**UNITED STATES SECURITIES ANDEXCHANGE COMMISSION**

**Washington, D.C. 20549**

** **

**Form 10-QSB**

 

| **ý** |   | **QUARTERLY REPORT UNDER SECTION 13  OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD  ENDED September 30, 2003**                                                                                                                                                       |
|------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|       |   |                                                                                                                                                                                                                                                                                            |
| **o**      |   | **TRANSITION  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT FOR THE  TRANSITION PERIOD FROM                  TO                ** |

 

**Commission File Number 0-28894**

 

**Access Anytime Bancorp, Inc.**

(Name of small businessissuer in its charter)

 

| **DELAWARE**                                                                     |                                                                            | **85-0444597**                        |
|----------------------------------------------------------------------------------|---------------------------------------------------------------------------------|---------------------------------------|
| (State or other  jurisdiction of  incorporation or organization)                 |                                                                            | (I.R.S. Employer  Identification No.) |
|                                                                             |                                                                            |                                  |
| **5210 Eubank, NE, Albuquerque, New  Mexico  87111**                   |
| (Address of  principal executive offices)  (Zip  Code)                      |
|                                                                             |
| Issuer’s  telephone number, including area code:   **(505)  299-0900** |
|                                                                             |
|                                                                             | SECURITIES  REGISTERED UNDER SECTION 12(b) OF THE EXCHANGE ACT:**   None** |
|                                                                             |                                                                            |
|                                                                             | SECURITIES  REGISTERED UNDER SECTION 12(g) OF THE EXCHANGE ACT:                 |
|                                                                             |
| **COMMON  STOCK $.01 PAR VALUE**                                                 |
| (Title of class)                                                                 |
|                                                                                  |                                                                                 |                                       |  |

 

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

 

Yes ý    No o

 

**1,351,625Shares of Capital Stock $.01 par value**Outstanding as of October 31, 2003

 

 

Transitional Small Business Disclosure Format (checkone):  Yes o    No ý

 

 

----

 

**TABLE OF CONTENTS**

 
| **PART I – FINANCIAL  INFORMATION**                                      |
|-------------------------------------------------------------------------------|
|                                                                          |
| Item 1 – Financial  Statements                                           |
|                                                                          |
|                                                                          |   | Consolidated  Statements of Financial Condition    (Unaudited as of September 30, 2003) |
|                                                                          |
|                                                                          |   | Unaudited  Consolidated Statements of Operations |
|                                                                          |
|                                                                          |   | Unaudited  Consolidated Statement of Stockholders’ Equity |
|                                                                          |
|                                                                          |   | Unaudited  Consolidated Statements of Cash Flows |
|                                                                          |
|                                                                          |   | Notes  to Consolidated Financial Statements (Unaudited) |
|                                                                          |
| Item  2 – Management’s Discussion and Analysis or Plan of Operation |
|                                                                          |
| Item 3 – Controls and  Procedures                                        |
|                                                                          |
| **PART II – OTHER  INFORMATION**                                         |
|                                                                          |
| Item  1 – Legal Proceedings                                              |
|                                                                          |
| Item 2 – Changes in  Securities                                          |
|                                                                          |
| Item 3 –  Defaults Upon Senior Securities                                |
|                                                                          |
| Item  4 – Submission of Matters to a Vote of Security Holders            |
|                                                                          |
| Item  5 – Other Information                                              |
|                                                                          |
| Item 6 –  Exhibits and Reports on Form 8-K                               |
|                                                                          |
| **SIGNATURES**                                                                |

 

2

----

 

**PART I – FINANCIAL INFORMATION**

 

# **Item 1 – FinancialStatements**

The followingunaudited consolidated financial statements include all adjustments, which inthe opinion of management, are necessary in order to make such financialstatements not misleading.

 

# **ACCESSANYTIME BANCORP, INC. AND SUBSIDIARY**

# **ConsolidatedStatements of Financial Condition**

 
|                                                                                                                                                                          |   | **Unaudited****September 30,  2003** |        | **December 31,  2002** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------|-------------|------------------------|--------|
| ASSETS                                                                                                                                                                        |   |                                 |        |                   |   |
|                                                                                                                                                                          |   |                                 |        |                   |   |
| Cash and cash equivalents                                                                                                                                                     |   | $                                    | 26,543,539  |                   | $      | 12,342,444 |   |
| Certificates of deposit                                                                                                                                                       |   | 4,884,000                            |        | 5,993,000              |   |
| Securities available-for-sale (amortized cost of  $4,350,257 and $6,515,011)                                                                                                  |   | 4,472,199                            |        | 6,665,338              |   |
| Securities held-to-maturity (aggregate fair value of  $1,529,931 and  $1,879,898)                                                                                        |   | 1,495,903                            |        | 1,862,474              |   |
| Loans held-for-sale (aggregate fair value of  $3,557,528 and $6,688,146)                                                                                                      |   | 3,486,294                            |        | 6,553,116              |   |
| Loans receivable, net                                                                                                                                                         |   | 153,183,389                          |        | 149,856,081            |   |
| Interest receivable, loans                                                                                                                                                    |   | 686,960                              |        | 771,189                |   |
| Interest receivable, securities                                                                                                                                               |   | 68,258                               |        | 102,198                |   |
| Real estate owned                                                                                                                                                             |   | 312,338                              |        | 647,917                |   |
| Federal Home Loan Bank stock                                                                                                                                                  |   | 1,161,400                            |        | 1,013,200              |   |
| Premises and equipment, net                                                                                                                                                   |   | 3,589,359                            |        | 3,654,169              |   |
| Unidentifiable intangible asset, net of accumulated  amortization of $569,689 and $460,444                                                                                    |   | 1,614,399                            |        | 1,723,644              |   |
| Deferred tax asset                                                                                                                                                            |   | 238,934                              |        | 361,368                |   |
| Other assets                                                                                                                                                                  |   | 600,857                              |        | 553,997                |   |
|                                                                                                                                                                          |   |                                 |        |                   |   |
| Total assets                                                                                                                                                                  |   | $                                    | 202,337,829 |                   | $      | 192,100,135 |   |
|                                                                                                                                                                          |   |                                 |        |                   |   |
| LIABILITIES AND  STOCKHOLDERS’ EQUITY                                                                                                                                    |   |                                 |        |                   |   |
|                                                                                                                                                                          |   |                                 |        |                   |   |
| Liabilities:                                                                                                                                                                  |   |                                 |        |                   |   |
| Deposits                                                                                                                                                                      |   | $                                    | 159,025,073 |                   | $      | 159,197,158 |   |
| Federal Home Loan Bank advances                                                                                                                                               |   | 18,090,615                           |        | 8,267,321              |   |
| Accrued interest and other liabilities                                                                                                                                        |   | 1,544,589                            |        | 1,384,196              |   |
| Advanced payments by borrowers for taxes and  insurance                                                                                                                       |   | 515,392                              |        | 434,247                |   |
| Trust Preferred Securities – Notes Payable                                                                                                                               |   | 8,000,000                            |        | 8,000,000              |   |
|                                                                                                                                                                          |   |                                 |        |                   |   |
| Total liabilities                                                                                                                                                             |   | 187,175,669                          |        | 177,282,922            |   |
|                                                                                                                                                                          |   |                                 |        |                   |   |
| Commitments and contingencies                                                                                                                                                 |   |                                 |        |                   |   |
|                                                                                                                                                                          |   |                                 |        |                   |   |
| Stockholders’ equity:                                                                                                                                                    |   |                                 |        |                   |   |
| Preferred stock, $.01 par value; 4,000,000 shares  authorized; none issued                                                                                                    |   | —                               |        | —                 |   |
| Common stock, $.01 par value; 6,000,000 shares  authorized; 1,510,211 and 1,508,012 shares issued; 1,217,842 and 1,302,161  shares outstanding in 2003 and 2002, respectively |   | 15,102                               |        | 15,080                 |   |
| Capital in excess of par value                                                                                                                                                |   | 11,566,739                           |        | 11,378,222             |   |
| Retained earnings                                                                                                                                                             |   | 5,660,469                            |        | 4,547,359              |   |
| Accumulated other comprehensive income, net of tax  expense of $48,777 and $60,131                                                                                            |   | 73,165                               |        | 90,197                 |   |
|                                                                                                                                                                          |   | 17,315,475                           |        | 16,030,858             |   |
| Unallocated Employee Stock Ownership Plan shares;  136,000 and 160,000                                                                                                        |   | (735,000                             | )           | (870,000               | )      |
| Treasury stock, at cost; 156,369 and 45,851 shares                                                                                                                            |   | (1,418,315                           | )           | (343,645               | )      |
| Total stockholders’ equity                                                                                                                                               |   | 15,162,160                           |        | 14,817,213             |   |
|                                                                                                                                                                          |   |                                 |        |                   |   |
| Total liabilities and stockholders’ equity                                                                                                                               |   | $                                    | 202,337,829 |                   | $      | 192,100,135 |   |

 

The accompanyingnotes are an integral part of these unaudited consolidated financialstatements.

