<PAGE>

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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                                  FORM 10-KSB

 (Mark One)
    [X]      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
             OF THE SECURITIES EXCHANGE ACT OF 1934

             FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001

                                   OR

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

             FOR THE TRANSITION PERIOD FROM           TO

                         COMMISSION FILE NUMBER 0-24891

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

                            ADMIRALTY BANCORP, INC.
             (Exact Name of Registrant as Specified in its Charter)

                DELAWARE                                         65-0405207
    (State or other jurisdiction of                           (I.R.S. Employer
     incorporation or organization)                         Identification No.)

          4400 PGA BOULEVARD,                                      33410
      PALM BEACH GARDENS, FLORIDA                                (Zip Code)
(Address of Principal Executive Offices)

                                 (561) 624-4701
               (ISSUER'S TELEPHONE NUMBER, INCLUDING AREA CODE.)
   (FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF CHANGED SINCE LAST
                                    REPORT)

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

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

    The aggregate market value of voting stock held by non-affiliates of the
Registrant as of January 25, 2002 was $83,628,830.

    For the fiscal year ended December 31, 2001, the Registrant had total
revenues of $31.6 million.

    As of February 15, 2002 there were 5,282,485 shares of Class B Common Stock
outstanding.

                       DOCUMENT INCORPORATED BY REFERENCE

<Table>
<Caption>
                         10-KSB ITEM                                 DOCUMENT INCORPORATED
                         -----------                                 ---------------------
<S>       <C>                                        <C>
Item 9.   Directors and Executive Officers of the    Proxy Statement for 2002 Annual Meeting of
          Company; Compliance with Section 16(a) of  Stockholders to be filed no later than April 26, 2002.
          the Exchange Act.
Item 10.  Executive Compensation                     Proxy Statement for 2002 Annual Meeting of
                                                     Stockholders to be filed no later than April 26, 2002.
Item 11.  Security Ownership of Certain Beneficial   Proxy Statement for 2002 Annual Meeting of
          Owners and Management                      Stockholders to be filed no later than April 26, 2002.
Item 12.  Certain Relationships and Related          Proxy Statement for 2002 Annual Meeting of
          Transactions                               Stockholders to be filed no later than April 26, 2002.
</Table>

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>

                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

  GENERAL

     Admiralty Bancorp, Inc. is a holding company for Admiralty Bank (the
"Bank") and Admiralty Insurance Services, LLC., (collectively, the "Company").
Admiralty Bancorp, Inc. is incorporated in the state of Delaware and is
registered with the Board of Governors of the Federal Reserve System (the "FRB")
as a financial holding company. The Bank is a Florida chartered commercial bank
and member of the Federal Reserve System. Its main office is in Palm Beach
Gardens, Florida, and it has branches in Altamonte Springs, Boca Raton, Cocoa
Beach, Fort Lauderdale, Juno Beach, Jupiter, Melbourne and Orlando, Florida. On
March 11, 2000, the Company converted from a one bank holding company to a
financial holding company under the Gramm-Leach-Bliley Financial Modernization
Act of 1999 (the "Modernization Act"). This status permits the Company to
undertake financial activities which need not be closely related to banking,
such as insurance brokerage activities. Under the Modernization Act, the
Company's bank subsidiary must remain "well capitalized" (i.e., have a leveraged
capital ratio of 5% or greater and a risk based capital ratio of 10% or greater)
and well managed, or the Company could be required to divest itself of its
non-banking activities. In addition, the Company must maintain a rating of
"satisfactory" or better under the Community Reinvestment Act. Our status as a
financial holding company also permits us to undertake certain activities
without prior Federal Reserve approval.

     The Company formed Admiralty Insurance Services, LLC ("AIS") as a joint
venture with USI Florida ("USI") to offer a wide range of insurance products,
primarily to customers of the Bank. USI and the Company are each 50 percent
owners of AIS. USI and AIS share equally in commissions on policies sold, and
the Company is entitled to 50 percent of the net income of AIS. Under the
agreement, USI Florida absorbs all costs incurred by AIS for operating expenses.
AIS did minimal business during the years ended December 31, 2001 and 2000; $66
thousand and $16 thousand in income was recognized during the respective
periods.

     We may also seek additional alliances with other financial service
providers as a way to enhance non-interest income.

     The Bank's deposits are insured by the Bank Insurance Fund ("BIF") of the
Federal Deposit Insurance Corporation ("FDIC") up to applicable limits. The
operations of the Bank are subject to the supervision and regulation of the FRB
and the Florida Department of Banking (the "Department"). The principal
executive offices of the Bank are located at 4400 PGA Boulevard, Palm Beach
Gardens, Florida 33410 and the telephone number is (561) 624-4701.

  BUSINESS OF THE COMPANY

     The Company conducts a traditional commercial banking business and offers
services including personal and business checking accounts and time deposits,
money market accounts and regular savings accounts. The Company structures its
specific services and charges in a manner designed to attract the business of
(i) small and medium-sized businesses, and the owners and managers of these
entities; (ii) professionals and middle managers of locally-based corporations;
and (iii) individuals residing, working and shopping in the Palm Beach, Broward,
Brevard, Orange, Osceola and Seminole Counties, Florida trade area serviced by
the Company. The Company engages in a wide range of lending activities and
offers commercial, consumer, residential and non-residential mortgage and
construction loans. In addition, through our AIS joint venture, we offer a wide
range of insurance products.

  SERVICE AREA

     The Company's service area primarily consists of Palm Beach, Broward,
Brevard, Orange, Osceola and Seminole Counties, Florida, although the Company
makes loans throughout Florida. The Company

                                        2
<PAGE>

operates through its main office in Palm Beach Gardens, Florida and branch
offices in Altamonte Springs, Boca Raton, Cocoa Beach, Fort Lauderdale, Juno
Beach, Jupiter, Melbourne and Orlando, Florida.

  COMPETITION

     The Company operates in a highly competitive environment competing for
deposits and loans with commercial banks, thrifts and other financial
institutions, many of which have greater financial resources than the Company.
Many large financial institutions compete for business in the Company's service
area. Certain of these institutions have significantly higher lending limits
than the Company and provide services to their customers which the Company does
not offer.

     Management believes the Company is able to compete favorably with its
competitors because it provides responsive personalized services through
management's knowledge and awareness of the Company's service area, customers
and business.

  EMPLOYEES

     At December 31, 2001, the Company employed 111 full-time employees and 11
part-time employees. None of these employees is covered by a collective
bargaining agreement and the Company believes that its employee relations are
good.

  SUPERVISION AND REGULATION

     Bank holding companies and banks are extensively regulated under both
federal and state law. These laws and regulations are intended to protect
depositors, not stockholders. To the extent that the following information
describes statutory and regulatory provisions, it is qualified in its entirety
by reference to the particular statutory and regulatory provisions. Any change
in the applicable law or Regulation may have a material effect on the business
and prospects of Admiralty Bancorp, Inc. and the Bank.

  BANK HOLDING COMPANY REGULATION

     As a financial holding company registered under the Bank Holding Company
Act (the "BHCA"), the Company is subject to the regulation and supervision of
the FRB. The Company is required to file with the FRB annual reports and other
information regarding its business operations and those of its subsidiary.

     The BHCA requires, among other things, that bank holding companies obtain
the prior approval of the FRB in any case where the bank holding company
proposes to (i) acquire all or substantially all of the assets of any other
bank, (ii) acquire direct or indirect ownership or control of more than 5% of
the outstanding voting stock of any bank (unless it owns a majority of such
Company's voting shares) or (iii) merge or consolidate with any other bank
holding company. The FRB will not approve any acquisition, merger, or
consolidation that would have a substantially anti-competitive effect, unless
the anti-competitive impact of the proposed transaction is clearly outweighed by
a greater public interest in meeting the convenience and needs of the community
to be served. The FRB also considers capital adequacy and other financial and
managerial resources and future prospects of the companies and the banks
concerned, together with the convenience and needs of the community to be
served, when reviewing acquisitions or mergers. In addition, bank holding
companies are prohibited, with certain limited exceptions, from (i) acquiring or
retaining direct or indirect ownership or control of more than 5% of the
outstanding voting stock of any company which is not a bank or bank holding
company, or (ii) engaging directly or indirectly in activities other than those
of banking, managing or controlling banks, or performing services for its
subsidiaries, unless such non-banking business is determined by the FRB to be so
closely related to banking or managing or controlling banks as to be properly
incident thereto.

     As discussed above, the Modernization Act substantially changed many
provisions of the BHCA, and provided new powers to bank holding companies that
elect to become financial holding companies. Financial holding companies are
permitted to engage in a broader range of non-banking activities, and are

                                        3
<PAGE>

permitted to engage in a variety of new activities, or undertake certain
acquisitions without prior FRB approval.

     There are a number of obligations and restrictions imposed on bank holding
companies and their depository institution subsidiaries by law and regulatory
policy that are designed to minimize potential loss to the depositors of such
depository institutions and the FDIC insurance funds in the event the depository
institution becomes in danger of default. Under a policy of the FRB with respect
to bank holding company operations, a bank holding company is required to serve
as a source of financial strength to its subsidiary depository institutions and
to commit resources to support such institutions in circumstances where it might
not do so absent such policy. The FRB also has the authority under the BHCA to
require a bank holding company to terminate any activity or to relinquish
control of a non-bank subsidiary upon the FRB's determination that such activity
or control constitutes a serious risk to the financial soundness and stability
of any bank subsidiary of the bank holding company.

     Capital Adequacy Guidelines For Bank Holding Companies.  The FRB maintains
risk-based capital guidelines for bank holding companies. The risk-based capital
guidelines are designed to make regulatory capital requirements more sensitive
to differences in risk profile among banks and bank holding companies, to
account for off-balance sheet exposure, and to minimize disincentives for
holding liquid assets. Under these guidelines, assets and off-balance sheet
items are assigned to broad risk categories each with appropriate weights. The
resulting capital ratios represent capital as a percentage of total
risk-weighted assets and off-balance sheet items. The risk-based guidelines
apply on a consolidated basis to bank holding companies with consolidated assets
of $150 million or more.

     The minimum ratio of total capital to risk-weighted assets (including
certain off-balance sheet activities, such as standby letters of credit) is 8%.
At least 4% of the total capital is required to be "Tier I Capital," consisting
of common stockholders' equity and qualifying preferred stock, less certain
goodwill items and other intangible assets. The remainder ("Tier II Capital")
may consist of (a) the allowance for loan losses of up to 1.25% of risk-weighted
assets, (b) non-qualifying preferred stock, (c) hybrid capital instruments, (d)
perpetual debt, (e) mandatory convertible securities, and (f) qualifying
subordinated debt and intermediate-term preferred stock up to 50% of Tier I
capital. Total capital is the sum of Tier I and Tier II capital less reciprocal
holdings of other banking organizations' capital instruments, investments in
unconsolidated subsidiaries and any other deductions as determined by the FRB
(determined on a case by case basis or as a matter of policy after formal
rule-making).

     Bank holding company assets are given risk-weights of 0%, 20%, 50% and
100%. In addition, certain off-balance sheet items are given similar credit
conversion factors to convert them to asset equivalent amounts to which an
appropriate risk-weight will apply. These computations result in the total risk-
weighted assets. Most loans are assigned to the 100% risk category, except for
performing first mortgage loans fully secured by residential property which
carry a 50% risk-weighting and loans secured by deposits in the Bank which carry
a 20% risk weighting. Most investment securities (including, primarily, general
obligation claims of states or other political subdivisions of the United
States) are assigned to the 20% category, except for municipal or state revenue
bonds, which have a 50% risk-weight, and direct obligations of the U.S. Treasury
or obligations backed by the full faith and credit of the U.S. Government, which
have a 0% risk-weight. In converting off-balance sheet items, direct credit
substitutes including general guarantees and standby letters of credit backing
financial obligations are given a 100% risk-weighting. Transaction-related
contingencies such as bid bonds, standby letters of credit backing nonfinancial
obligations, and undrawn commitments (including commercial credit lines with an
initial maturity of more than one year) have a 50% risk-weighting. Short term
commercial letters of credit have a 20% risk-weighting and certain short-term
unconditionally cancelable commitments have a 0% risk-weighting.

     In addition to the risk-based capital guidelines, the FRB has adopted a
minimum Tier I capital (leverage) ratio, under which a bank holding company must
maintain a minimum level of Tier I capital to average total consolidated assets
of at least 3% in the case of a bank holding company that has the highest
regulatory examination rating and is not contemplating significant growth or
expansion. All other bank

                                        4
<PAGE>

holding companies are expected to maintain a leverage ratio of at least 100 to
200 basis points above the stated minimum.

  BANK REGULATION

     As a Florida chartered commercial bank, the Bank is subject to the
regulation, supervision, and control of the Department. As a member of the
Federal Reserve System, the Bank is subject to regulation, supervision and
control of the FRB. As an FDIC-insured institution, the Bank is subject to
regulation, supervision and control of the FDIC, an agency of the federal
government. The regulations of the Federal Reserve, the FDIC and the Department
impact virtually all activities of the Bank, including the minimum level of
capital the Bank must maintain, the ability of the Bank to pay dividends, the
ability of the Bank to expand through new branches or acquisitions and various
other matters.

     Insurance of Deposits.  The deposits of the Bank are insured up to
applicable limits by the BIF of the FDIC. Accordingly, the Bank is subject to
deposit insurance assessments to maintain the BIF. Under the FDIC's insurance
premium assessment system, each institution is assigned to one of nine
assessment risk classifications based on its capital ratios and supervisory
evaluations. The lowest risk institutions do not pay any insurance premium,
while the highest risk institutions pay a premium assessed at the rate of 0.27%
of domestic deposits. Each institution's classification under the system is
re-examined semi-annually. In addition, the FDIC is authorized to increase or
decrease such rates on a semi-annual basis. In addition to insurance premium
assessments, under the Deposit Insurance Funds Act of 1996 (the "Deposit Act"),
commercial banks like the Bank are required to pay a portion of the interest and
principal owed on bonds issued by the Federal Financing Corporation ("FICO") to
assist the thrift bailout in the mid-1980's. BIF insured commercial banks like
the Bank are assessed 1.82 basis points of their assessed deposits in
satisfaction of this FICO payment, in addition to deposit insurance premiums.

     Dividend Rights.  Pursuant to the provisions of the Florida Banking Code, a
Florida state chartered bank may quarterly, semi-annually or annually declare a
dividend out of the Company's net profits for the dividend period and retained
net profits from the preceding two years. In addition, with the approval of the
Florida Department of Banking and Finance, a bank may declare a dividend from
retained profits which have accrued in periods prior to the preceding two years,
provided that in this circumstance the bank must make an addition to its surplus
fund equal to at least 20% of its net profits from the preceding period. No
Florida state chartered bank may declare a dividend if it has incurred a loss
for its current period plus the two preceding years, or which would cause the
capital account of the bank to fall below the minimum amount required by law or
regulation.

ITEM 2.  DESCRIPTION OF PROPERTY

     The Bank leases its main office in Palm Beach Gardens and its branch
offices in Boca Raton, Cocoa Beach, Fort Lauderdale, Juno Beach, Jupiter,
Melbourne and Orlando, Florida. The Bank owns the real estate upon which it
operates its Altamonte Springs branch in a leased modular building. The Bank is
in the process of constructing a free standing, full service branch on the
property. The new facility is expected to be opened in or about August 2002. The
Bank currently has a contract to sell the portion of the property on which the
modular building is located. The sale of that property is expected to close in
June 2002 after which the Bank retains the right to operate its temporary office
on the site until the

                                        5
<PAGE>

permanent office is certified for occupancy. In addition, the Bank maintains an
operations center in Lake Worth, Florida. The following table sets forth certain
information regarding these leases:

<Table>
<Caption>
LOCATION                               SQUARE FEET   MONTHLY RENTAL($)          TERM
--------                               -----------   -----------------   ------------------
<S>                                    <C>           <C>                 <C>
Altamonte Springs....................     2,170            1,738             March 15, 2002
Boca Raton...........................     5,000           13,022          November 30, 2008*
Cocoa Beach..........................     2,500            3,125           January 31, 2011
Fort Lauderdale......................     2,200            4,950         September 30, 2004
Juno Beach...........................     2,508            4,348          December 31, 2004
Jupiter..............................     4,067            8,785            August 31, 2008*
Lake Worth...........................     5,800            5,075             March 31, 2005
Melbourne............................     4,845            5,652           January 31, 2010
Orlando..............................     8,792           14,653           January 31, 2011
Palm Beach Gardens...................     7,930           17,182           October 31, 2003
South Orlando........................     2,857            7,142          February 28, 2011
</Table>

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

* These leases extend to ten year terms upon a change in control of the Company.

ITEM 3.  LEGAL PROCEEDINGS

     The Company is periodically party to or otherwise involved in legal
proceedings arising in the normal course of business, such as claims to enforce
liens, claims involving the making and servicing of real property loans, and
other issues incident to the business of the Company. Management does not
believe that there is any pending or threatened proceeding against the Company
which, if determined adversely, would have a material effect on the business or
financial position of the Company.

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

     No matters were submitted for a vote of the Registrant's stockholders
during the fourth quarter of fiscal 2001.

                                        6
<PAGE>

                                    PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     Beginning September 30, 1998, the Company's Class B common stock traded on
the NASDAQ National Market under the symbol "AAABB". During the second half of
2001 the Company's trading symbol was shortened to "AAAB". The following table
shows the high and low bid prices for the Class B common stock as reported on
the NASDAQ National Market for each quarter of the last two fiscal years. These
quotations reflect inter-dealer prices, without retail market, mark-down or
commission and may not represent actual transactions.

<Table>
<Caption>
                                                              HIGH     LOW
                                                              -----   -----
<S>                                                           <C>     <C>
1st Quarter 2000............................................   9.00    6.00
2nd Quarter 2000............................................   6.88    5.25
3rd Quarter 2000............................................   9.44    6.63
4th Quarter 2000............................................  10.63    3.06
1st Quarter 2001............................................  16.00    8.38
2nd Quarter 2001............................................  14.70   11.50
3rd Quarter 2001............................................  21.37   13.95
4th Quarter 2001............................................  23.00   16.45
</Table>

     The Company has not paid cash dividends and does not anticipate paying cash
dividends in the foreseeable future. In January 2000, the Company declared a
12.91% stock dividend on its Class B common stock. In October 2001, the Company
declared a 5% stock dividend on its Class B common stock.

     As of December 31, 2001, the Company no longer had Class A common stock
outstanding and had 211 record holders of our Class B Stock.

                                        7
<PAGE>

ITEM 6A.  SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA

     To assist in the review of the following management discussion and
analysis, the Company is presenting the following selected information regarding
the Company, which should be read in conjunction with the Company's consolidated
financial statements, including the notes thereto, and the Management's
Discussion and Analysis section hereof.

<Table>
<Caption>
                                                         AS OF OR FOR THE YEAR ENDED DECEMBER 31,
                                                        ------------------------------------------
                                                            2001           2000           1999
                                                        ------------   ------------   ------------
<S>                                                     <C>            <C>            <C>
INCOME STATEMENT DATA:
Interest and dividend income..........................  $    30,363    $    16,780    $     7,930
Interest expense......................................       14,709          7,965          2,448
                                                        -----------    -----------    -----------
Net interest and dividend income......................       15,654          8,815          5,482
Provision for loan losses.............................        2,528          1,442            525
                                                        -----------    -----------    -----------
Net interest and dividend income after provision for
  loan losses.........................................       13,126          7,373          4,957
Non-interest income...................................        1,234          1,044          1,075
Non-interest expense..................................       12,030          7,448          5,396
                                                        -----------    -----------    -----------
Income before income taxes............................        2,330            969            636
Income tax expense....................................          906            363            384
                                                        -----------    -----------    -----------
Net income............................................  $     1,424    $       606    $       252
                                                        ===========    ===========    ===========
PER COMMON SHARE DATA:
Net income -- basic/diluted...........................  $0.30/$0.28    $0.19/$0.19    $0.08/$0.08
Book value(1).........................................  $      8.19    $      7.29    $      6.33
BALANCE SHEET DATA:
Total assets..........................................  $   497,582    $   301,361    $   139,962
Total loans...........................................      395,301        221,010        100,857
Allowance for loan losses.............................       (4,844)        (2,381)        (1,017)
Investment securities(2)..............................       55,565         39,514         27,682
Goodwill, net.........................................        3,234          3,387          3,540
Deposits..............................................      449,144        261,315        110,273
Stockholders' equity..................................       43,286         28,718         19,574
SELECTED OPERATING RATIOS:
Return on average assets..............................         0.34%          0.30%          0.23%
Return on average common equity.......................         3.70%          2.92%          1.29%
Net interest margin...................................         3.94%          4.65%          5.64%
SELECTED CAPITAL AND ASSET QUALITY RATIOS:
Average equity/average assets.........................         9.21%         10.25%         18.02%
Non-accrual loans/total loans.........................         0.13%          0.18%          0.15%
Non-performing assets/total loans and other real
  estate owned........................................         0.24%          0.18%          0.26%
Allowance for loan losses/total loans.................         1.23%          1.08%          1.01%
Allowance for loan losses/non-performing assets.......       500.93%        592.29%        388.17%
Net charge-offs/average total loans...................         0.02%          0.05%          0.15%
</Table>

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

(1) Book value per common share calculated by dividing the aggregate outstanding
    Class A common shares at a conversion ratio of one Class A share to 1.1291
    Class B shares and the Class B shares, adjusted for the 2001 stock dividend,
    into total stockholders' equity at the respective dates.

