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<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>2
<PERIOD>20020630
<FILING-DATE>20020814
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<CONFORMED-NAME>AMES NATIONAL CORP
<CIK>0001132651
<ASSIGNED-SIC>6021
<IRS-NUMBER>421039071
<STATE-OF-INCORPORATION>IA
<FISCAL-YEAR-END>1231
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<FILM-NUMBER>02738508
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<STREET1>PO BOX 846
<CITY>AMES
<STATE>IA
<ZIP>50010
<PHONE>5152326251
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<STREET1>PO BOX 846
<CITY>AMES
<STATE>IA
<ZIP>50010
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<TYPE>10-Q
<SEQUENCE>1
<FILENAME>ames10q.txt
<TEXT>
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

[Mark One]
[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 2002

[_]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

           For the transition period from ____________ to ____________

                         Commission File Number 0-32637

                            AMES NATIONAL CORPORATION
             ------------------------------------------------------
             (Exact Name of Registrant as Specified in Its Charter)

             IOWA                                              42-1039071
--------------------------------------------------------------------------------
(State or Other Jurisdiction of                            (I. R. S. Employer
Incorporation or Organization)                            Identification Number)

                                405 FIFTH STREET
                                AMES, IOWA 50010
                    ----------------------------------------
                    (Address of Principal Executive Offices)

       Registrant's Telephone Number, Including Area Code: (515) 232-6251

                                 Not Applicable

              (Former Name, Former Address and Former Fiscal Year,
                         if Changed Since Last Report)

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

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.

COMMON STOCK, $5.00 PAR VALUE                             3,128,982
--------------------------------------------------------------------------------
          (Class)                         (Shares Outstanding at August 9, 2002)

                                       1
<PAGE>


                            AMES NATIONAL CORPORATION

                                      INDEX

                                                                            Page

Part I.  Financial Information

         Item 1.  Consolidated Financial
                  Statements (Unaudited)

                  Consolidated Statements of
                  Financial Condition at June 30, 2002
                  (Unaudited) and December 31, 2001                            3

                  Consolidated Statements of
                  Income for the three and six months ended
                  June 30, 2002 and 2001 (Unaudited)                           4

                  Consolidated Statements of
                  Cash Flows for the six months ended
                  June 30, 2002 and 2001 (Unaudited)                           5

                  Notes to Consolidated Financial
                  Statements                                                   6

         Item 2.  Management's Discussion and Analysis
                  of Financial Condition and Results of Operations        6 - 12

         Item 3.  Quantitative and Qualitative Disclosures
                  About Market Risk                                           13

Part II. Other Information

         Items 1 through 6                                                    14

         Signatures                                                           15


                                       2
<PAGE>

PART 1.  FINANCIAL INFORMATION

Item 1.  Consolidated Financial Statements (Unaudited)


                   AMES NATIONAL CORPORATION AND SUBSIDIARIES
                           Consolidated Balance Sheets
                                   (unaudited)
<TABLE>
                                                                                    June 30,        December 31,
                                                                                      2002              2001
                                                                                  ------------------------------
<S>                                                                               <C>               <C>
        Assets
Cash and due from banks .......................................................   $  35,832,841     $ 42,459,156
Federal funds sold ............................................................      42,370,000       29,350,000
Interest bearing deposits in financial institutions ...........................         600,000          250,000
Securities available-for-sale .................................................     229,223,802      213,778,175
Loans receivable, net .........................................................     307,575,129      323,043,166
Bank premises and equipment, net ..............................................       7,894,748        7,183,655
Accrued income receivable .....................................................       5,297,369        5,977,353
Other assets ..................................................................         489,338          238,477
                                                                                  ------------------------------
           Total assets .......................................................   $ 629,283,227     $622,279,982
                                                                                  ==============================

       Liabilities and Stockholders' Equity
Deposits:
   Demand .....................................................................   $  52,293,228     $ 62,796,265
   NOW accounts ...............................................................     112,399,121      108,509,319
   Savings and money market ...................................................     145,496,094      138,342,052
   Time, $100,000 and over ....................................................      52,422,160       47,716,458
   Other time .................................................................     148,383,361      154,145,161
                                                                                  ------------------------------
           Total deposits .....................................................     510,993,964      511,509,255

FHLB advances .................................................................              --        1,000,000
Federal funds purchased and securities sold under agreements to repurchase ....      12,037,383       10,596,174
Dividends payable .............................................................       2,753,504        1,312,596
Deferred taxes ................................................................       2,749,561        1,188,670
Accrued interest and other liabilities ........................................       2,655,714        3,051,289
                                                                                  ------------------------------
           Total liabilities ..................................................     531,190,126      528,657,984
                                                                                  ------------------------------

Stockholders' Equity:
   Common stock, $5 par value; authorized 6,000,000 shares;
     issued 3,153,230 shares at June 30, 2002 and December 31, 2001 ...........      15,766,150       15,766,150
   Treasury stock, at cost; 24,248 and 28,001 shares at
     June 30, 2002 and December 31, 2001  .....................................      (1,333,640)      (1,530,805)
   Surplus ....................................................................      25,354,014       25,393,028
   Retained earnings ..........................................................      51,012,776       49,397,011
   Accumulated other comprehensive income - net unrealized gain
     on securities available-for-sale .........................................       7,293,801        4,596,614
                                                                                  ------------------------------
           Total stockholders' equity .........................................      98,093,101       93,621,998
                                                                                  ------------------------------