 

3

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# **ACCESSANYTIME BANCORP, INC. AND SUBSIDIARY**

# **UnauditedConsolidated Statements of Operations**

 
|                                                          |   | **Three Month  Periods Ended  September 30,** |            | **Nine Month  Periods Ended  September 30,** |   |
|---------------------------------------------------------------|--------|-----------------------------------------------|-----------------|----------------------------------------------|--------|
|                                                          |   | **2003**                                      |            | **2002**                                     |   | **2003** |   | **2002** |   |
| Interest income:                                              |   |                                          |            |                                         |   |   |   |   |   |
| Loans receivable                                              |   | $                                             |  2,700,382 |                                         | $      |  2,785,695 |   | $ |  8,075,827 |   | $ |  8,213,133 |   |
| Equity securities                                             |   | 34,993                                        |            | 46,397                                       |   | 111,027 |   | 136,966 |   |
| Mortgage-backed securities                                    |   | 48,891                                        |            | 112,510                                      |   | 187,829 |   | 396,690 |   |
| Other interest income                                         |   | 78,013                                        |            | 74,664                                       |   | 228,491 |   | 179,602 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Total interest income                                         |   | 2,862,279                                     |            | 3,019,266                                    |   | 8,603,174 |   | 8,926,391 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Interest expense:                                             |   |                                          |            |                                         |   |   |   |   |   |
| Deposits                                                      |   | 804,415                                       |            | 1,063,347                                    |   | 2,511,051 |   | 3,252,014 |   |
| Federal Home Loan Bank advances                               |   | 116,820                                       |            | 81,872                                       |   | 316,056 |   | 260,086 |   |
| Other borrowings                                              |   | 163,783                                       |            | 185,932                                      |   | 489,167 |   | 428,981 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Total interest expense                                        |   | 1,085,018                                     |            | 1,331,151                                    |   | 3,316,274 |   | 3,941,081 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Net interest income before provision for loan losses          |   | 1,777,261                                     |            | 1,688,115                                    |   | 5,286,900 |   | 4,985,310 |   |
| Provision for loan losses                                     |   | 213,000                                       |            | 238,000                                      |   | 568,000 |   | 618,000 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Net interest income after provision for loan losses           |   | 1,564,261                                     |            | 1,450,115                                    |   | 4,718,900 |   | 4,367,310 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Noninterest income:                                           |   |                                          |            |                                         |   |   |   |   |   |
| Loan servicing and other fees                                 |   | 248,696                                       |            | 120,561                                      |   | 610,737 |   | 372,081 |   |
| Net realized gains on sales of available-for-sale  securities |   | —                                        |            | 58,115                                       |   | 8,995 |   | 58,115 |   |
| Gains on sales of mortgage loans held-for-sale                |   | 641,192                                       |            | 207,785                                      |   | 1,650,057 |   | 304,586 |   |
| Other income                                                  |   | 280,573                                       |            | 232,490                                      |   | 793,523 |   | 715,970 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Total noninterest income                                      |   | 1,170,461                                     |            | 618,951                                      |   | 3,063,312 |   | 1,450,752 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Noninterest expense:                                          |   |                                          |            |                                         |   |   |   |   |   |
| Salaries and employee benefits                                |   | 1,349,259                                     |            | 806,796                                      |   | 3,447,950 |   | 2,437,537 |   |
| Occupancy expense                                             |   | 217,234                                       |            | 227,670                                      |   | 658,331 |   | 620,709 |   |
| Deposit insurance premium                                     |   | 22,347                                        |            | 19,005                                       |   | 62,008 |   | 77,861 |   |
| Advertising                                                   |   | 32,133                                        |            | 16,522                                       |   | 80,543 |   | 58,670 |   |
| Professional fees                                             |   | 319,897                                       |            | 84,617                                       |   | 547,584 |   | 261,982 |   |
| Other expense                                                 |   | 485,605                                       |            | 539,709                                      |   | 1,466,059 |   | 1,313,408 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Total noninterest expense                                     |   | 2,426,475                                     |            | 1,694,319                                    |   | 6,262,475 |   | 4,770,167 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Income before income taxes                                    |   | 308,247                                       |            | 374,747                                      |   | 1,519,737 |   | 1,047,895 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Income tax (benefit) expense                                  |   | (76,702                                       | )               | 147,985                                      |   | 406,627 |   | 419,158 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Net income                                                    |   | $                                             |  384,949   |                                         | $      |  226,762 |   | $ |  1,113,110 |   | $ |  628,737 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Earnings per common share-basic                               |   | $                                             |  .31       |                                         | $      |  .17 |   | $ |  .89 |   | $ |  .48 |   |
|                                                          |   |                                          |            |                                         |   |   |   |   |   |
| Earnings per common share-assuming dilution                   |   | $                                             |  .28       |                                         | $      |  .16 |   | $ |  .82 |   | $ |  .46 |   |

 

The accompanyingnotes are an integral part of these unaudited consolidated financialstatements.

 

4

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# **ACCESSANYTIME BANCORP, INC. AND SUBSIDIARY**

### **UnauditedConsolidated Statement of Stockholders’ Equity**

|                                                                                       |   |                        |                  |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |
|--------------------------------------------------------------------------------------------|--------|-----------------------------|-----------------------|-------------------|------------|---------------------------------------|--------|------------------------|--------|----------------------------------------------------|-----------|------------------------------|-----------|--------------------|--------|-----------|--------|
|                                                                                       |   | **Comprehensive    Income** |                  | **Common  Stock** |       | **Capital  in Excess  of Par  Value** |   | **Retained  Earnings** |   | **Accumulated  Other  Comprehensive  Income  Net** |      | **Unallocated  ESOP Shares** |      | **Treasury Stock** |   | **Total** |   |
| **Number of   shares**                                                                     |   | **Amount**                  | **Number  Of Shares** |              | **Amount** |
|                                                                                       |   |                        |                  |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |   |   |   |   |
| Balance  at December 31, 2002                                                              |   |                        |                  | 1,508,012         |       | $                                     | 15,080 |                   | $      | 11,378,222                                         |      | $                            | 4,547,359 |               | $      | 90,197    |   | $ | (870,000 | ) | 45,851 |   | $ | (343,645 | ) | $ | 14,817,213 |   |
|                                                                                       |   |                        |                  |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |   |   |   |   |
| Net income                                                                                 |   | $                           | 1,113,110             |              | —     |                                  | — |                   | — |                                               | 1,113,110 |                         | —    |               | — |      | — |   | — |   | 1,113,110 |   |
|                                                                                       |   |                        |                  |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |   |   |   |   |
| Net  change in unrealized depreciation  on  available-for-sale securities, net of tax |   | (17,032                     | )                     | —            |       | —                                |   | —                 |   | —                                             |      | (17,032                      | )         | —             |   | —    |   | — |   | (17,032 | ) |
|                                                                                       |   |                        |                  |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |   |   |   |   |
| Total  comprehensive income                                                                |   | $                           | 1,096,078             |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |   |   |   |   |   |
|                                                                                       |   |                        |                  |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |   |   |   |   |
| Common  shares issued                                                                      |   |                        |                  | 2,199             |       | 22                                    |   | 13,997                 |   |                                               |      |                         |      |               |   |      |   |   |   | 14,019 |   |
|                                                                                       |   |                        |                  |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |   |   |   |   |
| Common  stock rights awarded in lieu of directors’ cash compensation                  |   |                        |                  | —            |       | —                                |   | 44,000                 |   | —                                             |      | —                       |      | —             |   | —    |   | — |   | 44,000 |   |
|                                                                                       |   |                        |                  |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |   |   |   |   |
| Purchases  of  treasury stock                                                         |   |                        |                  | —            |       | —                                |   | —                 |   | —                                             |      | —                       |      | —             |   | 110,518   |   | (1,074,670 | ) | (1,074,670 | ) |
|                                                                                       |   |                        |                  |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |   |   |   |   |
| ESOP  shares allocated                                                                     |   |                        |                  | —            |       | —                                |   | 130,520                |   | —                                             |      | —                       |      | 135,000            |   | —    |   | — |   | 265,520 |   |
|                                                                                       |   |                        |                  |              |       |                                  |   |                   |   |                                               |      |                         |      |               |   |      |   |   |   |   |   |
| Balance  at September 30, 2003                                                             |   |                        |                  | 1,510,211         |       | $                                     | 15,102 |                   | $      | 11,566,739                                         |      | $                            | 5,660,469 |               | $      | 73,165    |   | $ | (735,000 | ) | 156,369 |   | $ | (1,418,315 | ) | $ | 15,162,160 |   |

 
|                                                                                           |   | **Nine Months  Ended  September 30, 2003** |    | **Year Ended  December 31, 2002** |   |
|------------------------------------------------------------------------------------------------|--------|--------------------------------------------|---------|-----------------------------------|--------|
|                                                                                           |   |                                       |    |                              |   |
| Disclosure of  reclassification amounts:                                                       |   |                                       |    |                              |   |
| Unrealized holding (losses)  gains arising during period                                       |   | $                                          | (8,037  | )                                 | $      | 76,435 |   |
| Reclassification adjustment  for gains included in net income                                  |   | (8,995                                     | )       | (58,115                           | )      |
| Net unrealized  (depreciation) appreciation on available-for-sale securities,  net of tax |   | $                                          | (17,032 | )                                 | $      | 18,320 |   |

 

The accompanyingnotes are an integral part of these unaudited consolidated financialstatements.

