UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

(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
                               -------------------

 X    TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR  15(d)  OF THE  SECURITES
---   EXCHANGE ACT OF 1934

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


Commission File Number:     0-23878
                          -----------------


                              BECKLEY BANCORP, INC.
--------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

               DELAWARE                                         55-0733525
--------------------------------------------------------------------------------
(State or other jurisdiction of incorporation                (I.R.S. Employer
or organization)                                            Identification No.)

      200 MAIN STREET, BECKLEY, WEST VIRGINIA                      25801
--------------------------------------------------------------------------------
      (Address of principal executive offices)                   (Zip Code)

                                 (304) 252-6201
--------------------------------------------------------------------------------
              (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  regristrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.
                                                      X    Yes         No
                                                    -----         -----

      Indicate the number of shares  outstanding of each of the issuer's classes
of common stock as of July 22, 1997:

                  Class                               Outstanding
                  -----                               -----------
        $.10 par value common stock                  602,465 shares


<PAGE>

                             BECKLEY BANCORP, INC.

                                     INDEX


PART I - FINANCIAL INFORMATION
------------------------------


      Item 1. - Financial Statements
      ------

            Consolidated Statements of Financial Position
            as of June 30, 1997 (Unaudited) and as of
            December 31, 1996                                                1

            Consolidated Statements of Income for the
            Six Months Ended June 30, 1997 and
            1996 (Unaudited)                                                 2

            Consolidated Statements of Cash Flows for
            the Six Months Ended June 30, 1997
            and 1996 (Unaudited)                                         3 - 4

            Consolidated Statements of Shareholders'
            Equity for the Six Months Ended June 30,
            1997 and 1996 (Unaudited)                                        5

            Notes to Consolidated Financial
            Statements (Unaudited)                                       6 - 8


      Item 2. - Managements Discussion and Analysis of
      ------    Financial Condition and Results of
                Operations                                              9 - 15



PART II - OTHER INFORMATION
---------------------------

      Item 4. - Submission of Matters to a Vote of Security Holders         15
      -------

      Item 5. - Other Information                                           16
      -------

      Item 6. - Exhibits and Reports on Form 8-K                            17
      -------


SIGNATURES                                                                  18
----------



<PAGE>

BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 1. - Financial Statements
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Amounts in Thousands)

<TABLE>
<CAPTION>
                                                     June 30,        December 31,
                                                       1997              1996
                                                 -------------     -------------
                                                    (Unaudited)           *1
ASSETS
<S>                                              <C>               <C>          
Cash and due from banks                          $         469     $         334
Interest bearing deposits in other banks                   912               916
Securities available for sale                            4,272             5,997
Securities held-to-maturity (market
   values of $1,497 and $997, respectively)              1,497               997
Collateralized mortgage obligations and
   other mortgage-backed securities
   available-for-sale                                   16,255            16,484
Loans receivable, net - Note 4                          20,554            20,180
Bank premises and equipment, at cost
   net of accumulated depreciation                         552               551
Federal Home Loan Bank stock - at cost                     175               172
Accrued interest receivable                                256               268
Other assets                                                36                65
                                                 -------------     -------------
   TOTAL ASSETS                                         44,978            45,964
                                                 =============     =============

LIABILITIES AND
   STOCKHOLDERS' EQUITY
LIABILITIES
Deposit accounts                                        32,775            32,246
Short-term borrowings                                       --             2,000
Deferred income tax liability                              252               121
Accrued expenses and other liabilities                     379               315
                                                 -------------     -------------
   TOTAL LIABILITIES                                    33,406            34,682
                                                 -------------     -------------

STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value,
   250,000 shares authorized, none issued                   --                --
Common stock, $.10 par value,
   1,250,000 shares authorized,
   601,465 shares issued and outstanding                    60                60
Additional paid-in-capital                               5,684             5,674
Retained earnings (substantially restricted)             5,502             5,474
Unearned ESOP shares, at cost                             (136)             (153)
Unearned MSBP shares, at cost                              (47)              (59)
Net unrealized gain on
   securities available for sale                           509               286
                                                 -------------     -------------
   TOTAL STOCKHOLDERS' EQUITY                           11,572            11,282
                                                 -------------     -------------
   TOTAL LIABILITIES AND
      STOCKHOLDERS' EQUITY                       $      44,978     $      45,964
                                                 =============     =============
</TABLE>

*1 - Derived from the audited financial statements.

The accompanying notes are an integral part of these statements.

