Salem Community Bancorp, Inc.
401 West Main Street
Salem, Illinois 62281

January 20, 1995

Dear Shareholder:

We are pleased to invite you to attend the Special Meeting of
Shareholders (the "Special Meeting") of Salem Community Bancorp, Inc.
("Salem") on February 22, 1995. The Special Meeting will be held at
the offices of Community State Bank, 401 West Main Street, Salem,
Illinois 62881, commencing at 10:30 a.m. local time.

At the Special Meeting, Salem shareholders will be asked to approve
the merger of Salem with a subsidiary of Boatmen's Bancshares, Inc.
("Boatmen's"). The merger terms provide that upon consummation of the
merger each outstanding share of common stock of Salem will be converted
into 37.57 shares of common stock of Boatmen's, and cash in lieu of
fractional shares.

Your Board of Directors submits this proposed merger to you after
careful review and consideration. We believe that this proposed merger
will provide significant value to all shareholders, enabling holders of
Salem common stock to participate in the expanded opportunities for
growth that association with a larger, more geographically-diversified
super-regional financial organization makes possible and position Salem
and its shareholders to take advantage of future opportunities as the
banking industry continues to consolidate and restructure. Accordingly,
a majority of the Board has approved the merger as being in the best
interests of Salem and its shareholders and recommends that you vote in
favor of the merger at the Special Meeting.

Shareholders are urged to read carefully the accompanying Proxy
Statement/Prospectus which contains detailed information concerning the
matters to be acted upon at the Special Meeting.

Your participation in the meeting, in person or by proxy, is
important. Therefore, we ask that you please mark, sign and date the
enclosed proxy card and return it as soon as possible in the enclosed
postage-paid envelope. If you attend the Special Meeting, you may vote
in person if you wish, even if you have previously mailed in your proxy
card.

Sincerely,

/s/ Robert W. Montgomery

Robert W. Montgomery

2
SALEM COMMUNITY BANCORP, INC.
AN ILLINOIS CORPORATION

----------------------------

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD ON FEBRUARY 22, 1995

----------------------------

The Special Meeting of Shareholders (the "Special Meeting") of Salem
Community Bancorp, Inc. ("Salem") will be held on February 22, 1995, at
10:30 a.m., local time, at the offices of Community State Bank, 401
West Main Street, Salem, Illinois 62881, for the purpose of considering
and voting upon a proposal to approve and adopt the Agreement and Plan
of Merger dated September 1, 1994, as amended on September 28, 1994 and
December 2, 1994, attached as Appendix A to the accompanying Proxy
Statement/Prospectus, providing for the merger of Salem with and into
Boatmen's-Illinois, Inc., a Missouri corporation and wholly-owned
subsidiary of Boatmen's Bancshares, Inc.

Only the holders of common stock of Salem of record at the close of
business on January 18, 1995, are entitled to notice of and to vote
at the Special Meeting or at any adjournments or postponements thereof.

EACH SHAREHOLDER IS URGED TO COMPLETE AND RETURN PROMPTLY THE
ACCOMPANYING PROXY WHETHER OR NOT HE OR SHE PLANS TO ATTEND THE SPECIAL
MEETING. The prompt return of your signed proxy will help assure a
quorum and aid Salem in reducing the expense of additional proxy
solicitation. The giving of such proxy does not affect your right to
vote in person in the event you attend the Special Meeting.

By Order of the Board of Directors

/s/ Robert W. Montgomery

President

Salem, Illinois

January 20, 1995

SALEM SHAREHOLDERS SHOULD NOT SEND IN THEIR STOCK CERTIFICATES UNTIL
THEY RECEIVE THE LETTER OF TRANSMITTAL FORM AND INSTRUCTIONS FOR
SUBMITTING SUCH CERTIFICATES.

Filed Pursuant to Rule 424(b)(3)
Registration No. 33-57195

SALEM COMMUNITY BANCORP, INC.
PROXY STATEMENT
----------------------
BOATMEN'S BANCSHARES, INC.
PROSPECTUS

This Proxy Statement/Prospectus ("Proxy Statement/Prospectus") is
being furnished to the shareholders of Salem Community Bancorp, Inc., an
Illinois corporation ("SCB"), in connection with the solicitation of
proxies by the Board of Directors of SCB for use at the Special Meeting of
Shareholders of SCB to be held at 10:30 a.m., local time, on February 22,
1995, at the offices of Community State Bank, 401 West Main Street, Salem,
Illinois (the "Special Meeting").

At the Special Meeting, shareholders of SCB will consider and vote
upon the Agreement and Plan of Merger, dated September 1, 1994, as amended
on September 28, 1994 and December 2, 1994 (as amended, the "Merger
Agreement") among SCB, Boatmen's Bancshares, Inc., a Missouri corporation
("Boatmen's"), and Boatmen's-Illinois, Inc., a Missouri corporation and
wholly-owned subsidiary of Boatmen's ("Boatmen's-Illinois"), which provides
for, among other things, the proposed merger of SCB with and into
Boatmen's-Illinois (the "Merger"). Upon consummation of the Merger, each
issued and outstanding share of common stock of SCB (other than shares held
by any shareholder properly exercising dissenters' rights) would be
converted into the right to receive 37.57 shares of common stock, par value
$1.00 per share, of Boatmen's and any attached rights ("Boatmen's Common"),
plus cash in lieu of any fractional share interests.

This Proxy Statement/Prospectus also constitutes a prospectus of
Boatmen's with respect to up to 288,700 shares of Boatmen's Common issuable
in the Merger to holders of common stock of SCB. The outstanding shares
of Boatmen's Common are, and the shares of Boatmen's Common to be issued
in the Merger will be, included for quotation on the Nasdaq Stock Market's
National Market ("Nasdaq"). The last reported sale price of Boatmen's
Common on Nasdaq on January 19, 1995, was $28.4375.

This Proxy Statement/Prospectus and the accompanying form of proxy are
first being mailed to shareholders of SCB on or about January 20, 1995 (the
"Mailing Date").

The Proxy Statement/Prospectus does not cover any resales of the
Boatmen's Common offered hereby to be received by the stockholders deemed
to be "affiliates" of Boatmen's or SCB upon consummation of the Merger.
No person is authorized to make use of this Proxy Statement/Prospectus in
connection with such resales.

THE SHARES OF BOATMEN'S COMMON ISSUABLE IN THE MERGER
HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROXY STATEMENT/PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-----------------------------------

THE SHARES OF BOATMEN'S COMMON OFFERED HEREBY ARE NOT
SAVINGS ACCOUNTS, DEPOSITS OR OTHER OBLIGATIONS OF ANY
BANK OR SAVINGS ASSOCIATION AND ARE NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION, THE BANK INSURANCE
FUND OR ANY OTHER GOVERNMENTAL AGENCY.
-----------------------------------

THE DATE OF THIS PROXY STATEMENT/PROSPECTUS IS JANUARY 19, 1995

TABLE OF CONTENTS
-----------------

PAGE
----

AVAILABLE INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . 1

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE. . . . . . . . . . . . . 1

SUMMARY INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Special Meeting . . . . . . . . . . . . . . . . . . . . . . . . 4
Date, Time and Place of the Special Meeting . . . . . . . . . . 4
Matters to be Considered at the Special Meeting . . . . . . . . 4
Record Date for the Special Meeting . . . . . . . . . . . . . . 4
Vote Required to Approve Merger Agreement . . . . . . . . . . . 4
Certain Holders of SCB Common . . . . . . . . . . . . . . . . . 5
Revocation of Proxies . . . . . . . . . . . . . . . . . . . . . 5
The Merger. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Merger Consideration. . . . . . . . . . . . . . . . . . . . . . 5
Value of the Merger . . . . . . . . . . . . . . . . . . . . . . 5
Reasons for the Merger and Recommendation of the Boards of
Directors. . . . . . . . . . . . . . . . . . . . . . . . . 5
Conditions to the Merger; Regulatory Approvals. . . . . . . . . 6
Conduct of Business Pending the Merger; Dividends . . . . . . . 6
Termination of the Merger Agreement . . . . . . . . . . . . . . 6
Payment Upon Occurrence of Certain Triggering Events. . . . . . 7
Federal Income Tax Consequences . . . . . . . . . . . . . . . . 7
Accounting Treatment. . . . . . . . . . . . . . . . . . . . . . 8
Effective Time of the Merger. . . . . . . . . . . . . . . . . . 8
Interests of Certain Persons in the Merger. . . . . . . . . . . 8
Dissenters' Rights. . . . . . . . . . . . . . . . . . . . . . . 8
Management and Operations After the Merger. . . . . . . . . . . . . 9
Comparison of Shareholder Rights. . . . . . . . . . . . . . . . . . 9
Stock Purchase Agreement. . . . . . . . . . . . . . . . . . . . . . 9
Subsidiary Bank Merger. . . . . . . . . . . . . . . . . . . . . . . 9

COMPARATIVE STOCK PRICES . . . . . . . . . . . . . . . . . . . . . . . . 11

SELECTED COMPARATIVE PER SHARE DATA. . . . . . . . . . . . . . . . . . . 12

SELECTED FINANCIAL DATA. . . . . . . . . . . . . . . . . . . . . . . . . 13

THE SPECIAL MEETING. . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Date, Time and Place of Special Meeting . . . . . . . . . . . . . . 16
Matters to be Considered at the Special Meeting . . . . . . . . . . 16
Record Date for Special Meeting . . . . . . . . . . . . . . . . . . 16

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PAGE
----

Vote Required to Approve the Merger Agreement . . . . . . . . . . . 16
Voting and Revocation of Proxies for Special Meeting. . . . . . . . 17
Solicitation of Proxies for the Special Meeting . . . . . . . . . . 17
Expenses for Preparation of Proxy Statement/Prospectus. . . . . . . 17
Mailing Date of Proxy Statement/Prospectus. . . . . . . . . . . . . 17

THE PARTIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Boatmen's . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Pending Acquisitions. . . . . . . . . . . . . . . . . . . . . . 18
Boatmen's-Illinois. . . . . . . . . . . . . . . . . . . . . . . . . 20
SCB . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

THE MERGER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Background of and Reasons for the Merger. . . . . . . . . . . . . . 20
Recommendation of the Boards of Directors . . . . . . . . . . . . . 21
Merger Consideration. . . . . . . . . . . . . . . . . . . . . . . . 21
Form of the Merger. . . . . . . . . . . . . . . . . . . . . . . . . 22
Conduct of Business Pending the Merger; Dividends . . . . . . . . . 22
Conditions to Consummation of the Merger. . . . . . . . . . . . . . 22
Regulatory Approvals. . . . . . . . . . . . . . . . . . . . . . . . 23
Termination or Abandonment. . . . . . . . . . . . . . . . . . . . . 23
Payment Upon Occurrence of Certain Triggering Events. . . . . . . . 23
Dissenters' Rights. . . . . . . . . . . . . . . . . . . . . . . . . 24
Exchange of SCB Stock Certificates; Fractional Shares . . . . . . . 26
Representations and Warranties of SCB, Boatmen's and Boatmen's-
Illinois. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Certain Other Agreements. . . . . . . . . . . . . . . . . . . . . . 27
No Solicitation . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Waiver and Amendment. . . . . . . . . . . . . . . . . . . . . . . . 30
Expenses and Fees . . . . . . . . . . . . . . . . . . . . . . . . . 30
Federal Income Tax Consequences . . . . . . . . . . . . . . . . . . 31
Resale of Boatmen's Common. . . . . . . . . . . . . . . . . . . . . 31
Interests of Certain Persons in the Merger. . . . . . . . . . . . . 32
Effective Time. . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Accounting Treatment. . . . . . . . . . . . . . . . . . . . . . . . 33
Management and Operations After the Merger. . . . . . . . . . . . . 33
Effect on Employee Benefit Plans. . . . . . . . . . . . . . . . . . 33

PRO FORMA FINANCIAL DATA . . . . . . . . . . . . . . . . . . . . . . . . 34

DESCRIPTION OF BOATMEN'S CAPITAL STOCK . . . . . . . . . . . . . . . . . 42
Boatmen's Common. . . . . . . . . . . . . . . . . . . . . . . . . . 42
Boatmen's Series B Preferred Stock. . . . . . . . . . . . . . . . . 43

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PAGE
----

COMPARISON OF SHAREHOLDER RIGHTS . . . . . . . . . . . . . . . . . . . . 43
Shareholder Vote Required for Certain Transactions. . . . . . . . . 44
Voting Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Special Meetings of Shareholders; Shareholder Action by Written
Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Notice of Shareholder Nominations of Directors. . . . . . . . . . . 47
Shareholder Proposal Procedures . . . . . . . . . . . . . . . . . . 47
Shareholder Rights Plan . . . . . . . . . . . . . . . . . . . . . . 47
Dissenters' Rights. . . . . . . . . . . . . . . . . . . . . . . . . 50
Takeover Statutes . . . . . . . . . . . . . . . . . . . . . . . . . 50
Liability of Directors; Indemnification . . . . . . . . . . . . . . 52
Limitation of Liability of Directors. . . . . . . . . . . . . . . . 53
Consideration of Non-Shareholder Interests. . . . . . . . . . . . . 53

INFORMATION ABOUT SCB. . . . . . . . . . . . . . . . . . . . . . . . . . 54
Business of SCB and Community Bank. . . . . . . . . . . . . . . . . 54
Statistical Information About SCB . . . . . . . . . . . . . . . . . 54
Distribution of Average Assets, Liabilities and
Stockholders' Equity, and Interest Rates . . . . . . . . . 54
Interest Differential . . . . . . . . . . . . . . . . . . . . . 57
Investment Portfolio. . . . . . . . . . . . . . . . . . . . . . 58
Loan Portfolio. . . . . . . . . . . . . . . . . . . . . . . . . 59
Other Interest-Bearing Assets . . . . . . . . . . . . . . . . . 61
Summary of Loan Loss Experience . . . . . . . . . . . . . . . . . . 62
Management's Discussion and Analysis of Financial Condition
and Results of Operations of SCB and Community Bank. . . . . 65
Security Ownership of Certain Beneficial Owners and Management of
SCB . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74

LEGAL OPINION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75

EXPERTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Independent Auditors for Boatmen's. . . . . . . . . . . . . . . . . 75
Independent Auditors for SCB. . . . . . . . . . . . . . . . . . . . 76
Presence at Special Meeting . . . . . . . . . . . . . . . . . . . . 76

SHAREHOLDER PROPOSALS. . . . . . . . . . . . . . . . . . . . . . . . . . 76

INDEX TO FINANCIAL STATEMENTS OF SCB . . . . . . . . . . . . . . . . . .F-1

APPENDICES

Merger Agreement. . . . . . . . . . . . . . . . . . . . . . . . . .A-1
Excerpts of The Illinois Business Corporation Act (Dissenters'
Rights) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B-1

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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS PROXY STATEMENT/PROSPECTUS IN
CONNECTION WITH THE OFFERING DESCRIBED HEREIN AND ANY SUCH INFORMATION OR
REPRESENTATION, IF GIVEN OR MADE, MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY BOATMEN'S OR SCB. THIS PROXY STATEMENT/PROSPECTUS DOES NOT
CONSTITUTE A SOLICITATION OR AN OFFERING OF ANY SECURITIES OTHER THAN THE
REGISTERED SECURITIES TO WHICH IT RELATES OR IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT WOULD BE UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN
SUCH JURISDICTION. THE DELIVERY OF THIS PROXY STATEMENT/PROSPECTUS AT ANY
TIME DOES NOT IMPLY THAT ANY INFORMATION HEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO ITS DATE.

AVAILABLE INFORMATION

Boatmen's is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information
with the Securities and Exchange Commission (the "S.E.C."). The reports,
proxy statements and other information can be inspected and copied at the
public reference facilities of the S.E.C., Room 1024, 450 Fifth Street,
N.W., Washington, D.C. 20549, and at the regional offices of the S.E.C.
located at Seven World Trade Center, New York, New York 10048, and Suite
1400, Citicorp Center, 500 West Madison Street, Chicago, Illinois 60661,
and copies of such materials can be obtained from the public reference
section of the S.E.C. at 450 Fifth Street, N.W., Washington, D.C. 20549,
at prescribed rates. In addition, reports, proxy statements and other
information concerning Boatmen's may be inspected at the offices of the
National Association of Securities Dealers, Inc., 1735 K Street, N.W.,
Washington, D.C. 20006.

Boatmen's has filed with the S.E.C. a Registration Statement on
Form S-4 (together with any amendments thereto, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities
Act"), with respect to the shares of Boatmen's Common to be issued pursuant
to the Merger described herein. This Proxy Statement/Prospectus does not
contain all the information set forth in the Registration Statement and the
exhibits thereto. Such additional information may be obtained from the
S.E.C.'s principal office in Washington, D.C. Statements contained in this
Proxy Statement/Prospectus or in any document incorporated in this Proxy
Statement/Prospectus by reference as to the contents of any contract or
other document referred to herein or therein are not necessarily complete,
and in each instance where reference is made to the copy of such contract
or other document filed as an exhibit to the Registration Statement or such
other document, each such statement is qualified in all respects by such
reference.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents filed with the S.E.C. by Boatmen's (File
No. 1-3750) and Worthen Banking Corporation ("Worthen") (File No. 1-8525)
(See "THE PARTIES -- Boatmen's -- Pending Acquisitions) pursuant to the
Exchange Act are incorporated by reference in this Proxy Statement/
Prospectus:

1. Boatmen's Annual Report on Form 10-K for the year ended
December 31, 1993;

2. Boatmen's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1994, June 30, 1994 and September 30, 1994;

1
8

3. The description of the common stock of Boatmen's contained in
Boatmen's Registration Statement on Form 8-A under the Exchange
Act, as amended under cover of Form 8 dated July 15, 1988, and
the description of the preferred share purchase rights contained
in Boatmen's Registration Statement on Form 8-A under the
Exchange Act, filed August 14, 1990;

4. Boatmen's Current Report on Form 8-K dated September 2, 1994.

5. Worthen's Annual Report on Form 10-K for the year ended
December 31, 1993;

6. Worthen's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1994, June 30, 1994 and September 30, 1994; and

7. Worthen's Current Reports on Form 8-K dated June 24, 1994 and
September 9, 1994.

All documents and reports filed by Boatmen's and Worthen pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of
this Proxy Statement/Prospectus and prior to the date of the special
meeting of shareholders of SCB shall be deemed to be incorporated by
reference in this Proxy Statement/Prospectus and to be a part hereof from
the dates of filing of such documents or reports. Any statement contained
in a document incorporated or deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Proxy
Statement/Prospectus to the extent that a statement contained herein or in
any other subsequently filed document which also is deemed to be
incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Proxy Statement/
Prospectus.

