SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB
                                   (Mark One)

[X]  Annual report  pursuant to section 13 or 15(d) of the  Securities  Exchange
     Act of 1934 (No Fee required)

     For  the fiscal year ended March 31, 1997
                                --------------

[    ]  Transition  report  pursuant  to section  13 or 15(d) of the  Securities
     Exchange  Act  of  1934  (No  fee  required)  For  the  transition   period
     from              to              .
          ------------    ------------

Commission File No. 0-22535

                           Sistersville Bancorp, Inc.
                 ----------------------------------------------
                 (Name of Small Business Issuer in Its Charter)

Delaware 
---------------------------------------------             ---------------
(State or Other Jurisdiction of Incorporation             I.R.S. Employer
or Organization)                                         Identification No.

726 Wells Street, Sistersville, West Virginia                  26175
---------------------------------------------               ----------
(Address of Principal Executive Offices                     (Zip Code)

Issuer's Telephone Number, Including Area Code:           (304) 652-3671
                                                          --------------

Securities registered under to Section 12(b) of the Exchange Act:      None
                                                                      ------

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

                     Common Stock, par value $0.10 per share
                     ---------------------------------------
                                (Title of Class)

     Check whether the issuer: (1) has filed all reports required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing  requirements  for the past 90 days.  
YES      NO  X .
    ---     ---

     Check if there is no disclosure  of  delinquent  filers in response to Item
405 of  Regulation  S-B  contained  in  this  form,  and no  disclosure  will be
contained,  to the  best of  registrant's  knowledge,  in  definitive  proxy  or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [X]

     State issuer's revenues for its most recent fiscal year. $2,040,961

     The aggregate  market value of the voting stock held by  non-affiliates  of
the registrant, based on the last sale price of the registrant's Common Stock on
July 28, 1997 ($14.25 per share), was approximately $8.1 million.

     As of July 29, 1997,  there were issued and  outstanding  661,428 shares of
the registrant's Common Stock.

     Transition Small Business Disclosure Format (check one):
YES      NO  X
    ---     ---
                       DOCUMENTS INCORPORATED BY REFERENCE
                                      NONE


<PAGE>



                              EXPLANATION OF FILING

General

         The  Registrant's  Registration  Statement on Form S-1 and accompanying
Registration  Statement on Form 8-A, as filed with the  Securities  and Exchange
Commission in connection with the Registrant's  initial public offering,  became
effective on May 12, 1997, which was within 90 days of the  Registrant's  fiscal
year end of March 31, 1997.  Because the Registration  Statement on Form S-1 did
not contain  audited  financial  statements  for the fiscal year just  completed
(March 31, 1997),  the Registrant is required by Rule 15d-2 under the Securities
Exchange Act of 1934, as amended, to file a Special Report on Form 10-KSB within
90 days of the  Effective  Date of the  Registration  Statement on Form S-1. The
Registrant's  Special  Report on Form 10-KSB is required to contain only audited
financial  statements  for the just  completed  fiscal  year,  unless  otherwise
required by the rules of any  exchange.  The  Registrant's  Common  Stock is not
traded  on  any  exchange  or on  the  NASDAQ  Stock  Market.  Accordingly,  the
Registrant's  Special Report on Form 10-KSB does not include any other narrative
items or  tabular  information  which are  normally  required  to be filed in an
Annual Report on Form 10- KSB.

         The  Registrant's  initial public  offering was consummated on June 25,
1997,  at which time the  Registrant's  wholly-owned  subsidiary,  First Federal
Savings  Bank,   formerly  First  Federal   Savings  and  Loan   Association  of
Sistersville (the "Association"), completed it conversion from the mutual to the
stock  form of  organization  (the  "Conversion").  Accordingly,  the  financial
statements  filed  with  this  Special  Report on Form  10-KSB  are those of the
Association  as it existed in the mutual  form of  organization  as of March 31,
1997,  and do not  reflect  the receipt of the  proceeds  from the  Registrant's
initial public offering or the completion of the Conversion.


Item 7.  Financial Statements
-----------------------------

         The Association's  financial  statements are filed herewith.  See "Item
13. Exhibits, List and Reports on Form 8-K."


Item 13.  Exhibits, List and Reports on Form 8-K
------------------------------------------------

         (a)      The following documents are filed as a part of this report:

                  1. The following  financial  statements of the Association and
the report of independent  accountants  of the Registrant  included under Item 7
are incorporated herein by reference.



                                        1

<PAGE>



         Independent Auditors Report

         Statements of Financial Condition at March 31, 1997 and 1996.

         Statements of Operations  for the Years Ended March 31, 1997,  1996 and
1995.

         Statements  of Changes in Equity for the Years  Ended  March 31,  1997,
1996 and 1995.

         Statements  of Cash Flows for the Years Ended March 31, 1997,  1996 and
1995.

         Notes to Financial Statements.

                  2. Financial  Statement  Schedules for which provision is made
in the applicable  accounting  regulations of the SEC are not required under the
related instructions or are inapplicable and therefore have been omitted.

                  3.       The following exhibits are included in this Report:

                  (a)      List of Exhibits:

                  27       Financial Data Schedule

                  (b)      Reports on Form 8-K.

                  None.


                                        2

<PAGE>
SNODGRASS
Certified Public Accountants
[LOGO]

                          Independent Auditor's Report
                          ----------------------------


Board of Directors
First Federal Savings and Loan
Association of Sistersville

We have audited the  accompanying  statements  of  financial  condition of First
Federal  Savings and Loan  Association of  Sistersville as of March 31, 1997 and
1996,  and the related  statements of  operations,  changes in equity,  and cash
flows for the three years ended March 31, 1997.  These financial  statements are
the  responsibility of the Association's  management.  Our  responsibility is to
express an opinion on these financial statements based on our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of First Federal Savings and Loan
Association of  Sistersville  at March 31, 1997 and 1996, and the results of its
operations,  changes in  retained  earnings  and cash flows for the three  years
ended  March  31,  1997,  in  conformity  with  generally  accepted   accounting
principles.

As discussed in Note 1, the  Association  changed its method of  accounting  for
debt and equity securities in 1995.


/s/S,R,Snodgrass, A.C.
Wheeling, West Virginia
June 26, 1997.