                                       1
<PAGE>


BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 1. - (Continued)
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Amounts in Thousands, Except Per Share Data)

<TABLE>
<CAPTION>
                                               Three Months           Six Months
                                                   Ended                Ended
                                                  June 30,             June 30,
                                            -----------------    -----------------
                                               1997     1996        1997     1996
                                            -------  --------    -------- --------

INTEREST AND DIVIDEND INCOME
<S>                                         <C>      <C>         <C>      <C>    
   Loans, including certain fees            $   427  $   376     $   846  $   739
   Investment securities                         65       70         143      155
   Collateralized mortgage obligations and
      other mortgage-backed securities          263      282         530      576
   Interest bearing deposit accounts             21       22          40       47
   Dividends, FHLB and other                      7        6          13       12
                                            -------  -------     -------  -------
      TOTAL INTEREST INCOME                     783      756       1,572    1,529
                                            -------  -------     -------  -------

INTEREST EXPENSE
   Deposit Accounts                             358      332         704      664
   Other                                         --        1          16        1
                                            -------  -------     -------  -------
      TOTAL INTEREST EXPENSE                    358      333         720      665
                                            -------  -------     -------  -------
NET INTEREST INCOME                             425      423         852      864

Provision for losses on loans - Note 1            2        5           4       20
                                            -------  -------     -------  -------
NET INTEREST INCOME AFTER
   PROVISION FOR LOSSES ON LOANS                423      418         848      844
                                            -------  -------     -------  -------

NON-INTEREST INCOME
   Service charges on deposit accounts           17       13          30       24
   Gain on sale of investment securities         --       --          --       --
   Other income                                   3        3           7        7
                                            -------  -------     -------  -------
      TOTAL NON-INTEREST INCOME                  20       16          37       31
                                            -------  -------     -------  -------

NON-INTEREST EXPENSE
   Salaries and employee benefits               133      127         271      264
   Occupancy and equipment expense               19       18          40       40
   Federal deposit insurance premiums             5       19          10       38
   Service bureau and other data processing      31       29          62       61
   Other                                        150       88         250      178
                                            -------  -------     -------  -------
      TOTAL NON-INTEREST EXPENSE                338      281         633      581
                                            -------  -------     -------  -------

INCOME BEFORE INCOME TAXES                      105      153         252      294
                                            -------  -------     -------  -------
Provision for income taxes                       41       59          95      114
                                            -------  -------     -------  -------
NET INCOME                                  $    64  $    94     $   157  $   180
                                            =======  =======     =======  =======


EARNINGS PER COMMON SHARE - Note 3          $  0.11     0.16     $  0.26     0.31
                                            =======  =======     =======  =======
</TABLE>


The accompanying notes are an integral part of these statements.

                                       2

<PAGE>

BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 1. - (Continued)
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Amounts in thousands)

<TABLE>
<CAPTION>
                                                   Six Months Ended June 30,
                                                  1997                  1996
                                              -------------         ------------

OPERATING ACTIVITIES:

<S>                                           <C>                   <C>        
Net Income                                    $       157           $       180

Adjustments to reconcile net income to net
   cash provided by operating activities:
   Depreciation                                        11                    11
   (Accretion) and amortization, net                  (22)                  (24)
   Provision for losses on loans                        4                    20
   Increase (decrease) in deferred loan fees           (3)                   (8)
   Amortized ESOP benefits                             28                    24
   Amortized MSBP compensation                         11                    11
   (Increase) decrease in accrued income and
      and other assets                                 41                   (70)
   Increase (decrease) in accrued expenses
      and other liabilities                            64                    64
                                              -----------           -----------
   NET CASH PROVIDED BY OPERATING
      ACTIVITIES                                      291                   208
                                              -----------           -----------

INVESTING ACTIVITIES:

Principal repayments and redemptions on
   collateralized mortgage obligations and
   other mortgage-backed securities
   -Available-for-sale                                317                   600
Purchases of investment securities
   -Available-for-sale                                 --                (3,000)
   -Held-to-maturity                               (4,986)               (2,495)
Proceeds from maturities or calls of
   investment securities
   -Available-for-sale                              2,000                 1,250
   -Held-to-maturity                                4,500                 6,500
Net increase in loans made to customers              (376)               (2,590)
Redemption of Federal Home Loan Bank stock             --                     4
Purchase of Federal Home Loan Bank stock               (3)                   --
Additions to premises and equipment                   (12)                 (122)
                                              -----------           -----------
   NET CASH PROVIDED (USED) BY INVESTING
      ACTIVITIES                              $     1,440           $       147
                                              -----------           -----------

</TABLE>


The accompanying notes are an integral part of these statements.