 

5

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**ACCESS ANYTIME BANCORP, INC. ANDSUBSIDIARY**

# **UnauditedConsolidated Statements of Cash Flows**

 
|                                                                                |   | **Nine Month  Periods Ended  September 30,** |      |
|-------------------------------------------------------------------------------------|--------|----------------------------------------------|-----------|
|                                                                                |   | **2003**                                     |      | **2002** |   |
| Cash flows from operating activities:                                               |   |                                         |      |   |   |
| Net income                                                                          |   | $                                            | 1,113,110 |   | $ | 628,737 |   |
| Adjustments to reconcile net income to cash from  operating activities:             |   |                                         |      |   |   |
| Depreciation and amortization                                                       |   | 313,278                                      |      | 317,125 |   |
| Deferred income taxes                                                               |   | 122,434                                      |      | 238,282 |   |
| Provision for loan losses                                                           |   | 568,000                                      |      | 618,000 |   |
| Amortization of premiums on investment securities                                   |   | 32,980                                       |      | 23,455 |   |
| Amortization of loan premiums, discounts and  deferred fees, net                    |   | 406,882                                      |      | 169,739 |   |
| Non-cash ESOP contribution                                                          |   | 265,520                                      |      | 199,199 |   |
| Net realized gains on sales of available-for-sale  securities                       |   | (8,995                                       | )    | (58,115 | ) |
| Gains on sales of mortgage loans held-for-sale                                      |   | (1,650,057                                   | )         | (304,586 | ) |
| Proceeds from sales of mortgage loans held-for-sale                                 |   | 90,828,808                                   |      | 15,712,639 |   |
| Originations of mortgage loans held-for-sale                                        |   | (86,111,929                                  | )         | (21,674,458 | ) |
| Common stock rights awarded in lieu of directors  compensation                      |   | 44,000                                       |      | 40,000 |   |
| Loss (gain) on sale of foreclosed real estate                                       |   | 28,694                                       |      | (52,159 | ) |
| Gain on disposition of assets                                                       |   | (1,877                                       | )         | (100 | ) |
| Net increase in accrued interest receivable and  other assets                       |   | (105,222                                     | )    | (458,614 | ) |
| Increase in accrued interest and other liabilities                                  |   | 160,393                                      |      | 30,997 |   |
|                                                                                |   |                                         |      |   |   |
| Net cash from operating activities                                                  |   | 6,006,019                                    |      | (4,569,859 | ) |
|                                                                                |   |                                         |      |   |   |
| Cash flows from investing activities:                                               |   |                                         |      |   |   |
| Purchases of available-for-sale securities                                          |   | —                                       |      | (800,000 | ) |
| Proceeds from maturities and principal repayments of  available-for-sale securities |   | 2,075,288                                    |      | 2,738,415 |   |
| Proceeds from sales of available-for-sale securities                                |   | 108,995                                      |      | 1,035,982 |   |
| Proceeds from maturities and principal repayments of  held-to-maturity securities   |   | 351,442                                      |      | 126,886 |   |
| Net decrease (increase) in certificates of deposit                                  |   | 1,109,000                                    |      | (5,595,000 | ) |
| Net increase in loans                                                               |   | (4,302,190                                   | )         | (8,017,511 | ) |
| Proceeds from sales of foreclosed real estate                                       |   | 429,306                                      |      | 561,347 |   |
| Purchases of premises and equipment                                                 |   | (248,468                                     | )         | (312,496 | ) |
|                                                                                |   |                                         |      |   |   |
| Net cash from investing activities                                                  |   | (476,627                                     | )         | (10,262,377 | ) |
|                                                                                |   |                                         |      |   |   |
| Cash flows from financing activities:                                               |   |                                         |      |   |   |
| Net (decrease) increase in deposits                                                 |   | (172,085                                     | )         | 12,375,156 |   |
| Net increase in Federal Home Loan Bank advances                                     |   | 9,823,294                                    |      | 1,750,000 |   |
| Net increase in advance payments by borrowers for  taxes and insurance              |   | 81,145                                       |      | 214,528 |   |
| Repayment of employee stock ownership plan-note  payable                            |   | —                                       |      | (134,669 | ) |
| Issuance of trust preferred security-note payable                                   |   | —                                       |      | 4,000,000 |   |
| Purchase of treasury stock                                                          |   | (1,074,670                                   | )         | (34,600 | ) |
| Proceeds from issuance of common stock                                              |   | 14,019                                       |      | 77,854 |   |
|                                                                                |   |                                         |      |   |   |
| Net cash from financing activities                                                  |   | 8,671,703                                    |      | 18,248,269 |   |
|                                                                                |   |                                         |      |   |   |
| Increase in cash and cash equivalents                                               |   | 14,201,095                                   |      | 3,416,033 |   |
| Cash and cash equivalents at beginning of period                                    |   | 12,342,444                                   |      | 10,611,093 |   |
|                                                                                |   |                                         |      |   |   |
| Cash and cash equivalents at end of nine-months  period ended September 30          |   | 26,543,539                                   |      | 14,027,126 |   |
|                                                                                |   |                                         |      |   |   |
| Supplemental disclosures of cash flow information:                                  |   |                                         |      |   |   |
| Cash paid during the period for:                                                    |   |                                         |      |   |   |
| Interest                                                                            |   | $                                            | 3,422,864 |   | $ | 4,124,609 |   |
| Income taxes                                                                        |   | 325,150                                      |      | 26,750 |   |
| Supplemental disclosure of non-cash investing and  financing activities:            |   |                                         |      |   |   |
| Real estate acquired in settlement of loans                                         |   | 326,590                                      |      | 701,443 |   |

 

The accompanyingnotes are an integral part of these unaudited consolidated financialstatements.

 

6

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**ACCESSANYTIME BANCORP, INC. AND SUBSIDIARY**

**NOTESTO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)**

 

**NOTE 1                 Basis of Consolidation andPresentation**

 

Access AnytimeBancorp, Inc. (the “Company”) is a thrift holding company for its wholly ownedsubsidiary FirstBank (the “Bank”) and the Bank’s wholly owned subsidiary, FirstEquity Development Corporation (“FEDCO”). The consolidated financial statements include the accounts and transactionsof the Company, Bank and FEDCO.  Allsignificant intercompany accounts and transactions have been eliminated inconsolidation.

 

The unauditedinterim financial statements have been prepared by management of the Company,without audit.  Certain information andfootnote disclosures normally included in consolidated financial statementsprepared in accordance with accounting principles generally accepted in theUnited States of America have been omitted pursuant to such rules andregulations, although management believes that the disclosures included hereinare adequate to make the information presented not misleading.  In the opinion of management, alladjustments (consisting of only normal recurring accruals) considered necessaryfor a fair presentation of the information have been included.  The December 31, 2002 consolidated statementof financial condition, as presented herein, was derived from audited financialstatements, but does not include all disclosures required by accountingprinciples generally accepted in the United States of America and should beread in conjunction with the audited consolidated financial statements of theCompany for the year ended December 31, 2002 included in the Company’s AnnualReport on 10-KSB.

 

**NOTE 2                 Summary of SignificantAccounting Policies**

 

***Impact of New Accounting Standards*** – In November 2002, the FASB issuedInterpretation No. 45 (“Interpretation 45”), *Guarantor’s Accounting and DisclosureRequirements for Guarantees, Including Indirect Guarantees of Indebtedness toOthers, an interpretation of FASB Statements No. 5, 57, and 107 and rescissionof FASB Interpretation No. 34.* This interpretation elaborates on the disclosures to be made by aguarantor in its interim and annual consolidated financial statements about itsobligations under guarantees issued. Interpretation 45 also clarifies that a guarantor is required torecognize, at inception of a guarantee, a liability for the fair value of theobligation undertaken.  The Companyadopted the provisions of Interpretation 45 as of January 1, 2003, and thisadoption had no impact on the Company’s consolidated financial statements.

 

In December 2002, the FASB issued Statement No. 148 (“Statement 148”), *Accountingfor Stock-Based Compensation-Transition and Disclosure-an amendment of FASBStatement No. 123.*  Thisstatement amends Statement 123 to provide alternative methods of transition toa voluntary change to the fair value based method of accounting for stock-basedemployee compensation.  In addition,Statement 148 amends the disclosure requirements to require prominentdisclosures in both annual and interim financial statements about the method ofaccounting for stock-based employee compensation and the effect of the methodused on reported results.  Statement 148is effective for fiscal years ending after December 15, 2002, and for interimperiods beginning after December 15, 2002. The Company has elected to continue to use the intrinsic value method ofaccounting under Opinion 25.

 

7

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Statement 148allows for the fair value based method under Statement 123, *Accountingfor Stock-Based Compensation*, or the intrinsic value based methodunder APB Opinion No. 25 (“Opinion 25”), *Accounting for Stock Issued to Employees*.  Under the fair value based method ofaccounting, compensation cost is measured at the grant date based on the valueof the award and is recognized over the service period, which is generally thevesting period.  Under the intrinsicvalue method of accounting, compensation cost is the excess, if any, of thequoted market price of the stock at grant date or other measurement date overthe amount an employee must pay to acquire the stock.

