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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2007
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission file number 000-21671
 THE NATIONAL BANK OF INDIANAPOLIS CORPORATION
 (Exact name of Registrant as Specified in its Charter)
 Indiana(State or Other Jurisdiction of 
Incorporation or Organization)
    
    35-1887991(I.R.S. Employer Identification No.)107 North Pennsylvania Street 
Indianapolis, Indiana(Address of Principal Executive Offices)
    
    46204(Zip Code)
 (317) 261-9000  (Registrants Telephone Number, Including Area Code)
 Securities registered pursuant to Section 12(b) of the Act: None
 Securities registered Pursuant to Section 12(g) of the Act: Common Stock
 o þ
 o þ
 þ o
 þ
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o
 o þ




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##### 



Form 10-K Cross Reference Index
 PagePART IItem 1. Business
    
    
    1Item 1A. Risk Factors
    
    
    12Item 1B. Unresolved Staff Comments
    
    
    16Item 2. Properties
    
    
    16Item 3. Legal Proceedings
    
    
    17Item 4. Submission of Matters to a Vote of Security Holders
    
    
    17PART IIItem 5. Market for Registrants Common Equity,
Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    17Item 6. Selected Financial Data
    
    
    20Item 7. Managements Discussion and Analysis of Financial Condition
and Results of Operations
    
    
    21Item 7A. Quantitative and Qualitative Disclosures about Market Risk
    
    
    49Item 8. Financial Statements and Supplementary Data
    
    
    51Item 9. Changes In and Disagreements With Accountants on Accounting
and Financial Disclosure
    
    
    104Item 9A. Controls and Procedures
    
    
    104Item 9B. Other Information
    
    
    105PART IIIItem 10. Directors, Executive Officers and Corporate Governance
    
    
    105Item 11. Executive Compensation
    
    
    105Item 12. Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters
    
    
    105Item 13. Certain Relationships and Related Transactions, and Director Independence
    
    
    105Item 14. Principal Accounting Fees and Services
    
    
    105PART IVItem 15. Exhibits, Financial Statement Schedules
    
    
    106Signatures
    
    
    109Exhibit 21.00Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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PART I
 
 Item 1. Business
 The Corporation
  
    
    84th Street and Ditch Road in northwestern Marion County;
    
    82nd Street and Bash Road in northeastern Marion County;
    
    Chamber of Commerce Building on North Meridian Street;
    
    One America Office Complex in downtown Indianapolis;
    
    49th Street and North Pennsylvania Street in northern Marion County;
    
    Keystone Avenue and East Carmel Drive in Hamilton County;
    
    106th Street and Michigan Road in Hamilton County; and
    
    Smith Valley Road and S.R. 135 in Johnson County.
 th
     1




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Business Plan Overview
    The Market
 Competition
  2




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Employees
 Lending Activity
     3




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REGULATION AND SUPERVISION
  THE CORPORATION
 The Bank Holding Company Act
 Investments, Control, and Activities
   4




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Capital Adequacy Guidelines for Bank Holding Companies
  Tier 1 Capital to Risk-Weighted Assets
    
    
    9.2
    %Total Risk Based Capital to Risk-Weighted Assets
    
    
    10.8
    %Tier 1 Leverage Ratio
    
    
    7.2
    %
 Dividends
 Source of Strength
  5




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THE BANK
 General Regulatory Supervision
  Lending Limits
 Deposit Insurance
 Transactions with Affiliates and Insiders
  6




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
    
    be made on substantially the same terms, including interest rates and
collateral, as those prevailing at the time for comparable transactions with third
parties; and
    
    not involve more than the normal risk of repayment or present other unfavorable
features.
 Dividends
  Branching and Acquisitions
 Community Reinvestment Act
 Capital Regulations
  7




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Tier 1 Capital to Risk-Weighted Assets
    
    
    9.0
    %Total Risk-Based Capital to Risk-Weighted Assets
    
    
    10.6
    %Tier 1 Leverage Ratio
    
    
    7.0
    %
   8




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Check Clearing for the 21st Century Act
 USA Patriot Act
  9




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Sarbanes-Oxley Act of 2002
 Other Regulations
   
    
    Truth-In-Lending Act and state consumer protection laws governing disclosures of
credit terms and prohibiting certain practices with regard to consumer borrowers;
    
    Home Mortgage Disclosure Act of 1975, requiring financial institutions to
provide information to enable the public and public officials to determine whether
a financial institution is fulfilling its obligation to help meet the housing needs
of the community it serves;
    
    Equal Credit Opportunity Act and other fair lending laws, prohibiting
discrimination on the basis of race, creed or other prohibited factors in extending
credit;
    
    Fair Credit Reporting Act of 1978 and Fair and Accurate Credit Transactions Act
of 2003, governing the use and provision of information to credit reporting
agencies;
    
    Fair Debt Collection Practices Act, governing the manner in which consumer debts
may be collected by collection agencies; and rules and regulations of the various
federal agencies charged with the responsibility of implementing such federal laws.
  10




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
    
    Customer Information Security Guidelines. The federal bank regulatory agencies
have adopted final guidelines (the Guidelines) for safeguarding confidential
customer information. The Guidelines require each financial institution, under the
supervision and ongoing oversight of its Board of Directors, to create a
comprehensive written information security program designed to ensure the security
and confidentiality of customer information, protect against any anticipated
threats or hazards to the security or integrity of such information; protect
against unauthorized access to or use of such information that could result in
substantial harm or inconvenience to any customer; and implement response programs
for security breaches.
    
    Electronic Funds Transfer Act and Regulation E. The Electronic Funds Transfer
Act, which is implemented by Regulation E, governs automatic deposits to and
withdrawals from deposit accounts and customers rights and liabilities arising
from the use of automated teller machines and other electronic banking service.
    
    Gramm-Leach-Bliley Act, Fair and Accurate Credit Transactions Act. The
Gramm-Leach-Bliley Act, the Fair and Accurate Credit Transactions Act, and the
implementing regulations govern consumer financial privacy, provide disclosure
requirements and restrict the sharing of certain consumer financial information
with other parties.
  Enforcement Powers
   11




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Effect of Governmental Monetary Policies
 Available Information
  
 Item 1A. Risk Factors
 The Corporation Is Subject To Interest Rate Risk
   12




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The Corporation Is Subject To Lending Risk
  The Corporations Allowance for Loan Losses May Be Insufficient
  The Corporation Operates In A Highly Competitive Industry And Market Area
   13




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
    
    The ability to develop, maintain and build upon long-term customer relationships
based on top quality service, and safe, sound assets.
    
    The ability to expand the Corporations market position.
    
    The scope, relevance and pricing of products and services offered to meet
customer needs and demands.
    
    The rate at which the Corporation introduces new products and services relative
to its competitors.
    
    Customer satisfaction with the Corporations level of service.
    
    Industry and general economic trends.
  The Corporation Is Subject To Extensive Government Regulation And Supervision
   14




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The Corporations Controls And Procedures May Fail Or Be Circumvented
  The Corporation Is Dependent On Certain Key Management And Staff
  The Corporations Information Systems May Experience An Interruption Or Breach In Security
  The Corporation Has Opened New Offices
  The Corporation Continually Encounters Technological Change
   15




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Item 1B. Unresolved Staff Comments
  
 Item 2. Property
  th th
   16




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Item 3. Legal Proceedings
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 PART II
 
 Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
  Price per ShareQuarter
    
    High
    
    
    Low2007
    
    
    2006
    
    
    2007
    
    
    2006First Quarter
    
    $
    48.21
    
    
    $
    41.57
    
    
    $
    47.38
    
    
    $
    38.00Second Quarter
    
    $
    49.87
    
    
    $
    44.00
    
    
    $
    48.67
    
    
    $
    42.90Third Quarter
    
    $
    50.41
    
    
    $
    45.84
    
    
    $
    49.78
    
    
    $
    43.90Fourth Quarter
    
    $
    53.02
    
    
    $
    47.38
    
    
    $
    52.22
    
    
    $
    45.84
  17




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18




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Maximum Number(or ApproximateTotal Number of
    
    
    Dollar Value) ofTotal Number of
    
    
    
    
    
    
    Shares Purchased as
    
    
    Shares that May YetShares Purchased
    
    
    
    
    
    
    Part of Publicly
    
    
    Be Purchased Underduring 4th quarter
    
    
    Average Price Paid
    
    
    Announced Plans or
    
    
    the Plans orPeriod
    
    2007
    
    
    per Share
    
    
    Programs**
    
    
    Programs10/01/07
 10/31/07
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    3,310,19211/01/07
 11/30/07
    
    
    2,000
    
    
    $
    52.22
    
    
    
    2,000
    
    
    $
    3,205,75212/01/07
 12/31/07
    
    
    8,300
    
    
    $
    52.30
    
    
    
    8,300
    
    
    $
    2,771,686Total
    
    
    10,300
    
    
    
    *
    
    
    
    10,300
 *
    
    The weighted average price per share for the period October 2007 through December 2007 was
$52.28**
    
    All shares repurchased by the Corporation in 2007 were completed pursuant to Program One and
Program Two.  19




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Item 6. Selected Financial Data
  Year Ended December 312007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003As Restated
    
    
    As Restated
    
    
    As RestatedConsolidated Operating Data:Interest income
    
    $
    68,880
    
    
    $
    61,375
    
    
    $
    50,847
    
    
    $
    38,524
    
    
    $
    34,560Interest expense
    
    
    35,263
    
    
    
    29,565
    
    
    
    20,906
    
    
    
    12,962
    
    
    
    11,950Net interest income
    
    
    33,617
    
    
    
    31,811
    
    
    
    29,941
    
    
    
    25,561
    
    
    
    22,610Provision for loan losses
    
    
    904
    
    
    
    1,086
    
    
    
    2,085
    
    
    
    1,320
    
    
    
    1,200Net interest
income after provision for loan losses
    
    
    32,713
    
    
    
    30,725
    
    
    
    27,856
    
    
    
    24,241
    
    
    
    21,410Losses on sale of securities, (net)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (84
    )
    
    
    (37
    )Other operating income
    
    
    10,025
    
    
    
    8,360
    
    
    
    7,461
    
    
    
    7,272
    
    
    
    7,422Other operating expenses
    
    
    30,991
    
    
    
    28,598
    
    
    
    25,176
    
    
    
    22,613
    
    
    
    20,418Income before taxes
    
    
    11,747
    
    
    
    10,486
    
    
    
    10,141
    
    
    
    8,816
    
    
    
    8,377Federal and state income tax
    
    
    3,856
    
    
    
    3,501
    
    
    
    3,911
    
    
    
    3,313
    
    
    
    3,213Net income
    
    
    7,891
    
    
    
    6,985
    
    
    
    6,230
    
    
    
    5,503
    
    
    
    5,164Consolidated Balance Sheet Data (at end of period):Total assets
    
    $
    1,163,109
    
    
    $
    1,034,432
    
    
    $
    928,462
    
    
    $
    880,914
    
    
    $
    812,599Total investment securities (including stock in Federal Banks)
    
    
    137,174
    
    
    
    150,137
    
    
    
    157,471
    
    
    
    151,799
    
    
    
    125,247Total loans
    
    
    830,328
    
    
    
    744,538
    
    
    
    684,488
    
    
    
    656,453
    
    
    
    597,063Allowance for loan losses
    
    
    (9,453
    )
    
    
    (8,513
    )
    
    
    (8,346
    )
    
    
    (7,796
    )
    
    
    (8,030
    )Deposits
    
    
    1,004,762
    
    
    
    875,084
    
    
    
    774,316
    
    
    
    693,431
    
    
    
    637,537Shareholders equity
    
    
    68,938
    
    
    
    59,785
    
    
    
    51,583
    
    
    
    46,544
    
    
    
    42,678Weighted basic average shares outstanding
    
    
    2,328
    
    
    
    2,302
    
    
    
    2,299
    
    
    
    2,303
    
    
    
    2,343Per Share Data:Diluted net income per common share (1)
    
    $
    3.27
    
    
    $
    2.90
    
    
    $
    2.61
    
    
    $
    2.30
    
    
    $
    2.08Cash dividends declared
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Book value (2)
    
    
    29.63
    
    
    
    25.88
    
    
    
    22.11
    
    
    
    19.81
    
    
    
    18.14Other Statistics and Operating Data:Return on average assets
    
    
    0.7
    %
    
    
    0.7
    %
    
    
    0.7
    %
    
    
    0.7
    %
    
    
    0.7
    %Return on average equity
    
    
    12.3
    %
    
    
    12.7
    %
    
    
    12.8
    %
    
    
    12.8
    %
    
    
    12.1
    %Net interest margin (3)
    
    
    3.3
    %
    
    
    3.4
    %
    
    
    3.3
    %
    
    
    3.1
    %
    
    
    3.1
    %Average loans to average deposits
    
    
    82.3
    %
    
    
    85.9
    %
    
    
    85.5
    %
    
    
    89.0
    %
    
    
    95.7
    %Allowance for loan losses to loans at end of period
    
    
    1.1
    %
    
    
    1.1
    %
    
    
    1.2
    %
    
    
    1.2
    %
    
    
    1.3
    %Allowance for loan losses to non-performing loans
    
    
    164.1
    %
    
    
    119.0
    %
    
    
    228.8
    %
    
    
    255.1
    %
    
    
    164.8
    %Non-performing loans to loans at end of period
    
    
    0.7
    %
    
    
    1.0
    %
    
    
    0.5
    %
    
    
    0.5
    %
    
    
    0.8
    %Net charge-offs to average loans
    
    
    0.0
    %
    
    
    0.1
    %
    
    
    0.2
    %
    
    
    0.3
    %
    
    
    0.1
    %Number of offices
    
    
    9
    
    
    
    9
    
    
    
    9
    
    
    
    9
    
    
    
    8Number of full and part-time employees
    
    
    228
    
    
    
    221
    
    
    
    211
    
    
    
    196
    
    
    
    180Number of Shareholders of Record
    
    
    676
    
    
    
    639
    
    
    
    601
    
    
    
    632
    
    
    
    645Capital Ratios:Average shareholders equity to average assets
    
    
    5.9
    %
    
    
    5.7
    %
    
    
    5.2
    %
    
    
    5.2
    %
    
    
    5.6
    %Equity to assets
    
    
    5.9
    %
    
    
    5.8
    %
    
    
    5.6
    %
    
    
    5.3
    %
    
    
    5.3
    %Total risk-based capital ratio (Bank only)
    
    
    10.6
    %
    
    
    10.7
    %
    
    
    10.9
    %
    
    
    10.5
    %
    
    
    10.2
    %
 (1)
    
    Based upon weighted average shares outstanding during the period.(2)
    
    Based on Common Stock outstanding at the end of the period.(3)
    
    Net interest income as a percentage of average interest-earning assets.  20




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
 The following discussion and analysis of the Corporation relates to the years ended December 31,
2007, 2006 and 2005 and should be read in conjunction with the Corporations Consolidated Financial
Statements and Notes thereto included elsewhere herein.
 Overview
       21




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Results of Operations
 Year Ended December 31, 2007 Compared to the Year Ended December 31, 2006 and Year Ended December
31, 2006 Compared to the Year Ended December 31, 2005
    Net Interest Income
  Year ended
    
    
    
    
    
    
    
    
    
    
    Year EndedDecember 31,
    
    
    
    
    
    
    
    
    
    
    December 31,2007
    
    
    2006
    
    
    $ Change
    
    
    % Change
    
    
    2006
    
    
    2005
    
    
    $ Change
    
    
    % ChangeInterest income:Interest and fees on loans
    
    $
    57,383
    
    
    $
    52,724
    
    
    $
    4,659
    
    
    
    8.8
    %
    
    $
    52,724
    
    
    $
    43,256
    
    
    $
    9,468
    
    
    
    21.9
    %Interest on investment securities taxable
    
    
    6,777
    
    
    
    4,908
    
    
    
    1,869
    
    
    
    38.1
    %
    
    
    4,908
    
    
    
    5,726
    
    
    
    (818
    )
    
    
    -14.3
    %Interest on
investment securities nontaxable
    
    
    1,817
    
    
    
    1,782
    
    
    
    35
    
    
    
    2.0
    %
    
    
    1,782
    
    
    
    428
    
    
    
    1,354
    
    
    
    316.1
    %Interest on federal funds sold
    
    
    2,492
    
    
    
    1,849
    
    
    
    643
    
    
    
    34.8
    %
    
    
    1,849
    
    
    
    1,291
    
    
    
    558
    
    
    
    43.2
    %Interest on reverse repurchase agreements
    
    
    411
    
    
    
    112
    
    
    
    299
    
    
    
    267.0
    %
    
    
    112
    
    
    
    146
    
    
    
    (34
    )
    
    
    -23.3
    %Total interest income
    
    $
    68,880
    
    
    $
    61,375
    
    
    $
    7,505
    
    
    
    12.2
    %
    
    $
    61,375
    
    
    $
    50,847
    
    
    $
    10,528
    
    
    
    20.7
    %Interest expense:Interest on deposits
    
    $
    30,847
    
    
    $
    24,542
    
    
    $
    6,305
    
    
    
    25.7
    %
    
    $
    24,542
    
    
    $
    16,110
    
    
    $
    8,432
    
    
    
    52.3
    %Interest on repurchase agreements
    
    
    2,078
    
    
    
    2,128
    
    
    
    (50
    )
    
    
    -2.3
    %
    
    
    2,128
    
    
    
    1,528
    
    
    
    600
    
    
    
    39.3
    %Interest on FHLB advances
    
    
    463
    
    
    
    1,028
    
    
    
    (565
    )
    
    
    -55.0
    %
    
    
    1,028
    
    
    
    1,497
    
    
    
    (469
    )
    
    
    -31.3
    %Interest on long term debt
    
    
    1,875
    
    
    
    1,866
    
    
    
    9
    
    
    
    0.5
    %
    
    
    1,866
    
    
    
    1,771
    
    
    
    95
    
    
    
    5.4
    %Total interest expense
    
    $
    35,263
    
    
    $
    29,564
    
    
    $
    5,699
    
    
    
