SECURITIES AND EXCHANGE COMMISSION 
Washington, D.C. 21549 
 
FORM 10-K 
 
[X] ANNUAL REPORT PURSUANT TO SECTION 13  
OR 15(d) OF 
THE SECURITIES AND EXCHANGE ACT OF 1934 (FEE  
REQUIRED) 
For fiscal year ended December 31, 1996 
OR 
TRANSITION REPORT PURSUANT TO SECTION 13  
OR 15(d) OF THE 
SECURITIES AND EXCHANGE ACT OF 1934 (NO FEE REQUIRED) 
For transition period from 		 to 		 
 
Commission File Number 0-21878 
 
MNB BANCSHARES, INC. 
(Exact name of Registrant as specified in its charter) 
 
Delaware			48-1121026 
(State or other jurisdiction	(I.R.S. Employer Identification Number) 
 of incorporation or organization) 
800 Poyntz Avenue, Manhattan, Kansas	66502 
(Address of principal executive offices)	(Zip Code) 
 
(913) 565-2100 
(Registrant's telephone number, including area code) 
 
Securities registered pursuant to Section 12(b) of the Act: 
 
Name of Each Exchange  
on which Registered	None 
Title of Each Class	None 
Securities registered pursuant to Section 12(g) of the Act: 
 
Common Stock, par value $0.01 per share 
(Title of Class) 
 
Indicate by check mark whether the Registrant (1) has filed all reports to be  
filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934  
during the preceding 12 months (or for such shorter period  that the  
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  YesXNo ___ 
Indicate by check mark if disclosure of delinquent filers pursuant to  
Item 405 of Regulation S-K is not contained herein, and will not be  
contained, to the best of Registrant's knowledge, in definitive proxy or  
information statements incorporated by reference in Part III of this 10-K or  
any amendment to this form 10-K. [ ] 
 
The aggregate market value of voting common stock of Registrant  
held by non-affiliates as of March 17, 1997 was $7,044,220.*  At March  
17, 1997, the total number of shares of common stock outstanding was  
608,839. 
 
Documents incorporated by Reference: 
 
Portions of the 1996 Annual Report to Stockholders for the fiscal  
year ended December 31, 1996, are incorporated by reference into Parts I  
and II hereof, to the extent indicated herein.  Portions of the Proxy  
Statement for the Annual Meeting of Stockholders to be held May 19,  
1997, are incorporated by reference in Part III hereof, to the extent  
indicated herein. 
*	Based on the last reported price of actual transactions in  
Registrant's common stock on March 17, 1997, and reports of beneficial  
ownership prepared by all directors, executive officers and beneficial  
owners of more than 5% of the outstanding shares of common stock of  
Registrant; however, such determination of shares owned by affiliates does  
not constitute an admission of affiliate status or beneficial interest in 
shares of common stock of Registrant. 
 
MNB BANCSHARES, INC. 
 
1996 Form 10-K Annual Report 
 
Table of Contents 
 
PART I 
 
ITEM 1.	BUSINESS		  1 
 
ITEM 2.	PROPERTIES		20 
 
ITEM 3.	LEGAL PROCEEDINGS		20   
 
ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF  
		SECURITY HOLDERS	20 
 
ITEM 5.	MARKET FOR THE COMPANY'S COMMON STOCK  
		AND  	RELATED STOCKHOLDER MATTERS	20 
 
ITEM 6.	SELECTED FINANCIAL DATA		20 
 
ITEM 7.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF  
		FINANCIAL  CONDITION AND RESULTS OF 		 
		OPERATIONS		20 
 
ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTAL  
		DATA		21 
 
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH  
		ACCOUNTANTS ON ACCOUNTING AND  
		FINANCIAL DISCLOSURE	21 
 
ITEM 10.	DIRECTORS AND EXECUTIVE OFFICERS OF  
		THE REGISTRANT		21 
 
ITEM 11.	EXECUTIVE COMPENSATION		22 
 
ITEM 12.	SECURITY OWNERSHIP OF CERTAIN  
		BENEFICIAL OWNERSAND MANAGEMENT	22 
 
ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED  
		TRANSACTIONS		22 
 
ITEM 14.	EXHIBITS, FINANCIAL STATEMENT  
		SCHEDULES, AND REPORTS ON FORM 8-K	22 
 
SIGNATURES			24 
 
 
 
PART I.  
  
ITEM 1.	BUSINESS  
  
REGISTRANT AND ITS SUBSIDIARY  
  
MNB Bancshares, Inc. (the "Company") is a bank holding company  
incorporated   
under the laws of the State of Delaware.  Currently, the Company's business  
consists   
solely of the ownership of Security National Bank, Manhattan, Kansas  (the  
"Bank"). 
The Bank is a wholly-owned subsidiary of the Company and is the successor- 
in-interest to   
Manhattan National Bank, formerly Manhattan Federal Savings and Loan  
Association   
(the "Association"), which, on January 5, 1993, converted concurrently from a  
federal   
mutual savings association to a federal stock savings association (the "Stock   
Conversion") and from a federal stock savings association to a national bank  
(the "Bank   
Conversion") (collectively, the "Conversion").  The Bank has no subsidiaries.   
The term   
"Bank", as used in this Form 10-K, sometimes refers to the Association during  
the period   
prior to the Conversion.  
  
	The Company was organized on August 27, 1992, at the direction of  
the Board of   
Directors of the Association to acquire all of the stock issued by the  
Association upon   
consummation of the Stock Conversion.  On January 5, 1993, in connection  
with the Stock Conversion, the Company issued and sold 462,875 shares of its  
common stock, par value  $0.01 per share, in a Subscription and Community  
Offering to the Company's employee  stock ownership plan, the Association's  
members and the general public.  Total net  proceeds of the Subscription and  
Community Offering, after Conversion expenses of  approximately $600,000,  
were approximately $4 million.  The Company utilized $2  million of the net  
proceeds to acquire all of the common stock, par value $1.00 per share,   
issued by the Association in connection with the Stock Conversion.  The  
remaining net  proceeds were then invested by the Company in interest  
bearing deposit accounts at the  Bank and in other investment securities.   
 
On April 1, 1995, the Company acquired all of the issued and outstanding  
stock  of Auburn Security Bancshares, Inc. ("Auburn"), which had  
consolidated assets of  approximately $20 million.  The $2 million purchase  
price, including related costs of  acquisition, included cash of approximately  
$970,000 and 60,720 shares of the  Company's common stock.  Auburn was a  
one-bank holding company which owned 99%  of the outstanding stock of  
Security State Bank, Auburn, Kansas.  Subsequent to the  acquisition, the  
Company acquired all of the remaining stock of Security State Bank.  On   
December 31, 1995, the Company merged and consolidated Manhattan  
National Bank  and Security State Bank into Security National Bank.  In  
February, 1997, the Bank agreed  to lease a facility at 6100 SW 21st Street in  
Topeka, Kansas.  The Bank expects to  commence operations of this branch  
facility in May, 1997.  
  
	As a bank holding company, the Company is subject to regulation by  
the Board  of Governors of the Federal Reserve System (the "Federal Reserve  
Board").  The  Company is also subject to various reporting requirements of  
the Securities and Exchange  Commission (the "SEC").  
  
	Pursuant to the Conversion, the Bank succeeded to all of the assets  
and  
liabilities  of the Association.  The Association was organized as a Kansas- 
chartered mutual building  and loan association in 1885, and converted to a  
federally chartered mutual savings and  loan association in 1938.  The Bank is  
principally engaged in the business of attracting  deposits from the general  
public and using such deposits, together with borrowings and  other funds, to  
originate one-to-four  family residential mortgage loans, multi-family,   
consumer and commercial loans, in the Bank's principal lending area,  
consisting primarily  of Manhattan, Kansas and Auburn, Kansas and the  
surrounding communities in Riley,  Pottawatomie, and Shawnee Counties in  
Kansas.  Since Conversion, the Bank has focused  on originating greater  
numbers and amounts of consumer, commercial, and agricultural  loans.   
Additionally, greater emphasis has been placed on diversification of the  
deposit  mix through expansion of core deposit accounts such as checking,  
savings, and money  market accounts.  The Bank has also diversified its  
geographical markets with the holding  company acquisition of Auburn and  
the merger of the two banks. 
	The results of operations of the Bank are dependent primarily upon net  
interest  income and, to a lesser extent, upon other income derived from loan  
servicing fees and  customer deposit services.  Additional expenses of the  
Bank include general and  administrative expenses such as salaries, employee  
benefits, federal deposit insurance  premiums, occupancy and related  
expenses.  
  
	Deposits of the Manhattan branch of the Bank are insured by the  
Savings  Association Insurance Fund (the "SAIF") of the Federal Deposit  
Insurance Corporation  (the "FDIC") up to the maximum amount allowable  
under applicable federal laws and  regulations.  Deposits of the Auburn branch  
of the Bank are insured by the Bank  Insurance Fund (the "BIF").  The Bank  
is regulated by the Office of the Comptroller of  the Currency (the "OCC"), as  
the chartering authority for national banks, and the FDIC,  as the  
administrator of the SAIF and the BIF.  The Bank is also subject to regulation  
by  the Federal Reserve Board with respect to reserves required to be  
maintained against  deposits and certain other matters.  The Bank is a member  
of the Federal Reserve Bank of  Kansas City and the Federal Home Loan  
Bank (the "FHLB") of Topeka.  
  
	The Company's executive office is located at 800 Poyntz Avenue,  
Manhattan,  Kansas 66502.  Its telephone number is (913) 565-2000.  
  
Market Area  
  
	The Bank's home office is located at 800 Poyntz Avenue, Manhattan,  
Kansas,  with a branch located at 1741 N. Washington, Auburn, Kansas.  
Manhattan is located in  east central Kansas, approximately 45 miles west of  
Topeka, Kansas.  Manhattan is the  county seat and largest city in Riley  
County, Kansas.  Over the past decade, Riley  County  has experienced  
population and household growth at an annual rate which is slightly  higher  
than the growth rates for Kansas in general.  Auburn is located ten miles  
southwest  of Topeka, Kansas and in an area experiencing the growth and  
expansion of the  metropolitan Topeka area.  
  
	The Bank's primary deposit gathering and lending market consists of  
Riley,  Pottawatomie, and Shawnee Counties, Kansas.  Riley County's  
economy is significantly  influenced by employment at Fort Riley Military  
Base and Kansas State University, the  second largest university in Kansas,  
which is located in Manhattan.  Shawnee County's  economy is strongly  
influenced by the City of Topeka, which is the state capital, and  several major
private firms and public institutions.  
  
	Other sources of employment in the Manhattan branch's market area  
are derived  from a variety of service, trade and manufacturing employers  
located in southern Riley  County and western Pottawatomie County,  
including the Unified School District, the  Kansas Farm Bureau and the  
McCall Pattern Company.  Northern Riley County and  eastern Pottawatomie  
County are primarily rural, agricultural areas.  Other sources of  employment  
in the Auburn and Topeka market areas are numerous manufacturing,   
distribution, and retail centers located in Shawnee County.  These include  
Goodyear Tire  & Rubber; Blue Cross/Blue Shield; Volume Shoe  
Corporation; the Menninger  Foundation; and Washburn University. Others in  
the Topeka area include Frito-Lay, Inc.;  Southwestern Bell Corporation; the  
Veteran's Administration; and Hill's Pet Food.  
   
Competition  
  
	The Bank faces strong competition both in attracting deposits and  
making real  estate and other loans.  Its most direct competition for deposits  
comes from commercial  banks and other savings institutions located in its  
principal market areas of Riley,  Pottawatomie, and Shawnee Counties in  
Kansas, including many large financial  institutions which have greater  
financial and marketing resources available to them.  The  ability of the Bank  
to attract and retain deposits generally depends on its ability to provide  a  
rate  
of return, liquidity and risk comparable to that offered by competing  
investment  opportunities.  The Bank competes for loans principally through  
the interest rates and loan  fees it charges and the efficiency and quality of  
services it provides borrowers.  Additionally, competition may increase as a  
result of the continuing reduction on  restrictions on the interstate operations
of financial institutions.  Pursuant to federal  legislation which took effect  
on  
September 25, 1995, the Federal Reserve Board may  allow a bank holding  
company to acquire banks located in any state in the United States  without  
regard to geographic restrictions or reciprocity requirements imposed by 
state   
law, but subject to certain conditions, including certain deposit 
concentration  
limits.  See  "Supervision and Regulation - The Company - Investments and  
Activities."  Further,  pursuant to a federal statute which will take effect 
on  
June 1, 1997, banks will be able to  establish branch offices in other 
states.   
See "Supervision and Regulation - The Bank -  Branching Authority."   
Employees  
  
	At December 31, 1996, the Bank had a total of 42 employees (37 full  
time  equivalent employees).  The Company has no direct employees.   
Employees are provided  with a comprehensive benefits program, including  
basic and major medical insurance, life  and disability insurance, sick leave,  
an  
employee stock ownership plan and a 401(k) profit  sharing plan.  Employees  
are not represented by any union or collective bargaining group  and the Bank  
considers its employee relations to be good.  
  
SUPERVISION AND REGULATION  
  
General  
 
	Financial institutions and their holding companies are extensively  
regulated under  federal and state law.  As a result, the growth and earnings  
performance of the Company  can be affected not only by management  
decisions and general economic conditions, but  also by the requirements of  
applicable state and federal statutes and regulations and the  policies of  
various governmental regulatory authorities including, but not limited to, 
the   
OCC, the Federal Reserve Board, the FDIC, the Internal Revenue Service and  
state taxing  authorities and the SEC. The effect of such statutes, 
regulations  
and policies can be  significant, and cannot be predicted with a high degree 
of  certainty. 
	Federal and state laws and regulations generally applicable to financial   
institutions, such as the Company and the Bank, regulate, among other things,  
the scope of  business, investments, reserves against deposits, capital levels  
relative to operations, the  nature and amount of collateral for loans, the  
establishment of branches, mergers,  consolidations and dividends. The system  
of supervision and regulation applicable to the  Company and the Bank  
establishes a comprehensive framework for their respective  operations and is  
intended primarily for the protection of the FDIC's deposit insurance  funds  
and the depositors, rather than the shareholders, of financial institutions.  
  
	The following references to material statutes and regulations affecting  
the  Company and its subsidiaries are brief summaries thereof and do not  
purport to be  complete, and are qualified in their entirety by reference to  
such  
statutes and regulations.  Any change in applicable law or regulations may  
have a material effect on the business of  the Company and the Bank.  Recent  
Regulatory Developments  
  
	On September 30, 1996, President Clinton signed into law the  
"Economic  Growth and Regulatory Paperwork Reduction Act of 1996" (the  
"Regulatory Reduction  Act").  Subtitle G of the Regulatory Reduction Act  
consists of the "Deposit Insurance  Funds Act of 1996" (the "DIFA").  The  
DIFA provides for a one-time special assessment  on each depository  
institution holding deposits subject to assessment by the FDIC for the  SAIF 
in  
an amount which, in the aggregate, will increase the designated reserve ratio  
of  the SAIF (i.e., the ratio of the insurance reserves of the SAIF to total  
SAIF-insured  deposits) to 1.25% on October 1, 1996.  Subject to certain  
exceptions, the special  assessment was payable in full on November 27, 1996.   
The Bank holds SAIF-assessable  deposits acquired from the Association.   
Thus, the Bank was subject to the special  assessment with respect to those  
deposits.  
  
	Under the DIFA, the amount of the special assessment payable by an  
institution  was determined on the basis of the amount of SAIF-assessable  
deposits held by the  institution on March 31, 1995, or acquired by the  
institution after March 31, 1995 from  another institution which held the  
deposits on March 31, 1995, but was no longer in  existence on November 27,  
1996.  The DIFA provides for a 20% discount in calculating  the SAIF- 
assessable deposits of certain "Oakar" banks (i.e., BIF member banks that 
hold   
deposits acquired from a SAIF member that remain SAIF insured) and certain   
"Sasser"  banks (i.e., institutions that converted from thrift to bank 
charters  
but remain SAIF  members).  The FDIC determined that the Bank qualified  
for the 20% discount provided  by the DIFA for "Oakar" banks.  The DIFA  
also exempts certain institutions from  payment of the special assessment  
(including institutions that are undercapitalized or that  would become  
undercapitalized as a result of payment of the special assessment), and  
allows  
an institution to pay the special assessment in two installments if there is 
a   
significant risk that by paying the special assessment in a lump sum, the  
institution or its  holding company would be in default under or in violation  
of  
terms or conditions of debt  obligations or preferred stock issued by the  
institution or its holding company and  outstanding on September 13, 1995.  
  
	On October 8, 1996, the FDIC adopted a final regulation  
implementing the SAIF  special assessment.  In that regulation, the FDIC set  
the special assessment rate at 0.657%  of SAIF-assessable deposits held on  
March 31, 1995. The amount of the special  assessment paid by the Bank was  
$449,000, the full amount of which was recorded as a  charge against earnings  
for the quarter ended September 30, 1996.  As discussed below,  however, the  
recapitalization of the SAIF resulting from the special assessment should   
significantly reduce the Bank's ongoing deposit insurance expense.  
  
	In light of the recapitalization of the SAIF pursuant to the special  
assessment  authorized by the DIFA, the FDIC, on December 11, 1996, took  
action to reduce regular  semi-annual SAIF assessments from the range of  
0.23% - 0.31% of deposits to a range of  0% - 0.27% of deposits.  The new  
rates were effective October 1, 1996 for Oakar and  Sasser banks, but did not  
take effect for other SAIF-assessable institutions until January  1, 1997.   
From  
October 1, 1996 through December 31, 1996, assessments payable by  SAIF- 
assessable institutions other than Oakar and Sasser banks ranged from 0.18%  
to  0.27% of deposits, which represents the amount the FDIC calculates as  
necessary to cover  the interest due for that period on outstanding 
obligations  
of the Financing Corporation  (the "FICO"), discussed below.  Because SAIF- 
assessable institutions were previously  assessed at higher rates (i.e., 
0.23% -  
0.31% of deposits) for the semi-annual period  ending December 31, 1996, the  
FDIC will refund or credit back the amount collected from  such institutions  
for the period from October 1, 1996 through December 31, 1996 which   
exceeds the amount due for that period under the reduced assessment  
schedule.  As a  result of the FDIC's action, the deposit insurance 
assessments  
payable by the Bank with  respect to its SAIF-assessable deposits have been  
reduced substantially, to the same levels  paid by the Bank with respect to 
its BIF-assessable deposits.  
  
	Prior to the enactment of the DIFA, a substantial amount of the SAIF  
assessment  revenue was used to pay the interest due on bonds issued by the  
FICO, the entity created  in 1987 to finance the recapitalization of the 
Federal 
Savings and Loan Insurance  Corporation (the "FSLIC"), the SAIF's  
predecessor insurance fund. Pursuant to the  DIFA, the interest due on  
outstanding FICO bonds will be covered by assessments against  both SAIF  
and BIF member institutions beginning January 1, 1997.  Between January 1,   
1997 and December 31, 1999, FICO assessments against BIF-member  
institutions cannot  exceed 20% of the FICO assessments charged SAIF- 
member institutions.  From January  1, 2000 until the FICO bonds mature in  
2019, FICO assessments will be shared by all  FDIC-insured institutions on a  
pro rata basis.  It has been estimated that the FICO  assessments for the 
period 
January 1, 1997 through December 31, 1999 will be  approximately 0.013%  
of deposits for BIF members versus approximately 0.064% of  deposits for  
SAIF members, and will be less than 0.025% of deposits thereafter.  
  
	The DIFA also provides for a merger of the BIF and the SAIF on  
January 1,  1999, provided there are no state or federally chartered, FDIC- 
insured savings  associations existing on that date.  To facilitate the merger 
of 
the BIF and the SAIF, the  DIFA directs the Treasury Department to conduct  
a study on the development of a  common charter and to submit a report,  
along with appropriate legislative  recommendations, to the Congress by  
March 31, 1997.   
	In addition to the DIFA, the Regulatory Reduction Act includes a  
number of  statutory changes designed to eliminate duplicative, redundant or  
unnecessary regulatory  requirements. Among other things, the Regulatory  
Reduction Act establishes streamlined  notice procedures for the  
commencement of new nonbanking activities by bank holding  companies,  
eliminates the need for national banks to obtain OCC approval to establish   
off-site ATMs, excludes ATM closures and certain branch office relocations  
from the  prior notice requirements applicable to branch closings and  
significantly expands the  authority of well-capitalized and well-managed  
national banks to invest in office premises  without prior regulatory 
approval.  
  
The Regulatory Reduction Act also clarifies the  liability of a financial  
institution, when acting as a lender or in a fiduciary capacity, under  the  
federal environmental laws. Although the full impact of the Regulatory  
Reduction Act  on the operations of the Company and the Bank cannot be  
determined at this time,  management believes that the legislation may reduce  
compliance costs to some extent and  allow the Company and the  Bank  
somewhat greater operating flexibility.   
  
The Company   
  
	General.  The Company, as the sole stockholder of the Bank, is a bank  
holding  company.  As a bank holding company, the Company is registered  
with, and is subject to  regulation by, the Federal Reserve Board under the  
Bank Holding Company Act, as  amended (the "BHCA").  In accordance with  
Federal Reserve Board policy, the Company  is expected to act as a source of  
financial strength to the Bank and to commit resources to  support the Bank in  
circumstances where the Company might not do so absent such  policy.   
Under the BHCA, the Company is subject to periodic examination by the  
Federal  Reserve Board and is required to file with the Federal Reserve Board  
periodic reports of  its operations and such additional information as the  
Federal Reserve Board may require.  
  
	Investments and Activities. Under the BHCA, a bank holding company  
must  obtain Federal Reserve Board approval before:  (i) acquiring, directly 
or  
indirectly,  ownership or control of any voting shares of another bank or bank  
holding company if,  after such acquisition, it would own or control more than  
5% of such shares (unless it  already owns or controls the majority of such  
shares); (ii) acquiring all or substantially all  of the assets of another 
bank; or  
(iii) merging or consolidating with another bank holding  company.  Subject to  
certain conditions (including certain deposit concentration limits  
established  
by the BHCA), the Federal Reserve Board may allow a bank holding   
company to acquire banks located in any state of the United States without  
regard to  whether the acquisition is prohibited by the law of the state in  
which  
the target bank is  located.  In approving interstate acquisitions, however, 
the  
Federal Reserve Board is  required to give effect to applicable state law  
limitations on the aggregate amount of  deposits that may be held by the  
acquiring bank holding company and its insured  depository institution  
affiliates in the state in which the target bank is located or which  require  
that  
the target bank have been in existence for a minimum period of time (not to   
exceed five years) before being acquired by an out-of-state bank holding  
company.   
  
	The BHCA also prohibits, with certain exceptions, the Company from  
acquiring  direct or indirect ownership or control of more than 5% of the  
voting shares of any  company which is not a bank and from engaging in any  
business other than that of  banking, managing and controlling banks or  
furnishing services to banks and their  subsidiaries.  The principal exception  
to  
this prohibition allows bank holding companies to  engage in, and to own  
shares of companies engaged in, certain businesses found by the  Federal  
Reserve Board to be "so closely related to banking ... as to be a proper  
incident  thereto."  Under current regulations of the Federal Reserve Board,  
the Company and its  non-bank subsidiaries are permitted to engage in, among  
other activities, such banking- related businesses as the operation of a 
thrift, 
  
sales and consumer finance, equipment  leasing, the operation of a computer  
service bureau, including software development, and  mortgage banking and  
brokerage.  The BHCA generally does not place territorial  restrictions on the  
activities of non-bank subsidiaries of bank holding companies.  
  
	Federal legislation also prohibits acquisition of "control" of a bank or  
bank  holding company, such as the Company, without prior notice to certain  
federal bank  regulators.  "Control" is defined in certain cases as acquisition 
 of  
10% of the outstanding  shares of a bank or bank holding company.  
  
	Capital Requirements. Bank holding companies are required to  
maintain  minimum levels of capital in accordance with Federal Reserve Board  
capital adequacy  guidelines.  If capital falls below minimum guideline 
levels,  a  
bank holding company,  among other things, may be denied approval to  
acquire or establish additional banks or  non-bank businesses.  
  
	The Federal Reserve Board's capital guidelines establish the following  
minimum  regulatory capital requirements for bank holding companies:  a risk- 
based requirement  expressed as a percentage of total risk-weighted assets,  
and a leverage requirement  expressed as a percentage of total assets.  The  
risk-based requirement consists of a  minimum ratio of total capital to total  
risk-weighted assets of 8%, of which at least  one-half must be Tier 1 
capital.  
  
The leverage requirement consists of a minimum ratio of  Tier 1 capital to  
total assets of 3% for the most highly rated companies, with minimum   
requirements of 4% to 5% for all others.  For purposes of these capital  
standards, Tier 1  capital consists primarily of permanent stockholders' 
equity  
less intangible assets (other  than certain mortgage servicing rights and  
purchased credit card relationships) and total  capital means Tier 1 capital  
plus  
certain other debt and equity instruments which do not  qualify as Tier 1  
capital and a portion of the company's allowance for loan and lease  losses. 
  
	The risk-based and leverage standards described above are minimum   
requirements, and higher capital levels will be required if warranted by the  
particular  circumstances or risk profiles of individual banking 
organizations.  
  
Further, any banking  organization experiencing or anticipating significant  
growth would be expected to  maintain capital ratios, including tangible  
capital positions (i.e., Tier 1 capital less all  intangible assets), well  
above  
the  
minimum levels.  
	Under the Federal Reserve Board's guidelines, the capital standards  
described  above generally apply on a consolidated basis to bank holding  
companies that have more  than $150 million in total consolidated assets and  
on a bank-only basis to bank holding  companies that, like the Company, have  
less than $150 million in total consolidated  assets.  The Company's total  
capital of $11.3 million is, however, well in excess of the  Federal Reserve  
Board's consolidated minimum capital requirements.   
  
	Dividends. The Federal Reserve Board has issued a policy statement  
with  regard to the payment of cash dividends by bank holding companies.  In  
the policy  statement, the Federal Reserve Board expressed its view that a  
bank holding company  should not pay cash dividends exceeding its net  
income or which can only be funded in  ways that weaken the bank holding  
company's financial health, such as by borrowing. Additionally, the Federal  
Reserve Board possesses enforcement powers over bank holding  companies  
and their non-bank subsidiaries to prevent or remedy actions that represent   
unsafe or unsound practices or violations of applicable statutes and  
regulations.  Among  these powers is the ability to proscribe the payment of  
dividends by banks and bank  holding companies.  In addition to the  
restrictions on dividends that may be imposed by  the Federal Reserve Board,  
the Delaware General Corporation Law would allow the  Company to pay  
dividends only out of its surplus, or if the Company has no such surplus,  out  
of its net profits for the fiscal year in which the dividend is declared and/or 
the preceding fiscal year.  
  
