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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C.  20549


                                    FORM 10-K

                ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934


For the Fiscal Year ended December 31, 1996 Commission File Number 
0-11709

                         FIRST CITIZENS BANCSHARES, INC.
             (Exact name of registrant as specified in its charter)


          TENNESSEE
(State or other jurisdiction of             62-1180360
incorporation or organization)      (I.R.S. Employer Identification No.)


P. O. Box 370
First Citizens Place, Dyersburg, Tennessee                 38025-0370 
(Address of Principal Executive Offices)                   (Zip Code)


       Registrant's telephone number, including area code (901) 285-4410


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


                                              Name of each exchange
Title of each class                            on which registered
      NONE                                           NONE


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

                                  COMMON STOCK
                                (Title of Class)


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

The aggregate market value of voting stock held by nonaffiliates of the 
registrant at December 31, 1996 was $31,570,000.

Of the registrant's only class of common stock ($1.00 par value) there 
were 741,516 shares outstanding as of December 31, 1996.

                       DOCUMENTS INCORPORATED BY REFERENCE

                               Portions of the                  
                 Proxy Statement dated March 17, 1997 (Part III)
                         Filed by Electronic Submission





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                           PART I
ITEM 1.  BUSINESS

GENERAL

First Citizens Bancshares, Inc. ("Bancshares") was organized
December, 1982 as a Tennessee Corporation and commenced
operations in September, 1983, with the acquisition of all
Capital Stock of First Citizens National Bank of Dyersburg
("First Citizens").

First Citizens was chartered as a national bank in 1900 and
presently operates a general retail banking business in
Dyersburg and Dyer County, Tennessee providing customary
banking services.  First Citizens operates under the
supervision of the Comptroller of the Currency, is insured up
to applicable limits by the Federal Deposit Insurance
Corporation and is a member of the Federal Reserve System. 
First Citizens operates under the day-to-day management of its
own officers and directors; and formulates its own policies
with respect to lending practices, interest rates, service
charges and other banking matters.

Bancshares' primary source of income is dividends received
from First Citizens.  Dividend payments are determined in
relation to First Citizens' earnings, deposit growth and
capital position in compliance with regulatory guidelines. 
Management anticipates that future increases in the capital of
First Citizens will be accomplished through earnings retention
or capital injection.

The following table sets forth a comparative analysis of
Assets, Deposits, Net Loans, and Equity Capital of Bancshares
as of December 31, for the years indicated:

                                      December 31
                                    (in thousands)             
                            1996         1995         1994     
          
Total Assets            $313,069      $291,412      $256,685   
Total Deposits           256,413       237,160       209,481   
Total Net Loans          209,107       189,690       166,727   
Total Equity Capital      29,603        27,103        23,879   
     
    
Individual bank performance is compared to industry standards
through utilization of the Uniform Bank Performance Report
(UBPR), published quarterly by the Federal Financial
Institution's Examination Council.
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This report provides comparisons of significant operating
ratios of First Citizens with peer group banks.  Presented in
the following chart are comparisons of First Citizens with
peer group banks for the periods indicated:

                  12/31/96         12/31/95       12/31/94     
              FCNB  PEER GRP   FCNB  PEER GRP  FCNB PEER GRP

Average Assets/
Net Interest 
  Income       4.27%   4.33%   4.07%   4.40%   4.31%   4.43%   

Average Assets/
Net Operating 
   Income      1.32%   1.28%    .94%   1.29%   1.09%   1.26%   

Net loan losses/
Average total 
   loans        .07%    .15%    .11%    .14%    .01%    .12% 

Primary Capital/  
Average Assets 8.62%   8.35%   8.41%   9.04%   8.51%   9.02%   

Cash Dividends/
Net Income **  5.54%  41.18%   8.29%  43.28%  19.03%  43.50%  

*Performance as of 12/31/96 is compared to peer group totals
as of 09/30/96

 (Most recent UBPR available)

EXPANSION

Bancshares may, subject to regulatory approval, acquire
existing banks or organize new banks.  The Federal Reserve
Board permits bank holding companies to engage in non-banking
activities closely related to banking or managing or
controlling banks, subject to Board approval.  In making such
determination, the Federal Reserve Board considers whether the
performance of such activities by a bank holding company would
offer advantages to the public which outweigh possible adverse
effects.  Approval by the Federal Reserve Bank of a Bank
Holding Company's application to participate in a proposed
activity is not a determination that the activity is a
permitted non-bank activity for all bank holding companies. 
Approval applies only to the applicant, although it suggests
the likelihood of approval in a similar case.

First Citizens National Bank through its strategic planning
process has stated its intention to acquire other financial
institutions within the West Tennessee Area.  The Bank's
objective in acquiring other banking institutions would be for
asset growth and diversification into other market areas. 
Acquisitions would afford the bank increased economies of
scale within the data processing function and better
utilization of human resources.  Any acquisition approved by
the Board of Bancshares, Inc. would be deemed to be in the
best interest of Bancshares and its shareholders.

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On September 29, 1994, President Clinton signed into law the
Riegel-Neal Interstate Banking and Branching Efficiency Act of
1994.  The Act provides for nationwide interstate Banking and
branching within certain limitations.  A more detailed
description of the act is discussed within the section
entitled "Usury, Recent Legislation and Economic Environment."

SUPERVISION AND REGULATION

Bancshares is a one-bank holding company under the Bank
Holding Company Act of 1956, as amended, and is subject to
supervision and examination by the Board of Governors of the
Federal Reserve System.

As a bank holding company, Bancshares is required to file with
the Federal Reserve Board annual reports and other information
regarding the business obligations of itself and its
subsidiaries.  Board approval must be obtained before
Bancshares may:

(1)     Acquire ownership or control of any voting securities of
        a bank or Bank Holding Company where the acquisition
        results in the BHC owning or controlling more than 5
        percent of a class of voting securities of that bank or
        BHC;

(2)     Acquire substantially all assets of a bank or BHC or
        merge with another BHC.

Federal Reserve Board approval is not required for a bank
subsidiary of a BHC to merge with or acquire substantially all
assets of another bank if prior approval of a federal super-visory agency, 
such as the Comptroller of the Currency is required under the Bank Merger Act.
Relocation of a sub-sidiary bank of a BHC from one state to another requires 
prior approval of the Federal Reserve Board and is subject to the
prohibitions of the Douglas Amendment.

The Bank Holding Company Act provides that the Federal Reserve
Board shall not approve any acquisition, merger or consolid-ation which would 
result in a monopoly or which would be in furtherance of any combination or 
conspiracy to monopolize or attempt to monopolize the business of banking in 
any part of the United States.  Further, the Federal Reserve Board may not
approve any other proposed acquisition, merger, or consolid-ation, the effect 
of which might be to substantially lessen competition or tend to create a 
monopoly in any section of the country, or which in any manner would be in 
restraint of trade, unless the anti-competitive effect of the proposed
transaction is clearly outweighed in favor of public interest
by the probable effect of the transaction in meeting the
convenience and needs of the community to be served.  An
amendment effective February 4, 1993 further provides that an
application may be denied if the applicant has failed to
provide the Federal Reserve Board with adequate assurances
that it will make available such information on its operations
and activities, and the operations and activities of any
affiliate, deemed appropriate to determine and enforce
compliance with the Bank Holding Company Act and any other
applicable federal banking statutes and regulations.  In
addition, consideration is given to the competence, experience
and integrity of the officers, directors and principal
shareholders of the applicant and any subsidiaries as well as 

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the banks and bank holding companies concerned.  The Board
also considers the record of the applicant and its affiliates
in fulfilling commitments to conditions imposed by the Board
in connection with prior applications.

A bank holding company is prohibited with limited exceptions
from engaging directly or indirectly through its subsidiaries
in activities unrelated to banking or managing or controlling
banks.  One exception to this limitation permits ownership of
a company engaged solely in furnishing services to banks;
another permits ownership of shares of the company, all of the
activities of which the Federal Reserve Board has determined
after due notice and opportunity for hearing, to be so closely
related to banking or managing or controlling banks, as to be
a proper incident thereto.  Moreover, under the 1970
amendments to the Act and to the Board's regulations, a bank
holding company and its subsidiaries are prohibited from
engaging in certain "tie-in" arrangements in connection with
any extension of credit or provision of any property or
service. Subsidiary banks of a bank holding company are
subject to certain restrictions imposed by the Federal Reserve
Act on any extension of credit to the bank holding company or
to any of its other subsidiaries, or investments in the stock
or other securities thereof, and on the taking of such stock
or securities as collateral for loans to any borrower.

Bank holding companies are required to file an annual report
of their operations with the Federal Reserve Board, and they
and their subsidiaries are subject to examination by the
Board.

First Citizens Bancshares, Inc. is subject to capital adequacy
requirements imposed by the Federal Reserve Bank.  In
addition, First Citizens National Bank (the principal
subsidiary of the corporation) is restricted by the Office of
the Comptroller of the Currency from paying dividends in any
years which exceed the net earnings of the current year plus
retained profits of the preceding two years.  It is the policy
of First Citizens National Bank "the bank" to comply with
regulatory requirements for the payment of dividends.  The
Federal Reserve Bank adopted a risk-based capital measure for
use in evaluating the capital adequacy of bank holding
companies effective January 1, 1991.  The risk-based capital
measure focuses primarily on broad categories of credit risk
and incorporates elements of transfer, interest rate and
market rate risk.  The calculation of risk-based capital is
accomplished by dividing qualifying capital by weighted risk
assets.  The minimum risked-base capital ratio is 8%, at least
one-half or 4:00% must consist of core capital (Tier 1), and
the remaining 4:00% may be in the form of core (Tier 1) or
supplemental capital (Tier 2).  Tier 1 capital/core capital
consists of common stockholders equity, qualified perpetual
stock and minority interests in consolidated subsidiaries. 
Tier 2 capital/supplementary capital consists of the allowance
for loan and lease loses, perpetual preferred stock, term
subordinated debt, and other debt and stock instruments. 
Bancshares has historically maintained capital in excess of
minimum levels established by the Federal Reserve Board.  A
risked based capital analysis is performed on a quarterly
basis to test for compliance with Federal Reserve and bank
policy guidelines before declaring a dividend or increasing a
dividend.  The banks' policy states that before declaring a
dividend the following ratios will be achieved: (1) Risked
Based Capital Tier 1 will be 8.34% or above; Return on year-

      <PAGE>6

to-date average equity 9.00%; Asset Growth and projected one
year future asset growth less than 20.00%; and non performing
assets to capital less than 30%.  Non performing assets
include 90 day past due and non accrual loans.

EXECUTIVE OFFICERS OF THE REGISTRANT

The following information relates to the principal executive
officers of Bancshares and its principal subsidiary, First
Citizens National Bank as of December 31, 1996

Name                Age   Position and Office
                                        
Stallings Lipford   66    Chairman of the Board of      
                          First Citizens Bancshares, Inc and First
                          Citizens National Bank.  Mr.
                          Lipford joined First Citizens in
                          1950.  He became a member of the
                          Board of Directors in 1960 and
                          President in 1970.  He was made
                          Vice Chairman of the Board in 1982. 
                          He served as Vice Chairman of the
                          Board of Bancshares from September, 
                          1982 to February, 1984.  The Board      
                          elected Mr. Lipford Chairman of both
                          First Citizens and Bancshares on 
                          February 14, 1984.  He served as
                          President of First Citizens and
                          Bancshares from 1983 to 1992, and
                          as CEO of Bancshares and First
                          Citizens from 1960 until 1996.

Katie Winchester   56     President and CEO of First Citizens
                          Bancshares and First Citizens;
                          employed by First Citizens National
                          Bank in 1961; served as Executive
                          Vice President and Secretary of the
                          Board from 1986 to 1992.  She was
                          appointed CEO of First Citizens
                          Bancshares and First Citizens
                          National Bank in 1996; and
                          President of Bancshares and First
                          Citizens in 1992.  Ms. Winchester
                          was elected to the Board of both
                          First Citizens and Bancshares in 1990.
                          
                    
H. Hughes Clardy   54     Vice President of First Citizens Bancshares, Inc.; 
                          Senior Vice President and Senior Trust Officer
                          of First Citizens National Bank.
                          Employed by First Citizens National
                          Bank in 1993.  Mr. Clardy was
                          employed as Vice President and
                          Senior Trust Officer at Crestar
                          Bank from January, 1987 to January, 1991 and
                          as a Vice President of Dominion Trust Company       
                          of Tennessee from 1991 to 1993.






      <PAGE>7

Ralph Henson     55      Vice President of First Citizens
                         Bancshares, Inc.; Executive Vice President of 
                         Loan Administration of First Citizens National Bank. 
                         Employed by First Citizens National Bank in 1964.  
                         Mr. Henson served the Bank as Senior Vice President
                         and Senior Lending Officer until his appointment as
                         Executive Vice President of Loan Administration in
                         February, 1993.
                          
Jeffrey Agee     36      Vice President and Chief Financial
                         Officer of Bancshares, Inc. and
                         First Citizens as of April, 1994. 
                         Employed by First Citizens National
                         Bank in 1982.  Served the bank
                         previous to April, 1994 as Vice
                         President and Accounting Officer. 
                         Appointed Senior Vice President and
                         Chief Financial Officer of First
                         Citizens National Bank, April 17,
                         1996.

Barry Ladd       56      Appointed Executive Vice President
                         and Chief Administrative Officer of
                         First Citizens National Bank and
                         First Citizens Bancshares in 1996. 
                         Senior Vice President and Senior
                         Lending Officer of First Citizens
                         National Bank from April 20, 1994
                         to January 17, 1996.  Employed by
                         the Bank in 1972.  Mr. Ladd served
                         First Citizens as Vice President
                         and Lending Officer previous to his
                         appointment as Senior Vice President.           

Bennett Ragan, Jr.  48   Executive Vice President and Senior
                         Lending Officer of First Citizens
                         National Bank.  Senior Vice
                         President and Senior Lending
                         Officer from April 20, 1994 to
                         January 17, 1996. Employed by the
                         Bank in 1970.  Mr. Ragan served the
                         Bank as Vice President and Lending
                         Officer since 1986.  


Judy Long        42      Senior Vice President,
                         Administrative Officer and
                         Secretary to the Board of Directors
                         of First Citizens National Bank. 
                         Ms. Long also serves as Secretary
                         to the Board of First Citizens
                         Bancshares.  Employed by the Bank
                         on July 19,1974.  Previously served
                         as Vice President and Loan
                         Operations Manager (1992 - 1996).
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      <PAGE>8

Jimmy Welch      50      Senior Vice President and
                         Commercial Loan Officer.  Employed
                         by the bank on April 20,1987. 
                         Served as Senior Vice President and
                         Consumer Lending Manager from
                         October 25, 1990 to April 19, 1995.
                         Promoted to Senior Vice President
                         and Consumer Lending Manager on
                         April 19, 1995.  Appointed to the
                         position of Commercial Loan Officer
                         August 20, 1996.

BANKING BUSINESS

First Citizens operates a general retail banking business in
Dyer County, Tennessee.  The bank expanded its banking
operations into Lauderdale County with the purchase of a
branch bank in Ripley, Tennessee in January, 1995.  All
persons who live in either community or who work in or have a
business or economic interest in either county are considered
as forming a part of the area serviced by the bank.  First
Citizens provides customary banking services, such as checking
and savings accounts, funds transfers, various types of time
deposits, and safe deposit facilities.  It also finances
commercial transactions and makes and services both secured
and unsecured loans to individuals, firms, and corporations. 
Commercial lending operations include various types of credit
services for its customers.  Agricultural services are
provided that include operating loans as well as financing for
the purchase of equipment and farm land.  The installment
lending department makes direct loans to individuals for
personal, automobile, real estate, home improvement, business
and collateral needs.  Mortgage lending makes available long 
term fixed and variable rate loans to finance the purchase of
residential real estate.  These loans are sold in the
secondary market without retaining servicing rights.  Credit
cards and open-ended credit lines are available to both
commercial customers and consumers.

First Citizens National Bank is located in a community
supported by a well diversified economy.  Dyer County is home
for over 393 full time farm operators of 603 farms with a
total land acreage of 230,906. Total Farm operators and farm
laborers represent a small percentage of the Dyer County
population (Dyer County Statistical Information, 1992-93).  At
12/31/96 agriculture loans outstanding totaled $25,895,000
representing 15.28% of total loans.  $16,890,000 was well
secured with farmland, including farms, residential and other
improvements, while $9,005,000 were secured loans to finance
agricultural production and equipment purchases. Approximately
$3,211,000 of agricultural loans were 90% FmHA guaranteed. 
Dyer County is also the home base for over 45 manufacturing
firms employing in excess of 40% of the population. 
Distribution of employment in other areas consist of 14.9%
services, 14.8% government, and 19.3% trade.  While First
Citizens is dependent upon the debtors ability to honor their
obligations, there are no concentrations of credit in any one
borrower, type of loan or industry that would represent a
material affect to the net income of the Bank.

First Citizens Financial Plus, Inc., a Bank Service
Corporation wholly owned by First Citizens National Bank is a
licensed Brokerage Service.  This allows the bank to compete
on a limited basis with numerous non-bank entities who pose a 

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continuing threat to our customer base, and are free to
operate outside regulatory control.

First Citizens was granted trust powers in 1925 and has
maintained an active Trust Department since that time.  Assets
as of December 31, 1996 were in excess of $132,892,000. 
Services offered by the Investment Management and Trust
Services Division include but are not limited to estate
settlement, trustee of living trusts, testamentary trustee,
court appointed conservator and guardian, agent for investment
accounts, and trustee of pension and profit sharing trusts.  

The business of providing financial services is highly
competitive.  The competition involves not only other banks
but non-financial enterprises as well.  In addition to
competing with other commercial banks in the service area,
First Citizens competes with savings and loan associations,
insurance companies, savings banks, small loan companies,
finance companies, mortgage companies, real estate investment
trusts, certain governmental agencies, credit card
organizations, and other enterprises.

The following tabular analysis sets forth the competitive
position of First Citizens when compared with other financial
institutions in the service area for the period ending June
30, 1996. 

                                Dyer County Market       
                           (All Financial Institutions)
                                  (in thousands)
                          Total Deposits   % of Market Share
Bank Name                    06/30/96           06/30/96

First Citizens
National Bank                $234,684*            51.10%

First Tennessee
 Bank                         105,089             22.88%

Security Bank                  63,457             13.82%

Union Planters, FSB            52,776             11.48%

Dyersburg City Employees
Credit Union                    3,301               .72%

       Total                 $459,307            100.00%

*Does not include deposits of $21,225,000 categorized as
Overnight and fixed term Repurchase Agreements.

At December 31, 1996 Bancshares and its subsidiary, First
Citizens National Bank, employed a total of 145 full time
equivalent employees.  Having been a part of the local
community in excess of 100 years, First Citizens has been
privileged to enjoy a major share of the financial services
market.  Dyersburg and Dyer County are growing and with this
growth come demands for more sophisticated financial products
and services.  Strategic planning has afforded the Company
both the physical resources and data processing technology
necessary to meet the financial needs generated by this
growth.
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USURY, RECENT LEGISLATION AND ECONOMIC ENVIRONMENT

Tennessee usury laws limit the rate of interest that may be
charged by banks.  Certain Federal laws provide for preemption
of state usury laws. Legislation enacted in 1983 amends
Tennessee usury laws to permit interest at an annual rate of
interest four (4) percentage points above the average prime
loan rate for the most recent week for which such an average
rate has been published by the Board of Governors of the
Federal Reserve System, or twenty-four percent (24%),
whichever is less (TCA 47-14-102(3)).  The "Most Favored
Lender Doctrine" permits national banks to charge the highest
rate permitted by any state lender.

Specific usury laws may apply to certain categories of loans,
such as the limitation placed on interest rates on single pay
loans of $1,000.00 or less for one year or less.  Rates
charged on installment loans, including credit cards, are
governed by the Industrial Loan and Thrift Companies Act.

