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U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-KSB



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|x | ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ------------------------------------------------------------------------------

For the fiscal year ended December 31, 2005



| ̈ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------

For the transition period from  to

Commission File Number: 000-32489



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TRI - STATE 1ST BANC, INC.

(Name of small business issuer in its charter)



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|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Ohio                                                           |  | 34-1824708                          
|(State or other jurisdiction of incorporation or organization) |  | (IRS Employer Identification Number)
|                                                               | 
|16924 St. Clair Avenue East Liverpool, Ohio                    |  | 43920                               
|(Address of principal executive offices)                       |  | (Zip Code)                          

Issuers telephone number, including area code:

(330) 385-9200



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Securities registered persuant to Section 12(b) of the Act:

None

Securities registered persuant to Section 12(g) of the Act:

Common Stock, no par value

(title
of class)



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Check whether the
issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 ̈

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S - B contained in this
form, and no disclosure will be contained, to the best of the registrant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 ̈.

Indicate by check mark whether
the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.):    Yes ̈No  þ

Issuers revenues for its most recent fiscal year: $7.0 million.

The aggregate market value of the voting stock held by non - affiliates computed by reference to the averaged bid and ask price on March 1, 2006, was
$11,191,374 (613,226 shares at $18.25 per share).

As of March 1, 2006, there were 859,734 shares outstanding of the registrants Common Stock.

DOCUMENTS INCORPORATED BY REFERENCE

1.
Portions of the Issuers Annual Report to Shareholders for the year ended December 31, 2005 (Parts I and II).

2. Portions of the Issuers
definitive Proxy Statement for the 2006 Annual meeting of Shareholders (Part III).

Transitional Small Business disclusure format (check
one)    Yes ̈No  x



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Tri-State 1st Banc, Inc.

Form 10-KSB

Table of Contents



|           |  |                                                                                                 |  |           
|---------- |  | ----------------------------------------------------------------------------------------------- |  | ----------
|           |  |                                                                                                 |  | PageNumber
|Part I     |  |                                                                                                 |  |           
|           |  |                                                                                                
|Item 1.    |  | Description of Business                                                                         |  | 3-10      
|           |  |                                                                                                
|Item 2.    |  | Description of Properties                                                                       |  | 10        
|           |  |                                                                                                
|Item 3.    |  | Legal Proceedings                                                                               |  | 10        
|           |  |                                                                                                
|Item 4.    |  | Submission of Matters to a Vote of Security Holders                                             |  |           
|           |  |                                                                                                
|Part II    |  |                                                                                                 |  |           
|           |  |                                                                                                
|Item 5.    |  | Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |  | 11        
|           |  |                                                                                                
|Item 6.    |  | Managements Discussion and Analysis or Plan of Operations                                      |  | 11        
|           |  |                                                                                                
|Item 7.    |  | Financial Statements                                                                            |  | 11        
|           |  |                                                                                                
|Item 8.    |  | Changes in and disagreements with Accountants on Accounting and Financial Disclosure            |  | 11        
|           |  |                                                                                                
|Item 8.A.  |  | Controls and Procedures                                                                         |  | 11-12     
|           |  |                                                                                                
|Part III   |  |                                                                                                 |  |           
|           |  |                                                                                                
|Item 9.    |  | Directors and Executive Officers of the Issuer                                                  |  | 12        
|           |  |                                                                                                
|Item 10.   |  | Executive Compensation                                                                          |  | 12        
|           |  |                                                                                                
|Item 11.   |  | Security Ownership of Certain Beneficial Owners and Management                                  |  | 12        
|           |  |                                                                                                
|Item 12.   |  | Certain Relationships and Related Transactions                                                  |  | 12        
|           |  |                                                                                                
|Item 13.   |  | Exhibits                                                                                        |  | 12-13     
|           |  |                                                                                                
|Item 14.   |  | Principal Accountant Fees and Services                                                          |  | 13        
|           | 
|Signatures |  | 14                                                                                             



Page 2



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PART I

Item 1. Description of Business

General

Certain information required by this section is presented on pages 16 and 39 of the 2005 Annual Report and is incorporated herein by reference.

As of December 31, 2005, the Company had 63 full-time employees and 17 part-time employees. The Company considers its relationship with its employees to be good.
None of the employees are covered by a collective bargaining agreement.

Supervision and Regulation

The Company is subject to regulation under the Bank Holding Company Act of 1956 as amended, and as such is subject to regulation by the Federal Reserve Board
(FRB). Bank Holding Companys are required to file with the FRB certain reports and other information regarding their business operations and those of its subsidiaries. A Bank Holding Company and its subsidiaries are also subject to
examination by the FRB.

The Financial Services Modernization Act which became law in 1999 substantially changed the Bank Holding Company Act of 1956. The
act permits subsidiaries of Bank Holding Companies to engage in a broad range of financial activities that were not previously permitted. The law authorizes a Bank Holding Company to affiliate with any financial company (for example, insurance or
securities companies) and to cross-sell an affiliates products, thus allowing such a company to offer its customers any financial product or service. In addition, the law greatly expands the number of permissible holding company activities to
include numerous financial activities that were not previously permitted. The law also permits operating subsidiaries of national banks to sell any financial product without geographic limitation.

Deposits maintained with the Bank are insured up to regulatory limits by the FDIC, and accordingly, are subject to deposit insurance assessments to maintain the Bank
Insurance Fund (BIF) administered by the FDIC. The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) was enacted on August 9, 1989. FIRREA significantly affected the financial industry in
several ways, including higher deposit insurance premiums, more stringent capital requirements and new investment limitations and restrictions. The Federal Deposit Insurance Corporation Act of 1991 (The FDIC Improvement Act) covers a
wide expanse of Banking regulatory issues including the capitalization of the BIF, deposit insurance reform, requiring the FDIC to establish a risk - based premium assessment system and a number of other regulatory and supervisory matters.

