EXHIBIT 13
<PAGE>


                           Landmark Bancshares, Inc.

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CONTENTS
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Message to our Stockholders ...........................................1


Corporate Profile and Stock Price Information .........................3


Five-Year Financial Summary ...........................................4


Management's Discussion and Analysis ..................................6


Report of Independent Accountants ...................................F-1


Consolidated Financial Statements ...................................F-2


Notes to Consolidated Financial Statements ..........................F-7


Corporate Information ................................................20



<PAGE>


MESSAGE TO OUR STOCKHOLDERS:

I am pleased to report to you fiscal year 1998  progress,  accomplishments,  and
the financial condition of Landmark Bancshares,  Inc. in this, our fifth, annual
report since becoming a public company in March 1994.

As we approach the new  millenium,  we continue to become more  bank-like in the
way we operate our wholly-owned  subsidiary,  Landmark Federal Savings Bank, and
the services we offer our customers. Over the past twelve months, our commercial
loan  department  has become fully  operational  and a new full  service  branch
facility  with three  drive  through  lanes and a drive up ATM has been  opened.
Furthermore,  24 hour ATMs were  installed  at our Great  Bend and  Garden  City
offices in the spring,  and we have begun to offer  CheckCards  to our  customer
base.

The core  business  during  fiscal  year  1998  continued  to focus on  mortgage
lending.  Loans  receivable and loans held for sale increased  $16.57 million or
10.48%,  to $174.73  million  at  September  30,  1998 from  $158.16  million at
September 30, 1997.  This increase is a result of a larger number of residential
mortgage loans,  attributable  to our new Kansas City  origination  office,  our
mortgage broker program, rural development loans, and the efforts of our lending
personnel  to dominate  the markets in which we offer our  products.  As we move
forward, we will continue to provide home financing to our communities, focusing
on prudent  underwriting  standards that will result in a high quality  mortgage
loan portfolio with moderate risk. To a lesser extent but no less important, was
the  growth in  consumer  loans,  new auto  leasing  loans,  and small  business
lending.

Our core  business  in fiscal  1998  included  significant  growth  in  deposits
attributable  to aggressive  bidding for municipal  funds and excellent  service
provided  by  our  customer  service  representatives  to  our  savers.  Deposit
liabilities  increased  $10.05 million to $154.79 million at September 30, 1998,
from $144.74 million at September 30, 1997.

Net earnings for the year was $2.36  million or $1.56 basic  earnings per share,
compared to $1.52 basic earnings per share in fiscal 1997.

Total assets decreased  slightly to $225.37 million from $227.85 million for the
year prior, due mainly to reducing investment  securities  held-to-maturity  and
mortgage  backed  securities,  which was partially  offset by the increased loan
receivables.  It has been the strategy of the Board of Directors and  Management
to grow the loan portfolio, which has a higher yield to the Bank than investment
and mortgage-backed securities.

The Board of Directors and the management have  established a formal process for
the  implementation of a plan to evaluate and correct the problems that the year
2000,  commonly  known as Y2K,  could  cause the  Company's  critical  automated
systems. A committee known as

                                       -1-
<PAGE>

Vision 2000, made up of officers and supervisory personnel of the Bank, have met
regularly  over the past year to address such matters.  Management is continuing
to work closely with its main data processor, as well as other vendors,  service
providers,  and regulators to accomplish its goal of a smooth  transition to the
year 2000.

The  Board  of  Directors  continued  their  policy  of  paying  quarterly  cash
dividends,  and in fact,  increased  the dividend from $0.10 per share in May to
$0.15 per share in August.  A special $0.10 dividend was declared at the regular
January 1998 board meeting.

Stock  repurchases  are another  element of our  shareholder  value  enhancement
strategy.  Due to the recent downturn in bank and thrift stocks, the Corporation
was able to buy back 212,429  shares of stock within a thirty-day  period ending
September 30, 1998.  At fiscal year end a total of 953,378  shares or 41% of the
original shares issued had been repurchased.

On behalf of the Board of Directors, I wish to thank our stockholders, customers
and dedicated staff for your continued support of Landmark Bancshares, Inc.

Personal Regards, 

/s/Larry Schugart
-------------------------------------
Larry Schugart
President and 
Chief Executive Officer


                                       -2-
<PAGE>
================================================================================
Corporate Profile and Related Information

Landmark  Bancshares,  Inc. (the  "Company") is the parent  company for Landmark
Federal  Savings  Bank  (the  "Bank").  The  Company  was  formed  as  a  Kansas
corporation in November 1993 at the direction of the Bank in connection with the
Bank's  conversion from a mutual to stock form of ownership (the  "Conversion").
The  Company  acquired  all of the  capital  stock that the Bank issued upon its
conversion.  On March 28, 1994,  the Bank completed its conversion in connection
with a $22.8 million initial public  offering.  The Company is a unitary savings
and loan holding company which, under existing laws, generally is not restricted
in the types of business  activities  in which it may engage  provided  that the
Bank retains a specified amount of its assets in housing-related investments. At
the present time,  since the Company does not conduct any active  business,  the
Company does not intend to employ any persons  other than  officers but utilizes
the support staff and facilities of the Bank from time to time.

Landmark  Federal  Savings  Bank is a federally  chartered  stock  savings  bank
headquartered in Dodge City, Kansas. The Bank was founded in 1920 with a charter
from Kansas  under the name of "Dodge City Savings and Loan  Association"  which
later became a federal  association under the name of "First Federal Savings and
Loan of Dodge City." First  Federal  Savings and Loan of Dodge City became known
as "Landmark  Federal  Savings  Association" in 1983 when it changed its name at
the time it merged with Peoples Savings and Loan of Sterling, Kansas. The Bank's
deposits have been federally insured since 1943 and are currently insured by the
Federal Deposit Insurance Corporation (the "FDIC") under the Savings Association
Insurance Fund (the "SAIF"). The Bank conducts its business from its main office
in Dodge City,  Kansas and five branch offices located in Barton,  Finney,  Ford
and Rush Counties in Kansas. The Bank also has a loan origination office located
in Overland Park, Kansas.

Stock Market Information

There were 1,327,934  shares (net of treasury stock) of common stock of Landmark
Bancshares,  Inc.  outstanding on September 30, 1998, held by approximately  263
stockholders of record (not including the number of persons or entities  holding
the stock in nominee or street name through various brokerage firms).  Since its
issuance in March 1994, the Company's common stock has been traded on the Nasdaq
National  Market.  The daily stock  quotation for Landmark  Bancshares,  Inc. is
listed in the  Nasdaq  National  Market  section  published  in The Wall  Street
Journal and other leading  newspapers  under the trading  symbol of "LARK".  The
following table reflects stock price  information based on sales as published by
the Nasdaq National Market  statistical report for each quarter for fiscal years
1998 and 1997.
<TABLE>
<CAPTION>
                                                Year Ended September 30,
                              -------------------------------------------------------------
                                          1998                                 1997
                              -----------------------------  ------------------------------

                                  HIGH            LOW            HIGH             LOW
                              -------------- --------------  --------------  --------------
<S>                                <C>            <C>            <C>              <C>
First Quarter                        26 1/2         23             18 3/4           16
Second Quarter                       26             22             20               18
Third Quarter                        29 1/4         24 3/4         20 1/8           18 3/4
Fourth Quarter                       26 4/5         20 1/4         27 5/8           20 1/4

</TABLE>

The following  table sets forth,  for each quarter the dividends paid or payable
on the common stock for the  indicated  fiscal years  ending  September  30. The
Company's ability to pay dividends to shareholders is largely dependent upon the
dividends  it  receives  from  the  Bank.  The  Bank is  subject  to  regulatory
limitations on the amount of cash dividends it may pay.
<TABLE>
<CAPTION>
                                         Year Ended September 30,
                           -----------------------------------------------
Dividends per share                    1998                    1997
                           ----------------------   ----------------------
<S>                               <C>                         <C>  
First Quarter                     $0.10                       $0.10
Second Quarter                     0.20                        0.10
Third Quarter                      0.15                        0.10
Fourth Quarter                     0.15                        0.10
</TABLE>

On October 21,  1998 the Board of  Directors  declared a  quarterly  dividend of
$0.15 per share to shareholders of record on November 2, 1998.

                                       -3-
<PAGE>

<TABLE>
<CAPTION>
================================================================================
FIVE-YEAR FINANCIAL SUMMARY
Selected Financial Condition Data (Dollars in Thousands)
==============================================================================================================================  
At September 30,                                 1998             1997              1996             1995              1994
------------------------------------------------------------------------------------------------------------------------------
<S>                                          <C>              <C>               <C>              <C>               <C>     
Total assets                                   $225,368         $227,850          $213,734         $208,632          $188,727
Loans receivable, net (1)                       174,733          158,163           129,903           98,934            71,253
Investments held-to-maturity                     11,575           18,838            29,399           34,825            39,922
Investments available-for-sale                    9,221            7,123             4,138            1,693             1,743
Mortgaged-backed securities               
   held-to-maturity                              21,724           36,690            45,877           68,207            70,470
Cash and cash equivalents                         2,844            2,741               474              462             1,061
Deposits                                        154,793          144,735           143,815          144,957           136,858
FHLB borrowings                                  41,700           46,200            33,467           25,533            13,580
Stockholders' equity                             25,024           32,245            32,389           34,667            36,606
</TABLE>                        

<TABLE>
<CAPTION>
Summary of Operations (Dollars in Thousands)
------------------------------------------------------------------------------------------------------------------------------
Year Ended September 30,                           1998             1997              1996             1995              1994
------------------------------------------------------------------------------------------------------------------------------
<S>                                           <C>              <C>               <C>              <C>               <C>    
Interest income                                 $17,207          $16,695           $14,575          $13,652           $10,671
Interest expense                                 10,216            9,768             8,678            8,224             5,917
                                            ----------------------------------------------------------------------------------

  Net interest income                             6,991            6,927             5,897            5,428             4,754
Provision for loan losses                           265              308               135                9               (85)
Provision for losses on corporate
  securities and municipal obligations                0                0                 0                0              (128)
                                            ----------------------------------------------------------------------------------

  Net interest income after provision
   for losses on loans and investments            6,726            6,619             5,762            5,419             4,967
Non-interest income                               1,226            1,026               745              684               450
Non-interest expense (2)                          4,134            3,581             4,323            3,315             2,907
                                            ----------------------------------------------------------------------------------

Income before income taxes                        3,818            4,064             2,184            2,788             2,510
Provision for income taxes                        1,454            1,550               780            1,025               926
                                            ----------------------------------------------------------------------------------

Net income                                       $2,364           $2,514            $1,404           $1,763            $1,584
                                            ==================================================================================

Basic earnings per share (3)                      $1.56            $1.52             $0.78            $0.87             $0.42
                                            ==================================================================================
Diluted earnings per share (3)                    $1.42            $1.42             $0.74            $0.85             $0.42
                                            ==================================================================================
Dividends per share (3)                           $0.60            $0.40             $0.40            $0.75             $0.05
                                            ==================================================================================
Book value per common share
   outstanding at September 30                   $18.84           $19.10            $17.48           $16.62            $16.05
                                            ==================================================================================
</TABLE>

(1)  Includes loans held for sale totaling $2,409,  $490, $1,890,  $317 and $611
     at September 30, 1998, 1997, 1996, 1995 and 1994, respectively.
(2)  Includes  one-time  SAIF  special  assessment  of $973 for the  year  ended
     September 30, 1996.
(3)  For  periods  following  conversion  from mutual to stock on March 28, 1994
     (1994 - March 28 through September 30).


                                       -4-
<PAGE>
<TABLE>
<CAPTION>
================================================================================
FIVE-YEAR FINANCIAL SUMMARY
Selected Ratios and Other Data
=====================================================================================================================
At or For the Year Ended September 30,                  1998        1997          1996         1995          1994
---------------------------------------------------------------------------------------------------------------------
<S>                                                   <C>         <C>           <C>          <C>           <C>   
Return on average assets                                1.03  %     1.12  %       0.70  %      0.88  %       0.90  %
Return on average equity                                7.52        7.79          4.14         4.92          6.06
Average equity to average assets                       13.71       14.44         17.00        17.88         14.93
Equity to assets at period end                         11.10       14.15         15.15        16.62         19.40
Net interest spread                                     2.41        2.41          2.11         1.88          2.18
Net yield on average interest-earning assets            3.12        3.16          3.01         2.76          2.77
Non-performing assets to total assets                   0.34        0.30          0.15         0.22          0.22
Non-performing loans to net loans                       0.39        0.27          0.24         0.39          0.29
Allowance for loan losses to total loans                0.65        0.61          0.57         0.65          0.87
Dividend payout                                        39.31       26.95         53.58        90.93         13.02
Number of:
  Loans outstanding                                    6,741       6,210         5,439        4,561         3,859
  Deposit accounts                                    12,878      12,888        13,443       13,731        12,582
  Full service offices                                     6           5             5            5             5
</TABLE>



                            [FOUR GRAPHICS OMITTED]

                                       -5-
<PAGE>


================================================================================

Management's Discussion and Analysis
of Financial Condition and Results of Operations

Landmark Bancshares, Inc.

The  following  is a  discussion  of the  financial  condition  and  results  of
operations of the Company and its subsidiary, Landmark Federal Savings Bank (the
"Bank"),  and should be read in conjunction with the  accompanying  Consolidated
Financial Statements.

General

The Bank is primarily  engaged in the business of  attracting  deposits from the
general public and using those deposits, together with other funds, to originate
mortgage  loans for the  purchase  and  refinancing  of  residential  properties
located in central and southwestern  Kansas.  In addition,  the Bank also offers
and purchases loans through correspondent lending relationships in Kansas and in
other  states.  The Bank also makes  commercial,  automobile,  second  mortgage,
equity and deposit loans. The Bank's market has historically  provided an excess
of savings  deposits over loan demand.  Accordingly,  in addition to originating
loans in its  market  the Bank also  purchases  mortgage-backed  securities  and
investment securities.

The Company's  operations,  as with those of the entire  banking  industry,  are
significantly affected by prevailing economic conditions,  competition,  and the
monetary and fiscal policies of governmental  agencies.  Lending  activities are
influenced by the demand for loans,  competition  among lenders,  the prevailing
market  rates  of  interest,   primarily  on  competing   investments,   account
maturities, and the levels of personal income and savings in the market area.

The earnings of the Bank depend  primarily on its level of net interest  income,
which is the difference between interest income and interest expense. The Bank's
net  interest  income  is a  function  of its  interest  rate  spread,  which is
determined   by  the   difference   between   rates  of   interest   earned   on
interest-earning   assets,  and  rates  of  interest  paid  on  interest-bearing
liabilities.  The Bank's  earnings are also affected by its provision for losses
on loans, as well as the amount of non-interest income and non-interest expense,
such as compensation and related expenses,  occupancy  expense,  data processing
costs and income taxes.

The Company's  strategy for growth emphasizes both internal and external growth.
Operations focus on increasing  deposits,  making loans and providing  customers
with a high  level  of  customer  service.  As part of the  Bank's  emphasis  on
external growth,  the Bank has expanded its operations  within its market areas.
During  fiscal  1998,  the Bank opened a branch  office in Dodge City and a loan
origination  office in the Kansas City area. As part of the Bank's  strategy for
internal  growth,  during  fiscal 1997 the Bank  established  a commercial  loan
department and has been active in increasing its commercial lending market.

This management's  discussion and analysis of financial condition and results of
operations contains or incorporates by reference forward-looking statements that
involve  inherent risks and  uncertainties.  The Company cautions readers that a
number of important factors could cause actual results to differ materially from
those in the forward-looking  statements.  Those factors include fluctuations in
interest rates, inflation, government regulations, economic conditions, adequacy
of allowance  for loan losses,  the costs or  difficulties  associated  with the
resolution  of Year 2000 issues on computer  systems  greater than  anticipated,
technology changes and competition in the geographic and business areas in which
the Company conducts its operations.  These statements are based on management's
current  expectations.  Actual  results in future  periods may differ from those
currently  expected  because  of changes in the  factors  referred  to above and
various risks and uncertainties. 

                                      -6-
<PAGE>

Financial Condition

Consolidated  total assets  decreased  1.09% from  $227,850,154 at September 30,
1997 to  $225,368,013  at September 30, 1998. This slight decrease is the result
of the continued maturity of investment and  mortgage-backed  securities held to
maturity.  The  proceeds  from these  maturities  in addition to the increase in
deposits were used to increase the loan portfolio and purchase treasury stock.

Loans receivable:
Net loans receivable  held-for-investment  increased  $14,651,651 or 9.29%, from
$157,672,603  at September 30, 1997 to  $172,324,254 at September 30, 1998. This
growth in the loan portfolio is attributed to increased  lending  throughout the
year  resulting from the first full year with a commercial  loan  department and
the  addition  of a  loan  origination  branch  in the  Kansas  City  area.  The
commercial  loan department was started during the fourth quarter of fiscal year
1997.  Commercial  loans,  including  commercial  real  estate,  have  increased
$6,799,246 from $6,716,345 at September 30, 1997 to $13,515,591 at September 30,
1998. The bank opened a loan origination  office in Overland Park, Kansas during
the first  quarter of fiscal 1998.  At September 30, 1998 the Kansas City office
had a loan portfolio balance of $6,692,213.  The increase also resulted from the
purchase of $17,885,608  in mortgage loan packages  during fiscal year 1998. The
Bank continues to increase its investment in purchased loans in order to enhance
yield on investable  funds during periods when such amounts exceeded loan demand
in  the  Bank's  primary  lending  area.  Loans   held-for-sale  also  increased
$1,918,455,  or 391.33%,  from  $490,234 at September  30, 1997 to $2,408,689 at
September 30, 1998.  This  continued  increase in the Bank's loan  portfolio has
resulted in a 145.23% increase in total loans during the last five years.

The Bank had impaired  loans of $505,547 and $371,769 at September  30, 1998 and
1997, respectively. A loan is impaired when, based on management's evaluation of
current and historical  information and events,  it is probable that all amounts
due  according  to the  contractual  terms  of the  loan  agreement  will not be
collected.  Loans that are  classified  as  impaired  are  typically  collateral
dependent;  therefore,  impairment is measured  based upon the fair value of the
collateral less estimated costs to sell.  Impairment is recognized by creating a
valuation allowance with a corresponding charge to provision for loss on loans.

Management,  as part of the monitoring and evaluation of  non-performing  loans,
classifies loans and repossessed assets in accordance with regulatory provisions
s loss,  doubtful or substandard.  Total assets  classified as of September 30,
1998 and 1997, amounted to $1,171,000 and $1,328,000,  respectively. Those loans
classified that are not recognized as impaired include loans which are currently
past due 90 days or more or have a past  history  of  delinquency.  The level of
classified loans has continued to remain  consistently low primarily as a result
of improving  economic  conditions and real estate values. At September 30, 1998
the Bank's ratio of total  non-performing  assets to total assets was 0.34%, far
lower than the industry  average.  The Bank will  continue  with its  aggressive
collection policies to keep non-performing assets to a minimum, but no assurance
can be given that  negotiations  with  borrowers will continue to be successful.
Classified  loans have been  considered by  management in the  evaluation of the
adequacy of the  allowance  for loan loss.  Management  is unaware of any trends
which it reasonably  expects will materially  impact future  operating  results,
liquidity, or capital resources.

