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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [_]

Check the appropriate box:

[X] Preliminary Proxy Statement

[_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))

[_] Definitive Proxy Statement

[_] Definitive Additional Materials

[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12

Superior Financial Corp.
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(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

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(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):

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(4) Proposed maximum aggregate value of transaction:

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(5) Total fee paid:

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[_] Fee paid previously with preliminary materials.

[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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(2) Form, Schedule or Registration Statement No.:

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(3) Filing Party:

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(4) Date Filed:

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Notes:

Reg. (S) 240.14a-101.

SEC 1913 (3-99)

TO OUR STOCKHOLDERS:

The annual meeting of the stockholders of Superior Financial Corp. will be
held at 2:00 p.m., Wednesday, May 17, 2000, at 5000 Rogers Avenue Fort Smith,
Arkansas.

Enclosed is the notice of the meeting, a proxy statement, a proxy card,
Superior's Annual Report to its Stockholders and Superior's Annual Report on
Form 10-K. We hope that you will study the enclosed material carefully and
attend the meeting in person.

Whether you plan to attend the meeting or not, please sign and date the
enclosed proxy card and return it in the accompanying envelope as promptly as
possible. Please indicate in the space provided on the proxy card whether or
not you plan to attend the meeting in person. The proxy may be revoked by your
vote in person at the meeting, by your execution and submission of a later
dated proxy, or by your giving written notice of revocation to the Secretary of
Superior Financial Corp. at any time prior to the voting thereof. Thank you for
your support.

Sincerely,

C. Stanley Bailey
Chairman of the Board and Chief
Executive Officer

April 14, 2000

NOTICE

of the

ANNUAL MEETING OF STOCKHOLDERS

Superior Financial Corp.

To Be Held May 17, 2000

NOTICE IS HEREBY GIVEN that the annual meeting of stockholders of Superior
Financial Corp. ("Superior"), a Delaware corporation, will be held at 5000
Rogers Avenue, Fort Smith, Arkansas, on Wednesday, May 17, 2000, at 2:00 p.m.,
central daylight time, for the following purposes:

1. To elect the nominees named in the Proxy Statement as directors to serve
for a term of one year.

2. To approve an amendment to Superior's Restated and Amended Certificate
of Incorporation reducing the number of authorized shares of Preferred
Stock from 10,000,000 to 1,000,000 and making certain other formal
revisions.

3. To ratify the accounting firm of Ernst & Young LLP as Superior's
independent auditors.

4. To transact such other business as may properly come before the meeting
or any adjournments thereof, but which is not now anticipated.

These matters are discussed in detail in the accompanying proxy statement.
Only stockholders of record at the close of business on March 31, 2000, will be
entitled to notice of, and to vote at, the meeting. A complete list of the
stockholders entitled to vote at the meeting, arranged in alphabetical order
and showing the address of each stockholder and the number of shares registered
in the name of each stockholder, shall be open for examination by any
stockholder at Superior's office at 5000 Rogers Avenue, Fort Smith, Arkansas,
during ordinary business hours for any purpose germane to the meeting. Such
list will be open for a period of at least ten days prior to the meeting.

All stockholders of Superior are cordially invited to attend the meeting in
person. WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON, PLEASE SIGN
AND DATE THE ENCLOSED PROXY CARD AND RETURN IT IN THE ACCOMPANYING ENVELOPE AS
PROMPTLY AS POSSIBLE. THE PROXY MAY BE REVOKED BY YOUR VOTE IN PERSON AT THE
MEETING, BY YOUR EXECUTION AND SUBMISSION OF A LATER DATED PROXY, OR BY YOUR
GIVING WRITTEN NOTICE OF REVOCATION TO THE SECRETARY OF SUPERIOR AT ANY TIME
PRIOR TO THE VOTING THEREOF.

By Order of the Board of Directors

C. Stanley Bailey
Chairman of the Board
and Chief Executive Officer

April 14, 2000

Superior Financial Corp.
16101 LaGrande Drive
Suite 103
Little Rock, Arkansas 72223
Telephone: (501) 324-7282

PROXY STATEMENT
FOR 2000 ANNUAL MEETING OF STOCKHOLDERS

This Proxy Statement and the accompanying proxy are furnished on or about
April 14, 2000, by Superior Financial Corp. ("Superior") to the holders of
record of common stock, par value $0.01, of Superior (the "Common Stock") in
connection with the annual meeting of Superior's stockholders and any
adjournments thereof (the "Annual Meeting") to be held on Wednesday, May 17,
2000, at 5000 Rogers Avenue, Fort Smith, Arkansas. The matters to be considered
and acted upon, including the election of directors, approval of an amendment
to Superior's Amended and Restated Certificate of Incorporation and
ratification of Ernst & Young LLP as Superior's independent auditors, are
discussed herein.

The Board of Directors of Superior (the "Board") recommends the election of
the eight director-nominees named in this Proxy Statement for a term of one
year and approval of the amendment to its Amended and Restated Certificate of
Incorporation (the "Certificate").

The enclosed proxy is solicited on behalf of the Board and is revocable at
any time prior to the voting of such proxy by giving written notice of
revocation to the Secretary of Superior, or by executing and submitting a later
dated proxy, or by voting in person at the Annual Meeting. Mere attendance at
the Annual Meeting without submitting a later dated proxy will not be
sufficient to revoke a previously submitted proxy. All properly executed
proxies delivered pursuant to this solicitation will be voted at the Annual
Meeting and in accordance with instructions, if any. If no instructions are
given, the proxies will be voted FOR election of the director-nominees named
herein, FOR approval of the amendment to the Certificate FOR ratification of
Ernst & Young LLP as Superior's independent auditors and in accordance with the
instructions of management as to any other matters that may come before the
Annual Meeting.

