UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended December 31, 1997
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 0-12126
FRANKLIN FINANCIAL SERVICES CORPORATION
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 25-1440803
(State or other jurisdiction of incorporation (I.R.S. Employer
or organization) Identification No.)
20 South Main Street, PO Box T, Chambersburg, PA 17201-0819
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (717) 264-6116
Securities registered pursuant to Section 12(b) of the Act:
Names of each exchange
Title of each class on which registered
NONE
Securities registered pursuant to Section 12(g) of the Act:
Common Stock $1.00 par value per share
(Title of class)
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 periods that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements of the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. X
The aggregate market value of the 2,304,041 shares of the Registrant's common
stock held by nonaffiliates of the Registrant as of February 6, 1998, based on
the average of the bid and asked price for such shares, was $81,793,456.
APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS;
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes No
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate by the number of shares outstanding of each of the registrant's
classes of common stock as of the latest practicable date. There were
2,796,082 outstanding shares of the Registrant's common stock as of February
6, 1998.
DOCUMENTS INCORPORATED BY REFERENCE
(1) Portions of the annual report to stockholders for the year ended
December 31, 1997, are incorporated by reference into Part I and Part II.
(2) Portions of the definitive annual proxy statement to be filed,
pursuant to Reg. 14A within 120 days after December 31, 1997, are incorporated
into Part III.
FRANKLIN FINANCIAL SERVICES CORPORATION
FORM 10-K
INDEX
Part I
Page
Item 1. Business . . . . . . . . . . . . . . . . . . . . .2
Item 2. Properties . . . . . . . . . . . . . . . . . . . 10
Item 3. Legal Proceedings. . . . . . . . . . . . . . . . 10
Item 4. Submission of Matters to a Vote of
Security Holders . . . . . . . . . . . . . . . 10
Part II
Item 5. Market for Registrant's Common Equity and
Related Stockholder Matters . . . . . . . . . 10
Item 6. Selected Financial Data. . . . . . . . . . . . . 10
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations .11
Item 8. Financial Statements and Supplementary Data. . . 11
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure. . . . .11
Part III
Item 10. Directors and Executive Officers of the
Registrant . . . . . . . . . . . . . . . . . 11
Item 11. Executive Compensation. . . . . . . . . . . . . 11
Item 12. Security Ownership of Certain Beneficial Owners
and Management. . . . . . . . . . . . . . . . . 12
Item 13. Certain Relationships and Related Transactions. 12
Part IV
Item 14. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K . . . . . . . . . . . 12
Signatures. . . . . . . . . . . . . . . . . . . . . . . . 15
Index of Exhibits . . . . . . . . . . . . . . . . . . . . 17
Part I
Item 1. Business
General
Franklin Financial Services Corporation (the "Corporation") was
organized as a Pennsylvania business corporation on June 1, 1983 and is a
registered bank holding company under the Bank Holding Company Act of 1956, as
amended (the "BHCA"). On January 16, 1984, pursuant to a plan of
reorganization approved by the shareholders of Farmers and Merchants Trust
Company of Chambersburg ("F&M Trust" or "the Bank") and the appropriate
regulatory agencies, the Corporation acquired all the shares of F&M Trust and
issued its own shares to former F&M Trust shareholders on a share-for-share
basis.
On May 1, 1995, the Mont Alto State Bank, also a commercial bank and a
subsidiary of the Corporation, was merged into Farmers and Merchants Trust
Company. In addition, on December 29, 1995, Franklin Founders Life Insurance
Company, a credit life reinsurance company and a subsidiary of the
Corporation, was liquidated.
The Corporation conducts all of its business through its only direct
subsidiary, F&M Trust, which is wholly-owned. F&M Trust, established in 1906,
is a full-service, Pennsylvania-chartered commercial bank and trust company
which is not a member of the Federal Reserve System. F&M Trust, which operates
12 full service offices in Franklin and Cumberland Counties, Pennsylvania,
engages in general commercial, retail banking and trust services normally
associated with community banks and its deposits are insured (up to applicable
limits) by the Federal Deposit Insurance Corporation (the "FDIC"). A wide
variety of banking services are offered by F&M Trust to businesses,
individuals, and governmental entities. These services include, but are not
necessarily limited to, accepting and maintaining checking, savings, and time
deposit accounts, providing investment and trust services, making loans and
providing safe deposit facilities.