The monetary policies of regulatory authorities, including the Federal Reserve Board, have a significant effect on the operating results of banks and bank
holding companies. The nature of future monetary policies and the effect of such policies on the future business and earnings of the Company cannot be predicted.

Management is not aware of any current recommendations by regulatory authorities which, if they were to be implemented, would have a material effect on liquidity, capital resources or operations of the Company.

Competition and Market area

Business is conducted through seven banking offices located in the Upper Ohio Valley Area which constitutes the tri-state region of Columbiana County, Ohio, Hancock County, West Virginia and Beaver County, Pennsylvania. The Upper Ohio
Valley has long been an important industrial community of the United States. The Company is not dependent upon any single industry or business for its banking opportunities.



Page 3



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Competition and Market area (continued)

The Company functions in a highly competitive environment. In addition to other commercial banks, savings and loans, and savings banks, the Company must also contend with
other providers of financial services including finance companies, credit unions and insurance companies. Despite having access to less resources and smaller lending limits, the Bank remains competitive in its service area with respect to interest
rates and fees charged on loans, interest rates paid on time and savings deposits, and service charges on deposit accounts. The deposit base of the Bank is relatively stable whereby seasonal fluctuations in the amount of deposits have not been
experienced. All of the Banks deposits emanate from inside the United States.

Statistical Disclosures by Bank
Holding Companies

I. Distribution of Assets, Liabilities and Stockholders Equity; Interest Rates and Interest Differential

Rate/Volume Analysis

The following
table presents the extent to which changes in interest rates and changes in the volume of interest-earning assets and interest-bearing liabilities have affected the Companys interest income and interest expense during the periods indicated.
Information is provided in each category with respect to (i) changes attributable to changes in volume (changes in volume multiplied by prior rate), (ii) changes attributable to changes in rate (changes in rate multiplied by prior volume)
and (iii) the changes attributable to the combined impact of volume and rate. The change in interest rate due to both rate and volume in the rate/volume analysis table table have been allocated to changes due to rate and volume in proportion to
the absolute amounts of changes in each.



|                                                                  |  |                                              |          |   |      |   |         |                         |  |   |          |  
|----------------------------------------------------------------- |  | -------------------------------------------- | -------- | - | ---- | - | ------- | ----------------------- |  | - | -------- | -
|                                                                  |  | For the Year Ended December 31, 2005 vs 2004 |         
|                                                                  |  | Increase (Decrease) Due to                   |         
|                                                                  |  | Volume                                       |          |   | Rate |   |         | TotalIncrease(Decrease) | 
|Interest-earning assets:                                          |  |                                              |          |   |      |   |         |                         |  |   |          |  
|Interest-bearing deposits with other banks and federal funds sold |  | $                                            | 6,103    |   |      | $ | 56,880  |                         |  | $ | 62,983   |  
|Taxable investment securities                                     |  |                                              | 344,576  |   |      |   | 64,952  |                         |  |   | 409,528  |  
|Nontaxable investment securities (1)                              |  |                                              | (120,953 | ) |      |   | (109    | )                       |  |   | (121,062 | )
|Loans (1)                                                         |  |                                              | (149,707 | ) |      |   | 95,627  |                         |  |   | (54,080  | )
|                                                                  |  |                                              |          |   |      |   |         |                         |  |   |          |  
|Total interest-earning assets                                     |  |                                              | 80,019   |   |      |   | 217,350 |                         |  |   | 297,369  |  
|                                                                  |  |                                              |          |   |      |   |         |                         |  |   |          |  
|Interest-bearing liabilities:                                     |  |                                              |          |   |      |   |         |                         |  |   |          |  
|Interest-bearing demand                                           |  |                                              | (31,138  | ) |      |   | 4,677   |                         |  |   | (26,461  | )
|Money market accounts                                             |  |                                              | 14,639   |   |      |   | (640    | )                       |  |   | 13,999   |  
|Savings deposits                                                  |  |                                              | (7,365   | ) |      |   | (1,804  | )                       |  |   | (9,169   | )
|Time deposits                                                     |  |                                              | 171,214  |   |      |   | 142,616 |                         |  |   | 313,830  |  
|Total borrowings                                                  |  |                                              | 24,862   |   |      |   | 63,172  |                         |  |   | 88,034   |  
|                                                                  |  |                                              |          |   |      |   |         |                         |  |   |          |  
|Total interest-bearing liabilities                                |  |                                              | 172,212  |   |      |   | 208,021 |                         |  |   | 380,233  |  
|                                                                  |  |                                              |          |   |      |   |         |                         |  |   |          |  
|Net change in net interest income                                 |  | $                                            | (92,193  | ) |      | $ | 9,329   |                         |  | $ | (82,864  | )
|                                                                  |  |                                              |          |   |      |   |         |                         |  |   |          |  

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|(1) | Computed on a tax equivalent basis using a 34% federal income tax rate.
|--- | -----------------------------------------------------------------------