(2) Investment securities include Federal Reserve Bank stock and Federal Home
    Loan Bank stock.

                                        8
<PAGE>

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

  SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

     This report contains certain "forward-looking statements" as defined under
Section 21E of the Securities Exchange Act of 1934. The Company desires to take
advantage of the "safe harbor" provisions of Section 21E and is including this
statement for the express purpose of availing itself of the protection of the
safe harbor with respect to all such forward-looking statements. These
forward-looking statements, which are included in Management's Discussion and
Analysis, describe future plans or strategies and may include the Company's
expectations of future financial results. The words "believe", "expect",
"anticipate", "estimate", "project", and similar expressions identify
forward-looking statements. The Company's ability to predict results or the
effect of future plans or strategies or qualitative or quantitative changes
based on market risk exposure is inherently uncertain. Factors which could
effect actual results include but are not limited to i) changes in general
market interest rates, ii) general economic conditions, both in the United
States generally and in the Company's market area, iii) legislative/regulatory
changes, iv) monetary and fiscal policies of the U.S. Treasury and the Federal
Reserve, v) changes in the quality or composition of the Company's loan and
investment portfolios, vi) demand for loan products, vii) deposit flows, viii)
competition, and ix) demand for financial services in the Company's markets.
These factors should be considered in evaluating the forward-looking statements,
and undue reliance should not be placed on such statements.

  OVERVIEW

     For the year ended December 31, 2001 the Company generated net income of
$1.4 million or $0.30 per share and $0.28 per share basic and diluted,
respectively, compared to net income of $606 thousand, or $0.19 per share both
basic and diluted in 2000.

     At December 31, 2001, the Company's total assets reached $497.6 million, an
increase of 65.1% over total assets at December 31, 2000. The Company's net
loans totaled $390.5 million, an increase of 78.6% over net loans at December
31, 2000 and the Company's deposits totaled $449.1 million, an increase of 71.9%
over total deposits at December 31, 2000. The increases are generally due to the
Company's continued successful penetration and expansion of its service area,
both through its management team and through its new office locations.

 RESULTS OF OPERATIONS

     The Company's results of operations depend primarily on its net interest
income, which is the difference between the interest earned on its
interest-earning assets and the interest paid on funds borrowed to support those
assets, such as deposits. Net interest margin is a function of the difference
between the weighted average rate received on interest-earning assets and the
weighted average rate paid on interest-bearing liabilities, as well as the
average level of interest-bearing assets as compared with that of
interest-bearing liabilities. Net income is also affected by the amount of
non-interest income and operating expenses.

  NET INCOME

     For the year ended December 31, 2001, the Company produced a net profit of
$1.4 million, an increase of $818 thousand from net income of $606 thousand for
the year ended December 31, 2000. The period to period increase in reported net
income is attributable to an increase in the Company's net interest income
partially offset by an increase in non-interest expenses as the Company incurred
costs to enhance the value of its franchise.

  Interest Income

     Total interest income increased $13.6 million, or 81.0%, to $30.4 million
for the year ended December 31, 2001 from $16.8 million in 2000. This increase
in interest income primarily relates to an

                                        9
<PAGE>

increase in the Company's average balance of earning assets, partially offset by
a reduction in the average rate being earned on these assets to 7.7% from 8.9%
resulting from lower market interest rates. Average balances increased by $174.8
million for loans, $15.5 million for investment securities, $180 thousand for
interest bearing due from banks and $17.0 million for federal funds sold. The
average yield on the loan portfolio decreased to 8.2% from 9.5%, the average
yield on investment securities, including Federal Reserve Bank and FHLB stock,
decreased to 6.5% from 7.0%, the average yield on interest bearing due from bank
accounts decreased to 4.3% from 6.0% and the average yield on federal funds sold
decreased to 3.6% from 6.5% in 2001 as compared to 2000, reflecting lower market
rates of interest. During 2001, as the Company's asset mix continued to shift
toward a greater percentage of loans newly originated in the current rate
environment, the Company's yield on interest earning assets decreased to 7.7%
from the 8.9% earned during 2000.

  Interest Expense

     The Company's interest expense for the year ended December 31, 2001,
increased $6.7 million, or 84.7%, to $14.7 million from $8.0 million for 2000.
The increase in interest expense reflects a 121.6% increase in average interest
bearing liabilities during 2001 coupled with a decrease in the average rate paid
on interest bearing liabilities to 4.5% from 5.4%, resulting from lower market
interest rates. The average balance of time deposits, money market deposits and
NOW deposits increased by $130.4 million, $47.9 million and $8.5 million,
respectively, in 2001, as compared to 2000. The increase in money market deposit
accounts reflects the success of our tiered-rate money market account which
offers competitive rates based upon the size of the customer's account balance.
During 2001 the average rate paid by the Company on its time deposits decreased
to 5.4% from 6.5% in 2000 and the average rate paid on money market accounts
decreased to 3.5% from 5.0% in 2000. The Company subscribes to a deposit listing
service on the internet which allows it to post time deposit rates on a web site
which is available to other subscribers who use the site as an information
source for investing in time deposits. The deposits raised through this program
are primarily deposits of credit unions, savings banks and commercial banks at
terms from ninety days to three years. The Company raised a net of $72.0 million
with this program in 2001. At December 31, 2001 the Company had $106.1 million
in deposits raised through this program compared to $34.1 million in such
deposits at December 31, 2000. The weighted average rate of the internet deposit
portfolio at December 31, 2001 was 3.85% and the weighted average contractual
life was 9.0 months. In addition, the average balance of the Company's
non-interest bearing demand deposits increased by $18.4 million, to $51.1
million, from $32.7 million at December 31, 2000. The average balance of the
Company's repurchase agreement was $5.3 million at an average cost of 6.4% in
2001 compared to $8.4 million at an average cost of 6.3% in 2000. The average
balance of the FHLB borrowing was $2.0 million at an average cost of 5.1% in
2001 compared to $6.1 million at an average cost of 6.6% in 2000. The repurchase
agreement and FHLB borrowing were part of a leveraged interest rate risk
reduction strategy in which the Company used the funds to purchase government
agency securities. The effect of the changes to the Company's deposit portfolio,
the repurchase agreement and FHLB borrowing was to decrease the Company's
average cost of interest bearing liabilities to 4.5% for 2001 compared to 5.4%
in 2000.

  Net-Interest Income

     Net interest income increased by $6.8 million, or 77.6%, over 2000. The
Company's net interest spread decreased 32 basis points to 3.2% for 2001 from
3.5% in 2000. The Company's net yield on interest earning assets decreased to
3.9% in 2001 from 4.7% in 2000.

  COMPARATIVE AVERAGE BALANCE SHEETS

     The following table reflects the components of the Company's net interest
income, setting forth for the periods presented herein, (1) average assets,
liabilities and stockholders' equity, (2) interest income earned on
interest-earning assets and interest expense paid on interest-bearing
liabilities, (3) average yields earned on interest-earning assets and average
rates paid on interest-bearing liabilities, (4) the Company's

                                        10
<PAGE>

net interest spread (i.e., the average yield on interest-earnings assets less
the average rate on interest-bearing liabilities) and (5) the Company's net
yield on interest-earning assets. Rates are computed on a tax equivalent basis.

<Table>
<Caption>
                                                                YEAR ENDED DECEMBER 31,
                             ---------------------------------------------------------------------------------------------
                                         2001                            2000                            1999
                             -----------------------------   -----------------------------   -----------------------------
                                                   AVERAGE                         AVERAGE                         AVERAGE
                                        INTEREST    RATES               INTEREST    RATES               INTEREST    RATES
                             AVERAGE    INCOME/    EARNED/   AVERAGE    INCOME/    EARNED/   AVERAGE    INCOME/    EARNED/
                             BALANCE    EXPENSE     PAID     BALANCE    EXPENSE     PAID     BALANCE    EXPENSE     PAID
                             --------   --------   -------   --------   --------   -------   --------   --------   -------
                                                                (DOLLARS IN THOUSANDS)
<S>                          <C>        <C>        <C>       <C>        <C>        <C>       <C>        <C>        <C>
ASSETS
Interest earning assets:
Due from banks.............  $    395   $    17      4.3%    $    215   $    13      6.0%    $     14         1      5.1%
Loans......................   318,137    26,056      8.2%     143,352    13,645      9.5%      71,470     6,479      9.1%
Taxable investment
  securities(1)............    51,376     3,325      6.5%      35,914     2,504      7.0%      16,213       994      6.1%
Federal funds sold.........    26,514       965      3.6%       9,516       618      6.5%       9,425       456      4.8%
                             --------   -------              --------   -------              --------    ------
Total interest earning
  assets...................   396,422   $30,363      7.7%     188,997   $16,780      8.9%      97,122     7,930      8.2%
                                        -------                         -------                          ------
Non-interest earning
  assets...................    24,867                          14,565                          11,838
Allowance for possible loan
  losses...................    (3,385)                         (1,445)                           (743)
                             --------                        --------                        --------
    Total Assets...........  $417,904                        $202,117                        $108,217
                             ========                        ========                        ========
LIABILITIES AND
  STOCKHOLDERS' EQUITY
Interest-bearing
  liabilities:
NOW deposits...............  $ 21,084   $   133      0.6%    $ 12,544   $    88      0.7%      11,535        87      0.8%
Savings deposits...........     2,327        39      1.7%       2,296        46      2.0%       2,299        42      1.8%
Money market deposits......   101,740     3,619      3.6%      53,811     2,708      5.0%      26,108     1,074      4.1%
Time deposits..............   194,266    10,479      5.4%      63,912     4,165      6.5%      22,308     1,115      5.0%
Federal funds purchased....        --        --      0.0%         367        23      6.2%         291        17      5.8%
Repurchase agreements......     5,292       337      6.4%       8,415       528      6.3%       1,819       113      6.2%
FHLB borrowings............     1,988       102      5.1%       6,118       407      6.7%          --        --      0.0%
                             --------   -------              --------   -------              --------    ------
Total interest-bearing
  liabilities..............   326,697   $14,709      4.5%     147,463   $ 7,965      5.4%      64,360    $2,448      3.8%
                                        -------                         -------                          ------
Non-interest bearing
  liabilities:
Demand deposits............    51,083                          32,738                          23,823
Other liabilities..........     1,645                           1,192                             528
                             --------                        --------                        --------
Total non-interest bearing
  liabilities..............    52,728                          33,930                          24,351
                             --------                        --------                        --------
Stockholders' equity.......    38,479                          20,724                          19,506
                             --------                        --------                        --------
Total liabilities and
  stockholders' equity.....  $417,904                        $202,117                        $108,217
                             ========                        ========                        ========
Net interest
  differential.............                          3.2%                            3.5%                            4.4%
                                                     ===                             ===                             ===
Net yield on interest
  earning assets...........             $15,654      3.9%               $ 8,815      4.7%                $5,482      5.6%
                                        =======      ===                =======      ===                 ======      ===
</Table>

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

(1) Includes Federal Reserve Bank stock and Federal Home Loan Bank of Atlanta
    stock.

                                        11
<PAGE>

     The following table presents by category the major factors that contributed
to the changes in net interest income for the periods presented. Amounts have
been computed on a fully tax-equivalent basis.

<Table>
<Caption>
                                                               YEAR ENDED DECEMBER 31,
                                                                  2001 VERSUS 2000
                                                          ---------------------------------
                                                          INCREASE (DECREASE) DUE TO CHANGE
                                                                         IN:
                                                          ---------------------------------
                                                           AVERAGE     AVERAGE
                                                           VOLUME*      RATE         NET
                                                          ---------   ---------   ---------
                                                                   (IN THOUSANDS)
<S>                                                       <C>         <C>         <C>
INTEREST INCOME:
Due from banks..........................................   $     8     $    (4)    $     4
Loans...................................................    14,316      (1,905)     12,411
Taxable investment securities...........................     1,001        (180)        821
Federal funds sold......................................       619        (272)        347
                                                           -------     -------     -------
Total interest income...................................   $15,944     $(2,361)    $13,583
                                                           -------     -------     -------

INTEREST EXPENSE:
Federal funds purchased.................................   $    --     $   (23)    $   (23)
NOW deposits............................................        54          (9)         45
Money market deposits...................................     1,705        (794)        911
Savings.................................................         1          (8)         (7)
Time deposits...........................................     7,031        (717)      6,314
Repurchase agreements...................................      (199)          8        (191)
FHLB borrowings.........................................      (212)        (93)       (305)
                                                           -------     -------     -------
Total interest expense..................................   $ 8,380     $(1,636)    $ 6,744
                                                           -------     -------     -------
Net interest income.....................................   $ 7,564     $  (725)    $ 6,839
                                                           =======     =======     =======
</Table>

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

* Change in rate/volume is combined with change in volume.

  Provision for Loan Losses

     The increase in the provision for loan losses for 2001 to $2.5 million from
$1.4 million in 2000 is reflective of the significant growth in the loan
portfolio during 2001 as compared to the prior year. The Company's provision for
loan losses maintained the reserve at a level management believes appropriate in
light of the Company's lending activities, the quality of the loan portfolio,
historical experience, volume and type of lending conducted by the Company, the
status of past due and nonperforming loans, the general economic conditions of
the Company's lending area and other factors affecting collectibility of the
Company's loan portfolio. The Company had net charge-offs of $65 thousand and
did not experience any material change in its level of classified loans during
2001. While the Company's management uses available information to recognize
losses on loans, future additions to the allowance may be necessary based on
changes in economic conditions, the financial status of borrowers and regulatory
requirements.

  Non-Interest Income

     Total non-interest income increased $190 thousand, or 18.2%, from last
year. The components of non-interest income include a $185 thousand increase in
service charges and fees (including a $52 thousand increase in service charges
on deposit accounts) and a $50 thousand increase in insurance commissions.
Non-interest income also includes a $17 thousand reduction in gain on sale of
securities and a $25 thousand reduction in gain on sale of other real estate
since the Company did not sell any of these assets during 2001.

                                        12
<PAGE>

  Non-Interest Expense

     The Company's non-interest expense for 2001 increased over non-interest
expense for 2000. For 2001, the Company's total non-interest expense was $12.0
million, compared to total non-interest expense of $7.4 million for 2000. The
increase in non-interest expense reflects increased compensation and employee
benefit expense as the Company hired management and staff for the South Orlando
and Cocoa Beach facilities in the spring of 2001 and management and staff for
the Altamonte Springs and Fort Lauderdale region in the summer and fall of 2001.
Additionally, the Company added staff to its deposit operations, loan operations
and information systems departments to manage the growing volume of the Bank
during 2001. Salary and benefits expenses for 2001 include $175 thousand for the
South Orlando office, $160 thousand for the Altamonte Springs office and $132
thousand for the Fort Lauderdale office which the Company did not have in 2000.
Salary and benefit expenses also include increases of $757 thousand for the
downtown Orlando office which opened in the fall of 2000, $166 thousand for the
management and staff of the Cocoa Beach office and $706 thousand for additional
staff and annual raises for the administrative management and staff. Full time
equivalent employees increased from 85 at December 31, 2000 to 111 at December
31, 2001, reflecting increases necessary both to administer the Company's
growing loan and deposit portfolios and to staff the South Orlando, Cocoa Beach,
Fort Lauderdale and Altamonte Springs offices.

     In the fourth quarter of 2001, the Company changed certain of its
compensation policies. The effect of these changes should be to reduce certain
non-interest expenses in 2002. With regard to members of the Board of Directors,
the Company and the Bank ceased paying meeting fees and in lieu of these fees
entered into change in control bonus agreements with each member of the Board.
Under these agreements, each member of the Board who remains a member of the
Board at the effective time of a change in control will receive a bonus of
$36,000, except for Mr. Bruce Mahon, the Chairman, who will receive $108,000.
With regard to members of senior management, the Company has suspended its bonus
program, and has ceased accruing bonus expense. In lieu of year end bonuses, the
Company has established a change in control program for members of senior
management.

     The Company incurred an increase in occupancy and furniture and equipment
expenses as the Company opened its seventh, eighth, ninth and tenth offices, in
South Orlando, Cocoa Beach, Altamonte Springs and Fort Lauderdale and moved from
a temporary location to the permanent facility for its Downtown Orlando office.
Goodwill amortization totaled $153 thousand for both 2001 and 2000. However, due
to changes in accounting rules, the Company anticipates that it will not incur
this expense in future years. See "Impact of New Accounting Standards". The
Company also experienced the following increases in other non-interest expenses
related primarily to its growth: telephone expense increased $63 thousand, or
40%, postage and freight increased $23 thousand, or 29%, waived check printing
fees increase $45 thousand, or 93%, stationery supplies and printing increased
$130 thousand, or 72%, audit expense increased $31 thousand, or 25%, business
development expenses increased $146 thousand, or 102%, charitable donations
increased $48 thousand, or 163%, data processing expenses increased $108
thousand, or 30%, directors' fees and expenses increased $83 thousand, or 81%,
FDIC and state assessments increased $93 thousand, or 153%, courier expenses
increased $38 thousand, or 99%, and amortization of the interest only strip
related to the sold portion of SBA loans increased $44 thousand, or 1,061% due
to loans paid off or placed on non-accrual during the year. The Company
experienced decreases in the following categories of non-interest expense: legal
expenses decreased $20 thousand, or 51%, ATM processing costs decreased $34
thousand, or 45%, other real estate expenses decreased $21 thousand, or 100%,
and other losses decreased $54 thousand, or 90%.

  Income Taxes

     Income tax expense increased to $906 thousand for 2001, from $363 thousand
for 2000, due primarily to higher taxable income generated by the Company. The
Company reversed $50 thousand and $75 thousand of the valuation allowance
against deferred taxes in 2001 and 2000 respectively. The reversals are due to
the increased core profitability of the Company. Non-deductible expenses for
goodwill amortization contributed to effective tax rate for the year of 39%.

                                        13
<PAGE>

     At December 31, 2001, the Company had unused net operating loss
carry-forwards of approximately $820 thousand for Federal and Florida Income Tax
purposes expiring through 2008. These loss carry-forwards reflect the maximum
benefit that can be obtained from the net operating losses due to limitation
under the Internal Revenue Code of 1986.

     FINANCIAL CONDITION -- DECEMBER 31, 2001 COMPARED TO DECEMBER 31, 2000

     At December 31, 2001, the Company's total assets were $497.6 million,
compared to $301.4 million at December 31, 2000. Increases in total assets
included increases of $171.8 million in net loans, $4.7 million in cash and due
from banks, $11.0 million in investment securities held to maturity, $4.3
million in investment securities held available for sale and $2.8 million in
premises and equipment. Total deposits were $449.1 million at December 31, 2001
compared to $261.3 million at December 31, 2000.

  Cash and Due From Banks

     At December 31, 2001, cash and due from banks increased $4.7 million.
Interest bearing due from banks decreased $690 thousand and federal funds sold
increased by $28 thousand from December 31, 2000. The increase in cash and due
from banks is primarily attributable to additional cash needs for the new
branches opened during the period and a larger volume of cash items related to
the larger deposit base.

  Loan Portfolio

     The $171.8 million increase in net loans is comprised primarily of $6.8
million in commercial loans, $149.9 million in non-residential real estate
loans, $5.4 million in residential real estate loans and $9.9 million in
construction loans. The increase is the result of the management team's efforts
to attract new business and expand relationships with existing customers.

     The Company's loan portfolio consists primarily of loans secured by real
estate, and, to a lesser extent, commercial and consumer loans. Real estate
loans consist of loans secured by commercial or residential real property and
loans for the construction of commercial or residential property. Consumer loans
are made for the purpose of financing the purchase of consumer goods, home
improvements, and other personal needs, and are generally secured by the
property being purchased.

     The Company's loans are primarily to businesses and individuals located in
Palm Beach, Broward, Brevard, Orange, Osceola and Seminole Counties, Florida.
The Company has not made loans to borrowers outside of the United States.
Commercial lending activities are focused primarily on lending to small business
borrowers. The Company believes that its strategy of customer service,
competitive rate structures and selective marketing have enabled the Company to
gain market entry to local loans. Bank mergers by larger banks competing with
the Company have also contributed to the Company's efforts to attract borrowers.