On September 29, 1994, President Clinton signed into law the
Reigle-Neal Interstate Banking and Branching Efficiency Act of
1994 ("Act").  The Act provides for nationwide interstate
banking and branching with certain limitations. The Act
permits bank holding companies to acquire banks without regard
to state boundaries after September 29, 1995.  The Federal
Reserve may approve an interstate acquisition only if, as a
result of the acquisition, the bank holding company would 
control less than 10% of the total amount of insured deposits
in the United States or 30% of the deposits in the home state
of the bank being acquired.  The home state can waive the 30%
limit as long as there is no discrimination against out-of-state institutions.

Pursuant to the Act, interstate branching will take effect on
June 1, 1997, except under certain circumstances.  Once a bank
has established branches in a host state (a state other than
its headquarters state) through an interstate merger
transaction, the bank may establish and acquire additional
branches at any location in the host state where any bank
involved in the interstate merger transaction could have
established or acquired branches under applicable federal or
state law.  The Act further provides that individual states
may opt out of interstate branching.  If a state does not opt
out of interstate branching prior to May 31, 1997, then a bank
in that state may merge with a bank in another state provided
that neither of the states have opted out.  States may either
enact laws opting out of interstate branching before June 1,
1997 or permit interstate merges transactions earlier than
June 1, 1997, by statute at their option.  A state also may
impose conditions on any interstate merger transaction that
occurs before June 1, 1997 if the conditions do not
discriminate against out-of-state banks, are not preempted by
federal law, and do not apply or require performance after May
31, 1997.

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      <PAGE>11

The Federal Reserve in September, 1996 gave bank holding
company section 20 units the right to exclude some securities
earnings from the 10% cap on underwriting revenue.  It later
tore down three firewalls, one of which prevented the same
bank employee from selling underwriting services, loans and
transactions accounts.  The Fed on December 20 more than
doubled, to 25% the amount of revenue section 20 units may
earn underwriting and dealing in commercial securities.  The
Office of the Comptroller of the Currency adopting its
controversial operating-subsidiary rule in November,
established a procedure that national banks may use to create
subsidiaries to underwrite securities sell insurance, or
conduct scores of other activities the banks may engage in
directly.  Change in the law for securities underwriting will
have no impact on First Citizens National Bank since the bank
does not engage in this practice.  

The OCC's operating-subsidiary rule also streamlined national
banks' applications for new branches.  It sets a strict 45-day
deadline for OCC action on all applications, with a 10 day
extension possible when serious CRA issues are raised.  The
OCC provision closely parallel proposed changes to Regulation
Y issued by the Fed in August, 1996.  Those changes expected
to be finalized soon, would give the Fed 15 days to process
most merger applications.  It would also expand data
processing powers, eliminate tying restriction on nonbanks,
and allow bank-run trusts to buy mutual funds advised by the
bank.

The Supreme Court ruled in February, 1996 that states must
permit national banks to sell insurance from places with fewer
than 5,000 residents.  In the fall of 1996, the OCC issued
guidelines that limit the authority of states to regulate
insurance sales by national banks and allowing bankers to sell
insurance to customers outside of small towns, including from
bank branches in major cities.  

There are no known trends, events or uncertainties that are
likely to have a material effect on First Citizens liquidity,
capital resources or results of operation. There currently
exists no recommendation by regulatory authorities which if
implemented, would have such an effect.  There are no matters
which have not been disclosed.  Interstate Banking/Branching
became a reality by legislation passed September 13, 1994. 
The act permits full nationwide interstate branching after
June 1, 1997.  First Citizens Bancshares, Inc. and First
Citizens National Bank are located in a highly competitive
market.  There are presently four banks competing for deposit
dollars and earning assets, two of whom are branches of large
regional competitors.  First Tennessee Bank and Union Planters
National Bank are two of the largest financial institutions in
the state.  Interstate banking could possibly bring about the
location of large out of state banks to the area.  If so,
First Citizens would continue to operate as it has in the
past, focusing on the wants and needs of existing and
potential customers. The quality of service and individual
attention afforded by an independent community bank cannot be
matched by large regional competitors, managed by a corporate
team unfamiliar to the area. First Citizens is a forward
moving bank offering products and services that are required
for maintaining satisfactory customer relationships moving
into the next decade and beyond.




      <PAGE>12

Monetary policies of regulatory authorities, including the
Federal Reserve Board, have a significant effect on operating
results of bank holding companies and their subsidiary banks. 
The Federal Reserve Board regulates the national supply of
bank credit by open market operations in United States
Government securities, changes in the discount rate on bank
borrowings, and changes in reserve requirements against bank
deposits.  A tool once extensively used by the Federal Reserve
Board to control growth and distribution of bank loans,
investments and deposits has been eliminated through
deregulation.  Competition, not regulation, dictates rates
which must be paid and/or charged in order to attract and
retain customers.

Federal Reserve Board monetary policies have materially
affected the operating results of commercial banks in the past
and are expected to do so in the future.  The nature of future
monetary policies and the effect of such policies on the
business and earnings of the company and its subsidiaries
cannot be accurately predicted.

ITEM 2. PROPERTIES

First Citizens owns and occupies a six-story building in
Dyersburg, Tennessee containing approximately 50,453 square
feet of office space, bearing the municipal address of First
Citizens Place (formerly 200 West Court).  An expansion
program completed during 1988 doubled the available floor
space of the existing facility.  The space was utilized to
combine all lending and loan related functions.  First
Citizens owns the Banking Annex containing total square
footage of 12,989, of which approximately 3,508 square feet is
rented to various tenants.  The municipal address of the bank
occupied portion of the Annex is 215-219 Masonic Street.

The land and building occupied by the Downtown Drive-In Branch
located at 113 South Church Street, Dyersburg, Tennessee is
owned by First Citizens.  The building, containing
approximately 1,250 square feet, is located on a lot which
measures 120 feet square.  Also located at this address is a
separate ATM facility wholly owned by the Bank.

The Midtown Branch of First Citizens is located at 620 U.S. 51
By-Pass adjacent to the Green Village Shopping Center.  The
building contains 1,920 square feet and has been owned by
First Citizens since construction.  The land on which this
Branch is located, having previously been leased, was
purchased during 1987.  In June of 1992 an additional 1.747
acres adjoining the Midtown Branch property was purchased to
accommodate future growth and expansion.  During 1993, the
Board of Directors made a decision to locate a branch office
at 2211 St. John Avenue near the Industrial Park, eliminating
the need to expand the Midtown Branch.  In 1996 the property
was moved from Premises and Equipment to Other Real Estate. 
The 1.747 acres valued at $164,000, is now offered for sale.

In addition, the Midtown Branch Motor Bank is located on .9
acres adjoining the Midtown Branch.  This property consists of
a servicing facility and six remote teller stations and is
owned in its entirety by the Bank.  A drive-through ATM was
located at this facility during 1994.





      <PAGE>13

The Newbern Branch, also owned by First Citizens, is located
on North Monroe Street, Newbern, Tennessee.  The building
contains approximately 4,284 square feet and occupies land
which measures approximately 1.5 acres. A separate facility
located in Newbern on the corner of Highway 51 and RoEllen
Road houses an ATM.  Both land and building are owned by the
Bank.

The Super Money Market Branch in the Kroger Supermarket on
Highway 78 is operated under a franchise obtained through
National Bank of Commerce, Memphis, Tennessee.  While the
fixtures are owned by First Citizens, space is made available
from the Kroger Company through the franchise agreement.  An
ATM is also located near the branch in the Kroger facility.

The Industrial Park Branch located at 2211 St. John Avenue is
a full service banking facility that offers  drive-thru Teller
and ATM services.  The building owned by First Citizens
National Bank contains approximately 2,773 square feet and is
located on 1.12 acres of land.  The Industrial Park Branch,
became operational In November, 1994.

In November, 1993 First Citizens National Bank leased space in
the Wal-Mart Store #677 located at 2650 Lake Road in
Dyersburg, Tennessee to locate an Automatic Teller Machine
(ATM).  The ATM was installed in December, 1993.  In January,
1995 the ATM was relocated in the newly constructed Super Wal-Mart Store at 
the same address.  

The Ripley Branch of First Citizens National Bank, purchased
January 16, 1995, is located at 292 South Washington Street in
Ripley, Tennessee (Lauderdale County).  The Branch contains
approximately 1,450 square feet and was built in 1984 on a
quarter acre of land.  The Ripley Branch is a full service
banking facility that also offers drive-up teller and twenty
four hour ATM services.  On July 14, 1995 the bank purchased
1.151 acres located on Cleveland Street in Ripley, Tennessee. 
The land was purchased  for future expansion of the Ripley
Branch.

There are no liens or encumbrances against any of the
properties owned by First Citizens.

ITEM 3. LEGAL PROCEEDINGS

On June 8, 1995, William M. Boehmler resigned without notice
from his position as President and Director of First Citizens
Financial Plus, Inc. a brokerage subsidiary owned by First
Citizens National Bank.  A subsequent lawsuit was filed by
First Citizens Financial Plus, Inc. against Boehmler and the
firm who employed him, J. B. Hilliard, W. L. Lyons, Inc.,
seeking compensatory and punitive damages because Boehmler
took information and records allegedly belonging to the
subsidiary.  An injunction was issued by the circuit court
prohibiting use of the information by the rival brokerage firm
until the matter could be resolved.  In January, 1996, an
arbitration panel of the National Association of Securities
Dealers awarded Boehmler and his current employer $134,045.87
from Financial Plus.  The arbitrators ordered Boehmler to pay
Financial Plus $9,500.00 for data reclamation costs.  A letter
issued by the arbitration panel stating their decision gave no
reason for the ultimate outcome of the hearing.  Based on
advice of legal council, management made the decision not to
pursue an appeal of the arbitration panel's decision.


      <PAGE>14

All costs associated with the matter have been included in
1995 financial statements as required by Financial Accounting
Standards.

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

During the fourth quarter of the year ending December 31,
1996, there were no meetings, annual or special, of the
shareholders of Bancshares.  No matters were submitted to a
vote of the shareholders nor were proxies solicited by
management or any other person.

                         PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED
STOCKHOLDER MATTERS 

     As of December 31, 1996 there were 645 shareholders of
Bancshares' stock.  Bancshares common stock is not actively
traded on any market.  Per share prices reflected in the
following table are based on records of actual sales during
stated time periods.  These records may not include all sales
during these time periods if sales were not reported to First
Citizens for transfer.

               Quarter Ended                High         Low

              March 31, 1996               $44.00      $44.00
              June 30, 1996                $49.10      $44.00
              September 30, 1996           $49.10      $44.00
              December 31, 1996            $55.00      $49.10

              March 31, 1995               $40.00      $37.40
              June 30, 1995                $42.00      $37.90
              September 30, 1995           $42.00      $41.99
              December 31, 1995            $44.00      $42.00


Dividends paid each quarter of 1996 were 32.5 cents per share. 
In addition a special dividend of 30 cents per share was paid
during the fourth quarter, bringing total dividends paid per
share during 1996 to $1.60.  Dividends paid per share during
1995 were 30 cents per share.  A special dividend of 10 cents
per share was declared during the fourth quarter of 1995.

                        Dividends - 1996
              Dividend                   Quarter
              Per Share                  Declared
                 .325                       1st
                 .325                       2nd
                 .325                       3rd
                 .325                       4th
                 .30*                       4th
         Total $1.60

*Special dividend paid in fourth quarter, 1996.

Future dividends will depend on Bancshares' earnings and
financial condition and other factors which the Board of
Directors of Bancshares considers relevant.
<PAGE>
      <PAGE>15

ITEM 6. SELECTED FINANCIAL DATA

The following table presents information for Bancshares
effective December 31 for the years indicated.
                                  (in thousands)
                              (except per share data)

                    1996     1995     1994      1993      1992 
Net Interest &  
 Fee Income (5)  $ 12,822 $ 11,283 $ 10,444 $ 10,220  $  9,733 
Gross Interest 
  Income(5)      $ 24,781 $ 22,465 $ 18,415 $ 17,481  $ 18,237 

Income From
 Continuing 
  Operations     $ 3,709  $  2,706 $ 2,946  $  2,638  $  2,175 

Long Term 
 Obligations(4)  $ 2,997  $  4,652 $ 4,125  $      0  $      0 
Income Per Share 
 from Continuing 
  Operation(1)   $  5.04  $   3.72 $  4.15  $   3.76  $   3.39 

Net Income per  
Common Share
 (2)(3)          $  5.04  $   3.72 $  4.15  $   3.94  $   3.39 

Cash Dividends 
Declared
per Common 
Share(2)(3)      $  1.60  $   1.30 $  1.19  $    .99  $    .94 

Total Assets at 
Year End         $313,069 $291,412 $256,687 $234,892  $239,897 

Allowance for 
 Loan Losses 
 as a % Loans       1.08%    1.16%    1.22%    1.13%     1.26% 

Allowance for 
 Loan Losses as 
 a % of Non-
 Performing Loans 176.08%  707.99%  196.75%  520.50%   967.62% 
 
Loans 90 Days 
 Past Due as a 
 % of Loans          .09%     .17%     .62%     .22%      .13% 
    

(1)Restated to reflect 10% stock dividend on December 15,      
   1992.
(2)Restated to reflect 2.5 for 1 Stock Split on October 15,    
   1993.
(3)The $1.60 dividend for 1996 reflects $.325 x 4 plus a       
   special dividend of $.30. 
(4)Long Term Obligations is FHLB Borrowings matched with Loans 
   & Investments.
(5)Reclassified 1992 to 1994 Overdraft Fee Income.  It is not  
   included on this line item.

Credit Card annual fees were restated from loan fees to other
income in years 1992 to 1995.<PAGE>
      <PAGE>16

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

To understand the following analysis, reference should be made
to the consolidated financial statements and other selected
financial data presented elsewhere in this report.  For
purposes of the following discussion, net interest income and
net interest margins are presented on a fully taxable
equivalent basis.  Per share data is adjusted to reflect all
stock dividends declared through December 31, 1996.

1996 was a record year for First Citizens National Bank.  Net
income was $3,709,904 compared to $2,705,656 and $2,946,249 in
1995 and 1994 respectively.  Earnings per common share was
$5.03, $3.72 and $4.15 for the years under comparison. 
Weighted average shares outstanding slightly increased to
736,436 from 726,489 at year end 1995 and 709,434 year end
1994.  Shares were issued from previously authorized unissued
stock to satisfy the requirements of the Dividend Reinvestment
Program.  Book and Market value continue to reflect a strong
earnings performance.  Book value of Bancshares' stock is up
$2.88 or 7.78% at 12/31/96.  Market value was $55.00 a share
compared to $44.00 at 12/31/95.  Total Assets net of reserve
for loan losses were $313,079,000, up from $291,412,000 in
1995.  Return on average assets was 1.23 percent after payment
of 1996 bonuses, while ROA for 1995 was .96 percent.  Double
digit loan growth, experienced again in 1996, ended the year
with total gross loans of $211,389,000.  Nonaccruals, non-performing assets 
and problem loans were up slightly due to the addition of one credit of 
approximately $991,000 in April, 1996.  The credit is discussed further in 
the non-performing asset section of this report.  Return on average equity 
of 13.14 percent improved 2.89% from year end 1995.  Management's
continued focus on the reduction of cost of funds is reflected
in the .13 percent decline when comparing 4.24 percent at
12/31/96 to 4.37 percent at 12/31/95.

Intense strategic planning is credited with the record earning
performance reflected.  The earnings performance was not only
driven by strong loan demand, but is also a result of 
improved operating efficiencies driven by the bank's ongoing
efforts to accomplish established goals.  

Management and staff of First Citizens has made a concentrated
effort to achieve a performance level comparable to its peers. 
Aggressive goals of the Bank's Strategic Plan include the
following: (1) To achieve loan growth in excess of 7 percent
annually.  (2) To remain an independent community bank serving
the needs of individuals, small businesses, corporations, and
agriculture customers; (3) To maximize the value of First
Citizens to its shareholders by providing the highest level of
customer service and the widest selection of quality products
and services; (4) To attract and retain high quality
personnel; while rightsizing staffing levels to be more in
line with peer banks; (5) To continuously evaluate and invest
in a product and service distribution system that will provide
our customers with personal access as well as electronic
delivery of products and services; (6) To establish a bank
owned finance company as well as investigate the addition of
insurance sales to the bank's products.  





      <PAGE>17

Customer satisfaction surveys indicate that First Citizens
provides high quality products and services. The bank
currently holds over 51% of its designated market.  Two new
branches were opened to expand the development of new and
future business in 1995.  Fulltime equivalent employees
reached high performance peer levels in the last half of 1995,
and have remained at that level throughout 1996.  The bank's
Automated Teller distribution (First Connection) was converted
from Deluxe, Inc. To Internet/Most, Reston, Virginia in June,
1996.  The "check connection", Visa Check Card was tested and
available to the market at year end 1996. In March, 1997 Delta
Finance, a Tennessee Corporation will open its doors to offer
consumer financing to the surrounding counties.  Delta Finance
incorporated in August, 1996, was established as a subsidiary
of First Citizens National Bank.  1997 Budget projects loan
volume ranging from $1,200,000 to $1,500,000. The company is
expected to reach the breakeven point at $1.5 million within
1997.  

The Bank's Strategic Plan (a three year plan that is reviewed
and updated annually) calls for the addition of insurance
sales to the banks' product and services provided to its
customers.  The bank is exploring the possibility of offering
property and casualty insurance products through a source
provided by Tennessee Bankers Association known as Bank
Insure.  BankInsure is a pilot program established in eight
states, including Tennessee.  The banks efforts to establish
insurance sales will be intensified beginning the first
quarter 1997.  Contacts with independent agents will be
explored to determine if a bank owned insurance company would
be a more profitable alternative than forming an alliance with
BankInsure.

Another strategic action to improve operating efficiency and
customer service was the development of a Technology Strategic
Plan. Action goals were adopted that include the following:
(1) Installation of Document Imaging. (2) Evaluation of a
Marketing CIF system which will allow for the identification
of needs and opportunities which exist in the current and
potential customer base.  (3) Maintaining the IBM AS/400 as
the bank's primary technology infrastructure with a local area
network as a secondary communication structure. (4) Surveying
the market to identify the potential for Home Banking and
Corporate Cash Management. In response to these goals, a
contract was signed with Southern Data, Atlanta Georgia for a
document imaging system in December, 1996.  Installation is
scheduled for the second quarter, 1997.  Harland Corporation
MCIF system was installed the last quarter, 1996; a marketing
director was hired in January 1996, and a contract was
negotiated with Alex Schessunoff to develop a bankwide Quality
Sales Quality Service Program.  Results of a Home Banking
survey completed by a Jackson, Tennessee, Marketing firm
indicated a demand for telephone and P.C. home banking
product.  First Citizens currently offers a touchtone
telephone banking service at no cost to its customers.  A
search for PC home banking will begin the second quarter,
1997.

Changes in Financial Accounting Standards

FASB NO. 114 (Accounting by creditors for impairments of
loans).  Effective date is fiscal years beginning after
December 15, 1994.  FASB 114 requires a bank to recognize
impairment of a loan if the present value of expected future
cash flows discounted at the loan's effective interest rate 


      <PAGE>18

(or alternatively, the observable market price of the loan or
the fair value of the collateral) is less than the recorded
investment.  If the fair value used is at least equal or
greater than the recorded amount, there is no impairment.  

Impaired loans are usually considered loans in non-accrual
status, 90 days or more past due that will not pay full
interest and principal due, or have been classified as a
problem loan. First Citizens National Bank has implemented
procedures that capture average balances of impaired loans,
interest income associated with impaired loans, and
allocations made to the reserve for loan losses associated 
with impaired loans.  There has been no material affect to
Bancshares or the Bank as a result of the implementation of
FASB 114. 

FASB NO. 115 (Accounting for certain investments in Debt and
Equity Securities).  Effective January 1, 1994, the Company
adopted FASB 115 and classified securities contained in its
investment portfolio according to stated specifications: Held-to-maturity 
(includes securities which the company has the
intent and ability to hold to maturity); Trading securities
(includes investment securities which are held for short-term
resale); and Available-for-sale (includes all other investment
securities).  The cumulative effect of FASB 115 on the
investment portfolio for 1995 was a positive $485,000 and the
1996 cumulative effect was a positive $95,000 (net of tax). 

FASB NO. 118 (Accounting by Creditors for Impairment of a Loan
- Income Recognition and Disclosures) amends FASB Statement
114 to allow a creditor to use exiting methods for recognizing
interest income on impaired loans.  Implementation of
procedures discussed in FASB 114 includes accounting
requirements for income recognition on impaired loans.