S.R. Snodgrass, A.C.
980 National Road Wheeling, WV 26003-6400 
Phone: 304-233-5030 Facsimile: 304-233-3062

<PAGE>

           First Federal Savings and Loan Association of Sistersville
                        STATEMENTS OF FINANCIAL CONDITION
<TABLE>
<CAPTION>
                                                                                            March 31,
                                                                                        1997             1996             
                                                                               ------------------ ---------------         
ASSETS
<S>                                                                            <C>                <C>            
Cash (including interest bearing short-term
 deposits of $1,713,394 at 3/31/97; and
 $2,326,463 at 3/31/96)                                                        $      1,794,459   $     2,424,571
Investment securities:
   Available for sale (at market value)                                               2,319,633         2,134,589
   Held to maturity (market value - $335,053 at
     3/31/97; and $784,267 at 3/31/96)                                                  328,053           775,025
Loans receivable, net                                                                21,724,869        20,038,692
Real estate acquired in settlement of loans,
 net of allowance of $ -0-                                                                  -              28,646
Office properties and equipment, at cost, less
 accumulated depreciation of $254,037 at 3/31/97;
 and $214,235 at 3/31/96                                                                363,538           400,714
Accrued interest receivable - investments                                                14,750            16,333
Accrued interest receivable - loans (net of reserve
 for uncollected interest of $6,412 at 3/31/97 and
 $-0- at 3/31/96)                                                                       129,321           123,028
Prepaid expenses and other assets                                                       142,127            25,028
                                                                               ----------------   ---------------

          TOTAL ASSETS                                                         $     26,816,750   $    25,966,626
                                                                               ================   ===============

                                                 LIABILITIES AND EQUITY

NOW and Money Market withdrawal accounts                                       $      2,912,286   $     2,699,712
Savings accounts                                                                     18,787,439        18,391,103
                                                                               ----------------    --------------
          Total deposits                                                             21,699,725        21,090,815
Accrued interest payable on savings                                                      12,379            14,420
Accrued compensation                                                                      7,368             4,780
Accrued federal income taxes                                                             30,365            60,833
Deferred federal taxes                                                                  215,091           176,806
Other liabilities                                                                        48,508            71,291
                                                                               ----------------   ---------------
          Total liabilities                                                          22,013,436        21,418,945
                                                                               ----------------   ---------------

Commitments and contingencies (Note 10)                                                     -                 -

Retained earnings-substantially restricted                                            4,410,275         4,262,801
Unrealized gain on securities available for sale,
 net of applicable deferred income taxes                                                393,039           284,880
                                                                               ----------------   ---------------
          Total equity                                                                4,803,314         4,547,681
                                                                               ----------------   ---------------

          TOTAL LIABILITIES AND EQUITY                                         $     26,816,750   $    25,966,626
                                                                               ================   ===============
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                                       -4-

<PAGE>

           First Federal Savings and Loan Association of Sistersville
                            STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                                                  Year Ended March 31,
                                                                        -----------------------------------------
                                                                              1997           1996          1995
                                                                        ------------   ------------  ------------
<S>                                                                     <C>            <C>           <C>         
INTEREST AND DIVIDEND INCOME
    Taxable Interest on loans                                           $  1,804,726   $  1,662,025  $  1,434,749
    Taxable interest on investments                                          216,403        293,413       429,320
    Dividends on FHLB stock                                                   11,602         10,613         8,163
    Dividends on FHLMC stock                                                   8,230          7,095         6,130
                                                                        ------------   ------------  ------------
        Total interest and dividend income                                 2,040,961      1,973,146     1,878,362
                                                                        ------------   ------------  ------------

INTEREST EXPENSE
    Interest on deposits                                                     979,537        955,554       818,648
    Borrowed funds                                                               -           21,182        21,898
                                                                        ------------   ------------  ------------
        Total interest expense                                               979,537        976,736       840,546
                                                                        ------------   ------------  ------------

        Net interest income                                                1,061,424        996,410     1,037,816

PROVISION FOR LOAN LOSSES                                                      7,733          6,800        27,900
                                                                        ------------   ------------  ------------

        Net interest income after provision
         for loan losses                                                   1,053,691        989,610     1,009,916
                                                                        ------------   ------------  ------------

NON-INTEREST INCOME
    Service charges                                                           20,965         19,993        18,075
    Gain on sale of real estate, net                                           3,974            -           4,114
    Other income                                                               1,978          3,876         3,905
                                                                        ------------   ------------  ------------
        Total non-interest income                                             26,917         23,869        26,094
                                                                        ------------   ------------  ------------

NON-INTEREST EXPENSES General and administrative expenses:
      Salaries and benefits                                                  413,763        392,987       376,673
      Occupancy expense                                                       40,205         28,239        22,728
      Furniture and equipment expense                                         34,342         25,245        19,713
      Service bureau expense                                                  58,390         54,307        55,292
      Advertising and public relations                                        22,385         21,114        23,817
      Supervisory examination, audit and legal                                24,383         23,452        19,766
      Federal insurance premium                                              166,722         46,171        45,246
      Franchise, payroll, and other taxes                                     49,570         48,363        48,831
      Net realized losses on sales of
       available-for-sale securities                                             -            8,340           -
      Other operating expenses                                                60,229         54,826        68,143
                                                                        ------------   ------------  ------------
        Total non-interest expenses                                          869,989        703,044       680,209
                                                                        ------------   ------------  ------------

        Income before income taxes                                           210,619        310,435       355,801

PROVISION FOR FEDERAL INCOME TAXES                                            63,145        113,198       125,604
                                                                        ------------   ------------  ------------

        Net income                                                      $    147,474   $    197,237  $    230,197
                                                                        ============   ============  ============

</TABLE>

    The accompanying notes are an integral part of the financial statements.

                                       -5-

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                         STATEMENTS OF CHANGES IN EQUITY

<TABLE>
<CAPTION>
                                                                              Net Unrealized
                                                                               Gain (Loss)
                                                                              on Securities
                                                              Retained        Available for
                                                              Earnings            Sale                Total
                                                          ----------------   -----------------   ----------------

<S>                                                       <C>                 <C>                <C>            
Balance, March 31, 1994                                   $      3,835,367    $            -     $     3,835,367

Effect of adopting FAS No. 115                                         -               175,474           175,474

Net income for the year ended
 March 31, 1995                                                    230,197                 -             230,197

Change in fair value of securities
 available for sale                                                    -                36,029            36,029
                                                          ----------------    ----------------   ---------------

Balance, March 31, 1995                                          4,065,564             211,503         4,277,067

Net income for the year ended
  March 31, 1996                                                   197,237                 -             197,237

Change in fair value of securities
  available for sale                                                   -                73,377            73,377
                                                          ----------------    ----------------   ---------------

Balance, March 31, 1996                                          4,262,801             284,880         4,547,681

Net income for the year ended
 March 31, 1997                                                    147,474                   -           147,474

Change in fair value of securities
  available for sale                                                   -               108,159           108,159
                                                          ----------------    ----------------   ---------------

Balance, March 31, 1997                                   $      4,410,275    $        393,039   $     4,803,314
                                                          ================    ================   ===============

</TABLE>


     The accompanying notes are an integral part of the financial statements.