                                        14
<PAGE>

     The following schedule presents the components of loans, by type, as of
December 31, 2001, 2000 and 1999.

<Table>
<Caption>
                               DECEMBER 31, 2001    DECEMBER 31, 2000    DECEMBER 31, 1999
                               ------------------   ------------------   ------------------
                                AMOUNT    PERCENT    AMOUNT    PERCENT    AMOUNT    PERCENT
                               --------   -------   --------   -------   --------   -------
                                            (IN THOUSANDS, EXCEPT PERCENTAGES)
<S>                            <C>        <C>       <C>        <C>       <C>        <C>
Commercial and Industrial....  $ 49,846      13%    $ 43,006      19%    $ 20,380      20%
Real Estate Non-Residential
  Properties.................   297,850      75      147,996      67       61,416      60
Residential Properties.......    24,802       6       19,399       9       10,824      11
Construction.................    17,771       4        7,869       3        7,148       7
Consumer.....................     6,380       2        3,424       2        1,534       2
                               --------     ---     --------     ---     --------     ---
Gross loans..................  $396,649     100%     221,694     100%    $101,302     100%
less: net deferred fees......     1,348                  684                  445
                               --------             --------             --------
Total loans..................   395,301              221,010              100,857
less: allowance for loan
  losses.....................     4,844                2,381                1,017
                               --------             --------             --------
Net loans....................  $390,457             $218,629             $ 99,840
                               ========             ========             ========
</Table>

     The following table sets forth, in terms of interest rate sensitivity,
certain components of the Company's loan portfolio as well as its fixed and
adjustable rate loans within that portfolio at December 31, 2001.

<Table>
<Caption>
                                        WITHIN 1 YEAR   1 TO 5 YEARS   AFTER 5 YEARS    TOTAL
                                        -------------   ------------   -------------   -------
                                                            (IN THOUSANDS)
<S>                                     <C>             <C>            <C>             <C>
Commercial and Industrial.............     $34,021        $15,657          $168        $49,846
Construction Loans....................      15,819          1,952            --         17,771
                                           -------        -------          ----        -------
     Total(1).........................     $49,840        $17,609          $168        $67,617
                                           =======        =======          ====        =======
Fixed Rate Loans......................                                                 $10,833
Variable Rate Loans...................                                                  56,784
                                                                                       -------
     Total(1).........................                                                 $67,617
                                                                                       =======
</Table>

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

(1) Includes Commercial and Industrial and Construction loans only.

  Asset Quality

     The Company's principal earning assets are its loans. Inherent in the
lending function is the risk of the borrower's inability to repay their loan
under its existing terms. Risk elements include non-accrual loans, past due and
restructured loans, potential problem loans, loan concentrations and other real
estate owned.

     Non-performing assets include loans that are not accruing interest
(non-accrual loans) as a result of principal or interest being in default for a
period of 90 days or more. When a loan is placed on such non-accrual status, all
accumulated accrued interest receivable is reversed out of current period
income. Until the loan becomes current, any payments received from the borrower
are applied to outstanding principal until such time as management determines
that the financial condition of the borrower and other factors merit recognition
of such payments as interest. Despite this general policy, the Small Business
Administration does not allow lenders to place loans on non-accrual status.
Because of this, cash collected on past due Small Business Administration
guaranteed loans is applied to interest first and any amount collected above the
interest due is applied to principal. Income on the unguaranteed portion of
these loans retained in the Company's portfolio is recognized on a cash basis
when received.

                                        15
<PAGE>

     The Company attempts to minimize overall credit risk through loan
diversification and its loan approval procedures. The Company's due diligence
begins at the time a borrower and the Company begin to discuss the origination
of a loan. Documentation, including a borrower's credit history, materials
establishing the value and liquidity of potential collateral, the purpose of the
loan, the source and timing of the repayment of the loan, and other factors are
analyzed before a loan is submitted for approval. Loans made are also subject to
periodic review.

     During 2001, the Company's non-accrual loans increased by $122 thousand to
$524 thousand at December 31, 2001 from $402 thousand at December 31, 2000. The
2001 balance represents six loans, two of which were placed on non-accrual
during 2001 and the retained portion of four Small Business Administration loans
which have remained on non-accrual since 2000. All the loans are in various
stages of collection and the Company does not expect to incur a material loss on
the loans. The Company had no other real estate owned at December 31, 2001 or
2000. No property was taken in as other real estate during 2001. During January
2002 the Company took title to a restaurant property securing one of the
non-accrual Small Business Administration loans. Several parties have expressed
interest in acquiring the property and management does not expect to incur a
loss on the sale.

     The following table sets forth information concerning the Company's
non-performing assets as of the dates indicated:

                              NON-PERFORMING LOANS

<Table>
<Caption>
                                                                 DECEMBER 31,
                                                          ---------------------------
                                                           2001      2000      1999
                                                          -------   -------   -------
                                                            (DOLLARS IN THOUSANDS)
<S>                                                       <C>       <C>       <C>
Non-accrual loans.......................................  $   524   $   402   $   154
Other real estate owned.................................       --        --       108
                                                          -------   -------   -------
Total non-performing assets(1)..........................  $   524   $   402   $   262
                                                          =======   =======   =======
Non-accrual loans to total loans........................     0.13%     0.18%     0.15%
Non-performing assets to total assets...................     0.19%     0.13%     0.19%
Allowance for possible loan losses as a percentage of
  non-performing assets.................................   500.93%   592.29%   388.17%
</Table>

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

(1) Excludes loans past due 90 days or more and still accruing interest of $443
    thousand at December 31, 2001 and $41 thousand at December 31, 1999. No
    loans were 90 days or more past due and still accruing interest at December
    31, 2000.

     If the above described non-accruing loans had been current, the Company's
interest income would have increased by $39 thousand, $11 thousand and $8
thousand for the years ended December 31, 2001, 2000 and 1999 respectively.

     At December 31, 2001, 12% of the Company's loan portfolio was secured by
real estate improved with office buildings. Tenants in a variety of businesses
use the office buildings securing these loans. There were no other
concentrations of loans exceeding 10% of the Company's total loans at December
31, 2000 and there were no concentrations of loans exceeding 10% of the
Company's loans at December 31, 2000 or 1999. The Company had no foreign loans
for any period reported.

  Allowance for Loan Losses

     The Company attempts to maintain an allowance for loan losses at a
sufficient level to provide for potential losses in the loan portfolio. Loan
losses are charged directly to the allowance when they occur and any recovery is
credited to the allowance.

                                        16
<PAGE>

     Risks within the loan portfolio are analyzed on a continuous basis by the
Company's officers, by outside, independent loan review auditors and by the
Company's Directors Loan Committee. A risk system, consisting of multiple
grading categories, is utilized as an analytical tool to assess risk and
appropriate reserves. The Company segregates the loan portfolio for loan loss
purposes into segments based upon the underlying collateral. The Company
provides for a general allowance for losses inherent in the portfolio by the
collateral categories. General loss percentages are calculated based upon
historical analyses as well as estimates of the inherent losses which probably
exist as of the evaluation date even though they might not have been identified
by the more objective processes used. This is due to the risk of error and/or
inherent imprecision in the process. This portion of the allowance is
particularly subjective and requires judgments based on qualitative factors
which do not lend themselves to exact mathematical calculations such as: trends
in delinquencies and nonaccruals; migration trends in the portfolio; trends in
volume, terms, and portfolio mix; new credit products and/or changes in the
geographic distribution of those products; changes in lending policies and
procedures; loan review reports on the efficacy of the risk identification
process; changes in the outlook for local, regional and national economic
conditions; concentrations of credit; and peer group comparisons. Specific
allowances are provided in the event that the specific analysis on each
classified loan indicates that it is probable that the Bank will be unable to
collect all amounts due, both principal and interest, according to the
contractual terms of the loan agreement. The provision for loan loss is debited
or credited in order to state the allowance for loan losses to the required
level as determined above. Along with the risk system, management further
evaluates risk characteristics of the loan portfolio under current and
anticipated economic conditions and considers such factors as the financial
condition of the borrower, past and expected loss experience, and other factors
management feels deserve recognition in establishing an appropriate reserve.
These estimates are reviewed at least quarterly, and, as adjustments become
necessary, they are realized in the periods in which they become known.

     Additions to the allowance are made by provisions charged to expense and
the allowance is reduced by net charge-offs (i.e., loans judged to be
uncollectible and charged against the reserve, less any recoveries on such
loans). Although management attempts to maintain the allowance at a level deemed
adequate, future additions to the allowance may be necessary based upon changes
in market conditions. In addition, various regulatory agencies periodically
review the Company's allowance for loan losses. These agencies may require the
Company to make additional provisions based on their judgments about information
available to them at the time of their examination.

     The Company's allowance for possible loan losses totaled $4.8 million, $2.4
million and $1.0 million at December 31, 2001, 2000 and 1999, respectively.

                                        17
<PAGE>

     The following is a summary of the reconciliation of the allowance for loan
losses for the periods presented.

<Table>
<Caption>
                                                             YEAR ENDED DECEMBER 31,
                                                             ------------------------
                                                              2001     2000     1999
                                                             ------   ------   ------
                                                              (DOLLARS IN THOUSANDS)
<S>                                                          <C>      <C>      <C>
Balance at beginning of period.............................  $2,381   $1,017   $  602
CHARGE-OFFS
Real estate................................................      --       87       --
Instalment.................................................      15       --        1
Commercial.................................................      55       --      177
                                                             ------   ------   ------
     Total Charge-offs.....................................      70       87      178
RECOVERIES
Real estate................................................       1       --        4
Instalment.................................................      --       --       --
Commercial.................................................       4        9       64
                                                             ------   ------   ------
     Total Recoveries......................................       5        9       68
Net Charge-offs............................................      65       78      110
Provision charged to expense...............................   2,528    1,442      525
                                                             ------   ------   ------
Balance of allowance at end of period......................  $4,844   $2,381   $1,017
                                                             ======   ======   ======
Ratio of net charge-offs to average loans outstanding......    0.02%    0.05%    0.15%
Balance of allowance at period end as a percent of total
  loans at period end......................................    1.23%    1.08%    1.01%
</Table>

     The following table sets forth, for each of the Company's major lending
areas, the amount of the Company's allowance for loan losses attributable to
such category, and the percentage of total loans represented by such category,
as of the periods indicated:

            ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES BY CATEGORY

<Table>
<Caption>
                                                           DECEMBER 31,
                                ------------------------------------------------------------------
                                        2001                   2000                   1999
                                --------------------   --------------------   --------------------
                                            % OF                   % OF                   % OF
                                AMOUNT   TOTAL LOANS   AMOUNT   TOTAL LOANS   AMOUNT   TOTAL LOANS
                                ------   -----------   ------   -----------   ------   -----------
                                                      (DOLLARS IN THOUSANDS)
<S>                             <C>      <C>           <C>      <C>           <C>      <C>
Balance applicable to:
Commercial and industrial.....  $  882        13%      $  406        19%      $  175        20%
Real estate:
  Non-residential
     properties...............   2,341        75%       1,228        67%         596        60%
  Residential properties......     270         6%         209         9%          66        11%
  Construction................   1,007         4%         304         3%         134         7%
  Consumer....................      76         2%          42         2%          14         2%
                                ------       ---       ------       ---       ------       ---
Subtotal......................   4,576       100%       2,189       100%         985       100%
  Unallocated reserves........     268        --          192        --           32        --
                                ------       ---       ------       ---       ------       ---
     Total....................  $4,844       100%      $2,381       100%      $1,017       100%
                                ======       ===       ======       ===       ======       ===
</Table>

                                        18
<PAGE>

  Investment Portfolio

     The Company maintains an investment portfolio to fund increased loan demand
or decreased deposits and other liquidity needs and to provide an additional
source of interest income. The portfolio is composed primarily of obligations of
the U.S. Treasury, U.S. Government agencies and government sponsored entities.
The Bank also owns shares in the Bankers' Bancorporation of Florida, Inc. As a
Federal Reserve Member Bank, the Bank also holds stock in the Federal Reserve
Bank of Atlanta and, as a member of the Federal Home Loan Bank of Atlanta, the
Bank also owns Federal Home Loan Bank Stock. For purposes of the following
discussion, the Company does not consider the Federal Reserve Bank stock and
Federal Home Loan Bank stock to be investment securities.

     The Company classifies its investment securities as either held to
maturity, trading or available for sale. Investment securities are classified as
securities held to maturity based on management's intent and the Company's
ability to hold them to maturity. Such securities are stated at cost, adjusted
for unamortized purchase premiums and discounts. Securities that are bought and
held principally for the purpose of selling them in the near term are classified
as trading securities, which are carried at market value. Realized gains and
losses and gains and losses from marking the portfolio to market value are
included in trading revenue. Securities not classified as securities held to
maturity or trading securities are classified as securities available for sale,
and are stated at fair value. Unrealized gains and losses on securities
available for sale are excluded from results of operations, and are reported as
a separate component of comprehensive income in stockholders' equity, net of
taxes. Securities classified as available for sale include securities that may
be sold in response to changes in interest rates, changes in prepayment risks,
the need to increase regulatory capital or other similar requirement. Declines
in the fair value of individual held-to-maturity and available-for-sale
securities below their cost that are other than temporary result in write-downs
of the individual securities to their fair value with the related write-downs
included in earnings as realized losses.

     Management determines the appropriate classification of securities at the
time of purchase. At December 31, 2001 the Company had $18.0 million and $35.6
million of its investment portfolio classified as available for sale and held to
maturity, respectively. At December 31, 2000 the Company had $13.6 million and
$24.5 million of its investment portfolio classified as available for sale and
held to maturity, respectively.

     The $11.0 million increase in the investment held to maturity portfolio is
comprised of purchases of mortgage-backed securities and U.S. Treasury
securities to augment the overall portfolio as the Bank grows and other
mortgage-backed securities pay down.

     The $4.3 million increase in the investment available for sale portfolio is
comprised of the purchase of $15.5 million in mortgage-backed securities and $1
million in agency securities, to augment the overall portfolio as the Bank grows
and these and other mortgage-backed securities pay down. These purchases were
partially offset by $7.5 million of calls and maturities of agency securities
and $4.7 million in principal repayments on the mortgage-backed securities.

                                        19
<PAGE>

     A comparative summary of investment securities available for sale for the
periods presented is as follows (in thousands):

<Table>
<Caption>
                                                            GROSS        GROSS
                                              AMORTIZED   UNREALIZED   UNREALIZED    FAIR
AVAILABLE FOR SALE                              COST        GAINS        LOSSES      VALUE
------------------                            ---------   ----------   ----------   -------
<S>                                           <C>         <C>          <C>          <C>
December 31, 2001
U.S. Government and Agency Securities.......   $ 1,000       $ 29        $  --      $ 1,029
Mortgage-Backed Securities..................    16,800        144          (18)      16,926
Other Securities............................        14         --           --           14
                                               -------       ----        -----      -------
Total.......................................   $17,814       $173        $ (18)     $17,969
                                               =======       ====        =====      =======
December 31, 2000
U.S. Government and Agency Securities.......   $ 7,500       $  7        $ (30)     $ 7,477
Mortgage-Backed Securities..................     6,031        106           --        6,137
Other Securities............................        14         --           --           14
                                               -------       ----        -----      -------
Total.......................................   $13,545       $113        $ (30)     $13,628
                                               =======       ====        =====      =======
December 31, 1999
U.S. Government and Agency Securities.......   $ 6,997       $ --        $(218)     $ 6,779
Mortgage-Backed Securities..................     2,155         --          (63)       2,092
Other Securities............................        14         --           --           14
                                               -------       ----        -----      -------
Total.......................................   $ 9,166       $ --        $(281)     $ 8,885
                                               =======       ====        =====      =======
</Table>

     A comparative summary of investment securities held to maturity for the
periods presented is as follows (in thousands):

<Table>
<Caption>
                                                            GROSS        GROSS
                                              AMORTIZED   UNREALIZED   UNREALIZED    FAIR
HELD TO MATURITY                                COST        GAINS        LOSSES      VALUE
----------------                              ---------   ----------   ----------   -------
<S>                                           <C>         <C>          <C>          <C>
December 31, 2001
U.S. Treasury Securities....................   $ 2,037       $ --        $  (6)     $ 2,031
U.S. Government and Agency Securities.......     4,002         45           (8)       4,039
Mortgage-Backed Securities..................    29,550        489          (26)      30,013
                                               -------       ----        -----      -------
Total.......................................   $35,589       $534        $ (40)     $36,083
                                               =======       ====        =====      =======
December 31, 2000
U.S. Government and Agency Securities.......   $ 1,000       $  5        $  (1)     $ 1,004
Mortgage-Backed Securities..................    23,549        228           --       23,777
                                               -------       ----        -----      -------
Total.......................................   $24,549       $233        $  (1)     $24,781
                                               =======       ====        =====      =======
December 31, 1999
U.S. Government and Agency Securities.......   $ 1,000       $ --        $ (28)     $   972
Mortgage-Backed Securities..................    17,025         --         (276)      16,749
                                               -------       ----        -----      -------
Total.......................................   $18,025       $ --        $(304)     $17,721
                                               =======       ====        =====      =======
</Table>

                                        20
<PAGE>
     The following tables sets forth as of December 31, 2001, the maturity
distribution of the Company's investment portfolio.

                   MATURITY SCHEDULE OF INVESTMENT SECURITIES
<Table>
<Caption>
                                                          AFTER ONE BUT        AFTER FIVE BUT
                                    WITHIN ONE YEAR     WITHIN FIVE YEARS     WITHIN TEN YEARS
                                   ------------------   ------------------   ------------------
                                   CARRYING   AVERAGE   CARRYING   AVERAGE   CARRYING   AVERAGE
AVAILABLE FOR SALE                  VALUE      YIELD     VALUE      YIELD     VALUE      YIELD
------------------                 --------   -------   --------   -------   --------   -------
                                                      (DOLLARS IN THOUSANDS)
<S>                                <C>        <C>       <C>        <C>       <C>        <C>
U.S. Government & Agency
  Obligations....................   $    0     0.00%     $1,029     3.03%     $    0     0.00%
Mortgage-Backed Securities.......    8,300     5.44%      7,008     5.63%      1,227     6.23%
Other Securities.................        0     0.00%          0     0.00%          0     0.00%
                                    ------     ----      ------     ----      ------     ----
                                    $8,300     5.44%     $8,037     5.29%     $1,227     6.23%
                                    ======               ======               ======

<Caption>
                                    AFTER TEN YEARS           TOTAL
                                   ------------------   ------------------
                                   CARRYING   AVERAGE   CARRYING   AVERAGE
AVAILABLE FOR SALE                  VALUE      YIELD     VALUE      YIELD
------------------                 --------   -------   --------   -------
                                           (DOLLARS IN THOUSANDS)
<S>                                <C>        <C>       <C>        <C>
U.S. Government & Agency
  Obligations....................   $    0     0.00%    $ 1,029     3.03%
Mortgage-Backed Securities.......      391     6.23%     16,926     5.59%
Other Securities.................    2,021     6.05%      2,021     6.05%
                                    ------     ----     -------     ----
                                    $2,411     6.08%    $19,976     5.51%
                                    ======              =======
</Table>

     Mortgage-backed securities maturities are based on current prepayment
speeds as of most recent payment received.

     Other securities include Federal Reserve Bank stock of $1.3 million and
Federal Home Loan Bank stock of $741 thousand that the Bank must own as a
condition of membership. The Bank does not anticipate that it will discontinue
its memberships and, therefore, these stocks are classified as more than ten
years. Other securities also include $14 thousand in Bankers' Bancorporation of
Florida stock.
<Table>
<Caption>
                                                        AFTER ONE BUT      AFTER FIVE BUT WITHIN
                                  WITHIN ONE YEAR     WITHIN FIVE YEARS          TEN YEARS
                                 ------------------   ------------------   ---------------------
                                 CARRYING   AVERAGE   CARRYING   AVERAGE   CARRYING    AVERAGE
HELD TO MATURITY                  VALUE      YIELD     VALUE      YIELD     VALUE       YIELD
----------------                 --------   -------   --------   -------   --------   ----------
                                                     (DOLLARS IN THOUSANDS)
<S>                              <C>        <C>       <C>        <C>       <C>        <C>
U.S. Treasury securities.......  $     0     0.00%    $ 2,037     2.66%      $  0        0.00%
U.S. Government & Agency
  Obligations..................        0     0.00%      4,002     4.40%         0        0.00%
Mortgage-Backed Securities.....   17,742     6.53%     10,305     6.51%       762        6.27%
                                 -------              -------                ----
                                 $17,742     6.53%    $16,344     5.52%      $762        6.27%
                                 =======              =======                ====

<Caption>
                                  AFTER TEN YEARS           TOTAL
                                 ------------------   ------------------
                                 CARRYING   AVERAGE   CARRYING   AVERAGE
HELD TO MATURITY                  VALUE      YIELD     VALUE      YIELD
----------------                 --------   -------   --------   -------
                                         (DOLLARS IN THOUSANDS)
<S>                              <C>        <C>       <C>        <C>
U.S. Treasury securities.......    $  0      0.00%    $ 2,037     2.66%
U.S. Government & Agency
  Obligations..................       0      0.00%      4,002     4.40%
Mortgage-Backed Securities.....     741      6.04%     29,550     6.50%
                                   ----               -------
                                   $741      6.04%    $35,589     6.05%
                                   ====               =======
</Table>

     Mortgage-backed securities maturities are based on current prepayment
speeds as of most recent payment received.