FASB NO. 119 (Disclosure about Derivative Financial
Instruments and Fair Value of Financial Instruments) amends
FASB 105 (Disclosure of Information about Financial
Instruments with Off-Balance-Sheet Risk and Financial
Instruments with Concentrations of Credit Risk), and FASB 107
(Disclosures about Fair Value of Financial Instruments). 
Effective for years after December 15, 1994. Statement No. 119
requires disclosures about the amounts, nature, and terms of
derivatives that are not subject to statement 105 because they
do not result in off-balance-sheet risk of accounting loss. 
It requires banks to make a distinction between financial
instruments held or issued for trading purposes and for
purposes other than trading.  Derivative products held in the
banks investment portfolio are reported on a quarterly basis
to the banks investment committee and Board of Directors. 
Reports presented include disclosure requirements stated in
FASB 119.  First Citizens National Bank has $0 investment in
derivative instruments.  

FASB NO. 121 (Impairment of Long Lived Assets).  FASB 121
establishes accounting standards for the impairment of long
lived assets, certain identifiable intangibles, and good will
related to those assets to be held and used and for long lived
assets and certain identifiable intangibles to be disposed of. 
An impaired loss is recognized as the amount by which the
carrying amount of the asset exceeds the fair market value of
the assets.  FASB 121 is effective for years beginning after
December 15, 1995.  We do not project any material write downs
at this time.
<PAGE>
      <PAGE>19

NON-INTEREST INCOME

The following table reflects non-interest income for the years
ending December 31, 1996, 1995, and 1994: 
<TABLE>
                                                 December 31
                                               Change from prior year
                                                 (in thousands)
<C>                    <S>     <S>       <S>      <S>      <S>       <S>        <S>   
                               Increase                    Increase 
                        Total (Decrease)            Total (Decrease)             Total
                         1996   Amount  Percentage  1995    Amount  Percentage   1994
Service Charges on
 Deposit Accounts      $1,457   $  152   11.65%    $1,305   $ 189    16.94%     $1,116 
Other Service Charges,
 Commissions & Fees    $  674   $  181   36.72%    $  493   $(242)  (33.93%)    $  735      
Other Income           $1,238   $  288   30.32%    $  950   $(101)   (9.61%)    $1,051
TOTAL NON-INTEREST
 INCOME                $3,369   $  621   22.60%    $   48   $(154)   (5.31%)    $  902  
</TABLE>

Total non-interest income is up over 22 percent when comparing
December 31, 1996 to December 31, 1995 after declining 5.3
percent when comparing the previous two year ends.  Service
charges on deposit accounts contributed  $1.4 million to total
income in 1996.  Service charge income rose 11.65% from 1995
and is projected to increase approximately $100,000 in 1997.  
In January, 1997 the per item overdraft fee increased from
$20.00 to $22.00.  In addition, a daily overdraft charge of
$5.00 per day is assessed for each day the account is
overdrawn after a 5 day grace period.  The overdraft fee was
increased in April, 1995 from $17.50 to $20.00 and the per day
overdraft charge was increased from $3.00 per day to $5.00 per
day.  Overdraft income was reclassified from interest and fees
on loans into other income for prior years and restated within
the table.  Non interest income in 1995 decreased when
compared to 1994 due to (1) a gross profit of $297,000
resulting from the sale of the Jackson (Madison County),
Tennessee property in 1994; and (2) A decrease in fee income
of $160,000 received from the Bank's Subsidiary, Financial
Plus, Inc.  The broker/dealer experienced a change in
management that resulted in legal proceedings (explained in
the legal proceeding section of this report).  Other income
increased in 1996 due to a one time refund of $70,705 from
bankruptcy trustees of  Southeast Fort Worth Ltd., increased
fee income from Financial Plus, Inc. and security gains
realized from the sale of Securities from the banks'
investment portfolio.  The Southeast refund partially
reimbursed the bank for settlement made to trust customers by
the bank in December 1989.  Trust income improved in excess of
25 percent in 1996.  Fees charged for services rendered were
restructured in 1995. Other service charges, commissions &
fees were restated for prior years to eliminate overdraft and
annual fees on the credit cards.  Other income was restated to
include those fees.
<TABLE>
NON-INTEREST EXPENSE
                                                  December 31
                                             Change from prior year
                                               (in thousands)
                                  Increase                  Increase   
                          Total  (Decrease)          Total (Decrease)          Total
                           1996   Amount  Percentage 1995    Amount Percentage 1994
<C>                        <S>     <S>     <S>      <S>     <S>     <S>      <S>      
Salaries & Employee
 Benefits                  $5,497  $ 325     6.29%  $5,172  $ 202     4.07%  $4,970  
Net Occupancy Expense         446    105    30.80%  $  341  $  23     7.24%  $  318  
Other Operating Expense     3,895   (220)    5.25%  $4,115  $ 593    16.84%  $3,522  
TOTAL NON-INTEREST EXPENSE $9,889  $ 261     2.71%  $9,628  $ 818     7.79%  $8,810  
</TABLE>





      <PAGE>20

Management efforts to control non-interest expense continues
to be reflected when reviewing non-interest expense categories
for the years under comparison.  Non-interest expense, up
slightly at 2.71%, was maintained below the consumer inflation
rate of 3 percent.  Salaries and benefits increased 6.29% in
response to payment of bonus incentives offered for improved
financial performance.  This trend is likely to continue,
given the bank's agressive earnings goals. Fulltime equivalent
employees remain at 145 for the years 1995 and 1996.  Fulltime
equivalent at 12/31/94 was 150.  FTE remained flat in 1996 in
spite of the employment of 4 tellers on the shelf hired to
fill vacancies created by absence or special projects.  Assets
per employee totaled $2.1 million at 12/31/96, $1.9 million at
12/31/95.  This compares to $2.3 million for peer group banks
at 12/31/96.  Increased operating expense of 16.84% in 1995 is
attributed to settlement and professional fees of $261,000
incurred as a result of arbitration between Financial Plus,
Inc. and William M. Boehmler and Hilliard Lyons, Inc.

December 31                            Asset Per Employee-Peer 
             Assets Per Employee-FCNB             Groups
                  (in thousands)              (in thousands)

   1996               $2,159                      $2,300
   1995               $1,969                      $1,900
   1994               $1,695                      $1,900
   1993               $1,563                      $1,900
   1992               $1,643                      $1,900

COMPOSITION OF DEPOSITS

The average daily amounts of deposits and rates paid on such
deposits are summarized for the periods indicated:

                                          December 31
                                        (in thousands)     
                         1996               1995              1994          
 
                  Average   Average  Average   Average  Average   Average  
                  Balance    Rate    Balance    Rate    Balance    Rate 
Non-Interest
Bearing Demand
Deposits         $ 26,641      -     $ 25,375     -    $ 24,989     -    

Savings Deposits $ 73,908   3.19%    $ 65,996   3.05%  $ 64,912   2.69%  

Time Deposits    $146,562   5.63%    $136,631   5.91%  $111,268   4.79%  

TOTAL DEPOSITS   $247,111   8.39%    $228,002   4.43%  $201,169   3.52%  

Growth in total deposits continues to be a challenge for First
Citizens National Bank.  The company's marketplace is
described as highly competitive, with a fairly sophisticated
customer base.  Competition is aggressive for both loans and
deposits.  According to a market share analysis, Bancshares
hold approximately 51% (excluding overnight and fixed term
repurchase agreements) of the bank deposits domiciled in Dyer
County.  The bank competes with First Tennessee Bank, N.A.
(23% of total county deposits), and Security (14%).  Union
Planters, another regional bank also hold market share of 11
percent.  First Citizens also competes with Dyersburg City
Employees Credit Union, seven or more consumer finance
companies, and other types of financial service providers in
the area.  In spite of aggressive competition, total deposits
increased $19.1 million and $26.8 million when comparing
12/31/96 to 12/31/95 and 12/31/94.  A review of the
composition of deposits in 1996 reflects growth of $8 million 

<PAGE>
      <PAGE>21
     
in savings deposits and approximately $10 million in time
deposits.  Approximately $32 million of total deposit growth
in 1995 was centered in time deposits.  Other factors
contributing to deposit growth was higher rates paid on
deposits than paid in 1994 and the purchase of $8 million in
deposits through the Ripley Branch acquisition.  An analysis
of 1994 reflects customers response to low interest rates and
their reluctance to recommit funds into bank Certificates of
Deposits.  Demand deposits have remained relatively flat when
reviewing the years under comparison. However, sweep account
funds totaling $14,844,000 are not included in the average
balances for non-interest bearing demand deposits.  The
"Sweep" total is included in the balance sheet category of
Securities Sold Under Agreement to Repurchase totaling $21.2
million. The average rate paid on interest bearing liabilities
at 12/31/96 was 4.02% compared to 4.89% at 12/31/95 and 4.81%
at 12/31/94.  Pricing of deposits is based on local market
competition and Treasury Bill rates.  

SHORT TERM BORROWINGS
                                      12/31/96        12/31/95
Amount outstanding-end of Period       $21,225        $19,745
Weighted Average Rate of Outstanding     4.31%          4.59%  
   
Maximum Amount of Borrowings at 
  Month End                             32,902         18,624 
Average Amounts Outstanding for 
  Period                                20,883         17,033 
Weighted Average Rate of Average 
  Amounts                                4.48%          4.66%  
    
Management is continuously monitoring and enhancing the bank's
product line in order to retain existing customers and to
attract new customer relationships.  Among new products
offered In 1996 was a "Visa Check Card"  and "The Nest Egg
Certificate of Deposit".  The Visa Check Card is an electronic
check that allows our customers another convenient method of
accessing their checking account funds without writing a
check.  The Nest Egg Certificate of Deposit was introduced as 
a college savings fund for parents requiring a savings
instrument with a low opening balance and as often as weekly
deposits made to the account.  Imaged deposit accounts
statements offered to the market in 1996, continue to be a
success with 99.9 percent acceptance.

The following table sets forth the maturity distribution of
Certificates of Deposit and other time deposits of $100,000 or
more outstanding on the books of First Citizens on December
31, 1996.  The overall total increased in excess of $9 million
when compared to the prior year. 

MATURITY DISTRIBUTION OF TIME DEPOSITS IN AMOUNTS OF $100,000
AND OVER

                                              December 31
                                             (in thousands)
                                   1996                   1995              
                            Amount       Percent  Amount       Percent
 Maturing in:
3 months or less           $13,960       36.57%  $ 3,577       13.40%  
Over 3 through 12 months   $16,902       44.26%  $13,928       52.16%  
Over 12 months             $ 7,319       19.17%  $ 9,201       34.44%  

     TOTAL                 $38,181      100.00%  $26,706      100.00%  


 


     <PAGE>22

The following table sets forth an analysis of sources and uses
of funds for the years under comparison.

                                SOURCES AND USES OF FUNDS
                                     (in thousands)
                          1996                     1995             1994
FUNDING USES       Average  Increase        Average  Increase      Average    
                   Balance (Decrease)       Balance (Decrease)     Balance    
                         Amount         %        Amount          %   Amount
INTEREST-EARNING
ASSETS:     

Loans (Net of 
Unearned Discounts    
& Reserve)       $203,663  $ 20,645 11.28% $183,018 $22,764  14.21%  $160,254 

Taxable Investment
Securities       $ 64,392  $  5,032  8.48% $ 59,360 $10,593  21.73%  $ 48,767 

Non-Taxable 
Investment
Securities       $ 10,825 $    358   3.42% $ 10,467 $(2,817)(21.21%) $ 13,284 

Federal Funds 
Sold             $  1,166  $(1,437)(55.21%)$  2,603 $   (84) (3.13%) $  2,687 

Interest Earning
Deposits In 
Banks            $    196  $    83  73.46% $    113 $   (43)(27.57%) $    156 

TOTAL INTEREST-
EARNING ASSETS   $280,242  $24,681   9.66% $255,561 $30,413  13.51%  $225,148 

Other Uses       $ 23,478  $ 2,540  12.14% $ 20,938 $   187    .91%  $ 20,751 

TOTAL FUNDING 
  USES           $303,720  $27,221   9.85% $276,499 $30,600  12.45%  $245,899 

INTEREST-BEARING 
  LIABILITIES:
Savings 
 Deposits        $ 73,908 $  7,912  11.99%  $ 65,996 $ 1,084   1.15% $ 64,912 

Time Deposits    $146,562 $  9,931   7.27%  $136,631 $25,363  22.80% $111,268 

Federal Funds
Purchased and 
Other Interest 
Bearing 
Liabilities      $ 28,470 $  4,857  20.57%  $ 23,613 $   967   4.27% $ 22,646 


TOTAL INTEREST-
BEARING 
LIABILITIES      $248,940 $ 22,700  10.04%  $226,240 $27,414  13.79% $198,826 
Demand Deposits  $ 26,641 $  1,266   4.99%  $ 25,375 $   386   1.55% $ 24,989 
Other Sources    $ 28,139 $  3,255  13.08%  $ 24,884 $ 2,800  12.68% $ 22,084 

TOTAL FUNDING
 SOURCES:        $303,720 $ 27,221   9.85%  $276,499 $30,600  12.45% $245,899 

<PAGE>
      <PAGE>23

<TABLE>
SUMMARY - AVERAGE BALANCE SHEET AND NET INTEREST INCOME ANALYSIS                                 

                                     (FIRST CITIZENS NATIONAL BANK)

                               Monthly Average Balances and Interest Rates
                                              (in thousands)
                           1996                    1995                       1994
                 Average          Average Average          Average  Average          Average 
                 Balance  Interest Rate   Balance Interest  Rate    Balance  Interest  Rate 
<S>                <C>     <C>    <C>      <C>      <C>      <C>   <C>      <C>      <C>
ASSETS
INTEREST EARNING
  ASSETS:
  Loans (1)(2)                                                                     
        (3)       $203,658 $19,768  9.71% $182,997 $ 17,718  9.69% $160,217 $ 14,619  9.12% 

Investment 
Securities:

  Taxable         $ 64,392 $ 4,353  6.76% $ 59,360 $  3,948  6.65% $ 48,767 $  2,978  6.11% 
  Tax Exempt (4)  $ 10,825 $   755  6.98% $ 10,467 $    730  6.98% $ 13,284 $    908  6.84% 

Interest Earning  
  Deposits        $    196 $     7  3.58% $    113 $      7  6.20% $    156 $      5  3.21% 

Federal Funds       
Sold              $  1,166 $    69  5.92% $  2,603 $    158  6.07% $  2,687 $    113  4.21% 

                  
Lease Financing   $      5 $     1 20.00% $     21 $      2  9.53% $     37 $      4 10.81% 

Total Interest
  Earning Assets  $280,242 $24,953  8.91% $255,561 $ 22,563  8.83% $225,148 $ 18,627  8.27% 

NON-INTEREST
  EARNING ASSETS:
Cash and Due From
  Banks           $ 10,048 $    -     -   $  9,457 $ -       -     $  8,876 $ -       -     

Bank Premises and
  Equipment       $  8,499 $    -     -   $  8,699 $ -       -     $  8,008 $ -       -     

Other Assets      $  4,931 $    -     -   $  2,782 $ -       -     $  3,867 $ -       -     

Total Assets      $303,720 $    -     -   $276,499 $ -       -     $245,899 $ -       -     

LIABILITIES AND
 SHAREHOLDERS'
  EQUITY:

INTEREST BEARING
  LIABILITIES:
Savings Deposits  $ 73,908 $ 2,355  3.19% $ 65,996 $  2,009 3.05%  $ 64,912 $ 1,746  2.69%  
 (5)

Time Deposits     $146,562 $ 8,246  5.63% $136,631 $  8,063 5.91%  $111,268 $ 5,335  4.79%  

Federal Funds
  Purchased and
  Other Interest
  Bearing
  Liabilities     $ 28,470 $ 1,358  4.77% $ 23,613 $  1,184 5.02% $ 22,646  $   912  4.03%   
Total Interest
  Bearing
  Liabilities     $248,940 $11,959  4.81% $226,240 $ 11,256 4.98% $198,826  $ 7,993  4.02%  

NON-INTEREST
  BEARING
  LIABILITIES:

Demand Deposits   $ 26,641 $     -   -    $ 25,375 $ -        -   $ 24,989  $ -        -   

Other                                      
  Liabilities     $ 2,213  $     -   -    $  1,972 $ -        -   $  1,553  $ -        -   

Total 
  Liabilities     $277,794 $     -   -    $253,587 $ -        -   $225,368  $ -        -   

SHAREHOLDERS'
  EQUITY          $ 25,926 $     -   -    $ 22,912 $ -        -   $ 20,530  $ -        -   



      <PAGE>24

TOTAL LIABILITIES
  AND SHAREHOLDERS'
  EQUITY          $303,720 $    -    -    $276,499 $ -       -     $245,899 $ -        -     

NET INTEREST
  INCOME          $   -    $12,994   -    $   -    $11,307   -     $   -    $10,634    -   

NET YIELD ON 
  AVERAGE EARNING
  ASSETS          $   -    $ -      4.64% $   -    $ -      4.43%  $   -    $ -      4.72% 
</TABLE>

(1)    Loan totals are shown net of interest collected, not earned and loan
       loss reserves.  

(2)    Fee Income is included in interest income and the computations of the
       yield on loans.  Overdraft Fee Income is excluded from the totals.

(3)    Includes loans on nonaccrual status.

(4)    Interest and rates on securities which are non-taxable for Federal
       Income Tax purposes are presented on a taxable equivalent basis.

(5)    Includes Insured Money Fund, NOW, Club Accounts, and other Savings. 
<TABLE>
VOLUME/RATE ANALYSIS
(First Citizens                1996 Compared to 1995           1995 Compared to 1994
 National Bank)                  Due to Changes in:             Due to Changes in:

                                               Total                         Total
                            Average  Average  Increase    Average  Average Increase
                            Volume    Rate   (Decrease)   Volume    Rate  (Decrease)

                                                  (in thousands) 
<C>                         <S>     <S>       <S>          <S>     <S>      <S>
Interest Earned On:

   Loans                    $ 2,002 $    48   $ 2,050      $ 2,987 $   112  $ 3,099  
 
   Taxable Investments          335      70       405          647     323      970  
       
   Tax Exempt Investment
     Securities                  25      -         25         (193)     15     (178) 
     

   Interest Bearing
    Deposits with Other
     Banks                        5      (5)        0            1       1        2  
      

   Federal Funds Sold and
     Securities purchased
     under agreements to 
     resell                     (87)     (2)      (89)          (4)     49       45  
       

   Lease Financing               (1)      -        (1)          (4)      2       (2) 
      
TOTAL INTEREST EARNING        
     ASSETS                 $ 2,279 $   111   $ 2,390      $ 3,434  $  502   $ 3,936 
  

Interest Paid On: 
   Savings Deposits             241    105        346           29     234       263 
      
   Time Deposits                587    (404)      183       1,215    1,513     2,728 
      
   Federal Funds Purchased
     and Securities Sold
     Under Agreement to
     Repurchase                 244     (70)     174           39      233       272 
       
TOTAL INTEREST BEARING
     LIABILITIES            $ 1,072 $  (369)  $   703    $ 1,283   $ 1,980   $ 3,263 
  
    INTEREST EARNINGS       $ 1,207 $   480   $ 1,687    $ 2,151   $(1,478)  $   673 
</TABLE>  
A summary of average interest earning assets and interest
bearing liabilities is set forth in the preceding table
together with average yields on the earning assets and average
cost on the interest bearing liabilities.  Total interest
earning assets increased 9.66% and 13.51% when comparing 1996
to 1995 and 1994.  Total interest bearing liabilities 

      <PAGE>25

increased 10.04% and 13.79% when comparing 1996, 1995 and 1994
respectively.  Total interest earning assets averaged
$280,242,000 at an average rate of 8.91% while total interest
bearing liabilities averaged $248,940,000 at an average rate
of 4.81%.  Net yield on average earning assets (annualized)
was 4.64%, 4.43%, and 4.72% for the years 1996, 1995, and
1994, reflecting an upward swing in interest rates in 1994.
Maintaining interest rate margins achieved in prior years
proved more difficult in 1995 due to higher rates paid on
deposits.  However, 1996 Cost of funds was reduced, thereby
improving interest rate margins.  Asset/Liability policies are
in place to protect the company from the negative effects of
volatile swings in interest rates.  Interest margins are well
managed to achieve acceptable profits and a return on equity
within policy guidelines.