Investment securities:
Investment securities  held-to-maturity decreased $7,262,509 from $18,837,942 at
September  30, 1997 to  $11,575,433  at September  30, 1998.  This  decrease was
directly  related to the  increase in the loan  portfolio  discussed  above,  as
securities  matured or were  called,  excess  funds were used to  originate  and
purchase loans.  Excess funds were also used to purchase the Company's  treasury
stock.   Investment   securities   available-for-sale   at  September  30,  1998
experienced an increase of $2,098,125  from  $7,122,785 at September 30, 1997 to
$9,220,910  at September  30, 1998 as a result of continued  purchases of equity
securities by the Company.


                                      -7-

<PAGE>

Mortgage-backed securities:
Mortgage-backed  securities decreased $14,965,796 or 40.79%, from $36,689,551 at
September 30, 1997 to  $21,723,755  at September  30, 1998.  The Company did not
have any mortgage-backed securities  available-for-sale at September 30, 1998 or
1997.  Mortgage-backed securities also decreased due to funds from repayments on
mortgage-backed  securities  being used to fund the increase in loans receivable
and repurchase  treasury stock. The Company did not acquire any  mortgage-backed
securities  during the years  ended  September  30,  1998 or 1997.  The yield on
mortgage-backed  securities at September 30, 1998 was 6.77%  compared to a yield
on investment securities of 5.33%.

Foreclosed assets:
The balance in foreclosed  assets at September 30, 1998 and 1997 was $70,939 and
$251,950,  respectively.  The September  30, 1998 balance in  foreclosed  assets
consisted of one single-family residence and three repossessed automobiles. This
foreclosed  asset  balance  continues  to  be  substantially   lower  than  that
experienced by the Bank in prior years.

Deposits:
Deposits  increased  $10,058,177,  or 6.95%,  from $144,734,739 at September 30,
1997 to $154,792,916 at September 30, 1998. This increase  relates  primarily to
the increase in jumbo certificates of deposit of $10,507,180 from $11,174,463 at
September 30, 1997 to  $21,681,643  at September 30, 1998. The increase in jumbo
certificates of deposit relates to the Bank's focus during the year on obtaining
municipal  funds.  The Bank  continues  to offer  rates  competitive  with other
financial  institutions  in the  area.  The  average  cost  on  demand  deposits
decreased  12 basis  points  from 3.22% for fiscal year 1997 to 3.10% for fiscal
year 1998.  This was offset by an increase  in the  average  cost on savings and
certificates  of deposit of 11 basis  points  from 5.32% for fiscal year 1997 to
5.43% for fiscal year 1998. The increase in the cost of savings and certificates
of deposit  is the  result of an  increase  in the  volume of both  savings  and
certificate  of deposit  accounts  in  addition  to an  increase  in rates.  The
rate/volume  analysis  table reflects an increase of $218,000 due to the changes
in volume and an increase of $137,000  due to changes in the rate of savings and
certificate of deposit accounts.

Of the $127,485,196 in certificates of deposit held by the Bank at September 30,
1998,  $88,891,755 of these deposits will mature during the year ended September
30, 1999. The majority of the Bank's time deposits  consist of regular  deposits
from customers and institutional investors from the Bank's surrounding community
rather than brokered deposit accounts. As a result, most of these local accounts
are expected to be renewed.

Advances and other borrowings from Federal Home Loan Bank:
The Bank has  continued  to utilize  advances  from the  Federal  Home Loan Bank
("FHLB")  as a source  of  funds.  Fixed  term  advances  from the FHLB  totaled
$33,700,000  and $36,200,000 at September 30, 1998 and 1997,  respectively.  The
Bank  also has a line of  credit  with  the  FHLB.  The Bank had an  outstanding
balance  of  $8,000,000  and   $10,000,000  at  September  30,  1998  and  1997,
respectively. The funds provided by these borrowings were used primarily to fund
lending  activity  throughout  the  year.  The  weighted  average  cost of these
borrowings  from the FHLB was 5.60% and 6.16% as of September 30, 1998 and 1997,
respectively.  Of the advances and other borrowings outstanding at September 30,
1998, $26,700,000 mature during the year ended September 30, 1999.

Stockholders' equity: 
Stockholders'  equity  decreased  $7,221,563,  or 22.40%,  from  $32,245,330  at
September  30, 1997 to  $25,023,767  at September  30, 1998. As of September 30,
1998 the Company has  repurchased  953,378 shares of its common stock to enhance
stockholder value. Total stock repurchases for the year ended September 30, 1998
amounted to $8,654,310.  As noted in the Stock Price Information section of this
report the Company has also been  consistently  paying  quarterly  dividends  to
stockholders.

                                      -8-

<PAGE>


Implementation of New Accounting Pronouncements

During fiscal year 1998,  the Company  adopted the  provisions of two accounting
pronouncements:  Statement  No. 128 entitled  "Earnings Per Share" and Statement
No. 129 entitled "Disclosure of Information about Capital Structure." See Note 1
to  the  Consolidated  Financial  Statements  for  a  discussion  of  these  new
accounting pronouncements and their effect on the Company.

Liquidity and Capital Resources

Liquidity  is  measured  by a  financial  institution's  ability to raise  funds
through  deposits,  borrowed  funds,  capital  or the sale of highly  marketable
assets such as available-for-sale  securities.  Additional sources of liquidity,
including  cash flows from both  repayment of loans and  maturity of  investment
securities, are also included in determining whether liquidity is satisfactory.

During  the  years  ended  September  30,  1998,  1997 and  1996,  cash and cash
equivalents have increased by $103,326, $2,267,342 and $11,689, respectively.

As  reflected  in the  Consolidated  Statement  of Cash  Flows,  net cash  flows
provided by  operating  activities  for fiscal year 1998,  1997 and 1996 totaled
$3,272,735,  $9,687,358 and  $1,460,520,  respectively.  Amounts  fluctuate from
period to period  primarily as a result of the purchase and origination of loans
held-for-sale  and the  subsequent  sale  of  such  loans.  The  sale  of  loans
held-for-sale was $22,831,874, $12,956,185 and $9,679,305 for fiscal years 1998,
1997 and 1996,  respectively.  This is offset by the origination and purchase of
loans held-for-sale of $21,483,818,  $6,309,686 and $10,344,957 for fiscal years
1998, 1997 and 1996, respectively.

Net cash flows provided by investing activities totaled $624,854 for fiscal year
1998.  Net cash flows  used by  investing  activities  totaled  $17,172,688  and
$4,294,278 for fiscal year 1997 and 1996,  respectively.  Amounts fluctuate from
period to period primarily as a result of (i) principal  repayments on loans and
mortgage-backed   securities,  (ii)  the  purchase  and  origination  of  loans,
mortgage-backed  securities  and  investment  securities and (iii) proceeds from
maturities and sales of investment  securities.  Loans  originated and purchased
for  investment,   net  of  principal   payments  on  loans,  were  $17,928,700,
$35,303,920 and $30,405,369 for fiscal years 1998, 1997 and 1996, respectively.

Net cash flows used by financing  activities  totaled $3,794,263 for fiscal year
1998. Net cash flows  provided by financing  activities  totaled  $9,752,672 and
$2,845,447, respectively, for fiscal years 1997 and 1996. Advances from the FHLB
have been the primary source to balance the Company's  funding needs during each
of the  fiscal  years  presented.  As of  September  30,  1998,  the Bank had an
existing line of credit with the FHLB of $30,000,000  against which the Bank had
an outstanding balance of $8,000,000 that could serve as an additional source of
liquidity.  For fiscal 1998 the Company had net repayments of FHLB borrowings of
$4,500,000,  compared to net  proceeds of  $12,733,332  and  $7,933,334  for the
fiscal years 1997 and 1996,  respectively.  The Company's repurchase of treasury
stock  amounted  to  $8,654,310,  $3,222,729  and  $3,526,306  for years  ending
September  30, 1998,  1997 and 1996,  respectively.  The  repurchase of treasury
stock during this three year period has helped to enhance stockholder value.

The  Company's  principal  asset is its  investment  in the capital stock of the
Bank, and because it does not generate any significant  revenues  independent of
the  Bank,  the  Company's  liquidity  is  dependent  on the  extent to which it
receives  dividends  from the Bank.  The Bank's  ability to pay dividends to the
Company is  dependent  on its ability to generate  earnings  and is subject to a
number  of   regulatory   restrictions,   the   liquidation   account   and  tax
considerations.  Under capital  distribution  regulations  of the OTS, a savings
institution  that,  immediately  prior to, and on a proforma  basis after giving
effect to, a proposed dividend,  has total capital that is at least equal to the
amount of its fully phased-in  capital  requirements (a "Tier I Association") is
permitted  to pay  dividends  during a calendar  year in an amount  equal to the
greater of (i) 75.0% of its net income for the  recent  four

                                      -9-

<PAGE>


quarters, or (ii) 100.0% of its net income to date during the calendar year plus
an amount that would  reduce by one-half  the amount by which its ratio of total
capital  to  assets  exceeded  its  fully  phased-in  risk-based  capital  ratio
requirement  at the beginning of the calendar  year. At September 30, 1998,  the
Bank qualified as a Tier I  Association.  Should the Bank's  regulatory  capital
fall below certain levels,  applicable law would require  approval by the OTS of
such  proposed  dividends  and, in some  cases,  would  prohibit  the payment of
dividends.  Future dividend distributions by the Bank in excess of Bank earnings
could result in recapture of tax bad debt deductions  resulting in income tax on
the  amounts  recaptured.  See  Notes  11,  13 and 21 of Notes  to  Consolidated
Financial   Statements  for   additional   information  on  capital  levels  and
compliance, tax bad debt reserves and the liquidation account.

Cash  dividends  paid by the parent  company to its  common  stock  shareholders
totaled  $929,243,  $677,675 and $752,393 during the fiscal years 1998, 1997 and
1996,  respectively.  The payment of dividends on the common stock is subject to
the  direction of the Board of Directors of the Company and depends on a variety
of factors,  including  operating  results and financial  condition,  liquidity,
regulatory  capital  limitations  and other factors.  It is the intention of the
Bank to continue to pay dividends to the parent company,  subject to regulatory,
income tax and liquidation  account  considerations,  to cover cash dividends on
common stock when and as declared by the parent company.

The Bank is required under applicable federal  regulations to maintain specified
levels of "liquid" investments in qualifying types of U.S.  Government,  federal
agency and other investments  having  maturities of five years or less.  Current
OTS  regulations  require that a savings bank maintain liquid assets of not less
than 4% of its average daily balance of net withdrawable  deposit  accounts.  At
September 30, 1998, the Bank met its liquidity  requirement  and expects to meet
this  requirement  in the future.  The Bank adjusts  liquidity as appropriate to
meet its asset/liability objectives.

OTS has also set minimum capital requirements for institutions such as the Bank.
The capital standards require the maintenance of regulatory  capital  sufficient
to  meet a  tangible  capital  requirement,  a core  capital  requirement  and a
risk-based capital  requirement.  At September 30, 1998 the Bank exceeded all of
the minimum capital requirements as currently required.  Please refer to Note 13
of  the  accompanying  Notes  to  Consolidated  Financial  Statements  for  more
information  regarding the Bank's  regulatory  capital position at September 30,
1998.

As discussed in Note 22 of the financial statements, the Deposit Insurance Funds
Act  of  1996  authorized  the  recapitalization  of  the  Savings  Associations
Insurance Fund (SAIF). After the one-time special assessment,  the Bank's annual
deposit insurance rate declined to 0.064% of insured deposits  effective January
1, 1997 from the 0.23% rate prior to this  recapitalization.  Until December 31,
1999,  SAIF-insured   institutions  will  likely  continue  to  pay  the  0.064%
assessment  to the FDIC to help fund  interest  payments  on bonds  issued by an
agency of the federal  government  established to finance takeovers of insolvent
thrifts.  During this period,  Bank  Insurance Fund (BIF) members likely will be
assessed at the rate of 0.013% to fund interest  payments on these bonds.  After
December 31, 1999, both BIF and SAIF members will likely be assessed at the same
rate for  such  interest  payments.  The  Deposit  Insurance  Funds  Act of 1996
provides  that  the BIF and  the  SAIF  will be  merged  into a  single  deposit
insurance  fund  effective  December 31, 1999,  but only if there are no insured
savings  associations on that date. The  legislation  directed the Department of
Treasury to make  recommendations  to Congress for the establishment of a single
charter for banks and thrifts.

Impact of Inflation and Changing Prices

The financial statements and related data presented herein have been prepared in
accordance  with generally  accepted  accounting  principles,  which require the
measurement of financial  position and operating  results in terms of historical
dollars without considering the change in the relative purchasing power of money
over time due to inflation.  Unlike most  industrial  companies,  nearly all the
assets and  liabilities  of the Bank are monetary. 

                                      -10-

<PAGE>

As a result, interest rates have a greater impact on the Bank's performance than
do the effects of general levels of inflation. Interest rates do not necessarily
move in the same  direction  or to the same  extent  as the  price of goods  and
services.

Asset/Liability Management   

The Bank has established an  Asset/Liability  Management  Committee ("ALCO") for
the purpose of monitoring  and managing  interest rate risk. The Bank is subject
to the  risk of  interest  rate  fluctuations  to the  extent  that  there  is a
difference,  or  mismatch,  between  the amount of the  Bank's  interest-earning
assets and  interest-bearing  liabilities  which  mature or reprice in specified
periods.  Consequently,  when interest  rates  change,  to the extent the Bank's
interest-earning  assets have longer  maturities or effective  repricing periods
than its  interest-bearing  liabilities,  the  interest  income  realized on the
Bank's interest-earning assets will adjust more slowly than the interest expense
on its interest-bearing  liabilities. This mismatch in the maturity and interest
rate sensitivity of assets and liabilities is commonly referred to as the "gap."
A gap is considered  positive when the amount of interest rate sensitive  assets
maturing or repricing  during a specified  period exceeds the amount of interest
rate  sensitive  liabilities  maturing or repricing  during such period,  and is
considered  negative  when the amount of  interest  rate  sensitive  liabilities
maturing or repricing  during a specified  period exceeds the amount of interest
rate assets maturing or repricing during such period. Generally, during a period
of rising  interest  rates, a negative gap would  adversely  affect net interest
income while a positive gap would result in an increase in net interest  income,
and during a period of declining  interest rates, a negative gap would result in
an increase in net interest income while a positive gap would  adversely  affect
net interest  income.  The Bank  utilizes  internally  generated gap reports and
externally prepared interest rate sensitivity of the net portfolio value reports
to monitor and manage its interest rate risk.

The Company has  historically  invested in  interest-earning  assets that have a
longer duration than its interest-bearing  liabilities. The mismatch in duration
of the  interest-sensitive  liabilities  indicates  that the Bank is  exposed to
interest  rate risk. In a rising rate  environment,  in addition to reducing the
market  value of long-term  interest-earning  assets,  liabilities  will reprice
faster than assets; therefore,  decreasing net interest income. To mitigate this
risk, the Bank has placed a greater  emphasis on  shorter-term  higher  yielding
assets that reprice more frequently in reaction to interest rate  movements.  In
addition,  the Bank has continued to include in total assets a concentration  of
adjustable-rate   assets  to  benefit  the  one-year   cumulative  gap  as  such
adjustable-rate  assets  reprice and are more  responsive to the  sensitivity of
more frequently repricing interest-bearing liabilities.

Quarterly, the OTS prepares a report on the interest rate sensitivity of the net
portfolio  value ("NPV") from  information  provided by Bank.  The OTS adopted a
rule in August 1993  incorporating an interest rate risk ("IRR")  component into
the risk-based capital rules.  Implementation of the rule has been delayed until
the OTS has tested the process under which  institutions may appeal such capital
deductions.  The IRR  component  is a dollar  amount that will be deducted  from
total capital for the purpose of calculating an institution's risk-based capital
requirement and is measured in terms of the sensitivity of its NPV to changes in
interest  rates.  The  NPV is  the  difference  between  incoming  and  outgoing
discounted cash flows from assets, liabilities, and off-balance sheet contracts.
An  institution's  IRR is  measured  as the change to its NPV as the result of a
hypothetical 200 basis point change in market interest rates. A resulting change
in NPV of more than 2% of the estimated  market value of its assets will require
the  institution to deduct from its capital 50% of that excess change.  The rule
provides  that the OTS  will  calculate  the IRR  component  quarterly  for each
institution.


                                      -11-

<PAGE>



The  following  tables  present  the  Bank's  NPV as  well as  other  data as of
September 30, 1998, as calculated by the OTS, based on  information  provided to
the OTS by the Bank.
<TABLE>
<CAPTION>

 Change in Interest  
  Rates in Basis
 Points (Rate Shock)        Net Portfolio Value         NPV as % of Present Value of Assets
--------------------  --------------------------------  ------------------------------------

                       $ Amount   $ Change   % Change      NPV Ratio        Change
                      ----------  ---------- ---------  -------------  ---------------------

  (Dollars in Thousands)

  <S>                  <C>        <C>           <C>        <C>              <C>        
     +400 bp              $8,158    ($10,826)    (57) %     3.91   %         (448)    bp
     +300 bp             $11,650      (7,334)    (39) %     5.44   %         (294)    bp
     +200 bp (1)         $14,839      (4,145)    (22) %     6.78   %         (160)    bp
     +100 bp             $17,375      (1,609)     (8) %     7.79   %          (59)    bp
            0 bp         $18,984                            8.39   %
     -100 bp             $19,830         846       4  %     8.66   %           27     bp
     -200 bp             $20,761       1,777       9  %     8.96   %           57     bp
     -300 bp             $21,957       2,973      16  %     9.35   %           97     bp
     -400 bp             $23,288       4,305      23  %     9.78   %          140     bp
</TABLE>            
                  
    (1) Denotes rate shock used to compute interest rate risk capital component.


                                                             September 30, 1998
                                                             ------------------
Risk Measures (20 Basis Point Rate Shock):             

     Pre-Shock NPV Ratio: NPV as % of Present Value of Assets        8.39%
     Exposure Measure: Post-Shock NPV Ratio                          6.78%
     Sensitivity Measure: Change in NPV Ratio                        1.60%



Utilizing the data above,  the Bank, at September 30, 1998,  would not have been
considered by the OTS to have been subject to "above normal" interest rate risk.
Accordingly, no deduction from risk-based capital would have been required.

Set forth below is a breakout, by basis points of the Bank's NPV as of September
30, 1998 by assets, liabilities, and off balance sheet items.