                                       3
<PAGE>


BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 1. - (Continued)
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Continued)
(Amounts in thousands)

<TABLE>
<CAPTION>

                                                  Six Months Ended June 30,
                                                 1997                   1996
                                              ------------          ------------

FINANCING ACTIVITIES:

<S>                                           <C>                   <C>         
Net increase/(decrease) in deposit accounts   $       529           $    (1,071)
Proceeds from short-term borrowings                 1,000                 1,000
Repayments of short-term borrowings                (3,000)                   --
Cash dividends paid on common stock                  (129)                 (116)
                                              -----------           ----------- 
   NET CASH PROVIDED BY FINANCING
      ACTIVITIES                                   (1,600)                 (187)
                                              -----------           ----------- 
Increase in cash and cash equivalents                 131                   168
Cash and cash equivalents, beginning
   of year                                          1,250                 1,371
                                              -----------           ----------- 
   CASH AND CASH EQUIVALENTS,
      END OF PERIOD                           $     1,381           $     1,539
                                              ===========           ===========




SUPPLEMENTAL DISCLOSURE OF CASH FLOW
   INFORMATION

Cash paid during the period for:

   Interest                                   $       715           $       664
                                              ===========           ===========

   Income taxes                               $        67           $       228
                                              ===========           ===========


Automobiles acquired in settlement
   of loans                                   $        --           $        16
                                              ===========           ===========

</TABLE>


The accompanying notes are an integral part of these statements.

                                       4

<PAGE>

BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 1. - (Continued)
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)
(Amounts in thousands)
                                                                     
<TABLE>
<CAPTION>
                                                                                                        Unrealized
                                                                                                          Gains/
                                                                                                       (Losses) on
                                                     Additional               Deferred     Unearned     Available
                                           Common      Paid-in     Retained     ESOP         MSBP        For-Sale
                                            Stock      Capital     Earnings    Benefit    Compensation  Securities     TOTAL
                                         ----------  -----------  ---------- ----------   ------------  ----------   ---------

SIX MONTHS ENDED JUNE 30, 1996

<S>                                      <C>         <C>          <C>        <C>          <C>                 <C>    <C>     
Balance, December 31, 1995               $       60  $     5,659  $   5,391  $    (185)   $       (83)        426    $ 11,268

Payment of $0.13 per share regular
   cash dividend on February 15, 1996                                   (75)                                              (75)

Payment of $0.07 per share special
   cash dividend on February 15, 1996                                   (41)                                              (41)

Net income, six months ended
   June 30, 1996                                                        180                                               180

Change in unrealized gain/(loss)
   on available-for-sale
   securities, net of tax                                                                                    (160)       (160)

Change in unearned ESOP shares                                 7                   17                                      24

Change in unearned MSBP shares                                (1)                                  12                      11
                                        ----------   -----------  ---------  ---------    -----------        ----    --------

Balance, June 30, 1996                  $       60   $     5,665  $   5,455  $    (168)   $       (71)        266    $ 11,207
                                        ==========   ===========  =========  =========    ===========        ====    ========



SIX MONTHS ENDED JUNE 30, 1997

Balance, December 31, 1996              $       60  $     5,674  $   5,474  $    (153) $         (59)         286    $ 11,282

Payment of $0.14 per share regular
   cash dividend on February 18, 1997                                  (82)                                               (82)

Payment of $0.08 per share special
   cash dividend on February 18, 1997                                  (47)                                               (47)

Net income, six months ended
   June 30, 1997                                                       157                                                157

Change in unrealized gain/(loss)
   on available-for-sale
   securities, net of tax                                                                                     223         223

Change in unearned ESOP shares                              11                     17                                      28

Change in unearned MSBP shares                              (1)                                   12                       11
                                        ----------  ----------   ---------  ---------  -------------         ----    --------

Balance, June 30, 1997                  $       60  $    5,684   $   5,502  $    (136) $         (47)         509    $ 11,572
                                        ==========  ===========  =========  =========  =============         ====    ========

</TABLE>

The accompanying notes are an integral part of these statements

                                       5

<PAGE>

BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION / Item 1.- (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


      PRINCIPLES  OF  CONSOLIDATION:   The  unaudited   consolidated   financial
      statements   include  the   accounts  of  Beckley   Bancorp,   Inc.   (the
      "Corporation")  and Beckley Federal Savings Bank (the "Savings Bank"), its
      wholly  owned  subsidiary.   All  significant  intercompany  balances  and
      transactions have been eliminated in consolidation.

      BASIS OF ACCOUNTING:  The accompanying  unaudited  consolidated  financial
      statements were prepared in accordance with generally accepted  accounting
      principles for interim  financial  information and with  instructions  for
      Form 10-QSB and Article 10 of  Regulation  S-X.  Accordingly,  they do not
      include all  information and  disclosures  required by generally  accepted
      accounting  principles for complete  financial  statements.  However,  all
      normal  recurring  adjustments  have been made  which,  in the  opinion of
      management,  are  necessary  to the  fair  presentation  of the  financial
      statements.

