##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON,
D.C. 20549
 FORM 10-K
 ANNUAL REPORT UNDER SECTION 13 OF THE SECURITIES
EXCHANGE ACT OF 1934
 FOR THE FISCAL YEAR ENDED
DECEMBER 31, 2005
 Commission
File Number (333-60283)
 FIRST NATIONAL BANCSHARES, INC.
  State of Florida
    
    06-1522028(Jurisdiction of Incorporation)
    
    (I.R.S. Employer Identification No.)
 5817 Manatee Avenue West, Bradenton, Florida 34209
 Registrants telephone number, including area code (941) 794-6969
  Name of each exchangeTitle of each Class
    
    on which registeredN/A
    
    None
  o þ
 o þ
  þ o
 þ
  o o þ
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE
    
    Part of Form 10-K intoin this Form 10-K
    
    which incorporatedNone
    
    None




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TABLE OF CONTENTS  PART IITEM 1. BUSINESSITEM 1A RISK FACTORSITEM 2 PROPERTIESITEM 3 LEGAL PROCEEDINGSITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSPART IIITEM 5. MARKET FOR THE COMMON STOCK AND RELATED SECURITY HOLDER MATTERSItem 6. SELECTED FINANCIAL DATAITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATAITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSUREITEM 9A. CONTROLS AND PROCEDURESPART IIIITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANYItem 11. EXECUTIVE COMPENSATIONItem 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder MattersItem 13. Certain Relationships and Related TransactionsItem 14. Principal Accountant Fees and ServicesITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTSON FORM 8-KSIGNATURESEXHIBIT INDEXEx-21 SubsidiariesEx-31.1 Section 302 CertificationEx-31.2 Section 302 CertificationEx-32.1 Section 906 CertificationEx-32.2 Section 906 CertificationEx-99 Audited Financial Statements    Table of Contents  
  
 BUSINESS
 General Development of Business
 st
     Financial Information
  Narrative Description of Business
 Banking Services
   st
  1




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rd th
   Operating Strategy
       Market Area
   Competition
  2




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Loan Commitments
  Financial History
  Employees
  Supervision and Regulation
 General
  3




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Regulatory Agencies
   The Holding Company
 Investments and Activities
 Affiliate Transactions
 Control Acquisitions
 Gramm-Leach-Bliley Act
 The Sarbanes-Oxley Act of 2002
 4




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The Bank
 Interstate Banking and Branching
 Control Acquisitions
 Liability for Banking Subsidiaries
 Capital Requirements .
  5




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Dividend Restrictions
 Deposit Insurance Assessments
 Depositor Preference
 Privacy Provisions of Gramm-Leach-Bliley Act
 Anti-Money Laundering Provisions of the USA Patriot Act of 2001
 Fiscal and Monetary Policies
 6




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Additional Regulation. The Bank is also subject to federal regulation as to such matters
as required reserves, limitation as to the nature and amount of its loans and investments,
regulatory approval of any merger or consolidation, issuance or retirement of their own
securities, limitations upon the payment of dividends and other aspects of banking
operations. In addition, the activities and operations of the Bank are subject to a number
of additional detailed, complex and sometimes overlapping laws and regulations. These
include state usury and consumer credit laws, state laws relating to fiduciaries, the Federal
Truth-in-Lending Act and Regulation Z, the Federal Equal Credit Opportunity Act and
Regulation B, the Fair Credit Reporting Act, the Truth in Savings Act, the Community
Reinvestment Act, anti-redlining legislation and antitrust laws.
 Future Legislation
 
 RISK FACTORS
 We have entered into an Agreement to merge with Whitney Holding Corporation.
     7




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There is intense and significant competition in the financial services sector.
  Our business is based upon lending money and there is a risk of non-repayment.
  We are engaged in a heavily regulated industry, therefore any changes in governmental laws,
regulations or policies could limit our future growth.
  Our profitability is directly related to interest rates, therefore any changes in these rates may
adversely affect our earnings and financial condition.
  Our ability to pay dividends is subject to regulatory limitations.
  8




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Our internal operations are subject to a number of risks.
  
 PROPERTIES
    
 LEGAL PROCEEDINGS
  9




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SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
 PART II
 
 MARKET FOR THE COMMON STOCK AND RELATED SECURITY HOLDER MATTERS
  Years Ended December 31,2005
    
    2004Fourth
    
    Third
    
    Second
    
    First
    
    Fourth
    
    Third
    
    Second
    
    FirstQuarter
    
    Quarter
    
    Quarter
    
    Quarter
    
    Quarter
    
    Quarter
    
    Quarter
    
    QuarterMarket Price RangeHigh
    
    $
    33.98
    
    
    $
    33.75
    
    
    $
    33.75
    
    
    $
    26.00
    
    
    $
    26.40
    
    
    $
    28.20
    
    
    $
    22.54
    
    
    $
    23.49Low
    
    $
    31.14
    
    
    $
    24.00
    
    
    $
    22.91
    
    
    $
    22.00
    
    
    $
    24.00
    
    
    $
    19.40
    
    
    $
    16.51
    
    
    $
    14.33
   th
 10




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Equity Compensation Plan Information
  Number of securitiesremaining available forNumber of securities to be
    
    
    
    
    
    
    future issuance under equityissued upon exercise of
    
    
    Weighted-average exercise
    
    
    compensation plansoutstanding options,
    
    
    price of outstanding options,
    
    
    (excluding securitiesPlan Category
    
    warrants and rights
    
    
    warrants and rights
    
    
    reflected in column (a)(a)
    
    
    (b)
    
    
    (c)Equity compensation
plans approved by
security holders
    
    
    122,286
    
    
    $
    17.51
    
    
    
    221,693Equity compensation
plans not approved
by security holders
    
    
    0
    
    
    
    0
    
    
    
    0Total
    
    
    122,286
    
    
    $
    17.51
    
    
    
    221,693
 
 11




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SELECTED FINANCIAL DATA
 SELECTED INCOME DATA
Years Ended December 31,
 2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001Interest income
    
    $
    20,215
    
    
    $
    15,760
    
    
    $
    12,617
    
    
    $
    13,026
    
    
    $
    14,164Interest expense
    
    
    7,166
    
    
    
    4,305
    
    
    
    3,144
    
    
    
    3,796
    
    
    
    6,699Net interest income
    
    
    13,049
    
    
    
    11,455
    
    
    
    9,473
    
    
    
    9,230
    
    
    
    7,465Provision for loan losses
    
    
    481
    
    
    
    314
    
    
    
    448
    
    
    
    321
    
    
    
    250Net interest income afterProvision for loan losses
    
    
    12,568
    
    
    
    11,141
    
    
    
    9,025
    
    
    
    8,909
    
    
    
    7,215Other non-interest income
    
    
    2,653
    
    
    
    2,315
    
    
    
    1,867
    
    
    
    1,645
    
    
    
    1,847Other non-interest expenses
    
    
    9,862
    
    
    
    8,511
    
    
    
    7,621
    
    
    
    6,672
    
    
    
    6,209Income before income taxes
    
    
    5,359
    
    
    
    4,945
    
    
    
    3,271
    
    
    
    3,882
    
    
    
    2,852Provision for income taxes
    
    
    1,902
    
    
    
    1,764
    
    
    
    1,120
    
    
    
    1,348
    
    
    
    975Net income (loss)
    
    $
    3,457
    
    
    $
    3,181
    
    
    $
    2,151
    
    
    $
    2,534
    
    
    $
    1,877Earnings per share *
    
    $
    1.03
    
    
    $
    0.98
    
    
    $
    0.69
    
    
    $
    0.83
    
    
    $
    0.62Diluted Earnings per share*
    
    $
    0.98
    
    
    $
    0.92
    
    
    $
    0.64
    
    
    $
    0.77
    
    
    $
    0.58Cash dividends declared
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/AStock dividends declared
    