<TABLE>
<CAPTION>
                                                                           No        
 Net Portfolio Value  -400 bp      -300 bp      -200 bp      -100 bp     Change    +100 bp   +200 bp   +300 bp   +400 bp
-----------------------------------------------------------------------------------------------------------------------------

<S>                   <C>         <C>          <C>          <C>         <C>       <C>       <C>       <C>       <C>     
Assets                 $238,084    $234,806     $231,740     $229,014    $226,400  $223,043  $218,794  $213,959  $208,891
-Liabilities            214,474     212,603      210,804      209,075     207,400   205,795   204,235   202,726   201,269
+Off Balance Sheet         (322)       (246)        (175)        (109)        (16)      127       280       417       536
                     -----------------------------------------------------------------------------------------------------
Net Portfolio Value     $23,288     $21,957      $20,761      $19,830     $18,984   $17,375   $14,839   $11,650    $8,158
                     =====================================================================================================
</TABLE>

Certain  assumptions  utilized by the OTS in assessing the interest rate risk of
savings  associations  were  employed in  preparing  the previous  table.  These
assumptions  related to interest  rates,  loan prepayment  rates,  deposit decay
rates and the market  values of certain  assets under the various  interest rate
scenarios.  It was also  assumed  that  delinquency  rates  will not change as a
result of changes in interest rates although there can be no assurance that this
will be the case. Even if interest rates change in the designated amounts, there
can be no assurance that the Bank's assets and liabilities  would perform as set
forth above.

Certain  shortcomings  are inherent in the preceding NPV tables because the data
reflect  hypothetical  changes in NPV based upon  assumptions used by the OTS to
evaluate the Bank as well as other  institutions.  However,  net

                                      -12-

<PAGE>

interest  income should decline with  instantaneous  increases in interest rates
while net  interest  income  should  increase  with  instantaneous  declines  in
interest rates.  Generally,  during periods of increasing  interest  rates,  the
Bank's  interest  rate  sensitive  liabilities  would  reprice  faster  than its
interest rate  sensitive  assets  causing a decline in the Bank's  interest rate
spread and  margin.  This would  result  from an  increase in the Bank's cost of
funds  that  would  not be  immediately  offset by an  increase  in its yield on
earning assets. An increase in the cost of funds without an equivalent  increase
in the yield of earning assets would tend to reduce net interest income.

In times of decreasing interest rates, fixed rate assets could increase in value
and the lag in repricing of interest rate sensitive  assets could be expected to
have a positive effect on the Bank's net interest  income.  However,  changes in
only certain rates,  such as shorter term interest rate declines  without longer
term interest rate declines,  could reduce or reverse the expected  benefit from
decreasing interest rates.

Year 2000 Issue

The  year  2000  poses  an  important  business  issue  regarding  how  existing
application  software  programs and operating  systems can accommodate this date
value.  Many computer programs that can only distinguish the final two digits of
the year  entered  are  expected  to read  entries for the year 2000 as the year
1900. Like most financial  service  providers,  the Company may be significantly
affected by the Year 2000 issue due to the nature of financial information.  The
Company has been evaluating both information  technology  (computer  systems and
software)  and  non-information   technology  (i.e.  vault  timers,   elevators,
electronic door lock and heating,  ventilation and air condition  controls) both
within and  outside  the  Company's  direct  control  and with which the Company
electronically  or  operationally   interfaces.  If  computer  systems  are  not
adequately  changed to identify the year 2000, many computer  applications could
fail or create erroneous  results.  As a result,  many calculations that rely on
the date field  information,  such as  interest,  payment or due dates and other
operating functions, may generate results that could be significantly misstated,
and the Company could experience a temporary  inability to process  transactions
and engage in normal business activities.

The Company  has also  initiated  formal  communications  with both  information
technology  and  non-information  technology  vendors to determine the extent to
which the Company's  interface systems may be vulnerable to those third parties'
failure to  remediate  their own Year 2000 issues.  We have  examined all of our
non-information  technology  systems and have either received  certifications of
Year  2000  compliance  for  systems  controlled  by third  party  providers  or
determined  that the systems  should not be impacted by the Year 2000. We expect
to further  test the systems we control and receive  third party  certification,
where  appropriate,  that they will  continue to function.  We do not expect any
material costs to address our  non-information  technology  systems and have not
had any  material  costs  to  date.  We have  determined  that  the  information
technology  systems  we use have  substantially  more  year  2000  risk than the
non-information  technology  systems  we  use.  The  Bank  has  evaluated  their
information  technology  systems risk in three areas: (1) internal computers and
software,  (2)  computers of others used by our  borrowers,  (3)  external  data
processing servicers.

Internal computers and software
The Company will replace or upgrade  most of its internal  computer  systems and
programs in order to provide  cost-effective  and efficient delivery of services
to its customers,  information to management, and to provide additional capacity
for processing information and transactions due to increased activity.  Computer
system  upgrades  are  projected to be  completed  during the second  quarter of
fiscal 1999. The total cost of the Year 2000 project is estimated to approximate
$400,000  which will be funded through cash flows from  operations.  The Company
will spend approximately $250,000 during the first and second quarters of fiscal
1999 to upgrade computer  systems,  which will be capitalized.  At September 30,
1998,  none of the estimated  $250,000 has been  capitalized.  The Bank expensed
approximately  $10,000  relating to Year 2000  compliance  during the year ended
September   30,  1998.   In  addition,   the  Company  will  expect  to  expense
approximately  $75,000 during fiscal 1999. This results in estimated known costs
to the Bank of $325,000. The Bank estimates a potential of an 

                                      -13-

<PAGE>

additional  $75,000 in unidentified  costs at the present time. Final testing of
internal conversion to compliant systems is scheduled to be completed by the end
of the first quarter of calendar 1999.

Computers of others used by our borrowers
The Bank has evaluated  most of its borrowers and does not believe that the Year
2000 issue should, on an aggregate basis,  impact their ability to make payments
to the Bank.  The Bank  feels  that most of its  residential  borrowers  are not
dependent  on their home  computers  for income and that none of its  commercial
borrowers  are so large that a Year 2000  problem  would  render  them unable to
collect  revenue or rent and,  in turn,  continue  to make loan  payments to the
Bank. As a result, the Bank has not contacted  residential  borrowers concerning
this issue and does not consider this issue in its residential loan underwriting
process.  The Bank has contacted all commercial  borrowers and  considered  this
issue during commercial loan underwriting. The Bank does not expect any material
costs to address this risk area.

External data processing servicer
This risk is primarily  focused on one third-party  service bureau that provides
virtually all of the Bank's data processing. The Bank's data processing servicer
has completed  their Year 2000 testing and was  determined to be in  compliance.
The  third-party  servicer  also has a  contingency  plan  developed  to provide
operating alternatives in the event of systems or communication  failures.  This
contingency plan has a procedure in which a disaster  recovery unit will be sent
to the Bank  immediately  to  correct  any  Year  2000  complications.  Although
appearing to be compliant, if the service bureau fails to be Year 2000 compliant
the Bank would likely experience significant delays, mistakes or failures. These
delays,  mistakes  or  failures  could have a  significant  impact on the Bank's
financial condition and results of operations.

Contingency plan
Senior  management  has  developed  and  presented  to the Board of  Directors a
contingency plan to provide operating  alternatives for continuation of services
to the Bank's customers in the event of systems or communication failures at the
beginning of the Year 2000.  Management  believes  that the Bank will be able to
continue to operate in the Year 2000 even if some  systems  fail.  The Bank will
have available a back-up  generator for use in the event of a power failure.  At
the end of  December  1999,  the Bank  will  receive  from  its data  processing
servicer a CD-ROM backup of all customer and general ledger  accounts.  The Bank
will also have a stand  alone  computer  with  internal  software to extract the
information  from the  CD-ROM and print hard copy  reports  as  necessary.  This
software has been  certified as Year 2000 compliant by the provider and has been
tested at other customer locations of the service provider.  As noted above, the
disaster  recovery  unit  provided  by the Bank's  service  center  will also be
available.  Due to the  size of the  Bank,  it  feels  that it  would be able to
operate with all transactions  processed  internally until normal operations can
be restored.  This procedure  could require  changing of schedules and hiring of
temporary staff, which would increase cost of operations. If this procedure were
to continue for any extended  period of time, or if we ultimately  had to change
data service providers, the cost could be material.

                                      -14-


<PAGE>

Average Balances, Interest and Average Yields and Rates


The  following  table sets forth certain  information  relating to the Company's
average  balance sheet and reflects the average yield on assets and average cost
of liabilities for the periods indicated and the average yields earned and rates
paid.  Such yields and costs are  derived by  dividing  income or expense by the
average  balance  of  assets  or  liabilities,  respectively,  for  the  periods
presented. Average balances are derived from month-end balances. Management does
not believe that the use of month-end balances instead of daily average balances
has caused any material difference in the information presented.
<TABLE>
<CAPTION>
                                                                          For Year Ended September 30,
                                        At        -------------------------------------------------------------------------------
                                    September 30,
                                       1998               1998                       1997                      1996
                                    ---------- -------------------------  ------------------------- -----------------------------
                                                                 Average                    Average                      Average 
                                      Yield/                      Yield/                    Yield/                        Yield/
                                       Cost    Balance   Interest  Cost   Balance  Interest  Cost   Balance   Interest    Cost
                                    ---------  --------  -------- ------  -------- -------- ------  --------  --------   --------
                              (Dollars in Thousands)
<S>                                   <C>     <C>       <C>      <C>     <C>       <C>      <C>     <C>      <C>        <C>    
Interest-earning assets:
  Loans receivable                     8.14 %  $167,490  $13,741  8.20 %  $145,395  $11,833  8.14 %  $110,084  $ 9,077    8.25  %
  Mortgage-backed securities           6.77 %    29,724    1,927  6.48 %    41,747    2,707  6.48 %    54,647    3,557    6.51  %
  Investment securities                5.33 %    23,366    1,374  5.88 %    30,956    2,079  6.72 %    29,936    1,863    6.22  %
  Other interest-earning assets        5.72 %     3,169      165  5.21 %     1,252       76  6.07 %     1,085       78    7.19  %
                                    ---------  --------  -------  ------  --------  -------  ------  --------  -------    -------

     Total interest-earning assets     7.71 %  $223,749  $17,207  7.69 %  $219,350  $16,695  7.61 %  $195,752  $14,575    7.45  %
                                    =========  ========  =======  ======  ========  =======  ======  ========  =======    =======

Non-interest earning assets:                      5,580                      4,310                      3,764
                                               --------                   --------                   -------- 

     Total assets                              $229,329                   $223,660                   $199,516
                                               ========                   ========                   ======== 

Interest-bearing liabilities:
  Demand deposits                      2.79 %  $ 21,586  $   669  3.10 %  $ 21,536  $   693  3.22 %  $ 14,249  $   365    2.56  %
  Savings deposits and certificates
    of deposit                         5.45 %   127,290    6,917  5.43 %   123,206    6,556  5.32 %   128,899    7,077    5.49  %
  Other liabilities                    5.60 %    44,763    2,631  5.88 %    42,951    2,520  5.87 %    19,429    1,237    6.37  %
                                    ---------  --------  -------  ------  --------  -------  ------  --------  -------   -------
     Total interest-bearing
      liabilities                      5.20 %  $193,639  $10,217  5.28 %  $187,693  $ 9,769  5.20 %  $162,577  $ 8,679    5.34  %
                                    =========  ========  =======  ======  ========  =======  ======  ========  =======   =======
Non-interest bearing liabilities                  4,242                      3,696                      3,015
                                               --------                   --------                   -------- 
     Total liabilities                         $197,881                   $191,389                   $165,592
                                               ========                   ========                   ========

Stockholder's equity                             31,448                     32,271                     33,924
                                               ---------                  --------                   --------
     Total liabilities and
      stockholders' equity                     $229,329                   $223,660                   $199,516
                                               =========                  ========                   ========
Net interest income                                      $ 6,990                    $ 6,926                    $ 5,896
                                                         =======                    =======                    =======

Interest rate spread                   2.51 %                     2.41 %                     2.41 %                      2.11  %
                                    =========                     ======                     ======                      =======

Net yield on interest-earning assets                              3.12 %                     3.16 %                      3.01  %
                                                                  ======                     ======                      =======
Ratio of interest-earning assets
    to interest-bearing liabilities                             115.55 %                   116.87 %                    120.41  %
                                                                ========                   ========                    =========


</TABLE>




                                      -15-
<PAGE>

The following  Rate/Volume  Analysis table presents,  for the periods indicated,
information  regarding  changes in  interest  income and  interest  expense  (in
thousands)  of the Company.  For each  category of  interest-earning  assets and
interest-bearing   liabilities,   information   is   provided   on  the  changes
attributable  to (i) changes in volume (changes in average daily balances of the
portfolio  multiplied by the prior year rate),  (ii) changes in rate (changes in
rate multiplied by prior year volume), and (iii) changes in rate/volume (changes
in rate multiplied by the change in average volume).

<TABLE>
<CAPTION>


                                                                    Years Ended September 30,
                                        -----------------------------------------------------------------------------------
                                                      1998 vs. 1997                           1997 vs. 1996
                                        ---------------------------------------   -----------------------------------------
                                              Increase (Decrease) Due to                Increase (Decrease) Due to
                                        ---------------------------------------   -----------------------------------------
                                                              Rate/                                      Rate/
                                         Volume      Rate     Volume      Net      Volume      Rate      Volume      Net
                                        --------   --------   ------   --------   --------   --------   --------   --------
                                                                            (In Thousands)
<S>                                     <C>        <C>        <C>      <C>        <C>        <C>        <C>        <C>    
Interest income:
 Loans receivable                       $ 1,799    $    88    $  21    $ 1,908    $ 2,913    ($  121)   ($   36)   $ 2,756
 Mortgage-backed securities                (779)         0       (1)      (780)      (840)       (16)         6       (850)
 Investment securities                     (510)      (260)      65       (705)        63        150          3        216
 Other interest-earnings assets             117        (10)     (18)        89         13        (11)        (4)        (2)
                                        --------   --------   ------   --------   --------   --------   --------   --------  
   Total interest-earning assets        $   627    ($  182)   $  67    $   512    $ 2,149    $     2    ($   31)   $ 2,120
                                        ========   ========   ======   ========   ========   ========   ========   ========
Interest expense:
 Demand deposits                        $     2    ($   26)   $   0    ($   24)   $   187    $    94    $    47    $   328
 Savings deposits and
  certificates of deposits                  218        137        6        361       (313)      (219)        11       (521)
 Other liabilities                          107          4        0        111      1,498        (97)      (118)     1,283
                                        --------   --------   ------   --------   --------   --------   --------   --------
   Total interest-bearing liabilities   $   327    $   115    $   6    $   448    $ 1,372    ($  222)   ($   60)   $ 1,090
                                        ========   ========   ======   ========   ========   ========   ========   ========
Change in net interest income           $   300    ($  297)   $  61    $    64    $   777    $   224    $    29    $ 1,030
                                        ========   ========   ======   ========   ========   ========   ========   ========
</TABLE>
                                       
Results of Operations

General:
Net income decreased slightly,  from $2,514,437 for the year ended September 30,
1997 to $2,363,798  for the year ended  September 30, 1998.  The decrease in net
income  relates  primarily  to an increase in costs of the core  business of the
subsidiary Bank as a result of establishing a commercial loan department and the
additional  expense of providing retail services in the existing  branches,  the
new Dodge City  branch and the  Overland  Park loan  origination  office.  These
increased  expenses are expected and intended to lead to increased volume in the
customer base, resulting in increased loan and general market share.

Net income  increased  $1,110,211 or 79.06% from  $1,404,226  for the year ended
September  30, 1996 to  $2,514,437  for the year ended  September  30, 1997.  As
discussed  in the  following  paragraphs  the  net  income  for the  year  ended
September  30, 1996  included a special  one-time  SAIF  assessment  of $937,073
which, net of tax effect,  resulted in decreasing fiscal year 1996 net income by
approximately  $600,000.  Exclusive of the effect of the assessment on 1996, net
income for fiscal  1997  increased  over 1996 by  approximately  $530,000.  This
increase is primarily attributable to an increase in net interest income.

On September 30, 1996,  President  Clinton  signed into law a bill that provided
for a special  assessment of SAIF insured  institutions  amounting to 65.7 basis
points  applied to the Bank's  deposit base  measured as

                                      -16-

<PAGE>

of March 31, 1995.  The total amount of the special  assessment for the Bank was
accrued as of  September  30,  1996 and  included  in expense for the year ended
September  30, 1996.  The after tax effect of the  assessment  was to reduce net
income by approximately  $600,000 for the year ended September 30, 1996. Without
the effect of the assessment net income would have been approximately $2,000,000
for the year ended September 30, 1996.

Net interest income:
The  operating  results  of the  Company  depend  to a great  degree  on its net
interest   income,   which  is  the  difference   between   interest  income  on
interest-earning  assets,  primarily  loans,   mortgage-backed   securities  and
investment  securities,  and interest expense on  interest-bearing  liabilities,
primarily deposits and borrowings.  The Company's net income is also affected by
the  level of its  provision  for  losses  on  loans,  non-interest  income  and
non-interest expense.

Total interest income increased $512,592,  or 3.07%, to $17,207,440 for the year
ended  September 30, 1998,  from  $16,694,848  for the year ended  September 30,
1997. This increase resulted from the average yield on  interest-earning  assets
increasing to 7.69% for the year ended  September 30, 1998 compared to 7.61% for
the year ended  September 30, 1997. This increase was the result of the increase
in the loan portfolio,  the  rate/volume  analysis  reflects this increase.  The
change in interest income due to the volume of loans  receivable was an increase
of $1,799,000  during fiscal year 1998 from fiscal year 1997.  Income  resulting
from the increase in loan volume was partially offset by decreases in the volume
of investment and mortgage-backed securities.

Interest  expense for the year ended September 30, 1998 increased  $448,271,  or
4.59%,  to $10,216,563  from  $9,768,292 at September 30, 1997. This increase is
primarily  due to an  increase in volume of  certificates  of deposit and market
interest rates paid on those deposits.  The Bank's rate/volume analysis reflects
approximately  $327,0000  of the  increase in interest  expense  resulting  from
changes in volume.

As a result of the above,  net interest income had a slight increase of $64,321,
from $6,926,556 for the year ended September 30, 1997 to $6,990,877 for the year
ended September 30, 1998. The increase in net interest income is attributable to
a shift in the  composition  of  interest-earning  assets from  generally  lower
yielding  mortgage-backed  and investment  securities to loans,  resulting in an
increase in net interest  income  attributable  to volume of  $300,000.  The net
interest spread of the Bank was consistent  during the years ended September 30,
1998 and 1997,  with an interest rate spread of 2.41% for both years.  The risks
related to interest  rate  movement  are managed  and  continuously  reviewed by
management.

Interest  income was  $16,694,848 for the year ended September 30, 1997 compared
to $14,574,868  for the year ended September 30, 1996, an increase of $2,119,980
or 14.55%.  As discussed above, this increase is also primarily the result of an
increase in loans  receivable  during the year ended September 30, 1997, this is
reflected in the Bank's rate/volume  analysis as the increase in interest income
resulting from the volume of loans receivable was $2,913,000.

Interest expense for the year ended September 30, 1997 increased $1,089,924,  or
12.56%,  to $9,768,292  from $8,678,368 at September 30, 1996. This increase was
due to the increase in borrowed funds throughout the fiscal year.  Approximately
$1,498,000  of the  increase in  interest  expense was due to an increase in the
volume of other  liabilities,  which  consists of advances and other  borrowings
from the FHLB.  The  average  cost for  interest-bearing  liabilities  decreased
slightly from 5.34% for the year ended  September 30, 1996 to 5.20% for the year
ended September 30, 1997.

