<SUBMISSION>
<ACCESSION-NUMBER>0001002105-05-000069
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>3
<PERIOD>20050421
<ITEMS>2.02
<ITEMS>9.01
<FILING-DATE>20050421
<DATE-OF-FILING-DATE-CHANGE>20050421
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>FIRST NATIONAL CORP /VA/
<CIK>0000719402
<ASSIGNED-SIC>6022
<IRS-NUMBER>541231965
<STATE-OF-INCORPORATION>VA
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>000-23976
<FILM-NUMBER>05764035
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>100 WEST KING STREET
<CITY>STRASBURG
<STATE>VA
<ZIP>22657
<PHONE>7034659121
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>100 WEST KING STREET
<CITY>STRASBURG
<STATE>VA
<ZIP>22657
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>fncform8k.htm
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
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<TITLE>FIRST NATIONAL CORPORATION</TITLE>
<META NAME="author" CONTENT="sbell">
<META NAME="date" CONTENT="04/21/2005">
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>==========================================================================</P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>UNITED STATES</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>SECURITIES AND EXCHANGE COMMISSION</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>Washington, D.C. &nbsp;20549</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>___________</P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>FORM 8-K</B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>CURRENT REPORT</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934</B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>Date of Report (Date of earliest event reported): <B>April 21, 2005</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>___________</P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>FIRST NATIONAL CORPORATION</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>(Exact name of registrant as specified in its charter)</P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD valign=top width=193><P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>Virginia</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>(State or other jurisdiction</P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>of incorporation)</P>
</TD><TD valign=top width=192 colspan=2><P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>0-23976</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>(Commission File Number)</P>
</TD><TD valign=top width=192><P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>54-1232965</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>(IRS Employer</P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>Identification No.)</P>
</TD></TR>
<TR><TD valign=top width=193>&nbsp;</TD><TD valign=top width=192 colspan=2>&nbsp;</TD><TD valign=top width=192>&nbsp;</TD></TR>
<TR><TD valign=top width=289 colspan=2><P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>112 West King Street</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>Strasburg, Virginia</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>(Address of principal executive offices)</P>
</TD><TD valign=top width=288 colspan=2><P style="margin:0pt; font-family:Times New Roman; font-size:12pt" align=center><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>22657</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>(Zip Code)</P>
</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>Registrant&#146;s telephone number, including area code: <B>(540) 465-9121</B></P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>Not Applicable</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>(Former name or former address, if changed since last report)</P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:</P>
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<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><img src="ballot.jpg"></P>
<P style="margin:0pt; text-indent:18pt; line-height:14pt; font-family:Batang; font-size:12pt"><FONT FACE="Times New Roman">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</FONT></P>
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<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><img src="ballot.jpg"></P>
<P style="margin:0pt; text-indent:18pt; line-height:14pt; font-family:Batang; font-size:12pt"><FONT FACE="Times New Roman">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</FONT></P>
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<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><img src="ballot.jpg"></P>
<P style="margin:0pt; text-indent:18pt; line-height:14pt; font-family:Batang; font-size:12pt"><FONT FACE="Times New Roman">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</FONT></P>
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<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><img src="ballot.jpg"></P>
<P style="margin:0pt; text-indent:18pt; line-height:14pt; font-family:Batang; font-size:12pt"><FONT FACE="Times New Roman">Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</FONT></P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center>==========================================================================</P>
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<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B>Item 2.02</B></P>
<P style="margin:0pt; text-indent:72pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B>Results of Operations and Financial Condition.</B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<P style="margin:0pt; text-indent:36pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">On April 21, 2005, the Registrant issued a press release reporting its financial results for the period ended March 31, 2005. &nbsp;A copy of the press release is being furnished as an exhibit to this report and is incorporated by reference into this Item 2.02.</P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
