
          quoted  market  price  of  the  stock  at the  grant  date  (or  other
          measurement  date) over the amount an employee must pay to acquire the
          stock.  Stock options issued under the plan have no intrinsic value at
          the grant  date,  and under  Opinion  No. 25 no  compensation  cost is
          recognized  for them.  The Company  has  elected to continue  with the
          accounting  methodology  in  Opinion  No.  25 and,  as a  result,  has
          provided  pro forma  disclosures  of net income and earnings per share
          and other disclosures, as if the fair value based method of accounting
          had been applied.

          Advertising Costs
          Advertising costs are charged to expense as incurred.

NOTE -2   SECURITIES
          Securities are classified in categories and accounted for as follows:

          Mortgage-Backed Securities Held-to-Maturity
          The  amortized  cost  and  estimated  fair  value  of  mortgage-backed
          held-to-maturity securities at June 30, 2002 and 2001 are as follows:
<TABLE>
<CAPTION>
                                                                     Gross            Gross
                                                 Amortized        Unrealized       Unrealized         Fair
                 2002                              Cost              Gains           Losses           Value
                 ----                            ---------        ----------       ----------         -----
             <S>                                 <C>               <C>             <C>             <C>
             Mortgage-backed securities
                GNMA certificates                $ 7,506,205       $  10,197       $  (28,943)     $ 7,487,459
                FHLMC certificates                 1,989,034          22,673           (5,998)       2,005,709
                FNMA certificates                    811,697          15,431              (38)         827,090
                                                 -----------       ---------       ----------      -----------
                                                 $10,306,936       $  48,301       $  (34,979)     $10,320,258
                                                 ===========       =========       ==========      ===========
</TABLE>

                                       23
<PAGE>

                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -2      SECURITIES (Continued)
<TABLE>
<CAPTION>
                                                                     Gross            Gross
                                                 Amortized        Unrealized       Unrealized         Fair
                 2001                              Cost              Gains           Losses           Value
                 ----                            ---------        ----------       ----------         -----
             <S>                                 <C>               <C>             <C>             <C>
             Mortgage-backed securities
                GNMA certificates                $  627,745        $  12,387        $      0        $  640,132
                FHLMC certificates                  370,551            5,345          (5,696)          370,200
                FNMA certificates                 1,222,613           17,951               0         1,240,564
                                                 ----------        ---------        --------        ----------
                                                 $2,220,909        $  35,683        $ (5,696)       $2,250,896
                                                 ==========        =========        ========        ==========
</TABLE>

          Expected maturities on the mortgage backed securities will differ from
          contractual maturities because borrowers may have the right to call or
          prepay obligations with or without call or prepayment penalties.

          Securities Held-to-Maturity
          The  amortized  cost and  estimated  fair  value  of  held-to-maturity
          securities are as follows:
<TABLE>
<CAPTION>
                                                                     Gross            Gross
                                                 Amortized        Unrealized       Unrealized         Fair
                 2002                              Cost              Gains           Losses           Value
                 ----                            ---------        ----------       ----------         -----
             <S>                                 <C>               <C>             <C>              <C>
             Chaffee County
                 Bonds                           $ 303,039         $  7,247        $     0          $ 310,286
                                                 =========         ========        =======          =========
</TABLE>

          The amortized cost and fair value of debt securities  held-to-maturity
          by contractual maturity at June 30, 2002 follows:
<TABLE>
<CAPTION>
                                                                                     Amortized           Fair
                                                                                       Cost              Value
                                                                                     ---------           -----
                <S>                                                                   <C>              <C>
                Over 1 year through 5 years                                           $ 201,664        $ 206,198
                After 5 years                                                           101,375          104,088
                                                                                      ---------        ---------
                                                                                      $ 303,039        $ 310,286
                                                                                      =========        =========
</TABLE>

          At June 30, investments with a carrying value of $3,855,122 (2002) and
          $1,808,760  (2001) were pledged as  collateral  for deposits of public
          funds.

NOTE -3   LOANS RECEIVABLE
          Loans receivable at June 30, are summarized as follows
<TABLE>
<CAPTION>
                                                                        2002                2001
                                                                   -------------      -------------
<S>                                                                <C>                <C>
             Loans secured by real estate:
                One-to-four family residences                      $  59,167,162      $  62,163,878
                Commercial real estate                                35,549,596         29,562,996
                Construction                                           9,411,762          9,059,977
                Land                                                  11,243,700          8,677,500
                                                                   -------------      -------------
                Total Loans Secured by Real Estate                   115,372,220        109,464,351

             Consumer loans, net of discounts                         13,676,535         14,597,005
             Loans collateralized by savings accounts                    767,298            740,310
             Commercial loans                                         18,610,505         16,064,527
             Other loans                                                  59,427             50,317
                                                                   -------------      -------------
                Total Loans                                          148,485,985        140,916,510

             Less:
                Undisbursed portion of loans in process                3,194,636          3,026,054
                Deferred loan origination fees                           610,997            626,181
                Allowance for loan losses                              1,485,223          1,347,957
                                                                   -------------      -------------
                Loans Receivable, Net                              $ 143,195,129      $ 135,916,318
                                                                   =============      =============
</TABLE>
                                       24
<PAGE>

                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -3   LOANS RECEIVABLE (Continued)
          The changes in the allowance for loan losses were as follows:
<TABLE>
<CAPTION>
                                                              2002                2001
                                                          ------------        -----------
<S>                                                       <C>                 <C>
             Balance, beginning of year                   $  1,347,957        $ 1,002,760
             Provision for losses                              236,000            385,000
             Recoveries                                          6,240              1,027
             Losses incurred                                  (104,974)           (40,830)
                                                          ------------        -----------
             Balance, end of year                         $  1,485,223        $ 1,347,957
                                                          ============        ===========
</TABLE>

          Overdrafts  in demand  deposit  accounts in the amount of $24,649 have
          been reclassified as consumer loans for 2002.