Superior will pay the cost of soliciting proxies. In addition to the use of
the mails, proxies may be solicited by personal interview, telephone or
electronic communication. Banks, brokers, nominees or fiduciaries will be
required to forward the soliciting material to the principals and to obtain
authorization of the execution of proxies. Superior may, upon request,
reimburse banks, brokers and other institutions, nominees and fiduciaries for
their expenses in forwarding proxy material to the principals.

Stockholders Eligible to Vote

This Proxy Statement is furnished to the holders of Common Stock who were
holders of record as of the close of business on March 31, 2000. Only those
holders are eligible to vote at the Annual Meeting. As of March 31, 2000 there
were outstanding 9,832,108 shares of Common Stock.

Votes will be tabulated and counted by one or more inspectors of election
appointed by the Chairman of the Board. Proxies marked as abstentions and
shares held in street name which have been designated by brokers on proxy cards
as not voted will not be counted as votes cast. Such proxies will be counted
for purposes of determining a quorum at the Annual Meeting. A quorum consists
of a majority of the shares of Common Stock outstanding.

VOTING SECURITIES AND PRINCIPAL STOCKHOLDERS

Principal Stockholders

The following table sets forth certain information regarding the beneficial
ownership of the Common Stock as of March 31, 2000 by each person of record
believed by Superior to own beneficially 5% or more of the Common Stock.

Number Percentage
of Beneficially
Name Shares Owned
---- ------- ------------

Financial Stocks, Inc(1)................................... 547,500 5.56%
Franklin Mutual Advisers, LLC.............................. 737,000 7.49
Keefe, Bruyette & Woods, Inc............................... 716,083 7.28
Oz Master Fund, Ltd........................................ 595,000 6.05
Steven N. Stein(1)......................................... 577,600 5.87
Alexander D. Warm(1)....................................... 537,100 5.46
Whiting & Co............................................... 495,000 5.03

- --------
(1) John M. Stein, a director of Superior, and Steven N. Stein, a principal
shareholder of Superior, are directors, executive Officers and principal
stockholders of Financial Stocks, Inc. Alexander D. Warm, who is the
beneficial owner of 537,100 shares of Common Stock, and Stanley L. Vigran,
who owns 30,000 shares of Common Stock are the remaining directors and
shareholders of Financial Stocks, Inc., which is a general partner and
investment manager of certain investment funds, including Vine Street
Exchange Fund, L. P., which owns 312,500 shares of Common Stock, and
Financial Stocks Private Equity Fund 1998 L.P., which owns 235,000 shares
of Common Stock. John M Stein and Steven N. Stein are brothers. Alexander
D. Warm and Stuart E. Warm, who owns 20,000 shares of Common Stock, are
brothers. Steven N. Stein and John M. Stein each disclaim any ownership of
Common Stock held by the other. Alexander D. Warm and Stuart E. Warm each
disclaim any ownership of Common Stock held by the other.

SECURITY OWNERSHIP OF MANAGEMENT AND DIRECTORS

The following table sets forth certain information regarding the beneficial
ownership of the Common Stock as of March 31, 2000 by each director and each
executive officer, and all directors and executive officers as a group.

Percentage
Number of Beneficially
Name Shares Owned
---- --------- ------------

C. Stanley Bailey..................................... 591,666(1) 5.73%
Brian A. Gahr......................................... 100 *
Rick D. Gardner....................................... 6,385(2) *
Boyd W. Hendrickson................................... -- *
Howard B. McMahon..................................... 3,000 *
C. Marvin Scott....................................... 244,250(3) 2.42%
Ben F. Scroggin....................................... 2,000 *
John M. Stein......................................... 160,800(4) 1.64%
John E. Steuri........................................ 8,000 *
David E. Stubblefield................................. 12,000 *
Officers and Directors as a Group..................... 1,028,201 10.46%

- --------
* Represents less than 1%
(1) Includes 487,500 shares of Common Stock subject to stock options, 47,748
shares held jointly by Mr. Bailey and his wife Virginia H. Bailey, 10,316
shares held in Mrs. Bailey's IRA and 1,650 shares held in the Mary Brittan
Bailey Trust.
(2) Includes 1,385 shares of Common Stock subject to stock options.
(3) Includes 243,750 shares of Common Stock subject to stock options.
(4) John M. Stein, a director of Superior, and Steven N. Stein, a principal
shareholder of Superior, are directors, executive officers and principal
shareholders of Financial Stocks, Inc. Alexander D. Warm, who is the
beneficial owner of 537,100 shares of Common Stock, and Stanley L. Vigran,
who owns 30,000 shares of the Common Stock, are the remaining directors
and shareholders of Financial Stocks, Inc. Financial Stocks, Inc. is a
general partner and investment manager of certain investments funds,
including Vine Street Exchange Fund, L.P., which owns 312,500 shares of
Common Stock, and Financial Stocks Private Equity Fund 1998 L.P., which
owns 235,000 share of Common Stock. Steven N. Stein and John M. Stein are
brothers. Alexander D. Warm and Stuart E. Warm, who owns 20,000 shares of
Common Stock, are brothers. Steven N. Stein and John M. Stein each
disclaim any ownership of Common Stock held by the other. Alexander D.
Warm and Stuart E. Warm each disclaim any ownership of Common Stock held
by the other.