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<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B>Item 9.01</B></P>
<P style="margin:0pt; text-indent:72pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B>Financial Statements and Exhibits.</B></P>
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<P style="margin-top:0pt; margin-bottom:-14pt; text-indent:36pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">(c)</P>
<P style="margin:0pt; text-indent:72pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">Exhibits. &nbsp;The following exhibit is being furnished pursuant to Item 2.02 above. &nbsp;</P>
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<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:36pt; text-indent:36pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B><U>Exhibit No.</U></B></P>
<P style="margin:0pt; padding-left:36pt; text-indent:108pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B><U>Description</U></B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:-14pt; padding-left:36pt; text-indent:36pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">99.1</P>
<P style="margin:0pt; padding-left:36pt; text-indent:108pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">Press Release dated April 21, 2005</P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>SIGNATURES</B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<P style="margin:0pt; text-indent:36pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.</P>
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<P style="margin:0pt; padding-left:216pt; text-indent:36pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B>FIRST NATIONAL CORPORATION </B></P>
<P style="margin:0pt; padding-left:216pt; text-indent:36pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">&nbsp;&nbsp;&nbsp;(Registrant)</P>
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<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">Date: &nbsp;April 21, 2005</P>
<P style="margin:0pt; text-indent:252pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">By:&nbsp;&nbsp;<U>/s/ M. Shane Bell</U></P>
<P style="margin:0pt; padding-left:279pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">M. Shane Bell </P>
<P style="margin:0pt; padding-left:279pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">Executive Vice President </P>
<P style="margin:0pt; padding-left:279pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">and Chief Financial Officer</P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=center><B>EXHIBIT INDEX</B></P>
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<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><U>Exhibit No.</U></P>
<P style="margin:0pt; text-indent:108pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><U>Description</U></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:-14pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">99.1</P>
<P style="margin:0pt; text-indent:108pt; line-height:14pt; font-family:Times New Roman; font-size:12pt">Press Release dated April 21, 2005</P>
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<TITLE>EXHIBIT 99</TITLE>
<META NAME="author" CONTENT="Michele Rundstrom">
<META NAME="date" CONTENT="04/21/2005">
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt" align=right><B>EXHIBIT 99.1</B></P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt" align=center>FIRST NATIONAL CORPORATION</P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt" align=center>Earnings Release</P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt" align=center>First Quarter Ended March 31, 2005</P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt" align=center>April 21, 2005</P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">First National
Corporation (OTCBB: FXNC) reported net income of $985 thousand or $0.67 per basic and diluted share
 for the quarter ended March 31, 2005. &nbsp;This is a 9.8% increase over the $897 thousand in net
income or $0.61 per basic and diluted share for the quarter ended&nbsp;March 31, 2004. &nbsp;The
annualized return on average equity and average assets were 15.15% and 0.96%, respectively, for
 the&nbsp;quarter ended March 31, 2005, compared to 15.01% and 1.02%, respectively, for the&nbsp;quarter
 ended March 31, 2004. Harry S. Smith, President &amp; CEO of First National Corporation stated, &#147;We
 are pleased with the Company&#146;s financial performance, considering increasing competition in the market
and costs associated with the addition of trust and asset management services during the quarter, when
comparing the first quarter of 2005 to the first quarter of 2004.&nbsp; In January 2005, the Trust and
Asset Management Department of First Bank actively began operations.&nbsp; Their performance during the first quarter exceeded our expectations. &nbsp;The Department is managed by a team of trust professionals with substantial experience providing trust and investment services.&#148;</P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">Net interest income increased 17.0% to $3.6 million for the quarter ended&nbsp;March 31, 2005 from $3.1 million for the same period in 2004.&nbsp;&nbsp;The increase was attributable to&nbsp;an 18.9%&nbsp;increase in average interest-earning assets over the same period. &nbsp;The net interest margin was 3.83% for the quarter ended March 31, 2005, compared to 3.86% for the same period in 2004.</P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">Noninterest
 income increased to $899 thousand for the quarter ended March 31, 2005, compared to $878 thousand
for the same period in 2004. &nbsp;Service charges on deposit accounts, which included overdraft
fees, decreased slightly to $585 thousand for the quarter&nbsp;ended March 31, 2005. &nbsp;&nbsp;This
 decrease was offset by an increase in fees for other customer services which increased 14.0% to $269
 thousand for the quarter ended March 31, 2005, compared to $236 thousand for the same period in 2004.