 

Had compensationcost for all grants of stock options and the director retainer plan sharesduring 2003 and 2002 been determined based on the fair value at the date ofgrant, reported net income and earnings per share would have been adjusted tothe pro-forma amounts shown below:

** **
|                                                                                                                                                 |   | **Three  Month Periods Ended  September 30,** |    | **Nine Month  Periods Ended  September 30,** |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------|---------|----------------------------------------------|--------|
|                                                                                                                                                 |   | **2003**                                      |    | **2002**                                     |   | **2003** |   | **2002** |   |
|                                                                                                                                                 |   |                                          |    |                                         |   |   |   |   |   |
| Net income, as reported                                                                                                                              |   | $                                             | 384,949 |                                         | $      | 226,762 |   | $ | 1,113,110 |   | $ | 628,737 |   |
| Add: Stock-based employee compensation expense  included in reported net income, net of related  tax effects                                         |   | 44,200                                        |    | —                                       |   | 48,017 |   | — |   |
| Deduct:   Total stock-based employee compensation  expense determined under fair value based method  for all awards, net of related tax effects |   | —                                        |    | (4,060                                       | )      | (141,852 | ) | (27,641 | ) |
|                                                                                                                                                 |   |                                          |    |                                         |   |   |   |   |   |
| Pro forma net income                                                                                                                                 |   | $                                             | 429,149 |                                         | $      | 222,702 |   | $ | 1,019,275 |   | $ | 601,096 |   |
|                                                                                                                                                 |   |                                          |    |                                         |   |   |   |   |   |
| Earnings per share-basic                                                                                                                             |   |                                          |    |                                         |   |   |   |   |   |
| As reported                                                                                                                                          |   | $                                             | .31     |                                         | $      | .17 |   | $ | .89 |   | $ | .48 |   |
| Pro-forma                                                                                                                                            |   | $                                             | .35     |                                         | $      | .17 |   | $ | .81 |   | $ | .46 |   |
|                                                                                                                                                 |   |                                          |    |                                         |   |   |   |   |   |
| Earnings per share-assuming dilution                                                                                                                 |   |                                          |    |                                         |   |   |   |   |   |
| As reported                                                                                                                                          |   | $                                             | .28     |                                         | $      | .16 |   | $ | .82 |   | $ | .46 |   |
| Pro-forma                                                                                                                                            |   | $                                             | .32     |                                         | $      | .16 |   | $ | .75 |   | $ | .44 |   |

 

In May 2003, the FASB issued Statement No. 150 (“Statement 150”), *Accountingfor Certain Financial Instruments with Characteristics of both Liabilities andEquity.*  This statementimproves the accounting for certain financial instruments that, under previousguidance, issuers could account for as equity. In addition, Statement 150 requires that those instruments be classifiedas liabilities on the Company’s consolidated statements of financialcondition.  The initial recognition andmeasurement provisions of Statement 150 are applicable to financial instrumentsentered into or modified after May 31, 2003. Statement 150 is effective for fiscal years beginning after December 15,2003, and for interim periods beginning after June 15, 2003.  The adoption of Statement 150 did not havean impact on the Company’s consolidated financial statements.

 

8

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In January 2003, the FASB issued FASB Interpretation No. 46(“Interpretation 46”), *Consolidation ofVariable Interest Entities, an interpretation of ARB No. 51*.  Interpretation 46 is intended to achievemore consistent application of consolidation policies to variable interestentities and, thus, to improve comparability between enterprises engaged insimilar activities even if some of those activities are conducted throughvariable interest entities.  Includingthe assets, liabilities, and results of activities of variable interest entitiesin the consolidated financial statements of their primary beneficiaries willprovide more complete information about the resources, obligations, risks andopportunities of the consolidated enterprise. Interpretation 46 applies immediately to variable interest entitiescreated after January 31, 2003, and to variable interest entities in which anenterprise obtains an interest after that date.  It applies in the first fiscal year or interim period beginningafter June 15, 2003, to variable interest entities in which an enterprise holdsa variable interest that it acquired before February 1, 2003.  Interpretation 46 applies to publicenterprises as of the beginning of the applicable interim or annual period, andit applies to nonpublic enterprises as of the end of the applicable annualperiod.  Interpretation 46 may beapplied prospectively with a cumulative-effect adjustment as of the date onwhich it is first applied or by restating previously issued financial statementsfor one or more years with a cumulative-effect adjustment as of the beginningof the first year restated.

 

The Company has two trusts, which were formed before February 1, 2003,for the purpose of issuing trust preferred securities, as further described inNote 16 of the Company’s 2002 Annual Report on Form 10-KSB.  The Company currently believes the continuedconsolidation of these trusts is appropriate under Interpretation 46.  However, the application of Interpretation46 to these types of trusts is an emerging issue and a possible unintendedconsequence of Interpretation 46 is the deconsolidation of these types oftrusts.  The Company is currentlyevaluating the impact that deconsolidation of these trusts would have on itsconsolidated financial statements

 

9

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**NOTE3                 SECURITIES**

 

Securities havebeen classified in the consolidated statements of financial condition accordingto management’s intent.  The carryingamount of securities and their approximate fair value follow:

 
|                                |   | **Amortized  Cost** |      | **Gross  unrealized** |   | **Fair  Value** |   |
|-------------------------------------|--------|---------------------|-----------|-----------------------|--------|-----------------|--------|
| **Gains**                           |   | **Losses**          |
|                                |   |                |      |                  |   |            |   |   |   |
| **Available-for-sale  securities:** |   |                |      |                  |   |            |   |   |   |
|                                |   |                |      |                  |   |            |   |   |   |
| September 30, 2003:                 |   |                |      |                  |   |            |   |   |   |
| Mortgage-backed securities:         |   |                |      |                  |   |            |   |   |   |
| GNMA adjustable rate                |   | $                   | 2,835,127 |                  | $      | 34,213          |   | $ | 1,777 |   | $ | 2,867,563 |   |
| GNMA fixed rate                     |   | 853,352             |      | 42,707                |   | —          |   | 896,059 |   |
| Equity securities:                  |   |                |      |                  |   |            |   |   |   |
| FNMA common stock                   |   | 6,858               |      | 162                   |   | —          |   | 7,020 |   |
| Corporate bonds                     |   | 99,920              |      | 1,657                 |   | —          |   | 101,577 |   |
| Trust preferred securities          |   | 555,000             |      | 44,980                |   | —          |   | 599,980 |   |
|                                |   | $                   | 4,350,257 |                  | $      | 123,719         |   | $ | 1,777 |   | $ | 4,472,199 |   |
|                                |   |                |      |                  |   |            |   |   |   |
| December 31, 2002:                  |   |                |      |                  |   |            |   |   |   |
| Mortgage-backed securities:         |   |                |      |                  |   |            |   |   |   |
| GNMA adjustable rate                |   | $                   | 3,869,130 |                  | $      | 35,498          |   | $ | 3,216 |   | $ | 3,901,412 |   |
| GNMA fixed rate                     |   | 1,884,218           |      | 95,672                |   | —          |   | 1,979,890 |   |
| Equity securities:                  |   |                |      |                  |   |            |   |   |   |
| FNMA common stock                   |   | 6,858               |      | —                |   | 425             |   | 6,433 |   |
| Corporate bonds                     |   | 99,805              |      | 971                   |   | —          |   | 100,776 |   |
| Trust preferred securities          |   | 655,000             |      | 22,150                |   | 323             |   | 678,827 |   |
|                                |   | $                   | 6,515,011 |                  | $      | 154,291         |   | $ | 3,964 |   | $ | 6,665,338 |   |

 
|                              |   | **Amortized  Cost** |       | **Gross  unrealized** |       | **Fair  Value** |       |
|-----------------------------------|--------|---------------------|------------|-----------------------|------------|-----------------|------------|
| **Gains**                         |   | **Losses**          |
|                              |   |                |       |                  |       |            |       |   |   |
| **Held-to-maturity  securities:** |   |                |       |                  |       |            |       |   |   |
|                              |   |                |       |                  |       |            |       |   |   |
| September 30, 2003:               |   |                |       |                  |       |            |       |   |   |
| Mortgage-backed securities:       |   |                |       |                  |       |            |       |   |   |
| FHLMC adjustable rate             |   | $                   | 309,248    |                  | $          | 2,800           |       | $ | 304 |   | $ | 311,744 |   |
| Corporate bonds                   |   | 886,655             |       | 9,532                 |       | —          |       | 896,187 |   |
| Trust preferred securities        |   | 300,000             |       | 22,000                |       | —          |       | 322,000 |   |
|                              |   | $                   | 1,495,903  |                  | $          | 34,332          |       | $ | 304 |   | $ | 1,529,931 |   |
|                              |   |                | ** ** |                  | ** ** |            | ** ** |   | ** ** |
| December 31, 2002:                |   |                |       |                  |       |            |       |   |   |
| Mortgage-backed securities:       |   |                |       |                  |       |            |       |   |   |
| FHLMC adjustable rate             |   | $                   | 463,270    |                  | $          | 7,828           |       | $ | — |   | $ | 471,098 |   |
| Corporate bonds                   |   | 1,099,204           |       | 2,105                 |       | 2,737           |       | 1,098,572 |   |
| Trust preferred securities        |   | 300,000             |       | 10,228                |       | —          |       | 310,228 |   |
|                              |   | $                   | 1,862,474  |                  | $          | 20,161          |       | $ | 2,737 |   | $ | 1,879,898 |   |

