UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20519

                                    FORM 10-Q


(Mark One)

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

For the quarterly period ended   June 30, 1997
                               ---------------- 

                                       or

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

For the transition period from                         to
                               -----------------------    ---------------------

Commission File Number:  0-23620
                         -------

   Mid Continent Bancshares, Inc.
--------------------------------------------------------------------------------
Exact name of registrant as specified in its charter

 Kansas                                                          48-1146797
--------------------------------------------------------------------------------
(State or other jurisdiction of         (I.R.S. Employer Identification No.)
Incorporation or organization)        

 124 West Central,  El Dorado, Kansas                                     67042
--------------------------------------------------------------------------------
(Address of principal executive offices)                            (Zip Code)

                                 (316) 321-2700
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

                                       N/A
--------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last 
report)

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


   Indicate the number of shares  outstanding of each of the Issuer's classes of
common stock, as of the latest practicable date.

                  Date:    July 31, 1997
                  Class:  $0.10 par value, common stock
                  Outstanding: 1,958,250 shares


<PAGE>


MID CONTINENT BANCSHARES, INC.

INDEX


                                                                    Page Number

PART I - CONSOLIDATED FINANCIAL INFORMATION

Consolidated Balance Sheets as of June 30, 1997 (Unaudited)
and September 30, 1996                                                   3

Consolidated Statements of Income for the Three and Nine Months
Ended June 30, 1997 and 1996 (Unaudited)                                 4

Consolidated Statement of Stockholders' Equity for the Nine
Months Ended June 30, 1997 (Unaudited)                                   5

Consolidated Statements of Cash Flows for the Nine Months
Ended June 30, 1997 and 1996 (Unaudited)                                 6

Notes to Consolidated Financial Statements (Unaudited)                   7-11

Management's Discussion and Analysis of Financial
Condition and Results of Operations                                      12-19

PART II - OTHER INFORMATION                                              20

SIGNATURES                                                               21






















                                       2
<PAGE>



                         MID CONTINENT BANCSHARES, INC.

                                     PART I

MID CONTINENT BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
<TABLE>
<CAPTION>

                                                                                           September 30,       June 30,
                                                                                               1996              1997
                                                                                                             (Unaudited)
                                                                                        ------------------------------------
                                                                                             
<S>                                                                                            <C>               <C>     
ASSETS
CASH AND CASH EQUIVALENTS:
   Cash and amounts due from depository institutions                                             $1,694            $1,449
   Interest bearing deposits in other banks                                                       3,924             8,076
                                                                                                  -----             -----
      Total cash and cash equivalents                                                             5,618             9,525
INVESTMENT SECURITIES                                                                            86,235           107,171
CAPITAL STOCK OF FEDERAL HOME LOAN BANK, at Cost                                                  4,327             6,556
MORTGAGE-RELATED SECURITIES                                                                      34,383            30,458
LOANS HELD FOR SALE, at lower of cost or market value                                            13,718            15,147
LOANS RECEIVABLE (Less allowance for loan losses of $421 and $427)                              171,158           213,194
PREMISES AND EQUIPMENT, Net                                                                       6,271             7,250
REAL ESTATE OWNED (Less allowance for losses of $34 and $30)                                         28                14
ACCRUED INTEREST RECEIVABLE                                                                       2,744             3,877
EXCESS OF COST OVER FAIR VALUE OF ASSETS ACQUIRED (Less accumulated
 amortization of $1,055 and $1,077)                                                                  22                --
MORTGAGE SERVICING RIGHTS, Net                                                                   12,496            13,233
OTHER ASSETS                                                                                      3,186             2,165
                                                                                                  -----             -----
TOTAL ASSETS                                                                                   $340,186          $408,590
                                                                                               ========          ========



LIABILITIES AND STOCKHOLDERS' EQUITY
DEPOSITS                                                                                       $214,493          $247,010
ADVANCE PAYMENTS BY BORROWERS FOR TAXES AND INSURANCE                                             1,805             1,195
INCOME TAXES PAYABLE, Net of deposits                                                                                 328
DEFERRED INCOME TAXES                                                                               698               698
ACCRUED AND OTHER LIABILITIES                                                                     4,683             4,900
ADVANCES FROM FEDERAL HOME LOAN BANK                                                             81,700           116,100
                                                                                                 ------           -------
      Total liabilities                                                                         303,379           370,231

COMMITMENTS AND CONTINGENT LIABILITIES

STOCKHOLDERS' EQUITY:
PREFERRED STOCK, no par value, 10,000,000 shares authorized, no shares issued or outstanding
COMMON STOCK, $0.10 par value, 20,000,000 shares authorized, 2,248,250 shares issued                225               225
ADDITIONAL PAID-IN CAPITAL                                                                       21,663            21,810
LESS UNEARNED COMPENSATION-EMPLOYEE STOCK OWNERSHIP PLAN                                        (1,054)             (946)
LESS UNEARNED COMPENSATION-MANAGEMENT STOCK BONUS PLAN                                            (547)             (398)
RETAINED EARNINGS, Substantially restricted                                                      20,424            23,054
                                                                                                 ------            ------
      Total                                                                                      40,711            43,745
TREASURY STOCK, 231,500 and 290,000 shares, at cost                                             (3,904)           (5,386)
                                                                                                -------           -------
      Total stockholders' equity                                                                 36,807            38,359
                                                                                                 ------            ------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                     $340,186          $408,590
                                                                                               ========          ========
</TABLE>
See notes to consolidated financial statements









                                       3
<PAGE>

MID CONTINENT BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in Thousands Except Share Amounts)
<TABLE>
<CAPTION>