                                       -6-

<PAGE>

           First Federal Savings and Loan Association of Sistersville
                            STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                                          Year Ended March 31,
                                                               -----------------------------------------
                                                                    1997         1996           1995
                                                               ------------  -----------   -------------
<S>                                                            <C>            <C>            <C>        
CASH FLOWS FROM OPERATING ACTIVITIES
    Net income                                                 $   147,474    $   197,237    $   230,197
    Adjustments to reconcile net income to net
     cash provided by operating activities:
       Depreciation                                                 39,802         26,491         18,404
       Deferred federal income taxes                               (17,436)       (20,004)        20,019
       Provision for loan losses                                     7,733          6,800         27,900
       Net amortization/accretion of investment
        security premiums and discounts                             (2,962)        (4,490)         1,511
       Gain on sale of real estate owned                            (3,974)          --           (4,114)
       Loss on sale of investment securities                          --            8,340           --
       Accrued interest receivable                                  (4,710)        40,315        (29,212)
       Prepaid income taxes                                           --             --           35,388
       Accrued federal income taxes                                (30,468)         2,607         26,330
       Prepaid expenses and other assets                          (117,099)        10,387        (11,759)
       Accrued interest payable on savings                          (2,041)         1,070         (1,098)
       Other liabilities and accrued expenses                      (20,195)        25,038        (31,693)
                                                               -----------    -----------    -----------
        Net cash provided by (used in) operating activities         (3,876)       293,791        281,873
                                                               -----------    -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES
       Proceeds from maturity of U.S. Government obligations       400,000      2,800,000      1,200,000
       Proceeds from available-for-sale securities                    --        1,991,250           --
       Purchase of Federal Home Loan Bank stock                    (20,300)       (23,900)       (28,000)
       Purchase of U.S. Government obligations                        --             --       (1,984,688)
       Principal payments on mortgage-backed loans                  49,070         60,115         64,952
       Net increase in loans                                    (1,693,910)    (2,359,243)    (3,509,515)
       Acquisition of office properties and equipment               (2,626)      (249,788)       (63,289)
        Disposition of real estate owned                            32,620           --           18,377
                                                               -----------    -----------    -----------
        Net cash provided by (used in) investing activities     (1,235,146)     2,218,434     (4,302,163)
                                                               -----------    -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES
       Net increase in customer deposit accounts                   608,910      1,280,390         13,272
       Net increase (decrease) in borrowed funds                      --       (1,685,000)     1,685,000
                                                               -----------    -----------    -----------
        Net cash provided by (used in) financing activities        608,910       (404,610)     1,698,272
                                                               -----------    -----------    -----------

        Increase (decrease) in cash and cash equivalents          (630,112)     2,107,615     (2,322,018)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                   2,424,571        316,956      2,638,974
                                                               -----------    -----------    -----------

CASH AND CASH EQUIVALENTS, END OF PERIOD                       $ 1,794,459    $ 2,424,571    $   316,956
                                                               ===========    ===========    ===========
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                                       -7-

<PAGE>

           First Federal Savings and Loan Association of Sistersville
                        NOTES TO THE FINANCIAL STATEMENTS
                                 MARCH 31, 1997

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    This summary of significant  accounting  policies is presented to assist the
    reader in  understanding  and evaluating  the financial  statements of First
    Federal  Savings and Loan  Association of  Sistersville.  The accounting and
    reporting  policies  of  the  Association   conform  to  generally  accepted
    accounting  principles and to general  practices within the savings and loan
    industry.  The following is a description  of the more  significant of those
    policies.

    Nature of Operations - First Federal Savings and Loan  Association  provides
    savings and financing services  primarily to individuals  through its office
    located in Sistersville,  West Virginia. Primary deposit products consist of
    savings,  NOW and Money Market  withdrawal  accounts,  and  certificates  of
    deposit.   Primary  lending  products  consist  of  conventional   mortgage,
    construction, and consumer loans.

    Subsidiary - In March,  1997, the  Association's  subsidiary,  First Service
    Corporation,  ceased  operations  with assets  consisting  of $1,000 in cash
    being transferred to the Association.  The former subsidiary had no activity
    for the years ended March 31, 1997, 1996, and 1995.

    Investment Securities - Effective April 1, 1994, the Association adopted the
    provisions  of Statement of Financial  Accounting  Standards  (FAS) No. 115,
    "Accounting for Certain  Investments in Debt and Equity  Securities."  Under
    FAS No. 115, investment securities in the portfolio are classified as either
    available for sale or held to maturity.  The Association  does not currently
    conduct short term purchase and sale  transactions of investment  securities
    which would be classified as trading securities.

    The initial  determination  of investments  classified as available for sale
    was based  principally  on the  Association's  asset/liability  position and
    potential  liquidity  needs.  These securities are available for sale at any
    time based upon management's  assessment of changes in economic or financial
    market   conditions,   interest   rate  or   prepayment   risks,   liquidity
    considerations,  and other factors.  Securities  classified as available for
    sale are carried at market value. The unrealized holding gains (losses), net
    of  taxes,  related  to  securities  classified  as  available  for sale are
    reflected as a component of equity.

    All remaining  securities in the investment portfolio are classified as held
    to maturity.  The Association purchases these securities with the intent and
    the ability to hold until their maturity.  Securities  classified as held to
    maturity  are carried at cost,  adjusted  for  amortization  of premiums and
    accretion of discounts.

    Gains or losses on  dispositions  of investment  securities  are computed by
    using the adjusted cost of the specific  certificates sold. Securities gains
    or losses are shown  separately as non-interest  income in the Statements of
    Operations.


                                       -8-

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

    The  accounting  effect of  adopting  FAS No. 115 on April 1,  1994,  was to
    increase  investments  by  $265,869  and  increase  shareholders  equity  by
    $175,474 after the tax effect of $90,395.

    In  November,   1995,  the  Financial   Accounting  Standards  Board  issued
    implementation  guidance on FAS No. 115. In accordance  with this  guidance,
    the Association reassessed the appropriateness of the classifications of all
    securities. As a result, securities with an amortized cost of $3,497,099 and
    unrealized  loss of  $29,062  were  transferred  from the  held to  maturity
    category to the available for sale category in December, 1995.

    Reclassification  - Certain  amounts  for the year ended  March 31, 1996 and
    1995,  have  been   reclassified  to  conform  with  the  current   period's
    presentation.

