2400 First Indiana Plaza
135 North Pennsylvania Street
Indianapolis, IN 46204-2452



Independent Auditors' Report



The Board of Directors
1ST RANCORP:


We have audited the accompanying  consolidated  statement of financial condition
of 1ST BANCORP and subsidiaries as of June 30, 1998 and the related consolidated
statements  of  earnings,  stockholders'  equity  and cash flows for each of the
years in the two-year period ended June 30, 1998. These  consolidated  financial
statements  are  the  responsibility  of  the  Corporation's   management.   Our
responsibility  is  to  express  an  opinion  on  these  consolidated  financial
statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the  financial  position of 1ST BANCORP and
subsidiaries as of June 30, 1998, and the results of their  operations and their
cash flows for each of the years in the  two-year  period ended June 30, 1998 in
conformity with generally accepted accounting principles.



KPMG LLP

Indianapolis, Indiana
July 23, 1998 except as to note 17,
which is as of August 6, 1998