    19.3
    %
    
    $
    29,564
    
    
    $
    20,906
    
    
    $
    8,658
    
    
    
    41.4
    %Net interest income
    
    $
    33,617
    
    
    $
    31,811
    
    
    $
    1,806
    
    
    
    5.7
    %
    
    $
    31,811
    
    
    $
    29,941
    
    
    $
    1,870
    
    
    
    6.2
    %
  22




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Twelve months ended
    
    
    Twelve months ended
    
    
    Twelve months endedDecember 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005Interest
    
    
    Average
    
    
    
    
    
    
    Interest
    
    
    Average
    
    
    
    
    
    
    Interest
    
    
    AverageAverage
    
    
    Income/
    
    
    Rate/
    
    
    Average
    
    
    Income/
    
    
    Rate/
    
    
    Average
    
    
    Income/
    
    
    Rate/Balance
    
    
    Expense
    
    
    Yield
    
    
    Balance
    
    
    Expense
    
    
    Yield
    
    
    Balance
    
    
    Expense
    
    
    YieldAssets:Federal Funds
    
    $
    52,466
    
    
    $
    2,492
    
    
    
    4.75
    %
    
    $
    46,721
    
    
    $
    1,849
    
    
    
    3.96
    %
    
    $
    43,508
    
    
    $
    1,291
    
    
    
    2.97
    %Reverse Repurchase Agreements
    
    
    8,701
    
    
    
    411
    
    
    
    4.72
    %
    
    
    2,488
    
    
    
    112
    
    
    
    4.50
    %
    
    
    5,000
    
    
    
    146
    
    
    
    2.92
    %Non Taxable Investment Securities
    
    
    46,252
    
    
    
    1,817
    
    
    
    3.93
    %
    
    
    45,357
    
    
    
    1,782
    
    
    
    3.93
    %
    
    
    9,776
    
    
    
    428
    
    
    
    4.38
    %Taxable Investments Securities and Overnight Time
    
    
    154,957
    
    
    
    6,777
    
    
    
    4.37
    %
    
    
    130,426
    
    
    
    4,908
    
    
    
    3.76
    %
    
    
    177,195
    
    
    
    5,726
    
    
    
    3.23
    %Loans (gross)
    
    
    768,271
    
    
    
    57,383
    
    
    
    7.47
    %
    
    
    702,160
    
    
    
    52,724
    
    
    
    7.51
    %
    
    
    668,317
    
    
    
    43,256
    
    
    
    6.47
    %Total earning assets
    
    $
    1,030,647
    
    
    $
    68,880
    
    
    
    6.68
    %
    
    $
    927,152
    
    
    $
    61,375
    
    
    
    6.62
    %
    
    $
    903,796
    
    
    $
    50,847
    
    
    
    5.63
    %Non-earning assets
    
    
    57,065
    
    
    
    
    
    
    
    
    
    
    
    45,223
    
    
    
    
    
    
    
    
    
    
    
    42,777Total assets
    
    $
    1,087,712
    
    
    
    
    
    
    
    
    
    
    $
    972,375
    
    
    
    
    
    
    
    
    
    
    $
    946,573Liabilities:Interest bearing DDA
    
    $
    97,908
    
    
    $
    1,632
    
    
    
    1.67
    %
    
    $
    96,306
    
    
    $
    1,522
    
    
    
    1.58
    %
    
    $
    94,578
    
    
    $
    1,076
    
    
    
    1.14
    %Savings
    
    
    481,295
    
    
    
    19,589
    
    
    
    4.07
    %
    
    
    400,975
    
    
    
    16,171
    
    
    
    4.03
    %
    
    
    402,131
    
    
    
    10,891
    
    
    
    2.71
    %CDs under $100,000
    
    
    71,087
    
    
    
    3,378
    
    
    
    4.75
    %
    
    
    62,924
    
    
    
    2,664
    
    
    
    4.23
    %
    
    
    56,876
    
    
    
    1,887
    
    
    
    3.32
    %CDs over $100,000
    
    
    107,030
    
    
    
    5,415
    
    
    
    5.06
    %
    
    
    78,900
    
    
    
    3,549
    
    
    
    4.50
    %
    
    
    54,524
    
    
    
    1,805
    
    
    
    3.31
    %Individual Retirement Accounts
    
    
    17,618
    
    
    
    833
    
    
    
    4.73
    %
    
    
    15,068
    
    
    
    636
    
    
    
    4.22
    %
    
    
    13,277
    
    
    
    451
    
    
    
    3.40
    %Repurchase Agreements
    
    
    54,326
    
    
    
    2,078
    
    
    
    3.83
    %
    
    
    53,683
    
    
    
    2,128
    
    
    
    3.96
    %
    
    
    62,166
    
    
    
    1,528
    
    
    
    2.46
    %FHLB Advances/Other
    
    
    9,318
    
    
    
    463
    
    
    
    4.97
    %
    
    
    20,458
    
    
    
    1,028
    
    
    
    5.02
    %
    
    
    29,170
    
    
    
    1,497
    
    
    
    5.13
    %Subordinated Debt
    
    
    5,000
    
    
    
    393
    
    
    
    7.86
    %
    
    
    5,000
    
    
    
    378
    
    
    
    7.56
    %
    
    
    5,000
    
    
    
    283
    
    
    
    5.66
    %Long Term Debt
    
    
    13,918
    
    
    
    1,482
    
    
    
    10.65
    %
    
    
    13,918
    
    
    
    1,488
    
    
    
    10.69
    %
    
    
    13,918
    
    
    
    1,488
    
    
    
    10.69
    %Total Interest Bearing Liabilities
    
    $
    857,500
    
    
    $
    35,263
    
    
    
    4.11
    %
    
    $
    747,232
    
    
    $
    29,564
    
    
    
    3.96
    %
    
    $
    731,640
    
    
    $
    20,906
    
    
    
    2.86
    %Non-Interest Bearing Liabilities
    
    
    158,882
    
    
    
    
    
    
    
    
    
    
    
    163,465
    
    
    
    
    
    
    
    
    
    
    
    160,713Other Liabilities
    
    
    7,141
    
    
    
    
    
    
    
    
    
    
    
    6,136
    
    
    
    
    
    
    
    
    
    
    
    5,287Total Liabilities
    
    $
    1,023,523
    
    
    
    
    
    
    
    
    
    
    $
    916,833
    
    
    
    
    
    
    
    
    
    
    $
    897,640Equity
    
    
    64,189
    
    
    
    
    
    
    
    
    
    
    
    55,542
    
    
    
    
    
    
    
    
    
    
    
    48,933Total Liabilities & Equity
    
    $
    1,087,712
    
    
    
    
    
    
    
    
    
    
    $
    972,375
    
    
    
    
    
    
    
    
    
    
    $
    946,573Recap:Interest Income
    
    
    
    
    
    $
    68,880
    
    
    
    6.68
    %
    
    
    
    
    
    $
    61,375
    
    
    
    6.62
    %
    
    
    
    
    
    $
    50,847
    
    
    
    5.63
    %Interest Expense
    
    
    
    
    
    
    35,263
    
    
    
    4.11
    %
    
    
    
    
    
    
    29,564
    
    
    
    3.96
    %
    
    
    
    
    
    
    20,906
    
    
    
    2.86
    %Net Interest Income/Spread
    
    
    
    
    
    $
    33,617
    
    
    
    2.57
    %
    
    
    
    
    
    $
    31,811
    
    
    
    2.66
    %
    
    
    
    
    
    $
    29,941
    
    
    
    2.77
    %Contribution of Non-Interest Bearing Funds
    
    
    
    
    
    
    
    
    
    
    0.69
    %
    
    
    
    
    
    
    
    
    
    
    0.77
    %
    
    
    
    
    
    
    
    
    
    
    0.54
    %Net Interest Margin
    
    
    
    
    
    
    
    
    
    
    3.26
    %
    
    
    
    
    
    
    
    
    
    
    3.43
    %
    
    
    
    
    
    
    
    
    
    
    3.31
    %
   24




---



##### Table of Contents



Net Interest Income Changes Due to Volume and Rates (in 000s):
 2007 Changes from 2006
    
    
    2006 Changes from 2005
    
    
    2005 Changes from 2004Net
    
    
    Due to
    
    
    Due to
    
    
    Net
    
    
    Due to
    
    
    Due to
    
    
    Net
    
    
    Due to
    
    
    Due toChange
    
    
    Rate
    
    
    Volume
    
    
    Change
    
    
    Rate
    
    
    Volume
    
    
    Change
    
    
    Rate
    
    
    VolumeInterest earning assets:Federal funds sold
    
    $
    643
    
    
    $
    370
    
    
    $
    273
    
    
    $
    558
    
    
    $
    431
    
    
    $
    127
    
    
    $
    566
    
    
    $
    540
    
    
    $
    26Reverse repurchase agreements
    
    
    299
    
    
    
    6
    
    
    
    293
    
    
    
    (34
    )
    
    
    79
    
    
    
    (113
    )
    
    
    56
    
    
    
    178
    
    
    
    (122
    )Non Taxable Investment Securities
    
    
    35
    
    
    
    (0
    )
    
    
    35
    
    
    
    1,354
    
    
    
    (44
    )
    
    
    1,398
    
    
    
    156
    
    
    
    (31
    )
    
    
    187Taxable Investments Securities and Overnight Time
    
    
    1,869
    
    
    
    796
    
    
    
    1,073
    
    
    
    (818
    )
    
    
    942
    
    
    
    (1,760
    )
    
    
    1,595
    
    
    
    855
    
    
    
    740Loans
    
    
    4,659
    
    
    
    (279
    )
    
    
    4,938
    
    
    
    9,468
    
    
    
    6,927
    
    
    
    2,541
    
    
    
    9,950
    
    
    
    6,311
    
    
    
    3,639TOTAL
    
    $
    7,505
    
    
    $
    893
    
    
    $
    6,612
    
    
    $
    10,528
    
    
    $
    8,335
    
    
    $
    2,193
    
    
    $
    12,323
    
    
    $
    7,853
    
    
    $
    4,470Interest bearing liabilities:Demand deposits
    
    $
    110
    
    
    $
    83
    
    
    $
    27
    
    
    $
    446
    
    
    $
    419
    
    
    $
    27
    
    
    $
    411
    
    
    $
    302
    
    
    $
    109Savings deposits
    
    
    3,418
    
    
    
    149
    
    
    
    3,269
    
    
    
    5,280
    
    
    
    5,327
    
    
    
    (47
    )
    
    
    5,981
    
    
    
    4,131
    
    
    
    1,850CDs under $100,000
    
    
    714
    
    
    
    326
    
    
    
    388
    
    
    
    777
    
    
    
    521
    
    
    
    256
    
    
    
    192
    
    
    
    181
    
    
    
    11CDs over $100,000
    
    
    1,866
    
    
    
    443
    
    
    
    1,423
    
    
    
    1,744
    
    
    
    648
    
    
    
    1,096
    
    
    
    482
    
    
    
    308
    
    
    
    174Individual retirement accounts
    
    
    197
    
    
    
    76
    
    
    
    121
    
    
    
    185
    
    
    
    109
    
    
    
    76
    
    
    
    69
    
    
    
    50
    
    
    
    19Repurchase agreements
    
    
    (50
    )
    
    
    (75
    )
    
    
    25
    
    
    
    600
    
    
    
    936
    
    
    
    (336
    )
    
    
    958
    
    
    
    1,268
    
    
    
    (310
    )FHLB Advances
    
    
    (565
    )
    
    
    (11
    )
    
    
    (554
    )
    
    
    (469
    )
    
    
    (31
    )
    
    
    (438
    )
    
    
    (278
    )
    
    
    (14
    )
    
    
    (264
    )Subordinated Debt
    
    
    15
    
    
    
    15
    
    
    
    
    
    
    
    95
    
    
    
    95
    
    
    
    
    
    
    
    129
    
    
    
    72
    
    
    
    57Long term debt
    
    
    (6
    )
    
    
    (6
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    TOTAL
    
    $
    5,699
    
    
    $
    1,000
    
    
    $
    4,699
    
    
    $
    8,658
    
    
    $
    8,024
    
    
    $
    634
    
    
    $
    7,944
    
    
    $
    6,298
    
    
    $
    1,646Net change in Net Interest Income
    
    $
    1,806
    
    
    $
    (107
    )
    
    $
    1,913
    
    
    $
    1,870
    
    
    $
    311
    
    
    $
    1,559
    
    
    $
    4,379
    
    
    $
    1,555
    
    
    $
    2,824
   25




---



##### Table of Contents



Provision for Loan Losses
   Twelve months endedDecember 31,2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Beginning of Period
    
    $
    8,513,098
    
    
    $
    8,346,390
    
    
    $
    7,795,803
    
    
    $
    8,029,596
    
    
    $
    7,227,000Provision for loan losses
    
    
    904,000
    
    
    
    1,086,000
    
    
    
    2,085,000
    
    
    
    1,320,000
    
    
    
    1,200,000Losses charged to the reserveCommercial
    
    
    228,294
    
    
    
    1,093,579
    
    
    
    1,317,743
    
    
    
    1,133,994
    
    
    
    506,413Commercial Mortgage
    
    
    
    
    
    
    191,292
    
    
    
    
    
    
    
    
    
    
    
    Residential Mortgage
    
    
    600,423
    
    
    
    121,433
    
    
    
    447,182
    
    
    
    280,394
    
    
    
    1,297Consumer
    
    
    49,980
    
    
    
    50,474
    
    
    
    5,070
    
    
    
    132,993
    
    
    
    2,185Credit Cards
    
    
    3,968
    
    
    
    28,463
    
    
    
    50,125
    
    
    
    65,421
    
    
    
    26,922882,665
    
    
    
    1,485,241
    
    
    
    1,820,120
    
    
    
    1,612,802
    
    
    
    536,816RecoveriesCommercial
    
    
    814,250
    
    
    
    412,028
    
    
    
    258,920
    
    
    
    16,247
    
    
    
    121,918Residential Mortgage
    
    
    67,010
    
    
    
    153,888
    
    
    
    26,000
    
    
    
    26,836
    
    
    
    16,438Consumer
    
    
    6,465
    
    
    
    
    
    
    
    787
    
    
    
    12,354
    
    
    
    105Credit Cards
    
    
    30,557
    
    
    
    33
    
    
    
    
    
    
    
    3,572
    
    
    
    950918,282
    
    
    
    565,949
    
    
    
    285,707
    
    
    
    59,009
    
    
    
    139,412End of Period
    
    $
    9,452,715
    
    
    $
    8,513,098
    
    
    $
    8,346,390
    
    
    $
    7,795,803
    
    
    $
    8,029,596Allowance as a % of Loans
    
    
    1.14
    %
    
    
    1.14
    %
    
    
    1.22
    %
    
    
    1.19
    %
    
    
    1.34
    %
  26




---



##### Table of Contents



Other Operating Income
  Years ended
    
    
    
    
    
    
    
    
    
    
    Years endedDecember 31
    
    
    $
    
    
    %
    
    
    December 31
    
    
    $
    
    
    %2007
    
    
    2006
    
    
    Change
    
    
    Change
    
    
    2006
    
    
    2005
    
    
    Change
    
    
    ChangeWealth management
    
    $
    4,547
    
    
    $
    3,716
    
    
    $
    831
    
    
    
    22.4
    %
    
    $
    3,716
    
    
    $
    3,097
    
    
    $
    619
    
    
    
    20.0
    %Service charges and fees on deposit accounts
    
    
    1,818
    
    
    
    1,713
    
    
    
    105
    
    
    
    6.1
    %
    
    
    1,713
    
    
    
    1,834
    
    
    
    (121
    )
    
    
    -6.6
    %Building rental income
    
    
    597
    
    
    
    451
    
    
    
    146
    
    
    
    32.4
    %
    
    
    451
    
    
    
    450
    
    
    
    1
    
    
    
    0.2
    %Mortgage banking income
    
    
    392
    
    
    
    332
    
    
    
    60
    
    
    
    18.1
    %
    
    
    332
    
    
    
    313
    
    
    
    19
    
    
    
    6.1
    %Interchange income
    
    
    869
    
    
    
    793
    
    
    
    76
    
    
    
    9.6
    %
    
    
    793
    
    
    
    671
    
    
    
    122
    
    
    
    18.2
    %Other
    
    
    1,802
    
    
    
    1,355
    
    
    
    447
    
    
    
    33.0
    %
    
    
    1,355
    
    
    
    1,096
    
    
    
    259
    
    
    
    23.6
    %Total operating income
    
    $
    10,025
    
    
    $
    8,360
    
    
    $
    1,665
    
    
    
    19.9
    %
    
    $
    8,360
    
    
    $
    7,461
    
    
    $
    899
    
    
    
    12.0
    %
       27




---



##### Table of Contents



Accounting for Servicing of Financial Assets
    Other Operating Expenses
  Years Ended
    
    
    
    
    
    
    
    
    
    
    Years EndedDecember 31,
    
    
    $
    
    
    %
    
    
    December 31,
    
    
    $
    
    
    %2007
    
    
    2006
    
    
    Change
    
    
    Change
    
    
    2006
    
    
    2005
    
    
    Change
    
    
    ChangeSalaries,
wages and employee benefits
    
    $
    19,098
    
    
    $
    18,011
    
    
    $
    1,087
    
    
    
    6.0
    %
    
    $
    18,011
    
    
    $
    15,284
    
    
    $
    2,727
    
    
    
    17.8
    %Occupancy
    
    
    1,791
    
    
    
    1,735
    
    
    
    56
    
    
    
    3.2
    %
    
    
    1,735
    
    
    
    1,705
    
    
    
    30
    
    
    
    1.8
    %Furniture and equipment
    
    
    1,241
    
    
    
    1,182
    
    
    
    59
    
    
    
    5.0
    %
    
    
    1,182
    
    
    
    898
    
    
    
    284
    
    
    
    31.6
    %Professional services
    
    
    1,800
    
    
    
    1,447
    
    
    
    353
    
    
    
    24.4
    %
    
    
    1,447
    
    
    
    1,425
    
    
    
    22
    
    
    
    1.5
    %Data processing
    
    
    1,775
    
    
    