          At  June  30,  the  Bank  had   adjustable   interest  rate  loans  of
          approximately $18,890,000 (2002) and $6,878,000 (2001). The adjustable
          rate loans have interest rate adjustment limitations and are generally
          indexed to the 1-year U.S.  Treasury  Note rate or prime rate.  Future
          market  factors  may  affect  the  correlation  of the  interest  rate
          adjustment with the rate the Bank pays on the short-term deposits that
          have been primarily utilized to fund these loans.

          As of  June  30,  2002,  $2,016,927  of  loans  had  been  pledged  as
          collateral for deposits of public funds.

          Loans receivable at June 30 include loans to officers and directors of
          approximately  $1,018,289 (2002) and $1,338,000  (2001).  For the year
          ended June 30, 2002,  $1,056,000 of new loans was made and payments of
          $824,000 were received and two loans of $529,000 were sold.

NOTE -4   LOAN SERVICING
          Mortgage   loans   serviced   for  others  are  not  included  in  the
          accompanying  statements of financial condition.  The unpaid principal
          balances of these loans at June 30 are summarized as follows:
<TABLE>
<CAPTION>
                                                         2002          2001
                                                      ----------    ----------
<S>                                                   <C>           <C>
          Mortgage loan portfolios serviced for:
             FHLMC                                    $2,893,075    $3,635,591
                                                      ==========    ==========
</TABLE>

          In  connection  with these loans  serviced  for others at June 30, the
          Bank held borrowers'  escrow balances of $(12,417) in 2002 and $456 in
          2001.

NOTE -5   ACCRUED INTEREST RECEIVABLE
          Interest receivable at June 30, relates to the following:
<TABLE>
<CAPTION>
                                                         2002          2001
                                                      ----------    ----------
<S>                                                   <C>           <C>
             Loans                                     $1,248,797    $1,105,226
             Mortgage-backed securities                    49,658        16,186
             Other investments                                886             0
                                                       ----------    ----------
                                                       $1,299,341    $1,121,412
                                                       ==========    ==========
</TABLE>

NOTE -6   PROPERTY AND EQUIPMENT
          Property and equipment  and the related  accumulated  depreciation  at
          June 30, are summarized as follows:
<TABLE>
<CAPTION>
                                                         2002          2001
                                                      ----------    ----------
<S>                                                   <C>           <C>

             Land and improvements                    $   599,098    $   584,132
             Buildings and improvements                 5,121,019      5,009,917
             Furniture, fixtures and equipment          2,122,178      2,085,341
             Construction in progress                           0         12,000
                                                      -----------    -----------
                                                        7,842,295      7,691,390
             Less accumulated depreciation             (1,772,607)    (1,579,483)
                                                      -----------    -----------
                                                      $ 6,069,688    $ 6,111,907
                                                      ===========    ===========
</TABLE>

          Depreciation  expense  for the years ended June 30,  totaled  $442,898
          (2002) and $398,647 (2001).

                                       25
<PAGE>
                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -7      DEPOSIT ACCOUNTS
             Deposit accounts at June 30 are summarized as follows:
<TABLE>
<CAPTION>
                                                                      2002                   2001
                                                            ---------------------     ---------------------
                                                                     Weighted               Weighted
                                                                     Average                Average
                                                            ---------------------     ---------------------
                                                                Amount       Rate       Amount       Rate
                                                                ------       ----       ------       ----
             <S>                                            <C>               <C>     <C>             <C>
             NOW accounts, including
                non-interest bearing
                deposits of $7,331,000 (2002)
                and $6,738,274 (2001)                       $  30,063,429     .64%    $  25,874,424   1.13%
             Money market and
                savings accounts                               28,274,752    1.37%       23,065,825   2.95%
             Certificate accounts                              57,803,865    4.27%       49,576,979   5.83%
                                                            -------------             -------------
                                                            $ 116,142,046             $  98,517,228
                                                            =============             =============
</TABLE>

          At June  30,  2002,  scheduled  maturities  of the  above  certificate
          accounts are summarized as follows:
<TABLE>
<CAPTION>
                                                  Year ending June 30,
                           --------------------------------------------------------------------------
                                                                                          2007 and
                                 2003           2004           2005            2006       thereafter
                           -------------    -----------    -----------     -----------    ----------
             <S>              <C>             <C>               <C>        <C>            <C>
             1.01-2.00     $  1,116,365
             2.01-3.00       13,791,840     $   295,679    $    40,335
             3.01-4.00        6,478,686       4,542,985         96,985     $   142,871    $   51,582
             4.01-5.00       11,030,021       2,007,704        110,594         218,657       737,264
             5.01-6.00        6,778,314       1,046,940        694,306         448,205        81,256
             6.01-7.00        4,751,825         440,665        309,383         532,006       197,707
             7.01-8.00          700,774         311,521        346,414         502,981
                           ------------     -----------    -----------     -----------    ----------
                           $ 44,647,825     $ 8,645,494    $ 1,598,017     $ 1,844,720    $1,067,809
                           ============     ===========    ===========     ===========    ==========
</TABLE>

          The  aggregate  amount  of  certificates  of  deposits  with a minimum
          denomination  of  $100,000  at  June  30 was  $18,324,452  (2002)  and
          $13,899,773 (2001).