THIS PROXY STATEMENT/PROSPECTUS INCORPORATES DOCUMENTS RELATING TO
BOATMEN'S AND WORTHEN BY REFERENCE WHICH ARE NOT PRESENTED HEREIN OR
DELIVERED HEREWITH. THESE DOCUMENTS (EXCLUDING UNINCORPORATED EXHIBITS)
ARE AVAILABLE, WITHOUT CHARGE, TO ANY PERSON, INCLUDING ANY BENEFICIAL
OWNER, TO WHOM THIS PROXY STATEMENT/PROSPECTUS IS DELIVERED, UPON WRITTEN
OR ORAL REQUEST TO KEVIN R. STITT, DIRECTOR OF INVESTOR RELATIONS,
BOATMEN'S BANCSHARES, INC., ONE BOATMEN'S PLAZA, 800 MARKET STREET,
ST. LOUIS, MISSOURI 63101 (TELEPHONE NUMBER (314) 466-7662). IN ORDER TO
ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD BE MADE BY
FEBRUARY 14, 1995.

2
9

SUMMARY INFORMATION

The following is a brief summary of certain information contained
elsewhere in this Proxy Statement/Prospectus. The following summary is not
intended to be complete and is qualified in all respects by the information
appearing elsewhere herein or incorporated by reference into this Proxy
Statement/Prospectus, the Exhibits hereto and the documents referred to
herein. All information contained in this Proxy Statement/Prospectus
relating to Boatmen's and its subsidiaries has been supplied by Boatmen's
and all information relating to SCB and its subsidiary has been supplied
by SCB. Shareholders are urged to read this Proxy Statement/Prospectus and
the Appendices hereto in their entirety.

INTRODUCTION

This Proxy Statement/Prospectus relates to an Agreement and Plan of
Merger dated September 1, 1994, as amended on September 28, 1994 and
December 2, 1994 (as amended, the "Merger Agreement"), among Salem
Community Bancorp, Inc., an Illinois corporation ("SCB"), Boatmen's
Bancshares, Inc., a Missouri corporation ("Boatmen's"), and Boatmen's-
Illinois, Inc., a Missouri corporation and wholly-owned subsidiary of
Boatmen's ("Boatmen's-Illinois"), which provides for, among other things,
the merger of SCB with and into Boatmen's-Illinois (the "Merger"). As a
result of the Merger, Boatmen's will retain beneficial ownership of all of
the issued and outstanding capital stock of Boatmen's-Illinois, and the
separate corporate existence of SCB would cease.

In connection with the Merger, Boatmen's has caused Boatmen's Bank of
South Central Illinois, an Illinois state-chartered bank and wholly-owned
subsidiary of Boatmen's ("Boatmen's-South Central") and SCB has caused
Community State Bank, Salem, Illinois, an Illinois state-chartered bank and
96.37 percent owned subsidiary of SCB ("Community Bank"), to enter into an
Agreement to Merge, dated September 1, 1994, as amended on September 28,
1994 and December 2, 1994 (as amended, the "Subsidiary Merger Agreement"),
which provides for, among other things, the merger of Community Bank with
and into Boatmen's-South Central ("the "Subsidiary Bank Merger"). As a
result of the Subsidiary Bank Merger, Boatmen's will retain beneficial
ownership of all of the issued and outstanding capital stock of Boatmen's-
South Central, and the separate existence of Community Bank would cease.
A description of the Subsidiary Bank Merger is set forth herein. See
"SUMMARY INFORMATION--Subsidiary Bank Merger." It is anticipated that the
Subsidiary Bank Merger and the Merger would be consummated
contemporaneously.

The summary set forth in this Proxy Statement/Prospectus of certain
provisions of the Merger Agreement is qualified in its entirety by
reference to the full text of the Merger Agreement, which is incorporated
by reference herein and attached as Appendix A to this Proxy Statement/
Prospectus.

THE PARTIES

BOATMEN'S

Boatmen's is a multi-bank holding company headquartered in St. Louis,
Missouri. At September 30, 1994, Boatmen's had consolidated assets of
approximately $28.3 billion and shareholders' equity of approximately
$2.2 billion, making it the largest bank holding company in Missouri and
among the 30 largest in the United States. Boatmen's 45 subsidiary banks,
including a federal savings bank, operate from over 400 locations in
Missouri, Arkansas, Illinois, Iowa, Kansas, New Mexico, Oklahoma, Tennessee
and Texas. Boatmen's also ranks among the 16 largest providers of trust
services in the nation, with approximately $35.5 billion in assets under
management at September 30, 1994. Boatmen's other principal businesses
include a mortgage banking company, a credit life insurance company, a
credit card company

3
10

and an insurance agency. For information regarding the impact of the
increasing interest rate environment on Boatmen's off-balance sheet
financial instruments, see "PRO FORMA FINANCIAL DATA." The principal
executive offices of Boatmen's are at One Boatmen's Plaza, 800 Market
Street, St. Louis, Missouri 63101 (telephone number (314) 466-6000).

BOATMEN'S-ILLINOIS

Boatmen's-Illinois was organized as a wholly-owned subsidiary of
Boatmen's solely to effectuate the Merger and has not engaged in any
significant business activity. Immediately prior to consummation of the
Merger and the Subsidiary Bank Merger, Boatmen's would contribute all of
the capital stock of Boatmen's-South Central to Boatmen's-Illinois.

SCB

SCB is a one-bank holding company headquartered in Salem, Illinois.
The business of SCB consists primarily of the ownership, supervision and
control of Community Bank. At September 30, 1994, SCB had consolidated
assets of approximately $79.2 million and shareholders' equity of
approximately $4.5 million. At the date of this Proxy
Statement/Prospectus, all of the common stock of SCB was held by 8 persons,
each of whom is a director of SCB. The principal executive offices of SCB
and Community Bank are at 401 West Main, Salem, Illinois 62881 (telephone
number (618) 548-2265).

THE SPECIAL MEETING

DATE, TIME AND PLACE OF THE SPECIAL MEETING

The Special Meeting of Shareholders of SCB (the "Special Meeting")
will be held at the offices of Community Bank, 401 West Main Street, Salem,
Illinois 62881 on February 22, 1995, at 10:30 a.m., local time.

MATTERS TO BE CONSIDERED AT THE SPECIAL MEETING

At the Special Meeting, holders of common stock, par value $1.00 per
share, of SCB ("SCB Common") will consider and vote upon the approval of
the Merger Agreement providing for, among other things, the Merger of SCB
with and into Boatmen's-Illinois. In addition, the holders of SCB Common
may be asked to vote on a proposal to adjourn or postpone the Special
Meeting which adjournment or postponement could be used for the purpose,
among others, of allowing time for the solicitation of additional votes to
approve the Merger Agreement.

RECORD DATE FOR THE SPECIAL MEETING

The record date for the Special Meeting is January 18, 1995.

VOTE REQUIRED TO APPROVE MERGER AGREEMENT

Approval of the Merger Agreement will require the affirmative vote of
two-thirds (2/3) of the outstanding shares of SCB Common entitled to vote
thereon. Holders of SCB Common will be entitled to one vote per share.

4
11

CERTAIN HOLDERS OF SCB COMMON

As of September 30, 1994, the 8 executive officers and directors of
SCB and their affiliates owned beneficially all 7,684 shares (100%) of SCB
Common, all of which are expected to be voted by such persons in favor of
the Merger Agreement. See "INFORMATION ABOUT SCB -- Security Ownership of
Certain Beneficial Owners and Management of SCB."

REVOCATION OF PROXIES

Proxies for use at the Special Meeting accompany this Proxy
Statement/Prospectus. Any proxy given pursuant to this solicitation may
be revoked by the grantor at any time prior to the voting thereof on the
Merger Agreement by filing with the Secretary of SCB a written revocation
or a duly executed proxy bearing a later date. A holder of SCB Common may
withdraw his or her proxy at the Special Meeting at any time before it is
exercised by electing to vote in person; however, attendance at the Special
Meeting will not in and of itself constitute a revocation of the proxy.

THE MERGER

MERGER CONSIDERATION

At the time the Merger is consummated (the "Effective Time"), SCB will
merge into Boatmen's-Illinois and, as a result thereof, each share of SCB
Common, other than shares any holders of which have duly exercised and
perfected their dissenters' rights under the Illinois Business Corporation
Act of 1983 (the "Illinois Law"), will be converted into 37.57 shares of
common stock, par value $1.00 per share, of Boatmen's, together with any
rights attached thereto ("Boatmen's Common"), under or by virtue of the
Rights Agreement, dated August 14, 1990, between Boatmen's and Boatmen's
Trust Company, as Rights Agent (such number of shares of Boatmen's Common,
together with any cash payment in lieu of fractional shares, as described
herein, is referred to herein as the "Merger Consideration"). For a
description of the Rights Agreement, see "COMPARISON OF SHAREHOLDER RIGHTS
- -- Shareholder Rights Plan." No fractional shares of Boatmen's Common will
be issued and, in lieu thereof, holders of shares of SCB Common who would
otherwise be entitled to a fractional share interest (after taking into
account all shares of SCB Common held by such holder) will be paid an
amount in cash equal to the product of such fractional share interest and
the closing price of a share of Boatmen's Common on the Nasdaq Stock
Market's National Market ("Nasdaq") on the business day immediately
preceding the date on which the Effective Time occurs.

VALUE OF THE MERGER

Based on the Merger Consideration and the closing sales price of
Boatmen's Common as reported on Nasdaq on January 19, 1995, the Merger
had a per share value of $1,068.40 to holders of SCB Common, and the
approximate total value of the Merger Consideration to SCB shareholders,
was $8.21 million. The market value of the Merger Consideration as
stated above may increase or decrease depending on the closing sale price
of Boatmen's Common as reported on Nasdaq on the date on which the
Effective Time occurs. No assurance can be given as to the market price
of Boatmen's Common on the date on which the Effective Time occurs.

REASONS FOR THE MERGER AND RECOMMENDATION OF THE BOARDS OF DIRECTORS

The Board of Directors of SCB has determined that the Merger and the
Merger Agreement, including the Merger Consideration, are fair to, and in
the best interests of, SCB, Community Bank and their shareholders. The
Board believes that a business combination with a larger and more
geographically

5
12

diversified regional bank holding company would, in addition to providing
significant shareholder value to all shareholders, enable Community Bank to
compete more effectively in its market area and participate in the expanded
opportunities for growth that the Merger and the Subsidiary Bank Merger will
make possible. Accordingly, the Board recommends that shareholders of SCB
vote for approval and adoption of the Merger Agreement.

Certain members of the management and Board of Directors of SCB have
interests in the Merger that are in addition to the interests of
shareholders of SCB generally. See "THE MERGER -- Interests of Certain
Persons in the Merger."

The Board of Directors of Boatmen's believes that the acquisition of
SCB and the merger of its banking subsidiary, Community Bank, into
Boatmen's-South Central, would be a natural and desirable addition to
Boatmen's banking franchise in Southern Illinois.

CONDITIONS TO THE MERGER; REGULATORY APPROVALS

The Merger is subject to various conditions including, among other
things, (i) approval of the Merger Agreement by the requisite two-thirds
(2/3) vote of the shareholders of SCB; (ii) receipt of regulatory approval
from the Board of Governors of the Federal Reserve System (the "Federal
Reserve"); (iii) receipt of an opinion of counsel on certain tax aspects
of the Merger; and (iv) the occurrence of no material adverse changes in
the businesses of Boatmen's or SCB. The Merger may not be consummated
until the 30th day after the date of Federal Reserve approval; provided,
however, that the Merger may be consummated after the 15th day following
the date of Federal Reserve approval if the Federal Reserve has not
received any adverse comments from the United States Attorney General
relating to the competitive aspects of the transaction and the Attorney
General has consented to such shorter waiting period. An application for
the required regulatory approval of the Merger from the Federal Reserve has
been filed and is pending.

CONDUCT OF BUSINESS PENDING THE MERGER; DIVIDENDS

Pursuant to the Merger Agreement, SCB has agreed to carry on its
business in the usual, regular and ordinary course in substantially the
same manner as conducted prior to the execution of the Merger Agreement.
The Merger Agreement provides that SCB may not declare or pay any dividend
or make any other distribution to shareholders, whether in cash, stock or
other property, after the date of the Merger Agreement, and that Community
Bank may declare and pay dividends in the minimum amount necessary to
enable SCB to meet its existing debt amortization obligations.

TERMINATION OF THE MERGER AGREEMENT

6
13

regulatory application filed in connection with the Merger or the Subsidiary
Bank Merger be finally denied or disapproved by the respective regulatory
authority; and (viii) by either party if the Merger is not approved by the
shareholders of SCB.

PAYMENT UPON OCCURRENCE OF CERTAIN TRIGGERING EVENTS

The Merger Agreement provides that upon the occurrence of one or more
Triggering Events (as described below), SCB will pay to Boatmen's the sum
of Five Hundred Thousand Dollars ($500,000).

As used in the Merger Agreement, the term "Triggering Event" means any
of the following events: (i) termination of the Merger Agreement by
Boatmen's upon a breach thereof by SCB, provided that within twelve months
of the date of such termination, an event described in clause (ii) or (iii)
of this sentence shall have occurred; (ii) any person or group of persons
(other than Boatmen's) acquires, or has the right to acquire, fifty percent
(50%) or more of the outstanding shares of SCB Common; (iii) upon the entry
by SCB or Community Bank into an agreement or other understanding with a
person or group of persons (other than Boatmen's and/or its affiliates) for
such person or group of persons to acquire, merge or consolidate with SCB
or Community Bank or to purchase all or substantially all of SCB's or
Community Bank's assets; (iv) the failure of SCB's shareholders to approve
the Merger and the Merger Agreement at the Special Meeting; provided,
however, that the failure of SCB's shareholders to approve the Merger and
the Merger Agreement shall not be deemed a Triggering Event if (a) the
average of the daily closing prices of a share of Boatmen's Common, as
reported on Nasdaq during the period of twenty (20) trading days ending at
the end of the second trading day immediately preceding the Mailing Date
(the "Boatmen's Final Price"), is less than $26.00, and (b) the number
obtained by dividing the Boatmen's Final Price by the Boatmen's Initial
Price (as defined below), is less than the number obtained by dividing the
Final Index Price (as defined below) by the Initial Index Price (as defined
below) and subtracting .20 from such quotient.

As used above, (a) "Index Group" means all of the bank holding
companies listed on Exhibit 7.09 to the Merger Agreement, the common stock
of which is publicly traded and as to which there is no pending publicly
announced proposal at any time during the period of twenty (20) trading
days ending at the end of the fifth trading day immediately preceding the
closing date of the Merger for such company to be acquired or to acquire
another company (which would constitute a "significant subsidiary" of such
company as such term is defined under applicable S.E.C. regulations) in
exchange for its stock; (b) "Boatmen's Initial Price" means the closing
price of a share of Boatmen's Common on September 1, 1994 ($33.6250);
(c) "Initial Index Price" means the weighted average (weighted in
accordance with the factors specified on Exhibit 7.09 to the Merger
Agreement) of the per share closing prices of the common stock of the bank
holding companies comprising the Index Group, as reported on the
consolidated transactions reporting system for the market or exchange on
which such common stock is principally traded, on September 1, 1994;
(d) "Final Price" of any company belonging to the Index Group means the
average of the daily closing sale prices of a share of common stock of such
company, as reported in the consolidated transaction reporting system for
the market or exchange on which such common stock is principally traded,
during the period of twenty (20) trading days ending at the end of the
second trading day immediately preceding the Mailing Date; and (e) "Final
Index Price" means the weighted average (weighted in accordance with the
factors specified on Exhibit 7.09 to the Merger Agreement) of the Final
Prices for all of the companies comprising the Index Group.

FEDERAL INCOME TAX CONSEQUENCES

The Merger is intended to qualify as a tax-free reorganization so that
no gain or loss would be recognized by Boatmen's or SCB, and no gain or
loss would be recognized by SCB shareholders, except in respect of cash
received for fractional shares and except for any cash payments which might
be received by such shareholders properly exercising their dissenters'
rights. Consummation of the Merger is

7
14

conditioned upon receipt by Boatmen's of an opinion of Lewis, Rice & Fingersh,
L.C., counsel to Boatmen's, that (i) the Merger will constitute a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code of 1986, as amended, (ii) no gain or loss will be recognized by the
shareholders of SCB who receive solely shares of Boatmen's Common, (iii) the
basis of shares of Boatmen's Common received by the shareholders of SCB will
be the same as the basis of shares of SCB Common exchanged therefor, and (iv)
the holding period of the shares of Boatmen's Common received by such
shareholders will include the holding period of the shares of SCB Common
exchanged therefor.

THE FOREGOING IS A GENERAL SUMMARY OF ALL OF THE MATERIAL FEDERAL
INCOME TAX CONSEQUENCES OF THE MERGER TO SCB SHAREHOLDERS, WITHOUT REGARD
TO THE PARTICULAR FACTS AND CIRCUMSTANCES OF EACH SHAREHOLDER'S TAX
SITUATION AND STATUS. EACH SCB SHAREHOLDER SHOULD CONSULT HIS OR HER OWN
TAX ADVISOR REGARDING ANY SUCH SPECIFIC TAX SITUATION AND STATUS, INCLUDING
THE APPLICATION AND EFFECT OF FEDERAL, STATE, LOCAL AND FOREIGN LAWS AND
THE POSSIBLE EFFECT OF CHANGES IN FEDERAL AND OTHER TAX LAWS.

ACCOUNTING TREATMENT

The Merger will be accounted for by Boatmen's under the purchase
method of accounting in accordance with Accounting Principles Board Opinion
No. 16, "Business Combinations," as amended ("APB No. 16"). Under this
method of accounting, the purchase price will be allocated to assets
acquired and liabilities assumed based on their estimated fair values at
the Effective Time. Income of the combined company will not include income
(or loss) of SCB prior to the Effective Time.

EFFECTIVE TIME OF THE MERGER

The Merger Agreement provides that the Merger will become effective
upon the filing of a Certificate of Merger with the Secretary of State of
the State of Missouri. It is presently anticipated that the Merger and the
Subsidiary Bank Merger will be consummated contemporaneously during the
first quarter of 1995, but no assurance can be given that such timetable
will be met.

INTERESTS OF CERTAIN PERSONS IN THE MERGER

Certain members of the management and Board of Directors of SCB have
interests in the Merger that are in addition to the interests of
shareholders of SCB generally. For example, Mr. Robert W. Montgomery,
President and Chief Executive Officer of SCB and Community Bank, has
entered into a Consulting Agreement with Boatmen's pursuant to which
Mr. Montgomery has agreed to serve as a director and consultant to
Boatmen's-South Central upon completion of the Merger and the Subsidiary
Bank Merger.

