##### 



FIVE  YEAR CONSOLIDATED FINANCIAL HIGHLIGHTS
 Selected Operations Data:
 Year Ended December 31,(Dollars in thousands, except per share data)
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001Total interest income
    
    $
    60,281
    
    
    
    51,617
    
    
    
    44,937
    
    
    
    42,868
    
    
    
    51,468Total interest expense
    
    
    24,511
    
    
    
    20,993
    
    
    
    20,289
    
    
    
    21,295
    
    
    
    30,444Net interest income
    
    
    35,770
    
    
    
    30,624
    
    
    
    24,648
    
    
    
    21,573
    
    
    
    21,024Provision for loan losses
    
    
    2,674
    
    
    
    2,755
    
    
    
    2,610
    
    
    
    2,376
    
    
    
    1,150Net interest income after provision for loan losses
    
    
    33,096
    
    
    
    27,869
    
    
    
    22,038
    
    
    
    19,197
    
    
    
    19,874Fees and service charges
    
    
    2,719
    
    
    
    2,776
    
    
    
    2,304
    
    
    
    1,723
    
    
    
    1,563Loan servicing fees
    
    
    1,210
    
    
    
    1,169
    
    
    
    998
    
    
    
    715
    
    
    
    470Securities gains (losses), net
    
    
    (21
    )
    
    
    (535
    )
    
    
    1,275
    
    
    
    422
    
    
    
    (671
    )Gain on sales of loans
    
    
    1,853
    
    
    
    1,703
    
    
    
    5,240
    
    
    
    3,077
    
    
    
    2,934Losses in limited partnerships
    
    
    (27
    )
    
    
    (26
    )
    
    
    (243
    )
    
    
    (659
    )
    
    
    (1,311
    )Other non-interest income
    
    
    775
    
    
    
    880
    
    
    
    681
    
    
    
    597
    
    
    
    599Total non-interest income
    
    
    6,509
    
    
    
    5,967
    
    
    
    10,255
    
    
    
    5,875
    
    
    
    3,584Total non-interest expense
    
    
    21,801
    
    
    
    20,162
    
    
    
    19,653
    
    
    
    17,849
    
    
    
    15,749Income tax expense
    
    
    6,736
    
    
    
    4,387
    
    
    
    4,038
    
    
    
    2,099
    
    
    
    2,634Income before minority interest
    
    
    11,068
    
    
    
    9,287
    
    
    
    8,602
    
    
    
    5,124
    
    
    
    5,075Minority interest
    
    
    0
    
    
    
    (3
    )
    
    
    (3
    )
    
    
    (142
    )
    
    
    (383
    )Net income
    
    $
    11,068
    
    
    
    9,290
    
    
    
    8,605
    
    
    
    5,266
    
    
    
    5,458Per common share and common share equivalents:Basic
    
    $
    2.89
    
    
    
    2.40
    
    
    
    2.26
    
    
    
    1.40
    
    
    
    1.45Diluted
    
    
    2.77
    
    
    
    2.31
    
    
    
    2.16
    
    
    
    1.32
    
    
    
    1.37
 Selected Financial Condition Data:
 December 31,(Dollars in thousands, except per share data)
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001Total assets
    
    $
    991,237
    
    
    
    960,673
    
    
    
    866,726
    
    
    
    737,523
    
    
    
    721,114Securities available for sale
    
    
    119,659
    
    
    
    103,672
    
    
    
    104,664
    
    
    
    121,397
    
    
    
    119,895Loans held for sale
    
    
    1,435
    
    
    
    2,712
    
    
    
    6,543
    
    
    
    15,127
    
    
    
    68,018Loans receivable, net
    
    
    785,678
    
    
    
    783,213
    
    
    
    688,951
    
    
    
    533,906
    
    
    
    471,668Deposits
    
    
    731,537
    
    
    
    698,902
    
    
    
    551,688
    
    
    
    432,951
    
    
    
    421,843Federal Home Loan Bank advances
    
    
    160,900
    
    
    
    170,900
    
    
    
    203,900
    
    
    
    218,300
    
    
    
    217,800Stockholders equity
    
    
    90,728
    
    
    
    83,771
    
    
    
    80,931
    
    
    
    76,065
    
    
    
    72,161Book value per share
    
    
    20.59
    
    
    
    18.95
    
    
    
    17.93
    
    
    
    17.28
    
    
    
    16.41Number of full service offices
    
    
    13
    
    
    
    13
    
    
    
    12
    
    
    
    13
    
    
    
    12Number of loan origination offices
    
    
    3
    
    
    
    2
    
    
    
    6
    
    
    
    2
    
    
    
    1Key Ratios(1)Stockholders equity to total assets at year end
    
    
    9.15
    %
    
    
    8.72
    %
    
    
    9.34
    %
    
    
    10.31
    %
    
    
    10.01
    %Average stockholders equity to average assets
    
    
    9.05
    
    
    
    9.17
    
    
    
    10.15
    
    
    
    10.66
    
    
    
    9.91Return on stockholders equity     
(ratio of net income to average equity)
    
    
    12.42
    
    
    
    11.03
    
    
    
    10.85
    
    
    
    6.94
    
    
    
    7.57Return on assets     
(ratio of net income to average assets)
    
    
    1.12
    
    
    
    1.01
    
    
    
    1.10
    
    
    
    0.74
    
    
    
    0.75Dividend payout ratio     
(ratio of dividends paid to net income)
    
    
    38.02
    
    
    
    36.36
    
    
    
    39.58
    
    
    
    57.63
    
    
    
    39.71
 
 (1) 
Average balances were calculated based upon amortized cost without the market
value impact of SFAS No. 115. 5




---



##### 



MANAGEMENTS DISCUSSION AND ANALYSIS
 This Annual Report, other reports filed by the
Company with the Securities and Exchange Commission,
and the Companys proxy statement may contain
forward-looking statements that deal with future
results, plans
or performance. In addition, the Companys management
may make such statements orally to the media, or to
securities analysts, investors or others.
Forward-looking statements deal with matters that do
not relate strictly to historical facts. Words such as
anticipate, believe, expect, intend, would,
could and similar expressions, as they relate to us,
are intended to identify such forward-looking
statements. The Companys future results may differ
materially from historical performance and
forward-looking statements about the Companys expected
financial results or other plans are subject to a
number of risks and uncertainties. These include but
are not limited to possible legislative changes and
adverse economic, business and competitive developments
such as shrinking interest margins; deposit outflows;
reduced demand for financial services and loan
products; changes in accounting policies and
guidelines, or monetary and fiscal policies of the
federal government; changes in credit and other risks
posed by the Companys loan and investment portfolios;
changes in loan repayment and prepayment patterns;
changes in loan terms and conditions; technological,
computer-related or operational difficulties; adverse
changes in securities markets; results of litigation or
other significant uncertainties.
 OVERVIEW
   Critical Accounting Policies
  Allowance for Loan Losses and Related Provision
   6




---



##### 



Mortgage Servicing Rights
  Income Taxes
  Results of Operations
   Net Interest Income
  7




---



##### 



MANAGEMENTS DISCUSSION AND ANALYSIS
   Year Ended December 31,2005
    
    
    2004
    
    
    2003Average
    
    
    Interest
    
    
    Average
    
    
    Average
    
    
    Interest
    
    
    Average
    
    
    Average
    
    
    Interest
    
    
    AverageOutstanding
    
    
    Earned/
    
    
    Yield/
    
    
    Outstanding
    
    
    Earned/
    
    
    Yield/
    
    
    Outstanding
    
    
    Earned/
    
    
    Yield/(Dollars in thousands)
    
    Balance
    
    
    Paid
    
    
    Rate
    
    
    Balance
    
    
    Paid
    
    
    Rate
    
    
    Balance
    
    
    Paid
    
    
    RateInterest-earning assets:Securities available for sale:Mortgage-backed and
related securities
    
    $
    8,509
    
    
    
    326
    
    
    
    3.83
    %
    
    $
    11,225
    
    
    
    385
    
    
    
    3.43
    %
    
    $
    21,885
    
    
    
    272
    
    
    
    1.24
    %Other marketable securities
    
    
    95,193
    
    
    
    2,744
    
    
    
    2.88
    
    
    
    97,508
    
    
    
    2,898
    
    
    
    2.97
    
    
    
    74,487
    
    
    
    2,387
    
    
    
    3.20Loans held for sale
    
    
    3,308
    
    
    
    189
    
    
    
    5.71
    
    
    
    4,349
    
    
    
    249
    
    
    
    5.73
    
    
    
    12,899
    
    
    
    748
    
    
    
    5.80Loans receivable, net(1)(2)
    
    
    802,637
    
    
    
    56,189
    
    
    
    7.00
    
    
    
    732,638
    
    
    
    47,714
    
    
    
    6.51
    
    
    
    602,653
    
    
    
    41,052
    
    
    
    6.81Federal Home Loan Bank stock
    
    
    8,960
    
    
    
    253
    
    
    
    2.82
    
    
    
    9,889
    
    
    
    207
    
    
    
    2.10
    
    
    
    11,464
    
    
    
    349
    
    
    
    3.04Other, including
cash equivalents
    
    
    21,714
    
    
    
    580
    
    
    
    2.67
    
    
    
    18,954
    
    
    
    164
    
    
    
    0.87
    
    
    
    20,503
    
    
    
    129
    
    
    
    0.63Total interest-earning assets
    
    $
    940,321
    
    
    
    60,281
    
    
    
    6.41
    
    
    $
    874,563
    
    
    
    51,617
    
    
    
    5.90
    
    
    $
    743,891
    
    
    
    44,937
    
    
    
    6.04Interest-bearing liabilities:Noninterest checking
    
    $
    45,263
    
    
    
    0
    
    
    
    0.00
    %
    
    $
    38,862
    
    
    
    0
    
    
    
    0.00
    %
    
    $
    28,964
    
    
    
    0
    
    
    
    0.00
    %NOW accounts
    
    
    104,271
    
    
    
    1,770
    
    
    
    1.70
    
    
    
    88,559
    
    
    
    638
    
    
    
    0.72
    
    
    
    46,277
    
    
    
    120
    
    
    
    0.26Passbooks
    
    
    48,297
    
    
    
    435
    
    
    
    0.90
    
    
    
    43,186
    
    
    
    77
    
    
    
    0.18
    
    
    
    38,201
    
    
    
    91
    
    
    
    0.24Money market accounts
    
    
    106,819
    
    
    
    2,273
    
    
    
    2.13
    
    
    
    106,943
    
    
    
    1,519
    
    
    
    1.42
    
    
    
    73,800
    
    
    
    878
    
    
    
    1.19Certificate accounts
    
    
    411,034
    
    
    
    12,753
    
    
    
    3.10
    
    
    
    354,811
    
    
    
    10,163
    
    
    
    2.86
    
    
    
    286,238
    
    
    
    9,185
    
    
    
    3.21Federal Home Loan
Bank advances
    
    
    170,914
    
    
    
    7,278
    
    
    
    4.26
    
    
    
    196,662
    
    
    
    8,595
    
    
    
    4.37
    
    
    
    221,503
    
    
    
    10,015
    
    
    
    4.52Other interest-bearing liabilities
    
    
    866
    
    
    
    2
    
    
    
    0.00
    
    
    
    905
    
    
    
    1
    
    
    
    0.00
    
    
    
    2,556
    
    
    
    0
    
    
    
    0.00Total interest-bearing liabilities
    
    $
    887,464
    
    
    
    24,511
    
    
    
    2.76
    
    
    $
    829,928
    
    
    
    20,993
    
    
    
    2.53
    
    
    $
    697,539
    
    
    
    20,289
    
    
    
    2.91Net interest income
    
    
    
    
    
    
    35,770
    
    
    
    
    
    
    
    
    
    
    
    30,624
    
    
    
    
    
    
    
    
    
    
    
    24,648Net interest rate spread
    
    
    
    
    
    
    
    
    
    
    3.65
    %
    
    
    
    
    
    
    
    
    
    
    3.37
    %
    
    
    
    
    
    
    
    
    
    
    3.13
    %Net earning assets
    
    $
    52,857
    
    
    
    
    
    
    
    
    
    
    $
    44,635
    
    
    
    
    
    
    
    
    
    
    $
    46,352Net interest margin
    
    
    
    
    
    
    
    
    
    
    3.80
    %
    
    
    
    
    
    
    
    
    
    
    3.50
    %
    
    
    
    
    
    
    
    
    
    
    3.31
    %Average interest-earning assets to
average interest-bearing
liabilities
    
    
    
    
    
    
    105.96
    %
    
    
    
    
    
    
    
    
    
    
    105.38
    %
    
    
    
    
    
    
    
    
    
    
    106.65
    %
 
 (1)
    
    Tax exempt income was not significant; therefore, the yield was not presented on
a tax equivalent basis for any of the years presented. The tax-exempt income was $1,112,000 for
2005, $1,000,300 for 2004 and $837,343 for 2003.(2)
    
    Calculated net of deferred loan fees, loan discounts, loans in process and loss
reserve. 8




---



##### 



Year Ended December 31,2005 vs. 2004
    
    
    
    
    
    
    2004 vs. 2003Increase (Decrease)
    
    
    Total
    
    
    Increase (Decrease)
    
    
    TotalDue to
    
    
    Increase
    
    
    Due to
    
    
    Increase(Dollars in thousands)
    
    Volume(1)
    
    
    Rate(1)
    
    
    (Decrease)
    
    
    Volume(1)
    
    
    Rate(1)
    
    
    (Decrease)Interest-earning assets:Securities available for sale:Mortgage-backed and related securities
    
    $
    (100
    )
    
    
    41
    
    
    
    (59
    )
    
    $
    (184
    )
    
    
    297
    
    
    
    113Other marketable securities
    
    
    (69
    )
    
    
    (85
    )
    
    
    (154
    )
    
    
    782
    
    
    
    (271
    )
    
    
    511Loans held for sale
    
    
    (60
    )
    
    
    0
    
    
    
    (60
    )
    
    
    (489
    )
    
    
    (10
    )
    
    
    (499
    )Loans receivable, net
    
    
    5,099
    
    
    
    3,376
    
    
    
    8,475
    
    
    
    8,947
    
    
    
    (2,286
    )
    
    
    6,661Cash equivalents
    
    
    27
    
    
    
    389
    
    
    
    416
    
    
    
    (11
    )
    
    
    46
    
    
    
    35Other
    
    
    (20
    )
    
    
    67
    
    
    
    47
    
    
    
    (43
    )
    
    
    (99
    )
    
    
    (142
    )Total interest-earning assets
    
    $
    4,877
    
    
    
    3,788
    
    
    
    8,665
    
    
    $
    9,002
    
    
    
    (2,323
    )
    
    
    6,679Interest-bearing liabilities:NOW accounts
    
    $
    241
    
    
    
    891
    
    
    
    1,132
    
    
    $
    231
    
    
    
    286
    
    
    
    517Passbooks
    
    
    10
    
    
    
    348
    
    
    
    358
    
    
    
    13
    
    
    
    (26
    )
    
    
    (13
    )Money market accounts
    
    
    93
    
    
    
    662
    
    
    
    755
    
    
    
    474
    
    
    
    168
    
    
    
    642Certificates
    
    
    1,936
    
    
    
    653
    
    
    
    2,589
    
    
    
    2,454
    
    
    
    (1,478
    )
    
    
    976Federal Home Loan Bank advances
    
    
    (1,148
    )
    
    
    (169
    )
    