Page 4



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Rate/Volume Analysis (continued)



|                                                                  |  |                                              |         |   |      |   |          |                         |  |   |          |  
|----------------------------------------------------------------- |  | -------------------------------------------- | ------- | - | ---- | - | -------- | ----------------------- |  | - | -------- | -
|                                                                  |  | For the Year Ended December 31, 2004 vs 2003 |        
|                                                                  |  | Increase (Decrease) Due to                   |        
|                                                                  |  | Volume                                       |         |   | Rate |   |          | TotalIncrease(Decrease) | 
|Interest-earning assets:                                          |  |                                              |         |   |      |   |          |                         |  |   |          |  
|Interest-bearing deposits with other banks and federal funds sold |  | $                                            | (11,627 | ) |      | $ | 7,798    |                         |  | $ | (3,829   | )
|Taxable investment securities                                     |  |                                              | 81,565  |   |      |   | (37,352  | )                       |  |   | 44,213   |  
|Nontaxable investment securities (1)                              |  |                                              | (75,543 | ) |      |   | (24,814  | )                       |  |   | (100,357 | )
|Loans (1)                                                         |  |                                              | 12,957  |   |      |   | (68,323  | )                       |  |   | (55,366  | )
|                                                                  |  |                                              |         |   |      |   |          |                         |  |   |          |  
|Total interest-earning assets                                     |  |                                              | 7,352   |   |      |   | (122,691 | )                       |  |   | (115,339 | )
|                                                                  |  |                                              |         |   |      |   |          |                         |  |   |          |  
|Interest-bearing liabilities:                                     |  |                                              |         |   |      |   |          |                         |  |   |          |  
|Interest-bearing demand                                           |  |                                              | (8,885  | ) |      |   | (21,741  | )                       |  |   | (30,626  | )
|Money market accounts                                             |  |                                              | 35,762  |   |      |   | (3,794   | )                       |  |   | 31,968   |  
|Savings deposits                                                  |  |                                              | 9,938   |   |      |   | (15,797  | )                       |  |   | (5,859   | )
|Time deposits                                                     |  |                                              | (34,940 | ) |      |   | (160,457 | )                       |  |   | (195,397 | )
|Total borrowings                                                  |  |                                              | 20,137  |   |      |   | 7,875    |                         |  |   | 28,012   |  
|                                                                  |  |                                              |         |   |      |   |          |                         |  |   |          |  
|Total interest-bearing liabilities                                |  |                                              | 22,012  |   |      |   | (193,914 | )                       |  |   | (171,902 | )
|                                                                  |  |                                              |         |   |      |   |          |                         |  |   |          |  
|Net change in net interest income                                 |  | $                                            | (14,660 | ) |      | $ | 71,223   |                         |  | $ | 56,563   |  
|                                                                  |  |                                              |         |   |      |   |          |                         |  |   |          |  

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|(1) | Computed on a tax equivalent basis using a 34% federal income tax rate.
|--- | -----------------------------------------------------------------------

Additional information required by this section is presented on page 44 of the 2005 Annual Report and is incorporated herein by reference.

II. Investment Portfolio

A. Book Value of Investment Portfolio

The required information is incorporated by reference to pages 22 through 24 of the 2005 Annual Report.

B. Maturity and Yield Information

The following table sets forth the maturity of investments at December 31, 2005 and the weighted average yields of such investments. The yields reflected are calculated based on the basis of the cost and effective yields for the
scheduled maturity of each investment.



|                                                 |  |                        |           |                                     |   |                                      |  |                     |           |       |   |           |  |   |           
|------------------------------------------------ |  | ---------------------- | --------- | ----------------------------------- | - | ------------------------------------ |  | ------------------- | --------- | ----- | - | --------- |  | - | ----------
|                                                 |  | Due in OneYear or Less |           | Due After OneYear ThroughFive Years |   | Due After FiveYears ThroughTen Years |  | Due After Ten Years |           | Total
|U.S. treasury securities                         |  | $                      | 98,267    |                                     | $ |                                     |  | $                   |          |       | $ |          |  | $ | 98,267    
|U.S. government agency securities                |  |                        | 500,000   |                                     |   | 15,710,662                           |  |                     | 3,022,502 |       |   |          |  |   | 19,233,164
|Obligations of states and political subdivisions |  |                        | 455,726   |                                     |   | 1,746,505                            |  |                     | 883,995   |       |   |          |  |   | 3,086,226 
|Mortgage-backed securities                       |  |                        | 24,431    |                                     |   | 2,046,828                            |  |                     | 2,295,077 |       |   | 7,321,320 |  |   | 11,687,656
|                                                 |  |                        |           |                                     |   |                                      |  |                     |           |       |   |           |  |   |           
|Total debt securities                            |  |                        | 1,078,424 |                                     |   | 19,503,995                           |  |                     | 6,201,574 |       |   | 7,321,320 |  |   | 34,105,313
|Mutual Funds (1)                                 |  |                        |          |                                     |   |                                     |  |                     |          |       |   |          |  |   | 1,000,000 
|                                                 |  |                        |           |                                     |   |                                      |  |                     |           |       |   |           |  |   |           
|Total                                            |  | $                      | 1,078,424 |                                     | $ | 19,503,995                           |  | $                   | 6,201,574 |       | $ | 7,321,320 |  | $ | 35,105,313
|                                                 |  |                        |           |                                     |   |                                      |  |                     |           |       |   |           |  |   |           

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|(1) | Consists of investment in Asset Management Fund ARM Fund.
|--- | ---------------------------------------------------------