                                                                                  $ 629,283,227      622,279,982
                                                                                  ==============================
</TABLE>

                                       3
<PAGE>

                   AMES NATIONAL CORPORATION AND SUBSIDIARIES
                        Consolidated Statements of Income
                                   (unaudited)
<TABLE>
                                            Three Months Ended           Six Months Ended
                                                 June 30,                    June 30,
                                         -----------------------------------------------------
                                            2002           2001          2002         2001
                                         -----------------------------------------------------
<S>                                      <C>           <C>           <C>           <C>
Interest and dividend income:
    Loans ............................   $ 5,766,039   $ 7,109,567   $11,631,211   $14,378,349
    Securities .......................     2,778,464     2,958,595     5,477,549     6,059,233
    Federal funds sold ...............       251,243       256,731       452,027       345,801
    Dividends ........................       374,867       269,391       705,670       500,379
                                         -----------------------------------------------------
                                           9,170,613    10,594,284    18,266,457    21,283,762
                                         -----------------------------------------------------
Interest expense:
    Deposits .........................     2,971,413     4,840,597     5,959,373     9,969,974
    Other borrowed funds .............        59,765       299,188       133,899       696,350
                                         -----------------------------------------------------
                                           3,031,178     5,139,785     6,093,272    10,666,324
                                         -----------------------------------------------------

          Net interest income ........     6,139,435     5,454,499    12,173,185    10,617,438

Provision for loan losses ............       111,265       196,230       215,484       273,908
                                         -----------------------------------------------------
          Net interest income after
             provision for loan losses     6,028,170     5,258,269    11,957,701    10,343,530
                                         -----------------------------------------------------

Noninterest income:
    Trust department income ..........       276,425       257,054       527,155       487,802
    Service fees .....................       361,518       415,665       719,193       784,712
    Securities gains, net ............       133,941       662,682       322,673     1,151,531
    Other ............................       295,947       322,850       621,947       629,719
                                         -----------------------------------------------------
          Total noninterest income ...     1,067,831     1,658,251     2,190,968     3,053,764
                                         -----------------------------------------------------

Noninterest expense:
    Salaries and employee benefits ...     2,075,667     1,707,197     3,858,002     3,400,311
    Occupancy expenses ...............       226,202       155,348       429,564       368,949
    Data processing ..................       436,629       455,918       841,040       888,863
    Other operating expenses .........       572,207       544,617     1,114,355     1,073,711
                                         -----------------------------------------------------
          Total noninterest expense ..     3,310,705     2,863,080     6,242,961     5,731,834
                                         -----------------------------------------------------

          Income before income taxes .     3,785,296     4,053,440     7,905,708     7,665,460

Income tax expense ...................     1,044,361     1,336,042     2,223,843     2,368,004
                                         -----------------------------------------------------
          Net income .................   $ 2,740,935   $ 2,717,398   $ 5,681,865   $ 5,297,456
                                         =====================================================

Basic and diluted earnings per share .   $      0.88   $      0.87   $      1.82   $      1.70
                                         =====================================================

Declared dividends per share .........   $      0.88   $      0.40   $      1.30   $      0.80
                                         =====================================================

Comprehensive Income .................   $ 5,375,978   $ 2,059,011   $ 8,379,052   $ 6,762,486
                                         =====================================================
</TABLE>

                                       4
<PAGE>

                   AMES NATIONAL CORPORATION AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                                   (unaudited)
<TABLE>
                                                                                            Six Months Ended
                                                                                                June 30,
                                                                                       --------------------------
                                                                                          2002            2001
                                                                                       --------------------------
<S>                                                                                    <C>            <C>
Cash flows from operating activities:
   Net income ......................................................................   $ 5,681,865    $ 5,297,456
   Adjustments to reconcile net income to net cash provided by operating activities:
     Provision for loan losses .....................................................       215,484        273,908
     Amortization and accretion, net ...............................................        (2,095)       (28,110)
     Depreciation ..................................................................       449,235        353,583
     Provision for deferred taxes ..................................................       (24,475)      (111,000)
     Gain on sale of securities available-for-sale .................................      (322,673)    (1,151,531)
     Decrease in accrued income receivable .........................................       679,984      1,347,455
     Decrease (increase) in other assets ...........................................      (250,861)       450,872
     (Decrease) increase in accrued interest and other liabilities .................      (395,575)       463,614
                                                                                       --------------------------
           Net cash provided by operating activities ...............................     6,030,889      6,896,247
                                                                                       --------------------------

Cash flow from investing activities:
   Purchase of securities available-for-sale .......................................   (51,183,753)   (24,417,996)
   Proceeds from sale of securities available-for-sale .............................    23,852,113     11,501,993
   Proceeds from maturities of securities available-for-sale .......................    16,493,334     25,720,309
   Net decrease (increase) in interest bearing deposits in financial institutions ..      (350,000)        98,174
   Net increase in federal funds sold ..............................................   (13,020,000)   (18,740,000)
   Net decrease in loans ...........................................................    15,252,553     11,538,907
   Purchase of bank premises and equipment .........................................    (1,160,328)      (786,256)
                                                                                      ---------------------------
           Net cash used in investing activities ...................................   (10,116,081)     4,915,131
                                                                                      ---------------------------

