SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                                   FORM 10-KSB
                   [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR
                  15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

                   For the fiscal year ended December 31, 2002

                                       OR

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

                        For the transition period from to

                        Commission File Number: 333-32245

                           HEARTLAND BANCSHARES, INC.
                 (Name of small business issuer in its charter)

Indiana                                                          35-2017085
(State or Other Jurisdiction of Incorporation             (IRS Employer Id. No.)
 or Organization)

420 North Morton Street
Franklin, Indiana                                                 46131
(Address of principal executive offices)                        (Zip Code)

Issuer's telephone number, including area code:  (317) 738-3915

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

Securities registered pursuant to Section 12(g) of the Act:  None

Check  whether  the issuer  (1) has filed all  reports  required  to be filed by
Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter  period that the  registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days.

                           Yes      X        No
                                 -----          -----

Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained herein, and no disclosure will be contained, to
the best of issuer's knowledge, in definitive proxy or information
statements incorporated by reference in part III of this Form 10-KSB or any
amendment to this Form 10-KSB.  [X]
                               -----
State issuer's revenues for its most recent fiscal year: $12,907,000

Aggregate  market  value of common  stock  held by  non-affiliates  computed  by
reference  to the sale  price of such  stock as of March  14,  2003 of $8.00 per
share $10,252,152

Shares of common stock outstanding as of March 14, 2003: 1,394,172



<PAGE>


DOCUMENTS INCORPORATED BY REFERENCE:
1. Portions of the Annual Report to Shareholders of Heartland  Bancshares,  Inc.
   for the year ended  December  31,  2002,  to the extent  stated  herein,  are
   incorporated by reference from Exhibit 13 into Parts I and II.
2. Portions of the Proxy Statement of Heartland Bancshares,  Inc. for the Annual
   Meeting  of its  Shareholders  to be held May 5, 2003,  to the extent  stated
   herein, are incorporated by reference from Exhibit 99.1 into Part III.



<PAGE>




                          FORM 10-KSB TABLE OF CONTENTS

PART I                                                              Page

Item  1.  Description of Business                                     4
Item  2.  Description of property                                    18
Item  3.  Legal Proceedings                                          19
Item  4.  Submission of Matters to a Vote of Security Holders        19

PART II

Item  5.  Market for Common Equity and Related Stockholder Matters   20
Item  6.  Management's Discussion and Analysis of Financial
          Condition and Results of Operations                        20
Item  7.  Financial Statements                                       20
Item  8.  Changes in and Disagreements with Accountants on
          Accounting and Financial Disclosure                        20

PART III

Item  9.  Directors, Executive Officers, Promoters and Control
          Persons; Compliance With Section 16(a) of the Exchange
          Act                                                        21
Item 10.  Executive Compensation                                     21
Item 11.  Security Ownership of Certain Beneficial Owners
          and Management and Related Stockholder Matters             22
Item 12.  Certain Relationships and Related Transactions             22
Item 13.  Exhibits and Reports on Form 8-K                           23
Item 14.  Controls and Procedures                                    24
Signatures                                                           25
Certifications

<PAGE>





                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS  (Dollar  amounts are in thousands,  except per
share data.)

GENERAL

Heartland Bancshares,  Inc. ("Heartland" or the "Company") is a one-bank holding
company  incorporated May 27, 1997.  Heartland raised  approximately  $11,731 in
equity capital through the sale of 1,394,172 shares of Heartland's  common stock
at $9.07 per share, net of underwriting  discounts and offering costs.  Proceeds
were used to  capitalize  Heartland  Community  Bank (the  "Bank"),  Heartland's
primary  asset,  a  wholly-owned   banking  subsidiary,   an   Indiana-chartered
commercial  bank. The Bank received  regulatory  approval to open in the fall of
1997 and commenced banking operation December 17, 1997.

During the three year period  ended  December  31,  2002,  Heartland's  business
focused on the  development of the business of the Bank.  Material  developments
during  this  three  year  period  included  the  opening  by the  Bank of a new
operations  center  in  Franklin  during  2001  (see  "Item  2.  Description  of
Property"),  the issuance by Heartland of trust preferred securities during 2001
(see Note 8 to the consolidated  financial statements included in Item 7 of this
Report,  which note is incorporated  herein by reference),  and the entry by the
Bank's  regulators of a cease and desist order against the Bank in May 2002 (see
the description of this Order under "Regulation and Supervision of Heartland and
the Bank," below).  Certain financial data reflecting  Heartland's  consolidated
financial   condition  as  of  December  31,  2002,  2001,  and  2000,  and  its
consolidated  results of operations  for each of the three years ended  December
31, 2002, is included under the heading "SELECTED FINANCIAL DATA" below.

The Bank operates from offices located in Franklin, Greenwood, and Bargersville,
Indiana.

The business of the Bank  consists  primarily of  attracting  deposits  from the
general public,  originating  commercial,  residential  real estate and consumer
loans  and  purchasing  and  selling  certain  investment  securities.  The Bank
operates a full-service  brokerage  department in order to sell mutual funds and
other non-deposit investment products to the public and a certificate of deposit
brokerage program.

Heartland  offers  commercial  loans to area  businesses in addition to new home
construction loans and business lines of credit.  Consumer loans include,  among
others,  new and used automobile and other secured and unsecured personal loans.
Heartland originates adjustable rate first mortgage loans, second mortgage loans
and home equity lines of credit secured by single-family homes.

As of December 31, 2002,  the Bank had 86 full time  equivalent  employees.  The
Bank utilizes a leased employee arrangement with a third party company,  whereby
all  employees  are  leased  to the  Bank  from the  third  party  company.  The
arrangement  allows for employees to  participate in group benefits of the third
party company.  The third party company also  administers  the majority of human
resource activities including payroll,  payroll taxes and policy administration.
Heartland has no full time employees.

Dollar amounts in thousands except per share data.

<PAGE>


SERVICE AREA

The Bank's primary service area is Johnson county,  Indiana.  Johnson County was
ranked the third  fastest  growing  County in  Indiana  since 1990 by the United
States  Census  Bureau in the 2000 census.  Census data may be obtained from the
Census  Bureau  Internet  site  WWW.Census.gov.   The  majority  of  Heartland's
customers reside in Johnson County.  The Bank has one branch in Franklin and two
in Greenwood,  which are the two largest  cities in the county,  and a branch in
Bargersville, in southwestern Johnson County.

COMPETITION

Heartland and the Bank face strong  competition  for  deposits,  loans and other
financial services from numerous Indiana and out-of-state banks, thrifts, credit
unions and other financial  institutions as well as other entities which provide
financial services,  including consumer finance companies,  securities brokerage
firms,  mortgage brokers,  equipment  leasing  companies,  insurance  companies,
mutual funds and other lending sources and investment alternatives.  Some of the
financial institutions and financial services organizations with which Heartland
competes are not subject to the same degree of regulation as Heartland.  Many of
the  financial  institutions  aggressively  compete for business in  Heartland's
market areas.  Many of these  competitors  have been in business for many years,
have established  customer bases, have substantially  higher lending limits than
Heartland,  are larger and will be able to offer certain services that Heartland
does not currently offer, including international banking services. In addition,
most of these entities have greater  capital  resources than  Heartland,  which,
among  other  things,  may allow them to price  their  services  at levels  more
favorable to the customer and to provide  larger  credit  facilities  than could
Heartland.