Page 5



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B. Maturity and Yield Information (continued)



|                                                 |  |                       |   |  |                                     |   |  |                                      |   |  |                     |   |  |       |  
|------------------------------------------------ |  | --------------------- | - |  | ----------------------------------- | - |  | ------------------------------------ | - |  | ------------------- | - |  | ----- | -
|                                                 |  | Due in OneYear orLess |   |  | Due After OneYear ThroughFive Years |   |  | Due After FiveYears ThroughTen Years |   |  | Due After Ten Years |   |  | Total |  
|U.S. treasury securities                         |  | 3.50                  | % |  |                                    | % |  |                                     | % |  |                    | % |  | 3.50  | %
|U.S. government agency                           |  |                       |   |  |                                     |   |  |                                      |   |  |                     |   |  |       |  
|Securities                                       |  | 3.21                  |   |  | 3.90                                |   |  | 4.35                                 |   |  |                    |   |  | 3.95  |  
|Obligations of states and political subdivisions |  | 8.02                  |   |  | 7.47                                |   |  | 8.45                                 |   |  |                    |   |  | 7.83  |  
|Mortgage-backed securities                       |  | 4.29                  |   |  | 4.24                                |   |  | 4.96                                 |   |  | 4.82                |   |  | 4.74  |  
|                                                 |  |                       |   |  |                                     |   |  |                                      |   |  |                     |   |  |       |  
|Total debt securities                            |  | 5.47                  |   |  | 4.25                                |   |  | 5.16                                 |   |  | 4.82                |   |  | 4.57  |  
|Mutual Funds (1)                                 |  |                      |   |  |                                    |   |  |                                     |   |  |                    |   |  | 4.22  |  
|                                                 |  |                       |   |  |                                     |   |  |                                      |   |  |                     |   |  |       |  
|Total                                            |  | 5.47                  | % |  | 4.25                                | % |  | 5.16                                 | % |  | 4.82                | % |  | 4.56  | %
|                                                 |  |                       |   |  |                                     |   |  |                                      |   |  |                     |   |  |       |  

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|(1) | Consists of investment in Asset Management Fund ARM Fund.
|--- | ---------------------------------------------------------

Weighted
average yields are computed on a tax equivalent basis using a federal tax rate of 34% based on cost, adjusted for amortization of premium or accretion of discount.

C. Aggregate Book Value of Securities Exceeding 10% of Stockholders Equity

At December 31, 2005, non-U.S. government and U.S. government agency securities that exceeded ten percent of stockholders equity consisted of an investment in
The Asset Management Fund ARM Fund which invests solely in mortgage-backed securities issued or guaranteed by U.S. government agencies or government-sponsored enterprises or which are rated in the two highest investment grades.



|                                   |  |            |           |              |   |        
|---------------------------------- |  | ---------- | --------- | ------------ | - | -------
|Issuer                             |  | Book Value |           | Market Value
|The Asset Management Fund ARM Fund |  | $          | 1,000,000 |              | $ | 973,869

III. Loan Portfolio

A. Types of Loans

The following table sets forth the composition of the loan portfolio by type of loan at the dates indicated.



|                                         |  |                 |            |   |         |        |   |        |   |            |         |  |        |  
|---------------------------------------- |  | --------------- | ---------- | - | ------- | ------ | - | ------ | - | ---------- | ------- |  | ------ | -
|                                         |  | At December 31, |           
|                                         |  | 2005            |            |   | 2004    |       
|                                         |  | Amount          |            |   | Percent |        |   | Amount |   |            | Percent | 
|Real Estate Loans:                       |  |                 |            |   |         |        |   |        |   |            |         |  |        |  
|Construction                             |  | $               | 244,978    |   |         | 0.57   | % |        | $ | 205,617    |         |  | 0.46   | %
|1 - 4 Family                             |  |                 | 20,482,135 |   |         | 47.80  |   |        |   | 20,678,666 |         |  | 46.49  |  
|Commercial                               |  |                 | 5,354,511  |   |         | 12.50  |   |        |   | 6,317,945  |         |  | 14.21  |  
|Commercial Loans                         |  |                 | 11,437,916 |   |         | 26.70  |   |        |   | 11,405,854 |         |  | 25.64  |  
|Consumer Loans                           |  |                 | 5,326,311  |   |         | 12.43  |   |        |   | 5,869,705  |         |  | 13.20  |  
|                                         |  |                 |            |   |         |        |   |        |   |            |         |  |        |  
|Total                                    |  |                 | 42,845,851 |   |         | 100.00 | % |        |   | 44,477,787 |         |  | 100.00 | %
|                                         |  |                 |            |   |         |        |   |        |   |            |         |  |        |  
|Deferred loan origination fees and costs |  |                 | 10,304     |   |         |        |   |        |   | 6,381      |         |  |        |  
|Allowance for possible loan losses       |  |                 | (531,873   | ) |         |        |   |        |   | (501,301   | )       |  |        |  
|                                         |  |                 |            |   |         |        |   |        |   |            |         |  |        |  
|Net loans                                |  | $               | 42,324,282 |   |         |        |   |        | $ | 43,982,867 |         |  |        |  
|                                         |  |                 |            |   |         |        |   |        |   |            |         |  |        |  

The Banks lending policy requires the application and satisfaction of certain underwriting standards prior
to funding any loan, among which are documentation requirements to include credit and collateral value analysis. Credit qualifications entails evaluation of business cash flows or consumer income available to service debt payments. Secondary sources
of repayment, including collateral and guarantees may be requested as well. Lending opportunities typically are restricted to the market areas the Banks branches serve.



Page 6



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The Banks lending strategy has historically focused on the origination of a mixture in its portfolio of commercial
loans, one-to-four family mortgage loans and, to a lesser extent, working capital loans in the form of credit lines and term notes, personal loans, and home equity loans. Commercial real estate loans are granted for the acquisition or improvement of
real property. Generally, commercial real estate loans do not exceed 70% of the appraised value of the property pledged to secure the transaction. With repayment typically contingent upon successful operation of the subject real estate, this is
carefully scrutinized prior to approval.

Real estate construction loans are granted for the purpose of construction improvements to real property, both
commercial and residential. Real estate loans secured by one-to-four family residential housing properties are granted subject to statutory limits regarding the maximum percentage of appraised value of the mortgaged property. Residential loan terms
are normally established based upon factors such as interest rates in general, the supply of money available to the bank and the demand for such loans.