Cash flows from financing activities:
   Decrease in deposits ............................................................      (515,291)    (2,768,421)
   Decrease in Federal Home Loan Bank advances .....................................    (1,000,000)    (6,000,000)
   Increase (decrease) in federal funds purchased and securities sold
     under agreements to repurchase ................................................     1,441,209     (4,026,316)
   Dividends paid ..................................................................    (2,625,192)    (2,497,834)
   Proceeds from issuance of treasury stock ........................................       158,151        110,834
                                                                                      ---------------------------
           Net cash provided by (used in) financing activities .....................    (2,541,123)   (15,181,737)
                                                                                      ---------------------------

           Net increase in cash and cash equivalents ...............................    (6,626,315)    (3,370,359)

Cash and cash equivalents at beginning of year .....................................    42,459,156     28,775,032
                                                                                      ---------------------------

Cash and cash equivalents at end of the period .....................................  $ 35,832,841   $ 25,404,673
                                                                                      ===========================
Supplemental disclosures of cash flow information:
   Cash paid for interest ..........................................................  $  6,531,731   $ 10,917,324
   Cash paid for taxes .............................................................     2,405,502      1,810,100
                                                                                      ===========================
</TABLE>

                                       5
<PAGE>

AMES NATIONAL CORPORATION AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Unaudited)

1. Significant Accounting Policies

The consolidated  financial statements for the three and six-month periods ended
June 30, 2002 and 2001 are  unaudited.  In the opinion of the management of Ames
National  Corporation (the "Company"),  these financial  statements  reflect all
adjustments,  consisting only of normal recurring accruals, necessary to present
fairly these consolidated  financial  statements.  The results of operations for
the  interim  periods are not  necessarily  indicative  of results  which may be
expected  for an  entire  year.  Certain  information  and  footnote  disclosure
normally included in complete financial  statements  prepared in accordance with
generally  accepted  accounting  principles have been omitted in accordance with
the  requirements  for  interim  financial  statements.  The  interim  financial
statements  and notes thereto  should be read in  conjunction  with the year-end
audited financial  statements  contained in the Company's 10-K. The consolidated
condensed  financial  statements  include  the  accounts  of the Company and its
wholly-owned  banking subsidiaries (the "Banks").  All significant  intercompany
balances and transactions have been eliminated in consolidation.

2. Dividends

On August 14, 2002,  the Company  declared a cash  dividend on its common stock,
payable on November 15, 2002 to  stockholders  of record as of November 1, 2002,
equal to $0.44 per share.

3. Earnings Per Share

Earnings per share amounts were  calculated  using the weighted  average  shares
outstanding  during the periods  presented.  The  weighted  average  outstanding
shares for the three  months  ended June 30,  2002 and 2001 were  3,125,889  and
3,122,743,  respectively.  The weighted average  outstanding  shares for the six
months ended June 30, 2002 and 2001 were 3,125,163 and 3,122,521, respectively.

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
        of Operations

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements about the
Company,  its  business and its  prospects.  Forward-looking  statements  can be
identified by the fact that they do not relate strictly to historical or current
facts.  They often include use of the words "believe",  "expect",  "anticipate",
"intend",  "plan",  "estimate"  or  words  of  similar  meaning,  or  future  or
conditional  verbs  such  as  "will",  "would",   "should",  "could"  or  "may".
Forward-looking   statements,   by  their  nature,  are  subject  to  risks  and
uncertainties.  A number of  factors,  many of which are  beyond  the  Company's
control,   could  cause   actual   conditions,   events  or  results  to  differ
significantly from those described in the forward-looking statements. Such risks
and  uncertainties  with  respect to the Company  include  those  related to the
economic  environment,  particularly  in the areas in which the  Company and the
Banks operate, competitive products and pricing, fiscal and monetary policies of
the U.S.  government,  changes in governmental  regulations  affecting financial
institutions,  including  regulatory fees and capital  requirements,  changes in
prevailing   interest  rates,   credit  risk   management  and   asset/liability
management,  the financial and securities  markets and the  availability  of and
costs associated with sources of liquidity.

Results of Operations for Three Months Ending June 30, 2002 and June 30, 2001

General

In June 2002, the Company opened its fifth wholly owned bank subsidiary,  United
Bank & Trust N.A. in Marshalltown,  Iowa. The consolidated  financial statements
include the accounts of this new  organization  as well as the four  established
wholly owned subsidiaries;  First National Bank, Ames, Iowa; Boone Bank & Trust,
Boone, Iowa;  Randall-Story State Bank, Story City, Iowa; and State Bank & Trust
Co., Nevada, Iowa..

The Company  earned net income of  $2,741,000,  or $0.88 per share for the three
months ended June 30, 2002,  compared to net income of $2,717,000,  or $0.87 per
share,  for the three  months  ended June 30,  2001,  an increase of 0.87%.  The
Company's  return on average assets was 1.73% and 1.75%,  respectively,  for the
three-month periods ending June 30, 2002 and 2001.