REGULATION AND SUPERVISION OF HEARTLAND AND THE BANK

Heartland is registered as a bank holding company under the Bank Holding Company
Act of 1956,  as amended  ("BHCA"),  with the Board of  Governors of the Federal
Reserve System ("Federal Reserve") and is subject to examination, regulation and
supervision  by the  Federal  Reserve.  The Bank's  deposits  are insured to the
maximum extent  permitted by law by the Federal  Deposit  Insurance  Corporation
("FDIC").  The Bank is  subject to  comprehensive  regulation,  examination  and
supervision by the Indiana Department of Financial  Institutions ("DFI") and the
FDIC. Regulation, examination and supervision by banking regulatory agencies are
primarily for the benefit of depositors rather than shareholders.

Under the BHCA, a bank holding company is, with limited  exceptions,  prohibited
from  acquiring  direct or indirect  ownership or control of voting stock of any
company  which is not a bank,  and from  engaging  in any  activity  other  than
managing or controlling  banks. A bank holding company may, however,  own shares
of a company engaged in activities that the Federal Reserve has determined to be
so closely related to banking or managing or controlling banks as to be a proper
incident thereto. In addition,  a bank holding company meeting certain financial
and other  requirements may elect to be treated as a "financial holding company"
and  engage  in, or own  shares of  companies  that are  engaged  in,  insurance
underwriting,  securities  underwriting,  merchant banking,  and other financial
services  activities.  Heartland  has not  elected to be treated as a  financial
holding company.

The Bank may generally engage in activities that are permissible  activities for
state  chartered  banks  under  Indiana  banking  law,  without  regard  to  the
limitations that might apply to such activities under the BHCA if Heartland were
to engage directly in such activities.

Dollar amounts in thousands except per share data.

<PAGE>


Indiana law and the BHCA  restrict  certain  types of expansion by Heartland and
the Bank.  Heartland  and the Bank may be required  to apply for prior  approval
from (or give  prior  notice  and an  opportunity  for  review  to) the  Federal
Reserve,  the FDIC, the DFI,  and/or other bank  regulatory or other  regulatory
agencies,  as a condition to the acquisition or establishment of new offices, or
the  acquisition  (by merger or  consolidation,  purchase or  otherwise)  of the
stock, business or properties of other banks or other companies.

Effective May 11, 2002, with the consent of the Bank, the FDIC and DFI entered a
formal order under federal and state banking laws (the "May 2002 Order"),  under
which the Bank and its  Directors  are required to take a number of  affirmative
steps to address regulatory concerns,  including but not limited to, maintaining
the Bank's ratio of Tier 1 capital to assets at 8% or above;  committing  not to
declare or pay  dividends  to the  Corporation  that would  result in the Bank's
violation of the required  capital ratio;  limiting growth in total assets to no
more than three percent in any three month period  without  advance  approval by
the regulators,  or more than 12% annually;  adopting and implementing  plans to
resolve certain criticized assets;  eliminating or restricting future lending to
borrowers whose loans have been  criticized by the regulators;  and adopting and
implementing plans to reduce the volume of the Bank's  acquisition,  development
and construction  loans,  commercial  real-estate  loans and high  loan-to-value
loans, as defined by FDIC Regulation Part 365, in relation to its capital.

Under the May 2002 Order,  the Bank is required during the first quarter of 2003
to further  reduce its commercial  loans secured by commercial  real estate to a
certain  specified  level  in  relation  to the  Bank's  capital.  The  Bank has
requested  adjustments to the May 2002 Order,  which,  if approved by the Bank's
regulators,  would  allow the Bank to retain  the  levels  of  commercial  loans
outstanding  at December 31, 2002. As of March 28, 2003,  the Bank's  regulators
had not yet notified the Bank of their decision on the Bank's  request.  If such
request is not approved,  the Bank would be required either to reduce the amount
of its  commercial  loans  secured by  commercial  real estate by an  additional
approximately  $2,309 from the  December  31, 2002  totals,  or to increase  the
Bank's  Tier 1 capital  by  approximately  $1,300 in order to permit the Bank to
comply  with the ratio  required by the May 2002  Order.  As of March 28,  2003,
Heartland (the parent company) had sufficient  funds in excess of its forecasted
2003 parent company cash  requirements  to make the required  capital  injection
into the Bank (see "Parent Company  Liquidity" below in Item 6. of this report),
if necessary for the Bank to comply with the ratio  requirements of the May 2002
Order  regarding  volume  of  commercial  loans  secured  by  real  estate,  and
management  expects that Heartland  would  contribute such amount to the Bank as
additional  capital if the Bank's request for  adjustments to the May 2002 Order
in this regard were not approved by the Bank's regulators.

See Item 6 of this Report for additional  discussion of the effects that the May
2002 Order have had,  and are  expected to continue  to have,  on the  financial
condition, results of operations,  liquidity and financial resources of the Bank
and of Heartland.

Heartland is a legal  entity  separate  and  distinct  from the Bank.  There are
various  legal  limitations  on the extent to which the Bank can supply funds to
Heartland.  The principal source of Heartland's funds consists of dividends from
the Bank.  State and federal laws  restrict the amount of dividends  that may be
paid by banks.  In addition,  the May 2002 Order requires the Bank to maintain a
ratio of Tier 1 capital to total  assets of not less than 8.0% and refrain  from
paying  dividends that would cause that ratio  requirement  to be violated.  The
Bank's  Tier I Capital to total  assets  ratio at  December  31,  2002 was 8.45%
(8.35% using average assets).

Dollar amounts in thousands except per share data.

<PAGE>

In addition,  the Bank is subject to certain restrictions imposed by the Federal
Reserve on  extensions  of credit to  Heartland or any of its  subsidiaries,  or
investments in the stock or other securities as collateral for loans.

The  commercial  banking  business  is  affected  not only by  general  economic
conditions  but  also by the  monetary  policies  of the  Federal  Reserve.  The
instruments  of monetary  policy  employed by the  Federal  Reserve  include the
discount  rate on member  bank  borrowing  and  changes in reserve  requirements
against  member bank  deposits.  Federal  Reserve  monetary  policies have had a
significant  effect on the operating results of commercial banks in the past and
are expected to continue to do so in the future. In view of changing  conditions
in the  national  economy  and in the money  markets,  as well as the  effect of
actions by  monetary  fiscal  authorities,  including  the Federal  Reserve,  no
prediction can be made as to possible future changes in interest rates,  deposit
levels, loan demand or the business and earnings of Heartland and the Bank.

Forward-Looking Statements

Heartland  from  time to time  in its  oral  and  written  communications  makes
statements  relating to its  expectations  regarding the future.  These types of
statements are considered "forward-looking statements" within the meaning of the
Private  Securities   Litigation  Reform  Act  of  1995.  Such  forward  looking
statements  can include  statements  about adequacy of allowance for loan losses
and the quality of the Company's loans and other assets;  simulations of changes
in interest rates; litigation results;  dividend policy; estimated cost savings,
plans and objectives for future operations;  the expected impact of the May 2002
Order on the  assets,  liabilities,  interest  income and  yields,  non-interest
expense,  capital  resources and liquidity of Heartland and the Bank;  and other
expectations  about the Company's  financial and business  performance and other
business  matters as well as economic  and market  conditions  and trends.  They
often  can be  identified  by the use of words  like  "expect,"  "may,"  "will,"
"would,"  "could,"  "should",  "intend,"  "project,"  "estimate,"  "believe"  or
"anticipate," or similar expressions.

Heartland may include forward-looking  statements in filings with the Securities
and Exchange  Commission  ("SEC"),  such as this Form 10-KSB,  in other  written
materials,  and in  oral  statements  made by  senior  management  to  analysts,
investors,  representatives  of the media, and others. It is intended that these
forward-looking  statements  speak  only  as of the  date  they  are  made,  and
Heartland  undertakes no obligation to update any  forward-looking  statement to
reflect  events or  circumstances  after  the date on which the  forward-looking
statement is made.

Dollar amounts in thousands except per share data.