LOAN PORTFOLIO ANALYSIS

COMPOSITION OF LOANS
                                          December 31 
                                      (in thousands)
                          1996       1995     1994      1993     1992    
Real Estate Loans:   
Construction            $ 17,130  $ 12,954  $ 10,511  $  7,675  $  5,272  
Mortgage                $127,080  $107,844  $ 97,310  $ 87,314  $ 79,376  

Commercial, Financial
and Agricultural Loans  $ 42,067  $ 45,061  $ 38,843  $ 35,626  $ 33,931  
Installment Loans to
Individuals             $ 22,743  $ 23,718  $ 19,117  $ 15,901  $ 15,077  

Other Loans             $  2,369  $  2,329  $  3,000  $  2,806  $  2,005  

TOTAL LOANS             $211,389  $191,906  $168,781  $149,322  $135,661 

CHANGES IN LOAN CATEGORIES

             December 31, 1996 as compared to December 31, 1995
                               (in thousands)

                         Amount of Increase            % of Increase      
       
Loan Category               (Decrease)                   (Decrease)    

Real Estate                  $23,412                      19.39%          
       

Commercial, Financial   
  and Agricultural           $(2,994)                     (6.65%)         
           

Installment Loans to
 Individuals                 $  (975)                     (4.11%)         
 

Other Loans                  $    40                       1.72%          
         

TOTAL LOANS                  $19,483                      10.16%          
          
The bank's loan portfolio has experienced exceptional loan growth as
reflected in the Composition of Loans table.  Total loans at 12/31/96 was
$211,389,000 compared to $191,906 000 for the same time period in 1995. 
A comparison of growth in the portfolio indicates the largest percentage
of growth (19.39%) is centered in Real Estate.  Mortgage and con-struction 
loans increased approximately $23 million in 1996.  Growth in
this category in 1995 exceeded 19 percent.  The upward trend is
attributed to substantial growth in both population and number of
households recorded in Dyer county over the past decade.  Loan categories 

      <PAGE>26

reflecting a decrease from 1995 are Commercial, Financial and Agriculture
loans ($2,994,000 or 6.65%) and Installment Loans to Individuals
($975,000 or 4.11%).  Agricultural resources comprise a significant part
of the Dyer County market.  In 1996, crop production as well as commodity
prices were higher than in previous years, thereby accounting for a
significant pay down in agriculture loans at year end.  Problem and non-
performing loans increased after April, 1996 due to the addition of
Bennett Funding Group, Inc. loan in the amount of $991,029.  First
Citizens was made aware that the company had filed a Chapter 11
Bankruptcy and that legal claims had been filed against the company's CFO
claiming among other things the selling of fictitious leases.  Assets of
the corporation were frozen as a result of the bankruptcy filing.  First
Citizens National Bank is a holder of outstanding debt on Bennett Funding
Group, Inc. totaling $991,029 down from the beginning balance of
$1,699,880.  As of December 31, 1996 approximately $300,000 of the debt
was charged off.   An allocation of $400,000 had been added to the loan
loss reserve to cover any exposure to the bank. The bank holds 176
outstanding leases securing the debt.  Of the total, 25 have been
contacted using the acceptable language provided by Bennett.  Response
received indicate that the equipment securing the leases is in place and
in working order.  All leases have been reinspected and we have no reason
to believe there are fictitious or fraudulent leases in our portfolio. 
First Citizens joined with other banks, also purchases of leases from
Bennett Funding, to employ legal representation as a group until all
facts can be sorted out.  

First Citizens is located in the Dyersburg/Dyer County Trade Area, having
a population of 40,000.  The entire trade area has out paced both the
state and the nation in per capita personal income growth since the early
1980's.  The State of Tennessee projects that per capita income in the
area will be greater than the national average by the year 2000.  The mix
of industry in the local economy has provided stable, growing employment
opportunities for residents under all economic conditions.  The Dyer
County distribution of employment consists primarily of service employers
14.9%, government 14.7%, trade 19.3%, and manufacturing 40.5%.  Dyer
County's unemployment rate at year end was 6.8% down from November's rate
of 7.2%, but higher than the State of Tennessee's rate of 4.2%.  The loan
portfolio is made up of quality loans, and is well diversified with no
concentrations of credit in any one industry.  Problem loans totaled
$2,856,235 at 12/31/96, while watch loan total was slightly above $5,000. 
Total non-performing loans were .61% of total portfolio, at 12/31/95
compared to .73% for peer group banks.  Experience of the lending staff
and adherence to policy lends a comfort level to the portfolio that
supports the Loan Loss Allowance at the present level.    

The book value of repossessed real property held by Bancshares at year
end was $194,000 compared to $935,000 at 12/31/95 and $1,119,000 at
12/31/94.  The balance was significantly reduced as a result of the sale
of the  Strip Shopping Center (at a loss of $18,000) in November, 1996. 
The remaining balance held in repossessed real property represents real
estate held by First Citizens National Bank with exception to property
purchased for expansion of the branch located on Highway 51 Bypass valued
at $164,000.  Accounting for adjustments to the value of Other Real
Estate when recorded subsequent to foreclosure is accomplished on the
basis of an independent appraisal.  The asset is recorded at the lesser
of its appraised value or the loan balance.

Loan Administration sets policy guidelines approved by the Board of
Directors regarding portfolio diversification and underwriting standards. 
Loan policy also includes board approved guidelines for collateral-ization, 
loans in excess of loan to value limits, maximum loan amount,
maximum maturity and amortization period for each loan type.   Policy
guidelines for loan to value ratio and maturities related to various
collateral as follows:






      <PAGE>27

Collateral              Max. Amortization          Max. LTV

Real Estate        Various (see discussion)    Various (see discussion)
Equipment          5 Years                    75%
Inventory          5 Years                    50%
A/R                5 Years                    75%
Livestock          5 Years                    80%
Crops              1 Year                     50%
*Securities        10 Years                   75% (Listed)
                                              50% (Unlisted)

*Maximum LTV on margin stocks (stocks not listed on a national exchange)
when proceeds are used to purchase or carry same, shall be 50%.

Diversification of the banks' real estate portfolio is a necessary and
desirable goal of the bank's real estate loan policy.  In order to
achieve and maintain a prudent degree of diversity, given the composition
of the bank's market area and the general economic state of the market
area, the bank will strive to maintain a real estate loan portfolio
diversification based upon the following:

 . Agricultural loans totaling in the aggregate no more than 20% of the
  Bank's total loans.

 . Land acquisition and development loans totaling in the aggregate no
  more than 10% of the Bank's total loans.

 . Commercial construction loans totaling in the aggregate no more than
  10% of the Bank's total loans.

 . Residential construction loans totaling in the aggregate no more than
  10% of the Bank's total loans.

 . Residential mortgage loans totaling in the aggregate no more than 40%
  of the Bank's total loans.

 . Commercial loans totaling in the aggregate no more than 30% of the
  Bank's total loans.

It is the policy of FCNB that no real estate loan will be made (except in
accordance with the provisions for certain loans in excess of supervisory
limits provided for hereinafter) that exceed the loan-to-value percentage
limitations ("LTV limits") designated by category as follows:

     Loan Category                          LTV Limit

  Raw Land                                    65%
  Land Development or Farmland                75%
  Construction:
     Commercial, multi-family, and
     other non-residential                    80%
     1-to-4 family residential                80%
  Improved Property                           80%
  Owner-occupied 1-to-4 family 
     and home equity                          80%

Multi-family construction loans include loans secured by cooperatives and
condominiums.  Owner-occupied 1-to-4 family and home equity loans which
equal or exceed 90% LTV at origination must have either private mortgage
insurance or other readily marketable collateral pledged in support of
the credit.

On occasion, the Loan Committee may entertain and approve a request to
lend sums in excess of the LTV limits as established by policy, provided
that:



      <PAGE>28

 . The request is fully documented to support the fact that other credit 
  factors justify the approval of that particular loan as an exception
  to the LTV limit; 

 . The loan, if approved, is designated in the Bank's records and
  reported as an aggregate number with all other such loans approved by
  the full Board of Directors on at least a quarterly basis; 
  
 . The aggregate total of all loans so approved, including the extension
  of credit then under consideration, shall not exceed 50% of the
  Bank's total capital; and 

 . Provided further that the aggregate portion of these loans in excess
  of the LTV limits that are classified as commercial, agricultural,
  multi-family or non-1-to-4 family residential property shall not
  exceed 30% of the Bank's total capital.  

Amortization Schedules:  Every loan must have a documented repayment
arrangement.  While reasonable flexibility is necessary to meet the
credit needs of the Bank's customers, in general all loans should be
repaid within the following time frames:

       Loan Category                      Amortized Period

       Raw Land                               10 years 
       Construction:
         Commercial, multi-family, and
         other non-residential                20 years 
         1-to-4 family residential            20 years 
       Improved Property Farmland             20 years 
       Owner-occupied 1-to-4 family 
         and home equity                      20 years       

The average yield on loans of First Citizens National Bank for the years
indicated are as follows:

         1996 -  9.71%
         1995 -  9.69%
         1994 -  9.12%
         1993 -  9.46%
         1992 - 10.05%

The aggregate amount of unused guarantees, commitments to extend credit
and standby letters of credit was $34,023,000 at 12/31/96.

LOAN MATURITIES AND SENSITIVITY TO CHANGES IN INTEREST RATES

                                           Due after
                          Due in one       one year but          Due after
                          year or less     within five years     five years
                                            (in thousands)

Real Estate                 $37,390            $91,237            $15,583

Commercial, Financial
 and Agricultural           $25,639            $15,332            $ 1,096

All Other Loans             $ 6,330            $18,599            $   183

  TOTALS                    $69,359           $125,168            $16,862

Loans with Maturities After One Year for which:
                                                (in thousands)
Interest Rates are Fixed or Predetermined             $125,933
Interest Rates are Floating or Adjustable             $ 16,097

The degree of interest rate risk that a bank is subject to can be
controlled through a well managed asset/liability management program. 
First Citizens controls interest rate risk by matching assets and
liabilities, (by employing interest-sensitive funds in assets that are
also interest sensitive).  One tool used to ensure market rate return is 
      <PAGE>29

variable rate loans.  Loans totaling $84,456,000 or 39.95% of the total
portfolio are subject to repricing within one year or carry a variable
rate of interest.  Loan maturities in the one to five year category
increased to $125,165,000 at 12/31/96 from $115,163,000 at 12/31/95 as a
result of customer demand to lock in fixed rates for a longer period of
time.  The trend exhibited by consumers in recent years to lock in
interest rates is projected to continue in 1997.

NON-PERFORMING LOANS

Nonaccrual, Restructured and Past Due Loans and Foreclosed Properties 
(First Citizens National Bank)
                                               December 31 
                                              (in thousands)

                        1996      1995      1994     1993     1992      
Nonaccrual Loans       $1,118    $  836    $  945    $1,079  $1,743   
Restructured Loans          0         0         0         0       0
Foreclosed Property
  Other Real Estate,       50       111       148        98     550    
  Other Repossessed 
    Assets                  0         0         0         0       0      
Loans and leases 90 days 
  Past due and still 
  accruing interest       177       313     1,044       322     176  
Total Nonperforming 
  Assets               $1,295    $1,260    $2,137    $1,499  $2,469  
Nonperforming assets 
 as a percent of 
 loans and leases 
 plus foreclosed  
 property at end 
 of year                  .62%     .66%     1.27%     1.01%   1.82%   

Allowance as a percent of:                  
 Nonperforming 
   assets              176.22%  175.88%    96.12%   111.81%  68.98%   
Gross Loans              1.08%    1.16%     1.22%     1.12%   1.27%   
Addition to Reserve as a 
  percent of Net 
  Charge-Offs          112.16%  180.20% 1,675.00%    93.69%  63.82% 
Loans and leases 90 days
  past due as a percent of
  loans and leases at year
  end                     .09%     .17%      .62%      .22%    .13% 
Recoveries as a 
  percent of Gross 
  Charge-Offs           20.15%   44.66%    87.10%    28.79%  36.17%  

Total Non Performing Assets were $1,295,000 as of 12/31/96 compared to
$1,260,000 at year end in 1995.  Non performing Assets as a percent of
loans was .62% compared to .66% in 1995 and .73% for peer group banks. 
Allowance for Loan Losses as a percent of Nonperforming assets and total
loans was 176.22% and 1.08% respectively.  Loan policy calls for an
allowance balance of at least 1% of total loans.  Continued improvements
reflected in the financial ratios are indicative of well communicated loan
policies and procedures.  Categorization of a loan as non-performing is not
in itself a reliable indicator of potential loan loss.  The banks' policy
states that the bank shall not accrue interest or discount on (1) any asset
which is maintained on a cash basis because of deterioration in the
financial position of the borrower, (2) any asset for which payment-in-full
of interest or principal is not expected, or (3) any asset upon which
principal or interest has been in default for a period of 90 days or more
unless it is both well secured and in the process of collection.  For
purposes of applying the 90 day due test for the non-accrual of interest
discussed above, the date on which an asset reaches non-accrual status is
determined by it contractual term.  A debt is well secured if it is secured
(1) by collateral in the form of liens or pledges or real or personal
property, including securities that have a realizable value sufficient to 
      <PAGE>30

discharge the debt (including accrued interest) in full, considered to be
proceeding in due course either through legal action, including judgement
enforcement procedures, or, in appropriate circumstances, through
collection efforts not involving legal action which are reasonably expected
to result in repayment of the debt or in its restoration to a current
status.  Loans that represent a potential loss to First Citizens are
adequately reserved for in the provision for loan losses.

Interest income on loans is recorded on an accrual basis.  The accrual of
interest is discontinued on all loans, except consumer loans, which become
90 days past due, unless the loan is well secured and in the process of
collection.  Consumer loans which become past due 90 to 120 days are
charged to the allowance for loan losses.  The gross interest income that
would have been recorded for the twelve months ending 12/31/96 if all loans
reported as non-accrual had been current in accordance with their original
terms and had been outstanding throughout the period is $201,000.  Interest
income on loans reported as ninety days past due and on interest accrual
status was $48,000 for 1995.  Loans on which terms have been modified to
provide for a reduction of either principal or interest as a result of
deterioration in the financial position of the borrower are considered to
be "Restructured Loans".  First Citizens has no Restructured Loans for the
period being reported.  

Certain loans contained on the bank's Internal Problem Loan List are not
included in the listing of non-accrual, past due or restructured loans. 
Management is confident that, although certain of these loans may pose
credit problems, any potential for loss has been provided for by specific
allocations to the Loan Loss Reserve Account.  Loan officers are required
to develop a "Plan of Action" for each problem loan within their portfolio. 
Adherence to each established plan is monitored by Loan Administration and
re-evaluated at regular intervals for effectiveness.

LOAN LOSS EXPERIENCE & RESERVE FOR LOAN LOSSES (in thousands)

                           1996      1995      1994      1993      1992      
Average Net Loans
Outstanding            $203,663   $183,018  $160,254  $141,664   $134,514   
Balance of Reserve
for Loan Losses
at Beginning of
Period                 $  2,216   $  2,054  $  1,676  $  1,703   $  1,936   
Loan Charge-Offs       $   (680)  $   (365) $   (186) $   (601)  $ (1,009)  
Recovery of Loans
Previously Charged Off $    137   $    163  $    162  $    173   $    365   

Net Loans Charged Off  $   (543)  $   (202) $    (24) $   (428)  $   (644)  
Additions to Reserve
Charged to Operating
Expense                $    609   $    364  $    402   $    401  $    411   
Balance at End of
Period                 $  2,282   $  2,216  $  2,054   $  1,676  $  1,703   

Ratio of Net Charge-
Offs to Average Net
Loans Outstanding          .27%      .11%      .01%       .30%      .48%   

The preceding table summarizes activity posted to the Loan Loss Reserve
Account for the past five years.  The summary includes the average net
loans outstanding; changes in the reserve for loan losses arising from
loans charged off and recoveries on loans previously charged off; additions
to the reserve which have been charged to operating expenses; and the ratio
of net loans charged off to average loans outstanding.  Changes to the
Reserve Account for the quarter just ended consisted of (1)  Loans charged
off of $680,000 (2) Recovery of loans previously charged off $137,000 and
(3) Additions to reserves totaling $609,000.    

An analysis of the allocation of the allowance for Loan Losses is made on a
fiscal quarter at the end of the month, (February, August, and November)
and reported to the board at its meeting immediately preceding quarter-end. 
Requirements of FASB 114 & 118 have been incorporated into the policy for
Accounting by Creditor for Impairment of a loan.  A loan is impaired when
it is probable that a creditor will be unable to collect all amounts due of
principal and interest according to the original contractional terms of the 
     <PAGE>31

loan. First Citizens adopted the following as a measure of impairment:  (1)
Impairment of a loan at First Citizens shall exist when the present value
of expected future cash flows discounted at the loans effective interest
rate impede full collection of the contract; and (2) Fair Value of the
collateral, if the loan is collateral dependent, indicates unexpected
collection of full contract value.  The Impairment decision will be
reported to the Board of Directors and other appropriate regulatory
agencies as specified in FASB 114 and 118.  The bank will continue to
follow regulatory guidelines for income recognition for purposes of
generally accepted accounting principles, as well as regulatory accounting
principles.

An annual review of the loan portfolio to identify the risks will cover a
minimum of 70% of the gross portfolio less installment loans.  In addition,
any single note or series of notes directly or indirectly related to one
borrower which equals 25% of the bank's legal lending limit will be
included in the review automatically.

For analysis purposes, the loan portfolio is separated into four
classifications:

1.  Pass - Loans that have been reviewed and graded high quality or no 
    major deficiencies.

2.  Watch - Loans which, because of unusual circumstances, need to be 
    supervised with slightly more attention than is common.

3.  Problem - Loans which require additional collection efforts to 
    liquidate both principal and interest.

4.  Specific Allocation - Loans, in total or in part, in which a future 
    loss is possible.

Examples of factors taken into consideration during the review are: 
Industry or geographic economic problems, sale of business, change of or
disagreement among management, unusual growth or expansion of the business,
past due status of either principal or interest for 90 days, placed on non-
accrual or renegotiated status, declining financial condition, adverse
change in personal life, frequent overdrafts, lack of cooperation by
borrower, decline in marketability or market value of collateral,
insufficient cash flow, and inadequate collateral values.