                                       6
<PAGE>

While net income was very  comparable  for  three-month  periods ending June 30,
2002 and 2001,  the  composition  of the  earnings  had some  differences  worth
noting.  Interest expense on deposit declined significantly in spite of a higher
volume of deposits.  This lower  interest  expense was offset by lower  security
gains, higher salary and employee benefits and by lower interest income on loans
as both the volume of loans and related interest rates declined.  Lower interest
rates on alternative  fixed rate  investments and shaken investor  confidence in
the  equities  market has  contributed  to higher  level of deposits in spite of
historically  low rates on deposits.  Loan demand has been soft and  competitive
pricing in the Company's  local markets has  contributed  to lower loan interest
income.

The  following  table sets forth certain  information  relating to the Company's
average balance sheets and reflects the average yield on assets and average cost
of  liabilities  for the three  month  periods  ended June 30, 2002 and June 30,
2001, respectively.

ASSETS
(dollars in thousands)
<TABLE>

                                              AVERAGE BALANCE SHEET AND INTEREST RATES
                                                     Three Months Ended June 30,
                                       -----------------------------------------------------------
                                                   2002                          2001
                                       ---------------------------     ---------------------------
                                       Average    Revenue/  Yield/     Average  Revenue/   Yield/
                                       Balance    Expense    Rate      Balance  Expense     Rate
                                       -----------------------------------------------------------
<S>                                    <C>        <C>       <C>       <C>        <C>        <C>
Loans
  Commercial .......................   $ 46,208   $    828   7.17%    $ 53,044  $ 1,117    8.42%
  Agricultural .....................     25,250        469   7.43%      29,645      658    8.88%
  Real estate ......................    223,589      4,120   7.37%     240,207    4,853    8.08%
  Installment and other ............     19,041        349   7.33%      24,189      482    7.97%
                                       ---------------------------------------------------------
Total loans (including fees) .......   $314,088   $  5,766   7.34%    $347,085  $ 7,110    8.19%

Investment securities
  Taxable ..........................   $149,189   $  2,306   6.18%    $149,356  $ 2,379    6.37%
  Tax-exempt .......................     70,090      1,278   7.29%      66,912    1,281    7.66%
                                       ---------------------------------------------------------
Total investment securities ........   $219,279   $  3,584   6.54%    $216,268  $ 3,660    6.77%

Interest bearing deposits with banks   $    600   $      5   3.33%    $    250  $     3    4.80%
Federal funds sold .................     59,639        251   1.68%      23,988      257    4.29%
                                       ---------------------------------------------------------
Total interest-earning assets ......   $593,606   $  9,606   6.47%    $587,591  $11,030    7.51%

Noninterest-earning assets .........     41,830                         33,211
                                       --------                       --------
TOTAL ASSETS .......................   $635,436                       $620,802
                                       ========                       ========
<FN>
1    Average loan balance  include  nonaccrual  loans,  if any.  Interest income
     collected on nonaccrual loans has been included.

2    Tax-exempt  income has been  adjusted  to a  tax-equivalent  basis using an
     incremental rate of 34%.
</FN>
</TABLE>

                                       7
<PAGE>

LIABILITIES AND STOCKHOLDERS' EQUITY
(dollars in thousands)
<TABLE>
                                                           AVERAGE BALANCE SHEET AND INTEREST RATES
                                                                 Three Months Ended June 30,
                                               -----------------------------------------------------------------
                                                           2002                              2001
                                               -----------------------------    --------------------------------
                                               Average    Revenue/   Yield/     Average     Revenue/     Yield/
                                               Balance    Expense     Rate      Balance     Expense       rate
                                               -----------------------------------------------------------------
<S>                                            <C>        <C>        <C>        <C>         <C>         <C>
              Interest-bearing liabilities
Deposits
  Savings, NOW accounts, and money markets .   $270,611   $    967    1.43%     $225,130    $  1,563      2.78%
  Time deposits < $100,000 .................    149,509      1,518    4.06%      161,146       2,319      5.76%
  Time deposits > $100,000 .................     52,523        486    3.70%       63,351         959      6.06%
                                               ----------------------------------------------------------------
Total deposits .............................   $472,643   $  2,971    2.51%     $449,627    $  4,841      4.31%
Other borrowed funds .......................     11,589         60    2.07%       24,497         299      4.88%
                                               ----------------------------------------------------------------
Total Interest-bearing .....................   $484,232   $  3,031    2.50%     $474,124    $  5,140      4.34%
liabilities

             Noninterest-bearing liabilities
Demand deposits ............................   $ 49,496                         $ 50,482
Other liabilities ..........................      4,862                            5,781
                                               --------                         --------
Stockholders' equity .......................   $ 96,846                         $ 90,415
                                               --------                         --------

TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY .......................   $635,436                         $620,802
                                               ========                         ========

Net interest income ........................              $  6,575    4.43%                 $  5,890      4.01%
                                                          ========                          ========
Spread Analysis

Interest income/average assets .............              $  9,606    6.05%                 $ 11,030      7.11%
Interest expense/average assets ............                 3,031    1.91%                    5,140      3.31%
Net interest income/average assets .........                 6,575    4.14%                    5,890      3.80%
<FN>
1    Tax-exempt  income has been  adjusted  to a  tax-equivalent  basis using an
     incremental rate of 34%.
</FN>
</TABLE>

Net Interest Income

For the three months ended June 30, 2002, the Company's net interest  margin was
4.43%  compared to 4.01% for the three months ended June 30, 2001.  Net interest
income,  prior to the adjustment for  tax-exempt  income,  for the quarter ended
June 30, 2002 and 2001 totaled  $6,139,000 and  $5,454,000,  respectively.  This
12.6% increase  resulted  primarily from lower interest expense  attributable to
lower interest rates on deposits  partially  offset by lower interest  income on
loans.