          Deposits  in  excess  of  $100,000  are  not  insured  by the  Savings
          Association Insurance Fund (SAIF).

          Interest expense on deposits for the years ended June 30 is summarized
          as follows:
<TABLE>
<CAPTION>
                                                                                  2002           2001
                                                                             ------------    ------------
             <S>                                                             <C>             <C>
             NOW accounts                                                    $    196,167    $    253,240
             Money market and savings accounts                                    510,334         689,816
             Certificate accounts                                               2,781,870       2,719,762
                                                                             ------------    ------------
                                                                             $  3,488,371    $  3,662,818
                                                                             ============    ============
</TABLE>

NOTE -8   ADVANCES FROM FEDERAL HOME LOAN BANK

          Advances  from  the  Federal  Home  Loan  Bank  (FHLB)  at June 30 are
          summarized as follows:
<TABLE>
<CAPTION>
                                                             Interest
                                                                Rate                  2002               2001
                                                             ----------          ------------       ------------
             <S>                                             <C>                 <C>                <C>
             Maturing within one year                        5.49-7.05%          $  9,666,665       $  4,500,000
             Maturing in 2004                                5.14-6.91%             7,500,000          9,999,999
             Maturing in 2005                                4.18-7.34%             6,000,000          7,500,000
             Maturing in 2006                                5.54-6.98%             3,500,000          5,500,000
             Maturing in 2007                                4.97-5.31%             3,000,000          3,500,000
             Maturing after 2007                             5.37-6.10%            12,975,000         13,125,000
                                                                                 ------------       ------------
                                                                                   42,641,665         44,124,999
             Line of credit                                       7.28%                     0                  0
                                                                                 ------------       ------------
                                                                                 $ 42,641,665       $ 44,124,999
                                                                                 ============       ============
</TABLE>
                                       26
<PAGE>

                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -8   ADVANCES FROM FEDERAL HOME LOAN BANK (Continued)

          Pursuant to collateral  agreements with the FHLB, advances are secured
          by a blanket  pledge  agreement with the FHLB,  which includes  single
          family and commercial real estate loans.


          At June 30, 2002,  the Bank has an approved line of credit  subject to
          the maximum  amount of credit  available  to the Bank under the FHLB's
          credit policies,  which expires April 25, 2003. No amount was drawn on
          the line of credit at June 30, 2002 or 2001.

NOTE -9   INCOME TAXES
          The provision for income taxes consists of the following:
<TABLE>
<CAPTION>
                                             2002          2001
                                        ------------    ----------
             <S>                        <C>             <C>
             Current                    $  1,046,749    $  926,582
             Deferred                        (20,300)     (116,500)
                                        ------------    ----------
                                        $  1,026,449    $  810,082
                                        ============    ==========
</TABLE>
          The  effective  tax rate on income  before the  provisions  for income
          taxes  differs from the federal  statutory  income tax rate of 34% for
          the following reasons:
<TABLE>
<CAPTION>
                                                                                 2002                2001
                                                                             ----------           --------
             <S>                                                             <C>                  <C>
             Provision for income taxes at statutory rate                    $  917,248           $708,000
             Nondeductible expenses for tax purposes                             39,981             32,000
             State income taxes, net of federal income
               tax benefit                                                       68,143             68,300
             Other, net                                                           1,077              1,782
                                                                             ----------           --------
                                                                             $1,026,449           $810,082
                                                                             ==========           ========

             Effective tax rates                                                38%                 39%
</TABLE>
          Deferred  income  taxes  reflect  the net  tax  effects  of  temporary
          differences between the carrying amounts of assets and liabilities for
          financial  reporting  purposes  and the  amounts  used for  income tax
          purposes.  The net deferred tax assets (liabilities) as of June 30 are
          as follows:
<TABLE>
<CAPTION>
                                                                                 2002                2001
                                                                             -----------          ---------
             <S>                                                             <C>                  <C>
             Difference between tax basis and
             carrying basis of FHLB stock                                    $  (196,600)         $(196,600)
             Tax depreciation in excess of
             Financial statement amounts                                        (129,200)          (101,100)
             Difference between tax basis and carrying
             basis of long term incentive plan                                   129,200            134,000
             Other                                                                (6,800)            (2,400)
             Loan loss allowance                                                 386,500            328,900
                                                                             -----------          ---------
                      Net deferred tax asset                                 $   183,100          $ 162,800
                                                                             ===========          =========
</TABLE>
          Management has determined that a valuation allowance is not required.