 

10

----

 

**NOTE4                 LOANS HELD-FOR-SALE**

 

The carryingamount of loans held-for-sale and their estimated fair value, as determined onan aggregate basis, follow:

 
|               |   |                |      | **Gross  unrealized** |   |       |   |
|--------------------|--------|---------------------|-----------|-----------------------|--------|------------|--------|
|               |   | **Amortized  cost** |      | **Gains**             |   | **Losses** |   | **Fair value** |   |
|               |   |                |      |                  |   |       |   |   |   |
| September 30, 2003 |   | $                   | 3,486,294 |                  | $      | 71,509     |   | $ | 275 |   | $ | 3,557,528 |   |
| December 31, 2002  |   | 6,553,116           |      | 135,030               |   | —     |   | 6,688,146 |   |
|                    |        |                     |           |                       |        |            |        |  |  |  |  |  |  |

 

**NOTE5                 LOANS RECEIVABLE**

 

The components ofloans in the consolidated statements of financial condition were as follows:

 
|                                              |   | **September  30,  2003** |        | **December  31,  2002** |   |
|---------------------------------------------------|--------|--------------------------|-------------|-------------------------|--------|
|                                              |   |                     |        |                    |   |
| First mortgage loans:                             |   |                     |        |                    |   |
| Conventional                                      |   | $                        | 74,584,093  |                    | $      | 72,697,413 |   |
| FHA insured and VA guaranteed                     |   | 10,471,954               |        | 12,305,845              |   |
| Commercial real estate loans                      |   | 33,473,752               |        | 27,998,956              |   |
| Commercial loans, other than mortgage             |   | 7,337,910                |        | 9,559,696               |   |
| Consumer and installment loans                    |   | 22,527,087               |        | 23,096,720              |   |
| Construction loans                                |   | 2,269,866                |        | 1,590,619               |   |
| Other                                             |   | 5,670,679                |        | 5,225,768               |   |
|                                              |   |                     |        |                    |   |
|                                              |   | 156,335,341              |        | 152,475,017             |   |
|                                              |   |                     |        |                    |   |
| Less:                                             |   |                     |        |                    |   |
| Loans in process                                  |   | 1,262,318                |        | 702,086                 |   |
| Unearned discounts, deferred loan fees, and other |   | 831,642                  |        | 1,091,865               |   |
| Allowance for loan losses                         |   | 1,057,992                |        | 824,985                 |   |
|                                              |   |                     |        |                    |   |
|                                              |   | $                        | 153,183,389 |                    | $      | 149,856,081 |   |

 

11

----

 

The allowance forloan losses is established by management of the Bank to incorporate asystematic methodology, which is applied quarterly, to determine the elementsof the allowance for loan losses and the resultant provisions for loan lossesit considers adequate to provide for anticipated loan losses.  This methodology includes the followingelements:

 

• A systematic loan grading system

• A periodic review of the summary of the allowancefor loan loss balance using historical loss factors

• Identification of loans to be evaluated on anindividual basis for impairment

• Consideration of internal factors such as the Bank’ssize, organizational structure, loan portfolio structure, loan administrationprocedures, past due and delinquency trends, and loss experience

• Consideration of risks inherent in different kindsof lending

• Consideration of external factors such as local,regional, and national economic factors

• An overall evaluation of the quality of theunderlying collateral, and holding and disposition costs

 

Specific reservesare provided for individual loans where ultimate collection is consideredquestionable by management after reviewing the current status of loans that arecontractually past due and considering the net realizable value of the securityand of the loan guarantees, if applicable. The following table is an analysis of changes in allowance for loanlosses:

 
|                                            |   | **Nine  Months Ended  September 30, 2003** |      | **Nine  Months Ended  September 30, 2002** |   |
|-------------------------------------------------|--------|--------------------------------------------|-----------|--------------------------------------------|--------|
|                                            |   |                                       |      |                                       |   |
| Balance at beginning of period                  |   | $                                          | 824,985   |                                       | $      | 744,987 |   |
|                                            |   |                                       |      |                                       |   |
| Loans charged-off                               |   | (424,560                                   | )         | (568,482                                   | )      |
| Recoveries                                      |   | 89,567                                     |      | 28,520                                     |   |
|                                            |   |                                       |      |                                       |   |
| Net loans charged-off                           |   | (334,993                                   | )         | (539,962                                   | )      |
| Provision for loan losses charged to operations |   | 568,000                                    |      | 618,000                                    |   |
|                                            |   |                                       |      |                                       |   |
| Balance at end of period                        |   | $                                          | 1,057,992 |                                       | $      | 823,025 |   |

 

 

An analysis of thechanges of loans to directors, executive officers, and major stockholders is asfollows:

 
|                                         |   | **Nine  Months Ended  September 30, 2003** |      | **Year Ended  December 31, 2002** |   |
|----------------------------------------------|--------|--------------------------------------------|-----------|-----------------------------------|--------|
|                                         |   |                                       |      |                              |   |
| Balance at beginning of period               |   | $                                          | 1,523,636 |                              | $      | 1,429,690 |   |
| Loans originated                             |   | 603,700                                    |      | 648,100                           |   |
| Loan principal payments and other reductions |   | (895,892                                   | )         | (554,154                          | )      |
|                                         |   |                                       |      |                              |   |
| Balance at end of period                     |   | $                                          | 1,231,444 |                              | $      | 1,523,636 |   |

 

12

----

 

**NOTE6                 NON-PERFORMINGASSETS**

 

The composition ofthe Bank’s portfolio of non-performing assets is shown in the following table:

 
|                                           |   | **September  30, 2003** |      | **December  31, 2002** |   |
|------------------------------------------------|--------|-------------------------|-----------|------------------------|--------|
|                                           |   |                    |      |                   |   |
| Non-accruing loans*                            |   | $                       | 1,582,918 |                   | $      | 1,623,204 |   |
| Past due 90 days or more and still accruing    |   | —                  |      | —                 |   |
| Troubled debt restructured                     |   | —                  |      | —                 |   |
| Other real estate                              |   | 312,338                 |      | 647,917                |   |
|                                           |   |                    |      |                   |   |
|                                           |   | $                       | 1,895,256 |                   | $      | 2,271,121 |   |
|                                           |   |                    |      |                   |   |
| Ratio of non-performing assets to total assets |   | 0.94                    | %         | 1.18                   | %      |

 

----

 *  Primarilyloans which are past due for 90 days or more

 

**NOTE7                 EARNINGS PER SHARE**

 

Basic earnings percommon share has been computed by dividing net income for the period by theweighted average number of common shares outstanding during the period.  Diluted earnings per common share has beencomputed by dividing net income for the period by the weighted average numberof common shares outstanding during the period adjusted for the assumedexercise of outstanding stock options and other contingently issuable shares ofcommon stock.  Net income for basic anddiluted earnings per share are the same, as there are no contingently issuableshares of stock whose issuance would have impacted net income.

 

A reconciliationbetween basic and diluted weighted average common shares outstanding follows:

 
|                                                      |   | **Three  Months Ended  September 30,** |   | **Nine  Months Ended  September 30,** |   |
|-----------------------------------------------------------|--------|----------------------------------------|--------|---------------------------------------|--------|
|                                                      |   | **2003**                               |   | **2002**                              |   | **2003** |   | **2002** |   |
|                                                      |   |                                   |   |                                  |   |   |   |   |   |
| Weighted average common  Shares – Basic              |   | 1,239,169                              |   | 1,315,409                             |   | 1,254,570 |   | 1,300,876 |   |
|                                                      |   |                                   |   |                                  |   |   |   |   |   |
| Plus effect of dilutive  Securities:                      |   |                                   |   |                                  |   |   |   |   |   |
| Stock Options                                             |   | 67,662                                 |   | 25,374                                |   | 47,188 |   | 24,644 |   |
| Shares held by rabbi trust                                |   | 55,347                                 |   | 37,565                                |   | 52,379 |   | 36,211 |   |
|                                                      |   |                                   |   |                                  |   |   |   |   |   |
| Weighted average common   Shares – Assuming Dilution |   | 1,362,178                              |   | 1,378,348                             |   | 1,354,137 |   | 1,361,731 |   |

 

13

----

 

**Item 2 – Management’s Discussion andAnalysis or Plan of Operation**

** **

**The following discussion should be read in conjunctionwith Access Anytime Bancorp, Inc.’s (“the Company”) 2002 Annual Report on Form10-KSB.**

 

**General**

 

The Company is aDelaware corporation which was organized in 1996 for the purpose of becomingthe thrift holding company of FirstBank (the “Bank”).  The Bank is a federally chartered stock savings bank conductingbusiness from eight banking locations in Albuquerque, Clovis, Gallup, andPortales, New Mexico.  The Bank has awholly owned subsidiary, FEDCO, which is currently inactive.

 

The Bank isprincipally engaged in the business of attracting retail and commercial depositsfrom the general public and investing those funds in first mortgage loans inowner occupied, single-family residential loans, residential construction loansand commercial real estate loans.  Inaddition, the Bank originates consumer loans, including loans for the purchaseof automobiles and home improvement loans, and commercial business loansincluding Small Business Administration loans.