    1,678
    
    
    
    97
    
    
    
    5.8
    %
    
    
    1,678
    
    
    
    1,572
    
    
    
    106
    
    
    
    6.7
    %Business development
    
    
    1,292
    
    
    
    1,176
    
    
    
    116
    
    
    
    9.8
    %
    
    
    1,176
    
    
    
    1,072
    
    
    
    104
    
    
    
    9.7
    %Other
    
    
    3,994
    
    
    
    3,369
    
    
    
    625
    
    
    
    18.6
    %
    
    
    3,369
    
    
    
    3,220
    
    
    
    149
    
    
    
    4.6
    %Total other operating expenses
    
    $
    30,991
    
    
    $
    28,598
    
    
    $
    2,393
    
    
    
    8.4
    %
    
    $
    28,598
    
    
    $
    25,176
    
    
    $
    3,422
    
    
    
    13.6
    %
   28




---



##### Table of Contents



Accounting for
Nonrefundable Fees and Costs Associated with Originating or Acquiring Loans and Initial Direct
Costs of Leases
        29




---



##### Table of Contents



Tax (Benefit)/Expense
  2007
    
    
    2006
    
    
    2005As Restated
    
    
    As RestatedCurrent tax expense
    
    $
    4,181,281
    
    
    $
    3,826,638
    
    
    $
    4,332,516Deferred tax benefit
    
    
    (325,232
    )
    
    
    (325,702
    )
    
    
    (421,841
    )$
    3,856,049
    
    
    $
    3,500,936
    
    
    $
    3,910,675
   2007
    
    
    2006Deferred tax assets:Allowance for loan losses
    
    $
    3,744,220
    
    
    $
    3,372,038Other
    
    
    1,162,937
    
    
    
    1,551,002Total deferred tax assets
    
    
    4,907,157
    
    
    
    4,923,040Deferred tax liabilities:Mortgage servicing rights
    
    
    (533,937
    )
    
    
    (525,467
    )Other
    
    
    (301,630
    )
    
    
    Total deferred tax liabilities
    
    
    (835,567
    )
    
    
    (525,467
    )Net deferred tax assets
    
    $
    4,071,590
    
    
    $
    4,397,573
 Effects of Inflation
    30




---



##### Table of Contents



Liquidity and Interest Rate Sensitivity
  th
     31




---



##### Table of Contents



32




---



##### Table of Contents



2007
    
    
    2006
    
    
    2005U.S. Treasuries
    
    
    4.81
    %
    
    
    4.33
    %
    
    
    2.40
    %U.S. Government agencies
    
    
    4.25
    %
    
    
    3.50
    %
    
    
    3.09
    %Collateralized mortgage obligations
    
    
    3.50
    %
    
    
    3.44
    %
    
    
    3.42
    %Municipals
    
    
    5.79
    %
    
    
    5.82
    %
    
    
    6.61
    %Other securities
    
    
    4.91
    %
    
    
    5.03
    %
    
    
    3.33
    %
   33




---



##### Table of Contents



Available-for-Sale SecuritiesGross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gain
    
    
    Loss
    
    
    ValueDecember 31, 2007U.S. Treasury securities
    
    $
    1,503,530
    
    
    $
    10,100
    
    
    $
    
    
    
    $
    1,513,630U.S. Government agencies
    
    
    60,000,000
    
    
    
    889,799
    
    
    
    138,400
    
    
    
    60,751,399Collateralized mortgage obligations
    
    
    2,881
    
    
    
    
    
    
    
    
    
    
    
    2,881$
    61,506,411
    
    
    $
    899,899
    
    
    $
    138,400
    
    
    $
    62,267,910December 31, 2006U.S. Treasury securities
    
    $
    1,495,336
    
    
    $
    
    
    
    $
    981
    
    
    $
    1,494,355U.S. Government agencies
    
    
    60,000,000
    
    
    
    
    
    
    
    720,799
    
    
    
    59,279,201Collateralized mortgage obligations
    
    
    16,659
    
    
    
    7
    
    
    
    
    
    
    
    16,666$
    61,511,995
    
    
    $
    7
    
    
    $
    721,780
    
    
    $
    60,790,222December 31, 2005U.S. Treasury securities
    
    $
    1,494,394
    
    
    $
    
    
    
    $
    2,009
    
    
    $
    1,492,385U.S. Government agencies
    
    
    70,000,000
    
    
    
    
    
    
    
    1,525,300
    
    
    
    68,474,700Collateralized mortgage obligations
    
    
    35,052
    
    
    
    
    
    
    
    12
    
    
    
    35,040$
    71,529,446
    
    
    $
    
    
    
    $
    1,527,321
    
    
    $
    70,002,125
 Held-to-Maturity SecuritiesGross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gain
    
    
    Loss
    
    
    ValueDecember 31, 2007Municipals
    
    $
    46,256,605
    
    
    $
    553,799
    
    
    $
    11,623
    
    
    $
    46,798,781Collateralized mortgage obligations
    
    
    25,299,307
    
    
    
    
    
    
    
    262,570
    
    
    
    25,036,737Other securities
    
    
    200,000
    
    
    
    
    
    
    
    596
    
    
    
    199,404$
    71,755,912
    
    
    $
    553,799
    
    
    $
    274,789
    
    
    $
    72,034,922December 31, 2006Municipals
    
    $
    46,247,490
    
    
    $
    247,212
    
    
    $
    211,345
    
    
    $
    46,283,357Collateralized mortgage obligations
    
    
    39,724,743
    
    
    
    
    
    
    
    952,366
    
    
    
    38,772,377Other securities
    
    
    225,000
    
    
    
    1,182
    
    
    
    2,325
    
    
    
    223,857$
    86,197,233
    
    
    $
    248,394
    
    
    $
    1,166,036
    
    
    $
    85,279,591December 31, 2005Municipals
    
    $
    35,715,981
    
    
    $
    315,262
    
    
    $
    582,213
    
    
    $
    35,449,030Collateralized mortgage obligations
    
    
    47,791,685
    
    
    $
    
    
    
    
    1,400,263
    
    
    
    46,391,422Other securities
    
    
    225,000
    
    
    $
    2,202
    
    
    
    1,598
    
    
    
    225,604$
    83,732,666
    
    
    $
    317,464
    
    
    $
    1,984,074
    
    
    $
    82,066,056
  34




---



##### Table of Contents



35




---



##### Table of Contents



December 31,2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % ofAmount
    
    
    Total
    
    
    Amount
    
    
    Total
    
    
    Amount
    
    
    Total
    
    
    Amount
    
    
    Total
    
    
    Amount
    
    
    TotalTYPES OF LOANSCommercial
    
    $
    279,109
    
    
    
    33.6
    %
    
    $
    253,745
    
    
    
    33.9
    %
    
    $
    234,216
    
    
    
    34.3
    %
    
    $
    221,882
    
    
    
    33.6
    %
    
    $
    212,698
    
    
    
    35.6
    %Construction
    
    
    82,581
    
    
    
    9.9
    %
    
    
    57,083
    
    
    
    7.7
    %
    
    
    50,173
    
    
    
    7.3
    %
    
    
    37,119
    
    
    
    5.7
    %
    
    
    35,305
    
    
    
    5.9
    %Commercial Mortgage
    
    
    175,027
    
    
    
    21.1
    %
    
    
    164,256
    
    
    
    22.1
    %
    
    
    156,108
    
    
    
    22.8
    %
    
    
    141,596
    
    
    
    21.6
    %
    
    
    129,283
    
    
    
    21.7
    %Residential Mortgage
    
    
    243,015
    
    
    
    29.3
    %
    
    
    217,170
    
    
    
    29.2
    %
    
    
    196,045
    
    
    
    28.6
    %
    
    
    206,599
    
    
    
    31.5
    %
    
    
    183,095
    
    
    
    30.7
    %Consumer
    
    
    47,550
    
    
    
    5.7
    %
    
    
    49,575
    
    
    
    6.7
    %
    
    
    45,188
    
    
    
    6.6
    %
    
    
    40,534
    
    
    
    6.2
    %
    
    
    25,183
    
    
    
    4.2
    %Credit Cards
    
    
    3,046
    
    
    
    0.4
    %
    
    
    2,709
    
    
    
    0.4
    %
    
    
    2,737
    
    
    
    0.4
    %
    
    
    2,480
    
    
    
    0.4
    %
    
    
    2,360
    
    
    
    0.4
    %Other
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    20
    
    
    
    0.0
    %
    
    
    6,243
    
    
    
    1.0
    %
    
    
    9,139
    
    
    
    1.5
    %Total  Gross
    
    $
    830,328
    
    
    
    100.0
    %
    
    $
    744,538
    
    
    
    100.0
    %
    
    $
    684,487
    
    
    
    100.0
    %
    
    $
    656,453
    
    
    
    100.0
    %
    
    $
    597,063
    
    
    
    100.0
    %Allowance
    
    
    (9,453
    )
    
    
    
    
    
    
    (8,513
    )
    
    
    
    
    
    
    (8,346
    )
    
    
    
    
    
    
    (7,796
    )
    
    
    
    
    
    
    (8,030
    )Total  Net
    
    $
    820,875
    
    
    
    
    
    
    $
    736,025
    
    
    
    
    
    
    $
    676,141
    
    
    
    
    
    
    $
    648,657
    
    
    
    
    
    
    $
    589,033
  36




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##### Table of Contents



December 31,2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Type
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %Agriculture, Foresty & Fishing
    
    $
    307
    
    
    
    0.1
    %
    
    $
    355
    
    
    
    0.1
    %
    
    $
    1,136
    
    
    
    0.5
    %
    
    $
    258
    
    
    
    0.1
    %
    
    $
    1,297
    
    
    
    0.6
    %Mining
    
    
    5,136
    
    
    
    1.8
    %
    
    
    5,123
    
    
    
    2.0
    %
    
    
    2,574
    
    
    
    1.1
    %
    
    
    2,615
    
    
    
    1.2
    %
    
    
    1,939
    
    
    
    0.9
    %Utilities
    
    
    28
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %Construction
    
    
    10,885
    
    
    
    3.9
    %
    
    
    9,367
    
    
    
    3.7
    %
    
    
    9,527
    
    
    
    4.1
    %
    
    
    13,417
    
    
    
    6.1
    %
    
    
    17,480
    
    
    
    8.2
    %Manufacturing
    
    
    43,067
    
    
    
    15.4
    %
    
    
    46,982
    
    
    
    18.5
    %
    
    
    37,988
    
    
    
    16.2
    %
    
    
    30,371
    
    
    
    13.7
    %
    
    
    18,787
    
    
    
    8.8
    %Wholesale Trade
    
    
    40,889
    
    
    
    14.6
    %
    
    
    30,421
    
    
    
    12.0
    %
    
    
    30,850
    
    
    
    13.2
    %
    
    
    28,380
    
    
    
    12.8
    %
    
    
    25,078
    
    
    
    11.8
    %Retail Trade
    
    
    7,257
    
    
    
    2.6
    %
    
    
    7,090
    
    
    
    2.8
    %
    
    
    4,330
    
    
    
    1.9
    %
    
    
    2,599
    
    
    
    1.2
    %
    
    
    3,755
    
    
    
    1.8
    %Transportation
    
    
    16,635
    
    
    
    6.0
    %
    
    
    9,617
    
    
    
    3.8
    %
    
    
    7,793
    
    
    
    3.3
    %
    
    
    9,280
    
    
    
    4.2
    %
    
    
    5,423
    
    
    
    2.6
    %Information
    
    
    140
    
    
    
    0.0
    %
    
    
    606
    
    
    
    0.2
    %
    
    
    945
    
    
    
    0.4
    %
    
    
    1,141
    
    
    
    0.5
    %
    
    
    1,348
    
    
    
    0.6
    %Finance & Insurance
    
    
    6,866
    
    
    
    2.5
    %
    
    
    5,050
    
    
    
    2.0
    %
    
    
    3,845
    
    
    
    1.6
    %
    
    
    3,934
    
    
    
    1.8
    %
    
    
    5,904
    
    
    
    2.8
    %Real Estate and Rental & Leasing
    
    
    44,657
    
    
    
    16.0
    %
    
    
    52,833
    
    
    
    20.8
    %
    
    
    47,627
    
    
    
    20.2
    %
    
    
    41,241
    
    
    
    18.4
    %
    
    
    37,874
    
    
    
    17.7
    %Professional, Scientific & Technical Services
    
    
    37,345
    
    
    
    13.4
    %
    
    
    30,146
    
    
    
    11.9
    %
    
    
    31,565
    
    
    
    13.5
    %
    
    
    30,726
    
    
    
    13.9
    %
    
    
    33,944
    
    
    
    16.0
    %Management of Companies & Enterprises
    
    
    2,652
    
    
    
    1.0
    %
    
    
    3,928
    
    
    
    1.6
    %
    
    
    1,576
    
    
    
    0.7
    %
    
    
    2,199
    
    
    
    1.0
    %
    
    
    
    
    
    
    0.0
    %Administrative and Support, Waste Management &
Remediation Services
    
    
    2,428
    
    
    
    0.9
    %
    
    
    2,453
    
    
    
    1.0
    %
    
    
    1,476
    
    
    
    0.6
    %
    
    
    
    
    
    
    0.0
    %
    
    
    1,180
    
    
    
    0.6
    %Educational Services
    
    
    4,270
    
    
    
    1.5
    %
    
    
    5,160
    
    
    
    2.0
    %
    
    
    4,384
    
    
    
    1.9
    %
    
    
    4,158
    
    
    
    1.9
    %
    
    
    2,760
    
    
    
    1.3
    %Health Care & Social Assistance
    
    
    26,264
    
    
    
    9.4
    %
    
    
    25,160
    
    
    
    9.9
    %
    
    
    19,494
    
    
    
    8.3
    %
    
    
    20,548
    
    
    
    9.3
    %
    
    
    19,442
    
    
    
    9.1
    %Arts, Entertainment & Recreation
    
    
    2,093
    
    
    
    0.8
    %
    
    
    1,678
    
    
    
    0.7
    %
    
    
    1,759
    
    
    
    0.8
    %
    
    
    5,333
    
    
    
    2.4
    %
    
    
    1,628
    
    
    
    0.8
    %Accommodation & Food Services
    
    
    3,908
    
    
    
    1.4
    %
    
    
    6,777
    
    
    
    2.7
    %
    
    
    6,842
    
    
    
    2.9
    %
    
    
    6,956
    
    
    
    3.1
    %
    
    
    8,562
    
    
    
    4.0
    %Other Services
    
    
    24,282
    
    
    
    8.7
    %
    
    
    10,999
    
    
    
    4.3
    %
    
    
    20,505
    
    
    
    8.8
    %
    
    
    18,726
    
    
    
    8.4
    %
    
    
    26,297
    
    
    
    12.4
    %$
    279,109
    
    
    
    100.0
    %
    
    $
    253,745
    
    
    
    100.0
    %
    
    $
    234,216
    
    
    
    100.0
    %
    
    $
    221,882
    
    
    
    100.0
    %
    
    $
    212,698
    
    
    
    100.0
    %
  December 31,2007
    
    
    2006
    
    
    2005% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % ofAmount
    
    
    Total
    
    
    Amount
    
    
    Total
    
    
    Amount
    
    
    TotalTYPES OF DEPOSITSDemand
    
    $
    180,590
    
    
    
    22.30
    %
    
    $
    181,954
    
    
    
    26.47
    %
    
    $
    171,858
    
    
    
    26.98
    %MMDA/Savings
    
    
    629,342
    
    
    
    77.70
    %
    
    
    505,314
    
    
    
    73.53
    %
    
    
    465,220
    
    
    
    73.02
    %Total Demand Deposits
    
    
    809,932
    
    
    
    100.00
    %
    
    
    687,268
    
    
    
    100.00
    %
    
    
    637,078
    
    
    
    100.00
    %CDs < $100,000
    
    
    71,503
    
    
    
    36.70
    %
    
    
    67,582
    
    
    
    35.98
    %
    
    
    59,258
    
    
    
    43.18
    %CDs > $100,000
    
    
    104,238
    
    
    
    53.50
    %
    
    
    103,782
    
    
    
    55.26
    %
    
    
    64,021
    
    
    
    46.65
    %Individual Retirement Accounts
    
    
    19,089
    
    
    
    9.80
    %
    
    
    16,452
    
    
    
    8.76
    %
    
    
    13,959
    
    
    
    10.17
    %Total Certificates of Deposit
    
    
    194,830
    
    
    
    100.00
    %
    
    
    187,816
    
    
    
    100.00
    %
    
    
    137,238
    
    
    
    100.00
    %Total Deposits
    
    $
    1,004,762
    
    
    
    
    
    
    $
    875,084
    
    
    
    
    
    
    $
    774,316
  37




---



##### Table of Contents



0 - 180
    
    
    181 - 365
    
    
    1 - 2
    
    
    2 - 3
    
    
    3 -5
    
    
    5 +
    
    
    Non-interestdays
    
    
    days
    
    
    years
    
    
    years
    
    
    years
    
    
    years
    
    
    Earning
    
    
    TotalInterest Earning Assets:Fed Funds/ Overnight Time
    
    $
    45,305,810
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    45,305,810Reverse repurchase agreements
    
    
    81,000,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    81,000,000Investments
    
    
    27,282,791
    
    
    
    8,571,376
    
    
    
    48,877,576
    
    
    
    4,638,819
    
    
    
    2,728,587
    
    
    
    41,924,674
    
    
    
    
    
    
    
    134,023,823Federal reserve and FHLB stock
    
    
    2,188,400
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    961,500
    
    
    
    
    
    
    
    3,149,900LoansCommercial & IndustrialFixed
    
    
    16,653,127
    
    
    
    6,394,890
    
    
    
    9,910,449
    
    
    
    10,758,144
    
    
    
    24,305,054
    
    
    
    11,670,872
    
    
    
    
    
    
    
    79,692,536Variable
    
    
    196,252,542
    
    
    
    250,938
    
    
    
    1,227,150
    
    
    
    1,021,070
    
    
    
    256,768
    
    
    
    
    
    
    
    408,366
    
    
    