&nbsp;&nbsp;Fees for other customer services included ATM fees, brokerage fees, trust and asset management
fees, and gains on the sale of mortgage loans. &nbsp;Noninterest expense increased 13.3% to $2.9
million for the quarter ended March 31, 2005, compared to $2.5 million for the same period in 2004.
 &nbsp;Salaries and employee benefits increased over the comparable period in 2004 as a result of
salary increases and hiring additional employees to support business growth. &nbsp;The increase in noninterest
expense was also attributable to the addition of the Trust and Asset Management Department. &nbsp;</P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">&nbsp;</P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">Total assets increased
15.3% to $422.8 million at March 31, 2005 from $366.5 million at March 31, 2004. &nbsp;The majority of
 the asset growth occurred in the loan portfolio. &nbsp;Loans, net of the allowance for loan losses,
increased 24.9% from $266.5 million at March 31, 2004 to $332.7 million at March 31, 2005. &nbsp;The
 allowance for loan losses totaled $3.1 million or 0.91% of total loans at March 31, 2005, compared
to $2.5 million or 0.94% of total loans at March 31, 2004. &nbsp;Net charge-offs were $55 thousand
for the quarter ended March 31, 2005, compared to $182 thousand for the comparable period of 2004.
&nbsp;The loan loss provision was $245 thousand for the quarter ended March 31, 2005 and $163
thousand for the comparable period of 2004. &nbsp;The allowance for loan losses has increased over the
last year, which is primarily attributable to the growth in the loan portfolio. &nbsp;The overall
quality of the loan portfolio has improved, which is reflective in the ratio of allowance for loan losses to total loans.</P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">Total deposits increased 13.0% or $38.1 million to $330.9 million at March 31, 2005 from $292.8 million at March 31, 2004. &nbsp;The deposit mix remained consistent with prior periods as noninterest-bearing demand deposits, savings and interest-bearing demand deposits and time deposits comprised 22.1%, 41.3% and 36.6%, respectively, of total deposits at March 31, 2005, compared to 21.5%, 39.8% and 38.7% for the same period in 2004. &nbsp;Other borrowings totaled $45.2 million at March 31, 2005, compared to $44.5 million at March 31, 2004.</P>
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<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">Shareholders&#146; equity totaled $26.2 million at March 31, 2005, an increase of 7.8% over the March 31, 2004 balance of $24.3 million. &nbsp;The book value of the Corporation was $17.95 per share and total common shares outstanding were 1,462,062 at March 31, 2005. &nbsp;Cash dividends paid during the quarter ended March 31, 2005 and 2004 were $0.22 per share and $0.20 per share, respectively. &nbsp;As announced earlier, the Corporation declared a two-for-one stock split on March 16, 2005 with respect to shares of its common stock payable on April 29, 2005 to shareholders of record as of March 30, 2005.</P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">Certain information in this discussion may include forward looking statements that are subject to risks and uncertainties. &nbsp;These forward looking statements include statements regarding our profitability, liquidity, allowance for loan losses, interest rate sensitivity, market risk, growth strategy, and financial and other goals. &nbsp;The words &#147;believes,&#148; &#147;expects,&#148; &#147;may,&#148; &#147;will,&#148; &#147;should,&#148; &#147;projects,&#148; &#147;contemplates,&#148; &#147;anticipates,&#148; &#147;forecasts,&#148; &#147;intends,&#148; or other similar words or terms are intended to identify forward looking statements.</P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">These forward looking statements are subject to significant uncertainties because they are based upon or are affected by certain factors. &nbsp;We have identified factors in our Annual Report on Form 10-K for the year ended December 31, 2004, which can be accessed from our website at <FONT COLOR=#0000FF><U>www.firstbank-va.com</U></FONT>.</P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">Because of these uncertainties, our actual future results may be materially different from the results indicated by these forward looking statements. &nbsp;In addition, our past results of operations do not necessarily indicate our future results.</P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">First National Corporation, headquartered in Strasburg, Virginia, is the financial holding company of First Bank. First Bank operates nine retail bank branches in the northern Shenandoah Valley region of Virginia, including Shenandoah County, Warren County, Frederick County and the City of Winchester. &nbsp;First Bank also owns First Bank Financial Services, Inc., which invests in partnerships that provide investment services and title insurance.</P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:-16pt; line-height:16pt; font-family:Times New Roman; font-size:11pt">Contacts:</P>
<P style="margin-top:0pt; margin-bottom:-16pt; text-indent:72pt; line-height:16pt; font-family:Times New Roman; font-size:11pt">Harry S. Smith</P>
<P style="margin:0pt; text-indent:252pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">M. Shane Bell</P>
<P style="margin-top:0pt; margin-bottom:-16pt; padding-left:36pt; text-indent:36pt; line-height:16pt; font-family:Times New Roman; font-size:11pt">President &amp; CEO</P>
<P style="margin:0pt; padding-left:36pt; text-indent:216pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">Executive Vice President &amp; CFO</P>
<P style="margin-top:0pt; margin-bottom:-16pt; padding-left:36pt; text-indent:36pt; line-height:16pt; font-family:Times New Roman; font-size:11pt">hsmith@firstbank-va.com</P>
<P style="margin:0pt; padding-left:36pt; text-indent:216pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">sbell@firstbank-va.com</P>
<P style="margin-top:0pt; margin-bottom:-16pt; padding-left:36pt; text-indent:36pt; line-height:16pt; font-family:Times New Roman; font-size:11pt">(540) 465-9121</P>
<P style="margin:0pt; padding-left:36pt; text-indent:216pt; line-height:14pt; font-family:Times New Roman; font-size:11pt">(540) 465-9121</P>
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<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>QUARTERLY PERFORMANCE SUMMARY</B></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>First National Corporation (OTCBB: FXNC)</B></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>(in thousands, except per share data)</B></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=right><B>&nbsp;</B></P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=167.2 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B>For the Quarter Ended</B></P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">INCOME STATEMENT&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=right><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><B><U>3/31/2005&nbsp;</U></B></P>