                                                                       THREE MONTHS ENDED             NINE MONTHS ENDED
                                                                            June 30,                      June 30,
                                                                 ----------------------------------------------------------------
                                                                      1996            1997            1996            1997
                                                                  (Unaudited)      (Unaudited)     (Unaudited)     (Unaudited)
<S>                                                                   <C>             <C>             <C>              <C>      
INTEREST INCOME:
   Loans receivable                                                      $2,899          $4,071          $8,399          $11,404
   Mortgage-related securities                                              738             645           2,220            1,931
   Investment securities                                                  1,379           1,937           3,631            5,476
   Other interest-cash and cash equivalents                                  73              19             272              147
                                                                 -----------------------------------------------------------------
      Total interest income                                               5,089           6,672          14,522           18,958
                                                                 ---------------------------------------------------------------

INTEREST EXPENSE:
   Deposits                                                               2,429           2,687           7,013            8,158
   Advances from Federal Home Loan Bank                                     622           1,607           1,757            4,119
                                                                 -----------------------------------------------------------------
      Total interest expense                                              3,051           4,294           8,770           12,277
                                                                 -----------------------------------------------------------------

NET INTEREST INCOME                                                       2,038           2,378           5,752            6,681

PROVISION FOR LOAN LOSSES                                                    30              76              23              101
                                                                 -----------------------------------------------------------------

NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES                       2,008           2,302           5,729            6,580
                                                                 -----------------------------------------------------------------

OTHER INCOME:
   Loan servicing fees                                                    1,190           1,219           3,596            3,619
   Amortization of mortgage servicing rights                              (413)           (441)         (1,273)          (1,303)
   Service fees and other charges to customers                              618             805           1,868            2,215
   Gain on sale of loans, net                                               277             258           1,020              774
   Insurance commissions                                                      3              51              50               70
   Other                                                                     80               2              83               77
                                                                 -----------------------------------------------------------------
      Total other income                                                  1,755           1,894           5,344            5,452
                                                                 -----------------------------------------------------------------

OTHER EXPENSE:
   Salaries and employee benefits                                         1,201           1,174           3,483            3,437
   Occupancy of premises                                                    250             284             711              866
   Office supplies and related expenses                                     156             190             483              505
   Data processing                                                          147             158             439              449
   Advertising and promotions                                               126             128             336              365
   Federal insurance premiums                                               111              37             332              168
   Professional services                                                     70              74             205              209
   Provision for losses on real estate owned                                 --              --              18               10
   Amortization of excess cost over fair value of asset acquired             14              --              47               22
   Deposit account expense                                                   73              85             210              244
   Loan servicing expense                                                   101              68             257              193
   Other                                                                     50             121             295              345
                                                                 -----------------------------------------------------------------
      Total other expenses                                                2,299           2,319           6,816            6,813
                                                                 -----------------------------------------------------------------

INCOME BEFORE INCOME TAX EXPENSE                                          1,464           1,877           4,257            5,219

INCOME TAX EXPENSE                                                          569             750           1,591            2,026
                                                                 -----------------------------------------------------------------

NET INCOME                                                                 $895          $1,127          $2,666           $3,193
                                                                 =================================================================

Earnings per share                                                        $0.46           $0.59           $1.35            $1.65
                                                                 =================================================================
Weighted average shares outstanding                                   1,951,916       1,921,372       1,972,049        1,934,536
                                                                 =================================================================

</TABLE>
See notes to consolidated financial statements



                                        4



<PAGE>

MID CONTINENT BANCSHARES, INC.


CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
NINE MONTHS ENDED JUNE 30, 1997
(Dollars in Thousands)

<TABLE>
<CAPTION>

                                                        Unearned                                                     
                                                      Compensation      Unearned
                                                       - Employee     Compensation    Retained
                                          Additional      Stock         Management    Earnings,                          Total
                     Common Stock          Paid-In     Ownership       Stock Bonus  Substantially     Treasury Stock  Stockholders'
                  Shares       Amount     Capital         Plan            Plan       Restricted     Shares    Amount  Equity
<C>                <C>             <C>    <C>             <C>              <C>         <C>          <C>      <C>         <C>    
BALANCE, 
October 1,
1996               2,248,250       $225   $21,663          ($1,054)        ($547)      $20,424      231,500  ($3,904)    $36,807

Acquisition
of Treasury
Stock                                                                                                58,500   (1,482)     (1,482)

Common stock
committed to
be released
for allocation
- Employee
Stock Ownership
Plan                                                           108                                                           108

Increase in
fair market
value of 
Employee
Stock Ownership
Plan shares
committed to be
released for
allocation                                    147                                                                            147

Amortization
of unearned
compensation -
Management
Stock Bonus Plan                                                             149                                             149

Dividends on
common stock
to stockholders                                                                           (563)                             (563)

Net income                                                                               3,193                             3,193

                   -----------------------------------------------------------------------------------------------------------------
BALANCE,
June 30,
1997               2,248,250       $225   $21,810            ($946)        ($398)      $23,054      290,000  ($5,386)    $38,359
                   =================================================================================================================
</TABLE>

See notes to consolidated financial statements



                                       5




<PAGE>
MID CONTINENT BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
<TABLE>
<CAPTION>
                                                                                                  NINE MONTHS ENDED
                                                                                                       JUNE 30,