For the three months ended June 30, 2002,  interest income decreased  $1,424,000
or 13.4% when  compared to the same period in 2001.  This decrease was primarily
attributable to lower loan volume and yields.

Interest  expense  decreased  $2,109,000 or 41.0% for the quarter ended June 30,
2002 when compared to the same period in 2001.  Lower interest rates on deposits
and other  borrowings  resulted in decreased  interest  expense as the Company's
cost of funds declined with market interest rates.

Provision for Loan Losses

The Company  provided  $111,000  for loan losses for the three months ended June
30,  2002  compared to  $196,000  during the same  period  last year.  Provision
expense  for both  periods  were  utilized  to increase  specific  reserves  for
impaired loans.

                                       8
<PAGE>

Noninterest Income and Expense

Noninterest  income decreased  $590,000,  or 35.6% during the quarter ended June
30, 2002 compared to the same period in 2001.  The decrease can be attributed to
lower  securities  gains in the Company's  equity  portfolio of $134,000 in 2002
compared to $663,000 in second quarter of 2001, a difference of $529,000.

Noninterest  expense increased  $448,000 or 15.6% for the second quarter of 2002
compared to the same period in 2001.  Noninterest  expense items that  increased
include  salary and  benefits  and  occupancy  expense.  Salaries  and  benefits
increased  $368,000 as the result of additional staff at United Bank & Trust and
First National Bank, higher incentive compensation, and increased profit sharing
contributions to the Company's  retirement plan.  Occupancy  expenses reflect an
increase of $71,000  primarily as the result of higher  depreciation  associated
with an  addition to First  National  Bank's  main  office and  occupancy  costs
associated with the opening of United Bank & Trust.

Income Taxes

The  provision  for income taxes for June 30, 2002 and 2001 was  $1,044,000  and
$1,336,000,  respectively. This amount represents an effective tax rate of 27.6%
for the second  quarter  of 2002,  compared  to 33.0% for the second  quarter of
2001. The Company's  marginal  federal tax rate is currently 35%. The difference
between the Company's  effective  and marginal tax rate is primarily  related to
investments made in tax exempt securities.

Results of Operations for Six Months Ending June 30, 2002 and June 30, 2001

General

In June 2002, the Company opened its fifth wholly owned bank subsidiary,  United
Bank & Trust N.A. in Marshalltown,  Iowa. The consolidated  financial statements
include the accounts of this new  organization  as well as the four  established
wholly owned subsidiaries;  First National Bank, Ames, Iowa; Boone Bank & Trust,
Boone, Iowa;  Randall-Story State Bank, Story City, Iowa; and State Bank & Trust
Co., Nevada, Iowa.

The  Company  earned  net  income of  $5,682,000  or $1.82 per share for the six
months ended June 30, 2002,  compared to net income of $5,297,000,  or $1.70 per
share,  for the six  months  ended  June 30,  2001,  an  increase  of 7.3%.  The
Company's  return on average  assets was 1.81% and 1.72%,  respectively  for the
six-month period ending June 30, 2002 and 2001.

The improvement in net income can be primarily attributed to higher net interest
income.  This higher net  interest  income was offset by lower  security  gains,
higher salary and employee  benefits.  Lower interest rates on alternative fixed
rate  investments  and shaken  investor  confidence  in the equities  market has
contributed  to higher level of deposits in spite of  historically  low rates on
deposits.  Loan demand has been soft and  competitive  pricing in the  Company's
local markets has contributed to lower loan interest income.

                                       9
<PAGE>

The  following  table sets forth certain  information  relating to the Company's
average balance sheets and reflects the average yield on assets and average cost
of liabilities  for the six month periods ended June 30, 2002 and June 30, 2001,
respectively.

ASSETS
(dollars in thousands)
<TABLE>
                                                  AVERAGE BALANCE SHEET AND INTEREST RATES
                                                         Six Months Ended June 30,
                                       ---------------------------------------------------------------
                                                   2002                             2001
                                       ----------------------------     ------------------------------
                                       Average    Revenue/   Yield/     Average    Revenue/     Yield/
                                       Balance    Expense     Rate      Balance    Expense       Rate
                                       ---------------------------------------------------------------
<S>                                    <C>        <C>        <C>        <C>        <C>          <C>
  Loans
  Commercial .......................   $ 45,114   $  1,630   7.23%      $ 52,935   $  2,299      8.69%
  Agricultural .....................     24,929        938   7.53%        29,461      1,332      9.04%
  Real estate ......................    225,653      8,366   7.41%       241,726      9,765      8.08%
  Installment and other ............     19,546        697   7.13%        24,721        982      7.94%
                                       ---------------------------------------------------------------
Total loans (including fees) .......   $315,242   $ 11,631   7.38%      $348,843   $ 14,378      8.24%