</TD><TD valign=top width=83.2><P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=right><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><B><U>3/31/2004&nbsp;</U></B></P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Interest and dividend income&nbsp;</P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Interest and fees on loans&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5,131&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4,081&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Interest on federal funds sold&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>7&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>2&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Interest on deposits in banks&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>16&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>5&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Interest and dividends on securities available for sale:&nbsp;</P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;&nbsp;&nbsp;Taxable interest&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>496&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>587&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;&nbsp;&nbsp;Nontaxable interest&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>106&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>100&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;&nbsp;&nbsp;Dividends&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>31&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>17&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Total interest and dividend income&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5,787&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4,792&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Interest expense&nbsp;</P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Interest on deposits&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,449&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,160&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Interest on federal funds purchased&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>27&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>14&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Interest on company obligated mandatorily redeemable securities&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>108&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>34&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Interest on other borrowings&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;564&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>&nbsp;&nbsp;&nbsp;475&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Total interest expense&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,148&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,683&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Net interest income&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,639&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,109&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Provision for loan losses&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;245&nbsp;</U></P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>163&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Net interest income after provision for loan losses&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,394&nbsp;</U></P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,946&nbsp;</U></P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Noninterest income&nbsp;</P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Service charges&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;585&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;633&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Fees for other customer services&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>269&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>236&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;(Losses) on sale of premises and equipment&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>--&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>(6)</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Gains on sale of loans&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>56&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>25&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Other&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>(11)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>&nbsp;(10)</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Total noninterest income&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;899&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;878&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Noninterest expense&nbsp;</P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Salaries and employee benefits&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,525&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,203&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Occupancy&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>175&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>179&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Equipment&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>222&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>211&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Advertising&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>76&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>96&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Stationery and supplies&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>104&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>95&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Telecommunications&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>51&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>65&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Other&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>&nbsp;&nbsp;705&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>674&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Total noninterest expense&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,858&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,523&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Income before income taxes&nbsp;</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,435&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,301&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Provision for income taxes&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>450&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>404&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Net income&nbsp;</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;985&nbsp;</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;897&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
</TABLE>
<BR>
<BR>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Times New Roman; font-size:9pt; color:#FF0000" align=right><BR></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<BR>
<BR>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=439.2><P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt"><B>QUARTERLY PERFORMANCE SUMMARY</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt"><B>First National Corporation (OTCBB: FXNC)</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt"><I>(in thousands, except per share data)</I></P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=167.2 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B>For the Quarter Ended</B></P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84><P style="margin:0pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B><U>3/31/2005</U></B></P>