                                                                                                1996             1997
                                                                                            (Unaudited)      (Unaudited)
                                                                                        ------------------------------------
<S>                                                                                              <C>             <C>      
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income                                                                                       $2,666          $3,193
   Adjustments to reconcile net income to net cash provided by (used in) operating
    activities:
   Common stock committed to be released for allocation - Employee Stock Ownership
    Plan                                                                                               107             108
   Increase in fair market value of Employee Stock Ownership Plan shares committed
    to be released for allocation                                                                       81             147
   Amortization of unearned compensation - Management Stock Bonus Plan                                 149             149
   Stock dividend on capital stock in Federal Home Loan Bank                                          (110)           (245)
   Amortization of premiums and discounts on mortgage-related securities and
    investment  securities, net                                                                       (113)            (79)
   Provision for loan losses                                                                            23             101
   Provision for losses on real estate owned                                                            18              10
   Net loan origination fees capitalized                                                             1,481             722
   Amortization of net deferred loan origination fees                                                 (116)            (57)
   Amortization of mortgage servicing rights                                                         1,273           1,303
   Impairment of mortgage servicing rights                                                              --               8
   Amortization of excess of costs over fair value of asset acquired                                    47              22
   Gain on sale of real estate owned                                                                    --             (34)
   Depreciation on premises and equipment                                                              350             386
   Gain on sale of loans, net                                                                       (1,020)           (774)
   Origination of loans held for sale                                                             (148,675)       (155,339)
   Proceeds from sale of loans held for sale                                                       157,934         154,684
   Changes in:
      Accrued interest receivable                                                                     (683)         (1,133)
      Other assets                                                                                    (200)            565
      Income taxes payable                                                                            (293)            783
      Accrued and other liabilities                                                                  1,067             221
                                                                                        ------------------------------------
             Net cash provided by operating activities                                              13,986           4,741
                                                                                        ------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Proceeds from maturity or call of investment securities                                          29,000          11,000
   Purchases of investment securities                                                              (61,313)        (33,820)
   Principal collected on mortgage-related securities                                                5,145           3,904
   Purchase of mortgage-related securities                                                          (1,158)              --
   Origination of loans receivable, net of principal collection                                    (21,731)        (43,067)
   Acquisitions of mortgage servicing rights                                                        (1,878)         (2,047)
   Purchases of premises and equipment                                                              (1,388)         (1,366)
   Proceeds from sales of real estate owned                                                            327             304
                                                                                        ------------------------------------
             Net cash used in investing activities                                                 (52,996)        (65,092)
                                                                                        ------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Receipts for deposits, net                                                                       19,498          32,517
   Net decrease in advance payments by borrowers for taxes and insurance                              (890)           (610)
   Proceeds from advances from Federal Home Loan Bank                                               88,800         253,980
   Repayments on advances from Federal Home Loan Bank                                              (65,300)       (219,580)
   Cash dividend on common stock to stockholders                                                      (597)           (567)
   Acquisition of Treasury Stock                                                                    (2,450)         (1,482)
                                                                                        ------------------------------------
             Net cash provided by financing activities                                              39,061          64,258
                                                                                        ------------------------------------
INCREASE IN CASH AND CASH EQUIVALENTS                                                                   51           3,907
CASH AND CASH EQUIVALENTS:
   Beginning of period                                                                               5,677           5,618
                                                                                        ------------------------------------
   End of period                                                                                    $5,728          $9,525
                                                                                        ====================================
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
   Income tax payments                                                                              $1,884          $1,243
                                                                                        ====================================
   Interest payments                                                                                $8,781         $12,359
                                                                                        ====================================
   Loans held for sale securitized into mortgage-related securities                                $66,577         $62,416
                                                                                        ====================================
   Loans transferred to real estate owned                                                             $178            $266
                                                                                        ====================================
   Accrued dividends on common stock                                                                  $192            $186
                                                                                        ====================================
</TABLE>
See notes to consolidated financial statements
                                       6
<PAGE>



                         MID CONTINENT BANCSHARES, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


1.  PRINCIPLES OF CONSOLIDATION

The  consolidated  financial  statements  include the accounts of Mid  Continent
Bancshares, Inc., (the Company), and its wholly-owned subsidiary,  Mid-Continent
Federal Savings Bank (the Bank) and its subsidiary,  Laredo Investment, Inc. All
significant  intercompany  accounts and  transactions  have been  eliminated  in
consolidation.

2.  BASIS OF PRESENTATION

The consolidated balance sheet as of June 30, 1997, the consolidated  statements
of  income  for the  three  and  nine  months  ended  June 30,  1996  and  1997,
stockholders'  equity for the nine months ended June 30, 1997 and cash flows for
the nine months ended June 30, 1996 and 1997, have been prepared by the Company,
without audit, and therefore do not include  information or footnotes  necessary
for a complete  presentation of  consolidated  financial  condition,  results of
operations,  and cash flows in conformity  with  generally  accepted  accounting
principles. It is suggested that these consolidated financial statements be read
in  conjunction  with the  September  30, 1996  financial  statements  and notes
thereto  included  in the  Annual  Report  of the  Company.  In the  opinion  of
management,  all adjustments  (consisting of only normal recurring  adjustments)
necessary for the fair  presentation of the  consolidated  financial  statements
have been  included.  The  results of  operations  for the three and nine months
ended June 30, 1997 are not  necessarily  indicative of the results which may be
expected for the entire year.

3.  DIVIDENDS ON COMMON STOCK

On June 26,  1997 the  Company  declared  a $0.10 per  share  cash  dividend  to
shareholders of record on July 10, 1997. The dividend was paid on July 24, 1997.

4.  NEW STATEMENTS OF FINANCIAL ACCOUNTING STANDARDS

     In March 1995,  FASB issued SFAS No. 121,  Accounting for the Impairment of
Long-Lived  Assets and for  Long-Lived  Assets to be Disposed  Of,  which became
effective for the Company beginning October 1, 1996. This Statement  establishes
accounting   standards  for  the  impairment  of  long-lived   assets,   certain
identifiable  intangibles  and  goodwill  related to those assets to be held and
used and for  long-lived  assets  and  certain  identifiable  intangibles  to be
disposed  of.  The  Statement   requires  that  long-lived  assets  and  certain
identifiable  intangibles  to be held  and used by an  entity  be  reviewed  for
impairment whenever events or changes in circumstances indicate that the







                                       7
<PAGE>



carrying amount of an asset may not be recoverable. In performing the review for
recoverability,  the entity  should  estimate the future cash flows  expected to
result from the use of the asset and its eventual disposition. If the sum of the
undiscounted  cash  flows is less  than the  carrying  amount of the  asset,  an
impairment loss is recognized to reduce the carrying amount to the fair value of
the asset.  Generally,  long-lived assets and certain  identifiable  intangibles
that are to be  disposed  of should  be  reported  at the lower of the  carrying
amount or fair value less costs to sell.  The  implementation  of this Statement
did not have a material impact on the consolidated financial statements.