ELECTION OF DIRECTORS

The Board recommends that the stockholders elect the eight persons named
below to hold office for the term of one year, or until their successors are
elected and qualified. Superior's Restated Certificate of Incorporation
provides that the number of directors which shall constitute the entire Board
shall be fixed from time to time by resolutions adopted by the Board, but shall
not be less than three persons.

If, prior to the voting at the Annual Meeting, any person proposed for
election as a director is unavailable to serve or for good cause cannot serve,
the shares represented by all valid proxies may be voted for the election of
such substitute as the members of the Board may recommend. Superior's
management knows of no reason why any person would be unavailable or unable to
serve as a director.

Assuming a quorum is present at the Annual Meeting, a plurality of the votes
cast will be sufficient to elect the directors. On the proxy card, voting for
directors is Proposal 1.

The bylaws of Superior contain certain limitations on stockholder
nominations of candidates for election as directors. See "Bylaw Provisions
Regarding Conduct of Stockholders' Meetings."

The following table provides certain biographical information about each
nominee to be proposed on behalf of the Board. Unless otherwise indicated, each
person has been engaged in the principal occupation shown for the last five
years. Executive officers serve at the discretion of the Board.

DIRECTORS TO BE NOMINATED ON BEHALF OF THE BOARD FOR A TERM OF ONE YEAR

Position and Office Held with
Name, Age and Year Superior and Superior Federal Present and Principal Occupation for the Last
Became Director Bank, F.S.B. Five Years
------------------ ---------------------------- ------------------------------------------------

C. Stanley Bailey* Chairman of the Board, Chief Chief Financial Officer and Executive Vice
51, 1998............ Executive Officer of both President of Hancock Holding Company and Hancock
Superior and Superior Bank, Gulfport, Mississippi,1995-1998, Vice
Federal Bank, F.S.B. Chairman of the Board of Directors, AmSouth
Bancorporation and AmSouth Bank, Birmingham,
Alabama 1971-1994
C. Marvin Scott* President, Chief Operating Chief Retail Officer and Senior Vice President,
50, 1998............ Officer and Director of both Hancock Holding Company and Hancock Bank,
Superior and Superior Gulfport Mississippi, 1996-1998; Executive Vice
Federal Bank, F.S.B. President--Consumer Banking, AmSouth Bank
Birmingham, Alabama
1988-1996
Brian A. Gahr Director of Superior and
45, 1999............ Superior Federal Bank, Division Vice President of Whirlpool Corp. since
F.S.B. 1978 in Fort Smith, Arkansas
Howard B. McMahon Director of Superior; Owner of SSI, Inc., a general contractor in Fort
61, 1999............ director of Superior Federal Smith, Arkansas
Bank, F.S.B. since 1995
Ben F. Scroggin, Jr Director of Superior; Retired banker
79, 2000............ director of Superior Federal
Bank, F.S.B. since 1964
John M. Stein Director of Superior and President, Financial Stocks, Inc., Cincinnati,
33, 1998............ Superior Federal Bank, Ohio; Vice President; Bankers Trust Company, New
F.S.B. York, New York, 1993-1995
John E. Steuri Director of Superior and Chairman of Advance Thermal Technologies, Inc.
60, 1999............ Superior Federal Bank, (Air Conditioning/Dehumidification equipment for
F.S.B. businesses), former Chairman, President & CEO of
ALLTEL Information Systems from 1988 to 1996
David E. Stubblefield Director of Superior; President and Chief Executive Officer ABF
63, 1998............ director of Superior Federal Freight System, Inc.
Bank, F.S.B. since 1994

- --------
* Indicates that the director/nominee is also an executive officer.

The Board of Directors has established audit, compensation and loan and
investment committees. The Audit Committee currently consists of Messrs.
McMahon, Gahr, Hendrickson, Scroggin and Stein, none of whom is an employee of
Superior. The Audit Committee reviews the general scope of the audit conducted
by Superior's independent auditors, the fees charged for their work and matters
relating to Superior's internal control systems. In performing its functions,
the Audit Committee meets separately with representatives of Superior's
independent auditors, with Superior's internal auditors and with
representatives of senior management.

systems. In performing its functions, the Audit Committee meets separately with
representatives of Superior's independent auditors, with Superior's internal
auditors and with representatives of senior management.

The Compensation Committee currently consists of Messrs. Stein, Hendrickson,
Steuri, and Stubblefield, none of whom is an employee of Superior. The
Compensation Committee administers Superior stock option plans and grants
options and other awards to company employees under such plans. In addition,
the Compensation Committee is responsible for establishing of policies dealing
with various compensation and employee benefit matters of Superior.

The Loan and Investment Committee presently consists of Messrs.
Stubblefield, Gahr, McMahon Scroggin and Steuri. The Loan and Investment
Committee oversees loan and investment policies and activities and reviews and
approves loan relationships of $2,000,000 and greater.

Superior has no nominating committee.

During 1999, the Board met 9 times. All directors attended 75% or more of
these meetings, plus meetings of committees of the Board on which they served.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires Superior
directors, certain officers and 10% stockholders to file reports of ownership
and changes in ownership with the Securities and Exchange Commission (the
"SEC"). Such officers, directors and 10% stockholders are required by SEC
regulations to furnish Superior with copies of all Section 16(a) reports they
file, including initial reports on Form 3 and annual reports on Form 5.

Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no reports on Form
5 were required for those persons, Superior believes that during 1999 all
filings applicable to its officers, directors and 10% stockholders were made
timely, except in connection with the purchase of 100 shares of Common Stock by
Brian A. Gahr in December 1999.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The Compensation Committee Currently consists of Messrs. Stein, Hendrickson,
Steuri and Stubblefield, none of whom is an employee of Superior. Before the
formation of the Compensation Committee, and in connection with the
acquisition, Messrs. Bailey and Scott negotiated their respective employment
agreements with the lead Investor and the Placement Agent, each of whom is a
principal shareholder. See "--Employment Agreements."

Other Transactions--Loans

Certain directors, officers and principal shareholders of Superior and their
affiliated interests were customers of and had transactions with Superior
Federal Bank, F.S.B. (the "Bank") in the ordinary course of business;
additional transactions may be expected to take place in the ordinary course of
business. Included in such transactions were outstanding loans and commitments
from the Bank, all of which were made in the ordinary course of business on
substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other persons and did
not involve more than normal risk of collectability or present other
unfavorable features.

Director Compensation

Directors of Superior and the Bank currently receive fees of $1,000 for each
Board meeting of each entity attended. Members of committees of Superior and
the Bank receive fees of $250 for each committee meeting attended. All of the
directors of Superior also serve as directors of the Bank. Fees paid to
directors of Superior for their services as directors of the Bank or as
directors of Superior totaled $78,400 in 1999.

EXECUTIVE COMPENSATION
And Other Information

The following table provides certain summary information concerning
compensation paid or accrued by Superior to or on behalf of Superior's Chairman
of the Board and Chief Executive Officer and the only other two executive
officers of Superior who were paid or otherwise compensated in excess of
$100,000 in 1999. No information is given for 1997 because Superior was not
organized until 1997, and no executive compensation was paid until 1998.

Annual Long Term Compensation
Compensation Awards
--------------------- ----------------------
Restricted Securities
Name and Principal Stock Underlying All Other
Position Year Salary($) Bonus($) Awards ($) Options (#) Compensation
------------------ ---- --------- -------- ---------- ----------- ------------

C. Stanley Bailey....... 1999 $250,000 $125,000 -- 31,250 *
Chairman and CEO 1998 225,000 56,250 -- 487,500(2) *

C. Marvin Scott......... 1999 170,000 85,000 -- 20,732
President and Chief
Operating 1998 150,000 37,500 -- 243,750(2) *
Officer

Rick D. Gardner......... 1999 125,000 35,938 -- 6,830
Chief Financial Officer 1998 125,000(1) 5,889(1) -- 5,540(2) *

- --------
* Does not include amounts attributable to miscellaneous benefits received by
the named officers. The costs of providing such benefits to the named
officers for the years ended 1999 and 1998 did not exceed the lesser of
$50,000 or 10% of the total annual salary and bonus reported.
(1) Mr. Gardner joined Superior on September 21, 1998. The salary given for
each of 1999 and 1998 represents annualized base salary. The 1999 and 1998
bonuses represent amounts actually paid in relation to 1999 and 1998
employment, respectively.
(2) Represents options granted to Messrs. Bailey, Scott and Gardner on
December 22, 1997, January 9, 1998 and September 21, 1998, respectively.
The exercise price $10.00 per share with respect to options held by Mr.
Bailey and Mr. Scott and is $10.83 with respect to options held by Mr.
Gardner.

Stock Option Plans

Superior adopted the Incentive Plan on June 17, 1998. It was ratified by the
stockholders at the 1999 Annual Meeting. The Incentive Plan is an omnibus plan
administered by the Compensation Committee to provide equity-based incentive
compensation for Superior's key employees. It provides for issuance of
incentive stock options, qualified under Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code"), and non-qualified stock options. The
Incentive Plan also provides for issuance of stock appreciation rights, whether
in tandem with options or separately, and awards of restricted shares subject
to time-based restrictions and/or performance goals.

The Incentive Plan imposes a limit on the total number of shares that may be
issued during the ten-year term of the Incentive Plan equal to 10% of the
number of shares outstanding as of December 31, 1999. It imposes a limit on the
number of awards that may be granted to all employees in any one calendar year
equal to 1% of the number of shares outstanding on December 31, 1998. On that
date there were 10,080,503 shares of Common Stock outstanding. Finally, the
Incentive Plan limits the number of restricted stock awards that may be granted
each year, which are time-based restricted only (i.e., without regard to any
performance goals), to a number of shares equal to .33% (one-third of one
percent) of the number of shares outstanding on December 31, 1998.

Each award is non-transferrable during the life of the employee, except as
permitted by the Compensation Committee to the employee's family or a trust for
the employee's family. The awards do not create a right to employment. Upon a
change in control of Superior any vesting schedules and performance goals are
deemed satisfied.

As discussed further below, options were granted to Mr. Bailey and Mr. Scott
pursuant to their Founder's Agreements and Employment Agreements, respectively.
Those options were issued before adoption of the Incentive Plan by Superior's
Board and, therefore, are non-qualified stock options. They have not been
issued pursuant to the Incentive Plan.