      The results of operations for the six month period ended June 30, 1997 are
      not  necessarily  indicative  of the results which may be expected for the
      year ending December 31, 1997.

      LOANS: Loans are stated at the unpaid principal amount outstanding, net of
      unearned income,  deferred fees and the allowance for losses.  Interest on
      loans is  credited  to  income  as  earned  and  accrued,  only if  deemed
      collectible.  The Bank  discontinues  recognizing  accrued interest when a
      loan is specifically determined to be impaired or when payment of interest
      becomes  past due by more than ninety  days.  Unpaid  interest  previously
      accrued on these loans is reversed from income.  Non-accrual  loans may be
      restored to accrual status when principal and interest  become current and
      full payment of principal and interest is expected.

      Loan  origination  fees and  certain  costs  of  originating  and  closing
      mortgage loans are deferred and  recognized  over the life of the loans as
      an  adjustment  of yield.  These  amounts are not  considered  material to
      operations.

      ALLOWANCE FOR LOSSES ON LOANS: The allowance for loan losses is maintained
      at a level believed  adequate by management to absorb  potential losses in
      the loan portfolio. The amount of the allowance is based upon management's
      evaluation of the


                                       6

<PAGE>



NOTE 1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

      collectibility  of the loan  portfolio,  including  historical  loan  loss
      experience,  growth  and  composition  of the loan  portfolio,  known  and
      inherent  risks in the portfolio,  current  economic  conditions,  adverse
      situations  which may affect  the  borrowers'  ability  to repay,  and the
      estimated value of any underlying  collateral.  The allowance is increased
      by  provisions  for loan losses  charged  against  income,  and reduced by
      charge-offs, net of recoveries.

      REAL  ESTATE  ACQUIRED IN  SETTLEMENT  OF LOANS:  Real estate  acquired in
      settlement of loans is recorded, on the date acquired, at the lower of the
      Bank's cost or management's estimate of its fair market value.  Subsequent
      adjustments  made to  reflect  any  decline  in value  below  management's
      original estimates are charged to current operations through the provision
      for losses on real estate owned.  Operating  expenses of such  properties,
      related income,  and gains and losses on their disposition are included in
      operations.  The Bank held no real estate  acquired in settlement of loans
      at June 30, 1997 or December 31, 1996.


NOTE 2.  EARNINGS PER SHARE

      Earnings  per share were  computed  using the weighted  average  number of
      common and common equivalent shares outstanding.  Common equivalent shares
      include  shares  issuable  upon exercise of dilutive  options  outstanding
      determined under the treasury stock method.  The Corporation  accounts for
      the shares  acquired by its ESOP in accordance  with Statement of Position
      93-6 and the shares acquired for its Management  Stock Bonus Plan ("MSBP")
      in a manner  similar to the ESOP shares;  shares  acquired by the ESOP and
      MSBP are not considered in the weighted average shares  outstanding  until
      the shares are  committed  for  allocation  or allocated to an  employee's
      individual account.


                                      7



<PAGE>


NOTE 3  LOANS RECEIVABLE

      Loans receivable at June 30, 1997 and December 31, 1996,  consisted of the
      following:

<TABLE>
<CAPTION>
                                                             (In thousands)
                                                        Jun 30,          Dec 31,
                                                         1997             1996
                                                      ----------       ---------
First mortgage loans:
<S>                                                    <C>             <C>     
      One to four family dwellings                     $ 13,695        $ 13,102
      Multi-family dwellings and
        non-residential property                          1,402           1,409
      Construction                                            8              96
Loans secured by deposits                                   617             616
Non-mortgage loans, consumer
      and commercial                                      5,160           5,283
                                                       --------        --------
TOTAL LOANS                                              20,882          20,506

Less:
      Allowance for losses                                 (307)           (303)
      Net deferred loan fees and
            reserve for uncollected
            interest                                        (21)            (23)
                                                       --------        --------


LOANS RECEIVABLE, NET                                  $ 20,554        $ 20,180
                                                       --------        --------


Non-accruing loans at June 30
      and December 31 were
      as follows:                                      $     89        $     53
                                                       --------        --------
</TABLE>


      In accordance  with the  provisions of FASB 114,  "Accounting by Creditors
      for  Impairment  of a Loan," and FASB 118,  "Accounting  by Creditors  for
      Impairment  of a Loan -  Income  Recognition  and  Disclosures,"  the Bank
      measures impaired loans on the present value of expected future cash flows
      discounted  at the  loan's  effective  interest  rate or,  as a  practical
      expedient,  at the loan's observable market price or the fair market value
      of the  collateral if the loan is  collateral  dependent.  Management  has
      evaluated the loan  portfolio and has  determined  that no impaired  loans
      existed at June 30, 1997 or December 31, 1996.