</TD><TD valign=top width=83.2><P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=center><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B><U>3/31/2004</U></B></P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>SHARE AND PER SHARE DATA</B></P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Net income, basic and diluted</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.67&nbsp;</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.61</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Shares outstanding at period end</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>1,462,062</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>1,462,062</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Weighted average shares, basic and diluted</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>1,462,062</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>1,462,062</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Book value at period end</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.95</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.65</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Cash dividends</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.22</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.20</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>KEY PERFORMANCE RATIOS</B></P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Return on average assets</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>0.96%</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>1.02%</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Return on average equity</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>15.15%</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>15.01%</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Net interest margin</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>3.83%</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>3.86%</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; font-family:Times New Roman; font-size:11pt">Efficiency ratio <SMALL>(1)</SMALL></P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>61.98%</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>62.20%</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>ASSET QUALITY</B></P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Loan charge-offs</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;115</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;188</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Loan recoveries</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>60</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>6</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Net charge-offs</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>55</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>182</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Nonaccrual loans</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>291</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>436</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Nonperforming loans</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>291</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>436</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Repossessed assets</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>77</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>212</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>BALANCE SHEET</B></P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Cash and due from banks</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6,692</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8,143 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Federal funds sold</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>--</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>5,165</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Interest-bearing deposits in banks</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>765</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>450</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Securities available for sale, at fair value</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>64,675</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>69,229</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Loans held for sale</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>400</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>956</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Loans, net of allowance for loan losses</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>332,720</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>266,485</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Premises and equipment, net</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>12,221</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>11,497</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Interest receivable</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>1,425</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>1,413</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Other assets</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,855</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,280</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Total assets</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;422,753</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;366,618</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Noninterest-bearing demand deposits</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;73,230</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;63,033</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Savings and interest-bearing demand deposits</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>136,648</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>116,463</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Time deposits</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;120,980</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;113,266</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Total deposits</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;330,858</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;292,762</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Federal funds purchased</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;10,036</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;--</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Other borrowings</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>45,236</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>44,542</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Company obligated mandatorily redeemable capital securities</P>
</TD><TD valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>8,248</P>
</TD><TD valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>3,093</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Accrued expenses and other liabilities</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,127</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,879</P>
</TD></TR>
<TR><TD valign=top width=439.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Total liabilities</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;396,505</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=83.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;342,276</P>
</TD></TR>
<TR><TD valign=top width=439.2>&nbsp;</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=83.2>&nbsp;</TD></TR>
</TABLE>
<BR>
<BR>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Times New Roman; font-size:9pt; color:#FF0000" align=right><BR></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<BR>
<BR>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=415.2><P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt"><B>QUARTERLY PERFORMANCE SUMMARY</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt"><B>First National Corporation (OTCBB: FXNC)</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:11pt"><I>(in thousands, except per share data)</I></P>
</TD><TD valign=top width=84>&nbsp;</TD><TD valign=top width=108 colspan=2>&nbsp;</TD></TR>
<TR><TD valign=top width=415.2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=192 colspan=3><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B>For the Quarter Ended</B></P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>BALANCE SHEET (CONT&#146;D)</B></P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; font-family:Times New Roman; font-size:11pt"><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B><U>3/31/2005</U></B></P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=center><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=center><B><U>3/31/2004</U></B></P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Common stock</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,655</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,655</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Surplus</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>1,465</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>1,465</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Retained earnings</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>21,350</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>18,285</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Accumulated other comprehensive income (loss), net</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(222)</U></P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;937</U></P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Total shareholders&#146; equity</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26,248</U></P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24,342</U></P>