Options

The following table shows certain information respecting exercised and
unexercised options for Common Stock held by Superior executive officers at
December 31, 1999. Certain options have been granted pursuant to a performance
based vesting schedule which only permits the holder to exercise a portion of
his or her options upon accomplishing pre-defined levels of stock price
performance.

Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option
Values

Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options At Options At
December 31, December 31,
1999 1999(2)
-------------- ---------------
Shares
Acquired On Value Exercisable/ Exercisable/
Exercise(#) Realized ($)(1) Unexercisable Unexercisable
----------- --------------- -------------- ---------------

C. Stanley Bailey... -- -- 487,500/31,250 $548,437/23,437
C. Marvin Scott..... -- -- 243,750/20,732 274,219/15,549
Rick D. Gardner..... -- -- 1,385/10,985 408/6,348

- --------
(1) Value realized is the difference between the fair market value of the
securities underlying the options and the exercise price on the date of
exercise. No options had been exercised as of December 31, 1999.
(2) Value is calculated by subtracting the exercise price from the market value
of underlying securities at December 31, 1999. The market value for the
Common Stock as of December 31, 1999 was $11.125.

The following table shows certain information respecting grants of options
respecting Common Stock to certain executive officers of Superior during 1999.

Option Grants in Last Fiscal Year

Individual Grants
----------------------
Potential
Realizable Value
Percent of at Assumed Annual
Total Market Rates of Stock
Number of Options Price Price
Securities Granted to Exercise on Appreciation for
Underlying Employees or Base Date Option Term
Options in Fiscal Price of Expiration -----------------
Name Granted (#) Year ($/Sh) Grant Date 5%($) 10%($)
- ---- ----------- ---------- -------- ------ ---------- -------- --------

C. Stanley Bailey....... 31,250 32.7% $10.375 10.375 April 2009 $503,000 $764,000
C. Marvin Scott......... 20,732 21.7 10.375 10.375 April 2009 334,000 507,000
Rick D. Gardner......... 6,830 7.1 10.375 10.375 April 2009 110,000 167,000

Employment Agreements

Mr. Bailey has an employment agreement with Superior which provides, among
other things, that Mr. Bailey serve as the Chairman of the Board of Directors
and Chief Executive Officer of Superior and the Bank for an initial term of
employment of three years. Pursuant to the agreement, Mr. Bailey has been
granted options to acquire 487,500 shares of Common Stock, or 5% of the shares
of Common Stock issued and outstanding. The exercise price of such options is $
10.00 per share.

Mr. Scott has an agreement with Superior which provides, among other things,
that Mr. Scott serve as the President of Superior and the Bank. Pursuant to the
agreement Mr. Scott has been granted options to acquire 243,750 shares of
Common Stock, or 2.5% of the shares of Common Stock issued and outstanding. The
exercise price of such options is $10.00 per share.

Mr. Gardner has an agreement with Superior dated September 21, 1998 to serve
as Superior's and the Bank's Chief Financial Officer. He is entitled to receive
an annual base salary and bonuses of up to 50% of base salary, with a targeted
payout of 30%, if the Bank achieves certain performance goals. Pursuant to the
agreement, he has been granted options to acquire 5,540 shares of Common Stock,
subject to certain vesting requirements. The exercise price of the options is
$10.83.

Superior has agreed with each of Mr. Bailey, Mr. Scott and Mr. Gardner to
pay certain severance benefits upon a change of control of Superior. A change
of control is defined for this purpose as the occurrence of a transaction the
result of which is that more than 25% of the outstanding shares of Common Stock
(or a successor or parent) are acquired by any person, entity or group acting
in concert, which before the transaction, owned less than 25% of the
outstanding shares of the Common Stock. In the event of a change of control,
Mr. Bailey will be entitled to receive, subject to Section 280(g) of the
Internal Revenue Code of 1986, as amended, an amount equal to three times his
total compensation for the preceding 12 months. Each of Mr. Scott and Mr.
Gardner will be entitled to receive, respectively, an amount equal 2.99 times
his total compensation for the preceding 12 months.

Benefit Plan

Superior has established a contributory profit sharing plan pursuant to
Section 401(k) of the Code covering substantially all employees (the "Plan").
Superior is the Plan administrator and investment advisor, and Capital Guardian
serves as the Plan's trustee. Each year Superior determines, at its discretion,
the amount of matching contributions not to exceed 6% of the employee's annual
compensation vesting ratably over a four year period. Total Plan expenses
charged to Superior's operations for 1999 were $257,868.

Interests of Management and Others in Certain Transactions

Mr. Bailey, Mr. Scott and Mr. Gardner have entered into employment
agreements with Superior. These agreements provide, among other things, that
each of them is entitled to receive options to acquire shares of Common Stock
pursuant to a vesting schedule determined by the occurrence of certain events.
See "--Employment Agreements."

COMPENSATION COMMITTEE REPORT

The Compensation Committee consists of John M. Stein, Boyd W. Hendrickson,
John E. Steuri and David E. Stubblefield, none of whom is an employee of
Superior or the Bank. The committee reviews and determines cash compensation of
executive officers of Superior.

Compensation Principles

The committee determines executive compensation in accordance with five
principles: (1) Superior's financial performance measured against attainment of
Superior's business goals and the performance of peer-group institutions; (2)
the competitiveness of executive compensation with Superior's peers; (3) the
encouragement of stock ownership of management; (4) the individual performance
of each executive officer; and (5) recommendations by the Chief Executive
Officer regarding all executive officers other than himself. No
disproportionate weight is assigned to any individual principle.