For information about the percentage of SCB Common owned by the
directors and executive officers of SCB, see "INFORMATION ABOUT SCB --
Security Ownership of Certain Beneficial Owners and Management of SCB."
None of the directors or executive officers of SCB would own, on a pro
forma basis giving effect to the Merger, more than 1% of the issued and
outstanding shares of Boatmen's Common.

DISSENTERS' RIGHTS

The rights of dissenting shareholders of SCB are governed by the
Illinois Law, which provides that a shareholder will be entitled to receive
the fair value of his or her shares of SCB Common held immediately before
the Merger is consummated if such shareholder (i) delivers to SCB, prior
to the Special Meeting, a written demand for payment of his or her shares
if the Merger is consummated, and (ii) does not vote his or her shares in
favor of approving the Merger Agreement.

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15

MANAGEMENT AND OPERATIONS AFTER THE MERGER

It is anticipated that, as of the Effective Time of the Merger or
thereafter, the Subsidiary Bank Merger will be consummated. Boatmen's-
South Central will be the surviving bank in the Subsidiary Bank Merger.
Upon consummation of the Subsidiary Bank Merger, the present offices of
Community Bank will operate as branch offices of Boatmen's-South Central.
It is not anticipated that the management or Board of Directors of
Boatmen's, Boatmen's-Illinois or Boatmen's-South Central will be affected
as a result of the Merger or the Subsidiary Bank Merger, except that
Mr. Montgomery will become a director of Boatmen's-South Central.

COMPARISON OF SHAREHOLDER RIGHTS

The rights of the shareholders of SCB Common and Boatmen's Common
differ in certain respects. The rights of the shareholders of SCB who
receive shares of Boatmen's Common in the Merger will be governed by the
corporate law of Missouri, the state in which Boatmen's is incorporated,
and by Boatmen's Articles of Incorporation, Bylaws and other corporate
documents. The governing law and documents of Boatmen's differ from those
which apply to SCB, which is an Illinois corporation, in several respects,
including relative rights in connection with certain redeemable preferred
stock of Boatmen's presently issued and outstanding; the shareholder votes
required for certain business combinations; removal of directors and
amendments to the Articles of Incorporation; certain rights pursuant to
Boatmen's shareholder rights plan; the circumstances under which a
shareholder may dissent from corporate action and receive fair value for
his or her shares; and rights of Boatmen's and its shareholders pursuant
to certain corporate takeover statutes.

STOCK PURCHASE AGREEMENT

SCB and its shareholders entered into a Stock Purchase Agreement,
dated July 11, 1985 (the "Stock Purchase Agreement"), subjecting the shares
of SCB held by the shareholders to certain transfer restrictions.
Generally, the Stock Purchase Agreement provides that prior to a
shareholder selling his shares pursuant to a bona fide offer, that
shareholder must first offer to sell his shares, first to SCB and then to
the other shareholders, at a price determined by a formula contained in the
Stock Purchase Agreement. Similarly, upon the death of a shareholder, it
is deemed that the decedent has offered for sale his shares to SCB and the
other shareholders, at the stated formula price. The formula for
determining price, both upon sale to a third party and upon death, is book
value of such shares as of the most recent year-end, adjusted by an amount
determined by formula to approximate the increase or decrease in book value
to the most recent month-end prior to transfer of the shares. On
August 31, 1994, SCB and all its shareholders amended the Stock Purchase
Agreement to provide that all rights thereunder are waived with respect to
the transactions contemplated in the Merger Agreement.

SUBSIDIARY BANK MERGER

In connection with the Merger, Boatmen's has caused Boatmen's-South
Central and SCB has caused Community Bank to enter into the Subsidiary
Merger Agreement which provides for the Subsidiary Bank Merger. Pursuant
to the terms of the Subsidiary Merger Agreement, at the effective time of
the Subsidiary Bank Merger, each of the issued and outstanding shares of
common stock of Community Bank, $10.00 par value per share (the "Community
Bank Common"), other than (i) shares the holders of which have duly
exercised and perfected their dissenters' rights under applicable Illinois
banking law, (ii) shares held by SCB,

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16

and (iii) shares held by directors of Community Bank which are subject to
Director Qualifying Share Agreements, will be converted into the right to
receive cash in the amount of $277.01. In accordance with the policy of the
Illinois Commissioner of Banks and Trust Companies (the "Illinois
Commissioner"), Community Bank has obtained an independent fairness opinion
with respect to the fairness of the consideration to be received by the
Community Bank shareholders in exchange for their shares of Community Bank
Common.

Among other things, the Subsidiary Bank Merger is conditioned upon
receipt of applicable regulatory approvals from the Federal Deposit
Insurance Corporation (the "F.D.I.C.") and the Illinois Commissioner, and
the affirmative vote of at least two-thirds of the outstanding shares of
each of Community Bank and Boatmen's-South Central. SCB owns a sufficient
number shares of Community Bank Common (96.37%) to effect the Subsidiary
Bank Merger without the affirmative vote of other shareholders of Community
Bank. In the event the Merger Agreement is terminated, the Subsidiary
Merger Agreement shall also be terminated and the Subsidiary Bank Merger
shall be abandoned.

Applications with the F.D.I.C and the Illinois Commissioner for
approval of the Subsidiary Bank Merger have been filed and are pending.
It is anticipated that the Subsidiary Bank Merger would be consummated
contemporaneously with the Merger.

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COMPARATIVE STOCK PRICES

Shares of Boatmen's Common are traded in the over-the-counter market
and are listed on Nasdaq under the symbol BOAT. There is no established
trading market for SCB Common. The following table sets forth the high and
low last sale prices of Boatmen's Common for the periods indicated, as
reported on Nasdaq. The Boatmen's per share prices have been restated to
reflect Boatmen's 2-for-1 stock split (effected as a 100% stock dividend)
effective on October 1, 1993 (the "1993 Stock Split"). Management of SCB
is not aware of any sales of shares of SCB Common during the past three-
year period.

Boatmen's SCB
Common Stock Common Stock
------------ ------------

High Low High Low
---- --- ---- ---

1992 First Quarter. . . . . . . $24.19 $21.19 <F*> <F*>
Second Quarter . . . . . . 25.63 21.44 <F*> <F*>
Third Quarter. . . . . . . 26.63 25.00 <F*> <F*>
Fourth Quarter . . . . . . 28.25 24.75 <F*> <F*>

1993 First Quarter. . . . . . . 30.50 26.88 <F*> <F*>
Second Quarter . . . . . . 32.50 27.25 <F*> <F*>
Third Quarter. . . . . . . 32.38 29.19 <F*> <F*>
Fourth Quarter . . . . . . 33.50 27.50 <F*> <F*>

1994 First Quarter. . . . . . . 30.50 26.75 <F*> <F*>
Second Quarter . . . . . . 35.00 28.88 <F*> <F*>
Third Quarter. . . . . . . 34.88 30.13 <F*> <F*>
Fourth Quarter . . . . . . 31.13 26.25 <F*> <F*>

1995 First Quarter. . . . . . . 28.88 27.25 <F*> <F*>
(through January 19)

<FN>
- -------------------------------------------

<F*> Management of SCB is not aware of any sales of shares of SCB Common
during the past three-year period.

On September 22, 1994, the last trading day before the announcement
of the proposed Merger, the closing sale price of Boatmen's Common as
reported on Nasdaq was $31.125 per share. On such date, the equivalent per
share price for SCB Common, calculated on the basis of the Merger
Consideration, was $1,169.37.

On January 19, 1995, the closing sale prices of Boatmen's Common as
reported on Nasdaq was $28.4375 per share and the equivalent per share price
for SCB Common was $1,068.40. On such date, there were approximately
28,250 holders of record of Boatmen's Common and all of the SCB Common
was held by the 8 directors of SCB.

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SELECTED COMPARATIVE PER SHARE DATA<F1>
(unaudited)

The following summary presents comparative historical, pro forma and pro
forma equivalent unaudited per share data for Boatmen's and SCB. The pro
forma amounts also give effect to the pending acquisition of Worthen
Banking Corporation. See "THE PARTIES--Boatmen's--Pending Acquisitions"
and "PRO FORMA FINANCIAL DATA." The pro forma amounts assume the Merger
had been effective during the periods presented and has been accounted for
under the purchase method of accounting. For a description of the purchase
method of accounting with respect to the Merger, see "THE
MERGER--Accounting Treatment." The amounts designated "Pro Forma Combined
Per Boatmen's Share" represent the pro forma results of the Merger, the
amounts designated "Equivalent Pro Forma Per SCB Share" are computed by
multiplying the Pro Forma Combined Per Boatmen's Share amounts by a factor
of 37.57 to reflect the Merger Consideration (which equals 37.57 shares of
Boatmen's Common for each share of SCB Common). See "THE MERGER--Merger
Consideration." The data presented should be read in conjunction with the
consolidated historical financial statements and the related notes thereto
included herein or incorporated by reference herein, and the pro forma
consolidated financial statements included elsewhere in this Proxy
Statement/Prospectus. See "INCORPORATION OF CERTAIN DOCUMENTS BY
REFERENCE," "PRO FORMA FINANCIAL DATA," and "INDEX TO FINANCIAL STATEMENTS
OF SCB."

Nine Months Ended September 30, Year Ended
------------------------------- ----------
1994 1993 December 31, 1993
---- ---- -----------------
NET INCOME PER COMMON SHARE:

Historical
Boatmen's. . . . . . . . . . . . . . . $ 2.52 $ 2.32 $ 3.07
SCB . . . . . . . . . . . . . . . . . 83.55 83.29 108.93
Pro forma combined per
Boatmen's share. . . . . . . . . . . . 2.46 2.19 2.91
Equivalent pro forma
per SCB share . . . . . . . . . . . . 92.42 82.28 109.33

DIVIDENDS PER COMMON SHARE:

Historical
Boatmen's. . . . . . . . . . . . . . . $ 0.93 $ 0.84 $1.15
SCB . . . . . . . . . . . . . . . . . -- -- --
Pro forma combined per
Boatmen's share <F2> . . . . . . . . . 0.93 0.84 1.15
Equivalent pro forma
per SCB share <F3> . . . . . . . . . . 34.94 31.56 43.21

BOOK VALUE PER COMMON SHARE
(PERIOD END):

Historical
Boatmen's. . . . . . . . . . . . . . . $ 21.06 $ 19.66 $ 20.49
SCB . . . . . . . . . . . . . . . . . 587.06 500.26 530.58
Pro forma combined per
Boatmen's share. . . . . . . . . . . . 20.54 19.11 19.90
Equivalent pro forma
per SCB share . . . . . . . . . . . . 771.69 717.96 747.64

<FN>
- --------------

<F1> Reflects restatement of Boatmen's share amounts to give effect to the
1993 Stock Split.
<F2> Boatmen's pro forma dividends per share represent historical dividends
per share paid by Boatmen's.
<F3> Represents historical dividends per share paid by Boatmen's calculated
on the basis of the Merger Consideration.

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SELECTED FINANCIAL DATA

The following tables present selected consolidated historical
financial data for Boatmen's and SCB and unaudited pro forma combined
amounts reflecting the Merger. The pro forma amounts assume the Merger had
been effective during the periods presented. The data presented are
derived from the consolidated financial statements of Boatmen's and SCB and
should be read in conjunction with the more detailed information and
financial statements included herein or incorporated by reference in this
Proxy Statement/Prospectus. The data should also be read in conjunction
with the unaudited pro forma consolidated financial statements included
elsewhere in this Proxy Statement/Prospectus. See "INCORPORATION OF
CERTAIN DOCUMENTS BY REFERENCE," "PRO FORMA FINANCIAL DATA," and "INDEX TO
FINANCIAL STATEMENTS OF SCB."

BOATMEN'S BANCSHARES, INC.<F1>
SELECTED FINANCIAL DATA
(UNAUDITED)

Nine Months Ended September 30, Year Ended December 31,
------------------------------- --------------------------------------------------------
1994 1993 1993 1992 1991 1990 1989
---- ---- ---- ---- ---- ---- ----
(income statement amounts in thousands except per share
data and balance sheet amounts in millions)
Summarized Income Statement:
- ---------------------------

Net Interest Income. . . . . . . . $763,752 $727,847 $981,580 $877,716 $742,532 $655,801 $629,603
Provision for Loan Losses. . . . . 19,906 48,331 60,184 136,626 114,658 119,448 93,248
Noninterest Income . . . . . . . . 390,535 366,389 493,251 452,082 355,704 297,002 276,899
Noninterest Expense. . . . . . . . 732,282 696,620 950,421 871,928 752,367 651,962 605,426
Income Tax Expense . . . . . . . . 138,775 108,988 146,807 92,518 60,013 36,363 43,695
Net Income . . . . . . . . . . . . 263,324 240,297 317,419 228,726 171,198 145,030 164,133
Per Common Share Data<F2>:
- -------------------------
Net Income . . . . . . . . . . . . $2.52 $2.32 $3.07 $2.29 $1.77 $1.58 $1.81
Cash Dividends Paid. . . . . . . . 0.93 0.84 1.15 1.09 1.07 1.06 1.02
Stockholders' Equity
(period end) . . . . . . . . . . 21.06 19.66 20.49 18.20 16.94 15.84 15.42
Financial Position at Period End:
- --------------------------------
Loans, Net of Unearned Income. . . $16,105 $14,600 $14,826 $13,111 $12,316 $11,924 $11,593
Total Assets . . . . . . . . . . . 28,292 26,169 26,654 24,281 23,003 22,795 19,541
Deposits . . . . . . . . . . . . . 20,484 20,533 20,909 19,685 18,060 18,119 14,964
Long-Term Debt . . . . . . . . . . 515 471 486 393 316 285 295
Stockholders' Equity . . . . . . . 2,207 2,041 2,133 1,861 1,680 1,463 1,396
Selected Financial Ratios:
- -------------------------
Return on Average Assets . . . . . 1.29% 1.30% 1.27% 0.99% 0.79% 0.73% 0.86%
Return on Average Common
Equity<F3> . . . . . . . . . . . 16.19 16.37 15.99 12.95 10.78 10.13 12.06
Net Interest Margin. . . . . . . . 4.33 4.57 4.56 4.40 4.05 3.96 4.03
Nonperforming Assets as % of
Total Loans and Foreclosed
Property<F4> . . . . . . . . . . 1.58 2.12 1.90 2.92 3.92 3.93 3.38
Nonperforming Loans as % of Total
Loans. . . . . . . . . . . . . . 0.96 1.28 1.17 1.96 2.54 3.18 2.67
Loan Reserve as % of Net Loans . . 2.16 2.34 2.30 2.30 2.05 1.92 1.71
Net Charge-Offs as % of Average
Loans. . . . . . . . . . . . . . 0.13 0.21 0.24 0.80 0.84 0.76 1.00
Equity to Assets . . . . . . . . . 7.80 7.80 8.00 7.67 7.30 6.42 7.14
Tangible Equity to Assets<F5>. . . 6.94 6.78 7.04 6.88 6.56 5.73 6.46
Tier 1 Risk-Based Capital<F6>. . . 10.54 10.51 10.67 10.39 10.10 --- ---
Total Risk-Based Capital<F6> . . . 14.03 14.36 14.42 13.75 13.17 --- ---
<FN>
- ---------------------------
<F1> The information set forth in this table does not give effect to the
pending acquisitions of other financial institutions.
See "THE PARTIES -- Boatmen's -- Pending Acquisitions."
<F2> Reflects restatement of share amounts for the 1993 Stock Split.
<F3> Based on net income available to common shareholders.
<F4> Nonperforming assets include nonaccrual loans, restructured loans,
loans past due 90 days or more and foreclosed property.
<F5> Tangible equity to assets is defined as total equity less all
intangibles as a percentage of total tangible assets.
<F6> Calculated using final 1992 risk-based guidelines.

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20

SALEM COMMUNITY BANCORP, INC.
SELECTED FINANCIAL DATA
(UNAUDITED)

Nine Months Ended September 30, Year Ended December 31,
------------------------------- --------------------------------------------------------
1994 1993 1993 1992 1991 1990 1989
---- ---- ---- ---- ---- ---- ----
(income statement and balance sheet amounts in thousands except per share data)
Summarized Income Statement:
- ---------------------------

Net Interest Income . . . . . . . . $2,275 $2,181 $2,956 $2,610 $2,221 $2,081 $1,949
Provision for Loan Losses. . . . . 70 90 110 174 165 163 250
Noninterest Income . . . . . . . . 400 357 499 473 478 452 440
Noninterest Expense. . . . . . . . 1,706 1,565 2,199 2,085 2,002 1,964 1,803
Income Tax Expense . . . . . . . . 257 243 309 202 103 82 44
Net Income . . . . . . . . . . . . 642 640 837 622 429 324 292
Per Common Share Data:
- ---------------------
Net Income . . . . . . . . . . . . $83.55 $83.29 $108.93 $80.95 $55.83 $42.17 $38.00
Cash Dividends Paid. . . . . . . . -- -- -- -- -- -- --
Stockholders' Equity (period end): 587.06 500.26 530.58 416.84 335.89 280.06 237.77
Financial Position at Period End:
- --------------------------------
Loans, Net of Unearned Income. . . $50,821 $45,035 $47,401 $39,603 $37,927 $36,333 $35,103
Total Assets . . . . . . . . . . . 79,178 76,690 78,510 72,663 69,847 64,834 59,315
Deposits . . . . . . . . . . . . . 72,273 70,472 72,067 66,828 64,342 59,507 54,291
Note Payable . . . . . . . . . . . 1,700 1,875 1,750 2,000 2,250 2,400 2,524
Stockholders' Equity . . . . . . . 4,511 3,844 4,077 3,203 2,581 2,152 1,827
Selected Financial Ratios:
- -------------------------
Return on Average Assets<F1> . . . 1.08% 1.13% 1.10% 0.86% 0.64% 0.59% 0.57%
Return on Average Equity<F1> . . . 19.93 24.21 22.99 21.51 18.12 16.28 17.37
Net Interest Margin<F1>. . . . . . 4.25 4.35 4.36 4.10 3.81 3.93 3.76
Nonperforming Assets as % of
Total Loans and Foreclosed
Property<F2> . . . . . . . . . . 0.05 0.24 0.02 0.37 1.66 0.70 0.67
Nonperforming Loans as % of
Total Loans. . . . . . . . . . . 0.05 0.24 0.02 0.33 1.62 0.70 0.87
Loan Reserve as % of Net Loans . . 1.30 1.29 1.27 1.28 1.09 0.98 0.87
Net Charge-Offs as % of Average
Loans<F1>. . . . . . . . . . . . 0.02 0.03 0.03 0.20 0.30 0.32 0.89
Equity to Assets . . . . . . . . . 5.44 4.66 4.77 4.01 3.55 3.21 2.94
Tangible Equity to Assets<F3>. . . 5.64 4.69 4.86 4.08 3.34 2.93 2.64
Tier 1 Risk-Based Capital<F4>. . . 7.34 6.89 7.13 6.16 5.15 4.61 3.98
Total Risk-Based Capital<F4> . . . 8.46 8.03 8.28 7.25 6.08 5.51 4.80

<FN>
- ---------------------------
<F1> Ratios for the nine months ended September 30, 1994 and 1993 are
annualized.
<F2> Nonperforming assets include nonaccrual loans, restructured loans,
loans past due 90 days or more and foreclosed property.
<F3> Tangible equity to assets is defined as total equity less all
intangibles as a percentage of total tangible assets.
<F4> Calculated using final 1992 risk-based guidelines.