                                       8

<PAGE>


BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION
Item 2. - Management's Discussion and Analysis of Financial
          Condition and Results of Operations

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

Total Assets decreased by $1.0 million,  or 2.2%, from $46.0 million at December
31,  1996 to $45.0  million  at June  30,  1997.  This  decrease  was  primarily
attributable  to the  maturities of investment  securities  and the repayment of
short-term borrowings.

Cash and Cash Equivalents  increased $0.1 million, or 7.7%, from $1.3 million at
December 31, 1996 to $1.4 million at June 30, 1997.

Investment  Securities decreased by $1.2 million, or 17.1%, from $7.0 million at
December  31,  1996  to $5.8  million  at  June  30,  1997.  This  decrease  was
attributable  to the  maturities of a $6.5 million in  securities  and partially
offset by the  purchases of $5.0 million in  securities  and an increase of $0.3
million in the market value of securities classified as available-for-sale.

Collateralized   Mortgage  Obligations  and  Other  Mortgage-Backed   Securities
decreased  $0.2  million,  or 1.2%,  from $16.5  million at December 31, 1996 to
$16.3  million at June 30, 1997.  This  decrease was  primarily due to principal
repayments on the securities.

Loans Receivable increased $0.4 million, or 2.0%, from $20.2 million at December
31, 1996 to $20.6  million at June 30, 1997.  This  increase was  primarily  the
result of $3.8 million in mortgage and non-mortgage loan originations  partially
offset  by  principal  repayments  of $3.4  million.  Management  increased  the
allowance  for  losses on loans by $4,000  during  the  quarter.  There  were no
charge-offs  during the  quarter.  The increase in the  allowance  for losses on
loans is further  discussed in "Management's  Discussion and Analysis of Results
of Operations - Provision for Losses on Loans."

Total  Liabilities  decreased  $1.3  million,  or 3.7%,  from  $34.7  million at
December 31, 1996 to $33.4 million at June 30, 1997. This decrease was primarily
due to a $2.0 million  decrease in  short-term  borrowings  which was  partially
offset by a $0.5 million increase in deposit account balances and a $0.2 million
increase in deferred income taxes and other accrued expenses.

Deposit Accounts increased $0.5 million, or 1.6%, from $32.2 million at December
31, 1996 to $32.7  million at June 30,  1997.  This  increase  was the result of
customer deposits in excess of customer  withdrawals and interest being credited
to customer deposit accounts.

Short-term borrowings decreased $2.0 million, or 100%, to zero at June 30, 1997.
This decrease resulted from the maturities of such borrowings.

                                       9

<PAGE>

BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 2. - (Continued)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION (Continued)

Stockholders'  Equity  increased  $0.3 million,  or 2.7%,  from $11.3 million at
December 31, 1996 to $11.6 million at June 30, 1997. This increase was primarily
due to net  income  of  $157,000  and a net  increase  in the  market  value  of
securities  classified as available-  for-sale of $223,000  which were partially
offset by the payment of regular and special cash dividends on February 18, 1997
of $129,000.

MANAGEMENT'S  DISCUSSION  AND  ANALYSIS OF RESULTS OF  OPERATIONS  FOR THE THREE
MONTHS ENDED JUNE 30, 1997

Net income for the three month period ended June 30, 1997 decreased $30,000,  or
31.9% from $94,000 for the same period in 1996 to $64,000 in 1997. This increase
was  primarily  due to an increase in  non-interest  expense which was partially
offset by  increases  in net  interest  income  and  non-interest  income  and a
decrease in the provision for income taxes.

Interest  income  for the three  month  period  ended  June 30,  1997  increased
$27,000, or 3.6%, from $756,000 for the same period in 1996 to $783,000 in 1997.
This increase was the result of increased  interest  income on loans of $51,000.
This  increase  was  partially  offset  by a  decreases  in  interest  income on
collateralized  mortgage  obligations  and other  mortgage-backed  securities of
$19,000 and in interest income on investment securities of $5,000. The increases
and decreases in the separate  components of interest  income were primarily the
result of changes in the average  balances of the  investments  relating to each
component.

Interest  expense  for the three  month  period  ended June 30,  1997  increased
$25,000, or 7.5%, from $333,000 for the same period in 1996 to $358,000 in 1997.
This increase was primarily due to interest  expense paid on deposit accounts of
$26,000 as a result of a general market  increase in the average  interest rates
paid on deposit accounts.