	Federal Securities Regulation.  The Company's common stock is  
registered with  the SEC under the Securities Act of 1933, as amended, and  
the Securities Exchange Act  of 1934, as amended (the "Exchange Act").   
Consequently, the Company is subject to the  information, proxy solicitation,  
insider trading and other restrictions and requirements of  the SEC under the  
Exchange Act.  
  
The Bank   
  
	General. The Bank is a national bank, chartered by the OCC under the  
National  Bank Act.  The deposit accounts of the Bank are insured by the BIF  
of the FDIC, and it is  a member of the Federal Reserve System.  As a BIF- 
insured national bank, the Bank is  subject to the examination, supervision,  
reporting and enforcement requirements of the  OCC, as the chartering  
authority for national banks, and the FDIC, as administrator of the  BIF.  The  
Bank is also a member of the FHLB, which provides a central credit facility   
primarily for member institutions.  
  
	Deposit Insurance.  As an FDIC-insured institution, the Bank is  
required to pay  deposit insurance premium assessments to the FDIC.  The  
FDIC has adopted a risk-based  assessment system under which all insured  
depository institutions are placed into one of  nine categories and assessed  
insurance premiums based upon their respective levels of  capital and  
supervisory evaluations.  Institutions classified as well-capitalized (as  
defined   
by the FDIC) and considered healthy pay the lowest premium while  
institutions that are  less than adequately capitalized (as defined by the  
FDIC)  
and considered of substantial  supervisory concern pay the highest premium.   
Risk classification of all insured  institutions is made by the FDIC for each  
semi-annual assessment period.  
  
	Although the Bank is a BIF member, approximately 80% of the Bank's  
deposits  (representing the portion of the Bank's deposit base acquired from  
the Association which  continues to be SAIF insured), are subject to  
assessment at SAIF rates.  During the year  ended December 31, 1996, BIF  
assessments ranged from 0% of deposits to 0.27% of  deposits.  The FDIC  
has announced that for the semi-annual assessment period beginning  January  
1, 1997, BIF assessment rates will continue to range from 0% of deposits to   
0.27% of deposits.  During the period January 1, 1996 through September 30,  
1996, SAIF  assessments ranged from 0.23% of deposits to 0.31% of  
deposits.  As a result of the  recapitalization of the SAIF, SAIF assessments  
paid by Oakar banks, such as the Bank,  were reduced effective October 1,  
1996 to a range of 0% of deposits to 0.27% of deposits. See "--Recent  
Regulatory Developments."  
  
	The FDIC may terminate the deposit insurance of any insured  
depository  institution if the FDIC determines, after a hearing, that the  
institution has engaged or is  engaging in unsafe or unsound practices, is in  
an  
unsafe or unsound condition to continue  operations or has violated any  
applicable law, regulation, order, or any condition imposed  in writing by, or  
written agreement with, the FDIC.  The FDIC may also suspend deposit   
insurance temporarily during the hearing process for a permanent termination  
of insurance  if the institution has no tangible capital.  Management of the  
Company is not aware of any  activity or condition that could result in  
termination of the deposit insurance of the Bank.  
  
	FICO Assessments.  Since 1987, a portion of the deposit insurance  
assessments  paid by SAIF members has been used to cover interest payments  
due on the outstanding  obligations of the FICO, the entity created to finance  
the recapitalization of the FSLIC,  the SAIF's predecessor insurance fund.   
Pursuant to federal legislation enacted September  30, 1996, commencing  
January 1, 1997, both SAIF members and BIF members will be  subject to  
assessments to cover the interest payment on outstanding FICO obligations.  
Such FICO assessments will be in addition to amounts assessed by the FDIC  
for deposit  insurance.  Until January 1, 2000, the FICO assessments made  
against BIF members may  not exceed 20% of the amount of the FICO  
assessments made against SAIF members.  It  is estimated that SAIF members  
will pay FICO assessments equal to 0.064% of deposits  while BIF members  
will pay FICO assessments equal to 0.013% of deposits.  Between  January 1,  
2000 and the maturity of the outstanding FICO obligations in 2019, BIF   
members and SAIF members will share the cost of the interest on the FICO  
bonds on a  pro rata basis.  It is estimated that FICO assessments during this  
period will be less than  0.025% of deposits.  
  
	OCC Assessments.  National banks are required to pay supervisory  
fees to the  OCC to fund the operations of the OCC.  The amount of such  
supervisory fees is based  upon each institution's total assets, including  
consolidated subsidiaries, as reported to the  OCC.  During the year ended  
December 31, 1996, the Bank paid supervisory fees to the  OCC totaling  
$39,139.  
  
	Capital Requirements. The OCC has established the following  
minimum  capital standards for national banks, such as the Bank:  a leverage  
requirement consisting  of a minimum ratio of Tier 1 capital to total assets 
of  
3% for the most highly-rated banks  with minimum requirements of 4% to 5%  
for all others, and a risk-based capital  requirement consisting of a minimum  
ratio of total capital to total risk-weighted assets of  8%, at least one-half  
of which must be Tier 1 capital.  For purposes of these capital  standards, 
Tier 1 capital and total capital consist of substantially the same components 
as Tier 1 capital and total capital under the Federal Reserve Board's capital  
guidelines for bank holding companies (see "--The Company--Capital 
Requirements"). 
  
	The capital requirements described above are minimum requirements.   
Higher  capital levels will be required if warranted by the particular  
circumstances or risk profiles  of individual institutions.  For example, the  
regulations of the OCC provide that additional  capital may be required to  
take adequate account of interest rate risk or the risks posed by   
concentrations of credit, nontraditional activities or securities trading  
activities.   
  
	During the year ended December 31, 1996, the Bank was not required  
by the  OCC to increase its capital to an amount in excess of the minimum  
regulatory  requirements.  As of December 31, 1996, the Bank exceeded its  
minimum regulatory  capital requirements with a leverage ratio of 8.70% and  
a risk-based capital ratio of  18.22% compared to a required ratio of 4.00%  
and 8.00%, respectively.  
  
	Federal law provides the federal banking regulators with broad power  
to take  prompt corrective action to resolve the problems of undercapitalized  
institutions.  The  extent of the regulators' powers depends on whether the  
institution in question is "well  capitalized," "adequately capitalized,"  
"undercapitalized," "significantly  undercapitalized" or "critically  
undercapitalized."  Depending upon the capital category to  which an  
institution is assigned, the regulators' corrective powers include:  requiring  
the   
submission of a capital restoration plan; placing limits on asset growth and  
restrictions on  activities; requiring the institution to issue additional  
capital  
stock (including additional  voting stock) or to be acquired; restricting  
transactions with affiliates; restricting the  interest rate the institution  
may pay  
on deposits; ordering a new election of directors of the  institution;  
requiring  
that senior executive officers or directors be dismissed; prohibiting  the  
institution from accepting deposits from correspondent banks; requiring the  
institution  to divest certain subsidiaries; prohibiting the payment of  
principal  
or interest on  subordinated debt; and ultimately, appointing a receiver for  
the  
institution.  
  
	Dividends.  The National Bank Act imposes limitations on the amount  
of  dividends that may be paid by a national bank, such as the Bank. 
Generally,  
a national  bank may pay dividends out of its undivided profits, in such  
amounts and at such times as  the bank's board of directors deems prudent.   
Without prior OCC approval, however, a  national bank may not pay  
dividends in any calendar year which exceed the bank's year- to-date net  
income plus the bank's adjusted retained net income for the two preceding   
years.  
  
	The payment of dividends by any financial institution is affected by the   
requirement to maintain adequate capital pursuant to applicable capital  
adequacy  guidelines and regulations, and a financial institution generally is  
prohibited from paying  any dividends if, following payment thereof, the  
institution would be undercapitalized.  As  described above, the Bank  
exceeded its minimum capital requirements under applicable  guidelines as of  
December 31, 1996.  Further, Bank may not pay dividends in an amount   
which would reduce its capital below the amount required for the liquidation  
account  established in connection with the Association's conversion from the  
mutual to the stock  form of ownership in 1993.As of December 31, 1996,  
approximately $0.8 million was  available to be paid as dividends to the  
Company by the Bank.  Notwithstanding the  availability of funds for  
dividends, however, the OCC may prohibit the payment of any  dividends by  
the Bank if the OCC determines such payment would constitute an unsafe or   
unsound practice.  
  
	Insider Transactions.  The Bank is subject to certain restrictions  
imposed by the  Federal Reserve Act on extensions of credit to the Company  
and its subsidiaries, on  investments in the stock or other securities of the  
Company and its subsidiaries and the  acceptance of the stock or other  
securities of the Company or its subsidiaries as collateral  for loans.  
Certain 
limitations and reporting requirements are also placed on extensions of  
credit  
by the Bank to its directors and officers, to directors and officers of the  
Company  and its subsidiaries, to principal stockholders of the Company, and  
to "related interests" of  such directors, officers and principal  
stockholders.  In  
addition, such legislation and  regulations may affect the terms upon which  
any person becoming a director or officer of  the Company or one of its  
subsidiaries or a principal stockholder of the Company may  obtain credit  
from  
banks with which the Bank maintains a correspondent relationship.  
  
	Safety and Soundness Standards.  The OCC has adopted guidelines  
which  establish operational and managerial standards to promote the safety  
and soundness of  national banks.  The guidelines set forth standards for  
internal controls, information  systems, internal audit systems, loan  
documentation, credit underwriting, interest rate  exposure, asset growth,  
compensation, fees and benefits, asset quality and earnings.  In  general, the  
guidelines prescribe the goals to be achieved in each area, and each  
institution   
is responsible for establishing its own procedures to achieve those goals.   
If an  
institution  fails to comply with any of the standards set forth in the  
guidelines,  
the OCC may require  the institution to submit a plan for achieving and  
maintaining compliance.  The preamble  to the guidelines states that the OCC  
expects to require a compliance plan from an  institution whose failure to 
meet  
one or more of the guidelines is of such severity that it  could threaten the  
safety and soundness of the institution.  Failure to submit an acceptable   
plan,  
or failure to comply with a plan that has been accepted by the OCC, would   
constitute grounds for further enforcement action.  
  
	Branching Authority.  National banks headquartered in Kansas, such  
as the  Bank, have the same branching rights in Kansas as banks chartered  
under Kansas law. Kansas law grants Kansas-chartered banks the authority to  
establish branches anywhere  in the State of Kansas, subject to receipt of all  
required regulatory approvals.   
	Effective June 1, 1997 (or earlier if expressly authorized by applicable  
state  law), the Riegle-Neal Interstate Banking and Branching Efficiency Act  
of 1994 (the  "Riegle-Neal Act") allows banks to establish interstate branch  
networks through  acquisitions of other banks, subject to certain conditions,  
including certain limitations on  the aggregate amount of deposits that may be  
held by the surviving bank and all of its  insured depository institution  
affiliates.  The establishment of de novo interstate branches  or the  
acquisition  
of individual branches of a bank in another state (rather than the  
acquisition  
of an out-of-state bank in its entirety) is allowed by the Riegle-Neal Act  
only   
if specifically authorized by state law.  The legislation allows individual  
states  
to "opt- out" of certain provisions of the Riegle-Neal Act by enacting  
appropriate legislation prior  to June 1, 1997.  Kansas not yet enacted  
legislation either authorizing interstate branching  or opting out of the  
Riegle- 
Neal Act.   
  
	Federal Reserve System.  Federal Reserve Board regulations, as  
presently in  effect, require depository institutions to maintain non-interest  
earning reserves against  their transaction accounts (primarily NOW and  
regular checking accounts), as follows: for transaction accounts aggregating  
$49.3 million or less, the reserve requirement is 3%  of total transaction  
accounts; and for transaction accounts aggregating in excess of $49.3  
million,  
the reserve requirement is $1.479 million plus 10% of the aggregate amount  
of  total transaction accounts in excess of $49.3 million.  The first $4.4  
million  
of otherwise  reservable balances are exempted from the reserve requirements.   
These reserve  requirements are subject to annual adjustment by the Federal  
Reserve Board.  The Bank is  in compliance with the foregoing requirements. 
  
Tax Matters  
  
	Under applicable provisions of the Internal Revenue Code of 1986, as  
amended  ("Code"), effective as of the date of the Association's conversion to  
a bank, a savings  association that met certain definitional tests relating to  
the  
composition of its assets and  the sources of its income ("qualifying savings  
association") was permitted to establish  reserves for bad debts.  A 
qualifying  
savings association generally was permitted to make  annual additions to such  
reserves under either the experience method or the percentage of  taxable  
income method.  In 1996, the percentage of taxable income method was  
repealed  and savings associations were generally required to recapture their  
tax bad debt reserves  in excess of a base year amount.  
  
	As a result of the availability of the percentage of income bad debt  
deduction, the  amount of tax bad debt reserves that qualifying savings  
associations were permitted to  maintain may have exceeded the amount of tax  
bad debt reserves that a bank of  comparable size and portfolio composition  
may maintain.  Consequently, applicable  provisions of Internal Revenue  
Service regulations require that a savings association that  converts to a 
bank  
must restate its tax reserve for bad debts as of the first day of the year   
of the  
conversion.  The restated balance of the reserve is determined by multiplying  
the  savings association's total outstanding loans at the end of the year  
before  
the year of  conversion to a bank by the weighted average ratio of the savings  
association's actual  loan charge-offs during the six years preceding the  
year in  
which the conversion occurs to  total loans outstanding during such six-year  
period.  In general, the excess of the  institution's tax reserve for bad  
debts as  
of the close of the taxable year immediately  preceding the year of conversion  
over the restated reserve level is required to be included  in income ratably  
over six years, beginning with the year of conversion.  As of December  31,  
1992, the Association's actual tax bad debt reserves exceeded the Bank's  
restated  reserves by approximately $1,262,000, which is being included in the  
Bank's taxable  income ratably over a six year period at the rate of  
approximately $210,300 per year. Thus, the restatement gives rise to an  
additional tax liability of approximately $79,900 per  year during the years  
1993 through 1998 (assuming a combined federal and state tax rate  of 38%).   
For financial statement purposes, the Bank recorded a deferred tax liability   
equal to the amount by which the Association's tax bad debt reserve exceeded  
the  allowance for loan losses maintained by the Association in accordance  
with applicable  regulatory requirements.  As of December 31, 1996, this  
deferred tax liability has been  reduced to approximately $160,000 by the  
1993, 1994, 1995 and 1996 payments of  approximately $79,900 each year,  
attributable to the bad debt reserve recapture.  
  
	Delaware imposes a franchise tax on corporations, such as the  
Company, that are  incorporated under the laws of the state of Delaware.  The  
annual Delaware franchise tax  is the least of three tax computations based 
on:  
(1) the number of shares of authorized  capital stock, (2) the corporation's  
assumed capital, or (3) certain minimum and maximum  limits.  
  
	The state of Kansas imposes a privilege tax measured by net income  
on certain  financial institutions, including both banks and savings and loan  
associations, doing  business in Kansas.  The privilege tax consists of a  
normal  
state tax on the bank's "net  income" and a surtax based on the bank's "net  
income" in excess of $25,000.  In general,  "net income" subject to the Kansas  
privilege tax is based on the taxpayer's Federal  taxable income.  The Bank  
was also required to restate its tax bad debt reserves for  purposes of the  
Kansas privilege tax.  The tax and financial statement impact of this   
restatement has been reflected in the use of an assumed combined federal and  
state tax  rate of 38% in calculating the estimated impact of the restatement  
for federal tax  purposes.  
 
I.	Distribution of Assets, Liabilities, and Stockholders' Equity; Interest  
Rates and Interest Differentials  
  
	The average balance sheets are incorporated by reference from the  
Company's 1996 Annual Report to Stockholders  (attached as Exhibit 13.1  
hereto).  The following table describes the extent to which changes in 
interest  
income and interest expense  for major components of interest-earning assets  
and interest-bearing liabilities affected the Bank's interest income and  
expense  
during  the periods indicated.  The table distinguishes between (i) changes  
attributable to rate (changes in rate multiplied by prior volume),  (ii)  
changes  
attributable to volume (changes in volume multiplied by prior rate), and (iii)  
net change (the sum of the previous  columns).  The net changes attributable  
to the combined effect of volume and rate, which cannot be segregated, have  
been allocated  proportionately to the change due to volume and the change  
due to rate. 
 
<TABLE>
<CAPTION> 
                       December 1996 vs 1995			December 1995 
vs 1994 
                          Increase/(Decrease) Attributable to	 
					                        Volume	Rate
	Net			Volume	Rate	Net 
					                               (Dollars in 
thousands)			
Interest income:								 
<S>                           <C>  <C>    <C>   <C>    <C>   <C>
Investment securities			      $64 	$(10)  $54 		 $200  $183 	$383  
Mortgage-backed securities		  139 		10 	  149 			74 		 76 	   150   
Loans	  				                  380 		36 	  416 			710 		397 	  1,107 	  
Total	  				                  583 		36    619 			984 		656 	  1,640 	  
Interest expense: 
Deposits				                  $419	 (148) 271  	 $563  $612 	 $1,175  
Other borrowings			           (27)		(15)	(42)   	(155)	  12    	(143)  
Total	  				                  392 		(163)	229    	408 		624  	  1,032   
Net interest income	 		       $191		$199 	$390  	$576 	$32 	   $608 	  
</TABLE>

<TABLE>
<CAPTION>									  
                              December 1994 vs 1993 
                              Increase/(Decrease) Attributable to			
		 
 
                                   Volume	Rate	Net	 
                               (Dollars in thousands)	 
<S>                            <C>    <C>     <C> 	  
Interest income: 
Investment securities	 	       	$17 		(38)	   $(21) 
Mortgage-backed securities		    83  		5      	88 	 
Loans	  				                    (19)		(149)	  (168)	 
Total                       				81 	 	(182)	  (101)	 

Interest expense:	 
Deposits	                    			$175 		$(234)	$(59) 
Other borrowings             			(239) 		26 	   (213)	 
Total	  			                    	(64)		 (208)  	(272)	 
			  
Net interest income          			$145 		$ 26 	  $171 	 
</TABLE>				  
  
II.  Investment Portfolio  
  
Investments  
  
Investment Securities.  The following table sets forth the carrying value  
of the investment securities portfolio at the dates indicated.  
  
<TABLE> 
<CAPTION>
                              At December 31, 
						                        1996		1995		1994  
							                    (Dollars in thousands)	 

Investment securities:					  
<S>                           <C>      <C>      <C>
U.S. government and agency 
obligations	                  $16,965 	$20,700 	$15,338   
  Mortgage-backed securities			11,734 	8,717 		   5,568   
  Municipal bonds           				2,962		1,968	    	  520 
  Bankers' acceptances				        491 		  0        	  0 
  FHLB, Federal Reserve, 
  and Bankers  
  Bank of Kansas stock	      			1,087 		944         930   
Total	 					                  $33,239 	$32,329 	$22,356   
</TABLE>
  
As of December 31, 1996, the carrying value, maturities and the weighted  
average yields of investment securities were as follows:  

<TABLE>  
<CAPTION>
							                        After 1 
                               Year	           After 5 Years		 
               1 Year or Less		Through 5 Years	Through 10 Years	After 10 Years	Total	 
               Amount	Yield		  Amount	Yield		  Amount	Yield    	Amount	Yield	Amount 	   Yield  
	                               (Dollars in thousands) 
<S>            <C>    <C>      <C>    <C>      <C>    <C>       <C>    <C>    <C>       <C> 
U.S. government 
and agency 
securities	   $5,646 	4.18%		 $11,319 	5.90%		 $0	    0.00%		   $0    	0.00%		 $16,965 	5.32%  
Mortgage-
backed 
securities	      0	   0.00		  3,935    6.37		  2,189 	5.81		    5,610 	5.71	 	  11,734 	5.41 
Municipal 
bonds	          405 	 0.04		  1,927 	  0.04     	630 	0.05		        0	 0.00		   2,962  	0.04 
Bankers' 
acceptances	    491 	 5.19		      0	   0.00	       0	 0.00		        0	 0.00		     491 	 5.19 
FHLB, Federal 
Reserve, and 
Bankers Bank 
of Kansas 
stock	            0	  0.00		      0	   0.00		      0	 0.00   	  1,087 	6.28		   1,087 	 6.28 
  Total	     $6,542 	 3.85%		 $17,181 	5.83%		 $2,819	5.57%		  $6,697 	5.81%		 $33,239 	5.41%  
</TABLE>  
  
With the exception of U.S. government and federal agency obligations, there  
were no investment securities of any single issuer the   
book value of which exceeded 10% of consolidated stockholders' equity at  
December 31, 1996.  
  
  
III.	Loan Portfolio  
Loan Portfolio Composition.  The following table sets forth the composition 
of the loan portfolio by type of loan at the dates   
indicated.
  
<TABLE>
<CAPTION>  
At December 31  
			                         1996				         1995				         1994 
			                         Percent of			    Percent of	   		 Percent of  
	                         		Amount	   Total		Amount	   Total	 Amount	   Total  
                                         (Dollars in thousands) 
<S>                        <C>       <C>     <C>      <C>     <C>       <C> 
Real estate loans: 
Residential one-to-four  
family(1)		                $33,677 	 53.84%	 $34,678  	55.41%	 $29,285 	 56.45%  
Multi-family		               4,271   	6.83	   	5,225 		8.35	 	  5,029   	9.69 
Commercial real  
estate			                   10,041  	16.05   		7,879 	12.59	  	6,429   	8.66 
Total real estate 
loans(2)		                  47,989 	 76.72		  47,782  76.35		 40,743 	 78.53 
Consumer loans	              4,696  		7.51	 	  4,294  	6.86		  3,650   	7.04 
Commercial non- 
real estate loans	           7,410 		11.42		   7,075 	11.31		  3,170   	6.11 
Student loans		              3,709 		 5.93		   4,428 	 7.08		  5,037	   9.71 
Less:	 
Unearned fees,  
discounts and  
premiums		                     151  		0.24	    	 159  	0.25	    	148   	0.29 
Undisbursed loan  
funds			                        14  		0.02	      	12 		0.01		      8   	0.02 
Allowance for  
loan losses		                  820  		1.32		     826  	0.90	    	562   	1.08 
Total loans		              $62,549 	100.00%	 $62,582 	100.00%	$51,882  100.00%  
<FN>
<FN1>  
(1)	Includes loans held for sale totaling $179,190; $699,000; and $0 at  
December 31, 1996, 1995 and 1994, respectively.  
(2)	Includes construction loans totaling $2,706,000; $1,195,000; and  
$598,000 at December 31, 1996, 1995 and 1994,   
respectively.  
</FN>
</TABLE>  
  

The following table sets forth the final contractual maturities of loans at   
December 31, 1996.  The table does not include unscheduled prepayments.  
  
<TABLE>
<CAPTION> 
 
                         At December 31, 1996 
                        (Dollars in thousands)	 
						  
		               Up to		 After 1		   After 3	   After 5		   10 through	Beyond  
                 1 year		to 3 years	 to 5 years	to 10 years	20 years   20 years	Total  
<S>              <C>     <C>         <C>        <C>         <C>        <C>      <C> 
Mortgage  
loans		          $4,748 	$1,619 	    $2,443 	   $5,829 	    $21,242   	$12,108 	$47,989   
Other loans	      4,710 		3,027 		    4,681 		   1,814 		     1,313	         0		 15,545  
Total		          $9,458 	$4,646 	    $7,124 	   $7,643 	    $22,555    $12,108 	$63,534   
Less:						 
Unearned discounts 
and deferred loan 
fees	                                                       			                   (151)
Undisbursed loan 
funds			                                                                           (14)
Allowance for loan losses			                                                      (820)  
Loans, net                                                                      $62,549  
</TABLE> 
 
The following table sets forth at December 31, 1996 the dollar amount  
of all   
loans due after December 31, 1997 and whether such loans had fixed interest  
rates or   
adjustable interest rates:  

<TABLE>  
<CAPTION>
                     					       Fixed	  	   Adjustable	  Total  
					                             (Dollars in thousands)		 
<S>                              <C>         <C>          <C>  			 
Residential 1 - 4 family		        $7,717 	    $22,667 	    $30,384   
Multi-family & non-residential	    1,849 		    11,008 	     12,857   
Other					                         8,910      		1,925     		10,835   
Total		 			                      $18,476     	$35,600 	    $54,076  
</TABLE> 
 
 
Nonperforming Assets. The following table sets forth information with respect  
to   
nonperforming assets, including non-accrual loans and real estate acquired  
through   
foreclosure or by deed in lieu of foreclosure ("real estate owned").  Under the 
original   
terms of the Bank's non-accrual loans at December 31, 1996, interest earned  
on such   
loans during year ended December 31, 1996 would not have been significantly  
different   
than reported.  For each year shown, the Company had no loans greater than  
90 days past   
due which were still accruing interest.  
  
 
<TABLE>
<CAPTION> 
                                   At December 31, 
	  				                      1996   1995   1994   1993   1992  
                                 (Dollars in thousands)	 
<S>                          <C>    <C>      <C>      <C>    <C>	  
Total non-accrual loans	     $140 		$39 		   $209  	  $138     $44   
Real estate owned ("REO")	     27   		5    		  51      	54       0 
Total nonperforming assets	  $167 	 $44 		   $260		   $192     $44   
Nonperforming assets to 
total adjusted loans			     0.27%		 0.07%		  0.50%	 	 0.38%	  0.09%  
Nonperforming assets to 
total assets				            0.16%		 0.04%		  0.33% 		 0.24%	  0.06%  
Allowance for loan losses  
to non-accrual loans and  
REO				                   490.88%	 1,871.30%	269.60%	307.00%	1,247.70%  
</TABLE> 
 
IV.	Summary of Loan Loss Experience  
Allowance for Losses on Loans and Real Estate.  The following table sets 
forth an   
analysis of the allowance for loan losses at the dates indicated.  
 