    199,416,834Construction
    
    
    58,240,329
    
    
    
    1,944,318
    
    
    
    7,532
    
    
    
    8,133
    
    
    
    242,358
    
    
    
    775,523
    
    
    
    1,466,420
    
    
    
    62,684,613Commercial Loans Secured by Real EstateFixed
    
    
    6,144,075
    
    
    
    6,711,047
    
    
    
    20,903,659
    
    
    
    27,283,283
    
    
    
    42,905,367
    
    
    
    17,155,797
    
    
    
    
    
    
    
    121,103,228Variable
    
    
    39,003,619
    
    
    
    171,863
    
    
    
    1,656,839
    
    
    
    4,791,872
    
    
    
    6,275,141
    
    
    
    
    
    
    
    2,024,705
    
    
    
    53,924,039Residential Loans Secured by Real EstateFixed
    
    
    30,744,028
    
    
    
    25,602,980
    
    
    
    31,316,655
    
    
    
    21,053,158
    
    
    
    18,615,327
    
    
    
    5,569,963
    
    
    
    95,561
    
    
    
    132,997,672Variable
    
    
    100,966,547
    
    
    
    7,112,684
    
    
    
    6,850,751
    
    
    
    4,790,727
    
    
    
    7,236,228
    
    
    
    1,202,343
    
    
    
    1,754,869
    
    
    
    129,914,149OtherFixed
    
    
    1,358,835
    
    
    
    1,111,186
    
    
    
    2,075,713
    
    
    
    1,729,946
    
    
    
    3,165,030
    
    
    
    43,390
    
    
    
    5,037,258
    
    
    
    14,521,358Variable
    
    
    36,061,820
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,076
    
    
    
    36,073,896Total Interest Earning Assets
    
    $
    641,201,923
    
    
    $
    57,871,282
    
    
    $
    122,826,324
    
    
    $
    76,075,152
    
    
    $
    105,729,860
    
    
    $
    79,304,062
    
    
    $
    10,799,255
    
    
    $
    1,093,807,858Non-Interest Earning Assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    69,301,199
    
    
    
    69,301,199Total Assets
    
    $
    641,201,923
    
    
    $
    57,871,282
    
    
    $
    122,826,324
    
    
    $
    76,075,152
    
    
    $
    105,729,860
    
    
    $
    79,304,062
    
    
    $
    80,100,454
    
    
    $
    1,163,109,057Interest Bearing Liabilities:Demand Deposits
    
    $
    10,724,537
    
    
    $
    9,955,534
    
    
    $
    18,197,373
    
    
    $
    16,129,876
    
    
    $
    26,970,169
    
    
    $
    98,362,148
    
    
    $
    250,658
    
    
    $
    180,590,295Interest Bearing Demand
    
    
    117,709,143
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    117,709,143Savings Deposits
    
    
    12,008,357
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,008,357Money Market Accounts
    
    
    499,624,440
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    499,624,440Certificate of Deposits
    
    
    44,672,304
    
    
    
    26,604,255
    
    
    
    6,465,050
    
    
    
    2,428,176
    
    
    
    1,850,806
    
    
    
    2,907,514
    
    
    
    
    
    
    
    84,928,105Jumbo CDs
    
    
    67,056,780
    
    
    
    29,784,799
    
    
    
    5,894,225
    
    
    
    3,064,199
    
    
    
    2,409,106
    
    
    
    1,692,580
    
    
    
    
    
    
    
    109,901,689Repurchase Agreements
    
    
    58,475,789
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    58,475,789FHLB Advances
    
    
    
    
    
    
    3,000,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,000,000Subordinated Debt
    
    
    5,000,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,000,000Company obligated mandatorily redeemable
preferred capital securities of subsidiary
trust holding solely the junior subordinated
debentures of the parent company
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,918,000
    
    
    
    
    
    
    
    13,918,000Total Interest Bearing Liabilities
    
    $
    815,271,350
    
    
    $
    69,344,588
    
    
    $
    30,556,648
    
    
    $
    21,622,251
    
    
    $
    31,230,081
    
    
    $
    116,880,242
    
    
    $
    250,658
    
    
    $
    1,085,155,818Non-Interest Bearing Liabilities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,015,233
    
    
    
    9,015,233Equity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    68,938,006
    
    
    
    68,938,006Total Liabilities & Shareholders Equity
    
    $
    815,271,350
    
    
    $
    69,344,588
    
    
    $
    30,556,648
    
    
    $
    21,622,251
    
    
    $
    31,230,081
    
    
    $
    116,880,242
    
    
    $
    78,203,897
    
    
    $
    1,163,109,057Interest Sensitivy Gap per Period
    
    $
    (174,069,427
    )
    
    $
    (11,473,306
    )
    
    $
    92,269,676
    
    
    $
    54,452,901
    
    
    $
    74,499,779
    
    
    $
    (37,576,180
    )
    
    $
    1,896,557Cumulative Interest Sensitivity Gap
    
    $
    (174,069,427
    )
    
    $
    (185,542,733
    )
    
    $
    (93,273,057
    )
    
    $
    (38,820,156
    )
    
    $
    35,679,623
    
    
    $
    (1,896,557
    )
    
    $
    0Interest Sensitivity Gap as a Percentage
of Earning Assets
    
    
    -15.91
    %
    
    
    -1.05
    %
    
    
    8.44
    %
    
    
    4.98
    %
    
    
    6.81
    %
    
    
    -3.44
    %
    
    
    0.17
    %Cumulative Sensitivity Gap as a
Percentage of Earning Assets
    
    
    -15.91
    %
    
    
    -16.96
    %
    
    
    -8.53
    %
    
    
    -3.55
    %
    
    
    3.26
    %
    
    
    -0.17
    %
    
    
    0.00
    %
   38




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##### Table of Contents



Contractual Obligations
  Payments Due InOne toNote
    
    
    One Year or
    
    
    Three
    
    
    Three to(In Thousands)
    
    Reference
    
    
    Less
    
    
    Years
    
    
    Five Years
    
    
    Over Five Years
    
    
    TotalDeposits without a stated maturity(a)
    
    
    11
    
    
    $
    809,932
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    809,932Consumer certificates of deposits (a)
    
    
    11
    
    
    
    168,117
    
    
    
    17,852
    
    
    
    4,260
    
    
    
    4,601
    
    
    
    194,830FHLB Advances(a)
    
    
    12
    
    
    
    3,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,000Security repurchase agreements(a)
    
    
    12
    
    
    
    58,476
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    58,476Long-term debt (a)
    
    
    5, 12
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18,918
    
    
    
    18,918Operating leases
    
    
    9
    
    
    
    301
    
    
    
    605
    
    
    
    412
    
    
    
    1,416
    
    
    
    2,734
   Critical Accounting Policies
    39




---



##### Table of Contents



Mortgage Servicing Assets
  Accounting for Servicing
of Financial Assets
  Derivative Instruments and Hedging Activities
 Accounting for Derivative Instruments and Hedging
Activities
   40




---



##### Table of Contents



Stock-Based Compensation
 Accounting for Stock Issued
to Employees
 Share-Based Payment Accounting for Stock-Based Compensation Accounting for Stock-Based
Compensation  Transition and Disclosure
  41




---



##### Table of Contents



2005As RestatedNet income, as reported
    
    $
    6,230,167Add: stock-based compensation expense, net of related taxes
    
    
    155,340Less: total stock-based compensation expense determined under
fair-value-based method, net of taxes
    
    
    (286,764
    )Pro forma net income
    
    $
    6,098,743Earnings per share:Basic, as reported
    
    $
    2.71Basic, pro forma
    
    $
    2.65Diluted, as reported
    
    $
    2.61Diluted, pro forma
    
    $
    2.55
  Allowance for Loan Losses
  Selected Loan Loss Allowance Methodology and
Documentation Issues Accounting for Contingencies Accounting by Creditors for Impairment of a Loan Accounting by Creditors for Impairment of a Loan  Income Recognition and
Disclosures
   42




---



##### Table of Contents



December 31,2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Commercial
    
    $
    3,422
    
    
    $
    3,870
    
    
    $
    4,204
    
    
    $
    5,094
    
    
    $
    6,519Construction
    
    
    1,381
    
    
    
    448
    
    
    
    404
    
    
    
    155
    
    
    
    77Commercial Mortgage
    
    
    1,724
    
    
    
    1,529
    
    
    
    1,319
    
    
    
    618
    
    
    
    261Residential Mortgage
    
    
    2,445
    
    
    
    2,165
    
    
    
    1,758
    
    
    
    1,108
    
    
    
    639Consumer
    
    
    400
    
    
    
    410
    
    
    
    586
    
    
    
    745
    
    
    
    318Credit Card
    
    
    74
    
    
    
    73
    
    
    
    74
    
    
    
    11
    
    
    
    63Other
    
    
    7
    
    
    
    18
    
    
    
    1
    
    
    
    65
    
    
    
    153$
    9,453
    
    
    $
    8,513
    
    
    $
    8,346
    
    
    $
    7,796
    
    
    $
    8,030
   43




---



##### Table of Contents



December 31,2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % ofAmount
    
    
    Total
    
    
    Amount
    
    
    Total
    
    
    Amount
    
    
    Total
    
    
    Amount
    
    
    Total
    
    
    Amount
    
    
    TotalNon-Accrual LoansCommercial
    
    $
    316
    
    
    
    5.5
    %
    
    $
    4,754
    
    
    
    66.5
    %
    
    $
    1,055
    
    
    
    28.9
    %
    
    $
    1,800
    
    
    
    57.7
    %
    
    $
    4,063
    
    
    
    83.4
    %Construction
    
    
    1,466
    
    
    
    25.4
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %Commercial Mortgage
    
    
    2,025
    
    
    
    35.2
    %
    
    
    1,220
    
    
    
    17.1
    %
    
    
    629
    
    
    
    17.2
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %Residential Mortgage
    
    
    1,851
    
    
    
    32.1
    %
    
    
    1,039
    
    
    
    14.5
    %
    
    
    1,777
    
    
    
    48.8
    %
    
    
    815
    
    
    
    26.1
    %
    
    
    808
    
    
    
    16.6
    %Consumer
    
    
    104
    
    
    
    1.8
    %
    
    
    139
    
    
    
    1.9
    %
    
    
    187
    
    
    
    5.1
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %Credit Card
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %Other
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    504
    
    
    
    16.2
    %
    
    
    
    
    
    
    0.0
    %Total
    
    $
    5,762
    
    
    
    100.0
    %
    
    $
    7,152
    
    
    
    100.0
    %
    
    $
    3,648
    
    
    
    100.0
    %
    
    $
    3,119
    
    
    
    100.0
    %
    
    $
    4,871
    
    
    
    100.0
    %Loans 90 Days Past Due -

Still Accruing
    
    $
    27
    
    
    
    
    
    
    $
    33
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    73
    
    
    
    
    
    
    $
    517Restructured due to troubled
conditions of the borrower
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
  44




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##### Table of Contents



2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Loan TypeCommercial# of loans
    
    
    7
    
    
    
    10
    
    
    
    15
    
    
    
    14
    
    
    
    28Interest income recognized
    
    $
    85,210
    
    
    $
    206,131
    
    
    $
    57,110
    
    
    $
    73,795
    
    
    $
    112,102Additional interest income if loan had been accruing
    
    $
    189,405
    
    
    $
    147,995
    
    
    $
    165,475
    
    
    $
    101,190
    
    
    $
    168,426Commerical Construction# of loans
    
    $
    1
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Interest income recognized
    
    $
    105,230
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Additional interest income if loan had been accruing
    
    $
    10,389
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Consumer# of loans
    
    
    4
    
    
    
    2
    
    
    
    3
    
    
    
    3
    
    
    
    Interest income recognized
    
    $
    1,076
    
    

    $
    
    
    
    $
    382
    
    
    $
    20,155
    
    
    $
    Additional interest income if loan had been accruing
    
    $
    19,670
    
    
    $
    21,276
    
    
    $
    22,461
    
    
    $
    36,531
    
    
    $
    Residential mortgage loans# of loans
    
    
    15
    
    
    
    23
    
    
    
    20
    
    
    
    15
    
    
    
    13Interest income recognized
    
    $
    46,531
    
    
    $
    12,059
    
    
    $
    52,430
    
    
    $
    8,737
    
    
    $
    42,539Additional interest income if loan had been accruing
    
    $
    71,882
    
    
    $
    80,425
    
    
    $
    73,499
    
    
    $
    68,942
    
    
    $
    22,527Credit cards# of loans
    
    
    6
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Interest income recognized
    
    $
    2,680
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Additional interest income if loan had been accruing
    
    $
    1,311
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Restructured loans
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
 Capital Resources
     45




---



##### Table of Contents



2007
    
    
    
    
    2006
    
    
    2005Amount
    
    
    Rate
    
    
    Maturity
    
    
    
    
    Amount
    
    
    Rate
    
    
    Maturity
    
    
    Amount
    
    
    Rate
    
    
    Maturity3,000,000
    
    
    
    5.55
    %
    
    
    10/02/2008
    
    
    
    
    
    8,000,000
    
    
    
    4.19
    %
    
    
    07/24/2007
    
    
    
    5,000,000
    
    
    
    5.43
    %
    
    
    03/16/20063,000,000
    
    
    
    5.57
    %
    
    
    08/13/2007
    
    
    
    5,000,000
    
    
    
    5.32
    %
    
    
    05/08/20063,000,000
    
    
    
    5.55
    %
    
    
    10/02/2008
    
    
    
    8,000,000
    
    
    
    4.19
    %
    
    
    07/24/20073,000,000
    
    
    
    5.57
    %
    
    
    08/13/20073,000,000
    
    
    
    5.55
    %
    
    
    10/02/2008$
    3,000,000
    
    
    
    
    
    
    
    
    
    
    
    
    $
    14,000,000
    
    
    
    
    
    
    
    
    
    
    $
    24,000,000
    Well
    
    
    AdequatelyActual
    
    
    Capitalized
    
    
    CapitalizedTier 1 risk-based capital ratio
    
    
    9.0
    %
    
    
    6.0
    %
    
    
    4.0
    %Total risk-based capital ratio
    
    
    10.6
    %
    
    
    10.0
    %
    
    
    8.0
    %Leverage ratio
    
    
    7.0
    %
    
    
    5.0
    %
    
    
    4.0
    %
  46




---



##### Table of Contents



Recent Accounting Pronouncements and Developments
   47




---



##### Table of Contents



CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
     48




---



##### Table of Contents



Item 7A. Quantitative and Qualitative Disclosures about Market Risk
      49




---



##### Table of Contents



50




---



##### Table of Contents



Item 8. Financial Statements and Supplementary Data
     /s/ Morris L. Maurer
    
    
    
    /s/ Debra L. RossMorris L. Maurer
    
    
    
    Debra L. RossPresident and Chief Executive Officer
    
    
    
    Senior Vice President and Chief Financial Officer
  51




---



##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
       52




---



##### Table of Contents



Indianapolis, IN
    
    /s/ Ernst & Young LLPMarch 7, 2008
  53




---



##### Table of Contents



Share-Based Payment
  Indianapolis, IN
    
    /s/ Ernst & Young LLPMarch 7, 2008
  54




---



##### Table of Contents



December 312007
    
    
    2006As RestatedAssetsCash and due from banks
    
    $
    41,966,169
    
    
    $
    71,227,890Reverse repurchase agreements
    
    
    81,000,000
    
    
    
    1,000,000Federal funds sold
    
    
    39,356,700
    
    
    
    39,648,321162,322,869
    
    
    
    111,876,211Available-for-sale securities
    
    
    62,267,910
    
    
    
    60,790,222Held-to-maturity securities (fair value of $72,034,922
and $85,279,591 at December 31, 2007 and 2006)
    
    
    71,755,912
    
    
    
    86,197,233Total investment securities
    
    
    134,023,822
    
    
    
    146,987,455Loans
    
    
    830,328,325
    
    
    
    744,537,934Less allowance for loan losses
    
    
    (9,452,715
    )
    
    
    (8,513,098
    )Net loans
    
    
    820,875,610
    
    
    
    736,024,836Premises and equipment
    
    
    17,416,132
    
    
    
    12,066,888Accrued interest receivable
    
    
    5,465,584
    
    
    
    5,477,689Federal Reserve and FHLB stock
    
    
    3,149,900
    
    
    
    3,149,900Other assets
    
    
    19,855,140
    
    
    
    18,848,856Total assets
    
    $
    1,163,109,057
    
    
    $
    1,034,431,835Liabilities and shareholders equityDeposits:Noninterest-bearing demand deposits
    
    $
    180,590,295
    
    
    $
    181,953,564Money market and savings deposits
    
    
    629,341,940
    
    
    
    505,314,281Time deposits over $100,000
    
    
    109,901,689
    
    
    
    107,050,693Other time deposits
    
    
    84,928,105
    
    
    
    80,765,095Total deposits
    
    
    1,004,762,029
    
    
    
    875,083,633Security repurchase agreements
    
    
    58,475,789
    
    
    
    59,133,328FHLB advances
    
    
    3,000,000
    
    
    
    14,000,000Subordinated debt
    
    
    5,000,000
    
    
    
    5,000,000Junior subordinated debentures owed to unconsolidated
subsidiary trust
    
    
    13,918,000
    
    
    
    13,918,000Other liabilities
    
    
    9,015,233
    
    
    
    7,512,043Total liabilities
    
    
    1,094,171,051
    
    
    
    974,647,004Shareholders equity:Common stock, no par value:Authorized shares; 2007 and 2006  3,000,000 shares;
issued 2,741,438 in 2007 and 2,677,870 in 2006;
outstanding 2,326,335 in 2007 and 2,310,486 in 2006
    
    
    17,126,383
    
    
    
    17,801,380Additional paid-in capital
    
    
    7,180,886
    
    
    
    6,236,115Retained earnings
    
    
    44,170,868
    
    
    
    36,280,319Accumulated other comprehensive income (loss)
    
    
    459,869
    
    
    
    (532,983
    )Total shareholders equity
    
    
    68,938,006
    
    
    