    
    0
    %
    
    
    5
    %
    
    
    5
    %
    
    
    5
    %
    
    
    5
    %
 SELECTED BALANCE SHEET DATA
YEAR ENDED DECEMBER 31
 2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001Total assets
    
    $
    378,691
    
    
    $
    317,607
    
    
    $
    277,232
    
    
    $
    222,161
    
    
    $
    212,471Average total assets
    
    
    350,840
    
    
    
    300,333
    
    
    
    236,581
    
    
    
    214,652
    
    
    
    203,218Net investment securities
    
    
    73,052
    
    
    
    59,497
    
    
    
    47,113
    
    
    
    41,781
    
    
    
    37,903Net loans
    
    
    280,974
    
    
    
    233,395
    
    
    
    204,314
    
    
    
    156,590
    
    
    
    144,302Total deposits
    
    
    324,966
    
    
    
    268,782
    
    
    
    233,327
    
    
    
    180,512
    
    
    
    175,849Repurchase agreements &
other borrowed money
    
    
    20,671
    
    
    
    20,593
    
    
    
    20,801
    
    
    
    20,311
    
    
    
    17,966Capital lease obligation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    414Total stockholders equity
    
    
    31,134
    
    
    
    26,855
    
    
    
    22,015
    
    
    
    19,996
    
    
    
    17,047Book value per share *
    
    
    9.15
    
    
    
    8.17
    
    
    
    7.01
    
    
    
    6.55
    
    
    
    5.62Average total equity
    
    
    29,063
    
    
    
    24,850
    
    
    
    21,185
    
    
    
    18,571
    
    
    
    16,022Average common shares
Outstanding *
    
    
    3,351
    
    
    
    3,254
    
    
    
    3,132
    
    
    
    3,043
    
    
    
    3,029
 
  12




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Distribution of Assets, Liabilities and Stockholders Equity; Interest Rates and Interest
Differential:
 DECEMBER 31(000s)2005
    
    
    2004
    
    
    2003AVERAGE
    
    
    
    
    
    
    YIELD/
    
    
    AVERAGE
    
    
    
    
    
    
    YIELD/
    
    
    AVERAGE
    
    
    
    
    
    
    YIELD/BALANCE
    
    
    INTEREST
    
    
    RATE
    
    
    BALANCE
    
    
    INTEREST
    
    
    RATE
    
    
    BALANCE
    
    
    INTEREST
    
    
    RATEInterest-earning assets:Loans*
    
    $
    256,818
    
    
    $
    17,301
    
    
    
    6.74
    %
    
    $
    223,633
    
    
    $
    13,785
    
    
    
    6.16
    %
    
    $
    169,677
    
    
    $
    10,933
    
    
    
    6.44
    %Taxable investmentSecurities
    
    $
    54,015
    
    
    $
    2,141
    
    
    
    3.96
    %
    
    $
    42,507
    
    
    $
    1,494
    
    
    
    3.51
    %
    
    $
    32,650
    
    
    $
    1,210
    
    
    
    3.71
    %Tax-exempt investmentSecurities
    
    $
    12,438
    
    
    $
    470
    
    
    
    3.78
    %
    
    $
    9,206
    
    
    $
    341
    
    
    
    3.70
    %
    
    $
    10,122
    
    
    $
    377
    
    
    
    3.72
    %Other Securities
    
    $
    1,778
    
    
    $
    79
    
    
    
    4.44
    %
    
    $
    1,238
    
    
    $
    51
    
    
    
    4.12
    %Federal funds sold &
Interest bearing bank
Balances
    
    $
    15,086
    
    
    $
    224
    
    
    
    1.48
    %
    
    $
    7,348
    
    
    $
    89
    
    
    
    1.21
    %
    
    $
    8,866
    
    
    $
    96
    
    
    
    1.08
    %Total interest-earning assets
    
    $
    340,135
    
    
    $
    20,215
    
    
    
    5.94
    %
    
    $
    283,932
    
    
    $
    15,760
    
    
    
    5.55
    %
    
    $
    221,315
    
    
    $
    12,616
    
    
    
    5.70
    %Non-interest-earning assets:Cash and due from banks
    
    $
    1,746
    
    
    
    
    
    
    
    
    
    
    $
    8,293
    
    
    
    
    
    
    
    
    
    
    $
    6,985Premises and equipment (net)
    
    $
    7,478
    
    
    
    
    
    
    
    
    
    
    $
    7,583
    
    
    
    
    
    
    
    
    
    
    $
    7,884Other assets
    
    $
    5,207
    
    
    
    
    
    
    
    
    
    
    $
    3,046
    
    
    
    
    
    
    
    
    
    
    $
    2,450Less allowance for loan
losses, deferred fees &
securities market valuation
    
    ($
    3,726
    )
    
    
    
    
    
    
    
    
    
    $
    (2,521
    )
    
    
    
    
    
    
    
    
    
    
    ($2,053
    )TOTAL
    
    $
    350,840
    
    
    
    
    
    
    
    
    
    
    $
    300,333
    
    
    
    
    
    
    
    
    
    
    $
    236,581
 13




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DECEMBER 31(000s)2005
    
    
    2004
    
    
    2003AVERAGE
    
    
    
    
    
    
    YIELD/
    
    
    AVERAGE
    
    
    
    
    
    
    YIELD/
    
    
    AVERAGE
    
    
    
    
    
    
    YIELD/BALANCE
    
    
    INTEREST
    
    
    RATE
    
    
    BALANCE
    
    
    INTEREST
    
    
    RATE
    
    
    BALANCE
    
    
    INTEREST
    
    
    RATELIABILITIES AND STOCKHOLDERS EQUITYInterest-bearing liabilities:Demand deposits
    
    $
    39,783
    
    
    $
    103
    
    
    
    0.26
    %
    
    $
    45,120
    
    
    $
    252
    
    
    
    0.56
    %
    
    $
    36,960
    
    
    $
    194
    
    
    
    0.52
    %Savings deposits
    
    $
    103,644
    
    
    $
    2,605
    
    
    
    2.51
    %
    
    $
    85,809
    
    
    $
    946
    
    
    
    1.10
    %
    
    $
    63,031
    
    
    $
    579
    
    
    
    0.92
    %Time deposits
    
    $
    116,005
    
    
    $
    3,760
    
    
    
    3.24
    %
    
    $
    92,213
    
    
    $
    2,516
    
    
    
    2.73
    %
    
    $
    67,207
    
    
    $
    1,988
    
    
    
    2.96
    %Federal
funds purchased & other borrowed money
    
    $
    17,255
    
    
    $
    589
    
    
    
    3.41
    %
    
    $
    15,331
    
    
    $
    504
    
    
    
    3.29
    %
    
    $
    5,984
    
    
    $
    226
    
    
    
    3.78
    %Repurchase agreements
    
    $
    3,565
    
    
    $
    109
    
    
    
    3.06
    %
    
    $
    5,174
    
    
    $
    87
    
    
    
    1.68
    %
    
    $
    15,985
    
    
    $
    157
    
    
    
    0.98
    %Other
    
    $
    0
    
    
    $
    0
    
    
    
    0.00
    %
    
    $
    0
    
    
    $
    0
    
    
    
    N/A
    
    
    $
    0
    
    
    $
    0
    
    
    
    N/ATotal interest-bearingLiabilities
    
    $
    280,252
    
    
    $
    7,166
    
    
    