<TABLE>
<CAPTION>  
                                   At December 31, 
			   		                       1996		1995		1994		 1993	  1992 
                                 (Dollars in thousands)	 
<S>                           <C>    <C>   <C>    <C>    <C>
Balance at beginning of 
year		                        $826 		$562 		$587 		$546 	$369   
Provision for loan losses:		 
Mortgage loans			                4 		  23 		   0    		0 	  23   
Non-mortgage loans			            1   		17    		5 	  	75 		154   
Total provision for loan 
losses	                         15   		40    		5 	  	75  	177   
Allowance for loans of acquired  
bank:		 
Allowance for mortgage loans 
of acquired bank			              0	  	103    		0		    0	    0 
Allowance for non-mortgage 
loans	of acquired bank			        0	  	126      0		    0	    0 
Total of allowance for loans 
of acquired bank			              0	  	229      0		    0    	0 
Recoveries:	  
Mortgage loans			                0		    8 		  12 	    0     0
Non-mortgage loans			            6 		  16 		   4 		   0	    0 
Total recoveries			              6 		  24 		  16 		   0   		0 
Charge-offs:		 
Mortgage loans			                1		   10		   16 		  34 	   0
Non-mortgage loans			           26 		  19 		  30 		   0	    0 
Total charge-offs			            27 		  29 		  46   		34     0 
Balance at end of year			     $820 		$826 		$562 		$587 	$546   
Ratio of allowance for loan  
losses to total	 
outstanding loans (gross)		  1.29%		 1.30%		1.07% 	1.16%	1.06%  
Ratio of net charge-offs  
(recoveries) during	 
the year to average loans  
outstanding(gross) during the  
year					                    0.03%		 0.01%		0.06%		0.06%	0.00%  
 
Ratio of allowance for loan  
losses to total non-
performing loans					      584.91%	2,107.57%	269.00%	307.00%	1,247.70% 
</TABLE> 
 	 
 
The following table sets forth the allocation of the allowance for loan losses  
at the dates   
indicated by category of loans.  This allocation reflects management's 
judgment 
as to   
risks inherent in the types of loans indicated, but the general reserves  
included  
in the table   
are not restricted and are available to absorb all loan losses.  The amount  
allocated in the   
following table to any category should not be interpreted as an indication of  
expected   
actual charge-offs in that category.  
  
<TABLE> 
<CAPTION> 
                                       At December 31,					
		  
			                               1996			          1995	           			1994	  
			                         % of Loans		     % of Loans			      % of Loans  
			                            in Each			       in Each				        in Each  
			                        Category to		    Category to			     Category to  
			                              Total			         Total				          Total  
			                     Amount	  Loans	  Amount	  Loans  	  Amount	  Loans  
			                               (Dollars in thousands)	  
<S>                    <C>       <C>     <C>      <C>       <C>      <C>
Allocated to:								  
Mortgage loans	        $375 		   46%	    $372 		  45%		     $265   		47%  
Non-mortgage loans	     444     	54	      454    	55		       297   		53 
Total	 		              $820    	100%	    $826 	  100%		     $562 	  100%  
</TABLE> 
 
V.	Average Deposits by Classification  
  
The following table sets forth the amounts of deposits by type of  
account at the dates indicated.  
  
<TABLE> 
<CAPTION> 
                                         At December 31, 
				                               1996				                      1995 
 						                   Percent of	Average     			     Percent of	Average 
				               Amount	     Total Rate      Amount	     Total		  Rate 
                                        (Dollars in thousands)	 
<S>                <C>         <C>      <C>       <C>         <C>      <C>
Transaction 
Accounts: 
Checking/NOW		     $18,677 	   21.39%	  2.64%		   $15,372	    19.77%	  2.74% 
Money market 
deposits	           15,984    	18.31		  3.71		     10,102	    12.99		  4.61	 
Savings			           5,526 		   6.33		  2.04		      5,227	     6.72		  2.61 
Total transaction 
accounts	           40,187 	   46.03		  3.04		     30,701      39.48		 3.33	 
Certificates of 
deposit		           47,113    	53.97		  5.60		     47,062 	    60.52		 5.45	 
Total deposits			  $87,300 	  100.00%	  4.42%		   $77,763    	100.00%	 4.61%	 
</TABLE>

<TABLE>
<CAPTION>                             
                                At December 31,	1994 
						                               Percent of
	                                                 Average 
				                    Amount	           Total		    Rate 
                                (Dollars in thousands)	 
<S>                     <C>          <C>          <C>
Transaction Accounts: 
Checking/NOW		          $9,999 	     15.57%	      2.40%  
Money market deposits	  10,897      	16.96		      2.91 
Savings			               3,956      		6.16	      	2.59 
Total transaction 
accounts	               24,852 	     38.69		      2.66 
Certificates of 
deposit		               39,383 	     61.31		      4.45 
Total deposits			      $64,235 	    100.00%	      3.76%  
</TABLE> 
 
As of December 31, 1996, the aggregate amount outstanding of jumbo  
certificates of   
deposit (amounts of $100,000 or more) was $6.8 million.  The following table  
presents   
the maturities of these time certificates of deposit at such date:  
  
<TABLE>
<CAPTION>				  
                            (Dollars in thousands)	  
<S>                                   <C>	  
3 months or less			                   $1,843   
Over 3 months through 6 months	          607   
Over 6 months through 12 months	       3,591   
Over 12 months			                        719   
Total	 				                           $6,760   
  
</TABLE> 
 
<TABLE>
<CAPTION>
VI.	Return on Equity and Assets  
  
                         At or for the years ended December 31,
 	                 			      1996		 1995	 	1994 		1993  	1992  
<S>                         <C>    <C>    <C>    <C>    <C>
Return on average assets	   0.70%		0.78%		0.82%		0.86%	 0.41%  
Return on average equity	   6.54		 7.48	 	7.39		 7.99   7.13 
Equity to total assets		   10.96		10.68		11.72		10.84   5.89 
Dividend payout ratio		    27.43		19.08		18.94		13.02     	0   
Earnings per share before 
extraordinary item(1)(2)	   1.14		 1.24		 1.27		 1.26   0.57 
Earnings per share(1)(2)	   1.14		 1.24 		1.20		 1.26		 0.57
<FN> 
<FN1>
(1)	All per share amounts have been adjusted to give effect to the 5% 
stock dividends paid by the Company in 1996, 1995 and 1994.  
<FN2>
(2)	Net earnings per share for years prior to the 1993 conversion are  
proforma and assume the common shares have been outstanding for 1992.  
</FN>
</TABLE> 

  
ITEM 2.	PROPERTIES  
  
The following table sets forth information concerning the offices of the Bank.  
  
Address		Year Opened		Square Footage	Title  
800 Poyntz Avenue  
Manhattan, KS 66502  	1974		12,000			Owned  
  
1741 N. Washington  
Auburn, KS 66402		1991		8,000			Owned  
  
ITEM 3.	LEGAL PROCEEDINGS  
  
There are no pending legal proceedings to which the Company or the Bank is 
a party,   
other than ordinary routine litigation incidental to the Bank's business.  
  
ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY   
HOLDERS  
  
None.  
  
PART II.  
  
ITEM 5.	MARKET FOR THE COMPANY'S COMMON STOCK 
AND RELATED STOCKHOLDER MATTERS  
  
The Company incorporates by reference the information called for by Item 5 
on this Form   
10-K from the sections captioned "Stock Price Information" of the Company's  
1996   
Annual Report to Stockholders for the fiscal year ended December 31, 1996  
(attached as Exhibit 13.1 hereto).  
  
ITEM 6.	SELECTED FINANCIAL DATA  
  
The Company incorporates by reference the information called for by Item 6 
of this Form   
10-K from the sections entitled "Selected Financial and Other Data" and  
"Management's   
Discussion and Analysis of Financial Condition and Results of Operations" of  
the   
Company's 1996 Annual Report to Stockholders for the fiscal year ended  
December 31, 1996 (attached as Exhibit 13.1 hereto).  
  
 
 
ITEM 7.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF   
FINANCIAL CONDITION AND RESULTS OF OPERATIONS  
  
The Company incorporates by reference the information called for by Item 7  
of this Form  10-K from the section entitled "Management's Discussion and  
Analysis of Financial  Condition and Results of Operations" of the Company's  
1996 Annual Report to  Stockholders for the fiscal year ended December 31,  
1996 (attached as Exhibit 13.1  hereto).  
 
ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA  
  
The Company incorporates by reference the information called for by Item 8  
of this Form  10-K from the Financial Statements set forth in the Company's  
1996 Annual Report to  Stockholders for the fiscal year ended December 31,  
1996 (attached as Exhibit 13.1  hereto).   
 
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH   
ACCOUNTANTS ON ACCOUNTING AND FINANCIAL  DISCLOSURE  
  
None.  
  
  
PART III.  
  
ITEM 10.	DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT  
  
Directors  
  
The Company incorporates by reference the information called for by Item 10  
of this Form  10-K regarding directors of the Company from the section  
entitled "Election of Directors"  of the Company's Proxy Statement for the  
annual meeting of stockholders to be held May  19, 1997 (the "1997 Proxy  
Statement") (attached as Exhibit 99.1 hereto).  
  
Section 16(a) of the Exchange Act requires that the Company's executive  
officers,  directors and persons who own more than 10% of their Company's  
Common Stock file  reports of ownership and changes in ownership with the  
Securities and Exchange  Commission and with the exchange on which the  
Company's shares of Common Stock are  traded.  Such persons are also  
required to furnish the Company with copies of all Section  16(a) forms they  
file.  Based solely on the Company's review of the copies of such forms,  the  
Company is not aware that any of its directors and executive officers or 10%   
stockholders failed to comply with the filing requirements of Section 16(a)  
during the  period commencing January 1, 1996 through December 31, 1996.  
  
Executive Officers  
  
The executive officers of the Company, each of whom is also currently an  
executive  officer of the Bank and both of whom serve at the discretion of the  
Board of Directors, are  identified below:  
  
Name			Age		Positions With the Company  
  
Patrick L. Alexander	44		President and Chief Executive Officer  
  
Susan E. Roepke	57		Vice President, Secretary and Treasurer  
  
The business experience for the past five years of each of the executive  
officers who is not  a director of the Company is as follows:  
  
Susan E. Roepke became Vice President of the Company on August 28, 1992  
and Senior  Vice President, Secretary and Cashier of the Bank on January 5,  
1993.  She was elected  Secretary of the Association in 1992 and became Vice  
President/Operations Division of  the Association in 1991, and had been  
Treasurer of the Association since 1970.  She held  these positions with the  
Association until the Conversion in 1993.  
  
ITEM 11.	EXECUTIVE COMPENSATION  
  
The Company incorporates by reference the information called for by Item 11  
of this Form  10-K from the section entitled "Executive Compensation" of the  
1997 Proxy Statement,  except for information contained under the headings  
"Compensation Committee Report on  Executive Compensation" and  
"Performance Graph".  
  
ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL   
OWNERS AND MANAGEMENT  
  
The Company incorporates by reference the information called for by Item 12  
of this Form  10-K from the section entitled "Security Ownership of Certain  
Beneficial Owners" of the  1997 Proxy Statement.  
  
ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED   
TRANSACTIONS  
  
The Company incorporates by reference the information called for by Item 13  
of this Form  10-K from the section entitled "Transactions with Directors,  
Officers and Associates" of  the 1997 Proxy Statement.  
  
  
PART IV  
  
ITEM 14.	EXHIBITS, FINANCIAL STATEMENT SCHEDULES,  
AND  REPORTS ON FORM 8-K  
  
ITEM 14(a)1 and 2.  Financial Statements and Schedules  
  
MNB BANCSHARES, INC. AND SUBSIDIARY LIST OF FINANCIAL  
STATEMENTS  
  
The following audited Consolidated Financial Statements of the Company and  
its  subsidiary and related notes and auditors' report are incorporated by  
reference from the  Company's 1996 Annual Report to Stockholders for the  
fiscal year ended December 31,  1996 (attached as Exhibit 13.1 hereto).  
  
Report of Independent Public Accountants  
  
Consolidated Balance Sheets - December 31, 1996 and 1995  
  
Consolidated Statements of Earnings - Years Ended  
  December 31, 1996, 1995 and 1994  
  
Consolidated Statements of Stockholders' Equity -  
  Years Ended December 31, 1996, 1995 and 1994  
  
Consolidated Statements of Cash Flows - Years Ended  
  December 31, 1996, 1995 and 1994  
  
Notes to Consolidated Financial Statements  
 
 
All schedules are omitted because they are not required or are not applicable  
or the  required information is shown in the financial statements incorporated  
by reference or  notes thereto.  
  
Item 14(a)3.	Exhibits  
  
The exhibits required by Item 601 of Regulation S-K are included with this  
Form 10-K  and are listed on the "Index to Exhibits" immediately following  
the signature page.  
  
Item 14(b).	Reports on Form 8-K  
  
No reports on Form 8-K were filed during the fourth quarter of 1996.  
  
  
***  
Upon written request to the President of the Company, P.O. Box 308,  
Manhattan, Kansas  66505-0308, copies of the exhibits listed above are  
available to stockholders of the  Company by specifically identifying each  
exhibit desired in the request.  A fee of $.20 per  page of exhibit will be  
charged to stockholders requesting copies to cover copying and  mailing  
costs.  
  
  
SIGNATURES  
  
Pursuant to the requirements of Section 13 or 15(d) of the Securities  
Exchange Act of  1934, the Registrant has duly caused this report to be signed  
on its behalf by the  undersigned, thereunto duly authorized.  
  
MNB BANCSHARES, INC.  
(Registrant)  
  
By: /s/ Patrick L. Alexander  
Patrick L. Alexander  
President and Chief Executive Officer  
  
Pursuant to the requirements of the Securities Exchange Act of 1934, this  
report has been  signed below by the following persons on behalf of the  
Registrant and in the capacities and on the dates indicated.  
  
SIGNATURE		
DATE
TITLE  
  
/s/ Patrick L. Alexander  
March 19, 1997  
President, Chief Executive Officer  
and Director  
  
/s/ Susan E. Roepke  
March 19, 1997  
Chief Financial Officer, Chief  
Accounting Officer, and Director  
  
/s/ Brent A. Bowman  
March 19, 1997  
Chairman of the Board  
 
/s/ Joseph L. Downey  
March 19, 1997  
Director  
 
/s/ Rolla W. Goodyear  
March 19, 1997  
Director 
  
/s/ Charles D. Green  
March 19, 1997  
Director  
  
/s/ Vernon C. Larson  
March 19, 1997  
Director  
 
/s/ Dennis A. Mullin  
March 19, 1997  
Director  
 
/s/ Jerry R. Pettle  
March 19, 1997  
Director  
  
/s/ Donald J. Wissman  
March 19, 1997  
Director  
 
INDEX TO EXHIBITS
Exhibit
Number	   Description	  Page No.  
  
3.1	Articles of Incorporation of the Company_	  
	N/A  
	Incorporated by reference from Exhibit 3.1 of  
	the Form S-1 of the Company, as amended,  
	filed on September 3, 1992 (Registration No.  
	33-51710)  
  
3.2	Bylaws of the Company_Incorporated by	  
	N/A  
	reference from Exhibit 3.2 of the Form S-1  
	of the Company, as amended, filed on   
	September 3, 1992 (Registration No. 33-51710)  
  
4.1	Specimen Common Stock Certificate of the	  
	N/A  
	Company_Incorporated by Reference from   
	Exhibit 4.1 of the Form S-1 of the Company,   
	as amended, filed on September 3, 1994  
	(Registration No. 33-51710)  
  
10.1	MNB Bancshares, Inc. 1992 Stock Option	  
	N/A  
	Plan_Incorporated by reference from   
	Exhibit A to the Company's Proxy Statement  
	for the Annual Meeting of Stockholders held  
	May 17, 1994  
  
10.2	Stock Option Agreement between the Company	  
	N/A  
	and Patrick L. Alexander_Incorporated by  
	reference from Exhibit 10.2 to Form 10-K dated  
	March 26, 1994  
  
10.3	Stock Option Agreement between the Company	  
	N/A  
	and Vernon C. Larson_Incorporated by  
	reference from Exhibit 10.3 to Form 10-K dated  
	March 26, 1994  
  
10.4	Stock Option Agreement between the Company	  
	N/A  
	and Brent A. Bowman_Incorporated by  
	reference from Exhibit 10.4 to Form 10-K dated  
	March 26, 1994  
  
10.5	Stock Option Agreement between the Company	  
	N/A  
	and Charles D. Green_Incorporated by  
	reference from Exhibit 10.6 to Form 10-K dated  
	March 26, 1994  
  
10.6	Stock Option Agreement between the Company	  
	N/A  
	and Dennis A. Mullin_Incorporated by  
	reference from Exhibit 10.4 to Form 10-K dated  
	March 26, 1994  
  
10.7	Stock Option Agreement between the Company	  
	N/A  
	and Jerry R. Pettle_Incorporated by  
	reference from Exhibit 10.9 to Form 10-K dated  
	March 26, 1994  
  
10.8	Stock Option Agreement between the Company	  
	N/A  
	and Susan E. Roepke_Incorporated by  
	reference from Exhibit 10.11 to Form 10-K dated  
	March 26, 1994  
  
10.9	Stock Option Agreement between the Company	  
	N/A  
	and Michael R. Toy_Incorporated by  
	reference from Exhibit 10.13 to Form 10-K dated  
	March 26, 1994  
  
10.10	Stock Option Agreement between the Company	  
	N/A  
	and Dennis D. Wohler_Incorporated by  
	reference from Exhibit 10.14 to Form 10-K dated  
	March 26, 1994  
  
10.11	Employment Agreement among the Company,	  
	N/A  
	Security National Bank and Patrick L.  
	Alexander_Incorporated by reference from  
	Exhibit 10.15 to Form 10-K dated March 26,  
	1994  
  
10.12	Security National Bank Deferred Compensation	  
	N/A  
	Plan, dated December 21, 1994_Incorporated   
	by reference from Exhibit 10.20 dated March 26,  
	1994  
  
10.13	Agreement and Plan of Merger between the	  
	N/A  
	Company and Auburn Security Bancshares, Inc.,  
	dated November 10, 1994_Incorporated by   
	reference from Exhibit 2.1 to Form 8-K dated  
	November 10, 1994  
  
10.14	Employment Agreement among the Company and  
	N/A  
	Rolla W. Goodyear _ Incorporated by reference  
	from Exhibit 10.1 to Form 10-Q dated August 11,   
1995  
  
10.15	Stock Option Agreement between the Company	  
	and Michael E. Scheopner_Dated May 13, 1996  
  
13.1	1996 Annual Report to Stockholders of the Company  
	for the fiscal year ended December 31, 1996  
  
21.1	Subsidiaries of the Company   
  
23.1	Consent of KPMG Peat Marwick LLP  
  
27.1	Financial Data Schedule  
  
99.1	Proxy Statement of the Company for the Annual  
	Meeting of Stockholders to be held May 19, 1997  
  
EXHIBIT 10.15
STOCK OPTION AGREEMENT
BETWEEN THE COMPANY AND
MICHAEL E. SCHEOPNER DATED
MAY 13, 1996

MNB BANCSHARES, INC.
1992 STOCK OPTION PLAN


1.	A STOCK OPTION  to acquire 4,000 shares (hereinafter referred to 
as "Shares")
of Common Stock of MNB BANCSHARES, INC. (hereinafter referred to as 
the 
"Company") is hereby granted to Michael E. Scheopner (hereinafter referred 
to 
as the 
"Optionee"), subject in all respects to the terms and conditions of the MNB 
BANCSHARES, INC. 1992 STOCK OPTION PLAN (hereinafter referred to 
as the 
"Plan") and such other terms and conditions as are set forth herein.

2.	This Option is not intended to constitute an Incentive Stock Option 
under 
Section 
422(b) of the Internal Revenue Code of 1986.

3.	The option price as determined by the Board of Directors of the 
Company (the 
"Board") is Twenty-One Dollars ($21.00) per Share, the average of bid and 
ask 
prices as 
of May 8, 1996,

4.	This Option may be exercised in accordance with the following table:



Date			Number of Shares 
Exercisable
May 13, 1997		800
May 13, 1998		800
May 13, 1999		1,200
May 13, 2000		1,200

In the event of a Change of Control, this Option shall become immediately and 
fully 
exercisable.  A "Change of Control" shall be deemed to have occurred if:

(i) as a result of, or in connection with, any tender offer or exchange offer, 
merger or other business combination, sale of assets or contested 
election, or any combination of the foregoing transactions (the 
"Transaction"), the persons who were directors of the Company shall 
cease to constitute a majority of the Board or any successor to the 
Company, unless the election, or nomination for election by the 
stockholders, of any new director was approved by a majority of the 
Board, then such new director shall, for purposes of the Plan, be 
considered as a member of the Board;
 
(ii) the Company is merged or consolidated with another corporation and 
as a result of the merger or consolidation less than sixty-seven percent 
(67%) of the outstanding voting securities of the surviving or resulting 
corporation shall then be owned in the aggregate by the former 
stockholders of the Company, other than (a) affiliates within the 
meaning of the Securities and Exchange Act of 1934 or (b) any party to 
the merger or consolidation;
 
(iii) a tender offer or exchange offer is made and consummated for the 
ownership of securities of the Company representing thirty-three 
percent (33%) or more of the combined voting power of the 
Company's then outstanding voting securities; or
 
(iv) the Company transfers substantially all of its assets to another 
corporation which is not a wholly-owned subsidiary of the Company.

Notwithstanding the foregoing, a Change of Control shall not be deemed to 
occur solely 
because thirty-three percent (33%) or more of the combined voting power of 
the 
company's then outstanding voting securities are acquired by (a) a trustee or 
other 
fiduciary holding securities under one or more employee benefit plans 
maintaining for 
employees benefit plans maintained for employees of the Company or (b) any 
corporation 
which, immediately prior to such acquisition, is owned directly or indirectly 
by the 
stockholders of the Company in the same proportion as their ownership of 
stock 
immediately prior to such acquisition.

5.	This Option may not be exercised if the issuance of Shares upon such 
exercise 
would constitute a violation of any applicable federal or state securities 
law, or any other 
valid law or regulation.  As a condition to the exercise of this Option, the 
Optionee shall 
represent to the Company that the shares being acquired under this Option 
are for 
investment and not with a present view for distribution or resale, unless 
counsel for the 
Company is then of the opinion that such a representation is not required 
under any 
applicable law, regulation or rule of any governmental agency.

6.	This Option may not be transferred in any manner and may be 
exercised 
during the 
lifetime of the Optionee only by him.  The terms of this Option shall be 
binding upon the 
Optionee's executors, administrators, heirs, assigns and successors.

7.	This Option may not be exercised more than 10 years after the 
effective 
date 
indicated below and may be exercised during such term only in accordance 
with the terms 
and conditions set forth in the plan.

Effective Date:  May 8, 1996


MNB BANCSHARES, INC.



BY:/s/ Brent A. Bowman
Chairman of the Board

ATTEST:

	The Optionee acknowledges that he has received a copy of the plan 
and is familiar 
with the terms and conditions set forth therein.  The Optionee agrees to 
accept as binding, 
conclusive, and final all decisions and interpretations of the Committee.  
As a condition to 
the exercise of this Option, the Optionee authorizes the Company to withhold 
from any 
regular cash compensation payable by the Company any taxes required to be 
withheld 
under any federal, state, or local law as a result of exercising this Option.


Dated:					


BY:/s/ Michael E. Scheopner
Michael E. Scheopner


 
EXHIBIT 21.1  
  
SUBSIDIARIES OF MNB BANCSHARES, INC.  
  
  
	  
	The only subsidiary of the Company is Security National Bank, a  
national   
banking association with its main office located in Manhattan, Kansas, and  
with a branch office in Auburn, Kansas.  
 
 
EXHIBIT 13.1 
1996 ANNUAL REPORT TO STOCKHOLDERS OF THE 
COMPANY FOR THE FISCAL YEAR ENDED 
DECEMBER 31, 1996
 
Corporate Profile 
 
MNB Bancshares, Inc. (the "Company") was formed on August 27, 1992  
to become the holding company for Manhattan Federal Savings and Loan  
Association (the "Association") in the conversion of the Association from a  
federal mutual savings association to a national bank. The Association  
completed its conversion to a national bank on January 5, 1993, and  
operated as Manhattan National Bank. As part of that conversion, the  
Company became the sole stockholder of Manhattan National Bank. 
 
On April 1, 1995, the Company acquired all of the issued and outstanding  
stock of Auburn Security Bancshares, Inc., a one-bank holding company  
which owned 99% of the outstanding stock of Security State Bank,  
Auburn, Kansas. Subsequent to the acquisition, the Company acquired all  
of the remaining stock of Security State Bank. Consolidated assets  
acquired in this transaction were approximately $20 million. This  
acquisition, which was accounted for using the  
purchase method of accounting, is reflected in the December 31, 1996 and  
1995 consolidated balance sheets and statements of earnings since the  
acquisition date. 
 
On December 31, 1995, the Company merged and consolidated Manhattan  
National Bank and Security State Bank, and the resulting institution was  
named Security National Bank (the "Bank"). The home office for the Bank  
is Manhattan, Kansas, with a branch office operating in Auburn, Kansas.  
The Bank is dedicated to providing quality services to its local communities  
and continues to originate residential mortgage loans, consumer loans,  
home equity loans, student loans, commercial real estate and non real  
estate loans, and small business loans. 
 
The common stock of the Company is listed on the Nasdaq Stock Market  
Small-Cap Market System under the symbol "MNBB". The newspaper  
abbreviation is "MNB Bn". 
 
Contents 
 
Letter To Stockholders	2 
 
Selected Financial and Other Data	4 
 
Management's Discussion and Analysis	5 
 
Independent Auditors' Report	17 
 
Consolidated Financial Statements	18 
 
Notes to Consolidated Financial Statements	22 
 
Corporate Information	32 
 
February, 1996 
To our Stockholders, Customers, And Friends 
 
 
1996 was an outstanding year for MNB Bancshares, Inc. and its  
shareholders.  Net earnings before the one-time FDIC Savings Association  
Insurance Fund (the OSAIFO) special assessment exceeded $1 million.  We  
continued our practice of declaring a five percent stock dividend. Our cash  
dividend doubled from an annual rate of 25 cents per share to an  
annualized rate of 50 cents per share.  Total assets at year end were $103.4  
million.  All of these facts reflect the continuing and accelerating success  
that your company enjoys.  Competing as a community bank, we are  
dedicated to meeting the needs of our customers, the communities we  
serve, and our shareholders.  I will briefly address  
key issues that impacted your company in 1996 and which will influence us  
in 1997 and beyond. 
 