<PAGE>


Readers are  cautioned  that, by their nature,  forward-looking  statements  are
based on assumptions and are subject to risks, uncertainties, and other factors.
Actual results may differ  materially from the  expectations of the Company that
are  expressed  or  implied by any  forward-looking  statement.  The  discussion
incorporated  by  reference  into  Item 7 of  this  Form  10-KSB,  "Management's
Discussion and Analysis of Financial Condition and Results of Operations," lists
some of the  factors  that  could  cause the  Company's  actual  results to vary
materially  from those expressed or implied by any  forward-looking  statements.
Other  uncertainties  that  could  cause the  Company's  actual  results to vary
materially  from those  expressed  or implied by any  forward-looking  statement
include the effects of changes in competitive conditions;  acquisitions of other
businesses by the Company and costs of integrations of such acquired businesses;
the  introduction,  withdrawal,  success and timing of business  initiatives and
strategies;  changes in customer  borrowing,  repayment,  investment and deposit
practices;  changes in fiscal, monetary and tax policies;  inflation; changes in
interest rates and financial and capital  markets;  changes in general  economic
conditions,  either nationally or regionally,  resulting in, among other things,
credit quality  deterioration;  the impact,  extent and timing of  technological
changes; capital management activities; actions of the Federal Reserve Board and
legislative  and regulatory  actions and reforms;  and the impact on the Bank of
the asset growth, capital, loan concentration reduction, and other provisions of
the May 2002 Order,  including  the decision of the FDIC and DFI with respect to
the Bank's pending  request for an adjustment to the terms of the May 2002 Order
and the  possibility for other changes in the May 2002 Order.  Investors  should
consider  these  risks,  uncertainties,  and other  factors in addition to those
mentioned  by  Heartland  in its  other  SEC  filings  from  time to  time  when
considering any forward-looking statement.


SELECTED FINANCIAL DATA

The  information  presented  below  should  be  read  in  conjunction  with  the
consolidated financial statements, which are incorporated by reference into Item
7 of this Report from Exhibit 13, and  "Management's  Discussion and Analysis of
Financial  Condition  and  Results  of  Operations,"  which is  incorporated  by
reference into Item 6 of this Report from Exhibit 13.


                                       Year Ended     Year Ended     Year Ended
                                      December 31,   December 31,   December 31,
Income Statement Data:                    2002           2001           2000
                                          ----           ----           ----

Total interest income                 $  10,972      $  14,409      $  12,476
Total interest expense                    4,198          6,789          6,347
                                      ---------      ---------      ---------
Net interest income                       6,774          7,620          6,129
Provision for loan losses                 3,150          2,967          1,744
Noninterest income                        1,935          1,596            767
Noninterest expense                       7,609          5,416          3,929
Provision for income taxes                 (837)           304            472
                                      ---------      ---------      ---------
Net income/(loss)                     $  (1,213)     $     529      $     751
                                      =========      =========      =========
Net income per share/(loss)                (.87)           .38   $        .54
Average shares                        1,394,172      1,394,172      1,394,172


Dollar amounts in thousands except per share data.

<PAGE>



                                       Year Ended     Year Ended
                                      December 31,   December 31,
Income Statement Data:                    1999           1998
                                          ----           ----

Total interest income                 $   7,478      $   3,140
Total interest expense                    3,612          1,307
                                      ---------      ---------
Net interest income                       3,866          1,833
Provision for loan losses                   656            700
Noninterest income                          297             56
Noninterest expense                       2,352          1,817
Provision for income taxes              __  182              -
                                      ---------      ---------
Net income/(loss)                     $     973      $    (628)
                                      =========      =========
Net income/(loss) per share           $     .70      $    (.45)
Average shares                        1,394,172      1,394,172


                                         At             At             At
                                     December 31,   December 31,    December 31,
                                        2002           2001           2000
                                        ----           ----           ----
Balance Sheet Data:
Total Assets                          $ 176,657      $ 189,517      $ 164,916
Loans, Net of Allowance
  for Loan Losses                       116,422        143,236        129,882
Demand & Savings Deposits                78,950         86,341         64,598
Time Deposits                            69,449         74,650         74,622
Borrowings                               15,251         14,554         12,273
Shareholders' Equity                     12,200         13,263         12,658
Book Value Per Share                  $    8.75      $    9.51      $    9.08
Equity to Asset Ratio                      6.91%          7.00%          7.68%

                                           At             At
                                      December 31,    December 31,
                                          1999           1998
                                          ----           ----
Balance Sheet Data:
Total Assets                          $ 110,139      $  64,660
Loans, Net of Allowance
  for Loan Losses                        89,680         48,700
Demand & Savings Deposits                38,135         17,738
Time Deposits                            50,384         35,016
Borrowings                                9,519            740
Shareholders' Equity                     11,643         10,916
Book Value Per Share                  $    8.35      $    7.83
Equity to Asset Ratio                     10.57%         16.88%



<PAGE>


AVERAGE  BALANCES,  INCOME,  EXPENSES AND RATES. The following tables depict for
the years ended December 31, 2002, 2001, and 2000, certain  information  related
to  Heartland's  average  balance  sheets and its  average  yields on assets and
average  costs of  liabilities.  Such yields are  derived by dividing  income or
expense by the  average  balance  of the  corresponding  assets or  liabilities.
Average balances have been derived from daily averages.



                                 Year Ended                   Year Ended
                              December 31, 2002            December 31, 2001
                              -----------------            -----------------
                           Average/  Income/ Yield/    Average/   Income/ Yield/
                           Balance   Expense  Rate     Balance    Expense  Rate
                           -------   -------  ----     -------    -------  ----
Interest earning assets
   Short-term investments  $ 12,992  $  230   1.77%    $  6,060  $    225  3.71%
   Taxable securities        15,893     965   6.07       18,586     1,365  7.34
   Non-taxable securities     2,626     123   4.68        1,489        67  4.50
   Loans                    135,433   9,654   7.13      145,961    12,752  8.74
                           --------  ------            --------  --------
Total interest earning
 assets                    $166,944  $10,972  6.57     $172,096  $ 14,409  8.37
                           ========  =======           ========  ========

Interest bearing liabilities
   Interest-bearing demand,
     Money Market and
     Savings Deposits      $ 63,002  $  971   1.54%    $ 59,639  $  1,784  2.99%
   Time deposits             70,929   2,700   3.81       81,071     4,531  5.59
   Short-term borrowings      4,872      74   1.52        6,174       223  3.61
   Other borrowings           9,000     453   5.03        4,222       251  5.95
                           --------  ------            --------  --------
Total interest bearing
 liabilities               $147,803  $4,198   2.84     $151,106  $  6,789  4.49
                           ========  ======            ========  ========

                                                      Year Ended
                                                   December 31,2000
                                                   ----------------
                                             Average/    Income/  Yield/
                                              Balance    Expense   Rate
                                              -------    -------   ----
Interest earning assets
   Short-term investments                   $   3,409    $   196    5.75%
   Taxable securities                          16,435      1,116    6.79
   Non-taxable securities                         669         25    3.74
   Loans                                      113,182    $11,139    9.84
                                            ---------    -------
Total interest earning assets               $ 133,695    $12,476    9.33
                                            =========    =======

Interest bearing liabilities
   Interest-bearing demand,
     Money Market and
     Savings Deposits                       $  37,843    $ 1,645    4.35%
   Time deposits                               65,807      4,056    6.16
   Short-term borrowings                        6,791        343    5.05
   Other borrowings                             4,665        303    6.50
                                            ---------    -------
Total interest bearing
   Liabilities                              $ 115,106    $ 6,347    5.51
                                            =========    =======


Dollar amounts in thousands except per share data.