Consumer loans represent the extension of financing to customers for personal expenditures or household purposes. Creditworthiness is evaluated on the basis of projected repayment capacity as well as credit history. Such loans are granted
in the form of installment or revolving transactions.

B. Maturities and Sensitivities of Loans to Changes in Interest
Rates

The following table exhibits the maturity of commercial and real estate construction loans outstanding as of December 31, 2005, and the
amounts due after one year classified according to the sensitivity to changes in interest rates.



|                                        |  |               |           |                           |   |                  |  |       |           |  |   |           
|--------------------------------------- |  | ------------- | --------- | ------------------------- | - | ---------------- |  | ----- | --------- |  | - | ----------
|                                        |  | Maturing      |           |                          
|                                        |  | Within 1 Year |           | One YearThroughFive Years |   | After Five Years |  | Total
|Commercial and agricultural             |  | $             | 5,739,179 |                           | $ | 3,600,722        |  | $     | 2,098,015 |  | $ | 11,437,916
|Real estate - construction              |  |               | 244,978   |                           |   |                 |  |       |          |  |   | 205,617   
|                                        |  |               |           |                           |   |                  |  |       |           |  |   |           
|Total                                   |  | $             | 6,737,880 |                           | $ | 2,828,526        |  | $     | 2,045,065 |  | $ | 11,611,471
|                                        |  |               |           |                           |   |                  |  |       |           |  |   |           
|Sensitivity of loans to interest rates: |  |               |           |                           |   |                  |  |       |           |  |   |           
|Predetermined interest rates            |  |               |           |                           | $ | 2,147,405        |  | $     | 425,476   |  |   |           
|Floating interest rates                 |  |               |           |                           |   | 1,453,317        |  |       | 1,672,539 |  |   |           
|                                        |  |               |           |                           |   |                  |  |       |           |  |   |           
|Total                                   |  |               |           |                           | $ | 3,600,722        |  | $     | 2,098,015 |  |   |           
|                                        |  |               |           |                           |   |                  |  |       |           |  |   |           

C. Risk Elements

Certain information required by this section is presented on pages 9, 24 through 25 and 39 through 44 of the 2005 Annual Report and is incorporated herein by reference.

The following table sets forth information regarding non - performing assets:



|                                                                   |  |                 |           |   |      |   |           |  
|------------------------------------------------------------------ |  | --------------- | --------- | - | ---- | - | --------- | -
|                                                                   |  | At December 31, |          
|                                                                   |  | 2005            |           |   | 2004 |  
|Loans past due 90 days or more and still accruing interest         |  | $               | 465,806   |   |      | $ | 190,315   |  
|Nonaccrual loans                                                   |  |                 | 410,798   |   |      |   | 197,844   |  
|Impaired loans                                                     |  |                 | 640,390   |   |      |   | 733,378   |  
|                                                                   |  |                 |           |   |      |   |           |  
|Total non - performing loans                                       |  |                 | 1,516,994 |   |      |   | 1,121,537 |  
|Other real estate owned                                            |  |                 | 76,652    |   |      |   |          |  
|                                                                   |  |                 |           |   |      |   |           |  
|Total non - performing assets                                      |  | $               | 1,593,646 |   |      | $ | 1,121,537 |  
|                                                                   |  |                 |           |   |      |   |           |  
|Non-performing loans as a percentage of total loans                |  |                 | 3.54      | % |      |   | 2.52      | %
|Non-performing assets as a percentage of total assets              |  |                 | 1.70      | % |      |   | 1.23      | %
|Allowance for loan losses as a percentage of non-performing assets |  |                 | 33.4      | % |      |   | 44.7      | %



Page 7



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Non - performing assets include non - performing loans and other real estate owned. The Banks non-performing assets
do not represent or result from trends or uncertainties which management reasonably expects will materially impact future operating results, liquidity or capital resources. Impaired loans are commercial and commercial real estate loans for which it
is probable that the Bank will not be able to collect all amounts due according to the contractual terms of the loan agreement.

Although the Bank has a
diversified loan portfolio, a substantial portion of its debtors ability to honor their agreements is dependent upon the economic stability of the tri - state area. At December 31, 2005, the Company did not have any concentrations of
loans to borrowers engaged in similar activities exceeding 10% of total loans.

While it is impossible to predict what 2006 loan losses will be, there are
no potential problem loans outstanding at the end of any period presented for which there was serious doubt as to the ability of the borrower to comply with present loan repayment terms except as discussed above.

IV. Summary of Loan Loss Experience

A. Analysis of Loan Loss Experience

The following table sets forth information with respect to the banks allowance for loan losses at the dates indicated:



|                                                |  |                 |         |   |      |   |         |  
|----------------------------------------------- |  | --------------- | ------- | - | ---- | - | ------- | -
|                                                |  | At December 31, |        
|                                                |  | 2005            |         |   | 2004 |  
|Balance, January 1                              |  | $               | 501,301 |   |      | $ | 514,260 |  
|Charge - offs:                                  |  |                 |         |   |      |   |         |  
|Commercial and agricultural                     |  |                 | 12,034  |   |      |   | 53,537  |  
|Real estate mortgages                           |  |                 | 3,282   |   |      |   | 8,643   |  
|Consumer                                        |  |                 | 253,382 |   |      |   | 107,531 |  
|                                                |  |                 |         |   |      |   |         |  
|Total charge - offs                             |  |                 | 268,698 |   |      |   | 169,711 |  
|                                                |  |                 |         |   |      |   |         |  
|Loan recoveries:                                |  |                 |         |   |      |   |         |  
|Commercial and agricultural                     |  |                 | 7,000   |   |      |   | 10,525  |  
|Real estate mortgages                           |  |                 | 1,164   |   |      |   |        |  
|Consumer                                        |  |                 | 61,420  |   |      |   | 13,227  |  
|                                                |  |                 |         |   |      |   |         |  
|Total loan recoveries                           |  |                 | 69,584  |   |      |   | 23,752  |  
|                                                |  |                 |         |   |      |   |         |  
|Net charge - offs                               |  |                 | 199,114 |   |      |   | 145,959 |  
|                                                |  |                 |         |   |      |   |         |  
|Provision charged to operations                 |  |                 | 229,686 |   |      |   | 133,000 |  
|                                                |  |                 |         |   |      |   |         |  
|Balance, December 31                            |  | $               | 531,873 |   |      | $ | 501,301 |  
|                                                |  |                 |         |   |      |   |         |  
|Net charge - offs as a percent of average loans |  |                 | 0.46    | % |      |   | 0.17    | %

The Bank believes that the allowance for loan losses at December 31, 2005 is adequate to cover probable
losses inherent in the portfolio. However, there can be no assurance that the Bank will not sustain additional losses in future periods, which could be substantial in relation to the size of the allowance at December 31, 2005.

The Bank monitors its loan portfolio on a monthly basis, taking into consideration the status of potential problem loans and non- performing assets, as well as trends in
delinquencies. Managements determination of of the adequacy of the allowance for loan losses is based on periodic evaluations of the credit portfolio and other relevant factors. In addition to the estimate of the amounts and timing of expected
future cash flows on impaired loans, other components of the allowance for loan losses include estimates for loan losses associated within the commercial, consumer and real estate mortgage portfolios, general amounts for historical loss experience,
uncertainties in estimating losses, and inherent risks in the various credit portfolios.



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B. Allocation of the Allowance for Possible Loan Losses

The following table provides a breakdown of the allowance for loan losses for the periods indicated:



|                   |  |                 |         |                         |        |   |        |   |                         |  |        |  
|------------------ |  | --------------- | ------- | ----------------------- | ------ | - | ------ | - | ----------------------- |  | ------ | -
|                   |  | At December 31, |        
|                   |  | 2005            |         |                         | 2004   |  
|                   |  | Amount          |         | % of Loansto TotalLoans |        |   | Amount |   | % of Loansto TotalLoans | 
|Real Estate Loans: |  |                 |         |                         |        |   |        |   |                         |  |        |  
|Construction       |  | $               | 2,553   |                         | 0.57   | % |        | $ | 2,168                   |  | 0.46   | %
|1 - 4 Family       |  |                 | 97,599  |                         | 47.80  |   |        |   | 85,947                  |  | 46.49  |  
|Commercial         |  |                 | 157,540 |                         | 12.50  |   |        |   | 164,103                 |  | 14.21  |  
|Commercial Loans   |  |                 | 151,107 |                         | 26.70  |   |        |   | 116,703                 |  | 25.64  |  
|Consumer Loans     |  |                 | 112,436 |                         | 12.43  |   |        |   | 123,607                 |  | 13.20  |  
|                   |  |                 |         |                         |        |   |        |   |                         |  |        |  
|Unallocated        |  |                 | 10,638  |                         |        |   |        |   | 8,773                   |  |        |  
|                   |  |                 |         |                         |        |   |        |   |                         |  |        |  
|Total              |  | $               | 531,873 |                         | 100.00 | % |        | $ | 501,301                 |  | 100.00 | %
|                   |  |                 |         |                         |        |   |        |   |                         |  |        |  

The allocation of the allowance for possible loan losses is predicated upon periodic review and evaluation of
individual loans, past loss experience, risk elements associated with particular loan categories, and the impact of the economic environment. The allowance for loan losses is available to absorb credit losses arising from individual or portfolio
segments. When losses on specific loans are identified, the portion deemed uncollectable is charged off.

V. Deposits

A. Average Deposits and Rates Paid by Type

The following tables summarize the daily average amount of deposits and rates paid on such deposits for the periods indicated.



|                             |  |                         |            |   |      |   |            |  
|---------------------------- |  | ----------------------- | ---------- | - | ---- | - | ---------- | -
|                             |  | Year Ended December 31, |           
|                             |  | 2005                    |            |   | 2004 |  
|Amount                       |  |                         |            |   |      |   |            |  
|Noninterest - bearing demand |  | $                       | 15,009,559 |   |      | $ | 14,994,443 |  
|Interest - bearing demand    |  |                         | 10,924,706 |   |      |   | 15,168,547 |  
|Savings                      |  |                         | 12,920,725 |   |      |   | 13,756,216 |  
|Money market                 |  |                         | 8,039,124  |   |      |   | 6,838,628  |  
|Time                         |  |                         | 30,092,501 |   |      |   | 23,378,607 |  
|                             |  |                         |            |   |      |   |            |  
|Total                        |  | $                       | 76,986,615 |   |      | $ | 74,136,441 |  
|                             |  |                         |            |   |      |   |            |  
|Rate                         |  |                         |            |   |      |   |            |  
|Noninterest - bearing demand |  |                         |           | % |      |   |           | %
|Interest - bearing demand    |  |                         | 0.73       |   |      |   | 0.50       |  
|Savings deposits             |  |                         | 0.88       |   |      |   | 0.85       |  
|Money market                 |  |                         | 1.22       |   |      |   | 1.25       |  
|Time deposits                |  |                         | 2.82       |   |      |   | 1.91       |  

Remaining maturity of time certificates of deposit in denominations of
$100,000 or more.