Identification of impaired loans from non-performing assets as well as
bankrupt and doubtful loans is paramount to the reserve analysis.  Special
allocations shall support loans found to be collateral or interest cash
flow deficient.  In addition an allowance shall be determined for pools of
loans including all other criticized assets as well as small homogeneous
loans managed by delinquency.  In no circumstance shall the reserve fall
below 1% of total loans less government guarantees.  The following is a
sample of information analyzed quarterly to determine the allowance for
loan losses.
<PAGE>
      <PAGE>32

LOAN LOSS ALLOWANCE ANALYSIS

          AVERAGE         AVERAGE         PERCENT   CURRENT   RESERVE
          LOSS 3 YRS.     BALANCE 3 YRS.            BALANCE   REQUIRED

  I. CREDIT      $         GROSS  $             %     $          $
     CARDS

 II. INSTALL.    $         NET    $             %     $          $  
     LOANS

III. IMPAIRED WITH ALLOCATIONS                        $          $
     IMPAIRED WITHOUT ALLOCATIONS                     $          $
                                        ALLOWANCE
 IV. DOUBTFUL                              50.00%     $          $
     SUBSTANDARD                           10.00%        
     WATCH                                  5.00%
     OTHER LOANS NOT LISTED PREVIOUSLY       .75%
     LESS SBA/FMHA GUARANTEED PORTIONS  
                                                    
     TOTAL LOANS                                      $

  V. LETTERS OF CREDIT                       .75%     $          $

 VI. OTHER REAL ESTATE OWNED                                     $
                                                               
     RESERVE REQUIRED                                            $
 
     RESERVE BALANCE                                             $
  
     EXCESS (DEFICIT)                                            $

     RESERVE AS % OF TOTAL LOANS %
     PEER GROUP %

     LOSS EXPERIENCE III & IV 
        (AVERAGE LAST 3 YEARS)                  % OR $



Accounting for adjustments to the value of Other Real Estate when recorded
subsequent to foreclosure is accomplished on the basis of an independent
appraisal.  The asset is recorded at the lesser of its appraised value or
the loan balance.  Any reduction in value is charged to the allowance for
possible loan losses.  All other real estate parcels are appraised annually
and the carrying value is adjusted to reflect the decline, if any, in its
realizable value.  Such adjustments are charged directly to expense.
<PAGE>
      <PAGE>33

Management estimates the approximate amount of charge-offs for the 12 month
period ending 12/31/97 to be as follows:

Domestic                                            Amount
  Commercial, Financial & Agricultural            $200,000
  Real Estate-Construction                               0
  Real Estate-Mortgage                              80,000
  Installment Loans to individuals & credit cards  120,000
  Lease financing                                        0

            01/01/97 through 12/31/97   Total     $400,000

The following table will identify charge-offs by category for the periods
ending December 31 as indicated:

                                            Year Ending December 31
                                                (in thousands)
                                         1996         1995        1994       
Charge-offs:
 Domestic:
  Commercial, Financial & Agricultural $ 432         $   54       $   32       
Real Estate-Construction                   0              0            0
  Real Estate-Mortgage                    20            113           22       
  Installment Loans to individuals 
   & credit cards                        228            198          132       
  Lease financing                          0              0            0
     Total                             $ 680         $  365       $  186


Recoveries:
 Domestic:
  Commercial, Financial & Agricultural $  32         $   38       $   30       
  Real Estate-Construction                 0              0            0
  Real Estate-Mortgage                     3             19           12  
Installment Loans to individuals 
   & credit cards                        102            106          120 
  Lease financing                          0              0            0
 
                               Total   $ 137        $   163       $  162       

Net Charge-offs                        $ 543        $   202       $   24       


COMPOSITION OF INVESTMENT SECURITIES
                                              December 31 
                                             (in thousands)

                               1996     1995     1994     1993     1992      
U. S. Treasury & 
 Government Agencies         $62,194  $59,462  $47,042  $42,502  $59,019   

State & Political 
 Subdivisions                $10,569  $10,776  $10,883  $12,774  $ 9,300   

All Others                   $ 2,984  $ 3,654  $ 4,801  $ 5,471  $ 6,129   

                  TOTALS     $75,747  $73,892  $62,726  $60,747  $74,448   

<PAGE>
      <PAGE>34

MATURITY AND YIELD ON SECURITIES - DECEMBER 31, 1996
                                   (in thousands)

                                  Maturing          Maturing        Maturing
                 Maturing      After One Year    After Five Years     After
              Within One Year Within Five Years Within Ten Years    Ten Years
              Amount  Yield    Amount   Yield     Amount   Yield  Amount Yield
U. S. Treasury 
and Government 
Agencies      $ 9,788  5.97%  $26,161   6.79%    $18,369   7.05%  $ 7,876 7.29%

State and 
Political
Subdivisions* $ 1,835  7.01%  $ 6,652   6.72%    $ 1,557   7.85%  $   525 7.72%

All Others    $   500  6.00%  $   ---     ---    $ 2,484   5.60%  $  ----   ---

TOTALS        $12,123  6.13%  $32,813   6.78%    $22,410   6.95%  $ 8,401 7.32%

*Yields on tax free investments are stated herein on a taxable           
 equivalent basis.

HELD TO MATURITY & AVAILABLE FOR SALE SECURITIES - DECEMBER 31, 1996

                                        Held to Maturity   Available for Sale 
                                                    (in thousands)
                                        Amortized  Fair     Amortized   Fair 
                                          Cost     Value       Cost     Value

U.S. Treasury Securities                  3,005     3,002     6,971     7,050
U.S. Government Agency & Corporation
  obligations (exclude mortgage-backed
  securities):
  Issued by U.S. Govt. Agencies (2)         0         0          0         0
  Issued by U.S. Govt.-Sponsored
      Agencies (3)                      16,027    16,009     26,760    26,819
Securities issued by states & political
  subdivisions in the U.S.:
  General Obligations                    3,549     3,556      3,412     3,413
  Revenue Obligations                    2,699     2,699        901       908
  Industrial development & 
   similar obligations                     310       319      2,896     2,911
Mortgage-backed Securities (MBS):
  Pass-through securities:
   Guaranteed by GNMA                      786       793        362       368
   Issued by FNMA & FHLMC                    0         0          0         0
   Other pass-through securities             0         0          0         0
  Other mortgage-backed securities
   (include CMOs, REMICs and stripped
   MBS):
   Issued or guaranteed by FNMA & FHLMC 
    or GNMA                              1,144     1,146      3,754     3,739
   Collateralized by MBS
    issued or guaranteed by 
    FNMA, FHLMC or GNMA                     35        35          0         0
   All other mortgage-backed securities      0         0          0         0
Other Debt Securities:                 
  Other domestic debt securities           500       501          0         0
  Foreign debt securities                    0         0          0         0
Equity Securities:
  Investments in Mutual Funds                0         0          0         0
  Other equity securities with readily
    determinable fair values                 0         0        749       757
  All other equity securities (1)            0         0      1,726     1,727
Total                                   28,055    28,060     47,531    47,692

(1)      Includes equity securities without readily determinable fair values
         at historical cost. 
(2)      Includes Small Business Administration "Guaranteed Loan Pool
         Certificates," U.S. Maritime Administration obligations, and Export-
         Import Bank participation certificates.
(3)      Includes obligations (other than pass-through securities, CMOs, and
         REMICs) issued by the Farm Credit System, the Federal Home Loan Bank
         System, the Federal Home Loan Mortgage Corporation, the Federal
         National Mortgage Association, the Financing Corporation, Resolution
         Funding Corporation, the Student Loan Marketing Association, and the
         Tennessee Valley Authority.


      <PAGE>35

A major goal of the bank's investment portfolio management is to
maximize returns from investments while controlling the basic elements
of risk.  The second goal is to provide liquidity and meet financial
needs of the community.  Investment Securities also serve as collateral
for government and public funds deposits.  Investment activity for 1996
was driven by strong loan demand and Financial Accounting Standard No.
115 (further explanation is contained within this section as well as
footnotes included in the Auditors Report) which addresses Accounting in
Certain Investments in Debt and Equity Securities.  The investment
portfolio, which currently totals $75,747,000, is comprised of U. S.
Treasury and U. S. Agency Obligations of $62,194,000, Municipal
Obligations of $10,569,000, and all other investments totaling
$2,984,000.  Fixed rate holdings comprise 90% of the portfolio, while
adjustable rates comprise the remaining 10%.  

The fixed rate holdings currently have an expected average life of 3.1
years.  It is estimated that this average life would extend to 4.6 years
should rates go up by 100 basis points and 4.9 years if rates increase
200 basis points. This is a result of some extension occurring in the
callable bonds and mortgage-backed holdings as rates rise.  Should rates
decline 100 basis points, the average life would decrease to 1.9 years.

In terms of price sensitivity, we estimate that if rates go up 100 basis
points the market value of the portfolio would fall by 3.3%, while rates
up 200 basis points would impact the market value by a negative 6.8%.
This is equal to the price sensitivity of the 4-year Treasury bond,
which is consistent with the current average life of the portfolio.  If
rates go down 100 basis points, we estimate that the market value would
increase by 2.3%.

The adjustable rate holdings reprice on an annual or more frequent basis
and currently have an average life of 6.8 years.  Due to the structure
of these holdings, we would expect very little extension to occur in
average life should interest rates rise, but could see some shortening
should rates fall. We estimate that the adjustable rate holdings also
have the price sensitivity of a 3-year Treasury, although this is more
difficult to project on adjustable rate holdings than on fixed rate
holdings.

FASB 115 required banks to maintain separate investment portfolios for
Held-to-Maturity, Available for Sale, and Trading Account Investments. 
As of 12/31/96 approximately 63 percent of the bank's total portfolio
was placed in the Held For Sale Account while the remaining 37 percent
is contained in the Held to Maturity Account.  FASB 115 also requires
banks to mark to market the Available for Sale and Trading Account
investments at the end of each calendar quarter.  Held-to-Maturity
account investments are stated at amortized cost on the balance sheet. 
Mark to market resulted in a positive capital entry of $159,542 as
reflected on the 12/31/96 balance sheet.  Mark to market impact to
capital on 12/31/95 was a positive $745,000.  All purchase and sale
transactions in 1996 were made in accordance with specifications set
forth in FASB 115.  During the fourth quarter of 1995 transfers were
made from the Held to Maturity account to the Held for Sale account to
provide for future liquidity.  The Financial Accounting Standards Board
provided a grace period under FASB 115 from November 15 thru December
31, 1995 to allow banks to reclassify investments contained in the three
portfolios.  The trading account at 12/31/96 maintained a zero balance. 
First Citizens has not engaged in Derivative activities as defined by
paragraphs 5 thru 7 of FASB 119.




<PAGE>
      <PAGE>36

Maturities in the portfolio are made up of 16.00% within one year, and
43.3% maturing after one year and within five years.  Maturities on
future investment purchases will be structured to meet loan demand as
well as projected changes in interest rates.

Gains/Losses reflected in year-end income statements attributable to
trading account securities:

   Year Ended  
     12/31       Gains        Losses           Net

     1996      $     0.00   $     0.00     $     0.00
     1995      $     0.00   $     0.00     $     0.00
     1994      $     0.00   $     0.00     $     0.00

The following table allocates by category unrealized Gains/Losses within
the portfolio as of December 31, 1995 (in thousands):
    
                                  Unrealized              Net 
                              Gains        Losses     Gains/Losses

U.S. Treasury                                              
  Securities                $   103        $   27       $    76 

Obligations of U.S.
  Government Agencies
  and Corporations          $   266        $  352       $   (86)

Obligations of States
  and Political 
  Subdivisions              $    41        $   26       $    15 

Federal Reserve and
  Corporate Stock           $     0        $    0       $     0 

TOTALS                      $   410        $  405       $     5 


LIQUIDITY AND INTEREST RATE SENSITIVITY

Liquidity is the ability to meet the needs of our customer base for loan
and deposit withdrawals by maintaining assets which are convertible to
cash equivalents with minimal exposure to interest rate risk. 
Liquidity, which is determined by a comparison of net liquid assets to
net liabilities, remains between 10% and 15%.  The stability of our
deposit base, sound asset/liability management, a strong capital base
and quality assets assure adequate liquidity.  Loan to deposit ratio at
12/31/96 was 82%.  Two factors primarily affecting liquidity in 1996,
were loan demand in excess of budget projections and customer demand to
lock in low interest rates for longer periods of time.  Solid deposit
growth centered primarily in time deposits provided a steady source of
funds to meet liquidity needs.  During the last half of 1994 interest
rates started to climb upward, causing consumers to move funds from
Annuities and Mutual Funds into bank certificates of deposits. Asset
growth was approximately 7% for 1996.  Other sources available to meet
liquidity needs were (1) approved lines of credit with Federal Home Loan
Bank and correspondent banks totaling $20 million (2) Loans and
investments in excess of $84,343,000 maturing within one year and (3)
approximately 63% of the banks' total investments placed in the held-for-
sale account. As of year end approximately $3 million was drawn on
approved lines of credit.  The borrowings were maturity matched with
loans and investments on the books of the bank.  

There are no known trends or uncertainties that are likely to have a
material affect on First Citizens liquidity or capital resources.  There
currently exists no recommendations by regulatory authorities which if
implemented, would have such an affect.  There are no matters of which
management is aware that have not been disclosed.


<PAGE>
      <PAGE>37

Interest rate sensitivity varies with different types of interest-earning 
assets and interest-bearing liabilities.  Overnight federal
funds, on which rates change daily, and loans which are tied to the
prime rate are much more sensitive than long-term investment securities
and fixed rate loans.  The shorter term interest sensitive assets and
liabilities are the key to measurement of the interest sensitivity gap. 
Minimizing this gap is a continual challenge and a primary objective of
the asset/liability management program.

The following condensed gap report provides an analysis of interest rate
sensitivity of earning assets and costing liabilities.  First Citizens
Asset/Liability Management Policy provides that the cumulative gap as a
percent of assets shall not exceed 10% for categories up to 12 months
and one to two year categories and 20% for categories in excess of two
years.  As evidenced by the following table, our current position is
significantly below this level, with annual income exposure determined
to be less than the $150,000 limitation established by policy.
<PAGE>
      <PAGE>38
<TABLE>
                                       CONDENSED GAP REPORT
12/31/96                                 CURRENT BALANCES
                                          (in thousands)
                                    DAILY     0-1        1-2      2-3      3-6     6-12
                         TOTAL    FLOATING   MONTHS     MONTHS   MONTHS   MONTHS  MONTHS 
<C>                      <S>        <S>        <S>        <S>     <S>      <S>     <S>          
CASH AND DUE FROM:
CASH AND DUE FROM        10,871       -          -          -         -        -       -
MONEY MARKET                196     196          -          -         -        -       -

TOTAL CASH & DUE FROM    11,067     196          -          -         -        -       -

INVESTMENTS
US TREASURIES            75,549       -          -      4,777     1,000    8,633   5,000 

TOTAL INVESTMENTS        75,549       -          -      4,777     1,000    8,633   5,000 

LOANS:
COMMERCIAL FIXED         25,394       -      4,875      1,127     1,471    1,913   3,199
COMMERCIAL VARIABLE      15,940       -     15,940          -         -        -       -
REAL ESTATE VARIABLE     19,844       -     18,703          -        13    1,128       -
REAL ESTATE FIXED       118,591       -      6,100      1,902     2,754    3,869   9,624
HOME EQUITY LOANS         5,007       -      4,303          -        29      272     402
SEC MORTGAGE                768       -          -          -         -        -       -
INSTALLMENT LOANS        22,669       -        717        182       294      913   1,781
INSTALLMENT VARIABLE         74       -         74          -         -        -       -
FLOOR PLAN                  733       -          -          -         -        -       -
CREDIT CARDS              1,759       -          -          -         -        -       -
FACTORING REC               184       -          -          -         -        -       -
OVERDRAFTS                  426       -          -          -         -        -       -
TOTAL LOANS             211,389       -     50,712      3,211     4,561    8,095  15,006
LOAN LOSS RESERVE         2,282       -          -          -         -        -       -

NET LOANS               209,107       -     50,712      3,211     4,561    8,095  15,006

FED FUNDS SOLD            1,000       -          -          -         -        -       -
TOTAL FED FUNDS SOLD      1,000       -          -          -         -        -       -

TOTAL EARNING ASSETS    285,656       -     50,712      7,988     5,561   16,728  20,006   

OTHER ASSETS:                  
BUILDING, F&F & LAND      8,135       -          -          -         -        -       -
OTHER REAL ESTATE            50       -          -          -         -        -       -
OTHER ASSETS              6,256       -          -          -         -        -       - 
TOTAL OTHER ASSETS       14,441       -          -          -         -        -       -

TOTAL ASSETS            311,164     196     50,712      7,988     5,561   16,728  20,006

DEMAND DEPOSITS:
DEMAND DEPOSITS          27,894       -          -          -         -        -       -

TOTAL DEMAND             27,894       -          -          -         -        -       -

SAVINGS ACCOUNTS:
REGULAR SAVINGS          16,886       -      1,000          -         -        -       -
NOW ACCOUNT              26,809       -          -          -         -        -       -
BUSINESS CHECKING           278       -          -          -         -        -       -
IMF-MMDA                 12,578   1,000          -          -         -        -       -
FIRST RATE ACCOUNT       17,820  17,820          -          -         -        -       -
DOGWOOD CLUB              5,139   1,139          -          -         -        -       -

TOTAL SAVINGS            79,510  19,959      1,000          -         -        -       -
</TABLE>
<PAGE>
      <PAGE>39

                     CONDENSED GAP REPORT
12/31/95                       CURRENT BALANCES
                        (in thousands)
                          1-2      2+
                         YEARS    YEARS
CASH AND DUE FROM:
CASH AND DUE FROM             -  10,871
MONEY MARKET                  -       -

TOTAL CASH & DUE FROM         -  10,871

INVESTMENTS
US TREASURIES             7,530  48,609

TOTAL INVESTMENTS         7,530  48,609

LOANS
COMMERCIAL FIXED          4,476   8,333
COMMERCIAL VARIABLE           -       -
REAL ESTATE VARIABLE          -       -
REAL ESTATE FIXED        20,739  73,603
HOME EQUITY LOANS             -       1
SEC MORTGAGE                  -     768
INSTALLMENT LOANS         4,035  14,747
INSTALLMENT VARIABLE          -       -
FLOOR PLAN                    -     733
CREDIT CARDS                  -   1,759
FACTORING REC                 -     184  
OVERDRAFTS                    -     426
TOTAL LOANS              29,250 100,554
LOAN LOSS RESERVE             -   2,282

NET LOANS                29,250  98,272

FED FUNDS SOLD                -   1,000

TOTAL FED FUNDS SOLD          -   1,000

TOTAL EARNING ASSETS     36,780 147,881

OTHER ASSETS:                  
BUILDING, F&F & LAND          -   8,135
OTHER REAL ESTATE             -      50
OTHER ASSETS                  -   6,256

TOTAL OTHER ASSETS            -  14,441

TOTAL ASSETS             36,780 173,193

DEMAND DEPOSITS:
DEMAND DEPOSITS               -  27,894

TOTAL DEMAND                  -  27,894

SAVINGS ACCOUNTS:
REGULAR SAVINGS               -  15,886
NOW ACCOUNT                   -  26,809
BUSINESS CHECKING             -     278   
IMF-MMDA                      -  11,578
FIRST RATE ACCOUNT            -       -
DOGWOOD CLUB                  -   4,000

TOTAL SAVINGS                 -  58,551

<PAGE>
      <PAGE>40          
<TABLE>
                                           CONDENSED GAP REPORT
12/31/95                                     CURRENT BALANCES
                                              (in thousands)

                                    DAILY     0-1        1-2      2-3          3-6      6-12
                         TOTAL    FLOATING   MONTHS     MONTHS   MONTHS       MONTHS  MONTHS 
<C>                      <S>        <S>      <S>        <S>      <S>      <S>      <S>
TIME DEPOSITS:     
CD 1 - 2 MONTHS           7,266       -        237      7,029         -        -       -
CD 3 MONTHS               1,367       -        775        173       403       15       1
CD 4 - 5 MONTHS             271       -        246         25         -        -       -
CD 6 MONTHS              23,965       -      5,101      2,991     3,332   12,439     102
CD 7 - 11 MONTHS          2,779       -      1,131        358       162      563     565
CD 12 MONTHS             16,396       -        817        353       645    5,399   9,180
CD 13 - 17 MONTHS           298       -          -          3         -      161     125
CD 18 - 23 MONTHS           634       -         65         50         3       32     254
CD 24 MONTHS             10,041       -        138      3,004     1,965    1,738     920
CD 25 - 30 MONTHS         6,442       -          6          -         -       42     140
CD 31 - 59 MONTHS        15,291       -        320        180       792    4,851   4,771
CD 31 - 59 MONTHS            
  VARIABLE                   87       -          -          -         -        -      12
CD 60 MONTHS              6,551       -         59        207       259      292   1,053
CD 60 MONTHS VARIABLE     1,087       -          -          -        15       23      80  
CD SWEET 16              33,381       -      3,669      2,481     3,708    5,801   8,948
CD 7 MONTH                2,123       -        628        388        58      268     781
IRA-FLOATING                179       -        179          -         -        -       -
IRA FIXED                20,788       -        791      1,286     1,296    2,435   3,604
CHRISTMAS CLUB               75       -          -          -         -        -      75

TOTAL TIME              149,021       -     14,162     18,528    12,638   34,059  30,611

TOTAL DEPOSITS          256,425  19,959     15,162     18,528    12,638   34,059  30,611

SHORT TERM BORROWINGS:
TT&L                        533       -          -          -         -        -       -
SECURITIES SOLD-SWEEP    14,844  14,844          -          -         -        -       -
SECURITIES SOLD-FIXED     6,381       -      2,960      1,890       600      278     268
FHLB-LIBOR INVESTMENT       936       -          -          -       936        -       -
FHLB-LONG TERM            2,061       -          -          -         -        -       -