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21

BOATMEN'S BANCSHARES, INC.
AND
SALEM COMMUNITY BANCORP, INC.
PRO FORMA COMBINED SELECTED FINANCIAL DATA<F1>
(UNAUDITED)

Nine Months Ended September 30, Year Ended
------------------------------- -----------------
1994 1993 December 31, 1993
---- ---- -----------------

(income statement amounts in thousands except per share
data and balance sheet amounts in millions)

Summarized Income Statement:
- ---------------------------

Net Interest Income. . . . . . . . $871,972 $828,264 $1,117,354
Provision for Loan Losses. . . . . 21,026 52,200 64,922
Noninterest Income . . . . . . . . 441,519 418,225 560,341
Noninterest Expense. . . . . . . . 833,997 810,093 1,100,057
Income Tax Expense . . . . . . . . 159,131 120,489 162,448
Net Income<F2> . . . . . . . . . . 299,337 263,707 350,268
Per Common Share Data:
- ---------------------
Net Income . . . . . . . . . . . . $2.46 $2.19 $2.91
Cash Dividends Paid. . . . . . . . 0.93 0.84 1.15
Stockholders' Equity (period end) 20.54 19.11 19.90
Financial Position at Period End:
- --------------------------------
Loans, Net of Unearned Income. . . $18,055 $16,257 $16,520
Total Assets . . . . . . . . . . . 31,891 29,869 30,307
Deposits . . . . . . . . . . . . . 23,517 23,683 24,024
Long-Term Debt . . . . . . . . . . 558 514 530
Stockholders' Equity . . . . . . . 2,509 2,309 2,410
Selected Financial Ratios:
- -------------------------
Return on Average Assets . . . . . 1.29% 1.25% 1.23%
Return on Average Common
Equity<F3> . . . . . . . . . . . 16.23 15.90 15.61
Net Interest Margin. . . . . . . . 4.35 4.52 4.52
Nonperforming Assets as % of
Total Loans and Foreclosed
Property<F4> . . . . . . . . . . 1.49 2.06 1.85
Nonperforming Loans as % of
Total Loans. . . . . . . . . . . 0.92 1.27 1.16
Loan Reserve as % of Net Loans . . 2.11 2.31 2.27
Net Charge-Offs as % of Average
Loans. . . . . . . . . . . . . . 0.12 0.19 0.23
Equity to Assets . . . . . . . . . 7.87 7.73 7.95
Tangible Equity to Assets<F5>. . . 7.02 6.74 7.01
Tier 1 Risk-Based Capital<F6>. . . 10.78 10.64 10.85
Total Risk-Based Capital<F6> . . . 14.04 14.23 14.33

<FN>
<F1> The information set forth in this table gives effect to the pending
acquisition of Worthen Banking Corporation which was announced on
August 18, 1994. See "PRO FORMA FINANCIAL DATA".
<F2> Net income includes $868 thousand for the nine months ended
September 30, 1993 and year ended December 31, 1993, for the
cumulative effect of FAS No. 109 adoption by Worthen. In addition,
net income includes amortization of goodwill which would result
from the acquisition of SCB as if the goodwill existed as of the
earliest period presented. Goodwill will approximate $3.6 million
to be amortized over 15 years.
<F3> Based on net income available to common shareholders.
<F4> Nonperforming assets include nonaccrual loans, restructured loans,
loans past due 90 days or more and foreclosed property.
<F5> Tangible equity to assets is defined as total equity less all
intangibles as a percentage of total tangible assets.
<F6> Calculated using final 1992 risk-based guidelines.

15
22

THE SPECIAL MEETING

DATE, TIME AND PLACE OF SPECIAL MEETING

This Proxy Statement/Prospectus is being furnished to shareholders of
Salem Community Bancorp, Inc., an Illinois corporation ("SCB"), in
connection with the solicitation of proxies by the Board of Directors of
SCB for use at the Special Meeting of Shareholders to be held at the
offices of Community State Bank at 401 West Main Street, Salem, Illinois
62881 on February 22, 1995, at 10:30 a.m., local time (the "Special
Meeting").

MATTERS TO BE CONSIDERED AT THE SPECIAL MEETING

At the Special Meeting, the shareholders of SCB will be asked to
approve the Agreement and Plan of Merger, dated September 1, 1994, as
amended on September 28, 1994 and December 2, 1994 (as amended, the "Merger
Agreement"), by and among SCB, Boatmen's Bancshares, Inc., a Missouri
corporation ("Boatmen's"), and Boatmen's-Illinois, Inc., a Missouri
corporation and wholly-owned subsidiary of Boatmen's ("Boatmen's-
Illinois"), providing for, among other matters, the merger of SCB with and
into Boatmen's-Illinois. In addition, the holders of SCB Common may be
asked to vote on a proposal to adjourn or postpone the Special Meeting
which adjournment or postponement could be used for the purpose, among
others, of allowing additional time for the solicitation of additional
votes to approve the Merger Agreement.

RECORD DATE FOR SPECIAL MEETING

The Board of Directors of SCB has fixed the close of business on
January 18, 1995, as the record date for the determination of holders of
common stock, par value $1.00 per share, of SCB ("SCB Common") to receive
notice of and to vote at the Special Meeting. On the record date, there
were 7,684 shares of SCB Common outstanding, all of which were held by the
directors of SCB. Only holders of shares of SCB Common of record on the
record date are entitled to vote at the Special Meeting. No shares of SCB
Common can be voted at the Special Meeting unless the record holder is
present in person or represented by proxy at the Special Meeting.

VOTE REQUIRED TO APPROVE THE MERGER AGREEMENT

The affirmative vote of two-thirds (2/3) of the outstanding shares of
SCB Common entitled to vote thereon is required to approve the Merger
Agreement. Each holder of SCB Common is entitled to one vote per share of
SCB Common. As of the record date, the directors of SCB and their
affiliates have the power to vote 7,684 shares of SCB Common, or one
hundred percent (100%) of the shares outstanding, all of which are expected
to be voted by such persons in favor of the Merger Agreement. For
information regarding the shares of SCB Common beneficially owned, directly
or indirectly, by certain shareholders, by each director and executive
officer of SCB, and by all directors and officers of SCB as a group, see
"INFORMATION ABOUT SCB -- Security Ownership of Certain Beneficial Owners
and Management of SCB." As of the record date, directors and executives
officers of Boatmen's did not own beneficially any shares of SCB Common.

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23

VOTING AND REVOCATION OF PROXIES FOR SPECIAL MEETING

Proxies for use at the Special Meeting accompany this Proxy Statement/
Prospectus. A shareholder may use his or her proxy if he or she is unable
to attend the Special Meeting in person or wishes to have his or her shares
voted by proxy even if he or she does attend the Special Meeting. Shares
of SCB Common represented by a proxy properly signed and returned to SCB
at, or prior to, the Special Meeting, unless subsequently revoked, will be
voted at the Special Meeting in accordance with instructions thereon. If
a proxy is properly signed and returned and the manner of voting is not
indicated on the proxy, any shares of SCB Common represented by such proxy
will be voted FOR the Merger Agreement and FOR any proposal regarding
adjournment or postponement, if such a proposal is made. Any proxy given
pursuant to this solicitation may be revoked by the grantor at any time
prior to the voting thereof by filing with the Secretary of SCB a written
revocation or a duly executed proxy bearing a later date. A holder of SCB
Common may withdraw his or her proxy at the Special Meeting at any time
before it is exercised by electing to vote in person; however, attendance
at the Special Meeting will not in and of itself constitute a revocation
of the proxy.

SOLICITATION OF PROXIES FOR THE SPECIAL MEETING

In addition to solicitation of proxies from shareholders of SCB Common
by use of the mail, proxies also may be solicited by personal interview,
telephone and wire by directors, officers and employees of SCB, who will
not be specifically compensated for such services. Except as set forth
below, all costs of soliciting proxies, assembling and mailing the Proxy
Statement/Prospectus and all papers which now accompany or hereafter may
supplement the same will be borne by SCB.

EXPENSES FOR PREPARATION OF PROXY STATEMENT/PROSPECTUS

Boatmen's and SCB have agreed to share in the expense of preparation
of this Proxy Statement/Prospectus, and Boatmen's will bear the entire cost
of printing this Proxy Statement/Prospectus and all Securities and Exchange
Commission ("S.E.C.") and other regulatory filing fees incurred in
connection therewith.

MAILING DATE OF PROXY STATEMENT/PROSPECTUS

This Proxy Statement/Prospectus, the attached notice of Special
Meeting and the enclosed proxy card are first being sent to shareholders
of SCB on or about January 20, 1995 (the "Mailing Date").

THE PARTIES

BOATMEN'S

GENERAL

Boatmen's is a multi-bank holding company headquartered in St. Louis,
Missouri. Its largest subsidiary, The Boatmen's National Bank of
St. Louis, was founded in 1847 and is the oldest bank west of the
Mississippi River. Boatmen's owns substantially all of the capital stock
of 45 subsidiary banks, including

17
24
a federal savings bank, which operate from over 400 banking locations in
Missouri, Arkansas, Illinois, Iowa, Kansas, New Mexico, Oklahoma, Tennessee
and Texas. Boatmen's other principal businesses include a trust company, a
mortgage banking company, a credit life insurance company, a credit card bank
and an insurance agency. At September 30, 1994, Boatmen's had consolidated
assets of approximately $28.3 billion and total shareholders' equity of
approximately $2.2 billion, making it one of the 30 largest bank holding
companies in the United States.

Boatmen's is among the sixteen largest providers of personal trust
services in the nation, providing personal trust services primarily within
its banks' market areas and institutional and pension-related trust
services on a national scale. Operating principally through Boatmen's
Trust Company, its subsidiaries and trust departments of selected banks,
the combined trust operations had assets under management totaling
approximately $35.5 billion at September 30, 1994. The trust operations,
with revenues in 1993 of $152.2 million, provide Boatmen's with a
significant source of noninterest income.

PENDING ACQUISITIONS

Dalhart Bancshares, Inc. On May 19, 1994, Boatmen's entered into an
------------------------
Agreement and Plan of Merger to acquire, for shares of Boatmen's Common,
all of the issued and outstanding shares of Dalhart Bancshares, Inc., a
bank holding company headquartered in Dalhart, Texas ("Dalhart"), and all
of the issued and outstanding shares of Dalhart's 93.17%-owned subsidiary,
Citizens State Bank of Dalhart ("Citizens"), a Texas state-chartered bank
also headquartered in Dalhart, Texas. At September 30, 1994, Dalhart had
consolidated assets of approximately $134 million and shareholders' equity
of approximately $13 million. Upon consummation of the acquisition,
Boatmen's intends to merge Citizens with Boatmen's First National Bank of
Amarillo, a national banking association and indirect wholly-owned
subsidiary of Boatmen's headquartered in Amarillo, Texas. The total number
of shares of Boatmen's Common to be issued in the Dalhart transaction will
not exceed 764,000, which represents less than one percent (1%) of the
total number of shares of Boatmen's Common outstanding as of the date
hereof. The Dalhart acquisition, which is subject to, among other things,
approval of the shareholders of Dalhart, is expected to be completed early
in the first quarter of 1995. There can be no assurance that the
transaction will be consummated. Consummation of the Merger is not
conditioned upon consummation of the Dalhart acquisition.

National Mortgage Company. On July 7, 1994, Boatmen's entered into
-------------------------
an Agreement to acquire National Mortgage Company, headquartered in
Memphis, Tennessee. National Mortgage Company is a privately-owned, full
service mortgage banking company which originates home loans through 10
company-operated offices as well as through a network of over 300
correspondent locations in Southern and Midwestern parts of the United
States. National Mortgage Company's 1993 originations totalled
approximately $1.7 billion and its loan servicing portfolio was
approximately $13.1 billion at June 30, 1994. Under the terms of the
Agreement, Boatmen's would exchange approximately five million shares of
Boatmen's Common for all of the stock of National Mortgage Company's parent
corporations and affiliated entities. The shares of Boatmen's Common to
be issued in connection with the acquisition constitute less than five
percent (5%) of the outstanding shares of Boatmen's Common as of the date
hereof. When combined with Boatmen's existing servicing portfolio,
Boatmen's will rank among the 30 largest mortgage companies in the country.
The acquisition, which is subject to, among other things, approval of the
shareholders of National Mortgage Company's parent corporations, is
expected to be completed early in the first quarter of 1995. There can be
no assurance that the transaction will be consummated. Consummation of the
Merger is not conditioned upon consummation of the National Mortgage
Company acquisition.

Worthen Banking Corporation. On August 18, 1994, Boatmen's entered
---------------------------
into an Agreement and Plan of Merger (the "Worthen Agreement") to acquire
Worthen Banking Corporation, the second largest banking

18
25
organization in Arkansas. Worthen is a publicly-held, multi-bank holding
company headquartered in Little Rock, Arkansas, operating 112 retail banking
offices throughout the State of Arkansas and six such offices in the
Austin, Texas area. Through its non-banking subsidiaries, Worthen also
operates, among other businesses, a full service retail brokerage company,
a mortgage banking company and a trust company. At September 30, 1994,
Worthen had consolidated assets of approximately $3.5 billion, deposits of
approximately $3.0 billion and loans of approximately $1.9 billion. The
Board of Directors of Boatmen's believes that the acquisition of Worthen
and its banking subsidiaries would enhance its presence in the State of
Arkansas and would be a natural and desirable extension of its banking
franchise in the Central United States. Under the terms of the Worthen
Agreement, each share of Worthen common stock, other than shares any
holders of which have duly perfected their dissenters' rights under the
Arkansas Business Corporation Act, will be converted into the right to
receive one (1) share of Boatmen's Common, plus cash in lieu of fractional
shares. Boatmen's would exchange approximately 17.3 million shares of
Boatmen's Common for all of the stock of Worthen (including shares subject
to stock options). The shares of Boatmen's Common to be issued in
connection with the acquisition of Worthen would constitute approximately
sixteen and one-half percent (16.5%) of the total number of shares of
Boatmen's Common outstanding as of the date hereof. The acquisition of
Worthen, which is expected to be completed in the first quarter of 1995,
is subject to various conditions including approval of the Worthen
Agreement by the requisite vote of the shareholders of Worthen, receipt of
reaffirmation of the opinion of PaineWebber, Inc., Worthen's investment
banker, to the effect that the transaction is fair to Worthen and its
shareholders from a financial point of view, and regulatory approvals of
the Board of Governors of the Federal Reserve System (the "Federal
Reserve"), the Arkansas Commissioner of Financial Institutions and the
Texas Department of Banking. Regulatory applications were filed with the
Federal Reserve on October 7, 1994, the Arkansas Commissioner of Financial
Institutions on November 1, 1994, and the Texas Department of Banking on
November 17, 1994. The Federal Reserve and the Texas Department of Banking
have each approved the necessary regulatory applications, and the regulatory
application filed with the Arkansas Commission of Financial Institutions is
pending. There can be no assurance that all necessary regulatory approvals
will be obtained or that all conditions to the Worthen Agreement will be
satisfied such that the acquisition of Worthen will be consummated.
Consummation of the Merger is not conditioned upon consummation of the
Worthen acquisition.

First National Bank in Pampa. On November 15, 1994, Boatmen's
----------------------------
announced the execution of an Agreement and Plan of Merger, dated
November 14, 1994, to acquire, in exchange for shares of Boatmen's Common,
all of the issued and outstanding shares of capital stock of First National
Bank in Pampa, a national banking association located in the panhandle of
Texas ("Pampa"). At September 30, 1994, Pampa had assets of approximately
$168 million and shareholders' equity of approximately $30 million. Under
the terms of the Agreement, Pampa would be merged with and into Boatmen's
First National Bank of Amarillo. Boatmen's would exchange approximately
1.35 million shares of Boatmen's Common for all of the stock of Pampa,
which represents less than two percent (2%) of the total number of shares
of Boatmen's Common outstanding as of the date hereof. The Pampa
acquisition, which is subject to, among other things, regulatory approval
and approval by Pampa's shareholders, is expected to be completed in the
second quarter of 1995. There can be no assurance that the transaction
will be consummated. Consummation of the Merger is not conditioned upon
consummation of the Pampa acquisition.

West Side Bancshares, Inc. On November 15, 1994, Boatmen's announced
--------------------------
the execution of an Agreement and Plan of Merger, dated November 14, 1994,
to acquire, in exchange for shares of Boatmen's Common, all of the issued
and outstanding shares of West Side Bancshares, Inc., a bank holding
company headquartered in San Angelo, Texas ("West Side"), and its wholly-
owned banking subsidiary, Bank of the West, a Texas state-chartered banking
association also headquartered in San Angelo, Texas. At September 30,
1994, West Side had consolidated assets of approximately $142 million and
shareholders' equity of approximately $11 million. Upon consummation of
the transaction, Boatmen's intends to merge Bank of the West with Boatmen's
First National Bank of Amarillo. Boatmen's would exchange

19
26
approximately 600,000 shares of Boatmen's Common for all of the stock of West
Side, which represents less than one percent (1%) of the total number of
shares of Boatmen's Common outstanding as of the date hereof. The West Side
acquisition, which is subject to, among other things, regulatory approval
and approval by West Side's shareholders, is expected to be completed in
the first quarter of 1995. There can be no assurance that the transaction
will be consummated. Consummation of the Merger is not conditioned upon
consummation of the West Side acquisition.

BOATMEN'S-ILLINOIS

Boatmen's-Illinois was organized as a wholly-owned subsidiary of
Boatmen's solely to effectuate the Merger and has not engaged in any
significant business activity. Boatmen's will contribute all of the
capital stock of Boatmen's Bank of South Central Illinois, an Illinois
state-chartered bank ("Boatmen's-South Central"), to Boatmen's-Illinois
immediately prior to consummation of the Merger and the Subsidiary Bank
Merger. In connection with the Merger, Boatmen's has caused Boatmen's-
South Central, and SCB has caused Community State Bank, an Illinois state-
chartered bank and 96.37 percent owned subsidiary of SCB ("Community
Bank"), to enter into an Agreement to Merge, dated September 1, 1994, as
amended on September 28, 1994 and December 2, 1994 (as amended, the
"Subsidiary Merger Agreement"), which provides for, among other
things, the merger of Community Bank with and into Boatmen's-South
Central ("the "Subsidiary Bank Merger"). See "THE MERGER -- Certain
Other Agreements." At September 30, 1994, Boatmen's-South Central
had assets of approximately $143 million, deposits of approximately
$130 million and shareholders' equity of approximately $12 million.