     No available for sale securities were sold during 2001 or 1999. Proceeds
from the sales of securities available for sale during the year ended December
31, 2000 were $17 thousand. Securities pledged to secure public funds on deposit
and for other purposes required or permitted by law were $21.4 million, $28.1
million and $10.6 million at December 31, 2001, 2000 and 1999, respectively.

  Other Assets

     Accrued interest receivable increased $489 thousand as a result of growth
in the loan and investment portfolios partially offset by lower yields on these
assets. Federal Reserve Bank (FRB) stock and Federal Home Loan Bank (FHLB) stock
increased as the result of purchases of additional FRB stock in compliance with
the FRB membership requirements. The Company's net investment in premises and
equipment increased $2.8 million. The increase is comprised of $1.3 million
invested in land and build out for the Altamonte Springs office, $400 thousand
for the build out of the Cocoa Beach office, $232 thousand for the build out of
the Fort Lauderdale office, $338 thousand for the build out of the permanent
office in downtown Orlando and $570 thousand for the build out of the South
Orlando office, net of depreciation. The deferred tax asset increased $940
thousand because of timing differences in the Company's book income versus tax
income and due to a reversal of $50 thousand of the valuation allowance against
the asset.
                                        21
<PAGE>

  Deposits

     Deposits are the Company's primary source of funds. During 2001, the
Company's deposits increased by $187.8 million, or 71.9%, to $449.1 million at
December 31, 2001 from $261.3 million at December 31, 2000. During 2001, the
Company's deposit portfolio continued to shift toward time deposits and money
market accounts. This shift reflects the Company's efforts to attract deposits
to satisfy loan demand. Average demand deposits for the twelve months ended
December 31, 2001, and 2000 were $51.1 million and $32.7 million representing
13.8% and 19.8%, respectively, of average total deposits. Average money market
deposits were $101.7 million and $53.8 million representing 27.5% and 32.6% of
average total deposits in 2001 and 2000, respectively. Average time deposits
were $194.3 million and $63.9 million, representing 52.4% and 38.7%, of average
total deposits in 2001 and 2000, respectively. The Company's cost of deposits
for 2001 was 3.84%, compared to 4.24% for the year ended December 31, 2000.

     The Company subscribes to a deposit listing service on the internet which
allows it to post time deposit rates on an internet site which is available to
other subscribers who use the site as an information source for investing in
time deposits. The deposits raised through this program are primarily deposits
of credit unions, savings banks and commercial banks at terms from ninety days
to three years. The Company had $106.1 million in deposits raised through this
program at December 31, 2001 compared to $34.1 million at December 31, 2000,
accounting for a substantial portion of the overall growth in time deposits. The
weighted average rate of the internet deposit portfolio at December 31, 2001 was
3.85% and the weighted average contractual life was 9.0 months. The Company uses
this service as an alternative to offering promotional rates as a deposit
generating tool. Management believes that the rates paid through this listing
service are lower than the Company would be required to pay to generate a
similar amount of deposits in its local markets.

     The following table sets forth the average amounts of various types of
deposits for each of the periods indicated:

<Table>
<Caption>
                                                 YEAR ENDED DECEMBER 31,
                               -----------------------------------------------------------
                                      2001                 2000                1999
                               ------------------   ------------------   -----------------
                                          AVERAGE              AVERAGE             AVERAGE
                                AMOUNT     YIELD     AMOUNT     YIELD    AMOUNT     YIELD
                               --------   -------   --------   -------   -------   -------
                                                 (DOLLARS IN THOUSANDS)
<S>                            <C>        <C>       <C>        <C>       <C>       <C>
Non-Interest Bearing
  Demand.....................  $ 51,083     0.0%    $ 32,738     0.0%    $23,823     0.0%
Interest-Bearing Demand......    21,084     0.6%      12,544     0.7%     11,535     0.8%
Money Market Deposits........   101,740     3.5%      53,811     5.0%     26,108     4.1%
Savings Deposits.............     2,327     1.7%       2,296     2.0%      2,299     1.8%
Time Deposits................   194,266     5.4%      63,912     6.5%     22,308     5.0%
                               --------             --------             -------
Total........................  $370,500             $165,301             $86,073
                               ========             ========             =======
</Table>

     The Company does not actively solicit short-term deposits of $100,000 or
more in its local markets because of the liquidity risks posed by such deposits.
The following table summarizes the maturity distribution of certificates of
deposits of denominations of $100,000 or more as of December 31, 2001 (in
thousands):

<Table>
<S>                                                            <C>
Time deposits ($100,000 and over)
Three months or less........................................   $ 27,688
Over three months through six months........................     32,533
Over six months through twelve months.......................     50,484
Over twelve months..........................................      1,569
                                                               --------
     Total..................................................   $112,274
                                                               ========
</Table>

                                        22
<PAGE>

  Federal Funds Purchased and Securities Sold Under Agreement to Repurchase

     The Company had no federal funds purchased at December 31, 2001 or 2000.
The Company entered into a $9.0 million repurchase agreement during the fourth
quarter of 1999. The funds received in the repurchase transaction were used
toward the purchase of a $10.1 million, 20 year, FHLMC mortgage-backed security.
The borrowings under the repurchase agreement mature as follows: $3.1 million in
one year, $3.0 million in two years and $2.9 million in three years. The cost of
the one year borrowing was 6.04%, the two year borrowing was at 6.25% and the
third year borrowing is at 6.45%. At each maturity date management evaluates
whether to replace the borrowings or pay them off using Company funds. The $3.0
million borrowing that matured during 2001 was repaid out of funds raised in the
deposit portfolio.

  Other Borrowings

     The Company had $1.0 million dollars in Federal Home Loan Bank borrowings
at December 31, 2001. Originally the Company borrowed $9.4 million which it used
toward the purchase of a $10 million GNMA II mortgage-backed security. During
2001 the Company paid down $3.0 million of the borrowing using funds raised in
the deposit portfolio. At December 31, 2001 the borrowing was a 30 day note
maturing January 28, 2002. On January 28, 2002 management renewed the borrowing
for 90 days. Management will evaluate whether to replace the borrowing, and if
so, for what term at the maturity date.

  Other Liabilities

     Accrued interest payable decreased $101 thousand, or 16.9%, to $496
thousand as a result of lower rates on interest bearing liabilities offset by an
increased volume of those liabilities.

  Stockholders' Equity

     Class A common stock decreased $990 thousand during 2001. The change is the
result of stockholders exercising their right to convert the Class A common
shares to Class B common shares. Class B common stock increased $14.1 million
during 2001. The change is the result of the Class A shares converted, $2.5
million raised through a public offering of Class B common stock, $10.5 million
raised through conversion of the Company's warrants and $69 thousand raised
through the exercise of options. In October 2001, the Board of Directors
declared a stock dividend paid to the stockholders in Class B common stock. No
dividends were declared in 2000.

  INTEREST RATE RISK MANAGEMENT

     Interest rate risk management involves managing the extent to which
interest-sensitive assets and interest-sensitive liabilities are matched.
Interest rate sensitivity is the relationship between market interest rates and
earnings volatility due to the repricing characteristics of assets and
liabilities. The Company's net interest income is affected by changes in the
level of market interest rates. In order to maintain consistent earnings
performance, the Company seeks to manage, to the extent possible, the repricing
characteristics of its assets and liabilities.

     The ratio between assets and liabilities repricing in specific time
intervals is referred to as an interest rate sensitivity gap. Interest rate
sensitivity gaps can be managed to take advantage of the slope of the yield
curve as well as forecasted changes in the level of interest rate changes.

     One major objective of the Company when managing the rate sensitivity of
its assets and liabilities is to stabilize net interest income. The management
of and authority to assume interest rate risk is the responsibility of the
Company's Asset/Liability Committee ("ALCO"), which is comprised of six Board
members and the President of the Bank as well as two management employees. The
process to review interest rate risk management is a regular part of management
of the Company. In addition, there is an annual process to review the interest
rate risk policy with the Board of Directors which includes limits on the impact
to earnings from shifts in interest rates.

                                        23
<PAGE>

     The Company employs computerized interest income simulation modeling to
assist in quantifying interest rate risk exposure. This process measures and
quantifies the impact on net interest income through varying interest rate
changes and balance sheet compositions. The use of this model assists the ALCO
to gauge the effects of interest rate changes on interest sensitive assets and
liabilities in order to determine what impact these rates changes will have upon
the net interest spread. The results under this model fall within Board
prescribed guidelines.

     A simplistic method to monitor the interest sensitivity position is an
asset/liability model called "gap analysis" which measures the difference in the
volume of the Company's interest sensitive assets and liabilities that mature or
reprice within given periods. A positive gap (asset sensitive) indicates that
more assets reprice during a given period compared to liabilities, while a
negative gap (liability sensitive) has the opposite effect.

     At December 31, 2001, the Company maintained a one year negative cumulative
gap of $90.2 million or 18.1% of total assets.

<Table>
<Caption>
                                      INTEREST SENSITIVITY GAP AT DECEMBER 31, 2001
                                  -----------------------------------------------------
                                  3 MONTH    3 THROUGH   1 THROUGH    OVER
                                  OR LESS    12 MONTHS    3 YEARS    3 YEARS    TOTAL
                                  --------   ---------   ---------   -------   --------
                                                 (DOLLARS IN THOUSANDS)
<S>                               <C>        <C>         <C>         <C>       <C>
Interest bearing due from
  banks.........................  $    345   $      --   $     --    $    --   $    345
Federal funds sold..............    21,217          --         --         --     21,217
Investment securities, at
  amortized cost(1).............     6,925      19,105     18,780     10,600     55,410
Loans...........................   219,380      26,626     86,771     62,524    395,301
                                  --------   ---------   --------    -------   --------
Total earning assets............  $247,867   $  45,731   $105,551    $73,124   $472,273
                                  ========   =========   ========    =======   ========
Interest bearing transaction
  deposits......................  $ 29,905   $      --   $     --    $    --   $ 29,905
Interest bearing non-transaction
  deposits......................   131,575          --         --         --    131,575
Time deposits...................    58,520     159,897      3,980      1,279    223,676
Securities sold under agreement
  to repurchase.................        --       2,900         --         --      2,900
Other borrowings................     1,000          --         --         --      1,000
                                  --------   ---------   --------    -------   --------
Total interest bearing
  liabilities...................  $221,000   $ 162,797   $  3,980    $ 1,279   $389,056
                                  ========   =========   ========    =======   ========
Interest sensitivity gap........  $ 26,867   $(117,066)  $101,571    $71,845   $ 83,217
                                  ========   =========   ========    =======   ========
Cumulative gap..................  $ 26,867   $ (90,199)  $ 11,372    $83,217
                                  ========   =========   ========    =======
Cumulative gap to total
  assets........................       5.4%      -18.1%       2.3%      16.7%
</Table>

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

(1) Investment securities include Federal Reserve Bank stock and Federal Home
    Loan Bank stock, totalling $2.0 million.

  Liquidity

     The Company's liquidity is a measure of its ability to fund loans,
withdrawals or maturities of deposits, and other cash outflows in a cost
effective manner. The Company's principal sources of funds are deposits,
scheduled amortization and prepayments of loan principal, sales and maturities
of investment securities and funds provided by operations. While scheduled loan
payments and maturing investments are relatively predictable sources of funds,
deposit flows and loan prepayments are greatly influenced by general interest
rates, economic conditions and competition.

                                        24
<PAGE>

     As is disclosed under "Deposits", a substantial portion of the Company's
deposit portfolio consists of time deposits, including time deposits originated
through the internet deposit listing service used by the Company. These deposits
are generally of short to intermediate term, with terms generally of from 90
days to three years. The proceeds of these deposits have been invested in longer
term assets, primarily commercial and commercial real estate loans. The Company
will need to maintain these deposits, or find alternative sources of liquidity,
in order to maintain these assets. Although management believes a substantial
amount of the existing time deposits will renew, or substitute deposits will be
originated, the need to maintain this liquidity may impact the Company's ability
to react to changes in market rates of interest. As is discussed below,
management also believes the Company has substantial alternative sources of
liquidity.

     Through the Company's investment portfolio the Company has generally sought
to obtain a safe yet slightly higher yield than would have been available to the
Company as a net seller of overnight Federal funds while still maintaining
liquidity. Through its investment portfolio, the Company also attempts to manage
its maturity gap by seeking maturities of investments which reduce the repricing
mismatch in the loan and deposit portfolios.

     As an additional source of liquidity the Company has a $12 million
unsecured Federal funds overnight borrowing line of credit and a secured line of
credit with a correspondent bank. The Company's unencumbered investment
securities and selected mortgage loans are the collateral for the secured line
of credit and serve to determine the total amount available under the line.
During 2001 the Company did not draw on any of its borrowing lines.

     The Company entered into a $9.0 million repurchase agreement during October
1999. The funds received in the repurchase transaction were used toward the
purchase of a $10.1 million, 20 year, FHLMC mortgage-backed security which is
the security sold under the agreement. The borrowings under the repurchase
agreement mature as follows: $3.1 million in one year, $3.0 million in two years
and $2.9 million in three years. The cost of the one year borrowing is 6.04%,
the two year borrowing is at 6.25% and the three year borrowing is at 6.45%. At
each maturity date management evaluates whether to replace the borrowings or pay
them off using Company funds. The $3.0 million borrowing that matured during
2001 and the $3.1 million borrowing that matured during 2000 were repaid out of
funds raised in the deposit portfolio.

     The Company had $1.0 million in Federal Home Loan Bank borrowings at
December 31, 2001. In February 2000, the Company borrowed $9.4 million which it
used toward the purchase of a $10 million GNMA II mortgage-backed security.
During 2001 the Company paid down $3.0 million of the borrowing using funds
raised in the deposit portfolio. At December 31, 2001 the borrowing was a 30 day
note maturing January 28, 2002. On January 28, 2002 management renewed the
borrowing for 90 days. Management will evaluate whether to replace the
borrowing, and if so, for what term at the maturity date.

     Net cash provided by the Company's operating activities was $3.1 million in
2001 compared to $1.6 million in 2000 resulting from $818 thousand more in net
income and increases in various balance sheet items attributable to the growth
of the Company. The most significant components of operating activities in 2001
were a greater provision for loan losses attributable to growth in the loan
portfolio, more amortization and depreciation, more interest receivable due to
growth in the balance sheet and increased other assets to accommodate the growth
of the Company. The Company had lower accrued interest payable due to lower
market interest rates during the year.

     Net cash used in investing activities was $194.0 million in 2001 compared
to $132.9 million in 2000. The Company used $16.1 million for net investment
securities and Federal Reserve Bank and Federal Home Loan Bank stock in 2001,
while in 2000 it used cash of $11.5 million for its securities portfolio.
Additionally, the Company used $174.3 million and $120.4 million for net loans
and loan sales in 2001 and 2000, respectively.

     Net cash provided by the Company's financing activities was $194.9 million
in 2001 compared to $159.7 million in 2000. The increase in 2001 was primarily
due to a net increase in deposits and

                                        25
<PAGE>

$13.1 million received for net proceeds on common stock sold. Net deposits
provided an increase of $187.8 million in 2001 compared to $151.0 million in
2000. Additionally, in 2001 the Company used $3.0 million to buy back a portion
of a security sold under repurchase agreement and repaid $3.0 million of a
Federal Home Loan Bank borrowing.

     As a state chartered commercial bank, the Bank is required to maintain a
daily liquidity position equal to at least 15 percent of its total transaction
accounts and eight percent of its total nontransaction accounts, less those
deposits of public funds for which security has been pledged. As of December 31,
2001, the Bank had a liquidity ratio of 18 percent which was adequate to meet
the statutory requirement. The primary source of the Bank's liquidity is cash
and cash equivalents including federal funds sold -- overnight loans to major
commercial banks. At December 31, 2001, cash and cash equivalents totaled $37.5
million. Funds not required to meet loan and deposit demand were invested
primarily in mortgage-backed, U.S. Government and Agency securities. The Bank
considers these investments to be secondary sources of liquidity. The Bank's
investment securities classified as available for sale had a carrying value of
$18.0 million at December 31, 2001. The unrealized gain on the securities
classified as available for sale at December 31, 2001 was $154 thousand.

  Capital

     A significant measure of the strength of a financial institution is its
capital base. The Company's federal regulators have classified and defined
capital into the following components: (1) Tier I capital, which includes
tangible stockholders' equity for common stock and qualifying preferred stock,
and (2) Tier II capital, which includes a portion of the allowance for possible
loan losses, certain qualifying long-term debt and preferred stock which does
not qualify for Tier I capital. Minimum capital levels are regulated by
risk-based capital adequacy guidelines which require a financial institution to
maintain certain capital as a percent of its assets and certain off-balance
sheet items adjusted for predefined credit risk factors (risk-adjusted assets).
A financial institution is required to maintain, at a minimum, Tier I capital as
a percentage of risk-adjusted assets of 4.0% and combined Tier I and Tier II
capital as a percentage of risk-adjusted assets of 8.0%.

     In addition to the risk-based guidelines, the federal regulators require
that a financial institution which meets the regulators' highest performance and
operation standards maintain a minimum leverage ratio (Tier I capital as a
percentage of tangible assets) of 3%. For those institutions with higher levels
of risk or that are experiencing or anticipating significant growth, the minimum
leverage ratio will be proportionately increased by at least 100 to 200 basis
points. Minimum leverage ratios for each bank are evaluated through the ongoing
regulatory examination process.

     The Company's federal regulators impose capital standards on bank holding
companies which are substantially similar to those imposed upon the Bank.
However, provided the Company's total assets are less than $150 million, these
standards are applied on a bank only basis.

     Total stockholders' equity increased to $43.3 million at December 31, 2001
from $28.7 million at December 31, 2000. December 31, 2001 equity was affected
by net income of $1.4 million, Class B common stock issued in a stock offering
of $2.5 million, proceeds from the exercise of Class B stock purchase warrants
of $10.5 million, proceeds from stock options exercised of $69 thousand and an
increase of $45 thousand in net unrealized market value adjustments on available
for sale securities.

     On November 7, 2000 the Company commenced a public stock offering in which
it offered between 700,000 and 1,100,000 shares of Class B common stock to the
public at $10.00 per share. At December 31, 2000 the Company had sold 845,641
shares and collected net proceeds of $8.3 million in the offering. During 2001
the Company sold the remaining 254,359 shares available in the offering and
collected $2.5 million. Also during 2001 the Company called the Class B stock
purchase warrants. It issued 1,079,907 shares of Class B stock for the warrants
and collected $10.5 million. At December 31, 2001 the Company no longer has any
Class A shares outstanding and no longer has any stock purchase warrants
outstanding. The Company used $12.9 million to make additional investments in
the Bank during 2001.