The required information is incorporated by reference to page 26 of the 2005 Annual Report.



Page 9



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VI. Return on Equity and Assets

The required information is incorporated by reference to page 9 of the 2005 Annual Report.

VII. Short - Term Borrowings

The
required information is incorporated by reference to page 27 of the 2005 Annual Report.

Item 2. Description of Properties

The following are the principal locations and operations of the Company and its
subsidiaries:



|                                                                                                            |  |             |  |                
|----------------------------------------------------------------------------------------------------------- |  | ----------- |  | ---------------
|Description                                                                                                 |  | Own orLease |  | LeaseExpiration
|Executive Offices of the Company and Bank and Branch office 16924 St. Clair Avenue East Liverpool, OH 43920 |  | Own         |  | N/A            
|                                                                                                            |  |            
|Branch office Jefferson & Lincoln
Way Lisbon, OH 44432                                                      |  | Own         |  | N/A            
|                                                                                                            |  |            
|Branch office 15703 St Rt. 170 Calcutta, OH 43920                                                           |  | Lease       |  | 2007           
|                                                                                                            |  |            
|Branch office Wal-Mart Store Calcutta, OH 43920                                                             |  | Lease       |  | 2008           
|                                                                                                            |  |            
|Branch office 1200 North Chestnut Street New Cumberland, WV 26047                                           |  | Own         |  | N/A            
|                                                                                                            |  |            
|Branch office 627 Midland Avenue Midland, PA 15059                                                          |  | Own         |  | N/A            
|                                                                                                            |  |            
|Branch office Bradshaw Square East Liverpool, Ohio 43920                                                    |  | Lease       |  | 2010           
|                                                                                                            |  |            
|MDH Investment Management 1216 Forsyth Place
East Liverpool, Ohio 43920                                     |  | Lease       |  | 2009           

Management asserts that for insurance purposes all facilities and equipment are subject to periodic appraisal and
all properties are adequately insured.

Item 3. Legal Proceedings

On March 3, 2006, Kimberly Bank, an individual residing in Columbiana County, Ohio filed
suit in the Court of Common Pleas of Columbia County Ohio against 1st National Community Bank (the Bank) and Keith Clutter the former President of the Bank. The complaint alleges that the plaintiff, while a customer of the Bank was
physically and sexually assaulted by Mr. Clutter. The claims against the Bank include alleged violation of the Banks fiduciary duties and other obligations owned by the Bank to the Plaintiff. The complaint also alleges that the Bank
violated the Truth in Lending Act, Fair Debt Collections Act, the Ohio Consumer Protection Laws and other laws and acts designed to protect consumers. The complaint seeks monetary damages of one million dollars plus cost of suit and the
cancellation of any indebtedness the Plaintiff owes to the Bank.

The Bank has not yet been formally served with the complaint and has not yet formulated
its answer or defense. The Bank intends to vigorously defend the action.



Page 10



---

No matters were submitted to a vote of security holders during the fourth quarter of fiscal 2005.

PART II

Item 5. Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Certain
information is incorporated by reference to page 10 of the 2005 Annual Report.

The company repurchased 5,510 shares of common stock at an average price of
18.07 in the fourth quarter of 2005

Item 6. Managements Discussion and Analysis or Plan of Operations

The required information is incorporated by
reference to pages 39 through 44 of the 2005 Annual Report.

Item 7. Financial Statements

The required information is incorporated by reference to pages 11 through 37 of the 2005
Annual Report.

Critical Accounting Policies

The
Companys accounting policies are integral to understanding the results reported. The accounting policies are described in detail in Note 1 of the consolidated financial statements. Our most complex accounting policies require managements
judgment to ascertain the valuation of assets, liabilities, commitments and contingencies. We have established detailed policies and control procedures that are intended to ensure valuation methods are well controlled and applied consistently from
period to period. In addition, the policies and procedures are intended to ensure that the process for changing methodologies occurs in an appropriate manner. The following is a brief description of our current accounting policies involving
significant management valuation judgements.

Allowance for Loan Loss

Arriving at an appropriate level of allowance for loan losses involves a high degree of judgment. The Companys allowance for loan losses provides for probable
losses based upon evaluations of known, and inherent risks in the loan portfolio.

Management uses historical information to assess the adequacy of the
allowance for loan losses as well as the prevailing business environment; as it is affected by changing economic conditions and various external factors, which may impact the portfolio in ways currently unforeseen. The allowance is increased by
provisions for loan losses and by recoveries of loans previously charged-off and reduced by loans charged-off. For a full discussion of the Companys methodology of assessing the adequacy of the reserve for loan losses, refer to Note 1 of
Notes to Consolidated Financial Statements.

Item 8. Changes In and Disagreements With Accountants on Accounting and Financial Disclosure

None.

Item 8A. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Based on their evaluation as of a date within 90 days of the filing date of this annual report on Form 10KSB, the Companys principal executive
officer and principal financial officer have concluded that the Companys disclosure controls and procedures (as defined in Rules 13a-14c under the Securities and Excgange Act of 1934, the Exchange Act) are effective to ensure that
information required to be disclosed by the Company in reports that it files or submits under the exchange act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.



Page 11



---

Changes in Internal Controls

There were no significant changes in the Companys internal controls or other factors that could significantly affect these controls subsequent to the date of their
evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

PART III

Item 9. Directors and Executive Officers of the Issuer

The required information is incorporated by reference to pages 4
through 5 of the 2005 Proxy Statement.

Item 10. Executive Compensation

The required information is incorporated by reference to page 6 through 7 of the 2005
Proxy Statement.