</TD></TR>
<TR><TD valign=top width=415.2>&nbsp;</TD><TD valign=top width=96 colspan=2>&nbsp;</TD><TD valign=top width=96>&nbsp;</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Total liabilities and shareholders&#146; equity</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;422,753</U></P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;366,618</U></P>
</TD></TR>
<TR><TD valign=top width=415.2>&nbsp;</TD><TD valign=top width=96 colspan=2>&nbsp;</TD><TD valign=top width=96>&nbsp;</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><I>Average balances</I></P>
</TD><TD valign=top width=96 colspan=2>&nbsp;</TD><TD valign=top width=96>&nbsp;</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Total assets</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;416,288</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;352,523</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Total shareholders&#146; equity</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26,369</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24,030</P>
</TD></TR>
<TR><TD valign=top width=415.2>&nbsp;</TD><TD valign=top width=96 colspan=2>&nbsp;</TD><TD valign=top width=96>&nbsp;</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>LOAN DATA</B></P>
</TD><TD valign=top width=96 colspan=2>&nbsp;</TD><TD valign=top width=96>&nbsp;</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Mortgage loans on real estate:</P>
</TD><TD valign=top width=96 colspan=2>&nbsp;</TD><TD valign=top width=96>&nbsp;</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Construction</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;48,589</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29,829</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Secured by farm land</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>2,254</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>2,590</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Secured by 1-4 family residential</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>91,606</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>77,413</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">&nbsp;&nbsp;Other real estate loans</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>120,981</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>91,268</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Loans to farmers (except those secured by real estate)</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>721</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>359</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Commercial and industrial loans (except those secured by real estate)</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=right><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>37,939</P>
</TD><TD valign=top width=96><P style="margin:0pt; font-family:Times New Roman; font-size:11pt" align=right><BR></P>
<P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>33,057</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Consumer installment loans</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>30,579</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>32,404</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Deposit overdrafts</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>211</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>392</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">All other loans</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,906</U></P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,701</U></P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>&nbsp;&nbsp;</B>Total loans</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;335,786</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;269,013</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Allowance for loan losses</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,066</U></P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,528</U></P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Loans, net</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;332,720</U></P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right><U>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;266,485</U></P>
</TD></TR>
<TR><TD valign=top width=415.2>&nbsp;</TD><TD valign=top width=96 colspan=2>&nbsp;</TD><TD valign=top width=96>&nbsp;</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt"><B>CAPITAL RATIOS</B></P>
</TD><TD valign=top width=96 colspan=2>&nbsp;</TD><TD valign=top width=96>&nbsp;</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Tier 1 Capital</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;34,376</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26,405</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Total Capital</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>37,442</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>28,933</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Total Capital to Risk Weighted Assets</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>11.05%</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>10.23%</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Tier 1 Capital to Risk Weighted Assets</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>10.14%</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>9.34%</P>
</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt">Leverage Ratio</P>
</TD><TD valign=top width=96 colspan=2><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>8.26%</P>
</TD><TD valign=top width=96><P style="margin:0pt; line-height:13pt; font-family:Times New Roman; font-size:11pt" align=right>7.49%</P>
</TD></TR>
<TR><TD valign=top width=415.2>&nbsp;</TD><TD valign=top width=96 colspan=2>&nbsp;</TD><TD valign=top width=96>&nbsp;</TD></TR>
<TR><TD valign=top width=415.2><P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt">(1) The efficiency ratio is computed by dividing noninterest expense by the sum of net interest income on a tax equivalent basis and noninterest income excluding securities gains and losses. &nbsp;This is a non-GAAP financial measure that we believe provides investors with important information regarding operational efficiency. &nbsp;Such information is not in accordance with generally accepted accounting principles (GAAP) and should not be construed as such. &nbsp;Net interest income on a tax equivalent basis was $3,713 and $3,178 for the period ended March 31, 2005 and 2004, respectively. &nbsp;Noninterest income excluding securities gains and losses was $899 and $878 for the period ended March 31, 2005 and 2004, respectively. &nbsp;Management believes such financial information is meaningful
 to the reader in understanding operational performance, but cautions that such information not be viewed as a substitute for GAAP. </P>
</TD><TD valign=top width=96 colspan=2>&nbsp;</TD><TD valign=top width=96>&nbsp;</TD></TR>
</TABLE>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<BR>
<BR>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="page-break-before:always; margin:0pt; font-family:Times New Roman; font-size:9pt; color:#FF0000" align=right><BR></P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
<BR>