    59,784,831Total liabilities and shareholders equity
    
    $
    1,163,109,057
    
    
    $
    1,034,431,835
 See accompanying notes.
  55




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##### Table of Contents



Year Ended December 312007
    
    
    2006
    
    
    2005As Restated
    
    
    As RestatedInterest income:Interest and fees on loans
    
    $
    57,383,476
    
    
    $
    52,723,884
    
    
    $
    43,255,856Interest on investment securities taxable
    
    
    6,777,040
    
    
    
    4,908,529
    
    
    
    5,725,813Interest on investment securities nontaxable
    
    
    1,816,759
    
    
    
    1,781,552
    
    
    
    428,464Interest on federal funds sold
    
    
    2,491,651
    
    
    
    1,848,871
    
    
    
    1,291,306Interest on reverse repurchase agreements
    
    
    410,757
    
    
    
    112,375
    
    
    
    145,668Total interest income
    
    
    68,879,683
    
    
    
    61,375,211
    
    
    
    50,847,107Interest expense:Interest on deposits
    
    
    30,847,099
    
    
    
    24,542,555
    
    
    
    16,109,423Interest on security repurchase agreements
    
    
    2,078,009
    
    
    
    2,128,130
    
    
    
    1,527,886Interest on FHLB advances and overnight borrowings
    
    
    463,016
    
    
    
    1,027,733
    
    
    
    1,497,247Interest on long-term debt
    
    
    1,874,507
    
    
    
    1,866,100
    
    
    
    1,771,259Total interest expense
    
    
    35,262,631
    
    
    
    29,564,518
    
    
    
    20,905,815Net interest income
    
    
    33,617,052
    
    
    
    31,810,693
    
    
    
    29,941,292Provision for loan losses
    
    
    904,000
    
    
    
    1,086,000
    
    
    
    2,085,000Net interest income after provision for loan losses
    
    
    32,713,052
    
    
    
    30,724,693
    
    
    
    27,856,292Other operating income:Wealth management fees
    
    
    4,546,795
    
    
    
    3,715,964
    
    
    
    3,096,847Service charges and fees on deposit accounts
    
    
    1,818,505
    
    
    
    1,712,924
    
    
    
    1,833,825Rental income
    
    
    596,753
    
    
    
    451,473
    
    
    
    449,715Mortgage banking income
    
    
    392,314
    
    
    
    331,866
    
    
    
    313,588Interchange income
    
    
    868,891
    
    
    
    792,839
    
    
    
    670,725Other income
    
    
    1,802,067
    
    
    
    1,354,460
    
    
    
    1,096,173Total other operating income
    
    
    10,025,325
    
    
    
    8,359,526
    
    
    
    7,460,873Other operating expenses:Salaries, wages, and employee benefits
    
    
    19,098,118
    
    
    
    18,010,560
    
    
    
    15,283,832Occupancy
    
    
    1,790,671
    
    
    
    1,735,164
    
    
    
    1,704,720Furniture and equipment
    
    
    1,240,816
    
    
    
    1,181,583
    
    
    
    898,355Professional services
    
    
    1,800,019
    
    
    
    1,447,479
    
    
    
    1,424,921Data processing
    
    
    1,775,273
    
    
    
    1,678,083
    
    
    
    1,571,855Business development
    
    
    1,292,463
    
    
    
    1,176,403
    
    
    
    1,071,823Other
    
    
    3,994,419
    
    
    
    3,369,222
    
    
    
    3,220,817Total other operating expenses
    
    
    30,991,779
    
    
    
    28,598,494
    
    
    
    25,176,323Income before tax
    
    
    11,746,598
    
    
    
    10,485,725
    
    
    
    10,140,842Federal and state income tax
    
    
    3,856,049
    
    
    
    3,500,936
    
    
    
    3,910,675Net income
    
    $
    7,890,549
    
    
    $
    6,984,789
    
    
    $
    6,230,167Basic earnings per share
    
    $
    3.39
    
    
    $
    3.03
    
    
    $
    2.71Diluted earnings per share
    
    $
    3.27
    
    
    $
    2.90
    
    
    $
    2.61
 See accompanying notes.
  56




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##### Table of Contents



AccumulatedAdditional
    
    
    
    
    
    
    OtherCommon
    
    
    Unearned
    
    
    Paid-In
    
    
    Retained
    
    
    ComprehensiveStock
    
    
    Compensation
    
    
    Capital
    
    
    Earnings
    
    
    Income (Loss)
    
    
    TotalBalance at December 31, 2004, as restated
    
    $
    20,595,989
    
    
    $
    (624,543
    )
    
    $
    4,136,401
    
    
    $
    23,065,363
    
    
    $
    (629,523
    )
    
    $
    46,543,687Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,230,167
    
    
    
    
    
    
    
    6,230,167Other comprehensive income:Net unrealized loss on
investments, net of tax
of $341,714
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (520,982
    )
    
    
    (520,982
    )Net unrealized loss on
swap, net of tax
of $63,019
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (96,079
    )
    
    
    (96,079
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,613,106Income tax benefit from deferred stock compensation
    
    
    
    
    
    
    
    
    
    
    205,009
    
    
    
    
    
    
    
    
    
    
    
    205,009Issuance of 29,305 shares of common stock
under stock-based compensation plans
    
    
    646,906
    
    
    
    9,809
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    656,715Repurchase of 45,073 shares of common stock
    
    
    (1,693,222
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,693,222
    )Compensation earned
    
    
    
    
    
    
    257,227
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    257,227Balance at December 31, 2005, as restated
    
    
    19,549,673
    
    
    
    (357,507
    )
    
    
    4,341,410
    
    
    
    29,295,530
    
    
    
    (1,246,584
    )
    
    
    51,582,522Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,984,789
    
    
    
    
    
    
    
    6,984,789Other comprehensive income:Net unrealized gain on
investments, net of tax
of $319,077
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    486,470
    
    
    
    486,470Net unrealized gain on
swap, net of tax
of $148,976
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    227,131
    
    
    
    227,131Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,698,390Income tax benefit from deferred stock compensation
    
    
    
    
    
    
    
    
    
    
    559,260
    
    
    
    
    
    
    
    
    
    
    
    559,260Issuance of 61,768 shares of common stock
under stock-based compensation plans
    
    
    1,360,600
    
    
    
    
    
    
    
    (250,750
    )
    
    
    
    
    
    
    
    
    
    
    1,109,850Repurchase of 42,989 shares of common stock
    
    
    (1,936,368
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,936,368
    )Compensation earned
    
    
    
    
    
    
    
    
    
    
    771,177
    
    
    
    
    
    
    
    
    
    
    
    771,177Adoption of FASB 123(R) reversal of (41,700) shares
of unvested restricted common stock
    
    
    (1,172,525
    )
    
    
    357,507
    
    
    
    815,018
    
    
    
    
    
    
    
    
    
    
    
    Balance at December 31, 2006, as restated
    
    
    17,801,380
    
    
    
    
    
    
    
    6,236,115
    
    
    
    36,280,319
    
    
    
    (532,983
    )
    
    
    59,784,831Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,890,549
    
    
    
    
    
    
    
    7,890,549Other comprehensive income:Net unrealized gain on
investments, net of tax
of $587,524
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    895,748
    
    
    
    895,748Net unrealized gain on
swap, net of tax
of $63,691
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    97,104
    
    
    
    97,104Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,883,401Income tax benefit from deferred stock compensation
    
    
    
    
    
    
    
    
    
    
    551,616
    
    
    
    
    
    
    
    
    
    
    
    551,616Issuance of 63,567 shares of common stock
under stock-based compensation plans
    
    
    1,719,406
    
    
    
    
    
    
    
    (815,792
    )
    
    
    
    
    
    
    
    
    
    
    903,614Repurchase of 47,718 shares of common stock
    
    
    (2,394,403
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,394,403
    )Compensation earned
    
    
    
    
    
    
    
    
    
    
    1,208,947
    
    
    
    
    
    
    
    
    
    
    
    1,208,947Balance at December 31, 2007
    
    $
    17,126,383
    
    
    $
    
    
    
    $
    7,180,886
    
    
    $
    44,170,868
    
    
    $
    459,869
    
    
    $
    68,938,006
 See accompanying notes.
  57




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##### Table of Contents



Year Ended December 312007
    
    
    2006
    
    
    2005As Restated
    
    
    As RestatedOperating activitiesNet income
    
    $
    7,890,549
    
    
    $
    6,984,789
    
    
    $
    6,230,167Adjustments to reconcile net income to net
cash provided by operating activities:Provision for loan losses
    
    
    904,000
    
    
    
    1,086,000
    
    
    
    2,085,000Proceeds from sale of loans held-for-sale
    
    
    15,188,351
    
    
    
    16,233,576
    
    
    
    18,372,384Origination of loans held-for-sale
    
    
    (15,003,351
    )
    
    
    (13,734,219
    )
    
    
    (10,300,026
    )Depreciation and amortization
    
    
    1,408,010
    
    
    
    1,645,031
    
    
    
    1,413,527Mortgage servicing rights impairment (recoveries) charges
    
    
    144,650
    
    
    
    (123,090
    )
    
    
    (167,918
    )Gain on sale of loans
    
    
    (205,425
    )
    
    
    (156,583
    )
    
    
    (82,493
    )Gain on disposal of premises and equipment
    
    
    (1,260
    )
    
    
    
    
    
    
    (23,100
    )Net decrease in deferred income taxes
    
    
    325,232
    
    
    
    325,702
    
    
    
    421,841Excess tax benefit from deferred stock compensation
    
    
    (551,616
    )
    
    
    (559,260
    )
    
    
    205,009Board stock compensation
    
    
    99,709
    
    
    
    99,786
    
    
    
    99,793Net accretion/amortization of discounts and premiums
on investments
    
    
    175,081
    
    
    
    271,763
    
    
    
    314,501Unearned compensation amortization
    
    
    
    
    
    
    
    
    
    
    257,227Compensation expense related to restricted stock and
options
    
    
    1,208,947
    
    
    
    771,177
    
    
    
    (Increase) decrease in:Accrued interest receivable
    
    
    12,105
    
    
    
    (875,644
    )
    
    
    (601,307
    )Other assets
    
    
    (1,966,600
    )
    
    
    (11,472,443
    )
    
    
    (1,018,267
    )Increase in other liabilities
    
    
    2,054,806
    
    
    
    1,982,088
    
    
    
    230,794Net cash provided by operating activities
    
    
    11,683,188
    
    
    
    2,478,673
    
    
    
    17,437,132Investing activitiesProceeds from maturities of investment
securities held-to-maturity
    
    
    14,284,373
    
    
    
    8,375,465
    
    
    
    1,921,232Proceeds from maturities of investment
securities available-for-sale
    
    
    36,513,792
    
    
    
    11,518,393
    
    
    
    42,527,411Purchases of investment securities held-to-maturity
    
    
    (25,000
    )
    
    
    (10,548,243
    )
    
    
    (30,311,560
    )Purchases of investment securities available-for-sale
    
    
    (36,501,327
    )
    
    
    (1,478,594
    )
    
    
    (20,986,074
    )Net increase in loans
    
    
    (85,734,349
    )
    
    
    (63,312,198
    )
    
    
    (37,559,511
    )Purchases of premises and equipment
    
    
    (6,755,994
    )
    
    
    (1,573,196
    )
    
    
    (3,324,070
    )Net cash used in investing activities
    
    
    (78,218,505
    )
    
    
    (57,018,373
    )
    
    
    (47,732,572
    )Financing activitiesNet increase in deposits
    
    
    129,678,396
    
    
    
    100,767,918
    
    
    
    80,884,670Net change in security repurchase agreements
    
    
    (657,539
    )
    
    
    5,576,926
    
    
    
    (30,606,224
    )Net change in FHLB advances
    
    
    (11,000,000
    )
    
    
    (10,000,000
    )
    
    
    (8,000,000
    )Proceeds from issuance of long-term debt
    
    
    5,000,000
    
    
    
    
    
    
    
    Repayment from issuance of long-term debt
    
    
    (5,000,000
    )
    
    
    
    
    
    
    Repurchase of stock
    
    
    (2,394,403
    )
    
    
    (1,936,368
    )
    
    
    (1,693,222
    )Income tax benefit from exercise of options (FASB 123(R))
    
    
    551,616
    
    
    
    559,260
    
    
    
    Proceeds from issuance of stock
    
    
    803,905
    
    
    
    1,010,064
    
    
    
    556,922Net cash provided by financing activities
    
    
    116,981,975
    
    
    
    95,977,800
    
    
    
    41,142,146Increase in cash and cash equivalents
    
    
    50,446,658
    
    
    
    41,438,100
    
    
    
    10,846,706Cash and cash equivalents at beginning of year
    
    
    111,876,211
    
    
    
    70,438,111
    
    
    
    59,591,405Cash and cash equivalents at end of year
    
    $
    162,322,869
    
    
    $
    111,876,211
    
    
    $
    70,438,111Interest paid
    
    $
    35,052,326
    
    
    $
    28,639,659
    
    
    $
    20,394,928Income taxes paid
    
    $
    2,668,571
    
    
    $
    4,137,770
    
    
    $
    4,293,994
 See accompanying notes.
  58




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements
 December 31, 2007
 1. Organization and Significant Accounting Policies
 Organization
  Consolidation
of Variable Interest Entities, an Interpretation of Accounting Research Bulletin No. 51
 Cash and Cash Equivalents
  Investment Securities
    59




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 1. Organization and Significant Accounting Policies (continued)
    Loans
    Allowance for Loan Losses
   60




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 1. Organization and Significant Accounting Policies (continued)
 Selected Loan Loss Allowance Methodology and
Documentation Issues Accounting for Contingencies Accounting by Creditors for Impairment of a Loan Accounting by Creditors for Impairment of a Loan  Income Recognition and
Disclosures
    Mortgage Servicing Rights
   61




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 1. Organization and Significant Accounting Policies (continued)
  Accounting for Servicing of
Financial Assets
  Derivative Instruments and Hedging Activities
 Accounting for Derivative Instruments and Hedging Activities )
   62




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 1. Organization and Significant Accounting Policies (continued)
 Premises and Equipment
  Comprehensive Income
  Earnings Per Share
  Fair Values of Financial Instruments
  Stock-Based Compensation
 Accounting for Stock Issued to
Employees
  63




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 1. Organization and Significant Accounting Policies (continued)
 Share-Based Payment Accounting for
Stock-Based Compensation Accounting for Stock-Based Compensation  Transition
and Disclosure  an amendment of FASB Statement No. 123
 2005As RestatedNet income, as reported
    
    $
    6,230,167Add stock-based compensation expense, net of related taxes
    
    
    155,340Less total stock-based compensation expense determined
under fair-value-based method, net of taxes
    
    
    (286,764
    )Pro forma net income
    
    $
    6,098,743Earnings per share:Basic, as reported
    
    $
    2.71Basic, pro forma
    
    $
    2.65Diluted, as reported
    
    $
    2.61Diluted, pro forma
    
    $
    2.55
  64




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 1. Organization and Significant Accounting Policies (continued)
  Reportable Segments
  Income Taxes
   Securities Purchased Under Resale Agreements and Securities Sold Under Repurchase Agreements
   65




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 1. Organization and Significant Accounting Policies (continued)
 Bank-Owned Life Insurance
  Reclassifications
  Use of Estimates
  2. Restatement of Prior Years Financial Statements
     66




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 2. Restatement of Prior Years Financial Statements (continued)
 Statement of Shareholders Equity:
 December 31, 2006
    
    
    December 31, 2005
    
    
    December 31, 2004As Reported
    
    
    As Restated
    
    
    As Reported
    
    
    As Restated
    
    
    As Reported
    
    
    As RestatedAdditional paid-in
capital
    
    $
    5,826,532
    
    
    $
    6,236,115
    
    
    $
    4,009,263
    
    
    $
    4,341,410
    
    
    $
    3,836,613
    
    
    $
    4,136,401Retained earnings
    
    $
    36,689,902
    
    
    $
    36,280,319
    
    
    $
    29,627,677
    
    
    $
    29,295,530
    
    
    $
    23,365,151
    
    
    $
    23,065,363
 Statement of Income
 Year Ended December 312006
    
    
    2005As Reported
    
    
    As Restated
    
    
    As Reported
    
    
    As RestatedIncome before tax
    
    $
    10,485,725
    
    
    $
    10,485,725
    
    
    $
    10,140,842
    
    
    $
    10,140,842Federal and state income tax
    
    $
    3,423,500
    
    
    $
    3,500,936
    
    
    $
    3,878,316
    
    
    $
    3,910,675Net income after tax
    
    $
    7,062,225
    
    
    $
    6,984,789
    
    
    $
    6,262,526
    
    
    $
    6,230,167Basic earnings per share
    
    $
    3.07
    
    
    $
    3.03
    
    
    $
    2.72
    
    
    $
    2.71Diluted earnings per share
    
    $
    2.94
    
    
    $
    2.90
    
    
    $
    2.62
    
    
    $
    2.61
  3. New Accounting Pronouncements
 Accounting for Certain Hybrid Financial
Instruments Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities
  67




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 3. New Accounting Pronouncements (continued)
  Accounting for Uncertainty in Income Taxes Accounting for Income Taxes
 Fair Value Measurements
  68




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 3. New Accounting Pronouncements (continued)
 The Fair Value Option for Financial Assets and
Financial Liabilities  Including an Amendment of FASB Statement No. 115
 4. Restrictions on Cash and Due From Bank Accounts
  5. Junior Subordinated Debentures
    69




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 6. Investment Securities
  Available-for-Sale SecuritiesGross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gain
    
    
    Loss
    
    
    ValueDecember 31, 2007U.S. treasury securities
    
    $
    1,503,530
    
    
    $
    10,100
    
    
    $
    
    
    
    $
    1,513,630U.S. government agencies
    
    
    60,000,000
    
    
    
    889,799
    
    
    
    138,400
    
    
    
    60,751,399Collateralized mortgage
obligations
    
    
    2,881
    
    
    
    
    
    
    
    
    
    
    