    
    (1,317
    )
    
    
    (1,094
    )
    
    
    (326
    )
    
    
    (1,420
    )Other interest-bearing liabilities
    
    
    0
    
    
    
    2
    
    
    
    2
    
    
    
    0
    
    
    
    1
    
    
    
    1Total interest-bearing liabilities
    
    $
    1,132
    
    
    
    2,387
    
    
    
    3,519
    
    
    $
    2,078
    
    
    
    (1,375
    )
    
    
    703Net interest income
    
    
    
    
    
    
    
    
    
    $
    35,770
    
    
    
    
    
    
    
    
    
    
    $
    30,624
 
 (1)
    
    For purposes of this table, changes attributable to both rate and
volume which cannot be segregated have been allocated proportionately to the change
due to volume and the change due to rate. 9




---



##### 



MANAGEMENTS DISCUSSION AND ANALYSIS
  At December 31, 2005
 Weighted average yield on:Securities available for sale:Mortgage-backed and related securities
    
    
    3.75
    %Other marketable securities
    
    
    3.27Loans held for sale
    
    
    5.87Loans receivable, net
    
    
    7.33Cash equivalents
    
    
    3.66Other
    
    
    2.80Combined weighted average yield on
interest-earning assets
    
    
    6.47Weighted average rate on:NOW accounts
    
    
    2.07
    %Passbooks
    
    
    2.04Money market accounts
    
    
    2.59Certificates
    
    
    3.40Federal Home Loan Bank advances
    
    
    4.29Combined weighted average rate on
interest-bearing liabilities
    
    
    2.97Interest rate spread
    
    
    3.50
 Provision For Loan Losses
  Non-Interest Income
  PercentageYear Ended December 31,
    
    Increase (Decrease)(Dollars in thousands)
    
    2005
    
    
    2004
    
    
    2003
    
    
    2005/2004
    
    
    2004/2003Fees and service charges
    
    $
    2,719
    
    
    
    2,776
    
    
    
    2,304
    
    
    
    (2.1
    )%
    
    
    20.5
    %Loan servicing fees
    
    
    1,210
    
    
    
    1,169
    
    
    
    998
    
    
    
    3.5
    
    
    
    17.1Securities gains (losses), net
    
    
    (21
    )
    
    
    (535
    )
    
    
    1,275
    
    
    
    96.1
    
    
    
    (142.0
    )Gain on sales of loans
    
    
    1,853
    
    
    
    1,703
    
    
    
    5,240
    
    
    
    8.8
    
    
    
    (67.5
    )Losses in limited partnerships
    
    
    (27
    )
    
    
    (26
    )
    
    
    (243
    )
    
    
    (3.8
    )
    
    
    89.3Other non-interest income
    
    
    775
    
    
    
    880
    
    
    
    681
    
    
    
    (11.9
    )
    
    
    29.2Total non-interest income
    
    $
    6,509
    
    
    
    5,967
    
    
    
    10,255
    
    
    
    9.1
    
    
    
    (41.8
    )
 10




---



##### 



Non-Interest Expense
  PercentageYear Ended December 31,
    
    
    Increase (Decrease)(Dollars in thousands)
    
    2005
    
    
    2004
    
    
    2003
    
    
    2005/2004
    
    
    2004/2003Compensation and benefits
    
    $
    11,140
    
    
    
    10,187
    
    
    
    8,676
    
    
    
    9.4
    %
    
    
    17.4
    %Occupancy
    
    
    4,081
    
    
    
    3,630
    
    
    
    3,424
    
    
    
    12.4
    
    
    
    6.0Deposit insurance premiums
    
    
    130
    
    
    
    96
    
    
    
    72
    
    
    
    35.4
    
    
    
    33.3Advertising
    
    
    384
    
    
    
    430
    
    
    
    393
    
    
    
    (10.7
    )
    
    
    9.4Data processing
    
    
    1,032
    
    
    
    930
    
    
    
    1,109
    
    
    
    11.0
    
    
    
    (16.1
    )Amortization of mortgage servicing rights, net
    
    
    1,020
    
    
    
    1,061
    
    
    
    1,982
    
    
    
    (3.9
    )
    
    
    (46.5
    )Other
    
    
    4,014
    
    
    
    3,828
    
    
    
    3,997
    
    
    
    4.9
    
    
    
    (4.2
    )Total non-interest expense
    
    $
    21,801
    
    
    
    20,162
    
    
    
    19,653
    
    
    
    8.1
    
    
    
    2.6
 11




---



##### 



MANAGEMENTS
DISCUSSION AND ANALYSIS
  Income Taxes
  COMPARISON OF 2004 WITH 2003
     12




---



##### 



13




---



##### 



MANAGEMENTS
DISCUSSION AND ANALYSIS
 Financial
Condition
 Loans Receivable, Net
  December 31,2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001(Dollars in thousands)
    
    Amount
    
    
    Percent
    
    
    Amount
    
    
    Percent
    
    
    Amount
    
    
    Percent
    
    
    Amount
    
    
    Percent
    
    
    Amount
    
    
    PercentReal Estate Loans:One-to-four family
    
    $
    127,075
    
    
    
    15.82
    %
    
    $
    139,008
    
    
    
    17.34
    %
    
    $
    144,315
    
    
    
    20.37
    %
    
    $
    151,566
    
    
    
    27.72
    %
    
    $
    215,448
    
    
    
    44.73
    %Multi-family
    
    
    40,753
    
    
    
    5.07
    
    
    
    41,922
    
    
    
    5.23
    
    
    
    31,540
    
    
    
    4.45
    
    
    
    15,766
    
    
    
    2.88
    
    
    
    14,369
    
    
    
    2.98Commercial
    
    
    260,268
    
    
    
    32.40
    
    
    
    224,945
    
    
    
    28.06
    
    
    
    199,124
    
    
    
    28.10
    
    
    
    130,417
    
    
    
    23.85
    
    
    
    70,768
    
    
    
    14.69Construction or
development
    
    
    80,342
    
    
    
    10.00
    
    
    
    98,397
    
    
    
    12.28
    
    
    
    95,346
    
    
    
    13.45
    
    
    
    61,336
    
    
    
    11.22
    
    
    
    46,977
    
    
    
    9.75Total real
estate
loans
    
    
    508,438
    
    
    
    63.29
    
    
    
    504,272
    
    
    
    62.91
    
    
    
    470,325
    
    
    
    66.37
    
    
    
    359,085
    
    
    
    65.67
    
    
    
    347,562
    
    
    
    72.15Other Loans:Consumer Loans:Automobile
    
    
    5,461
    
    
    
    0.68
    
    
    
    9,496
    
    
    
    1.18
    
    
    
    14,754
    
    
    
    2.08
    
    
    
    11,062
    
    
    
    2.02
    
    
    
    6,624
    
    
    
    1.38Home equity line
    
    
    61,011
    
    
    
    7.60
    
    
    
    67,140
    
    
    
    8.38
    
    
    
    54,193
    
    
    
    7.64
    
    
    
    52,106
    
    
    
    9.53
    
    
    
    35,714
    
    
    
    7.42Home equity
    
    
    19,076
    
    
    
    2.37
    
    
    
    20,033
    
    
    
    2.50
    
    
    
    18,974
    
    
    
    2.68
    
    
    
    21,075
    
    
    
    3.85
    
    
    
    26,356
    
    
    
    5.47Mobile home
    
    
    2,299
    
    
    
    0.29
    
    
    
    2,896
    
    
    
    0.36
    
    
    
    3,665
    
    
    
    0.52
    
    
    
    4,534
    
    
    
    0.83
    
    
    
    5,456
    
    
    
    1.13Land/lot loans
    
    
    9,487
    
    
    
    1.18
    
    
    
    11,572
    
    
    
    1.44
    
    
    
    10,486
    
    
    
    1.48
    
    
    
    3,590
    
    
    
    0.66
    
    
    
    850
    
    
    
    0.18Other
    
    
    3,564
    
    
    
    0.44
    
    
    
    3,836
    
    
    
    0.48
    
    
    
    3,833
    
    
    
    0.54
    
    
    
    4,054
    
    
    
    0.75
    
    
    
    4,131
    
    
    
    0.86Total consumer
loans
    
    
    100,898
    
    
    
    12.56
    
    
    
    114,973
    
    
    
    14.34
    
    
    
    105,905
    
    
    
    14.94
    
    
    
    96,421
    
    
    
    17.64
    
    
    
    79,131
    
    
    
    16.44Commercial business
loans
    
    
    193,962
    
    
    
    24.15
    
    
    
    182,369
    
    
    
    22.75
    
    
    
    132,459
    
    
    
    18.69
    
    
    
    91,260
    
    
    
    16.69
    
    
    
    54,940
    
    
    
    11.41Total other
loans
    
    
    294,860
    
    
    
    36.71
    
    
    
    297,342
    
    
    
    37.09
    
    
    
    238,364
    
    
    
    33.63
    
    
    
    187,681
    
    
    
    34.33
    
    
    
    134,071
    
    
    
    27.85Total loans
    
    
    803,298
    
    
    
    100.00
    %
    
    
    801,614
    
    
    
    100.00
    %
    
    
    708,689
    
    
    
    100.00
    %
    
    
    546,766
    
    
    
    100.00
    %
    
    
    481,633
    
    
    
    100.00
    %Less:Loans in process
    
    
    7,008
    
    
    
    
    
    
    
    7,561
    
    
    
    
    
    
    
    11,298
    
    
    
    
    
    
    
    6,826
    
    
    
    
    
    
    
    4,692Unamortized
discounts
    
    
    190
    
    
    
    
    
    
    
    63
    
    
    
    
    
    
    
    166
    
    
    
    
    
    
    
    142
    
    
    
    
    
    
    
    278Net deferred
loan fees
    
    
    1,644
    
    
    
    
    
    
    
    1,781
    
    
    
    
    
    
    
    1,334
    
    
    
    
    
    
    
    1,068
    
    
    
    
    
    
    
    1,212Allowance for losses
    
    
    8,778
    
    
    
    
    
    
    
    8,996
    
    
    
    
    
    
    
    6,940
    
    
    
    
    
    
    
    4,824
    
    
    
    
    
    
    
    3,783Total loans
receivable
, net
    
    $
    785,678
    
    
    
    
    
    
    $
    783,213
    
    
    
    
    
    
    $
    688,951
    
    
    
    
    
    
    $
    533,906
    
    
    
    
    
    
    $
    471,668
   14




---



##### 



Allowance for Loan Losses
    December 31,(Dollars in thousands)
    
    2005
    
    
    2004
    
    
    
    2003
    
    2002
    
    
    2001Balance at beginning of year
    
    $
    8,996
    
    
    
    6,940
    
    
    
    4,824
    
    
    
    3,783
    
    
    
    3,144Provision for losses
    
    
    2,674
    
    
    
    2,755
    
    
    
    2,610
    
    
    
    2,376
    
    
    
    1,150Charge-offs:One-to-four family
    
    
    (234
    )
    
    
    (331
    )
    
    
    (69
    )
    
    
    (44
    )
    
    
    0Consumer
    
    
    (228
    )
    
    
    (407
    )
    
    
    (226
    )
    
    
    (310
    )
    
    
    (170
    )Commercial business and real estate
    
    
    (2,615
    )
    
    
    0
    
    
    
    (255
    )
    
    
    (1,015
    )
    
    
    (347
    )Recoveries
    
    
    185
    
    
    
    39
    
    
    
    56
    
    
    
    34
    
    
    
    6Net charge-offs
    
    
    (2,892
    )
    
    
    (699
    )
    
    
    (494
    )
    
    
    (1,335
    )
    
    
    (511
    )Balance at end of year
    
    $
    8,778
    
    
    
    8,996
    
    
    
    6,940
    
    
    
    4,824
    
    
    
    3,783Year end allowance for loan losses as a percent of year end
gross loan balance
    
    
    1.09
    %
    
    
    1.12
    %
    
    
    0.98
    %
    
    
    0.88
    %
    
    
    0.79
    %Ratio of net loan charge-offs to average loans outstanding
    
    
    0.36
    
    
    
    0.09
    
    
    
    0.08
    
    
    
    0.26
    
    
    
    0.10
 15




---



##### 



MANAGEMENTS DISCUSSION AND ANALYSIS
  December 31,2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001Percent
    
    
    
    
    
    
    Percent
    
    
    
    
    
    
    Percent
    
    
    
    
    
    
    Percent
    
    
    
    
    
    
    PercentAllocated
    
    
    of loans
    
    
    Allocated
    
    
    of loans
    
    
    Allocated
    
    
    of loans
    
    
    Allocated
    
    
    of loans
    
    
    Allocated
    
    
    of loansallowance
    
    
    in each
    
    
    allowance
    
    
    in each
    
    
    allowance
    
    
    in each
    
    
    allowance
    
    
    in each
    
    
    allowance
    
    
    in eachas of %
    
    
    category
    
    
    as a %
    
    
    category
    
    
    as a %
    
    
    category
    
    
    as a %
    
    
    category
    
    
    as a %
    
    
    categoryof loan
    
    
    to total
    
    
    of loan
    
    
    to total
    
    
    of loan
    
    
    to total
    
    
    of loan
    
    
    to total
    
    
    of loan
    
    
    to totalcategory
    
    
    loans
    
    
    category
    
    
    loans
    
    
    category
    
    
    loans
    
    
    category
    
    
    loans
    
    
    category
    
    
    loansReal estate
loans:One-to-four family
    
    
    0.21
    %
    
    
    15.82
    %
    
    
    0.17
    %
    
    
    17.34
    %
    
    
    0.12
    %
    
    
    20.36
    %
    
    
    0.06
    %
    
    
    27.72
    %
    
    
    0.10
    %
    
    
    44.73
    %Multi-family
    
    
    1.56
    
    
    
    5.07
    
    
    
    1.67
    
    
    
    5.23
    
    
    
    1.34
    
    
    
    4.45
    
    
    
    1.30
    
    
    
    2.88
    
    
    
    1.41
    
    
    
    2.98Commercial real estate
    
    
    1.32
    
    
    
    32.40
    
    
    
    1.60
    
    
    
    28.06
    
    
    
    1.42
    
    
    
    28.10
    
    
    
    1.55
    
    
    
    23.88
    
    
    
    1.28
    
    
    
    14.69Construction or
development
    
    
    1.14
    
    
    
    10.00
    
    
    
    1.07
    
    
    
    12.28
    
    
    
    0.92
    
    
    
    13.45
    
    
    
    0.97
    
    
    
    11.22
    
    
    
    1.19
    
    
    
    9.75Consumer loans
    
    
    0.88
    
    
    
    12.56
    
    
    
    0.81
    
    
    
    14.34
    
    
    
    0.98
    
    
    
    14.95
    
    
    
    0.56
    
    
    
    17.63
    
    
    
    0.71
    
    
    
    16.44Commercial business loans
    
    
    1.36
    
    
    
    24.15
    
    
    
    1.36
    
    
    
    22.75
    
    
    
    1.20
    
    
    
    18.69
    
    
    
    1.48
    
    
    
    16.67
    
    
    
    2.44
    
    
    
    11.41Total
    
    
    1.09
    %
    
    
    100.00
    %
    
    
    1.12
    %
    
    
    100.00
    %
    
    
    0.98
    %
    
    
    100.00
    %
    
    
    0.88
    %
    
    
    100.00
    %
    
    
    0.79
    %
    
    
    100.00
    %
  Allowance for Real Estate Losses
  Non-performing Assets
    16




---



##### 



December 31,(Dollars in thousands)
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001Non-accruing loans:Real estate:One-to-four family
    