TOTAL SHORT TERM BORR.   24,755  14,844      2,960      1,890     1,536      278     268

OTHER LIABILITIES:
OTHER LIABILITIES         2,276       -          -          -         -        -       -

TOTAL OTHER LIABILITIES   2,276       -          -          -         -        -       -

TOTAL LIABILITIES       283,456  34,803     18,122     20,418    14,174   34,337  30,879

CAPITAL:
STOCK, SURPLUS, P.I.C.    6,000       -          -          -         -        -       -
UNREALIZED GAIN (LOSSES)     96       -          -          -         -        -       -
UNDIVIDED PROFITS        21,612       -          -          -         -        -       -

TOTAL CAPITAL            27,708       -          -          -         -        -       -

TOTAL LIAB'S & CAPITAL  311,164  34,803     18,122     20,418    14,174   34,337  30,879

GAP (SPREAD)                  - -34,607     32,590    -12,430    -8,613  -17,609 -10,873
GAP % TOTAL ASSETS            -  -11.12      10.47      -3.99     -2.77    -5.66   -3.49
CUMULATIVE GAP                - -34,607     -2,017    -14,447   -23,060  -40,669 -51,542
CUM. GAP % TOTAL ASSETS       -  -11.12      -0.65      -4.64     -7.41   -13.07  -16.56
SENSITIVITY RATIO             -    0.01       0.96       0.80      0.74     0.67    0.66
</TABLE>
<PAGE>
      <PAGE>41
                          CONDENSED GAP REPORT
12/31/96                   CURRENT BALANCES
                             (in thousands)

                          1-2       2+    
                         YEARS     YEARS  
TIME DEPOSITS:     
CD 1 - 2 MONTHS               -       -        
CD 3 MONTHS                   -       -
CD 4 - 5 MONTHS               -       -
CD 6 MONTHS                   -       -
CD 7 - 11 MONTHS              -       -
CD 12 MONTHS                  2       -
CD 13 - 17 MONTHS             9       -
CD 18 - 23 MONTHS           230       -
CD 24 MONTHS              2,276       -
CD 25 - 30 MONTHS         4,109   2,145
CD 31 - 59 MONTHS         3,891     486
CD 31 - 59 MONTHS            
  VARIABLE                   75       -
CD 60 MONTHS              1,941   2,740
CD 60 MONTHS VARIABLE       303     666
CD SWEET 16               8,774       -
CD 7 MONTH                    -       -
IRA-FLOATING                  -       -
IRA FIXED                 4,038   7,338
CHRISTMAS CLUB                -       -

TOTAL TIME               25,648  13,375

TOTAL DEPOSITS           25,648  99,820

SHORT TERM BORROWINGS:
TT&L                          -     533
SECURITIES SOLD-SWEEP         -       -
SECURITIES SOLD-FIXED       385       -
FHLB-LIBOR INVESTMENT         -       -
FHLB-LONG TERM                -   2,061

TOTAL SHORT TERM BORR.      385   2,594

OTHER LIABILITIES:
OTHER LIABILITIES             -   2,276

TOTAL OTHER LIABILITIES       -   2,276

TOTAL LIABILITIES        26,033 104,690

CAPITAL:
STOCK, SURPLUS, P.I.C.      -   6,000
UNREALIZED GAIN (LOSSES)             96
UNDIVIDED PROFITS             -  21,612

TOTAL CAPITAL                 -  27,708

TOTAL LIAB'S & CAPITAL   26,033 132,398

GAP (SPREAD)             10,747  40,795
GAP % TOTAL ASSETS         3.45   13.11
CUMULATIVE GAP          -40,795       -
CUM. GAP % TOTAL ASSETS  -13.11       -
SENSITIVITY RATIO          0.77    1.00

                     NOTES TO THE GAP REPORT

1.    This gap report reflects interest sensitivity positions during a
      flat rate environment.  Time frames could change if rates rise or
      fall.

2.    Repricing over-rides maturity in various time frames.

3.    Demand deposits are placed in the last time frame due to lack of
      interest sensitivity.  Demand deposits are considered core deposits.

4.    Savings accounts are placed in the +2 year time frame.  In a flat
      rate environment, savings accounts generally do not reprice or
      liquidate. Savings deposits tend to be price sensitive, after a
      major increase in the 6 month CD rate.  These accounts are placed in 


      <PAGE>42

  the +2 year time frame as opposed to variable based on past
  historical trends. Savings accounts are considered core deposits.

5.    Subsidiaries as well as the Parent Company will adhere to providing
      above average margins and reviewing the various risks, if material.
      New products and services will be reviewed for the various risks by
      the Product Development Committee.

6.    Effective GAP management ensures minimal impact to net interest
      income in a volatile interest rate environment.  Financial markets
      are strained by rapid changes in rates, whether up or down.  When
      rates rise rapidly, net interest margins are squeezed. Rapidly
      decreasing rates have the potential to excessively stimulate loan
      demand, placing pressure on the bank's liquidity position.

RETURN ON EQUITY AND ASSETS
FIRST CITIZENS BANCSHARES, INC.
                                    1996    1995     1994   1993    1992 
 Percentage of Net Income to:
Average Total Assets                1.22%   1.00%   1.20%   1.17%   .95% 
Average Shareholders Equity        13.09%  10.60%  12.93%  13.48% 11.79% 
Percentage of Dividends Declared
 Per Common Share to Net Income
 Per Common Share                  32.28%  35.56%  29.23%  25.62% 27.67% 

Percentage of Average Shareholders'
 Equity to Average Total Assets     9.34%   9.32%   9.27%   8.71%  8.07% 


Return on assets is a measurement of the firms profitability in terms of
asset utilization.  Total assets at 12/31/96 were $313,000,000. Efforts
continue to focus on positioning the company for future growth and
profitability through improvements in technology, solid growth in the
deposit base and efficient utilization of the branch distribution
system.  Accelerated asset growth coupled with rising rates paid on
interest bearing deposits had a significant impact on earnings the first
half of 1995.  Results of operations for 1996 reflected significant
improvement. 

The company's strategic plan addresses objectives to sustain improved
earnings, maintain a quality loan and investment portfolio, seek fee
income opportunities and to maintain market share by providing quality
customer service.  The Bank's management and employees are rewarded with
incentive compensation based on the level of ROA achieved at year end. 
A return on assets of 1.25% or above is required if maximum benefits are
to be realized. The incentive program is being revised to challenge 
The staff by offering incrementally increased incentives based on a
return on assets up to 2%.

Percentage of dividends declared per common share to net income per
common share decreased 3.2% in 1996, the result of significantly
improved earnings.  Number of shares outstanding continues to increase
as a result of stock issued on a quarterly basis to service the Dividend
Reinvestment Program.  A stock repurchase program, approved by the Board
of Directors in 1994 for the purpose of acquiring shares on the open
market to service the Dividend Reinvestment Program continues to be
ineffective.  Shareholders continue to express an interest in buying
additional stock rather than selling shares.  Under the terms of the
repurchase program, the company will repurchase up to $200,000 of
Bancshares' stock in a calendar quarter on a first come, first served
basis. 

<PAGE>
      <PAGE>43

Total Capital (excluding Reserve for Loan Losses) as a percentage of
total assets is presented in the following table for years indicated:

CAPITAL RESOURCES/TOTAL ASSETS - YEAR-END TOTALS 
FIRST CITIZENS BANCSHARES, INC. 

    1996    1995       1994       1993      1992      

    9.46%   9.30%      9.30%      9.24%     8.05%     

Cash Dividends to Shareholders for 1996, 1995, and 1994 respectively
were $1.60,$1.30 and $1.19. Total shares outstanding were 741,516,
733,399, and 714,824 at 12/31/96, 1995 and 1994.  An Amendment to the
Articles of Association ratified by Shareholders in April, 1993 approved
an increase in number of shares authorized from 750,000 to 2,000,000. 
In September, 1993 a 2.5 for l stock split on the Common Capital Stock
of Bancshares was declared to holders of record as of October 15, 1993. 
The number of shares outstanding increased proportionately with changes
to the capital account.  In addition, a 10% stock dividend was declared
payable December 15, 1992 which provided for issuance of one share of
stock for each 10 shares owned, with payment of fractional shares being
made in cash.  25,158 shares were issued as a result of the dividend.

Risk-based capital focuses primarily on broad categories of credit risk
and incorporates elements of transfer, interest rate and market risks.
The calculation of risk-based capital ratio is accomplished by dividing
qualifying capital by weighted risk assets.  The minimum risk-based
capital ratio is 8.00%.  At least one-half or 4.00% must consist of core
capital (Tier 1), and the remaining 4.00% may be in the form of core
(Tier 1) or supplemental capital (Tier 2).  Tier 1 capital/core capital
consists of common stockholders equity, qualified perpetual preferred
stock and minority interests in consolidated subsidiaries.  Tier 2
capital/supplementary capital consists of the allowance for loan and
lease losses, perpetual preferred stock, term subordinated debt, and
other debt and stock instruments.

Bancshares has historically maintained capital in excess of minimum
levels established by the Federal Reserve Board.  The risk-based capital
ratio for Bancshares as of 12/31/96 and 12/31/95 was 14.72 percent and
14.05 percent respectively, significantly above the 8.0 percent level
required by regulation.  With the exception of the Reserve for Loan and
Lease Losses, all capital is Tier 1 level.  Growth in capital will be
maintained through retained earnings.  There is no reason to assume that
income levels will not be sufficient to maintain an adequate capital
ratio. 

<PAGE>
      <PAGE>44


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA

                           Independent Auditors' Report 

Board of Directors 
First Citizens Bancshares, Inc. 
Dyersburg, Tennessee  38024 

We have audited the accompanying consolidated balance sheets of First
Citizens Bancshares, Inc., and Subsidiary as of December 31, 1996 and
1995, and the related consolidated statements of income, stockholders'
equity, and cash flows for each of the three years ended December 31,
1996.  These financial statements are the responsibility of the
Corporation'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 audit
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 financial statements referred to above present
fairly, in all material respects, the financial position of First
Citizens Bancshares, Inc., and Subsidiary as of December 31, 1996 and
1995, and their results of operations and cash flows for the three years
ended December 31, 1996, in conformity with generally accepted
accounting principles.



Dyersburg, Tennessee
January 22, 1996


                     Carmichael, Dunn, Creswell & Sparks CPAs
<PAGE>
     <PAGE>45          
                       FIRST CITIZENS BANCSHARES, INC.,
                             AND SUBSIDIARY
                        CONSOLIDATED BALANCE SHEETS
                        December 31, 1996 and 1995

                                                       1996          1995
    ASSETS
Cash and due from banks - Note 12                  $ 12,507,293 $ 11,694,413
Federal funds sold                                    1,000,000    1,850,000  
  Investment securities - Notes 1 and 2
  Securities held-to-maturity (fair value of 
  $28,097,406 at December 31, 1996 and 
  $34,258,371 at December 31, 1995)                  28,059,382   33,947,383
   Securities available-for-sale, at fair value      47,687,500   39,943,942
 Loans - Notes 1 and 3 (net of unearned income of
   $1,520,885 in 1996 and $1,657,033 in 1995)       211,389,096  191,906,433
   Less:  Allowance for loan losses - Notes 1 & 4     2,282,231    2,216,511 
     Net Loans                                      209,106,865  189,689,922
Premises and equipment - Notes 1 and 5                8,135,023    8,830,533
Accrued interest receivable                           3,697,639    3,951,100
Other assets - Notes 1 and 6                          2,877,297    1,504,603

     TOTAL ASSETS                                  $313,070,999 $291,411,896  

LIABILITIES AND STOCKHOLDERS' EQUITY

 Liabilities
 Deposits - Note 7
   Demand                                            27,882,403   26,131,710
   Time                                             149,023,682  140,713,180
   Savings                                           79,507,938   70,315,491
Total Deposits                                      256,414,023  237,160,381
Securities sold under agreement to 
  repurchase - Note 16                               21,225,315   19,744,966
Long-term debt - Note 15                              2,996,480    4,651,903
Other liabilities - Note 22                           2,831,975    2,751,409
     Total Liabilities                              283,467,793  264,308,659 

Stockholders' Equity
 Common stock, par value $1; shares 
 authorized 2,000,000 Issued and outstanding 
 - 741,516 shares in 1996
 733,399 shares in 1995                                 741,516      733,399
Surplus                                              10,096,882    9,719,966
Retained earnings                                    18,678,876   16,166,392
Unrealized gain (loss) on securities 
   available-for-sale, net of applicable 
   deferred income taxes                                 94,600      485,271
   Less treasury stock, at cost 40 shares in 1996; 
   3 shares in 1995                                      (8,668)      (1,781)
   Total Stockholders' Equity                        29,603,206   27,103,237

    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY     $313,070,999 $291,411,896



    See accompanying notes to consolidated financial statements.

<PAGE>
     <PAGE>46

                                      FIRST CITIZENS BANCSHARES, INC.,
                                             AND SUBSIDIARY
                                     CONSOLIDATED STATEMENTS OF INCOME
                                 Years ended December 31, 1996, 1995, 1994

                                         1996         *1995           *1994
    Interest Income   

Interest and fees on loans           $19,769,117   $17,720,050    $14,619,684
Interest and dividends on 
  investment securities:
    Taxable                            4,254,795     4,029,277      2,950,541
    Tax-exempt                           497,826       482,209        598,515
    Dividends                            180,794        61,928        160,085
Other interest income                     76,846       197,635        113,435
Lease financing income                       338         1,487          4,271
    Total Interest Income             24,779,716    22,492,586     18,446,531

    Interest Expense

Interest on deposits                  10,601,172    10,039,401      7,106,421
Interest on long-term debt               395,514       347,683        233,659
Other interest expense                   962,014       794,169        631,006
    Total Interest Expense            11,958,700    11,181,253      7,971,086
Net Interest Income                   12,821,016    11,311,333     10,475,445
Provision for loan losses - Note 4       608,505       364,449        402,000
Net interest income after provision 
 for loan losses                      12,212,511    10,946,884     10,073,445

    Other Income

Income from fiduciary activities         745,861       704,726        625,293
Service charges on deposit accounts    1,456,681     1,304,523      1,116,456
Other service charges, commissions,
   and fees                              605,305       464,879        703,599
Securities gains (losses) - net - 
  Note 2                                 211,233        59,644        (69,534)
Other income                             349,407       186,137        494,996
    Total Other Income                 3,368,487     2,719,909      2,870,810

    Other Expenses

Salaries and employee benefits 
  - Note 8                             5,497,388     5,171,955      4,970,061
Net occupancy expenses                   445,720       340,663        317,614
Furniture and equipment expense          146,388       154,680        144,805
Depreciation                           1,011,677       930,292        823,599
Data processing expense                  304,451       227,812        177,288
Legal and professional fees              161,261       280,155         86,818
Stationary and office supplies           238,000       204,794        146,685
Other expenses                         2,032,839     2,317,900      2,143,276
    Total Other Expenses              $9,837,724    $9,628,251     $8,810,146

Net income before income taxes        $5,743,274    $4,038,542     $4,134,109

Provision for income tax expense 
  - Note 9                             2,033,370     1,332,886      1,187,860

Net Income                            $3,709,904    $2,705,656     $2,946,249

Earnings Per Common Share - Note 10:

  Net income                                5.03          3.72           4.15

Weighted average shares outstanding   $  736,436    $  726,489     $  709,434

*Certain items have been reclassified to conform to current years format.


    See accompanying notes to consolidated financial statements.
<PAGE>
      <PAGE>47
<TABLE>
                                                    FIRST CITIZENS BANCSHARES, INC.,
                                                            AND SUBSIDIARY
                                                CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                                 Years Ended December 31, 1996, 1995 and 1994
                                                                                                      Unrealized 
                                                                                                    Gain(Loss) on
                                                                                               Securities Available
                                                                                            For Sale Net of Applicable
                                                   Common Stock                                  Deferred Income 
                                          Shares     Amount    Surplus        Retained Earnings      Taxes       Treasury Stock
<S>                                       <C>      <C>         <C>              <C>                   <C>          <CS>
Balance, January 1, 1994                  706,656  $7,066,560  $2,356,082       $12,338,242           $            $  (60,407)

Net income, year ended December 31, 1994                                          2,946,249
Cash dividends paid - $1.19 per share                                              (861,407)
Conversion of par value of 
  common stock
 from $10 to $1 - Note 10                          (6,378,246)  6,378,246
Sale of common stock                        8,168      26,510     265,710
Adjustment to record unrealized 
  gain(loss) in securities available-
  for-sale, net of applicable deferred 
  income taxes effective January 1, 
  1995 - Note 2                                                                                          94,696

Adjustment of unrealized gain(loss) 
  on securities available-for-sale, 
  net of applicable deferred
  income taxes during the year - Note 2                                                                (354,239)

Treasury stock transactions-net                                        447                                              60,305

Balance, December 31, 1994                714,824      714,824   9,000,485        14,423,084            (259,543)         (102) 

Net income, year ended December 31, 1995                                                           2,705,656
Cash dividends paid - $1.30 per share                                                               (962,348)
Sale of common stock                       18,575       18,575     719,315
Adjustment of record unrealized gain(loss) 
 in securities available-for-sale, net of 
 applicable deferred income taxes effective
 January 1, 1995 - Note 2                                                                                    744,814
Treasury stock transactions-net                                        156                                              (1,679) 

Balance, December 31, 1995                733,399      733,399   9,719,956        16,166,392             485,271        (1,781)

Net income, year ended December 31, 1996                                           3,709,904
Cash dividends paid - $1.60 per share                                             (1,197,420)
Sale of common stock                        8,117        8,117     376,926
Adjustment of unrealized gain (loss) 
  on securities available-for-sale, net of 
  applicable deferred income taxes during 
  the year                                                                                              (390,671)
Treasury stock transaction-net                                                                                          (6,887)

Balance, December 31, 1996                741,516  $   741,516 $10,096,882       $18,678,876         $    94,600     $  (8,668) 
</TABLE>
   See accompanying notes to consolidated financial statements.
<PAGE>
     <PAGE>48    

                           FIRST CITIZENS BANCSHARES, INC.,
                                AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF CASH FLOW
                     Years ended December 31, 1996, 1995, and 1994

                                                 1996        1995        1994
         Operating Activities

Net income                                  $3,709,904  $2,705,656  $2,946,249
Adjustments to reconcile net income to net
 cash provided by operating activities:
   Provision for loan losses                   608,505     364,449     402,000
   Provision for losses on other real estate                 53,404
   Provision for depreciation                1,011,677     930,292     823,599
   Amortization of investment security 
    discounts                                                (3,000)
   Deferred income taxes                      (319,360)    (61,538)   (31,737)
   (Gains) losses on sale of other real estate               36,004        
   Realized and unrealized investment 
     security (gains) losses                  (211,233)    (59,644)     69,534
   (Increase) decrease in accrued 
     interest receivable                       253,461    (949,763)   (428,668)
   (Increase) decrease in accrued 
     interest payable                          (67,981)    732,857      
   Increase (decrease) in other assets      (1,053,334)    118,877   1,151,106
   Increase (decrease) in other liabilities    148,547    (169,629)   (171,424)

        NET CASH PROVIDED BY 
        OPERATING ACTIVITIES                 4,080,186   3,697,965   4,760,659

    Investing Activities

Proceeds of maturities of held-to-
  maturity investment securities             6,335,363   7,160,748  19,405,141
Purchases of held-to-maturity investment 
  securities                                (1,500,000)            (17,780,040)
Proceeds of sales and maturities of available-
  for-sale investment securities            13,705,781  11,639,381   5,109,625
Purchases of available-for-sale investment 
  securities                               (20,576,139)(27,718,689)(10,625,663)
Increase in loans - net                    (20,025,448)(23,326,723)(19,483,603)
Purchase of premises and equipment            (316,167) (1,368,626) (1,588,847)

       NET CASH PROVIDED (USED)
       BY INVESTING ACTIVITIES             (22,376,610)(33,613,909)(24,963,387)


      Financing Activities

Net increase (decrease) in demand deposits,
  NOW accounts and savings accounts        $10,061,195 $ 3,557,638 $ 4,255,599
Increase (decrease) in time deposits-net     9,192,447  24,122,492  11,401,403
Increase in long-term borrowing                            527,173   4,124,730
Payment of principal on long-term debt      (1,655,423)                 (30,021)
Proceeds from sale of common stock             385,043     737,890     292,220 
Cash dividends paid                         (1,197,420)   (962,348)   (861,407)
Net increase (decrease) in short-term
  borrowings                                 1,480,349   2,794,880      35,944
Treasury stock transactions-net                 (6,887)     (1,523)     60,752 

     NET CASH PROVIDED BY
     FINANCING ACTIVITIES                   18,259,304  30,776,202  19,279,220

    INCREASE (DECREASE) IN CASH AND 
       CASH EQUIVALENTS                        (37,120)    860,258    (923,508)

Cash and cash equivalents at 
   beginning of year                        13,544,413  12,684,155  13,607,663

    CASH AND CASH EQUIVALENTS AT
         END OF YEAR                       $13,507,293 $13,544,413  $12,684,155

Cash payments made for interest and income taxes during the years presented 
are as follows:

                                                 1996       1995         1994
     Interest                              $11,997,839  $10,448,396 $ 7,838,662
     Income taxes                            1,972,000    1,567,316   1,260,380

    See accompanying notes to consolidated financial statements.