SCB

SCB is a one-bank holding company founded on January 31, 1985 and
headquartered in Salem, Illinois. SCB owns 96.37 percent of the
outstanding capital stock of Community Bank (including director qualifying
shares). The business of SCB consists primarily of the ownership,
supervision and control of Community Bank. At September 30, 1994, SCB had
consolidated assets of approximately $79.2 million and shareholders' equity
of approximately $4.5 million.

THE MERGER

BACKGROUND OF AND REASONS FOR THE MERGER

Community Bank was founded in 1958 and has served its banking area as
a community bank since that date. SCB was formed as a one-bank holding
company and acquired 96.37 percent of the shares of Community Bank in 1985.
In July 1994, Boatmen's approached the Board of Directors of SCB with its
proposal to acquire SCB, which resulted ultimately in the Merger Agreement.
Because the eight directors of SCB collectively own all (100%) of the SCB
Common, the Board of Directors had the input of all of SCB's shareholders
in its consideration of such proposal, as discussed below.

The Board of Directors reviewed the Boatmen's offer with its legal and
accounting advisors, as well as with other sources of financial information
deemed to be reliable by the Board. The SCB Board of Directors also took
into consideration the legal, regulatory, and other factors affecting
competition among commercial banks, as well as a review of the financial,
economic, and market considerations. The Board of Directors of SCB
concluded, after this review, that an affiliation with a larger, more
diversified banking

20
27
organization would be in the best interests of SCB, the shareholders of SCB,
Community Bank, the employees of Community Bank, and the customers and
communities served by SCB and Community Bank, and that, in the opinion of the
SCB Board of Directors, the value of the Boatmen's Common to be received in
the exchange for the SCB Common represents a fair price to the SCB
shareholders. Accordingly, the Board recommends that shareholders of SCB vote
for approval and adoption of the Merger Agreement.

RECOMMENDATION OF THE BOARDS OF DIRECTORS

FOR THE REASONS SET FORTH ABOVE, THE BOARD OF DIRECTORS OF SCB
RECOMMENDS THAT THE HOLDERS OF SCB COMMON VOTE "FOR" APPROVAL AND ADOPTION
OF THE MERGER AGREEMENT.

MERGER CONSIDERATION

The Merger Agreement provides that each share of SCB Common, other
than shares held by any shareholder properly exercising dissenters' rights
under the Illinois Business Corporation Act of 1983 (the "Illinois Law"),
will be converted, at the effective time of the Merger (the "Effective
Time"), into the right to receive 37.57 shares of Boatmen's Common,
together with any rights attached thereto under or by virtue of the Rights
Agreement, dated August 14, 1990, between Boatmen's and Boatmen's Trust
Company, as Rights Agent (see "COMPARISON OF SHAREHOLDER RIGHTS --
Shareholder Rights Plan"), plus cash in lieu of fractional shares, as
described herein (the "Merger Consideration"). The Merger Consideration
was determined through negotiations, taking into account the relative value
of Boatmen's Common and SCB Common, between Boatmen's and SCB.

No fractional shares of Boatmen's Common will be issued. In the event
a holder of shares of SCB Common would be entitled, in the aggregate, to
a fractional share interest in Boatmen's Common, then, in lieu of issuing
such fractional share, Boatmen's will pay to such holder an amount of cash
equal to such fraction multiplied by the average closing price of a share
of Boatmen's Common on the Nasdaq Stock Market's National Market ("Nasdaq")
on the business day immediately preceding the date on which the Merger is
consummated.

If, prior to the Effective Time, a share of Boatmen's Common would be
changed into a different number of shares of Boatmen's Common or a
different class of shares by reason of reclassification, recapitalization,
splitup, exchange of shares or readjustment, or if a stock dividend thereon
should be declared with a record date prior to the Effective Time (a "Share
Adjustment"), then the number of shares of Boatmen's Common into which a
share of SCB Common would be converted pursuant to the Merger Agreement
will be appropriately and proportionately adjusted so that each shareholder
of SCB will be entitled to receive such number of shares of Boatmen's
Common as such shareholder would have received

21
28
pursuant to such Share Adjustment had the record date thereof been immediately
following the Effective Time.

FORM OF THE MERGER

The Merger Agreement provides that SCB will merge into Boatmen's-
Illinois, which is a wholly-owned subsidiary of Boatmen's, Boatmen's-
Illinois will be the surviving corporation, and the separate corporate
existence of SCB will cease.

CONDUCT OF BUSINESS PENDING THE MERGER; DIVIDENDS

Pursuant to the Merger Agreement, SCB has agreed to carry on its
business in the usual, regular and ordinary course in substantially the
same manner as conducted prior to the execution of the Merger Agreement.
The Merger Agreement provides that SCB may not declare or pay a dividend
on the SCB Common or make any other distribution to shareholders, whether
in cash, stock or other property, after the date of the Merger Agreement.

CONDITIONS TO CONSUMMATION OF THE MERGER

The Merger is subject to various conditions. Specifically, the
obligations of each party to effect the Merger are subject to the
fulfillment or waiver by each of the parties, at or prior to the date on
which the Merger is consummated (the "Closing Date") of the following
conditions: (i) the representations and warranties of the respective
parties to the Merger Agreement set forth in the Merger Agreement will be
true and correct in all material respects on the date thereof and as of the
Closing Date; (ii) each of the respective parties to the Merger Agreement
will have performed and complied in all material respects with all of its
obligations and agreements required to be performed prior to the Closing
Date; (iii) no party to the Merger Agreement will be subject to any order,
decree or injunction of a court or agency of competent jurisdiction which
enjoins or prohibits the consummation of the Merger; (iv) all necessary
regulatory approvals and consents required to consummate the Merger,
including the approval of the shareholders of SCB, will have been obtained
and all waiting periods in respect thereof will have expired; (v) each
party will have received all required documents from the other party;
(vi) the Registration Statement relating to the Boatmen's Common to be
issued pursuant to the Merger will have become effective, and no stop order
suspending the effectiveness of the Registration Statement will have been
issued and no proceedings for that purpose will have been initiated or
threatened by the S.E.C. or any securities agency; (vii) Boatmen's will
have received an opinion of Lewis, Rice & Fingersh, L.C., counsel to
Boatmen's, to the effect that (a) the Merger will constitute a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code of 1986, as amended (the "Code"), (b) no gain or loss will be
recognized by the holders of SCB Common upon receipt of the Merger
Consideration (except for cash received in lieu of fractional shares),
(c) the basis of shares of Boatmen's Common received by the shareholders
of SCB will be the same as the basis of shares of SCB Common exchanged
therefor, and (d) the holding period of the shares of Boatmen's Common
received by the shareholders of SCB will include the holding period of the
shares of SCB Common exchanged therefor, provided such shares were held as
capital assets as of the effective time of the Merger; and (viii) the
Subsidiary Bank Merger shall be consummated on the Closing Date.

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REGULATORY APPROVALS

The Merger is subject to the prior approval of the Federal Reserve.
Acquisitions subject to Federal Reserve approval under the Bank Holding
Company Act of 1956, such as the Merger, may not be consummated until
thirty (30) days after the date of the approval by the Federal Reserve,
during which period the United States Department of Justice may in its
discretion challenge the transaction under the antitrust laws. If,
however, the Federal Reserve has not received any adverse comments from the
United States Attorney General relating to the competitive aspects of the
transaction and the Attorney General has consented to a shorter waiting
period, then the Merger may be consummated after the fifteenth day
following the date of the approval by the Federal Reserve. An application
for the required regulatory approval from the Federal Reserve has been
filed and is pending. In addition, applications have been filed with each
of the Federal Deposit Insurance Corporation (the "F.D.I.C.") and the
Illinois Commission of Banks and Trust Companies (the "Illinois
Commissioner") for approval of the Subsidiary Bank Merger and are pending.
See "THE MERGER -- Certain Other Agreements."

TERMINATION OR ABANDONMENT

The Merger Agreement may be terminated at any time prior to the
Effective Time: (i) by either party if the Merger is not consummated on
or prior to September 1, 1995; (ii) by mutual agreement of Boatmen's and
SCB; (iii) by Boatmen's or SCB in the event of a material breach by the
other of any of its representations and warranties or agreements under the
Merger Agreement not cured within thirty (30) days after notice of such
breach is given by the non-breaching party; (iv) by either party in the
event all the conditions to its obligations are not satisfied or waived
(and not cured within any applicable cure period); (v) by Boatmen's in the
event that SCB or Community Bank becomes a party or subject to any new or
amended written agreement, memorandum of understanding, cease and desist
order, imposition of civil money penalties or other regulatory enforcement
action or proceeding with any federal or state agency charged with the
supervision or regulation of banks or bank holding companies after the date
of the Merger Agreement; (vi) by Boatmen's if certain reports of
environmental inspection on the real properties of SCB to be obtained
pursuant to the Merger Agreement should disclose any contamination or
presence of hazardous wastes, the estimated clean up or other remedial cost
of which exceeds $250,000, as reasonably estimated by an environmental
expert retained for such purpose by Boatmen's and reasonably acceptable to
SCB, or if the cost of such actions and measures cannot be so reasonably
estimated by such expert with any reasonable degree of certainty; provided,
however, that Boatmen's must exercise such termination right within ten
(10) business days following receipt of such estimate or indication that
the cost of such actions and measures cannot be so reasonably estimated,
and provided further that termination of the Merger Agreement shall be
Boatmen's sole remedy in such event; (vii) should any regulatory
application filed in connection with the Merger or the Subsidiary Bank
Merger be finally denied or disapproved by the respective regulatory
authority; and (viii) by either party, should the shareholders of SCB not
approve the Merger.

PAYMENT UPON OCCURRENCE OF CERTAIN TRIGGERING EVENTS

The Merger Agreement provides that upon the occurrence of one or more
Triggering Events (defined below), SCB will pay to Boatmen's the sum of
Five Hundred Thousand Dollars ($500,000).

As used in the Merger Agreement, the term "Triggering Event" means any
of the following events: (i) termination of the Merger Agreement by
Boatmen's upon a breach thereof by SCB, provided that within

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twelve (12) months of the date of such termination, either an event described
in clause (ii) or (iii) of this sentence shall have occurred; (ii) any person
or group of persons (other than Boatmen's) acquires, or has the right to
acquire, fifty percent (50%) or more of the outstanding shares of SCB
Common; (iii) upon the entry by SCB or Community Bank into an agreement or
other understanding with a person or group of persons (other than Boatmen's
and/or its affiliates) for such person or group of persons to acquire,
merge or consolidate with SCB or Community Bank or to purchase all or
substantially all of SCB's or Community Bank's assets; or (iv) the failure
of SCB's shareholders to approve the Merger and the Merger Agreement at the
Special Meeting; provided, however, that the failure of SCB shareholders
to approve the Merger and the Merger Agreement shall not be deemed a
Triggering Event if (a) the average of the daily closing prices of a share
of Boatmen's Common, as reported on Nasdaq during the period of twenty (20)
trading days ending at the end of the second trading day immediately
preceding the Mailing Date (the "Boatmen's Final Price"), is less than
$26.00, and (b) the number obtained by dividing the Boatmen's Final Price
by the Boatmen's Initial Price (as defined below), is less than the number
obtained by dividing the Final Index Price (as defined below) by the
Initial Index Price (as defined below) and subtracting .20 from such
quotient.

As used above, (a) "Index Group" means all of the bank holding
companies listed on Exhibit 7.09 to the Merger Agreement, the common stock
of which is publicly traded and as to which there is no pending publicly
announced proposal at any time during the period of twenty (20) trading
days ending at the end of the fifth trading day immediately preceding the
Closing Date for such company to be acquired or to acquire another company
(which would constitute a "significant subsidiary" of such company as such
term is defined under applicable S.E.C. regulations) in exchange for its
stock; (b) "Boatmen's Initial Price" means the closing price of a share of
Boatmen's Common on September 1, 1994 ($33.6250); (c) "Initial Index Price"
means the weighted average (weighted in accordance with the factors
specified on Exhibit 7.09 to the Merger Agreement) of the per share closing
prices of the common stock of the bank holding companies comprising the
Index Group, as reported on the consolidated transactions reporting system
for the market or exchange on which such common stock is principally
traded, on September 1, 1994; (d) "Final Price" of any company belonging
to the Index Group means the average of the daily closing sale prices of
a share of common stock of such company, as reported in the consolidated
transaction reporting system for the market or exchange on which such
common stock is principally traded, during the period of twenty (20)
trading days ending at the end of the second trading day immediately
preceding the Mailing Date; and (e) "Final Index Price" means the weighted
average (weighted in accordance with the factors specified on Exhibit 7.09
to the Merger Agreement) of the Final Prices for all of the companies
comprising the Index Group.

DISSENTERS' RIGHTS

The rights of SCB shareholders who choose to dissent from the Merger
are governed by the provisions of the Illinois Law. An excerpt of the
Illinois Law (Sections 11.65 and 11.70) governing dissenters' rights is
attached hereto as Appendix B. Pursuant to Section 11.70 of the Illinois
Law, a shareholder of SCB Common may assert dissenters' rights only if such
shareholder (i) delivers to SCB, prior to the vote to be taken at the SCB
Special Meeting with respect to approval of the Merger Agreement, a written
demand for payment for his or her shares of SCB Common if the Merger is
consummated and (ii) does not vote in favor of the Merger Agreement.

Within ten (10) days after the date on which the action giving rise
to the right to dissent is effective, or thirty (30) days after the
shareholder delivers to SCB the written demand for payment, whichever is
later, SCB will send each shareholder who has delivered a written demand
for payment a statement setting forth the opinion of SCB as to the
estimated fair value of the shares of SCB Common, SCB's latest balance
sheet as of the end of the fiscal year ending not earlier than 16 months
before the delivery of the statement,

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together with the statement of income for the year and the latest available
interim financial statements, and either a commitment to pay for the shares of
SCB Common of the dissenting shareholder at the estimated fair value thereof
upon transmittal to SCB of the certificate or certificates, or other evidence
of ownership, with respect to such shares of SCB Common or, if there is a
public market for SCB Common, directions to the dissenting Shareholder to sell
his or her shares within ten (10) days of the delivery of SCB's statement to
the shareholder. Currently there is no public market for SCB Common nor is a
public market expected to develop.

A shareholder who makes a written demand for payment retains all other
rights of a shareholder until those rights are canceled or modified by the
consummation of the proposed transaction. Upon consummation of the Merger,
SCB will pay to each dissenter who transmits to SCB the certificate or
certificates or other evidence of ownership of the shares the amount SCB
estimates to be the fair value of the shares, plus accrued interest,
accompanied by a written explanation of how the interest was calculated.

If the dissenting shareholder does not agree with the opinion of SCB
as to the estimated fair value of the shares or the amount of interest due,
such shareholder, within thirty (30) days from the delivery of SCB's
statement of value, must notify SCB in writing of his or her estimated fair
value and amount of interest due and demand payment for the difference
between the shareholder's estimate of fair value and interest due and the
amount of the payment by SCB or the proceeds of sale by the shareholder,
whichever is applicable.

If within sixty (60) days from the delivery to SCB of the
shareholder's notification of estimate of fair value of the shares and
interest due, SCB and the dissenting shareholder have not agreed in writing
upon the fair value and interest due, SCB must either pay the difference
in value demanded, with interest, or file a petition in the Circuit Court
of Marion County, Illinois, requesting the court to determine the fair
value of the shares of SCB Common and interest due. SCB must make all
dissenters, whether or not residents of Illinois, whose demands remain
unsettled parties to such proceeding, and all parties will be served with
a copy of the petition. Failure of SCB to commence an action will not
limit or affect the right of dissenting shareholders to otherwise commence
an action as permitted by law. The court may appoint one or more persons
as appraisers to receive evidence and recommend decision on the question
of fair value. Each dissenter made a party to a proceeding is entitled to
judgment for the amount, if any, by which a court finds the fair value of
the shares, plus interest, exceeds the amount paid by SCB or the proceeds
of sale by the shareholder, whichever is applicable. The court will
determine all costs of the proceeding, including the reasonable
compensation and expenses of the appointed appraisers, if any, but will
exclude the fees and expenses of counsel and experts for any party. If the
fair value of the shares as determined by the court materially exceeds the
amount SCB estimated to be the fair value or if no estimate was made, then
all or any part of such expenses may be assessed against SCB. If the
amount which any dissenter estimated to be the fair value of the shares
materially exceeds the fair value of the shares as determined by the court,
then all or any part of the cost may be assessed against that dissenter.
The court may also assess the fees and expenses of counsel and experts for
the respective parties in amounts the court finds equitable, as follows:
(i) against SCB and in favor of any and all dissenters if the court finds
that SCB did not substantially comply with requirements of the Illinois Law
governing dissenters' rights; and (ii) against either the corporation or
a dissenter in favor of any other party if the court finds that the party
against whom fees and expenses are assessed acted arbitrarily, vexatiously,
or not in good faith with respect to the rights provided under the Illinois
Law.

THE FOREGOING SUMMARY DOES NOT PURPORT TO BE A COMPLETE STATEMENT OF
THE PROVISIONS OF THE ILLINOIS LAW RELATING TO THE RIGHTS OF DISSENTING

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SHAREHOLDERS OF SCB, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE
ILLINOIS LAW INCLUDING EXCERPTS THEREOF SET FORTH HEREIN AS APPENDIX B.

EXCHANGE OF SCB STOCK CERTIFICATES; FRACTIONAL SHARES

The conversion of SCB Common into Boatmen's Common (other than any
shares as to which dissenters' rights are properly exercised) will occur
by operation of law at the Effective Time. After the Effective Time,
certificates theretofore evidencing shares of SCB Common (such
certificates, other than certificates held by shareholders exercising their
dissenters' rights, being collectively referred to herein as the "SCB
Certificates") which may be exchanged for shares of Boatmen's Common will
be deemed, for all corporate purposes other than the payment of dividends
and other distributions on such shares, to evidence ownership of and
entitlement to receive such shares of Boatmen's Common.