                                        26
<PAGE>

     At December 31, 2001, the Company exceeded all regulatory capital
requirements as follows:

                                CAPITAL ADEQUACY

<Table>
<Caption>
                                                                                   TO BE WELL
                                                                                CAPITALIZED UNDER
                                                             FOR CAPITAL        PROMPT CORRECTIVE
                                            ACTUAL        ADEQUACY PURPOSES     ACTION PROVISIONS
                                        ---------------   ------------------   -------------------
ADMIRALTY BANCORP, INC.                 AMOUNT    RATIO    AMOUNT     RATIO     AMOUNT      RATIO
-----------------------                 -------   -----   ---------   ------   ---------   -------
                                                          (DOLLARS IN THOUSANDS)
<S>                                     <C>       <C>     <C>         <C>      <C>         <C>
Total Capital (to risk weighted
  assets).............................  $44,558   10.40%   >$34,263   > 8.00%   >$42,829   > 10.00%
                                                           -          -         -          -
Tier I Capital (to risk weighted
  assets).............................  $39,714    9.27%   >$17,132   > 4.00%   >$25,697   >  6.00%
                                                           -          -         -          -

Tier I Capital (to average assets)....  $39,714    8.08%   >$19,652   > 4.00%   >$24,566   >  5.00%
                                                           -          -         -          -
</Table>

     On March 11, 2000, the Company converted from a one bank holding company to
a financial holding company under the Gramm-Leach-Bliley Financial Modernization
Act of 1999 (the "Modernization Act"). This status permits the Company to
undertake financial activities which need not be closely related to banking,
such as insurance brokerage activities. Under the Modernization Act, the
Company's bank subsidiary must, among other requirements, remain "well
capitalized" or the Company could be required to divest itself of its
non-banking activities. Under Federal Reserve regulations the Company is
required to notify the Federal Reserve if it fails to meet the "well
capitalized" standard and adopt a plan of remediation. At December 31, 2001 the
Bank exceeded all regulatory capital requirements as demonstrated in the
following table:

                                CAPITAL ADEQUACY

<Table>
<Caption>
                                                                                   TO BE WELL
                                                                                CAPITALIZED UNDER
                                                             FOR CAPITAL        PROMPT CORRECTIVE
                                            ACTUAL        ADEQUACY PURPOSES     ACTION PROVISIONS
                                        ---------------   ------------------   -------------------
ADMIRALTY BANK                          AMOUNT    RATIO    AMOUNT     RATIO     AMOUNT      RATIO
--------------                          -------   -----   ---------   ------   ---------   -------
                                                             (DOLLARS IN
                                                              THOUSANDS)
<S>                                     <C>       <C>     <C>         <C>      <C>         <C>
Total Capital (to risk weighted
  assets).............................  $44,047   10.29%   >$34,253   > 8.00%   >$42,816   > 10.00%
                                                           -          -         -          -

Tier I Capital (to risk weighted
  assets).............................  $39,203    9.16%   >$17,126   > 4.00%   >$25,690   >  6.00%
                                                           -          -         -          -

Tier I Capital (to average assets)....  $39,203    7.99%   >$19,637   > 4.00%   >$24,546   >  5.00%
                                                           -          -         -          -

</Table>

  Impact Of Inflation And Changing Prices

     The financial statements of the Company and notes thereto, presented
elsewhere herein, have been prepared in accordance with accounting principles
generally accepted in the United States of America, which require the
measurement of financial position and operating results in terms of historical
dollars without considering the change in the relative purchasing power of money
over time and due to inflation. The impact of inflation is reflected in the
increased cost of the Company's operations. Unlike most industrial companies,
nearly all the assets and liabilities of the Company are monetary. As a result,
interest rates have a greater impact on the Company's performance than do the
effects of general levels of inflation. Interest rates do not necessarily move
in the same direction or to the same extent as the prices of goods and services.

  Impact Of New Accounting Standards

     In July 2001, the Financial Accounting Standards Board (" FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 141, "Business
Combinations", ("Statement 141") and SFAS No. 142, "Goodwill and Other
Intangible Assets," ("Statement 142"). Statement 141 requires that the purchase
method of accounting be used for all business combinations initiated after June
30, 2001. Statement 142 requires that goodwill and intangible assets with
indefinite useful lives no longer be amortized, but instead tested for
impairment at least annually in accordance with the provisions of

                                        27
<PAGE>

Statement 142. Other intangible assets would continue to be amortized over their
estimated useful lives. In the transition, any impairment losses will be
measured as of the date of adoption and recognized as the cumulative effect of a
change in accounting principle in the first interim period.

     The Company is required to adopt the provisions of Statement 141
immediately and the Company adopted Statement 142 effective January 1, 2002. As
of the date of adoption, the Company had unamortized goodwill in the amount of
approximately $3.2 million that is subject to the transition provisions of
Statements 141 and 142. Pursuant to Statement 142, the Company will no longer
amortize goodwill. Amortization expense related to goodwill was approximately
$153 thousand for each of the years ended December 31, 2001 and 2000. The
adoption of Statement 142 did not result in a transitional impairment loss.

     In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations" ("Statement 143"), which addresses financial accounting
and reporting for legal obligations associated with the retirement of tangible
long-lived assets and the associated asset retirement costs. Statement 143 is
effective for fiscal years beginning after June 15, 2002. This Statement is not
expected to have a material impact on the Company's financial statements.

     In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment of Long-Lived Assets" ("Statement 144") which supercedes SFAS No.
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of" ("Statement 121") and the accounting and reporting
provisions of APB No. 30, "Reporting the Results of Operations -- Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions," for the disposal of a segment
of a business. While Statement 144 retains many of the fundamental provisions of
Statement 121, it establishes a single accounting model for long-lived assets to
be disposed of by sale, and resolves certain implementation issues not
previously addressed by Statement 121. Statement 144 is effective for fiscal
years beginning after December 15, 2001. This Statement did not have a material
impact on the Company's financial statements.

ITEM 7.  FINANCIAL STATEMENTS

     The financial statements required by this item are filed herewith.

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

     There have been no changes in or disagreements with the Company's
accountants in the two most recent fiscal years.

                                        28
<PAGE>

                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS,
         COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

     Information concerning directors and executive officers is included in the
definitive Proxy Statement for the Company's 2002 Annual Meeting under the
captions "ELECTION OF DIRECTORS" and information concerning compliance with
Section 16(a) of the Exchange Act is included under the caption "COMPLIANCE WITH
SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934," each of which is
incorporated herein by reference. It is expected that such Proxy Statement will
be filed with the Securities and Exchange Commission no later than April 26,
2002.

     The following table sets forth certain information about each executive
officer of the Company who is not also a director.

<Table>
<Caption>
NAME, AGE AND POSITION PRINCIPAL     OFFICER SINCE    OCCUPATION DURING PAST FIVE YEARS
--------------------------------     -------------   -----------------------------------
<S>                                  <C>             <C>
William Burke, 42..................      1998        Officer of the Bank since July
  Executive Vice President and                       1998. Previously Senior Vice
  Chief Operating Officer of the                     President and Regional Senior
  Bank                                               Lending Officer of 1st United Bank,
                                                     Boca Raton, Florida.

Dennis Gavin, 37...................      1998        Officer of the Bank since July
  Executive Vice President and                       1998. Previously Vice President of
  Senior Lending Officer of the                      Commercial Lending for 1st United
  Bank                                               Bank, Boca Raton, Florida.

Lawrence Roselle, 44...............      1999        Officer of the Bank since December
  Area President of Brevard Region                   1999. Previously Senior Vice
  of the Bank                                        President and County Executive of
                                                     1st United Bank, Boca Raton,
                                                     Florida (acquired by Wachovia Bank)
                                                     and previously Senior Vice
                                                     President and Office Manager of
                                                     Barnett Bank of Central Florida,
                                                     Orlando, Florida.

Kevin M. Sacket, 41................      1998        Officer of the Bank since August
  Treasurer of Admiralty Bancorp                     1998. Previously Vice President and
  Executive Vice President and                       Chief Financial Officer of First
  Chief Financial Officer of the                     Western Bank, Cooper City, Florida.
  Bank                                               Previously Vice President of
                                                     Accounting for 1st United Bank,
                                                     Boca Raton, Florida.
</Table>

ITEM 10.  EXECUTIVE COMPENSATION

     Information concerning executive compensation is included in the definitive
Proxy Statement for the Company's 2002 Annual Meeting under the captions
"EXECUTIVE COMPENSATION AND ALL OTHER COMPENSATION" and "COMPENSATION OF
DIRECTORS", which is incorporated by reference herein. It is expected that such
Proxy Statement will be filed with the Securities and Exchange Commission no
later than April 26, 2002.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     Information concerning security ownership of certain beneficial owners and
management is included in the definitive Proxy statement for the Company's 2002
Annual Meeting under the caption "SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT", which is incorporated herein by reference. It is
expected that such Proxy statement will be filed with the Securities and
Exchange Commission no later than April 26, 2002.

                                        29
<PAGE>

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Information concerning certain relationships and related transactions is
included in the definitive Proxy Statement for the Company's 2002 Annual Meeting
under the caption "INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS",
which is incorporated herein by reference. It is expected that such Proxy
Statement will be filed with the Securities and Exchange Commission no later
than April 26, 2002.

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K

     (a) Exhibits

<Table>
<Caption>
EXHIBIT
NUMBER       DESCRIPTION OF EXHIBITS
-------      -----------------------
<S>          <C>
10           Change in Control Agreements
10(a)        Amended Senior Management 1998 Change In Control Program
10(b)        Change In Control Program For The Chairman Of The Board
10(c)        Addendum to Change In Control Program For The Chairman Of
             The Board
10(d)        Directors' 2002 Change in Control Bonus Program
10(e)        Senior Management 2002 Change in Control Bonus Program (with
             extended benefits)
10(f)        Senior Management 2002 Change in Control Bonus Program
             (without extended benefits)
10(g)        Employment Agreement -- Ward Kellogg
21           Subsidiaries of the registrant
23           Consent of Independent Public Accountants
</Table>

     (b) Reports on form 8-K

<Table>
<Caption>
DATE             ITEM
----             ----
<S>              <C>
October 16       5 -- announcing third quarter results
October 29       5 -- announcing declaration of stock dividend on its common
                 stock
November 27      5 -- announcing that the Bank exceeded $500 million in total
                 assets
</Table>

                                        30
<PAGE>

                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

                               TABLE OF CONTENTS

<Table>
<S>                                                           <C>
INDEPENDENT AUDITORS' REPORT................................   32

CONSOLIDATED FINANCIAL STATEMENTS

     CONSOLIDATED BALANCE SHEETS............................   33

     CONSOLIDATED STATEMENTS OF OPERATIONS..................   34

     CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS'
      EQUITY................................................   35

     CONSOLIDATED STATEMENTS OF CASH FLOWS..................   36

     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.............   37
</Table>

                                        31
<PAGE>

                          INDEPENDENT AUDITORS' REPORT

The Board of Directors and Stockholders
Admiralty Bancorp, Inc.:

     We have audited the accompanying consolidated balance sheets of Admiralty
Bancorp, Inc. and subsidiary as of December 31, 2001 and 2000, and the related
consolidated statements of operations, changes in stockholders' 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
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated 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 Admiralty
Bancorp, Inc. and subsidiary as of December 31, 2001 and 2000, and the results
of their operations and their cash flows for the years then ended, in conformity
with accounting principles generally accepted in the United States of America.

/s/ KPMG LLP

January 14, 2002

                                        32
<PAGE>

                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

                          CONSOLIDATED BALANCE SHEETS

<Table>
<Caption>
                                                                   DECEMBER 31,
                                                              -----------------------
                                                                  2001         2000
                                                              ------------   --------
                                                              (DOLLARS IN THOUSANDS)
<S>                                                           <C>            <C>
                                       ASSETS
Cash and cash equivalents:
  Cash and due from banks...................................    $ 15,930     $ 11,221
  Interest bearing due from banks...........................         345        1,035
  Federal funds sold........................................      21,217       21,189
                                                                --------     --------
     Total cash and cash equivalents........................      37,492       33,445
Investment securities available for sale, at fair market
  value.....................................................      17,969       13,628
Investment securities held to maturity, at cost (fair market
  value of $36.1 million and $24.8 million at December 31,
  2001 and 2000, respectively)..............................      35,589       24,549
Loans, net..................................................     390,457      218,629
Accrued interest receivable.................................       1,928        1,439
Federal Reserve Bank and FHLB stock, at cost................       2,007        1,337
Premises and equipment, net.................................       5,422        2,666
Deferred tax asset, net.....................................       1,714          774
Goodwill (net of accumulated amortization of $607 thousand
  and $454 thousand at December 31, 2001 and 2000,
  respectively).............................................       3,234        3,387
Other assets................................................       1,770        1,507
                                                                --------     --------
     Total assets...........................................    $497,582     $301,361
                                                                ========     ========
                        LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits....................................................    $449,144     $261,315
Securities sold under agreement to repurchase...............       2,900        5,900
Advances from FHLB..........................................       1,000        4,000
Accrued interest payable....................................         496          597
Other liabilities...........................................         756          831
                                                                --------     --------
  Total liabilities.........................................     454,296      272,643
                                                                ========     ========
STOCKHOLDERS' EQUITY
Preferred stock, no par value, 2,000,000 shares authorized,
  no shares issued or outstanding...........................          --           --
Common stock, Class A, no par value, 1,000,000 shares
  authorized, no shares issued and outstanding at December
  31, 2001 and 117,500 shares issued and outstanding at
  December 31, 2000, Class A shares are convertible to Class
  B common stock............................................          --          990
Common stock, Class B, no par value, 7,500,000 shares
  authorized, 5,282,485 and 3,555,431 shares issued and
  outstanding at December 31, 2001 and 2000 respectively....      44,596       30,507
Accumulated deficit.........................................      (1,407)      (2,831)
Accumulated other comprehensive income, net.................          97           52
                                                                --------     --------
Total stockholders' equity..................................      43,286       28,718
                                                                --------     --------
Total liabilities and stockholders' equity..................    $497,582     $301,361
                                                                ========     ========
</Table>

          See accompanying notes to consolidated financial statements.

                                        33
<PAGE>

                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

                     CONSOLIDATED STATEMENTS OF OPERATIONS

<Table>
<Caption>
                                                                  YEAR ENDED          YEAR ENDED
                                                              DECEMBER 31, 2001    DECEMBER 31, 2000
                                                              ------------------   -----------------
                                                                      (IN THOUSANDS, EXCEPT
                                                                    SHARE AND PER-SHARE DATA)
<S>                                                           <C>                  <C>
Interest and dividend income
  Loans.....................................................      $   26,056          $   13,645
  Mortgage-backed securities................................           2,957               1,972
  Other debt securities.....................................             260                 447
  Federal funds sold........................................             965                 618
  Dividends from Federal Reserve Bank and FHLB stock........             108                  85
  Other.....................................................              17                  13
                                                                  ----------          ----------
    Total interest and dividend income......................          30,363              16,780
                                                                  ----------          ----------
Interest expense
  Deposits..................................................          14,270               7,007
  Federal funds purchased...................................              --                  23
  Securities sold under repurchase agreement................             337                 528
  Advances from FHLB........................................             102                 407
                                                                  ----------          ----------
    Total interest expense..................................          14,709               7,965
                                                                  ----------          ----------
    Net interest and dividend income........................          15,654               8,815
Provision for loan losses...................................           2,528               1,442
                                                                  ----------          ----------
    Net interest and dividend income after provision for
      loan losses...........................................          13,126               7,373
                                                                  ----------          ----------
Non-interest income
  Service charges and fees..................................           1,135                 950
  Insurance commissions.....................................              66                  16
  Net gain on sale of securities............................              --                  17
  Gain on sale of loans.....................................              27                  32
  Gain on sale of other real estate.........................              --                  25
  Other income..............................................               6                   4
                                                                  ----------          ----------
    Total non-interest income...............................           1,234               1,044
                                                                  ----------          ----------
Non-interest expense
  Salaries and employee benefits............................           6,295               3,623
  Occupancy.................................................           1,769               1,064
  Furniture and equipment...................................             711                 455
  Amortization of goodwill..................................             153                 153
  Other expense.............................................           3,102               2,153
                                                                  ----------          ----------
    Total non-interest expense..............................          12,030               7,448
                                                                  ----------          ----------
    Income before income tax expense........................           2,330                 969
Income tax expense..........................................             906                 363
                                                                  ----------          ----------
  Net income................................................      $    1,424          $      606
                                                                  ----------          ----------
Per share data
Net income per share -- basic...............................      $     0.30          $     0.19
                                                                  ==========          ==========
Net income per share -- diluted.............................      $     0.28          $     0.19
                                                                  ==========          ==========
Weighted average shares outstanding -- basic................       4,808,305           3,147,548
                                                                  ==========          ==========
Weighted average shares outstanding -- diluted..............       5,011,996           3,147,548
                                                                  ==========          ==========
</Table>

          See accompanying notes to consolidated financial statements.

                                        34
<PAGE>

                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

<Table>
<Caption>
                                          COMMON STOCK
                            ----------------------------------------    RETAINED      ACCUMULATED
                                 CLASS A               CLASS B          EARNINGS/        OTHER           TOTAL
                            ------------------   -------------------   ACCUMULATED   COMPREHENSIVE   STOCKHOLDERS'   COMPREHENSIVE
                             NUMBER       $       NUMBER        $       (DEFICIT)    INCOME/(LOSS)      EQUITY          INCOME
                            --------   -------   ---------   -------   -----------   -------------   -------------   -------------
                                                                    (DOLLARS IN THOUSANDS)
<S>                         <C>        <C>       <C>         <C>       <C>           <C>             <C>             <C>
Balance at December 31,
  1999....................   844,254   $ 7,114   1,889,205   $16,073     $(3,437)        $(176)         $19,574
Class A shares converted
  to Class B shares.......  (726,754)   (6,124)    820,585     6,124          --            --               --
Stock issued, net of $147
  offering costs..........        --        --     845,641     8,310                        --            8,310
Net income for year ended
  December 31, 2000.......        --        --          --        --         606            --              606            606
Other comprehensive
  income:
  Change in net unrealized
    loss on securities
    held available for
    sale, net of taxes of
    $26...................        --        --          --        --          --           228              228            228
                            --------   -------   ---------   -------     -------         -----          -------         ------
Comprehensive income......                                                                                              $  834
                                                                                                                        ======
Balance at December 31,
  2000....................   117,500   $   990   3,555,431   $30,507     $(2,831)        $  52          $28,718
Class A shares converted
  to Class B shares.......  (117,500)     (990)    132,670       990          --            --               --
Stock issued through
  offering net of $8
  costs...................        --        --     254,359     2,535                        --            2,535
Stock issued for warrant
  conversions net of $22
  costs...................        --        --   1,079,907    10,495                        --           10,495
Stock issued for options
  exercised net of $10
  costs...................        --        --       8,275        69                        --               69
Shares issued for stock
  dividend................        --        --     251,843        --                        --               --
Net income for year ended
  December 31, 2001.......        --        --          --        --       1,424            --            1,424          1,424
Other comprehensive
  income:
  Change in net unrealized
    gain on securities
    held available for
    sale, net of taxes of
    $27...................        --        --          --        --          --            45               45             45
                            --------   -------   ---------   -------     -------         -----          -------         ------
Comprehensive income......                                                                                              $1,469
                                                                                                                        ======
Balance at December 31,
  2001....................        --   $    --   5,282,485   $44,596     $(1,407)        $  97          $43,286
                            ========   =======   =========   =======     =======         =====          =======
</Table>

          See accompanying notes to consolidated financial statements.

                                        35
<PAGE>

                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

<Table>
<Caption>
                                                                 YEAR ENDED          YEAR ENDED
                                                              DECEMBER 31, 2001   DECEMBER 31, 2000
                                                              -----------------   -----------------
                                                                     (DOLLARS IN THOUSANDS)
<S>                                                           <C>                 <C>
Operating activities
  Net income................................................      $   1,424           $     606
  Adjustments to reconcile net income to net cash provided
    by operating activities
    Provision for loan losses...............................          2,528               1,442
    Depreciation and amortization...........................          1,026                 636
    Amortization, net of accretion, of investment
      securities............................................             74                  13
    Deferred income tax provision...........................           (967)               (446)
    Gain on sales of securities.............................             --                 (17)
    Gain on sales of loans..................................            (27)                (32)
    Loss on sales of premises and equipment.................             --                   2
    Gain on sales of other real estate owned................             --                 (26)
    Change in accrued interest receivable...................           (489)               (797)
    Change in accrued interest payable......................           (101)                383
    Change in other assets..................................           (263)               (697)
    Change in other liabilities.............................            (75)                501
                                                                  ---------           ---------
      Net cash provided by operating activities.............          3,130               1,568
                                                                  ---------           ---------
Investing activities
  Proceeds from maturities of investment securities
    available for sale......................................          7,500                 500
  Proceeds from maturities of mortgage-backed securities
    available for sale......................................          4,700               1,119
  Proceeds from maturities of investment securities held to
    maturity................................................            500                  --
  Proceeds from maturities of mortgage-backed securities
    held to maturity........................................         11,020               1,977
  Proceeds from sales of investment securities available for
    sale....................................................             --                  17
  Purchases of investment securities available for sale.....         (1,000)             (1,000)
  Purchases of mortgage-backed securities available for
    sale....................................................        (15,486)             (4,998)
  Purchases of investment securities held to maturity.......         (5,541)                 --
  Purchases of mortgage-backed securities held to
    maturity................................................        (17,076)             (8,514)
  Purchase of Federal Reserve Bank & FHLB stock.............           (670)               (565)
  Net loan originations and principal collections on
    loans...................................................       (174,737)           (122,069)
  Proceeds from loan sales..................................            408               1,716
  Proceeds from sale of premises and equipment..............             --                   2
  Proceeds from sales of other real estate owned............             --                 187
  Purchase of premises and equipment, net...................         (3,629)             (1,312)
                                                                  ---------           ---------
    Net cash used in investing activities...................       (194,011)           (132,940)
                                                                  ---------           ---------
Financing activities
  Net change in deposits....................................        187,829             151,042
  Net change in federal funds purchased.....................             --                (571)
  Net change in securities sold under agreement to
    repurchase..............................................         (3,000)             (3,100)
  Net change in FHLB advances...............................         (3,000)              4,000
  Proceeds from issuance of common stock -- net of costs of
    $40 and $147, in 2001 and 2000, respectively............         13,099               8,310
                                                                  ---------           ---------
    Net cash provided by financing activities...............        194,928             159,681
                                                                  ---------           ---------
Net increase in cash and cash equivalents...................          4,047              28,309
Cash and cash equivalents, beginning of year................         33,445               5,136
                                                                  ---------           ---------
Cash and cash equivalents, end of year......................      $  37,492           $  33,445
                                                                  =========           =========
Supplemental disclosures:
  Cash paid for:
    Interest................................................      $  14,810           $   7,573
    Taxes...................................................          1,695                 755
  Noncash investing and financing activities:
    Change in unrealized gain (loss) on available for sale
      securities............................................      $      72           $     364
    Change in deferred taxes related to available for sale
      securities............................................            (27)               (136)
    Transfer of loans to other real estate..................             --                 154
</Table>

          See accompanying notes to consolidated financial statements.