    2,881$
    61,506,411
    
    
    $
    899,899
    
    
    $
    138,400
    
    
    $
    62,267,910December 31, 2006U.S. treasury securities
    
    $
    1,495,336
    
    
    $
    
    
    
    $
    981
    
    
    $
    1,494,355U.S. government agencies
    
    
    60,000,000
    
    
    
    
    
    
    
    720,799
    
    
    
    59,279,201Collateralized mortgage
obligations
    
    
    16,659
    
    
    
    7
    
    
    
    
    
    
    
    16,666$
    61,511,995
    
    
    $
    7
    
    
    $
    721,780
    
    
    $
    60,790,222
 Held-to-Maturity SecuritiesGross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gain
    
    
    Loss
    
    
    ValueDecember 31, 2007Municipals
    
    $
    46,256,605
    
    
    $
    553,799
    
    
    $
    11,623
    
    
    $
    46,798,781Collateralized
mortgage
obligations
    
    
    25,299,307
    
    
    
    
    
    
    
    262,570
    
    
    
    25,036,737Other securities
    
    
    200,000
    
    
    
    
    
    
    
    596
    
    
    
    199,404$
    71,755,912
    
    
    $
    553,799
    
    
    $
    274,789
    
    
    $
    72,034,922December 31, 2006Municipals
    
    $
    46,247,490
    
    
    $
    247,212
    
    
    $
    211,345
    
    
    $
    46,283,357Collateralized
mortgage
obligations
    
    
    39,724,743
    
    
    
    
    
    
    
    952,366
    
    
    
    38,772,377Other securities
    
    
    225,000
    
    
    
    1,182
    
    
    
    2,325
    
    
    
    223,857$
    86,197,233
    
    
    $
    248,394
    
    
    $
    1,166,036
    
    
    $
    85,279,591
  70




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 6. Investment Securities (continued)
  Available-for-Sale SecuritiesWeighted-Within 1
    
    
    
    
    
    
    5 to 10
    
    
    
    
    
    
    AverageYear
    
    
    1 to 5 Years
    
    
    Years
    
    
    Total
    
    
    YieldU.S. treasury and U.S. government
agency debentures
    
    $
    21,503,530
    
    
    $
    40,000,000
    
    
    $
    
    
    
    $
    61,503,530
    
    
    
    4.34
    %Collateralized mortgage obligations
    
    
    2,881
    
    
    
    
    
    
    
    
    
    
    
    2,881
    
    
    
    5.39
    %Amortized cost
    
    $
    21,506,411
    
    
    $
    40,000,000
    
    
    $
    
    
    
    $
    61,506,411Fair value
    
    $
    21,378,111
    
    
    $
    40,889,799
    
    
    $
    
    
    
    $
    62,267,910Weighted-average yield
    
    
    3.10
    %
    
    
    5.00
    %
    
    
    
    
    
    
    4.34
    %
 Held-to-Maturity SecuritiesWeighted-Within 1
    
    
    
    
    
    
    5 to 10
    
    
    Greater Than 10
    
    
    
    
    
    
    AverageYear
    
    
    1 to 5 Years
    
    
    Years
    
    
    Years
    
    
    Total
    
    
    YieldOther securities
    
    $
    50,000
    
    
    $
    150,000
    
    
    $
    
    
    
    $
    
    
    
    $
    200,000
    
    
    
    4.36
    %Municipals
    
    
    
    
    
    
    5,589,806
    
    
    
    33,630,624
    
    
    
    7,036,175
    
    
    
    46,256,605
    
    
    
    3.93
    %Collateralized
mortgage obligations
    
    
    10,733,744
    
    
    
    14,565,563
    
    
    
    
    
    
    
    
    
    
    
    25,299,307
    
    
    
    3.46
    %Amortized cost
    
    $
    10,783,744
    
    
    $
    20,305,369
    
    
    $
    33,630,624
    
    
    $
    7,036,175
    
    
    $
    71,755,912Fair value
    
    $
    10,692,232
    
    
    $
    20,339,349
    
    
    $
    33,944,686
    
    
    $
    7,058,655
    
    
    $
    72,034,922Weighted-average yield
    
    
    3.29
    %
    
    
    3.96
    %
    
    
    3.78
    %
    
    
    3.87
    %
    
    
    3.76
    %
  71




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 6. Investment Securities (continued)
     72




---



##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 6. Investment Securities (continued)
 Available-for-Sale SecuritiesLess Than 12 Months
    
    
    Greater Than 12 Monthsin an Unrealized Loss Position
    
    
    in an Unrealized Loss PositionTotal
    
    
    TotalUnrealized
    
    
    Number
    
    
    
    
    
    
    Unrealized
    
    
    Number
    
    
    
    
    
    
    Unrealized
    
    
    EstimatedLoss
    
    
    of
    
    
    Estimated
    
    
    Loss
    
    
    Of
    
    
    Estimated
    
    
    Loss
    
    
    FairDecember 31, 2007
    
    Amount
    
    
    Securities
    
    
    Fair Value
    
    
    Amount
    
    
    Securities
    
    
    Fair Value
    
    
    Amount
    
    
    ValueU.S. government
agencies
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    138,400
    
    
    
    1
    
    
    $
    19,861,600
    
    
    $
    138,400
    
    
    $
    19,861,600$
    
    
    
    
    
    
    
    $
    
    
    
    $
    138,400
    
    
    
    1
    
    
    $
    19,861,600
    
    
    $
    138,400
    
    
    $
    19,861,600
 Available-for-Sale SecuritiesLess Than 12 Months
    
    
    Greater Than 12 Monthsin an Unrealized Loss Position
    
    
    in an Unrealized Loss PositionTotal
    
    
    TotalUnrealized
    
    
    Number
    
    
    
    
    
    
    Unrealized
    
    
    Number
    
    
    
    
    
    
    Unrealized
    
    
    EstimatedLoss
    
    
    of
    
    
    Estimated
    
    
    Loss
    
    
    Of
    
    
    Estimated
    
    
    Loss
    
    
    FairDecember 31, 2006
    
    Amount
    
    
    Securities
    
    
    Fair Value
    
    
    Amount
    
    
    Securities
    
    
    Fair Value
    
    
    Amount
    
    
    ValueU.S. treasury
securities
    
    $
    981
    
    
    
    3
    
    
    $
    1,494,355
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    981
    
    
    $
    1,494,355U.S. government
agencies
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    720,799
    
    
    
    3
    
    
    
    59,279,201
    
    
    
    720,799
    
    
    
    59,279,201$
    981
    
    
    
    3
    
    
    $
    1,494,355
    
    
    $
    720,799
    
    
    
    3
    
    
    $
    59,279,201
    
    
    $
    721,780
    
    
    $
    60,773,556
 Held-to-Maturity SecuritiesLess Than 12 Months
    
    
    Greater Than 12 Monthsin an Unrealized Loss Position
    
    
    in an Unrealized Loss PositionTotal
    
    
    TotalUnrealized
    
    
    Number
    
    
    
    
    
    
    Unrealized
    
    
    Number
    
    
    
    
    
    
    Unrealized
    
    
    EstimatedLoss
    
    
    of
    
    
    Estimated
    
    
    Loss
    
    
    Of
    
    
    Estimated
    
    
    Loss
    
    
    FairDecember 31, 2007
    
    Amount
    
    
    Securities
    
    
    Fair Value
    
    
    Amount
    
    
    Securities
    
    
    Fair Value
    
    
    Amount
    
    
    ValueCollateralized
mortgage
obligations
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    262,570
    
    
    
    3
    
    
    $
    25,036,737
    
    
    $
    262,570
    
    
    $
    25,036,737Municipal bonds
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,623
    
    
    
    5
    
    
    
    2,812,330
    
    
    
    11,623
    
    
    
    2,812,330Other securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    596
    
    
    
    4
    
    
    
    99,404
    
    
    
    596
    
    
    
    99,404$
    
    
    
    
    
    
    
    $
    
    
    
    $
    274,789
    
    
    
    12
    
    
    $
    27,948,471
    
    
    $
    274,789
    
    
    $
    27,948,471
 Held-to-Maturity SecuritiesLess Than 12 Months
    
    
    Greater Than 12 Monthsin an Unrealized Loss Position
    
    
    in an Unrealized Loss PositionTotal
    
    
    TotalUnrealized
    
    
    Number
    
    
    
    
    
    
    Unrealized
    
    
    Number
    
    
    
    
    
    
    Unrealized
    
    
    EstimatedLoss
    
    
    of
    
    
    Estimated
    
    
    Loss
    
    
    of
    
    
    Estimated
    
    
    Loss
    
    
    FairDecember 31, 2006
    
    Amount
    
    
    Securities
    
    
    Fair Value
    
    
    Amount
    
    
    Securities
    
    
    Fair Value
    
    
    Amount
    
    
    ValueCollateralized mortgage
obligations
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    952,366
    
    
    
    3
    
    
    $
    38,772,377
    
    
    $
    952,366
    
    
    $
    38,772,377Municipal bonds
    
    
    73,284
    
    
    
    26
    
    
    
    9,725,059
    
    
    
    138,061
    
    
    
    49
    
    
    
    25,094,018
    
    
    
    211,345
    
    
    
    34,819,077Other securities
    
    
    555
    
    
    
    1
    
    
    
    24,445
    
    
    
    1,770
    
    
    
    5
    
    
    
    123,230
    
    
    
    2,325
    
    
    
    147,675$
    73,839
    
    
    
    27
    
    
    $
    9,749,504
    
    
    $
    1,092,197
    
    
    
    57
    
    
    $
    63,989,625
    
    
    $
    1,166,036
    
    
    $
    73,739,129
  73




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 6. Investment Securities (continued)
  7. Derivative Instruments and Hedging Activities
  December 31, 2007
    
    
    December 31, 2006Net
    
    
    
    
    
    
    
    
    
    
    NetIneffectiveness
    
    
    
    
    
    
    
    
    
    
    IneffectivenessNotional
    
    
    Derivative
    
    
    Hedge Gains
    
    
    Notional
    
    
    Derivative
    
    
    Hedge GainsAmount
    
    
    Liability
    
    
    (Losses)
    
    
    Amount
    
    
    Liability
    
    
    (Losses)Receive fixed
interest rate
swap
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    20,000,000
    
    
    $
    160,795
    
    
    $
    
 8. Loans and Allowance for Loan Losses
  2007
    
    
    2006Residential loans secured by real estate
    
    $
    325,596,434
    
    
    $
    274,253,154Commercial loans secured by real estate
    
    
    175,027,267
    
    
    
    164,256,356Other commercial and industrial loans
    
    
    279,109,370
    
    
    
    253,744,685Consumer loans
    
    
    50,595,254
    
    
    
    52,283,739Total loans
    
    
    830,328,325
    
    
    
    744,537,934Less allowance for loan losses
    
    
    (9,452,715
    )
    
    
    (8,513,098
    )Total loans, net
    
    $
    820,875,610
    
    
    $
    736,024,836
   74




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 8. Loans and Allowance for Loan Losses (continued)
    2007
    
    
    2006
    
    
    2005Beginning balance
    
    $
    8,513,098
    
    
    $
    8,346,390
    
    
    $
    7,795,803Net (charge-offs) recoveries
    
    
    35,617
    
    
    
    (919,292
    )
    
    
    (1,534,413
    )Provision for loan losses
    
    
    904,000
    
    
    
    1,086,000
    
    
    
    2,085,000Ending balance
    
    $
    9,452,715
    
    
    $
    8,513,098
    
    
    $
    8,346,390
  2007
    
    
    2006
    
    
    2005Total number of impaired loans
    
    
    33
    
    
    
    35
    
    
    
    38Total amount of impaired loans
    
    $
    5,789,182
    
    
    $
    7,185,421
    
    
    $
    3,648,491Average balance of impaired loans
    
    $
    5,386,000
    
    
    $
    3,723,000
    
    
    $
    2,964,000Contractual interest due
    
    $
    533,384
    
    
    $
    467,885
    
    
    $
    371,357Actual accrued interest recorded
    
    $
    240,727
    
    
    $
    218,190
    
    
    $
    109,922Related allowance on impaired loans
    
    $
    1,066,158
    
    
    $
    450,320
    
    
    $
    865,268Impaired loans with related allowance
    
    $
    3,358,431
    
    
    $
    1,986,437
    
    
    $
    3,288,984Impaired loans without an allowance
    
    $
    2,430,751
    
    
    $
    5,198,984
    
    
    $
    359,507
  75




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 8. Loans and Allowance for Loan Losses (continued)
   9. Premises and Equipment
  2007
    
    
    2006Land and improvements
    
    $
    5,886,875
    
    
    $
    2,859,400Building and improvements
    
    
    9,477,149
    
    
    
    7,833,610Construction-in-progress
    
    
    1,544,149
    
    
    
    102,734Leasehold improvements
    
    
    1,680,353
    
    
    
    1,628,213Furniture and equipment
    
    
    10,535,796
    
    
    
    9,975,43629,124,322
    
    
    
    22,399,393Less accumulated depreciation and amortization
    
    
    (11,708,190
    )
    
    
    (10,332,505
    )Net premises and equipment
    
    $
    17,416,132
    
    
    $
    12,066,888
   2008
    
    $
    300,7492009
    
    
    344,9172010
    
    
    259,7052011
    
    
    204,4952012
    
    
    207,617Thereafter
    
    
    1,416,081$
    2,733,564
  76




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 10. Mortgage Banking Activities
    2007
    
    
    2006Balance at January 1
    
    $
    1,326,603
    
    
    $
    1,482,554Plus additions
    
    
    166,034
    
    
    
    169,504Less amortization
    
    
    
    
    
    
    (266,327
    )Market adjustments
    
    
    (144,650
    )
    
    
    Balance at December 31
    
    
    1,347,987
    
    
    
    1,385,731Less valuation allowance
    
    
    
    
    
    
    (59,128
    )Balance, net
    
    $
    1,347,987
    
    
    $
    1,326,603
  77




---



##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 11. Deposits
  December 312007
    
    
    2006Demand accounts:Noninterest bearing
    
    $
    180,590,295
    
    
    $
    181,953,564Interest bearing
    
    
    117,709,143
    
    
    
    105,118,470Total demand accounts
    
    
    298,299,438
    
    
    
    287,072,034Money market accounts
    
    
    499,624,440
    
    
    
    388,255,230Savings accounts
    
    
    12,008,357
    
    
    
    11,940,581Time accounts:Over $100,000
    
    
    109,901,689
    
    
    
    107,050,693Under $100,000
    
    
    84,928,105
    
    
    
    80,765,095Total deposits
    
    $
    1,004,762,029
    
    
    $
    875,083,633
  GreaterLess Than
    
    
    Than$100,000
    
    
    $100,000Mature in three months or less
    
    $
    25,452,617
    
    
    $
    47,322,920Mature after three months through six months
    
    
    19,218,837
    
    
    
    19,733,860Mature after six months through twelve months
    
    
    26,604,253
    
    
    
    29,784,801Mature in 2009
    
    
    6,465,050
    
    
    
    5,894,225Mature in 2010
    
    
    2,428,176
    
    
    
    3,064,199Mature in 2011
    
    
    931,669
    
    
    
    1,450,811Mature in 2012
    
    
    919,137
    
    
    
    958,295Thereafter
    
    
    2,908,366
    
    
    
    1,692,578$
    84,928,105
    
    
    $
    109,901,689
  78




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 12. Other Borrowings
    2007
    
    
    
    
    2006Amount
    
    
    Rate
    
    
    Maturity
    
    
    
    
    Amount
    
    
    Rate
    
    
    Maturity$
    3,000,000
    
    
    
    5.55
    %
    
    
    10/2/2008
    
    
    
    
    $
    8,000,000
    
    
    
    4.19
    %
    
    
    07/24/20073,000,000
    
    
    
    5.57
    %
    
    
    08/13/20073,000,000
    
    
    
    5.55
    %
    
    
    10/02/2008$
    3,000,000
    
    
    
    
    
    
    
    
    
    
    
    
    $
    14,000,000
     79




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 13. Equity-Based Compensation
  1993 Stock Option Plan
  2007
    
    
    2006
    
    
    2005Weighted-
    
    
    
    
    
    
    Weighted-
    
    
    
    
    
    
    Weighted-Average
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    AverageExercise
    
    
    
    
    
    
    Exercise
    
    
    
    
    
    
    ExerciseOptions
    
    
    Price
    
    
    Options
    
    
    Price
    
    
    Options
    
    
    PriceOptions outstanding
at beginning of
year
    
    
    212,242
    
    
    $
    23.67
    
    
    
    257,525
    
    
    $
    22.52
    
    
    
    278,056
    
    
    $
    21.99Options exercised
    
    
    (26,550
    )
    
    
    18.75
    
    
    
    (43,683
    )
    
    
    16.71
    
    
    
    (19,531
    )
    
    
    14.70Options forfeited
or expired
    
    
    (2,029
    )
    
    
    34.50
    
    
    
    (1,600
    )
    
    
    27.75
    
    
    
    (1,000
    )
    
    
    27.75Options outstanding
at end of year
    
    
    183,663
    
    
    $
    24.26
    
    
    
    212,242
    
    
    $
    23.67
    
    
    
    257,525
    
    
    $
    22.52Exercisable at year
end
    
    
    175,600
    
    
    $
    23.92
    
    
    
    135,679
    
    
    $
    21.13
    
    
    
    173,820
    
    
    $
    19.77
   80




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 13. Equity-Based Compensation (continued)
  Weighted-AverageGrant Date Fair2007
    
    Options
    
    
    ValueNonvested options at beginning of year
    
    
    76,563
    
    
    $
    11.05Vested
    
    
    (68,500
    )
    
    $
    11.04Nonvested options at end of year
    
    
    8,063
    
    
    $
    11.15
        81




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 13. Equity-Based Compensation (continued)
  1993 Restricted Stock Plan
   Weighted-AverageRestricted
    
    
    Grant Date Fair2007
    
    Stock
    
    
    ValueNonvested restricted stock at beginning
of year
    
    
    32,000
    
    
    $
    28.20Vested
    
    
    (28,500
    )
    