As soon as reasonably practicable after the Effective Time, Boatmen's
Trust Company (the "Exchange Agent") will mail a transmittal letter and
instructions to each record holder of a SCB Certificate whose shares were
converted into the right to receive the Merger Consideration, advising such
holder of the number of shares of Boatmen's Common such holder is entitled
to receive pursuant to the Merger, of the amount of cash such holder is due
in lieu of a fractional share of Boatmen's Common, and of the procedures
for surrendering such SCB Certificates in exchange for a Certificate for
the number of whole shares of Boatmen's Common, and a check for the cash
amount (if any) such holder is entitled to receive in lieu of fractional
shares. The letter of transmittal will also specify that delivery will be
effected, and risk of loss and title to the SCB Certificates will pass,
only upon proper delivery of the SCB Certificates to the Exchange Agent and
will be in such form and have such other provisions as Boatmen's may
reasonably specify. SHAREHOLDERS OF SCB ARE REQUESTED NOT TO SURRENDER
THEIR SCB CERTIFICATES FOR EXCHANGE UNTIL SUCH LETTER OF TRANSMITTAL AND
INSTRUCTIONS ARE RECEIVED. The shares of Boatmen's Common into which SCB
Common will be converted in the Merger will be deemed to have been issued
at the Effective Time. Unless and until the SCB Certificates are
surrendered, along with a duly executed letter of transmittal, any other
required documents and notification of the holder's federal taxpayer
identification number, dividends on the shares of Boatmen's Common issuable
with respect to such SCB Common, which would otherwise be payable, will not
be paid to the holders of such SCB Certificates and, in such case, upon
surrender of the SCB Certificates, and a duly executed Letter of
Transmittal, any other required documents and notification of taxpayer
identification number, there will be paid any dividends on such shares of
Boatmen's Common which became payable between the Effective Time and the
time of such surrender and notification. No interest on any such dividends
will accrue or be paid.

REPRESENTATIONS AND WARRANTIES OF SCB, BOATMEN'S AND BOATMEN'S-ILLINOIS

The Merger Agreement contains various representations and warranties
of the parties thereto. These include, among other things, representations
and warranties by SCB, except as otherwise disclosed to Boatmen's, as to:
(i) its organization and good standing; (ii) its capitalization; (iii) the
due authorization and execution of the Merger Agreement by SCB; (iv) the
identity and ownership of Community Bank as its sole subsidiary; (v) the
accuracy of its financial statements and Community Bank's filings with the
F.D.I.C.; (vi) the absence of material adverse changes in the financial
condition, results of operations, business or prospects of SCB and
Community Bank; (vii) the absence of certain orders, agreements or
memoranda of understanding between SCB or Community Bank and any federal
or state agency charged with the supervision or regulation of banks or bank
holding companies; (viii) the filing of tax returns and payment of taxes;
(ix) the absence of pending or threatened litigation or other such actions;
(x) agreements with

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employees, including employment agreements; (xi) certain reports required to
be filed with various regulatory agencies; (xii) its loan portfolio; (xiii)
employee matters and ERISA; (xiv) title to its properties, the absence of
liens (except as specified) and insurance matters; (xv) environmental matters;
(xvi) compliance with applicable laws and regulations; (xvii) the absence of
undisclosed liabilities; (xviii) the absence of brokerage commissions or
similar finder's fees in connection with the Merger; and (xix) the accuracy of
information supplied by SCB in connection with the Registration Statement,
this Proxy Statement/Prospectus and any other documents to be filed with the
S.E.C. or any banking or other regulatory authority in connection with the
transactions contemplated by the Merger Agreement.

Boatmen's and Boatmen's-Illinois' representations and warranties
include, among other things, those as to (i) their organization and good
standing; (ii) their capitalization; (iii) the due authorization and
execution of the Merger Agreement by each of Boatmen's and Boatmen's-
Illinois, and the absence of the need (except as specified) for
governmental or third party consents to the Merger; (iv) subsidiaries of
Boatmen's; (v) the accuracy of Boatmen's financial statements and filings
with the S.E.C.; (vi) the absence of material adverse changes in the
financial condition, results of operations or business of Boatmen's and its
subsidiaries; (vii) the absence of material pending or threatened
litigation or other such actions; (viii) certain reports required to be
filed with various regulatory agencies; (ix) compliance with applicable
laws and regulations; and (x) the accuracy of information supplied by
Boatmen's and Boatmen's-Illinois in connection with the Registration
Statement, this Proxy Statement/Prospectus and any other documents to be
filed with the S.E.C. or any banking or other regulatory authority in
connection with the transactions contemplated by the Merger Agreement.

CERTAIN OTHER AGREEMENTS

Business of SCB in Ordinary Course. Pursuant to the Merger Agreement,
----------------------------------
SCB has agreed, among other things, that it will conduct its business and
the business of Community Bank and engage in transactions only in the
usual, regular and ordinary course as previously conducted, and that
neither it nor Community Bank will, without the prior written consent of
Boatmen's (which shall not be unreasonably withheld): (i) issue additional
SCB Common or other capital stock, options, warrants or other rights to
subscribe for or purchase SCB Common, or any other capital stock or any
other securities convertible into or exchangeable for any capital stock of
SCB or Community Bank; (ii) directly or indirectly redeem, purchase or
otherwise acquire SCB Common or any other capital stock of SCB or Community
Bank; (iii) effect a reclassification, recapitalization, splitup, exchange
of shares, readjustment or other similar change in any capital stock or
otherwise reorganize or recapitalize; (iv) change its certificate or
articles of incorporation or association, as the case may be, or bylaws;
(v) grant any increase, other than ordinary and normal increases consistent
with past practices, in the compensation payable or to become payable to
officers or salaried employees, grant any stock options or, except as
required by law, adopt or change any bonus, insurance, pension, or other
employee plan, payment or arrangement made to, for or with any such
officers or employees (provided that SCB and Community Bank may pay their
ordinary officer bonuses and ordinary director bonuses for calendar year
1994 not to exceed in the aggregate the amounts thereof paid in 1993);
(vi) borrow or agree to borrow any material amount of funds other than in
the ordinary course of business or directly or indirectly guarantee or
agree to guarantee any obligations of others; (vii) make or commit to make
any new loan or letter of credit or any new or additional discretionary
advance under any existing line of credit, in excess of $250,000, or that
would increase the aggregate credit outstanding to any one borrower or
group of affiliated borrowers to more than $250,000; (viii) purchase or
otherwise acquire any investment security for its own account having an
average remaining life maturity greater than five years or any asset-backed
securities other than those issued or guaranteed by the Government National
Mortgage Association, the Federal National Mortgage Association or the
Federal Home Loan Mortgage Corporation; (ix) increase

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or decrease the rate of interest paid on time deposits or certificates of
deposit except in accordance with past practices; (x) enter into any
agreement, contract or commitment having a term in excess of three months
other than letters of credit, loan agreements, and other lending, credit and
deposit agreements and documents made in the ordinary course of business; (xi)
mortgage, pledge, subject to lien or charge or otherwise encumber any of its
assets or properties except in the ordinary course of business; (xii) cancel,
accelerate or waive any material indebtedness, claims or rights owing to
SCB or Community Bank except in the ordinary course of business;
(xiii) sell or otherwise dispose of any real property or any material
amount of personal property other than properties acquired in foreclosure
or otherwise in the ordinary collection of indebtedness; (xiv) foreclose
or otherwise take title to or possess any real property, other than single
family, non-agricultural residential property of one acre or less, without
first obtaining a phase one environmental report which indicates that the
property is free of hazardous, toxic or polluting waste materials;
(xv) commit any act or fail to do any act which will result in a material
breach of any agreement, contract or commitment; (xvi) violate any law,
statute, rule, governmental regulation or order, which will adversely
affect the business, financial condition or earnings of SCB and Community
Bank; (xvii) purchase any real or personal property or make any capital
expenditure in excess of $50,000; or (xviii) engage in any transaction or
take any action that would render untrue, in any material respect, any of
the representations and warranties made by SCB in the Merger Agreement, if
such representations or warranties were given as of the date of such
transaction or action.

Subsidiary Bank Merger. Pursuant to the terms of the Merger
----------------------
Agreement, Boatmen's has caused Boatmen's-South Central and SCB has caused
Community Bank to enter into the Subsidiary Merger Agreement which provides
for the Subsidiary Bank Merger. Pursuant to the terms of the Subsidiary
Merger Agreement, at the effective time of the Subsidiary Bank Merger, each
of the issued and outstanding shares of common stock of Community Bank,
$10.00 par value per share (the "Community Bank Common"), other than (i)
shares the holders of which have duly exercised and perfected their
dissenters' rights under applicable Illinois banking law, (ii) shares held
by SCB, and (iii) shares held by directors of Community Bank which are
subject to Director Qualifying Share Agreements, will be converted into the
right to receive cash in the amount of $277.01. In accordance with the
policy of the Illinois Commissioner, Community Bank has obtained an
independent fairness opinion with respect to the fairness of the
consideration to be received by the Community Bank shareholders in exchange
for their shares of Community Bank Common.

Among other things, the Subsidiary Bank Merger is conditioned upon
receipt of applicable regulatory approvals from the F.D.I.C. and the
Illinois Commissioner, and the affirmative vote of at least two-thirds of
the outstanding shares of each of Community Bank and Boatmen's-South
Central. SCB owns a sufficient number of shares of Community Bank Common
(96.37%) to effect the Subsidiary Bank Merger without the affirmative vote
of other shareholders of Community Bank. In the event the Merger Agreement
is terminated, the Subsidiary Merger Agreement shall also be terminated and
the Subsidiary Bank Merger shall be abandoned.

Additional SCB Reserves, Accruals, Charges, and Expenses. The Merger
--------------------------------------------------------
Agreement acknowledges that while SCB believes it has established all
reserves and taken all provisions for possible loan losses required by
generally accepted accounting principles and applicable laws, rules and
regulations, Boatmen's has adopted different loan, accrual and reserve
policies (including different loan classifications and levels of reserves
for possible loan losses). Accordingly, the Merger Agreement provides that
Boatmen's and SCB will consult and cooperate with each other prior to the
Effective Time (i) to conform SCB's loan, accrual

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and reserve policies to those of Boatmen's; (ii) to determine appropriate
accruals, reserves, and charges for SCB to establish and take in respect of
excess equipment write-off or write-down of various assets, and other
appropriate charges and accounting adjustments taking into account the
parties' business plans following the Merger; and (iii) to determine the
amount and the timing for recognizing for financial accounting purposes the
expenses of the Merger and the restructuring charges related to or to be
incurred in connection with the Merger. SCB has agreed to establish and take
all such reserves, accruals, and charges and recognize, for financial
accounting purposes, such expenses and charges, as requested by Boatmen's and
at such times as are mutually agreeable to Boatmen's and SCB, provided,
however, that SCB is not required to take any action which is not consistent
with generally accepted accounting principles.

Environmental Inspections. SCB has provided to Boatmen's a report of
-------------------------
a phase one environmental investigation on certain real property owned or
leased by SCB or Community Bank (which does not include leased space in
retail and similar establishments where the space leased comprises less
than 25% of the total space leased to all tenants of such property and
space leased for automatic teller machines). If required by the phase one
investigation in Boatmen's reasonable opinion, SCB has agreed to provide
a report of a phase two investigation on properties requiring such
additional study. Environmental investigations routinely are conducted by
Boatmen's in connection with transactions involving the acquisition of real
property, whether pursuant to the acquisition of a bank or other business
or in its ongoing business operations. These investigations are intended
to identify and quantify potential environmental risks of ownership, such
as contamination, which could lead to liability for clean-up costs under
the federal Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, and other applicable laws. A "phase
one" investigation is an initial environmental inquiry intended to identify
areas of concern which might require more in-depth assessment. The scope
of a phase one investigation varies depending on the environmental
consultant utilized and the property assessed, but will typically include
(i) visual inspection of the property; (ii) review of governmental records
to ascertain the presence of such things as "Superfund" sites, underground
storage tanks or landfills, etc. on or near the site; (iii) review of all
relevant site records such as air or water discharge permits and hazardous
waste manifests; and (iv) research regarding previous owners and uses of
the property as well as those of surrounding properties. In bank or other
business acquisition transactions, Boatmen's policy is to obtain phase one
environmental investigations of real property to ensure that environmental
problems do not exist which could result in unacceptably high or
unquantifiable risk to Boatmen's and its shareholders.

Other SCB Agreements. SCB has agreed to (i) give Boatmen's prompt
--------------------
written notice of any occurrence, or impending or threatened occurrence,
of any event or condition which would cause or constitute a breach of any
of SCB's representations or agreements in the Merger Agreement or of the
occurrence of any matter or event known to and directly involving SCB (not
including changes in conditions that affect the banking industry generally)
that is materially adverse to the business, operations, properties, assets
or condition (financial or otherwise) of SCB and Community Bank; (ii) use
its best efforts to obtain all necessary consents in any material leases,
licenses, contracts, instruments and rights which require the consent of
another person for their transfer or assumption pursuant to the Merger or
the Subsidiary Bank Merger; (iii) use its best efforts to perform and
fulfill all conditions and obligations to be performed or fulfilled under
the Merger Agreement and to effect the Merger; and (iv) permit Boatmen's
reasonable access to SCB's properties and to disclose and make available
all books, documents, papers and records relating to assets, stock
ownership, properties, operations, obligations and liabilities in which
Boatmen's may have a reasonable and legitimate interest in furtherance of
the transactions contemplated by the Merger Agreement.

Boatmen's Agreements. Pursuant to the Merger Agreement, Boatmen's has
--------------------
agreed, among other things, to (i) file all regulatory applications
required in order to consummate the Merger and the Subsidiary

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Bank Merger and to provide SCB with copies of all such applications; (ii) file
the Registration Statement with the S.E.C. and use its best efforts to cause
the Registration Statement to become effective; (iii) timely file all
documents required to obtain all necessary Blue Sky permits and approvals;
(iv) prepare and file any other filings required to list on Nasdaq the
shares of Boatmen's Common to be issued in the Merger and any other filing
required under the Exchange Act relating to the Merger and related
transactions; (v) promptly notify SCB in writing should Boatmen's have
knowledge of any event or condition which would cause or constitute a
breach of any of its representations or agreements contained in the Merger
Agreement; (vi) use its best efforts to perform and fulfill all conditions
and obligations to be performed or fulfilled under the Merger Agreement and
to effect the Merger; (vii) permit SCB reasonable access to all books,
documents, papers and records relating to the assets, stock ownership,
properties, operations, obligations and liabilities of Boatmen's in which
SCB may have a reasonable and legitimate interest in furtherance of the
transactions contemplated in the Merger Agreement; and (viii) cause
Boatmen's-South Central to enter into the Subsidiary Merger Agreement with
Community Bank and take all other actions and cooperate with Community Bank
in causing the Subsidiary Bank Merger to be effected. In addition, the
Merger Agreement states that Boatmen's shall provide certain employee
benefit plans and programs to the employees of SCB and Community Bank who
continue their employment after the Effective Time.

NO SOLICITATION

The Merger Agreement provides that, unless and until the Merger
Agreement has been terminated, SCB will not solicit or encourage or,
subject to the fiduciary duties of its directors as advised by counsel,
hold discussions or negotiations with, or provide information to, any
person in connection with any proposal from any person relating to the
acquisition of all or a substantial portion of the business, assets or
stock of SCB and Community Bank. SCB is required to promptly advise
Boatmen's of its receipt of, and the substance of, any such proposal or
inquiry.

WAIVER AND AMENDMENT

Prior to or at the Effective Time, any provision of the Merger
Agreement, including, without limitation, the conditions to consummation
of the Merger, may be (i) waived, in writing by the party which is entitled
to the benefits thereof; or (ii) amended at any time by written agreement
of the parties, whether before or after approval of the Merger Agreement
by the shareholders of SCB at the Special Meeting; provided, however, that
after any such approval, no such amendment or modification shall alter the
amount or change the form of the Merger Consideration or alter or change
any of the terms of the Merger Agreement if such alteration or change would
adversely affect the holders of SCB Common. It is anticipated that a
condition to the obligations of SCB and Boatmen's to consummate the Merger
would be waived only in those circumstances where the Board of Directors
of SCB or Boatmen's, as the case may be, deems such waiver to be in the
best interests of such company and its shareholders.

EXPENSES AND FEES

In the event the Merger Agreement is terminated or the Merger is
abandoned, all costs and expenses incurred in connection with the Merger
Agreement will be paid by the party incurring such costs and expenses, and
no party shall have any liability to the other party for costs, expenses,
damages or otherwise, except that, (i) in the event the Merger Agreement
is terminated on account of a willful breach of any of the representations
or warranties therein or any breach of the agreements set forth therein,
the non-breaching

30
37
party is entitled to seek damages against the breaching party; and (ii) in
certain events, SCB will be required to pay a fee of $500,000 to Boatmen's.
See "THE MERGER -- Payment Upon Occurrence of Certain Triggering Events."

FEDERAL INCOME TAX CONSEQUENCES

The Merger is expected to qualify as a reorganization under Section
368(a) of the Code. Except for shareholders perfecting their dissenters'
rights, and cash received in lieu of a fractional share interest in
Boatmen's Common, holders of shares of SCB Common will recognize no gain
or loss on the receipt of Boatmen's Common in the Merger. Additionally,
their aggregate basis in the shares of Boatmen's Common received in the
Merger will be the same as their aggregate basis in their shares of SCB
Common converted in the Merger and, provided the shares surrendered are
held as a capital asset, the holding period of the shares of Boatmen's
Common received by them will include the holding period of their shares of
SCB Common converted in the Merger. Cash received in lieu of fractional
share interests and cash received by shareholders exercising their
dissenters' rights will be treated as a distribution in full payment of
such fractional share interests, or shares surrendered in exercise of
dissenters' rights, resulting in capital gain or loss or ordinary income,
as the case may be, depending upon each shareholder's particular situation.

Consummation of the Merger is conditioned upon receipt by Boatmen's
of an opinion of Lewis, Rice & Fingersh, L.C., counsel to Boatmen's, to the
effect that if the Merger is consummated in accordance with the terms set
forth in the Merger Agreement (i) the Merger will constitute a
reorganization within the meaning of Section 368(a) of the Code; (ii) no
gain or loss will be recognized by the holders of shares of SCB Common upon
receipt of the Merger Consideration (except for cash received in lieu of
fractional shares); (iii) the basis of shares of Boatmen's Common received
by the shareholders of SCB will be the same as the basis of shares of SCB
Common exchanged therefor; (iv) the holding period of the shares of
Boatmen's Common received by such shareholders will include the holding
period of the shares of SCB Common exchanged therefor, provided such shares
were held as capital assets as of the Effective Time; (v) no gain or loss
will be recognized by Boatmen's, SCB or Boatmen's-Illinois as a result of
the Merger; (vi) the basis of the assets of SCB received by Boatmen's-
Illinois will be the same as the basis of such assets in the hands of SCB;
(vii) the holding period of the assets of SCB received by Boatmen's-
Illinois will include the period during which such assets were held by SCB;
and (viii) there will be no federal income tax consequences with respect
to the shareholders of Boatmen's as a result of the Merger. The opinion
of counsel, which will be delivered on the Closing Date, is filed as an
exhibit to the Registration Statement, and the foregoing is only a summary
of such tax consequences.