    $
    626
    
    
    
    1,864
    
    
    
    1,177
    
    
    
    695
    
    
    
    771Commercial real estate
    
    
    948
    
    
    
    1,114
    
    
    
    2,162
    
    
    
    1,719
    
    
    
    187Consumer
    
    
    496
    
    
    
    472
    
    
    
    1,050
    
    
    
    495
    
    
    
    311Commercial business
    
    
    259
    
    
    
    261
    
    
    
    186
    
    
    
    427
    
    
    
    890Total
    
    
    2,329
    
    
    
    3,711
    
    
    
    4,575
    
    
    
    3,336
    
    
    
    2,159Accruing loans delinquent 90 days or more:One-to-four family
    
    
    0
    
    
    
    628
    
    
    
    114
    
    
    
    171
    
    
    
    24Other assets
    
    
    178
    
    
    
    201
    
    
    
    211
    
    
    
    866
    
    
    
    1,390Foreclosed and repossessed assets:Real estate:One-to-four family
    
    
    565
    
    
    
    141
    
    
    
    73
    
    
    
    300
    
    
    
    0Commercial real estate
    
    
    750
    
    
    
    0
    
    
    
    0
    
    
    
    127
    
    
    
    0Consumer
    
    
    61
    
    
    
    201
    
    
    
    62
    
    
    
    107
    
    
    
    155Commercial business
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    33Total
    
    
    1,376
    
    
    
    342
    
    
    
    135
    
    
    
    534
    
    
    
    188Total non-performing assets
    
    $
    3,883
    
    
    $
    4,882
    
    
    $
    5,035
    
    
    $
    4,907
    
    
    $
    3,761Total as a percentage of total assets
    
    
    0.39
    %
    
    
    0.51
    %
    
    
    0.58
    %
    
    
    0.67
    %
    
    
    0.52
    %Total non-performing loans
    
    $
    2,329
    
    
    $
    4,339
    
    
    $
    4,689
    
    
    $
    3,507
    
    
    $
    2,183Total as a percentage of total loans receivable, net
    
    
    0.30
    %
    
    
    0.55
    %
    
    
    0.68
    %
    
    
    0.66
    %
    
    
    0.46
    %Allowance for loan losses to non-performing loans
    
    
    376.88
    %
    
    
    207.30
    %
    
    
    147.99
    %
    
    
    134.60
    %
    
    
    173.29
    %
   Liquidity and Capital Resources
    17




---



##### 



MANAGEMENTS DISCUSSION AND ANALYSIS
        Contractual Obligations and Commercial Commitments
  Payments Due by PeriodLess than 1
    
    
    
    
    
    
    
    
    
    
    After 5(Dollars in thousands)
    
    Total
    
    
    Year
    
    
    1-3 Years
    
    
    4-5 Years
    
    
    YearsContractual Obligations:Total borrowings
    
    $
    160,900
    
    
    
    0
    
    
    
    60,000
    
    
    
    10,000
    
    
    
    90,900Annual rental commitments under
non-cancelable operating leases
    
    
    948
    
    
    
    596
    
    
    
    267
    
    
    
    85
    
    
    
    0$
    161,848
    
    
    
    596
    
    
    
    60,267
    
    
    
    10,085
    
    
    
    90,900
 Amount of Commitments-Expiring by PeriodOther Commercial Commitments:Commercial lines of credit
    
    $
    34,323
    
    
    
    27,756
    
    
    
    6,511
    
    
    
    4
    
    
    
    52Commitments to lend
    
    
    69,582
    
    
    
    35,964
    
    
    
    17,668
    
    
    
    2,100
    
    
    
    13,850Standby letters of credit
    
    
    10,158
    
    
    
    7,486
    
    
    
    2,672
    
    
    
    0
    
    
    
    0$
    114,063
    
    
    
    71,206
    
    
    
    26,851
    
    
    
    2,104
    
    
    
    13,902
 18




---



##### 



Regulatory Capital Requirements
  Dividends
  Impact of Inflation and Changing Prices
  New Accounting Pronouncements
 Share-Based Payment Accounting for
Stock-Based Compensation Accounting for Stock
Issued to Employees
 Market  Risk
  Rate Shock
Table
  19




---



##### 



MANAGEMENTS DISCUSSION AND ANALYSIS
   Market Value(Dollars in thousands)Basis point change in interest rates
    
    -200
    
    
    -100
    
    
    0
    
    
    +100
    
    
    +200Total market risk sensitive
assets
    
    $
    999,512
    
    
    
    992,546
    
    
    
    983,307
    
    
    
    970,678
    
    
    
    956,540Total market risk sensitive
liabilities
    
    
    877,150
    
    
    
    861,017
    
    
    
    846,515
    
    
    
    834,032
    
    
    
    823,381Off-balance sheet financial
instruments
    
    
    (16
    )
    
    
    (3
    )
    
    
    0
    
    
    
    102
    
    
    
    191Net market risk
    
    $
    122,378
    
    
    
    131,532
    
    
    
    136,792
    
    
    
    136,544
    
    
    
    132,968Percentage change from current
market value
    
    
    (10.54
    )%
    
    
    (3.85
    )%
    
    
    0.00
    %
    
    
    (0.18
    )%
    
    
    (2.80
    )%
   20




---



##### 



Asset/Liability Management
  Rate Shock
    
    Net Interest
    
    Percentagein Basis Points
    
    Change
    
    Change+200
    
    $
    1,692,000
    
    
    
    4.49
    %+100
    
    $
    1,011,000
    
    
    
    2.68
    %0
    
    
    0
    
    
    
    0.00
    %-100
    
    $
    (2,262,000
    )
    
    
    (6.00
    )%-200
    
    $
    (4,855,000
    )
    
    
    (12.88
    )%
     21




---



##### 



CONSOLIDATED BALANCE SHEETS
 December 31, 2005 and 2004
    
    2005
    
    
    2004ASSETSCash and cash equivalents
    
    $
    47,268,795
    
    
    
    34,298,394Securities available for sale:Mortgage-backed and related securities
(amortized cost $7,428,504 and $9,509,377)
    
    
    6,879,756
    
    
    
    9,150,871Other marketable securities
(amortized cost $113,749,841 and $95,097,051)
    
    
    112,778,813
    
    
    
    94,521,512119,658,569
    
    
    
    103,672,383Loans held for sale
    
    
    1,435,141
    
    
    
    2,711,760Loans receivable, net
    
    
    785,678,461
    
    
    
    783,213,262Accrued interest receivable
    
    
    4,460,014
    
    
    
    3,694,133Real estate, net
    
    
    1,214,621
    
    
    
    140,608Federal Home Loan Bank stock, at cost
    
    
    8,364,600
    
    
    
    9,292,800Mortgage servicing rights, net
    
    
    2,653,635
    
    
    
    3,231,242Premises and equipment, net
    
    
    11,941,863
    
    
    
    12,464,265Investment in limited partnerships
    
    
    141,048
    
    
    
    168,258Goodwill
    
    
    3,800,938
    
    
    
    3,800,938Core deposit intangible, net
    
    
    219,760
    
    
    
    333,617Prepaid expenses and other assets
    
    
    1,854,948
    
    
    
    2,638,681Deferred tax assets
    
    
    2,544,400
    
    
    
    1,012,700Total assets
    
    $
    991,236,793
    
    
    
    960,673,041LIABILITIES AND STOCKHOLDERS EQUITYDeposits
    
    $
    731,536,560
    
    
    
    698,902,185Federal Home Loan Bank advances
    
    
    160,900,000
    
    
    
    170,900,000Accrued interest payable
    
    
    2,085,573
    
    
    
    1,314,356Customer escrows
    
    
    1,038,575
    
    
    
    762,737Accrued expenses and other liabilities
    
    
    4,947,816
    
    
    
    5,022,927Total liabilities
    
    
    900,508,524
    
    
    
    876,902,205Commitments and contingenciesStockholders equity:Serial preferred stock ($.01 par value):Authorized 500,000 shares; issued and outstanding none
    
    
    0
    
    
    
    0Common stock ($.01 par value):Authorized 11,000,000 shares; issued 9,128,662
    
    
    91,287
    
    
    
    91,287Additional paid-in capital
    
    
    58,011,099
    
    
    
    57,875,595Retained earnings, subject to certain restrictions
    
    
    98,951,777
    
    
    
    91,408,028Accumulated other comprehensive loss
    
    
    (917,577
    )
    
    
    (604,446
    )Unearned employee stock ownership plan shares
    
    
    (4,350,999
    )
    
    
    (4,544,300
    )Unearned restricted stock awards
    
    
    (182,521
    )
    
    
    0Treasury stock, at cost 4,721,402 and 4,708,798 shares
    
    
    (60,874,797
    )
    
    
    (60,455,328
    )Total stockholders equity
    
    
    90,728,269
    
    
    
    83,770,836Total liabilities and stockholders equity
    
    $
    991,236,793
    
    
    
    960,673,041
 See accompanying notes to consolidated financial statements.
 22




---



##### 



CONSOLIDATED
STATEMENTS OF INCOME
 Years ended December 31, 2005, 2004 and 2003
    
    2005
    
    
    2004
    
    
    2003Interest income:Loans receivable
    
    $
    56,376,920
    
    
    
    47,962,485
    
    
    
    41,800,039Securities available for sale:Mortgage-backed and related
    
    
    325,940
    
    
    
    385,067
    
    
    
    272,253Other marketable
    
    
    2,744,202
    
    
    
    2,897,834
    
    
    
    2,386,590Cash equivalents
    
    
    580,500
    
    
    
    164,061
    
    
    
    128,948Other
    
    
    253,611
    
    
    
    207,240
    
    
    
    349,150Total interest income
    
    
    60,281,173
    
    
    
    51,616,687
    
    
    
    44,936,980Interest expense:Deposits
    
    
    17,233,400
    
    
    
    12,398,505
    
    
    
    10,274,188Federal Home Loan Bank advances
    
    
    7,278,050
    
    
    
    8,594,790
    
    
    
    10,014,865Total interest expense
    
    
    24,511,450
    
    
    
    20,993,295
    
    
    
    20,289,053Net interest income
    
    
    35,769,723
    
    
    
    30,623,392
    
    
    
    24,647,927Provision for loan losses
    
    
    2,674,000
    
    
    
    2,755,000
    
    
    
    2,610,000Net interest income after provision for
loan losses
    
    
    33,095,723
    
    
    
    27,868,392
    
    
    
    22,037,927Non-interest income:Fees and service charges
    
    
    2,719,004
    
    
    
    2,776,553
    
    
    
    2,304,090Loan servicing fees
    
    
    1,210,192
    
    
    
    1,168,760
    
    
    
    998,200Securities (losses) gains, net
    
    
    (21,000
    )
    
    
    (535,188
    )
    
    
    1,274,537Gain on sales of loans
    
    
    1,852,940
    
    
    
    1,702,979
    
    
    
    5,240,442Losses in limited partnerships
    
    
    (27,210
    )
    
    
    (26,118
    )
    
    
    (243,305
    )Other
    
    
    775,294
    
    
    
    880,233
    
    
    
    681,518Total non-interest income
    
    
    6,509,220
    
    
    
    5,967,219
    
    
    
    10,255,482Non-interest expense:Compensation and benefits
    
    
    11,140,329
    
    
    
    10,186,538
    
    
    
    8,675,596Occupancy
    
    
    4,080,880
    
    
    
    3,629,766
    
    
    
    3,423,745Deposit insurance premiums
    
    
    129,683
    
    
    
    95,465
    
    
    
    72,524Advertising
    
    
    384,184
    
    
    
    430,417
    
    
    
    392,833Data processing
    
    
    1,031,630
    
    
    
    930,144
    
    
    
    1,109,098Amortization of mortgage servicing rights, net
    
    
    1,019,766
    
    
    
    1,061,407
    
    
    
    1,982,337Other
    
    
    4,014,482
    
    
    
    3,828,086
    
    
    
    3,997,243Total noninterest expense
    
    
    21,800,954
    
    
    
    20,161,823
    
    
    
    19,653,376Income before income tax expense
    
    
    17,803,989
    
    
    
    13,673,788
    
    
    
    12,640,033Income tax expense
    
    
    6,736,100
    
    
    
    4,387,100
    
    
    
    4,037,800Income before minority interest
    
    
    11,067,889
    
    
    
    9,286,688
    
    
    
    8,602,233Minority interest
    
    
    0
    
    
    
    (3,109
    )
    
    
    (3,014
    )Net income
    
    $
    11,067,889
    
    
    
    9,289,797
    
    
    
    8,605,247Basic earnings per share
    
    $
    2.89
    
    
    
    2.40
    
    
    
    2.26Diluted earnings per share
    
    $
    2.77
    
    
    
    2.31
    
    
    
    2.16
 See accompanying notes to consolidated financial statements.
 23




---



##### 



CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY AND COMPREHENSIVE INCOME
 UnearnedEmployeeAccumulated
    
    
    Stock
    
    
    UnearnedAdditional
    
    
    
    
    
    
    Other
    
    
    Ownership
    
    
    Compensation
    
    
    
    
    
    
    TotalCommon
    
    
    Paid-In
    
    
    Retained
    
    
    Comprehensive
    
    
    Plan
    
    
    Restricted
    
    
    Treasury
    
    
    StockholdersStock
    
    
    Capital
    
    
    Earnings
    
    
    Income (Loss)
    
    
    Shares
    
    
    Stock Awards
    
    
    Stock
    
    
    EquityBalance, December 31, 2002
    
    $
    91,287
    
    
    
    58,885,279
    
    
    
    79,660,481
    
    
    
    1,575,577
    
    
    
    (4,931,385
    )
    
    
    0
    
    
    
    (59,216,683
    )
    
    
    76,064,556Net income
    
    
    
    
    
    
    
    
    
    
    8,605,247
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,605,247Other comprehensive loss, net of tax:Net unrealized losses on
securities available for sale
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,626,302
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,626,302
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,978,945Treasury stock purchases
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,384,560
    )
    
    
    (1,384,560
    )Employee stock options exercised
    
    
    
    
    
    
    (1,578,979
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,001,439
    
    
    
    1,422,460Tax benefits of exercised stock options
    
    
    
    
    
    
    376,969
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    376,969Earned employee stock ownership
plan shares
    
    
    
    
    
    
    180,457
    
    
    
    
    
    
    
    
    
    
    
    193,301
    
    
    
    
    
    
    
    
    
    
    
    373,758Dividends paid
    
    
    
    
    
    
    
    
    
    
    (2,901,071
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,901,071
    )Balance, December 31, 2003
    
    $
    91,287
    
    
    
    57,863,726
    
    
    
    85,364,657
    
    
    
    (50,725
    )
    
    
    (4,738,084
    )
    
    
    0
    
    
    
    (57,599,804
    )
    
    
    80,931,057Net income
    
    
    
    
    
    
    
    
    
    
    9,289,797
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,289,797Other comprehensive loss, net of tax:Net unrealized losses on
securities available for sale
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (553,721
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (553,721
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,736,076Treasury stock purchases
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,316,550
    )
    
    
    (3,316,550
    )Employee stock options exercised
    
    
    
    
    
    
    (394,392
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    461,026
    
    
    
    66,634Tax benefits of exercised stock options
    
    
    
    
    
    
    98,096
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    98,096Earned employee stock ownership
plan shares
    