1999 Compensation

Compensation in 1999 for executive officers, including the Chief Executive
Officer, was negotiated in connection with their initial employment by
Superior. The terms of such compensation are set forth in employment
agreements. See "--Employment Agreements."

Stock Awards

Certain stock awards to Mr. Bailey, Mr. Scott and Mr. Gardner are governed
by the terms of their employment agreements. See "--Employment Agreements."

This foregoing report is submitted by the compensation committee.

Committee:

John M. Stein
Boyd W. Hendrickson
John E. Steuri
David E. Stubblefield

Performance Graph

[GRAPHIC OF COMPARE CUMULATIVE TOTAL RETURN TO APPEAR HERE]

COMPANY/INDEX/MARKET 2/8/99 3/31/99 6/30/99 9/30/99 12/31/99
------- ------- ------- ------- --------
Superior Financial Group $100.00 $85.56 $97.78 $106.67 $98.89
NASDAQ Bank Index $100.00 $100.63 $108.00 $98.29 $100.85
NASDAQ Market Index-U.S. Cos. $100.00 $102.08 $111.64 $114.22 $165.78

Neither the foregoing graph nor the Compensation Committee Report is to be
deemed to be incorporated by reference into any past or subsequent filings by
Superior under the Securities Act of 1933 or the Securities Exchange Act of
1934.

APPROVAL OF AN AMENDMENT TO THE
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

Summary of the Amendment

Article 4 of Superior's Amended and Restated Certificate of Incorporation
authorizes 10,000,000 shares of Preferred Stock. None of the shares of
Preferred Stock have been issued. Article 4 also provides that holders of
Common Stock and Preferred Stock shall not have preemptive rights to subscribe
for additional stock if Superior issues additional shares. Delaware law
currently provides that stockholders do not have preemptive rights unless a
Corporation's certificate of incorporation expressly provides for them. The
amendment will reduce the number of authorized shares of Preferred Stock to
1,000,000 and will delete subparagraph (1) of Part B of Article 4 which
prohibits preemptive rights. The amendment also reformats Article 4 by
eliminating its division into Parts A and B.

Reasons for the Amendment

Superior's Delaware franchise tax is calculated upon the number of
authorized shares of all classes of stock. Reducing the number of authorized
shares of Preferred Stock should materially reduce Superior's franchise tax
bill under current law. The Board has never authorized the issuance of shares
of Preferred Stock and does not anticipate doing so in the near future. The
Board has also concluded that the availability of 1,000,000 shares of
authorized Preferred Stock should be adequate, if issuance of such shares were
deemed to be in the best interests of Superior.

The deletion of the prohibition against preemptive rights and the related
reformatting of Article 4 are essentially ministerial. Section B(1) of Article
4 merely restates what is currently the law in Delaware. Its deletion will not
change the rights of stockholders. Therefore, the Board has concluded that
Section B(1) is surplusage and should be deleted.

Text of Article 4 as Amended

Set forth below is the full text of Article 4 as amended.

ARTICLE 4

(1) The total number of shares of all classes of stock which the corporation
shall have authority to issue is 21,000,000 shares, of which 1,000,000 shares
of the par value of $0.01 per share are to be Preferred Stock (hereinafter
called "Preferred Stock") and 20,000,000 shares of the par value of $0.01 per
share are to be Common Stock (hereinafter sometimes called "Common Stock").

(2) (a) The Preferred Stock may be issued in such one or more series as
shall from time to time be created and authorized to be issued by the board of
directors as hereinafter provided.

(b) The board of directors is hereby expressly authorized, by resolution
or resolutions from time to time adopted providing for the issuance of
Preferred Stock, to fix and state, to the extent not fixed by the
provisions hereinafter set forth, the designations, powers, preferences and
relative, participating, optional and other special rights of the shares of
each series of Preferred Stock, and the qualifications, limitations and
restrictions thereof, including (but, unless otherwise stated below,
without limiting the generality of the foregoing) any of the following with
respect to which the board of directors shall determine to make affirmative
provisions:

(i) the distinctive name and serial designation;

(ii) the annual dividend rate or rates and the dividend payment
dates;

(iii) whether dividends are to be cumulative or non-cumulative and
the participating or other special rights, if any, with respect to the
payment of dividends;

(iv) whether any series shall be subject to redemption and, if so,
the manner of redemption and the redemption price or prices;

(v) the amount or amounts of preferential or other payments to which
any series is entitled over any other series or over the Common Stock
on voluntary liquidation, dissolution or winding up of the corporation;

(vi) any sinking fund or other retirement provisions and the extent
to which the charges therefor are to have priority over the payment of
dividends on or the making of sinking fund or other like retirement
provisions for shares of any other series or other dividends on the
Common Stock;

(vii) any conversion, exchange, purchase or other privileges to
acquire shares of any other series or of the Common Stock;

(viii) the number of shares of such series; and

(ix) the voting rights, if any, of such series, including the right
of such Preferred Stock to class voting or the right to vote together
with the Common Stock, with such number of votes per share, or
fractions of a share, as shall be determined by the board of directors,
on any matter to be presented to the stockholders.

(c) Each share of each series of Preferred Stock shall have the same
relative rights and be identical in all respects with all the other shares
of the same series.