In October  1995,  the FASB  issued  SFAS No. 123,  Accounting  for  Stock-Based
Compensation,  which became effective for the Company beginning October 1, 1996.
SFAS No. 123 requires increased  disclosure of compensation expense arising from
both fixed and  performance  stock  compensation  plans.  Such  expense  will be
measured  as the fair  value of the  award  at the date it is  granted  using an
option-pricing  model that takes into  account the  exercise  price and expected
volatility,  expected  dividends on the stock and the expected risk-free rate of
return during the term of the option.  The compensation cost would be recognized
over the service  period,  usually the period from the grant date to the vesting
date.  SFAS No. 123 encourages,  rather than requires,  companies to adopt a new
method that accounts for stock compensation awards based on their estimated fair
value at the date they are granted.  Companies would be permitted,  however,  to
continue  accounting under  Accounting  Principles Board ("APB") Opinion No. 25.
The  Company  will  continue  to apply APB  Opinion  No.  25 in their  financial
statements  and will be required to disclose  pro forma net income and  earnings
per share in a  footnote,  determined  as if the  Company  had  applied  the new
method.

     In December  1996,  the FASB issued SFAS No. 127,  deferring  the effective
date of  certain  provisions  of SFAS No.  125,  Accounting  for  Transfers  and
Servicing of Financial Assets and  Extinguishments of Liabilities.  SFAS No. 125
will now become  effective  for the Company for  transfers of  financial  assets
occurring  after  December  31,  1997 and  servicing  of  financial  assets  and
extinguishments  of liabilities  occurring after December 31, 1996. SFAS No. 125
supersedes  SFAS No. 122,  Accounting for Mortgage  Servicing  Rights.  For each
servicing  contract in existence before January 1, 1997,  previously  recognized
servicing rights and "excess  servicing"  receivables shall be combined,  net of
any  previously  recognized  servicing  obligations  under that  contract,  as a
servicing asset or liability.  The Statement  provides that servicing assets and
other  retained  interests in  transferred  assets be measured by allocating the
previous carrying amount between the assets sold, if any, and retained interest,
if any,  based on their  relative fair values at the date of the  transfer,  and
servicing assets and liabilities be subsequently measured by (1) amortization in
proportion to and over the period of estimated net servicing income or loss, and
(2) assessment for asset impairment or increased  obligation based on their fair
values.  The  Company  does  not  anticipate  that  the  implementation  of this
Statement will have a material impact on the consolidated financial statements.

In  February  1997,  the FASB  issued  SFAS No.  128,  Earnings  per Share.  The
Statement  establishes standards for computing and presenting earnings per share
(EPS). It replaces the  presentation of primary EPS with a presentation of basic
EPS and may require additional disclosure of the EPS computation.  The Statement
is effective  for the Company's  financial  statements as of September 30, 1998.
The Company does not anticipate that the  implementation  of this Statement will
have a material impact on the  consolidated  financial  statements.  






                                       8
<PAGE>

In  February  1997,  the FASB  also  issued  SFAS No.  129,  Disclosure  of
Information about Capital  Structure.  The Statement  establishes  standards for
disclosing  information  about an entity's capital  structure.  The Statement is
effective for the Company's  financial  statements as of September 30, 1998. The
Company does not anticipate that the  implementation of this Statement will have
a material impact on the consolidated financial statements.

In June 1997,  FASB issued SFAS No. 130,  Reporting  Comprehensive  Income.  The
Statement  establishes  standards  for  reporting  and display of  comprehensive
income and its components (revenues,  expenses,  gains and losses) in a full set
of general-purpose financial statements.  This Statement requires that all items
that are required to be recognized under  accounting  standards as components of
comprehensive income be reported in a financial statement that is displayed with
the same prominence as other financial statements.  This Statement requires that
the Company (a) classify items of other comprehensive  income by their nature in
a  financial  statement  and  (b)  display  the  accumulated  balance  of  other
comprehensive  income separately from retained  earnings and additional  paid-in
capital  in the  equity  section  of a  statement  of  financial  position.  The
Statement is effective  for the Company's  financial  statements as of September
30,  1999.  The Company  does not  anticipate  that the  implementation  of this
Statement will have a material impact on the consolidated financial statements.

     In June 1997,  FASB issued SFAS No. 131,  Disclosures  about Segments of an
Enterprise and Related Information.  The Statement establishes standards for the
way that public business enterprises report information about operating segments
in annual  financial  statements  and  requires  that those  enterprises  report
selected  information  about  operating  segments in interim  financial  reports
issued to shareholders.  It also establishes  standards for related  disclosures
about  products  and  services,  geographic  areas,  and  major  customers.  The
Statement is effective  for the Company's  financial  statements as of September
30,  1999.  The Company  does not  anticipate  that the  implementation  of this
Statement will have a material impact on the consolidated financial statements.