Item 11. Security Ownership of Certain Beneficial Owners and Management

The required information is incorporated by
reference to pages 8 through 9 of the 2005 Proxy Statement.

Item 12. Certain Relationships and Related Transactions

The required information is incorporated by reference to page 9
of the 2005 Proxy Statement.

Item 13. Exhibits and Reports on Form 8 - K

The following documents are filed as part of this report, except as may be
indicated:

(1) Financial Statements:

The following Consolidated Financial Statements of Tri - State 1st Banc, Inc. together with the Report of Independent Auditors dated January 28, 2005, are included in the 2005 Annual Report of the registrant
which is referenced in Part II, Item 7 - Financial Statements and are incorporated herein:



|                                                                                              |  |               
|--------------------------------------------------------------------------------------------- |  | --------------
|                                                                                              |  | Page Reference
|Report of Independent Auditors                                                                |  | 11            
|Consolidated Balance Sheet, December 31, 2005 and 2004                                        |  | 12            
|Consolidated Statement of Income for the years ended December 31, 2005 and 2004               |  | 13            
|Consolidated Statement of Stockholders Equity for the years ended December 31, 2005 and 2004 |  | 14            
|Consolidated Statement of Cash Flows for the years ended December 31, 2005 and 2004           |  | 15            
|Notes to Consolidated Financial Statements                                                    |  | 16-37         



Page 12



---

(2) Exhibits and reports of Form 8-K:



|(a) | Exhibits filed herewith or incorporated by reference are set forth in the following table prepared in accordance with item 601 of Regulation S - B.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------



|       |  |                                                                                                                                                                                                              
|------ |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(3.1)  |  | Articles of Incorporation of the registrant are incorporated herein by reference to the registrants Registration Statement on Form S - 4 filed with the Securities and Exchange
Commission on March 8, 1996.
|       | 
|(3.2)  |  | By - laws of the registrant are incorporated by reference to the registrants Registration Statement on Form S - 4 filed with the Securities and Exchange Commission on March 8,
1996.                       
|       | 
|(10.1) |  | The 1997 Stock Option Plan is incorporated by reference to the registrants admendment No. 1 Registration Statement Form SB-2 filed with the Securities and Exchange Commission on December
1, 1999.         
|       | 
|(13)   |  | Portions of the Annual Report to Security Holders for the year ended December 31, 2005, filed herewith as exhibit 13.                                                                                        
|       | 
|(21)   |  | Subsidiary of the registrant incorporated herein by reference to the registrants Registration Statement on Form S - 4 filed with the Securities and Exchange Commission on March 8,
1996.                   
|       | 
|(31.0) |  | Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                       
|       | 
|(32.0) |  | Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                       



|(b) | Reports on Form 8-K
|--- | -------------------

On
November 10, 2005 the Company issued a press release entitled 1st Banc Reports Earnings for Third Quarter 2005 under Form 8-K Item 5.

On November 21, 2005 the Company issued a press release entitled Tri-State 1st Banc, Inc. Declares Dividend under Form
8-K Item 5.

On November, 2005 the Company file an 8-K detailing the appointment of interim CFO Beadnell to the
permanent position under Form 8-K Item 5.

Item 14. Principal Accountant Fees and Services

The required information is incorporated by reference to page 10 of the
2005 Proxy Statement.



Page 13



---

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant has caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.



|                    |  |     |  |                        
|------------------- |  | --- |  | -----------------------
|Date: March 2, 2005 |  | By: |  | /s/ Charles B. Lang    
|                    |  |     |  | Charles B. Lang        
|                    |  |     |  | President              
|Date: March 2, 2005 |  |     |  |                        
|                    |  | By: |  | /s/ Stephen Beadnell   
|                    |  |     |  | Stephen Beadnell       
|                    |  |     |  | Chief Financial Officer

In accordance with the Exchange Act, this report has been signed below by the persons on behalf of the registrant
and in the capacities and on the dates indicated.



|                                                |  |                                                                  |  |              
|----------------------------------------------- |  | ---------------------------------------------------------------- |  | -------------
|Name                                            |  | Title                                                            |  | Date         
|/s/ Charles B. Lang Charles B.
Lang             |  | President (Principal Executive Officer)                          |  | March 1, 2006
|                                                |  |                                                                 
|/s/ Keith R. Clutter Keith R.
Clutter           |  | Secretary                                                        |  | March 1, 2006
|                                                |  |                                                                 
|/s/ Stephen Beadnell Stephen
Beadnell           |  | Chief Financial Officer (Principal Financial/Accounting Officer) |  | March 1, 2006
|                                                |  |                                                                 
|/s/ Edward L. Baumgardner Edward L.
Baumgardner |  | Director                                                         |  |              
|                                                |  |                                                                 
|/s/ J. Robert Berg J. Robert
Berg               |  | Director                                                         |  | March 1, 2006
|                                                |  |                                                                 
|/s/ William E. Blair William E.
Blair           |  | Director                                                         |  | March 1, 2006
|                                                |  |                                                                 
|/s/ Stephen W. Cooper Stephen W.
Cooper         |  | Director                                                         |  | March 1, 2006
|                                                |  |                                                                 
|/s/ Timothy G. Dickey Timothy G.
Dickey         |  | Director                                                         |  | March 1, 2006
|                                                |  |                                                                 
|/s/ Marvin H. Feldman Marvin H.
Feldman         |  | Director                                                         |  | March 1, 2006
|                                                |  |                                                                 
|/s/ John P. Scotford John P.
Scotford           |  | Director                                                         |  | March 1, 2006
|                                                |  |                                                                 
|/s/ John C. Thompson John C.
Thompson           |  | Director                                                         |  | March 1, 2006



Page 14