    $
    27.75Nonvested restricted stock at end of year
    
    
    3,500
    
    
    $
    31.85
   82




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 13. Equity-Based Compensation (continued)
  2005 Equity Incentive Plan
  Stock Options Issued
    83




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 13. Equity-Based Compensation (continued)
  2007
    
    
    2006Weighted-
    
    
    
    
    
    
    Weighted-Average
    
    
    
    
    
    
    AverageExercise
    
    
    
    
    
    
    ExerciseOptions
    
    
    Price
    
    
    Options
    
    
    PriceOptions outstanding at beginning
of year
    
    
    176,000
    
    
    $
    43.38
    
    
    
    
    
    
    $
    New options granted
    
    
    12,500
    
    
    $
    49.78
    
    
    
    178,800
    
    
    $
    43.38Options exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Options forfeited
    
    
    
    
    
    
    
    
    
    
    (2,800
    )
    
    $
    43.38Options outstanding at end of year
    
    
    188,500
    
    
    $
    43.80
    
    
    
    176,000
    
    
    $
    43.38Exercisable at year-end
    
    
    2,800
    
    
    $
    43.38
    
    
    
    
    
    
    $
    
   Weighted-AverageGrant Date Fair2007
    
    Options
    
    
    ValueNonvested options at beginning of year
    
    
    176,000
    
    
    $
    17.89Granted
    
    
    12,500
    
    
    $
    20.12Vested
    
    
    (2,800
    )
    
    $
    17.89Nonvested options at end of year
    
    
    185,700
    
    
    $
    18.04
   84




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 13. Equity-Based Compensation (continued)
     Year
    
    Dividend Yield
    
    
    Volatility Factor
    
    
    Risk-Free Rate2007
    
    
    
    
    
    
    3.9242
    %
    
    
    5.18
    %2006
    
    
    
    
    
    
    4.9623
    %
    
    
    5.32
    %2005
    
    
    
    
    
    
    
    
    
    
    
  Restricted Stock Issued
   85




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 13. Equity-Based Compensation (continued)
  Weighted-AverageRestricted
    
    
    Grant Date Fair2007
    
    Stock
    
    
    ValueNonvested restricted stock at beginning
of year
    
    
    
    
    
    
    Granted
    
    
    65,725
    
    
    $
    49.78Nonvested restricted stock at end of year
    
    
    65,725
    
    
    $
    49.78
   14. Employee Benefit Program
     86




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 15. Dividend and Loan Limitation and Regulatory Capital Ratios
      87




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 15. Dividend and Loan Limitation and Regulatory Capital Ratios (continued)
  To Be WellCapitalized UnderFor Capital
    
    
    Prompt CorrectiveActual
    
    
    Adequacy Purposes
    
    
    Action ProvisionsAmount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio
    
    
    Amount
    
    
    RatioAs of December 31, 2007Tier 1 risk-based capital
    
    $
    79,702,438
    
    
    
    9.0
    %
    
    $
    35,625,196
    
    
    
    4.0
    %
    
    $
    53,437,794
    
    
    
    6.0
    %Total risk-based capital
    
    
    94,155,153
    
    
    
    10.6
    %
    
    
    71,250,392
    
    
    
    8.0
    %
    
    
    89,062,990
    
    
    
    10.0
    %Leveraged capital
    
    
    79,702,438
    
    
    
    7.0
    %
    
    
    45,865,062
    
    
    
    4.0
    %
    
    
    57,331,327
    
    
    
    5.0
    %As of December 31, 2006Tier 1 risk-based capital
    
    $
    71,317,878
    
    
    
    9.0
    %
    
    $
    31,725,806
    
    
    
    4.0
    %
    
    $
    47,588,709
    
    
    
    6.0
    %Total risk-based capital
    
    
    84,830,976
    
    
    
    10.7
    %
    
    
    63,451,612
    
    
    
    8.0
    %
    
    
    79,314,515
    
    
    
    10.0
    %Leveraged capital
    
    
    71,317,878
    
    
    
    7.1
    %
    
    
    40,428,004
    
    
    
    4.0
    %
    
    
    50,535,005
    
    
    
    5.0
    %
  88




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 15. Dividend and Loan Limitation and Regulatory Capital Ratios (continued)
  For CapitalActual
    
    
    Adequacy PurposesAmount
    
    
    Ratio
    
    
    Amount
    
    
    RatioAs of December 31, 2007Tier 1 risk-based capital
    
    $
    81,955,338
    
    
    
    9.2
    %
    
    $
    35,682,723
    
    
    
    4.0
    %Total risk-based capital
    
    
    96,408,053
    
    
    
    10.8
    %
    
    
    71,365,445
    
    
    
    8.0
    %Leveraged capital
    
    
    81,955,338
    
    
    
    7.2
    %
    
    
    45,859,425
    
    
    
    4.0
    %As of December 31, 2006Tier 1 risk-based capital
    
    $
    73,783,654
    
    
    
    9.3
    %
    
    $
    31,775,641
    
    
    
    4.0
    %Total risk-based capital
    
    
    87,296,752
    
    
    
    11.0
    %
    
    
    63,551,283
    
    
    
    8.0
    %Leveraged capital
    
    
    73,783,654
    
    
    
    7.3
    %
    
    
    40,413,844
    
    
    
    4.0
    %
  89




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 16. Related Parties
  17. Income Taxes
  2007
    
    
    2006
    
    
    2005As Restated
    
    
    As RestatedCurrent tax expense
    
    $
    4,181,281
    
    
    $
    3,826,638
    
    
    $
    4,332,516Deferred tax (benefit) expense
    
    
    (325,232
    )
    
    
    (325,702
    )
    
    
    (421,841
    )$
    3,856,049
    
    
    $
    3,500,936
    
    
    $
    3,910,675
  90




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 17. Income Taxes (continued)
  2007
    
    
    2006
    
    
    2005As Restated
    
    
    As RestatedIncome before provision for income tax
    
    $
    11,746,598
    
    
    $
    10,485,725
    
    
    $
    10,140,842Tax expense at federal statutory rate
    
    $
    3,993,843
    
    
    $
    3,565,147
    
    
    $
    3,447,886Increase (decrease) in taxes resulting from:State income taxes
    
    
    603,148
    
    
    
    531,825
    
    
    
    529,108Tax-exempt interest
    
    
    (558,033
    )
    
    
    (522,521
    )
    
    
    (135,688
    )Other
    
    
    (182,909
    )
    
    
    (73,515
    )
    
    
    69,369$
    3,856,049
    
    
    $
    3,500,936
    
    
    $
    3,910,675Effective tax rate
    
    
    32.83
    %
    
    
    33.39
    %
    
    
    38.56
    %
   91




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 17. Income Taxes (continued)
  2007
    
    
    2006Deferred tax assets:Allowance for loan losses
    
    $
    3,744,220
    
    
    $
    3,372,038Other
    
    
    1,162,937
    
    
    
    1,551,002Total deferred tax assets
    
    
    4,907,157
    
    
    
    4,923,040Deferred tax liability:Mortgage servicing rights
    
    
    (533,937
    )
    
    
    (525,467
    )Other
    
    
    (301,630
    )
    
    
    Total deferred tax liabilities
    
    
    (835,567
    )
    
    
    (525,467
    )Net deferred tax assets
    
    $
    4,071,590
    
    
    $
    4,397,573
 18. Commitments and Contingencies
  2007
    
    
    2006Commercial credit lines
    
    $
    225,519,668
    
    
    $
    201,846,125Revolving home equity and credit card lines
    
    
    93,315,941
    
    
    
    91,072,318Standby letters of credit
    
    
    17,039,672
    
    
    
    13,556,888Other loans
    
    
    2,394,328
    
    
    
    2,382,635$
    338,269,609
    
    
    $
    308,857,966
    92




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 18. Commitments and Contingencies (continued)
   19. Fair Value of Financial Instruments
 Disclosures about Fair Value of Financial Instruments
  Cash and short-term investments
 Investment securities (including collateralized mortgage obligations)
  93




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 19. Fair Value of Financial Instruments (continued)
 Loans receivable
 Federal Reserve and FHLB stock:
 Deposits
 Security repurchase agreements
 FHLB advances:
 Subordinated debt:
 Junior subordinated debt
 Interest rate swap
 Off-balance-sheet instruments
  94




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 19. Fair Value of Financial Instruments (continued)
  2007
    
    
    2006Carrying
    
    
    Fair
    
    
    Carrying
    
    
    FairAmount
    
    
    Value
    
    
    Amount
    
    
    ValueAssetsCash and due from banks
    
    $
    41,966,169
    
    
    $
    41,966,169
    
    
    $
    71,227,890
    
    
    $
    71,227,890Federal funds sold
    
    
    39,356,700
    
    
    
    39,356,700
    
    
    
    39,648,321
    
    
    
    39,648,321Reverse repurchase
agreements
    
    
    81,000,000
    
    
    
    81,000,000
    
    
    
    1,000,000
    
    
    
    1,000,000Investment securities
available-for-sale
    
    
    62,267,910
    
    
    
    62,267,910
    
    
    
    60,790,222
    
    
    
    60,790,222Investment securities
held-to-maturity
    
    
    71,755,912
    
    
    
    72,034,922
    
    
    
    86,197,233
    
    
    
    85,279,591Net loans
    
    
    820,875,610
    
    
    
    828,271,948
    
    
    
    736,024,836
    
    
    
    731,243,332Federal Reserve and
FHLB stock
    
    
    3,149,900
    
    
    
    3,149,900
    
    
    
    3,149,900
    
    
    
    3,149,900LiabilitiesDeposits
    
    
    1,004,762,029
    
    
    
    1,003,773,371
    
    
    
    875,083,633
    
    
    
    872,555,051Security repurchase
agreements
    
    
    58,475,789
    
    
    
    58,475,789
    
    
    
    59,133,328
    
    
    
    59,133,328FHLB advances
    
    
    3,000,000
    
    
    
    3,029,585
    
    
    
    14,000,000
    
    
    
    13,973,879Subordinated debt
    
    
    5,000,000
    
    
    
    5,416,762
    
    
    
    5,000,000
    
    
    
    5,000,000Junior subordinated
debentures
    
    
    13,918,000
    
    
    
    16,156,710
    
    
    
    13,918,000
    
    
    
    17,223,525Interest rate swap
    
    
    
    
    
    
    
    
    
    
    160,795
    
    
    
    160,795
  95




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 20. Shareholders Equity
  2007
    
    
    2006
    
    
    2005Accumulated unrealized loss on securities
available-for-sale at January 1, net of
tax
    
    $
    (435,879
    )
    
    $
    (922,349
    )
    
    $
    (401,367
    )Net unrealized gain (loss) for period
    
    
    1,483,272
    
    
    
    805,547
    
    
    
    (862,696
    )Tax benefit (expense)
    
    
    (587,524
    )
    
    
    (319,077
    )
    
    
    341,714Ending other comprehensive gain (loss) at
December 31, net of tax
    
    $
    459,869
    
    
    $
    (435,879
    )
    
    $
    (922,349
    )Accumulated unrealized loss on swap at
January 1, net of tax
    
    $
    (97,104
    )
    
    $
    (324,235
    )
    
    $
    (228,156
    )Net unrealized gain (loss) for period
    
    
    160,795
    
    
    
    376,107
    
    
    
    (159,098
    )Tax benefit (expense)
    
    
    (63,691
    )
    
    
    (148,976
    )
    
    
    63,019Ending other comprehensive loss at
December 31, net of tax
    
    $
    
    
    
    $
    (97,104
    )
    
    $
    (324,235
    )Accumulated other comprehensive loss at
January 1, net of tax
    
    $
    (532,983
    )
    
    $
    (1,246,584
    )
    
    $
    (629,523
    )Other comprehensive gain (loss), net of tax
    
    
    992,852
    
    
    
    713,601
    
    
    
    (617,061
    )Accumulated other comprehensive gain
(loss) at December 31, net of tax
    
    $
    459,869
    
    
    $
    (532,983
    )
    
    $
    (1,246,584
    )
  96




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 21. Earnings Per Share
  2007
    
    
    2006
    
    
    2005As Restated
    
    
    As RestatedBasic EPS calculationBasic average shares outstanding
    
    
    2,327,878
    
    
    
    2,301,983
    
    
    
    2,298,593Net income
    
    $
    7,890,549
    
    
    $
    6,984,789
    
    
    $
    6,230,167Basic earnings per common share
    
    $
    3.39
    
    
    $
    3.03
    
    
    $
    2.71Diluted EPS calculationAverage shares outstanding
    
    
    2,327,878
    
    
    
    2,301,983
    
    
    
    2,298,593Nonvested restricted stock
    
    
    12,574
    
    
    
    25,903
    
    
    
    26,820Net effect of the assumed exercise of stock options
    
    
    69,833
    
    
    
    78,098
    
    
    
    62,025Diluted average shares
    
    
    2,410,285
    
    
    
    2,405,984
    
    
    
    2,387,438Net income
    
    $
    7,890,549
    
    
    $
    6,984,789
    
    
    $
    6,230,167Diluted earnings per common share
    
    $
    3.27
    
    
    $
    2.90
    
    
    $
    2.61
  97




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 22. Parent Company Financial Statements
  Balance Sheet
 December 312007
    
    
    2006AssetsCash
    
    $
    1,524,928
    
    
    $
    1,708,579Investment in subsidiary
    
    
    80,297,106
    
    
    
    70,917,555Other assets
    
    
    1,744,169
    
    
    
    1,565,389Total assets
    
    $
    83,566,203
    
    
    $
    74,191,523Liabilities and shareholders equityOther liabilities
    
    $
    710,197
    
    
    $
    488,692Junior subordinated debentures owed to
unconsolidated subsidiary trust
    
    
    13,918,000
    
    
    
    13,918,000Total liabilities
    
    
    14,628,197
    
    
    
    14,406,692Shareholders equity
    
    
    68,938,006
    
    
    
    59,784,831Total liabilities and shareholders equity
    
    $
    83,566,203
    
    
    $
    74,191,523
  98




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 22. Parent Company Financial Statements (continued)
 Statements of Income
 Year Ended December 312007
    
    
    2006
    
    
    2005As Restated
    
    
    As RestatedInterest income
    
    $
    34,691
    
    
    $
    42,953
    
    
    $
    32,879Interest expense
    
    
    1,481,523
    
    
    
    1,487,982
    
    
    
    1,487,982Net interest income
    
    
    (1,446,832
    )
    
    
    (1,445,029
    )
    
    
    (1,455,103
    )Other income
    
    
    44,308
    
    
    
    44,308
    
    
    
    44,308Dividend income from subsidiary
    
    
    1,300,000
    
    
    
    1,300,000
    
    
    
    1,300,000Other operating expenses:Compensation expense
related to restricted stock
and options
    
    
    1,208,947
    
    
    
    771,177
    
    
    
    Unearned compensation
amortization
    
    
    
    
    
    
    
    
    
    
    257,227Other expenses
    
    
    345,906
    
    
    
    317,559
    
    
    
    334,703Total other operating expenses
    
    
    1,554,853
    
    
    
    1,088,736
    
    
    
    591,930Net loss before tax benefit
and equity in undistributed
net income of subsidiary
    
    
    (1,657,377
    )
    
    
    (1,189,457
    )
    
    
    (702,725
    )Tax benefit
    
    
    1,161,227
    
    
    
    974,934
    
    
    
    781,828Net loss before equity in
undistributed net income of
subsidiary
    
    
    (496,150
    )
    
    
    (214,523
    )
    
    
    79,103Equity in undistributed net
income of subsidiary
    
    
    8,386,699
    
    
    
    7,199,312
    
    
    
    6,151,064Net income
    
    $
    7,890,549
    
    
    $
    6,984,789
    
    
    $
    6,230,167
  99




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 22. Parent Company Financial Statements (continued)
 Statements of Cash Flows
 Year Ended December 312007
    
    
    2006
    
    
    2005As Restated
    
    
    As RestatedOperating activitiesNet income
    
    $
    7,890,549
    
    
    $
    6,984,789
    
    
    $
    6,230,167Adjustments to reconcile net income to net cash
provided by operating activities:Undistributed net income of subsidiary
    
    
    (8,386,699
    )
    
    
    (7,199,312
    )
    
    
    (6,151,064
    )Board stock compensation
    
    
    99,709
    
    
    
    99,786
    
    
    
    99,793Unearned compensation amortization
    
    
    
    
    
    
    
    
    
    
    257,227Excess tax benefit from deferred compensation
    
    
    (551,616
    )
    
    
    (559,260
    )
    
    
    205,009Compensation expense related to restricted
stock and options
    
    
    1,208,947
    
    
    
    771,177
    
    
    
    Net increase in deferred income tax asset
    
    
    (147,971
    )
    
    
    (184,276
    )
    
    
    (58,994
    )(Increase) decrease in other assets
    
    
    (30,809
    )
    
    
    (30,808
    )
    
    
    5,633Increase (decrease) in other liabilities
    
    
    773,121
    
    
    
    322,139
    
    
    
    (29,410
    )Net cash provided by operating activities
    
    
    855,231
    
    
    
    204,235
    
    
    
    558,361Investing activitiesNet cash provided by investing activities
    
    
    
    
    
    
    
    
    
    
    Financing activitiesProceeds from issuance of stock
    
    
    803,905
    
    
    
    1,010,064
    
    
    
    556,922Repurchase of stock
    
    
    (2,394,403
    )
    
    
    (1,936,368
    )
    
    
    (1,693,222
    )Income tax benefit from exercise of options (FASB
No. 123 (R))
    
    
    551,616
    
    
    
    559,260
    
    
    
    Net cash used in financing activities
    
    
    (1,038,882
    )
    
    
    (367,044
    )
    
    
    (1,136,300
    )Decrease in cash and cash equivalents
    
    
    (183,651
    )
    
    
    (162,809
    )
    
    
    (577,939
    )Cash and cash equivalents at beginning of year
    
    
    1,708,579
    
    
    
    1,871,388
    
    
    
    2,449,327Cash and cash equivalents at end of year
    
    $
    1,524,928
    
    
    $
    1,708,579
    
    
    $
    1,871,388
  100




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 23. Quarterly Results of Operations (Unaudited)
  March 31
    