                                       27
<PAGE>
                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -9   INCOME TAXES (Continued)

          The deferred tax expense (benefit) results from timing  differences in
          the recognition of income and expense for tax and financial  purposes.
          The sources and tax effects of these temporary timing  differences are
          as follows:
<TABLE>
<CAPTION>
                                                           2002             2001
                                                        ---------       ----------
<S>                                                     <C>             <C>
             Accumulated depreciation                   $  28,100       $   17,100
             Allowance for loan losses - net              (57,600)        (127,100)
             Other                                          4,400            2,100
             Long-term incentive plan                       4,800           (8,600)
                                                        ---------       ----------
                                                        $ (20,300)      $ (116,500)
                                                        =========       ==========
</TABLE>

          The Bank was in prior years permitted under the Internal  Revenue Code
          to deduct an annual  addition to reserve for bad debts in  determining
          taxable  income,  subject  to  certain  limitations.   This  deduction
          differed from the bad debt  provision  used for  financial  accounting
          purposes.  Bad debt deductions for income tax purposes are included in
          taxable  income of later  years  only if the bad debt  reserve is used
          subsequently  for  purposes  other  than to  absorb  bad debt  losses.
          Because the Bank does not intend to use the reserve for purposes other
          than to absorb  losses,  no deferred  income taxes have been provided.
          Retained earnings at June 30, 2002, include approximately  $1,169,000,
          representing  such bad debt  deductions for which no income taxes have
          been provided.

NOTE -10  REGULATORY CAPITAL REQUIREMENTS
          The  Bank  is  subject  to  various  regulatory  capital  requirements
          administered by the federal banking agencies.  Failure to meet minimum
          capital  requirements can initiate certain actions by regulators that,
          if  undertaken,  could  have a direct  material  effect on the  Bank's
          financial  statements.  Under  capital  adequacy  guidelines  and  the
          regulatory  framework for prompt corrective action, the Bank must meet
          specific guidelines that involve  quantitative  measures of the Bank's
          assets, liabilities, and certain off-balance sheet items as calculated
          under regulatory accounting practices.  The Bank's 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 Bank to maintain  minimum  amounts and ratios as
          outlined  below.  Management  believes,  as of June 30, 2002. The Bank
          meets all capital adequacy requirements to which it is subject.

          As of September 17, 2001, the most recent  notification from Office of
          Thrift Supervision  categorized the Bank as well capitalized under the
          regulatory   framework  for  prompt  corrective  action.  To  be  well
          capitalized the Bank must maintain  minimum total  risk-based,  Tier I
          risk-based,  and Tier I leverage  ratios.  There are no  conditions or
          events since that notification  that management  believes have changed
          the institution's category.

          The following is a reconciliation of capital computed under accounting
          principles   generally   accepted  in  the  United  States  (GAAP)  to
          regulatory   capital.   OTS   regulations   specify   minimum  capital
          requirements for the Bank. The following  reconciliation also compares
          the  capital   requirements   as  computed  to  the  minimum   capital
          requirements for the Bank, as of June 30.
<TABLE>
<CAPTION>
                                                                   2002            2001
                                                             -------------    ------------
             <S>                                             <C>              <C>
             Equity Per GAAP                                 $  16,034,000    $ 14,196,000
             Less Servicing Rights Plus Valuations                  (1,000)         (1,000)
                                                             -------------    ------------
             Equity Per GAAP- Tier I Capital                    16,033,000      14,195,000
             Valuation Allowance                                 1,485,000       1,348,000
                                                             -------------    ------------
             Regulatory Capital                              $  17,518,000    $ 15,543,000
                                                             =============    ============
</TABLE>

                                       28
<PAGE>

                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -10     REGULATORY CAPITAL REQUIREMENTS (Continued)
<TABLE>
<CAPTION>
                                                              Minimum Required     To Be Well Capitalized
                                                                 For Capital       Under Prompt Corrective
                                         Actual               Adequacy Purposes      Action Regulations
                                   Amount        Ratio        Amount     Ratio       Amount        Ratio
                                   ------        -----        ------     -----       ------        -----
              <S>               <C>             <C>         <C>          <C>        <C>            <C>
              2002
              ----
              Total Capital
                 (to Risk
                 Weighted
                 Assets)         $17,518,000    13.66%      $10,261,000   8.00%       $12,826,000  10.00%

              Tier I Capital
                 (to Risk
                 Weighted
                 Assets)          16,033,000    12.50         3,848,000   3.00          7,695,000   6.00

              Tier I Capital
                 (to Average
                 Assets)          16,033,000     9.45         2,545,000   1.50          8,484,000   5.00

              Tangible Capital
                 (to Tangible
                 Assets)          16,033,000     9.06         2,653,000   1.50           N/A

             2001
             ----
              Total Capital
                 (to Risk
                 Weighted
                 Assets)         $15,543,000    13.05%      $ 9,531,000   8.00%       $11,914,000  10.00%

              Tier I Capital
                 (to Risk
                 Weighted
                 Assets)          14,195,000    11.91         3,574,000   3.00          7,148,000   6.00

              Tier I Capital
                 (to Average
                 Assets)          14,195,000     9.42         2,261,000   1.50          7,537,000   5.00

              Tangible Capital
                 (to Tangible
                 Assets)          14,195,000     8.78         2,426,000   1.50           N/A
</TABLE>

          The Bank's  management  believes that, under the current  regulations,
          the Bank will continue to meet its minimum capital requirements in the
          coming year.  However,  events beyond the control of the Bank, such as
          increased  interest  rates or a downturn  in the economy in the Bank's
          operating   area,   could   adversely   affect  future  earnings  and,
          consequently,  the  ability  of the  Bank to meet its  future  minimum
          capital requirements.