Investment securities
  Taxable ..........................   $145,042   $  4,389   6.05%      $152,612   $  4,874      6.39%
  Tax-exempt .......................     70,263      2,710   7.71%      $ 66,512      2,545      7.65%
                                       ---------------------------------------------------------------
Total investment securities ........   $215,305   $  7,099   6.59%      $219,124   $  7,419      6.77%

Interest bearing deposits with banks   $    501   $      7   2.79%      $    250   $      6      4.80%
Federal funds sold .................     54,899        452   1.65%        15,806        346      4.38%
                                       ---------------------------------------------------------------
Total interest-earning assets ......   $585,947   $ 19,189   6.55%      $584,023   $ 22,149      7.59%

Total noninterest-earning assets ...   $ 41,306                         $ 32,712
                                       --------                         --------
TOTAL ASSETS .......................   $627,253                         $616,735
                                       ========                         ========
<FN>
1    Average loan balance include  nonaccrual  loans, if any. Interest income on
     nonaccrual loans has been included.

2    Tax-exempt  income has been  adjusted  to a  tax-equivalent  basis using an
     incremental rate of 34%.
</FN>
</TABLE>

                                       10
<PAGE>

LIABILITIES AND STOCKHOLDERS' EQUITY
(dollars in thousands)
<TABLE>

                                                        AVERAGE BALANCE SHEET AND INTEREST RATES
                                                                  Six Months Ended June 30,
                                               ----------------------------------------------------------------
                                                           2001                              2000
                                               ------------------------------   -------------------------------
                                               Average    Revenue/     Yield/   Average     Revenue/     Yield/
                                               Balance    Expense       Rate     Balance    Expense       Rate
                                               ----------------------------------------------------------------
<S>                                            <C>        <C>         <C>       <C>         <C>          <C>
              Interest-bearing liabilities
Deposits
  Savings, NOW accounts, and money markets .   $260,293   $  1,798     1.38%    $220,960    $  3,343      3.03%
  Time deposits < $100,000 .................    151,344      3,200     4.23%     160,140       4,646      5.80%
  Time deposits > $100,000 .................     49,474        961     3.88%      64,105       1,981      6.18%
                                               ----------------------------------------------------------------
Total deposits .............................   $461,111   $  5,959     2.58%    $445,205    $  9,970      4.48%
Other borrowed funds .......................     13,407        134     2.00%      26,681         696      5.22%
                                               ----------------------------------------------------------------
Total Interest-bearing .....................   $474,518   $  6,093     2.57%    $471,886    $ 10,666      4.52%
liabilities

             Noninterest-bearing liabilities
Demand deposits ............................   $ 51,779                         $ 49,592
Other liabilities ..........................      4,986                            6,030
                                               --------                         --------
Stockholders' equity .......................   $ 95,970                         $ 89,227
                                               --------                         --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY .......................   $627,253                         $616,735
                                               ========                         ========

Net interest income ........................              $ 13,096     4.47%                $ 11,483      3.93%
                                                          ========                          ========
Spread Analysis

Interest income/average assets .............              $ 19,189     6.12%                $ 22,149      7.18%
Interest expense/average assets ............                 6,093     1.94%                  10,666      3.46%
Net interest income/average assets .........                13,096     4.18%                  11,483      3.72%
<FN>

1    Tax-exempt  income has been  adjusted  to a  tax-equivalent  basis using an
     incremental rate of 34%.
</FN>
</TABLE>

Net Interest Income

For the six months ended June 30, 2002,  the Company's  net interest  margin was
4.47%  compared to 3.93% for the six months  ended June 30,  2001.  Net interest
income, prior to the adjustment for tax-exempt income, for the first half of the
year  ended  June  30,  2002  and  2001  totaled  $12,173,000  and  $10,617,000,
respectively. This 14.7% increase resulted primarily from lower interest expense
attributable to lower interest rates on deposits and other borrowings  partially
offset by lower interest income on loans.

For the six months ended June 30, 2002, interest income decreased  $3,017,000 or
14.2% when  compared to the same period in 2001.  This  decrease  was  primarily
attributable  to lower loan volume and yields as a result of a general slow down
in the Company's  local markets and  significant  competition  for fewer lending
opportunities.

Interest expense decreased $4,573,000 or 42.9% for the six months ended June 30,
2002 when compared to the same period in 2001.  Lower interest rates on deposits
and other  borrowings  resulted in decreased  interest  expense as the Company's
cost of funds declined with market interest rates.

                                       11
<PAGE>

Provision for Loan Losses

The Company provided  $215,000 for loan losses for the six months ended June 30,
2002 compared to $274,000  during the same period last year.  Provision  expense
for both periods were utilized to increase specific reserves for impaired loans.

Noninterest Income and Expense

Noninterest income decreased $863,000, or 28.3% during the six months ended June
30, 2002 compared to the same period in 2001.  The decrease can be attributed to
a decline securities gains in the Company's equity portfolio of $323,000 in 2002
compared to $1,152,000 in the first half of 2001, a difference of $829,000.