(d) Before the corporation shall issue any shares of Preferred Stock of
any series authorized as hereinbefore provided, a certificate setting forth
a copy of the resolution or resolutions with respect to such series adopted
by the board of directors of the corporation pursuant to the foregoing
authority vested in the board of directors shall be made, filed and
recorded in accordance with the then applicable requirements, if any, of
the laws of the State of Delaware, or, if no certificate is then so
required, such certificate shall be signed and acknowledged on behalf of
the corporation by its Chairman of the Board of Directors, President or a
Vice-President and its corporate seal shall be affixed thereto and attested
by its Secretary or an Assistant Secretary and such certificate shall be
filed and kept on file at the principal office of the corporation in the
State of Delaware and in such other places as the board of directors shall
designate.

(e) Shares of any series of Preferred Stock which shall be issued and
thereafter acquired by the corporation through purchase, redemption,
conversion or otherwise may, by resolution or resolutions of the board of
directors, be returned to the status of authorized but unissued Preferred
Stock of the same series. Unless otherwise provided in the resolution or
resolutions of the board of directors providing for the issue thereof, the
number of authorized shares of Preferred Stock of any such series may be
increased or decreased (but not below the number of shares thereof then
outstanding) by resolution or resolutions of the board of directors and the
filing of a certificate complying with the foregoing requirements. In case
the number of shares of any such series of Preferred Stock shall be
decreased, the shares representing such decrease shall, unless otherwise
provided in the resolution or resolutions of the board of directors
providing for the issuance thereof resume the status of authorized but
unissued Preferred Stock, undesignated as to series.

(3) The corporation may from time to time issue its shares of stock of any
class or series for such consideration as may be fixed from time to time by the
board of directors and may receive in payment thereof, in whole or in part,
cash, labor done, personal property or real property, whether tangible or
intangible, or interests therein or leases thereof. In the absence of actual
fraud in the transaction the judgment of the board of directors as to the value
of such labor, personal property, real property or interests therein or leases
thereof shall be conclusive. Any and all shares so issued for which the
consideration so fixed shall have been paid or delivered shall be deemed fully
paid stock and shall not be liable to any further call or assessment thereon,
and the holders of such shares shall not be liable for any further payment in
respect thereof.

(4) The authority of the board of directors to provide for the issuance of
shares of the Common Stock, and one or more series of the Preferred Stock,
shall include, but shall not be limited to, authority to issue shares of the
Common Stock and shares of any series of the Preferred Stock in any manner
(including issuance pursuant to rights, warrants or other options) and for any
purpose permitted by law, including for delivery as all or part of the
consideration for or in connection with the acquisition of all or part of the
stock of another corporation or of all or part of the assets of another
corporation or enterprise, irrespective of the amount by which the issuance of
such stock shall increase the number of shares outstanding (but not in excess
of the number of shares authorized).

(5) Except as may be provided otherwise in this Restated Certificate of
Incorporation, at all meetings of stockholders of the corporation, each holder
of record of Common Stock shall be entitled to one vote for each share of
Common Stock held. Holders of Preferred Stock shall have such voting rights, if
any, as are designated by the board of directors of the corporation in
accordance with Article 4(2) hereof.

(6) Subject to Article 4(2) hereof, dividends (payable in cash, shares or
otherwise) may be paid on the Common Stock in such amounts and at such times as
the board of directors of the corporation may determine in accordance with the
Delaware General Corporation Law.

Vote Required

Approval of the Amendment (Proposal 2 on the proxy card) requires the
affirmative vote of a majority of the outstanding shares of Common Stock.
Abstentions and broker non-votes, therefore, will have the same effect as a
vote against approval. The Board recommends a vote FOR the approval of the
amendment to its Restated Certificate of Incorporation.

RATIFICATION OF INDEPENDENT AUDITOR

Management of Superior has recommended that Ernst & Young LLP be retained as
Superior's independent auditors for both it and the Bank. The Board of
Directors approved retaining Ernst & Young LLP. Superior's former auditors have
issued no report that contained an adverse opinion, disclaimer of opinion,
modification or qualification for any of the financial statements of Superior
or the Bank. During the last three fiscal years there were no disagreements
between Superior and its former auditors on any matter of accounting principles
or practices, financial statement disclosure, or auditing scope or procedure.

Superior has selected the firm of Ernst & Young LLP to act as its and the
Bank's independent auditors for 2000. It is expected that representatives of
this firm will be present at the Annual Meeting and have an opportunity to make
a statement to, and to answer questions from, stockholders.

Ratification of the selection of Ernst & Young LLP (Proposal 3 on the proxy
card) requires the affirmative vote of a majority of the shares of Common Stock
present in person or represented by proxy at the Annual Meeting. The Board
recommends a vote for the ratification of Ernst & Young LLP.

BYLAW PROVISIONS REGARDING CONDUCT OF STOCKHOLDERS' MEETINGS

Superior's bylaws contain two provisions relating to the conduct of
stockholders' meetings. The first provision requires that certain procedures be
followed by a stockholder of record who wishes to present business at the
annual meeting of stockholders, including the nomination of candidates for
election as directors. In order to nominate persons for election as a director
or to present other business at a meeting, a stockholder must provide written
notice thereof to the secretary of Superior not less than 60 days nor more than
90 days prior to the first anniversary of the preceding year's annual meeting,
provided that, if the date of the annual

meeting is advanced by more than 30 days or delayed by more than 60 days from
such anniversary date, notice by the stockholder to be timely must be delivered
not earlier than the 90th day prior to such annual meeting or the 20th day
following the day on which public announcement of the date of such meeting is
first made.