As a result of the above, net interest income increased  $1,030,056,  or 17.47%,
from $5,896,500 for the year ended September 30, 1996 to $6,926,556 for the year
ended  September 30, 1997.  The net interest

                                      -17-


<PAGE>

spread of the Bank increased from 2.11% for the year ended September 30, 1996 to
2.41% for the year ended  September  30, 1997,  an increase of 30 basis  points.
Interest costs on liabilities  increase or decrease  faster than interest yields
on assets, as shorter term liabilities reprice or adjust for changes in interest
rates quicker than longer  maturity  assets.  This  increase in interest  spread
related to the  significant  increase in  origination  and purchases of mortgage
loans at yields in excess of yields on maturing  investments and mortgage-backed
securities.

Provision for losses on loans:
The Bank maintains, and the Board of Directors monitors, allowances for possible
losses on loans.  These  allowances  are  established  based  upon  management's
periodic evaluation of known and inherent risks in the loan portfolio, review of
significant  individual loans and collateral,  review of delinquent  loans, past
loss experience,  adverse  situations that may affect the borrowers'  ability to
repay,  current and expected  market  conditions,  and other factors  management
deems important.  Determining the appropriate  level of reserves involves a high
degree of management  judgment and is based upon historical and projected losses
in the  loan  portfolio  and the  collateral  value of  specifically  identified
problem loans.  Additionally,  allowance  strategies and policies are subject to
periodic  review and revision in response to current market  conditions,  actual
loss experience and management's expectations.

The allowance for loan losses was  $1,136,753 and $968,623 at September 30, 1998
and 1997, respectively. The provision for losses on loans is the method by which
the allowance for losses is adjusted during the period. The provision for losses
on loans was $265,000 for the year ended September 30, 1998 and $307,979 for the
year ended  September 30, 1997. The increase in the allowance for the year ended
September  30, 1998 was based on  management's  evaluation  of the  allowance in
relation to the increase in the Bank's loan  portfolio,  including  increases in
non-mortgage  lending,  and the  increase in  non-performing  loans.  Historical
non-performing  loan ratios are presented with the five-year  financial  summary
information.  While management maintains its allowance for loan losses at levels
which it considers  adequate to provide for  potential  losses,  there can be no
assurance  that  additions will not be made to the allowance in future years and
that such losses will not exceed the estimated amounts.

The allowance for loan losses was $740,346 at September 30, 1996.  The provision
for losses on loans  increased  from  $134,743 for the year ended  September 30,
1996 to $307,979 for the year ended September 30, 1997. The $173,236 increase in
the  provision for the year ended  September 30, 1997 was based on  management's
evaluation  of the  allowance  in  relation  to the  increase in the Bank's loan
portfolio, as discussed above.

Non-interest income:
Non-interest income increased $199,937,  or 19.49%, from $1,026,021 for the year
ended  September 30, 1997 to $1,225,958  for the year ended  September 30, 1998.
This was  primarily  due to the net gain on the  sale of loans of  $472,908  for
fiscal year 1998 compared to $237,281 for fiscal 1997, a $235,627  increase,  or
99.3%.

Non-interest  income  increased  $280,661 or 37.65%,  from $745,360 for the year
ended  September 30, 1996 to $1,026,021  for the year ended  September 30, 1997.
The main reason for this increase was due to the net gain on sale of investments
of $220,154,  consisting of sales of corporate  equity  securities,  which was a
$193,047  increase  from  the net  gain on the sale of  investments  of  $27,107
realized during the year ended September 30, 1996. Additionally, gain on sale of
loans  increased  by 188.63% due to an increase in the volume of loan sales from
fiscal  year  1997 to  fiscal  year  1996.  Sale  of  loans  held-for-sale  were
$12,956,185 for the year ended September 30, 1997 compared to $9,679,305 for the
year ended September 30, 1996.

                                      -18-

<PAGE>

Non-interest expense:
Non-interest expense increased $554,361,  or 15.48% from $3,580,077 for the year
ended  September 30, 1997 to $4,134,438  for the year ended  September 30, 1998.
The Bank has experienced an overall increase in non-interest expense as a result
of the addition of a commercial loan department,  the loan origination office in
Overland Park, and the new Dodge City branch.  These increases  relate primarily
to increases in  compensation  as a result of new  positions.  Compensation  and
related expenses increased $252,108,  or 11.24%, from $2,242,602 for fiscal 1997
to $2,494,710 for fiscal 1998.  This increase in compensation is also the result
of increase in the  Employees  Stock  Ownership  Plan (the "ESOP")  expense as a
result of higher market values for allocated shares and additional  compensation
expense relating to the issuance of stock options,  see Note 16 of the financial
statements for further discussion.

Non-interest  expense decreased  $743,222 or 17.19% from $4,323,299 for the year
ended  September 30, 1996 to $3,580,077  for the year ended  September 30, 1997.
This  decrease  related  primarily to the special  one-time  SAIF  assessment of
$937,073 recorded during fiscal 1996. If this special  assessment were excluded,
total  non-interest  expense would have increased  $193,851 or 5.72% from fiscal
1996 to 1997.  Compensation  and related expenses  increased  $349,144 or 18.44%
during the year ended  September  30,  1997,  relating to overall  increases  in
compensation  and ESOP expense as discussed  above. The increase in compensation
was offset by a $191,250 or 49.04% decrease in federal insurance premium expense
from $389,986  during fiscal year 1996 to $198,736  during fiscal year 1997. The
decrease in regulatory  insurance and assessments was  substantially  due to the
revised  rate  structure  on  insured  deposits  adopted  by the FDIC  after the
recapitalization of the SAIF. The Bank's annual deposit insurance rate in effect
prior to this recapitalization was 0.23% of insured deposits, declining to 0.18%
of insured  deposits for the quarter  ended  December  31, 1996,  and reduced to
0.064% of insured deposits effective January 1, 1997.

Income taxes:
Income tax expense  decreased  $96,485,  or 6.22%,  from $1,550,084 for the year
ended  September 30, 1997 to $1,453,599  for the year ended  September 30, 1998.
This decrease in income tax resulted primarily from a decrease in pre-tax income
and deferred tax  attributable to changes in state income tax rates that for the
Bank become effective as of October 1, 1998.

The Company's income tax expense increased $770,492 or 98.83%, from $779,592 for
the year ended September 30, 1996 to $1,550,084 for the year ended September 30,
1997. The principal reason for the increase was the increase in pre-tax income.


                                      -19-

<PAGE>
[LOGO]                                                                 MEMBER OF
                                                       THE AMERICAN INSTITUTE OF
                                                    CERTIFIED PUBLIC ACCOUNTANTS
[LOGO]    Regier Carr & Monroe, L.L.P.                 THE DIVISION OF CPA FIRMS
--------------------------------------------------------------------------------




                          Independent Auditor's Report




To the Board of Directors and Stockholders of
Landmark Bancshares, Inc.
Dodge City, Kansas


We have audited the accompanying  consolidated statements of financial condition
of Landmark  Bancshares,  Inc. and subsidiary as of September 30, 1998 and 1997,
and the related consolidated statements of operations,  changes in stockholders'
equity and cash flows for each of the three years in the period ended  September
30, 1998.  These financial  statements are the  responsibility  of the Company's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects, the financial position of Landmark Bancshares,
Inc. and  subsidiary as of September 30, 1998 and 1997, and the results of their
operations  and cash  flows  for each of the  three  years in the  period  ended
September 30, 1998 in conformity with generally accepted accounting principles.



                                   /s/Regier Carr & Monroe, L.L.P.

                                   Regier Carr & Monroe, L.L.P.


October 29, 1998
Wichita, Kansas


<TABLE>
<CAPTION>
<S>                            <C>                          <C>            <C>  
300 WEST DOUGLAS, SUITE 100  o  WICHITA, KANSAS 67202-2994 o 316 264-2335 o FAX 316 264-1489
                                   WICHITA o TUCSON o TULSA
</TABLE>

                                      F-1
<PAGE>
                            Landmark Bancshares, Inc.

                 Consolidated Statements of Financial Condition
                           September 30, 1998 and 1997
<TABLE>
<CAPTION>

ASSETS                                                                1998             1997
                                                                  -------------    -------------
<S>                                                               <C>              <C>          
Cash and due from banks:
         Non-interest bearing                                     $     832,559    $     678,173
         Interest bearing                                             2,011,819        2,062,879
                                                                  -------------    -------------
         Total cash and due from banks                                2,844,378        2,741,052
Time deposits in other financial institutions                           249,867          110,580
Investment securities held-to-maturity (estimated market
         value of $11,681,144 and $18,907,385 at September 30,
         1998 and 1997, respectively)                                11,575,433       18,837,942
Investment securities available-for-sale                              9,220,910        7,122,785
Mortgage-backed securities held-to-maturity (estimated
         market value of $22,006,970 and $36,933,775 at
         September 30, 1998 and 1997, respectively)                  21,723,755       36,689,551
Loans receivable, net                                               172,324,254      157,672,603
Loans held-for-sale                                                   2,408,689          490,234
Accrued income receivable                                             1,443,847        1,446,605
Foreclosed real estate, net                                              70,939          251,950
Office properties and equipment, net                                  1,729,282        1,188,250
Prepaid expenses and other assets                                     1,749,177        1,233,038
Income taxes receivable, current                                         27,482           65,564
                                                                  -------------    -------------
              Total assets                                        $ 225,368,013    $ 227,850,154
                                                                  =============    =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
         Deposits                                                 $ 154,792,916    $ 144,734,739
         Borrowings from Federal Home Loan Bank                      41,700,000       46,200,000
         Advances from borrowers for taxes and insurance              1,904,170        1,673,057
         Accrued expenses and other liabilities                       1,737,080        2,304,593
         Deferred income taxes                                          210,080          692,435
                                                                  -------------    -------------
              Total liabilities                                     200,344,246      195,604,824
                                                                  -------------    -------------
Commitments and contingencies
Stockholders' equity:
         Preferred stock, no par value; 5,000,000 shares
           authorized; no shares outstanding
         Common stock, $0.10 par value; 10,000,000 shares
           authorized; 2,281,312 shares issued and outstanding          228,131          228,131
         Additional paid-in capital                                  22,466,144       22,173,827
         Retained income, substantially restricted                   20,739,642       19,305,087
         Unrealized gain on available-for-sale securities,
           net of deferred taxes                                        283,336          922,384
         Unamortized stock acquired by Employee Stock
           Ownership Plan                                              (692,719)        (844,597)
         Unamortized compensation related to Management
           Stock Bonus Plan                                             (96,522)        (289,567)
         Treasury stock, at cost, 953,378 and 592,671 shares at
           September 30, 1998 and 1997, respectively                (17,904,245)      (9,249,935)
                                                                  -------------    -------------

              Total stockholders' equity                             25,023,767       32,245,330
                                                                  -------------    -------------

              Total liabilities and stockholders' equity          $ 225,368,013    $ 227,850,154
                                                                  =============    =============
</TABLE>


The Notes to  Consolidated  Financial  Statements  are an integral part of these
statements.
                                      F-2
<PAGE>
                            Landmark Bancshares, Inc.

                      Consolidated Statements of Operations
              For the Years Ended September 30, 1998, 1997 and 1996
<TABLE>
<CAPTION>
                                                          1998            1997           1996
                                                      ------------    ------------   ------------
<S>                                                   <C>             <C>            <C>         
Interest income:
    Interest on loans                                 $ 13,741,660    $ 11,832,611   $  9,076,880
    Interest and dividends on investment securities      1,538,935       2,154,856      1,940,908
    Interest on mortgage-backed securities               1,926,845       2,707,381      3,557,080
                                                      ------------    ------------   ------------
         Total interest income                          17,207,440      16,694,848     14,574,868
                                                      ------------    ------------   ------------
Interest expense:
    Deposits                                             7,585,688       7,248,750      7,441,797
    Borrowed funds                                       2,630,875       2,519,542      1,236,571
                                                      ------------    ------------   ------------
         Total interest expense                         10,216,563       9,768,292      8,678,368
                                                      ------------    ------------   ------------
         Net interest income                             6,990,877       6,926,556      5,896,500

Provision for losses on loans                              265,000         307,979        134,743
                                                      ------------    ------------   ------------
    Net interest income after provision for losses       6,725,877       6,618,577      5,761,757
                                                      ------------    ------------   ------------
Non-interest income:
    Service charges and late charges                       339,478         270,622        217,317
    Net gain on sale of investments                        202,299         220,154         27,107
    Net gain on sale of loans                              472,908         237,281         82,208
    Net gain on sale of mortgage-backed securities                                        135,208
    Service fees on loans sold                             157,032         161,304        161,329
    Other                                                   54,241         136,660        122,191
                                                      ------------    ------------   ------------
         Total non-interest income                       1,225,958       1,026,021        745,360
                                                      ------------    ------------   ------------
Non-interest expense:
    Compensation and related expenses                    2,494,710       2,242,602      1,893,458
    Occupancy expense                                      243,633         173,452        169,780
    Federal insurance premium                              156,064         198,736        389,986
    SAIF special assessment                                                               937,073
    Data processing                                        207,733         181,321        187,237
    Other expense                                        1,032,298         783,966        745,765
                                                      ------------    ------------   ------------
         Total non-interest expense                      4,134,438       3,580,077      4,323,299
                                                      ------------    ------------   ------------
         Income before income taxes                      3,817,397       4,064,521      2,183,818
                                                      ------------    ------------   ------------
Income taxes:
    Currently payable                                    1,529,953       1,261,177      1,085,774
    Deferred tax expense (benefit)                         (76,354)        288,907       (306,182)
                                                      ------------    ------------   ------------
                                                         1,453,599       1,550,084        779,592
                                                      ------------    ------------   ------------
         Net income                                   $  2,363,798    $  2,514,437   $  1,404,226
                                                      ============    ============   ============
Income per common share
Basic:
    Earnings per share                                $       1.56    $       1.52   $       0.78
                                                      ============    ============   ============
    Weighted average common and common
      shares outstanding                                 1,518,482       1,652,339      1,810,182
                                                      ============    ============   ============
Diluted:
    Earnings per share                                $       1.42    $       1.42   $       0.74
                                                      ============    ============   ============
    Weighted average common and common
      shares outstanding                                 1,664,950       1,774,121      1,892,443
                                                      ============    ============   ============
</TABLE>

The Notes to  Consolidated  Financial  Statements  are an integral part of these
statements.
                                      F-3
<PAGE>
                           Landmark Bancshares, Inc.
           Consolidated Statements of Changes in Stockholders' Equity
                  Years Ended September 30, 1998, 1997 and 1996
<TABLE>
<CAPTION>
                                                               Unrealized   Unamortized
                                                                Gain on        Common    Unamortized
                                     Additional                Available-      Stock     ompensation                    Total
                          Common       Paid-In     Retained     for-Sale    Acquired by   Related to      Treasury   Stockholders'
                           Stock       Capital      Income     Securities     ESOP           MSBP          Stock        Equity
                         ---------- ------------ ------------ -----------  ------------- ------------  ------------- -------------
<S>                      <C>       <C>          <C>            <C>         <C>           <C>          <C>            <C>        
Balance, 
  September 30, 1995      $228,131  $21,893,499  $16,816,492     $37,454    ($1,131,573)   ($675,657)   ($2,500,900)  $34,667,446
Allocation of shares 
  by Employees' Stock
  Ownership Plan                         50,676                                 136,878                                   187,554
Amortization of 
  compensation related 
  to Management Stock 
  Bonus Plan                                                                                 193,045                      193,045
Net income for the 
  year ended 
  September 30, 1996                               1,404,226                                                            1,404,226
Cash dividend paid 
  ($0.40 per share)                                 (752,393)                                                            (752,393)
Net change in unrealized 
  gain on available-for-
  sale investment 
  securities                                                     215,603                                                  215,603
Purchase of 232,336 
  treasury shares                                                                                        (3,526,306)   (3,526,306)
                         ---------- ------------ ------------ -----------  ------------- ------------  ------------- -------------
Balance, 
  September 30, 1996       228,131   21,944,175   17,468,325     253,057       (994,695)    (482,612)    (6,027,206)   32,389,175
Allocation of shares by 
  Employees' Stock
  Ownership Plan                        121,277                                 150,098                                   271,375
Amortization of 
  compensation related 
  to Management Stock 
  Bonus Plan                             56,928                                              193,045                      249,973
Compensation related to 
  stock options granted                  51,447                                                                            51,447
Net income for the year 
  ended September 30, 
  1997                                             2,514,437                                                            2,514,437
Cash dividend paid 
  ($0.40 per share)                                 (677,675)                                                            (677,675)
Net change in unrealized 
  gain on available-for-
  sale investment 
  securities                                                     669,327                                                  669,327
Purchase of 164,355 
  treasury shares                                                                                        (3,222,729)   (3,222,729)
                         ---------- ------------ ------------ -----------  ------------- ------------  ------------- -------------
Balance, 
  September 30, 1997       228,131   22,173,827   19,305,087     922,384       (844,597)    (289,567)    (9,249,935)   32,245,330
Allocation of shares by
  Employees' Stock
  Ownership Plan                        175,691                                 151,878                                   327,569
Amortization of 
  compensation related 
  to Management Stock 
  Bonus Plan                            108,968                                              193,045                      302,013
Compensation related to 
  stock options granted                   7,658                                                                             7,658
Net income for the year 
  ended September 30,
  1998                                             2,363,798                                                            2,363,798
Cash dividend paid 
  ($0.60 per share)                                 (929,243)                                                            (929,243)
Net change in unrealized 
  gain on available-for-
  sale investment 
  securities                                                    (639,048)                                                (639,048)
Purchase of 360,707 
  treasury shares                                                                                        (8,654,310)   (8,654,310)
                         ---------- ------------ ------------ -----------  ------------- ------------  ------------- -------------
Balance, 
  September 30, 1998      $228,131  $22,466,144  $20,739,642    $283,336      ($692,719)    ($96,522)  ($17,904,245)  $25,023,767
                         ========== ============ ============ ===========  ============= ============  ============= =============
</TABLE>
The Notes to  Consolidated  Financial  Statements  are an integral part of these
statements.                           F - 4
<PAGE>


                            Landmark Bancshares, Inc.
                      Consolidated Statements of Cash Flows
             For the Years Ended September 30, 1998, 1997, and 1996
<TABLE>
<CAPTION>
                                                                    1998            1997            1996
                                                               ------------    ------------    ------------
<S>                                                           <C>             <C>             <C>         
CASH FLOWS FROM OPERATING ACTIVITIES
     Net income                                                $  2,363,798    $  2,514,437    $  1,404,226
     Adjustments to reconcile net income to net cash
         provided by operating activities:
            Depreciation                                            157,885         113,881         116,278
            Gain on sale of investment securities
              available-for-sale                                   (202,299)       (220,154)        (27,107)
            Decrease in accrued interest receivable                   2,758          72,035         152,435
            Decrease in outstanding checks in excess
              of bank balance                                                      (143,808)       (907,008)
            Increase (decrease) in income taxes                     (38,272)        170,652        (239,364)
            Increase (decrease) in accounts payable and
               accrued expenses                                    (567,513)        111,297       1,257,765
            Amortization of premiums and discounts
              on investments and loans                              (85,099)        (54,424)       (171,438)
            Amortization of mortgage servicing rights                50,692          15,329           2,202
            Provision for losses on loans                           265,000         307,979         134,743
            Sale of loans held-for-sale                          22,831,874      12,956,185       9,679,305
            Gain on sale of mortgage-backed securities
             available-for-sale                                                                    (135,208)
            Gain on sale of loans held-for-sale                    (472,908)       (237,281)        (82,208)
            Origination of loans held-for-sale                  (20,450,773)     (5,896,736)     (9,643,647)
            Purchase of loans held-for-sale                      (1,033,045)       (412,950)       (701,310)
            Amortization related to MSBP and ESOP                   344,923         343,143         329,923
            Other non-cash items, net                               105,714          47,773         290,933
                                                               ------------    ------------    ------------
Net cash provided by operating activities                         3,272,735       9,687,358       1,460,520
                                                               ------------    ------------    ------------
CASH FLOWS FROM INVESTING ACTIVITIES
     Repayment of loans, net of originations                     (1,076,137)     (4,345,234)    (14,007,163)
     Loans purchased for investment                             (16,852,563)    (30,958,686)    (16,398,206)
     Principal repayments on mortgage-backed securities          14,943,744       9,134,312      12,396,168
     Proceeds from sale of mortgage-backed securities
       available-for-sale                                                                        11,490,625
     Acquisition of mortgage-backed securities
       held-to-maturity                                                                          (1,482,865)
     Acquisition of investment securities held-to-maturity      (10,885,469)     (4,300,000)    (16,295,500)
     Acquisition of investment securities available-for-sale     (3,588,429)     (2,413,418)     (2,373,880)
     Acquisition of equity investment                              (250,000)
     Proceeds from sale of investment securities
       available-for-sale                                           647,553         742,989         308,479
     Proceeds from maturities or calls of investment
       securities held-to-maturity                               18,150,000      14,890,000      21,862,135
     Net (increase) decrease in time deposits                      (139,287)        369,369          99,051
     Proceeds from sale of foreclosed assets                        488,420         110,614         130,923
     Acquisition of fixed assets                                   (698,917)       (352,345)        (60,156)
     Other investing activity, net                                 (114,061)        (50,289)         36,111
                                                               ------------    ------------    ------------
Net cash provided by (used in) investing activities                 624,854     (17,172,688)     (4,294,278)
                                                               ------------    ------------    ------------

</TABLE>

The Notes to  Consolidated  Financial  Statements  are an integral part of these
statements.