    2.56
    %
    
    $
    243,647
    
    
    $
    4,305
    
    
    
    1.77
    %
    
    $
    189,167
    
    
    $
    3,144
    
    
    
    1.66
    %Non-interest-bearing liabilities:Demand deposits
    
    $
    39,307
    
    
    
    
    
    
    
    
    
    
    $
    30,133
    
    
    
    
    
    
    
    
    
    
    $
    24,760Other liabilities
    
    $
    2,218
    
    
    
    
    
    
    
    
    
    
    $
    1,704
    
    
    
    
    
    
    
    
    
    
    $
    1,469Total Liabilities
    
    $
    321,777
    
    
    
    
    
    
    
    
    
    
    $
    275,483
    
    
    
    
    
    
    
    
    
    
    $
    215,396Shareholders equity
    
    $
    29,063
    
    
    
    
    
    
    
    
    
    
    $
    24,850
    
    
    
    
    
    
    
    
    
    
    $
    21,185Total
    
    $
    350,840
    
    
    
    
    
    
    
    
    
    
    $
    300,333
    
    
    
    
    
    
    
    
    
    
    $
    236,581Net interest on earnings
    
    
    
    
    
    $
    13,049
    
    
    
    
    
    
    
    
    
    
    $
    11,455
    
    
    
    
    
    
    
    
    
    
    $
    9,472Net yield on interest earning assets
    
    
    
    
    
    
    
    
    
    
    3.84
    %
    
    
    
    
    
    
    
    
    
    
    4.03
    %
    
    
    
    
    
    
    
    
    
    
    4.28
    %
 
 *
    
    For the purpose of these computations, non-accruing loans are included in the daily average loan
amounts outstanding 14




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2005 Compared to 2004
    
    
    2004 Compared to 2003Increase (Decrease) Due to *
    
    
    Increase (Decrease) Due to *Volume
    
    
    Rate
    
    
    Net
    
    
    Volume
    
    
    Rate
    
    
    Net(thousands of dollars)Interest earned on:Loans (domestic)
    
    
    2,046
    
    
    
    1,470
    
    
    
    3,516
    
    
    
    3,324
    
    
    
    (472
    )
    
    
    2,852Taxable investment securities
    
    
    404
    
    
    
    243
    
    
    
    647
    
    
    
    346
    
    
    
    (62
    )
    
    
    284Tax-exempt investment securities
    
    
    120
    
    
    
    9
    
    
    
    129
    
    
    
    (34
    )
    
    
    (2
    )
    
    
    (36
    )Other Securities
    
    
    22
    
    
    
    6
    
    
    
    28
    
    
    
    50
    
    
    
    0
    
    
    
    50Federal funds sold &
interest bearing balances
    
    
    0115
    
    
    
    20
    
    
    
    135
    
    
    
    (18
    )
    
    
    11
    
    
    
    (7
    )Total interest earning assets
    
    
    2,707
    
    
    
    1,748
    
    
    
    4,455
    
    
    
    3,667
    
    
    
    (524
    )
    
    
    3,143Interest paid on:Demand deposits
    
    
    (30
    )
    
    
    (119
    )
    
    
    (149
    )
    
    
    46
    
    
    
    12
    
    
    
    58Savings deposits
    
    
    196
    
    
    
    1,463
    
    
    
    1,659
    
    
    
    251
    
    
    
    116
    
    
    
    367Time deposits
    
    
    650
    
    
    
    594
    
    
    
    1,244
    
    
    
    683
    
    
    
    (155
    )
    
    
    528Federal funds purchased
    
    
    63
    
    
    
    22
    
    
    
    85
    
    
    
    308
    
    
    
    (30
    )
    
    
    278Repurchase Agreements
    
    
    (27
    )
    
    
    49
    
    
    
    22
    
    
    
    (182
    )
    
    
    112
    
    
    
    (70
    )Other
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Total interest bearing liabilities
    
    
    852
    
    
    
    2,009
    
    
    
    2,861
    
    
    
    1,106
    
    
    
    55
    
    
    
    1,161
 
 *
    
    The change in interest due to both volume and rate has been allocated to volume and rate
changes in proportion to the relationship of the absolute dollar amounts of the change in each Investment Portfolio
  December 31(thousands of dollars)2005
    
    
    2004
    
    
    2003U.S. Treasury and other U.S.
Government agencies
    
    $
    58,574
    
    
    $
    47,471
    
    
    $
    37,360States and political subdivisions
    
    $
    12,755
    
    
    $
    10,292
    
    
    $
    8,568Other
    
    $
    1,723
    
    
    $
    1,734
    
    
    $
    941TOTAL
    
    $
    73,052
    
    
    $
    59,497
    
    
    $
    46,869
 15




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Maturing(thousands of dollars)After One But Within
    
    
    After Five But WithinWithin One Year
    
    
    Five Years
    
    
    Ten Years
    
    
    After Ten Years
    
    
    TotalAmount
    
    
    Yield
    
    
    Amount
    
    
    Yield
    
    
    Amount
    
    
    Yield
    
    
    Amount
    
    
    Yield
    
    
    Amount
    
    
    YieldU.S. Treasury & Government
AgenciesFixed rate
    
    $
    4,000
    
    
    
    4.38
    %
    
    $
    5,998
    
    
    
    3.70
    %
    
    $
    0
    
    
    
    
    
    
    $
    0
    
    
    
    
    
    
    $
    9,998
    
    
    
    3.97
    %Floating Rate
    
    $
    0
    
    
    
    
    
    
    $
    0
    
    
    
    
    
    
    $
    0
    
    
    
    
    
    
    $
    0
    
    
    
    
    
    
    $
    0U.S. government agencies,
MBSs and CMOsFixed rate
    
    $
    2,733
    
    
    
    3.64
    %
    
    $
    38,830
    
    
    
    4.27
    %
    
    $
    8,100
    
    
    
    4.82
    %
    
    $
    0
    
    
    
    
    
    
    $
    49,663
    
    
    
    4.33
    %Floating rate
    
    $
    0
    
    
    
    
    
    
    $
    237
    
    
    
    2.73
    %
    
    $
    0
    
    
    
    
    
    
    $
    0
    
    
    
    
    
    
    $
    237
    
    
    
    2.73
    %States and political
subdivisions
    
    
    671
    
    
    
    5.67
    %
    
    $
    6,182
    
    
    
    5.66
    %
    
    $
    5,193
    
    
    
    5.41
    %
    
    $
    708
    
    
    
    5.22
    %
    
    $
    12,754
    
    
    
    5.54
    %TOTAL
    
    $
    7,404
    
    
    
    4.23
    %
    
    $
    51,247
    
    
    
    4.37
    %
    
    $
    13,293
    
    
    
    5.05
    %
    
    $
    708
    
    
    
    5.22
    %
    
    $
    72,652
    
    
    
    4.48
    %
 16




---



##### Table of Contents



Within One
    
    
    After One But
    
    
    After FiveYear
    
    
    Within Five
    
    
    Years
    
    
    TotalLoans with:1-4 Family 1st
Mortgages
    
    $
    26,380
    
    
    $
    58,335
    
    
    $
    2,388
    
    
    $
    87,103All Other Loans
    
    $
    57,501
    
    
    $
    134,560
    
    
    $
    5,451
    
    
    $
    197,512Total
    
    $
    83,881
    
    
    $
    192,895
    
    
    $
    7,839
    
    
    $
    284,615
 Non-accrual, Past Due and Restructured Loans
  December 31,(thousands of dollars)2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001Non-accrual loans:
    
    $
    0
    
    
    $
    0
    
    
    $
    1,317
    
    
    $
    1,611
    
    
    $
    0Accruing loans past
due 90 days or more:
    