As it relates to director nominations, the written notice must state all
information as to each nominee required to be disclosed in solicitations of
proxies for election of directors under SEC regulations, including the written
consent of each such nominee. As for any other business that the stockholder
proposes to bring before the meeting, the written notice must contain a brief
description of the business, the reasons for conducting the business at the
meeting and any material interest in such business of such stockholder. The
notice must also contain the name and address of such stockholder and the class
and number of shares of Superior owned beneficially and of record, as well as
the same information for each beneficial owner who may be nominated for
election as a director. The Board is not required to nominate a person
designated by a stockholder or to take up such other business as may be
contained in a written notice from a stockholder; however, compliance with this
procedure would permit a stockholder to nominate the individual at the
stockholders meeting, and any stockholder may vote shares in person or by proxy
for any individual such stockholder desires. The procedures relating to
nominating directors and presenting other business at a stockholders meeting
may only be used by a stockholder who is a stockholder of record at the time of
the giving of the notice by the stockholder to the secretary of Superior. The
procedures do not prohibit or apply to stockholder proposals under SEC rule
14a-8 as described at "Proposals of Stockholders."

The second provision of Superior's bylaws relates to the conduct of the
business at a stockholder meeting. Under that provision, the Board has the
authority to adopt rules for the conduct of meetings, and, unless inconsistent
with any such rules, the Chairman of the meeting may prescribe such rules,
regulations and procedures as, in his judgment, are appropriate for the proper
conduct of the meeting.

PROPOSALS OF STOCKHOLDERS

Subject to certain rules of the SEC, proposals by stockholders intended to
be presented at Superior's 2001 annual meeting of stockholders must be received
at Superior's principal executive offices not less than 120 calendar days in
advance of April 14, 2001 (December 14, 2000) for inclusion in the proxy or
information statement relating to the 2001 annual meeting.

OTHER MATTERS

Superior does not know of any matters to be presented for action at the
meeting other than those listed in the notice of the meeting and referred to
herein.

Superior has furnished without charge to its stockholders, herewith, a copy
of its annual report on Form 10-K, including Superior financial statements but
excluding financial statement schedules and exhibits, required to be filed with
the SEC for the year ended December 31, 1999. A copy of the financial statement
schedules and exhibits may be obtained upon written request to Rick D. Gardner,
16101 LaGrande Drive, Suite 103, Little Rock, Arkansas 72223.

PLEASE SIGN AND DATE THE ENCLOSED PROXY CARD, AND RETURN IT IN THE
ACCOMPANYING ENVELOPE AS PROMPTLY AS POSSIBLE.

YOU MAY REVOKE THE PROXY BY GIVING WRITTEN NOTICE OF REVOCATION TO THE
SECRETARY OF SUPERIOR AT ANY TIME PRIOR TO THE VOTING THEREOF, BY EXECUTING AND
SUBMITTING A LATER DATED PROXY, OR BY ATTENDING THE MEETING AND VOTING IN
PERSON.

SOLICITED BY THE BOARD OF DIRECTORS
PROXY
Common Stock
Superior Financial Corp.
Annual Meeting of Stockholders
May 17, 2000

The undersigned hereby appoints C. Stanley Bailey and C. Marvin Scott and
either of them, or such other persons as the Board of Directors of Superior
Financial Corp. ("Superior") may designate, proxies for the undersigned, with
full power of substitution, to represent the undersigned and to vote all of the
shares of common stock, par value $0.01, of Superior (the "Common Stock") which
the undersigned would be entitled to vote at the annual meeting of stockholders
to be held on May 17, 2000 and at any and all adjournments thereof. The
proxies, in their discretion, are further authorized to vote (i) for the
election of a person to the Board of Directors if any nominee named herein
becomes unable to serve or for good cause will not serve, and (ii) on any other
matter that may properly come before the meeting, including matters incident to
the conduct of the meeting.

1. Election of Directors:
NOMINEES FOR A TERM EXPIRING IN 2001: C. Stanley Bailey, Brian A. Gahr,
Howard B. McMahon, C. Marvin Scott, Ben F. Scroggin, John M. Stein, John E.
Steuri and David E. Stubblefield

[_] FOR all nominees listed except as [_] WITHHOLD AUTHORITY to vote for all nominees
marked to the contrary

INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL, STRIKE A LINE
THROUGH THE NOMINEE'S NAME IN THE ABOVE LIST.

2. For approval of an amendment to Superior's Restated and Amended Certificate
of Incorporation reducing the number of authorized shares of Preferred Stock
from 10,000,000 to 1,000,000 and making certain other formal revisions.

[_] FOR approval of the amendment [_] AGAINST approval of the amendment

3. Ratification of Ernst & Young LLP as Superior's independent auditors:

[_] FOR ratification [_] AGAINST ratification

(Continued On Reverse Side)

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND WILL BE VOTED
AS DIRECTED HEREIN. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR THE
PERSONS NAMED IN PROPOSAL 1, FOR APPROVAL OF THE AMENDMENT AND FOR RATIFICATION
OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS.

Please sign and date this proxy.

DATED: _______________________, 2000

Phone No.: _________________________

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(Signature of Stockholder)

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(Signature of Stockholder, if more
than one)

Please sign exactly as your name
appears on the envelope in which
this material was mailed. Agents,
executors, administrators,
guardians, and trustees must give
full title as such. Corporations
should signed by their President or
authorized officer.