Net interest  income for the three month  period  ended June 30, 1997  increased
$2,000,  or 0.5%, from $423,000 for the same period in 1996 to $425,000 in 1997.
This increase was primarily due to a $27,000  increase in interest  income which
was partially offset by a $25,000 increase in interest expense.

                                       10

<PAGE>


BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 2. - (Continued)

MANAGEMENT'S  DISCUSSION  AND  ANALYSIS OF RESULTS OF  OPERATIONS  FOR THE THREE
MONTHS ENDED JUNE 30, 1997 (Continued)

Provision  for loan losses was  increased  by $2,000 for the three month  period
ended June 30,  1997  compared  to an  increase of $5,000 for the same period in
1996.  Management's  periodic  evaluation  of the adequacy of the  allowance for
losses on loans, which included an evaluation of each delinquent loan, past loan
loss experience,  current economic conditions, volume, growth and composition of
the loan portfolio and other relevant  factors,  at June 30, 1997 indicated that
the  allowance  should be increased by $2,000.  As indicated by the  evaluation,
management  increased the allowance for losses on loans primarily to reflect the
inherent risk  associated  with the growth in the  non-mortgage  loan portfolio.
Although,  at June 30, 1997,  management  believed the allowance to be adequate,
there can be no assurances that further  additions will not be made and that any
losses that may occur will not exceed the amount provided by the allowance.

Non-interest  income for the three month  period  ended June 30, 1997  increased
$4,000,  or 25%,  from  $16,000  for the same period in 1996 to $20,000 in 1997.
This  increase was  primarily  due to  increases in service  charges and fees on
deposit accounts.

Non-interest  expense for the three month period  ended June 30, 1997  increased
$57,000,  or 20.3%,  from  $281,000  for the same  period in 1996 to $338,000 in
1997. This increase was primarily due to increases in other non-interest expense
of $62,000 and in salaries  and  employee  benefits of $6,000.  The  increase in
other non-interest expense was primarily  attributable to approximately  $69,000
in  professional  fees paid in connection with the proposed merger (See Part II,
Item 5). These increases were partially  offset by a $14,000,  or 73.7% decrease
in federal deposit insurance premiums.

Income tax  expense  for the three month  period  ended June 30, 1997  decreased
$18,000,  or 30.5%, from $59,000 for the same period in 1996 to $41,000 in 1997.
This decrease is primarily the result of an decrease in taxable income.

                                       11

<PAGE>

BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 2. - (Continued)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS FOR THE SIX MONTHS
ENDED JUNE 30, 1997

Net Income for the six month period ended June 30, 1997  decreased  $23,000,  or
12.8%  from  $180,000  for the same  period in 1996 to  $157,000  in 1997.  This
decrease was primarily due to a $52,000  increase in non-interest  expense which
was  partially  offset by an  increase  in  non-interest  income of $6,000 and a
$19,000 decrease in the provision for income taxes.

Interest Income for the six month period ended June 30, 1997 increased  $43,000,
or 2.8%, to $1.57  million from $1.53 million for the same period in 1996.  This
was primarily due to changes in the composition of interest earning assets which
produced higher yields. Interest income on loans increased $107,000 and interest
income  on  collateralized   mortgage  obligations  and  other   mortgage-backed
securities  decreased  $46,000.  Interest income from investment  securities and
interest-bearing deposit accounts decreased $12,000 and $7,000, respectively.

Interest Expense for the six month period ended June 30, 1997 increased $55,000,
or 8.3%, to $720,000 from $665,000 for the same period in 1996. The increase was
due to an  increase  in the  general  level of  interest  rates  paid on deposit
accounts and increased interest expense on short-term borrowings.

Net  Interest  Income for the six month  period  ended June 30,  1997  decreased
$12,000,  or 1.4%, to $852,000  from $864,000 for the same period in 1996.  This
was due to a $55,000 increase in interest expense  partially offset by a $43,000
increase in interest income.

Provision for Loan Losses was increased by $4,000 for the six month period ended
June 30,  1997  compared  to an increase of $20,000 for the same period in 1996.
Management's  periodic evaluation of the adequacy of the allowance for losses on
loans,  which  included an evaluation of each  delinquent  loan,  past loan loss
experience,  current economic conditions,  volume, growth and composition of the
loan portfolio and other relevant  factors,  at June 30, 1997 and March 31, 1997
indicated that the allowance should be increased by $2,000 at the end of each of
the two  quarters.  As indicated by the  evaluation,  management  increased  the
allowance for losses on loans  primarily to reflect the inherent risk associated
with the growth in the non-mortgage loan portfolio.  Although, at June 30, 1997,
management  believed the  allowance to be adequate,  there can be no  assurances
that further  additions will not be made and that any losses that may occur will
not exceed the amount provided by the allowance.