The Corporation's subsidiary is not dependent upon a single customer or
a few customers for a material part of their business. Thus, the loss of any
customer or identifiable group of customers would not materially affect the
business of the Corporation or F&M Trust in an adverse manner. Also, none of
the Corporation's business is seasonal.
The Bank's lending activities consist primarily of commercial,
agricultural and industrial loans, installment and revolving loans to
consumers, residential mortgage loans, and construction loans. Secured and
unsecured commercial and industrial loans, including accounts receivable,
inventory financing and commercial equipment financing, are made to small and
medium-sized businesses, individuals, governmental entities, and non-profit
organizations. F&M Trust also participates in the Pennsylvania Higher
Education Assistance Act student loan program and the Pennsylvania Housing
Finance Agency program.
Installment loans involve both direct loans to consumers and the
purchase of consumer obligations from dealers and others who have sold or
financed the purchase of merchandise, including automobiles and mobile homes,
to their customers on time. The Bank's mortgage loans include long-term loans
to individuals and to businesses secured by mortgages on the borrower's real
property. Construction loans are made to finance the purchase of land and the
construction of buildings thereon, and are secured by short-term mortgages on
real estate. In certain situations, the Bank acquires properties through
foreclosure on delinquent loans. The Bank holds these properties until such
time as they are in a marketable condition and a buyer can be obtained.
F&M Trust's Investment and Trust Services Department offers all of the
personal and corporate trust services normally associated with trust
departments of area banks, including estate planning and administration,
corporate and personal trust fund management, pension, profit sharing and
other employee benefits funds management, custodial services, and trustee
services for publicly issued debentures.
Competition
The Corporation and its subsidiary operate in a competitive environment
that has intensified in the past few years as they have been compelled to
share their market with institutions that are not subject to the regulatory
restrictions on domestic banks and bank holding companies. Profit margins in
the traditional banking business of lending and deposit gathering have
declined as deregulation has allowed nonbanking institutions to offer
alternative services to many of F&M Trust's customers.
The principal market of F&M Trust is in Franklin County and western
Cumberland County, Pennsylvania. Twelve commercial bank competitors of F&M
Trust have offices in this region, in addition to credit unions, savings and
loan associations, mortgage banks, brokerage firms and other competitors. F&M
Trust is the largest locally owned financial institution in Franklin County
and had total assets of approximately $354,000,000 at December 31, 1997.
All of the local commercial bank competitors of the Corporation are
subsidiaries of bank holding companies. The Corporation ranks sixth in size of
the thirteen bank holding companies having offices in its primary market.
Staff
As of December 31, 1997, the Corporation and its subsidiary had 152
full-time employees and 51 part-time employees. Most employees participate in
pension, profit sharing/bonus, and employee stock purchase plans and are
provided with group life, health and major medical insurance. Management
considers employee relations to be excellent.
Supervision and Regulation
Various requirements and restrictions under the laws of the United
States and under Pennsylvania law affect the Corporation and its subsidiaries.
General
The Corporation is registered as a bank holding company subject to
supervision and regulation by the Board of Governors of the Federal Reserve
System (the "Federal Reserve Board") under the BHCA, as amended. As a bank
holding company, the Corporation's activities and those of its banking and
nonbanking subsidiaries are limited to the business of banking and activities
closely related or incidental to banking. Bank holding companies are required
to file periodic reports with and are subject to examination by the Federal
Reserve Board. The Federal Reserve Board has issued regulations under the
BHCA that require a bank holding company to serve as a source of financial and
managerial strength to its subsidiary banks. As a result, the Federal Reserve
Board, pursuant to such regulations may require the Corporation to stand ready
to use its resources to provide adequate capital funds to its banking
subsidiaries during periods of financial stress or adversity.