    Office  Properties  and  Equipment - Land is carried at cost;  buildings and
    equipment are stated at cost, less  accumulated  depreciation.  Maintenance,
    repairs,  and minor  improvements  are  charged  to  operating  expenses  as
    incurred. Major improvements and betterments are capitalized.

    Depreciation is computed on the straight-line method for financial reporting
    purposes over the following estimated useful lives:

            Building and improvements                           10 - 50 years
            Furniture, fixtures and equipment                    5 - 10 years

    Real  Estate  Acquired  in  Settlement  of Loans  -Real  estate  acquired in
    settlement of loans is classified  separately on the statements of financial
    condition  at the lower of the  recorded  investment  in the property or its
    fair value minus estimated costs of sale.

    Interest  and Fees on Loans - Loans  receivable  are stated at their  unpaid
    principal  balance,  net of the allowance  for losses on loans.  Interest on
    loans  is  credited  to  income  as  earned  and is  accrued  only  if it is
    considered  collectible.  An allowance for uncollected  interest on mortgage
    loans is provided for all accrued  interest on loans which are delinquent 90
    days or more resulting in interest  previously  accrued on those loans being
    reversed from income,  and  thereafter,  interest is recognized  only to the
    extent of payments received.  Loans are returned to accrual status when less
    than 90 days  delinquent and when, in management's  judgment,  collection is
    probable.

    Effective  April 1, 1995, the  Association  adopted  Statement of  Financial
    Accounting  Standards No. 114, "Accounting by Creditors for Impairment  of a
    Loan" and Statement of Financial  Accounting Standards  No. 118, "Accounting
    by Creditors for Impairment of a Loan-Income  Recognition  and  Disclosures"
    (FAS No. 114 and No. 118). Impaired loans as defined by FAS  No. 114 and No.
    118 exclude certain consumer loans and residential real estate  loans.  Loan
    impairment is measured  based on the present value of estimated  cash  flows
    discounted  at the loan's  effective  interest rate or at the fair value  of
    the collateral if the loan is collateral  dependent.  Since the adoption  of
    FAS No. 114 and No. 118, the Association had no loans which  management  has
    determined to be impaired.

                                       -9-

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

    Loan  origination  and commitment  fees and certain direct loan  origination
    costs are deferred,  and the net amount amortized over the contractual lives
    of the related loans or  commitments  as an adjustment of the related loan's
    yield using the interest method.

    Allowance for Loan Losses - The allowance for loan losses is maintained at a
    level which, in management's  judgment,  is adequate to absorb credit losses
    inherent  in the loan  portfolio.  The amount of the  allowance  is based on
    management's  evaluation  of  the  collectibility  of  the  loan  portfolio,
    including  the nature of the  portfolio,  credit  concentrations,  trends in
    historical  loss   experience,   specific   impaired  loans,   and  economic
    conditions.  Allowances for impaired loans are generally determined based on
    collateral  values  or the  present  value  of  estimated  cash  flows.  The
    allowance is increased by a provision  for loan losses,  which is charged to
    expense  and  reduced  by  charge-offs,  net of  recoveries.  Changes in the
    allowance  relating  to  impaired  loans  are  charged  or  credited  to the
    provision  for  loan  losses.  Because  of  uncertainties  inherent  to  the
    estimation process,  management's  estimate of credit losses inherent in the
    loan portfolio and the related allowance may change in the near term.

    Income Taxes - In February 1992, the Financial  Accounting  Standards  Board
    issued Statement of Financial  Accounting Standards No. 109, "Accounting for
    Income  Taxes".  FAS No. 109 requires a change from the  deferred  method of
    accounting  for income  taxes of APB  Opinion 11 to the asset and  liability
    method of accounting for income taxes.  Under the asset and liability method
    of FAS No. 109,  deferred tax assets and  liabilities are recognized for the
    future tax  consequences  attributable to differences  between the financial
    statement  carrying  amounts of existing  assets and  liabilities  and their
    respective tax bases. Deferred tax assets and liabilities are measured using
    enacted tax rates  expected to apply to taxable income in the years in which
    those temporary  differences are expected to be recovered or settled.  Under
    FAS No. 109, the effect on deferred tax assets and  liabilities  of a change
    in tax rates is  recognized  in  income  in the  period  that  includes  the
    enactment date.

    Retirement  Plan - The  retirement  plan is a  noncontributory  plan for all
    eligible  employees  and  is  funded  through  the  Financial   Institutions
    Retirement  Fund. All past service costs have been funded and  appropriately
    expensed.

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

                                      -10-

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)


NOTE 2 - STATEMENTS OF CASH FLOWS

    For the purpose of these statements,  cash equivalents include cash in other
    banks and Federal Home Loan Bank demand accounts.

    The  Association  made federal income tax payments for the years ended March
    31, 1997, 1996, and 1995, of $99,000, $130,594, and $79,255, respectively.

    The  Association  paid  interest  on  deposits  and  Federal  Home Loan Bank
    advances for the years ended March 31, 1997,  1996,  and 1995,  of $981,578,
    $975,666, and $841,644, respectively.


NOTE 3 - INVESTMENTS

    The  carrying  amounts  and  fair  values  of the  Association's  investment
    securities at March 31, 1997 and 1996, are summarized as follows:

<TABLE>
<CAPTION>
                                                                         March 31, 1997
                                                ---------------------------------------------------------------
                                                                     Gross          Gross
                                                       Book        Unrealized    Unrealized          Fair
                                                      Value          Gains         Losses            Value
                                                ---------------   ------------   ------------    --------------
<S>                                              <C>              <C>             <C>            <C>          
    Securities Available for Sale:
    Federal Home Loan Bank Stock
     (restricted)                                $      203,300   $        -      $       -      $     203,300
    Federal Home Loan Mortgage
     Corporation stock                                   22,231        627,671            -            649,902
    U.S. Government and Federal
      Agencies                                        1,498,588            -           32,157        1,466,431
                                                 --------------   ------------    -----------    -------------
        Total Available for Sale                      1,724,119        627,671         32,157        2,319,633

    Securities to be Held to Maturity:
    Mortgage-Backed Securities-GNMA                     328,053          7,000            -            335,053
                                                 --------------   ------------    -----------    -------------

        Total                                    $    2,052,172   $    634,671    $    32,157    $   2,654,686
                                                 ==============   ============    ===========    =============
</TABLE>


The gross  realized  losses were $-0- for March 31,  1997,  $8,340 for March 31,
1996, and $-0- for March 31, 1995.