    $
    0
    
    
    $
    0
    
    
    $
    0
    
    
    $
    0
    
    
    $
    0Restructured loans:
    
    $
    0
    
    
    $
    0
    
    
    $
    0
    
    
    $
    0
    
    
    $
    0Total
    
    $
    0
    
    
    $
    0
    
    
    $
    1,317
    
    
    $
    1,611
    
    
    $
    0Interest Income not collected that would
have been collected under original terms:
    
    $
    0
    
    
    $
    0
    
    
    $
    9
    
    
    $
    14
    
    
    $
    0Commitments to lend additional funds:
    
    $
    0
    
    
    $
    0
    
    
    $
    0
    
    
    $
    0
    
    
    $
    0
  Potential Problem Loans
  Foreign Outstandings
 Certain International Developments
 Loan Concentrations 
 17




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##### Table of Contents



Summary of Loan Loss Experience
  2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001(thousands of dollars)Loan Loss ReserveBalance at January 1
    
    $
    2,362
    
    
    $
    2,067
    
    
    $
    1,704
    
    
    $
    1,551
    
    
    $
    1,373Charge-offs:Commercial and other loans
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Real estate
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    10Installment/consumer
    
    
    8
    
    
    
    23
    
    
    
    101
    
    
    
    182
    
    
    
    73Total Charge-offs
    
    $
    8
    
    
    $
    23
    
    
    $
    101
    
    
    $
    182
    
    
    $
    83Recoveries:Commercial and other loans
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    11Real estate
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Installment/consumer
    
    
    11
    
    
    
    4
    
    
    
    16
    
    
    
    14
    
    
    
    0Total Recoveries
    
    $
    11
    
    
    $
    4
    
    
    $
    16
    
    
    $
    14
    
    
    $
    11Net charge-offs (recoveries)
    
    
    (3
    )
    
    
    19
    
    
    
    85
    
    
    
    168
    
    
    
    72Additions charged to operations *
    
    
    481
    
    
    
    314
    
    
    
    448
    
    
    
    321
    
    
    
    250Loan Loss ReserveBalance at December 31
    
    $
    2,846
    
    
    $
    2,362
    
    
    $
    2,067
    
    
    $
    1,704
    
    
    $
    1,551Ratio of net charge-offs
to average loans outstanding:
    
    
    0.00
    %
    
    
    0.01
    %
    
    
    0.05
    %
    
    
    0.11
    %
    
    
    0.05
    %
  Deposits
  AveragesYear Ended December 31(thousands of dollars)2005
    
    
    2004
    
    
    2003Amount
    
    
    Rate
    
    
    Amount
    
    
    Rate
    
    
    Amount
    
    
    RateDomestic bank offices:Non-interest-bearing
demand deposits
    
    $
    39,307
    
    
    
    0.00
    %
    
    $
    30,133
    
    
    
    0
    %
    
    $
    24,760
    
    
    
    0
    %Interest-bearing demand
Deposits
    
    $
    39,783
    
    
    
    0.26
    %
    
    $
    45,120
    
    
    
    0.56
    %
    
    $
    36,960
    
    
    
    0.52
    %Savings deposits
    
    $
    103,644
    
    
    
    2.51
    %
    
    
    85,809
    
    
    
    1.10
    %
    
    
    63,031
    
    
    
    0.92
    %Time deposits
    
    $
    116,005
    
    
    
    3.24
    %
    
    
    92,213
    
    
    
    2.73
    %
    
    
    67,207
    
    
    
    2.96
    %Total
    
    $
    298,739
    
    
    
    2.16
    %
    
    $
    253,275
    
    
    
    1.47
    %
    
    $
    191,958
    
    
    
    1.44
    %
 18




---



##### Table of Contents



Return on Average Equity and Average Assets
  Year Ended December 312005
    
    2004
    
    2003Return on average assets
    
    
    0.99
    %
    
    
    1.06
    %
    
    
    0.91
    %Return on average equity
    
    
    11.9
    %
    
    
    12.8
    %
    
    
    10.2
    %Dividend pay out ratio
    
    
    0.0
    %
    
    
    0.00
    %
    
    
    0.00
    %Average equity to average assets ratio
    
    
    8.28
    %
    
    
    8.27
    %
    
    
    8.95
    %
 Short-Term Borrowings
  Overnight FundsPurchased &Securities Sold
    
    
    
    
    
    Other ShortUnder Agreements
    
    Commercial
    
    Termto Repurchase
    
    Paper
    
    Borrowings(thousands of dollars)Balance at December 31:2005
    
    
    $
    7,721
    
    
    $
    0
    
    
    $
    12,9502004
    
    
    $
    3,343
    
    
    $
    0
    
    
    $
    17,2502003
    
    
    $
    11,301
    
    
    $
    0
    
    
    $
    9,500Weighted average interest rate at year end2005
    
    
    
    3.99
    %
    
    
    0.00
    %
    
    
    3.31
    %2004
    
    
    
    2.10
    %
    
    
    0.00
    %
    
    
    3.33
    %2003
    
    
    
    0.94
    %
    
    
    0.00
    %
    
    
    3.49
    %Maximum amount outstanding at any months end2005
    
    
    $
    13,068
    
    
    $
    0
    
    
    $
    17,2502004
    
    
    $
    11,942
    
    
    $
    0
    
    
    $
    18,3502003
    
    
    $
    19,730
    
    
    $
    0
    
    
    $
    10,000Average amount outstanding during the year2005
    
    
    $
    5,775
    
    
    $
    0
    
    
    $
    15,0442004
    
    
    $
    5,174
    
    
    $
    0
    
    
    $
    15,3312003
    
    
    $
    16,235
    
    
    $
    0
    
    
    $
    5,734Weighted average interest rate during the year2005
    
    
    
    3.39
    %
    
    
    0.00
    %
    
    
    3.34
    %2004
    
    
    
    1.68
    %
    
    
    0.00
    %
    
    
    3.29
    %2003
    
    
    
    0.97
    %
    
    
    0.00
    %
    
    
    3.87
    %
 
 *
    
    Federal funds purchased and securities sold under agreements to repurchase generally mature within
one to four days of the transaction date. 19




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##### Table of Contents



ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
  FORWARD LOOKING STATEMENTS
      20




---



##### Table of Contents



Financial Condition
  Sources and Uses of Funds Trends
    
    (thousands of dollars)2005
    
    
    2004
    
    
    2003Average Balance
    
    Amount Change
    
    
    % Change
    
    
    Average Balance
    
    
    Amount Change
    
    
    % Change
    
    
    Average BalanceFunding uses:Loans
    
    $
    256,818
    
    
    $
    33,185
    
    
    
    14.84
    %
    
    $
    223,633
    
    
    $
    53,956
    
    
    
    31.80
    %
    
    $
    169,677Taxable investment
Securities
    
    
    55,793
    
    
    $
    13,286
    
    
    
    31.26
    %
    
    
    42,507
    
    
    
    9,857
    
    
    
    30.19
    %
    
    
    32,650Tax-exempt investment
Securities
    
    
    12,438
    
    
    $
    3,232
    
    
    
    35.11
    %
    
    
    9,206
    
    
    
    (916
    )
    
    
    (9.05
    %)
    
    
    10,122Federal funds sold & Interest
bearing bank
balances
    
    
    15,086
    
    
    $
    7,738
    
    
    
    105.31
    %
    
    
    7,348
    
    
    
    (1,518
    )
    
    
    (17.12
    %)
    
    
    8,866Total uses
    
    $
    340,135
    
    
    $
    57,441
    
    
    