A Congressional mandate in the third quarter of 1996 (the Omnibus  
Appropriations bill) to recapitalize the SAIF resulted in a one-time  
$449,000 charge against earnings.  We are gratified that the significant  
disparity in FDIC insurance premiums between SAIF and Bank Insurance  
Fund (BIF) deposits is finally resolved.  Going forward, the resolution of  
this issue will have the effect of reducing the total deposit insurance  
expense of MNB Bancshares, Inc. by approximately $100,000 annually.   
The significantly higher deposit insurance premium we had to pay in the  
past, as compared to institutions with primarily BIF-insured deposits,  
placed us at a competitive disadvantage regarding our ability to attract  
deposits and produce earnings at a level comparable to those of our peers.   
The resolution of this issue closes the final lingering chapter that your  
company has dealt with regarding its transition in 1993 from a thrift  
institution to a commercial banking organization. 
 
Net earnings for the year, before the one-time FDIC special assessment,  
were $1,006,032 or $1.59 per share, compared to $1.24 per share in 1995.   
These record operating results were achieved through an increase of net  
interest income of approximately $390,000 and an increase in noninterest  
income of approximately $157,000.  This was accomplished without  
comparable increases in noninterest expenses, which increased by only  
$166,000, absent the SAIF assessment.  These achievements resulted from  
the added efficiencies we were able to realize throughout 1996, improved  
product pricing, and the continuing transition of our balance sheet to more  
closely resemble that of a commercial bank.  After the FDIC special  
assessment, net earnings were $716,530 in 1996, compared to $753,406 in  
1995. 
 
Considerable time and effort was put into the creation of Security National  
Bank as we combined our two subsidiaries, Manhattan National Bank and  
Security State Bank.  These efforts resulted in a larger, more efficient  
commercial bank with combined resources, abilities, and efficiencies that  
exceed those of the two subsidiary banks taken separately.  By combining  
the two banks, we are utilizing the resources of one organization to meet  
the demands and requirements of multiple communities.  Our enhanced  
strengths and capabilities mean that we can more easily fulfill our  
customers diverse loan requirements, whether commercial, consumer, or  
residential.  Additionally, we can offer all of our customers direct access to  
modern automated banking services day or night through  
telephone/personal computer banking, debit cards, and revolving lines of  
credit.  The combination of the two banks also allowed us to add insurance  
services to our product mix.  We acquired the Goodyear Insurance Agency  
of Auburn, Kansas in January of 1997 and can now offer a full line of  
insurance products to our entire customer base.  We expect this to evolve  
into a very profitable and complementary product line as we implement an  
aggressive marketing program for insurance services. In keeping with our  
strategic plan, we continue to seek out community banks for acquisition to  
expand our asset base, enhance our geographic diversification, and  
ultimately provide increased returns to our shareholders.  This search has  
not been an easy process, as possible sellers expectations remain  high.   
Although we think it is imperative to continue to expand, we will not do so  
to the detriment of our existing shareholder base.  We continue to look for  
strategic acquisitions that will enhance our market presence and create  
value for our shareholders. 
 
Acquisition is not the only vehicle for entry into other markets.  In  
February 1997, we negotiated an agreement with a regional banking  
organization to assume their land lease on a fully equipped branch bank  
facility at 21st and Wanamaker in Topeka, Kansas.  This lease assumption  
allows us to formally enter the Topeka market with minimal capital outlay  
and  controlled occupancy expense.   
The entry into Topeka is a natural expansion of our banking center  
activities in nearby Auburn, Kansas.  Not only will it complement our  
efforts in Auburn and strengthen existing customer relationships, it will  
allow us to effectively penetrate the metropolitan Topeka market by  
locating in a vibrant business corridor.  This branch location is ideally  
situated to take advantage of the expanding economy in southwest Topeka.   
While we anticipate this facility will have a negative impact on earnings in  
1997, it should provide a solid base for earnings and asset growth in 1998  
and beyond. 
 
As I stated at the beginning of this letter, 1996 was an outstanding year for  
your company, but not just from an earnings perspective.  1996 saw the  
unification of our two subsidiary banks into a single entity dedicated to  
meeting the multiple and diverse needs of the communities we serve.  As  
community bankers, we know the importance and value of fostering and  
maintaining relationships with our customers.  The incursion of large  
regional and national banking institutions into our communities creates new  
competitive challenges. We must differentiate ourselves as a community  
bank dedicated to meeting the needs of our customers in a personal, timely  
manner.  This competition requires us to be quick, flexible, innovative, and  
responsive.  It is a challenge we accept with enthusiasm and confidence in  
our abilities. 
 
Please take a moment to review this annual report.  It details the progress  
we have made as a company dedicated to meeting the needs of our  
customers and our shareholders.  The financial services industry is  
changing rapidly.  We are confident that your organization is properly  
prepared to meet these changes and prosper as we go forward.  I thank my  
associates for their continued hard work and dedication to the successful  
implementation of our goals.  I especially thank our customers for placing  
their trust in us to meet their banking and financial services needs.  And  
finally, I thank our shareholders for their continued enthusiastic support  
and confidence in the future of MNB Bancshares, Inc.  I am excited about  
our prospects and opportunities in 1997 and beyond. 
 
Sincerely, 
 
/s/Patrick L. Alexander 
President and Chief Executive Officer 

<TABLE>
<CAPTION> 
Selected Financial And Other Data Of  
MNB Bancshares, Inc. 
  
                           At or for the years ended December 31, 
		                            1996		1995		1994		1993		1992(1) 
						                     (Dollars in thousands, except per share 
                                 amounts and percentages) 
Selected Financial Data: 
<S>                       <C>        <C>        <C>      <C>      <C>
Total assets					         $103,420	  $101,185	  $77,797	 $80,265	 $77,205 
Loans, net (2)					         62,549	   	62,582  		51,882	 	50,141 		50,744 
Mortgage backed securities		11,734		    8,717		   5,569		  5,098		  2,582 
Deposits					               86,710		   86,399		  61,440		 61,351		 64,479 
Borrowings					              3,615		    2,881		   6,694		  9,130		  7,000 
Stockholders' equity 				   11,334		   10,810		   9,114		  8,702		  4,546 
Book value per share (3)			  18.73		    17.86		   16.93		  16.24		    000 
 
Selected Operating Data: 
Total interest income				 $7,670		   $7,051		   $5,411	  $5,513		 $6,136 
Total interest expense				 4,049		    3,820		    2,788		  3,060	  	3,972 
Net interest income				    3,621		    3,231		    2,623		  2,453		  2,164 
Provision for loan losses			  15		       40		        5		     75		    177 
Net interest income after 
provision for loan losses		3,606		    3,191		    2,618		  2,378		  1,987 
Gains on sales of loans			    75		       95		       79		    389		    392 
Other noninterest income			  608		      432		      264		    198		    108 
Total noninterest income			  683		      527		      343		    587    		500 
Total noninterest expense		3,233		    2,618		    1,869		  1,884		  1,547 
Income tax expense				       339      		347      		398	    	413    		635 
Net earnings before 
extraordinary item	          717		      753		      694		    668    		305 
Extraordinary item				       000		      000		       39		    000		    000 
Net earnings					           $717		     $753		     $655	   	$668	   	$305 
Net earnings per share 
before extraordinary 
item(3)(4)(7)		             1.14		     1.24		     1.27    	1.26	    	.57 
Net earnings per 
share(3)(4)(7)		            1.14 		    1.24		     1.20    	1.26    		.57  
Dividends per share (3)			  0.32		     0.24		     0.23		   0.16		    000 
 
Other Data: 
Return on average assets			 0.70%		    0.78%		    0.82%		  0.86%  	0.41% 
Return on average equity			 6.54		     7.48		     7.39		   7.99		  7.13 
Equity to total assets				 10.96		    10.68		    11.72		  10.84		  5.89 
Net interest rate 
spread (5)			               3.28		     3.02		     2.96		   2.86		  2.63 
Net yield on average 
interest-earning 
assets (6)			               3.67		     3.55		     3.38    	3.23		  2.94 
Average interest-earning 
assets to 
average interest-bearing 
liabilities		             109.56		   112.58		   111.67		 109.30		105.55 
Other expenses to average 
assets		                    3.15		     2.71		     2.34	    2.42		  2.09 
Nonperforming loans to 
total loans		               0.22     		0.06     		0.40	    0.28  		0.09 
Net charge-offs to average 
loans		                     0.03		     0.01		     0.06	    0.07		  0.00 
Nonperforming assets to 
total assets		              0.16		     0.04     		0.33	    0.24		  0.06 
Dividend payout ratio				  27.43		    19.08		    18.94		  13.02		   000 
Number of full service 
banking offices	               2		        2		        1		      1		     1 
<FN> 
<FN1>
(1)	Information for periods prior to 1993 relates to Manhattan Federal  
Savings and Loan Association. 
<FN2>
(2)	Loans are presented after adjustments for undisbursed loan funds,  
unearned fees and discounts, and the allowance for losses. 
<FN3>
(3)	All per share amounts have been adjusted to give effect to the 5%  
stock dividends paid by the Company in 1996, 1995, and 1994. 
<FN4>
(4)	Net earnings per share for years prior to the 1993 conversion are  
pro forma and assume the common shares have been outstanding for 1992. 
<FN5>
(5)	Represents the difference between the average yield on interest- 
earning assets and the average cost of interest-bearing liabilities. 
<FN6>
(6)	Represents net interest income as a percentage of average interest- 
earning assets. 
<FN7>
(7)	Net earnings per share, before the 1996 FDIC Special Assessment  
(net of tax) was $1.59 per share 
</FN> 
</TABLE> 
 
Management's Discussion And Analysis Of Financial Condition And  
Results Of Operations 
 
Overview 

MNB Bancshares, Inc. (the "Company") is a one-bank holding company  
incorporated under the laws of the State of Delaware and is engaged in the  
banking business through its wholly-owned subsidiary, Security National  
Bank (the "Bank").  On December 31, 1995, the Company merged and  
consolidated Manhattan National Bank and Security State Bank to form  
Security National Bank. 
 
While core earnings increased, due to the one-time special SAIF  
assessment of $449,000, earnings remained flat in comparison to 1995.   
The Company realized net earnings in 1996 of $716,530 compared to  
$753,406 in 1995. The return on average assets amounted to .70%  
compared to .78% in 1995. Return on average equity was 6.54% and net  
earnings per share was $1.14. Based on this financial performance, the  
Board of Directors declared dividends totaling 32 cents per share in 1996,  
and a 5% stock dividend in August of 1996. 
 
The tradition of quality assets continues and management's ongoing  
strategy to diversify the deposit and loan portfolios in order to increase  
profitability in the future has been successful. Focusing on customers' needs  
and the development of full service banking relationships has been  
instrumental to the Company's success. Management believes that the  
strong capital position of the Company puts it on solid ground and  
provides an excellent base for further growth and expansion. 
 
The Bank is principally engaged in the  
business of attracting deposits from the general public and using such 
deposits, together with borrowings and other  
funds, to originate one-to-four family residential mortgage loans, multi- 
family residential mortgage loans and consumer and commercial loans. 
 
Deposits of the Bank are insured by both the SAIF and the Bank Insurance  
Fund (the "BIF") of the Federal Deposit Insurance Corporation (the  
"FDIC") up to the maximum amount allowed by applicable federal law and  
regulation. The Bank's primary regulator is the Office of the Comptroller of  
the Currency (the "OCC"). Additionally, the Bank is subject to regulation  
by the FDIC, as administrator of the SAIF and the BIF and by the Board of  
Governors of the Federal Reserve System (the "Federal Reserve Board")  
with respect to reserves required to be maintained against deposits and  
certain other matters. The Bank is a member of the Federal Home Loan  
Bank of Topeka (the "FHLB") and the Federal Reserve Bank of Kansas  
City. 
 
As a bank holding company, the Company is subject to regulation and  
supervision by the Federal Reserve Board. The Company is also subject to  
various reporting and other requirements under the federal securities laws  
and the regulations of the Securities and Exchange Commission (the  
"SEC"). 
 
Currently, the Company's business consists solely of the ownership of the  
Bank, with its main office in Manhattan, Kansas and a branch office in  
Auburn, Kansas a community ten miles southwest of Topeka, Kansas. The  
acquisition of Auburn Security Bancshares, Inc. and its wholly-owned  
subsidiary, Security State Bank located in Auburn, Kansas ("Auburn") was  
completed on April 1, 1995. The acquisition, which was accounted for  
using the purchase method of accounting, is reflected in the December 31,  
1995 and 1996 consolidated balance sheet and consolidated statements of  
earnings since the acquisition date. In February, 1997, the Bank agreed to  
lease a facility at 6100 SW 21st Street in Topeka, Kansas.  The Bank  
expects to commence operations of this branch facility in May, 1997.  The  
Company's plan is to continue to enter complementary markets in an effort  
to enhance its asset base, long term earnings and resources. 
Comparison Of Operating Results For The Years Ended December 31,  
1996 And 1995 
 
General. Net earnings for 1996 decreased 4.9% to $716,530 from  
$753,406 in 1995. Contributing to this decrease was an expense of  
$449,000 for the Company's one-time special assessment to fund the  
FDIC's recapitalization of the SAIF as mandated by the Omnibus  
Appropriations bill which was signed into law on September 30, 1996.   
With the recapitalization of the fund, expense for insurance of accounts will  
be reduced by approximately $100,000 per year for the current deposit  
account base assuming there are no increases in the insurance assessment  
rates.  Absent this expense, earnings, net of tax would have been  
$1,006,032, an increase of $252,626, or 33.5%, over 1995.  Net interest  
income after provision for loan losses increased $414,640 or 13.0% to  
$3,605,759.  Gains on sale of loans decreased 20.9%, or $19,975, to  
$75,450, while fees and service charges increased $125,810, or 32.2%, to  
$517,124.  Non-interest expense increased $615,366, or 23.5%, to  
$3,233,192.  A major factor in the increase of both net interest income and  
fees and service charges was that operating results of Auburn are not  
reflected in the Company's results for the first quarter of 1995.  The  
acquisition of Auburn also contributed to the increase in non interest  
expense, along with one-time expenses of approximately $60,000  
associated with the consolidation of the subsidiary as well as the FDIC  
special assessment.  
 
Interest Income. Interest income increased $619,146, or 8.8% to $7.7  
million. Average interest-earning assets increased from $91.1 million in  
1995 to $98.7 million in 1996. The average yield on interest-earning assets  
increased slightly from 7.7% to 7.8% in 1996. Interest income on loans  
increased $.4 million, or 7.9%, to $5.7 million.  The increase in interest  
income on loans was higher due to both an increase in average loans  
outstanding and loans which repriced  at higher rates. Interest earned on  
securities increased as securities matured and the proceeds were reinvested  
in higher yielding securities. Loans on one-to-four family residences held in  
the portfolio decreased 1.4% to $33.5 million from $34.0 million while  
commercial real estate increased 9.2% to $14.3 million. Additionally,  
consumer, student and non-mortgage commercial loans outstanding at  
December 31, 1996 decreased 1.6% to $15.5 million from $15.8 million.  
Interest income on investment and mortgage-backed securities increased  
11.5% to $2.0 million from $1.8 million  
in 1995. 
 
Interest Expense. Interest expense increased $229,256, or 6.0%, compared  
to 1995. This increase was due in large part to a full year of expense at the  
Auburn facility and increased balances of interest-bearing liabilities.  
Deposit interest expense increased from $3.6 million in 1995 to $3.9  
million in 1996, or 7.6%, due to an increase in average interest-bearing  
deposits of $9.5 million.  Interest on borrowings, consisting of advances  
from the FHLB, declined 18.1% to $189,312, as these average balances  
outstanding declined $376,000. 
 
Net Interest Income. Net interest income represents the difference between  
income derived from interest-earning assets and the expense on interest- 
bearing liabilities. Net interest income is affected by both (i) the difference
between the rates of interest earned on interest-earning assets and the rates  
paid on interest-bearing liabilities ("interest rate spread") and (ii) the  
relative amounts of interest-earning assets and interest-bearing liabilities. 
 
Net interest income increased 12.1% to $3.6 million in 1996 compared to  
$3.2 million in 1995. This was the result of the yield on interest-earning  
assets remaining steady at approximately 7.7% while the cost of interest- 
bearing liabilities decreased from 4.7% to 4.5%. The Company has a ratio  
of interest-earning assets to interest-bearing liabilities of 109.6% which  
resulted in the net interest margin increasing from 3.6%  in 1995 to 3.7% in  
1996. 
 
Provision For Loan Losses. The provision for loan losses decreased from  
$39,750 in 1995 to $15,000 in 1996. At December 31, 1996, the allowance  
for loan losses was $819,660, which was 1.3% of gross loans outstanding.  
At December 31, 1995, this ratio was also 1.3%. No provision for loan  
losses was made during the first nine months of 1996.  After the quarterly  
review of the portfolio and completing an economic analysis, a provision of  
$5,000 per month was resumed during the fourth quarter of 1996.  This  
was due to the Bank's plans to expand its commercial lending activities.   
At the same time, new guidelines for credit risk evaluation and  
documentation were created and implemented in response to the Bank's  
plans to increase its commercial loan portfolio.  These factors will continue  
to be assessed and further changes in the provision will be made if  
circumstances warrant such changes. Net charge-offs in 1996 were  
$21,704, compared to $4,835 in 1995. 
 
Noninterest Income. Noninterest income increased 29.7% to $683,297 in  
1996 from $526,660 in 1995. The increase resulted from an increase of  
32.2% in fees and service charges for deposit accounts and fees on loans to  
$517,124 from $391,314 in 1995 as a result of the acquisition of Auburn  
and a restructuring of fees and service charges on deposit accounts. The  
increase of 127.3% to $90,723 for other income includes the receipt of  
$69,808 in interest on an income tax refund related to the  tax years of  
1978 and 1979.  This increase was partially offset by a decrease in the gains  
on sale of loans of $19,975 from $95,425 to $75,450, or 20.9%, and a loss  
of sale of investment securities available for sale of $15,213 as the  
Company sought to reposition its portfolio and lengthen its maturities.   
Some lower-yield, short-term available-for-sale securities were sold and the  
proceeds reinvested in intermediate securities.  The analysis done on these  
transactions indicated that they would be income-neutral for 1996. 
 
Noninterest Expense. Noninterest expense increased $615,366, or 23.5%,  
to $3.2 million. Of this amount, $449,000 was attributable to the SAIF  
assessment.  The inclusion of Auburn's operating results for the full year  
and several one-time expenses totaling approximately $60,000 due to  
consolidation of the subsidiary also contributed to this increase.  The  
amortization of goodwill and core deposit intangibles related to the  
acquisition of Auburn increased $30,052, or 36.6%.  Stationery, printing  
and office supplies increased $25,886, or 43.5%, as a result of the change  
of name and the consolidation of the bank subsidiaries.  Occupancy and  
equipment expense increased 20.7% to $376,823, as the Auburn  
acquisition was reflected for the entire year and several one-time expenses  
were incurred during the conversion of the Auburn branch to the same data  
processing system as the main Manhattan facility.  Other expenses  
increased $27,806, or 4.8%, also reflecting the acquisition.  Partially  
offsetting these increases were decreases in advertising from $75,078 in  
1995 to $61,151 in 1996 or by 18.6%.  Absent the special assessment of  
$449,000,  FDIC premiums decreased $39,395 as a refund of the premium  
for the fourth quarter was received as a result of the recapitalization of the  
SAIF fund 

Average Assets/Liabilities. The following table sets forth information  
relating to average balances of interest-earning assets and interest-bearing  
liabilities for the years ended December 31, 1996, 1995 and 1994. This  
table reflects the average yields on assets and average costs of liabilities  
for  
the periods indicated (derived by dividing income or expense by the  
monthly average balance of assets or liabilities, respectively) as well as the  
"net interest margin" (which reflects the effect of the net earnings balance)  
for the periods shown. 
 
 
<TABLE> 
<CAPTION>
Average Balance Sheets-Average Yields And Rates   
 
	            			Year Ended December 31, 1996 		Year Ended December 31, 1995 
				            Average			           Average	        Average			       Average  
				              Balance	Interest	Yield/Rate	     Balance	Interest	Yield/Rate 
<S>                     <C>     <C>      <C>             <C>     <C>      <C>
Assets: 
Interest-earning 
assets:  
Investment 
securities(1)         	 $26,149	 $1,385		  5.30%	         $24,914	$1,331	  5.34%	
Mortgage-backed 
and 
mortgage-
derivative 
securities  			           8,609		   581		  6.75		           6,541	   432		 6.60  
Loans receivable, 
net(2)	                  63,894		 5,704		  8.93		          59,603		5,288		 8.87 
Total interest-
earning assets       	   98,652		 7,670		  7.77		          91,058 	7,051		 7.74 
Noninterest-
earning assets         	  4,065			                          5,415	
Total			       	       $102,717				                       $96,473 
Liabilities and 
Stockholders' Equity:	 
Interest-bearing 
liabilities:	 
Certificates of 
deposit		              $47,113	  $2,638		  5.60% 		       $47,062	$2,566 		5.45% 
Money market deposits	  15,984		    594		  3.71		          10,102   	466 		4.61 
Other deposits		        24,203		    628		  2.59		          20,599   	557		 2.70 
FHLB advances and 
other borrowings(3)	     2,746		    189		  6.88		           3,122		  231 	7.40 
Total interest-bearing 
  liabilities			        90,046	   4,049		  4.49	        	  80,885	 3,820	4.72   
Noninterest-bearing 
liabilities	             1,715						                       5,519	
Stockholders' equity		  10,956	                       				10,069	 
 Total			              $102,717					                     $96,473 
Net interest income		             $3,621					                      $3,231	 
Interest rate 
spread (4)	                                3.28%					                     3.02% 	 
Net interest margin (5)	                   3.67%		                    				3.55%		 
Ratio of average 
interest-earning 
assets to average 
interest-bearing 
liabilities	                     109.56%					                       112.58%	 
</TABLE>

<TABLE>
<CAPTION>
				                    Year Ended December 31, 1994 		 
				                         Average			          Average 
				                         Balance	Interest	Yield/Rate	 
<S>                          <C>     <C>         <C>
Assets: 
Interest-earning assets:  
Investment securities (1)	   $20,884	$948		       4.54% 
Mortgage-backed and 
mortgage-derivative 
securities			                  5,295		282		       5.33 
Loans receivable, net (2)	    51,375		4,181		     8.14 
Total interest-earning assets	77,554		5,411		     6.98 
Noninterest-earning assets	    2,224 		 
Total				                     $79,778 
Liabilities and Stockholders' 
Equity:	 
Interest-bearing 
liabilities:	 
Certificates of deposit		     $39,382	$1,753		    4.45% 
 Money market deposits	        10,897		  318		    2.92  
 Other deposits		              13,955		  343		    2.46 
 FHLB advances and 
 other borrowings (3)	          5,215		  374		    7.17 
Total interest-bearing 
  liabilities			               69,449		2,788		    4.01 
Noninterest-bearing 
liabilities	                    1,470		 
Stockholders' equity		          8,859		 
 Total			                     $79,778		 
Net interest income		                  $2,623	 
Interest rate spread (4)	                         2.96% 
Net interest margin (5)	                          3.38% 
Ratio of average interest- 
earning assets to average 
interest-bearing liabilities	          111.67% 
<FN> 
<FN1> 
(1)	Income on investment securities includes all securities, interest  
bearing deposits in other financial institutions and stock owned in  
	the FHLB and the Federal Reserve. 
<FN2>
(2)	Includes non-accrual loans. 
<FN3>
(3)	During the third quarter of 1994, the Company prepaid $1.5 million  
of its FHLB advances and incurred prepayment penalties	of $61,000. 
<FN4>
(4)	Interest rate spread represents the difference between the average  
rate on interest-earning assets and the average cost of  
	interest-bearing liabilities. 
<FN5>
(5)	Net interest margin represents net interest income divided by  
average interest-earning assets. 
Comparison Of Operating Results For The Years Ended December 31,  
1995 And 1994 
</FN>
</TABLE>

General. Net earnings for 1995 increased 15.0% to $753,406 from  
$654,951 in 1994. Included in this increase were net earnings from Auburn  
of $98,253. Although 1995 results reflected a continued improvement in  
net interest income of $607,549, or 23.2%, the increase in noninterest  
expense of $748,148, or 40.0%, and increased provision for loan losses of  
$34,750 offset this increase. Noninterest income increased $183,781, or  
53.6%, which included an increase in gains on sale of loans of 20.6% to  
$95,425 compared to $79,136 in 1994 and an increase of 54.6% in fee and  
service charge income to $391,314 for 1995. 
 
Interest Income. Interest income increased $1,639,455, or 30.3% to $7.1  
million. Average interest-earning assets increased from $77.6 million in  
1994 to $91.1 million in 1995. The average yield on interest-earning assets  
increased from 7.0% to 7.7% in 1995. Interest income on loans increased  
$1.1 million, or 26.5% to $5.3 million. While the acquisition of Auburn  
contributed a total of $774,049 to the interest income increase on loans,  
the interest on loans was also higher as loans repriced at higher rates.  
Interest earned on securities increased as securities matured and the  
proceeds were reinvested in higher yielding securities along with the  
acquisition which contributed $348,245. Loans on one-to-four family  
residences held in the portfolio increased 16.0% to $34.0 million while  
commercial real estate increased 14.4% to $13.1 million. Additionally,  
consumer, student and non-mortgage commercial loans outstanding at  
December 31, 1995 increased $3.9 million. Interest income on investment  
and mortgage backed securities increased 38.3% to $1.6 million from $1.2  
million in 1994. 
 
Interest Expense. Interest expense increased $1.0 million, or 37.0%,  
compared to 1994. This increase was due in large part (by approximately  
$550,000) to the acquisition of Auburn, and increased interest rates paid on  
deposits. Deposit interest expense increased from $2.4 million in 1994 to  
$3.6 million in 1995, or 48.7%, while interest on borrowings, consisting of  
advances from the FHLB declined 38.3% to $231,154, as those liabilities  
were paid as they matured. 
 
Net Interest Income. Net interest income represents the difference between  
income derived from interest earning assets and the expense on interest- 
bearing liabilities. Net interest income is affected by both (i) the difference
between the rates of interest earned on interest-earning assets and the rates  
paid on interest-bearing liabilities ("interest rate spread") and (ii) the  
relative amounts of interest-earning assets and interest-bearing liabilities. 
 