                                        36
<PAGE>

                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2001 AND 2000

NOTE 1 -- ORGANIZATION

  NATURE OF BUSINESS

     Admiralty Bancorp, Inc. is a financial holding company incorporated in the
state of Delaware. The consolidated financial statements include the accounts of
Admiralty Bancorp, Inc. ("Admiralty"), and its wholly owned subsidiary,
Admiralty Bank ("the Bank"), collectively referred to as "the Company". The Bank
is a state-chartered independent community bank with its main office in Palm
Beach Gardens, Florida, and branches in Altamonte Springs, Boca Raton, Cocoa
Beach, Fort Lauderdale, Juno Beach, Jupiter, Melbourne, and Orlando, Florida.

     The Bank operates as a commercial bank offering a wide variety of
commercial loans and, to a lesser degree, consumer credits. The Bank originates
small business loans which are partially guaranteed by the Small Business
Administration. The Bank sells the guaranteed portion to unrelated third
parties. The Bank continues to service these loans. Its primary future strategic
aim is to establish a reputation and market presence as the "small and middle
market business bank" in its principal market. The Bank funds its loans
primarily by offering time, savings and money market, and demand deposit
accounts to both commercial enterprises and individuals. Additionally, the Bank
originates residential mortgage loans. Principal markets include southern and
central Florida.

     The Bank competes with other banking and financial institutions in its
primary markets. Commercial banks, savings banks, savings and loan associations,
mortgage bankers and brokers, credit unions and money market funds actively
compete for deposits and loans. Such institutions, as well as consumer finance,
mutual funds, insurance companies, and brokerage and investment banking firms,
may be considered competitors of the Bank with respect to one or more of the
services it renders.

     The Company has formed Admiralty Insurance Services, LLC ("AIS") as a joint
venture with USI Florida ("USI") to offer a wide range of insurance products,
primarily to customers of the Bank. USI and the Company are each 50 percent
owners of AIS. USI and AIS share equally in commissions on policies sold, and
the Company is entitled to 50 percent of the net income of AIS. Under the
agreement, USI absorbs all costs incurred by AIS for operating expenses.

     The Bank is subject to regulations of certain state and federal agencies
and, accordingly, it is periodically examined by those regulatory authorities.
As a consequence of the extensive regulation of commercial banking activities,
the Bank's business is particularly susceptible to being affected by state and
federal legislation and regulations.

NOTE 2 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

  BASIS OF PRESENTATION

     The consolidated financial statements include the accounts of Admiralty
Bancorp, Inc. and its wholly owned subsidiary, Admiralty Bank.

     The accounting policies of the Company conform with accounting principles
generally accepted in the United States of America and predominant practices
within the banking industry. All significant intercompany balances and
transactions have been eliminated in consolidation.

  USE OF ESTIMATES

     The preparation of consolidated financial statements 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. These estimates and assumptions also affect reported

                                        37
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

amounts of revenue and expenses during the reporting period. Actual results
could differ from those estimates.

     The principal estimate that is particularly susceptible to significant
change in the near term relates to the allowance for loan losses. The evaluation
of the adequacy of the allowance for loan losses includes, among other factors,
an analysis of historical loss rates, by category, applied to current loan
totals. However, actual losses may be higher or lower than historical trends
which vary. Actual losses on specified problem loans, which also are provided
for in the evaluation, may vary from estimated loss percentages, which are
established based upon a limited number of potential loss classifications.

     As of December 31, 2001, substantially all of the Company's real estate
loans are secured by real estate in Palm Beach, Brevard, Broward, Orange,
Osceola and Seminole counties. Accordingly, the ultimate collectibility of a
substantial portion of the Company's real estate loan portfolio is susceptible
to changes in market conditions in the above Florida counties. Management
believes that the allowances for losses on loans is adequate. While management
uses available information to recognize losses on loans, future additions to the
allowances may be necessary based on changes in economic conditions,
particularly in the above counties. In addition, various regulatory agencies, as
an integral part of their examination process, periodically review the Company's
allowances for losses on loans. Such agencies may require the Company to
recognize additions to the allowance based on their judgments about information
available to them at the time of their examination.

  INVESTMENT SECURITIES

     The Bank accounts for its investment securities in accordance with
Statement of Financial Accounting Standards ("SFAS") No. 115, "Accounting for
Certain Investments in Debt and Equity Securities." This standard requires
investments in securities to be classified in one of three categories: held to
maturity, trading, or available for sale. Investments in debt securities, for
which management has both the ability and intent to hold to maturity, are
carried at cost, adjusted for the amortization of premiums and accretion of
discounts computed by the interest method. Investments in debt and marketable
equity securities, which management believes may be sold prior to maturity due
to changes in interest rates, prepayment risk and equity, liquidity requirements
or other factors, are classified as available for sale. Net unrealized gains and
losses for such securities, net of tax effect, are recognized as a component of
comprehensive income included in stockholders' equity and excluded from the
determination of net income. Declines in the fair value of individual
held-to-maturity and available-for-sale securities below their cost that are
other than temporary results in write-downs of the individual securities to
their fair value with the related write-downs included in earnings as realized
losses. The Bank does not engage in security trading. Security transactions are
accounted for on a trade date basis. Gains or losses on disposition of
investment securities are based on the net proceeds and the adjusted carrying
amount of the securities sold using the specific identification method.

     The Company does not purchase, sell or utilize off-balance sheet derivative
financial instruments or derivative commodity instruments.

  LOANS AND ALLOWANCE FOR LOAN LOSSES

     Loans that management has the intent and ability to hold for the
foreseeable future or until maturity or payoff are stated at the amount of
unpaid principal and are net of deferred fees or costs on originated loans and
an allowance for loan losses. Loan fees and certain direct loan origination
costs are deferred, and the net amount is recognized in interest income using
the interest method over the contractual life of the loans. Commitment fees and
costs relating to commitments whose likelihood of exercise is remote are
recognized over the commitment period on a straight-line basis. If the
commitment is subsequently exercised during the commitment period, the remaining
unamortized commitment fee at the time of

                                        38
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

exercise is recognized over the life of the loan as a yield adjustment. The
allowance for loan losses is established through a provision for loan losses
charged to expense. Loan principal considered to be uncollectible by management
is charged against the allowance for loan losses. The allowance is an amount
that management believes will be adequate to absorb inherent losses which
probably exist as of the evaluation date due to the inherent risks in the loan
portfolio even though they might not have been identified by the objective loan
review process. The evaluation takes into consideration such factors as changes
in the nature and size of the loan portfolio, overall portfolio quality,
specific problem loans, and current and future economic conditions which may
affect the borrowers' ability to pay. The evaluation details historical losses
by loan category, the resulting loss rates for which are projected at current
loan total amounts. Loss estimates for specified problem loans are also
detailed.

     The Company follows a consistent procedural discipline and accounts for
loan loss contingencies in accordance with SFAS No. 5, "Accounting for
Contingencies", and SFAS No. 114 "Accounting by Creditors for Impairment of a
Loan," as amended by SFAS No. 118, "Accounting by Creditors for Impairment of a
Loan -- Income Recognition and Disclosures." The following is a description of
how each portion of the allowance for loan losses is determined:

     The Company segregates the loan portfolio for loan loss purposes into
segments based upon the underlying collateral. The Company provides for a
general allowance for losses inherent in the portfolio by such collateral
categories. General loss percentages are established based upon historical
analyses as well as estimates of the inherent losses which probably exist as of
the evaluation date even though they might not have been identified by the more
objective processes used. This is due to the risk of error and/or inherent
imprecision in the process. This portion of the allowance is particularly
subjective and requires judgments based on qualitative factors which do not lend
themselves to exact mathematical calculations such as: trends in delinquencies
and nonaccruals; migration trends in the portfolio; trends in volume, terms, and
portfolio mix; new credit products and/or changes in the geographic distribution
of those products; changes in lending policies and procedures; loan review
reports on the efficacy of the risk identification process; changes in the
outlook for local, regional and national economic conditions; concentrations of
credit; and peer group comparisons.

     Specific allowances are provided in the event that the specific analysis on
each classified loan indicates that it is probable that the Bank will be unable
to collect all amounts due, both principal and interest, according to the
contractual terms of the loan agreement. When a loan is impaired, the Bank
measures impairment based on either (a) the present value of the expected future
cash flows of the impaired loan discounted at the loan's original effective
rate, (b) the observable market price of the impaired loans, or (c) the fair
value of the collateral of a collateral-dependent loan. The Bank selects the
measurement method on a loan-by-loan basis, except for collateral-dependent
loans for which foreclosure is probable must be measured at the fair value of
the collateral. In a troubled debt restructuring involving a restructured loan,
the Bank measures impairment by discounting the total expected future cash flows
at the loan's original effective rate of interest. The provision for loan loss
is adjusted in order to state the allowance for loan losses to the required
level as determined above.

     Interest income is accrued as earned on a simple interest basis. Accrual of
interest is discontinued on a loan when management believes, after considering
economic and business conditions and collection efforts, that the borrower's
financial condition is such that collection of interest is doubtful. When a loan
is placed on such non-accrual status, all accumulated accrued interest
receivable is reversed out of current period income. Until the loan becomes
current, any payments received from the borrower are applied to outstanding
principal until such time as management determines that the financial condition
of the borrower and other factors merit recognition of such payments as interest
at which time the loan is returned to accruing status. Loans 90 days or more
past due and still accruing interest must have both principal and accruing
interest adequately secured and must be in the process of collection.

                                        39
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  PREMISES AND EQUIPMENT

     Premises and equipment, including leasehold improvements, are stated at
cost less accumulated depreciation and amortization. Depreciation expense is
computed on the straight-line method over the estimated useful lives of the
assets. Leasehold improvements are amortized over the shorter of the estimated
useful lives of the improvements or the terms of the related leases.

     Maintenance and repairs are charged to expense as incurred and improvements
are capitalized. The cost and accumulated depreciation relating to premises and
equipment retired or otherwise disposed of are eliminated from the accounts and
any resulting gains or losses are credited or charged to income.

  OTHER REAL ESTATE OWNED

     Assets acquired through, or in lieu of, loan foreclosures are held for sale
and are initially recorded at fair value at the date of foreclosure,
establishing a new cost basis.

     Subsequent to foreclosure, valuations are periodically performed by
management and the assets are carried at the lower of the carrying amount or
fair value less cost to sell. Revenue and expenses from operations and changes
in the valuation allowance are included in other non-interest expense.

  MORTGAGE SERVICING

     Servicing assets are recognized as separate assets when rights are acquired
through purchase or through sale of financial assets. Capitalized servicing
rights are reported in other assets and are amortized into non-interest income
in proportion to, and over the period of, the estimated future net servicing
income of the underlying financial assets. Servicing assets are evaluated for
impairment based upon the fair value of the rights as compared to amortized
cost. Impairment is determined by stratifying rights by predominant
characteristics, such as interest rates and terms. Fair value is determined
using prices for similar assets with similar characteristics, when available, or
based upon discounted cash flows using market-based assumptions. Impairment is
recognized through a valuation allowance for an individual stratum, to the
extent that fair value is less than the capitalized amount for the stratum.

  GOODWILL

     Goodwill, representing the excess of the purchase price over the fair value
of the net assets acquired from White Eagle Financial Group in January 1998, was
being amortized on a straight-line basis over its estimated useful life of 25
years. Beginning January 1, 2002 goodwill is no longer amortized, rather, in
accordance with SFAS No. 142, "Goodwill and Other Intangibles", the Company, at
each balance sheet date, evaluates the recovery of the carrying amount of
goodwill by determining if any impairment indicators are present. These
indicators are primarily driven by the fair value of the reporting unit. If this
review indicates that goodwill is impaired, the Company's carrying value of the
goodwill is reduced to the implied fair value of the goodwill.

  TRANSFERS OF FINANCIAL ASSETS

     Transfers of financial assets are accounted for as sales, when control over
the assets has been surrendered. Control over transferred assets is deemed to be
surrendered when (1) the assets have been isolated from the Company, (2) the
transferee obtains the right (free of conditions that constrain it from taking
advantage of that right) to pledge or exchange the transferred assets, and (3)
the Company does not maintain effective control over the transferred assets
through an agreement to repurchase them before their maturity.

                                        40
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  LONG-LIVED AND INTANGIBLE ASSETS

     The Bank accounts for long-lived and intangible assets in accordance with
SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of," which provides guidance on when to
recognize and how to measure impairment losses of long-lived assets and certain
identifiable intangibles and how to value long-lived assets to be disposed of.
The Statement requires that long-lived and certain identifiable intangibles be
reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. Recoverability of
assets to be held and used is measured by a comparison of the carrying amount of
an asset to the future undiscounted cash flows expected to be generated by the
asset. If such assets are considered to be impaired, the impairment to be
recognized is measured by the amount by which the carrying amount of the asset
exceeds the fair value of the assets. Assets to be disposed of are reported at
the lower of the carrying amount or the fair value less costs to sell.

  RESTRICTIONS ON CASH AND DUE FROM BANKS

     The Bank is required to maintain reserves against customer demand deposits
by keeping cash on hand or balances with the Federal Reserve Bank in a
non-interest bearing account. The reserve balances required to be maintained in
cash on hand and/or in balances at the Federal Reserve Bank were $4.9 million
and $1.9 million at December 31, 2001 and 2000, respectively.

  STATEMENT OF CASH FLOWS

     Cash and cash equivalents are defined as cash on hand, cash items in the
process of collection, amounts due from banks and federal funds sold with an
original maturity of three months or less.

  MANAGEMENT STOCK OPTION PLAN

     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 ("APB 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 Company's management stock option plans
have no intrinsic value at the grant date, and under APB Opinion No. 25 no
compensation is recognized for them. The Company has elected to continue with
the accounting methodology in APB 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.

  RETIREMENT PLAN

     The Company has a savings plan pursuant to the provisions of section 401(k)
of the Internal Revenue Code for all eligible employees. An eligible employee
may elect to contribute to the 401(k) plan in the form of deferrals of between
1% and 15% of the total base compensation that would otherwise be payable to the
employee. Employee contributions are fully vested and non-forfeitable at all
times. The 401(k) plan permits contributions by the Company. In 2001 and 2000
the Company matched 50% of the employees' contributions of up to 6% of the
participant's base salary. The Company accrues costs as incurred. Expenses
accrued toward contributions to this plan amounted to $97 thousand and $55
thousand for the years ended December 31, 2001 and 2000, respectively.

                                        41
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  EARNINGS PER COMMON SHARE

     The Company computes basic and diluted earnings per share in accordance
with SFAS No. 128, "Earnings per Share." Basic earnings per share is computed by
dividing the net income to common stockholders for the year by the
weighted-average number of shares of common stock outstanding during the year.
Diluted earnings per share is computed by dividing the net income available to
common stockholders for the year by the weighted-average number of common stock
and potential common stock outstanding during the year, to the extent that such
potential common stock is dilutive. Potential common stock consists of the
shares issuable pursuant to the exercise of stock options.

     On October 25, 2001, the Board of Directors declared a 5% stock dividend
payable in Class B common stock to all stockholders of record as of November 9,
2001. For purposes of the earnings per share, the issuance of this stock
dividend has been effected as of January 1, 2000. The basic and diluted weighted
average number of shares outstanding and net earnings per share information for
2000 has been restated to reflect the effects of this stock dividend.

     The basic and diluted weighted average number of shares outstanding in 2000
have been restated to reflect a 1:1.1291 conversion ratio for discretionary
conversions of Class A shares to Class B shares, reflecting the change in the
Class A conversion ratio caused by the 1999 stock dividend on the Class B
shares. During 2001 and 2000, 117,500 and 726,754 Class A shares were converted
to 132,670 and 820,585 shares of Class B common stock, respectively. As of
December 31, 2001, no shares of Class A Common stock remain outstanding.

     The following table presents the computation of basic and diluted earnings
per share:

<Table>
<Caption>
                                                               YEAR ENDED      YEAR ENDED
                                                              DECEMBER 31,    DECEMBER 31,
                                                                  2001            2000
                                                              -------------   -------------
                                                              (IN THOUSANDS, EXCEPT SHARES
                                                               AND PER SHARE INFORMATION)
<S>                                                           <C>             <C>
Net Income..................................................   $    1,424      $      606
                                                               ----------      ----------
Weighted average number of shares of common stock...........    4,808,305       3,147,548
Additional dilutive shares related to stock options.........      203,691              --
                                                               ----------      ----------
Total weighted average common shares and equivalents
  outstanding for dilutive earnings per share computation...    5,011,996       3,147,548
                                                               ----------      ----------
Basic earnings per share....................................   $     0.30      $     0.19
Diluted earnings per share..................................   $     0.28      $     0.19
</Table>

  ADVERTISING COSTS

     The Bank expenses advertising costs as incurred. Advertising costs were $66
thousand and $53 thousand in 2001 and 2000, respectively.

  INCOME TAXES

     Income taxes are accounted for under the asset and liability method.
Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
basis and operating loss and tax credit carry forwards. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date.

                                        42
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  RECENTLY ISSUED ACCOUNTING STANDARDS

     In July 2001, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 141, "Business
Combinations", ("Statement 141") and SFAS No. 142, "Goodwill and Other
Intangible Assets," ("Statement 142"). Statement 141 requires that the purchase
method of accounting be used for all business combinations initiated after June
30, 2001. Statement 142 requires that goodwill and intangible assets with
indefinite useful lives no longer be amortized, but instead tested for
impairment at least annually in accordance with the provisions of Statement 142.
Other intangible assets would continue to be amortized over their estimated
useful lives. In the transition, any impairment losses will be measured as of
the date of adoption and recognized as the cumulative effect of a change in
accounting principle in the first interim period.

     The Company is required to adopt the provisions of Statement 141
immediately and the Company adopted Statement 142 effective January 1, 2002. As
of the date of adoption, the Company had unamortized goodwill in the amount of
approximately $3.2 million that is subject to the transition provisions of
Statements 141 and 142. Pursuant to Statement 142, the Company will no longer
amortize goodwill. Amortization expense related to goodwill was approximately
$153 thousand for each of the years ended December 31, 2001 and 2000. The
adoption of Statement 142 did not result in a transitional impairment loss.

     In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations" ("Statement 143"), which addresses financial accounting
and reporting for legal obligations associated with the retirement of tangible
long-lived assets and the associated asset retirement costs. Statement 143 is
effective for fiscal years beginning after June 15, 2002. This Statement is not
expected to have a material impact on the Company's financial statements.

     In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment of Long-Lived Assets" ("Statement 144") which supercedes SFAS No.
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of" ("Statement 121") and the accounting and reporting
provisions of APB No. 30, "Reporting the Results of Operations -- Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions," for the disposal of a segment
of a business. While Statement 144 retains many of the fundamental provisions of
Statement 121, it establishes a single accounting model for long-lived assets to
be disposed of by sale, and resolves certain implementation issues not
previously addressed by Statement 121. Statement 144 is effective for fiscal
years beginning after December 15, 2001. This Statement did not have a material
impact on the Company's financial statements.