    20.32
    %
    
    $
    282,694
    
    
    $
    61,379
    
    
    
    27.73
    %
    
    $
    221,315Funding sources:Demand deposits:Non-interest-bearing
    
    $
    39,307
    
    
    $
    9,174
    
    
    
    30.45
    %
    
    $
    30,133
    
    
    $
    5,373
    
    
    
    21.70
    %
    
    $
    24,760Interest-bearing
    
    
    39,783
    
    
    ($
    5,337
    )
    
    
    -11.83
    %
    
    
    45,120
    
    
    
    8,160
    
    
    
    22.08
    %
    
    
    36,960Savings Deposits
    
    
    103,644
    
    
    $
    17,835
    
    
    
    20.78
    %
    
    
    85,809
    
    
    
    22,778
    
    
    
    36.14
    %
    
    
    63,031Time deposits
    
    
    116,005
    
    
    $
    23,792
    
    
    
    25.80
    %
    
    
    92,213
    
    
    
    25,006
    
    
    
    37.21
    %
    
    
    67,207Federal funds purchased
and other borrowings
    
    
    17,255
    
    
    $
    1,924
    
    
    
    12.55
    %
    
    
    15,331
    
    
    
    9,347
    
    
    
    156.20
    %
    
    
    5,984Repurchase agreements
    
    
    3,565
    
    
    ($
    1,609
    )
    
    
    -31.10
    %
    
    
    5,174
    
    
    
    (10,811
    )
    
    
    (67.63
    %)
    
    
    15,985Other
    
    
    20,576
    
    
    $
    11,662
    
    
    
    130.83
    %
    
    
    8,914
    
    
    
    1,526
    
    
    
    20.66
    %
    
    
    7,388Total sources
    
    $
    340,135
    
    
    $
    57,441
    
    
    
    20.32
    %
    
    $
    282,694
    
    
    $
    61,379
    
    
    
    27.73
    %
    
    $
    221,315
    21




---



##### Table of Contents



Liquidity and Interest Rate Sensitivity Management
     Time Deposits(thousands of dollars)3 months or less
    
    $
    12,017Over 3 through 6 months
    
    
    13,541Over 6 through 12 months
    
    
    21,677Over 12 through 36 months
    
    
    3,511Over 36 months
    
    
    1,160Total
    
    $
    51,906
   As of December 31(thousands of dollars)0-90
    
    
    91-365
    
    
    1-3
    
    
    Over 3Days
    
    
    Days
    
    
    Years
    
    
    YearsInterest-sensitive assets
    
    $
    106,000
    
    
    $
    110,297
    
    
    $
    98,405
    
    
    $
    41,897Interest-sensitive liabilities
    
    $
    87,875
    
    
    $
    95,237
    
    
    $
    122,262
    
    
    $
    3,460Interest sensitivity gap
    
    $
    18,125
    
    
    $
    15,060
    
    
    ($
    23,857
    )
    
    $
    38,437Cumulative gap
    
    $
    18,125
    
    
    $
    33,185
    
    
    $
    9,328
    
    
    $
    47,765
  22




---



##### Table of Contents



Capital Resources
     2005
    
    2004(thousands of dollars)Tier 1 Capital
    
    
    29,113
    
    
    $
    25,473Tier 2 Capital
    
    
    2,846
    
    
    $
    2,362Total Qualifying Capital
    
    
    31,959
    
    
    $
    27,835Risk Adjusted Total Assets
(including off-balance exposures)
    
    $
    278,815
    
    
    $
    238,898Average Total Assets for Leverage Purposes
    
    
    365,507
    
    
    $
    312,868Tier 1 Risk-Based Capital Ratio
    
    
    10.44
    %
    
    
    10.66
    %Total Risk-Based Capital Ratio
    
    
    11.46
    %
    
    
    11.65
    %Leverage Ratio
    
    
    7.97
    %
    
    
    8.14
    %
  Relationship Between Significant Financial Ratios
  2005
    
    2004
    
    2003Return on average equity
    
    
    11.9
    %
    
    
    12.8
    %
    
    
    10.2
    %Earnings retained
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %Internal capital growth
    
    
    13.9
    %
    
    
    14.45
    %
    
    
    11.10
    %
   23




---



##### Table of Contents



Results of Operations
      24




---



##### Table of Contents



LOANS
   December 31,2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001(thousand of dollars)Domestic Loans:Commercial and Other
    
    
    11,895
    
    
    $
    13,933
    
    
    $
    9,684
    
    
    $
    10,500
    
    
    $
    11,748Real estate-construction
    
    
    15,476
    
    
    
    10,709
    
    
    
    10,815
    
    
    
    2,509
    
    
    
    5,053Real estate  Residential
    
    
    92,967
    
    
    
    74,241
    
    
    
    82,202
    
    
    
    59,303
    
    
    
    52,137Real estate  Other
    
    
    162,247
    
    
    
    134,644
    
    
    
    99,489
    
    
    
    80,454
    
    
    
    71,025Installment/Consumer
    
    
    2,030
    
    
    
    2,652
    
    
    
    3,236
    
    
    
    4,153
    
    
    
    5,981Non-accrual
    
    
    0
    
    
    
    0
    
    
    
    1,317
    
    
    
    1,611
    
    
    
    0Total domestic loans
    
    
    284,615
    
    
    $
    236,179
    
    
    $
    206,743
    
    
    $
    158,530
    
    
    $
    145,944
  Allowance for Loan Losses
   25




---



##### Table of Contents



Composition of Allowance for Loan Losses
   2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001%
    
    
    
    
    
    
    %
    
    
    
    
    
    
    %
    
    
    
    
    
    
    %
    
    
    
    
    
    
    %(thousands of dollars)
    
    Balance
    
    
    Loans
    
    
    Balance
    
    
    Loans
    
    
    Balance
    
    
    Loans
    
    
    Balance
    
    
    Loans
    
    
    Balance
    
    
    LoansCommercial, Commercial
RE, Construction &
Agricultural
    
    $
    1,483
    
    
    
    66
    %
    
    $
    1,033
    
    
    
    68
    %
    
    $
    753
    
    
    
    63
    %
    
    $
    241
    
    
    
    63
    %
    
    $
    388
    
    
    
    60
    %Real estate-residential
    
    $
    759
    
    
    
    32
    %
    
    $
    430
    
    
    
    31
    %
    
    $
    548
    
    
    
    32
    %
    
    $
    106
    
    
    
    32
    %
    
    
    95
    
    
    
    36
    %Consumer
    
    $
    5
    
    
    
    1
    %
    
    $
    5
    
    
    
    1
    %
    
    $
    54
    
    
    
    4
    %
    
    $
    12
    
    
    
    4
    %
    
    
    150
    
    
    
    4
    %Special allocations
    
    $
    22
    
    
    
    1
    %
    
    $
    10
    
    
    
    0
    %
    
    $
    7
    
    
    
    1
    %
    
    $
    136
    
    
    
    1
    %
    
    
    10
    
    
    
    0
    %Unallocated
    
    $
    577
    
    
    
    0
    %
    
    $
    884
    
    
    
    0
    %
    
    $
    705
    
    
    
    0
    %
    
    $
    1,209
    
    
    
    0
    %
    
    
    908
    
    
    
    0
    %Total
    
    $
    2,846
    
    
    
    100
    %
    
    $
    2,362
    
    
    
    100
    %
    
    $
    2,067
    
    
    
    100
    %
    
    $
    1,704
    
    
    
    100
    %
    
    $
    1,551
    
    
    
    100
    %
   Non-performing Assets
   26




---



##### Table of Contents



Distribution of Non-performing Assets
 December 312005
    
    2004(thousands of Dollars)Commercial, Commercial RE,
& Construction
    
    $
    0
    
    
    $
    0Residential RE
    
    
    0
    
    
    