<PAGE>



                                            2002     2001      2000
                                            ----     ----      ----
Average yield on interest-earning
  assets                                    6.57%    8.37%     9.33%
Average rate paid on interest
  -bearing liabilities                      2.84     4.49      5.51
Net interest spread                         3.73     3.88      3.82
Net interest margin (net interest
  earnings divided by average
  total interest-earning assets)            4.06     4.43      4.58
Return on average assets                    (.68)     .29       .54
Return on average equity                   (9.26)    3.95      6.21


INTEREST RATE RISK

The table below  describes  the extent to which  changes in  interest  rates and
changes in volume of interest-earning  assets and  interest-bearing  liabilities
have  affected  Heartland's  interest  income and  expense  during  the  periods
indicated.  For each category of  interest-earning  assets and  interest-bearing
liabilities,  information is provided on changes  attributable to (i) changes in
volume  (change in volume  multiplied by prior year rate),  (ii) changes in rate
(change in rate multiplied by prior year volume) and (iii) total changes in rate
and  volume.  The  combined  effects of changes in both  volume and rate,  which
cannot be separately  identified,  have been  allocated  proportionately  to the
change due to volume and the change due to rate.





                                             Year ended December 31,
                                             -----------------------
                                                  2002 vs. 2001
                                                  -------------

                                                Increase (Decrease)
                                                      due to
                                                      ------
                                            Volume     Rate      Total
                                            ------     ----      -----
Interest income attributable to:
  Loans                                     $  (872)   $(2,226) $(3,098)
  Securities                                   (129)      (215)    (344)
  Other interest-earning assets(1)              165       (160)       5
                                            -------    -------   ------

   Total interest-earning assets               (836)    (2,601)  (3,437)
                                            -------    -------   ------


Interest expense attributable to:
  Money Market and
    Savings Deposits                             96       (909)    (813)
  Time deposits                                (516)    (1,315)  (1,831)
  Short-term borrowings                         (40)      (109)    (149)
  Other borrowings                              246        (44)     202
                                            -------    -------   ------

   Total interest-bearing liabilities          (214)    (2,377)  (2,591)
                                            -------    -------   ------
Increase (decrease) in net interest income  $  (622)   $  (224)  $ (846)
                                            =======    =======   ======

Dollar amounts in thousands except per share data.

<PAGE>


                                             Year ended December 31,
                                             -----------------------
                                                  2001 vs. 2000
                                                  -------------

                                                Increase (Decrease)
                                                      due to
                                                      ------
                                              Volume     Rate    Total
                                              ------     ----    -----
Interest income attributable to:
  Loans                                      $ 2,965   $(1,352)  $1,613
  Securities                                     189       102      291
  Other interest-earning assets(1)               115       (86)      29
                                             -------    ------   ------

   Total interest-earning assets               3,269    (1,336)   1,933
                                             -------   -------   ------

Interest expense attributable to:
  Money Market and
    Savings Deposits                             756      (617)     139
  Time deposits                                  878      (403)     475
  Short-term borrowings                          (29)      (91)    (120)
  Other borrowings                               (27)      (25)     (52)
                                              ------   -------   ------

   Total interest-bearing liabilities          1,578    (1,136)     442
                                              ------   -------   ------

Increase (decrease) in net interest income   $ 1,691   $  (200)  $1,491
                                             =======   =======   ======


(1)   Includes  federal  funds  sold  and  interest-bearing  deposits  in  other
      financial institutions.

LOANS.  Heartland's gross loans, excluding those held for sale, totaled $119,920
at December  31, 2002,  $146,636 at December 31, 2001,  $132,549 at December 31,
2000, $91,045 at December 31, 1999 and $49,442 at December 31, 1998.

The following table sets forth information concerning the composition of
Heartland's  loan portfolio in dollar amounts and percentages as of December 31,
2002, 2001, 2000, 1999 and 1998.


                                     2002                 2001
                                  Percent of            Percent of
                              Amount      Loans      Amount     Loans
                              ------      -----      ------     -----
TYPE OF LOAN
Commercial loans and leases  $ 66,861      55.76%  $  76,097    51.90%
Real estate construction       12,489      10.41      23,150    15.79
Residential mortgages
 (1-4 family homes)            23,952      19.97      24,795    16.91
Consumer                       16,618      13.86      22,594    15.40
                             --------   --------   ---------  -------
Gross loans                  $119,920     100.00%  $ 146,636   100.00%
                             ========   ========   =========  =======

                                     2000                  1999
                                  Percent of            Percent of
                              Amount      Loans      Amount     Loans
                              ------      -----      ------     -----
TYPE OF LOAN
Commercial loans and leases  $ 63,766      48.11%   $ 42,778    46.99%
Real estate construction       24,719      18.65      17,109    18.79
Residential mortgages
 (1-4 family homes)            21,942      16.55      15,069    16.55
Consumer                       22,122      16.69      16,089    17.67
                             --------   --------    --------  -------
Gross loans                  $132,549     100.00%   $ 91,045   100.00%
                             ========   ========    ========  =======

Dollar amounts in thousands except per share data.

<PAGE>



                                    1998
                                 Percent of
                              Amount      Loans
TYPE OF LOAN
Commercial loans and leases   $26,475      53.55%
Real estate construction        7,409      14.99
Residential mortgages
 (1-4 family homes)             6,241      12.62
Consumer                        9,317      18.84
                              -------   --------
Gross loans                   $49,442     100.00%
                              =======   ========



LOAN MATURITY  SCHEDULE.  The following table sets forth certain  information at
December 31, 2002  regarding the dollar amount of loans  maturing in Heartland's
loan  portfolio  based on the date that final payment is due. This schedule does
not reflect the effects of possible  prepayments  or  enforcement of due-on-sale
clauses.  Management  expects  prepayments  will cause actual  maturities  to be
shorter than contractual maturities. Certain mortgage loans such as construction
loans and second  mortgage loans are included in the commercial and  installment
loan totals below.

                                            Remaining  Maturities
                                            One Year   Over one to  Over five
                                 Amount      or less   five years     years
                                 ------      -------   ----------     -----
TYPE OF LOAN

  Commercial loans and leases   $ 66,861     $16,131    $ 7,027     $43,703
  Real estate construction        12,489      10,116        978       1,395
  Residential mortgages
   (1-4 family homes)             23,952           -        632      23,320
  Consumer                        16,618       4,630      8,968       3,020
                                --------     -------    -------     -------
  Total                         $119,920     $30,877    $17,605     $71,438
                                ========     =======    =======     =======

Commercial  loans and leases with remaining  maturities over one year consist of
$10,328 with fixed interest rates and $40,402 with variable  interest  rates, at
December 31, 2002. Real estate construction loans with remaining maturities over
one year  consist of $965 with fixed  interest  rates and $1,408  with  variable
interest rates, at December 31, 2002.

Nonperforming  loans  include  non-accrual  loans and  accruing  loans  that are
contractually past due 90 days or more as to interest or principal payments. The
following  table sets forth certain  information  regarding the dollar amount of
nonperforming loans at December 31.

Nonperforming loans:       2002      2001        2000         1999      1998
                           ----      ----        ----         ----      ----

Non-accrual loans       $  4,857    $  663     $   992     $   138    $     0
Accruing loans past
  due 90 or more days        776        86           0         137          0
                        --------    ------     -------     -------    -------
Total nonperforming
   loans                $  5,633    $  749     $   992     $   275    $     0
                        ========    ======     =======     =======    =======

At December 31, 2002,  non-accrual  loans included  $2,551 in commercial  loans,
$1,072 in real estate  construction  loans,  $1,206 in  residential  real estate
loans and $28 in consumer loans.

Dollar amounts in thousands except per share data.