                                        43
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 3 -- INVESTMENT SECURITIES

     The amortized cost and fair value of investment securities as of December
31, 2001 and 2000 are as follows (in thousands):

<Table>
<Caption>
                                                            GROSS        GROSS
                                              AMORTIZED   UNREALIZED   UNREALIZED    FAIR
AVAILABLE FOR SALE                              COST        GAINS        LOSSES      VALUE
------------------                            ---------   ----------   ----------   -------
<S>                                           <C>         <C>          <C>          <C>
December 31, 2001
U.S. Government and Agency Securities.......   $ 1,000       $ 29         $ --      $ 1,029
Mortgage-Backed Securities..................    16,800        144          (18)      16,926
Other Securities............................        14         --           --           14
                                               -------       ----         ----      -------
Total.......................................   $17,814       $173         $(18)     $17,969
                                               =======       ====         ====      =======
December 31, 2000
U.S. Government and Agency Securities.......   $ 7,500       $  7         $(30)     $ 7,477
Mortgage-Backed Securities..................     6,031        106           --        6,137
Other Securities............................        14         --           --           14
                                               -------       ----         ----      -------
Total.......................................   $13,545       $113         $(30)     $13,628
                                               =======       ====         ====      =======
</Table>

     A comparative summary of investment securities held to maturity for the
periods presented is as follows (in thousands):

<Table>
<Caption>
                                                            GROSS        GROSS
                                              AMORTIZED   UNREALIZED   UNREALIZED    FAIR
              HELD TO MATURITY                  COST        GAINS        LOSSES      VALUE
              ----------------                ---------   ----------   ----------   -------
<S>                                           <C>         <C>          <C>          <C>
December 31, 2001
U.S. Treasury Securities....................   $ 2,037       $ --         $ (6)     $ 2,031
U.S. Government and Agency Securities.......     4,002         45           (8)       4,039
Mortgage-Backed Securities..................    29,550        489          (26)      30,013
                                               -------       ----         ----      -------
Total.......................................   $35,589       $534         $(40)     $36,083
                                               =======       ====         ====      =======
December 31, 2000
U.S. Government and Agency Securities.......   $ 1,000       $  5         $ (1)     $ 1,004
Mortgage-Backed Securities..................    23,549        228           --       23,777
                                               -------       ----         ----      -------
Total.......................................   $24,549       $233         $ (1)     $24,781
                                               =======       ====         ====      =======
</Table>

     The carrying value of securities pledged to secure deposits and for other
purposes required or permitted by law amounted to $21.4 million and $28.1
million at December 31, 2001 and 2000, respectively.

                                        44
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The amortized cost and estimated fair value of the Company's investment and
mortgaged backed securities, by contractual maturity, are shown below. Expected
maturities will differ from contractual maturities because borrowers may have
the right to call or prepay obligations with or without call or prepayment
penalties.

<Table>
<Caption>
                                                               DECEMBER 31, 2001
                                                              -------------------
                                                              AVAILABLE FOR SALE
                                                              -------------------
                                                              AMORTIZED    FAIR
                                                                COST       VALUE
                                                              ---------   -------
                                                                (IN THOUSANDS)
<S>                                                           <C>         <C>
Due from one year to five years.............................   $ 1,000    $ 1,029
Mortgage-backed securities..................................    16,800     16,926
Other securities............................................        14         14
                                                               -------    -------
                                                               $17,814    $17,969
                                                               =======    =======
</Table>

<Table>
<Caption>
                                                               HELD TO MATURITY
                                                              -------------------
                                                              AMORTIZED    FAIR
                                                                COST       VALUE
                                                              ---------   -------
                                                                (IN THOUSANDS)
<S>                                                           <C>         <C>
Due from one year to five years.............................   $ 6,039    $ 6,070
Mortgage-backed securities..................................    29,550     30,013
                                                               -------    -------
                                                               $35,589    $36,083
                                                               =======    =======
</Table>

     No available for sale securities were sold during 2001. Proceeds from the
sales of securities available for sale during the year ended December 31, 2000
were $17 thousand.

NOTE 4 -- LOANS

     The following schedule presents the components of loans, by type, as of the
periods presented.

<Table>
<Caption>
                                                 DECEMBER 31, 2001    DECEMBER 31, 2000
                                                 ------------------   ------------------
                                                  AMOUNT    PERCENT    AMOUNT    PERCENT
                                                 --------   -------   --------   -------
                                                         (DOLLARS IN THOUSANDS)
<S>                                              <C>        <C>       <C>        <C>
Commercial and Industrial......................  $ 49,846      13%    $ 43,006      19%
Real Estate Non-Residential Properties.........   297,850      75%     147,996      67%
Residential Properties.........................    24,802       6%      19,399       9%
Construction...................................    17,771       4%       7,869       3%
Consumer*......................................     6,380       2%       3,424       2%
                                                 --------     ---     --------     ---
Gross loans....................................   396,649     100%     221,694     100%
less: net deferred fees........................     1,348                  684
                                                 --------             --------
Total loans....................................   395,301              221,010
less: allowance for loan losses................     4,844                2,381
                                                 --------             --------
Net loans......................................  $390,457             $218,629
                                                 ========             ========
</Table>

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

* Includes $819 thousand and $445 thousand in deposits reclassified as loans in
  2001 and 2000, respectively.

                                        45
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Changes in the allowance for loan losses are as follows:

<Table>
<Caption>
                                                         YEAR ENDED          YEAR ENDED
                                                      DECEMBER 31, 2001   DECEMBER 31, 2000
                                                      -----------------   -----------------
                                                             (DOLLARS IN THOUSANDS)
<S>                                                   <C>                 <C>
Balance at beginning of year........................       $2,381              $1,017
Provision for loan losses...........................        2,528               1,442
Charge-offs.........................................          (70)                (87)
Recoveries..........................................            5                   9
                                                           ------              ------
Ending Balance......................................       $4,844              $2,381
                                                           ======              ======
</Table>

     Loans with unpaid principal balances of $967 thousand and $402 thousand
were 90 days or more contractually delinquent or on nonaccrual status at
December 31, 2001 and 2000, respectively.

     The balance of impaired loans was $524 thousand and $402 thousand at
December 31, 2001 and 2000, respectively. The Bank has identified a loan as
impaired when it is probable that principal and interest will not be collected
according to the contractual terms of the loan agreement. The allowance for loan
loss associated with impaired loans was $148 thousand and $98 thousand at
December 31, 2001 and 2000, respectively. The average recorded investment in
impaired loans was approximately $442 thousand and $201 thousand for the years
ended December 31, 2001 and 2000, respectively. The Company recognized $18
thousand in income on impaired loans in 2001. Sixty four thousand dollars and $4
thousand cash was collected on impaired loans during 2001 and 2000 respectively.
Interest which would have been accrued on impaired loans for the years ended
December 31, 2001 and 2000, was $39 thousand and $11 thousand, respectively.

     A loan having a carrying value of $154 thousand was transferred to
foreclosed real estate in 2000. No loans were transferred to foreclosed real
estate in 2001.

NOTE 5 -- PREMISES AND EQUIPMENT

     Premises and equipment are summarized as follows:

<Table>
<Caption>
                                                                       DECEMBER 31,
                                                       ESTIMATED     -----------------
                                                      USEFUL LIVES    2001      2000
                                                      ------------   -------   -------
                                                                      (IN THOUSANDS)
<S>                                                   <C>            <C>       <C>
Land and improvements...............................                 $ 1,068   $     0
Furniture and equipment.............................   3 - 7 Years     4,161     2,995
Leasehold improvements..............................  5 - 15 Years     2,936     1,609
                                                                     -------   -------
                                                                     $ 8,165   $ 4,604
Accumulated depreciation and amortization...........                  (2,743)   (1,938)
                                                                     -------   -------
                                                                     $ 5,422   $ 2,666
                                                                     =======   =======
</Table>

                                        46
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 6 -- DEPOSITS

     Deposits are summarized as follows:

<Table>
<Caption>
                                                                 DECEMBER 31,
                                                              -------------------
                                                                2001       2000
                                                              --------   --------
                                                                (IN THOUSANDS)
<S>                                                           <C>        <C>
Non-interest bearing demand.................................  $ 63,988   $ 41,025
Savings, NOW and money market...............................   161,480     88,986
Time deposits, under $100,000...............................   111,402     63,607
Time deposits, $100,000 and over............................   112,274     67,697
                                                              --------   --------
                                                              $449,144   $261,315
                                                              ========   ========
</Table>

     At December 31, 2001, the scheduled maturities of time deposits are as
follows:

<Table>
<Caption>
                                                               (IN THOUSANDS)
<S>                                                            <C>
2002........................................................      $218,418
2003........................................................         3,088
2004........................................................           892
2005........................................................           473
2006........................................................           805
                                                                  --------
                                                                  $223,676
                                                                  ========
</Table>

NOTE 7 -- OTHER BORROWED FUNDS

     The Company has a $12 million unsecured Federal funds overnight borrowing
line of credit and a secured line of credit with a correspondent bank. At
December 31, 2001 no funds were drawn against this line. The Company's
unencumbered investment securities are the collateral for the secured line of
credit and serve to determine the total amount available under the line.

     The Company entered into a $9.0 million repurchase agreement during the
fourth quarter of 1999. The funds received in the repurchase transaction were
used toward the purchase of a $10.1 million, 20 year, FHLMC mortgage-backed
security which is classified as held to maturity. The borrowings under the
repurchase agreement mature as follows: $3.1 million in one year, $3.0 million
in two years and $2.9 million in three years. The cost of the one year borrowing
was 6.04%, the two year borrowing was at 6.25% and the third year borrowing is
at 6.45%. At each maturity date management evaluates whether to replace the
borrowings or pay them off using Company funds. The $3.0 million borrowing that
matured during 2001 was repaid out of funds raised in the deposit portfolio.

     Information concerning securities sold under agreements to repurchase
during the years ended December 31, 2001 and 2000 is summarized as follows:

<Table>
<Caption>
                                                                2001           2000
                                                              --------       --------
                                                              (DOLLARS IN THOUSANDS)
<S>                                                           <C>            <C>
Average balance during the year.............................   $5,292         $8,415
Weighted average interest rate during the year..............     6.36%          6.27%
Maximum month end balance during the year...................   $5,900         $9,000
Mortgage-backed securities underlying the agreements at year
  end:
Carrying value..............................................   $4,236         $7,130
Estimated fair value........................................   $4,298         $7,155
</Table>

                                        47
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Securities underlying the agreement were held by the counter party.

     The Company borrowed $9.4 million from the Federal Home Loan Bank of
Atlanta (FHLB) during February 2000. The funds received in the transaction were
used toward the purchase of a $10.0 million, 30 year, GNMA mortgage-backed
security which is pledged to secure the borrowing. The security was split evenly
between the held to maturity and available for sale portfolios. The carrying
value of the portion classified available for sale is $2.3 million and the
carrying value of the portion classified held to maturity is $2.2 million. The
borrowing originally matured 90 days after the initial transaction. At each
maturity date, management evaluates whether to replace the borrowings or pay
them off using Company funds. At December 31, 2001, the $1.0 million borrowing
was a 30 day note maturing January 28, 2002.

NOTE 8 -- INCOME TAXES

     Income tax expense is comprised of the following:

<Table>
<Caption>
                                                                 YEARS ENDED
                                                                DECEMBER 31,
                                                               ---------------
                                                                2001     2000
                                                               ------    -----
                                                               (IN THOUSANDS)
<S>                                                            <C>       <C>
Current
  Federal...................................................   $1,600    $ 691
  State.....................................................      273      118
                                                               ------    -----
                                                                1,873      809
                                                               ------    -----
Deferred
  Federal...................................................   $ (833)   $(381)
  State.....................................................     (134)     (65)
                                                               ------    -----
                                                                 (967)    (446)
                                                               ------    -----
Total income tax expense....................................   $  906    $ 363
                                                               ======    =====
</Table>

     The income tax provision reconciled to the tax computed at the statutory
federal rate was as follows:

<Table>
<Caption>
                                                                YEARS ENDED
                                                                DECEMBER 31,
                                                               --------------
                                                               2001     2000
                                                               -----    -----
                                                               (IN THOUSANDS)
<S>                                                            <C>      <C>
Tax at statutory rate of 34%................................   $792     $329
State taxes, net of federal tax benefit.....................     91       42
Non-deductible goodwill.....................................     52       52
Other non-deductible items..................................     12       14
Decrease in valuation allowance.............................    (50)     (75)
Other.......................................................      9        1
                                                               ----     ----
Total provision.............................................   $906     $363
                                                               ====     ====
</Table>

                                        48
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The net deferred tax asset consisted of the following:

<Table>
<Caption>
                                                                   DECEMBER 31,
                                                               ---------------------
                                                                   2001        2000
                                                               ------------    -----
                                                                  (IN THOUSANDS)
<S>                                                            <C>             <C>
Deferred tax assets (liabilities)
  Net operating loss carryforward...........................      $  308       $ 353
  Premises and equipment....................................         104          77
  Sale of SBA loans.........................................         (79)        (92)
  Allowance for loan losses.................................       1,630         678
  Unrealized gain on securities available for sale..........         (58)        (31)
  Loan origination costs....................................        (110)        (80)
                                                                  ------       -----
  Total deferred tax asset..................................       1,795         905
Valuation allowance.........................................         (81)       (131)
                                                                  ------       -----
  Net deferred tax asset....................................       1,714         774
Less: asset at beginning of year............................        (774)       (464)
Change in unrealized (loss) gain on securities available for
  sale......................................................          27         136
                                                                  ------       -----
Provision for deferred income taxes.........................      $  967       $ 446
                                                                  ======       =====
</Table>

     The valuation allowance for deferred tax assets as of December 31, 2001 and
2000 was $81 thousand and $131 thousand, respectively. The net change in the
total valuation allowance for the years ended December 31, 2001 and 2000 was a
decrease of $50 thousand and $75 thousand, respectively. In assessing the
realizability of deferred tax assets, management considers whether it is more
likely than not that some portion or all of the deferred tax assets will not be
realized. The ultimate realization of deferred tax assets is dependent upon the
generation of future taxable income during the periods in which those temporary
differences become deductible.

     At December 31, 2001, the Company had unused net operating loss
carryforwards of $820 thousand for Federal and Florida income tax purposes
expiring in various amounts from 2006 through 2008. The loss carryforward
reflects the maximum benefit that could be obtained from the net operating
losses due to limitations under Internal Revenue Code Section 382.

NOTE 9 -- STOCKHOLDERS' EQUITY

     The total authorized capital stock of Admiralty consists of 8,500,000
shares of common stock and 2,000,000 shares of preferred stock.

     Admiralty established Class A Common Stock which possess all such rights
and privileges as are afforded to capital stock by law and shall also possess
the following rights, privileges and limitations:

     DIVIDENDS

          The holder of each share of Class A Common Stock shall be entitled to
     receive out of any funds legally available therefore, when and as declared
     by the Board of Directors, preferential dividends thereon at the annual
     rate of ten percent (10%) per annum based upon a $10.00 per share stated
     value, payable semiannually on June 30 and December 31, or on such other
     date or dates as may be determined by the Board of Directors. Those
     dividends shall be non-cumulative and may be paid either in cash or in
     shares of the Company's Class B Common Stock, at the discretion of the
     Company's Board of Directors. No dividends shall be declared, or paid or
     set apart for payment on

                                        49
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     the Company's Class B Common Stock (described below) for any period unless
     the most recently required dividend is paid on the Class A Common Stock.
     Holders of shares of the Class A Common Stock shall not be entitled to any
     dividends, whether payable in cash, property or stock, in excess of the
     non-cumulative dividends, as herein provided, on the Class A Common Stock,
     unless specially declared by the Board of Directors.

     VOTING RIGHTS

          Holders of Class A Common Stock shall have the right to vote at any
     meeting of stockholders or otherwise and shall be entitled to notice of any
     such meeting. Each share of Class A Common Stock is entitled to one vote
     per share, and unless otherwise required by law, the Class A Common Stock
     will vote with the Class B Common Stock together as a single class.

     CONVERSION RIGHTS

          Voluntary Conversion:  Each share of Class A Common Stock is
     convertible, at the option of the holder, into one share of Class B Common
     Stock, at any time or from time to time.

          Involuntary Conversion:  In addition to the foregoing voluntary
     conversion rights, the Company has the right to require a holder of Class A
     Common Stock to convert the Class A Common Stock into Class B Common Stock,
     at the rate of one share of Class B Common Stock for each share of Class A
     Common Stock held, in the event that the Class B Common Stock trades at
     $15.00 or higher and does not trade below $15.00 for the next 20
     consecutive trading days. Upon the end of such 20 consecutive trading day
     period, the Company may issue a notice of mandatory conversion requiring
     the conversion of shares of the Class A Common Stock to Class B Common
     Stock within 20 days.

          The conversion rate set forth above is subject to adjustment in the
     event of payment of certain stock dividends, stock split-ups or
     combinations or other similar recapitalizations, to ensure that a holder of
     the Class A Common Stock does not have his interests in the Company diluted
     through such transaction. Due to a 12.91% stock dividend paid in January
     2000 to all stockholders of record on December 31, 2000, each share of
     Class A common stock is now convertible into 1.1291 shares of Class B
     common stock and the trading price for mandatory conversion is $13.28.

     During 2001, all outstanding shares of Class A Common Stock were
voluntarily converted to Class B Common Stock.

     Admiralty also established Class B Common Stock which possess all such
rights and privileges as are afforded to capital stock by law. Voting rights,
with regard to any items upon which the Class B Common Stock shall be required
or entitled to vote, the Class B Common Stock shall vote together with the Class
A Common Stock as a single class, except as otherwise required by law.

     On March 22, 1999, the Board of Directors resolved to treat both classes of
the Company's stock equally, in terms of the amount of dividends declared and
the form of payment of dividends. This resolution and new dividend policy was
effective January 1, 1999.

     The Company also had warrants outstanding to purchase 1,089,595 Class B
common stock at $9.74 per share for a period commencing January 22, 1998 and
ending January 21, 2002. The Company had the right to accelerate the expiration
date of the warrants in the event that (i) the Class B stock is traded on a
nationally recognized securities exchange or on the NASDAQ National or SmallCap
Market, and (ii) the Class B stock has traded at $13.28 or above and has not
traded below $13.28 per share for 20 consecutive trading days. These conditions
were met in the second quarter of 2001 and the Company elected to issue a notice
of acceleration to each warrant holder. The Company issued 1,079,907 shares of
Class B common stock for the warrants and warrants to purchase 9,688 shares of
common stock expired unexercised.

                                        50
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 10 -- COMMITMENTS AND CONTINGENCIES

 OPERATING LEASES

     The Bank utilizes certain office space and equipment under operating leases
expiring through 2011. Total rent expense under such operating leases, included
in occupancy expense, was $1.2 million and $751 thousand for the years ended
December 31, 2001 and 2000, respectively.

     Approximate minimum payments under non-cancelable operating leases for the
period ending December 31, are as follows:

<Table>
<Caption>
                                                              (IN THOUSANDS)
<S>                                                           <C>
2002........................................................      $1,027
2003........................................................       1,013
2004........................................................         849
2005........................................................         774
2006........................................................         747
Thereafter..................................................       2,421
                                                                  ------
                                                                  $6,831
                                                                  ======
</Table>

  OTHER

     The Bank is involved in certain litigation arising in the ordinary course
of business. In the opinion of management, the outcome of this litigation will
not have a significant effect on the accompanying financial statements.

NOTE 11 -- MANAGEMENT STOCK OPTION PLAN

     In May 1998, the Board of Directors of the Company approved the 1998
Management Stock Option Plan (the Management Plan), which provides for options
to purchase up to 391,514 shares (adjusted for the 1999 and 2001 stock
dividends) of Class B stock to be issued to members of the Board of Directors
and management of the Company, the Bank and any other subsidiaries which the
Company acquires or incorporates in the future.

     In November 2000, the Stockholders approved the Admiralty Bancorp, Inc.
2000 Stock Option Plan (the 2000 Plan) which provides for options to purchase up
to 383,276 shares (adjusted for the 2001 stock dividend) of Class B stock to be
issued to members of the Board of Directors and management of the Company, the
Bank and any other subsidiaries which the Company acquires or incorporates in
the future.

     The Management Plan and the 2000 Plan provide for the granting of both
incentive options and nonstatutory options. Incentive stock options may be
granted at an exercise price of not less than 100% of the fair market value of
the Class B stock on the date of the grant. The option price for nonstatutory
options may not be less than 100% of the fair market value of the Class B stock
on the date of grant. The Board of Directors has discretion to set the actual
exercise price of any option within the foregoing parameters. The options, which
have a term of 10 years when issued, vest either immediately or over a period
specified by the Board of Directors.

     As a result of the 5% stock dividend declared by the Board of Directors on
October 25, 2001, options outstanding and exercise prices have been adjusted to
restore option holders to their respective economic positions before the stock
dividend.