                                       11

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 3 - INVESTMENTS (CONTINUED)
<TABLE>
<CAPTION>
                                                                         March 31, 1996
                                                 --------------------------------------------------------------
                                                                      Gross        Gross
                                                      Book         Unrealized    Unrealized         Fair
                                                      Value           Gains        Losses           Value
                                                 --------------   -------------  ----------     ---------------
<S>                                              <C>              <C>             <C>           <C>           
    Securities Available for Sale:
    Federal Home Loan Bank Stock
      (restricted)                               $      183,000   $        -      $       -     $      183,000
    Federal Home Loan Mortgage
     Corporation Stock                                   22,231        460,228            -            482,459
    U.S. Government and
      Federal Agencies                                1,497,724            -           28,594        1,469,130
                                                 --------------   ------------    -----------   --------------
        Total Available for Sale                      1,702,955        460,228         28,594        2,134,589
                                                 --------------   ------------    -----------   --------------

    Securities to be Held to Maturity:
    U.S. Government and
      Federal Agencies                                  397,902          2,098            -            400,000
    Mortgage-Backed Securities-GNMA                     377,123          7,144            -            384,267
                                                 --------------   ------------    -----------   --------------
        Total Held to Maturity                          775,025          9,242            -            784,267
                                                 --------------   ------------    -----------   --------------

        Total                                    $    2,477,980   $    469,470    $    28,594   $    2,918,856
                                                 ==============   ============    ===========   ==============

</TABLE>

        The book value and fair value of investment securities at March 31, 1997
        and 1996, by contractual maturity,  are shown below. Expected maturities
        will differ from contractual  maturities  because borrowers may have the
        right to call or prepay  obligations  with of without call or prepayment
        penalties.
<TABLE>
<CAPTION>

                                                                      March 31, 1997
                                                 --------------------------------------------------------------
                                                    Securities to be Held          Securities Available
                                                         to Maturity                    for Sale
                                                 ---------------------------   --------------------------------
                                                    Amortized      Fair          Amortized            Fair
                                                      Cost         Value           Cost               Value
                                                 -------------- ------------   --------------   ---------------

<S>                                               <C>            <C>            <C>              <C>        
        Due in one year or less                   $        -     $      -       $          -     $         -
        Due from one year
          through five year                                -              -          1,498,588       1,466,431
        Due after five year
          through ten years                                -              -                -               -
        Equity securities                                  -              -            225,531         853,202
        Mortgage-backed securities -
          GNMA                                         328,053        335,053              -               -
                                                  ------------   ------------   --------------   -------------

                Total                             $    328,053   $    335,053   $    1,724,119   $   2,319,633
                                                  ============   ============   ==============   =============

</TABLE>


                                      -12-

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 3 - INVESTMENTS (CONTINUED)
<TABLE>
<CAPTION>

                                                                          March 31, 1996
                                                ----------------------------------------------------------------
                                                      Securities to Be Held           Securities Available
                                                          to Maturity                      for Sale
                                                ------------------------------- --------------------------------
                                                     Amortized         Fair        Amortized          Fair
                                                        Cost           Value          Cost            Value
                                                --------------- --------------  ---------------  ---------------

<S>                                              <C>            <C>             <C>              <C>         
        Due in one year or less                  $    397,902   $     400,000   $          -     $          -
        Due from one year
          through five years                              -               -          1,497,724        1,469,130
        Due after five years
          through ten years                               -               -                -                -
        Equity securities                                 -               -            205,231          665,459
        Mortgage-backed securities -
          GNMA                                        377,123         384,267                -              -
                                                 ------------   -------------   --------------  ---------------

                Total                            $    775,025   $     784,267   $    1,702,955   $    2,134,589
                                                 ============   =============   ==============   ==============
</TABLE>


NOTE 4 - LOANS RECEIVABLE

    Loans receivable are summarized as follows:


                                                         March 31,
                                                 --------------------------
                                                     1997         1996
                                                 -----------   ------------

        Mortgage Loans:
          Construction                           $   141,000   $   358,800
          1-4 family                              21,036,190    19,132,196
        Consumer Loans:
          Automobiles                                763,843       786,468
          Savings account                            296,186       404,904
          Other                                       28,857        25,873
        Commercial                                    27,008        36,633
                                                 -----------   -----------
                 Total                            22,293,084    20,744,874

        Less:
          Reserve for loan losses
            on mortgage loans                        131,400       126,750
          Reserve for loan losses
            on consumer loans                         32,750        29,667
          Undisbursed funds                          322,670       466,980
          Income deferred to future operations        81,395        82,785
                                                 -----------   -----------

        Loans receivable, net                    $21,724,869   $20,038,692
                                                 ===========   ===========


                                      -13-

<PAGE>

           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)


NOTE 4 - LOANS RECEIVABLE (CONTINUED)

    Activity in the allowance for loan losses is summarized as follows

<TABLE>
<CAPTION>
                                                                                       Year Ended
                                                                                        March 31,
                                                                       -----------------------------------------
                                                                           1997           1996         1995
                                                                       ------------   -----------   ------------

<S>                                                                    <C>           <C>           <C>         
    Balance, beginning of period                                       $    156,417  $    149,617  $    120,470
    Provision charged to income                                               7,733         6,800        27,900
    Recoveries                                                                  -             -           1,247
                                                                       ------------  ------------  ------------

    Balance, end of period                                             $    164,150  $    156,417  $    149,617
                                                                       ============  ============  ============

</TABLE>

NOTE 5 - OFFICE PROPERTIES AND EQUIPMENT

    Office properties and equipment are summarized as follows:
<TABLE>
<CAPTION>
                                                                                 March 31,
                                                                      --------------------------------
                                                                             1997              1996
                                                                      -------------      -------------


<S>                                                                    <C>               <C>         
        Land                                                           $     38,500      $     38,500
        Office buildings and improvements                                   406,233           406,233
        Furniture, fixtures, and equipment                                  172,842           170,216
                                                                       ------------      ------------
                Total                                                       617,575           614,949
        Less accumulated depreciation                                       254,037           214,235
                                                                       ------------      ------------

                Net office properties and equipment                    $    363,538      $    400,714
                                                                       ============      ============

</TABLE>

    Depreciation charged to operations was $39,802, $26,491, and $18,404 for the
    years ended March 31, 1997, 1996, and 1995, respectively.