                                       29
<PAGE>
                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -11  BENEFIT PLANS

          The Bank adopted a Long-Term Incentive Plan covering the directors and
          key  employees of the Bank.  On June 30 of each year the  participants
          will  have  a  contribution   made  to  their  account  providing  the
          participant continues to be an employee or director of the Bank. Prior
          to  distribution  under  the  terms of the  Plan,  each  participant's
          account  shall  be  credited  with a rate of  return,  on any  amounts
          previously credited, equal to the highest rate of interest paid by the
          Bank on one-year certificates of deposit, or after conversion the rate
          of  return  will  equal  the  dividend-adjusted  rate of return on the
          common stock.

          Amounts credited to  Participant's  Accounts on the effective date and
          thereafter  shall be fully vested.  Account balances shall be paid, in
          cash,  in ten equal  annual  installments  beginning  during the first
          quarter of the calendar  year which next follows the calendar  year in
          which the  participant  ceases to be a director  or  employee  for any
          reason,  with  subsequent  payments  being made by the last day of the
          first quarter of each  subsequent  calendar year until the participant
          has received the entire  amount of his  account.  Notwithstanding  the
          foregoing a participant may elect to have his account paid in lump sum
          distribution  or in annual payments over a period less than ten years.
          Any  benefits  accrued  under the plan  will be paid  from the  Bank's
          general  assets.  The  Bank has  established  a trust in order to hold
          assets with which to pay benefits. Trust assets, which are included in
          the consolidated statement of financial condition,  will be subject to
          the claims of the Bank's general  creditors.  The expense for the plan
          recognized  for the years ended June 30, 2002 and 2001 was $72,000 and
          $32,987.

          As part of the  conversion to stock,  the Bank  established an ESOP to
          benefit substantially all employees. The ESOP purchased 105,800 shares
          of common stock in the conversion  with proceeds  received from a loan
          from the  Company.  The note is to be repaid in ten  annual  principal
          installments of $105,800, starting June 30, 1998. Interest is based on
          the Wall  Street  Journal  Prime  plus one  percent,  and is  adjusted
          annually  on July 1.  The  interest  rate  for  2002  was  7.75%.  The
          unallocated shares of stock held by the ESOP are pledged as collateral
          on the debt. The ESOP is funded by  contributions  made by the Bank in
          amounts  sufficient  to retire the debt. At June 30, 2002 and June 30,
          2001, the outstanding  balance of the note receivable was $521,065 and
          $626,865 and is presented as a reduction of stockholders' equity. ESOP
          compensation  expense  for the years  ended June 30, 2002 and 2001 was
          $123,317 and $146,768.

          In  November  1993,  the  AICPA  issued  Statement  of  Position  93-6
          "Employers'  Accounting  for  Employee  Stock  Ownership  Plans."  The
          statement  was adopted  December 9, 1997,  the  effective  date of the
          Association's  conversion to a stock company.  The Statement requires,
          among other things, that: (1) for ESOP shares committed to be released
          in  a  period  to  compensate  employees  directly,  employers  should
          recognize  compensation  cost  equal to the  average  fair  value  (as
          determined on a monthly basis) of the shares committed to be released,
          (2) dividends on  unallocated  shares used to repay ESOP loans are not
          considered  dividends for financial reporting  purposes,  dividends on
          allocated  or  committed  shares are  credited to the  accounts of the
          participants  and reported as dividends in the  financial  statements,
          (3) for an internally  leveraged  ESOP, the Company's loan  receivable
          and the ESOP note  payable as well as the interest  income/expense  is
          not reflected in the  consolidated  financial  statements  and (4) for
          earnings per share computations,  ESOP shares that have been committed
          to be released should be considered outstanding. ESOP shares that have
          not  been   committed  to  be  released   should  not  be   considered
          outstanding.

          The ESOP shares as of June 30, 2002 are as follows:
             Shares released                                             42,320
             Shares committed to be released for allocation              10,580
             Unreleased shares                                           52,900
                                                                     ----------
             Total ESOP shares                                          105,800
                                                                     ==========
             Fair value of unreleased shares                         $1,007,745
                                                                     ==========

                                       30
<PAGE>

                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -11  BENEFIT PLANS (Continued

          The  board  of  directors   of  the  Company   approved  a  Management
          Recognition  Plan ("MRP") for  directors  and  employees.  The MRP was
          approved by the  stockholders  at the annual meeting in December 1998.
          The Company  purchased in the open market  39,675 shares of its common
          stock, at a cost of $551,721,  to fund the MRP. Under the terms of the
          plan  33,836  shares of common  stock were  awarded to  directors  and
          employees.  The  shares  awarded  pursuant  to the MRP have a  vesting
          schedule,   which  provides  that  25%  of  the  shares  awarded  will
          automatically  vest on the  effective  date of the  award and 25% will
          vest on each subsequent anniversary date. Compensation expense related
          to the MRP was $73,651 and  $132,897 for the years ended June 30, 2002
          and 2001.