                                       9



<PAGE>
5.  LOANS RECEIVABLE
<TABLE>
<CAPTION>
                                                                               September 30,              June 30,
                                                                                   1996                     1997
                                                                                                         (Unaudited)
                                                                        ---------------------------------------------------
                                                                                       (Dollars in Thousands)
<S>                                                                                     <C>                    <C>       
First mortgage loans:
Residential-one-to-four units                                                             $157,494               $197,510
Secured by other properties                                                                  1,013                    909
Construction loans                                                                          17,367                 18,489
                                                                        ---------------------------------------------------
                                                                                           175,874                216,908
                                                                        ---------------------------------------------------
Other installment loans:
Property improvement, auto and other                                                         5,195                  6,104
Mobile home                                                                                    305                    171
Deposits                                                                                       769                    821
                                                                        ---------------------------------------------------
                                                                                             6,269                  7,096
                                                                        ---------------------------------------------------
Less:
   Unearned discounts and loan fees                                                            157                  (220)
   Undisbursed loan funds                                                                   10,407                 10,603
   Allowance for loan losses                                                                   421                    427
                                                                        ---------------------------------------------------
                                                                                          $171,158               $213,194
                                                                        ===================================================
</TABLE>

The Bank  services  loans for others which are not included in the  accompanying
consolidated  balance sheets. The approximate unpaid principal balances of these
loans are summarized as follows:
<TABLE>
<CAPTION>
                                                                               September 30,              June 30,
                                                                                    1996                    1997
                                                                                                         (Unaudited)
                                                                        ---------------------------------------------------
                                                                                     (Dollars in Thousands)

<S>                                                                                     <C>                    <C>     
Government National Mortgage Association                                                  $875,381               $864,405
Federal National Mortgage Association                                                      115,492                107,514
Federal Home Loan Mortgage Corporation                                                     231,515                303,049
Other Investors                                                                              6,765                  3,050
                                                                        ---------------------------------------------------
                                                                                        $1,229,153             $1,278,018
                                                                        ===================================================

</TABLE>
6.  MORTGAGE SERVICING RIGHTS (MSR)

Following is an analysis of the changes in mortgage servicing rights:
<TABLE>
<CAPTION>
                                                                                        Nine Months Ended
                                                                                              June 30,
                                                                                            (Unaudited)
                                                                                     1996                    1997
                                                                          --------------------------------------------------
                                                                                       (Dollars in Thousands)

<S>                                                                                         <C>                     <C>    
Balance, Beginning of period                                                                $11,625                 $12,496
Additions                                                                                     1,878                   2,048
Amortization                                                                                 (1,273)                 (1,303)
                                                                          ---------------------------------------------------
                                                                                             12,230                  13,241
Allowance for loss                                                                            - 0 -                       8
                                                                          ---------------------------------------------------
Balance, End of period                                                                      $12,230                 $13,233
                                                                          ===================================================

</TABLE>
                                       10

<PAGE>


7.  CONTINGENCIES

LEGAL PROCEEDINGS
-----------------
Supreme  Court  Ruling on Breach of  Contract  Regarding  Supervisory  Goodwill:
Mid-Continent Federal Savings Bank, the wholly-owned subsidiary of Mid Continent
Bancshares,  Inc.,  is pursuing  its claim  against the  federal  government  to
recover funds lost as a result of the  enactment of the  Financial  Institutions
Reform, Recovery, and Enforcement Act of 1989 ("FIRREA").  In 1986, the Bank was
encouraged by the federal  government to acquire an insolvent thrift institution
("Reserve Savings and Loan  Association").  The federal  government  allowed the
Bank to  count  the  insolvent  thrift's  losses  as  "goodwill"  assets  and to
double-count as "capital  credit" federal  government funds provided to help the
Bank take over the failing thrift. The Bank contends (among other things) in its
lawsuit that the federal  government  breached  its contract  with the Bank when
FIRREA was enacted  because FIRREA  prevented the Bank from counting such assets
toward minimum capital requirements.  As a result of FIRREA, the Bank was forced
to write off approximately  $7,500,000 in supervisory  goodwill.  This write off
reduced the Bank's regulatory capital.

On July 1, 1996, the United States Supreme Court affirmed decisions by a federal
appellate  court that the government had breached  express  contracts with three
thrifts  (U.S.  v. Winstar  Corp.  et al.) and therefore was liable for damages.
Those lawsuits stemmed from circumstances that are similar to those of the Bank;
in  order  to  persuade  those  thrifts  to  acquire  certain  insolvent  thrift
institutions,  the federal government promised  accounting  treatment similar to
that promised to the Bank.

While the Supreme  Court's  ruling in U.S. v. Winstar  Corp.  et al.,  serves to
support  the Bank's  legal  claims in its  pending  lawsuit  against the federal
government,  it is not  possible at this time to predict what effect the Supreme
Court's ruling, and subsequent rulings of a lower court concerning damages, will
have on the outcome of the Bank's lawsuit.  Notwithstanding  the Supreme Court's
ruling,  there can be no  assurance  that the Bank will be able to  recover  any
funds arising out of its claim and, if any recovery is made,  the amount of such
recovery.




                                       11




<PAGE>



                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                           OF FINANCIAL CONDITION AND
                              RESULTS OF OPERATIONS

GENERAL

Mid  Continent  Bancshares,  Inc.  is a  Kansas  corporation  organized  in
January,  1994. The Holding  Company is engaged in the business of directing and
planning the  activities of  Mid-Continent  Federal  Savings  Bank,  the holding
company's primary asset.

Mid-Continent  Federal  Savings Bank is engaged  principally  in the business of
attracting  deposits from the general public and using such  deposits,  together
with other borrowed funds, to originate permanent and construction loans secured
by one-to-four  family  residential real estate, to make permitted  investments,
including  mortgage-backed and mortgage-related  securities,  and to acquire the
rights to perform loan servicing functions for others.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity Resources:

The Bank's primary sources of funds are deposits, advances from the Federal Home
Loan  Bank  and  proceeds  from  principal  and  interest   payments  on  loans,
mortgage-related  securities and  investment  securities.  While  maturities and
scheduled   amortization  of  loans  and   mortgage-related   securities  are  a
predictable source of funds,  deposit flows and mortgage prepayments are greatly
influenced by general  interest  rates,  economic  conditions  and  competition.
Dependent on the current economic conditions, the bank receives additional funds
through   unscheduled   prepayments  of  mortgage  loans  and   mortgage-related
securities.