<PAGE>
     <PAGE>49
                FIRST CITIZENS BANCSHARES, INC.,
                         AND SUBSIDIARY
                 NOTES TO FINANCIAL STATEMENTS
                       December 31, 1996

Note 1 - Summary of Significant Accounting and Reporting
Policies

The accounting and reporting policies of First Citizens
Bancshares, Inc., and Subsidiary conform to generally accepted
accounting principles.  The significant policies are described
as follows:

BASIS OF PRESENTATION

The consolidated financial statements include all accounts of
First Citizens Bancshares, Inc., and First Citizens National
Bank.  First Citizens Bancshares, Inc.'s, investment in its
Subsidiary shown on the Parent Company Balance Sheet, is
stated at equity in the underlying assets.  All significant
inter-company items are eliminated in consolidation.

NATURE OF OPERATIONS
The Company and its subsidiary provide commercial banking
services of a wide variety to individual corporate customers
in the Mid-Southern United States with a concentration in
northwest Tennessee.  The Company's primary products are
checking and savings deposits and residential, commercial and
consumer lending.

BASIS OF ACCOUNTING
The consolidated financial statements are presented using the
accrual basis of accounting.

USES 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 from those
estimates.

Material estimates that are particularly susceptible to
significant change relate to the determination of the
allowance for losses on loans and the valuation of real estate
acquired in connection with foreclosures or in satisfaction of
loans.  In connection with the determination of the allowances
for losses on loans and foreclosed real estate, management
obtains independent appraisals for significant properties.

CASH EQUIVALENTS
Cash equivalents include amounts due from banks which do not
bear interest and federal funds sold.  Generally, federal
funds are purchased and sold for one day periods.

SECURITIES
Effective January 1, 1995, the Company adopted Statement No.
115 of the Financial Accounting Standards Board according to
which investment securities are classified as follows:

Held-to-maturity which includes those investment securities
which the Company has the intent and the ability to hold until
maturity;

      <PAGE>50

                FIRST CITIZENS BANCSHARES, INC.,
                         AND SUBSIDIARY
           NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                       December 31, 1996

Note 1 - Summary of Significant Accounting and Reporting
Policies (Continued)

Trading securities which includes those investment securities
which are held for short-term resale; and Available-for-sale
which includes all other investment securities.

Securities which are held-to-maturity are reflected at cost,
adjusted for amortization of premiums and accretion of
discounts using methods which approximate the interest method. 
Securities which are available-for-sale are carried at fair
value, and unrealized gains and losses are recognized as
direct increases or decreases in stockholders' equity. 
Trading securities, where applicable, are carried at fair
value, and unrealized gains and losses on these securities are
included in net income. 

Realized gains and losses on investment securities
transactions are determined based on the specific
identification method and are included in net income.

LOANS
Loans are reflected on the balance sheet at the unpaid
principal amount less the allowance for loan losses and
unearned income.

Loans are generally placed on non-accrual status when, in the
judgment of management, the loans have become impaired. 
Unpaid interest on loans placed on non-accrual status are
reversed from income and further accruals of income are not
usually recognized.  Subsequent collections related to
impaired loans are usually credited first to principal and
then to previously uncollected interest.

ALLOWANCE FOR LOAN LOSSES
The provision for loan losses which is charged to operations
is based on management's assessment of the quality of the loan
portfolio, current economic conditions and other relevant
factors.  In management's judgment, the provision for loan
losses will maintain the allowance for loan losses at adequate
level to absorb potential loan losses which may exist in the
portfolio.

PREMISES AND EQUIPMENT
Bank premises and equipment are stated at cost less
accumulated depreciation.  The provision for depreciation is
computed using straight-line and accelerated methods for both
financial reporting and income tax purposes.  Expenditures for
maintenance and repairs are charged against income as
incurred.  Cost of major additions and improvements are
capitalized and depreciated over their estimated useful lives.

REAL ESTATE ACQUIRED BY FORECLOSURE
Real estate acquired through foreclosure is reflected in other
assets and is recorded at the lower of fair value less
estimated costs to sell or cost.  Adjustments made at the date
of foreclosure are charged to the allowance for loan losses.  



      <PAGE>51

                FIRST CITIZENS BANCSHARES, INC.,
                         AND SUBSIDIARY
           NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                       December 31, 1996

Note 1 - Summary of Significant Accounting and Reporting
Policies (Continued)

Expenses incurred in connection with ownership, subsequent
adjustments to book value, and gains and losses upon
disposition are included in other non-interest expenses.

Adjustments to net realizable value are made annually
subsequent to acquisition based on appraisal.

INCOME TAXES
First Citizens Bancshares, Inc., uses the accrual method of
accounting for federal income tax reporting.  Deferred tax
assets or liabilities are computed for significant differences
in financial statement and tax basis of assets and liabilities
which result from temporary differences in financial statement
and tax accounting.

INTEREST INCOME ON LOANS
Interest income on commercial and real estate loans is
computed on the basis of the daily principal balance
outstanding using the accrual method.  Interest on installment
loans is credited to operations by the rule of 78ths method,
which does not represent a significant financial deviation 
from the interest method.

NET INCOME PER SHARE OF COMMON STOCK
Net income per share of common stock is computed by dividing
net income by the weighted average number of shares of common
stock outstanding during the period, after giving retroactive
effect to stock dividends and stock splits.

INCOME FROM FIDUCIARY ACTIVITIES
Income from fiduciary activities is recorded on the accrual
basis.
<PAGE>
     <PAGE>52
                FIRST CITIZENS BANCSHARES, INC.,
                         AND SUBSIDIARY
           NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                       December 31, 1996


Note 2 - Investment Securities

At January 1 1995, First Citizens Bancshares, Inc. adopted
Statement No. 115 of the Financial Accounting Standards Board
which sets forth criteria for classification of investment
securities for financial statement purposes.  The following
tables reflect amortized cost, unrealized gains, unrealized
losses and fair value of investment securities for the balance
sheet dates presented, segregated into held-to-maturity and
available-for-sale categories:
<TABLE>
                                                      December 31, 1996

                                                       Held-To-Maturity
                                                     Gross          Gross
                                                   Unrealized     Unrealized   
                                 Amortized Cost      Gains          Losses      Fair Value
<S>                                 <C>              <C>            <C>         <C>  
U.S. Treasury securities and 
 obligations of U.S. government 
 corporations and agencies          $19,032,226      $127,208       $115,164    $19,044,207

Obligations of states and 
 political subdivisions               6,248,290        19,858         13,123      6,255,025

Mortgage-backed securities            2,278,566        26,277          8,027      2,296,816
Corporate debt securities               500,300           995                       501,295

  TOTAL SECURITIES INVESTMENTS      $28,059,382      $174,338       $136,314    $28,097,406

                                                      Available-for-Sale
                                                     Gross          Gross
                                                   Unrealized     Unrealized   
                                  Amortized Cost     Gains          Losses       Fair Value

U.S. Treasury securities and 
 obligations of U.S. government 
 corporations and agencies          $33,730,315       $342,752      $203,894    $33,869,173

Obligations of states and 
 political subdivisions               4,312,448         20,757        12,038      4,321,167

Mortgage-backed securities            7,011,620         52,274        50,434      7,013,460

      Total Debt Securities          45,054,383        415,783       266,366     45,203,800

  Equity investments                  2,475,450          8,250                    2,483,700

  TOTAL SECURITY INVESTMENT         $47,529,833       $424,033      $266,366    $47,687,500
</TABLE>

<PAGE>
      <PAGE>53

                       FIRST CITIZENS BANCSHARES, INC.,
                               AND SUBSIDIARY
                   NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                             December 31, 1996

Note 2 - Investment Securities (Continued)
<TABLE>
                                                     December 31, 1995
                                                      Held-To-Maturity
                                                     Gross          Gross
                                                   Unrealized     Unrealized   
                                  Amortized Cost     Gains          Losses       Fair Value
<S>                                <C>               <C>          <C>           <C>
U.S. Treasury securities and 
 obligations of U.S. government 
 corporations and agencies         $23,704,060       $358,117     $ 87,616      $23,974,561

Obligations of states and 
 political subdivisions              6,569,421         33,373       19,955        6,582,839

Mortgage-backed securities           2,678,582         30,592        7,327        2,701,847
Corporate debt securities              995,320          3,804                       999,124

    TOTAL SECURITIES INVESTMENTS   $33,947,383       $425,886     $114.898      $34,258,371

                                                   
                                                      Available-For-Sale
                                                     Gross          Gross
                                                   Unrealized     Unrealized   
                                  Amortized Cost     Gains          Losses       Fair Value

U.S. Treasury securities and 
 obligations  of U.S. government 
 corporations and agencies          $26,088,212     $721,405      $  8,748      $26,800,869

Obligations of states and 
 political subdivisions               4,190,086       31,773         1,535        4,206,324

Mortgage-backed securities            6,230,808       86,988        39,925        6,277,871

Corporate debt securities               250,000        2,078                        252,078

        Total Debt Securities        36,759,106      842,244        64,208       37,537,142

    Equity investments                2,376,050       30,750                      2,406,800

     TOTAL SECURITIES INVESTMENT    $39,135,156     $872,994       $64,208      $39,943,942
</TABLE>
<PAGE>
      <PAGE>54
                       FIRST CITIZENS BANCSHARES, INC.,
                               AND SUBSIDIARY
                   NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                             December 31, 1996

Note 2 - Investment Securities (Continued)

The tables below summarize maturities of debt securities held-to-maturity
and available-for-sale  as of December 31, 1996 and 1995:
<TABLE>
                                                December 31, 1996

                                     Securities                    Securities
                                  Held-To-Maturity             Available-For-Sale
                           Amortized Cost   Fair Value   Amortized Cost   Fair Value
<S>                          <C>            <C>            <C>            <C> 
Amounts Maturing In:

One Year or less             $ 8,410,816    $ 8,582,245    $ 3,494,077    $ 3,499,555
After one year through 
 five years                   14,674,677     14,710,573     12,124,981     12,275,220
After five years through 
 ten years                     3,726,901      3,692,240     14,983,046     15,125,707
After ten years                1,246,988      1,112,348     14,452,279     14,303,318
                             $28,059,382    $28,097,406    $45,054,383    $45,203,800


                                                December 31, 1995

                                     Securities                    Securities
                                 Held-To-Maturity              Available-For-Sale
                          Amortized Cost    Fair Value   Amortized Cost   Fair Value
Amounts Maturing In:

One Year or less            $ 9,637,185     $ 9,644,453    $14,756,019    $14,851,381
After one year through 
  five years                 23,051,250      23,355,974     18,944,304     19,414,850
After five years through 
  ten years                     260,857         258,349      2,883,783      3,092,877
After ten years                 998,091         999,595        175,000        178,034 
                            $33,947,383     $34,258,371    $36,759,106    $37,537,142
</TABLE>
Securities gains (losses) presented in the consolidated statements of income 
consist of the following:


Year Ended December 31               Gross Sales   Gains   Losses        Net

1996 - Trading securities            $  150,000  $    750  $       $      750
1996 - Securities held-to-maturity    6,335,663    43,003              43,300  
1996 - Securities available-for-sale 13,705,781   179,583   12,103    167,480
1995 - Securities held to maturity    2,150,000     7,261    5,189      2,072
1995 - Securities available-for-sale  9,379,381    57,604       32     57,572
1994 - Securities available-for-sale  5,109,625             69,534    (69,534)

Sales of securities classified as held-to-maturity consist of securities 
which were called resulting in a gain or loss or sold within ninety days of 
maturity.

At December 31, 1996 and 1995, investment securities were pledged to secure 
government, public and trust deposits as follows:

         December 31                           Amortized Cost    Fair Value
            1996                               $24,657,408        $24,695,742
            1995                                38,480,063         39,548,513   
                     


In accordance with provisions of the Implementation Guide of Statement No. 115
issued by the Financial Accounting Standards Board, First Citizens Bancshares, 
Inc. transferred securities with a book value of $14,824,727 from the held-to-
maturity category to available-for-sale category during 1996.  An unrealized 
gain of $549,287 was recognized on these securities.

<PAGE>
      <PAGE>55
                FIRST CITIZENS BANCSHARES, INC.,
                         AND SUBSIDIARY
           NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                       December 31, 1996

Note 3 - Loans

Loans outstanding at December 31, 1996 and 1995 were comprised of the
following:
                                               1996              1995
                                                   (In Thousands)
Commercial, financial and agricultural       $ 42,067          $ 45,061    
Real estate - construction                     17,130            12,954    
Real estate - mortgage                        127,080           107,844
Installment                                    22,743            23,718
Other loans                                     2,369             2,330     
                                              211,389           191,907 
Less:  Allowance for loan losses                2,282             2,217     
                                            $ 209,107          $189,690


In conformity with Statement No. 114 of the Financial
Accounting Standards Board, the Corporation has recognized
loans with carrying values of $1,539,000 at December 31, 1996,
and $836,000 at December 31, 1995, as being impaired. The
balance maintained in the Allowance for Loan Losses related to
these was $132,230 at December 31, 1996, and $216,166 at
December 31, 1995.

Note 4 - Allowance for Loan Losses

An analysis of the allowance for loan losses during the three
years ended December 31 is as follows:
 
                                        1996         1995       1994  
Balance, beginning of period        $2,216,511  $2,053,843  $1,676,133  
Provision for loan losses charged 
  to operations                        608,505     364,449     402,000  
Loans charged to allowance, 
  net of loan loss recoveries of 
  $137,566, $164,148, and $162,474    (542,785)   (201,781)    (24,290)
Balance, end of period              $2,282,231  $2,216,511  $2,053,843

For tax purposes, the Corporation deducts the maximum amount allowable. 
During the year ended December 31, 1996, the deduction taken was
$542,785.  The deductions for tax purposes in 1995 and 1994 were
$235,971 and $13,182, respectively.

Note 5 - Premises and Equipment

The fixed assets used in the ordinary course of business are summarized
as follows: 

                         Useful Lives
                           in Years        1996            1995  
Land                                    $1,114,046     $ 1,114,046
Buildings                  5 to 50       7,839,273       7,814,847
Furniture and equipment    3 to 20       7,115,619       6,868,553
                                        16,068,938      15,797,446
Less:  Accumulated depreciation          7,933,915       6,966,913
                                       $ 8,135,023     $ 8,830,533
 



<PAGE>
      <PAGE> 56

                     FIRST CITIZENS BANCSHARES, INC.,
                              AND SUBSIDIARY
                NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                            December 31, 1996

During 1995, First Citizens National Bank acquired real estate in
Dyersburg, Tennessee, as a site for a new branch banking facility at a
cost of $337,023.  The new branch was constructed during the year and
placed in service at a total cost of building and equipment of $680,406.

Note 6 - Repossessed Real Property

The book value of repossessed real property on the balance sheet is
$50,000 at December 31, 1996 and $722,004 at December 31, 1995.  At
December 31, 1995, the book value of repossessed real estate included
certain commercial real estate which First Citizens National Bank
acquired through foreclosure and which was sold to First Citizens
Bancshares, Inc. as of December 31, 1991.  The property had a cost basis
of $650,000.  During the year ended December 31, 1996, the property was
sold at a loss of $18,349. During the years ended December 31, 1996 and
1995, the property was rented and produced rental income of $93,968 and
$129,143, respectively.

The balance of repossessed real property is reflected on the balance
sheet of First Citizens Bancshares, Inc. and is carried in "other
assets."

Note 7 - Deposits

Included in the deposits shown on the balance sheet are the following
time deposits and savings deposits in denominations of $100,000 or more:

                                 1996                 1995
                                       (In Thousands)

Time Deposits                   $38,181               $26,706            
Savings Deposits                 44,396                22,557            
 

NOW accounts, included in savings deposits on the balance sheet, totaled
$26,809,062 at December 31, 1996 and $25,823,300 at December 31, 1995.

First Citizens National Bank routinely enters into deposit relationships
with its directors, officers and employees in the normal course of
business. These deposits bear the same terms and conditions as those
prevailing at the time for comparable transactions with unrelated
parties.  At December 31, 1996, executive officers and directors of the
Bank had deposits with a total outstanding balance of $3,895,000.

Note 8 - Employee Stock Ownership Plan

First Citizens National Bank maintains the First Citizens National Bank
of Dyersburg Employee Stock Ownership Plan as an employee benefit.  The
plan provides for a contribution annually not to exceed twenty-five
percent of the total compensation of all participants and affords
eligibility for participation to all full-time employees who have
completed at least one year of service.  Contributions to the Employee
Stock Ownership Plan totaled $399,138 in 1996, $390,252 in 1995, and
$375,914 in 1994.







      <PAGE>57

                     FIRST CITIZENS BANCSHARES, INC.,
                              AND SUBSIDIARY
                NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                            December 31, 1996


Note 9 - Income Taxes

Provision for income taxes is comprised of the following:

                                       1996         1995       1994
Federal income tax expense(benefit)          
  Current                           $1,712,398  $ 1,144,344 $1,081,655  
  Deferred                             (22,344)     (52,308)  (137,851)
                                                             
State income tax expense(benefit)                           
  Current                              347,259      250,090    314,088
  Deferred                              (3,943)      (9,230)   (70,032)
                                                                         
                                    $ 2,033,370  $1,332,896 $1,187,860

The ratio of applicable income taxes to net income before income taxes
differed from the statutory rates of 34%.  The reasons for these
differences are as follows:

                                       1996         1995       1994  
Tax expense at statutory rate       $1,952,713   $1,373,104  $1,405,597
Increase (decrease) resulting from:                       
 State income taxes, net of 
  federal income tax benefit           226,589      158,968     143,500
Tax exempt income                     (172,142)    (219,247)   (212,477) 
Other differences                       26,210       20,061    (148,760)
                                    $2,033,370   $1,332,886  $1,187,860


Deferred tax liabilities have been provided for taxable temporary
differences related to depreciation, accretion of securities discounts
and other minor items.  Deferred tax assets have been provided for
deductible temporary differences related primarily to the allowance for
loan losses and adjustments for loss on repossessed real estate.  The
net deferred tax assets in the accompanying consolidated balance sheets
include the following components:
                                                 December 31     

                                           1996              1995
Deferred tax liabilities                $( 63,817)         $(251,125)
Deferred tax assets                       318,052            186,000

Net deferred tax assets                 $ 254,235          $ (65,125)

Note 10- Common Stock Par Value

During the year ending December 31, 1995, the Company's Board of
Directors voted to reduce par value of the Company's capital stock from
$10 to $1.  The transaction was recorded on June 30, 1995, and involved 
a transfer from capital stock to surplus in the amount of $6,378,246.

The Board of Directors also voted to increase the Company's number of
shares authorized from 750,000 to 2,000,000.