          The bank also has a  noncontributory  401(K) plan which  employees may
          elect to join after 90 days of employment.

NOTE -12  FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND CONCENTRATIONS
          OF CREDIT 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.  At June 30, 2002,  the Bank has  commitments  to fund
          mortgage loans of $2,406,000, with interest rates from 4.75% to 9.50%,
          unfunded  lines of  credit of  $7,092,000,  and  letters  of credit of
          $250,000.  The Bank makes  contractual  commitments  to extend credit,
          which are legally  binding  agreements  to lend money to  customers at
          prevailing  interest  rates for specified  periods of time. The credit
          risk involved in issuing these  commitments is essentially the same as
          that involved in extending loan facilities to customers.

          As  such,  the  Bank's  exposure  to  credit  loss,  in the  event  of
          non-performance  by the counterparty to the financial  instrument,  is
          represented by the contractual amount of those  instruments.  However,
          the Bank applies the same credit standards used in the lending process
          when extending  these  commitments,  and  periodically  reassesses the
          customers' credit  worthiness.  Additional risks associated with these
          commitments  arise when they are drawn  upon,  such as the  demands on
          liquidity that the Bank could experience if a significant portion were
          drawn  down  at  once.  This  is  considered  unlikely,   however,  as
          commitments may expire without having been drawn upon.

          The Bank  originates  loans  primarily  in  Chaffee,  Fremont and Lake
          Counties,   Colorado.   Although  the  Bank  has  a  diversified  loan
          portfolio,  a substantial  portion of its borrower's  ability to repay
          their loans is dependent upon economic conditions in the market area.

NOTE -13  FAIR VALUES OF FINANCIAL INSTRUMENTS
          The estimated fair values of the financial instruments are as follows:
<TABLE>
<CAPTION>
                                                          2002                             2001
                                             Carrying           Fair            Carrying           Fair
                                              Amount            Value            Amount            Value
                                             --------           -----           --------           -----
             <S>                            <C>             <C>               <C>            <C>
             Financial Assets:
             Cash                           $  2,873,502    $   2,873,502     $  2,759,671   $   2,759,671
             Interest-bearing deposits         8,590,443        8,590,443        9,175,856       9,175,856
             Mortgage backed securities       10,306,936       10,320,258        2,220,909       2,250,896
             Securities held to maturity         303,039          310,286                0               0
             FHLB stock                        2,421,600        2,421,600        2,421,600       2,421,600
             Loans receivable - net          143,837,129      151,123,000      136,833,818     143,175,000

             Financial liabilities
             Deposits                        116,142,046      117,113,000       98,517,228      99,311,000
             Advances from FHLB               42,641,665       44,869,000       44,124,999      44,989,000

</TABLE>

                                       31
<PAGE>
                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -14     OTHER NON-INTEREST EXPENSE
<TABLE>
<CAPTION>
                                                                                 2002          2001
                                                                             ----------    ---------
             <S>                                                             <C>           <C>
             Advertising                                                     $   92,850    $  78,798
             Stationery Supplies                                                164,180      150,612
             Postage                                                            127,020      102,142
             Telephone                                                           67,925       59,692
             Dues and Subscriptions                                              45,935       43,867
             Community Support                                                   53,656       48,416
             Bank Charges                                                        35,197       42,857
             Other                                                              100,864      121,691
                                                                             ----------    ---------
                                                                             $  687,627    $ 648,075
                                                                             ==========    =========
</TABLE>
NOTE - 15    STOCKHOLDERS' EQUITY

          In the years  ended  June 30,  2002 and 2001,  the  Company  purchased
          123,583 and 42,233 shares of its common stock, at a cost of $1,986,832
          and  $607,162,  and  retired  the stock in  accordance  with  Colorado
          Revised Statutes

          For the years  ended June 30, 2002 and 2001,  the Company  paid a cash
          dividend of $.50 per share respectively.

NOTE - 16 STOCK OPTION PLAN

          The  stockholders  approved the adoption of the 1998  incentive  stock
          option plan, providing for the award of incentive stock options to key
          employees  and  directors of the Company,  and its  affiliates  at the
          discretion  of the  Board of  Directors.  Under  the terms of the plan
          116,376 shares of the Company's common stock were granted to employees
          and  directors  on December  17,  1998.  Such  options  have an option
          exercise  price of  $13.125,  which was the fair value of the stock at
          December 17, 1998. The aggregate number of shares deliverable pursuant
          to awards shall not exceed  145,475  shares.  Such stock  options will
          have a term of ten years and a vesting schedule, for employees,  which
          provides  that one  third of the  options,  vested  at the date of the
          grant and one third vested  January 1, 1999 and  one-third  January 1,
          2000. The directors' options vested at the date of the grant.

          The Company applies APB Opinion No. 25 and related  interpretations in
          accounting  for the stock option plan.  Accordingly,  no  compensation
          cost has been  recognized.  If the Company  had  elected to  recognize
          compensation  cost based on the fair value of the  options  granted at
          the grant date (1998) as  prescribed by SFAS 123, the effect would not
          have been material to net income or earnings per share.