Net interest income increased $607,549, or 23.2%, to $3.2 million in 1995  
compared to $2.6 million in 1994. This was the result of the yield on  
interest-earning assets increasing from 7.0% to 7.7% while the cost on  
interest-bearing liabilities increased from 4.0% to 4.7%. The Company had  
a ratio of interest-earning assets to interest-bearing liabilities of 112.6%,  
therefore, the net interest margin increased from 3.4% to 3.6% in 1995. 
 
Provision For Loan Losses. The provision for loan losses increased  
$34,750 from $5,000 in 1994 to $39,750 in 1995. At December 31, 1995,  
the allowance for loan losses was $826,364, which was 1.3% of gross  
loans outstanding. At December 31, 1994, this ratio was 1.1%. Provisions  
for 1995 increased due in part to the Auburn acquisition and in part to the  
uncertainty surrounding the possible downsizing of Ft. Riley, a military  
base in the Manhattan market. In May, 1995, the Base Realignment and  
Closure Commission and Congress determined that a downsizing of  
approximately one-third of total troop strength would occur at Ft. Riley. It  
was not felt that this would have a materially adverse impact on the  
Company's loan portfolio. Management determined, after an assessment of  
these and other factors, including the quality of the portfolio, to reduce the  
provision during the third and fourth quarters of 1995. These factors will  
continue to be assessed and further changes in the provision will be made if  
circumstances warrant. Net charge-offs in 1995 declined to $4,835,  
compared to $30,164  
in 1994. 
 
Noninterest Income. Noninterest income increased 53.6% to $526,660  
from $342,879 in 1994. The increase resulted from an increase in gains on  
the sale of loans from $79,136 in 1994 to $95,425 in 1995 and a significant  
increase of 54.6% in fees and service charges for deposit accounts and fees  
on loans to $391,314 from $253,049 in 1994. Of the increases in fees,  
$66,811 was attributed to the Auburn acquisition. The increase of $29,227  
from 1994 for other income included a gain on the sale of some securities  
which were held in available-for-sale of $5,470 along with an increase of  
$6,523 in certificate of deposit early withdrawal penalty income.  
Additionally, the acquisition of Auburn contributed $9,630 to this increase  
in other income. 
 
Noninterest Expense. Noninterest expense increased $748,148, or 40.0%,  
to $2.6 million. Of this amount, $537,486 was attributable to the Auburn  
acquisition, of which $82,045 was the amortization of goodwill and core  
deposit intangibles due to the purchase accounting method utilized in the  
acquisition. Compensation and benefits increased $356,542, or 44.1%,  
including incentive plan accruals of $55,500 in 1995 compared to $16,900  
in 1994. Other expenses increased $139,872 or 32.3%, due to a number of  
factors as well as due to the acquisition, which contributed $102,380 to  
this amount. Professional fees increased from $97,575 to $139,848. This  
increase included $44,926 for a consulting study conducted in an effort to  
review, standardize and consolidate operating activities performed by the  
Company's subsidiaries. Because of the steps taken as a result of the study,  
the Company believes it will enhance earnings and reduce expenses during  
the coming years. Data processing increased $14,580 compared to 1994  
and Federal Deposit Insurance premiums increased 10.2% to $161,028.  
Occupancy and equipment expenses increased $80,299, or 34.6%, due to  
the acquisition and increased depreciation expense for new data processing  
equipment. 
 
 
 
Capital Resources And Liquidity 
 
Assets. The Company's total assets increased to $103.4 million at  
December 31, 1996 compared to $101.2 million at December 31, 1995.  
The primary ongoing sources of funds of the Company are deposits,  
proceeds from principal and interest payments on loans and mortgage- 
backed securities and proceeds from the sale of mortgage loans and  
mortgage-backed securities. While maturities and scheduled amortization  
of loans are a predictable source of funds, deposit flows and mortgage  
prepayments are greatly influenced by general interest rates, economic  
conditions, competition and the restructuring of the financial services  
industry. 
 
The primary investing activities of the Company are the origination of loans  
and the purchase of investment securities. During the years ended  
December 31, 1996, 1995 and 1994, the Company originated mortgage  
loans in the amounts of $29 million, $20 million, and $15 million,  
respectively. Mortgage loans originated for retention in the Company's  
portfolio, which includes commercial real estate loans, amounted to $19.9  
million, $9.5 million and $9.0 million for the years ended December 31,  
1996, 1995 and 1994, respectively. The balance of the loans originated  
were sold in the secondary market. Generally, the Company originates  
fixed rate mortgage loans for immediate sale and does not originate and  
warehouse those loans for resale in order to speculate on interest rates.  
During the years ended December 31, 1996, 1995 and 1994, the Company  
originated a total of consumer, commercial non-mortgage, and guaranteed  
student loans of approximately $11.1 million, $9.4 million, and $12.3  
million, respectively. Management will continue its efforts to diversify the  
loan portfolio. 
 
During the years ended December 31, 1996, 1995 and 1994, the Company  
purchased securities to be held-to-maturity and available-for-sale in the  
amounts of $15.6 million, $16.1 million, and $8.4 million, respectively.  
This was funded primarily by deposits, maturities of existing securities and  
by the sale of fixed-rate mortgage loans totaling $10.3 million, $10.6  
million, and $6.5 million, in 1996, 1995 and 1994, respectively. 
 
The quality of the loan portfolio continues to be strong as evidenced by the  
small number and amount of loans past due 30 days or more. As of  
December 31, 1996, three real estate loans were more than 30 days past  
due with a total balance of $95,586, which is 0.2% of total loans  
outstanding. Additionally, four residential loans totaling $53,916 were on  
non-accrual status as of December 31, 1996. Excluding guaranteed student  
loans, there were six consumer loans over 30 days past due in the amount  
of $10,431, which was less than 0.1% of total loans outstanding. Three  
commercial loans with a balance of $173,197, or 0.3% of the portfolio,  
were over 30 days past due.  One SBA loan with a balance of $86,217 was  
on non-accrual.  During 1996, approximately $19,000 was charged off on  
this loan and the remaining amount of $86,217 is the guaranteed portion  
and will be recovered. 
 
 
Liabilities. Interest-bearing liabilities at December 31, 1996 totaled $85.1  
million. This is a slight increase from $84.6 million at December 31, 1995. 
  
The deposit base continues to diversify consistent with management's  
overall efforts to lower interest costs. Noninterest-bearing demand deposits  
increased $.6 million from December 31, 1995 to $5.3 million, or 6.1% of  
total deposits at December 31, 1996. NOW account deposits increased  
$2.0 million to $15.2 million at the end of 1996 from $13.2 million at  
December 31, 1995 and represented 17.5% of the deposit base at  
December 31, 1996, compared to 15.2% at December 31, 1995. Savings  
accounts represented 6.0%, compared to 6.8% at the end of 1995, and  
certificates of deposit represented 54.6% of the deposit base at December  
31, 1996, compared to 56.4% of the deposit base at the end   
of 1995. 
 
Certificates of deposit at December 31, 1996 which were scheduled to  
mature in one year or less totaled $34.7 million. Historically, maturing  
deposits have remained and management believes that a significant portion  
of the deposits maturing in one year or less will remain with the Company  
upon maturity. 

Cash Flows. Cash flow from operating activities was $2.4 million for the  
year ended December 31, 1996, compared to $0.5 million for 1995. 
	   
Net cash used in investing activities was $1.6 million in 1996 compared to  
$1.2 million in 1995. Net loans decreased approximately $0.5 million in  
1996 versus an increase of $0.9 million in 1995 and a decline of $2.3  
million in 1994. Maturities and prepayments of investment securities held- 
to-maturity were $6.9 million in 1996 versus $7.5 million in 1995 and $8.8  
million in 1994. Purchases of securities held-to-maturity declined to $0.9  
million in 1996 compared to $6.3 million in 1995. Purchases of securities  
available-for-sale in 1996 were $14.7 million compared to $9.8 million in  
1995. 
 
Net cash provided by financing activities was $0.9 million in 1996  
compared to $2.0 million provided in 1995. Deposits increased $.3 million  
in 1996 compared to $5.9 million in 1995.  FHLB advances increased $.8  
million in 1996 compared to a decrease of $3.8 million  
in 1995. 

Liquidity. The Company's most liquid assets are cash and cash equivalents  
and investment securities available-for-sale. The levels of these assets are  
dependent on the Company's operating, financing, lending and investing  
activities during any given period. At December 31, 1996, and 1995 these  
assets totaled $27.7 million and $18.8 million, respectively. During periods  
in which the Company is not able to originate a sufficient amount of loans  
and/or periods of high principal prepayments, the Company increases its  
liquid assets by investing in short-term U.S. Government and agency  
securities. 
 
Liquidity management is both a daily and long-term function of  
management strategy. Excess funds are generally invested in short-term  
investments. In the event that the Company requires funds beyond its  
ability to generate them internally, additional funds are available through  
the use of FHLB advances, a line of credit with the FHLB, or through sales  
of securities.  At December 31, 1996, the Company had outstanding FHLB  
advances of $3.3 million, and no borrowings were outstanding on its $12.0  
million line of credit with the FHLB. Additionally, the Company has  
guaranteed a loan made to the Company's Employee Stock Ownership  
Plan (the "ESOP") with a balance at December 31, 1996 of $315,020. The  
loan was made to fund the ESOP's purchase of shares in the Company's  
common stock offering in 1993. The total other borrowings by the  
Company were $3.6 million at December 31, 1996, compared to $2.9  
million at December 31, 1995. 
 
At December 31, 1996, the Company had outstanding loan commitments  
of $6.9 million. Management anticipates that sufficient funds will be  
available to meet current loan commitments. These commitments consist of  
letters of credit, unfunded lines of credit and commitments to finance real  
estate loans. The following table shows the commitments outstanding for  
each category. 
 
<TABLE>
<CAPTION>
 
LOAN COMMITMENTS 
                                 				Amount 
<S>                                  <C>
Letters of credit		                  $386,350 
Unfunded lines of credit	            4,149,374 
Real Estate Loans:	 
Construction			                      1,964,720 
Purchases	  		                         365,879 
Total				                            $6,866,323 
</TABLE>
 
Capital. The Federal Reserve Board has established capital requirements  
for bank holding companies which generally parallel the capital  
requirements for national banks under the Office of the Comptroller of the  
Currency (the "OCC") regulations. The regulations provide that such  
standards will generally be applied on a bank-only (rather than a  
consolidated) basis in the case of a bank holding company with less than  
$150 million in total consolidated assets, such as the Company. The  
Company's total capital of $11.3 million is, however, well in excess of the  
Federal Reserve Board's consolidated minimum capital requirements. 
 
At December 31, 1996, the Bank continued to maintain a sound Tier 1  
capital ratio of 8.70% and a risk based capital ratio of 18.22%. As shown  
by the following table, the Bank's capital exceeded the minimum capital  
requirements: (dollars in thousands) 

<TABLE>
<CAPTION> 
				                         Amount	  Percent	  
Required
<S>                          <C>      <C>       <C> 
Tier 1 Leverage Capital	     $8,956		 8.70%		   4.00% 
Risk Based Capital		         $9,616		18.22%	    8.00%
</TABLE> 
 
Banks and bank holding companies are generally expected to operate at or  
above the minimum capital requirements. The above ratios are well in  
excess of regulatory minimums and should allow the Company to operate  
without capital adequacy concerns. The Federal Deposit Insurance  
Corporation Improvement Act of 1991 establishes a bank rating system  
based on the capital levels of banks. The Bank is rated "well capitalized",  
which is the highest rating available under this capital-based rating system. 
 
Dividends 

During 1996, dividends of $.32 per share were paid to the stockholders and  
a 5% stock dividend was paid August 12, 1996 to all stockholders of  
record on July 29, 1996.  The cash dividend is an increase from 1995 of  
$.08 per share. 
 
The National Bank Act imposes limitations on the amount of dividends that  
a national bank may pay without prior regulatory approval. Generally, the  
amount is limited to the bank's current year's net earnings plus the adjusted  
retained earnings for the two preceding years. 
 
The payment of dividends by any financial institution or its holding  
company is affected by the requirement to maintain adequate capital  
pursuant to applicable capital adequacy guidelines and regulations. As  
described above, the Bank exceeded its minimum capital requirements  
under applicable guidelines as of December 31, 1996. As of December 31,  
1996, approximately $.8 million was available to be paid as dividends to the  
Company by the Bank. 
 
Impact Of Recently Issued Accounting Standards 
In 1996, the Company adopted Statement of Financial Accounting  
Standard (SFAS) No. 122 related to mortgage loan origination costs in  
1996 and the related impact on the financial statements was immaterial.  
The Company also adopted SFAS No. 123, "Accounting for Stock-Based  
Compensation" in 1996. The Company has chosen not to apply the  
accounting provisions of SFAS No. 123 in its financial statements, but  
rather to disclose proforma amounts if materially different from reported  
results. 
 
The Company will adopt SFAS Nos. 125 and 127 relating to transfers and  
servicing of financial assets and extinguishments of liabilities during 1997  
and 1998, according to the effective dates required by SFAS No. 125 and  
127. The adoption of the statements is not expected to have a material  
effect on the financial statements. 
 
Effects Of Inflation 

The Company's financial statements and accompanying footnotes have been  
prepared in accordance with GAAP (generally accepted accounting  
principles), which generally requires the measurement of financial position  
and operating results in terms of historical dollars without consideration for  
changes in the relative purchasing power of money over time due to  
inflation. The impact of inflation can be found in the increased cost of the  
Company's operations because the assets and liabilities of the Company are  
primarily monetary and interest rates have a greater impact on the  
Company's performance than do the effects of inflation. 
 
Asset/Liability Management 

Since the mid 1980s, the Bank has emphasized the origination of adjustable  
rate mortgages for portfolio retention to reduce the sensitivity of its  
earnings to interest rate fluctuations. Interest rate "gap" analysis is a  
common, though imperfect, measure of interest rate risk which measures  
the relative dollar amounts of interest-earning assets and interest-bearing  
liabilities which reprice within a specific time period, either through  
maturity or rate adjustment. The "gap" is the difference between the  
amounts of such assets and liabilities that are subject to such repricing. A  
"positive" gap for a given period means that the amount of interest-earning  
assets maturing or otherwise repricing within that period exceeds the  
amount of interest-bearing liabilities maturing or otherwise repricing during  
that same period. In a rising interest rate environment, an institution with a  
positive gap would generally be expected, absent the effects of other  
factors, to experience a greater increase in the yield of its assets relative  
to  
the cost of its liabilities. Conversely, the cost of funds for an institution  
with a positive gap would generally be expected to decline less quickly than  
the yield on its assets in a falling interest rate environment. Changes in  
interest rates generally have the opposite effect on an institution with a  
"negative" gap. 
 
Following is the "static gap" schedule for the Company. All loans are based  
on scheduled repricing, with no prepayment assumptions. Mortgage- 
backed securities are based on assumed maturities. All  assets are reflected  
at amortized cost. 
 
Certificates of deposit reflect contractual maturities only. Money market  
accounts are rate sensitive and have been included as repricing immediately  
in the first period. Savings and NOW accounts are not as rate sensitive as  
money market accounts and for that reason are not included in the  
calculation. 
 
The Company has been successful in meeting the interest sensitivity  
objectives set forth in its policy. This has been accomplished primarily by  
managing the assets and liabilities while maintaining the traditional high  
credit standards of the Company. 
 
Management believes the Company is appropriately positioned for future  
interest rate movements, although it may experience some fluctuations in  
net interest income due to short term timing differences between the  
repricing of assets and liabilities. 

<TABLE>
<CAPTION>

Interest-Earning Assets And Interest-Bearing Liabilities Repricing Schedule  
("GAP" Table) 
 
 
                               At December 31, 1996 
                              (dollars in thousands) 
		                                     More than	  More than		 
			                       3 months	    3 to 6		    6 to 12		  1 to 3		3 to 5		Over  
			                       or less		    months		    months		   years		 years		 5 years	 Total 
<S>                       <C>          <C>         <C>        <C>     <C>     <C>      <C>   
Interest-earning assets 
Overnight investments	    $3,956		     $0		        $0		       $0		    $0		    $0		     $3,956   
Investment securities	     3,185		      1,972		     2,453		    9,442		 3,822		   631		 21,505 
Mortgage-backed  
securities		                 993		         67		     3,328		    6,644		   702		     0		 11,734 
Loans			                  15,934		      8,748		     15,849		   12,119		4,530		  5,991		63,171 
Total interest-earning  
assets			                 $24,068	     $10,787	     $21,630	   $28,205	$9,054		$6,622		 $100,366 
 
Interest-bearing 
liabilities 
Certificates of deposit	   $9,015		    $7,714		     $17,947	   $10,673	$2,002		$0		     $47,351 
Money market deposit  
accounts		                 13,785		         0             0          0      0		  0        13,785 
Borrowed money	               500		       300		       2,044		      597		  112		 62		       3,615 
Total interest-bearing  
liabilities		             $23,300	     $8,014		     $19,991	    $11,270	$2,114		$62		   $64,751 
 
Interest sensitivity gap  
per period		                 $768		    $2,773		      $1,639		   $16,935	$6,940		$6,560		$35,615 
Cumulative interest  
sensitivity gap		            $768		    $3,541		      $5,180		   $22,115	$29,055	$35,615       0
 
Cumulative gap as a 
percent of total 
interest earning  assets			 0.77%		     3.53%		       5.16%		    22.03%	28.95%	 35.49% 
 
Cumulative interest  
sensitive assets 
as a percent of  
cumulative interest 
sensitive liabilities	    103.30%	    111.31%	       110.10%	   135.34%	144.91%	155.00%   
</TABLE> 
 
 
Safe Harbor Statement under the Private Securities  
Litigation Reform Act of 1995 
 
This annual report, including the President's Letter to Stockholders,  
contains certain forward looking statements within the meaning of Section  
27A of the Securities Act of 1933, as amended and Section 21E of the  
Securities Exchange Act of 1934, as amended.  The Company intends such  
forward-looking statements to be covered by the safe harbor provisions for  
forward-looking statements contained in the Private Securities Reform Act  
of 1995, and is including this statement for purposes of these safe harbor  
provisions.  Forward-looking statements, which are based on certain  
assumptions and describe future plans, strategies and expectations of the  
Company, are generally identifiable by use of the words "believe,"  
"expect," "intend," "anticipate," "estimate," "project" or similar  
expressions.  The Company's ability to predict results or the actual effect  
of future plans or strategies is inherently uncertain.  Factors which could  
have a material adverse affect on the operations and future prospects of the  
Company and the subsidiary include, but are not limited to, changes in:  
interest rates, general economic conditions, legislative/regulatory changes,  
monetary and fiscal policies of the U.S. Government, including policies of  
the U.S. Treasury and the Federal Reserve Board, the quality or  
composition of the loan or investment portfolios, demand for loan  
products, deposit flows, competition, demand for financial services in the  
Company's market area and accounting principles, policies and guidelines.   
These risks and uncertainties should be considered in evaluating forward- 
looking statements and undue reliance should not be placed on such  
statements.  Further information concerning the Company and its business,  
including additional factors that could materially affect the company's  
financial results, is included in the Company's filings with the Securities  
and Exchange Commission. 
 
Independent Auditors' Report 
 
The Board of Directors 
MNB Bancshares, Inc.: 
 
We have audited the accompanying consolidated balance sheets of MNB  
Bancshares, Inc. and subsidiary (the Company) as of December 31, 1996  
and 1995 and the related consolidated statements of earnings,  
stockholders' equity and cash flows for each of the years in the three-year  
period ended December 31, 1996.  These financial statements are the  
responsibility of the Company's management.  Our responsibility is to  
express an opinion on these consolidated financial statements based on our  
audits. 
 
We conducted our audits in accordance with generally accepted auditing  
standards.  Those standards require that we plan and perform the audit to  
obtain reasonable assurance about whether the financial statements are free  
of material misstatement.  An audit includes examining, on a test basis,  
evidence supporting the amounts and disclosures in the financial  
statements.  An audit also includes assessing the accounting principles used  
and significant estimates made by management, as well as evaluating the  
overall financial statement presentation.  We believe that our audits provide  
a reasonable basis for our opinion. 
 
In our opinion, the financial statements referred to above present fairly, in  
all material respects, the financial position of the Company as of December  
31, 1996 and 1995 and the results of its operations and its cash flows for  
each of the years in the three-year period ended December 31, 1996, in  
conformity with generally accepted accounting principles. 
 
/s/ KPMG Peat Marwick 
Kansas City, Missouri 
January 31, 1997 
 
 
<TABLE>
<CAPTION>

MNB BANCSHARES, INC. AND SUBSIDIARY 
 
Consolidated Balance Sheets December 31, 1996 and1995 

Assets		                    1996		        1995 
<S>                         <C>           <C> 
Cash and cash equivalents: 
Cash									               $2,670,159	   $2,136,418 
Interest-bearing deposits 
in other financial 
institutions		               1,900,000	      787,599 
Total cash and cash 
equivalents					             4,570,159	    2,924,017 
 
Investment securities: 
Held-to-maturity 						    	10,113,010	   16,403,035 
Available-for-sale							   23,125,844	   15,925,916 
Loans, net 							         	62,369,858	   61,883,135 
Loans held-for-sale							     179,190	      699,129 
Premises and equipment, 
net of accumulated 
depreciation		               1,325,798	    1,384,052 
Accrued interest and other 
assets 					                 1,736,565	    1,965,652 
Total assets				           	$103,420,424	$101,184,936 

Liabilities and 
Stockholders' Equity 
Liabilities:			 
Deposits:			 
Noninterest-bearing demand				$5,260,221	  $4,651,830 
Money market and NOW						    28,936,080	  27,121,850 
Savings								                5,162,275	   5,908,323 
Time, $100,000 and greater					6,760,011   	7,317,517 
Time, other				              	40,591,363	  41,399,923 
Total deposits							        	86,709,950	  86,399,443 
 
Federal funds purchased						          0    		325,000 
Other borrowings							        3,615,020	   2,555,915 
Accrued interest and 
expenses, taxes and other 
liabilities		                  1,761,289	   1,094,329 
Total liabilities	 						    	92,086,259  	90,374,687 
 
Stockholders' equity:			 
Common stock, $.01 par, 
1,500,000 shares authorized;  
605,215 and 576,514 shares 
issued and outstanding at  
1996 and 1995							               6,052  		    5,765 
Additional paid-in capital					6,321,016  	 5,726,704 
Retained earnings	 						      5,340,873	   5,410,733 
Unearned employee benefits						(315,020)	   (355,915) 
Unrealized gain (loss) on 
investment securities available- 
for-sale, net of tax  							    (18,756)	     22,962 
Total stockholders' equity					11,334,165	 10,810,249 
 
Commitments and contingencies					     0		         0 
Total liabilities and 
stockholders' equity			      	$103,420,424	$101,184,936 
 
See accompanying notes to consolidated financial statements 
</TABLE>  
 
 
<TABLE>
<CAPTION> 
 
MNB BANCSHARES, INC. AND SUBSIDIARY 
 
Consolidated Statements of Earnings Years ended December 31, 1996, 1995 
and1994	

                            1996		      1995		        1994 
<S>                         <C>         <C>           <C> 	 
Interest income:		 
Loans							                $5,704,030	 $5,287,738	   $4,180,899 
Investment securities					   1,852,665	  1,595,203	    1,153,027 
Other							                    13,214		   167,822	       77,382 
Total interest income					   7,669,909	  7,050,763	    5,411,308 
				 
Interest expense:				 
Deposits 						              3,859,838 	 3,588,740	    2,413,619 
Other borrowings					          189,312	    231,154	      374,369 
Total interest expense					  4,049,150	  3,819,894	    2,787,988 
 
Net interest income					     3,620,759	  3,230,869	    2,623,320 
 
Provision for loan losses 				  15,000		    39,750		       5,000 
Net interest income after 
provision for loan losses	   3,605,759	  3,191,119	    2,618,320 
 
Noninterest income: 
Fees and service charges				   517,124	    391,314	      253,049 
Gains on sales of loans				     75,450		    95,425		      79,136 
Other							                    90,723		    39,921		      10,694 
Total noninterest income				   683,297	    526,660	      342,879 
 
Noninterest expense: 
Compensation and benefits				1,220,615	  1,165,023  	    808,481 
Occupancy and equipment				    376,823	    312,224	      231,925 
Federal deposit insurance 
premiums			                    570,633	    161,028	      146,138 
Data processing					           115,312	    124,679	      110,099 
Amortization						             112,097	     82,045		           0 
Stationery, printing and 
office supplies 		              85,405		    59,519		      41,872 
Professional fees					         151,041	    139,848	       97,575 
Other							                   601,266	    573,460	      433,588 
Total noninterest expense				3,233,192	  2,617,826	    1,869,678 
 
Earnings before income taxes	1,055,864  	1,099,953	    1,091,521 
 
Income taxes 						            339,334	    346,547	      397,610 
Earnings before 
extraordinary item			          716,530	    753,406	      693,911 
 
Extraordinary loss on early 
retirement of  
other borrowings, net of tax	 			    0		         0		      38,960 
Net earnings						            $716,530	   $753,406	     $654,951 
 
Earnings per share: 
Before extraordinary loss				 $1.14		     $1.24		       $1.27 
Extraordinary loss on early 
retirement of  
other borrowings					             0		         0		        0.07 
Net earnings per share 				   $1.14		     $1.24		       $1.20 
 
Average common and common 
equivalent shares 
outstanding					              630,864	    606,320	      547,551 
 
See accompanying notes to consolidated financial statements 
</TABLE>
 
<TABLE>
<CAPTION>
 
MNB BANCSHARES, INC. AND SUBSIDIARY 
 
Consolidated Statements of Stockholders' Equity Years ended December 31, 
1996, 1995 and 1994 
 