    0Installment/Consumer
    
    
    0
    
    
    
    0Total non-performing loans
    
    $
    0
    
    
    $
    0Other real estate owned
    
    $
    0
    
    
    $
    0Other Assets
    
    $
    0
    
    
    $
    0Debt Security
    
    $
    0
    
    
    $
    0Total non-performing assets
    
    $
    0
    
    
    $
    0Non-performing loans to
year-end loans
    
    
    0.00
    %
    
    
    0.00
    %Non-performing assets to year-end
loans and other real estate owned
    
    
    0.00
    %
    
    
    0.00
    %
      Income Taxes
  Impact of Inflation and Changing Prices
   27




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##### Table of Contents



Off Balance Sheet Arrangements
  Contractual Obligations Table
 Payment due by period(thousands of dollars)Less than 1
    
    
    
    
    
    
    
    
    
    
    More thanContractual Obligations
    
    Total
    
    
    year
    
    
    1-3 years
    
    
    3-5 years
    
    
    5 yearsLong-Term Debt Obligations
    
    
    12,950
    
    
    
    4,300
    
    
    
    7,100
    
    
    
    1,550
    
    
    
    0Capital Lease Obligations
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Operating Lease Obligations
    
    
    1,003
    
    
    
    285
    
    
    
    392
    
    
    
    135
    
    
    
    191Purchase Obligations
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Other Long-Term Liabilities

    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Reflected on the RegistrantsBalance Sheet under GAAPTotal
    
    $
    13,953
    
    
    $
    4,585
    
    
    $
    7,492
    
    
    $
    1,685
    
    
    $
    191
 
 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
  (i)
    
    Managements Discussion and Analysis of Financial Condition and Results of
Operations"Liquidity and Interest Rate Sensitivity Management.(ii)
    
    PART II  Item 6.  Selected Financial Data  Investment Portfolio(iii)
    
    PART II  Item 6.  Selected Financial Data  Loan Portfolio(iv)
    
    PART II  Item 8.  Financial Statements and Supplementary Data.
 28




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##### Table of Contents



FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
   Years Ended December 31,(thousands, except share amounts)2005
    
    
    2004Fourth Quarter
    
    
    Third Quarter
    
    
    Second Quarter
    
    
    First Quarter
    
    
    Fourth Quarter
    
    
    Third Quarter
    
    
    Second Quarter
    
    
    First Quarter(in thousands, except per share data)Interest and dividend income
    
    $
    5,466
    
    
    $
    5,232
    
    
    $
    4,886
    
    
    $
    4,631
    
    
    $
    4,281
    
    
    $
    4,050
    
    
    $
    3,751
    
    
    $
    3,678Interest expense
    
    
    (2,330
    )
    
    
    (1,889
    )
    
    
    (1,591
    )
    
    
    (1,356
    )
    
    
    (1,235
    )
    
    
    (1,074
    )
    
    
    (1,018
    )
    
    
    (978
    )Provision for loan losses
    
    
    (129
    )
    
    
    (158
    )
    
    
    (153
    )
    
    
    (41
    )
    
    
    (12
    )
    
    
    (102
    )
    
    
    (70
    )
    
    
    (130
    )Net interest income, after
provision for loan losses
    
    
    3,007
    
    
    
    3,185
    
    
    
    3,142
    
    
    
    3,234
    
    
    
    3,034
    
    
    
    2,874
    
    
    
    2,663
    
    
    
    2,570Non-interest income (charges)
    
    
    639
    
    
    
    666
    
    
    
    737
    
    
    
    611
    
    
    
    (593
    )
    
    
    583
    
    
    
    598
    
    
    
    542Non-interest expenses
    
    
    (2,549
    )
    
    
    (2,566
    )
    
    
    (2,408
    )
    
    
    (2,339
    )
    
    
    (2,089
    )
    
    
    (2,152
    )
    
    
    (2,185
    )
    
    
    ( 2,086
    )Income before income taxes
    
    
    1,097
    
    
    
    1,285
    
    
    
    1,471
    
    
    
    1,506
    
    
    
    1,538
    
    
    
    1,305
    
    
    
    1,076
    
    
    
    1,026Provision for income taxes
    
    
    (399
    )
    
    
    (452
    )
    
    
    (515
    )
    
    
    (536
    )
    
    
    (553
    )
    
    
    (467
    )
    
    
    (383
    )
    
    
    (361
    )Net income
    
    $
    698
    
    
    $
    833
    
    
    $
    956
    
    
    $
    970
    
    
    $
    985
    
    
    $
    838
    
    
    $
    693
    
    
    $
    665Earnings per common share:Basic
    
    $
    0.21
    
    
    $
    0.24
    
    
    $
    0.29
    
    
    $
    0.29
    
    
    $
    0.30
    
    
    $
    0.26
    
    
    $
    0.21
    
    
    $
    0.20Diluted
    
    $
    0.19
    
    
    $
    0.24
    
    
    $
    0.27
    
    
    $
    0.28
    
    
    $
    0.28
    
    
    $
    0.24
    
    
    $
    0.20
    
    
    $
    0.19Market Price Range1High
    
    $
    33.98
    
    
    $
    33.75
    
    
    $
    33.75
    
    
    $
    26.00
    
    
    $
    26.40
    
    
    $
    28.20
    
    
    $
    22.54
    
    
    $
    23.49Low
    
    $
    31.14
    
    
    $
    24.00
    
    
    $
    22.91
    
    
    $
    22.00
    
    
    $
    24.00
    
    
    $
    19.40
    
    
    $
    16.51
    
    
    $
    14.33
 
 1.
    
    All per share information is presented to reflect the 5 % stock dividends declared for 2004
and the three for two stock split declared in 2004. 
 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
  
 CONTROLS AND PROCEDURES
   29




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##### Table of Contents



PART III
 
 DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
 Year
    
    Company
    
    Percent ofElected
    
    Stock
    
    Classto
    
    Beneficially
    
    BeneficiallyName, Age And Business Experience
    
    Board*
    
    Owned**
    
    OwnedBeverly Beall, 60,
is the Foundation
Administrator of
Bealls, Inc., a
multi-state chain
of outlet and
department stores
headquartered in
Bradenton. She has
been with Bealls
since 1985.
    
    
    1992
    
    
    18,896
    1

    
    
    .55
    %Robert G. Blalock,
67, is Chairman of
the law firm of
Blalock, Walters,
Held & Johnson,
P.A., since 1964.
    
    
    1986
    
    
    78,714
2

    
    
    2.31
    %Allen J. Butler,
59, is President of
H. Butler Footwear,
Inc., a retail
sales consulting
and investment
management company
headquartered in
Bradenton. He has
been with the
company since 1971.
    
    
    1986
    
    
    105,784
    3
    
    
    3.11
    %Rosemary R.
Carlson,58, is V.
P. and General
Manager of Bright
House Networks and
has been with
Bright House
Networks and its
predecessors since
1974.
    
    
    1998
    
    
    11,217

    4
    
    
    .33
    %Francis I. duPont,
III, 61, has been
Chairman of the
Board and Chief
Executive Officer
of 1st
National Bank &
Trust since July
1994 and First
National Bancshares
since 1998.
    
    
    1994
    
    
    180,153
    5
    
    
    5.29
    %Glen W. Fausset,
56, has been
President and Chief
Operating Officer
of the
1st
National Bank &
Trust since July
1986 and President
of the First
National Bancshares
since 1998.
    