<PAGE>
      <PAGE>58

                     FIRST CITIZENS BANCSHARES, INC.,
                              AND SUBSIDIARY
                NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                            December 31, 1996

    
Note 11- Regulatory Matters

First Citizens National 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. The regulations require the Bank to meet specific capital
adequacy 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 classification
is also subject to qualitative judgements 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 Tier 1 capital (as defined in the
regulations) to total average assets (as defined), and minimum ratios of
Tier 1 and total capital (as defined) to risk-weighted assets (as
defined).  To be considered adequately capitalized (as defined) under
the regulatory framework for prompt corrective action, the Bank must
maintain minimum Tier 1 leverage, Tier 1 risk-based, total risk-based
ratios as set forth in the table. The Bank's actual capital amounts and
ratios are also presented in the table.

                                                          To Be Well
                                                       Capitalized Under
                                     For Capital       Prompt Corrective
                     Actual       Adequacy  Purposes   Action Provisions
Amount          Amount      Ratio  Amount      Ratio    Amount     Ratio
As of 12/31/96:
Total Capital  $27,708,459 13.0%  $17,063,040 > 8.0% $21,328,800 > 10.0%
(To Risk Weighted Assets)
Tier 1 Capital  27,486,916 12.9%    8,531,520 > 4.0%  12,797,280 >  6.0%
(To Risk Weighted Assets)
Tier 1 Capital  27,486,916  8.8%   12,445,400 > 4.0%  15,556,750 >  5.0%
(To Average Assets)

As of 12/31/95:
Total Capital  $24,531,039 12.12% $16,192,240 > 8.0% $20,242,800 > 10.0%
(To Risk Weighted Assets)
Tier 1 Capital  24,391,840 12.05%   8,097,120 > 4.0%  12,145,680 >  6.0%
(To Risk Weighted Assets)
Tier 1 Capital  24,391,840  8.7%   11,151,157 > 4.0%  13,938,946 >  5.0%
(To Average Assets)

Note 12 - Restrictions on Cash and Due From Bank Accounts

The Corporation's bank subsidiary maintains cash reserve balances as
required by the Federal Reserve Bank.  Average required balances during
1996 and 1995 were $173,000 and $161,000, respectively.

<PAGE>
      <PAGE>59


                     FIRST CITIZENS BANCSHARES, INC.,
                              AND SUBSIDIARY
                NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                            December 31, 1996
     
Note 13 - Restrictions on Capital and Payment of Dividends

The Corporation is subject to capital adequacy requirements imposed by
the Federal Reserve Bank.  In addition, the Corporation's National Bank
Subsidiary is restricted by the Office of the Comptroller of the
Currency from paying dividends in any years which exceed the net
earnings of the current year plus retained profits of the preceding two
years.  As of December 31, 1996, approximately $7.5 million of retained
earnings was available for future dividends from the subsidiary to the
parent corporation.

Note 14 - Condensed Financial Information

                           First Citizens Bancshares, Inc.
                                (Parent Company Only)
                                                        December 31
                                                     1996          1995
                            BALANCE SHEETS

ASSETS
Cash                                              $ 1,451,161   $   728,839   
 Investment securities, available-for-sale-at  
   fair value                                         198,125     1,098,778
    Investment in subsidiary                       27,708,459    24,531,039
    Real estate owned                                 164,181       824,134
    Other assets                                      103,389        30,577
    TOTAL ASSETS                                   29,625,315    27,213,367

LIABILITIES AND STOCKHOLDERS' EQUITY
   LIABILITIES
Accrued expenses                                       22,109       110,130
TOTAL LIABILITIES                                      22,109       110,130

STOCKHOLDERS' EQUITY                               29,603,206    27,103,237
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY        $29,625,315   $27,213,367

                          STATEMENTS OF INCOME
                                                        December 31
                                                     1996          1995
INCOME
Dividends from bank subsidiary                    $   165,000   $   214,800    
  Other income                                        188,865       313,608
TOTAL INCOME                                          353,865       528,408

EXPENSES
  Other expenses                                      192,489       137,301
TOTAL EXPENSES                                        192,489       137,301

Income before income taxes and equity 
 in undistributed net income of bank subsidiary       161,376       391,107 

Income tax expense (benefit)                           18,100        62,891
                                                      143,276       328,216
Equity in undistributed net income of 
 bank subsidiary                                    3,566,628     2,377,440

  NET INCOME                                       $3,709,904    $2,705,656


<PAGE>
      <PAGE>60
                         FIRST CITIZENS BANCSHARES, INC.,
                                 AND SUBSIDIARY
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                           December 31, 1996 and 1995


Note 14 - Condensed Financial Information (Continued)
    (Parent Company Only)

                     STATEMENTS OF CASH FLOW
                                                       December 31
                                                   1996           1995
      Operating Activities
Net income                                       $3,709,904    $2,705,656
Adjustments to reconcile net income to net cash
  provided by operating activities:
    Depreciation                                     27,415        28,282
    Undistributed income of subsidiary           (3,566,628)   (2,377,440)
    Gain(Loss) on sale of other real estate          18,349         
    (Increase) decrease in other assets             (98,186)       53,483
    Increase (decrease) in other liabilities        (88,021)      (44,952)

     NET CASH PROVIDED BY OPERATING ACTIVITIES        2,833       365,029

     Investing Activities
Purchase of other real estate                                     (32,014)    
Proceeds of sale of other real estate               639,563            
Investment in securities                           (200,000)     (500,000)
Proceeds of sale of securities                    1,099,190       863,107 

NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES  1,538,753       331,093 

    Financing Activities
Payment of dividends and payments in lieu of 
  fractional shares                              (1,197,420)     (962,348)
Sale of Common Stock                                385,043       737,890 
Treasury Stock transactions - net                    (6,887)       (1,523)

NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES   (819,264)     (225,981)

 INCREASE (DECREASE) IN CASH                        722,322       470,141

Cash at beginning of year                           728,839       258,698

  CASH AT END OF YEAR                            $1,451,161    $  728,839

Note 15 - Long Term Debt

At December 31, 1996 and 1995, long-term debt consists of advances from
the Federal Home Loan Bank in the amounts of $2,996,480 and $4,651,903
respectively.  These advances are secured by all of the fully disbursed,
1-4 family residential mortgage loans held by First Citizens National
Bank and mature in the years 2004 through 2010. The averages for 1996
and 1995 are as follows:

                  Year   Average Volume   Average Rate  Average Maturity

FHLB Borrowings   1996    $4,084,025         5.64%           7 years

FHLB Borrowings   1995    $5,892,739         5.90%           7 years

Note 16 - Securities Sold Under Agreement to Repurchase

At December 31, 1996 and 1995, First Citizens National Bank had
outstanding balances in securities sold under agreement to repurchase as
follows:
                                           1996           1995

Outstanding balance                     $21,225,315     $19,744,966
Weighted average interest rate              4.31%           4.59%
Average balances outstanding 
  during the year                        20,883,000      17,033,000
Average weighted average interest rate      4.48%           4.66%

      <PAGE>61
                           FIRST CITIZENS BANCSHARES, INC.,
                                 AND SUBSIDIARY
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                           December 31, 1996 and 1995


Note 17 - Non-cash Investing and Financing Activities

During the periods presented, the Corporation engaged in the following
non-cash investing and financing activities:

Investing                       1996      1995       1994 

Other real estate acquired in  
 satisfaction of loans         $67,302  $368,000  $188,431

Note 18 - Financial Instruments with Off-Balance Sheet Risk

First Citizens National Bank is a party to financial instruments with
off-balance sheet risk in the normal course of business to meet the
financing needs of its customers.  These financial instruments include
commitments to extend credit and standby letters of credit.  These
instruments involve, to varying degrees, elements of credit risk which
are not recognized in the statement of financial position.

The Bank's exposure to credit loss in the event of non-performance by
the other party to the financial instrument for commitments to extend
credit and standby letters of credit is represented by the contractual
amount of those instruments.  The same policies are utilized in making
commitments and conditional obligations as are used for creating on-balance 
sheet instruments.  Ordinarily, collateral or other security is
not required to support financial instruments with off-balance sheet
risk.

Commitments to extend credit are agreements to lend to a customer as
long as there is no violation of any condition established in the
contract.  Loan commitments generally have fixed expiration dates or
other termination clauses and may require payment of a fee.  Since many
commitments are expected to expire without being drawn upon, the total
commitment amounts do not necessarily represent future cash
requirements.  Each customer's credit-worthiness is evaluated on a case-by-
case basis, and collateral required, if deemed necessary by the Bank
upon extension of credit, is based on management's credit evaluation of
the counter party.  At December 31, 1996 and 1995, First Citizens
National Bank had outstanding loan commitments of $32,540,000 and
$26,037,000 respectively.  Of these commitments, none had an original
maturity in excess of one year.

Standby letters of credit and financial guarantees are conditional
commitments issued by the Bank to guarantee the performance of a
customer to a third party.  Those guarantees are issued primarily to
support public and private borrowing arrangements, and the credit risk
involved is essentially the same as that involved in extending loans to
customers.  The bank requires collateral to secure these commitments
when it is deemed necessary.  At December 31, 1996 and 1995, outstanding
standby letters of credit totaled $1,483,000 and $1,676,000.

In the normal course of business, First Citizens National Bank extends
loans which are subsequently sold to other lenders, including agencies
of the U. S. Government.  Certain of these loans are conveyed with
recourse creating off-balance sheet risk with regard to the
collectability of the loan.  At December 31, 1996, however, the Bank had
no loans sold.




      <PAGE>62

                          FIRST CITIZENS BANCSHARES, INC.,
                                  AND SUBSIDIARY
                      NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                            December 31, 1996 and 1995

Note 19 - Significant Concentrations of Credit Risk

First Citizens National Bank grants agribusiness, commercial,
residential and personal loans to customers throughout a wide area of 
the mid-southern United States.  A large majority of the Bank's loans,
however, are concentrated in the immediate vicinity of the Bank or
northwest Tennessee.  Although, the Bank has a diversified loan
portfolio, a substantial portion of its debtors' ability to honor their
obligations is dependent upon the agribusiness and industrial economic 
sectors of that geographic area.


Note 20 - Disclosure of Fair Value of Financial Instruments

The following assumptions were made and methods applied to estimate the
fair value of each class of financial instruments reflected on the
balance sheet of the Corporation:

Cash and Cash Equivalents

For instruments which qualify as cash equivalents, as described in Note
1 of Notes to Financial Statements, the carrying amount is assumed to be
fair value.

Investment Securities

Fair value for investment securities is based on quoted market price, if
available.  If quoted market price is not available, fair value is
estimated using quoted market prices for similar securities.

Loans Receivable

Fair value of variable-rate loans with no significant change in credit
risk subsequent to loan origination is based on carrying amounts.  For
other loans, such as fixed rate loans, fair values are estimated
utilizing discounted cash flow analyses, applying interest rates
currently offered for new loans with similar terms to borrowers of
similar credit quality.  Fair values of loans which have experienced
significant changes in credit risk have been adjusted to reflect such
changes.

The fair value of accrued interest receivable is assumed to be its
carrying value.

Deposit Liabilities

Demand Deposits

The fair values of deposits which are payable on demand, such as
interest-bearing and non-interest-bearing checking accounts, passbook
savings and certain money market accounts are equal to the carrying
amount of the deposits.

Variable-Rate Deposits

The fair value of variable-rate money market accounts and certificates
of deposit approximate their carrying value at the balance sheet date.



      <PAGE>63
                          FIRST CITIZENS BANCSHARES, INC.,
                                  AND SUBSIDIARY
                      NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                            December 31, 1996 and 1995

Note 20 - Disclosure of Fair Value of Financial Instruments (continued)

Fixed-Rate Deposits

For fixed-rate certificates of deposit, fair values are estimated using
discounted cash flow analyses which apply interest rates currently being
offered on certificates to a schedule of aggregated monthly maturities
on time deposits.

Short-Term Borrowings

Carrying amounts of short-term borrowings, which include securities sold
under agreement to repurchase approximate their fair values at December
31, 1996 and 1995.

Long-Term Debt

The fair value of the Corporation's long-term debt is estimated using
the discounted cash flow approach, based on the institution's current
incremental borrowing rates for similar types of borrowing arrangements. 
At December 31, 1996, the long-term debt interest rate equals the fair
market rate and, as a result, the carrying value of long-term debt
approximates its fair value.

Other Liabilities

Other liabilities consist primarily of accounts payable, accrued
interest payable and accrued taxes.  These liabilities are short-term
and their carrying values approximate their fair values.

Unrecognized Financial Instruments are generally extended for short
periods of time, and as a result, the fair value is estimated to
approximate the face or carrying amount.

The estimated fair values of the Corporation's financial instruments are
as follows:
                                      1996                      1995      
                             Carrying        Fair     Carrying        Fair
                             Amount         Value     Amount          Value
Financial Assets
     
Cash and cash equivalents $ 13,507,293 $ 13,507,293 $ 13,544,413  $13,544,413

Investment securities       75,746,882   75,784,906   73,891,325   74,202,313

 Loans                     211,389,096               191,906,433           
Less:  Allowance for 
       loan losses          (2,282,231)               (2,216,511)            
Loans, net of allowance    209,106,865  206,282,461  189,689,922  188,182,000

 Accrued interest
   receivable                                          3,951,100    3,951,100

Financial Liabilities

  Deposits                 256,414,023  258,355,315  237,160,381  238,314,000
                                                     
  Short-term borrowings     21,225,315   21,240,136   19,744,966   19,744,966
                                                     
  Long-term debt             2,996,480    2,985,417    4,651,903    4,665,000
                                                     
  Other liabilities          2,831,975    2,831,975    2,751,409    2,751,409
                                                     




<PAGE>
      <PAGE>64

                          FIRST CITIZENS BANCSHARES, INC.,
                                  AND SUBSIDIARY
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                            December 31, 1996 and 1995


Unrecognized Financial
  Instruments                                        
                                                     
  Commitments to extend                            
   credit                    32,540,000   32,540,000  26,037,000  26,037,000
  Standby letter of                                
   credit                     1,483,000    1,483,000   1,676,000   1,676,000


Note 21 - Commitments and Contingencies

During the year ended December 31, 1995, the Board of Directors approved
a stock repurchase plan whereby the Company is authorized to acquire up
to a maximum of $200,000 of its outstanding capital stock per calendar
quarter.  The stock repurchase plan is designed to enable First Citizens
Bancshares, Inc. to meet the requirements of the Employee Stock
Ownership Plan and the Dividend Reinvestment Plan in place.

Note 22 - Judgement

At December 31, 1996, First Citizens Financial Plus, Inc. a subsidiary
of First Citizens National Bank, was a defendant in a legal action filed
by a former employee alleging unfair competitive practices used against
him after he left employment of the Company.  First Citizens Financial
Plus, Inc. had previously initiated litigation against the former
employee asserting that he had breached his fiduciary duties to the
Company.  In February, 1996, an arbitration panel of the National
Association of Securities Dealers held First Citizens Financial Plus,
Inc. liable for damages totaling approximately $134,000.  The same panel
found the former employee liable for $9,500 in compensatory damages. 
The Company recorded the judgement, along with related legal expenses,
as a liability at December 31, 1996.  The expense of the judgement is
reflected in "other expenses" on the Consolidated Statement of Income.


Note 23 - Branch Acquisition

During the year ended December 31, 1995, First Citizens National Bank
acquired a branch of another financial institution in Ripley, Tennessee. 
In the transaction, the Bank acquired fixed assets and loans with a
value of approximately $242,749 and assumed deposits totaling
approximately $8,400,000.  First Citizens National Bank paid a premium
of $124,382 for the deposits acquired which had been recorded as
goodwill and is being amortized over fifteen years.

<PAGE>
     <PAGE>65

                       FIRST CITIZENS BANCSHARES, INC.,
                                AND SUBSIDIARY
                   NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                               December 31, 1996


Note 24 - Amounts Receivable From Certain Persons

                                               Year Ended December 31, 1996
                                                        (In Thousands)


Column A                  Column B     Column C     Column D       Column E
                          Balance at                              Balance at
                          Beginning                                 End of
                          of Period    Additions   Deductions      Period  
                                                          Amounts            
                                                 Amounts  Written         Not
                                                Collected   Off  Current Current

Aggregate indebtedness 
  to First Citizens 
  National Bank of 
  Directors and Executive             
  Officers of First 
  Citizens Bancshares,
    Inc. (21)              $4,043     $3,004    $2,720      $-0- $4,328    $-0-

Aggregate indebtedness 
  to First Citizens 
  National Bank of 
  Directors and Executive       
  Officers of First 
  Citizens National
  Bank  (21)               $4,146    $3,054    $2,752      $-0- $4,448    $-0-

                                             Year Ended December 31, 1995  
                                                    (In Thousands)

Aggregate indebtedness 
  to First Citizens
  National Bank of
  Directors and Executive       
  Officers of First
  Citizens Bancshares,
  Inc. (21)                $2,443    $2,568    $  968      $-0- $4,043     $-0-

Aggregate indebtedness 
  to First Citizens
  National Bank of
  Directors and Executive       
  Officers of First
  Citizens National
  Bank  (21)               $2,535    $2,662    $1,051      $-0- $4,146     $-0-


Indebtedness shown represents amounts owed by directors and
executive officers of First Citizens Bancshares, Inc., and
First Citizens National Bank and by businesses in which such
persons are general partners or have at least 10% or greater
interest and trust and estates in which they have a
substantial beneficial interest.  All loans have been made on
substantially the same terms, including interest rates and
collateral as those prevailing at the time for comparable
transactions with others and do not involve other than normal
risks of collectibility.
<PAGE>
     <PAGE>66

ITEM 9.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Bancshares had no disagreements regarding accounting
procedures.

                        PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Information appearing in Bancshares' 1996 Proxy Statement
regarding directors and officers is incorporated herein by
reference in response to this Item. 

ITEM 11.  EXECUTIVE COMPENSATION

The information required under this Item is set forth in the
1996 Proxy Statement, and is incorporated by reference.  

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT 

Ownership of Bancshares' common stock by certain beneficial
owners and by management is set forth in Bancshares' 1996
Proxy Statement for the Annual Meeting of Shareholders to be
held April 17, 1996, in the sections entitled Voting
Securities and Election of Directors and is incorporated
herein by reference.  (See pages 3 through 5 of the Proxy
Statement).

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Officers, Directors and principal shareholders of the holding
company (and their associates) have deposit accounts and other
transactions with First Citizens National Bank. These
relationships are covered in detail on page 9 of the Proxy
Statement under "Certain Relationships and Related
Transactions" and incorporated herein by reference. 
Additional information concerning indebtedness to Bancshares
and First Citizens by Directors and/or their affiliates is
included herein under Part III, Page 53 "Amounts Receivable
from Certain Persons".
<PAGE>
      <PAGE>67

                                    SIGNATURES

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

                                            FIRST CITIZENS BANCSHARES, INC.


                                            By /s/Stallings Lipford
                                               Stallings Lipford
                                               Chairman 


                                            By /s/Jeff Agee
                                               Jeff Agee
                                               Vice President & Principal
                                               Financial Officer

     Dated:   03/17/97

Pursuant to the requirements of the Securities Exchange Act of 1934, 
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities indicated on March 17, 1997.

/s/ Eddie Anderson                          /s/Milton E. Magee              
Eddie Anderson                              Milton E. Magee                 
Director                                    Director
                                            
                                            /s/Mary Frances McCauley 
/s J. Walter Bradshaw                       Mary Frances McCauley
J. Walter Bradshaw                          Director
Director

/s/James Daniel Carpenter                   /s/L. D. Pennington
James Daniel Carpenter                      L. D. Pennington 
Director                                    Director


/s/William C. Cloar                         /s/G.W. Smitheal, III 
William C. Cloar                            G.W. Smitheal, III
Director                                    Director


/s/Richard Donner                           /s/P. H. White, Jr.
Richard W. Donner                           P. H. White, Jr.
Director                                    Director
 
/s/J.E. Heckethorn                          /s/Dwight Steven Williams 
John E. Heckethorn                          Dwight Steven Williams
Director                                    Director

/s/ E.H. Lannom, Jr.                        /s/Katie Winchester
E.H. Lannom, Jr.                            Katie Winchester
Director                                    Director

/s/ Barry T. Ladd                           /s/Billy S. Yates
Barry T. Ladd                               Billy S. Yates
Director                                    Director 

/s/Stallings Lipford                              
Stallings Lipford                                 
Director