                                      F-5
<PAGE>


                            Landmark Bancshares, Inc.

                Consolidated Statements of Cash Flows (Continued)
              For the Years Ended September 30, 1998, 1997 and 1996


<TABLE>
<CAPTION>

                                                                   1998             1997             1996
                                                             -------------    -------------    -------------
<S>                                                         <C>              <C>              <C>           
CASH FLOWS FROM FINANCING ACTIVITIES
    Net increase (decrease) in deposits                      $  10,058,177    $     919,829    ($  1,142,174)
    Net increase (decrease) in escrow accounts                     231,113              (85)         332,986
    Proceeds from FHLB advances and other borrowings            31,700,000      126,600,000       53,600,000
    Repayment of FHLB advances and other borrowings            (36,200,000)    (113,866,668)     (45,666,666)
    Purchase of treasury stock                                  (8,654,310)      (3,222,729)      (3,526,306)
    Dividends paid                                                (929,243)        (677,675)        (752,393)
                                                             -------------    -------------    -------------

Net cash provided by (used in) financing activities             (3,794,263)       9,752,672        2,845,447
                                                             -------------    -------------    -------------
Net increase in cash and cash equivalents                          103,326        2,267,342           11,689

Cash and cash equivalents at beginning of year                   2,741,052          473,710          462,021
                                                             -------------    -------------    -------------

Cash and cash equivalents at end of year                     $   2,844,378    $   2,741,052    $     473,710
                                                             =============    =============    =============


SUPPLEMENTAL DISCLOSURES
    Cash paid during the year for:
     Interest on deposits, advances and other
       borrowings                                            $   9,899,846    $   9,895,246    $   8,519,955

     Income taxes                                                1,382,903          954,195        1,018,956

    Transfers from loans to foreclosed real estate                 377,107          489,475           27,411

    Loans to facilitate the sale of foreclosed assets              325,814          122,000           25,954

    Transfer of held-to-maturity mortgage-backed
      securities to available-for-sale                                   -                -       11,355,417

    Transfer of loans held for investment to held-for-sale       2,827,880        5,155,392                -

</TABLE>



The Notes to  Consolidated  Financial  Statements  are an integral part of these
statements.

                                      F-6
<PAGE>


                            Landmark Bancshares, Inc.

                   Notes to Consolidated Financial Statements
                        September 30, 1998, 1997 and 1996


1.      Summary of Significant Accounting Policies

        Nature of operations:
        Landmark  Bancshares,  Inc. (the Company) is a Kansas corporation and is
        the parent  company of its  wholly-owned  subsidiary,  Landmark  Federal
        Savings  Bank (the Bank).  At the  present  time,  the Company  does not
        conduct any active business other than the Bank.

        Landmark  Federal  Savings  Bank  is  primarily  engaged  in  attracting
        deposits from the general public and using those deposits, together with
        other  funds,  to  originate  real estate  loans on one- to four- family
        residences,  commercial  and  consumer  loans.  The  Bank  conducts  its
        business  from its main  office in Dodge  City and also has five  branch
        offices located in Dodge City,  Garden City, Great Bend,  Hoisington and
        LaCrosse,  Kansas.  The Bank also has a loan  origination  office in the
        Kansas  City area.  In  addition,  the Bank  invests in  mortgage-backed
        securities  and  investment  securities.  The Bank offers its  customers
        fixed rate and adjustable  rate mortgage  loans, as well as other loans,
        including commercial, auto, home equity and savings account loans.

        Principles of consolidation:
        The accompanying  consolidated financial statements include the accounts
        of Landmark Bancshares,  Inc. and its wholly-owned subsidiary,  Landmark
        Federal Savings Bank. Significant intercompany transactions and balances
        have been eliminated.

        Use of estimates:
        The  preparation  of financial  statements in conformity  with generally
        accepted accounting principles requires management to make estimates and
        assumptions  that affect the reported  amounts of assets and liabilities
        and disclosure of contingent  assets and  liabilities at the date of the
        financial  statements and the reported  amounts of revenues and expenses
        during the reporting period.  Actual results could differ  significantly
        from those estimates.

        Material  estimates  that are  particularly  susceptible  to significant
        change in the near-term relate to the determination of the allowance for
        loan losses and the  valuation  of assets  acquired in  connection  with
        foreclosures  or in  satisfaction  of  loans.  In  connection  with  the
        determination  of the  allowances  for loan losses and the  valuation of
        assets  acquired  by   foreclosure,   management   obtains   independent
        appraisals for significant properties.

        Management  believes  that  the  allowances  for  losses  on  loans  and
        valuations  of  assets   acquired  by   foreclosure   are  adequate  and
        appropriate.  While  management uses available  information to recognize
        losses on loans and assets acquired by  foreclosure,  future loss may be
        accruable based on changes in economic conditions. In addition,  various
        regulatory  agencies,  as an integral part of their examination process,
        periodically  review  the  Bank's  allowances  for  losses  on loans and
        valuations of assets acquired by foreclosure.  Such agencies may require
        the Bank to  recognize  additional  losses  based on their  judgment  of
        information available to them at the time of their examination.

                                      F-7
<PAGE>

1.      Summary of Significant Accounting Policies (Continued)

        Cash and cash equivalents:
        Cash and cash  equivalents  include  unrestricted  cash on hand,  demand
        deposits  maintained  in  depository   institutions  and  other  readily
        convertible investments with original maturities when purchased of three
        months or less. All time deposits in other  depository  institutions are
        treated as non-cash equivalents.

        Investment and mortgage-backed securities:
        Regulations  require the Bank to maintain  liquidity  for  maturities of
        deposits and other  short-term  borrowings in cash, U.S.  Government and
        other approved securities.

        Investments,  including  mortgage-backed  securities,  are classified as
        either     held-to-maturity,     trading,     or     available-for-sale.
        Held-to-maturity  securities  are  securities for which the Bank has the
        positive  intent and  ability to hold to  maturity  and are  reported at
        amortized cost.  Trading  securities are securities held principally for
        resale and are reported at fair value, with unrealized  changes in value
        reported  in  the  bank's   income   statement   as  part  of  earnings.
        Available-for-sale  securities  are securities not classified as trading
        nor as held-to-maturity  securities and are also reported at fair value,
        but any unrealized appreciation or depreciation,  net of tax effects are
        reported as a separate component of equity.

        In accordance with the provisions of the Financial  Accounting Standards
        Board A Guide to  Implementation  of  Statement  115 on  Accounting  for
        Certain  Investments  in Debt and Equity  Securities  (the  Guide),  the
        management of the Company in December of 1995 transferred $11,355,417 of
        mortgage-backed  securities  from  held-to-maturity   classification  to
        available-for-sale classification. These securities were sold subsequent
        to the transfer. The transfer was a one-time transaction as provided for
        in the Guide in an effort to restructure and enhance the yield and  rate
        sensitivity of the Company's portfolio of held-to-maturity securities.

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

        Gains  and  losses  on  the  sale  of  investment  and   mortgage-backed
        securities are determined using the specific-identification  method. All
        sales are made without recourse.

        Loans receivable:
        Loans  receivable that management has intent and ability to hold for the
        foreseeable  future or until  maturity or pay-off are  reported at their
        outstanding  principal balances,  net of undisbursed loan proceeds,  the
        allowance  for loan  losses,  any deferred  fees or costs on  originated
        loans and unamortized premiums or discounts on purchased loans.

        The  allowance  for loan  losses is  increased  by charges to income and
        decreased by  charge-offs  (net of  recoveries).  Management's  periodic
        evaluation  of the adequacy of the allowance is based on the Bank's past
        loan loss experience, known and inherent risks in the portfolio, adverse
        situations  that  may  affect  the  borrower's  ability  to  repay,  the
        estimated  value of any  underlying  collateral,  the  current  level of
        non-performing assets and current economic conditions.

        Premiums and  discounts on purchased  residential  real estate loans are
        amortized  to  income  using  the  interest  method  over the  estimated
        remaining period to maturity.

                                      F-8
<PAGE>

1.      Summary of Significant Accounting Policies (Continued)

        Loan  origination  fees and certain  direct  costs are  capitalized  and
        recognized as an adjustment of the yield of the related loan.

        The  accrual of  interest  on  impaired  loans is  discontinued  when in
        management's  opinion,  the borrower  may be unable to meet  payments as
        they become  due.  When  interest  accrual is  discontinued,  all unpaid
        accrued interest is reversed. Interest income is subsequently recognized
        only to the extent cash payments are received.

        Loans held-for-sale:
        Mortgage loans  originated and intended for sale in the secondary market
        are  carried  at the  lower  of cost or  estimated  market  value in the
        aggregate.  Net  unrealized  losses are  recognized  through a valuation
        allowance by charges to income.

        Foreclosed assets:
        Real estate properties  acquired through, or in lieu of, foreclosure are
        to be sold  and are  initially  recorded  at fair  value  at the date of
        foreclosure  establishing a new cost basis.  Valuations are periodically
        performed by management, and an allowance for losses is established by a
        charge to  operations  if the carrying  value of a property  exceeds the
        fair value less  estimated  costs to sell.  Revenue  and  expenses  from
        operations  and changes in the valuation  allowance are included in gain
        or loss on foreclosed real estate. The historical average holding period
        for such property is approximately six months.

        Mortgage servicing rights:

        In  June  1996,  the  Financial  Accounting  Standard  Board issued FASB
        Statement  No. 125,  Accounting for Transfers and Servicing of Financial
        Assets  and   Extinguishments  of  Liabilities.  FASB Statement No. 127,
        Deferral  of  the Effective Date of Certain Provisions of FASB Statement
        No. 125, was  issued  in December  1996 to defer  certain  provisions of
        Statement  125.  The  provisions  of  FASB  No.  125  for  servicing  of
        financial assets have been applied effective January 1, 1997.

        The cost of mortgage servicing rights is amortized in proportion to, and
        over the period of,  estimated  net  servicing  revenues.  Impairment of
        mortgage  servicing  rights is assessed based on the fair value of those
        rights. Fair values are estimated using discounted cash flows based on a
        current market interest rate. For purposes of measuring impairment,  the
        rights are stratified based on loan type,  investor type,  interest rate
        and the life of the loan (15, 20 and 30 years) at the date of sale.  The
        amount of impairment  recognized is the amount by which the  capitalized
        mortgage servicing rights for a stratum exceed their fair value.

        Rights to  future  interest  income  from  serviced  loans  that  exceed
        contractually  specified  servicing fees are classified as interest-only
        strips and accounted for as debt securities that are available-for-sale.
        The Company held no such assets at September 30, 1998 and 1997.

        Prior the  implementation  of SFAS 125, excess servicing fees receivable
        were amortized over the estimated  life using the interest  method.  The
        excess  servicing  fees  receivable  and the  amortization  thereon  was
        periodically  evaluated  in relation to estimated  future net  servicing
        revenues,  taking into consideration  changes in interest rates, current
        prepayment  rates and expected future cash flows. The Bank evaluated the
        carrying  value of the excess  servicing  receivables  by estimating the
        future net servicing income of the excess servicing  receivable based on
        management's best estimate of remaining loan lives.


                                      F-9
<PAGE>

1.      Summary of Significant Accounting Policies (Continued)

        Financial instruments:
        All derivative  financial  instruments  previously held or issued by the
        Company were held or issued for purposes other than trading. The Company
        did not hold or issue any derivative  financial  instruments  during the
        years ended September 30, 1998, 1997 and 1996.

        Off-balance sheet instruments:
        In the ordinary course of business the Bank has entered into off-balance
        sheet financial instruments  consisting of commitments to extend credit,
        commitments  under  credit  card  arrangements,  commercial  letters  of
        credit,  and standby letters of credit.  Such financial  instruments are
        recorded  in the  financial  statements  when they are funded or related
        fees are incurred or received.

        Office properties and equipment:
        Office  properties  and  equipment  are stated at cost less  accumulated
        deprecation.  Depreciation  is  computed  on a  straight-line  basis  or
        accelerated  methods  over the  estimated  useful lives of five to fifty
        years for  buildings  and  improvements  and  three to twenty  years for
        furniture, fixtures, equipment and automobiles.

        Income taxes:
        Deferred tax assets and liabilities  are reflected at currently  enacted
        income  tax rates  applicable  to the period in which the  deferred  tax
        assets or liabilities are expected to be realized or settled. As changes
        in tax laws or rates are enacted,  deferred  tax assets and  liabilities
        are adjusted through the provision for income taxes.

        Stock-based compensation:
        In  October  1995,  the  FASB  issued  SFAS  No.  123,   Accounting  for
        Stock-Based Compensation.  This Statement establishes a fair-value-based
        method of accounting  for stock  compensation  plans with  employees and
        others.  It applies to all  arrangements  under which employees  receive
        shares of stock or other  equity  instruments  of the  employer,  or the
        employer  incurs  liabilities to employees in amounts based on the price
        of the employer's  stock.  The Company has adopted the  recognition  and
        measurement  provisions  of SFAS No. 123  effective  for the fiscal year
        beginning  October 1, 1996.  SFAS No. 123  effects the  Company's  stock
        options granted after October 1, 1996.  These options are recognized and
        measured in accordance with the fair-value-based method of accounting.

        Impact of new accounting standards:
        In June 1997,  the FASB  issued SFAS No.  130,  Reporting  Comprehensive
        Income.  SFAS 130  establishes  standards of  disclosure  and  financial
        statement  display  for  reporting  total  comprehensive  income and the
        individual  components  thereof.  This Statement requires that all items
        that  are  required  to be  recognized  under  accounting  standards  as
        components of comprehensive  income be reported in a financial statement
        that  is  displayed  with  the  same   prominence  as  other   financial
        statements.  This  Statement  requires that an  enterprise  (a) classify
        items of other  comprehensive  income  by their  nature  in a  financial
        statement and (b) display the accumulated balance of other comprehensive
        income separately from retained earnings and additional  paid-in capital
        in the  equity  section  of a  statement  of  financial  position.  This
        Statement is effective  for fiscal years  beginning  after  December 15,
        1997.  Reclassification  of  financial  statements  for earlier  periods
        provided for comparative  purposes is required.  SFAS No. 130 provisions
        are only of a disclosure nature and at present the only significant item
        having an impact on the Company's financial  statements is the inclusion
        of unrealized gain or loss, net of tax, on available-for-sale securities
        as a component of comprehensive  income.  Management of the Company will
        adopt the provisions of this statement effective October 1, 1998.


                                      F-10
<PAGE>

1.      Summary of Significant Accounting Policies (Continued)

        FASB  issued  Statement  No.  131,  Disclosures  about  Segments  of  an
        Enterprise and Related  Information,  in June 1997. SFAS 131 establishes
        new standards for  determining a reportable  segment and for  disclosing
        information  regarding each such segment. This Statement requires that a
        public business enterprise report financial and descriptive  information
        about  its  reportable   operating  segments.   Operating  segments  are
        components of an enterprise about which separate  financial  information
        is available that is evaluated regularly by the chief operating decision
        maker  in  deciding   how  to  allocate   resources   and  in  assessing
        performance.  This Statement requires that a public business  enterprise
        report a measure of segment profit or loss, certain specific revenue and
        expense  items,  and segment  assets.  However,  this Statement does not
        require an  enterprise  to report  information  that is not prepared for
        internal use if reporting it would be  impracticable.  Statement  131 is
        effective for financial  statements for periods beginning after December
        15, 1997. In the initial year of  application,  comparative  information
        for earlier years is to be restated. SFAS No. 131 provisions are only of
        a  disclosure  nature  and the  Company  currently  does  not  have  any
        components that would be considered separate operating segments.

        In February 1998, FASB issued Statement No. 132, Employers'  Disclosures
        about  Pensions  and Other  Postretirement  Benefits.  SFAS 132  revises
        employers'  disclosures about pension and other  postretirement  benefit
        plans. It does not change the measurement or recognition of those plans.
        It  standardizes  the  disclosure  requirements  for  pensions and other
        postretirement  benefits to the extent practicable,  requires additional
        information  on changes in the  benefit  obligations  and fair values of
        plan assets that will  facilitate  financial  analysis,  and  eliminates
        certain  disclosures that are no longer as useful as they were when FASB
        Statements  No. 87, 88 and 106 were issued.  The  Statement is effective
        for fiscal years beginning  after December 15, 1997 earlier  application
        is  encouraged.  SFAS No.  132 will not have a  material  effect  on the
        Company's financial statements. Management of the Company will adopt the
        provisions of this statement effective October 1, 1998.