RESALE OF BOATMEN'S COMMON

The shares of Boatmen's Common issued pursuant to the Merger will be
freely transferable under the Securities Act except for shares issued to
any SCB shareholder who may be deemed to be an "affiliate"

31
38
of SCB or Boatmen's for purposes of Rule 145 under the Securities Act. The
Merger Agreement provides that each such affiliate will enter into an
agreement with Boatmen's providing that such affiliate will not transfer any
shares of Boatmen's Common received in the Merger except in compliance with
the Securities Act. Persons who may be deemed to be affiliates of SCB
generally include individuals who, or entities which, control, are
controlled by or are under common control with SCB. It is anticipated that
all eight director/shareholders of SCB will be deemed affiliates of SCB.
This Proxy Statement/Prospectus does not cover resales of shares of
Boatmen's Common received by any person who may be deemed to be an
affiliate of SCB.

INTERESTS OF CERTAIN PERSONS IN THE MERGER

Certain members of management and the Board of Directors of SCB may
be deemed to have interests in the Merger in addition to their interests
as shareholders of SCB generally. For information about the percentage of
SCB Common owned by the directors and executive officers of SCB, see
"INFORMATION ABOUT SCB -- Security Ownership of Certain Beneficial Owners
and Management of SCB." None of the directors or executive officers of SCB
would own, on a pro forma basis giving effect to the Merger, more than 1%
of the issued and outstanding shares of Boatmen's Common.

Insurance; Indemnification. The Merger Agreement provides that
--------------------------
Boatmen's will provide the directors and officers of SCB and Community
Bank, after the Merger, with the same directors' and officers' liability
insurance coverage that Boatmen's provides to directors and officers of its
other banking subsidiaries generally and, in addition, for a period of
three (3) years will use its best efforts to continue SCB's directors' and
officers' liability insurance coverage with respect to actions occurring
prior to the Effective Time to the extent that such coverage is obtainable
for an aggregate premium not to exceed the annual premium presently being
paid by SCB. If the aggregate premium of such insurance would exceed such
maximum amount, Boatmen's will use its best efforts to procure such level
of insurance having the coverage described herein as can be obtained for
an aggregate premium equal to such maximum amount. The Merger Agreement
also provides that for a period of six (6) years after the Effective Time
Boatmen's will cause Boatmen's-Illinois, as the surviving corporation in
the Merger, or any successor of Boatmen's-Illinois, to indemnify the
present and former directors, officers, employees and agents of SCB and
Community Bank against any liability arising out of actions occurring prior
to the Effective Time, to the extent that such indemnification is then
permitted under the Missouri General Business Corporation Act and by SCB's
Articles of Incorporation as in effect on the date of the Merger Agreement,
including provisions relating to advances of expenses incurred in the
defense of any action or suit.

Montgomery Consulting Agreement. Mr. Robert W. Montgomery, President
-------------------------------
and Chief Executive Officer of SCB and Community Bank ("Montgomery"), and
Boatmen's have entered into an agreement dated September 1, 1994 (the
"Consulting Agreement"), pursuant to which Montgomery will become a
consultant to Boatmen's-South Central upon completion of the Merger. Under
the terms of the Consulting Agreement, Montgomery's responsibilities will
include, with regard to the SCB operations of Boatmen's-South Central,
among other things, retaining existing customers, maintaining positive
community relations as a goodwill ambassador of Boatmen's-South Central
and, as requested, participating in civic and community organizations,
continuing business development and consulting with Boatmen's-South Central
management upon request. Additionally, the Consulting Agreement prohibits
Montgomery from criticizing, impugning or in any way disparaging or
competing against Boatmen's-South Central, Boatmen's or any of its
affiliates, officers, directors or employees. In return for performing his
responsibilities, Montgomery will receive a consulting fee of $4,167 per
month for the first 24 months, and $417 per month for each of

32
39
the remaining months through March 31, 2000, and Montgomery and his spouse
will receive medical insurance coverage as is available to other eligible
Boatmen's-South Central employees and their spouses.

Employee Benefits. The Merger Agreement contains certain provisions
-----------------
regarding employee benefits which are described under "THE MERGER -- Effect
on Employee Benefit Plans."

No member of Boatmen's management or Boatmen's Board of Directors or
any other affiliate of Boatmen's has an interest in the Merger, other than
as a shareholder of Boatmen's generally.

EFFECTIVE TIME

The Merger Agreement provides that the Merger will become effective
upon the filing of a Certificate of Merger with the Secretary of State of
the State of Missouri. It is presently anticipated that the Merger and the
Subsidiary Bank Merger will be consummated contemporaneously in the first
quarter of 1995, but no assurance can be given that such timetable will be
met.

ACCOUNTING TREATMENT

MANAGEMENT AND OPERATIONS AFTER THE MERGER

It is anticipated that, effective as of the Effective Time of the
Merger or thereafter, Community Bank will merge into Boatmen's-South
Central. Boatmen's-South Central will be the surviving bank in the
Subsidiary Bank Merger. Upon consummation of the Subsidiary Bank Merger,
the present offices of Community Bank will be operated as branch offices
of Boatmen's-South Central. It is not anticipated that the management or
Board of Directors of Boatmen's or Boatmen's-Illinois will be affected as
a result of the Merger or the Subsidiary Bank Merger, except that
Mr. Robert W. Montgomery, a director of SCB and Community Bank, will
become a director of Boatmen's-South Central.

EFFECT ON EMPLOYEE BENEFIT PLANS

The Merger Agreement provides that each employee of SCB and Community
Bank who continues as an employee following the Effective Time will be
entitled, as a new employee of a subsidiary of Boatmen's, to participate
in certain employee benefit and stock plans that may be in effect for
employees of all of Boatmen's subsidiaries, from time to time, on the same
basis as similarly situated employees of other Boatmen's subsidiaries,
subject to the right of Boatmen's to amend or terminate any such plans or
programs in its discretion. For purposes of measuring periods of time for
vesting and any age or period of service requirements for commencement of
participation with respect to any employee benefit plans in

33
40
which former employees of SCB and Community Bank may participate, Boatmen's
will credit each such employee with his or her term of service with SCB and
Community Bank.

PRO FORMA FINANCIAL DATA

The following unaudited pro forma combined condensed balance sheet as
of September 30, 1994, and the pro forma combined condensed statements of
income for the nine months ended September 30, 1994 and September 30, 1993,
and for the year ended December 31, 1993, give effect to the Merger based
on the historical consolidated financial statements of Boatmen's and its
subsidiaries and SCB and Community Bank under the assumptions and
adjustments set forth in the accompanying notes to the pro forma financial
statements.

These pro forma statements assume the Merger and Subsidiary Bank
Merger were consummated at the beginning of each period presented. The pro
forma statements may not be indicative of the results that actually would
have occurred if the Merger and the Subsidiary Bank Merger had been in
effect on the dates indicated or which may be obtained in the future. The
pro forma financial statements should be read in conjunction with the
historical consolidated financial statements and notes thereto of Boatmen's
and SCB either incorporated by reference herein or contained elsewhere in
this Proxy Statement/Prospectus. The pro forma financial data give effect
to Boatmen's pending acquisition of Worthen, but does not give effect to
the pending acquisition of other financial institutions, which other
acquisitions are not material to Boatmen's individually or in the
aggregate. If such acquisitions were included as of September 30, 1994,
pro forma equity would be $2,564,858, pro forma net income would be
$304,557 and pro forma earnings per share would be $2.37. See "THE PARTIES
- -- Boatmen's -- Pending Acquisitions."

The following pro forma combined condensed balance sheet and condensed
statements of income include:

(a) Boatmen's historical consolidated before the pending acquisitions
of SCB and Worthen.
(b) Worthen's historical consolidated. The Worthen acquisition will
be accounted for as a pooling of interests and is expected to be
completed in the first quarter of 1995. See "THE PARTIES --
Boatmen's -- Pending Acquisitions." Accordingly, historical
financial data is included for Worthen for all periods presented.
(c) The combined statements of Boatmen's and Worthen for the periods
described above have been designated herein as Boatmen's Pro
Forma.
(d) SCB historical consolidated.
(e) The combined statements of Boatmen's, Worthen and SCB
consolidated have been designated herein as Pro Forma Combined.

34
41

PRO FORMA COMBINED CONDENSED BALANCE SHEET
(Unaudited)
September 30, 1994
(In Thousands)

(b)
(a) WORTHEN (c) (d) (e)
BOATMEN'S BANKING BOATMEN'S SALEM COMMUNITY PRO FORMA
BANCSHARES, INC. CORPORATION PRO FORMA BANCORP, INC. ADJUSTMENTS COMBINED
---------------- ----------- --------- ------------- ----------- --------

ASSETS:
Cash and noninterest-bearing
balances due from banks $1,767,030 $185,393 $1,952,423 $3,061 ($8,083) <F2> $1,947,401
Short term investments 45,604 948 46,552 385 46,937
Securities
Held to Maturity 4,200,436 1,073,127 5,273,563 7,739 5,281,302
Available for Sale 4,107,319 140,906 4,248,225 12,685 4,260,910
Trading 25,600 25,600 25,600
Federal funds sold and securities
purchased under resale agreements 775,293 79,500 854,793 2,625 857,418
Loans, net of unearned 16,104,659 1,899,391 18,004,050 50,821 18,054,871
Less reserve for loan losses 347,060 33,483 380,543 678 381,221
-----------------------------------------------------------------------------------------------
Loans, net 15,757,599 1,865,908 17,623,507 50,143 17,673,650
-----------------------------------------------------------------------------------------------
Property and equipment 519,609 96,326 615,935 1,545 617,480
Intangibles 260,372 27,281 287,653 219 3,569 <F3> 291,441
Other assets 833,135 54,366 887,501 776 888,277
-----------------------------------------------------------------------------------------------
Total Assets $28,291,997 $3,523,755 $31,815,752 $79,178 ($4,514) $31,890,416
===============================================================================================

LIABILITIES AND EQUITY:
Noninterest-bearing deposits $ 4,318,661 $583,997 $4,902,658 $ 9,330 $ 4,911,988
Interest-bearing deposits 16,165,655 2,377,077 18,542,732 62,943 18,605,675
-----------------------------------------------------------------------------------------------
Total deposits 20,484,316 2,961,074 23,445,390 72,273 23,517,663
-----------------------------------------------------------------------------------------------
Federal funds purchased and
other short-term borrowings 4,722,198 187,786 4,909,984 1,700 4,911,684
Long-term debt 515,428 43,030 558,458 558,458
Capital lease obligation 38,575 1,794 40,369 40,369
Other liabilities 323,503 28,337 351,840 691 352,531
-----------------------------------------------------------------------------------------------
Total liabilities 26,084,020 3,222,021 29,306,041 74,664 29,380,705
-----------------------------------------------------------------------------------------------
Redeemable preferred stock 1,142 1,142 1,142

Stockholders' equity:
Common stock 104,789 17,346 <F1> 122,135 8 (8) <F3> 122,135
Surplus 795,776 164,149 <F1> 959,925 766 (766) <F3> 959,925
Retained earnings 1,362,914 123,318 1,486,232 3,911 (3,911) <F3> 1,486,232
Less Treasury stock (8,083) <F2>
8,083 <F3>
Unrealized net depreciation,
available for sale securities (56,644) (3,079) (59,723) (171) 171 <F3> (59,723)
-----------------------------------------------------------------------------------------------
Total stockholders' equity 2,206,835 301,734 2,508,569 4,514 (4,514) 2,508,569
-----------------------------------------------------------------------------------------------
Total liabilities and
stockholders' equity $28,291,997 $3,523,755 $31,815,752 $79,178 ($4,514) $31,890,416
===============================================================================================
Stockholders' equity per share $21.06 $20.54 $20.54
=============== ============= ==============

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42
NOTES TO PRO FORMA CONDENSED BALANCE SHEET

<F1> Based on the exchange ratio of 1.0 share of Boatmen's Common
for each share of Worthen common stock, including stock
options, 17,345,566 additional shares of Boatmen's Common
would have been issued as of September 30, 1994, in the
acquisition of Worthen.

<F2> Reflects purchase of treasury shares by Boatmen's to be used
in the acquisition of SCB.

<F3> Reflects conversion of outstanding shares of SCB Common using
the exchange ratio of 37.57 shares of Boatmen's Common for
each outstanding share of SCB for a purchase price of
$8.1 million in shares to be issued from treasury shares
(288,688 at $28 per share), and recognition of goodwill.

<F4> It is anticipated that Worthen will record nonrecurring
charges in the first quarter of 1995 upon consummation of the
Worthen merger. Boatmen's estimates the total of such charges
will approximate $13 million on a pre-tax basis, or a
reduction of $0.08 in earnings per share for the quarter.
Accordingly, the effect of such charges is not reflected in
the pro forma financial statements as it is immaterial.

<F5> Interest rates increased steadily in 1994 which has increased
the importance of managing interest rate risk associated with
on-balance sheet and derivatives instruments. The overall
increase in interest rates is reflected in the prime rate
which increased from 6.0% at December 31, 1993 to the current
level of 8.5%. Based on the current interest rate outlook and
the asset/liability repricing structure, Boatmen's anticipates
relative stability in the net interest margin in the near
term.

Boatmen's interest rate risk policy is to maintain a stable
level of net interest income while also enhancing earnings
potential through limited risk positioning based on the
forecast of future interest rates. Interest rate risk
exposure is limited, by policy, to 5% of projected annual net
income. Adherence to these risk limits is controlled and
monitored through simulation modeling techniques that consider
the impact that alternative interest rate scenarios will have
on Boatmen's financial results.

An effective asset/liability management function is
necessitated by the interest rate risk inherent in Boatmen's
core banking activities. If no other action is taken, the
behavior of the core banking activity, which includes lending
and deposit activity, results in an asset-sensitive position.
Accordingly, to prudently manage the overall interest rate
sensitivity position, Boatmen's utilizes a combination of
interest rate swaps and on-balance sheet financial instruments
to reduce the natural asset sensitivity of the core banking
activities.

The interest rate swap portfolio is currently being used to
modify the interest rate sensitivity of subordinated debt and
to alter the interest rate sensitivity of Boatmen's prime-
based loan portfolio. Boatmen's has accessed the capital
markets twice in recent years resulting in the issuance of
$200 million of fixed rate subordinated debt. The impact of
adding long-term debt to the balance sheet resulted in a
movement towards being more asset sensitive as proceeds were
initially used to replace short-term borrowings. Accordingly,
to reduce the impact on Boatmen's gap position, $200 million
of interest rate swaps were executed to convert fixed rate
debt to a floating rate instrument. Boatmen's prime based
loan portfolio (approximately $5.5 billion) is the primary
cause of the large asset sensitivity position of the core
banking activity as it is primarily funded by deposit
liabilities that are less sensitive to movements in market
interest rates. As a means to alter the interest rate
sensitivity of the prime based portfolio, Boatmen's has used
off-balance sheet instruments to convert approximately
$2.0 billion of prime based loans to fixed rate instruments.
Periodic correlation assessments are performed to ensure that
the swap instruments are effectively modifying the interest
rate characteristics of the prime based loans and long-term
debt. The interest rate swaps are not leveraged in that they
reset in step with rate movements within the underlying index.
Both interest swap programs were consistent with management's
objective of reducing the natural asset sensitivity of the
core banking activities.

In 1994, Boatmen's added new swap transactions with a notional
amount of $1.1 billion and $0.6 billion of swaps matured, such
that at September 30, 1994, interest rate swaps totaled
$2.3 billion. The swap portfolio increased net

36
43
interest income by approximately $16.3 million for the nine months of
1994, adding 9 basis points to the net interest margin, compared to
$14.0 million or 9 basis points in the same period last year. The
swap portfolio is primarily comprised of contracts wherein Boatmen's
receives a fixed rate of interest while paying a variable rate. The
average rate received at September 30, 1994 was 5.46% compared to an
average rate paid of 5.14%, and the average remaining maturity of the
total portfolio was less than two years. The estimated fair value
of the swap portfolio was a negative $123 million at September 30,
1994, based on discounted cash flow models. Given that these swaps are
valued using interest rates at quarter end, the estimated fair value
is not necessarily indicative of the future net interest potential of
the portfolio over its remaining life. Approximately 90% of the
portfolio is comprised of indexed amortizing swaps;
accordingly, the maturity distribution could lengthen if
interest rates were to increase from current levels. Assuming
short-term interest rates were to increase 200 basis points
from their current levels, the average maturity distribution
of the swap portfolio would increase from 2 years to
approximately 4 years. In addition, the results from the
simulation model indicate that in a rising rate environment
the net interest contribution from the swap portfolio will
lessen as the variable component resets upward, but this
should be offset by a higher contribution from core banking
activities. The increased contribution from core banking
activities will occur as variable rate loans reprice upward
coupled with an increased contribution from administered rate
liabilities, which are less sensitive to rate movements.

While Boatmen's is primarily an end-user of derivative
instruments, it does serve in a limited capacity as an
intermediary to meet the financial needs of its customers.
The notional amount of the customer swap portfolio at
September 30, 1994 totaled approximately $169 million.
Interest rate risk associated with this portfolio is
controlled by entering into offsetting positions with third
parties.

Any future utilization of off-balance sheet financial
instruments will be determined based upon Boatmen's overall
interest rate sensitivity position and asset/liability
management strategies, which are designed to limit interest
rate risk exposure (earnings at risk position) to no more than
5% of projected annual net income. Based on the current
interest rate sensitivity position, and assuming a gradual
100-200 basis point increase in interest rates over the next
12 months, the simulation model results indicate that
Boatmen's earnings at risk position is within established
limits.