The  Office of Thrift  Supervision  (OTS)  requires  a  savings  institution  to
maintain  an  average   daily  balance  of  liquid  assets  (cash  and  eligible
investments)  equal to at  least  5% of the  average  daily  balance  of its net
withdrawable  deposits and  short-term  borrowings.  In  additional,  short-term
liquid  assets  currently  must  constitute  1% of the  sum of net  withdrawable
deposit accounts plus short-term borrowings.  The Bank's actual liquidity ratios
were 9.1% and 10.9% as of September  30, 1996 and June 30,  1997,  respectively.
The Bank's short-term liquidity ratio was 3.7% and 6.6%, respectively.

Managing the Bank's liquidity levels is a daily and a long-term function of
the Bank and its Asset Liability Committee. Cash flows are monitored by the Bank
on a regular  basis.  Cash flow  planning  is  utilized  to  enhance  the Bank's
earnings where possible.  Management  believes that the Bank has access to ample
funds to meet any unforeseen liquidity needs of the near future.



                                       12


<PAGE>


Capital Resources:

As required under the Financial Institution Reform, Recovery and Enforcement Act
(FIRREA)  the Bank is required to maintain  specific  amounts of capital.  As of
June  30,  1997,  the  Bank  was  in  compliance  with  all  regulatory  capital
requirements.  Capital includes tangible,  core and risk-based capital ratios of
8.5%, 8.5% and 22.6%, respectively.

The Bank's capital  requirements and actual capital under OTS regulations are as
follows as of June 30, 1997:


                                                      AMOUNT       RATIO
                                                  (in thousands)
GAAP CAPITAL                                         $35,072
                                                     =======

TANGIBLE CAPITAL:
     ACTUAL                                          $35,072         8.5%
     REQUIRED                                          6,173         1.5%
                                                     -------         ---- 
     EXCESS                                          $28,899         7.0%
                                                     =======         ==== 

CORE CAPITAL:
     ACTUAL                                          $35,072         8.5%
     REQUIRED                                         12,346         3.0%
                                                     -------         ----
     EXCESS                                          $22,726         5.5%
                                                     =======         ==== 

RISK-BASED CAPITAL:
     ACTUAL                                          $35,499        22.6%
     REQUIRED                                         12,568         8.0%
                                                     -------        -----
     EXCESS                                          $22,931        14.6%
                                                     =======        ===== 



                                       13




<PAGE>


                              RESULTS OF OPERATIONS
                    THREE MONTHS ENDED JUNE 30, 1997 AND 1996
                             (Dollars in Thousands)

GENERAL - The  Company's net income for the three months ended June 30, 1997 was
$1,127 compared with $895 the three months ended June 30, 1996.

NET INTEREST INCOME - The Company's net interest  income is primarily  dependent
upon  the  difference  or  "spread"  between  the  yield  earned  on  loans  and
investments  and  the  rate  paid on  deposits  and  borrowings,  as well as the
relative  amounts of such assets and  liabilities.  The interest  rate spread is
affected by regulatory, economic and competitive factors that influence interest
rates,  loan  demand  and  deposit  flows.  The  Company,   like  other  savings
institution  holding  companies,  is subject to interest rate risk to the degree
that its  interest-bearing  liabilities mature or reprice at different times, or
on a different basis, than its interest-earning assets.

Net  interest  income for the three month period ended June 30, 1997 was $2,378,
representing  a 16.7%  increase from the three month period ended June 30, 1996.
Interest-bearing assets and liabilities increased from June 30, 1996 to June 30,
1997.   (Interest-bearing   assets  increased  by  $91,939,   or  31.8%,   while
interest-bearing  liabilities  increased by $91,397,  or 33.6%.) Total  interest
income increased by 31.1% to $6,672,  while interest expense  increased 40.7% to
$4,294.

INTEREST  INCOME - Interest  income for the three months ended June 30, 1997 was
$6,672  compared  with  $5,089  for  the  three  months  ended  June  30,  1996,
representing an increase of $1,583 or 31.1%.

The Bank's interest on loans receivable increased $1,172 during the three months
ended June 30,  1997 over the same  period in 1996.  This  increase  reflects an
increase in loans  receivable,  comprised  primarily of  adjustable  rate loans.
Loans held for investment  purposes at June 30, 1997 was  approximately  $68,233
greater than such loans at June 30, 1996.

Interest on mortgage-related  securities decreased $93. The Bank's investment in
mortgage-related securities declined in the quarter ended June 30, 1997.

Income from the investment  portfolio,  FHLB stock and cash and cash equivalents
increased $504. The improvement is due to an increase in investment  securities,
FHLB stock and interest-earning  cash of $24,715,  from $89,012 at June 30, 1996
to $113,727 at June 30, 1997.

INTEREST EXPENSE - Interest expense for the three months ended June 30, 1997 was
$4,294  compared  with  $3,051  for  the  three  months  ended  June  30,  1996,
representing an increase of $1,243 or 40.7%. The increased  interest expense for
the period was the result of growth in the deposits of $31,797, from $215,213 at
June 30, 1996 to $247,010 at June 30, 1997,  as well as an  increased  amount of
borrowings  of  $59,600,  from  $56,500 at June 30, 1996 to $116,100 at June 30,
1997.