The BHCA prohibits the Corporation from acquiring direct or indirect
control of more than 5% of the outstanding shares of any class of voting stock
or substantially all of the assets of any bank or merging or consolidating
with another bank holding company without prior approval of the Federal
Reserve Board. Similar restrictions currently apply to acquisition of control
of shares of stock of the Corporation or its banking subsidiaries by other
bank holding companies. Additionally, the BHCA prohibits the Corporation from
engaging in or from acquiring ownership or control of more than 5% of the
outstanding shares of any class of voting stock of any company engaged in a
nonbanking business, unless such business is determined by the Federal Reserve
Board to be so closely related to banking as to be a proper incident thereto.
F&M Trust is not a member of the Federal Reserve System. Accordingly,
its operations are subject to regulation and examination by the FDIC and by
the Pennsylvania Department of Banking ("PDOB"). F&M Trust is subject to
requirements and restrictions under federal and state law, including
requirements to maintain reserves against deposits, restrictions on the types
and amount of loans that may be granted and the interest that may be charged
thereon, and limitations on the types of investments that may be made and the
types of services that may be offered. Various consumer laws and regulations
also affect the operations of the Bank. In addition to the impact of
regulation, commercial banks are affected significantly by the actions of the
Federal Reserve Board as it attempts to control the money supply and credit
availability in order to influence the economy.
Capital Adequacy Guidelines
Bank holding companies are required to comply with the Federal Reserve
Board's risk-based capital guidelines. The required minimum ratio of total
capital to risk-weighted assets (including certain off-balance sheet
activities, such as standby letters of credit) is 8%. At least half of the
total capital is required to be "Tier 1 capital," consisting principally of
common shareholders' equity, less certain intangible assets. The remainder
("Tier 2 capital") may consist of certain preferred stock, a limited amount of
subordinated debt, certain hybrid capital instruments and other debt
securities, and a limited amount of the general loan loss allowance. The
risk-based capital guidelines are required to take adequate account of
interest rate risk, concentration of credit risk, and risks of nontraditional
activities.
In addition to the risk-based capital guidelines, the Federal Reserve
Board requires a bank holding company to maintain a leverage ratio of a
minimum level of Tier 1 capital (as determined under the risk-based capital
guidelines) equal to 3% of average total consolidated assets for those bank
holding companies which have the highest regulatory examination ratings and
are not contemplating or experiencing significant growth or expansion. All
other bank holding companies are required to maintain a ratio of at least 1%
to 2% above the stated minimum. The Bank is subject to almost identical
capital requirements adopted by the FDIC.
The Bank is also subject to PDOB capital guidelines. Although not
adopted in regulation form, the PDOB utilizes capital standards requiring a
minimum of 6% leverage capital and 10% risk-based capital. The components of
leverage and risk-based capital are substantially the same as those defined by
the FDIC.
Prompt Corrective Action Rules
The Federal Deposit Insurance Act (the "FDIA") requires each Federal
banking agency to specify by regulation the levels at which an insured
institution would be considered "well capitalized," "adequately capitalized,"
"undercapitalized," "significantly undercapitalized" and "critically
undercapitalized." The applicable federal bank regulator for a depository
institution can, under certain circumstances, reclassify a "well capitalized"
institution as "adequately capitalized" or require an "adequately capitalized"
or "undercapitalized" institution to comply with supervisory actions as if it
were in the next lower category. Such a reclassification could be made if the
regulatory agency determines that the institution is in an unsafe or unsound
condition (which could include unsatisfactory examination ratings). F&M Trust
meets the criteria to be "well capitalized" within the meaning of applicable
regulations.
Regulatory Restrictions on Dividends
Dividend payments by the Bank to the Corporation are subject to the
Pennsylvania Banking Code of 1965 (the "Banking Code"), the FDIA, and FDIC
regulations. Under the Banking Code, no dividends may be paid except from
"accumulated net earnings" (generally retained earnings). The Federal Reserve
Board and the FDIC have formal and informal policies which provide that
insured banks and bank holding companies should generally pay dividends only
out of current operating earnings, with some exceptions. Under the FDIA, no
dividends may be paid by an insured bank if the bank is in arrears in the
payment of any insurance assessment due to the FDIC. The Prompt Corrective
Action rules also limit the payment of dividends by banks which are not
classified as well capitalized or adequately capitalized.