                                      -14-

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)



NOTE 6 - DEPOSITS ANALYSIS

    The Association has savings  accounts with interest rates ranging from 3.25%
    to 7.30% at March  31,  1997 and  1996.  Such  deposits  are  summarized  as
    follows:

<TABLE>
<CAPTION>

                                         
                                          Weighted                  March 31, 1997            March 31, 1996
          Interest Paid                   Average             ------------------------  -------------------------
              Paid                         Rate                    Amount      Percent       Amount      Percent
          --------------                  --------            --------------   -------  -------------   ---------

<S>                                        <C>                 <C>               <C>    <C>               <C> 
          Savings - Passbook               4.00 %              $   8,619,721     39.7   $   8,269,871     39.2
          Christmas Clubs                  3.50                       34,098       .2          32,032       .2
          NOW & MMDA accounts              3.46                    2,912,286     13.4       2,699,712     12.8
          3.01 to 4.00                                                   -        0.0          29,795       .1
          4.01 to 5.00                     4.82                    2,970,179     13.7       4,423,114     21.0
          5.01 to 6.00                     5.38                    5,062,733     23.3       3,132,215     14.9
          6.01 to 7.00                     6.67                    1,737,202      8.0       2,136,366     10.1
          7.01 to 8.00                     7.27                      363,506      1.7         367,710      1.7
                                                               -------------  -------    ------------    -----

                Total                                          $  21,699,725    100.0   $  21,090,815    100.0
                                                               =============    =====   =============    =====
</TABLE>


    The   Association   had  jumbo   certificates  of  deposit  with  a  minimum
    denomination  of  $100,000  in the amount of  $402,589 at March 31, 1997 and
    $300,000 at March 31, 1996. Deposits in excess of $100,000 are not federally
    insured.

    The deposit accounts mature as follows:
<TABLE>
<CAPTION>

                                                                                       March 31,
                                                                        -----------------------------------
                                                                              1997                  1996
                                                                        ---------------     ---------------

<S>                                                                     <C>                 <C>                    
    Certificates of deposit:
        One year                                                        $     6,004,566     $     5,570,724
        One to two years                                                      1,987,291           1,852,575
        Two to three years                                                    1,332,665           1,220,563
        Three to four years                                                     387,521           1,085,954
        Four to five years                                                      421,577             359,384
                                                                        ---------------     ---------------
                                                                             10,133,620          10,089,200
    Passbook, NOW, and
     MMDA accounts                                                           11,566,105          11,001,615
                                                                        ---------------     ---------------

                Total                                                   $    21,699,725     $    21,090,815
                                                                        ===============     ===============
</TABLE>


                                      -15-

<PAGE>
           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)


NOTE 6 - DEPOSITS ANALYSIS (CONTINUED)

    Interest expense by deposit category is as follows:
<TABLE>
<CAPTION>
                                                                                        Year Ended
                                                                                        March 31,
                                                                      ------------------------------------------
                                                                            1997           1996          1995
                                                                      -------------  ------------   ------------

<S>                                                                    <C>           <C>            <C>         
    Savings - passbook                                                 $    338,216  $    328,505   $    407,584
    NOW and money market                                                     93,280        96,160        123,271
    Time certificates of deposit                                            548,041       530,889        287,793
                                                                       ------------  ------------   ------------

        Total                                                          $    979,537  $    955,554   $    818,648
                                                                       ============  ============   ============
</TABLE>

NOTE 7 - REGULATORY MATTERS

    The  Association  is  subject  to various  regulatory  capital  requirements
    administered  by  its  primary  federal  regulator,  the  Office  of  Thrift
    Supervision. Failure to meet the minimum regulatory capital requirements can
    initiate certain mandatory, and possible additional discretionary actions by
    regulators,  that if undertaken,  could have a direct material affect on the
    Association's  financial  statements.  Under the regulatory capital adequacy
    guidelines and the regulatory  framework for prompt corrective  action,  the
    Association must meet specific  capital  guidelines  involving  quantitative
    measures   of   the   Association's   assets,    liabilities   and   certain
    off-balance-sheet items as calculated under regulatory accounting practices.
    The  Association's  capital  amounts  and  classification  under the  prompt
    corrective  action  guidelines are also subject to qualitative  judgement by
    the regulators about components, risk weighting, and other factors.

    Quantitative  measures  established by regulation to ensure capital adequacy
    require the  Association to maintain  minimum amounts and ratios of tangible
    capital,  tangible  equity,  core capital (Tier 1),  leverage  capital,  and
    risk-based capital.

    As of March 31, 1997, the most recent  notification from the OTS categorized
    the  Association as "well  capitalized"  under the regulatory  framework for
    prompt  corrective  action.  To be  categorized  as "well  capitalized"  the
    Association must maintain minimum total risk-based, core (Tier 1), leverage,
    and tangible ratios set forth in the table below. There are no conditions or
    events since the  notification  that  management  believes  have changed the
    institution's category.

    The  Association's  actual capital  amounts and ratios are also presented in
    the table. Risk-based capital includes tangible capital plus $160,000 of the
    Association's allowance for loan losses.

<TABLE>
<CAPTION>
                                                                                               To Be Well
                                                                                            Capitalized Under
                                                                       For Capital          Prompt Corrective
                                                  Actual           Adequacy Purposes        Action Provisions
                                            -----------------      -----------------        -----------------
                                            Amount      Ratio        Amount   Ratio         Amount      Ratio
                                            ------      -----        ------   -----         ------      -----

<S>                                        <C>          <C>       <C>          <C>        <C>           <C>  
                                              (In thousands)        (In thousands)           (In thousands)
    As of March 31, 1997:
        Total risk-based capital           $  4,570     35.8%     $  1,022     8.0%       $  1,277      10.0%
                (To risk weighted assets)
        Core (Tier 1) capital                 4,410     34.5%          511     4.0%            766       6.0%
                (To risk weighted assets)
        Core (Tier 1) capital                 4,410     16.7%          793     3.0%          1,321       5.0%
                (To total assets)
        Tangible capital                      4,410     16.7%          396     1.5%          Not Defined
                (To total assets)
</TABLE>

                                      -16-
<PAGE>



           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 8 - FEDERAL INCOME TAX

    The  Association  was  permitted  until 1996 a special  bad debts  deduction
    limited  generally to 8% of otherwise  taxable income and subject to certain
    limitations based on aggregate loans and savings account balances at the end
    of the year. In 1996,  the bad debt reserve  method for Thrifts was repealed
    and in the  future bad debts for  federal  income  taxes will be  determined
    based  primarily on the  experience  method.  If the amounts that qualify as
    deductions for federal income tax purposes are later used for purposes other
    than for bad debt losses,  they will be subject to federal income tax at the
    then corporate rate.  Retained  income at March 31, 1997 and 1996,  included
    approximately $696,000 for which federal income tax has not been provided.