        In  June  1998,  FASB  issued  SFAS  No.  133  entitled  Accounting  for
        Derivative  Instruments and Hedging Activities.  This statement requires
        the recognition of all derivative financial instruments as either assets
        or liabilities in the statement of financial position and measurement of
        those  instruments  at fair value.  The  accounting for gains and losses
        associated with changes in the fair value of a derivative and the effect
        on the  consolidated  financial  statements  will  depend  on its  hedge
        designation  and  whether  the hedge is highly  effective  in  achieving
        offsetting  changes  in the  fair  value or cash  flows of the  asset or
        liability hedged.  Under the provisions of SFAS No. 133, the method that
        will be used for assessing the effectiveness of a hedging derivative, as
        well as the measurement approach for determining the ineffective aspects
        of the hedge,  must be  established  at the inception of the hedge.  The
        methods must be consistent with the entity's approach to managing risk.

        SFAS No.  133 is  effective  for all  fiscal  quarters  of fiscal  years
        beginning  after  June 15,  1999,  with  initial  application  as of the
        beginning  of  an  entity's  fiscal  quarter;   on  that  date,  hedging
        relationships  must be designated  anew and  documented  pursuant to the
        provisions of this Statement.  Earlier application is encouraged, but is
        permitted only as of the beginning of any fiscal quarter beginning after
        June 15, 1999. Retroactive  application to financial statements of prior
        periods is prohibited.  Management of the Company has not determined the
        quarter in which to adopt the  provisions of this statement and does not
        believe that such adoption will have a material  effect on the Company's
        financial position, liquidity or results of operations.


                                      F-11
<PAGE>


1.      Summary of Significant Accounting Policies (Continued)

        Earnings per share:
        The Company  adopted the provisions of SFAS No. 128,  entitled  Earnings
        Per Share  effective  December 15, 1997, and  accordingly,  restated all
        prior  period  earnings  per share to conform  with SFAS No.  128.  This
        statement  requires dual presentation with equal prominence of basic and
        diluted  earnings per share (EPS) for income from continuing  operations
        and for net income on the face of the income  statement for all entities
        with complex  capital  structures and requires a  reconciliation  of the
        numerator and  denominator of the basic EPS computation to the numerator
        and  denominator  of the diluted  EPS  computation.  Basic EPS  excludes
        dilution  and  is  computed  by  dividing  income  available  to  common
        stockholders by the weighted-average number of common shares outstanding
        for the period.  Diluted EPS reflects the potential  dilution that could
        occur if  securities  or other  contracts  to issue  common  stock  were
        exercised or converted  into common stock or resulted in the issuance of
        common stock that then shared in the earnings of the entity. See Note 12
        for additional information.

        Financial statement presentation:
        Certain items in prior year financial  statements have been reclassified
        to conform to the 1998 presentation.

2.      Investment Securities

        The amortized cost and estimated market values of investment  securities
        at September 30 are summarized as follows:

<TABLE>
<CAPTION>
                                                  September 30, 1998
                                -----------------------------------------------------
                                                 Gross        Gross        Estimated
                                 Amortized     Unrealized   Unrealized       Market
                                   Cost          Gains        Losses          Value
                                -----------   -----------   -----------   -----------
<S>                             <C>           <C>           <C>           <C>        
Held-to-maturity:
 Government Agency Securities   $10,000,433   $    57,975   $         -   $10,058,408
 Municipal Obligations            1,575,000        47,736                   1,622,736
                                -----------   -----------   -----------   -----------
                                $11,575,433   $   105,711   $         -   $11,681,144
                                ===========   ===========   ===========   ===========

Available-for-sale:
 Common Stock                   $ 5,337,064   $ 1,056,107   $   592,761   $ 5,800,410
 Stock in Federal Home Loan
   Bank, at cost                  3,210,500                                 3,210,500
 Corporate Bonds                    200,000                                   200,000
 Other                               10,000                                    10,000
                                -----------   -----------   -----------   -----------
                                $ 8,757,564   $ 1,056,107   $   592,761   $ 9,220,910
                                ===========   ===========   ===========   ===========
</TABLE>


                                      F-12

<PAGE>


2.      Investment Securities (Continued)
<TABLE>
<CAPTION>

                                                   September 30, 1997
                                -----------------------------------------------------
                                                 Gross        Gross       Estimated
                                 Amortized     Unrealized   Unrealized      Market
                                    Cost         Gains        Losses        Value
                                -----------   -----------   -----------   -----------
<S>                            <C>           <C>           <C>           <C>        
Held-to-maturity:
 Government Agency Securities   $17,297,942   $    85,039   $    42,512   $17,340,469
 Municipal Obligations            1,540,000        28,908         1,992     1,566,916
                                -----------   -----------   -----------   -----------
                                $18,837,942   $   113,947   $    44,504   $18,907,385
                                ===========   ===========   ===========   ===========

Available-for-sale:
 Common Stock                   $ 2,578,390   $ 1,508,395   $         -   $ 4,086,785
 Stock in Federal Home Loan
   Bank, at cost                  2,976,000                                   2,976,000
 Corporate Bonds                     50,000                                      50,000
 Other                               10,000                                      10,000
                                -----------   -----------   -----------   -----------
                                $ 5,614,390   $ 1,508,395   $         -   $ 7,122,785
                                ===========   ===========   ===========   ===========
</TABLE>

        Government  agency  securities  above  include bonds and notes issued by
        various  government  agencies.  Those  agencies  include the  following:
        Federal Farm Credit,  Fannie Mae,  Freddie Mac, Sallie Mae, Federal Home
        Loan  Bank,  Resolution  Trust  Corporation,  and the  Tennessee  Valley
        Authority.

        Federal Home Loan Bank members are required to maintain an investment in
        stock at an amount equal to a percentage of outstanding  home loans. For
        disclosure  purposes such stock, which is carried at cost, is assumed to
        have a market value that is equal to cost.

        The  amortized  cost and  estimated  market value of debt  securities by
        contractual maturity as of September 30, 1998 are shown below.  Expected
        maturities will differ from contractual maturities because borrowers may
        have the right to call or prepay  obligations  with or  without  call or
        prepayment penalties.  The equity securities have been excluded from the
        maturity  table below  because they do not have  contractual  maturities
        associated with debt securities.

<TABLE>
<CAPTION>

                                                      September 30, 1998
                                         ------------------------------------------------------
                                             Held-to-Maturity           Available-for-Sale
                                         -------------------------   --------------------------

                                          Amortized    Estimated      Amortized     Estimated
                                             Cost     Market Value      Cost       Market Value
                                         -----------   -----------   -----------   -----------
<S>                                      <C>           <C>           <C>           <C>        
Due in one year or less                  $ 2,000,000   $ 2,000,104   $         -   $         -
Due after one year through five years      1,740,000     1,761,903
Due after five years through ten years     7,835,433     7,919,137       150,000       150,000
Due after ten years                                                       50,000        50,000
                                         -----------   -----------   -----------   -----------
                                         $11,575,433   $11,681,144   $   200,000   $   200,000
                                         ===========   ===========   ===========   ===========
</TABLE>




                                      F-13

<PAGE>



2.      Investment Securities (Continued)

        Gross  realized  gains and  (losses) on sales of  investment  securities
        during the years ended September 30 are as follows:

                                         1998       1997       1996      
                                        --------   --------   --------
       Available-for-sale securities:
            Realized gains              $202,299   $220,154   $ 27,107
            Realized losses                    -          -          -
                                        --------   --------   --------
                                        $202,299   $220,154   $ 27,107
                                        ========   ========   ========

        Proceeds  from sales of  available-for-sale  securities  were  $647,553,
        $742,989 and $308,479 for the years ended  September 30, 1998,  1997 and
        1996, respectively.  During the years ended September 30, 1998, 1997 and
        1996,   sales   consisted  of  common   stock  of  unrelated   financial
        corporations.

        Investment   securities   with  a  carrying  amount  of  $9,200,000  and
        $2,000,000 as of September 30, 1998 and 1997, respectively, were pledged
        as collateral for public funds as discussed in Note 9.

3.      Mortgage-Backed Securities

        Mortgage-backed  securities,  all of which were classified as   held-to-
        maturity  at September 30, 1998 and 1997, consist of the following:

<TABLE>
<CAPTION>
                                           September 30, 1998
                               -----------------------------------------------------
                                                Gross        Gross        Estimated
                                Amortized     Unrealized   Unrealized       Market
                                  Cost          Gains        Losses         Value
                               -----------   -----------   -----------   -----------

<S>                           <C>           <C>           <C>           <C>        
GNMA - fixed rate              $   229,898   $     6,711   $         -   $   236,609
FNMA - ARMs                      8,841,621       134,117         4,066     8,971,672
FHLMC - ARMs                     2,814,514        44,772           845     2,858,441
FHLMC - fixed rate                 128,174         2,905                     131,079
FNMA - fixed rate                  448,123        28,827                     476,950
Collateralized mortgage
  obligations-government
  agency issue                   7,058,687        67,667         2,432     7,123,922
Collateralized mortgage
  obligations-private issues     2,202,738         7,108         1,549     2,208,297
                               -----------   -----------   -----------   -----------
                               $21,723,755   $   292,107   $     8,892   $22,006,970
                               ===========   ===========   ===========   ===========
</TABLE>



                                      F-14


<PAGE>


3.      Mortgage-Backed Securities (Continued)

<TABLE>
<CAPTION>
                                                   September 30, 1997
                               -----------------------------------------------------
                                                Gross        Gross       Estimated
                                Amortized     Unrealized   Unrealized      Market
                                  Cost          Gains        Losses        Value
                               -----------   -----------   -----------   -----------
<S>                            <C>           <C>           <C>           <C>        
GNMA - fixed rate              $   373,311   $    13,200   $         0   $   386,511
FNMA - ARMs                     13,157,644       190,254        25,145    13,322,753
FHLMC - ARMs                     4,768,042       114,215         2,003     4,880,254
FHLMC - fixed rate                 245,443         6,035           740       250,738
FNMA - fixed rate                  589,777        24,017                     613,794
Collateralized mortgage
  obligations-government
  agency issue                  13,310,277        38,128        70,443    13,277,962
Collateralized mortgage
  obligations-private issues     4,245,057         6,425        49,719     4,201,763
                               -----------   -----------   -----------   -----------
                              $36,689,551   $   392,274   $   148,050   $36,933,775
                               ===========   ===========   ===========   ===========
</TABLE>

        Collateralized  mortgage  obligations consist of floating rate and fixed
        rate notes with varying contractual principal  maturities.  The Bank has
        no principal only,  interest only, or residual  collateralized  mortgage
        obligations.

        Proceeds  from sales of  mortgage-backed  securities  available-for-sale
        were $0, $0, and  $11,490,625  for years ended  September 30, 1998, 1997
        and 1996,  respectively.  Sales for the year ended  September  30,  1996
        consisted  of  mortgage-backed  securities  that were  transferred  from
        held-to-maturity   to   available-for-sale   in  December  1995.   These
        securities were transferred in accordance with the one-time  transaction
        allowed  under the FASB  Implementation  Guide,  see Note 1 for  further
        discussion.

        Gross realized gains and (losses) on sales of mortgage-backed securities
        during the years ended September 30 are as follows:

                               1998        1997       1996    
                             --------    --------   --------
           
           Realized gains    $      -    $      -   $144,885
           Realized losses                            (9,677)
                             --------    --------   --------
           
                             $      -    $      -   $135,208
                             ========    ========   ========
           



        Mortgage-backed  securities with a carrying  amount  of $17,352,579  and
        $9,067,094 at September 30, 1998 and 1997, respectively, were pledged as
        collateral for public funds as discussed in Note 9.

                                      F-15

<PAGE>


4.      Loans Receivable

        Loans receivable at September 30, are summarized as follows:

<TABLE>
<CAPTION>
                                                                September 30,
                                                        ------------------------------
                                                            1998             1997
                                                        -------------    -------------
<S>                                                    <C>              <C>          
Real estate loans:
       Residential                                      $ 129,688,030    $ 125,470,688
       Construction                                         1,386,224        1,936,517
       Commercial                                           4,936,897        2,666,395
       Second mortgage                                     10,071,744        9,986,176
Commercial business                                         8,578,694        4,049,950
Consumer                                                   19,049,741       14,850,445

Gross loans                                               173,711,330      158,960,171
                                                       -------------    -------------

Less:  Net deferred loan fees, premiums and discounts        (250,323)        (318,945)
          Allowance for loan losses                        (1,136,753)        (968,623)
                                                        -------------    -------------
Total loans, net                                        $ 172,324,254    $ 157,672,603
                                                        =============    =============

</TABLE>

        The  following is an analysis of the change in the allowance for loss on
        loans:

                                      1998           1997           1996
                                  -----------    -----------    -----------

Balance, beginning                $   968,623    $   740,346    $   643,547
Provision charged to operations       265,000        307,979        134,743
Loans charged off                    (107,070)       (92,243)       (38,631)
Recoveries                             10,200         12,541            687
                                  -----------    -----------    -----------
Balance, ending                   $ 1,136,753    $   968,623    $   740,346
                                  ===========    ===========    ===========


        Impairment of loans having recorded investments of $505,547 at September
        30, 1998 and  $371,769 at  September  30, 1997 have been  recognized  in
        conformity with FASB Statement No. 114, as amended by FASB Statement No.
        118. The average recorded  investment in impaired loans during the years
        ended   September   30,  1998  and  1997  was  $438,658  and   $249,450,
        respectively.  Allowances  for loss on these  loans are  included in the
        above analysis of the overall allowance for loss on loans.  There are no
        specific loss provisions  associated with impaired loans as of September
        30, 1998 and 1997. Interest income on impaired loans of $31,803, $25,662
        and $8,460 was recognized for cash payments  received for the year ended
        September 30, 1998, 1997 and 1996, respectively.

        It is Bank policy not to modify  interest  rates below the then  current
        market rate on loans  associated with troubled debt  restructuring.  The
        Bank is not  committed to lend  additional  funds to debtors whose loans
        have been modified.

        See Note 19 for disclosure of loans to related parties.

                                      F-16
<PAGE>


5.      Mortgage Servicing Rights

        Mortgage loans serviced for others are not included in the  accompanying
        statements  of financial  condition.  The unpaid  principal  balances of
        these loans at September 30 are summarized as follows:

                                 1998          1997          1996      
                             -----------   -----------   -----------
           
           FHLMC             $58,336,823   $54,658,716   $52,343,707
           Other investors     1,809,812     1,108,734     1,396,481
                             -----------   -----------   -----------
           
                             $60,146,635   $55,767,450   $53,740,188
                             ===========   ===========   ===========

        Custodial  escrow  balances  maintained in connection with the foregoing
        loan  servicing  and  included in demand  deposits,  were  approximately
        $176,432 and $150,840 at September 30, 1998 and 1997.

        The following is an analysis of the changes in mortgage servicing rights
        during the year ended September 30, 1998 and 1997:
                                                          

                                     1998         1997      
                                  ---------    ---------
             
             Balance, beginning   $  96,199    $       -
             Additions              180,311      111,528
             Amortization           (50,675)     (15,329)
                                  ---------    ---------
             
             Balance, ending      $ 225,835    $  96,199
                                  =========    =========

        There were no mortgage  servicing rights capitalized or amortized during
        the year ended  September 30, 1996. No valuation  allowance was recorded
        against  mortgage  servicing  rights at September 30, 1998 and 1997. For
        the year ended September 30, 1996  amortization of excess servicing fees
        retained was $2,202.

6.      Accrued Income Receivable

        Accrued interest receivable at September 30 is summarized as follows:


             .                                1998         1997
                                          ----------   ----------
             
             Mortgage-backed securities   $  138,525   $  233,811
             Loans receivable              1,054,602      957,036
             Investments                     250,720      255,758
                                          ----------   ----------
             
                                          $1,443,847   $1,446,605
                                          ==========   ==========
             
7.      Foreclosed Assets

        Real estate owned or in judgment and other repossessed assets consist of
        the following:
  

                                                       September
                                                   -------------------

                                                     1998       1997
                                                   --------   --------
             
             Real estate acquired by foreclosure   $      -   $232,851
             Real estate loans in judgment
               and subject to redemption             56,589     19,099
             Other foreclosed assets                 14,350
                                                   --------   --------
                                                   $ 70,939   $251,950
                                                   ========   ========


                                      F-17
<PAGE>

7.      Foreclosed Assets (Continued)

        There was no activity in the allowance for loss account  for  the  years
        ended  September 30, 1998, 1997 and 1996.

8.      Office Properties and Equipment

        Office  properties  and  equipment  are stated at cost less  accumulated
        depreciation as follows:


                                                         September 30,      
                                                   -----------------------
        
                                                      1998         1997
                                                   ----------   ----------
        
        Land                                       $  298,366   $  298,366
        Office building and improvements            1,934,541    1,503,037
        Furniture, fixtures and equipment           1,163,365      927,977
        Automobiles                                    11,544        9,642
                                                   ----------   ----------
                                                    3,407,816    2,739,022
        Less accumulated depreciation               1,678,534    1,550,772
                                                   ----------   ----------
                                                   $1,729,282   $1,188,250
                                                   ==========   ==========
        Depreciation expense ($116,278 for 1996)   $  157,885   $  113,881
                                                   ==========   ==========



9.     Deposits




        Deposits at September 30 are summarized as follows:

                                            1998           1997
                                         ------------   ------------
       
        Demand  accounts:
             Interest-bearing            $ 17,131,980   $ 18,549,636
             Non-interest bearing           3,655,520      3,254,991
                                          ------------   ------------
        
                 Total demand accounts     20,787,500     21,804,627
        Savings deposits                    6,520,220      5,715,254
        Certificates of deposit           127,485,196    117,214,858
                                         ------------   ------------
                                         $154,792,916   $144,734,739
                                         ============   ============

        The  aggregate  amount of jumbo  certificates  of deposit with a minimum
        denomination  of  $100,000  as  of  September  30,  1998  and  1997  was
        approximately   $21,681,643  and  $11,174,463,   respectively.   Deposit
        accounts as of September 30, 1998 included  public funds of $13,902,580.
        Public  funds  were   collateralized   by  investment   securities   and
        mortgage-backed securities as discussed in Notes 2 and 3.

        At September 30, 1998,  scheduled  maturities of certificates of deposit
        are as follows:

                      Year Ending September 30,                   
          ---------------------------------------------------
          
                              1999                $ 88,891,755
                              2000                  30,914,111
                              2001                   4,537,539
                              2002                   1,449,876
                              2003                   1,691,915
                                       ------------------------
          
                                                  $127,485,196
                                       ========================
          

                                      F-18
<PAGE>


10.     Advances and other Borrowings from Federal Home Loan Bank

        Advances  and  other  borrowings  from  the  Federal  Home Loan Bank  at
        September 30 are  summarized as follows:


                                     1998          1997      
                                 -----------   -----------
                
                Advances         $33,700,000   $36,200,000
                Line of credit     8,000,000    10,000,000
                                 -----------   -----------
                
                                 $41,700,000   $46,200,000
                                 ===========   ===========




        Advances  and  other  borrowings  from the  Federal  Home  Loan  Bank at
        September 30 consist of the following:

                                  1998                        1997
    Fiscal         ------------------------------------------------------------
     Year                              Weighted                    Weighted
   Maturity              Amount       Average Rate    Amount        Average Rate
----------------   ----------------  ------------  ------------  --------------

           1998        $         -             %   $28,000,000          6.30 %
           1999         26,700,000        5.78      14,200,000          5.91
           2000          4,000,000        5.99       4,000,000          6.09
           2001
           2002
           2003          6,000,000        5.05
  Thereafter             5,000,000        4.99

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

                       $41,700,000        5.60 %   $46,200,000          6.16 %
                   ================  ============  ============  ==============

        At September  30, 1998 the Company had  $8,000,000  outstanding  under a
        $30,000,000  line of credit with the Federal Home Loan Bank. All amounts
        outstanding under the line of credit are payable on February 5, 1999 and
        bear interest at the line of credit rate established by the Federal Home
        Loan  Bank.  This rate is  adjusted  from  time to time,  the rate as of
        September  30,  1998 was 6.03%.  At  September  30, 1997 the Company had
        $10,000,000 outstanding under a $30,000,000 line of credit, due February
        5, 1998.