	                	                                   		                   Net 
								                             Additional		             Unearned	   unrealized gain   
						                  Common       paid-in	     Retained	   employee	   (loss) on 
						                  stock		      capital		    earnings	   benefits	   securities	      Total 
<S>                     <C>          <C>          <C>         <C>         <C>              <C> 
Balance at December 31, 
1993		                  $4,629	      3,998,943	   5,127,919	  (429,662)	             0 		   8,701,829 
January 1, 1994 
adoption of Statement 
of Financial Accounting 
Standards No. 115 - 
unrealized loss on 
investment securities 
available-for-sale, 
net of tax			                0		             0		          0	         0		       (278)	          (278) 
Net earnings					            0 		            0 		   654,951	         0 		            0		       654,951 
Dividends paid ($.23 
per share)		                 0		             0		   (119,834)	        0		             0		      (119,834) 
Reduction of unearned 
employee benefits	           0		             0		          0		   35,595	              0		        35,595 
Issuance of 2,375 shares 
under stock option 
plan						                  24		        23,726		          0		        0		             0		        23,750 
5% stock dividend 
(23,150 shares)		          231		       373,156	    (373,387)	        0		             0		             0 
Changes in fair value 
of investment  
securities available-
for-sale, net of tax	        0		             0		          0		        0		      (181,977)	      (181,977) 
Balance at December 31, 
1994		                   4,884		      4,395,825	  5,289,649	   (394,067)	     (182,255)	       9,114,036 
Net earnings					            0		              0		   753,406	          0		            0		       753,406 
Dividends paid ($.24 
per share)		                 0 		             0		  (139,018)	         0		            0		      (139,018) 
Reduction of unearned 
employee benefits	           0		              0		         0		    38,152  	           0		         38,152 
Issuance of 52 shares 
under stock option 
plan					                    1		            519		         0		         0		            0		            520 
5% stock dividend 
(27,342 shares)		          273		        493,031	   (493,304)  	       0		            0		              0 
Issuance of 60,720 shares 
in purchase  
acquisition					           607		        837,329	          0		         0		            0		        837,936 
Change in fair value of 
investment securities 
available-for-sale, 
net of tax		                 0		              0		         0		         0		       205,217	       205,217 
Balance at December 31, 
1995		                   5,765		      5,726,704	  5,410,733	    (355,915)	       22,962		      10,810,249 
 
Net earnings					            0		              0		   716,530	           0		            0		         716,530 
Dividends paid ($.32 
per share)		                 0		              0		  (191,791)	          0		            0		       (191,791) 
Reduction of unearned 
employee benefits	           0		              0		         0 		    40,895 	            0		        40,895 
5% stock dividend 
(28,701 shares)		          287		        594,312	   (594,599)	          0		            0		             0 
Change in fair value 
of investment securities 
available-for-sale, 
net of tax		                 0		              0		         0		          0  		    (41,718)	       (41,718) 
Balance at December 31, 
1996		                  $6,052		       6,321,016	 5,340,873	    (315,020)	      (18,756)	        11,334,165 
 
See accompanying notes to consolidated financial statements 
</TABLE>
 
<TABLE>
<CAPTION>
 
MNB BANCSHARES, INC. AND SUBSIDIARY 
 
Consolidated Statements of Cash Flows Years ended  
December 31, 1996, 1995 and 1994 
 
                                		1996          1995          1994 
<S>                               <C>           <C>           <C>
Cash flows from operating 
activities: 
Net earnings   					              $716,530	     $753,406	     $654,951 
Adjustments to reconcile net 
earnings to net cash provided 
by operating activities: 
Provision for loan losses	   		     15,000		      39,750	   	    5,000 
Depreciation and amortization   		 315,757	      241,850	      124,860 
Amortization of loan fees			       (44,858)	     (36,798)	     (44,390) 
Deferred income taxes			           (53,365)   	 (194,727)	     (23,762) 
Net (gain) loss on sales of 
investment securities available
-for-sale			                        15,213		      (5,470)	           0 
Net gain on sales of loans			      (75,450)   	  (95,425)	     (79,136) 
Loss on sale of premises and 
equipment	                           7,454	   	        0             0 
Proceeds from sale of loans			    10,316,625	    10,630,608	   6,510,198 
Origination of loans for sale			  (9,721,236)	   (11,234,312)	 (5,941,709) 
Accretion of discounts and 
amortization of premiums on 
investment securities, net	           12,969		      (34,399)	      77,310 
Changes in assets and liabilities: 
Accrued interest and other assets		  138,334	        57,908	      (33,524) 
Accrued expenses, taxes and other 
liabilities	                         744,068	       364,626	     (397,928) 
Net cash provided by operating 
activities	                        2,387,041	       487,017	      851,870 
 
Cash flows from investing 
activities: 
Net (increase) decrease in loans		  (485,488)	      878,548      (2,266,854) 
Maturities and prepayments of 
investment  
securities held-to-maturity			     6,905,474	      7,538,050	     8,807,120 
Purchases of investment securities  
held-to-maturity				                (898,789)	    (6,253,745)	   (8,377,811) 
Maturities and prepayments of 
investment 
securities available-for-sale			    4,159,394	     5,036,531	       134,480 
Purchases of investment securities  
available-for-sale 				            (14,681,433)	  (9,831,440)	            0 
Proceeds from sale of investment 
securities 	 
available-for-sale				               3,511,808	    1,139,674	             0 
Proceeds from sales of foreclosed 
assets	                                  7,279		      90,972		       78,929 
Purchases of premises and equipment, 
net	                                  (152,860)	     (97,193)	     (115,273) 
Net cash received from Auburn 
acquisition	                                 0		     317,115	             0 
Net cash used in investing 
activities		                        (1,634,615)	  (1,181,488)	   (1,739,409) 
 
Cash flows from financing 
activities:				 
Net increase in deposits			            310,507	    5,920,757         89,068 
Net decrease in securities sold 
under agreements to repurchase			            0		           0 		  (3,000,000) 
Federal Home Loan Bank advances  
(repayment) and federal funds 
purchased,  net						                  775,000	   (3,775,000)	      600,000 
Issuance of common stock under stock 
option plan					                             0		         520		       23,750 
Payment of dividends				              (191,791)	     (139,018)	    (119,834) 
Net cash provided by (used in) 
financing activities					              893,716	     2,007,259	   (2,407,016) 
Net increase (decrease) in cash and 
cash equivalents					                 1,646,142	    1,312,788 	  (3,294,555) 
 
Cash and cash equivalents at 
beginning of  year						              2,924,017	    1,611,229	    4,905,784 
Cash and cash equivalents at end 
of year	                              $4,570,159	   $2,924,017	   $1,611,229 
 
Supplemental disclosure of cash 
flow information: 
Cash paid during the year for 
income taxes	                          $531,000	      $522,000	     $568,000 
Cash paid during the year for 
interest		                           $4,206,000     $3,860,000	   $2,820,000 
 
Supplemental schedule of 
noncash investing activities-  
transfer of loans to real estate  
owned						                           $ 29,000	            $0        $76,000 
 
See accompanying notes to consolidated financial statements. 
</TABLE>
 
MNB BANCSHARES, INC. AND SUBSIDIARY 
 
Notes to Consolidated Financial Statements 
December 31, 1996, 1995 and 1994 
(1) Summary of Significant Accounting Policies 
  
(a) 	Principles of Consolidation 
The accompanying consolidated financial statements include the accounts  
of MNB Bancshares, Inc. (the Company) and its wholly-owned subsidiary,  
Security National Bank (formerly Manhattan National Bank and Security  
State Bank which were merged on December 31, 1995).  Intercompany  
balances and transactions have been eliminated in consolidation. 
  
(b) 	Investment Securities 
The Company classifies its investment securities portfolio as held-to- 
maturity, which are recorded at amortized cost, or available-for-sale, which  
are recorded at fair value with unrealized gains and losses excluded from  
earnings and reported in a separate component of stockholders' equity  
until realized, in accordance with Statement of Financial Accounting  
Standards (SFAS) No. 115, "Accounting for Certain Investments in Debt  
and Equity Securities."  Pursuant to SFAS No. 115 implementation  
guidance issued in 1995 by the Financial Accounting Standards Board  
(FASB), the Company reclassified certain held-to-maturity securities with  
aggregate cost and fair value of approximately $1,443,000 and $1,447,000,  
respectively, to available-for-sale in December 1995. 
  
Premiums and discounts are amortized over the estimated lives of the  
securities using a method which approximates the interest method.  Gains  
and losses on sales are calculated using the specific identification method. 
  
(c) 	Loans, Loans Serviced for Others and Related Earnings 
Management determines at the time of origination whether loans will be  
held for the portfolio or sold in the secondary market.  Generally, fixed rate  
mortgage loans are originated and underwritten for resale in the secondary  
mortgage market.  That decision depends on a number of factors, including  
the yield on the loan and the term of the loan, market conditions and the  
current gap position. 
  
Mortgage loans originated and intended for sale in the secondary market  
are recorded at the lower of aggregate cost or estimated fair value.  Fees  
received on such loans are deferred and recognized in income as part of the  
gain or loss on sale.  Net unrealized losses are recognized in a valuation  
allowance by charges to income.  Fees received on other loans in excess of  
amounts representing the estimated costs of origination are deferred and  
credited to interest income using the interest method. 
  
The FASB issued SFAS No. 114, "Accounting by Creditors for  
Impairment of a Loan," in 1993 and SFAS No. 118, "Accounting by  
Creditors for Impairment of a Loan- Income Recognition and  
Disclosures," in 1994.  SFAS No. 114 requires that impaired loans be  
measured based on the present value of expected future cash flows  
discounted at the loan's interest rate, at the loan's observable market  
price or at the fair value of the loan's collateral.  A loan is considered  
impaired when, based on current information and events, it is probable that  
a creditor will be unable to collect all amounts due according to the original  
terms of the loan agreement. The Company adopted the provisions of  
SFAS Nos. 114 and 118 on January 1, 1995.  The impact of these  
statements on the consolidated financial statements of the Company was  
immaterial. 
  
Accrual of interest on nonperforming loans is suspended when, in the  
opinion of management, the collection of such interest or the related  
principal is less than probable. Any interest received on non-accrual loans is  
credited to principal. 
 
The Company adopted the provisions of SFAS No. 122, "Accounting for  
Mortgage Servicing Rights," effective  
January 1, 1996.  Under the provisions of SFAS No. 122, the value of  
servicing rights are capitalized when the related loan is sold with servicing  
retained, and the resulting asset is amortized over the expected life of the  
loan.  The adoption of SFAS No. 122 was not material to the Company's  
reported results. 
  
(d)	Allowance for Loan Losses 
Provisions for losses on loans are based upon management's estimate of  
the amount required to maintain an adequate allowance for losses, relative  
to the risk in the loan portfolio.  The estimate is based on reviews of the  
loan portfolio, including assessment of the estimated net realizable value of  
the related underlying collateral, and upon consideration of past loss  
experience, current economic conditions and such other factors which, in  
the opinion of management, deserve current recognition.  Amounts are  
charged off as soon as probability of loss is established, taking into  
consideration such factors as the borrower's financial condition,  
underlying collateral and guarantees.  Loans are also subject to periodic  
examination by regulatory agencies.  Such agencies may require charge- 
offs or additions to the allowance based upon their judgments about  
information available at the time of their examination. 
  
(e)	Stock in Federal Home Loan Bank and Federal Reserve Bank 
The Bank is a member of the Federal Home Loan Bank (FHLB) and the  
Federal Reserve Bank (FRB) systems.  As a FHLB member, the Bank is  
required to purchase and hold stock in the FHLB of Topeka in an amount  
equal to the greater of (a) 1% of unpaid residential loans, (b) 5% of  
outstanding FHLB advances, or (c) 0.3% of total assets.  FHLB and FRB  
stock are included in available-for-sale securities. 
 
(f)	Premises and Equipment 
Premises and equipment are stated at cost less accumulated depreciation. 
Depreciation is provided principally using the straight-line method over the  
estimated useful lives, ranging from 3 to 31.5 years, of the assets.  Major  
replacements and betterments are capitalized while maintenance and repairs  
are charged to expense when incurred.  Gains or losses on dispositions are  
reflected in current operations. 
 
(g)	Intangible Assets 
The core deposit intangible asset and goodwill arising from the acquisition  
of Auburn Security Bancshares, Inc. (see note 2) is being amortized over  
ten (accelerated) and fifteen (straight-line) years, respectively.  When facts  
and circumstances indicate potential impairment, the Company evaluates  
the recoverability of asset carrying values, including intangible assets, using 
estimates of undiscounted future cash flows over remaining asset lives. 
When impairment is indicated, any impairment loss is measured by the  
excess of carrying values over fair values. 
  
(h)	Income Taxes 
The Company records deferred tax assets and liabilities for the future tax  
consequences attributable to differences between the financial statement  
carrying amounts of existing assets and liabilities and their respective  
income tax bases.  Deferred tax assets and liabilities are measured using  
enacted tax rates applied to taxable income in the years in which those  
temporary differences are expected to be recovered or settled.  The effect  
on deferred tax assets and liabilities of a change in tax rates is recognized  
in  
income in the period that includes the enactment date. 
  
(i)	Use of Estimates 
Management of the Company has made a number of estimates and  
assumptions relating to the reporting of assets and liabilities and the  
disclosure of contingent assets and liabilities to prepare these consolidated  
financial statements in conformity with generally accepted accounting  
principles.  Actual results could differ from those estimates. 
  
(j)	Earnings Per Share 
Earnings per share have been computed based upon the average number of  
common and common equivalent shares outstanding during each year. 
Earnings per share for all periods presented have been adjusted to give  
effect to the  
5% stock dividends paid by the Company in 1994, 1995 and 1996. 
 
(k)	Stock-based Compensation   
The Company adopted the provisions of SFAS No. 123, "Accounting for  
Stock-based Compensation," in 1996.  SFAS No. 123 requires that the  
value of options and similar stock-based compensation awarded to  
employees be recorded as compensation expense.  Alternatively, SFAS No.  
123 allows pro forma disclosure of net earnings and earnings per share as if  
the accounting provisions had been applied.  The Company has chosen not  
to apply the accounting provisions of SFAS No. 123 in its consolidated  
financial statements but rather to disclose pro forma amounts if materially  
different from reported results. 
  
(l)	Reclassification 
Certain amounts have been reclassified to conform to the current year  
presentation. 
 
 
(2)	Acquisition 
  
On April 1, 1995, the Company acquired Auburn Security Bancshares, Inc.  
(Auburn), and its wholly-owned subsidiary, Security State Bank. 
Subsequently, Manhattan National Bank and Security State Bank were  
merged.  Auburn had consolidated assets of approximately $20 million. 
The Company acquired 100% of the outstanding common stock of Auburn  
for approximately $2 million.  The purchase price, including related costs  
of acquisition, included cash of approximately $970,000 and 60,720 shares  
of the Company's common stock.  The acquisition, which was accounted  
for as a purchase, resulted in a core deposit intangible asset and goodwill of  
approximately $461,000 and $512,000, respectively. 
  
Pro forma revenues, net earnings and earnings per share amounts, as if the  
acquisition had been consummated  
January 1, 1994, are as follows: 
<TABLE>
<CAPTION>
                                      		1995		         1994 
<S>                                     <C>            <C>
Net interest income plus other  
income 				                             $3,963,462	    $3,621,412 
Net earnings before extraordinary  
loss					                                  781,822	       752,246 
Net earnings per share before 
extraordinary loss 			                        1.27		         1.22 

</TABLE>

(3) Investment Securities 
<TABLE>
<CAPTION>
 
A summary of investment securities information is as follows:		 
                       								          Gross		        Gross 
	                         Amortized	     unrealized	    unrealized	    Estimated 
								                  cost		         gains	         losses		       fair value 
<S>                       <C>            <C>            <C>            <C>
December 31, 1996:	 
Held-to-maturity: 
U.S. government 
and agency obligations 
maturing:	 
In less than one year						$3,093,600	   13,000	  	             0		     3,106,000 
After one year but within 
five years				              2,001,757	   18,000	                0		     2,020,000 
Subtotal							             5,095,357	   31,000	                0		     5,126,000 

Municipal obligations 
maturing: 
In less than one year 						    6,000		       0	                0		         6,000 
After one year but within 
five years 				             1,927,195	    5,000	            8,000		      1,924,000 
After five years but 
within ten years				          369,860	    2,000	            1,000		        371,000 
Subtotal							             2,303,055	    7,000	            9,000		      2,301,000 
				 
Mortgage-backed 
securities	  				           2,714,598	   16,000	 	          4,000	  	    2,727,000 
Total								               $10,113,010	 54,000		          13,000		     10,154,000 
 
Available-for-sale: 
U.S. government and agency 
obligations maturing:	 
		 
In less than one year						 $2,533,787	  19,389	 	          1,199		     2,551,977 
After one year but within 
five years	  			             9,346,028	  18,317	           47,050		     9,317,295 
Subtotal							             11,879,815	  37,706	           48,249		    11,869,272 
 
Municipal obligations 
maturing: 
In less than one year 						   400,000	       0		             934		       399,066 
After five years but within 
ten years				                  260,684	       0	              938		       259,746 
Subtotal							                660,684	       0	            1,872		       658,812 
 
Mortgage-backed securities				9,036,473 	28,036		          44,982		     9,019,527 
  FHLB stock							             941,700	      0	                0		       941,700 
  Other stock							            637,461	      0	              928		       636,533 
Total								               $23,156,133	 65,742	            96,031		   23,125,844 

December 31, 1995: 
Held-to-maturity: 
U.S. government and agency 
obligations maturing: 
In less than one year						 $5,752,027	  27,000	             3,000 		   5,776,000 
After one year but within 
five years	  			             6,101,371	  73,000	             4,000	  	  6,170,000 
Subtotal							             11,853,398	 100,000	             7,000		   11,946,000 
 
Municipal obligations 
maturing: 
In less than one year 						    56,000		      0		                0		       56,000 
After one year but within 
five years 				              1,035,600	   6,000		            2,000		    1,040,000 
After five years but 
within ten years				           376,218	   1,000		            5,000		      372,000 
Subtotal							              1,467,818	   7,000	             7,000		    1,468,000 
					 
Mortgage-backed securities			3,081,819	  14,000		           15,000		    3,081,000 
Total								              $16,403,035	 121,000	            29,000		   16,495,000 
 
Available-for-sale: 
U.S. government and agency 
obligations maturing: 
In less than one year 						3,701,090	   64,385		           15,767		    3,749,708 
After one year but within 
five years				             $5,580,890	   21,139		            5,102		    5,596,927 
Subtotal							             9,281,980	   85,524	            20,869		    9,346,635 
  
Mortgage-backed securities		5,665,064   	21,085		           50,568		    5,635,581 
  FHLB stock							           883,700        	0	                 0		      883,700 
  FRB stock							             60,000		       0	                 0		       60,000 
Total								              $15,890,744	 106,609             71,437	    15,925,916 
</TABLE>

Except for U. S. government and agency obligations, no investment in a  
single issuer exceeded 10% of stockholders' equity. 
 
At December 31, 1996 and 1995, securities pledged to secure public funds  
on deposit had a carrying value of approximately $20,315,000 and  
$17,065,000 
 
(4)	Loans 
<TABLE>
<CAPTION> 
Loans consist of the following at December 31: 
                           					1996		         1995
<S>                             <C>            <C> 
Mortgage loans:	 
One-to-four family residential 	$33,498,175	   33,979,182 
Commercial 				                  14,311,542	   13,104,277 
Commercial loans 			              7,139,729	    7,075,165 
Consumer loans 			                4,696,385	    4,293,951 
Student loans				                 3,708,718	    4,428,373 
Total					                       63,354,549	   62,880,948 
 
Less: 
Loans in process 			                 14,031		      12,430 
Deferred loan fees			               151,000	      159,019 
Allowances for loan losses		        819,660	      826,364 
Loans, net				                  $62,369,858	   61,883,135 
</TABLE>  
 
 
The Company is a party to financial instruments with off-balance sheet risk  
in the normal course of business to meet customer financing needs. These  
financial instruments consist principally of commitments to extend credit.  
The Company uses the same credit policies in making commitments and  
conditional obligations as it does for on-balance sheet instruments. The  
Company's exposure to credit loss in the event of nonperformance by the  
other party is represented by the contractual amount of those instruments.  
The Company does generally require collateral or other security on  
unfunded loan commitments. However, collateral is normally obtained with  
regard to irrevocable letters of credit. The Company's outstanding  
commitments to originate and sell loans are immaterial. 
 
The Company is exposed to varying risks associated with concentrations of  
credit relating primarily to lending activities in specific geographic areas.  
The Company's principal lending area consists of Manhattan, Kansas,  
Auburn, Kansas and the surrounding communities, and substantially all of  
the Company's loans are to residents of, or secured by, properties located  
in its principal lending area. Accordingly, the ultimate collectibility of the  
Company's loan portfolio is dependent upon market conditions in those  
areas. These geographic concentrations are considered in management's  
establishment of the allowance for loan losses. 
 
<TABLE>
<CAPTION>
A summary of the activity in the allowance for loan losses is as follows: 
 
                             	1996		        1995		        1994 
<S>                           <C>           <C>           <C> 
Balance at beginning of year		$826,364	     562,041	      587,205 
Provision				                   15,000		     39,750		       5,000 
Allowance for loan loss of  
acquired bank				                    0		     229,408	           0 
Charge-offs				                (27,136)	     (28,608)	    (45,732) 
Recoveries				                   5,432		      23,773	 	    15,568 
Balance at end of year 		     $819,660	      826,364	     562,041 
</TABLE>

At December 31, 1996 and 1995, impaired loans, as defined by SFAS No.  
114, aggregated approximately $145,000  
and $39,000. 
  
The Bank serviced loans for others of $25,901,000 and $20,958,000 at  
December 31, 1996 and 1995. Because the Bank sold significantly all loans  
originated for sale on a servicing released basis, no additional gains on sales 
or related mortgage servicing assets, as required under SFAS 122, were  
recorded during 1996. 
  
The Bank had loans to directors and officers at December 31, 1996 and  
1995 which carry terms similar to those for other loans.  A summary of  
such loans is as follows: 
<TABLE>
<CAPTION> 
                            	  	1996		           1995 
<S>                             <C>              <C> 
Balance at beginning of year 	   $114,036	        602,640 
New loans			                    1,265,583	         50,135 
Payments			                       (45,470)	      (538,739) 
Balance at end of year		       $1,334,149	        114,036 
</TABLE>

(5) Premises and Equipment 

<TABLE>
<CAPTION> 
Premises and equipment consist of the following at December 31: 
                                   		1996		        1995 
<S>                                  <C>           <C> 
Land					                             $253,412	     253,412 
Office buildings and improvements 	  1,272,000	    1,251,451 
Furniture and equipment		            1,024,330	    1,023,893 
Automobiles 				                       128,572	       69,453 
Total				 	                          2,678,314	    2,598,209 
 
Less accumulated depreciation 	      1,352,516	    1,214,157 
Total				                          	$1,325,798	    1,384,052 
</TABLE>  
 
(6) Time Deposits 
<TABLE>
<CAPTION>
Maturity of time deposits are as follows at December 31, 1996: 
 
Year    Amount 
<S>     <C> 
1997	   $34,676,551 
1998	   8,253,317 
1999	   2,419,797 
2000	   2,001,709 
Total	  $47,351,374 
 
</TABLE> 
 
During 1996, the Federal Deposit Insurance Corporation imposed a one- 
time special assessment on Savings Association Insurance Fund (SAIF)  
assessable deposits. The assessment on the Company's SAIF deposits was  
$449,000 and is included in federal deposit insurance premiums in the  
accompanying consolidated statements of earnings. 
 
 
(7) Other Borrowings 
  
Other borrowings include a note payable relating to the Company's  
Employee Stock Ownership Plan (the ESOP) (see note 9) with an  
unrelated financial institution and advances from the FHLB.  The ESOP  
loan of $315,020 and $355,915 at December 31, 1996 and 1995,  
respectively, bears interest at the prime rate (8.25% at December 31,  
1996), is due in 2002 and is secured by the 36,448 unallocated shares of  
Company common stock held by the ESOP.  Long-term advances from the  
FHLB at December 31, 1996 and 1995 amount to $3,300,000 and  
$1,800,000, respectively.  Maturities of such advances at December 31,  
1996 are summarized as follows: 

<TABLE>
<CAPTION> 
Year ending 
December 31,		  Amount	     Rates 
<S>             <C>         <C> 
1997			         $2,800,000	  5.66% to 8.10% 
1998			            500,000	  5.21% 
	               $3,300,000
</TABLE>  

The Company elected to prepay certain long-term FHLB advances during  
1994, resulting in an extraordinary loss, net of tax, of $38,960 in the  
accompanying consolidated 1994 statement of earnings. 
 
The Bank has a $12,000,000 line of credit, renewable annually in  
September, with the FHLB, under which there were borrowings  
outstanding of $400,000 at December 31, 1995.  Interest on any  
outstanding balances on the line of credit accrues at the federal funds rate  
plus .15% (7.15% at December 31, 1996). 
 
Although no loans are specifically pledged, the FHLB requires the Bank to  
maintain eligible collateral that has a lending value at least equal to its  
required  collateral.  Eligible collateral includes single and multifamily  
first  
mortgage loans, mortgage-backed securities, U.S. government and agency  
obligations, stock in the FHLB and FHLB overnight deposits. 
 
  
(8) Income Taxes 
<TABLE>
<CAPTION>
Total income tax expense for 1996, 1995 and 1994 is allocated as follows: 
 
                    			1996		      1995		     1994 
<S>                    <C>         <C>        <C> 
Operations		           $339,334	   346,547	   397,610 
Extraordinary loss	           0		        0		  (22,365) 
Stockholders' equity 	  (23,743)	  123,915	  (111,705) 
			                    $315,591	   470,462	   263,540 
</TABLE>

The components of income tax expense allocated to earnings before  
extraordinary loss are as follows: 

<TABLE>
<CAPTION> 
          		1996		      1995	        1994 
<S>         <C>         <C>          <C> 
Current	    $392,699	   524,692	     421,372 
Deferred	    (53,365)	 (178,145)	    (23,762) 
		          $339,334	   346,547	     397,610 
Federal	    $271,070	   346,547	     335,332 
State		       68,264		        0		     62,278 
		          $339,334	   346,547	     397,610 
</TABLE>  

The reasons for the difference between actual income tax expense and  
expected income tax expense allocated to earnings before extraordinary  
loss at the 34% statutory federal income tax rate are as follows: 

<TABLE>
<CAPTION> 
                        					1996		        1995		         1994 
<S>                          <C>           <C>            <C>
Expected income tax expense 
at statutory rate			         $358,994	     373,984	       371,117 
Tax-exempt interest			        (37,838)	    (14,707)	       (7,528) 
Nondeductible amortization		   11,752		      6,522		            0 
State income taxes			          45,064		          0		       41,103 
Other, net	  			              (38,628)	    (19,252)	       (7,082) 
					                        $339,334	     346,547	       397,610 
</TABLE>  
The tax effects of temporary differences that give rise to the significant  
portions of the deferred tax assets and liabilities at December31, 1996 and  
1995 are as follows: 
 
<TABLE>
<CAPTION>
	                            				1996		   1995 
<S>                              <C>      <C>
Deferred tax assets: 
Unrealized loss on investment 
securities available-for-sale		  $11,533	      0  
Allowance for loan losses		      108,646	 39,260 
Other	  				                      18,895 		8,463 
Total deferred tax assets		      139,074	 47,723 
 
Deferred tax liabilities: 
Unrealized gain on investment 
securities available-for-sale		        0		12,210 
Core deposit intangible		        109,006	135,367 
FHLB stock dividends		           167,994	143,446 
Premises and equipment		           7,294	 10,356 
State taxes				                   21,645		     0 
Other				                        	38,931		29,248 
Total deferred tax liabilities		 344,870	330,627 
Net deferred tax liability		    $205,796	282,904 

</TABLE>

(9) Employee Benefit Plans 
  
Qualified employees of the Company and the Bank may participate in an  
employee stock ownership plan (the ESOP).  The ESOP has borrowed  
under a bank loan agreement (note 7), the proceeds of which were used to  
acquire the Company's common stock.  Contributions, along with  
dividends on unallocated shares of common stock, are used by the ESOP  
to make payments of principal and interest on the bank loan.  Because the  
Company has guaranteed the ESOP's borrowing, the outstanding note  
payable balance is recorded as unearned compensation, which is presented  
as a reduction of stockholders' equity in the accompanying consolidated  
balance sheets.  Unearned compensation is reduced as the related note  
payable is reduced.  ESOP contributions by the Bank charged to  
compensation and benefits expense in 1996 and 1995 were approximately  
$57,000 and $70,000, respectively. 
   