Under these policies and subject to the restrictions applicable to the
Bank, the Bank could declare, during 1998, without prior regulatory approval,
aggregate dividends of approximately $1.032 million, plus retained net income
to the date of such dividend declaration.
FDIC Insurance Assessments
The FDIC has implemented a risk-related premium schedule for all insured
depository institutions that results in the assessment of premiums based on
capital and supervisory measures. Under the risk-related premium schedule,
the FDIC assigns, on a semiannual basis, each depository institution to one of
three capital groups (well-capitalized, adequately capitalized or
undercapitalized) and further assigns such institution to one of three
subgroups within a capital group. The institution's subgroup assignment is
based upon the FDIC's judgment of the institution's strength in light of
supervisory evaluations, including examination reports, statistical analyses
and other information relevant to measuring the risk posed by the institution.
Only institutions with a total capital to risk-adjusted assets ratio of 10% or
greater, a Tier 1 capital to risk-based assets ratio of 6% or greater, and a
Tier 1 leverage ratio of 5% or greater, are assigned to the well-capitalized
group. As of December 31, 1997, the Bank was well capitalized for purposes of
calculating insurance assessments.
The Bank Insurance Fund ("BIF") is presently fully funded at more than
the minimum amount required by law. Accordingly, the 1998 BIF assessment
rates range from zero for those institutions with the least risk, to $0.27 for
every $100 of insured deposits for institutions deemed to have the highest
risk. The Bank is in the category of institutions that presently pay nothing
for deposit insurance. The FDIC adjusts the rates every six months.
While the Bank presently pays no premiums for deposit insurance, it is
subject to assessments to pay the interest on Financing Corporation ("FICO")
bonds. FICO was created by Congress in 1989 to issue bonds to finance the
resolution of failed thrift institutions. Prior to 1997, only thrift
institutions were subject to assessments to raise funds to pay the FICO bonds.
On September 30, 1996, as part of the Omnibus Budget Act, Congress enacted the
Deposit Insurance Funds Act of 1996, which recapitalized the Savings
Association Insurance Fund ("SAIF") and provided that BIF deposits would be
subject to 1/5 of the assessment to which SAIF deposits are subject for FICO
bond payments through 1999. Beginning in 2000, BIF deposits and SAIF deposits
will be subject to the same assessment for FICO bonds. The FICO assessment
for 1998 for all depository institutions is expected to be $.0126 for each
$100 of BIF deposits and $.063 for each $100 of SAIF deposits. The FDIC sets
the FICO assessment rate every six months.
New Legislation
The Deposit Insurance Funds Act of 1996 was a part of the larger
Economic Growth and Regulatory Paperwork Reduction Act of 1996 ("EGRPRA").
EGRPRA is a lengthy Act that amends many different bank regulatory and
consumer protection statutes. While EGRPRA does not contain any major changes
to banking law (except for the FDIC and FICO assessments discussed above), it
does contain a number of smaller provisions that are beneficial to the banking
industry. In particular, certain routine regulatory application requirements
and procedures have been reduced or eliminated, making it easier and less
expensive for banks to comply with regulatory requirements. While the changes
effected by EGRPRA are welcome, the direct effect on the Corporation and the
Bank are expected to be minimal.
Proposed legislation is introduced in almost every legislative session
that would dramatically affect the regulation of the banking industry.
Whether or not such legislation will ever be enacted and what effect it may
have on the Corporation and the Bank cannot be estimated at this time.