    
    
    
    
    
    308,165
    
    
    
    
    
    
    
    
    
    
    
    193,784
    
    
    
    
    
    
    
    
    
    
    
    501,949Dividends paid
    
    
    
    
    
    
    
    
    
    
    (3,246,426
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,246,426
    )Balance, December 31, 2004
    
    $
    91,287
    
    
    
    57,875,595
    
    
    
    91,408,028
    
    
    
    (604,446
    )
    
    
    (4,544,300
    )
    
    
    0
    
    
    
    (60,455,328
    )
    
    
    83,770,836Net income
    
    
    
    
    
    
    
    
    
    
    11,067,889
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,067,889Other comprehensive loss, net of tax:Net unrealized losses on
securities available for sale
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (313,131
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (313,131
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,754,758Treasury stock purchases
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (972,000
    )
    
    
    (972,000
    )Employee stock options exercised
    
    
    
    
    
    
    (247,613
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    285,500
    
    
    
    37,887Tax benefits of exercised stock options
    
    
    
    
    
    
    29,907
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    29,907Unearned compensation restricted
stock awards
    
    
    
    
    
    
    15,616
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (326,528
    )
    
    
    310,912
    
    
    
    0Restricted stock awards forfeited
    
    
    
    
    
    
    (2,204
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    46,085
    
    
    
    (43,881
    )
    
    
    0Amortization of restricted
stock awards
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    97,922
    
    
    
    
    
    
    
    97,922Earned employee stock ownership
plan shares
    
    
    
    
    
    
    339,798
    
    
    
    
    
    
    
    
    
    
    
    193,301
    
    
    
    
    
    
    
    
    
    
    
    533,099Dividends paid
    
    
    
    
    
    
    
    
    
    
    (3,524,140
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,524,140
    )Balance, December 31, 2005
    
    $
    91,287
    
    
    
    58,011,099
    
    
    
    98,951,777
    
    
    
    (917,577
    )
    
    
    (4,350,999
    )
    
    
    (182,521
    )
    
    
    (60,874,797
    )
    
    
    90,728,269
 See accompanying notes to consolidated financial statements.
 24




---



##### 



CONSOLIDATED STATEMENTS OF CASH FLOWS
 Years ended December 31, 2005, 2004 and 2003
    
    2005
    
    
    2004
    
    
    2003Cash flows from operating activities:Net income
    
    $
    11,067,889
    
    
    
    9,289,797
    
    
    
    8,605,247Adjustments to reconcile net income to cash provided by operating activities:Provision for loan losses
    
    
    2,674,000
    
    
    
    2,755,000
    
    
    
    2,610,000Depreciation
    
    
    1,750,953
    
    
    
    1,596,252
    
    
    
    1,549,997Amortization of (discounts) premiums, net
    
    
    (849,539
    )
    
    
    (353,598
    )
    
    
    652,344Amortization of deferred loan fees
    
    
    (1,071,078
    )
    
    
    (1,166,855
    )
    
    
    (690,176
    )Amortization of core deposit intangible
    
    
    113,857
    
    
    
    113,857
    
    
    
    113,857Amortization of mortgage servicing rights, net of valuation adjustments
    
    
    1,019,766
    
    
    
    1,061,407
    
    
    
    1,982,337Capitalized mortgage servicing rights
    
    
    (442,159
    )
    
    
    (844,806
    )
    
    
    (2,522,231
    )Deferred income tax benefit
    
    
    (1,259,100
    )
    
    
    (737,200
    )
    
    
    (540,900
    )Securities losses (gains), net
    
    
    21,000
    
    
    
    535,188
    
    
    
    (1,274,537
    )Loss (gain) on sale of premises
    
    
    0
    
    
    
    43,440
    
    
    
    (185,630
    )Loss on sales of real estate
    
    
    17,575
    
    
    
    21,775
    
    
    
    115,710Proceeds from sales of real estate
    
    
    605,072
    
    
    
    825,461
    
    
    
    740,194Gain on sales of loans
    
    
    (1,852,940
    )
    
    
    (1,702,979
    )
    
    
    (5,240,442
    )Proceeds from sales of loans held for sale
    
    
    97,015,434
    
    
    
    90,118,839
    
    
    
    297,862,680Disbursements on loans held for sale
    
    
    (85,200,488
    )
    
    
    (84,592,187
    )
    
    
    (280,633,930
    )Principal collected on loans held for sale
    
    
    0
    
    
    
    0
    
    
    
    11,521Amortization of restricted stock awards
    
    
    97,922
    
    
    
    0
    
    
    
    0Amortization of unearned ESOP Shares
    
    
    193,301
    
    
    
    193,784
    
    
    
    193,301Earned employee stock ownership shares priced above original cost
    
    
    339,798
    
    
    
    308,165
    
    
    
    180,457Increase in accrued interest receivable
    
    
    (765,881
    )
    
    
    (231,912
    )
    
    
    (411,585
    )Increase (decrease) in accrued interest payable
    
    
    771,217
    
    
    
    547,519
    
    
    
    (82,590
    )Equity losses of limited partnerships
    
    
    27,210
    
    
    
    26,118
    
    
    
    243,305Equity losses of minority interest
    
    
    0
    
    
    
    (3,109
    )
    
    
    (3,014
    )Decrease (increase) in other assets
    
    
    776,290
    
    
    
    (533,660
    )
    
    
    680,227(Decrease) increase in other liabilities
    
    
    (60,973
    )
    
    
    (1,820,633
    )
    
    
    663,785Other, net
    
    
    82,596
    
    
    
    (62,873
    )
    
    
    178,627Net cash provided by operating activities
    
    
    25,071,722
    
    
    
    15,386,790
    
    
    
    24,798,554Cash flows from investing activities:Proceeds from sales of securities available for sale
    
    
    0
    
    
    
    15,129,325
    
    
    
    50,372,919Principal collected on securities available for sale
    
    
    2,138,735
    
    
    
    4,354,497
    
    
    
    30,938,152Proceeds collected on maturity of securities available for sale
    
    
    21,000,000
    
    
    
    15,000,000
    
    
    
    10,000,000Purchases of securities available for sale
    
    
    (39,463,634
    )
    
    
    (34,877,137
    )
    
    
    (76,410,791
    )Redemption of interest in limited partnership
    
    
    0
    
    
    
    422,474
    
    
    
    0Purchase of Federal Home Loan Bank stock
    
    
    (2,427,300
    )
    
    
    (1,793,200
    )
    
    
    (768,900
    )Redemption of Federal Home Loan Bank stock
    
    
    3,355,500
    
    
    
    2,504,800
    
    
    
    2,645,000Net increase in loans receivable
    
    
    (14,532,425
    )
    
    
    (96,761,454
    )
    
    
    (161,455,973
    )Proceeds from sale of premises
    
    
    0
    
    
    
    266,972
    
    
    
    416,354Purchases of premises and equipment
    
    
    (1,208,518
    )
    
    
    (2,220,610
    )
    
    
    (1,046,235
    )Net cash used by investing activities
    
    
    (31,137,642
    )
    
    
    (97,974,333
    )
    
    
    (145,309,474
    )Cash flows from financing activities:Increase in deposits
    
    
    33,218,736
    
    
    
    147,580,390
    
    
    
    118,784,449Purchase of treasury stock
    
    
    (972,000
    )
    
    
    (3,316,550
    )
    
    
    (1,384,560
    )Stock options exercised
    
    
    37,887
    
    
    
    66,634
    
    
    
    1,422,460Dividends to stockholders
    
    
    (3,524,140
    )
    
    
    (3,246,426
    )
    
    
    (2,901,071
    )Proceeds from Federal Home Loan Bank advances
    
    
    78,000,000
    
    
    
    54,900,000
    
    
    
    161,000,000Repayment of Federal Home Loan Bank advances
    
    
    (88,000,000
    )
    
    
    (87,900,000
    )
    
    
    (175,400,000
    )Minority interest in limited partnership
    
    
    0
    
    
    
    0
    
    
    
    7,000Increase (decrease) in customer escrows
    
    
    275,838
    
    
    
    (21,694,934
    )
    
    
    21,750,458Net cash provided by financing activities
    
    
    19,036,321
    
    
    
    86,389,114
    
    
    
    123,278,736Increase in cash and cash equivalents
    
    
    12,970,401
    
    
    
    3,801,571
    
    
    
    2,767,816Cash and cash equivalents, beginning of year
    
    
    34,298,394
    
    
    
    30,496,823
    
    
    
    27,729,007Cash and cash equivalents, end of year
    
    $
    47,268,795
    
    
    
    34,298,394
    
    
    
    30,496,823Supplemental cash flow disclosures:Cash paid for interest
    
    $
    23,740,233
    
    
    
    20,445,776
    
    
    
    20,371,643Cash paid for income taxes
    
    
    6,601,281
    
    
    
    6,548,500
    
    
    
    2,141,000Supplemental noncash flow disclosures:Loans transferred to loans held for sale
    
    
    8,662,175
    
    
    
    0
    
    
    
    3,741,477Transfer of loans to real estate
    
    
    15,994,671
    
    
    
    892,802
    
    
    
    769,584Transfer of real estate to loans
    
    
    14,195,361
    
    
    
    0
    
    
    
    47,802
 See accompanying notes to consolidated financial statements.
 25




---



##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 December 31, 2005, 2004 and 2003
 NOTE 1 Description of the Business and Summary
of Significant Accounting Policies
   Use of Estimates
    Cash and Cash Equivalents
 Securities
 Trading
Securities
 Securities Held to Maturity
 Securities Available for Sale
 Loans Held for Sale
 Loans Receivable, Net
   26




---



##### 



Mortgage Servicing Rights
 Real Estate, Net
 Premises and Equipment
  Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of
 Investment in Limited Partnerships
 Intangible Assets Goodwill and Other Intangible Assets.
 Stock-Based Compensation
 Year ended December 31,2005
    
    
    2004
    
    
    2003Net income:As reported
    
    $
    11,067,889
    
    
    
    9,289,797
    
    
    
    8,605,247Deduct: Total stock-based
employee compensation
expense determined under
fair value based method
for all awards, net of
related tax effects
    
    
    54,619
    
    
    
    37,822
    
    
    
    44,935Pro forma
    
    $
    11,013,270
    
    
    
    9,251,975
    
    
    
    8,560,312Earnings per common share:As reported:Basic
    
    $
    2.89
    
    
    
    2.40
    
    
    
    2.26Diluted
    
    
    2.77
    
    
    
    2.31
    
    
    
    2.16Pro forma:Basic
    
    
    2.88
    
    
    
    2.39
    
    
    
    2.25Diluted
    
    
    2.77
    
    
    
    2.30
    
    
    
    2.15
 Income Taxes
 Earnings per Share
 27




---



##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  Comprehensive Income
 Segment Information
 New Accounting Pronouncement Share-Based Payment Accounting for Stock-Based
Compensation Accounting for Stock Issued to
Employees
 Derivative Financial Instruments
 Reclassifications
 NOTE 2 Other Comprehensive Income
  For the twelve months ended December 31,(Dollars in thousands)
    
    2005
    
    
    2004Securities available for sale:
    
    Before tax
    
    
    Tax effect
    
    
    Net of tax
    
    
    Before tax
    
    
    Tax effect
    
    
    Net of taxGross unrealized losses
arising during the period
    
    $
    (607
    )
    
    
    (279
    )
    
    
    (328
    )
    
    
    (1,391
    )
    
    
    (491
    )
    
    
    (900
    )Less reclassification of net gains included in net
income
    
    
    (21
    )
    
    
    (6
    )
    
    
    (15
    )
    
    
    (535
    )
    
    
    (189
    )
    
    
    (346
    )Net unrealized losses arising during the period
    
    
    (586
    )
    
    
    (273
    )
    
    
    (313
    )
    
    
    (856
    )
    
    
    (302
    )
    
    
    (554
    )Other comprehensive loss
    
    $
    (586
    )
    
    
    (273
    )
    
    
    (313
    )
    
    
    (856
    )
    
    
    (302
    )
    
    
    (554
    )
 28




---



##### 



NOTE 3 Securities Available for Sale
  Gross
    
    
    GrossAmortized
    
    
    unrealized
    
    
    unrealized
    
    
    Faircost
    
    
    gains
    
    
    losses
    
    
    valueDecember 31, 2005:Mortgage-backed securities:FHLMC
    
    $
    196,085
    
    
    
    5,590
    
    
    
    0
    
    
    
    201,675GNMA
    
    
    14,229
    
    
    
    276
    
    
    
    0
    
    
    
    14,505Collateralized mortgage obligations:FHLMC
    
    
    3,117,121
    
    
    
    0
    
    
    
    302,494
    
    
    
    2,814,627FNMA
    
    
    4,101,069
    
    
    
    2,027
    
    
    
    254,147
    
    
    
    3,848,9497,428,504
    
    
    
    7,893
    
    
    
    556,641
    
    
    
    6,879,756Other marketable securities:U.S. Government and agency obligations
    
    
    110,109,841
    
    
    
    0
    
    
    
    971,028
    
    
    
    109,138,813Corporate and agency preferred stock
    
    
    3,640,000
    
    
    
    0
    
    
    
    0
    
    
    
    3,640,000113,749,841
    
    
    
    0
    
    
    
    971,028
    
    
    
    112,778,813$
    121,178,345
    
    
    
    7,893
    
    
    
    1,527,669
    
    
    
    119,658,569December 31, 2004:Mortgage-backed securities:FHLMC
    
    $
    242,841
    
    
    
    12,798
    
    
    
    0
    
    
    
    255,639GNMA
    
    
    21,644
    
    
    
    1,157
    
    
    
    0
    
    
    
    22,801Collateralized mortgage obligations:FHLMC
    
    
    3,661,962
    
    
    
    0
    
    
    
    219,947
    
    
    
    3,442,015FNMA
    
    
    5,582,930
    
    
    
    18,589
    
    
    
    171,103
    
    
    
    5,430,4169,509,377
    
    
    
    32,544
    
    
    
    391,050
    
    
    
    9,150,871Other marketable securities:U.S. Government and agency obligations
    
    
    91,371,119
    
    
    
    7,500
    
    
    
    583,335
    
    
    
    90,795,284Corporate debt
    
    
    64,932
    
    
    
    296
    
    
    
    0
    
    
    
    65,228Corporate and agency preferred stock
    
    
    3,661,000
    
    
    
    0
    
    
    
    0
    
    
    
    3,661,00095,097,051
    
    
    
    7,796
    
    
    
    583,335
    
    
    
    94,521,512$
    104,606,428
    
    
    
    40,340
    
    
    
    974,385
    
    
    
    103,672,383
   Amortized
    
    
    Faircost
    
    
    valueDue less than one year
    
    $
    100,909,065
    
    
    
    100,061,503Due after one year through five years
    
    
    12,510,957
    
    
    
    12,164,063Due after five years through ten years
    
    
    1,592,052
    
    
    
    1,475,007Due after ten years
    
    
    2,526,271
    
    
    
    2,317,996No stated maturity
    
    
    3,640,000
    
    
    
    3,640,000Total
    
    $
    121,178,345
    
    
    
    119,658,569
   29




---



##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Less than twelve months
    
    
    Twelve months or more
    
    
    Total# of
    
    
    Fair
    
    
    Unrealized
    
    
    # of
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized(Dollars in thousands)
    
    Investments
    
    
    Value
    
    
    Losses
    
    
    Investments
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesMortgage backed securities:FHLMC
    