                                       14




<PAGE>




PROVISION FOR LOANS LOSSES - The Bank currently  maintains an allowance for loan
losses based upon management's  periodic  evaluation of known and inherent risks
in the loan portfolio, the Bank's past loss experience,  adverse situations that
may  affect  the  borrowers'  ability  to repay  loans,  estimated  value of the
underlying  collateral and current and expected  market  conditions.  During the
three months  ended June 30, 1997 and 1996,  respectively,  the Bank  recorded a
provision for loans losses of $76 and $30.

OTHER  INCOME - Other  income for the three month period ended June 30, 1997 was
$1,894  compared  with  $1,755  for  the  three  months  ended  June  30,  1996,
representing an increase of $139.

At June 30, 1997,  the Bank was servicing  approximately  $1,278,018 of mortgage
loans  for  others.  At June 30,  1996,  the Bank  was  servicing  approximately
$1,219,386 of mortgage loans for others.  The Bank's total  servicing  portfolio
for others increased $58,632, or 4.8%. Net loan servicing fees increased $1 from
$777 for the quarter  ended June 30, 1996 to $778 for the quarter ended June 30,
1997.  Gross  loan  servicing  fees  increased  $29,  and  amortization  of loan
servicing rights increased $28.

Revenue from service fees and other charges to customers  increased  $187,  from
$618 for the quarter  ended June 30, 1996 to $805 for the quarter ended June 30,
1997. Gains on sale of loans decreased $19, from $277 for the quarter ended June
30, 1996 to $258 for the quarter ended June 30, 1997.

A primary  source of the increase in service  fees from  customers is the Bank's
checking  account  programs.  The number of  checking  accounts  increased  from
approximately  15,500 at June 30, 1996 to approximately 18,000 at June 30, 1997.
In addition to  enhancing  service fee income,  the  checking  account  programs
provide a source of low-cost deposits for the Bank.

Loans held for sale increased $1,278, or 9.2%, to $15,147 at June 30, 1997,
compared  to $13,869 at June 30,  1996.  Sales of loans held for sale  decreased
$9,471,  or 16.0%,  from $59,103 for the quarter  ended June 30, 1996 to $49,632
for the quarter ended June 30, 1997.  Gain on the sale of loans  decreased  from
$277 for the quarter  ended June 30, 1996 to $258 for the quarter ended June 30,
1997.  Although  the  Company  reduces  the  level of market  risk by  obtaining
commitments to sell loans at fixed prices, it cannot eliminate all such risks.

OTHER EXPENSE - Other  expenses for the three months ended June 30, 1997 totaled
$2,319  compared  to $2,299  for the three  months  ended June 30,  1996.  Other
expenses  consisted of compensation  related expenses,  building and maintenance
expenses,  federal insurance premiums, audit and OTS examination fees, and other
general and administrative expenses.

Salaries  and  employee  benefits  decreased  from  $1,201 in the June 30,  1996
quarter to $1,174 in the June 30, 1997 quarter.

Office occupancy,  supplies and data processing expenses collectively  increased
$79 in the June 30,  1997  quarter  compared to the June 30,  1996  quarter.  In
addition to general  increases in costs



                                       15



<PAGE>



of  services,  the June 30, 1997  quarter  includes  the costs of nine full
service  branches  in 1997,  compared  to seven in 1996.  The Bank's  tenth full
service branch was opened in June, 1997.

Federal insurance  premiums  decreased $74, from $111 for the quarter ended June
30, 1996 to $37 for the quarter ended June 30, 1997.

Loan servicing  expenses decreased from $101 for the quarter ended June 30, 1996
to $68 for the quarter ended June 30, 1997. Loan servicing expenses are incurred
for  custodial  fees  for  loan  documents,   additional  loan  payoff  interest
associated with GNMA pooled mortgages and other miscellaneous  servicing related
expenses.

     INCOME  TAXES - Income tax expense for the three months ended June 30, 1997
was $750 which represents an effective tax rate of 40.0%. Income tax expense for
the three months ended June 30, 1996 was $569 which  represents an effective tax
rate of 38.9%.



                                       16




<PAGE>



                              RESULTS OF OPERATIONS
                    NINE MONTHS ENDED JUNE 30, 1997 AND 1996
                             (Dollars in Thousands)

GENERAL - The  Company's  net income for the nine months ended June 30, 1997 was
$3,193 compared with $2,666 for the nine months ended June 30, 1996.

NET INTEREST INCOME - The Company's net interest  income is primarily  dependent
upon  the  difference  or  "spread"  between  the  yield  earned  on  loans  and
investments  and  the  rate  paid on  deposits  and  borrowings,  as well as the
relative  amounts of such assets and  liabilities.  The interest  rate spread is
affected by regulatory, economic and competitive factors that influence interest
rates,  loan  demand  and  deposit  flows.  The  Company,   like  other  savings
institution  holding  companies,  is subject to interest rate risk to the degree
that its  interest-bearing  liabilities mature or reprice at different times, or
on a different basis, than its interest-earnings assets.

Net  interest  income for the nine month  period ended June 30, 1997 was $6,681,
representing  a 16.2%  increase  from the nine month period ended June 30, 1996.
Interest-bearing assets and liabilities increased from June 30, 1996 to June 30,
1997.   (Interest-bearing   assets  increased  by  $91,939,   or  31.8%,   while
interest-bearing  liabilities  increased by $91,397,  or 33.6%.) Total  interest
income increased by 30.5% to $18,958 while interest  expense  increased 40.0% to
$12,277.

INTEREST  INCOME - Interest  income for the nine months  ended June 30, 1997 was
$18,958  compared  with  $14,522  for the  nine  months  ended  June  30,  1996,
representing an increase of $4,436 or 30.5%.

The Bank's interest on loans receivable  increased $3,005 during the nine months
ended June 30,  1997 over the same  period in 1996.  This  increase  reflects an
increase in loans  receivable,  comprised  primarily of  adjustable  rate loans.
Loans held for investment  purposes at June 30, 1997 was  approximately  $68,233
greater than such loans at June 30, 1996.