The Company has a stock option plan for directors and selected officers  
and employees.  The exercise price of options granted under the plan is at  
least equal to the fair market value on the date of grant.  At December 31,  
1996, 46,287 shares of common stock have been reserved for issuance  
under the plan.  The options vest over varying periods of time and are  
exercisable for up to ten years.  Information with respect to option activity  
(as adjusted for all stock dividends) is as follows: 
 
<TABLE>
<CAPTION>
                     				                       		Weighted average 
		                              Number of 		        exercise price 
					                           shares 			               per share 
<S>                             <C>                    <C> 
Outstanding at January 1, 1994	  46,287			              $10.00 
Issued					                           0                   			0 
Issued through 5% stock dividend	 1,978                   			0 
Exercised 				                    2,375               			10.00 
Canceled 	 			                    5,322              	 		10.00 

Outstanding at December 31, 1994	40,568		                	9.51 
Issued	                           				0	                   		0 
Issued through 5% stock dividend	 2,018	                   		0 
Exercised 				                       52                			9.51 
Canceled 				                         0                   			0 
Outstanding at December 31, 1995	42,534			                9.06 
 
Issued                       					4,000		                21.00 
Issued through 5% stock dividend	 2,321	                    	0 
Exercised 				                        0                    		0 
Canceled 				                         0                    		0 
Outstanding at December 31, 1996	48,855		                 9.61 
 
Options exercisable at  
December 31, 1996			             37,420                		$8.64 
</TABLE>  

Options outstanding at December 31, 1996 were exercisable at prices  
ranging from $8.64 to $20.00. 
 
Pro forma net earnings and net earnings per share for 1996 and 1995,  
applying the disclosure provisions of SFAS 123, would not be materially  
different than such amounts as reflected in the accompanying consolidated  
statements of earnings. 
 
The Company has adopted a cash incentive program whereby bonuses are  
awarded if certain annual profitability thresholds are achieved. The  
incentive program also allows for discretionary bonuses.  The Company  
recorded bonuses under the incentive programs of approximately $53,000,  
$56,000 and $17,000 in 1996, 1995 and 1994, respectively. 
 
 
(10) Fair Value of Financial Instruments 
 
Fair value estimates of the Company's financial instruments as of  
December 31, 1996 and 1995, including methods and assumptions utilized,  
are set forth below (in thousands): 
 
<TABLE>
<CAPTION> 
                      			1996				                   1995 
	                        Carrying	   Estimated	     Carrying	   Estimated 
	                        amount 	    fair value	    amount		    fair value 
<S>                      <C>         <C>            <C>         <C> 
Investment securities	   $33,238,854	33,280,000	    32,328,951	 32,421,000 
Loans, net of unearned  
fees and allowance for 
 loan losses 		          $62,369,858	60,785,000	    61,883,135	 58,713,000 
Noninterest-bearing  
demand deposits	         $ 5,260,221	 5,260,000	     4,651,830	  4,652,000 
Money market and  
NOW deposits		            28,936,080	28,936,000	    27,121,850	 27,122,000 
Savings deposits	          5,162,275	 5,162,000	     5,908,323	  5,908,000 
Time deposits		           47,351,374	47,493,000	    48,717,440	 48,823,000 
Total deposits		         $86,709,950	86,851,000	    86,399,443	 86,505,000 
 
Other borrowed funds	    $ 3,615,020  3,620,000	     2,880,915	  2,886,000 
</TABLE>

Methods and Assumptions Utilized 
 
The carrying amount of cash and cash equivalents, loans held for sale,  
federal funds sold, accrued interest receivable and payable are considered  
to approximate fair value. 
 
The estimated fair value of investment securities, except certain obligations  
of states and political subdivisions, is based on bid prices published in  
financial newspapers or bid quotations received from securities dealers. 
The fair value of certain obligations of states and political subdivisions is  
not readily available through market sources other than dealer quotations,  
so fair value estimates are based upon quoted market prices of similar  
instruments, adjusted for differences between the quoted instruments and  
the instruments being valued. 
  
The estimated fair value of the Company's loan portfolio is based on the  
segregation of loans by collateral type, interest terms and maturities.  In  
estimating the fair value of each category of loans, the carrying amount of  
the loan is reduced by an allocation of the allowance for loan losses.  Such  
allocation is based on management's loan classification system which is  
designed to measure the credit risk inherent in each classification category. 
The estimated fair value of performing variable rate loans is the carrying  
value of such loans, reduced by an allocation of the allowance for loan  
losses.  The estimated fair value of performing fixed rate loans is calculated  
by discounting scheduled cash flows through the estimated maturity using  
estimated market discount rates that reflect the interest rate risk inherent in 
the loan, reduced by an allocation of the allowance for loan losses.  The  
estimate of maturity is based on the Company's historical experience with  
repayments for each loan classification, modified, as required, by an  
estimate of the effect of current economic and lending conditions.  The fair  
value for significant nonperforming loans is the estimated fair value of the  
underlying collateral based on recent external appraisals or other available  
information, which generally approximates carrying value, reduced by an  
allocation of the allowance for loan losses. 
  
The estimated fair value of deposits with no stated maturity, such as  
noninterest-bearing demand deposits, savings, money market accounts and  
NOW accounts, is equal to the amount payable on demand.  The fair value  
of interest-bearing time deposits is based on the discounted value of  
contractual cash flows of such deposits.  The discount rate is estimated  
using the rates currently offered for deposits of similar remaining  
maturities. 
   
The carrying amount of other borrowed funds (including federal funds  
purchased) approximates fair value because such funds are purchased for  
relatively short periods. 
  
 
Limitations 
  
Fair value estimates are made at a specific point in time, based on relevant  
market information and information about the financial instruments.  These  
estimates do not reflect any premium or discount that could result from  
offering for sale at one time the Company's entire holdings of a particular  
financial instrument.  Because no market exists for a significant portion of  
the Company's financial instruments, fair value estimates are based on  
judgments regarding future loss experience, current economic conditions,  
risk characteristics of various financial instruments and other factors. 
These estimates are subjective in nature and involve uncertainties and  
matters of significant judgment and therefore cannot be determined with  
precision.  Changes in assumptions could significantly affect the estimates. 
Fair value estimates are based on existing balance sheet financial  
instruments without attempting to estimate the value of anticipated future  
business and the value of assets and liabilities that are not considered  
financial instruments. 
 
 
   
(11) Regulatory Capital Requirements 
  
Current regulatory capital regulations require financial institutions to meet  
three different regulatory capital requirements.  Institutions are required to  
have minimum leverage capital equal to 4% of total average assets,  
minimum Tier 1 risk-based capital equal to 4% of total risk-weighted assets  
and total qualifying capital equal to 8% of total risk-weighted assets in  
order to be considered "adequately capitalized."  The following is a  
comparison of the Company's regulatory capital to minimum capital  
requirements at December 31, 1996 (in thousands): 

<TABLE>
<CAPTION>
               	          Leverage	     Tier 1 risk-		     Total risk- 
			                       capital		     based capital		     based capital 
<S>                       <C>           <C>                <C>	 
Bank capital		            $8,956        	8,956			           9,616 
Minimum capital  
requirement	  	            4,043		       2,111			           4,222 
Bank capital in excess  
of minimum capital 
requirement		             $4,913		       6,845			           5,394 
Minimum capital  
requirement-percent	        4.0%		         4.0			             8.0 
Bank capital		              8.7%		        17.0			            18.2 
</TABLE>

(12) Parent Company Condensed Financial Statements 
 
Following is condensed financial information of the Company as of and for  
the years ended December 31, 1996 and 1995: 

<TABLE>
<CAPTION>

Condensed Balance Sheets 
December 31, 1996 and 1995 
 
Assets   			               1996		            1995
<S>                        <C>               <C> 
 
Cash				                   $1,582,283	       1,096,675 
Investment securities		       416,566	         499,933 
Investment in subsidiary 	  9,625,100	       9,566,046 
Other				                      31,972		          5,328 
Total assets			           $11,655,921	      11,167,982 
 
Liabilities and 
Stockholders' Equity		 
 
Borrowed funds		             $315,020	         355,915 
Other				                       6,736		          1,818 
Stockholders' equity		     11,334,165	      10,810,249 
Total liabilities and  
stockholders' equity		    $11,655,921	      11,167,982 
</TABLE>

<TABLE>
<CAPTION>
 
Condensed Statements of Earnings  
Years ended December 31, 1996 and 1995 
 
                             		1996		      1995	    	1994 
<S>                            <C>         <C>       <C> 
Dividends from subsidiary	     $ 650,194	  778,842	  317,109 
Interest income 		                66,749	  	54,897		  70,111 
Other expense, net	            	(115,386)	 (103,082)	(79,102) 
 Interest before equity in 
 undistributed earnings  
of subsidiary			                 601,557	   730,657  	308,118 
 
Increase (decrease) in  
undistributed equity of  
subsidiary 			                   100,485	   (22,405)	  330,833 
Net earnings before income  
taxes				                        702,042	    708,252	  638,951 
 
Income tax benefit		              14,488		    45,154	  	16,000 
Net earnings 			               $ 716,530	    753,406	  654,951 
</TABLE>

<TABLE>
<CAPTION> 
Condensed Statements of Cash Flows 
Years ended December 31, 1996, 1995 and 1994 
 
                             				1996		        1995		        1994
<S>                              <C>           <C>           <C> 
Cash flows from operating 
 activities: 
Net earnings 			                 $ 716,530	     753,406	     654,951 
(Increase) decrease in  
undistributed equity of	 
subsidiary			                     (100,485)	     22,405		   (330,833) 
Other				                          (21,509)	     18,170		    (43,683) 
 
Net cash provided by 
operating activities	  	           594,536	     793,981	     280,435 
 
Cash flows from investing  
activities:	 
Purchase of investment  
securities			                     (867,137)	    (501,110)	           0 
Maturity of investment  
securities			                      950,000	            0		   1,250,000 
Investment in subsidiary	                0		  (1,378,193) 	          0 
Net cash provided by (used in) 
investing activities	 	             82,863		  (1,879,303)	   1,250,000 
Cash flows from financing 
 activities: 
Issuance of 52 common  
shares under the stock option  
plan				                                 0		         520		      23,750 
 Payment of dividends	 	          (191,791)	    (139,018)	    (119,834) 
Net cash used in  
financing activities 	  	         (191,791)	    (138,498)	     (96,084) 
 
Net increase (decrease) in 
 cash				                          485,608	   (1,223,820)	   1,434,351 
 
Cash at beginning of year 	      1,096,675	    2,320,495	      886,144 
Cash at end of year		           $1,582,283	    1,096,675	    2,320,495 
</TABLE>

Dividends paid by the Company are provided through subsidiary Bank  
dividends. At December 31, 1996,  
the Bank could distribute dividends of up to $827,000 without regulatory  
approvals. 
 
Corporate Information 
DIRECTORS OF MNB BANCSHARES, INC. AND SECURITY  
NATIONAL BANK 
Brent A. Bowman, Chairman 
President 
Brent A. Bowman and 
Associates Architects, P.A. 
 
Patrick L. Alexander 
President and Chief Executive Officer 
MNB Bancshares, Inc. and 
Security National Bank 
 
William F. Caton* 
President 
Kansas Development Finance Authority 
 
Rolla W. Goodyear 
President, Auburn Branch 
Security National Bank 
 
Joseph L. Downey 
Senior Consultant and Director 
Dow Chemical Company 
Chairman, DowElanco 
Director, DowBrands, Inc. 
 
Charles D. Green 
Retired Attorney 
Arthur, Green, Arthur, 
Conderman & Stutzman 
 
Vernon C. Larson 
Retired Assistant Provost and 
Director of International Programs 
Kansas State University 
 
Dennis A. Mullin 
President 
Steel and Pipe Supply Co., Inc. 
 
Jerry R. Pettle 
Dentist 
Dental Associates of Manhattan, PA. 
 
Donald J. Wissman 
Chairman, DPRA, Inc. 
President, Grain Industry Alliance 
 
*Bank Director only 
 
EXECUTIVE OFFICERS OFMNB BANCSHARES, INC. 
Patrick L. Alexander 
President and Chief Executive Officer 
 
Susan E. Roepke 
Vice President, Secretary and Treasurer 
 
EXECUTIVE OFFICERS OF SECURITY NATIONAL BANK 
Patrick L. Alexander 
President and Chief Executive Officer 
 
Rolla W. Goodyear 
Auburn Branch President 
 
Susan E. Roepke 
Senior Vice President, Secretary and Cashier 
 
Michael E. Scheopner 
Senior Vice President 
 
Michael R. Toy 
Senior Vice President 
 
Dennis D. Wohler 
Senior Vice President 
 
 
STOCK PRICE INFORMATION 
The Company's common stock trades on The Nasdaq Small-Cap Market  
tier of The Nasdaq Stock Market under the symbol "MNBB". At  
December 31, 1996, the Company had approximately 420 stockholders of  
record. Set forth below are the reported high and low bid prices of the  
common stock and dividends paid during the past two years. Information  
presented below has been restated to give effect to the 5% stock dividends  
paid in 1995. 

<TABLE>
<CAPTION>


1996			         High		   Low		  Dividends 
<S>             <C>      <C>    <C>
First Quarter		 $20.50		 $19.75		$0.0625 
Second Quarter	  20.50 		 20.00 		0.0656 
Third Quarter		  20.00	 	 19.00		 0.0656 
Fourth Quarter		 23.00		  19.00		 0.1250 
 
1995			          
First Quarter 		$17.50		 $17.25		$0.0595 
Second Quarter	  16.75		  16.50	 	0.0595 
Third Quarter		  19.75		  16.75	 	0.0595 
Fourth Quarter		 20.00		  19.50		 0.0595 
</TABLE>
 
CORPORATE HEADQUARTERS 
800 Poyntz Avenue 
Manhattan, Kansas 66502 
 
 
ANNUAL MEETING 
The annual meeting of stockholders will be held at the Kansas State  
University Student Union, Big 12 Conference Room, Manhattan, Kansas  
66506, on Monday, May 19, 1997 at 2:00 PM. 
 
 
FORM 10-K 
A copy of the Annual Report on Form 10-K filed with the Securities and  
Exchange Commission may be obtained by stockholders without charge on  
written request to Patrick L. Alexander, President and Chief Executive  
Officer, MNB Bancshares, Inc., PO Box 308, Manhattan, Kansas 66505- 
0308 
 
 
REGISTRAR AND TRANSFER AGENT 
Boatmen's Trust Company 
Corporate Trust Division 
510 Locust Street 
P.O. Box 14737 
St. Louis, Missouri 63178-4737 
 
 
INDEPENDENT ACCOUNTANTS 
KPMG Peat Marwick LLP 
1000 Walnut, Suite 1600 
Kansas City, Missouri 64199 
 
 
EXHIBIT 21.1 
 
SUBSIDIARIES OF MNB BANCSHARES, INC. 
 
 
	 
	The only subsidiary of the Company is Security National Bank, a  
national banking association with its main office located in Manhattan,  
Kansas, and with a branch office in Auburn, Kansas. 
 
 
 
EXHIBIT 23.1 
CONSENT OF KPMG PEAT MARWICK LLP 
 
The Board of Directors 
MNB Bancshares, Inc. 
 
We consent to incorporation by reference in the registration statement (No.  
33-51710) on Form S-8 of MNB Bancshares, Inc. of our report, dated  
January 31, 1997, relating to the consolidated balance sheets of MNB  
Bancshares, Inc. and subsidiary as of December 31, 1996 and 1995 and the  
related consolidated statements of earnings, stockholders' equity and cash  
flows for each of the years in the three-year period ended December 31,  
1996, which report appears in the December 31, 1996 annual report on  
Form 10-K of MNB Bancshares, Inc. 
 
/s/ KPMG Peat Marwick 
 
Kansas City, Missouri 
March 26, 1997 
 
EXHIBIT 99.1 
PROXY STATEMENT OF THE COMPANY  
FOR THE ANNUAL MEETING OF STOCKHOLDERS 
TO BE HELD MAY 19, 1997 
 
MNB Bancshares, Inc. 
800 Poyntz Avenue 
Manhattan, Kansas  66502 
(913) 565-2000 
 
NOTICE OF 
ANNUAL MEETING OF STOCKHOLDERS 
TO BE HELD MAY 19, 1997 
 
 
 
To the stockholders of 
 
	MNB BANCSHARES, INC. 
 
	The Annual Meeting of the Stockholders of MNB Bancshares, Inc., a 
Delaware  
corporation (the "Company"), will be held at the Kansas State University 
Student Union,  
17th and Anderson Avenue, Manhattan, Kansas, 66506, on Monday, May 19, 
1997, at 2:00 p.m., local time, for the following purposes: 
 
1.	to elect two (2) Class II directors for a term of three years. 
2.	to approve the appointment of KPMG Peat Marwick LLP as 
independent  public accountants for the Company for the fiscal year 
ending December 31, 1997.
3.	to transact such other business as may properly be brought 
before the meeting and any adjournments or postponements thereof. 
 
 
The Board of Directors has fixed the close of business on April 4, 
1997, as the record date for the determination of stockholders entitled 
to notice of, and to vote at, the meeting. 
 
 
By order of the Board of Directors 
/s/Patrick L. Alexander 
President and Chief Executive Officer 
 
Manhattan, Kansas 
April 18, 1997 
 
PROXY STATEMENT 
 
 
This Proxy Statement is furnished in connection with the solicitation by the  
Board  
of Directors of MNB Bancshares, Inc. (the "Company") of proxies to be voted 
at the Annual Meeting of Stockholders to be held at the Kansas State 
University Student Union, 17th and Anderson Avenue, Manhattan, Kansas, 66506, 
on Monday, May 19, 1997, at 2:00 p.m., local time, and at any adjournments or
postponements thereof. 
 
The Board of Directors would like to have all stockholders represented at the  
meeting.  If you do not expect to be present, please sign and mail your proxy  
card in the enclosed self-addressed, stamped envelope to MNB Bancshares, 
Inc., P.O. Box 308, Manhattan, Kansas 66505-0308, Attention:  Mr. Patrick L. 
Alexander.  You have the power to revoke your proxy at any time before it is 
voted, by giving written notice to the Secretary of the Company, provided 
such written notice is received by the Secretary prior to the annual meeting 
or any adjournments or postponements thereof, by  submitting a later  
dated proxy or by attending the annual meeting and choosing to vote in  
person.  The giving of a proxy will not affect your right to vote in person 
if you attend  the meeting. 
 
The Company's principal executive office is located at 800 Poyntz 
Avenue, Manhattan, Kansas and its mailing address is P.O. Box 308, 
Manhattan, Kansas 66505-0308.  This Proxy Statement and the accompanying 
proxy card are being mailed to  
stockholders on or about April 18, 1997.  The 1996 Annual Report of the  
Company,  
which includes consolidated financial statements of the Company and its  
subsidiary, is enclosed. 
 
The Company is the holding company for Security National Bank, 
Manhattan,  
Kansas (the "Bank").  The Bank is the successor-in-interest to Manhattan  
Federal Savings  
and Loan Association, Manhattan, Kansas (the "Association"), which on 
January 5, 1993,  
concurrently converted from a federal mutual savings association to a federal  
stock  
savings association and then to a national bank known at that time as  
Manhattan National  
Bank (the "Conversion").  On April 1, 1995, the Company acquired Auburn  
Security  
Bancshares, Inc., the parent company of The Security State Bank in Auburn,  
Kansas.  On  
December 31, 1995, Manhattan National Bank and Security State Bank were  
consolidated  
to form the Bank.  The Bank is presently the Company's only operating  
subsidiary, and the  
Company's business presently consists solely of the ownership of the Bank.   
The term  
"Bank" as used in this Proxy Statement sometimes refers to the Association  
during the  
time period prior to consummation of the Conversion.   
 
	Only holders of record of the Company's Common Stock at the close 
of business  
on April 4, 1997, will be entitled to vote at the annual meeting or any  
adjournments or  
postponements of such meeting.  On April 4, 1997, the Company had 608,839  
shares of  
Common Stock, par value $0.01 per share, issued and outstanding.  In the  
election of  
directors, and for all other matters to be voted upon at the annual meeting,  
each issued  
and outstanding share is entitled to one vote. 
 
	All shares of Common Stock represented at the annual meeting by 
properly  
executed proxies received prior to or at the annual meeting, and not revoked,  
will be  
voted at the annual meeting in accordance with the instructions thereon.  If  
no instructions  
are indicated, properly executed proxies will be voted for the nominees and 
for
adoption  of the proposals set forth in this Proxy Statement. 
 
A majority of the shares of the Common Stock, present in person or 
represented
by proxy, shall constitute a quorum for purposes of the annual meeting.   
Abstentions and  
broker non-votes will be counted for purposes of determining a quorum.   
Directors shall  
be elected by a plurality of the votes present in person or represented by  
proxy at the  
meeting and entitled to vote.  In all matters other than the election of  
directors, the  
affirmative vote of a majority of shares required to constitute a quorum and  
voting on the  
subject matter shall be required to constitute stockholder approval.   
Abstentions will be  
counted as votes against a proposal and broker non-votes will have no effect 
on the vote. 
 
ELECTION OF DIRECTORS 
 
	At the Annual Meeting of the Stockholders to be held on May 19, 
1997, the  
stockholders will be entitled to elect two (2) Class II directors for a term  
expiring in 2000.   
The directors of the Company are divided into three classes having staggered  
terms of  
three years.  Of the nominees for election as Class II directors, Donald J.  
Wissman is an  
incumbent director and Susan E. Roepke has been newly nominated to fill the  
vacancy  
caused by the retirement of C. Clyde Jones.  Dennis A. Mullin, whose term as 
a Class II  
director expires at the 1997 Annual Meeting, is also retiring from the board at 
that time.   

The Board of Directors has not nominated an individual to replace Mr. Mullin.  
The  
Company has no knowledge that either of the nominees will refuse or be 
unable to serve,  
but if either of the nominees becomes unavailable for election, the holders of  
the proxies  
reserve the right to substitute another person of their choice as a nominee 
when voting at  
the meeting.  Set forth below is information concerning the nominees for  
election and for  
the other persons whose terms of office will continue after the meeting,  
including the age,  
year first elected a director and business experience during the previous five 
years as of  
April 4, 1997.  The two nominees, if elected at the Annual Meeting of  
Stockholders, will  
serve as Class II directors for three year terms expiring in 2000. 
 
NOMINEES 
 
Name	           Age	Position 
                    with the Company 
                    and the Bank	                          Director Since 
CLASS II 
(Term Expires 2000) 
Susan E. Roepke 	57	Director (since 1997) of the Company 		          1997 
				                and the Bank; Vice President, Secretary 
                    and Treasurer (since 1992) of the Company; 
                    and Senior Vice President and Cashier  
                    (since 1993) of the Bank 

Donald J. Wissman	59	Director of the Company and the Bank	          	1994 

CONTINUING DIRECTORS	 
CLASS III 
(Term Expires 1998) 
Brent A. Bowman	47	Chairman of the Board of the Company and 	       	1987 
		                 the Bank			 

Charles D. Green	71	Director of the Company and the Bank	           	1957 
Vernon C. Larson	73	Director of the Company and the Bank	           	1974 

CLASS I 
(Term Expires 1999) 
Patrick L. Alexander	44	President, Chief Executive Officer           1990 
                        and Director of the Company and the Bank
 
Joseph L. Downey	60	    Director of the Company and the Bank         	1996 

Rolla W. Goodyear	39	   President of Auburn Branch since January,     1995 
                        1996; Director of the Company and the Bank
 
Jerry R. Pettle	58	Director of the Company and the Bank	             	1978 
 
All of the Company's directors will hold office for the terms indicated, or  
until their  
earlier death, resignation, removal or disqualification, and until their  
respective successors  
are duly elected and qualified, and all executive officers hold office for a  
term of one year.   
There are no arrangements or understandings between any of the directors,  
executive  
officers or any other person pursuant to which any of the Company's directors  
or  
executive officers have been selected for their respective positions, except  
that the  
Company and the Bank have entered into employment contracts with Messrs.  
Alexander  
and Goodyear.  No director is related to any other director or executive  
officer of the  
Company or the Bank by blood, marriage or adoption, except that Mr. 
Goodyear is the  
brother-in-law of Mr. William F. Caton, who is a director of the Bank. 
 
The business experience of each of the nominees and continuing 
directors for  
the  
past five years is as follows:  
 
	Patrick L. Alexander became President and Chief Executive Officer of 
the  
Association in 1990, and became the President and Chief Executive Officer of  
the  
Company and the Bank on August 28, 1992 and January 5, 1993, 
respectively.   
From  
1986 to 1990, Mr. Alexander served as President of the Kansas State Bank of  
Manhattan,  
Manhattan, Kansas.  Mr. Alexander serves as a member of the Boards of 
Directors 
of the  
Big Lakes Foundation, Inc., the Kansas State University Finance Advisory 
Board, and the  
Kansas Chamber of Commerce and Industry. 
 
	Brent A. Bowman has been President of Brent Bowman and 
Associates Architects,  
P.A., an architectural firm in Manhattan, Kansas, since 1979.  Mr. Bowman 
serves on the  
Manhattan Historic District Review Board, the Board of Directors of the Big 
Lakes  
Foundation, Inc., and is an adjunct professor of Architecture at Kansas State 
University. 
 