    
    
    
    
    $
    0
    
    
    
    0
    
    
    
    2
    
    
    $
    2,814
    
    
    
    (303
    )
    
    $
    2,814
    
    
    
    (303
    )FNMA
    
    
    1
    
    
    
    384
    
    
    
    (11
    )
    
    
    2
    
    
    
    3,304
    
    
    
    (243
    )
    
    
    3,688
    
    
    
    (254
    )Other marketable debt securities:FNMA
    
    
    1
    
    
    
    4,958
    
    
    
    (6
    )
    
    
    3
    
    
    
    14,836
    
    
    
    (147
    )
    
    
    19,794
    
    
    
    (153
    )FHLMC
    
    
    5
    
    
    
    24,700
    
    
    
    (13
    )
    
    
    4
    
    
    
    19,725
    
    
    
    (257
    )
    
    
    44,425
    
    
    
    (270
    )FHLB
    
    
    2
    
    
    
    9,906
    
    
    
    (62
    )
    
    
    7
    
    
    
    35,014
    
    
    
    (486
    )
    
    
    44,920
    
    
    
    (548
    )Total temporarily impaired securities
    
    
    9
    
    
    $
    39,948
    
    
    
    (92
    )
    
    
    18
    
    
    $
    75,693
    
    
    
    (1,436
    )
    
    $
    115,641
    
    
    
    (1,528
    )
  NOTE 4 Loans Receivable, Net
  2005
    
    
    2004Residential real estate loans:1-4 family conventional
    
    $
    126,397,513
    
    
    
    137,953,3401-4 family conventional  construction
    
    
    38,558,199
    
    
    
    37,841,3551-4 family FHA
    
    
    450,087
    
    
    
    647,0061-4 family VA
    
    
    227,055
    
    
    
    408,074165,632,854
    
    
    
    176,849,7755 or more family
    
    
    40,752,809
    
    
    
    41,921,6015 or more family  construction
    
    
    11,210,771
    
    
    
    19,153,847217,596,434
    
    
    
    237,925,223Commercial real estate:Lodging
    
    
    47,247,644
    
    
    
    49,799,669Retail/office
    
    
    51,062,980
    
    
    
    56,183,453Nursing home/health care
    
    
    6,868,065
    
    
    
    7,719,285Land developments
    
    
    101,069,732
    
    
    
    67,506,276Golf courses
    
    
    26,905,139
    
    
    
    29,363,624Restaurant/bar/café
    
    
    4,402,806
    
    
    
    4,013,659Ethanol plants
    
    
    8,898,424
    
    
    
    9,431,878Warehouse
    
    
    8,092,314
    
    
    
    8,793,067Manufacturing
    
    
    2,998,990
    
    
    
    5,698,911Churches/Community service
    
    
    3,364,752
    
    
    
    4,243,784Other
    
    
    29,930,294
    
    
    
    23,593,335290,841,140
    
    
    
    266,346,941Other loans:Autos
    
    
    5,461,586
    
    
    
    9,496,044Home equity line
    
    
    61,011,142
    
    
    
    67,140,395Home equity
    
    
    19,075,822
    
    
    
    20,032,508Consumer  secured
    
    
    979,349
    
    
    
    1,522,682Commercial business
    
    
    193,962,012
    
    
    
    182,368,675Land/lot loans
    
    
    9,486,634
    
    
    
    11,572,361Savings
    
    
    605,383
    
    
    
    453,522Mobile home
    
    
    2,298,816
    
    
    
    2,896,209Consumer  unsecured
    
    
    1,979,533
    
    
    
    1,859,611294,860,277
    
    
    
    297,342,007Total loans
    
    
    803,297,851
    
    
    
    801,614,171Less:Unamortized discounts
    
    
    190,388
    
    
    
    63,377Net deferred loan fees
    
    
    1,643,629
    
    
    
    1,781,018Allowance for losses
    
    
    8,777,655
    
    
    
    8,995,892Loans in process
    
    
    7,007,718
    
    
    
    7,560,622$
    785,678,461
    
    
    
    783,213,262Commitments to originate or
purchase loans
    
    $
    44,927,627
    
    
    
    68,751,130Commitments to deliver loans to
secondary market
    
    $
    4,690,823
    
    
    
    6,433,115Weighted average contractual loan rate
    
    
    6.32
    %
    
    
    6.26
    %Loans serviced for others
    
    $
    541,597,254
    
    
    
    523,635,219
      30




---



##### 



2005
    2004Percent
    
    
    
    
    
    
    PercentAmount
    
    
    of Total
    
    
    Amount
    
    
    of TotalAlabama
    
    $
    1,114,760
    
    
    
    0.5
    %
    
    $
    1,544,742
    
    
    
    0.6
    %Arizona
    
    
    2,497,464
    
    
    
    1.1
    
    
    
    2,031,585
    
    
    
    0.9Florida
    
    
    976,079
    
    
    
    0.4
    
    
    
    2,204,299
    
    
    
    0.9Georgia
    
    
    3,071,349
    
    
    
    1.4
    
    
    
    5,236,234
    
    
    
    2.2Illinois
    
    
    609,561
    
    
    
    0.3
    
    
    
    1,683,487
    
    
    
    0.7Iowa
    
    
    13,059,087
    
    
    
    6.0
    
    
    
    16,944,040
    
    
    
    7.1Massachusetts
    
    
    783,492
    
    
    
    0.4
    
    
    
    1,252,635
    
    
    
    0.5Minnesota
    
    
    187,307,513
    
    
    
    86.1
    
    
    
    189,770,503
    
    
    
    79.8North Carolina
    
    
    1,316,680
    
    
    
    0.6
    
    
    
    2,450,469
    
    
    
    1.0Texas
    
    
    0
    
    
    
    0.0
    
    
    
    6,612,676
    
    
    
    2.8Wisconsin
    
    
    4,567,778
    
    
    
    2.1
    
    
    
    4,548,029
    
    
    
    1.9Other states
    
    
    2,292,671
    
    
    
    1.1
    
    
    
    3,646,524
    
    
    
    1.6Total
    
    $
    217,596,434
    
    
    
    100.0
    %
    
    $
    237,925,223
    
    
    
    100.0
    %
   2005
    2004Percent
    
    
    
    
    
    
    PercentAmount
    
    
    of Total
    
    
    Amount
    
    
    of TotalArizona
    
    $
    3,159,523
    
    
    
    1.1
    %
    
    $
    3,346,259
    
    
    
    1.3
    %California
    
    
    1,000,000
    
    
    
    0.3
    
    
    
    1,000,000
    
    
    
    0.3Colorado
    
    
    0
    
    
    
    0.0
    
    
    
    1,674,433
    
    
    
    0.6Illinois
    
    
    658,800
    
    
    
    0.2
    
    
    
    658,800
    
    
    
    0.3Indiana
    
    
    650,649
    
    
    
    0.3
    
    
    
    660,435
    
    
    
    0.3Iowa
    
    
    15,757,914
    
    
    
    5.4
    
    
    
    25,144,085
    
    
    
    9.4Kansas
    
    
    8,303,539
    
    
    
    2.9
    
    
    
    0
    
    
    
    0.0Minnesota
    
    
    251,087,445
    
    
    
    86.3
    
    
    
    219,937,723
    
    
    
    82.6Missouri
    
    
    4,298,961
    
    
    
    1.5
    
    
    
    4,376,886
    
    
    
    1.6Montana
    
    
    2,026,126
    
    
    
    0.7
    
    
    
    2,114,048
    
    
    
    0.8Nebraska
    
    
    947,905
    
    
    
    0.3
    
    
    
    947,905
    
    
    
    0.4South Dakota
    
    
    944,281
    
    
    
    0.3
    
    
    
    1,603,132
    
    
    
    0.6Utah
    
    
    1,840,143
    
    
    
    0.6
    
    
    
    1,892,340
    
    
    
    0.7Wisconsin
    
    
    165,854
    
    
    
    0.1
    
    
    
    2,990,895
    
    
    
    1.1Total
    
    $
    290,841,140
    
    
    
    100.0
    %
    
    $
    266,346,941
    
    
    
    100.0
    %
 NOTE 5 Allowance for Loan Losses
  Balance, December 31, 2002
    
    $
    4,824,217Provision for losses
    
    
    2,610,000Charge-offs
    
    
    (550,580
    )Recoveries
    
    
    55,965Balance, December 31, 2003
    
    
    6,939,602Provision for losses
    
    
    2,755,000Charge-offs
    
    
    (737,917
    )Recoveries
    
    
    39,207Balance, December 31, 2004
    
    
    8,995,892Provision for losses
    
    
    2,674,000Charge-offs
    
    
    (3,076,815
    )Recoveries
    
    
    184,578Balance, December 31, 2005
    
    $
    8,777,655
 NOTE 6 Accrued Interest Receivable
  2005
    
    
    2004Securities available for sale
    
    $
    578,068
    
    
    
    626,367Loans receivable
    
    
    3,881,946
    
    
    
    3,067,766$
    4,460,014
    
    
    
    3,694,133
 NOTE 7 Investment in Mortgage Servicing Rights
  2005
    
    
    2004Mortgage servicing rightsBalance, beginning of year
    
    $
    3,231,242
    
    
    
    3,447,843Originations
    
    
    442,159
    
    
    
    844,806Amortization
    
    
    (1,019,766
    )
    
    
    (1,061,407
    )Balance, end of year
    
    
    2,653,635
    
    
    
    3,231,242Valuation reserve
    
    
    0
    
    
    
    0Mortgage servicing rights, net
    
    $
    2,653,635
    
    
    
    3,231,242
  WeightedWeighted
    
    AverageLoan
    
    Average
    
    Remaining
    
    NumberPrincipal
    
    Interest
    
    Term
    
    ofBalance
    
    Rate
    
    (months)
    
    LoansOriginal
term 30 year fixed rate
    
    $
    213,098,614
    
    
    
    5.90
    %
    
    
    334
    
    
    
    1,869Original term 15 year
fixed rate
    
    
    205,868,685
    
    
    
    5.27
    
    
    
    150
    
    
    
    2,618Adjustable rate
    
    
    6,118,532
    
    
    
    5.29
    
    
    
    324
    
    
    
    57
 31




---



##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 8 Real Estate
  2005
    
    
    2004Real estate in judgment
subject to redemption
    
    $
    43,052
    
    
    
    116,000Real estate acquired through foreclosure
    
    
    521,569
    
    
    
    24,608Real estate acquired through deed
in lieu of foreclosure
    
    
    750,000
    
    
    
    01,314,621
    
    
    
    140,608Allowance for losses
    
    
    (100,000
    )
    
    
    0$
    1,214,621
    
    
    
    140,608
 NOTE 9 Investment in Limited Partnerships
  NOTE 10 Intangible Assets
  Gross
    
    
    
    
    
    
    UnamortizedCarrying
    
    
    Accumulated
    
    
    IntangibleAmount
    
    
    Amortization
    
    
    AssetsDecember 31, 2005Amortized intangible assets:Mortgage servicing rights
    
    $
    4,410,439
    
    
    
    (1,756,804
    )
    
    
    2,653,635Core deposit intangible
    
    
    1,567,000
    
    
    
    (1,347,240
    )
    
    
    219,760Total
    
    $
    5,977,439
    
    
    
    (3,104,044
    )
    
    
    2,873,395December 31, 2004Amortized intangible assets:Mortgage servicing rights
    
    $
    4,555,552
    
    
    
    (1,324,310
    )
    
    
    3,231,242Core deposit intangible
    
    
    1,567,000
    
    
    
    (1,233,383
    )
    
    
    333,617Total
    
    $
    6,122,552
    
    
    
    (2,557,693
    )
    
    
    3,564,859
  Mortgage
    
    CoreServicing
    
    DepositRights
    
    Intangible
    
    TotalYear ended December 31,2006
    
    $
    486,493
    
    
    
    113,857
    
    
    
    600,3502007
    
    
    405,806
    
    
    
    105,903
    
    
    
    511,7092008
    
    
    337,859
    
    
    
    0
    
    
    
    337,8592009
    
    
    280,694
    
    
    
    0
    
    
    
    280,6942010
    
    
    232,650
    
    
    
    0
    
    
    
    232,650
  32




---



##### 



NOTE 11 Premises and Equipment
  2005
    
    
    2004Land
    
    $
    1,309,519
    
    
    
    1,309,519Office buildings and improvements
    
    
    9,428,917
    
    
    
    9,309,207Furniture and equipment
    
    
    10,997,705
    
    
    
    9,904,47421,736,141
    
    
    
    20,523,200Less accumulated depreciation
    
    
    (9,794,278
    )
    
    
    (8,058,935
    )$
    11,941,863
    
    
    
    12,464,265
 NOTE 12 Deposits
  2005
    
    
    2004Weighted
    
    
    
    
    
    
    Percent of
    
    
    Weighted
    
    
    
    
    
    
    Percent ofaverage rate
    
    
    Amount
    
    
    total
    
    
    average rate
    
    
    Amount
    
    
    totalNoninterest checking
    
    
    0.00
    %
    
    $
    58,429,385
    
    
    
    8.0
    %
    
    
    0.00
    %
    
    $
    42,776,699
    
    
    
    6.1
    %NOW accounts
    
    
    2.08
    
    
    
    101,942,029
    
    
    
    13.9
    
    
    
    1.01
    
    
    
    95,294,144
    
    
    
    13.6Savings accounts
    
    
    2.04
    
    
    
    84,858,265
    
    
    
    11.6
    
    
    
    0.19
    
    
    
    47,415,778
    
    
    
    6.8Money market accounts
    
    
    2.59
    
    
    
    96,947,209
    
    
    
    13.3
    
    
    
    1.72
    
    
    
    129,098,425
    
    
    
    18.5342,176,888
    
    
    
    46.8
    
    
    
    
    
    
    
    314,585,046
    
    
    
    45.0Certificates:1-1.99%
    
    
    
    
    
    
    6,497,132
    
    
    
    0.9
    
    
    
    
    
    
    
    63,716,056
    
    
    
    9.12-2.99%
    
    
    
    
    
    
    118,722,782
    
    
    
    16.2
    
    
    
    
    
    
    
    160,829,030
    
    
    
    23.03-3.99%
    
    
    
    
    
    
    211,018,548
    
    
    
    28.8
    
    
    
    
    
    
    
    108,937,895
    
    
    
    15.64-4.99%
    
    
    
    
    
    
    52,319,449
    
    
    
    7.2
    
    
    
    
    
    
    
    49,449,374
    
    
    
    7.15-5.99%
    
    
    
    
    
    
    796,604
    
    
    
    0.1
    
    
    
    
    
    
    
    1,266,218
    
    
    
    0.26-6.99%
    
    
    
    
    
    
    5,157
    
    
    
    0.0
    
    
    
    
    
    
    
    4,818
    
    
    
    0.07-7.99%
    
    
    
    
    
    
    0
    
    
    
    0.0
    
    
    
    
    
    
    
    113,748
    
    
    
    0.0Total certificates
    
    
    3.39
    
    
    
    389,359,672
    
    
    
    53.2
    
    
    
    2.86
    
    
    
    384,317,139
    
    
    
    55.0Total deposits
    
    
    2.67
    
    
    $
    731,536,560
    
    
    
    100.0
    %
    
    
    2.01
    
    
    $
    698,902,185
    
    
    
    100.0
    %
   2005
    
    
    2004Weighted
    
    
    
    
    