    The provisions for Federal income taxes consist of:


                                                         Year Ended
                                                          March 31,
                                          --------------------------------------
                                               1997         1996         1995
                                          ------------  -----------   ----------

        Current                           $    80,581   $   133,202   $  105,585
        Deferred                              (17,436)      (20,004)      20,019
                                          -----------   -----------   ----------

                Total                     $    63,145   $   113,198   $  125,604
                                          ===========   ===========   ==========



    The following  temporary  differences  gave rise to the deferred tax (asset)
liability at:
<TABLE>
<CAPTION>

                                                                           March 31,                  
                                                                    -----------------------
                                                                       1997         1996
                                                                    ----------   ----------
         
         <S>                                                        <C>          <C>       
         Deferred loan fees                                         $ (27,674)   $ (28,147)
         Other income and expense recognized in the financial
           statements on the accrual basis, but on the cash basis
           for tax purposes                                            31,440       52,558
         Bad debt reserve, net                                        (13,260)     (12,750)
         Depreciation                                                  12,654       14,515
         Others                                                         9,456        3,876
                                                                    ---------    ---------
                                                                       12,616       30,052
         Deferred tax liability arising from market
          adjustments of securities available for sale                202,475      146,754
                                                                    ---------    ---------
         
              Total deferred tax liability (asset)                  $ 215,091    $ 176,806
                                                                    =========    =========
         
</TABLE>

                                      -17-

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)


NOTE 8 - FEDERAL INCOME TAX (CONTINUED)

    A  reconciliation  between the amount of reported income tax expense and the
    amount  computed by applying  the Federal  income tax rate to income  before
    income taxes is as follows:

                                                   March 31,
                                    -------------------------------------
                                       1997          1996          1995
                                    ---------     ---------     ---------


Tax at statutory rate (34%)         $  71,610     $ 105,548     $ 120,972
     Increase (decrease) in taxes
      resulting from:
       Nondeductible (nontaxable)
        expenses and income            (1,958)        2,312         9,486
         Surtax exemption              (6,507)       (2,040)          -
       Others, net                        -           7,378        (4,854)
                                    ---------     ---------     ---------

          Total                     $  63,145     $ 113,198     $ 125,604
                                    =========     =========     =========

Effective rate                         30.0%         36.5%         35.3%


NOTE 9 - RETIREMENT PLAN

    The Association  participates in the multi-employer  Financial  Institutions
    Retirement  Fund covering all officers and employees.  Because the plan is a
    multi-employer  plan, the data available from the  administrator of the plan
    is not  sufficient  to determine  actuarial  information  applicable  to the
    Association.  The plan is  noncontributory  and  benefits  are funded by the
    Association's  monthly  contribution  to the Trust Fund.  All prior  service
    pension costs have been paid.  Pension expense for the years ended March 31,
    1997, 1996, and 1995, amounted to $9,150, $17,225, and $7,367, respectively.

NOTE 10 - FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

    First Federal  Savings and Loan  Association of  Sistersville  is a party to
    financial  instruments with  off-balance-sheet  risk in the normal course of
    business  to meet the  financing  needs of its  customers.  These  financial
    instruments include commitments to extend credit. These instruments involve,
    to  varying  degrees,  elements  of  credit  risk in  excess  of the  amount
    recognized  in the  consolidated  statements  of  financial  condition.  The
    contract amounts of these instruments  reflect the extent of involvement the
    institution  has  in  particular  classes  of  financial  instruments.   The
    institution  uses  the  same  credit  policies  in  making  commitments  and
    conditional obligations as it does for on-balance-sheet instruments.



                                      -18-

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)


NOTE 10 - FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK (CONTINUED)

    The  following  represents  financial  instruments  whose  contract  amounts
represent credit risk at:

                                                        March 31,
                                                  -------------------
                                                    1997       1996
                                                  --------   --------

            Commitments to originate loans        $404,100   $291,000
            Loans in process                       322,670    466,980

    Commitments to extend credit are agreements to lend to a customer as long as
    there  is no  violation  of  any  condition  established  in  the  contract.
    Commitments  generally  have  fixed  expiration  dates or other  termination
    clauses and may require  payment of a fee. The  institution  evaluates  each
    customer's   creditworthiness   on  a  case-by-case  basis.  The  amount  of
    collateral  obtained,  if deemed necessary by the institution upon extension
    of credit,  is based on management's  credit evaluation of the counterparty.
    Collateral held consists primarily of single-family residences.  Commitments
    to originate loans at March 31, 1997, consisted of fixed rate mortgage loans
    at rates raging from 7.75% to 8.25%.

    Concentration of Credit Risk

    First Federal  Savings and Loan  Association of  Sistersville's  real estate
    loans and loan commitments are primarily for properties  located  throughout
    Northern West  Virginia.  Repayment of these loans is in part dependent upon
    the economic  conditions  in this  region.  First  Federal  Savings and Loan
    Association of Sistersville evaluates each customer's  creditworthiness on a
    case-by-case  basis. The Association  requires collateral on all real estate
    exposure which consists primarily of residential properties.


NOTE 11 - RELATED PARTY TRANSACTIONS

    Directors and officers of the  Association  were customers of, and had other
    transactions with, the Association in the ordinary course of business during
    the years ended March 31, 1997 and 1996, and 1995.

    Loans  and  commitments   included  in  such  transactions  were  made  with
    substantially  the same terms and collateral as those prevailing at the time
    for  comparable  transactions  with other  persons.  Loans to directors  and
    officers  did not involve  more than the normal risk of  collectibility,  or
    present other unfavorable  features.  The loans to directors and officers at
    March  31,  1997,  1996  and  1995,  were  $72,305,  $53,000,  and  $88,052,
    respectively, in the aggregate amount.




                                      -19-

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)


NOTE 12 - FAIR VALUE OF FINANCIAL INSTRUMENTS

    The following methods and assumptions were used in estimating fair values of
    financial instruments as disclosed herein:

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

         Investment Securities and Securities Held for Sale: For debt securities
         and marketable equity  securities held for investment  purposes and for
         sale,  fair values are based on quoted market prices or dealer  quotes.
         If a quoted  market  price is not  available,  fair value is  estimated
         using quoted market prices for similar securities.

         Loans:  For  certain  homogeneous  categories  of  loans,  such as some
         residential mortgages,  fair value is estimated using the quoted market
         prices for securities  backed by similar loans. The fair value of other
         types of loans is estimated by discounting  the future cash flows using
         the current  rates at which  similar  loans would be made to  borrowers
         with similar credit ratings and for the same remaining maturities.