	Joseph L. Downey has been a director of Dow Chemical Co. since 
1989 and a  
Dow Senior Consultant since 1995 after having served in a variety of 
executive 
positions  
with that company, including Senior Vice President from 1991 to 1994.   
 
Rolla W. Goodyear was the Chairman of the Board of Auburn Security  
Bancshares, Inc. and President and Chief Executive Officer of Security State 
Bank from  
1983 until its acquisition by the Company in April 1995.  Mr. Goodyear 
presently serves  
as President of the Auburn branch of the Bank.  Mr. Goodyear is also the 
owner of the  
Goodyear Agency, a real estate agency located in Topeka, Kansas. 
 
	Charles D. Green is a former partner in the Manhattan, Kansas law 
firm of 
Arthur,  
Green, Arthur, Conderman & Stutzman from 1950 to July 1, 1993.  Mr. 
Green 
formerly  
served as a director of the Commerce Bank, NA, a wholly-owned subsidiary 
of 
CBI- 
Central Kansas, Inc., which is a wholly owned subsidiary of Commerce 
Bancshares, Inc., Kansas City, Missouri. 
 
	Vernon C. Larson was the Assistant Provost and Director of 
International  
Programs at Kansas State University, Manhattan, Kansas from 1962 until his 
retirement in 1991. 
 
	Jerry R. Pettle is a dentist who has practiced with Dental Associates of 
Manhattan,  
P.A., in Manhattan, Kansas, since 1970.  Dr. Pettle is a member of the Board 
of Directors  
of the Manhattan Medical Center and is an examiner for the Kansas Dental 
Board.  Dr.  
Pettle is also a member of the Friends of the Konza Prairie and is a past 
member of the  
Kansas State University Foundation. 
 
	Susan E. Roepke became Vice President of the Company on August 
28, 1992 and  
Senior Vice President, Secretary and Cashier of the Bank on January 5, 1993.  
She was  
elected Secretary of the Association in 1992 and became Vice President/
Operations  
Division of the Association in 1991, and had been Treasurer of the 
Association since  
1970.  She held these positions with the Association until the Conversion in 
1993. 
 
	Donald J. Wissman is President of the Grain Industry Alliance, having 
been  
appointed to the position in June, 1996.  He serves as the Chairman of DPRA  
Incorporated, an environmental/economic research and consulting firm 
headquartered in  
Manhattan, Kansas.  Dr. Wissman has been with DPRA since 1965, having 
previously  
served as a Senior Vice President and Vice President involved in consulting 
projects  
regarding economic and environmental regulatory issues.  He is a past 
Chairman 
and  
director of the Manhattan Chamber of Commerce and currently serves on the 
Board of  
Directors of the Kansas State University Research Foundation. 
 
Board Committees and Meetings 
 
	Committees of the Board of Directors of the Company include a Stock 
Option  
Committee which administers the Company's Stock Option Plan and an Audit 
Committee.   
The full Board of Directors considers nominations to the Board, and will 
consider  
nominations made by stockholders if such nominations are in writing and 
otherwise  
comply with Section 3.1 of the Company's bylaws.  The Board of Directors of 
the Bank  
has an Executive Committee and a Directors' Loan Committee. 
 
	The Executive Committee consists of Directors Bowman (Chairman), 
Alexander,  
Larson, Roepke, Wissman and Mr. William F. Caton, a director of the Bank.  
The
Executive Committee has authority to perform policy reviews, oversee and 
direct  
compensation and personnel functions, monitor marketing and CRA activities, 
review and  
approve the budget and asset/liability position and undertake other 
organizational issues  
and planning discussions as deemed appropriate.  The committee meets 
monthly 
on a  
regularly scheduled basis and more frequently if necessary.  During 1996 the 
committee met 12 times. 
 
	The Directors' Loan Committee consists of Directors Mullin 
(Chairman),  
Alexander, Downey, Goodyear, Green and Pettle.  The Directors' Loan 
Committee
is  
responsible for policy review and oversight of the loan and investment 
functions.  It has  
the authority to approve loans in excess of the Officers' Loan Committee 
lending authority  
up to legal lending limits, subject to certain exceptions which apply to 
certain levels of  
unsecured and insider loans which must be approved by the entire Board of 
Directors.   
The committee reviews the loan loss reserve for adequacy and reviews in 
detail lending  
and investment activities.  The committee meets monthly on a regularly 
scheduled basis  
and more frequently if necessary.  During 1996 the committee met 13 times. 
 
	The Audit Committee consists of Directors Pettle (Chairman), Larson, 
Mullin,  
Wissman and Mr. William F. Caton, a director of the Bank.  The Audit 
Committee is  
responsible for overseeing the internal and external audit functions.  It 
approves internal  
audit staffing, salaries and programs.  The Internal Auditor reports directly 
to the  
committee on audit and compliance matters.  The committee also reviews and 
approves  
the scope of the annual external audit and consults with the independent 
auditors  
regarding the results of their auditing procedures.  The committee normally 
meets  
quarterly.  During 1996 the committee met three times.   
 
The Stock Option Committee consists of Directors Larson (Chairman) and 
Pettle.   
The Stock Option Committee administers the Stock Option Plan and has the 
authority,  
among other things, to select the employees to whom options will be granted, 
to  
determine the terms of each option, to interpret the provisions of the Stock 
Option Plan  
and to make all determinations that it may deem necessary or advisable for the
administration of the Stock Option Plan.  During 1996 the committee met 
once. 
 
	A total of 12 regularly scheduled and special meetings were held by 
the 
Board of  
Directors of the Company during 1996.  During 1996, all directors attended at 
least 75  
percent of the meetings of the Board and the committees on which they serve, 
with the  
exception of Mr. Wissman, who attended 66 percent of the Executive 
Committee
meetings. 
 
	Directors of the Company receive no fees for attendance at regularly 
scheduled  
meetings of the Board of Directors of the Company and they receive $100 for 
attendance  
at special meetings.  Directors of the Bank receive fees of $400 per month 
plus $100 per  
meeting for attendance at regularly scheduled meetings of the Board of 
Directors of the  
Bank and $100 per month for attendance at regularly scheduled meetings of 
committees,  
except that Messrs. Alexander and Goodyear and Mrs. Roepke do not receive 
additional  
amounts for attendance at committee meetings. 
 
EXECUTIVE COMPENSATION 
 
	The following table sets forth information concerning the 
compensation 
paid or  
granted to the Company's Chief Executive Officer for the past three fiscal 
years.  None of  
the remaining executive officers of the Company or the Bank had an aggregate 
salary and  
bonus which exceeded $100,000. 

<TABLE>
<CAPTION>
 
SUMMARY COMPENSATION TABLE	 
Annual Compensation	 Long Term Compensation Awards 
Name and  
Principal Position	        
                     
                     Year                                 Securities
                     Ended                                Underlying      All Other 
                     December 31,   Salary($)(1) Bonus($) Options/SARs(#) Compensation($)(2)                        
<S>                  <C>            <C>          <C>      <C>             <C>
Patrick L. Alexander  
President and Chief  
Executive Officer	   1996	          $114,993	     $30,473         0        $1,186 
		                   1995            108,648	      18,000	        0         1,114
                     1994            103,474            0         0        10,374
<FN>
<FN1>
(1)   Includes amounts deferred.
<FN2>
(2)   Represents contributions made to the MNB Bancshares, Inc.
Employee Stock Ownership Plan (the "ESOP"), of which the
1995 and 1996 contributions have not yet been determined, and
also includes premium payments for an insurance policy purchased
to fund a supplemental disability and death benefit.  For 1994,
the amount of the contribution to the ESOP was $9,391 and,
for 1994, 1995 and 1996, the amount of the insurance premium 
paid was $983, $1,114, and $1,186.
</FN>
</TABLE>

The following table sets forth certain information concerning the
number and value of stock options at December 31, 1996 held by
the Chief Executive Officer.

<TABLE>
<CAPTION>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR 
AND FY-END OPTION/SAR VALUES 
                                                 Number of Securities Underlying	  Value of Unexercised 
                                                 Unexercised Options/SARs at 		    In-the-Money Options/SARs 
                                                 FY-End (#)				                    at FY-End ($) 
<S>             <C>                 <C>          <C>         <C>                   <C>         <C>           
Name		          Shares Acquired on 	Value 
                Exercise (#)		      Realized ($)	Exercisable	Unexercisable	        Exercisable Unexercisable 
Patrick L 
Alexander       0			                $0		         18,108(1)		  0	                   $278,139			 $0 
<FN>
(1)	Includes options resulting from stock dividends paid by the 
Company. 
</FN>
</TABLE>

	Employment Agreement  In January, 1993 the Company and the Bank 
entered into  
an employment agreement with Patrick L. Alexander.  The employment 
agreement initially  
provided for an initial base salary of $94,605, which may be increased but not
decreased,  
and an initial term of three years, with one year extensions thereafter  
unless the agreement  
has been terminated or the Company or Mr. Alexander has provided a notice 
of  non- 
renewal prior thereto.  Notwithstanding any such notice, the term of the  
agreement will be  
extended to three years upon any change in control of the Company or the  
Bank, as  
defined in the agreement.  The employment agreement will terminate upon the  
death or  
disability of Mr. Alexander, in the event of certain regulatory actions or 
upon notice by  
either the Company or Mr. Alexander, with or without cause.  The 
employment  agreement  
will be suspended in the event of a regulatory suspension of Mr. Alexander's  
employment.   
In the event of termination of Mr. Alexander's employment due to disability  
or without  
cause, the Company will be obligated to pay or to provide to him, as  
applicable, continued  
salary and benefits until the earlier of the expiration of the term of the  
agreement or his  
death.  In the event Mr. Alexander's employment discontinues following a  
change in  
control of the Company or the Bank, the successor to the Company or the 
Bank is  
obligated to make a lump sum payment to him equal to three times his then  
annual salary  
and to continue benefits until the earlier of three years or his death.  For  
purposes of the  
employment agreement, Mr. Alexander's employment will be considered 
terminated  
following a change in control in the event his right to retain his position 
with the Bank or  
to exercise fully the authority, duties and responsibilities of such position  
is changed or  
terminated.  The employment agreement includes a covenant which will limit 
the ability of  
Mr. Alexander to compete with the Bank in an area encompassing a fifty mile  
radius from  
the Bank's main office for a period of one year following the termination  
of his  
employment with the Bank.  The geographic area covered by this provision  
constitutes a portion of the Bank's primary service area. 
 
The Executive Committee has furnished the following report on 
executive  
compensation.  The incorporation by reference of this Proxy Statement into 
any  document  
filed with the Securities and Exchange Commission by the Company shall not 
be  deemed  
to include the report unless the report is specifically stated to be  
incorporated by reference  into such document. 
 
Executive Committee Report on Executive Compensation 
 
The Executive Committee of the Board of Directors of the Bank is 
composed of  
six directors and is responsible for recommendations to the Board of Directors  
of the  
Company for compensation of executive officers of the Bank and the 
Company.   At this  
time no separate salary is paid to the officers of the Company.  In 
determining  
compensation, the following factors are generally taken into consideration: 
 
	1.	The performance of the executive officers in achieving the 
short and long term goals of the Company.   
	2.	Payment of compensation commensurate with the ability and 
expertise of the executive officers. 
 
	3.	Attempt to structure compensation packages so that they are 
competitive with similar companies. 
 
The committee considers the foregoing factors, as well as others, in  
determining  
compensation.  There is no assigned weight given to any of these factors. 
 
	Additionally, the Executive Committee considers various benefits, 
such as the  
ESOP and the Stock Option Plan, together with perquisites in determining  
compensation.   
The committee believes that the benefits provided through the stock based  
plans more  
closely tie the compensation of the officers to the interests of the  
stockholders and provide  
significant additional performance incentives for the officers which directly  
benefit the stockholders through an increase in the stock value.   
 
Annually, the Executive Committee evaluates four primary areas of 
performance in  
determining Mr. Alexander's level of compensation.  These areas are:  long- 
range strategic  
planning and implementation; Company financial performance; Company  
compliance with  
regulatory requirements and relations with regulatory agencies; and  
effectiveness of  
managing relationships with stockholders and the Board of Directors.  When  
evaluating  
the financial performance of the Company, the committee considers  
profitability, asset  
growth and risk management.  The primary evaluation criteria are considered  
to be  
essential to the long-term viability of the Company and are given equal  
weight in the  
evaluation.  Finally, the committee reviews compensation packages of peer  
institutions to  
ensure that Mr. Alexander's compensation is competitive and commensurate 
with his level of performance. 
 
	The 1996 compensation of Mr. Alexander was based upon the factors 
described  
above and his substantial experience and length of service with the  
organization.  During  
1996, Mr. Alexander successfully headed the Company's acquisition program,  
which  
included planning, analysis and contacting a number of financial  
institutions. The  
Executive Committee also considered the continuing additional duties 
required  in  
completing the transition of the Bank from a mutual savings association to a  
stock  
institution. Neither Mr. Alexander nor Mrs. Roepke participated in any  
decisions pertaining to Mr. Alexander's compensation. 
	 
Members of the Executive Committee are: 
 
Brent A. Bowman, Chairman 
Patrick L. Alexander 
Vernon C. Larson 
Susan E. Roepke 
Donald J. Wissman 
William F. Caton 
 
Performance Graph 
 
The incorporation by reference of this Proxy Statement into any document 
filed  
with the Securities and Exchange Commission by the Company shall not be  
deemed to  
include the following performance graph and related information unless the  
graph and  
related information are specifically stated to be incorporated by reference 
into the document. 
 
	The following graph shows a four year comparison of cumulative total 
returns  for  
the Company, the Nasdaq Stock Market (U.S. Companies) and the Nasdaq 
Bank  Stocks  
index.  The Common Stock of the Company was first listed for quotation on 
the  Nasdaq  
National Market System on January 6, 1993.  The initial price of the Company  
Common  
Stock shown in the graph below is based upon the price to the public of $10 
per share in  
the Company's initial public offering on January 5, 1993.  The closing price  
quoted on  
Nasdaq at the close of business on January 6, 1993, was $14.25 per share. 

<TABLE>
<CAPTION>
COMPARISON OF CUMULATIVE TOTAL RETURN* 
ASSUMES $100 INVESTED ON JANUARY 6, 1993 
 
*Total return assumes reinvestment of dividends 
 
                       	1/6/93	12/31/93	12/31/94	12/31/95	12/31/96
<S>                     <C>    <C>      <C>      <C>      <C> 
 MNB Bancshares, Inc.	  $100	  $136	    $172	    $209	    $241 
 Nasdaq Market - U.S.	  $100	  $114	    $111	    $157	    $194 
 Nasdaq Bank Stocks	    $100	  $114	    $113	    $169	    $223 
</TABLE>

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS 
 
	The following table sets forth certain information regarding the 
Company's  
Common Stock beneficially owned on April 1, 1997 with respect to all 
persons known to  
the Company to be the beneficial owner of more than five percent of the  
Company's  
Common Stock, each director and nominee, each executive officer named in 
the Summary  
Compensation Table and all directors and executive officers of the Company 
as a group. 

<TABLE>
<CAPTION>
<S>                            <C>                         <C>
Name of Individual and 
Number of Persons in Group		   Amount and Nature of	      	Percent of  
                           	   Beneficial Ownership(1)     Class
First Save Associates, L.P. 
Second First Save Associates, 
L.P. 
c/o First Manhattan Co. 
437 Madison Avenue 
New York, New York 10022		     47,225 (2)			               7.8%  

MNB Bancshares, Inc. 
Employee Stock Ownership Plan 
800 Poyntz Avenue 
Manhattan, Kansas 66502		      53,054 (3)			               8.7%  

Jack Goldstein 
555 Poyntz Avenue 
Manhattan, Kansas  66502		     42,557 (4)			               7.0%  

Patrick L. Alexander 
2801 Brad Lane 
Manhattan, Kansas  66502		     42,791 (5)			                6.8%  

Mr. Rolla Goodyear 
8840 Hanover 
Auburn, Kansas 66402		         45,643 (6) 			              7.5%  

Susan E. Roepke 
2600 Sumac Drive 
Manhattan, Kansas  66502		      42,211 (7)			              6.9%  

Directors		 
Brent A. Bowman			               2,365 (8)		                  * 
Joseph L. Downey			              2,904	                    			* 
Charles D. Green			             12,784	(8)                		2.1% 
Vernon C. Larson			              4,317	(9)                 			* 
Jerry R. Pettle			               6,995	(8)               			1.1% 
Donald J. Wissman			             1,213	                    			* 
 
All directors and executive officers  
as a group (13 persons)      		187,614 (10)			            29.1%  
	*Less than 1%. 
<FN>
<FN1> 
(1)	The information contained in this column is based upon information  
furnished to the Company by the persons named above and the members of 
the designated  
group.  The nature of beneficial ownership for shares shown in this column is  
sole voting  
and investment power, except as set forth in the footnotes below.  Inclusion 
of shares in  
this table shall not be deemed to be an admission of beneficial ownership of  
such shares.   
Amounts shown include shares issued pursuant to a stock dividend paid by the  
Company in August, 1996.		 
<FN2>
(2)	Pursuant to an Amendment No. 2, dated May 13, 1996, to a Schedule 
13D  
filed by First Manhattan CO., as general partner of First Save Associates,  
L.P. and Second  
First Save Associates, L.P., as increased to reflect shares received as a  
result of a stock  
dividend paid by the Company in August, 1996. 
<FN3> 
(3)	Includes 10,801 shares which have been allocated to participants' 
accounts  
under the Company's ESOP.   
<FN4>
(4)	Pursuant to a Schedule 13D dated November 1 1996.  
<FN5> 
(5)	Includes 2,144 shares held in an IRA of which the power to vote such  
shares is shared with the IRA administrator, 19,075 shares over which voting  
and  
investment power is shared with his spouse, and 1,100 shares over which Mr.  
Alexander  
has sole investment and voting power.  Also includes 18,108 shares presently  
obtainable  
through the exercise of options granted under the Company's Stock Option  
Plan, over  
which shares Mr. Alexander has no voting and sole investment power. 
<FN6> 
(6)	Includes 1,014 shares held by Mr. Goodyear's spouse, over which 
shares  
Mr. Goodyear has no voting or investment power. 
<FN7> 
(7)	Includes 8,721 shares held in an Investment Retirement Account 
("IRA"),  
of which the power to vote such shares is shared with the IRA administrator,  
1,352 shares  
held by her spouse and over which Ms. Roepke has shared voting and 
investment power  
and 6,160 shares presently obtainable through the exercise of options granted  
under the  
Company's Stock Option Plan, over which shares Ms. Roepke has no voting 
and  
sole  
investment power.  
<FN8> 
(8)	Includes an aggregate of 1,208 shares presently obtainable through the  
exercise of options granted under the Company's Stock Option Plan for each  
named  
individual, over which shares each such person has no voting and sole  
investment power.   
<FN9> 
(9)	Includes 4,317 shares held jointly with his spouse and over which Mr.  
Larson has shared voting and investment power. 
<FN10> 
(10)	Includes an aggregate of 37,046 shares presently obtainable through 
the  
exercise of options granted under the Company's Stock Option Plan. 
</FN>
</TABLE> 
	Section 16(a) of the Securities Exchange Act of 1934 requires that the  
Company's  
executive officers, directors and persons who own more than 10% of the  
Company's  
Common Stock file reports of ownership and changes in ownership with the  
Securities and  
Exchange Commission and with the exchange on which the Company's shares 
of Common  
Stock are traded.  Such persons are also required to furnish the Company with  
copies of  
all Section 16(a) forms they file.  Based solely on the Company's review of  
the copies of  
such forms, the Company is not aware that any of its directors, executive  
officers or 10%  
stockholders failed to comply with the filing requirements of Section 16(a)  
during the  
period commencing January 1, 1996 through December 31, 1996, except that 
Form 3 for Joseph L. Downey was inadvertently filed late. 
 
 
TRANSACTIONS WITH MANAGEMENT 
 
Directors and officers of the Company and the Bank and their associates were  
customers of and had transactions with the Company and the Bank during 
1996.   
Additional transactions are expected to take place in the future.  All  
outstanding loans,  
commitments to loan, and certificates of deposit and depository relationships,  
in the  
opinion of management, were made in the ordinary course of business, on  
substantially the  
same terms, including interest rates and collateral, as those prevailing at the 
time for  
comparable transactions with other persons and did not involve more than the  
normal risk  
of collectibility or present other unfavorable features.   
 
 
INDEPENDENT PUBLIC ACCOUNTANTS 
 
	Stockholders will be asked to approve the appointment of KPMG Peat 
Marwick  
LLP as the Company's independent public accountants for the year ending  
December 31,  
1997.  A proposal will be presented at the annual meeting to ratify the  
appointment of  
KPMG Peat Marwick LLP.  If the appointment of KPMG Peat Marwick LLP 
is not  
ratified, the matter of the appointment of independent public accountants  
will be  
considered by the Board of Directors.  Representatives of KPMG Peat 
Marwick  
LLP are  
expected to be present at the meeting and will be given the opportunity to  
make a  
statement if they desire to do so and will be available to respond to  
appropriate questions. 
 
The Board of Directors unanimously recommends a vote FOR this 
appointment. 
 
 
SUBMISSION OF STOCKHOLDER PROPOSALS 
 
	Any proposal which a stockholder of the Company wishes to have 
included in the  
proxy materials of the Company relating to the next annual meeting of  
stockholders of the  
Company, which is scheduled to be held in May 1998, must be received at the  
principal  
executive offices of the Company (MNB Bancshares, Inc., 800 Poyntz 
Avenue,  
Manhattan, Kansas  66502, attention: Mr. Patrick L. Alexander, President) no  
later than  
December 19, 1997, and must otherwise comply with the notice and other  
provisions of the Company's Bylaws. 
 
 
GENERAL 
 
Your proxy is solicited by the Board of Directors and the cost of  
solicitation will  
be paid by the Company.  In addition to the solicitation of proxies by use of  
the mails,  
officers, directors and regular employees of the Company or the Bank, acting  
on the  
Company's behalf, may solicit proxies by telephone, telegraph or personal  
interview.  The  
Company will, at its expense, upon the receipt of a request from brokers and  
other  
custodians, nominees and fiduciaries, forward proxy soliciting material to the  
beneficial  
owners of shares held of record by such persons. 
 
OTHER BUSINESS 
 
	It is not anticipated that any action will be asked of the stockholders 
other than  
that set forth above, but if other matters properly are brought before the  
meeting, the  
persons named in the proxy will vote in accordance with their best judgment. 
 
 
FAILURE TO INDICATE CHOICE 
 
If any stockholder fails to indicate a choice in items (1) or (2) on the  
proxy card,  
the shares of such stockholder shall be voted (FOR) in each instance. 
 
REPORT ON FORM 10-K 
 
THE COMPANY WILL FURNISH WITHOUT CHARGE TO EACH 
PERSON  
REPRESENTING THAT HE OR SHE WAS A BENEFICIAL OWNER OF 
THE  
COMPANY'S COMMON STOCK AS OF THE RECORD DATE FOR THE 
MEETING,  
UPON WRITTEN REQUEST, A COPY OF THE COMPANY'S ANNUAL 
REPORT  
ON FORM 10-K.  SUCH WRITTEN REQUEST SHOULD BE SENT TO 
MR. PATRICK L. ALEXANDER, MNB BANCSHARES, INC., P.O. BOX 308,  
MANHATTAN, KANSAS  66505. 
 
By order of the Board of Directors 
 
/s/ 
Patrick L. Alexander 
President and Chief Executive Officer 
Manhattan, Kansas 
April 18, 1997 
 
ALL STOCKHOLDERS ARE URGED TO SIGN 
AND MAIL THEIR PROXIES PROMPTLY 
 
PROXY FOR COMMON SHARES ON BEHALF OF BOARD OF 
DIRECTORS 
FOR THE ANNUAL MEETING OF THE STOCKHOLDERS OF 
MNB BANCSHARES, INC. TO BE HELD MAY 19, 1997 
 
	The undersigned hereby appoints Patrick L. Alexander and Rolla W. 
Goodyear, or  
either of them acting in the absence of the other, with power of substitution,  
attorneys and  
proxies, for and in the name and place of the undersigned, to vote the number 
of shares of  
Common Stock that the undersigned would be entitled to vote if then 
personally  present at  
the Annual Meeting of the Stockholders of MNB Bancshares, Inc., to be held 
at  the  
Kansas State University Student Union, 17th and Anderson Avenue, 
Manhattan, Kansas  
66506, on Monday, May 19, 1997, at 2:00 p.m., local time, or any  
adjournments or  
postponements thereof, upon the matters set forth in the Notice of Annual  
Meeting and  
Proxy Statement, receipt of which is hereby acknowledged, as follows: 
 
1.	ELECTION OF DIRECTORS: 
FOR all nominees listed below 			WITHHOLD 
AUTHORITY 
(except as marked to the contrary below)		to vote for all nominees 
listed below 
 
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY  
INDIVIDUAL NOMINEE, STRIKE A LINE THROUGH THE 
NOMINEE'S NAME IN  
THE LIST BELOW.) 
 
 
Class II (term expires 2000):  Susan E. Roepke and Donald J. Wissman 
 
 
 
2.	APPROVE THE APPOINTMENT OF KPMG PEAT MARWICK 
LLP AS THE  
COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS FOR THE 
YEAR ENDING  DECEMBER 31, 1997: 

For	Against	Abstain 
 
3.	In accordance with their discretion, upon all other matters that may  
properly come  
before said meeting and any adjournment or postponements thereof. 
 
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN 
THE  
MANNER DIRECTED HEREIN BY THE UNDERSIGNED 
STOCKHOLDER.  IF NO  
DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE 
NOMINEES  LISTED UNDER PROPOSAL 1 AND FOR PROPOSAL 2. 
 
 
 
 
Dated:, 1997 
Signature(s)  
   
 
NOTE:  PLEASE DATE PROXY AND SIGN IT EXACTLY AS NAME OR 
NAMES  
APPEAR ABOVE.  ALL JOINT OWNERS OF SHARES SHOULD SIGN.  
STATE  
FULL TITLE WHEN SIGNING AS EXECUTOR, ADMINISTRATOR, 
TRUSTEE,  
GUARDIAN, ETC.  PLEASE RETURN SIGNED PROXY IN THE 
ENCLOSED  ENVELOPE.