    
    WeightedAmount
    
    
    average
    
    
    Amount
    
    
    averageRemaining term to maturity
    
    (in thousands)
    
    
    rate
    
    
    (in thousands)
    
    
    rate1-6 months
    
    $
    102,326
    
    
    
    3.06
    %
    
    $
    110,550
    
    
    
    2.54
    %7-12 months
    
    
    96,919
    
    
    
    3.25
    
    
    
    87,099
    
    
    
    2.6013-36 months
    
    
    172,362
    
    
    
    3.65
    
    
    
    150,222
    
    
    
    3.10Over 36 months
    
    
    17,753
    
    
    
    3.59
    
    
    
    36,446
    
    
    
    3.51$
    389,360
    
    
    
    3.39
    
    
    $
    384,317
    
    
    
    2.86
   2005
    
    
    2004
    
    
    2003NOW
    
    $
    1,770,001
    
    
    
    702,102
    
    
    
    211,736Savings Accounts
    
    
    435,164
    
    
    
    77,293
    
    
    
    90,421Money Market
    
    
    1,328,344
    
    
    
    645,153
    
    
    
    437,645Certificates
    
    
    13,699,891
    
    
    
    10,973,957
    
    
    
    9,534,386$
    17,233,400
    
    
    
    12,398,505
    
    
    
    10,274,188
 33




---



##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 13 Federal Home Loan Bank Advances
  2005
    
    
    2004Year of Maturity
    
    Amount
    
    
    Rate
    
    
    Amount
    
    
    Rate2005
    
    
    
    
    
    
    
    
    
    $
    10,000,000
    
    
    
    2.69
    %2007
    
    $
    40,000,000
    
    
    
    2.91
    %
    
    
    40,000,000
    
    
    
    2.912008
    
    
    20,000,000
    
    
    
    3.83
    
    
    
    20,000,000
    
    
    
    3.832010
    
    
    10,000,000
    
    
    
    6.48
    
    
    
    10,000,000
    
    
    
    6.482011
    
    
    10,900,000
    
    
    
    4.81
    
    
    
    10,900,000
    
    
    
    4.812013
    
    
    80,000,000
    
    
    
    4.75
    
    
    
    80,000,000
    
    
    
    4.75160,900,000
    
    
    
    4.29
    
    
    
    170,900,000
    
    
    
    4.20Lines of Credit
    
    
    0
    
    
    
    
    
    
    
    0$
    160,900,000
    
    
    
    4.29
    
    
    $
    170,900,000
    
    
    
    4.20
  Callable QuarterlyYear of Maturity
    
    in 20062008
    
    $
    10,000,0002010
    
    
    10,000,0002011
    
    
    10,900,0002013
    
    
    80,000,000$
    110,900,000
  NOTE 14 Other Borrowed Money
  NOTE 15 Income Taxes
  2005
    
    
    2004
    
    
    2003Current:Federal
    
    $
    6,251,100
    
    
    
    4,688,700
    
    
    
    4,080,500State
    
    
    1,744,100
    
    
    
    435,600
    
    
    
    498,200Total current
    
    
    7,995,200
    
    
    
    5,124,300
    
    
    
    4,578,700Deferred:Federal
    
    
    (843,400
    )
    
    
    (683,200
    )
    
    
    (506,200
    )State
    
    
    (415,700
    )
    
    
    (54,000
    )
    
    
    (34,700
    )Total deferred
    
    
    (1,259,100
    )
    
    
    (737,200
    )
    
    
    (540,900
    )$
    6,736,100
    
    
    
    4,387,100
    
    
    
    4,037,800
 34




---



##### 



2005
    
    
    2004
    
    
    2003Federal expected income tax expense
    
    $
    6,053,400
    
    
    
    4,651,300
    
    
    
    4,297,600Items affecting federal income tax:Dividend received deduction
    
    
    (25,700
    )
    
    
    (16,200
    )
    
    
    (26,100
    )State income taxes, net of federal income tax benefit
    
    
    974,900
    
    
    
    247,900
    
    
    
    249,700Reduction of tax rate due to employee stock ownership plan dividends
    
    
    0
    
    
    
    (170,200
    )
    
    
    (160,500
    )Low income housing credits
    
    
    (42,000
    )
    
    
    (84,000
    )
    
    
    (84,000
    )Tax exempt interest
    
    
    (378,000
    )
    
    
    (340,300
    )
    
    
    (284,600
    )Other, net
    
    
    153,500
    
    
    
    98,600
    
    
    
    45,700$
    6,736,100
    
    
    
    4,387,100
    
    
    
    4,037,800
  2005
    
    
    2004Deferred tax assets:Allowances for loan and real estate losses
    
    $
    3,560,900
    
    
    
    3,144,400Discounts on assets and liabilities acquired from Marshalltown Financial Corporation
    
    
    100
    
    
    
    200Deferred compensation costs
    
    
    195,800
    
    
    
    162,400Impairment losses on securities available for sale
    
    
    221,900
    
    
    
    188,400Net unrealized loss on market value adjustments to securities available for sale
    
    
    602,200
    
    
    
    329,600Deferred ESOP loan asset
    
    
    506,900
    
    
    
    0Total gross deferred tax assets
    
    
    5,087,800
    
    
    
    3,825,000Valuation allowance
    
    
    0
    
    
    
    0Net deferred tax assets
    
    
    5,087,800
    
    
    
    3,825,000Deferred tax liabilities:Premium on assets acquired from Marshalltown Financial Corporation
    
    
    87,300
    
    
    
    117,000Deferred loan fees and costs
    
    
    475,200
    
    
    
    452,600Premises and equipment basis difference
    
    
    835,500
    
    
    
    1,078,100Originated mortgage servicing rights
    
    
    1,051,400
    
    
    
    1,161,100Other
    
    
    94,000
    
    
    
    3,500Total gross deferred tax liabilities
    
    
    2,543,400
    
    
    
    2,812,300Net deferred tax assets
    
    $
    2,544,400
    
    
    
    1,012,700
  35




---



##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 16 Employee Benefits
    Accounting for Employee Stock Ownership Plans
  2005
    
    
    2004
    
    
    2003Shares allocated to participants
beginning of the year
    
    
    270,884
    
    
    
    275,588
    
    
    
    245,031Shares allocated to participants
    
    
    24,317
    
    
    
    24,380
    
    
    
    24,317Shares purchased with dividends
from allocated shares
    
    
    8,311
    
    
    
    7,368
    
    
    
    10,638Shares distributed to participants
    
    
    (17,494
    )
    
    
    (36,452
    )
    
    
    (4,398
    )Shares allocated to participants
end of year
    
    
    286,018
    
    
    
    270,884
    
    
    
    275,588Unreleased shares beginning
of the year
    
    
    571,733
    
    
    
    596,113
    
    
    
    620,430Shares released during year
    
    
    (24,317
    )
    
    
    (24,380
    )
    
    
    (24,317
    )Unreleased shares end of year
    
    
    547,416
    
    
    
    571,733
    
    
    
    596,113Total ESOP shares end of year
    
    
    833,434
    
    
    
    842,617
    
    
    
    871,701Fair value of unreleased
shares at December 31
    
    $
    16,148,772
    
    
    
    18,861,472
    
    
    
    14,479,585
    36




---



##### 



Shares
    
    
    
    
    
    
    
    
    
    Awardavailable for
    
    Restricted
    
    Options
    
    value/
    
    Vestinggrant
    
    shares
    
    outstanding
    
    exercise price
    
    period1995 Stock Option and Incentive PlanDecember 31, 2002
    
    
    9,397
    
    
    
    
    
    
    
    407,248
    
    
    $
    10.15Exercised
    
    
    0
    
    
    
    
    
    
    
    (228,493
    )
    
    
    9.21December 31, 2003
    
    
    9,397
    
    
    
    
    
    
    
    178,755
    
    
    
    11.36Exercised
    
    
    0
    
    
    
    
    
    
    
    (43,814
    )
    
    
    9.47December 31, 2004
    
    
    9,397
    
    
    
    
    
    
    
    134,941
    
    
    
    11.97Exercised
    
    
    0
    
    
    
    
    
    
    
    (10,941
    )
    
    
    9.56Expired
    
    
    (9,397
    )
    
    
    
    
    
    
    
    
    
    
    N/ADecember 31, 2005
    
    
    0
    
    
    
    
    
    
    
    124,000
    
    
    
    12.182001 Omnibus Stock PlanDecember 31, 2002
    
    
    187,590
    
    
    
    
    
    
    
    212,410
    
    
    
    16.13Forfeited
    
    
    16,447
    
    
    
    
    
    
    
    (16,447
    )
    
    
    16.13December 31, 2003
    
    
    204,037
    
    
    
    
    
    
    
    195,963
    
    
    
    16.13Granted February 13, 2004
    
    
    (5,000
    )
    
    
    
    
    
    
    5,000
    
    
    
    27.64
    
    
    4 yearsGranted March 3, 2004
    
    
    (20,000
    )
    
    
    
    
    
    
    20,000
    
    
    
    27.66
    
    
    3 yearsGranted July 27, 2004
    
    
    (15,000
    )
    
    
    
    
    
    
    15,000
    
    
    
    26.98
    
    
    5 yearsForfeited
    
    
    17,618
    
    
    
    
    
    
    
    (17,618
    )
    
    
    19.05December 31, 2004
    
    
    181,655
    
    
    
    
    
    
    
    218,345
    
    
    
    17.96Granted January 25, 2005
    
    
    (10,047
    )
    
    
    10,047
    
    
    
    
    
    
    
    32.50
    
    
    3 yearsGranted May 24, 2005
    
    
    (15,000
    )
    
    
    
    
    
    
    15,000
    
    
    
    30.00
    
    
    5 yearsForfeited
    
    
    7,997
    
    
    
    (1,418
    )
    
    
    (6,579
    )
    
    
    16.13December 31, 2005
    
    
    164,605
    
    
    
    8,629
    
    
    
    226,766
    
    
    
    18.81Total both plans
    
    
    164,605
    
    
    
    8,629
    
    
    
    350,766
    
    
    
    16.47
  Options OutstandingWeighted averageExercise
    
    Number
    
    remaining contractual
    
    Numberprice
    
    outstanding
    
    life in years
    
    exercisable$13.01
    
    
    14,000
    
    
    
    1.3
    
    
    
    14,00011.50
    
    
    65,000
    
    
    
    3.3
    
    
    
    65,00011.25
    
    
    30,000
    
    
    
    4.4
    
    
    
    30,00016.25
    
    
    15,000
    
    
    
    6.4
    
    
    
    9,00016.13
    
    
    176,226
    
    
    
    6.3
    
    
    
    6,46627.64
    
    
    5,000
    
    
    
    8.2
    
    
    
    1,25027.66
    
    
    15,540
    
    
    
    8.2
    
    
    
    5,17926.98
    
    
    15,000
    
    
    
    8.6
    
    
    
    3,00030.00
    
    
    15,000
    
    
    
    9.4
    
    
    
    0350,766
    
    
    
    
    
    
    
    133,895
   2005
    
    2004Risk-free interest rate
    
    
    4.03
    %
    
    
    4.13
    %Expected life
    
    9 years
    
    9 yearsExpected volatility
    
    
    8.75
    %
    
    
    10.63
    %Expected dividends
    
    
    2.9
    %
    
    
    3.9
    %
 37




---



##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 17 Earnings per Share
  Year ended December 31,2005
    
    
    2004
    
    
    2003Weighted average number of
common shares outstanding
used in basic earnings per
common share calculation
    
    
    3,824,555
    
    
    
    3,868,223
    
    
    
    3,812,213Net dilutive effect of:Options
    
    
    166,207
    
    
    
    159,442
    
    
    
    169,171Restricted stock awards
    
    
    7,683
    
    
    
    0
    
    
    
    0Weighted average number of
shares outstanding
adjusted for effect of
dilutive securities
    
    
    3,998,445
    
    
    
    4,027,665
    
    
    
    3,981,384Net income available to
common shareholders
    
    $
    11,067,889
    
    
    
    9,289,797
    
    
    
    8,605,247Basic earnings per
common share
    
    $
    2.89
    
    
    
    2.40
    
    
    
    2.26Diluted earnings per
common share
    
    $
    2.77
    
    
    
    2.31
    
    
    
    2.16
 NOTE 18 Stockholders Equity
   QuarterlyDividend
    
    DividendRecord date
    
    Payable date
    
    per share
    
    Payout RatioFebruary 21, 2003
    
    March 7, 2003
    
    $
    0.18
    
    
    
    64.29
    %May 22, 2003
    
    June 9, 2003
    
    $
    0.18
    
    
    
    50.00
    %August 28, 2003
    
    September 11, 2003
    
    $
    0.20
    
    
    
    38.46
    %November 28, 2003
    
    December 17, 2003
    
    $
    0.20
    
    
    
    26.32
    %February 20, 2004
    
    March 8, 2004
    
    $
    0.20
    
    
    
    37.74
    %May 21, 2004
    
    June 8, 2004
    
    $
    0.20
    
    
    
    38.46
    %August 27, 2004
    
    September 10, 2004
    
    $
    0.22
    
    
    
    35.48
    %November 26, 2004
    
    December 15, 2004
    
    $
    0.22
    
    
    
    34.38
    %February 18, 2005
    
    March 7, 2005
    
    $
    0.22
    
    
    
    41.51
    %May 20, 2005
    
    June 8, 2005
    
    $
    0.22
    
    
    
    31.43
    %August 26, 2005
    
    September 9, 2005
    
    $
    0.24
    
    
    
    38.71
    %November 25, 2005
    
    December 14, 2005
    
    $
    0.24
    
    
    
    42.11
    %
     NOTE 19 Federal Home Loan Bank Investment and
Regulatory Capital Requirements
     38




---



##### 



To Be Well CapitalizedRequired to
    
    
    
    
    
    
    
    
    
    Under Promptbe Adequately
    
    
    
    
    
    
    
    
    
    Corrective ActionsActual
    
    Capitalized
    
    Excess Capital
    
    ProvisionsPercent of
    
    
    
    
    
    Percent of
    
    
    
    
    
    Percent of
    
    
    
    
    
    Percent of(Dollars in thousands)
    
    Amount
    
    Assets (1)
    
    Amount
    
    Assets (1)
    
    Amount
    
    Assets (1)
    
    Amount
    
    Assets (1)December 31, 2005Tier I or core capital
    
    $
    80,401
    
    
    
    8.18
    %
    
    $
    39,330
    
    
    
    4.00
    %
    
    $
    41,071
    
    
    
    4.18
    %
    
    $
    49,163
    
    
    
    5.00
    %Tier I risk based capital
    
    $
    80,401
    
    
    
    10.02
    %
    
    $
    32,102
    
    
    
    4.00
    %
    
    $
    48,299
    
    
    
    6.02
    %
    
    $
    48,153
    
    
    
    6.00
    %Risk-based capital to
risk-weighted assets
    
    $
    89,007
    
    
    
    11.09
    %
    
    $
    64,204
    
    
    
    8.00
    %
    
    $
    24,803
    
    
    
    3.09
    %
    
    $
    80,254
    
    
    
    10.00
    %December 31, 2004Tier I or core capital
    
    $
    74,131
    
    
    
    7.77
    %
    
    $
    38,150
    
    
    
    4.00
    %
    
    $
    35,981
    
    
    
    3.77
    %
    
    $
    47,687
    
    
    
    5.00
    %Tier I risk based capital
    
    $
    74,131
    
    
    