        The advances and line of credit are  collateralized  as of September 30,
        1998 and 1997 by a  blanket  pledge  agreement,  including  all stock in
        Federal  Home  Loan  Bank,  qualifying  first  mortgage  loans,  certain
        mortgage-related securities and other investment securities.

11.     Income Taxes

        The Company and subsidiary file consolidated federal income tax returns.
        The Company's effective income tax rate was different than the statutory
        federal income tax rate for the following reasons:





                                                      1998     1997     1996
                                                      ----   ------   ------

Statuatory federal income tax                         34.0 %   34.0 %   34.0 %
Increase (reductions) resulting from:
     Kansas Privilege Tax                              3.6      3.9      4.3
     Other                                             0.5      0.2     (2.6)
                                                     -----   ------   ------
                                                      38.1 %   38.1 %   35.7 %
                                                     =====   ======   ======


                                      F-19

<PAGE>

11.     Income Taxes (Continued)

        Deferred taxes are included in the accompanying  Statements of Financial
        Condition at September  30, 1998 and 1997 for the  estimated  future tax
        effects of  differences  between  the  financial  statement  and federal
        income  tax basis of assets  and  liabilities  given the  provisions  of
        currently enacted tax laws.

        The net deferred tax asset  (liability)  at September  30, 1998 and 1997
        were comprised of the following:

<TABLE>
<CAPTION>
                                                              1998           1997
                                                          -----------    -----------
<S>                                                      <C>            <C>        
Deferred tax asset:
       Deferred loan fees and costs                       $    24,091    $    37,087
       Allowance for loan losses                              418,780        369,723
       Deferred compensation and accrued salaries             139,101        126,777
       Equity investment in partnership                        32,797
       Accrued expenses                                        11,052
                                                          -----------    -----------
                                                              625,821        533,587
                                                          -----------    -----------

Deferred tax liabilities:
       Accumulated depreciation                                (1,566)        (4,545)
       Special bad debt deduction                            (230,120)      (298,034)
       FHLB stock dividends                                  (412,064)      (337,432)
       Investment basis                                       (12,141)
       Unrealized gain on available-for-sale securities      (180,010)      (586,011)
                                                          -----------    -----------
                                                             (835,901)    (1,226,022)
                                                          -----------    -----------
                                                          ($  210,080)   ($  692,435)
                                                          ===========    ===========
</TABLE>

                                                             
        No  valuation  allowance  was  recorded  against  deferred tax assets at
        September 30, 1998 or 1997.

        Prior to the year  ended  September  30,  1997,  the Bank was  allowed a
        special bad debt deduction  based on a percentage of taxable income (8%)
        or on  specified  experience  formulas,  subject to certain  limitations
        based upon aggregate loan balances at the end of the year. The Bank used
        the percentage of taxable income method in 1996.

        Effective with the tax year  beginning  October 1, 1996, the Bank was no
        longer able to use the  percentage of taxable income method and began to
        recapture tax bad debt reserves of $936,968 over a six year period.  The
        reserves to be recaptured  consist of bad debt deductions after December
        31, 1987.  If the amounts  deducted  prior to December 31, 1987 are used
        for purposes other than for loan losses,  such as in a  distribution  in
        liquidation  or  otherwise,  the  amounts  deducted  would be subject to
        federal income tax at the then current  corporate tax rate. The Bank had
        recorded a deferred tax asset  related to the  allowance for loan losses
        reported for financial  reporting  purposes and a deferred tax liability
        for special bad debt  deductions  after  December 31, 1987. The Bank, in
        accordance  with SFAS No. 109, has not recorded a deferred tax liability
        of  approximately  $1,900,000  related to  approximately  $5,585,000  of
        cumulative special bad debt deductions prior to December 31, 1987.


<PAGE>



12.     Earnings Per Share

        The following is a reconciliation  of the numerators and denominators of
        the basic and diluted per share computations for income:
<TABLE>
<CAPTION>
                                                          
                                                   Income           Shares      Per Share
                                                  Numerator)     (Denominator)   Amount
                                                  -----------    -------------   -------
<S>                                              <C>               <C>           <C>  
Year ended September 30, 1998:
Basic EPS
     Income available to common stockholders      $2,363,798        1,518,482     $1.56
                                                                                 =======
Effect of dilutive securities
     MSBP shares                                                        6,366
     Stock options                                                    140,102
                                                  -----------    -------------
                                                  $2,363,798        1,664,950     $1.42
                                                  ===========    =============   =======

Year ended September 30, 1997:
Basic EPS
     Income available to common stockholders      $2,514,437        1,652,339     $1.52
                                                                                 =======
Effect of dilutive securities
     MSBP shares                                                        9,967
     Stock options                                                    111,815
                                                  -----------    -------------
                                                  $2,514,437        1,774,121     $1.42
                                                  ===========    =============   =======

Year ended September 30, 1996:
Basic EPS
     Income available to common stockholders      $1,404,226        1,810,182     $0.78
                                                                                 =======
Effect of dilutive securities
     MSBP shares                                                        9,402
     Stock options                                                     72,860
                                                  -----------    -------------
                                                  $1,404,226        1,892,444     $0.74
                                                  ===========    =============   =======
</TABLE>

        As discussed in Note 1, the Company  adopted SFAS No. 128,  Earnings Per
        Share,  effective for the year ended  September 30, 1998.  The Statement
        requires  restatement  of  all  prior-period  earnings  per  share  data
        presented. The following is the EPS data as originally presented:
                                                           
                                              1997            1996
                                            ---------   -------------

Primary:
       Earnings per share                   $    1.40   $        0.72
                                            =========   =============

       Weighted average common and common
          shares outstanding                1,800,585       1,937,820
                                            =========   =============

Fully diluted:
       Earnings per share                   $    1.37   $        0.72
                                            =========   =============

       Weighted average common and common
          shares outstanding                1,832,882       1,953,774
                                            =========   =============

                                      F-21

<PAGE>

13.     Regulatory Matters

        The  Bank  is  subject  to  various  regulatory   capital   requirements
        administered  by the federal banking  agencies.  Failure to meet minimum
        capital  requirements  can  initiate  certain  mandatory--and   possibly
        additional  discretionary--actions  by regulators  that, if  undertaken,
        could have a direct material effect on the Bank's financial  statements.
        Under  capital  adequacy  guidelines  and the  regulatory  framework for
        prompt corrective action, the Bank must meet specific capital guidelines
        that involve  quantitative  measures of the Bank's assets,  liabilities,
        and certain  off-balance  sheet  items as  calculated  under  regulatory
        accounting practices.  The Bank's capital amounts and classification are
        also  subject  to  qualitative   judgments  by  the   regulators   about
        components, risk weightings, and other factors.

        Quantitative  measures  established  by  regulation  to  ensure  capital
        adequacy  require the Bank to maintain  minimum  amounts and ratios (set
        forth in the table  below) of core and  tangible  capital (as defined in
        the  regulations)  to assets (as defined) and core and total  capital to
        risk weight assets (as defined).  Management  believes,  as of September
        30, 1998, that the Bank meets all capital adequacy requirements to which
        it is subject.

        As of September 30, 1998, the most recent  notification  from the Office
        of Thrift  Supervision  (OTS)  categorized the Bank as well  capitalized
        under the  regulatory  framework  for prompt  corrective  action.  To be
        categorized  as well  capitalized  the Bank must maintain  minimum total
        risk-based,  Tier I risk-based,  and Tier I leverage ratios as set forth
        in the table.  There are no conditions or events since that notification
        that management believes have changed the Bank's category.

        The Bank's actual  capital  amounts (in  thousands)  and ratios are also
        presented in the following table:

<TABLE>
<CAPTION>

                                                                                 To Be Well
                                                                              Capitalized Under
                                                          For Capital         Prompt Corrective
                                         Actual         Adequacy Purposes:    Action Provisions:
                                  -------------------   ------------------    -------------------
                                    Amount     Ratio       Amount  Ratio       Amount      Ratio   
                                  ---------   -------     -------  ------     --------    ------- 
<S>                               <C>         <C>       <C>         <C>      <C>          <C>    
As of September 30, 1998:                                                     
Total (Risk-Based) Capital                                                    
     (to Risk Weighted Assets)     $17,725     14.4%     $ 9,825     8.0%     $12,282      10.0%  
Core (Tier I) Capital                                                         
     (to Risk Weighted Assets)      16,589     13.5%         N/A                7,369       6.0%
Core (Tier I) Capital - leverage                                              
     (to Assets)                    16,589      7.4%       8,917     4.0%      11,158       5.0%
                                                                              
As of September 30, 1997:                                                     
Tangible Capital (to Assets)       $26,895     12.0%     $ 3,349     1.5%     $   N/A
Total (Risk-Based) Capital                                                    
     (to Risk Weighted Assets)      27,864     25.8%       8,627     8.0%      10,784      10.0%
Core (Tier I) Capital                                                         
     (to Risk Weighted Assets)      26,895     24.9%         N/A                6,470       6.0%
Core (Tier I) Capital - leverage                                              
     (to Assets)                    26,895     12.0%       6,698     3.0%      11,168       5.0%
</TABLE>
                                                                              
                                                                              
                                                                              
                                      F-22                                

<PAGE>


13.     Regulatory Matters (Continued)

        The following is a reconciliation of net worth to regulatory  capital as
        reported  in  the  September 30, 1998 and 1997 reports to the Office  of
        Thrift Supervision:
                                                           
                                                       September 30,
                                              ------------------------------
                                                   1998             1997
                                              -------------    -------------

Bank net worth per report to OTS              $  16,815,000    $  26,991,000
Rounding                                                (74)            (126)
                                              -------------    -------------
Net worth as reported in accompanying
     financial statements (bank only)            16,814,926       26,990,874
Adjustments to arrive at Core (Tier I)
     and Tangible Capital:
Disallowed servicing assets                        (226,000)         (96,000)
                                              -------------    -------------

Core (Tier I) and Tangible Capital               16,588,926       26,894,874
Adjustments to arrive at Total Capital:
     Allowable portion of general allowance
          allowance for loan losses               1,136,000          969,000
                                              -------------    -------------

Total Risk-Based Capital                      $  17,724,926    $  27,863,874
                                              =============    =============

Risk weight assets                            $ 122,817,000    $ 107,838,000
                                              =============    =============

14.     Contingencies

        The Company is at times a defendant in certain  claims and legal actions
        arising  in  the  ordinary  course  of  business.   In  the  opinion  of
        management,   after  consultation  with  legal  counsel,   the  ultimate
        disposition  of such matters is not expected to have a material  adverse
        effect on the consolidated financial condition of the Company.

15.     Employee Benefit Plans

        Employee Retirement Plan:
        The Bank  has  adopted  a  401(k)  defined  contribution  savings  plan.
        Substantially  all employees are covered  under the  contributory  plan.
        Pension costs  attributable  to the years ended September 30, 1998, 1997
        and 1996 were $29,847, $27,274 and $26,218, respectively,  including all
        current service costs.

        Deferred Compensation Agreements:
        The Bank has entered into deferred compensation  agreements with certain
        key  employees  which  provide for cash  payments to be made after their
        retirement.  The liabilities  under the agreements have been recorded at
        the present  values of accrued  benefits  using a 7% interest  rate. The
        balance of  estimated  accrued  benefits  was  $205,707  and $165,636 at
        September  30,  1998 and  1997,  respectively.  In  connection  with the
        deferred compensation agreements,  the Bank has purchased life insurance
        policies on covered  employees in which the Bank is the  beneficiary  to
        assist in funding  benefits.  At September  30, 1998 and 1997,  the cash
        surrender   values  on  the  policies   were   $522,791  and   $501,638,
        respectively.

        Employee Stock Ownership Plan:
        Upon  conversion  from mutual to stock  form,  the Bank  established  an
        employee  stock  ownership  plan  (ESOP).  The original  acquisition  of
        136,878  shares of  Company  stock by the plan was funded by a loan from
        the Company to the ESOP, in the amount of $1,368,780. The loan, together
        with  interest,  is to be repaid over a ten year period  through  annual
        contributions by the Bank.

                                      F-23

<PAGE>

15.     Employee Benefit Plans (Continued)

        The Bank makes annual contributions to the ESOP equal to the ESOP's debt
        service less dividends  received by the ESOP. All dividends  received by
        the ESOP are used to pay debt service.  The ESOP shares  initially  were
        pledged as collateral  for its debt.  As the debt is repaid,  shares are
        released from the collateral and will be allocated to active  employees,
        based on the  proportion  of debt  service  paid in the  year.  The Bank
        accounts for its ESOP shares in  accordance  with  Statement of Position
        No. 93-6.  Accordingly,  the debt of the ESOP is recorded as debt of the
        Bank and the shares  pledged as collateral are reported as unearned ESOP
        shares in the  Statement of  Financial  Condition.  As of September  30,
        l998,  the  balance of  indebtedness  from the ESOP to the  Company  was
        $692,719, which is shown as a deduction from stockholders' equity on the
        consolidated  balance  sheet.  The  debt,  which is  accounted  for as a
        liability  of the  Bank  and a  receivable  for the  Company,  has  been
        eliminated in consolidation. As shares are released from collateral, the
        Company reports  compensation  expense equal to the current market price
        of the shares,  and the shares become outstanding for earnings per share
        (EPS) computations. Dividends on allocated ESOP shares are recorded as a
        reduction of retained earnings, dividends on unallocated ESOP shares are
        recorded as compensation expense. ESOP compensation expense was $298,320
        and  $257,375  for  the  years  ended   September  30,  1998  and  1997,
        respectively.  As of September 30, 1998, of the 133,018 shares  acquired
        by the ESOP,  48,558  shares  were  allocated  and  84,460  shares  were
        unallocated. The 84,460 unallocated shares had an estimated market value
        of $1,858,120 at September 30, 1998.

        Management Stock Bonus Plan:
        In  connection  with  the  stock  conversion,  the  Bank  adopted  three
        Management Stock Bonus Plans  (collectively  the MSBP), the objective of
        which is to  enable  the Bank to  retain  personnel  of  experience  and
        ability in key  positions of  responsibility.  All employees of the Bank
        are eligible to receive benefits under the MSBP. Benefits may be granted
        at  the  sole  discretion  of a  committee  appointed  by the  Board  of
        Directors.  The  MSBP  is  managed  by  trustees  who  are  non-employee
        directors  and  who  have  the   responsibility   to  invest  all  funds
        contributed by the Bank to the trusts created for the MSBP.

        The  MSBP  has  purchased  91,252  shares  of the  Company's  stock  for
        $965,224.  These  shares were  granted in the form of  restricted  stock
        payable over a five-year  period at the rate of one-fifth of such shares
        per year following the date of grant of the award. Compensation expense,
        in the amount of the fair market  value of the common  stock at the date
        of the grant to the employee,  will be recognized pro rata over the five
        years  during  which  the  shares  are  payable.  A  recipient  of  such
        restricted  stock will be entitled  to all voting and other  stockholder
        rights,  except  that the  shares,  while  restricted,  may not be sold,
        pledged or otherwise  disposed of and are required to be held in escrow.
        If a holder of such restricted stock  terminates  employment for reasons
        other than death,  disability or retirement,  the employee  forfeits all
        rights to the allocated shares under  restriction.  If the participant's
        service  terminates  as a result of death,  disability,  retirement or a
        change in control of the Bank,  all  restrictions  expire and all shares
        allocated become unrestricted.  The Board of Directors can terminate the
        MSBP at any time,  and if it does so,  any  shares  not  allocated  will
        revert to the Company.

16.     Stock Option Plan

        In connection with the stock  conversion,  the Bank's Board of Directors
        adopted the 1994 Stock  Option Plan (the Option  Plan).  Pursuant to the
        initial  Option  Plan,  228,131  shares of common stock are reserved for
        issuance  by the  Company  upon  exercise  of stock  options  granted to
        officers,  directors  and  employees of the Bank from time to time under
        the  Option  Plan.  The  purpose  of  the  option  plans  is to  provide
        additional incentive to certain officers, directors and key employees by
        facilitating  their purchase of a stock  interest in the Company.  Stock
        option plans  provide for the granting of  incentive  and  non-incentive
        stock options with a duration of ten years, after which no awards may be
        made, unless earlier terminated

                                      F-24
<PAGE>


16.     Stock Option Plan (Continued)

        by the Board of  Directors  pursuant  to the option  plans.  Stock to be
        offered under the plans may be authorized  but unissued  common stock or
        previously  issued  shares that have been  reacquired by the Company and
        held as treasury shares.

        Option  plans  are  administered  by  a  committee  of  at  least  three
        non-employee  directors designated by the Board of Directors (the Option
        Committee).  The Option  Committee  will  select the  employees  to whom
        options are to be granted  and the number of shares to be  granted.  The
        option  price may not be less than 100% of the fair market  value of the
        shares  on the date of the  grant,  and no option  shall be  exercisable
        after the  expiration  of ten years from the grant date.  In the case of
        any employee who owns more than 10% of the  outstanding  common stock at
        the time the option is  granted,  the option  price may not be less than
        110% of the fair  market  value of the  shares on the date of the grant,
        and the option shall not be  exercisable  after the  expiration  of five
        years  from the  grant  date.  The  exercise  price may be paid in cash,
        shares of the common stock, or a combination of both.

        As of the date of  conversion,  the  Option  Committee  granted  228,131
        shares  of  common  stock,  at an  exercise  price  of  $10  per  share,
        contingent  upon  stockholder  approval  of the  Option  Plan  which was
        ratified June 22, 1994. In addition, options for 18,479 shares of common
        stock,  at an  exercise  price of $16.50  per  share,  were  awarded  on
        November  20,  1996.  Additionally,  options for 2,053  shares of common
        stock,  at an  exercise  price of  $23.625  per share,  were  awarded on
        January 15, 1998. All such options are  exercisable  immediately.  As of
        September  30,  1998,  no options  have been  exercised  and all options
        granted remain  outstanding.  The Company accounts for the fair value of
        its  grants  issued  under the plans  subsequent  to  October 1, 1996 in
        accordance with FASB Statement 123. The compensation  cost that has been
        charged  against  income for the plans was $7,658  and  $51,447  for the
        years ended September 30, 1998 and 1997, respectively.