<PAGE>


ALLOWANCE  FOR LOAN LOSSES.  The Bank  maintains an allowance for loan losses to
provide for probable  incurred losses in the loan portfolio.  Senior  management
reviews  on a monthly  basis the  allowance  for loan  losses as it relates to a
number of  relevant  factors.  The  Board of  Directors  of the  Bank,  not less
frequently  than  quarterly,  reviews  with senior  management  its  recommended
allowance. For more information concerning the factors considered in determining
the adequacy of the  allowance  for loan and lease  losses,  see  "Nonperforming
Assets and  Allowance for Loan Losses"  under the section  headed  "Management's
Discussion  and Analysis of Financial  Condition and Results of  Operations"  of
Heartland's  Annual Report for 2002 attached as Exhibit 13, which  discussion is
incorporated herein by reference.  At December 31, 2002,  Heartland's  allowance
for loan losses totaled $3,498.

The following table provides an allocation of Heartland's allowance for possible
loan losses as of each of the following dates:

                                                At December 31,

                                   2002     2001      2000      1999      1998
                                   ----     ----      ----      ----      ----
   Loan type
     Commercial and leases      $ 2,063   $ 1,466   $ 1,284   $   641   $  397
     Real estate construction       565       789       497       257      111
     Residential mortgages          382       679       441       226       94
     Consumer                       488       466       445       241      140
                                -------   -------   -------   -------   ------

                                $ 3,498   $ 3,400   $ 2,667   $ 1,365   $  742
                                =======   =======   =======   =======   ======


The activity in the allowance  for loan losses for the years ended  December 31,
is as follows:
                               2002       2001       2000     1999       1998
                               ----       ----       ----     ----       ----

   Beginning balance         $ 3,400   $  2,667   $ 1,365   $    742   $    46
   Provision charged
    to operations              3,150      2,967     1,744        656       700
   Loans charged-off          (3,702)    (2,300)     (446)       (34)       (4)
   Recoveries on loans
    previously charged-off       650         66         4          1         -
                             -------   --------   -------   --------   -------

   Ending balance            $ 3,498   $  3,400   $ 2,667   $  1,365   $   742
                             =======   ========   =======   ========   =======


The following table sets forth certain  information  regarding the dollar amount
of charge-offs and recoveries for the years ended December 31:


                               2002       2001       2000     1999       1998
                               ----       ----       ----     ----       ----
Charge-offs by loan type:
   Commercial                $ 2,648   $    997   $   194   $      -   $     -
   Real estate construction      176        927         -          -         -
   Residential mortgages         424         72       147          -         -
   Consumer                      454        304       105         34         4
                             -------   --------   -------   --------   -------

   Total charge-offs         $ 3,702   $  2,300   $   446   $     34   $     4
                             =======   ========   =======   ========   =======

Dollar amounts in thousands except per share data.

<PAGE>

                               2002       2001       2000     1999       1998
                               ----       ----       ----     ----       ----
Recoveries by loan type:
   Commercial                $    82   $     43   $     -   $      -   $     -
   Real estate construction      465          -         -          -         -
   Residential mortgages          11          -         -          -         -
   Consumer                       92         23         4          1         -
                             -------   --------   -------   --------   -------

   Total recoveries          $   650   $     66   $     4   $      1   $     -
                             =======   ========   =======   ========   =======

The following table sets forth certain asset quality ratios at and for the years
ended December 31:

                                 2002      2001       2000     1999      1998
                                 ----      ----       ----     ----      ----

   Allowance for loan losses
    to nonperforming loans       62.1%    453.9%     371.0%   201.0%        -%
   Net charge-offs to
    average loans                 2.3       1.5         .3        -          -
   Provision to average
    loans                         2.3       2.0        1.5       0.9        1.0

SECURITIES.  The following  table sets forth the carrying  value of  Heartland's
investment portfolio as of December 31:

                                                    Gross       Gross
                                        Fair     Unrealized  Unrealized
                                        Value       Gains      Losses
                                        -----       -----      ------
2002
   U.S. Government and its agencies    $ 7,937     $   104     $     -
   Obligations of states and
    political subdivisions               2,709         119           -
   Mortgage backed securities            7,826         212          (2)
   Corporate obligations                 1,094          54           -
                                       -------     -------     -------
                                       $19,566     $   489     $    (2)
                                       =======     =======     =======

                                                    Gross       Gross
                                        Fair     Unrealized  Unrealized
                                        Value       Gains      Losses
                                        -----       -----      ------
2001
   U.S. Government and its agencies    $ 5,381     $    93     $   (12)
   Obligations of states and
    political subdivisions               2,345          15          (2)
   Mortgage backed securities            8,880         130          (8)
   Corporate obligations                   997          32           -
                                       -------     -------     -------
                                      $ 17,603     $   270     $   (22)
                                      ========     =======     =======
Dollar amounts in thousands except per share data.

<PAGE>


The  following  table sets forth the  maturities  of  investment  securities  at
December 31, 2002 and the weighted-average  yield (on a tax equivalent basis) on
such securities.

Fair Values                                 Remaining  Maturities
                                 One Year  Over one to  Over five to Over ten
                                 or less   five years    ten years    years
                                 -------   ----------    ---------    -----
TYPE OF SECURITY

 U.S. Government and its
  agencies                      $      -     $ 7,937    $     -     $     -
 Obligations of states and
   political subdivisions            195         472        857       1,185
 Corporate obligations                 -         550        544           -
 Mortgage-backed securities            -         792      2,110       4,924
                                --------     -------    -------     -------
  Total                         $    195     $ 9,751    $ 3,511     $ 6,109
                                ========     =======    =======     =======

1. Maturity for Mortgage-backed  securities was determined using the contractual
   date of final principal payment.

Weighted Average Yields                     Remaining  Maturities
                                One Year   Over one to  Over five to  Over ten
                                 or less   five years     ten years     years
                                 -------   ----------     ---------     -----
TYPE OF SECURITY

 U.S. Government and its
  agencies                             -%       3.55%         -%          -%
 Obligations of states and
   political subdivisions           5.05        6.54       6.58        7.09
 Corporate obligations              -           5.81       6.24        -
 Mortgage-backed securities         -           2.50       5.02        7.14
  Total                             5.05%       3.71%      5.57%       7.13%

2. Computation of yields is based on amortized cost.

Dollar amounts in thousands except per share data.

<PAGE>


The  following  table sets forth the  amounts  of  Heartland's  interest-earning
assets and interest-bearing  liabilities outstanding at December 31, 2002, which
are scheduled to reprice or mature in each of the time periods shown. The amount
of assets and  liabilities  shown which reprice or mature in a given period were
determined in accordance with the  contractual  terms of the asset or liability.
In addition,  securities  expected to be called by the issuer due to the current
rate  environment  are included in the  categories  based on the  expected  call
dates.  Loans held for sale are included in the categories based on the expected
sale  date.  This  table  does not  necessarily  indicate  the impact of general
interest rate movements on Heartland's net interest income because the repricing
of certain  categories of assets and liabilities is subject to the interest rate
environment,  competition  and other factors beyond  Heartland's  control.  As a
result,  certain  assets  and  liabilities  may in fact  mature  or  reprice  at
different times and in different volumes than indicated.