    
    1986
    
    
    
    90,983
    
    
    
    2.67
    %Thomas P. Moseley,
Jr.45 has been
Executive Vice
President since
2002. Previously
he was Vice
President and
Credit
Administration
Manager for First
Charter Bank,
Charlotte North
Carolina from
2001-2002; CFO and
Controller for S.J.
Glauser, Inc.,
Sarasota Florida;
Group Vice
President/ Manatee
County President
for SouthTrust
Bank, N.A., Bradenton Florida from 1998-2000.
    
    N/A Exec. Officer
    
    15,787
    6
    
    
    .46
    %Sarah H. Pappas,
Ed.D, 65, is the
President of
Manatee Community
College, a state
institution
headquartered in
Bradenton. She has
been with the
College since 1997.
    
    
    2005
    
    
    3,650
    7
    
    
    .11
    %Raymond A. Weigel, III, 61, is President of
CLB Consulting, Inc., of Grand Rapids,
Michigan. He has been with the firm since
its inception in 1992. From 1988 to 1992, he
was a securities broker with Robert W. Baird
& Co., Inc.
    
    
    1994
    
    
    52,554
    8
    
    
    1.54
    %Irving I. Zamikoff, DDS,63, is a dentist and
has been practicing in Bradenton for more
than 30 years.
    
    
    2005
    
    
    4,778
    9
    
    
    
    .14
    %Dan C. Zoller,66, is President of Zoller,
Najjar & Shroyer, L.C., a civil engineering
firm located in Bradenton. He has been
associated with the firm since its inception
in 1975.
    
    
    1998
    
    
    122,192
    10
    
    
    
    3.59
    %TOTALfor all Directors and Executive Officers
    
    
    
    
    
    
    684,708
    
    
    
    20.12
    %
 
 1
    
    Mrs. Bealls shares include 1,866 shares held in a
deferred compensation plan.2
    
    Mr. Blalocks shares includes 37,318 shares held in
trust of which Mr. Blalock is either sole trustee or co-trustee. His wife owns
10,757 shares solely in her name which are included but in which Mr. Blalock
disclaims any interest.3
    
    Mr. Butler owns 103,536 shares as joint tenant with his
wife, 1,927 shares are held in a deferred compensation plan, 164 shares are
held in H. Butler Footwear, Inc. and 157 shares are held in childrens names.4
    
    Mrs. Carlson owns 544 shares as joint tenant with her
husband and 1,920 shares aer held in a deferred compensation plan. Her husband
owns 2,357 shares in his name which are included, but in which Mrs. Carlson
disclaims any interest.5
    
    Mr. duPonts wife owns 30,627 shares solely in her name,
which are included but in which Mr. duPont disclaims any interest.6
    
    Mr. Moseleys shares include 10,000 unvested shares in
the stock option plan.7
    
    Dr. Pappas shares include 1,823 shares held in a
deferred compensation plan.*
    
    Indicates year elected to the Board of the Bank. The Company Board is identical in
composition to the Board of the Bank.**
    
    Unless otherwise indicated, the beneficial owner has sole voting and investment power. 30




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##### Table of Contents



st
 Audit Committee
   Section 16(a) Beneficial Ownership Reporting Compliance
  
 8
    
    Mr. Weigel owns 7,734 shares as joint tenant with his
wife. This wife owns 10,294 shares, which are included but in which Mr. Weigel
disclaims any interest.9
    
    Dr. Zamikoff shares included 1,841 shares held in a
deferred compensation plan.10
    
    Mr. Zoller owns 73,179 as joint tenant with his wife,
5,160 shares held in trust of which Mr. Zoller is co-trustee and 1,949 shares
are held in a deferred compensation plan. Mrs. Zoller owns 17,705 shares
solely in her name which are included, but in which Mr. Zoller disclaims any
interest. 31




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##### Table of Contents



Code of Ethics Disclosure
  
 EXECUTIVE COMPENSATION
   
 Summary Compensation Table
 All Other
    
    Number of SharesCompensation
    
    Awarded under StockSalary
    
    Bonus
    
    1
    
    OptionName and Principal Position
    
    Year
    
    ($)
    
    ($)
    
    ($)
    
    Plan22005
    
    
    
    193,000
    
    
    
    96,000
    
    
    
    13,910
    
    
    
    -0-Francis I. duPont, III,
    
    
    2004
    
    
    
    182,000
    
    
    
    70,000
    
    
    
    11,581
    
    
    
    -0-Chairman of the Board &CEO
    
    
    2003
    
    
    
    173,200
    
    
    
    51,600
    
    
    
    9,855
    
    
    
    3,0002005
    
    
    
    150,000
    
    
    
    72,000
    
    
    
    13,680
    
    
    
    -0-Glen W. Fausset,
    
    
    2004
    
    
    
    135,000
    
    
    
    47,500
    
    
    
    11,237
    
    
    
    -0-President & COO
    
    
    2003
    
    
    
    125,000
    
    
    
    34,400
    
    
    
    7,174
    
    
    
    2,2502005
    
    
    
    127,500
    
    
    
    56,000
    
    
    
    9,854
    
    
    
    -0-Thomas P. Moseley
    
    
    2004
    
    
    
    115,000
    
    
    
    35,000
    
    
    
    3,641
    
    
    
    10,000Executive Vice President
    
    
    2003
    
    
    
    105,000
    
    
    
    78,747
    
    
    
    2,519
    
    
    
    -0-
 
 1
    
    Includes value of life insurance premiums paid, and 401-k matching contributions by the
Bank of $12,600 for Messrs. duPont and Fausset and $8,936 for Mr. Moseley.2
    
    See Tables IV and V for details of awards. Change of Control Provisions
  Incentive Stock Option Plan
  32




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##### Table of Contents



Aggregated Option/SAR Exercises in Fiscal 2005 and Fiscal Year End Option/SAR Values 1
 Value of UnexercisedNumber of
    
    in-the-moneyUnexercised
    
    Options atShares Acquired On
    
    Value
    
    Options at 12/31/20052
    
    12/31/20053Name
    
    Exercise (#)
    
    Realized
    
    Exercisable/Un-exercisable
    
    Exercisable/Un-exercisableFrancis I duPont, III
    
    54,253
    
    $915,278
    
    -0- / -0-
    
    $-0- / $-0-Glen W. Fausset
    
    40,689
    
    $625,406
    
    -0- / -0-
    
    $-0- / $-0-Thomas P. Moseley
    
    5,788
    
    $  85,480
    
    -0- / 10,000
    
    $-0- / $73,600
 
 (1)
    
    The bank does not have a stock appreciation rights (SAR) plan.(2)
    
    Includes additional shares accrued due to stock dividends and splits.(3)
    
    Based on market value of $32.95 per share, representing the last known trade before year-end. 33




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##### Table of Contents



Option/SAR Grants in fiscal 2005 1
 Individual GrantsNumber of
    
    
    
    
    
    
    
    Potential RealizableShares
    
    
    
    
    
    
    
    Value at AssumedUnderlying
    
    
    
    
    
    
    
    Annual Rates of StockOptions
    
    Percent of Total
    
    Exercise of
    
    
    
    Price Appreciation forGranted in
    
    Options/SARs Granted
    
    Base Price
    
    Expiration
    
    Option TermName
    
    2005
    
    to Employees in 2005
    
    ($/share)
    
    Date
    
    5% ($)
    
    10% ($)Francis I duPont,
III
    
    -0-
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/AGlen W. Fausset
    
    -0-
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/AThomas P. Moseley
    
    -0-
    
    N/A
    
    N/A
    
    N/A
    
    N/A
    
    N/A
 The Bank does not have a stock appreciation rights (SAR) plan.
 Pension Plan
    Pension Plan Table
 Years of ServiceRemuneration
    