 

The mostsignificant outside factors influencing the operations of the Bank and otherfinancial institutions include general economic conditions, competition in thelocal market place and the related monetary****and fiscal policies of agencies thatregulate financial institutions.  Morespecifically, the cost of funds, primarily consisting of deposits, isinfluenced by interest rates on competing investments and general market ratesof interest.  Lending activities areinfluenced by the demand for real estate financing and other types of loans,which in turn is affected by the interest rates at which such loans may be offeredand other factors affecting loan demand and funds availability.  The Company considers the state of NewMexico as its primary trade area. Federal government outlays in research and development, defense, andagriculture represent a significant portion of the New Mexico economy.

 

On July 21, 2003, the Company and First National Bank Holding Company,a Nevada corporation (“First National Bank”), entered into a merger agreementpursuant to which the Company would have merged with and into First National Bank.The merger transaction was subject to several conditions, including thesatisfactory completion of due diligence by First National Bank on or beforeAugust 15, 2003, the receipt of regulatory approvals and the approval of theCompany’s stockholders.  Upon conclusion of the due diligence review byFirst National Bank, the boards of directors of the two companies determined tomutually terminate the merger agreement effective August 15, 2003.

 

### **Financial Condition**

 

Total assets forthe Company increased by $10,237,694 or 5.33%, from December 31, 2002 toSeptember 30, 2003.  The increase inassets was due to an increase of approximately $14.2 million in cash and cashequivalents.  The increase in cash andcash equivalents was primarily caused by a $9.8 million increase in FHLBadvances, a decrease of $2.2 million in securities available-for-sale, and adecrease of $1.1 million in certificates of deposit.

 

14

----

 

Total liabilitiesincreased by $9,892,747 or 5.58% for the nine-month period ended September 30,2003.  An increase of approximately $9.8million in Federal Home Loan Bank advances was the primary reason for theincrease in total liabilities.  Theincrease in Federal Home Loan Bank advances was primarily used to increase cashand cash equivalents.

 

### **Capital Adequacy and Liquidity**

 

**Capital Adequacy -**Underthe Financial Institutions Reform, Recovery and Enforcement Act of 1989(“FIRREA”) and the implementation of Office of Thrift Supervision (“OTS”)regulations on December 7, 1989, the Bank must have:  (1) Tier 1 or core capital equal to 3% of adjusted total assetsand (2) total capital equal to 8.0% of risk-weighted assets, which includesoff-balance sheet items.

 

Under the FederalDeposit Insurance Corporation Improvement Act (“FDICIA”), to be deemed “wellcapitalized” the minimum ratios the Bank must have are: (1) Tier 1 or corecapital of 5% of adjusted total assets, (2) Tier 1 risk-based capital of 6% ofrisk-weighted assets, and (3) total risk-based capital of 10% of risk weightedassets.

 

The followingtable is a reconciliation of the Bank’s capital for regulatory purposes atSeptember 30, 2003, as reported to the OTS.

 
|                                                               |   | **Tier 1-  Core  Capital** |        | **Tier 1-  Risk-based  Capital** |        | **Total  Risk-based  Capital** |   |
|--------------------------------------------------------------------|--------|----------------------------|-------------|----------------------------------|-------------|--------------------------------|--------|
|                                                               |   |                       |        |                             |        |                           |   |
| Total regulatory assets                                            |   | $                          | 200,142,761 |                             |        |                           |   |   |
| Net unrealized gain on available-for-sale  securities, net         |   | (90,002                    | )           |                             |        |                           |   |
| Less intangible assets disallowed for regulatory  purposes         |   | (1,614,399                 | )           |                             |        |                           |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Adjusted regulatory total assets                                   |   | $                          | 198,438,360 |                             |        |                           |   |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Risk-based assets                                                  |   |                       |        | $                                | 135,725,000 |                           | $      | 135,725,000 |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Stockholder’s equity                                          |   | $                          | 21,461,920  |                             | $           | 21,461,920                     |   | $ | 21,461,920 |   |
| Net unrealized appreciation on available-for-sale  securities, net |   | (54,001                    | )           | (54,001                          | )           | (54,001                        | )      |
| General valuation allowance                                        |   | —                     |        | —                           |        | 842,815                        |   |
| Less intangible assets disallowed for regulatory  purposes         |   | (1,614,399                 | )           | (1,614,399                       | )           | (1,614,399                     | )      |
|                                                               |   |                       |        |                             |        |                           |   |
| Regulatory capital                                                 |   | 19,793,520                 |        | 19,793,520                       |        | 20,636,335                     |   |
| Regulatory capital required to be “well capitalized”     |   | 9,921,918                  |        | 8,143,500                        |        | 13,572,500                     |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Excess regulatory capital                                          |   | $                          | 9,871,602   |                             | $           | 11,650,020                     |   | $ | 7,063,835 |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Bank’s capital to adjusted regulatory assets                  |   | 9.97                       | %           |                             |        |                           |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Bank’s capital to risk-based assets                           |   |                       |        | 14.58                            | %           | 15.20                          | %      |

 

15

----

 

**Liquidity**

 

Liquidity enablesthe Bank to meet withdrawals of its deposits and the needs of its loancustomers.  The Bank maintains itsliquidity position through maintenance of cash resources and a core depositbase.  A further source is the Bank’sability to borrow funds.  The Bank is amember of the Federal Home Loan Bank (“FHLB”) which provides a source ofborrowings to the Bank for asset and asset/liability matching.  FHLB borrowings were $18.1 and $8.3 millionat September 30, 2003 and December 31, 2002, respectively.

 

Liquidity risk results from the mismatching of assets and liabilitycash flows.  Management choosesasset/liability strategies that promote stable earnings and reliablefunding.  Interest rate risk and fundingpositions are kept within limits established by the Board of Directors of theBank to ensure that risk taking is not excessive and that liquidity is properlymanaged.  The Bank keeps a portion of itsinterest-bearing assets in adjustable-rate products to reduce interest ratesensitivity.  Therefore, if ratesincrease the Bank can retain its deposits by increasing rates paid on deposits,while limiting the impact on the Bank’s net interest margin.  A concentrated effort is made to retaindeposits associated with an unidentifiable intangible asset.  The primary additional source of funding isprovided by FHLB borrowings available to the Bank, of $53.3 and $59.8million at September 30, 2003 and December 31, 2002, respectively.

 

At September 30, 2003 and 2002, the Company had available lines ofcredit totaling $200,000 and $400,000 respectively, from other banks.Borrowings outstanding under these arrangements were $0 and $0 at September 30,2003 and 2002, respectively.  The linesof credit bear market rates of interest and borrowings thereunder are to beused for general Company purposes.

 

 

# **Resultsof Operations**

### ** **

### **Three-Month Comparative Analysis for Periods September30, 2003 and 2002**

 

Net income for thethree-months ended September 30, 2003 was $384,949 or $.31 per basic sharecompared to $226,762 or $.17 per basic share for the three-months endedSeptember 30, 2002, an increase of $158,187 or 69.76%.

 

*Net Interest Income.*  Net interest income before provision forloan losses increased by 5.28% to $1,777,261 in the three-month period endedSeptember 30, 2003, compared to $1,688,115 for the same period in 2002.  The increase in net interest income beforeprovision for loan losses was primarily due to a decrease in interest expenseof $246,133.  The decrease in totalinterest expense for the quarter ended September 30, 2003 was due to a decreasein interest expense on deposits of $258,932, as compared to the same quarter in2002.

 

*Provision for Loan Losses.* The level of the allowance for loanlosses is based on such factors as the amount of non-performing assets,historical loss experience, general economic conditions, the estimated fairvalue of the underlying collateral, and other factors which may affect thecollectibility of loans.  During thethird quarter of 2003, the provision for loan losses decreased to $213,000 from$238,000 in the third quarter of 2002. Additional provisions were made in 2002 as determined by management

 

16

----

 

analysis for oneparticular credit, which was subsequently resolved and charged-off.  The related allowance for loan lossesincreased in the quarter ended September 30, 2003 as a result of lowercharge-offs as compared to 2002.  Basedon management’s analysis of current conditions and changes in the loan mix, asindicated by increases in commercial real estate, automobile, and credit cardloans, the allowance is considered appropriate.  Although management believes it uses the best informationavailable to make such determinations, future adjustments to the allowance maybe necessary, and net income could be significantly affected, if circumstancesdiffer substantially from the assumptions used in making initialdeterminations.  See Note 5 to theConsolidated Financial Statements in this Form 10-QSB for additional discussionon the allowance for loan losses.

 

*Noninterest Income.*  During the three-months ended September 30,2003, noninterest income increased by $551,510 to $1,170,461 compared to$618,951 in 2002.  The increase innoninterest income for the quarter ended September 30, 2003 as compared to thesame quarter in 2002 was primarily due to an increase in gains on sales ofmortgage loans held-for-sale of $433,407 and loan servicing and other fees of$128,135.  The gains on sales ofmortgage loans held-for-sale for the quarter were $641,192; however, thesegains are expected to decrease as refinancing of mortgage loans demanddecreases.