<TABLE>
<CAPTION>
                              Within 3    4 - 12      1 - 5        Over 5
                               Months     Months      years         years      Total
                               ------     ------      -----         -----      -----
Interest-earning assets:
<S>                          <C>        <C>         <C>           <C>         <C>
  Federal funds sold         $ 15,034   $      -    $      -      $      -    $15,034
  Time deposits with other
    Financial institutions          -        500           -             -        500
  Securities                    1,970      6,965        7,117        3,514     19,566
  Loans held for sale           7,156          -            -            -      7,156
  Loans                        38,254     23,864       36,347       21,455    119,920
  FHLB stock                      608          -            -            -        608
                             ---------  --------    ---------     --------  ---------

   Total interest-earning
                                   --         --           --
      assets                   63,022     31,329       43,464       24,969    162,784
                             --------   ---------   ---------     --------  ---------

Interest-bearing
liabilities:
  Interest bearing
   demand     and savings      60,408          -            -           -      60,408
   deposits
  Time deposits                21,891     32,337       15,221           -      69,449
  Repurchase Agreements         6,251          -            -           -       6,251
  Other borrowings                  -      3,000        1,000           -       4,000
  Subordinated debentures       5,000          -            -           -       5,000
                             --------   --------     --------     -------    --------

   Total interest-bearing
   liabilities                 93,550     35,337       16,221           -     145,108
                             --------   --------     --------     -------    --------

Interest-earning assets
  less Interest-bearing
   liabilities               $(30,528) $  (4,008)    $ 27,243    $ 24,969    $ 17,676
                             ========  =========     ========    ========    ========


Cumulative interest-rate
sensitivity gap              $(30,528) $ (34,536)    $ (7,293)   $ 17,676
                             ========  =========     ========    ========

Cumulative interest-rate
  gap as a percentage of
  total interest earning
  assets                        (18.8)%    (21.2)%       (4.5)%      10.9%
                              =======   =========     ========     =======

</TABLE>

Dollar amounts in thousands except per share data.

<PAGE>


CERTIFICATES OF DEPOSIT.  The following table presents the amount of Heartland's
jumbo  certificates of deposit with principal  balances greater than $100 by the
time remaining until maturity as of December 31, 2002:

                                                  At December 31,
               Maturity                                2002
               --------                                ----

               Three months or less                $   13,056
               Over 3 months to 6 months                4,285
               Over 6 months to 12 months               5,371
               Over 12 months                           3,706
                                                   ----------

                  Total                            $   26,418
                                                   ==========


SHORT-TERM   BORROWINGS.   The  following  table  presents  certain  information
pertaining to Heartland's repurchase agreements:

                                                 2002         2001
                                                 ----         ----

Balance outstanding at December 31             $ 6,251     $ 5,554

Maximum amount outstanding at any month-end    $ 7,364     $10,201

Average balance outstanding                    $ 4,855     $ 5,797

Weighted average rate                             1.52%       3.54%



ITEM 2.  DESCRIPTION OF PROPERTY

Heartland  owns its home office at 420 North Morton Street,  Franklin,  Indiana.
The facility is used as the main banking  office and  Heartland's  headquarters.
The 5,700 square foot  building was  constructed  prior to 1970 and underwent an
extensive renovation in 1997 prior to the opening of Heartland.

The Bank leases two branch offices in Greenwood,  Indiana, and the land on which
the branch office in Bargersville, Indiana stands. The Bank also leases a 12,500
square foot facility that was constructed in 2001 in Franklin,  Indiana for loan
production and loan and deposit operations, not as a branch facility.

Heartland  and the Bank  presently  do not invest in real estate other than real
estate acquired for purposes of operations and mortgage interests in real estate
securing loans made by the Bank in the ordinary course of business. The Board of
Directors of the Bank from time to time specifies its policies as to the amounts
and types of mortgage  loans that the Bank may  originate or acquire,  and these
policies may be changed without action by Heartland shareholders. Mortgage loans
are made for interest income purposes, not for capital gain.

Dollar amounts in thousands except per share data.


<PAGE>


ITEM 3.  LEGAL PROCEEDINGS

Other than routine litigation incidental to the business, and the May 2002 Order
that is  described  under Item 1,  "BUSINESS  --REGULATION  AND  SUPERVISION  OF
HEARTLAND AND THE BANK" (which description is incorporated herein by reference),
Heartland and the Bank are not involved in any legal proceedings.


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

No matter was submitted to a vote of security  holders through the  solicitation
of proxies or otherwise, during the quarter ended December 31, 2002.



<PAGE>






                                     PART II

Item 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Information  required  for this item is included in the section  headed  "COMMON
STOCK." in Exhibit 13 (the  Registrant's  Annual Report to Shareholders  for the
year  ended  December  31,  2002),  which  section  is  incorporated  herein  by
reference.  The description of legal and regulatory  restrictions that limit the
ability  of  the  Bank  to pay  dividends  to  Heartland,  and  which  therefore
indirectly limit the ability of Heartland to pay dividends to its  shareholders,
that is included in Item 1 of this report,  Description  of Business,  under the
caption  "Regulation and  Supervision of the Bank",  is  incorporated  herein by
reference.


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

Information   required  for  this  item  is  included  in  the  section   headed
"MANAGEMENT'S  DISCUSSION  AND  ANALYSIS OF FINANCIAL  CONDITION  AND RESULTS OF
OPERATIONS." in Exhibit 13 (the  Registrant's  Annual Report to Shareholders for
the year ended  December 31,  2002),  which  section is  incorporated  herein by
reference.


ITEM 7.  FINANCIAL STATEMENTS.

Exhibit 13 (the  Registrant's  Annual Report to Shareholders  for the year ended
December 31, 2002) includes  (following the page headed "FINANCIAL  STATEMENTS")
the following  items (each of which is  incorporated  herein by reference to the
appropriate pages of Exhibit 13):

o  Report of Independent Auditors on consolidated financial statements.

o  Consolidated Balance Sheets at December 31, 2002 and 2001.

o  Consolidated  Statements of Income for the years ended  December 31, 2002 and
   2001.

o  Consolidated  Statements  of  Changes in  Shareholders'  Equity for the years
   ended December 31, 2002 and 2001.

o  Consolidated  Statements of Cash Flows for the years ended  December 31, 2002
   and 2001.

o  Notes to consolidated financial statements.


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

None



<PAGE>


                                    PART III

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

Information  relating  to  directors  and  executive  officers of  Heartland  is
included in the section headed "Election of Directors" in Exhibit 99.1, the 2003
Proxy Statement of Heartland, which section is incorporated herein by reference.
Addition  information  relating  to  non-director  executive  officers is listed
below. The position and principal  occupation of each of such executive officers
has been the same for at least the last five years, except as indicated below.

Executive Officers:

John M. Morin
Senior Vice President, Consumer Lending, of the Bank
Age 53

R. Trent McWilliams
Vice President, Business Development of the Bank
Age 51

Jeff Joyce
Vice President and Chief Financial Officer of Heartland and the Bank
Age 32

Eric Johnson1
Chief Credit Officer of the Bank
Age 53

1 Prior to becoming  Chief Credit Officer of the Bank in April 2002, Mr. Johnson
  served  in  various  positions  at  Michigan  National  Bank,  NA from 1991 to
  November 2001, most recently as Vice President and Commercial Loan officer.

Section 16(a) Compliance:

Heartland has no class of equity securities registered with the Commission under
Section 12 of the Securities Exchange Act of 1934, as amended, and Section 16(a)
is therefore inapplicable to its securities.


ITEM 10.   EXECUTIVE COMPENSATION

Information  relating to  compensation  of  Heartland's  executive  officers and
Directors is included under the captions "Executive  Compensation" and "Election
of  Directors  Compensation  of  Directors"  in  Exhibit  99.1,  the 2003  Proxy
Statement of Heartland, which sections are incorporated herein by reference.