Selected Statistical Information
Certain statistical information is included in the Corporation's 1997
Annual Report and is incorporated herein by reference
Description of Statistical Information Annual
Incorporated by Reference from the Report
1997 Annual Report Page
Net Interest Income 36
Analysis of Net Interest Income 37
Deposits by Major Classification 37
Rate-Volume Analysis of Net Interest Income 38
Investment Securities at Amortized Cost 41
Time Certificates of Deposit of $100,000 or More 41
Short-Term Borrowings 45
Loan Portfolio 45
Allocation of the Allowance for Possible Loan Losses 45
Non-Performing Assets 46
Allowance for Possible Loan Losses 46
Interest Rate Sensitivity 48
Sensitivity to Change in Market Interest Rates 49
Maturity Distribution of Investment Portfolio 49
Maturities and Interest Rate Terms of Loans 50
Item 2. Properties
The Corporation's headquarters is located in the main office of F&M
Trust at 20 South Main street, Chambersburg, Pennsylvania. The Corporation
owns five properties throughout Franklin County which are held for future
expansion and are currently used for banking operations by F&M Trust.
In addition to its main office, F&M Trust owns eleven and leases one
property, all of which are used for banking offices and operations. F&M
Trust also owns three properties which are held for expansion and are
currently leased to others.
Item 3. Legal Proceedings
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Part II
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters
The information related to this item is incorporated by reference to the
information appearing under Market and Dividend Information on Page 12 and
Shareholders' Information on Page 59 of the Corporation's 1997 Annual Report
to Shareholders.
Item 6. Selected Financial Data
The information related to this item is incorporated by reference to the
information under Summary of Selected Financial Data on Page 3 of the
Corporation's 1997 Annual Report to Shareholders.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The information related to this item is incorporated by reference to the
information appearing under Management's Discussion and Analysis on Pages 35
through 53 of the Corporation's 1997 Annual Report to Shareholders.
Item 7a. Quantitative and Qualitative Disclosures about Market Risk
The information related to this item is incorporated by reference to the
information appearing under Table 12 of Management's Discussion and Analysis on
Page 49 of the Corporation's 1997 Annual Report to Shareholders.
Item 8. Financial Statements and Supplementary Data
The information related to this item is incorporated by reference to the
information appearing under Financial Statements and Notes to Consolidated
Financial Statements, including the Report of Independent Public Accountants,
on Pages 13 through 30 of the Corporation's 1998 Annual Report to
Shareholders.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None.
Item 10. Directors and Executive Officers of the Registrant
The information related to this item is incorporated by reference to the
material set forth under the captions "Information about Nominees and
Continuing Directors" on Pages 4 through 6, and "Executive Officers" on Page 7
of the Corporation's Proxy Statement for the 1998 Annual Meeting of
Shareholders.
Item 11. Executive Compensation
The information related to this item is incorporated by reference to the
material set forth under the captions "Compensation of Directors" on Page 7
and "Executive Compensation and Related Matters" on Pages 7 through 12 of the
Corporation's Proxy Statement for the 1998 Annual Meeting of Shareholders,
except that information appearing under the captions "Committee Report on
Executive Compensation" and "Stock Performance Graph" on Pages 10 through 13
is not incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The information related to this item is incorporated by reference to the
material set forth under the captions "Voting of Shares and Principal Holders
Thereof" on Page 2 and "Information about Nominees and Continuing Directors"
on Pages 4 through 6 of the Corporation's Proxy Statement for the 1998 Annual
Meeting of Shareholders.
Item 13. Certain Relationships and Related Transactions
The information related to this item is incorporated by reference to the
material set forth under the caption "Transactions with Directors and
Executive Officers" on Page 13 of the Corporation's Proxy Statement for the
1998 Annual Meeting of Shareholders.
Part IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
(a) The following documents are filed as part of this report:
(1) The following Consolidated Financial Statements of the
Corporation are incorporated by reference to the 1997 Annual
Report to Shareholders:
Report of Independent Public Accountants;
Consolidated Balance Sheets - December 31, 1997 and 1996;
Consolidated Statement of Income - Years ended December 31,
1997, 1996, and 1995;
Consolidated Statements of Changes in Shareholders' Equity -
Years ended December 31, 1997, 1996, and 1995;
Notes to Consolidated Financial Statements.
(2) All financial statement schedules for which provision is
made in the applicable accounting regulations of the
Securities and Exchange Commission are not required under
the related instructions or are inapplicable and have
therefore been omitted.
(3) The following exhibits are being filed as part of this
report;
3.1 Articles of Incorporation of the Corporation.
Filed as Exhibit 4 to Registration Statement on Form
S-8 (No.33-36509) and incorporated herein by
reference.