Noninterest  expense  increased  $511,000  or 8.9%  for the  first  half of 2002
compared to the same period in 2001. Noninterest expense items that increased in
the first  half of 2002  compared  to same  period in 2001  include  salary  and
benefits and occupancy expense.  Salaries and benefits increased $458,000 as the
result of  additional  staff at United  Bank & Trust  and First  National  Bank,
higher incentive compensation, and increased profit sharing contributions to the
Company's  retirement  plan.  Occupancy  expenses reflect an increase of $61,000
primarily as the result of higher  depreciation  associated  with an addition to
First  National  Bank's  main office and  occupancy  costs  associated  with the
opening of United Bank & Trust.

Income Taxes

The  provision for income taxes for the six months ending June 30, 2002 and 2001
was $2,224,000 and $2,368,000, respectively. This amount represents an effective
tax rate of 28.1% for the  first  half of 2002,  compared  to 30.9% for the same
period in 2001.  The Company's  marginal  federal tax rate is currently 35%. The
difference  between the  Company's  effective and marginal tax rate is primarily
related to investments made in tax exempt securities.

Financial Condition

Assets

For the quarter ended June 30, 2002, total assets are $629,283,000, a $7,003,000
increase in comparison  to December 31, 2001 totals.  The higher level of assets
are  attributable  to a higher  volume  of  federal  funds  sold and  investment
securities partially offset by a lower volume of loans.

Investment Portfolio

The increase in the volume of investment  securities to $229,224,000 on June 30,
2002 from  $213,778,000  on December 31, 2001 resulted from the purchase of U.S.
government agencies and corporate bonds.

Loan Portfolio

Net loans as of June 30, 2002 totaled  $307,575,000,  a decrease of  $15,468,000
from outstanding  balances as of December 31, 2001. The decreased level of loans
relates to lower loan demand and significant market competition for loans.

Impaired loans totaled  $2,912,000 as of June 30, 2002 compared to $3,489,000 as
of December 31,  2001.  A loan is  considered  impaired  when,  based on current
information  and  events,  it is  probable  that the  Company  will be unable to
collect the  scheduled  payments of principal or interest  when due according to
the  contractual  terms of the loan  agreement.  Impaired  loans  include  loans
accounted for on a non-accrual  basis;  accruing  loans which are  contractually
past  due 90  days  or  more  as to  principal  or  interest  payments;  and any
restructured  loans. As of June 30, 2002,  non-accrual loans totaled $2,205,000,
past due loans still accruing  totaled  $707,000 and there were no  restructured
loans outstanding.  Other real estate owned as of June 30, 2002 and December 31,
2001 totaled $404,000 and $159,000, respectively.

Net charge offs were $170,000 for the six months ended June 30, 2002 as compared
to net  charge-offs  $265,000  for the six months  ended June 30,  2001.  Losses
related primarily to previously  identified  impaired  commercial loans for both
periods.  The resulting  allowance for loan losses as percentage of  outstanding
loans  as of  June  30,  2002  and  December  31,  2001  was  1.75%  and  1.59%,
respectively.

                                       12
<PAGE>

The allowance for loan losses is  management's  best estimate of probable losses
inherent in the loan portfolio as of the balance sheet date.  Factors considered
in establishing an appropriate allowance include: an assessment of the financial
condition of the borrower;  a realistic  determination  of value and adequacy of
underlying  collateral;  the condition of the local economy and the condition of
the specific  industry of the borrower;  an analysis of the levels and trends of
loan categories; and a review of delinquent and classified loans.

Deposits  declined  $515,000 from  year-end  2001.  The  Company's  deposits are
typically at a seasonal low point at the end of the second  quarter of each year
as First National  Bank's  deposit levels are impacted by Iowa State  University
students  departing in May and June and returning in August.  Total deposits for
June 30,  2002  compared to June 30,  2001 are up  $20,334,000  as the result of
customers  maintaining  larger  balances and the growth in the number of deposit
accounts.

Other borrowed funds as of June 30, 2002, consisted primarily of securities sold
under  agreements to  repurchase  totaling  $12,037,000  compared to total other
borrowing as of December 31, 2001 of $11,596,000.

Stockholders equity increased to $98,093,000 as of June 30, 2002 as earnings and
unrealized  gains on  securities  available  for sale  continued  to augment the
company's strong capital base.

Liquidity and Capital Resources

The  objective  of  liquidity  management  is  to  ensure  the  availability  of
sufficient  cash flows to meet all  financial  commitments  and to capitalize on
opportunities for profitable business expansion.  The Company's principal source
of funds is deposits including demand, money market, savings and certificates of
deposits. Other sources include principal repayments on loans, proceeds from the
maturity and sale of investment securities,  federal fund purchased,  repurchase
agreements,  advances  from the  Federal  Home Loan Bank and funds  provided  by
operations.  Net cash  from  operating  activities  contributed  $6,031,000  and
$6,896,000  to  liquidity  for the six  months  ended  June 30,  2002 and  2001,
respectively.  Liquid  assets  including  cash on hand,  balances due from other
banks,   federal   funds  sold  and   interest-bearing   deposits  in  financial
institutions  increased to  $78,803,000 as of June 30, 2002 compared to year-end
2001 balance of  $72,059,000.  The increase in fed funds sold is attributable to
decreased loan volume.