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

    The estimated fair values of the Association's  financial instruments are as
follows:
<TABLE>
<CAPTION>
                                                       March 31, 1997                   March 31, 1996
                                             -------------------------------   ------------------------------
                                                Carrying        Estimated         Carrying        Estimated
                                                Amount          Fair Value        Amount          Fair Value
                                             -------------     -------------   -----------      -------------

<S>                                          <C>               <C>             <C>              <C>          
         Financial Assets:
            Cash and cash equivalents        $   1,794,000     $   1,794,000   $    2,425,000   $   2,425,000
            Securities available for sale        2,320,000         2,320,000        2,135,000       2,135,000
            Securities held to maturity            328,000           335,000          775,000         784,000
            Loans, net                          21,725,000        21,782,000       20,039,000      20,456,000

         Financial Liabilities:
            Deposits                            21,700,000        21,584,000       21,091,000      21,064,000

</TABLE>


                                      -20-

<PAGE>



           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)


NOTE 13 - DEPOSIT INSURANCE

    Saving  Association  Insurance  Fund  member  institutions  were  assessed a
    one-time deposit  insurance premium to recapitalize the Fund. The assessment
    totaled  approximately  $129,000 and was recorded  during the year end March
    31, 1997. The premium was based on deposits as of March 31, 1995 at .657 per
    $100 of deposits.  As a result of the assessment,  the Association's deposit
    insurance rate was reduced from $ .23 to $ .065 per $100 of deposits.


NOTE 14 - CONVERSION AND REORGANIZATION (UNAUDITED)

    On December 5, 1996, the Board of Directors of the  Association,  subject to
    regulatory  approval,  adopted the Plan of Conversion  pursuant to which the
    Association  proposed to convert from a  federally-chartered  mutual savings
    and loan to a federally-chartered stock savings institution and concurrently
    form a Bank Holding  Company.  The conversion is expected to be accomplished
    through amendment of the  Association's  federal charter and the sale of the
    holding  company's  common  stock in an amount equal to the pro forma market
    value of the bank after  giving  effect of the  conversion.  A  subscription
    offering of the sale of the bank's common stock will be offered initially to
    the bank's depositors,  then to other members and directors,  officers,  and
    employees of the bank. Any shares of the bank's common stock not sold in the
    subscription  offering will be offered for sale to the general public in the
    bank's market area.

    Conversion  costs will be deferred  and  deducted  from the  proceeds of the
    shares  sold in the  conversion.  At March 31,  1997,  the  Association  had
    incurred  approximately  $127,000 in conversion costs. In the event that the
    conversion is not completed,  any deferred  conversion costs will be charged
    to operations.

    In accordance  with  regulations,  at the time that the bank converts from a
    mutual  savings  Association  to a stock savings  institution,  a portion of
    retained earnings will be restricted by establishing a liquidation  account.
    The  liquidation  account  will be  maintained  for the  benefit of eligible
    account  holders who continue to maintain  their  accounts at the bank after
    the  conversion.  The  liquidation  account will be reduced  annually to the
    extent that eligible account holders have reduced their qualifying deposits.
    Subsequent  increases will not restore an eligible account holder's interest
    in the liquidation  account.  In the event of a complete  liquidation of the
    bank,  each account holder will be entitled to receive a  distribution  from
    the liquidation  account in an amount  proportionate to the current adjusted
    qualifying balances of accounts then held. The bank may not pay dividends if
    those dividends  would reduce equity capital below the required  liquidation
    account amount.



                                      -21-

<PAGE>


           First Federal Savings and Loan Association of Sistersville
                  NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)


NOTE 15 - ADVANCES FROM FEDERAL HOME LOAN BANK

    As of March 31, 1997, the Association had a Flexline line of credit with the
    Federal  Home  Loan  Bank of  $1,874,000  of  which  there  were no  amounts
    outstanding.


NOTE 16 - SUBSEQUENT EVENT

    Effective May 14, 1997,  the  Association  received  regulatory  approval to
    proceed with its subscription  offering of the sale of the holding company's
    (Sistersville  Bancorp,  Inc.)  common  stock as  outlined  in Note 14.  The
    estimated  proforma market value of the common stock at the inception of the
    offering ranged from $5,100,000 to $6,900,000 ("Estimated Valuation Range").
    The offering  period expired at 12:00 p.m.,  Eastern  Standard Time, on June
    16, 1997, with  subscriptions  for shares totaling 661,428 shares at $10 per
    share. On June 25, 1997, the conversion to a  stock-savings  institution was
    closed and the holding company acquired all the outstanding shares of common
    stock  of the  savings  bank  at a cost  approximating  $3.1  million  which
    represented one-half of the net proceeds from the offering. Conversion costs
    incurred in  connection  with the offering and deducted from the proceeds of
    the shares sold in the conversion approximated $419,000.

    As part of the offering, the Association adopted an Employee Stock Ownership
    Plan (ESOP).  The ESOP  purchased  52,914 shares (8%) of the common stock of
    the holding  company  sold in the  offering.  The ESOP  purchase  was funded
    through a loan from the holding  company from the net  proceeds  retained by
    the  company.  Shares of common  stock held by the ESOP are  expected  to be
    awarded to employees as compensation over a ten year period.



                                      -22-


<PAGE>



                                   SIGNATURES

         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized as of July 29, 1997.

                                  SISTERSVILLE BANCORP, INC.



                                  By: /s/ Stanley M. Kiser
                                      ------------------------------------------
                                      Stanley M. Kiser
                                      President and Chief Executive Officer
                                      (Duly Authorized Representative)


         Pursuant to the  requirement  of the  Securities  Exchange Act of 1934,
this  report has been  signed  below by the  following  persons on behalf of the
registrant and in the capacities indicated as of July 29, 1997.


/s/ Stanley M. Kiser                        /s/ Lester C. Doak
------------------------------------------      --------------------------------
Stanley M. Kiser                                Lester C. Doak
President and Chief Executive Officer           Chairman of the Board
(Principal Executive and Financial Officer)


/s/ Gary L. Ward                            /s/ Ellen E. Thistle
------------------------------------------      --------------------------------
Gary L. Ward                                    Ellen E. Thistle
Director                                        Assistant Secretary and Director


/s/ David W. Miller                        /s/ Dorsey R. Ash
------------------------------------------     ---------------------------------
David W. Miller                                Dorsey R. Ash
Vice President and Director                    Director


/s/ Charles P. LaRue                       /s/ Guy L. Nichols
------------------------------------------     ---------------------------------
Charles P. LaRue                               Guy L. Nichols
Director                                       Director


/s/ Margaret A. Peters                     /s/ James E. Willison
------------------------------------------     ---------------------------------
Margaret A. Peters                             James E. Willison
Director                                       Director