        In accordance  with SFAS No. 123, the fair value of each option grant is
        estimated  on the date of grant using the  Black-Scholes  option-pricing
        model with the following  weighted  average  assumptions used for grants
        during  the  year  ended  September  30,  1998:  dividend  yield of 2.54
        percent,  expected volatility of 25.00 percent,  risk-free interest rate
        of 5.5 percent and  expected  life of two years.  Common  stock  options
        granted  during the year ended  September 30, 1998 had an exercise price
        of $23.625 per share and an estimated fair value of $3.73 per share.

        Certain  information  for the years  ended  September  30, 1998 and 1997
        relative to stock options are comprised of the following:
<TABLE>
<CAPTION>
                                                                                                          
                                                                                September 30,
                                                ----------------------------------------------------------------------------
                                                               1998                                     1997
                                                ------------------------------------     -----------------------------------
                                                                  Weighted-Average                            Weighted-Average
Fixed Options                                       Shares         Exercise Price             Shares          Exercise Price
-------------                                   ----------------  ------------------     ------------------   --------------
<S>                                                   <C>                <C>                   <C>               <C>   
Outstanding at beginning of year                        246,610           $   10.59                228,131        $   10.00
    Granted                                               2,053               23.63                 18,479            16.50
    Canceled
    Exercised
                                                ----------------  ------------------     ------------------   --------------
Outstanding at end of year                              248,663              $10.70                246,610           $10.59
                                                ================  ==================     ==================   ==============
Exercisable at end of year                              248,663                                    246,610
                                                ================                         ==================
Number of shares available for future grant:
    Beginning of year                                         0                                          0
                                                ================                         ==================
    End of year                                               0                                          0
                                                ================                         ==================


</TABLE>

                                      F-25

<PAGE>

17.     Financial Instruments

        The Bank is a party to financial instruments with off-balance-sheet risk
        in the normal  course of  business  to meet the  financial  needs of its
        customers  and to reduce its own  exposure to  fluctuations  in interest
        rates. These financial  instruments include commitments to extend credit
        and commitments to sell loans.  Those  instruments  involve,  to varying
        degrees,  elements  of credit  and  interest  rate risk in excess of the
        amount recognized in the Statement of Financial Condition.  The contract
        or  notional  amounts  of  those  instruments   reflect  the  extent  of
        involvement the Bank has in particular classes of financial instruments.

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

        At September 30, 1998, the Bank had outstanding commitments to originate
        loans receivable of $3,110,084. The commitments outstanding at September
        30, 1998  consisted  of  $3,060,084  in real estate  loans and a $50,000
        commercial  business loan. Of the  commitments  outstanding at September
        30, 1998,  $1,746,529  were for fixed rate loans with rates of 6.625% to
        10.75% and $1,363,555  were for adjustable rate loans with initial rates
        of 6.125% to 9.00%.

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

        The Bank had no outstanding  commitments  from mortgage banking concerns
        to purchase loans yet to be originated at September 30, 1998.

        The Bank had outstanding  commitments  with mortgage banking concerns to
        sell  loans  of  $3,554,652  at  September  30,  1998,  the  outstanding
        commitments expire on November 8, 1998.

        The Bank had no  commitments to purchase  mortgage-backed  securities or
        investments at September 30, 1998 and 1997.

        At September 30, 1998,  loans with a carrying  value of $2,408,689  have
        been  classified by management as  held-for-sale.  The carrying value of
        these loans is at the lower of cost or market value as of September  30,
        1998.

18.     Significant Concentrations of Credit Risk

        The Bank grants  mortgage,  consumer  and  business  loans  primarily to
        customers  within the state.  Although the Bank has a  diversified  loan
        portfolio,  a  substantial  portion of its  customers'  ability to honor
        their contracts is dependent upon the agribusiness and energy sectors of
        the  economy.  The  Bank's  net  investment  in  loans is  subject  to a
        significant  concentration  of credit risk given that the  investment is
        primarily within a specific geographic area.

                                      F-26

<PAGE>

18.     Significant Concentrations of Credit Risk (Continued)

        As of September 30, 1998 the Bank had a net  investment of  $174,732,943
        in loans  receivable.  These loans possess an inherent credit risk given
        the  uncertainty  regarding the borrower's  compliance with the terms of
        the loan  agreement.  To reduce  credit  risk,  the loans are secured by
        varying forms of collateral,  including  first mortgages on real estate,
        liens on personal property,  savings accounts, etc. It is generally Bank
        policy to file liens on titled  property  taken as  collateral on loans,
        such as real  estate  and  autos.  In the event of  default,  the Bank's
        policy is to  foreclose or  repossess  collateral  on which it has filed
        liens.

        In the event  that any  borrower  completely  failed to comply  with the
        terms of the loan agreement and the related collateral proved worthless,
        the Bank would incur a loss equal to the loan balance.

19.     Related Party Transactions

        Directors and primary officers of the Company were customers of, and had
        transactions  with, the Bank in the ordinary  course of business  during
        the  two  years  ended   September  30,  1998  and  1997,   and  similar
        transactions  are  expected  in the future.  All loans  included in such
        transactions  were  made on  substantially  the  same  terms,  including
        interest  rates  and  collateral,  as those  prevailing  at the time for
        comparable transactions with other persons and did not involve more than
        normal risk of loss or present other unfavorable features.

        The following analysis is of loans made to principal officers, directors
        and principal holders of equity  securities that  individually  exceeded
        $60,000 in aggregate during the year ended September 30, 1998:

                                                           
                 Balance, September 30, 1997        $2,999,450
               
                 New loans                           3,133,987
                 Repayments                          2,950,839
                                                    ----------
                 Balance, September 30, 1998        $3,182,598
                                                    ==========
        
        The Bank has made several  commercial  loans to a director that at times
        have  approached  the  loans  to  one  borrower  limitations.  The  Bank
        evaluates the loan  limitations and sells the loans if they would exceed
        the  loans to one  borrower  limitation.  The Bank  sold  $1,010,165  of
        related  party  loans of this type during the year ended  September  30,
        1998.

20.     Disclosures about Fair Value of Financial Instruments

        The  following  methods and  assumptions  were used to estimate the fair
        value of each class of financial instruments for which it is practicable
        to estimate that value:

        Cash:
        For those  short-term  instruments,  the carrying amount is a reasonable
        estimate of fair value.

        Time deposits in financial institutions:
        The fair value of fixed  maturity  certificate of deposits are estimated
        using the rates  currently  offered for  deposits  of similar  remaining
        maturities.

        Investment securities and mortgage-backed securities:
        For securities  held for investment  purposes,  fair values are based on
        quoted market prices or dealer quotes, if available.  If a quoted market
        price is not  available,  fair value is estimated  using  quoted  market
        prices for similar securities.

                                      F-27
<PAGE>


20.     Disclosures about Fair Value of Financial Instruments (Continued)

        Loans receivable:
        The fair value of loans is  estimated  by  discounting  the future  cash
        flows using the current  rates at which  similar  loans would be made to
        borrowers  with  similar  credit  ratings  and  for the  same  remaining
        maturities.

        Deposit liabilities:
        The fair value of demand deposits,  savings accounts,  and certain money
        market  deposits is the amount payable on demand at the reporting  date.
        The fair value of  fixed-maturity  certificates of deposit are estimated
        using the rates  currently  offered for  deposits  of similar  remaining
        maturities.

        Advances and other borrowings from Federal Home Loan Bank:
        The fair value of advances from the Federal Home Loan Bank are estimated
        using the rates offered for similar borrowings.

        Commitments to extend credit:
        The fair value of  commitments  is  estimated  using the fees  currently
        charged  to enter into  similar  agreements,  taking  into  account  the
        remaining  terms of the agreements and the present  creditworthiness  of
        the  counterparties.  For fixed rate loan  commitments,  fair value also
        considers the  difference  between  current levels of interest rates and
        the committed rates.

        The estimated  fair values of the Bank's  financial  instruments  are as
        follows:
<TABLE>
<CAPTION>

                                                     September 30, 1998      September 30, 1997
                                                    ---------------------  ----------------------
                                                     Carrying      Fair     Carrying    Fair
                                                      Amount       Value     Amount     Value
                                                    -----------  --------  ----------  --------
                                                           (In Thousands)
<S>                                                 <C>        <C>        <C>        <C>     
Financial assets:
     Cash and cash equivalents:
         Interest-bearing ........................   $  2,012   $  2,012   $  2,063   $  2,063
         Non-interest bearing ....................        833        833        678        678
     Time deposits in other financial institutions        250        111        111
     Investment securities held-to-maturity ......     11,575     11,681     18,838     18,907
     Investment securities available-for-sale ....      9,221      9,221      7,123      7,123
     Mortgage-backed securities held-to-maturity .     21,724     22,007     36,690     36,934
     Loans receivable ............................    172,324    176,586    157,673    157,985
     Loans held-for-sale .........................      2,409      2,409        490        499

Financial liabilities:
     Deposits ....................................    154,793    153,531    144,735    144,342
     Advances and other borrowings from
         the Federal Home Loan Bank ..............     41,700     41,682     46,200     46,058

                                                        Par        Fair       Par        Fair
                                                       Value      Value      Value      Value
                                                      -------    -------    -------    -------          
     Unrecognized financial instruments:
         Commitments to extend credit                  $3,110     $3,151     $1,907     $1,938
         Commitments to sell loans                      3,555      3,489        900        891

</TABLE>


        
                                      F-28
<PAGE>


                                                                


21.     Stock Conversion / Restrictions on Retained Earnings

        On August 24, 1993, the Board of Directors of the Bank adopted a Plan of
        Conversion to convert from a federally chartered mutual savings and loan
        association  to a  federally  chartered  stock  savings  bank  with  the
        concurrent  formation of Landmark  Bancshares,  Inc. to act as a holding
        company of the Bank (the "Conversion").

        At the date of  conversion,  March 28, 1994,  the Company  completed the
        sale of  2,281,312  shares of common  stock,  $0.10 par  value,  through
        concurrent  subscription  and  community  offerings at $10.00 per share.
        Included in the total shares  outstanding  are 91,252  shares which were
        purchased by the Bank's MSBP at an average price of $10.58 per share and
        136,878  shares  which were  purchased  by the Bank's ESOP at $10.00 per
        share. Net proceeds from the conversion,  after  recognizing  conversion
        expenses and underwriting costs of $701,411, were $22,111,709.  From the
        net  proceeds,  the Company  used  $11,055,855  to  purchase  all of the
        capital  stock of the  Bank,  $965,224  to fund the  purchase  of 91,252
        shares of the Company stock by the MSBP (Note 14) and $1,368,780 to fund
        the  purchase of 136,878  shares of the Company  stock by the ESOP (Note
        14).

        The Bank may not  declare or pay a cash  dividend  to the Company if the
        effect would cause the net worth of the Bank to be reduced  below either
        the  amount  required  for the  "liquidation  account"  or the net worth
        requirement imposed by the OTS. If all capital requirements  continue to
        be met, the Bank may not declare or pay a cash  dividend in an amount in
        excess of the  Bank's  net  earnings  for the  fiscal  year in which the
        dividend is  declared  plus  one-half  of the  surplus  over the capital
        requirements, without prior approval of the OTS.

        Office of Thrift  Supervision  regulations  require that upon conversion
        from  mutual  to stock  form of  ownership,  a  liquidation  account  be
        established  by  restricting  a portion of net worth for the  benefit of
        eligible  savings  account  holders who maintain their savings  accounts
        with the Bank after  conversion.  In the event of  complete  liquidation
        (and only in such event) each savings  account  holder who  continues to
        maintain   their  savings   account  shall  be  entitled  to  receive  a
        distribution from the liquidation account after payment to all creditors
        but before any  liquidation  distribution  with respect to common stock.
        The initial  liquidation  account was established at  $15,489,000.  This
        account may be proportionately  reduced for any subsequent  reduction in
        the eligible holder's savings accounts.

22.     Deposit Insurance

        The Deposit Insurance Funds Act of 1996 authorized the  recapitalization
        of the Savings Associations Insurance Fund (SAIF) by imposing a one time
        special assessment on institutions with SAIF assessable  deposits.  Such
        assessment  was at the  rate of  0.657%  and was  imposed  in  order  to
        increase the reserve levels of the SAIF to 1.25% of insured deposits. On
        September  30,  1996,  the Bank  recorded  a  pre-tax  expense  for this
        assessment of $937,073.  The Bank's  annual  deposit  insurance  rate in
        effect  prior to this  recapitalization  was 0.23% of insured  deposits,
        declining to 0.064% of insured deposits effective January 1, 1997.


                                      F-29
<PAGE>


23.     Parent Company Financial Information

        Condensed  financial  statements of Landmark  Bancshares,  Inc.  (Parent
        Company)  are  shown  below.  The  Parent  Company  has  no  significant
        operating activities.
<TABLE>
<CAPTION>

                   Condensed Statements of Financial Condition
                        As of September 30, 1998 and 1997
                                 (In Thousands)


                                                                  1998        1997
ASSETS                                                          --------    --------
<S>                                                             <C>         <C>     
         Cash and cash equivalents                              $    479    $    524
         Time deposits in other fnancial institutions                250         111
         Invesment securities available-for-sale                   6,000       4,137
         Investment subsidiary                                       920      11,039
         Loans receivable                                            939         996
                                                                --------    -------- 
         Total assets                                           $ 13,995    $ 16,883
                                                                ========    ========
LIABILITIES AND STOCKHOLDERS' EQUITY
     Liabilities                                                $  4,866    $    589
     Stockholders' equity:
         Common stock                                                228         228
         Additional paid-in capital                               22,466      22,117
         Retained income                                           4,845       3,410
         Net unrealized gain on available-for-sale securities        283         923
         Unamortized amounts related to ESOP and MSBP               (789)     (1,134)
                                                                ---------    --------     
                                                                  27,033      25,544
         Treasury stock, at cost                                 (17,904)     (9,250)
                                                                ---------   --------
         Total stockholders' equity                                9,129      16,294

         Total liabilities and stockholders' equity             $ 13,995    $ 16,883
                                                                ========    ========
</TABLE>


                       Condensed Statements of Operations
              For the Years Ended September 30, 1998, 1997 and 1996
<TABLE>
<CAPTION>

                                           1998       1997      1996
                                        -------    -------   -------
<S>                                   <C>        <C>       <C>    
Equity earnings of subsidiary           $ 2,267    $ 2,393   $ 1,331
Interest and dividend income                248        176       221
Net gain on sale of investments             202        220        27
Other                                       (77)         1         3
                                        -------    -------   -------
    Total income                          2,640      2,790     1,582
                                        -------    -------   -------
Operating expenses                          235        218       129
                                        -------    -------   -------
    Income before income taxes            2,405      2,572     1,453

Income tax expense                           41         58        49
                                        -------    -------   -------
    Net income                          $ 2,364    $ 2,514   $ 1,404
                                        =======    =======   =======
</TABLE>


                                 F-30
<PAGE>

23.     Parent Company Financial Information (Continued)

                       Condensed Statements of Cash Flows
              For the Years Ended September 30, 1998, 1997 and 1996
                                 (In Thousands)
                               
<TABLE>
<CAPTION>
                                                                  1998       1996       1995
                                                                -------    -------    -------
<S>                                                            <C>        <C>        <C>    
Cash Flows from Operating Activities
     Net income                                                 $ 2,364    $ 2,514    $ 1,404
     Adjustments to reconcile net income to net cash
       provided by operating activities:
         Equity in net income of subsidiary                      (2,267)    (2,393)    (1,331)
         Gain on sale of investments                               (202)      (220)       (27)
         (Increase) decrease in other assets                       (165)       (47)       449
         Increase in other liabilities                              (17)        19         71
         Other                                                      164         87       (137)
                                                                -------    -------    -------

         Net cash provided (used) by operating activities          (123)       (40)       429
                                                                -------    -------    -------

Cash Flows from Investing Activities
     Dividends from subsidiary                                    8,000      4,000
     Acquisition of investment securities available-for-sale,
       including deposits                                        (3,765)    (1,190)    (2,214)
     Proceeds from sale of investment securities
       available-for-sale                                           669        749        308
     Decrease in loans to subsidiary and ESOP, net                  152        150      5,837
     Other loans, net                                               (95)        90         33
                                                                -------    -------    -------

         Net cash provided by investing activities                4,961      3,799      3,964
                                                                -------    -------    -------

Cash Flows from Financing Activities
     Proceeds from subsidiary note payable                        8,200
     Repayment of note payable to subsidiary                     (3,500)
     Purchase of treasury stock                                  (8,654)    (3,223)    (3,526)
     Cash dividends paid                                           (929)      (678)      (752)
                                                                -------    -------    -------

         Net cash used by financing activities                   (4,883)    (3,901)    (4,278)
                                                                -------    -------    -------

         Increase (decrease) in cash and cash equivalents           (45)      (142)       115

         Cash and cash equivalents at beginning of year             524        666        551
                                                                -------    -------    -------

         Cash and cash equivalents at end of year               $   479    $   524    $   666
                                                                =======    =======    =======

</TABLE>


                                      F-31


<PAGE>

                                OFFICE LOCATION

                                CORPORATE OFFICE
                           Landmark Bancshares, Inc.
                               Central and Spruce
                            Dodge City, Kansas 67801
                                 (316) 227-8111

                Board of Directors of Landmark Bancshares, Inc.

        C. Duane Ross                            Larry Schugart
        Chairman of the Board                    President and Executive Officer
        President, High Plains Publishers, Inc. 

        David H. Snapp                           Richard Ball 
        Partner, Waite, Snapp & Doll,            CPA/Shareholder, Adams, Brown 
        Attorneys    at   Law                      Beran & Ball, Chtd.

        Jim W. Lewis
        Owner, Auto Dealerships

                Executive Officers of Landmark Bancshares, Inc.

        Larry Schugart                           Gary L. Watkins
        President and                            Secretary and    
        Chief Executive Officer                  Chief Financial Officer

        James F. Strovas        
        Treasurer and
        Chief Financial Officer            

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

Corporate Counsel:                               Independent Auditors:
Waite, Snapp & Doll, Attorneys at Law            Regier Carr & Monroe, L.L.P.
Landmark Federal Building                        300 West Douglas
Dodge City, Kansas  67801                        Suite 100
                                                 Wichita, Kansas  67202 


Special Counsel:                      Transfer Agent and Registrar:
Malizia, Spidi, Sloane & Fisch, P.C.  American Securities Transfer & Trust, Inc.
One Franklin Square                   1825 Lawrence Street, Suite 444
1301 K Street, N.W., Suite 700 East   Denver, Colorado  80202-1817
Washington, D.C. 20005


The Company's Annual Report for the year ended September 30, 1998 filed with the
Securities  and Exchange  Commission on Form 10-KSB is available  without charge
upon  written  request.  For a copy of the Form  10-KSB  or any  other  investor
information,  please write or call:  Corporate  Secretary,  Landmark Bancshares,
Inc.,  Central  and Spruce,  Dodge City,  Kansas  67801.  The annual  meeting of
stockholders  will be held on January  20,  1999 at 1:30 p.m.  at the Dodge City
Country Club, North Avenue C, Dodge City, Kansas 67801.