     The Management Plan and the 2000 Plan are fixed stock option plans
accounted for under APB Opinion No. 25 "Accounting for Stock Issued to
Employees" and related interpretations. Had

                                        51
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

compensation cost for the plans been determined based on the fair value of
options at the grant dates consistent with the method of SFAS No. 123,
"Accounting for Stock-Based Compensation," the Company's net earnings per share
for the Class B Common Stock would have been reduced to the pro forma amounts
indicated below for the periods presented.

<Table>
<Caption>
                                                                YEARS ENDED
                                                                DECEMBER 31,
                                                              ----------------
                                                               2001      2000
                                                              -------   ------
                                                               (IN THOUSANDS,
                                                              EXCEPT PER SHARE
                                                                   DATA)
<S>                                                           <C>       <C>
Net income (loss)
  As reported...............................................  $1,424    $ 606
  Pro forma.................................................  $ (285)   $ 385
Basic earnings (loss) per share
  As reported...............................................  $ 0.30    $0.19
  Pro forma.................................................  $(0.06)   $0.12
Diluted earnings (loss) per share
  As reported...............................................  $ 0.28    $0.19
  Pro forma.................................................  $(0.06)   $0.12
</Table>

     The fair value of each option grant is estimated on the date of grant using
the Black-Scholes option-pricing model with the following assumptions used for
grants in 2001: no dividend yield, expected volatility of 55% expected lives of
five years and a risk free rate of 4.94% for options granted in January 2001 and
4.70% for options granted in June 2001; and the following assumptions are used
for options granted in 2000: no dividend yield; expected volatility of 60%;
expected lives of five years for all options; and a weighted average risk free
interest rate of 5.68%.

     A summary of the status of the Company's fixed stock option plans as of
December 31, 2001 and 2000, and changes for the years then ended is as follows:

<Table>
<Caption>
                                                       YEARS ENDED DECEMBER 31,
                                          ---------------------------------------------------
                                                    2001                       2000
                                          ------------------------   ------------------------
                                                       WEIGHTED                   WEIGHTED
                                                       AVERAGE                    AVERAGE
                                          NUMBER    EXERCISE PRICE   NUMBER    EXERCISE PRICE
                                          -------   --------------   -------   --------------
<S>                                       <C>       <C>              <C>       <C>
Option outstanding at beginning of
  year..................................  447,959       $ 8.73       388,549       $8.63
Options granted.........................  326,823        11.49        59,410        9.40
Options exercised.......................    8,694         8.98            --          --
                                          -------       ------       -------       -----
Options outstanding at end of year......  766,088       $ 9.91       447,959       $8.73
                                          =======       ======       =======       =====
Options exercisable at end of year......  713,061       $ 9.88       437,459       $8.71
                                          =======       ======       =======       =====
Weighted average fair value of options
  granted during year...................                $ 6.03                     $4.82
                                                        ======                     =====
</Table>

                                        52
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The following table summarizes information about fixed stock options
outstanding at December 31, 2001:

<Table>
<Caption>
                                                                                    OPTIONS
                                                OPTIONS OUTSTANDING               EXERCISABLE
                                        ------------------------------------   -----------------
                                             NUMBER          WEIGHTED AVG.          NUMBER
                                         OUTSTANDING AT        REMAINING        EXERCISABLE AT
           EXERCISE PRICES              DECEMBER 31, 2001   CONTRACTUAL LIFE   DECEMBER 31, 2001
           ---------------              -----------------   ----------------   -----------------
<S>                                     <C>                 <C>                <C>
$13.33................................       169,323           9.5 years            158,296
$ 9.52................................       212,370           9.0 years            170,370
$ 8.86................................       325,084           6.6 years            325,084
$ 8.85................................         1,188           6.8 years              1,188
$ 7.23................................        51,599           7.8 years             51,599
$ 7.22................................           594           7.8 years                594
$ 7.17................................         5,930           8.0 years              5,930
                                             -------                                -------
                                             766,088                                713,061
                                             =======                                =======
</Table>

     The Black-Scholes option pricing model was developed for use in estimating
the fair value of traded options that have no vesting restrictions and are fully
transferable. In addition, option pricing models require the use of highly
subjective assumptions, including the expected stock price volatility. Because
the Company's stock options have characteristics significantly different from
those of traded options, and because changes in the subjective assumptions can
materially affect the fair value estimates, in management's opinion, the
existing models do not provide a reliable measure of the fair value of its
options.

NOTE 12 -- RELATED PARTY TRANSACTIONS

     The Bank has made in the past and, assuming continued satisfaction of
generally applicable credit standards, expects to continue to make loans to
directors, executive officers and their associates, (i.e., corporations or
organizations for which they serve as officers or directors or in which they
have beneficial ownership interests of ten percent or more). These loans have
all been made in the ordinary course of the Bank's business on substantially the
same terms, including interest rates and collateral, as those prevailing at the
time for comparable transactions with other persons and do not involve more than
the normal risk of collectibility or present other unfavorable features. The
aggregate dollar amount of these loans was $4.6 million and $6.0 million at
December 31, 2001 and 2000, respectively. For the year ended December 31, 2001,
$481 thousand in funds were disbursed and $1.8 million of principal repayments
were received. In addition, Bank Directors and Officers keep depository balances
with the Bank. At December 31, 2001 the aggregate balance of these deposits was
$4.6 million.

     The Bank's branches in Boca Raton and Jupiter are leased from entities
owned by certain members of the Company's Board of Directors. The aggregate
rental payment due under these two leases will be approximately $262 thousand
per year. Each of these leases had an original term of ten years. However, in
the event of a change in control of the Company, the lease term will be reset
and extended to a term of ten years from the date of the change in control. The
Company believes that these leases represent fair market value, and are
comparable to terms which the Bank could have obtained from unaffiliated
parties.

NOTE 13 -- FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK AND CONCENTRATION
OF CREDIT RISKS

     The Bank is a party to financial instruments with off-balance-sheet risk in
the normal course of business to meet the financing needs of its customers.
These financial instruments include commitments to extend credit and standby
letters of credit and financial guarantees. Those instruments involve, to
varying

                                        53
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

degrees, elements of credit and interest rate risk in excess of the amount
recognized in the balance sheets. The contract or notional amounts of those
instruments reflect the extent of the Bank's involvement in particular classes
of financial instruments.

     The Bank's exposure to credit loss in the event of non-performance by the
other party to the financial instrument for commitments to extend credit,
standby letters of credit and financial guarantees written is represented by the
contractual notional amount of those instruments. The Bank uses the same credit
policies in making commitments and conditional obligations as it does for
on-balance-sheet instruments.

     The Bank does not always require collateral or other security to support
financial instruments with credit risk. The approximate contract amounts are as
follows:

<Table>
<Caption>
                                                                DECEMBER 31,
                                                              -----------------
                                                               2001      2000
                                                              -------   -------
                                                               (IN THOUSANDS)
<S>                                                           <C>       <C>
Unfunded lines of credit....................................  $49,455   $28,397
Standby letters of credit...................................    6,756     1,846
Unfunded construction loan commitments......................    8,694    22,278
Unfunded commercial loan commitments........................   16,525    16,424
</Table>

     Commitments to extend credit are agreements to lend to a customer as long
as there is no violation of any condition established in the contract.
Commitments generally have fixed expiration dates or other termination clauses
and may require payment of a fee. The lives of the commitments vary widely but
on average are about one to two years. Since many of the commitments are
expected to expire without being drawn upon, the total commitment amounts do not
necessarily represent future cash requirements. The Bank evaluates each
customer's creditworthiness on a case-by-case basis. The amount of collateral
obtained, if it is deemed necessary by the Bank upon extension of credit, is
based on management's credit evaluation of the counter party. Collateral held
varies but may include accounts receivable; inventory; property, plant, and
equipment; and income-producing commercial properties.

     Standby letters of credit and financial guarantees written are conditional
commitments issued by the Bank to guarantee the performance of a customer to a
third party. Those guarantees are primarily issued to support public and private
borrowing arrangements.

     The Bank has not been required to perform on any financial guarantees
during the past year. The Bank has not incurred any losses on its commitments in
2001 or 2000.

NOTE 14 -- FAIR VALUE OF FINANCIAL INSTRUMENTS

     SFAS No. 107, "Disclosures about Fair Value of Financial Instruments,"
requires entities to disclose the estimated fair value of their assets and
liabilities considered to be financial instruments. For the Bank, as for most
financial institutions, the majority of its assets and liabilities are
considered financial instruments as defined in SFAS No. 107. However, many such
instruments lack an available trading market, as characterized by a willing
buyer and seller engaging in an exchange transaction. Also, it is the Company's
general practice and intent to hold its financial instruments to maturity and to
not engage in trading or significant sales activities. Therefore, the Company
had to use significant estimations and present value calculations to prepare
this disclosure.

     Changes in the assumptions or methodologies used to estimate fair values
may materially affect the estimated amounts. Also, management is concerned that
there may not be reasonable comparability between institutions due to the wide
range of permitted assumptions and methodologies in the absence of active
markets. This lack of uniformity gives rise to a high degree of subjectivity in
estimating financial instrument fair values.

                                        54
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Fair values have been estimated using data which management considered the
best available, as generally provided by estimation methodologies deemed
suitable for the pertinent category of financial instrument. The estimation
methodologies, resulting fair values and recorded carrying amounts are as
follows:

     Fair value of loans and deposits with floating interest rates is generally
presumed to approximate the recorded carrying amounts.

     Fair value of financial instruments actively traded in a secondary market
has been estimated using quoted market prices.

<Table>
<Caption>
                                             DECEMBER 31, 2001           DECEMBER 31, 2000
                                         -------------------------   -------------------------
                                         CARRYING   ESTIMATED FAIR   CARRYING   ESTIMATED FAIR
                                          AMOUNT        VALUE         AMOUNT        VALUE
                                         --------   --------------   --------   --------------
                                                            (IN THOUSANDS)
<S>                                      <C>        <C>              <C>        <C>
Cash and cash equivalents..............  $37,492       $37,492       $33,445       $33,445
                                         =======       =======       =======       =======
Investment securities, including
  Federal Reserve Bank and FHLB
  stock................................  $55,565       $56,059       $39,514       $39,746
                                         =======       =======       =======       =======
</Table>

     The fair value of the total loan portfolio has been estimated using present
value cash flows, discounted at the approximate current market rates adjusted
for non-interest operating costs, and giving consideration to estimated
prepayment risk and credit loss factors.

<Table>
<Caption>
                                           DECEMBER 31, 2001           DECEMBER 31, 2000
                                       -------------------------   -------------------------
                                       CARRYING   ESTIMATED FAIR   CARRYING   ESTIMATED FAIR
                                        AMOUNT        VALUE         AMOUNT        VALUE
                                       --------   --------------   --------   --------------
                                                          (IN THOUSANDS)
<S>                                    <C>        <C>              <C>        <C>
Loans................................  $390,457      $391,382      $218,629      $219,410
                                       ========      ========      ========      ========
</Table>

     Fair value of financial instruments with stated maturities has been
estimated using present value cash flow, discounted at a rate approximating
current market for similar assets and liabilities. Fair value of financial
instrument liabilities with no stated maturities has been estimated to equal the
carrying amount (the amount payable on demand).

<Table>
<Caption>
                                           DECEMBER 31, 2001           DECEMBER 31, 2000
                                       -------------------------   -------------------------
                                       CARRYING   ESTIMATED FAIR   CARRYING   ESTIMATED FAIR
                                        AMOUNT        VALUE         AMOUNT        VALUE
                                       --------   --------------   --------   --------------
                                                          (IN THOUSANDS)
<S>                                    <C>        <C>              <C>        <C>
Deposits with stated maturities......  $223,676      $222,032      $131,304      $130,315
                                       ========      ========      ========      ========
Deposits with no stated maturities...  $225,468      $225,468      $130,011      $130,011
                                       ========      ========      ========      ========
Borrowing with stated maturities.....  $  3,900      $  3,809      $  9,900      $  9,835
                                       ========      ========      ========      ========
</Table>

     The fair value of commitments to originate loans and other off-balance
sheet instruments is estimated using fees currently charged to enter into
similar agreements taking into account the remaining terms of the agreements and
the present creditworthiness of the counter parties. For fixed rate loan
commitments, the fair value also considers the difference between current levels
of interest and the committed rates. As of December 31, 2001 and 2000 the fair
value of these commitments, which are primarily comprised of floating rate loan
commitments priced to market at funding, with notional amounts of $56.3 million
and $67.5 million respectively, was immaterial.

     The fair value of other financial instruments, including interest
receivable and interest payable, approximates the carrying value due to the
short term nature of these instruments.

                                        55
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 15 -- REGULATORY MATTERS

     The Bank, as a state-chartered, Federal Reserve member bank, is subject to
regulatory dividend restrictions. Under such restrictions, the Bank may not,
without prior regulatory approval, declare cash dividends.

     The Bank is subject to various regulatory and capital requirements
administered by the federal banking agencies. Failure to meet minimum capital
requirements can initiate certain mandatory -- and possibly additional
discretionary -- actions by the 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 capital 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 (set forth in the
following table) of total and Tier I capital (as defined in the regulations) to
risk-weighted assets (as defined), and of Tier I capital (as defined) to average
assets (as defined). Management believes, as of December 31, 2001, that the Bank
meets all capital adequacy requirements to which it is subject.

     The most recent notification from the regulators, dated June 30, 2001,
categorized the Bank as well capitalized under the regulatory framework for
prompt corrective action. To be categorized as well capitalized, the Bank must
maintain minimum total risk-based, Tier I risk-based and Tier I leverage as set
forth in the table. There are no conditions or events since that notification
that management believes have changed the institution's category. The Company's
federal regulators impose capital standards on bank holding companies which are
substantially similar to those imposed upon the Bank. The Company's and the
Bank's actual capital amounts and ratios are as follows:

                            ADMIRALTY BANCORP, INC.
                               DECEMBER 31, 2001

<Table>
<Caption>
                                                                             TO BE WELL
                                                                          CAPITALIZED UNDER
                                                        FOR CAPITAL       PROMPT CORRECTIVE
                                       ACTUAL        ADEQUACY PURPOSES    ACTION PROVISIONS
                                   ---------------   ------------------   -----------------
                                                    (DOLLARS IN THOUSANDS)
<S>                                <C>       <C>     <C>         <C>      <C>        <C>
Total Capital (to risk weighted
  assets)........................  $44,558   10.40%  >$34,263    >8.00%   >$42,829   >10.00%
                                                     -           -        -          -
Tier I Capital (to risk weighted
  assets)........................  $39,714    9.27%  >$17,132    >4.00%   >$25,697   > 6.00%
                                                     -           -        -          -

Tier I Capital (to average
  assets)........................  $39,714    8.08%  >$19,652    >4.00%   >$24,566   > 5.00%
                                                     -           -        -          -

</Table>

                                        56
<PAGE>
                     ADMIRALTY BANCORP, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

                            ADMIRALTY BANCORP, INC.
                               DECEMBER 31, 2000

<Table>
<Caption>
                                                                             TO BE WELL
                                                                          CAPITALIZED UNDER
                                                        FOR CAPITAL       PROMPT CORRECTIVE
                                       ACTUAL        ADEQUACY PURPOSES    ACTION PROVISIONS
                                   ---------------   ------------------   -----------------
                                                    (DOLLARS IN THOUSANDS)
<S>                                <C>       <C>     <C>         <C>      <C>        <C>
Total Capital (to risk weighted
  assets)........................  $27,419   11.14%  >$19,682    >8.00%   >$24,603   >10.00%
                                                     -           -        -          -
Tier I Capital (to risk weighted
  assets)........................  $25,038   10.18%  > $9,841    >4.00%   >$14,762   > 6.00%
                                                     -           -        -          -
Tier I Capital (to average
  assets)........................  $25,038    9.61%  >$10,419    >4.00%   >$13,024   > 5.00%
                                                     -           -        -          -
</Table>

                                 ADMIRALTY BANK
                               DECEMBER 31, 2001

<Table>
<Caption>
                                                                             TO BE WELL
                                                                          CAPITALIZED UNDER
                                                        FOR CAPITAL       PROMPT CORRECTIVE
                                       ACTUAL        ADEQUACY PURPOSES    ACTION PROVISIONS
                                   ---------------   ------------------   -----------------
                                                    (DOLLARS IN THOUSANDS)
<S>                                <C>       <C>     <C>         <C>      <C>        <C>
Total Capital (to risk weighted
  assets)........................  $44,047   10.29%  >$34,253    >8.00%   >$42,816   >10.00%
                                                     -           -        -          -
Tier I Capital (to risk weighted
  assets)........................  $39,203    9.16%  >$17,126    >4.00%   >$25,690   > 6.00%
                                                     -           -        -          -
Tier I Capital (to average
  assets)........................  $39,203    7.99%  >$19,637    >4.00%   >$24,546   > 5.00%
                                                     -           -        -          -
</Table>

                                 ADMIRALTY BANK
                               DECEMBER 31, 2000

<Table>
<Caption>
                                                                             TO BE WELL
                                                                          CAPITALIZED UNDER
                                                        FOR CAPITAL       PROMPT CORRECTIVE
                                       ACTUAL        ADEQUACY PURPOSES    ACTION PROVISIONS
                                   ---------------   ------------------   -----------------
                                                    (DOLLARS IN THOUSANDS)
<S>                                <C>       <C>     <C>         <C>      <C>        <C>
Total Capital (to risk weighted
  assets)........................  $27,066   11.00%  >$19,680    >8.00%   >$24,599   >10.00%
                                                     -           -        -          -
Tier I Capital (to risk weighted
  assets)........................  $24,685   10.03%  > $9,840    >4.00%   >$14,760   > 6.00%
                                                     -           -        -          -
Tier I Capital (to average
  assets)........................  $24,685    9.48%  >$10,419    >4.00%   >$13,024   > 5.00%
                                                     -           -        -          -
</Table>

                                        57
<PAGE>

                                   SIGNATURES

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

<Table>
<Caption>
                    NAME                                     TITLE                       DATE
                    ----                                     -----                       ----
<S>                                             <C>                                <C>
              /s/ WARD KELLOGG                   President and Chief Executive     February 22, 2002
  -----------------------------------------                 Officer
                Ward Kellogg

             /s/ KEVIN M. SACKET                Treasurer (Principal Accounting    February 22, 2002
  -----------------------------------------          and Financial Officer)
               Kevin M. Sacket

             /s/ BRUCE A. MAHON                      Chairman of the Board         February 22, 2002
  -----------------------------------------
               Bruce A. Mahon

             /s/ WILLIAM BERGER                             Director               February 22, 2002
  -----------------------------------------
               William Berger

             /s/ RANDY O. BURDEN                            Director               February 22, 2002
  -----------------------------------------
               Randy O. Burden

           /s/ DAVID B. DICKENSON                           Director               February 22, 2002
  -----------------------------------------
             David B. Dickenson

            /s/ LESLIE E. GOODMAN                           Director               February 22, 2002
  -----------------------------------------
              Leslie E. Goodman

           /s/ THOMAS L. GRAY, JR.                          Director               February 22, 2002
  -----------------------------------------
             Thomas L. Gray, Jr.

            /s/ THOMAS J. HANFORD                           Director               February 22, 2002
  -----------------------------------------
              Thomas J. Hanford

            /s/ SIDNEY L. HOFING                   Vice Chairman of the Board      February 22, 2002
  -----------------------------------------
              Sidney L. Hofing

            /s/ DOUGLAS P. HOOKER                           Director               February 22, 2002
  -----------------------------------------
              Douglas P. Hooker

         /s/ PATRICK C. MATHES, III                         Director               February 22, 2002
  -----------------------------------------
           Patrick C. Mathes, III

           /s/ PETER L.A. PANTAGES                          Director               February 22, 2002
  -----------------------------------------
             Peter L.A. Pantages

             /s/ RICHARD P. ROSA                            Director               February 22, 2002
  -----------------------------------------
               Richard P. Rosa

            /s/ CRAIG A. SPENCER                            Director               February 22, 2002
  -----------------------------------------
              Craig A. Spencer
</Table>

                                        58
<PAGE>

<Table>
<Caption>
                    NAME                                     TITLE                       DATE
                    ----                                     -----                       ----

<S>                                             <C>                                <C>
          /s/ JOSEPH W. VECCIA, JR.                         Director               February 22, 2002
  -----------------------------------------
            Joseph W. Veccia, Jr.

             /s/ MARK A. WOLTERS                            Director               February 22, 2002
  -----------------------------------------
               Mark A. Wolters

           /s/ GEORGE R. ZOFFINGER                          Director               February 22, 2002
  -----------------------------------------
             George R. Zoffinger
</Table>

                                        59