<PAGE>


ITEM 11.  SECURITY  OWNERSHIP OF CERTAIN  BENEFICIAL  OWNERS AND  MANAGEMENT AND
          RELATED STOCKHOLDER MATTERS

Information  required by this item  regarding  beneficial  ownership  of certain
persons is included  under the captions  "ELECTION OF DIRECTORS"  and "PRINCIPAL
OWNERS OF COMMON SHARES" in Exhibit 99.1, the 2003 Proxy Statement of Heartland,
which  section is  incorporated  herein by  reference.  In tabular  format,  the
information  required by Item 403 of Regulation  S-B with respect to persons who
are known  (based  solely upon  information  publicly  filed by such  beneficial
owners  with  the  Securities  and  Exchange  Commission  in  certain  documents
described  below)  to  Heartland  to be the  beneficial  owner of more than five
percent of Heartland's common shares is as follows:

                      Name and                 Amount and
  Title of     Address of Beneficial      Nature of Beneficial      Percent of
    Class              Owner                    Ownership              Class
    -----              -----                    ---------              -----

Common         Hot Creek Investors, LP          109,300                7.8%
               PO Box 3178
               Gardnerville, NV  89410

Common         Hot Creek Capital, LLC           109,300                7.8%
               PO Box 3178
               Gardnerville, NV  89410

Common         David M. W. Harvey               109,300                7.8%
               PO Box 3178
               Gardnerville, NV  89410

Common         Riggs Partners, LLC               98,353                7.05%
               3045 Central Avenue
               Wester Springs, IL  30538

Common         Philip Timyan                     98,353                7.05%
               3045 Central Avenue
               Wester Springs, IL  30538


According to a Schedule 13G amendment  filed as of January 28, 2003 by Hot Creek
Investors,  LP, Hot Creek  Capital,  LLC and David M. W. Harvey,  all securities
beneficially owned by them were held by Hot Creek Investors, L.P. ("Hot Creek").
Hot Creek  Capital,  LLC and David M. W. Harvey stated that they were joining in
the Schedule 13G because they  exercised  voting and  investment  power over the
shares held by Hot Creek.  According  to a Schedule  13D  amendment  filed as of
December 18, 2002 by Riggs  Partners,  LLC, and Philip  Timyan,  all  securities
beneficially  owned by them were held by Riggs Partners,  LLC ("Riggs").  Philip
Timyan  stated that he was  joining in the  Schedule  13D  because he  exercised
voting and investment power over the shares held by Riggs.

Equity Compensation Plan Information

At December 31, 2002, the Company  maintained two stock option plans under which
it  has   authorized  the  issuance  of  its  Common  Shares  to  employees  and
non-employee directors as compensation:  its 1997 employee plan (under which new
options may be granted  through  2007) and its 1997  non-employee  director plan
(under which no new options may be granted  after  September  2002 and which was
supplemented in January 2003 with a new nonemployee  director plan). Each of the
plans in effect at December 31, 2002,  was approved by the requisite vote of the
Company's  common  shareholders  in 1997 prior to the Company's  initial  public
offering  of its common  shares.  Each of these plans was amended in 1999 by the
Board of  Directors  to  increase  the  number of common  shares  available  for
issuance under those plans; the amendment of the employee plan was submitted for
approval by  shareholders  and was so approved by the  requisite  vote,  and the
amendment of the nonemployee director plan was not submitted for approval by the
shareholders.  At  December  31,  2002,  the  Company  was  not a  party  to any
individual compensation  arrangement involving the authorization for issuance of
its equity securities to any single person, other than option agreements granted
under the terms of one of the two option plans  identified  above. The following
table sets forth information regarding these plans as of December 31, 2002:
                                                                   Number of
                                                                   Securities
                                                                   Remaining
                                   Number of                     Available for
                                   Securities      Weighted     Future Issuance
                                  to be Issued      Average       under Equity
                                 upon Exercise  Exercise Price    Compensation
                                       of             of             Plans
                                  Outstanding     Outstanding      (Excluding
                                    Options,       Options,        Securities
                                  Warrants or    Warrants and     Reflected in
         Plan Category               Rights         Rights       First Column)
         -------------               ------         ------       -------------
Equity compensation plans
approved by
security holders                    127,044          $9.07           20,804
Equity compensation plans not
approved
by security holders                   8,000           9.07                -
                                    -------                          ------
Total                               135,044          $9.07           20,804



ITEM 12.   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Information  required  by this item is  included  under the  caption  "EXECUTIVE
COMPENSATION -- CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS" in Exhibit 99.1,
the 2003 Proxy Statement of Heartland,  which section is incorporated  herein by
reference.




<PAGE>


ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K.

Exhibit No.     Description

3.1   Amended and Restated  Articles of Incorporation  of Heartland  Bancshares,
      Inc.,   which  are  incorporated  by  reference  to  Exhibit  3.1  in  the
      Registration Statement Form SB-2, filed July 28, 1997, as amended,  ("Form
      SB-2").
3.2   Amended and  Restated  Bylaws of  Heartland  Bancshares,  Inc.,  which are
      incorporated by reference to Exhibit 3.2 in the Form SB-2.
4.1   Rights Agreement dated as of June 23, 2000 between  Heartland  Bancshares,
      Inc., and Heartland  Community  Bank, as Rights Agent,  is incorporated by
      reference to Exhibit 4.01 to Form 8-K filed June 30, 2000.
4.2   Terms of Common  Shares and  Preferred  Shares are included in the Amended
      and Restated  Articles of  Incorporation  of Heartland  Bancshares,  Inc.,
      which are  incorporated  by reference  to Exhibit 3.1 to the  Registration
      Statement on Form SB-2, filed July 28, 1997, as amended.
4.3   Terms of  Series A  Preferred  Shares  are  included  in the  Articles  of
      Amendment of Articles of Incorporation of Heartland  Bancshares,  Inc., as
      filed with the  Indiana  Secretary  of State on June 27,  2000,  which are
      incorporated by reference to Exhibit 3.01 to Form 8-K filed June 30, 2000.
10.1  1997 Stock Option Plan, as amended,  which is incorporated by reference to
      Exhibit  10.1 in the  Issuer's  Quarterly  Report on the Form  10-QSB  for
      quarter ended June 30, 1999.
10.2  1997 Stock Option Plan for  Nonemployee  Directors,  as amended,  which is
      incorporated by reference to Exhibit 10.1 in the Issuer's Quarterly Report
      on the Form 10-QSB for quarter ended June 30, 1999.
10.3  Deferred  Compensation  Master  Plan  Agreement  dated as of July 1, 2001,
      which is  incorporated  by reference  to Exhibit 10.3 in the  Registrant's
      Annual Report on the Form 10-KSB for year ended December 31, 2001.
10.4  Split  Dollar  Endorsement  Agreement  dated as of January 1, 2001 between
      Heartland  Community Bank and Steven L. Bechman,  which is incorporated by
      reference to Exhibit 10.4 in the  Registrant's  Annual  Report on the Form
      10-KSB for year ended December 31, 2001.
10.5  2003 Stock Option Plan for Nonemployee Directors.
10.6  Split  Dollar  Endorsement  Agreement  dated as of January 1, 2001
      between  Heartland Community Bank and Jeffrey L. Goben.
13    The Issuer's Annual Report to Shareholders for the year ended December 31,
      2002.  As  permitted  by  paragraph  (b)  under  Supplemental  Information
      requirements  applicable to Section 15(d) filers, and except to the extent
      specifically  incorporated herein by reference,  the Issuer disclaims that
      this exhibit is "filed" or subject to the liabilities of Section 18 of the
      Exchange Act or other liabilities.
21    Subsidiaries of the Issuer and names under which the Issuer is doing
      business
99.1  The Issuer's  2003 Proxy  Statement.  As  permitted by paragraph  (b)
      under Supplemental Information requirements applicable to Section 15(d)
      filers, and except to the  extent  specifically  incorporated  herein by
      reference,  the Issuer disclaims  that this exhibit is "filed" or subject
      to the  liabilities  of Section 18 of the Exchange Act or other
      liabilities.
99.2  Form of Proxy for 2003 Annual Meeting. As permitted by paragraph (b) under
      Supplemental  Information requirements applicable to Section 15(d) filers,
      and except to the extent  specifically  incorporated  herein by reference,
      the  Registrant  disclaims  that this exhibit is "filed" or subject to the
      liabilities of Section 18 of the Exchange Act or other liabilities.
99.3  Certification by the Chief Executive Officer.
99.4  Certification by the Chief Financial Officer.