Securities available for sale increased to $229,224,000 as of June 30, 2002 from
$213,778,000  as of December 31, 2001 and provide  additional  liquidity for the
Company.

To provide additional  external  liquidity,  the Banks have outstanding lines of
credit with the Federal Home Loan Bank of Des Moines,  Iowa of  $33,732,000  and
federal funds borrowing  capacity at correspondent  banks of $46,000,000.  As of
June 30,  2002,  the  Company had no  outstanding  borrowings  of federal  funds
purchased  or Federal  Home Loan Bank  advances.  Management  believes  that the
Company's  liquidity  sources will be sufficient to support existing  operations
for the foreseeable future.

The Company's total stockholder's equity increased to $98,093,000 as of June 30,
2002, from $93,622,000 as of December 31, 2001.  Stockholders' equity as of June
30, 2002 was 15.6% of total  assets,  compared to 15.0 % at December  31,  2001.
Total equity increased due to the retention of earnings and from appreciation in
the  Company  and  Banks'  stock  and  bond  portfolios.   No  material  capital
expenditures or material  changes in the capital resource mix are anticipated at
this time.  Management  believes  that, as of June 30, 2002, the Company and its
Banks meet the capital  requirements to which they are subject. As of that date,
all  the  Company's  Banks  were  "well  capitalized"  under  regulatory  prompt
corrective action provisions.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Company's  market risk is comprised  primarily of interest rate risk arising
from its core banking  activities of lending and deposit  taking.  Interest rate
risk  results  from the changes in market  interest  rates  which may  adversely
affect the Company's net interest income.  Management  continually  develops and
applies  strategies to mitigate this risk.  Management does not believe that the
Company's  primary  market risk exposure and how it has been managed  to-date in
2002 changed significantly when compared to 2001.

                                       13
<PAGE>

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

         Not applicable

Item 2.  Changes in Securities and Use of Proceeds

         Not applicable

Item 3.  Defaults Upon Senior Securities

         Not applicable

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

At the Company's annual meeting of shareholders on April 24, 2002,  stockholders
re-elected  Douglas C.  Gustafson and Charles D. Jons to the Company's  Board of
Directors.  Continuing  directors  include Betty A. Baudler,  Dale F.  Collings,
James R. Larson II, Robert W. Stafford, James R. Christy, Daniel L. Krieger, and
Marvin J. Walter.

There were 3,125,229  issued and outstanding  shares of common stock entitled to
vote at the annual meeting. The voting results on the election of directors were
as follows:

                                                              Votes
                                                   -----------------------------
                                                   In Favor             Withheld
                                                   -----------------------------

Douglas C. Gustafson ...................           2,603,268             521,961
Charles D. Jons ........................           2,603,268             521,961

There were no broker non-votes or abstentions on this proposal.

Item 5.   Other Information

          None

Item 6.   Exhibits and Reports on Form 8-K

          (a)  Exhibits

               Exhibit 99.1 - Certification pursuant to Section 906 of the
                              Sarbanes-Oxley Act of 2002

          (b)  Reports on Form 8-K

               On April 22, 2002,  the Company filed a Form 8-K pursuant to Item
               5, announcing net earnings for the quarter ended March 31, 2002.

               On April 24, 2002,  the Company filed a Form 8-K pursuant to Item
               5,  announcing  forecasted  earnings for the year ending December
               31, 2002.

                                       14
<PAGE>


                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                             AMES NATIONAL CORPORATION

DATE: August 14, 2002                        By:  /s/ Daniel L. Krieger
                                                  -----------------------------
                                                  Daniel L. Krieger, President
                                                  (Principal Executive Officer)

                                             By:  /s/ John P. Nelson
                                                  ------------------------------
                                                  John P. Nelson, Vice President
                                                  (Principal Financial Officer)



                                       15

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>3
<FILENAME>ames991.txt
<TEXT>
                                                                    EXHIBIT 99.1

                  CERTIFICATION PURSUANT TO SECTION 906 OF THE
                           SARBANES-OXLEY ACT OF 2002



In  connection  with the  filing  of the  Quarterly  Report on Form 10-Q for the
Quarter  Ended June 30, 2002 (the  "Report") by Ames National  Corporation  (the
"Company"),  each of the  undersigned  officers of the Company hereby  certifies
that:

1.   The Report fully complies with the  requirements  of Section 13(a) or 15(d)
     of the Securities Exchange Act of 1934, as amended; and

2.   The information  contained in the Report fairly  presents,  in all material
     respects,  the financial condition and results of operations of the Company
     as of and for the period covered by the Report.

IN WITNESS WHEREOF,  the undersigned have executed this  Certification as of the
14th day of August, 2002.

                                             By:  /s/ Daniel L. Krieger
                                                  ------------------------------
                                                  Daniel L. Krieger, President
                                                  (Principal Executive Officer)


                                             By:  /s/ John P. Nelson
                                                  ------------------------------
                                                  John P. Nelson, Vice President
                                                  (Principal Financial Officer)





</TEXT>
</DOCUMENT>
</SUBMISSION>