                                       12

<PAGE>


BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 2. - (Continued)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS FOR THE SIX MONTHS
ENDED JUNE 30, 1997 (Continued)

Non-Interest  Income  for the six month  period  ended June 30,  1997  increased
$6,000,  or 19.4%,  to $37,000  from  $31,000 for the same period in 1996.  This
increase  was the result of  increases  in service  charges  and fees on deposit
accounts.

Non-Interest  Expense for the six month  period  ended June 30,  1997  increased
$52,000, or 9.0%, from $581,000 for the same period in 1996 to $633,000 in 1997.
This  increase was  primarily  due to a $72,000  increase in other  non-interest
expense and a $7,000 increase in salaries and employee benefits. The increase in
other non-interest expense was primarily  attributable to approximately  $72,000
in  professional  fees paid in connection with the proposed merger (See Part II,
Item 5). These increases were partially  offset by a $28,000 decrease in federal
deposit insurance premiums.

Income  tax  expense  for the six month  period  ended June 30,  1997  decreased
$19,000, or 16.7%, from $114,000 for the same period in 1996 to $95,000 in 1997.
This  decrease is  primarily  the result of an decrease  in taxable  income.  No
provision  for deferred  taxes has been  recorded for the six month period ended
June 30, 1997 due to immateriality.


LIQUIDITY AND CAPITAL RESOURCES

The Savings Bank is required to maintain  minimum  levels of liquid  assets,  as
defined by the Office of Thrift Supervision (OTS) regulations. This requirement,
which may be varied from time to time  depending  upon economic  conditions  and
deposit flows, is based upon a percentage of deposits and short-term borrowings.
The required  minimum ratio is currently 5%. The Savings Bank's  liquidity ratio
averaged 16.9% during June,  1997. The Savings Bank manages its liquidity  ratio
to meet its funding needs, including: deposit outflows; disbursement of payments
collected  from   borrowers  for  taxes  and   insurance;   and  loan  principal
disbursements.  The Savings  Bank also manages its  liquidity  ratio to meet its
asset and liability management objectives.

In addition to funds  provided  from  operations,  the  Savings  Bank's  primary
sources  of funds  are:  savings  deposits;  principal  repayments  on loans and
mortgage-backed  and  related  securities;  and  matured  or  called  investment
securities.  If necessary, the Savings Bank has the ability to borrow funds from
the Federal Home Loan Bank of Pittsburgh, although the need is not anticipated.

                                       13

<PAGE>

BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 2. - (Continued)

LIQUIDITY AND CAPITAL RESOURCES (Continued)

Scheduled loan  repayments and maturing  investment  securities are a relatively
predictable source of funds.  However,  savings deposit flows and prepayments on
loans and mortgage-backed and related securities are significantly influenced by
changes in market interest rates,  economic  conditions,  and  competition.  The
Savings  Bank  strives  to manage  the  pricing of its  deposits  to  maintain a
balanced stream of cash flows  commensurate  with its loan commitments and other
predictable funding needs.

The Savings  Bank  invests its excess  funds in an  interest  bearing  overnight
deposit  account with the Federal Home Loan Bank of  Pittsburgh.  This  provides
sufficient  liquidity to meet immediate loan  commitment and savings  withdrawal
funding requirements. When applicable, cash in excess of immediate funding needs
is  invested  into  longer-term  investments  and  mortgage-backed  and  related
securities  which typically earn a higher yield than overnight  deposits.  These
types of investments may qualify as liquid  investments  under OTS  regulations,
depending upon their stated maturities.

The Savings Bank  anticipates  that it will have  sufficient  funds available to
meet its current loan  commitments and normal savings  withdrawals.  At June 30,
1997 the Savings Bank had outstanding loan commitments of $31,000.  In addition,
it had  certificates  of deposit  scheduled  to mature  within one year of $16.0
million.  Management  believes that a substantial  portion of such deposits will
remain with the Savings Bank.

As required by the Financial  Institutions Reform,  Recovery and Enforcement Act
of 1989  (FIRREA),  the  Office of Thrift  Supervision  (OTS)  prescribed  three
separate  standards  of capital  adequacy.  The  regulations  require  financial
institutions to have minimum tangible capital equal to 1.50% of tangible assets;
minimum core capital  equal to 3.00% of adjusted  tangible  assets;  and minimum
risk-based capital equal to 8.00% of risk-weighted assets.