    9.45
    %
    
    $
    31,373
    
    
    
    4.00
    %
    
    $
    42,758
    
    
    
    5.45
    %
    
    $
    47,059
    
    
    
    6.00
    %Risk-based capital to
risk-weighted assets
    
    $
    82,274
    
    
    
    10.49
    %
    
    $
    62,746
    
    
    
    8.00
    %
    
    $
    19,528
    
    
    
    2.49
    %
    
    $
    78,432
    
    
    
    10.00
    %
 
 (1)
    
    Based upon the Banks adjusted total assets for the purpose of the Tier I or
core capital ratios and risk-weighted assets for the purpose of the risk-based capital ratio. NOTE 20 Financial Instruments with Off-Balance Sheet Risk
   December 31,Contract amount(Dollars in thousands)
    
    2005
    
    
    2004Financial instruments whose contract amount
represents credit risk:Commitments to originate, fund or purchase loans:1-4 family mortgages
    
    $
    3,850
    
    
    
    3,723Multi-family mortgages
    
    
    0
    
    
    
    12,000Commercial real estate mortgages
    
    
    19,835
    
    
    
    26,593Non-mortgage loans
    
    
    21,243
    
    
    
    26,435Undisbursed balance of loans closed
    
    
    75,465
    
    
    
    100,772Unused lines of credit
    
    
    97,445
    
    
    
    78,930Letters of credit
    
    
    10,158
    
    
    
    7,025Total commitments to extend credit
    
    $
    227,996
    
    
    
    255,478Forward commitments
    
    $
    4,691
    
    
    
    6,433
    39




---



##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
   NOTE 21 Derivative Instruments and Hedging Activities
 Accounting for Derivative
Instruments and Hedging Activities.
   NOTE 22 Fair Value of Financial Instruments
 Disclosures about Fair Values of Financial
Instruments,
   December 31,2005
    
    
    
    
    
    
    
    
    

2004Carrying
    
    Estimated
    
    Contract
    
    Carrying
    
    Estimated
    
    Contract(Dollars in thousands)
    
    amount
    
    fair value
    
    amount
    
    amount
    
    fair value
    
    amountFinancial assets:Cash and cash equivalents
    
    $
    47,269
    
    
    
    47,269
    
    
    
    
    
    
    
    34,298
    
    
    
    34,298Securities available for sale
    
    
    119,659
    
    
    
    119,659
    
    
    
    
    
    
    
    103,672
    
    
    
    103,672Loans held for sale
    
    
    1,435
    
    
    
    1,435
    
    
    
    
    
    
    
    2,712
    
    
    
    2,712Loans receivable, net
    
    
    785,678
    
    
    
    785,189
    
    
    
    
    
    
    
    783,213
    
    
    
    785,533Federal Home Loan Bank stock
    
    
    8,365
    
    
    
    8,365
    
    
    
    
    
    
    
    9,293
    
    
    
    9,293Accrued interest receivable
    
    
    4,460
    
    
    
    4,460
    
    
    
    
    
    
    
    3,694
    
    
    
    3,694Financial liabilities:Deposits
    
    
    731,536
    
    
    
    684,586
    
    
    
    
    
    
    
    698,902
    
    
    
    672,757Federal Home Loan Bank advances
    
    
    160,900
    
    
    
    161,929
    
    
    
    
    
    
    
    170,900
    
    
    
    175,973Accrued interest payable
    
    
    2,086
    
    
    
    2,086
    
    
    
    
    
    
    
    1,314
    
    
    
    1,314Off-balance sheet financial instruments:Commitments to extend credit
    
    
    5
    
    
    
    5
    
    
    
    229,189
    
    
    
    13
    
    
    
    13
    
    
    
    213,846Commitments to sell loans
    
    
    (19
    )
    
    
    (19
    )
    
    
    4,691
    
    
    
    (3
    )
    
    
    (3
    )
    
    
    6,433
 40




---



##### 



Cash and Cash Equivalents
 Securities Available for Sale
 Loans Held for Sale
 Loans Receivable
 Federal Home Loan Bank Stock
 Accrued Interest Receivable
 Deposits
  Federal Home Loan Bank Advances
 Accrued Interest Payable
 Commitments to Extend Credit
 Commitments to Sell Loans
 41




---



##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 23 HMN Financial, Inc. Financial Information (Parent Company Only)
  2005
    
    
    2004
    
    
    2003Condensed Balance SheetsAssets:Cash and cash equivalents
    
    $
    4,885,596
    
    
    
    5,608,727Investment in subsidiaries
    
    
    85,298,915
    
    
    
    78,236,806Real estate, net
    
    
    750,000
    
    
    
    0Accrued interest receivable
    
    
    0
    
    
    
    8,462Prepaid expenses and other assets
    
    
    231,433
    
    
    
    320,787Deferred tax asset
    
    
    195,400
    
    
    
    162,000Total assets
    
    $
    91,361,344
    
    
    
    84,336,782Liabilities and Stockholders Equity:Accrued expenses and other liabilities
    
    $
    633,075
    
    
    
    565,946Total liabilities
    
    
    633,075
    
    
    
    565,946Common stock
    
    
    91,287
    
    
    
    91,287Additional paid-in capital
    
    
    58,011,099
    
    
    
    57,875,595Retained earnings
    
    
    98,951,777
    
    
    
    91,408,028Net unrealized loss on securities available for sale
    
    
    (917,577
    )
    
    
    (604,446
    )Unearned employee stock option plan shares
    
    
    (4,350,999
    )
    
    
    (4,544,300
    )Unearned compensation stock awards
    
    
    (182,521
    )
    
    
    0Treasury stock, at cost, 4,721,402 and 4,708,798 shares
    
    
    (60,874,797
    )
    
    
    (60,455,328
    )Total stockholders equity
    
    
    90,728,269
    
    
    
    83,770,836Total liabilities and stockholders equity
    
    $
    91,361,344
    
    
    
    84,336,782Condensed Statements of IncomeInterest income
    
    $
    107,574
    
    
    
    69,936
    
    
    
    193,334Securities gains, net
    
    
    0
    
    
    
    0
    
    
    
    301,006Equity earnings of subsidiaries
    
    
    11,375,240
    
    
    
    9,453,280
    
    
    
    8,361,418Equity earnings of limited partnerships
    
    
    0
    
    
    
    803
    
    
    
    132,273Compensation and benefits
    
    
    (247,300
    )
    
    
    (207,300
    )
    
    
    (42,100
    )Occupancy
    
    
    (20,400
    )
    
    
    (14,400
    )
    
    
    (6,005
    )Advertising
    
    
    0
    
    
    
    0
    
    
    
    (2,500
    )Data processing
    
    
    (3,600
    )
    
    
    (2,600
    )
    
    
    (1,200
    )Mortgage servicing
    
    
    0
    
    
    
    (145
    )
    
    
    (8,009
    )Other
    
    
    (375,525
    )
    
    
    (409,377
    )
    
    
    (481,770
    )Income before income tax expense
    
    
    10,835,989
    
    
    
    8,890,197
    
    
    
    8,446,447Income tax benefit
    
    
    (231,900
    )
    
    
    (399,600
    )
    
    
    (158,800
    )Net income
    
    $
    11,067,889
    
    
    
    9,289,797
    
    
    
    8,605,247
 42




---



##### 



2005
    
    
    2004
    
    
    2003Condensed Statements of Cash FlowsCash flows from operating activities:Net income
    
    $
    11,067,889
    
    
    
    9,289,797
    
    
    
    8,605,247Adjustments to reconcile net income to cash provided by operating activities:Equity earnings of subsidiaries
    
    
    (11,375,240
    )
    
    
    (9,453,280
    )
    
    
    (8,361,418
    )Equity earnings in limited partnership
    
    
    0
    
    
    
    (803
    )
    
    
    (132,273
    )Securities gains, net
    
    
    0
    
    
    
    0
    
    
    
    (301,006
    )Deferred income taxes
    
    
    (33,400
    )
    
    
    (128,400
    )
    
    
    (3,200
    )Earned employee stock ownership shares priced above original cost
    
    
    339,798
    
    
    
    308,165
    
    
    
    180,457Decrease in restricted stock awards
    
    
    97,922
    
    
    
    0
    
    
    
    0Decrease in unearned ESOP shares
    
    
    193,301
    
    
    
    193,784
    
    
    
    193,301Decrease (increase) in accrued interest receivable
    
    
    8,462
    
    
    
    (2,842
    )
    
    
    15,548Increase in accrued expenses and other liabilities
    
    
    67,129
    
    
    
    340,696
    
    
    
    26,526Decrease in other assets
    
    
    119,261
    
    
    
    1,095,622
    
    
    
    330,037Other, net
    
    
    0
    
    
    
    (2
    )
    
    
    0Net cash provided by operating activities
    
    
    485,122
    
    
    
    1,642,737
    
    
    
    553,219Cash flows from investing activities:Proceeds from sales of securities available for sale
    
    
    0
    
    
    
    0
    
    
    
    1,601,007Purchase of real estate owned from subsidiary
    
    
    (750,000
    )
    
    
    0
    
    
    
    0Decrease in loans receivable, net
    
    
    0
    
    
    
    110,000
    
    
    
    1,491,383Redemption of investment in limited partnership
    
    
    0
    
    
    
    422,474
    
    
    
    0Net decrease in loans receivable from subsidiaries
    
    
    0
    
    
    
    0
    
    
    
    4,700,000Net cash (used) provided by investing activities
    
    
    (750,000
    )
    
    
    532,474
    
    
    
    7,792,390Cash flows from financing activities:Purchase of treasury stock
    
    
    (972,000
    )
    
    
    (3,316,550
    )
    
    
    (1,384,560
    )Stock options exercised
    
    
    37,887
    
    
    
    66,634
    
    
    
    1,422,460Dividends to stockholders
    
    
    (3,524,140
    )
    
    
    (3,246,426
    )
    
    
    (2,901,071
    )Proceeds from dividends on Bank stock
    
    
    4,000,000
    
    
    
    4,000,000
    
    
    
    0Net cash used by financing activities
    
    
    (458,253
    )
    
    
    (2,496,342
    )
    
    
    (2,863,171
    )(Decrease) increase in cash and cash equivalents
    
    
    (723,131
    )
    
    
    (321,131
    )
    
    
    5,482,438Cash and cash equivalents, beginning of year
    
    
    5,608,727
    
    
    
    5,929,858
    
    
    
    447,420Cash and cash equivalents, end of year
    
    $
    4,885,596
    
    
    
    5,608,727
    
    
    
    5,929,858
 43




---



##### 



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 24 Business Segments
    Home Federal
    
    
    
    
    
    
    
    
    
    Consolidated(Dollars in thousands)
    
    Savings Bank
    
    Other
    
    Eliminations
    
    TotalAt or for the year ended December 31, 2005:Interest income  external customers
    
    $
    60,201
    
    
    
    80
    
    
    
    0
    
    
    
    60,281Non-interest income  external customers
    
    
    6,536
    
    
    
    0
    
    
    
    0
    
    
    
    6,536Losses in limited partnerships
    
    
    (27
    )
    
    
    0
    
    
    
    0
    
    
    
    (27
    )Intersegment interest income
    
    
    0
    
    
    
    28
    
    
    
    (28
    )
    
    
    0Intersegment non-interest income
    
    
    134
    
    
    
    11,375
    
    
    
    (11,509
    )
    
    
    0Interest expense
    
    
    24,539
    
    
    
    0
    
    
    
    (28
    )
    
    
    24,511Amortization of mortgage servicing rights, net
    
    
    1,020
    
    
    
    0
    
    
    
    0
    
    
    
    1,020Other non-interest expense
    
    
    20,260
    
    
    
    655
    
    
    
    (134
    )
    
    
    20,781Income tax expense (benefit)
    
    
    6,971
    
    
    
    (235
    )
    
    
    0
    
    
    
    6,736Net income
    
    
    11,380
    
    
    
    11,063
    
    
    
    (11,375
    )
    
    
    11,068Goodwill
    
    
    3,801
    
    
    
    0
    
    
    
    0
    
    
    
    3,801Total assets
    
    
    985,456
    
    
    
    91,410
    
    
    
    (85,629
    )
    
    
    991,237Net interest margin
    
    
    3.80
    %
    
    NM
    
    NM
    
    
    3.80
    %Return on average assets
    
    
    1.17
    
    
    NM
    
    NM
    
    
    1.12Return on average realized common equity
    
    
    13.93
    
    
    NM
    
    NM
    
    
    12.42At or for the year ended December 31, 2004:Interest income  external customers
    
    $
    51,568
    
    
    
    49
    
    
    
    0
    
    
    
    51,617Non-interest income  external customers
    
    
    5,993
    
    
    
    0
    
    
    
    0
    
    
    
    5,993Earnings (losses) on limited partnerships
    
    
    (27
    )
    
    
    1
    
    
    
    0
    
    
    
    (26
    )Intersegment interest income
    
    
    0
    
    
    
    21
    
    
    
    (21
    )
    
    
    0Intersegment non-interest income
    
    
    174
    
    
    
    9,453
    
    
    
    (9,627
    )
    
    
    0Interest expense
    
    
    21,014
    
    
    
    0
    
    
    
    (21
    )
    
    
    20,993Amortization of mortgage servicing rights, net
    
    
    1,061
    
    
    
    0
    
    
    
    0
    
    
    
    1,061Other non-interest expense
    
    
    18,633
    
    
    
    642
    
    
    
    (174
    )
    
    
    19,101Income tax expense (benefit)
    
    
    4,790
    
    
    
    (403
    )
    
    
    0
    
    
    
    4,387Minority interest
    
    
    (3
    )
    
    
    0
    
    
    
    0
    
    
    
    (3
    )Net income
    
    
    9,458
    
    
    
    9,285
    
    
    
    (9,453
    )
    
    
    9,290Goodwill
    
    
    3,801
    
    
    
    0
    
    
    
    0
    
    
    
    3,801Total assets
    
    
    954,779
    
    
    
    84,391
    
    
    
    (78,497
    )
    
    
    960,673Net interest margin
    
    
    3.51
    %
    
    NM
    
    NM
    
    
    3.50
    %Return on average assets
    
    
    1.04
    
    
    NM
    
    NM
    
    
    1.01Return on average realized common equity
    
    
    12.49
    
    
    NM
    
    NM
    
    
    11.03At or for the year ended December 31, 2003:Interest income  external customers
    
    $
    44,775
    
    
    
    162
    
    
    
    0
    
    
    
    44,937Non-interest income  external customers
    
    
    10,198
    
    
    
    301
    
    
    
    0
    
    
    
    10,499Earnings (losses) on limited partnerships
    
    
    (376
    )
    
    
    132
    
    
    
    0
    
    
    
    (244
    )Intersegment interest income
    
    
    28
    
    
    
    31
    
    
    
    (59
    )
    
    
    0Intersegment non-interest income
    
    
    868
    
    
    
    8,361
    
    
    
    (9,229
    )
    
    
    0Interest expense
    
    
    20,348
    
    
    
    0
    
    
    
    (59
    )
    
    
    20,289Amortization of mortgage servicing rights, net
    
    
    2,298
    
    
    
    8
    
    
    
    (324
    )
    
    
    1,982Other non-interest expense
    
    
    17,456
    
    
    
    542
    
    
    
    (327
    )
    
    
    17,671Income tax expense (benefit)
    
    
    4,200
    
    
    
    (162
    )
    
    
    0
    
    
    
    4,038Minority interest
    
    
    (3
    )
    