3.2 Bylaws of the Corporation.
Filed as Exhibit 4 to Registration Statement on Form
S-8 (No.33-36509) and incorporated herein by
reference.
10.1 Deferred Compensation Agreements with Bank Directors.
Filed as Exhibit 10.1 to the 1995 Form 10-K -- Annual
Report of the Corporation and incorporated herein by
reference.
10.2 Director's Deferred Compensation Plan. Filed as
Exhibit 10.2 to the 1995 Form 10-K -- Annual Report of
the Corporation and incorporated herein by reference.
10.3 Long-Term Incentive Plan of 1990. Filed as Exhibit
10.3 to the 1995 Form 10-K -- Annual Report of the
Corporation and incorporated herein by reference.
10.4 Senior Management Incentive Program, as amended,
October 15, 1992. Filed as Exhibit 10.5 to the 1993
Form 10-K -- Annual report of the Corporation and
incorporated herein by reference.
13 The 1997 Annual Report to Shareholders of the
Corporation.
21 Subsidiaries of the Corporation.
23 Consent of Arthur Andersen LLP
27 Financial Data Schedule
(b) Reports on Form 8-K:
A current report on Form 8-K, dated November 13, 1997 was filed on
November 17,1997 in conjunction with the declaration of a three for
two stock split to be issued in the form of a 50% stock dividend.
(c) The exhibits required to be filed as part of this report are
submitted as a separate section of this report.
(d) Financial Statement Schedules: None.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
and Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
FRANKLIN FINANCIAL SERVICES
CORPORATION
By:______________________________________
William E. Snell, Jr.
President and Chief Executive Officer
Date: March 26, 1998
Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Signature Title Date
______________________________ Chairman of the Board March 26, 1998
Jay L. Benedict, Jr. and Director
______________________________ Vice Chairman March 26, 1998
Robert G. Zullinger and Director
______________________________ President and Chief March 26, 1998
William E. Snell, Jr. Executive Officer
and Director
______________________________ Executive Vice March 26, 1998
Charles S. Bender II President and Director
______________________________ Treasurer and Chief March 26, 1998
Elaine G. Meyers Financial Officer
(Principal Financial and
Accounting Officer)
______________________________ Director March 26, 1998
G. Warren Elliott
______________________________ Director March 26,1998
Omer L. Eshleman
______________________________ Director March 26,1998
Dennis W. Good, Jr.
______________________________ Director March 26,1998
H. Huber McCleary
______________________________ Director March 26,1998
Jeryl C. Miller
______________________________ Director March 26,1998
Stephen E. Patterson
______________________________ Director March 26,1998
Charles M. Sioberg
______________________________ Director March 26,1998
Martha B. Walker
Exhibit Index for the Year
Ended December 31, 1997
Item Description
3.1 Articles of Incorporation of the Corporation.
Filed as Exhibit 4 Registration on Form S-8
(No. 33-36509) and incorporated
herein by reference.
3.2 Bylaws of the Corporation.
Filed as Exhibit 4 Registration on Form S-8
(No. 33-36509) and incorporated
herein by reference.
10.1 Deferred Compensation Agreements with Bank Directors.
Filed as Exhibit 10.1 to the 1995 Form 10-K -- Annual Report
of the Corporation and incorporated herein by reference.
10.2 Director's Deferred Compensation Plan.
Filed as Exhibit 10.2 to the 1995 Form 10-K -- Annual Report
of the Corporation and incorporated herein by reference.
10.3 Long-Term Incentive Plan of 1990.
Filed as Exhibit 10.3 to the 1995 Form 10-K -- Annual Report
of the Corporation and incorporated herein by reference.
10.4 Senior Management Incentive Program, as amended,
October 15, 1992. Filed as Exhibit 10.5 to the 1993
Form 10-K -- Annual Report of the Corporation and
incorporated herein by reference.
13 The 1997 Annual Report to Shareholders of the Corporation
21 Subsidiaries of Corporation
23 Consent of Arthur Andersen LLP
27 Financial Data Schedule