                                       14

<PAGE>
BECKLEY BANCORP, INC.
PART I - FINANCIAL INFORMATION, Item 2. - (Continued)

LIQUIDITY AND CAPITAL RESOURCES (Continued)

The following table sets forth the Savings Bank's regulatory capital position at
June 30, 1997, as compared to the minimum regulatory requirements:

                                    Amount        Percent of
                               (in thousands)   Adjusted Assets
                               --------------   ---------------
Tangible Capital:1
      Actual                        $7,715           17.46%
      Required                         663            1.50%
                                    ------           ------
      Excess                        $7,052           15.96%
                                    ------           ------

Core Capital:1
      Actual                        $7,715           17.46%
      Required                       1,325            3.00%
                                    ------           ------
      Excess                        $6,390           14.46%
                                    ------           ------

Risk-Based Capital:2
      Actual                        $7,954           41.84%
      Required                       1,521            8.00%
                                    ------           ------
      Excess                        $6,433           33.84%
                                    ------           ------

      1 Based on tangible and core assets of $44,176
      2 Based on risk-weighted assets of $19,008

PART II - OTHER INFORMATION

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

(a)   The  Corporation  held its 1997  Annual  Meeting  of  Stockholders  at the
      Raleigh County Armory-Civic  Center located at 200 Armory Drive,  Beckley,
      West Virginia on May 20, 1997 at 10:00 a.m. A total of 480,172 shares,  or
      79.83% of the total shares outstanding, were present in person or by proxy
      at the meeting.

(b)   T. Arnold  Graybeal and Duane K. Sellards were  re-elected as directors of
      the  Corporation  at the 1997  Annual  Meeting.  Robert N. File,  James H.
      Perry, Jr., Ned H. Ragland,  Jr. and Tracy L. Riffe will continue to serve
      as directors of the Corporation.

(c)   The following  proposals were presented to the stockholders and voted upon
      at the 1997 Annual  Meeting.  Each proposal was fully described in a Proxy
      Statement  provided to the  stockholders and filed with the Securities and
      Exchange Commission on April 10, 1997.

                                       15
<PAGE>
(c)   (continued)

1.)   The election of T. Arnold  Graybeal and Duane K.  Sellards as directors of
      the Corporation.

                                   T. Arnold Graybeal         Duane K. Sellards
                                   ------------------         -----------------

                Votes For:             470,172                     470,172
                Votes Withheld:         10,000                      10,000

2.)   The  ratification  of the  appointment  of Mason & Bashaw,  CPAs,  A.C. as
      independent auditors of the Corporation for the fiscal year ended December
      31, 1997.

                                                                % of Votes
                                     # of Votes                    Cast
                                     ----------                 ----------

                Votes For:             470,172                    97.92%
                Votes Against:          10,000                     2.08%
                Abstained:                   0                     0.00%
                Broker Non-votes:            0                     0.00%

      No other items of business were voted upon at the meeting.

(d)   None.

Item 5. - Other Information

      Proposed  Merger  - On May  30,  1997,  the  registrant  entered  into  an
Agreement  and Plan of  Merger  with HB  Acquisition  Company,  a  wholly  owned
subsidiary of Horizon Bancorp, Inc. The Agreement provides that each outstanding
share of common stock of the registrant  shall be acquired for a cash payment of
$25.64 per share. Unless delayed by the registrant,  if the transaction does not
close  before  October 1, 1997,  the price per share will  increase by $0.02 per
month.  The  transaction  is subject to approval by the  appropriate  regulatory
authorities  and the  stockholders  of the registrant  with an expected  closing
during the late third or early fourth quarter of 1997.

                                       16
<PAGE>

Item 6. - Exhibits and Reports on Form 8-K

(a)   None

(b)   On May 22,  1997,  a Form 8-K  (Items 5 and 7) was  filed  disclosing  the
      execution of a  non-binding  letter of intent for the  acquisition  of the
      registrant  by Horizon  Bancorp,  Inc. On June 5, 1997,  a second Form 8-K
      (Items 5 and 7) was filed  disclosing  the  execution of an Agreement  and
      Plan of Merger  dated May 30,  1997  between  HB  Acquisition  Company,  a
      subsidiary of Horizon Bancorp, Inc., and the registrant.

                                       17

<PAGE>

BECKLEY BANCORP, INC.

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.

                                          BECKLEY BANCORP, INC.



Date:  July 22, 1997                      By:   /s/ Duane K. Sellards
      -----------------                         -------------------------------
                                                DUANE K. SELLARDS
                                                President and Chief
                                                Executive Officer


Date:  July 22, 1997                      By:   /s/ Brian K. Pate
      -----------------                         -------------------------------
                                                BRIAN K. PATE
                                                Vice President and Chief
                                                Financial Officer