    
    0
    
    
    
    0
    
    
    
    (3
    )Net income
    
    
    8,584
    
    
    
    8,599
    
    
    
    (8,578
    )
    
    
    8,605Goodwill
    
    
    3,801
    
    
    
    0
    
    
    
    0
    
    
    
    3,801Total assets
    
    
    860,510
    
    
    
    81,182
    
    
    
    (74,966
    )
    
    
    866,726Net interest margin
    
    
    3.30
    %
    
    NM
    
    NM
    
    
    3.31
    %Return on average assets
    
    
    1.08
    
    
    NM
    
    NM
    
    
    1.10Return on average realized common equity
    
    
    11.88
    
    
    NM
    
    NM
    
    
    10.85
 
 NM  Not meaningful 44




---



##### 



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
 The Board of Directors
HMN Financial, Inc.:
     KPMG LLP
 Minneapolis, Minnesota
March 1, 2006
 45




---



##### 



SELECTED QUARTERLY FINANCIAL DATA
 December 31,
    
    
    September 30,
    
    
    June 30,(Dollars in thousands, except per
share data)
    
    2005
    
    
    2005
    
    
    2005Selected
Operations Data (3 months ended):Interest income
    
    $
    16,074
    
    
    
    15,238
    
    
    
    14,773Interest expense
    
    
    6,667
    
    
    
    6,292
    
    
    
    6,027Net interest income
    
    
    9,407
    
    
    
    8,946
    
    
    
    8,746Provision for loan losses
    
    
    179
    
    
    
    952
    
    
    
    907Net interest income after provision for loan losses
    
    
    9,228
    
    
    
    7,994
    
    
    
    7,839Noninterest income:Fees and service charges
    
    
    725
    
    
    
    706
    
    
    
    685Loan servicing fees
    
    
    308
    
    
    
    305
    
    
    
    304Securities gains (losses), net
    
    
    (21
    )
    
    
    0
    
    
    
    0Gain on sales of loans
    
    
    611
    
    
    
    625
    
    
    
    324Losses in limited partnerships
    
    
    (7
    )
    
    
    (6
    )
    
    
    (6
    )Other noninterest income
    
    
    171
    
    
    
    91
    
    
    
    268Total noninterest income
    
    
    1,787
    
    
    
    1,721
    
    
    
    1,575Noninterest expense:Compensation and benefits
    
    
    2,800
    
    
    
    2,781
    
    
    
    2,785Occupancy
    
    
    1,002
    
    
    
    1,042
    
    
    
    1,042Deposit insurance premiums
    
    
    33
    
    
    
    35
    
    
    
    34Advertising
    
    
    93
    
    
    
    102
    
    
    
    105Data processing
    
    
    270
    
    
    
    279
    
    
    
    245Amortization of mortgage servicing rights, net
    
    
    253
    
    
    
    257
    
    
    
    271Other noninterest expense
    
    
    989
    
    
    
    1,054
    
    
    
    1,039Total noninterest expense
    
    
    5,440
    
    
    
    5,550
    
    
    
    5,521Income before income tax expense
    
    
    5,575
    
    
    
    4,165
    
    
    
    3,893Income tax expense
    
    
    2,098
    
    
    
    1,889
    
    
    
    1,393Income before minority interest
    
    
    3,477
    
    
    
    2,276
    
    
    
    2,500Minority interest
    
    
    0
    
    
    
    0
    
    
    
    0Net income
    
    $
    3,477
    
    
    
    2,276
    
    
    
    2,500Basic earnings per share
    
    $
    0.91
    
    
    
    0.59
    
    
    
    0.65Diluted earnings per share
    
    $
    0.87
    
    
    
    0.57
    
    
    
    0.62Financial Ratios:Return on average assets(1)
    
    
    1.39
    %
    
    
    0.92
    
    
    
    1.01Return on average equity(1)
    
    
    15.03
    
    
    
    10.02
    
    
    
    11.41Average equity to average assets
    
    
    9.05
    
    
    
    8.99
    
    
    
    8.90Dividend payout ratio
    
    
    42.11
    
    
    
    38.71
    
    
    
    31.43Net interest margin(1)(2)
    
    
    3.94
    
    
    
    3.79
    
    
    
    3.70(Dollars in thousands)Selected Financial Condition Data:Total assets
    
    $
    991,237
    
    
    
    982,304
    
    
    
    985,662Securities available for sale:Mortgage-backed and related securities
    
    
    6,880
    
    
    
    7,481
    
    
    
    8,220Other marketable securities
    
    
    112,779
    
    
    
    91,031
    
    
    
    91,053Loans held for sale
    
    
    1,435
    
    
    
    4,058
    
    
    
    4,290Loans receivable, net
    
    
    785,678
    
    
    
    815,164
    
    
    
    819,940Deposits
    
    
    731,537
    
    
    
    714,711
    
    
    
    720,230Federal Home Loan Bank advances
    
    
    160,900
    
    
    
    170,900
    
    
    
    170,900Stockholders equity
    
    
    90,728
    
    
    
    88,018
    
    
    
    86,558
 
 (1)
    
    Annualized(2)
    
    Net interest income divided by average interest-earning assets. 46




---



##### 



March 31,
    
    December 31,
    
    September 30,
    
    June 30,
    
    March 31,(Dollars in thousands, except per
share data)
    
    2005
    
    2004
    
    2004
    
    2004
    
    2004Selected
Operations Data (3 months ended):Interest income
    
    
    14,196
    
    
    
    13,678
    
    
    
    13,156
    
    
    
    12,427
    
    
    
    12,355Interest expense
    
    
    5,525
    
    
    
    5,428
    
    
    
    5,387
    
    
    
    5,060
    
    
    
    5,118Net interest income
    
    
    8,671
    
    
    
    8,250
    
    
    
    7,769
    
    
    
    7,367
    
    
    
    7,237Provision for loan losses
    
    
    636
    
    
    
    714
    
    
    
    775
    
    
    
    447
    
    
    
    819Net interest income after provision for loan losses
    
    
    8,035
    
    
    
    7,536
    
    
    
    6,994
    
    
    
    6,920
    
    
    
    6,418Noninterest income:Fees and service charges
    
    
    603
    
    
    
    762
    
    
    
    742
    
    
    
    705
    
    
    
    568Loan servicing fees
    
    
    293
    
    
    
    299
    
    
    
    292
    
    
    
    291
    
    
    
    287Securities gains (losses), net
    
    
    0
    
    
    
    (539
    )
    
    
    3
    
    
    
    1
    
    
    
    0Gain on sales of loans
    
    
    293
    
    
    
    435
    
    
    
    349
    
    
    
    507
    
    
    
    412Losses in limited partnerships
    
    
    (8
    )
    
    
    (7
    )
    
    
    (7
    )
    
    
    (7
    )
    
    
    (6
    )Other noninterest income
    
    
    245
    
    
    
    212
    
    
    
    210
    
    
    
    183
    
    
    
    275Total noninterest income
    
    
    1,426
    
    
    
    1,162
    
    
    
    1,589
    
    
    
    1,680
    
    
    
    1,536Noninterest expense:Compensation and benefits
    
    
    2,774
    
    
    
    2,646
    
    
    
    2,430
    
    
    
    2,582
    
    
    
    2,528Occupancy
    
    
    995
    
    
    
    960
    
    
    
    914
    
    
    
    871
    
    
    
    885Deposit insurance premiums
    
    
    28
    
    
    
    25
    
    
    
    24
    
    
    
    28
    
    
    
    19Advertising
    
    
    84
    
    
    
    139
    
    
    
    116
    
    
    
    88
    
    
    
    87Data processing
    
    
    238
    
    
    
    278
    
    
    
    233
    
    
    
    228
    
    
    
    191Amortization of mortgage servicing rights, net
    
    
    239
    
    
    
    266
    
    
    
    240
    
    
    
    302
    
    
    
    253Other noninterest expense
    
    
    932
    
    
    
    1,045
    
    
    
    923
    
    
    
    898
    
    
    
    962Total noninterest expense
    
    
    5,290
    
    
    
    5,359
    
    
    
    4,880
    
    
    
    4,997
    
    
    
    4,925Income before income tax expense
    
    
    4,171
    
    
    
    3,339
    
    
    
    3,703
    
    
    
    3,603
    
    
    
    3,029Income tax expense
    
    
    1,356
    
    
    
    1,218
    
    
    
    1,153
    
    
    
    1,106
    
    
    
    910Income before minority interest
    
    
    2,815
    
    
    
    2,121
    
    
    
    2,550
    
    
    
    2,497
    
    
    
    2,119Minority interest
    
    
    0
    
    
    
    (1
    )
    
    
    0
    
    
    
    0
    
    
    
    (2
    )Net income
    
    
    2,815
    
    
    
    2,122
    
    
    
    2,550
    
    
    
    2,497
    
    
    
    2,121Basic earnings per share
    
    
    0.74
    
    
    
    0.55
    
    
    
    0.66
    
    
    
    0.65
    
    
    
    0.54Diluted earnings per share
    
    
    0.70
    
    
    
    0.53
    
    
    
    0.64
    
    
    
    0.62
    
    
    
    0.52Financial Ratios:Return on average assets(1)
    
    
    1.18
    
    
    
    0.88
    
    
    
    1.09
    
    
    
    1.12
    
    
    
    0.96Return on average equity(1)
    
    
    13.22
    
    
    
    9.85
    
    
    
    12.02
    
    
    
    12.06
    
    
    
    10.21Average equity to average assets
    
    
    8.92
    
    
    
    9.17
    
    
    
    9.23
    
    
    
    9.34
    
    
    
    9.42Dividend payout ratio
    
    
    41.51
    
    
    
    34.38
    
    
    
    35.48
    
    
    
    38.46
    
    
    
    37.74Net interest margin(1)(2)
    
    
    3.79
    
    
    
    3.62
    
    
    
    3.47
    
    
    
    3.45
    
    
    
    3.46(Dollars in thousands)Selected Financial Condition Data:Total assets
    
    
    991,326
    
    
    
    960,673
    
    
    
    955,335
    
    
    
    914,098
    
    
    
    899,725Securities available for sale:Mortgage-backed and related securities
    
    
    8,470
    
    
    
    9,151
    
    
    
    9,393
    
    
    
    9,882
    
    
    
    11,937Other marketable securities
    
    
    90,980
    
    
    
    94,522
    
    
    
    95,404
    
    
    
    99,947
    
    
    
    97,066Loans held for sale
    
    
    1,510
    
    
    
    2,712
    
    
    
    3,652
    
    
    
    3,767
    
    
    
    4,955Loans receivable, net
    
    
    813,244
    
    
    
    783,213
    
    
    
    766,063
    
    
    
    722,800
    
    
    
    717,021Deposits
    
    
    727,815
    
    
    
    698,902
    
    
    
    666,752
    
    
    
    627,305
    
    
    
    611,656Federal Home Loan Bank advances
    
    
    170,900
    
    
    
    170,900
    
    
    
    198,900
    
    
    
    198,900
    
    
    
    198,900Stockholders equity
    
    
    84,488
    
    
    
    83,771
    
    
    
    82,791
    
    
    
    81,127
    
    
    
    82,148
 47




---



##### 



OTHER FINANCIAL DATA
 Year Ended December 31,(Dollars in thousands)
    
    2005
    
    2004
    
    2003Maximum Balance:Federal Home Loan Bank advances
    
    $
    193,900
    
    
    
    214,800
    
    
    
    241,800Federal Home Loan Bank short-term borrowings
    
    
    33,000
    
    
    
    43,900
    
    
    
    69,400Average Balance:Federal Home Loan Bank advances
    
    
    170,919
    
    
    
    196,008
    
    
    
    221,510Federal Home Loan Bank short-term borrowings
    
    
    10,047
    
    
    
    26,918
    
    
    
    41,169
  December 31,2005
    
    
    2004
    
    
    2003Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    Average(Dollars in thousands)
    
    Amount
    
    
    Rate
    
    
    Amount
    
    
    Rate
    
    
    Amount
    
    
    RateFHLB short-term borrowings
    
    $
    0
    
    
    
    0.00
    %
    
    $
    10,000
    
    
    
    2.69
    %
    
    $
    33,000
    
    
    
    5.01
    %Other FHLB long-term
advances
    
    
    160,900
    
    
    
    4.29
    
    
    
    160,900
    
    
    
    4.29
    
    
    
    170,900
    
    
    
    4.20Total
    
    $
    160,900
    
    
    
    4.29
    
    
    $
    170,900
    
    
    
    4.20
    
    
    $
    203,900
    
    
    
    4.33
  COMMON
STOCK INFORMATION
  Dec. 30,
    
    Sept. 30,
    
    June 30,
    
    March 31,
    
    Dec. 31,
    
    Sept. 30,
    
    June 30,
    
    March 31,2005
    
    2005
    
    2005
    
    2005
    
    2004
    
    2004
    
    2004
    
    2004HIGH
    
    $
    32.00
    
    
    
    32.39
    
    
    
    32.00
    
    
    
    33.06
    
    
    
    33.50
    
    
    
    27.99
    
    
    
    27.65
    
    
    
    28.19LOW
    
    
    28.14
    
    
    
    30.75
    
    
    
    28.55
    
    
    
    29.70
    
    
    
    27.35
    
    
    
    25.10
    
    
    
    24.51
    
    
    
    23.25CLOSE
    
    
    29.50
    
    
    
    31.92
    
    
    
    31.48
    
    
    
    31.00
    
    
    
    32.99
    
    
    
    27.75
    
    
    
    27.09
    
    
    
    27.48
 Dec. 31,
    
    Sept. 30,
    
    June 30,
    
    March 31,
    
    Dec. 31,
    
    Sept. 30,
    
    June 28,
    
    March 29,2003
    
    2003
    
    2003
    
    2003
    
    2002
    
    2002
    
    2002
    
    2002HIGH
    
    $
    24.70
    
    
    
    21.63
    
    
    
    20.04
    
    
    
    16.82
    
    
    
    18.14
    
    
    
    19.31
    
    
    
    20.25
    
    
    
    16.17LOW
    
    
    20.00
    
    
    
    19.36
    
    
    
    15.85
    
    
    
    15.55
    
    
    
    15.78
    
    
    
    16.50
    
    
    
    15.90
    
    
    
    15.24CLOSE
    
    
    24.29
    
    
    
    21.50
    
    
    
    19.40
    
    
    
    16.05
    
    
    
    16.82
    
    
    
    17.46
    
    
    
    19.06
    
    
    
    16.05
 Dec. 31,
    
    Sept. 28,
    
    June 29,
    
    March 30,
    
    Dec. 29,
    
    Sept. 29,
    
    June 30,
    
    March 31,2001
    
    2001
    
    2001
    
    2001
    
    2000
    
    2000
    
    2000
    
    2000HIGH
    
    $
    15.85
    
    
    
    17.10
    
    
    
    17.15
    
    
    
    15.06
    
    
    
    13.25
    
    
    
    13.88
    
    
    
    11.75
    
    
    
    12.13LOW
    
    
    13.27
    
    
    
    14.35
    
    
    
    13.50
    
    
    
    13.00
    
    
    
    12.31
    
    
    
    10.88
    
    
    
    10.13
    
    
    
    9.63CLOSE
    
    
    15.49
    
    
    
    15.10
    
    
    
    17.10
    
    
    
    14.75
    
    
    
    13.06
    
    
    
    12.44
    
    
    
    11.00
    
    
    
    10.13
 48