Interest on mortgage-related securities decreased $289. The Bank's investment in
mortgage-related securities declined in the nine months ended June 30, 1997.

Income from the investment  portfolio,  FHLB stock and cash and cash equivalents
increased  $1,720.   The  improvement  is  due  to  an  increase  in  investment
securities,  FHLB stock and  interest-earning  cash of $24,715,  from $89,012 at
June 30, 1996 to $113,727 at June 30, 1997.

INTEREST  EXPENSE - Interest expense for the nine months ended June 30, 1997 was
$12,277  compared  with  $8,770  for  the  nine  months  ended  June  30,  1996,
representing an increase of $3,507 or 40.0%. The increased  interest expense for
the period was the result of growth in the deposits of $31,797, from $215,213 at
June 30, 1996 to $247,010 at June 30, 1997,  as well as an  increased  amount of
borrowings  of  $59,600,  from  $56,500 at June 30, 1996 to $116,100 at June 30,
1997.



                                       17
<PAGE>

PROVISION FOR LOAN LOSSES - The Bank currently maintains an allowance for
loan losses based upon  management's  periodic  evaluation of known and inherent
risks in the loan portfolio, the Bank's past loss experience, adverse situations
that may affect the borrowers'  ability to repay loans,  estimated  value of the
underlying  collateral and current and expected  market  conditions.  During the
nine months  ended June 30,  1997 and 1996,  respectively,  the Bank  recorded a
provision for loan losses of $101 and $23.

OTHER  INCOME - Other  income for the nine month  period ended June 30, 1997 was
$5,452   compared  with  $5,344  for  the  nine  months  ended  June  30,  1996,
representing an increase of $108.

At June 30, 1997,  the Bank was servicing  approximately  $1,278,018 of mortgage
loans  for  others.  At June 30,  1996,  the Bank  was  servicing  approximately
$1,219,386 of mortgage loans for others.  The Bank's total  servicing  portfolio
for others  increased  $58,632,  or 4.8%.  Net loan servicing fees decreased $7,
from  $2,323  for the nine  months  ended  June 30,  1996 to $2,316 for the nine
months  ended  June 30,  1997.  Gross  loan  servicing  fees  increased  $23 and
amortization of loan servicing rights increased $30.

Revenue  from service fees and other  charges to customers  increased  $347 from
$1,868 for the nine  months  ended June 30,  1996 to $2,215 for the nine  months
ended June 30, 1997.

Loans held for sale  increased  $1,278,  or 9.2%,  to $15,147 at June 30,  1997,
compared  to $13,869 at June 30,  1996.  Sales of loans held for sale  decreased
$3,250,  or 2.1%  from  $157,934  for the nine  months  ended  June 30,  1996 to
$154,684  for the nine  months  ended June 30,  1997.  Gain on the sale of loans
decreased  from $1,020 for the nine  months  ended June 30, 1996 to $774 for the
nine months  ended June 30,  1997.  Although  the  Company  reduces the level of
market risk by obtaining  commitments  to sell loans at fixed prices,  it cannot
eliminate all such risks.

OTHER  EXPENSE - Other  expenses for the nine months ended June 30, 1997 totaled
$6,813  compared  to $6,816  for the nine  months  ended  June 30,  1996.  Other
expenses  consisted of compensation  related expenses,  building and maintenance
expenses,  federal insurance premiums, audit and OTS examination fees, and other
general and administrative expenses.

Salaries and employee  benefits  decreased from $3,483 for the nine months ended
June 30, 1996 to $3,437 for the nine months ended June 30, 1997.

Office occupancy,  supplies and data processing expenses collectively  increased
$187 in the nine months  ended June 30, 1997  compared to the nine months  ended
June 30,  1996.  In addition to general  increases in costs of services the nine
months ended June 30, 1997  includes the costs of nine full service  branches in
1997, compared to seven in 1996. The Bank's tenth full service branch was opened
in June, 1997.

Federal insurance  premiums  decreased $164, from $332 for the nine months ended
June 30, 1996 to $168 for the nine months ended June 30, 1997.


                                       18
<PAGE>

Loan servicing  expenses  decreased from $257 for the nine months ended June 30,
1996 to $193 for the nine months ended June 30, 1997.  Loan  servicing  expenses
are incurred  for  custodial  fees for loan  documents,  additional  loan payoff
interest associated with GNMA pooled mortgages and other miscellaneous servicing
related expenses.

INCOME  TAXES - Income tax expense  for the nine months  ended June 30, 1997 was
$2,026 which  represents an effective tax rate of 38.8%.  Income tax expense for
the nine months ended June 30, 1996 was $1,591 which represents an effective tax
rate of 37.4%.



                                      19




<PAGE>



                         MID CONTINENT BANCSHARES, INC.

PART II

Item 1.       Legal Proceedings

              The Company has no material proceedings pending against it.

Item 2.       Changes in Securities

              None.

Item 3.       Defaults upon Senior Securities

              None.

Item 4.       Submission of Matters to a Vote of Security Holders

              None.

Item 5.       Other information

              None.

Item 6.       Exhibits and Reports on Form 8-K

              None.



                                       20




<PAGE>



                                   SIGNATURES


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                    Mid Continent Bancshares, Inc.
                                    ------------------------------



August 13, 1997                     /s/  Richard T. Pottorff
---------------------               ------------------------------
Date                                Richard T. Pottorff
                                    President
                                    Chief Executive Officer


August 13, 1997                     /s/  Larry R. Goddard
----------------------              ------------------------------
Date                                Larry R. Goddard
                                    Executive Vice President
                                    Chief Financial Officer




                                       21