 

*Noninterest Expense.*  Noninterest expense increased to $2,426,475from $1,694,319 for the quarter ended September 30, 2003 compared to the samequarter in 2002.  The $732,156 increasein noninterest expense was primarily due to an increase in sales incentives asshown in salaries and employee benefits of $542,463 and professional fees of$235,280.  The increase in salaries andemployee benefits is primarily due to the increase in sales incentives based onloan production in the third quarter of 2003, however, this expense is expectedto decrease as refinancing of mortgage loans demand decreases.  The increase in professional fees wasprimarily due to a $169,498 charge for fees associated with the proposed mergerwith First National Bank Holding Company, which was subsequentlyterminated.  The $169,498 feesassociated with the proposed merger, adjusted for taxes, represent $.07 perdiluted share for the quarter ended September 30, 2003, and without theexpenses related to the proposed merger net income would have been an increaseof $101,698 to $486,647 for the quarter as compared to net income of $226,762for the quarter ended September 30, 2002.

 

*Income Tax (Benefit) Expense.*  The income tax benefit of $76,702 for thequarter ended September 30, 2003 as compared to an expense of $147,985 in thequarter ended September 30, 2002 results primarily from the deferred tax assetvaluation adjustment of $200,000 in the quarter ended September 30, 2003.  Based on third quarter operating results,the Company changed its estimate with respect to the future benefits of thestate of New Mexico net operating loss (“State NOL”) carryforwards and,accordingly, reduced the valuation allowance. The State NOL carryforwards expire through 2005.  (See additional discussion in Note 11 of theaudited consolidated financial statements of the Company for the year endedDecember 31, 2002.)  Based on theCompany’s historical taxable transactions, the timing of the reversal ofexisting temporary differences, and the evaluation of tax planning strategies,management believes it is more likely than not that the Company’s futuretaxable income will be sufficient to realize the benefit of the remainingdeferred tax asset.

 

17

----

 

### **Nine-Month Comparative Analysis for PeriodsSeptember 30, 2003 and 2002**

### ** **

Net income for thenine-months ended September 30, 2003 was $1,113,110 or $.89 per basicshare compared to $628,737 or $.48 per share for the nine-months endedSeptember 30, 2002, an increase of $484,373 or 77.04%.

 

*Net Interest Income.*  Net interest income before provision forloan losses increased by 6.05% to $5,286,900 in the nine-month period endedSeptember 30, 2003, compared to $4,985,310 for the same period in2002.  The increase in net interestincome before provision for loan losses was primarily due to a decrease ininterest expense of $624,807.  Thedecrease in total interest expense for the nine-months ended September 30,2003 was due to a decrease in interest expense on deposits of $740,963, ascompared to the same period in 2002.

 

*Provision for Loan Losses.*  The level of the allowance for loan lossesis based on such factors as the amount of non-performing assets, historicalloss experience, general economic conditions, the estimated fair value of theunderlying collateral and other factors which may affect the collectibility ofloans.  During the first nine-months of2003, the provision for loan losses decreased to $568,000 from $618,000 in thefirst nine-months of 2002.  The decreasewas due to management’s analysis of current conditions.  Although management believes it uses thebest information available to make such determinations, future adjustments tothe allowance may be necessary, and net income could be significantly affected,if circumstances differ substantially from the assumptions used in makinginitial determinations.  See Note 5 inthis Form 10-QSB for additional discussion on the allowance for loan losses.

 

*Noninterest Income.*  During the first nine-months of 2003,noninterest income increased by $1,612,560 to $3,063,312 compared to $1,450,752the first nine-months of 2002.  Theincrease in noninterest income for the nine-months ended September 30,2003 as compared to the same period in 2002 was primarily due to an increase ingains on sales of mortgage loans held-for-sale of $1,345,471.

 

*Noninterest Expense.*  Noninterest expense increased to $6,262,475from $4,770,167 for the nine-months ended September 30, 2003 compared tothe same period in 2002.  The $1,492,308increase in noninterest expense was primarily due to an increase in salesincentives as shown in salaries and employee benefits of $1,010,413,professional fees of $285,602, and other expense of $152,651.  The increase in salaries and employeebenefits is primarily due to the increase in sales incentives based on loanproduction in the first nine-months of 2003, and the increase in other expenseis primarily due to expenses due to the increase in loan production.  The increase in professional fees wasprimarily due to a $169,498 charge for fees associated with the proposed mergerwith First National Bank Holding Company, which was subsequentlyterminated.  The $169,498 feesassociated with the proposed merger, adjusted for taxes, represent $.08 perdiluted share for the nine-months ended September 30, 2003, and withoutthe expenses related to the proposed merger net income would have been anincrease of $101,698 to $1,214,808 for the nine-months as compared to netincome of $628,737 for the nine-months ended September 30, 2002.

 

18

----

 

*Income Tax Expense.*  The income tax expense for the nine-monthsended September 30, 2003 decreased by $12,531 to $406,627 from $419,158 inthe nine-months ended September 30, 2002. Based on third quarter operating results, the Company changed itsestimate with respect to the future benefits of the state of New Mexico netoperating loss (“State NOL”) carryforwards and, accordingly, reduced thevaluation allowance.  The State NOLcarryforwards expire through 2005.  (Seeadditional discussion in Note 11 of the audited consolidated financialstatements of the Company for the year ended December 31, 2002.)  Based on the Company’s historical taxabletransactions, the timing of the reversal of existing temporary differences, andthe evaluation of tax planning strategies, management believes it is morelikely than not that the Company’s future taxable income will be sufficient torealize the benefit of the remaining deferred tax asset.

 

**Net Interest Income**

 

The Company’soperating results are impacted by many factors, the most important factor beingthe interest spread between the yield on loans and investments and the cost offunds.  The following table presentsoperating results for the Company.  Thetable presents for the periods indicated the total dollar amount of interestincome from average interest-earning assets and the resultant yields, as wellas the interest expense on average interest-bearing liabilities, expressed bothin dollars and rates.  No tax equivalentadjustments were made and all average balances are monthly averagebalances.  Non-accruing loans have beenincluded in the table as loans carrying a zero yield.

 

19

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|                                                                     |   | **Three  Months ended September 30,** |        |
|--------------------------------------------------------------------------|--------|--------------------------------------------|-------------|
|                                                                     |   | **2003**                                   |        | **2002** |   |
|                                                                     |   | **Average  outstanding balance**           |        | **Interest  earned/  Paid** |   | **Yield/  Rate** |   | **Average  outstanding  balance** |   | **Interest  earned/  Paid** |   | **Yield/  Rate** |   |
|                                                                     |   |                                       |        |   |   |   |   |   |   |   |   |   |   |
| Interest-earning assets:                                                 |   |                                       |        |   |   |   |   |   |   |   |   |   |   |
| Loans receivable (1)                                                     |   | $                                          | 166,481,099 |   | $ | 2,700,382 |   | 6.49 | % | $ | 156,640,540 |   | $ | 2,785,695 |   | 7.11 | % |
| Mortgage-backed securities                                               |   | 4,452,780                                  |        | 48,891 |   | 4.39 |   | 8,034,423 |   | 112,510 |   | 5.60 |   |
| Investment securities                                                    |   | 2,916,668                                  |        | 34,993 |   | 4.80 |   | 3,358,752 |   | 46,397 |   | 5.53 |   |
| Other interest-earning assets                                            |   | 23,599,077                                 |        | 78,013 |   | 1.32 |   | 14,324,116 |   | 74,664 |   | 2.08 |   |
|                                                                     |   |                                       |        |   |   |   |   |   |   |   |   |   |   |
| Total interest-earning assets (1)                                        |   | $                                          | 197,449,624 |   | $ | 2,862,279 |   | 5.80 | % | $ | 182,357,831 |   | $ | 3,019,266 |   | 6.62 | % |
|                                                                     |   |                                       |        |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities:                                            |   |                                       |        |   |   |   |   |   |   |   |   |   |   |
| Deposits                                                                 |   | $                                          | 161,006,811 |   | $ | 804,415 |   | 2.00 | % | $ | 159,549,811 |   | $ | 1,063,347 |   | 2.67 | % |
| Federal Home Loan Bank advances                                          |   | 18,222,078                                 |        | 116,820 |   | 2.56 |   | 9,521,505 |   | 81,872 |   | 3.44 |   |
| Other borrowings                                                         |   | 8,000,000                                  |        | 163,783 |   | 8.19 |   | 9,021,649 |   | 185,932 |   | 8.24 |   |
|                                                                     |   |                                       |        |   |   |   |   |   |   |   |   |   |   |
| Total interest-bearing liabilities                                       |   | $                                          | 187,228,889 |   | $ | 1,085,018 |   | 2.32 | % | $ | 178,092,965 |   | $ | 1,331,151 |   | 2.99 | % |
|                                                                     |   |                                       |        |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                                      |   |                                       |        | $ | 1,777,261 |   |   |   |   |   | $ | 1,688,115 |   |   |   |
| Net interest rate spread                                                 |   |                                       |        |   |   | 3.48 | % |   |   |   |   | 3.63 | % |
|                                                                     |   |                                       |        |   |   |   |   |   |   |   |   |   |   |
| Net interest-earning assets                                              |   | $                                          | 10,220,735  |   |   |   |   |   | $ | 4,264,866 |   |   |   |   |   |
| Net yield on average interest-earning assets                             |   |                                       |        |   |   | 3.60 | % |   |   |   |   | 3.70 | % |
|                                                                     |   |                                       |        |   |   |   |   |   |   |   |   |   |   |
| Average interest-earning assets to average  interest-bearing liabilities |   |                                       |        | 105.46 | % |   |   |   |   | 102.39 | % |   |   |