<BR>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B>FIRST NATIONAL CORPORATION</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B>Consolidated Average Balances, Yields and Rates</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><B>Three Months Ended March 31, 2005 and 2004</B></P>
<P style="margin:0pt; line-height:14pt; font-family:Times New Roman; font-size:12pt"><I>(dollars in thousands)</I></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD valign=top width=541.867 colspan=8><P style="margin:0pt; font-family:CG Times; font-size:9pt" align=justify><BR></P>
<P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Three months ended March 31,</P>
</TD></TR>
<TR><TD valign=top width=187.867>&nbsp;</TD><TD valign=top width=174.133 colspan=4><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>2005</P>
</TD><TD valign=top width=179.867 colspan=3><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>2004</P>
</TD></TR>
<TR><TD valign=top width=187.867>&nbsp;</TD><TD valign=top width=60.133>&nbsp;</TD><TD valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Interest</P>
</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Interest</P>
</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; font-family:CG Times; font-size:9pt" align=right><BR></P>
<P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">ASSETS</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Average</P>
<P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Balance</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Income/</P>
<P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Expense</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Yield/</P>
<P style="margin:0pt; font-family:CG Times; font-size:9pt" align=center>Rate (3)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Average</P>
<P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Balance</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Income/</P>
<P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Expense</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=center>Yield/</P>
<P style="margin:0pt; font-family:CG Times; font-size:9pt" align=center>Rate (3)</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">Balances at correspondent</P>
</TD><TD valign=top width=60.133>&nbsp;</TD><TD valign=top width=60 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;banks &#150; interest-bearing</P>
</TD><TD valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;908</P>
</TD><TD valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.14%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;355</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>6.04%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">Securities:</P>
</TD><TD valign=top width=60.133>&nbsp;</TD><TD valign=top width=60 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;Taxable</P>
</TD><TD valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;52,813</P>
</TD><TD valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;528</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.05%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;61,068</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>604</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.98%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;Tax-exempt (1)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10,024</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;161</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.52%</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9,247</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;152</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.60%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;Total securities</P>
</TD><TD valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;62,837</P>
</TD><TD valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>689</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.45%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;70,315</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;756</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.32%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; font-family:CG Times; font-size:9pt">Loans: (2)</P>
</TD><TD valign=top width=60.133>&nbsp;</TD><TD valign=top width=60 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;Taxable</P>
</TD><TD valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;325,472</P>
</TD><TD valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>5,092</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>6.35%&nbsp;&nbsp;</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>256,170</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>4,047</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>6.35%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;Tax-exempt (1)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,655</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;58</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>6.41%&nbsp;&nbsp;</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,320</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;51</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.24%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;Total loans</P>
</TD><TD valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;329,127</P>
</TD><TD valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5,150</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>6.35%&nbsp;&nbsp; </P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;259,490</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>4,098</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>6.35%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">Federal funds sold</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;738</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.58%</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;907</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.86%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;Total earning assets</P>
</TD><TD valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;393,610</P>
</TD><TD valign=top width=60 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5,862</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.04%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;331,067</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4,861</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>5.91%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">Less: allowance for loan losses</P>
</TD><TD valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2,951)</P>
</TD><TD valign=top width=60 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2,588)</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">Total nonearning assets</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>25,629</P>
</TD><TD valign=top width=60 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24,137</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt">&nbsp;&nbsp;&nbsp;Total assets</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=60.133><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;416,288</P>
</TD><TD valign=top width=60 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;352,616</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867>&nbsp;</TD><TD valign=top width=60.133>&nbsp;</TD><TD valign=top width=60 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=308 colspan=4><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>LIABILITIES AND SHAREHOLDERS&#146; EQUITY</P>
</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Interest-bearing deposits:</P>
</TD><TD valign=top width=66.133 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;Checking</P>
</TD><TD valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;62,267</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;248</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.61%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;&nbsp;60,775</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;182</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.20%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;Money market savings</P>