<PAGE>


Reports on Form 8-K

No report on Form 8-K was filed during the three months ended December 31, 2002.

ITEM 14.  CONTROLS AND PROCEDURES.


Within  90 days  prior  to the date of this  report,  Heartland  carried  out an
evaluation,  under the supervision and with the  participation  of its principal
executive officer and principal  financial officer,  of the effectiveness of the
design and operation of its disclosure  controls and  procedures.  Based on this
evaluation,  Heartland's  principal  executive  officer and principal  financial
officer  concluded  that  Heartland's  disclosure  controls and  procedures  are
effective  in  timely  alerting  them to  material  information  required  to be
included in Heartland's  periodic reports filed with the Securities and Exchange
Commission.  It should be noted  that the design of any  system of  controls  is
based in part upon certain  assumptions  about the  likelihood of future events,
and there can be no  assurance  that any design will  succeed in  achieving  its
stated goals under all  potential  future  conditions.  In  addition,  Heartland
reviewed its internal  controls,  and there have been no significant  changes in
Heartland's  internal  controls  or in other  factors  that could  significantly
affect those  controls  subsequent  to the date of its last  evaluation  of such
controls.





<PAGE>


SIGNATURES

Pursuant to the requirements of Section 15(d) of the Securities  Exchange Act of
1934,  Heartland  has duly  caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, this 28th day of March, 2003.

HEARTLAND BANCSHARES, INC.

By:/s/ Steven L. Bechman
   ---------------------------------
Steven L. Bechman,
Chief Executive Officer and President

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

Signatures and Title(s) Date

/s/ Steven L. Bechman   March 28, 2003
- -----------------------------
Steven L. Bechman, Director
(principal executive officer)

/s/ Gordon Dunn         March 28, 2003
- -----------------------------
Gordon Dunn, Director (Chairman of the Board)

/s/ Sharon Acton        March 28, 2003
- -----------------------------
Sharon Acton, Director

/s/ Jeffrey L. Goben    March 28, 2003
- -----------------------------
Jeffrey L. Goben, Director

/s/ J. Michael Jarvis   March 28, 2003
- -----------------------------
J. Michael Jarvis, Director

/s/ John Norton         March 28, 2003
- -----------------------------
John Norton, Director

/s/ Robert Richardson   March 28, 2003
- -----------------------------
Robert Richardson, Director

/s/ Patrick A. Sherman  March 28, 2003
- -----------------------------
Patrick A. Sherman, Director

/s/ Jeffery D. Joyce    March 28, 2003
- -----------------------------
Jeffery D. Joyce, Chief Financial Officer
(principal financial and accounting officer)


<PAGE>


                  CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

I, Steven L. Bechman, certify that:

1. I have reviewed this annual report on Form 10-KSB of Heartland Bancshares,
   Inc.;

2. Based on my  knowledge,  this  annual  report  does not  contain  any  untrue
   statement of a material  fact or omit to state a material  fact  necessary to
   make the  statements  made,  in light of the  circumstances  under which such
   statements  were made, not  misleading  with respect to the period covered by
   this annual report;

3. Based  on  my  knowledge,  the  financial  statements,  and  other  financial
   information  included in this annual  report,  fairly present in all material
   respects the financial condition, results of operations and cash flows of the
   registrant as of, and for, the periods presented in this annual report;

4. The  registrant's  other  certifying  officers  and  I  are  responsible  for
   establishing and maintaining  disclosure  controls and procedures (as defined
   in Exchange of Act Rules 13a-14 and 15d-14) for the registrant and we have:
   a)  designed such disclosure  controls and procedures to ensure that material
       information  relating  to  the  registrant,  including  its  consolidated
       subsidiaries,  is made  known  to us by  others  within  those  entities,
       particularly  during  the  period in which  this  annual  report is being
       prepared;
   b)  evaluated the effectiveness of the registrant's  disclosure  controls and
       procedures  as of a date within 90 days prior to the filling date of this
       annual report (the "Evaluation Date"); and
   c)  presented  in this  annual  report  our  conclusions  about the
       effectiveness  of the disclosure  controls and  procedures  based on our
       evaluation  as of the  Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
   most recent evaluation,  to the registrant's auditors and the audit committee
   of  registrant's  board of directors (or persons  performing  the  equivalent
   function):

   a) all significant  deficiencies in design or operation of internal  controls
   which could adversely  affect the  registrant's  ability to record,  process,
   summarize and report  financial data and have identified for the registrant's
   auditors  any material  weaknesses  in internal  controls;  and b) any fraud,
   whether or not material, that involves management or other employees who have
   a significant role in the registrant's internal controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
   annual  report  whether or not there  were  significant  changes in  internal
   controls  or in  other  factors  that  could  significantly  affect  internal
   controls subsequent to the date of our most recent evaluation,  including any
   corrective  actions  with regard to  significant  deficiencies  and  material
   weaknesses.

Date:03/28/2003
     ----------
_/s/ Steven L. Bechman
Steven L. Bechman, Chief Executive Officer


<PAGE>


                  CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

I, Jeffery D. Joyce, certify that:


1. I have reviewed this annual report on Form 10-KSB of Heartland Bancshares,
   Inc.;

2. Based on my  knowledge,  this  annual  report  does not  contain  any  untrue
   statement of a material  fact or omit to state a material  fact  necessary to
   make the  statements  made,  in light of the  circumstances  under which such
   statements  were made, not  misleading  with respect to the period covered by
   this annual report;

3. Based  on  my  knowledge,  the  financial  statements,  and  other  financial
   information  included in this annual  report,  fairly present in all material
   respects the financial condition, results of operations and cash flows of the
   registrant as of, and for, the periods presented in this annual report;

4. The  registrant's  other  certifying  officers  and  I  are  responsible  for
   establishing and maintaining  disclosure  controls and procedures (as defined
   in Exchange of Act Rules 13a-14 and 15d-14) for the registrant and we have:
   a)  designed such disclosure  controls and procedures to ensure that material
       information  relating  to  the  registrant,  including  its  consolidated
       subsidiaries,  is made  known  to us by  others  within  those  entities,
       particularly  during  the  period in which  this  annual  report is being
       prepared;
   b)  evaluated the effectiveness of the registrant's  disclosure  controls and
       procedures  as of a date within 90 days prior to the filling date of this
       annual report (the "Evaluation Date"); and
   c)  presented  in this  annual  report  our  conclusions  about the
       effectiveness  of the disclosure  controls and  procedures  based on our
       evaluation  as of the  Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
   most recent evaluation,  to the registrant's auditors and the audit committee
   of  registrant's  board of directors (or persons  performing  the  equivalent
   function):

   a) all significant  deficiencies in design or operation of internal  controls
   which could adversely  affect the  registrant's  ability to record,  process,
   summarize and report  financial data and have identified for the registrant's
   auditors  any material  weaknesses  in internal  controls;  and b) any fraud,
   whether or not material, that involves management or other employees who have
   a significant role in the registrant's internal controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
   annual  report  whether or not there  were  significant  changes in  internal
   controls  or in  other  factors  that  could  significantly  affect  internal
   controls subsequent to the date of our most recent evaluation,  including any
   corrective  actions  with regard to  significant  deficiencies  and  material
   weaknesses.

Date:03/28/2003
     ----------

_/s/ Jeffery D. Joyce
Jeffery D. Joyce, Chief Financial Officer