          A  summary  of the  status  of the  Company's  stock  option  plan  is
          presented below:
<TABLE>
<CAPTION>
                                                    2002       2001
                                                   -------   --------
            <S>                                    <C>       <C>
            Outstanding at the beginning of year   116,376   116,376
            Granted                                      0         0
            Exercised                                    0         0
            Forfeited                                    0         0
            Outstanding at year end                116,376   116,376

            Options exercisable at year end        116,376   116,376
</TABLE>
          The  exercise  price for the  outstanding  options is $13.125  and the
          remaining contractual life is 6.6 years.

                                       32
<PAGE>
                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -16  IMPACT OF NEW ACCOUNTING STANDARDS

          In December 2001, the Accounting  Standards Executive Committee issued
          Statement of Position 01-06, Accounting by Certain Entities (Including
          Entities  With  Trade   Receivables)  That  Lend  to  or  Finance  the
          Activities  of  Others.   This  SOP   reconciles   and  conforms,   as
          appropriate,   the  accounting  and  financial  reporting   provisions
          established  by the BSI  Guide,  CU  Guide,  and FC  Guide.  This  SOP
          eliminates  differences in accounting  established by the Guides where
          such  differences  are not  warranted.  In  addition,  the SOP carries
          forward  accounting   guidance  for  transactions  unique  to  certain
          financial  entities.  Most of the  differences  between the respective
          guides represent presentation or disclosure  requirements.  The impact
          of adopting this SOP in December  2001 did not have a material  affect
          on the financial statements or the disclosures.

NOTE -17  CONTINGENCIES AND COMMITMENTS

          In the normal  course of  business,  the Bank is  involved  in various
          legal  actions  arising in the  ordinary  course of  business.  In the
          opinion of management,  after  consultation  with legal  counsel,  the
          ultimate  disposition  of  these  matters  is not  expected  to have a
          material adverse effect on the financial position of the Bank.

NOTE -18     CONDENSED FINANCIAL INFORMATION (PARENT COMPANY ONLY)

          The following condensed  statements  summarize the financial position,
          operating results and cash flows of High Country Bancorp, Inc.,
<TABLE>
<CAPTION>
                                                                                2002             2001
                                                                             ------------    ------------
<S>                                                                          <C>             <C>
             CONDENSED BALANCE SHEET
             ASSETS
                 Cash and equivalents                                        $    125,762    $  2,550,640
                 Investment in subsidiary                                      10,080,587       8,237,730
                 ESOP note receivable                                             521,065         626,865
                 Other                                                             82,918           2,307
                                                                             ------------    ------------

                                                                             $ 10,810,332    $ 11,417,542
                                                                             ============    ============

             LIABILITIES AND STOCKHOLDERS' EQUITY
                 Accruals                                                    $     37,447    $          0
                 Stockholders' equity                                          10,772,885      11,417,542
                                                                             ------------    ------------
                                                                             $ 10,810,332    $ 11,417,542
                                                                             ============    ============
             CONDENSED STATEMENT OF INCOME

             For the years ended June 30, 2002 and
             June 30, 2001
             Equity in undistributed net income of subsidiary                $  1,822,393    $  1,248,017
             Other net                                                           (153,314)         22,482
                                                                             ------------    ------------
                                                                             $  1,669,079    $  1,270,499
                                                                             ============    ============
</TABLE>

                                       33
<PAGE>

                           HIGH COUNTRY BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE -18     CONDENSED FINANCIAL INFORMATION (PARENT COMPANY ONLY)

<TABLE>
<CAPTION>
             CONDENSED STATEMENT OF CASH FLOWS

             For the years ended June 30, 2002 and
             June 30, 2001
<S>                                                                          <C>            <C>
             Operating Activities:
             Net income                                                      $ 1,669,079     $ 1,270,499
             Adjustments to reconcile net income to cash
             provided by operating activities:
             Equity in undistributed net income of
             subsidiary                                                       (1,822,393)     (1,248,017)
             Other                                                                34,633          27,970
                                                                             -----------     -----------
             Net cash provided by operations                                    (118,681)         50,452
                                                                             -----------     -----------
             Investing Activities:
             ESOP note payment                                                   105,800         105,800

             Loan (to) payment from subsidiary                                         0       3,000,000
             Dividends received                                                        0         200,000
                                                                             -----------     -----------
             Net cash provided by investing activities                           105,800       3,305,800
                                                                             -----------     -----------
             Financing Activities:
             Purchase of common stock                                         (1,986,832)       (607,162)
             Dividends paid                                                     (425,165)       (490,207)
                                                                             -----------     -----------
             Net cash provided (used)by financing activities                  (2,411,997)     (1,097,369)
                                                                             -----------     -----------
             Net increase (decrease) in cash                                  (2,424,878)      2,258,883

             Cash beginning                                                    2,550,640         291,757
                                                                             -----------     -----------
             Cash ending                                                     $   125,762     $ 2,550,640
                                                                             ===========     ===========
</TABLE>

                                       34
<PAGE>

                         MARKET AND DIVIDEND INFORMATION

TRADING IN THE COMMON STOCK AND DIVIDENDS PAID

     The Company's  Common Stock is traded on the Nasdaq  SmallCap  Market under
the symbol  "HCBC." As of September 16, 2002,  there were 905,409  shares of the
Common Stock issued and outstanding and  approximately  322 holders of record of
the Common Stock (not including shares held in "street name").