    
    June 30
    
    
    September 30As Restated
    
    
    As Restated
    
    
    As Restated
    
    
    December 312007Interest income
    
    $
    16,352,337
    
    
    $
    17,427,517
    
    
    $
    17,597,131
    
    
    $
    17,502,698Interest expense
    
    
    8,380,403
    
    
    
    9,137,701
    
    
    
    9,075,944
    
    
    
    8,668,583Net interest income
    
    
    7,971,934
    
    
    
    8,289,816
    
    
    
    8,521,187
    
    
    
    8,834,115Provision for loan losses
    
    
    225,000
    
    
    
    225,000
    
    
    
    79,000
    
    
    
    375,000Other operating income
    
    
    2,180,974
    
    
    
    2,628,106
    
    
    
    2,473,580
    
    
    
    2,742,665Other operating expense
    
    
    7,317,051
    
    
    
    7,408,397
    
    
    
    8,098,670
    
    
    
    8,167,661Net income before tax
    
    
    2,610,857
    
    
    
    3,284,525
    
    
    
    2,817,097
    
    
    
    3,034,119Federal and state income tax
    
    
    842,097
    
    
    
    1,070,309
    
    
    
    941,143
    
    
    
    1,002,500Net income after tax
    
    $
    1,768,760
    
    
    $
    2,214,216
    
    
    $
    1,875,954
    
    
    $
    2,031,619Basic earnings per share
    
    $
    0.76
    
    
    $
    0.95
    
    
    $
    0.80
    
    
    $
    0.88Diluted earnings per share
    
    $
    0.73
    
    
    $
    0.92
    
    
    $
    0.78
    
    
    $
    0.84
 March 31
    
    
    June 30
    
    
    September 30As Restated
    
    

As Restated
    
    

As Restated
    
    

December 312006Interest income
    
    $
    14,147,249
    
    
    $
    14,950,359
    
    
    $
    15,995,312
    
    
    $
    16,282,291Interest expense
    
    
    6,535,800
    
    
    
    6,995,692
    
    
    
    7,827,143
    
    
    
    8,205,883Net interest income
    
    
    7,611,449
    
    
    
    7,954,667
    
    
    
    8,168,169
    
    
    
    8,076,408Provision for loan losses
    
    
    411,000
    
    
    
    225,000
    
    
    
    225,000
    
    
    
    225,000Other operating income
    
    
    1,888,115
    
    
    
    2,103,080
    
    
    
    2,095,903
    
    
    
    2,272,428Other operating expense
    
    
    6,784,720
    
    
    
    7,018,275
    
    
    
    7,476,479
    
    
    
    7,319,020Net income before tax
    
    
    2,303,844
    
    
    
    2,814,472
    
    
    
    2,562,593
    
    
    
    2,804,816Federal and state income tax
    
    
    793,335
    
    
    
    974,457
    
    
    
    807,946
    
    
    
    925,198Net income after tax
    
    $
    1,510,509
    
    
    $
    1,840,015
    
    
    $
    1,754,647
    
    
    $
    1,879,618Basic earnings per share
    
    $
    0.66
    
    
    $
    0.80
    
    
    $
    0.76
    
    
    $
    0.81Diluted earnings per share
    
    $
    0.63
    
    
    $
    0.76
    
    
    $
    0.73
    
    
    $
    0.78
  101




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The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 23. Quarterly Results of Operations (Unaudited) (continued)
  March 31
    
    
    March 31
    
    
    June 30
    
    
    June 30
    
    
    September 30
    
    
    September 30As Reported
    
    
    As Restated
    
    
    As Reported
    
    
    As Restated
    
    
    As Reported
    
    
    As Restated2007Interest income
    
    $
    16,364,240
    
    
    $
    16,352,337
    
    
    $
    17,480,291
    
    
    $
    17,427,517
    
    
    $
    17,708,201
    
    
    $
    17,597,131Interest expense
    
    
    8,380,403
    
    
    
    8,380,403
    
    
    
    9,137,701
    
    
    
    9,137,701
    
    
    
    9,075,944
    
    
    
    9,075,944Net interest income
    
    
    7,983,837
    
    
    
    7,971,934
    
    
    
    8,342,590
    
    
    
    8,289,816
    
    
    
    8,632,257
    
    
    
    8,521,187Provision for loan
losses
    
    
    225,000
    
    
    
    225,000
    
    
    
    225,000
    
    
    
    225,000
    
    
    
    79,000
    
    
    
    79,000Other operating
income
    
    
    2,180,974
    
    
    
    2,180,974
    
    
    
    2,628,106
    
    
    
    2,628,106
    
    
    
    2,473,580
    
    
    
    2,473,580Other operating
expense
    
    
    7,486,634
    
    
    
    7,317,051
    
    
    
    7,689,239
    
    
    
    7,408,397
    
    
    
    8,379,990
    
    
    
    8,098,670Net income before
tax
    
    
    2,453,177
    
    
    
    2,610,857
    
    
    
    3,056,457
    
    
    
    3,284,525
    
    
    
    2,646,847
    
    
    
    2,817,097Federal and state
income tax
    
    
    780,508
    
    
    
    842,097
    
    
    
    980,624
    
    
    
    1,070,309
    
    
    
    874,379
    
    
    
    941,143Net income after tax
    
    $
    1,672,669
    
    
    $
    1,768,760
    
    
    $
    2,075,833
    
    
    $
    2,214,216
    
    
    $
    1,772,468
    
    
    $
    1,875,954Basic earnings per
share
    
    $
    0.72
    
    
    $
    0.76
    
    
    $
    0.89
    
    
    $
    0.95
    
    
    $
    0.76
    
    
    $
    0.80Diluted earnings
per share
    
    $
    0.69
    
    
    $
    0.73
    
    
    $
    0.86
    
    
    $
    0.92
    
    
    $
    0.74
    
    
    $
    0.78
    102




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##### Table of Contents



The National Bank of Indianapolis Corporation
 Notes to Consolidated Financial Statements (Continued)
 23. Quarterly Results of Operations (Unaudited) (continued)
 March 31
    
    
    March 31
    
    
    June 30
    
    
    June 30
    
    
    September 30
    
    
    September 30As Reported
    
    
    As Restated
    
    
    As Reported
    
    
    As Restated
    
    
    As Reported
    
    
    As Restated2006Net income before tax
    
    $
    2,303,844
    
    
    $
    2,303,844
    
    
    $
    2,814,472
    
    
    $
    2,814,472
    
    
    $
    2,562,593
    
    
    $
    2,562,593Federal and state income
tax
    
    
    773,110
    
    
    
    793,335
    
    
    
    944,053
    
    
    
    974,457
    
    
    
    781,139
    
    
    
    807,946Net income after tax
    
    $
    1,530,734
    
    
    $
    1,510,509
    
    
    $
    1,870,419
    
    
    $
    1,840,015
    
    
    $
    1,781,454
    
    
    $
    1,754,647Basic earnings per share
    
    $
    0.67
    
    
    $
    0.66
    
    
    $
    0.81
    
    
    $
    0.80
    
    
    $
    0.77
    
    
    $
    0.76Diluted earnings per share
    
    $
    0.64
    
    
    $
    0.63
    
    
    $
    0.78
    
    
    $
    0.76
    
    
    $
    0.74
    
    
    $
    0.73
  103




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##### Table of Contents



Item 9. Changes in and Disagreements With Accountants on Accounting and Financial
Disclosure.
  
 Item 9A. Controls and Procedures
 Disclosure Controls and Procedures
 Managements Report on Internal Control Over Financial Reporting.
 Attestation Report of the Independent Registered Public Accounting Firm.
 Changes in Internal Controls Over Financial Reporting
   104




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Item 9B. Other Information
  
 PART III
 
 Items 10. 11, 12, 13 and 14
   105




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##### Table of Contents



Part IV
 
 Item 15. Exhibits, Financial Statement Schedules
 (a)
    
    (1) The following consolidated financial statements are included in Item 8:
 Page Number in10-KReport on Managements Assessment of Internal Control over
Financial Reporting
    
    
    51Report of Independent Registered Public Accounting Firm
on Consolidated Financial Statements
    
    
    52Consolidated Balance Sheets December 31, 2007 and 2006
    
    
    55Consolidated Statements of Income 
For the years ended December 31, 2007, 2006 and 2005
    
    
    56Consolidated Statements of Shareholders Equity
For the years ended December 31, 2007, 2006 and 2005
    
    
    57Consolidated Statements of Cash Flows 
For the years ended December 31, 2007, 2006, and 2005
    
    
    58Notes to consolidated Financial Statements
    
    
    59
 (2)
    
    See response to Item 15 (a)(1). All other financial statement
schedules have been omitted because they are not applicable, or the
required information is shown in the consolidated financial statements
or notes thereto.(3)
    
    List of Exhibits
  106




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##### Table of Contents



EXHIBIT INDEX
 3.01
    
    Articles of Incorporation of the Corporation, filed as Exhibit 3(i) to the Corporations Form
10-QSB as of September 30, 1995 are incorporated by reference and Articles of Amendment filed
as Exhibit 3(i) to the Form 10-K for the fiscal year ended
December 31, 20013.02
    
    Bylaws of the Corporation, filed as Exhibit 3(ii) to the Corporations Form 10-Q as of
September 30, 1996 are incorporated by reference10.01*
    
    1993 Key Employees Stock Option Plan of the Corporation, as amended, filed as Exhibit 10(a)
to the Form 10-K for the fiscal year ended December 31, 2004 is incorporated by reference10.02*
    
    1993 Directors Stock Option Plan of the Corporation, as amended, filed as Exhibit 10(b) to
the Corporations Form 10-Q as of June 30, 2001 is incorporated by reference10.03*
    
    1993 Restricted Stock Plan of the Corporation, as amended, filed as Exhibit 10(c) to the
Form 10-K for the fiscal year ended December 31, 2004 is incorporated by reference10.04*
    
    Form of agreement under the 1993 Key Employees Stock Option Plan, filed as Exhibit 10(d) to
the Form 10-K for the fiscal year ended December 31, 2004 is incorporated by reference10.05*
    
    Form of agreement under the 1993 Restricted Stock Plan, filed as Exhibit 10(e) to the Form
10-K for the fiscal year ended December 31, 2004 is incorporated by reference10.06*
    
    Schedule of Directors Compensation Arrangements, filed as Exhibit 10(f) to the Form 10-K for
the fiscal year ended December 31, 2004 is incorporated by reference10.07*
    
    Schedule of Named Executive Officers Compensation Arrangements, filed as Exhibit 10.07 to
the Corporations Form 8-K dated May 18, 2006 is incorporated by reference, as amended by the
Corporations Form 8-K filed January 10, 2008.10.08*
    
    The National Bank of Indianapolis Corporation 2005 Equity Incentive Plan, filed as Exhibit
10.01 to the Corporations Form 8-K dated June 22, 2005 is incorporated by reference10.09*
    
    Form of Restricted Stock Award Agreement for The National Bank of Indianapolis Corporation
2005 Equity Incentive Plan, filed as Exhibit 10.02 to the Corporations Form 8-K dated June
22, 2005 is incorporated by reference10.10*
    
    Form of Stock Option Award Agreement for The National Bank of Indianapolis Corporation 2005
Equity Incentive Plan, filed as Exhibit 10.03 to the Corporations Form 8-K dated June 22,
2005 is incorporated by reference10.11*
    
    Employment Agreement dated December 15, 2005 between
Morris L. Maurer and the Corporation, filed as Exhibit 10.06 to the
Corporations Form 8-K dated December 21, 2005 is incorporated by
reference10.12*
    
    Employment Agreement dated December 15, 2005 between Philip B. Roby and the Corporation,
filed as Exhibit 10.07 to the Corporations Form 8-K dated December 21, 2005 is incorporated
by reference10.13*
    
    The National Bank of Indianapolis Corporation Executives Deferred Compensation Plan, filed
as Exhibit 10.08 to the Corporations Form 8-K dated December 21, 2005 is incorporated by
reference10.14*
    
    The National Bank of Indianapolis Corporation 401(K) Savings Plan (as amended and restated
generally effective January 1, 2006), filed as Exhibit 10.14 to the Corporations Form 10-K
dated December 31, 2005 is incorporated by reference21.00
    
    Subsidiaries
of The National Bank of Indianapolis Corporation
  107




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##### Table of Contents



31.1
    
    Certificate of Chief Executive Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the
Securities Exchange Act of 1934, as amended31.2
    
    Certificate of Chief Financial Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the
Securities Exchange Act of 1934, as amended32.1
    
    Chief Executive Officer Certification pursuant to 18 U.S.C. Section 135032.2
    
    Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350
  108




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##### Table of Contents



In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
 (Registrant)
    
    The National Bank of Indianapolis CorporationBy (Signature and Title)
    
    /S/ Morris L. Maurer
    
    March 14, 2008Morris L. Maurer, President (Principal Executive Officer)
    
    Date
  By (Signature and Title)
    
    /S/     Morris L. Maurer

Morris L. Maurer, President (Principal Executive Officer)
    
    March 14, 2008

DateBy (Signature and Title)
    
    /S/     Philip B. Roby

Philip B. Roby, Executive Vice President
    
    March 14, 2008

DateBy (Signature and Title)
    
    /S/     Debra L. Ross

Debra L. Ross, Senior Vice President (Principal
Financial and Accounting Officer)
    
    March 14, 2008

DateBy (Signature and Title)
    
    /S/      Michael S. Maurer

Michael S. Maurer, Chairman of the Board
    
    March 14, 2008

DateBy (Signature and Title)
    
    /S/      Kathryn G. Betley

Kathryn G. Betley, Director
    
    March 14, 2008

DateBy (Signature and Title)
    
    /S/      David R. Frick

David R. Frick, Director
    
    March 14, 2008

DateBy (Signature and Title)
    
    /S/      Andre B. Lacy

Andre B. Lacy, Director
    
    March 14, 2008

DateBy (Signature and Title)
    
    /S/      William S. Oesterle

William S Oesterle, Director
    
    March 14, 2008

DateBy (Signature and Title)
    
    /S/      Todd H. Stuart

Todd H. Stuart, Director
    
    March 14, 2008

DateBy (Signature and Title)
    
    /S/      John T. Thompson

John T. Thompson, Director
    
    March 14, 2008

Date
  109




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##### Table of Contents



EXHIBIT INDEX
 3.01
    
    Articles of Incorporation of the Corporation, filed as Exhibit 3(i) to the Corporations Form
10-QSB as of September 30, 1995 are incorporated by reference and Articles of Amendment filed
as Exhibit 3(i) to the Form 10-K for the fiscal year ended
December 31, 20013.02
    
    Bylaws of the Corporation, filed as Exhibit 3(ii) to the Corporations Form 10-Q as of
September 30, 1996 are incorporated by reference10.01*
    
    1993 Key Employees Stock Option Plan of the Corporation, as amended, filed as Exhibit 10(a)
to the Form 10-K for the fiscal year ended December 31, 2004 is incorporated by reference10.02*
    
    1993 Directors Stock Option Plan of the Corporation, as amended, filed as Exhibit 10(b) to
the Corporations Form 10-Q as of June 30, 2001 is incorporated by reference10.03*
    
    1993 Restricted Stock Plan of the Corporation, as amended, filed as Exhibit 10(c) to the
Form 10-K for the fiscal year ended December 31, 2004 is incorporated by reference10.04*
    
    Form of agreement under the 1993 Key Employees Stock Option Plan, filed as Exhibit 10(d) to
the Form 10-K for the fiscal year ended December 31, 2004 is incorporated by reference10.05*
    
    Form of agreement under the 1993 Restricted Stock Plan, filed as Exhibit 10(e) to the Form
10-K for the fiscal year ended December 31, 2004 is incorporated by reference10.06*
    
    Schedule of Directors Compensation Arrangements, filed as Exhibit 10(f) to the Form 10-K for
the fiscal year ended December 31, 2004 is incorporated by reference10.07*
    
    Schedule of Named Executive Officers Compensation Arrangements, filed as Exhibit 10.07 to
the Corporations Form 8-K dated May 18, 2006 is incorporated by reference, as amended by the
Corporations Form 8-K filed January 10, 2008.10.08*
    
    The National Bank of Indianapolis Corporation 2005 Equity Incentive Plan, filed as Exhibit
10.01 to the Corporations Form 8-K dated June 22, 2005 is incorporated by reference10.09*
    
    Form of Restricted Stock Award Agreement for The National Bank of Indianapolis Corporation
2005 Equity Incentive Plan, filed as Exhibit 10.02 to the Corporations Form 8-K dated June
22, 2005 is incorporated by reference10.10*
    
    Form of Stock Option Award Agreement for The National Bank of Indianapolis Corporation 2005
Equity Incentive Plan, filed as Exhibit 10.03 to the Corporations Form 8-K dated June 22,
2005 is incorporated by reference10.11*
    
    Employment Agreement dated December 15, 2005 between
Morris L. Maurer and the Corporation, filed as Exhibit 10.06 to the
Corporations Form 8-K dated December 21, 2005 is incorporated by
reference10.12*
    
    Employment Agreement dated December 15, 2005 between Philip B. Roby and the Corporation,
filed as Exhibit 10.07 to the Corporations Form 8-K dated December 21, 2005 is incorporated
by reference10.13*
    
    The National Bank of Indianapolis Corporation Executives Deferred Compensation Plan, filed
as Exhibit 10.08 to the Corporations Form 8-K dated December 21, 2005 is incorporated by
reference10.14*
    
    The National Bank of Indianapolis Corporation 401(K) Savings Plan (as amended and restated
generally effective January 1, 2006), filed as Exhibit 10.14 to the Corporations Form 10-K
dated December 31, 2005 is incorporated by reference21.00
    
    Subsidiaries
of The National Bank of Indianapolis Corporation
  110




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##### Table of Contents



31.1
    
    Certificate of Chief Executive Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the
Securities Exchange Act of 1934, as amended31.2
    
    Certificate of Chief Financial Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the
Securities Exchange Act of 1934, as amended32.1
    
    Chief Executive Officer Certification pursuant to 18 U.S.C. Section 135032.2
    
    Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350
  111