 

----

(1) Calculated netof loans in process

 
|                                                                     |   | **Nine Months ended September 30,** |        |
|--------------------------------------------------------------------------|--------|------------------------------------------|-------------|
|                                                                     |   | **2003**                                 |        | **2002** |   |
|                                                                     |   | **Average  outstanding  balance**        |        | **Interest  earned/  Paid** |   | **Yield/  Rate** |   | **Average  outstanding  balance** |   | **Interest  earned/  Paid** |   | **Yield/  Rate** |   |
|                                                                     |   |                                     |        |   |   |   |   |   |   |   |   |   |   |
| Interest-earning assets:                                                 |   |                                     |        |   |   |   |   |   |   |   |   |   |   |
| Loans receivable (1)                                                     |   | $                                        | 162,799,648 |   | $ | 8,075,827 |   | 6.61 | % | $ | 151,121,396 |   | $ | 8,213,133 |   | 7.25 | % |
| Mortgage-backed securities                                               |   | 5,189,027                                |        | 187,829 |   | 4.83 |   | 9,023,806 |   | 396,690 |   | 5.86 |   |
| Investment securities                                                    |   | 2,961,054                                |        | 111,027 |   | 5.00 |   | 3,038,915 |   | 136,966 |   | 6.01 |   |
| Other interest-earning assets                                            |   | 20,615,079                               |        | 228,491 |   | 1.48 |   | 12,064,374 |   | 179,602 |   | 1.98 |   |
|                                                                     |   |                                     |        |   |   |   |   |   |   |   |   |   |   |
| Total interest-earning assets (1)                                        |   | $                                        | 191,564,808 |   | $ | 8,603,174 |   | 5.99 | % | $ | 175,248,491 |   | $ | 8,926,391 |   | 6.79 | % |
|                                                                     |   |                                     |        |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities:                                            |   |                                     |        |   |   |   |   |   |   |   |   |   |   |
| Deposits                                                                 |   | $                                        | 159,037,144 |   | $ | 2,511,051 |   | 2.11 | % | $ | 154,535,761 |   | $ | 3,252,014 |   | 2.81 | % |
| Federal Home Loan Bank advances                                          |   | 15,887,753                               |        | 316,056 |   | 2.65 |   | 9,652,483 |   | 260,086 |   | 3.59 |   |
| Other borrowings                                                         |   | 8,000,000                                |        | 489,167 |   | 8.15 |   | 6,443,273 |   | 428,981 |   | 8.88 |   |
|                                                                     |   |                                     |        |   |   |   |   |   |   |   |   |   |   |
| Total interest-bearing liabilities                                       |   | $                                        | 182,924,897 |   | $ | 3,316,274 |   | 2.42 | % | $ | 170,631,517 |   | $ | 3,941,081 |   | 3.08 | % |
|                                                                     |   |                                     |        |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                                      |   |                                     |        | $ | 5,286,900 |   |   |   |   |   | $ | 4,985,310 |   |   |   |
| Net interest rate spread                                                 |   |                                     |        |   |   | 3.57 | % |   |   |   |   | 3.71 | % |
|                                                                     |   |                                     |        |   |   |   |   |   |   |   |   |   |   |
| Net interest-earning assets                                              |   | $                                        | 8,639,911   |   |   |   |   |   | $ | 4,616,974 |   |   |   |   |   |
| Net yield on average interest-earning assets                             |   |                                     |        |   |   | 3.68 | % |   |   |   |   | 3.79 | % |
|                                                                     |   |                                     |        |   |   |   |   |   |   |   |   |   |   |
| Average interest-earning assets to average  interest-bearing liabilities |   |                                     |        | 104.72 | % |   |   |   |   | 102.71 | % |   |   |

 

----

(1) Calculated netof loans in process

 

20

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**Item 3 – Controls and Procedures**

 

**Evaluationof Disclosure Controls and Procedures**

** **

**TheCompany carried out an evaluation, under the supervision and with theparticipation of the Company’s management, including the Company’s ChiefExecutive Officer and Chief Financial Officer, of the effectiveness of thedesign and operation of the Company’s disclosure controls and procedures as ofthe end of the period covered by this report. The Company’s disclosure controls and procedures are designed to ensurethat information required to be disclosed by the Company in its periodicSecurities and Exchange Commission (“SEC”) filings is recorded, processed andreported within the time periods specified in the SEC’s rules and forms.  Based on that evaluation, the Chief ExecutiveOfficer and Chief Financial Officer concluded that the Company’s disclosurecontrols and procedures are effective in timely alerting them to materialinformation relating to the Company (including its consolidated subsidiaries)required to be included in the Company’s periodic SEC filings.  There was no change in the registrant’sinternal control over financial reporting that occurred during the registrant’smost recent fiscal quarter that has materially affected, or is reasonablylikely to materially affect, the Company’s internal control over financialreporting.**

** **

**Forward-Looking Statements**

 

When used in this Form 10-QSB, certain words orphrases are intended to identify “forward-looking statements” within themeaning of the Private Securities Litigation Reform Act of 1995.  Such statements are subject to certain risksand uncertainties, including changes in economic conditions, including changesin governmental outlays in the Company’s market area, changes in policies byregulatory agencies, fluctuations in interest rates, demand for loans in theCompany’s market area and competition, that could cause actual results todiffer materially from historical earnings and those presently anticipated orprojected.  The Company wishes tocaution readers not to place undue reliance on any such forward-lookingstatements, which speak only as of the date made.  The Company wishes to advise readers that the factors listedabove could affect the Company’s financial performance and could cause theCompany’s actual results for future periods to differ materially from anyopinions or statements expressed with respect to future periods in any currentstatements.

 

The Company doesnot undertake, and specifically disclaims any obligation, to publicly releasethe results of any revisions which may be made to any forward-lookingstatements to reflect events or circumstances after the date of such statementsor to reflect the occurrence of anticipated or unanticipated events.

 

21

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##### **PART II –  OTHER INFORMATION**

##### ** **

# **Item 1 – LegalProceedings**

# **None**

# ** **

# **Item 2 – Changesin Securities**

# **None**

# ** **

# **Item 3 – DefaultsUpon Senior Securities**

# **None**

# ** **

# **Item 4 –Submission of Matters to a Vote of Security Holders**

None

 

# **Item 5 – OtherInformation**

# **None**

# ** **

# **Item 6 – Exhibitsand Reports on Form 8-K**

# ** **

(a)       Exhibits

31.1 Certification of Chief Executive Officer asadopted pursuant to section 302 of the Sarbanes-Oxley Act of 2002

 

31.2 Certification of Chief Financial Officer asadopted pursuant to section 302 of the Sarbanes-Oxley Act of 2002

 

32.1 Certification of Chief Executive Officer pursuantto 18 U.S.C. section 1350, as adopted pursuant to section 906 of theSarbanes-Oxley Act of 2002

 

32.2 Certification of Chief Financial Officer pursuantto 18 U.S.C. section 1350, as adopted pursuant to section 906 of theSarbanes-Oxley Act of 2002

 

(b)       Reportson Form 8-K.

1.  OnJuly 21, 2003 the Company filed a Form 8-K to announce that it had enteredinto an Agreement and Plan of Merger with First National Bank Holding Company.

 

2.  OnJuly 31, 2003 the Company furnished a Form 8-K to announce its unauditedresults of operations for the six months ended June 30, 2003.

 

3.  OnAugust 21, 2003 the Company filed a Form 8-K to announce that theAgreement and Plan of Merger with First National Bank Holding Company wasterminated.

 

22

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# **SIGNATURES**

# ** **

Pursuant to the requirements of Section 13 or15(d) of the Securities Exchange Act of 1934, the Registrant has duly causedthis report to be signed on its behalf by the undersigned, thereunto dulyauthorized.

 

 

 
|                              |                   | ACCESS ANYTIME  BANCORP, INC.              |
|-----------------------------------|------------------------|--------------------------------------------|
|                              |                   |
|                              |                   |
| Date:  October 31, 2003 | /s/ Norman R.  Corzine |                                       |
|                              |                   | Norman  R. Corzine, Chairman of the Board, |
|                              |                   | Chief  Executive Officer                   |
|                              |                   | *(Duly Authorized Representative)*         |
|                              |                   |
|                                   |                        |                                            |  |  |

 
| Date:  October 31, 2003 | /s/ Ken Huey,  Jr. |                                            |
|-----------------------------------|--------------------|-------------------------------------------------|
|                              |               | Ken  Huey, Jr., Chief Financial Officer         |
|                              |               | Director                                        |
|                              |               | *(Principal Financial and  Accounting Officer)* |
|                              |               | *(Duly Authorized Representative)*              |
|                                   |                    |                                                 |  |

 
| Date:  October 31, 2003 | /s/ Don K.  Padgett |                               |
|-----------------------------------|---------------------|------------------------------------|
|                              |                | Don  K. Padgett, President         |
|                              |                | Director                           |
|                              |                | *(Duly Authorized Representative)* |
|                              |                |                               |
|                                   |                     |                                    |  |

 

23

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