    10 Years
    
    20 Years
    
    30 Years
    
    40 Years$20,000
    
    $
    4,000
    
    
    $
    8,000
    
    
    $
    11,200
    
    
    $
    11,20040,000
    
    
    8,000
    
    
    
    16,000
    
    
    
    22,400
    
    
    
    22,40060,000
    
    
    12,000
    
    
    
    24,000
    
    
    
    33,600
    
    
    
    33,60080,000
    
    
    16,000
    
    
    
    32,000
    
    
    
    44,800
    
    
    
    44,800100,000
    
    
    20,000
    
    
    
    40,000
    
    
    
    56,000
    
    
    
    56,000120,000
    
    
    24,000
    
    
    
    48,000
    
    
    
    67,200
    
    
    
    67,200150,000
    
    
    30,000
    
    
    
    60,000
    
    
    
    84,000
    
    
    
    84,000200,000
    
    
    40,000
    
    
    
    80,000
    
    
    
    112,000
    
    
    
    112,000300,000*
    
    
    44,000
    
    
    
    88,000
    
    
    
    123,200
    
    
    
    123,200
 
 *
    
    The current 2005 compensation limit that can be used for qualified
defined benefit plans is $210,000. For 2006 a$220,000 benefit limit is
incorporated in the information provided in the chart numbers shown
above. 34




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##### Table of Contents



Estimated Credited Years of Service
    
    
    
    
    
    Projected Benefit Service atfor Named Executive Officers
    
    Current Benefit Service
    
    
    normal retirement ageFrancis I duPont, III
    
    11 Years
    
    16 YearsGlen W. Fausset
    
    20 Years
    
    28 YearsThomas P. Moseley
    
    3 Years
    
    23 Years
 Director Compensation
  Compensation Committee Report
      35




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##### Table of Contents



Change of Control Agreements
  Stock Performance
   
 Annual Value of $100 Invested at December 31, 20002000
    
    2001
    
    2002
    
    2003
    
    2004
    
    2005First National Bancshares
    
    $100.00
    
    $  98.98
    
    $146.78
    
    $179.89
    
    $316.03
    
    $400.51Nasdaq Bank Index
    
    $100.00
    
    $110.39
    
    $115.35
    
    $149.89
    
    $166.38
    
    $159.15S & P 500 Index
    
    $100.00
    
    $  86.96
    
    $  66.63
    
    $  84.22
    
    $  91.80
    
    $  94.53
 36




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##### Table of Contents



Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
  Name
    
    Amount
    
    Percent of ClassAnd
    
    Beneficially
    
    BeneficiallyPosition
    
    Owned
    
    OwnedFrancis I.
duPont, III

(Chairman of the Board and CEO of the Company)
    
    
    180,153
    
    
    
    5.29
    %7826 Seville
Circle

Bradenton, Florida 34209Wavelet Weigel1
(no relationship with the Company)
    
    
    199,122
    
    
    
    5.85
    %9919 Spoonbill Road

Bradenton, Florida 34209
 
 1
    
    Mrs. Weigel is the mother of Raymond A. Weigel, III who serves on the Board of
Directors.  
 Certain Relationships and Related Transactions
    37




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##### Table of Contents



. Principal Accountant Fees and Services
   Year ended
    
    Year endedDecember 31, 2005
    
    December 31, 2004Audit Fees
    
    
    $  68,200
    
    
    
    $52,000Audit-Related Fees
    
    
    21,100
    
    
    
    13,000Tax Fees
    
    
    13,480
    
    
    
    7,385All Other Fees
    
    
    9,120
    
    
    
    9,515Total Fees
    
    
    $111,900
    
    
    
    $81,900
    38




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##### Table of Contents



EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
  Financial Statements and Schedules
 (i)
    
    Report of Independent Auditors Report
    
    F-1(ii)
    
    Balance Sheets
    
    F-2(iii)
    
    Statements of Income
    
    F-3(iv)
    
    Statements of Stockholders Equity
    
    F-4(v)
    
    Statements of Cash Flows
    
    F-5(vi)
    
    Notes to Financial Statements
    
    F-6
   Reports on form 8-K
   39




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##### Table of Contents



SIGNATURES
  FIRST NATIONAL BANCSHARES, INC.March 16, 2006
    
    
    
    By:
    
    /s/ Glen W. Fausset(Date)
    
    
    
    Glen W. Fausset, President
  Signature
    
    Title
    
    Date/s/ Francis I. duPont,
III
    
    Chairman of the Board and Chief Executive OfficerFrancis I. duPont, III
    
    
    
    March 16, 2006/s/ Glen W. Fausset
    
    President, Chief Financial Officer and DirectorMarch 16, 2006Glen W. Fausset/s/ Robert C. MatejcekSecretary  Treasurer
    
    March 16, 2006Robert C. Matejcek/s/ Beverly Beall

     Beverly Beall
    
    Director
    
    March 16, 2006/s/ Robert G. Blalock

     Robert G. Blalock
    
    Director
    
    March 16, 2006/s/ Allen J. Butler

     Allen J. Butler
    
    Director
    
    March 16, 2006Rosemary R. Carlson
    
    Director/s/ Sara Pappas

     Sara Pappas, Ph. D.
    
    Director
    
    March 16, 2006/s/ Raymond A. Weigel, III

     Raymond A. Weigel, III
    
    Director
    
    March 16, 2006/s/ Irv Zamikoff, D.D.S.

     Irv Zamikoff, D.D.S.
    
    Director
    
    March 16, 2006/s/ Dan C. Zoller

     Dan C. Zoller
    
    Director
    
    March 16, 2006
 40




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##### Table of Contents



EXHIBIT INDEX
 Exhibit Number
    
    Description of Document2
    
    Agreement and Plan of Merger, dated June 27, 2005, by and
between Whitney and the Company, incorporated by reference to Exhibit 2 to the
Companys Current Report on Form 8-K filed on July 28, 20053.11
    
    Amended and Restated Articles of Incorporation of First National
Bancshares, Inc.3. 22
    
    Bylaws of First National Bancshares, Inc.103
    
    Companys Incentive Stock Option Plan10.14
    
    Employment Agreement of F. I. duPont, III10.25
    
    Employment Agreement of Glen W. Fausset116
    
    Statement regarding computation of per share earnings.21
    
    Company Subsidiaries  1st National Bank & Trust31.1
    
    302 Certifications31.232.1
    
    906 Certifications Pursuant to 18 U.S.C. § 135032.299
    
    Audited Financial Statements
 
 1.
    
    Incorporated by reference to the exhibits included in the Companys S-4
Registration Statement, as filed with the Securities and Exchange Commission on July
31, 1998 (Registration No. 333-60283).2.
    
    Incorporated by reference to the exhibits included in the Companys Form
10-k, as filed with the Securities and Exchange Commission on March 22, 2004
(Registration No. 333-60283).3.
    
    Incorporated by reference to the summary of principal terms included in the
Companys Proxy Statement for the 2000 Meeting of Shareholders, as filed with the
Securities and Exchange Commission on March 10, 2000.4.
    
    Incorporated by reference to the exhibits included in the Companys Form
10-k-a, as filed with the Securities and Exchange Commission on March 30, 2005
(Registration No. 333-60283).5.
    
    Incorporated by reference to the exhibits included in the Companys Form
10-k-a, as filed with the Securities and Exchange Commission on March 30, 2005
(Registration No. 333-60283).6.
    
    Incorporated by reference to the Income Statement on page F-3 of the
Consolidated Financial Statements of First National Bancshares, Inc., as contained in
this Annual Report on Form 10-K.
 41