     The following  table sets forth certain  information as to the range of the
high and low bid prices for the Company's common stock for the calendar quarters
since the first quarter of fiscal 2001.
<TABLE>
<CAPTION>
                                            HIGH BID (1)      LOW BID (1)           DIVIDENDS PAID
                                            ------------      -----------           --------------
<S>                                         <C>                <C>                      <C>
     FISCAL 2001:
         First Quarter                      $  11.75           $ 11.00                  $  --
         Second Quarter                        14.00             11.31                    0.25
         Third Quarter                         15.50             13.25                     --
         Fourth Quarter                        15.53             15.00                    0.25

     FISCAL 2002:
         First Quarter                      $  17.00           $ 15.20                  $  --
         Second Quarter                        17.50             15.92                    0.25
         Third Quarter                         17.50             16.75                     --
         Fourth Quarter                        20.50             17.16                    0.25

<FN>
________

(1)  Quotations reflect inter-dealer price, without retail mark-up, mark-down or
     commissions, and may not represent actual transactions.
</FN>
</TABLE>

DIVIDEND RESTRICTIONS

     The payment of dividends will be subject to the  requirements of applicable
law and the  determination by the Board of Directors of the Company that the net
income,  capital and  financial  condition  of the Company and the Bank,  thrift
industry  trends  and  general  economic   conditions  justify  the  payment  of
dividends,  and there can be no  assurance  that  dividends  will be paid or, if
paid, will continue to be paid in the future.

     Since the Company initially has no significant  source of income other than
dividends  from the Bank,  principal  and interest  payments on the note payable
from  the  ESOP  and  earnings  from  investment  of the  cash  proceeds  of the
Conversion retained by the Company, the payment of dividends by the Company will
depend in large  part upon the  proceeds  from the  Conversion  retained  by the
Company and the Company's earnings thereon and the receipt of dividends from the
Bank, which is subject to various tax and regulatory restrictions on the payment
of  dividends.  Unlike  the Bank,  the  Company  is not  subject  to  regulatory
restrictions  on the payment of  dividends to  stockholders.  Under the Colorado
General  Corporation  Law,  dividends  may be paid  either out of surplus or, if
there is no  surplus,  out of net  profits  for the  fiscal  year in  which  the
dividend is declared and/or the preceding fiscal year.

                                       35
<PAGE>
<TABLE>
<CAPTION>
                                              BOARD OF DIRECTORS

<S>                                        <C>                                          <C>
LARRY D. SMITH                              PHILIP W. HARSH                             TIMOTHY R. GLENN
President and Chief Executive               Owner and Agent of Fredrickson Brown        Owner and Funeral Director of
Officer of the Company and                  Insurance Agency                            Lewis & Glenn Funeral Home
the Bank


SCOTT G. ERCHUL                             RICHARD A. YOUNG
Vice President of the Company               Partner of Swartz & Young, P.C.
and the Bank


                                              EXECUTIVE OFFICERS

LARRY D. SMITH                              SCOTT G. ERCHUL                             FRANK L. DELAY
President and Chief Executive Officer of    Vice President of the Company and the Bank  Chief Financial Officer of the
the Company and the Bank                                                                Company and the Bank


                                                  OFFICE LOCATIONS

MAIN OFFICE:                                BRANCH OFFICE:         BRANCH OFFICE:      BRANCH OFFICE:
7360 West US Highway 50                     130 West 2nd           600 Harrison        713 East Main
Salida, Colorado                            Salida, Colorado       Leadville,          Buena Vista, Colorado
                                            Colorado

                                                    GENERAL INFORMATION

INDEPENDENT PUBLIC ACCOUNTANTS              ANNUAL MEETING                              ANNUAL REPORT ON FORM 10-KSB
Grimsley, White & Company,                  The 2002 Annual Meeting of Stockholders     A copy of the Company's Annual Report
Certified Public Accountants                will be held on October 29, 2002 at 5:00    on Form 10-KSB for the fiscal year
La Junta, Colorado                          p.m. at High Country Bank, 7360 West US     ended June 30, 2002 as filed with the
                                            Highway 50, Salida, Colorado  81210         Securities and Exchange Commission
GENERAL COUNSEL                                                                         will be furnished without charge to
Rush and Rush, P.C.                         TRANSFER AGENT AND REGISTRAR                stockholders as of the record date
Salida, Colorado                            Illinois Stock Transfer                     for the 2002 Annual Meeting upon
                                            209 West Jackson Boulevard                  written request to Richard A. Young,
SPECIAL COUNSEL                             Suite 903                                   Secretary, High Country Bancorp,
Stradley Ronon Stevens &                    Chicago, Illinois  60606                    Inc., P.O. Box 1128, Salida,
   Young, LLP                               Phone: 1-800-757-5755                       Colorado  81201.
1220 19th Street, NW, Suite 700             Fax: 1-312-427-2879
Washington, DC  20036

</TABLE>