</TD><TD valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13,259</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;37</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.12%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10,982</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>16</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.59%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;Regular savings</P>
</TD><TD valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;60,962</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;244</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.62%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44,262</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;75</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.68%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;Certificates of deposit:</P>
</TD><TD valign=top width=66.133 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;&nbsp;Less than $100,000</P>
</TD><TD valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;72,799</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>554</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.09%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;69,505</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;584</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.38%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;&nbsp;Greater than $100,000</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;46,119</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;367</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.23%</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;36,941</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;303</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.30%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Total interest-bearing deposits</P>
</TD><TD valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;255,406</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,450</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.30%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;222,465</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,160</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.10%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Federal funds purchased</P>
</TD><TD valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,786</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.91%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>3,536</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.62%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Company obligated mandatorily</P>
</TD><TD valign=top width=66.133 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;redeemable capital securities</P>
</TD><TD valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8,248</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;108</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.30%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>3,093</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;34</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.44%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Other borrowings</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;49,138</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;564</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.65%</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;40,791</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;475</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.68%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Total interest-bearing liabilities</P>
</TD><TD valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;316,578</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>2,149</P>
</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.75%</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;269,885</P>
</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,683</P>
</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.51%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Noninterest-bearing liabilities</P>
</TD><TD valign=top width=66.133 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;Demand deposits</P>
</TD><TD valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;71,255</P>
</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;56,644</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;Other liabilities</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,086</P>
</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,057</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Total liabilities</P>
</TD><TD valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;389,919</P>
</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;328,586</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Shareholders&#146; equity</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26,369</P>
</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24,030</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;&nbsp;Total liabilities and</P>
</TD><TD valign=top width=66.133 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;&nbsp;&nbsp;shareholders&#146; equity</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=66.133 colspan=2><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;416,288</P>
</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;352,616</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Net interest income</P>
</TD><TD valign=top width=66.133 colspan=2>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;&nbsp;3,713</P>
</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=60><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>$ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,178</P>
</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Interest rate spread</P>
</TD><TD valign=top width=66.133 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.29%</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.40%</P>
</TD></TR>
<TR><TD valign=top width=254 colspan=3><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Interest expense as a percent of</P>
</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>&nbsp;average earning assets</P>
</TD><TD valign=top width=66.133 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.21%</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.04%</P>
</TD></TR>
<TR><TD valign=top width=187.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=justify>Net interest margin</P>
</TD><TD valign=top width=66.133 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.83%</P>
</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867><P style="margin:0pt; line-height:11pt; font-family:CG Times; font-size:9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.86%</P>
</TD></TR>
<TR><TD valign=top width=187.867>&nbsp;</TD><TD valign=top width=66.133 colspan=2>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=54>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=60>&nbsp;</TD><TD valign=top width=59.867>&nbsp;</TD></TR>
</TABLE>
<BR>
<P style="margin-top:8pt; margin-bottom:2pt; font-family:CG Times; font-size:8pt"><BR></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt">(1) Income and yields are reported on a taxable-equivalent basis assuming a federal tax rate of 34%.<FONT FACE="Book Antiqua"> The tax-equivalent adjustment was $75 thousand and $69 thousand for 2005 and 2004, respectively.</FONT></P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt">(2) Loans placed on nonaccrual status are reflected in the balances.</P>
<P style="margin:0pt; line-height:10pt; font-family:Times New Roman; font-size:8pt">(3) Annualized</P>
<P style="margin:0pt; font-family:Times New Roman; font-size:12pt"><BR></P>
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