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44

PRO FORMA COMBINED CONDENSED STATEMENT OF INCOME
(UNAUDITED)

NINE MONTHS ENDED SEPTEMBER 30, 1994
(IN THOUSANDS, EXCEPT PER SHARE DATA)

WORTHEN SALEM
BOATMEN'S BANKING BOATMEN'S COMMUNITY PRO FORMA
BANCSHARES, INC. CORPORATION PRO FORMA BANCORP, INC. COMBINED
---------------- ----------- --------- ------------- --------

Interest Income $1,292,115 $162,142 $1,454,257 $3,945 $1,458,202
Interest Expense 528,363 56,197 584,560 1,670 586,230
-----------------------------------------------------------------------------
Net Interest Income 763,752 105,945 869,697 2,275 871,972
Provision for loan losses 19,906 1,050 20,956 70 21,026
-----------------------------------------------------------------------------
Net Interest Income after
provision for loan losses 743,846 104,895 848,741 2,205 850,946

Noninterest income 390,535 50,584 441,119 400 441,519
Noninterest expense 732,282 99,831 832,113 1,884 833,997
-----------------------------------------------------------------------------
Income before income taxes 402,099 55,648 457,747 721 458,468
Income tax expense 138,775 20,099 158,874 257 159,131
-----------------------------------------------------------------------------
Net income $263,324 $35,549 $298,873 $464 $299,337
=============================================================================
Net income available to
common shareholders $263,264 $35,549 $298,813 $464 $299,277
=============================================================================
Net income per common share $2.52 $2.46 $2.46
================= =============== ===============
Average shares outstanding 104,673 121,693 121,693
================= =============== ===============

See Notes to Pro Forma Combined Condensed Statements of Income

38
45

PRO FORMA COMBINED CONDENSED STATEMENT OF INCOME
(UNAUDITED)

NINE MONTHS ENDED SEPTEMBER 30, 1993
(IN THOUSANDS, EXCEPT PER SHARE DATA)

WORTHEN SALEM
BOATMEN'S BANKING BOATMEN'S COMMUNITY PRO FORMA
BANCSHARES, INC. CORPORATION PRO FORMA BANCORP, INC. COMBINED
---------------- ----------- --------- ------------- --------

Interest Income $1,201,695 $158,292 $1,359,987 $3,899 $1,363,886
Interest Expense 473,848 60,056 533,904 1,718 535,622
-----------------------------------------------------------------------------
Net Interest Income 727,847 98,236 826,083 2,181 828,264
Provision for loan losses 48,331 3,779 52,110 90 52,200
-----------------------------------------------------------------------------
Net Interest Income after
provision for loan losses 679,516 94,457 773,973 2,091 776,064

Noninterest income 366,389 51,479 417,868 357 418,225
Noninterest expense 696,620 111,730 808,350 1,743 810,093
-----------------------------------------------------------------------------
Income before income taxes 349,285 34,206 383,491 705 384,196
Income tax expense 108,988 11,258 120,246 243 120,489
-----------------------------------------------------------------------------
Net income $240,297 $22,948 $263,245 $462 $263,707
=============================================================================
Net income available to
common shareholders $240,233 $22,948 $263,181 $462 $263,643
=============================================================================
Net income per common share $2.32 $2.19 $2.19
================= =============== ===============
Average shares outstanding 103,415 120,170 120,170
================= =============== ===============

See Notes to Pro Forma Combined Condensed Statements of Income

39
46

PRO FORMA COMBINED CONDENSED STATEMENT OF INCOME
(UNAUDITED)

YEAR ENDED DECEMBER 31, 1993
(IN THOUSANDS, EXCEPT PER SHARE DATA)

WORTHEN SALEM
BOATMEN'S BANKING BOATMEN'S COMMUNITY PRO FORMA
BANCSHARES, INC. CORPORATION PRO FORMA BANCORP, INC. COMBINED
---------------- ----------- --------- ------------- --------

Interest Income $1,613,554 $212,082 $1,825,636 $5,231 $1,830,867
Interest Expense 631,974 79,264 711,238 2,275 713,513
-----------------------------------------------------------------------------
Net Interest Income 981,580 132,818 1,114,398 2,956 1,117,354
Provision for loan losses 60,184 4,628 64,812 110 64,922
-----------------------------------------------------------------------------
Net Interest Income after
provision for loan losses 921,396 128,190 1,049,586 2,846 1,052,432

Noninterest income 493,251 66,591 559,842 499 560,341
Noninterest expense 950,421 147,199 1,097,620 2,437 1,100,057
-----------------------------------------------------------------------------
Income before income taxes 464,226 47,582 511,808 908 512,716
Income tax expense 146,807 15,332 162,139 309 162,448
-----------------------------------------------------------------------------
Net income $317,419 $32,250 $349,669 $599 $350,268
=============================================================================
Net income available to
common shareholders $317,334 $32,250 $349,584 $599 $350,183
=============================================================================
Net income per common share $3.07 $2.91 $2.91
================= =============== ===============
Average shares outstanding 103,490 120,307 120,307
================= =============== ===============

See Notes to Pro Forma Combined Condensed Statements of Income

40
47

NOTES TO PRO FORMA COMBINED CONDENSED STATEMENTS OF INCOME
(Unaudited)

1. The change in average shares outstanding shown in the pro
forma analysis reflects the issuance of 1.0 shares of
Boatmen's Common for each share of Worthen Banking Corporation
common stock. Approximately 288,700 shares of Boatmen's
Common will be issued in the acquisition of SCB, however, a
similar number of shares have been acquired as treasury stock by
Boatmen's resulting in no net increase in shares outstanding
related to the SCB acquisition.

2. Net income includes $868 thousand for the nine months ended
September 30, 1993 and year ended December 31, 1993, for the
cumulative effect of FAS No. 109 adoption at Worthen. In
addition, net income reflects the amortization of $3.6 million
in goodwill which would result from the purchase acquisition
of SCB and would be amortized over 15 years.

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48

DESCRIPTION OF BOATMEN'S CAPITAL STOCK

Boatmen's Restated Articles of Incorporation currently
authorize the issuance of 150,000,000 shares of common stock,
par value $1.00 per share, and 10,300,000 preferred shares, no par
value per share, of which 35,045 shares are designated "7%
Cumulative Redeemable Preferred Stock, Series B", $100.00 stated
value per share (the "Boatmen's Series B Preferred Stock"), and
1,500,000 shares are designated "Junior Participating Preferred
Stock, Series C", $1.00 stated value per share (the "Boatmen's
Series C Preferred Stock").

As of December 31, 1994, approximately 104.8 million shares of
Boatmen's Common were issued and outstanding, 11,421 shares of
Boatmen's Series B Preferred Stock were issued and outstanding, and
1,500,000 shares of Boatmen's Series C Preferred Stock were
reserved for issuance with no shares outstanding.

With respect to the remaining authorized but unissued
preferred shares, Boatmen's Restated Articles of Incorporation
provide that its Board of Directors may, by resolution, cause such
preferred shares to be issued from time to time, in series, and fix
the powers, designations, preferences and relative, participating
optional and other rights and qualifications, limitations and
restrictions of such shares.

The following is a brief description of the terms of Boatmen's
Common and Boatmen's Series B Preferred Stock. For a discussion of
the terms of Boatmen's Series C Preferred Stock, see "COMPARISON OF
SHAREHOLDER RIGHTS -- Shareholder Rights Plan."

BOATMEN'S COMMON

Dividend Rights. The holders of Boatmen's Common are entitled
---------------
to share ratably in dividends when, as and if declared by the Board
of Directors of Boatmen's from funds legally available therefor,
after full cumulative dividends have been paid, or declared and
funds sufficient for the payment thereof set apart, on all shares
of Boatmen's Series B Preferred Stock, and any other class or
series of preferred stock ranking superior as to dividends to
Boatmen's Common. The ability of the subsidiary banks of Boatmen's
to pay cash dividends, which are expected to be Boatmen's principal
source of income, is restricted by applicable banking laws.

Voting Rights. Each holder of Boatmen's Common has one vote
-------------
for each share held on matters presented for consideration by the
shareholders, except that, in the election of directors, such
shareholders have cumulative voting rights which entitle each such
shareholder to the number of votes which equals the number of
shares held by the shareholder multiplied by the number of
directors to be elected. All such cumulative votes may be cast for
one candidate for election as a director or may be distributed
among two or more candidates.

Classification of Board of Directors. The Board of Directors
------------------------------------
of Boatmen's is divided into three classes, and the directors are
elected by classes to three-year terms, so that approximately one-
third (1/3) of the directors of Boatmen's will be elected at each
annual meeting of the shareholders. Although it promotes stability
and continuity of the Board of Directors, classification of the
Board of Directors may have the effect of decreasing the number of
directors that could otherwise be elected by anyone who obtains a
controlling interest in Boatmen's Common and thereby could impede
a change in control of Boatmen's. Because fewer directors will be
elected at each annual meeting, such classification also will
reduce the effectiveness of cumulative voting as a means of
establishing or increasing minority representation on the Board of
Directors.

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Preemptive Rights. The holders of Boatmen's Common have no
-----------------
preemptive right to acquire any additional unissued shares or
treasury shares of Boatmen's Common.

Liquidation Rights. In the event of liquidation, dissolution
------------------
or winding up of Boatmen's, whether voluntary or involuntary, the
holders of Boatmen's Common will be entitled to share ratably in
any of its assets or funds that are available for distribution to
its shareholders after the satisfaction of its liabilities (or
after adequate provision is made therefor) and after preferences on
any outstanding preferred stock.

Assessment and Redemption. Shares of Boatmen's Common will
-------------------------
be, when issued, fully paid and non-assessable. Except with
respect to the attached preferred share purchase rights, such
shares of Boatmen's Common do not have any redemption provisions.
See, "COMPARISON OF SHAREHOLDER RIGHTS -- Shareholder Rights Plan."

BOATMEN'S SERIES B PREFERRED STOCK

Dividend Rights. Holders of shares of Series B Preferred
---------------
Stock will be entitled to receive, when and as declared by the
Board of Directors, out of any funds legally available for such
purpose, cumulative cash dividends at an annual dividend rate per
share of seven percent (7%) of the stated value thereof, payable
quarterly. Dividends on Boatmen's Series B Preferred Stock are
cumulative and no dividends can be declared or paid on any shares
of Boatmen's Common unless full cumulative dividends on Boatmen's
Series B Preferred Stock have been paid, or declared and funds
sufficient for the payment thereof set apart.

Liquidation Rights. In the event of the dissolution and
------------------
liquidation of Boatmen's, the holders of Boatmen's Series B
Preferred Stock will be entitled to receive, after payment of the
full liquidation preference on shares of any class or series of
preferred stock ranking superior to Boatmen's Series B Preferred
Stock (if any such shares are then outstanding) but before any
distribution on shares of Boatmen's Common, liquidating dividends
of $100.00 per share plus accumulated dividends.

Redemption. Shares of Boatmen's Series B Preferred Stock are
----------
redeemable, at the option of the holders thereof, at the redemption
price of $100.00 per share plus accumulated dividends, provided,
that (i) full cumulative dividends have been paid, or declared and
funds sufficient for payment set apart, upon any class or series of
preferred stock ranking superior to Boatmen's Series B Preferred
Stock; and (ii) Boatmen's is not then in default with respect to
any sinking or analogous fund or call for tenders obligation or
agreement for the purchase or any class or series of preferred
stock ranking superior to Boatmen's Series B Preferred Stock.

Voting Rights. Each share of Boatmen's Series B Preferred
-------------
Stock has equal voting rights, share for share, with each share of
Boatmen's Common.

Superior Stock. Boatmen's may, without the consent of holders
--------------
of Boatmen's Series B Preferred Stock, issue preferred stock with
superior or equal rights or preferences.

COMPARISON OF SHAREHOLDER RIGHTS

The rights of holders of shares of Boatmen's Common are
governed by The General and Business Corporation Law of Missouri
(the "Missouri Law"), the state of Boatmen's incorporation, and by
Boatmen's Restated Articles of Incorporation, Bylaws and other
corporate documents. The rights of holders of shares of SCB Common
are governed by the Illinois Law and by SCB's Articles of
Incorporation, Bylaws and other corporate documents. The rights of
holders of shares of SCB Common differ in certain respects from the
rights which they would have as shareholders of Boatmen's. A
summary of the material differences between the respective rights
of holders of SCB Common and Boatmen's Common is set forth herein.

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SHAREHOLDER VOTE REQUIRED FOR CERTAIN TRANSACTIONS

Business Combinations. Boatmen's Restated Articles of
---------------------
Incorporation provide that, in addition to any affirmative vote
required by law, any "Business Combination" (as defined herein)
will require the affirmative vote of the holders of not less than
eighty percent (80%) of Boatmen's Common. Notwithstanding the
foregoing, however, Boatmen's Restated Articles of Incorporation
also provide that any such Business Combination may be approved by
the affirmative vote of shareholders as required by law if it has
been approved by seventy-five percent (75%) of the entire Board of
Directors of Boatmen's. The term "Business Combination" means
(i) any merger or consolidation of Boatmen's or any subsidiary of
Boatmen's with (a) any individual or entity who, together with
certain affiliates or associates, owns greater than five percent
(5%) of Boatmen's Common (a "Substantial Shareholder"); or (b) any
other corporation which, after such merger or consolidation, would
be a Substantial Shareholder, regardless of which entity survives;
(ii) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of transactions) to or
with any Substantial Shareholder of all or substantially all of the
assets of Boatmen's or any of its subsidiaries; (iii) the adoption
of any plan or proposal for the liquidation of Boatmen's by or on
behalf of a Substantial Shareholder; or (iv) any transaction
involving Boatmen's or any of its subsidiaries, if the transaction
would have the effect, directly or indirectly, of increasing the
proportionate share of the outstanding shares of any class of
equity or convertible securities of Boatmen's of which a
Substantial Shareholder is the beneficial owner.

The Illinois Law provides that any merger, consolidation or
exchange of an Illinois corporation will be approved upon receipt
of the affirmative vote of the holders of at least two-thirds (2/3)
of the outstanding shares entitled to vote on such a plan, unless
any class or series of shares of any such corporation is entitled
to vote as a class on the plan in which event, the plan of merger,
consolidation or exchange will be approved upon receiving the
affirmative vote of holders of at least two-thirds (2/3) of the
outstanding shares of such class or series entitled to vote as a
class on the plan and of the total outstanding shares entitled to
vote on the plan. The articles of incorporation of any corporation
may supersede the two-thirds (2/3) vote requirement by specifying
a smaller or larger vote requirement but not less than the majority
of the outstanding shares entitled to vote on the issue and not
less than a majority of the outstanding shares of each class or
series of shares entitled to vote as a class on the issue. In
other specified situations, Illinois Law requires a higher vote for
certain business combinations as more fully set forth herein. See
"COMPARISON OF SHAREHOLDER RIGHTS -- Takeover Statutes."

SCB's Articles of Incorporation do not contain a provision
setting forth a voting requirement for business combinations.
SCB's Bylaws provide that a majority of outstanding shares entitled
to vote at any meeting of the shareholders constitutes a quorum,
and the affirmative vote of the majority of the shares represented
at the meeting will be the act of the shareholders unless a greater
number or voting by class is required by law or by SCB's Articles
of Incorporation or Bylaws.

Removal of Directors. Boatmen's Restated Articles of
--------------------
Incorporation and Bylaws provide that, at a meeting called
expressly for that purpose, a director or the entire Board of
Directors may be removed without cause only upon the affirmative
vote of the holders of not less than eighty percent (80%) of the
shares entitled to vote generally in an election of directors.
Notwithstanding the foregoing, however, if less than the entire
Board of Directors is to be removed without cause, no one of the
directors may be removed if the votes cast against his or her
removal would be sufficient to elect him or her if then
cumulatively voted at an election of the class of directors of
which he or she is a part. At a meeting called expressly for that
purpose, a director may be removed by the shareholders for cause by
the affirmative vote of the holders of a majority of the shares
entitled to vote upon his or her election.

The Illinois Law provides that directors of SCB may be removed
with or without cause at a meeting of the shareholders called
expressly for that purpose by a vote of the holders of a majority
of the shares

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51
entitled to vote in an election of directors; provided, however, that no
directors may be removed at a meeting of the shareholders unless notice of
the meeting states that the purpose is to vote upon the removal of the
directors named in the notice. If less than the entire board is removed,
no one of the directors may be removed if the votes cast against the
removal would be sufficient to elect a director if then cumulatively voted
at an election of the entire board of directors. If a director is elected
by a class of shares, he or she may be removed only by shareholders of that
class.

SCB's Articles of Incorporation do not contain a provision
regarding the removal of directors. SCB's Bylaws provide for
removal of directors in substantially the same manner as the
Illinois Law.

Amendments to Articles of Incorporation. Under the Missouri
---------------------------------------
Law, a corporation may amend its articles of incorporation upon
receiving the affirmative vote of the holders of a majority of its
voting shares; provided, however, that if the corporation's
articles of incorporation or bylaws provide for cumulative voting
in the election of directors, the number of directors of the
corporation may not be decreased to less than three by amendment to
the corporation's articles of incorporation when the number of
shares voting against the proposal for decrease would be sufficient
to elect a director if the shares were voted cumulatively at an
election of three directors; and provided, further, that a proposed
amendment which provides that Section 351.407 of the Missouri Law
does not apply to "control share acquisitions" of shares of a
corporation requires the affirmative vote of the holders of two-
thirds (2/3) of such corporation's voting shares. See "COMPARISON
OF SHAREHOLDER RIGHTS -- Takeover Statutes."

Article XII of Boatmen's Restated Articles of Incorporation
provides that Boatmen's may amend, alter, change or repeal
provisions of the Restated Articles of Incorporation in the manner
provided by law, with the exception, however, of amendments to
those provisions of the Restated Articles relating to the
classification and number of directors, the approval of Business
Combinations, and the aforementioned exceptions set forth in
Article XII, which require the affirmative vote of the holders of
eighty percent (80%) of Boatmen's Common then entitled to vote at
a meeting of shareholders called for that purpose.

For certain limited purposes, a majority of the whole board of
directors of an Illinois corporation may adopt amendments to its
articles of incorporation without shareholder action. However,
generally, a proposed amendment to the articles of incorporation
requires the affirmative vote of the holders of at least two-thirds
of the outstanding shares entitled to vote on such amendment,
unless any class or series of shares is entitled to vote as a class
in respect thereof, in which event the proposed amendment is
adopted upon receiving the affirmative vote of the holders of at
least two-thirds (2/3) of the outstanding shares of each class or
series of shares entitled to vote as a class in respect thereof and
of the total outstanding shares entitled to vote on such amendment.
The articles of incorporation of an Illinois corporation may
supersede the two-thirds (2/3) vote requirement by specifying a
smaller or larger vote requirement not less than the majority of
the outstanding shares entitled to vote on the amendment and not
less than a majority of the outstanding shares of each class or
series of shares entitled to vote as a class on the amendment.
SCB's Articles of Incorporation do not contain a provision
regarding amending the Articles of Incorporation.

VOTING RIGHTS

Under the Missouri Law, unless otherwise provided in the
articles of incorporation, each outstanding share is entitled to
one vote on each matter submitted to a vote at a meeting of the
shareholders. However, the Missouri Law provides that, unless the
articles of incorporation provide otherwise, each shareholder is
entitled to cumulative voting when electing directors, which means
that each shareholder has the right to cast as many votes in the
aggregate equal to the number of votes held by such person
multiplied by the number of directors to be elected at the
election, and the person may cast the whole number of votes for one
candidate or distribute them in any manner he or she desires.

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52

Boatmen's Bylaws provide that at all meetings of the
shareholders, unless otherwise provided in the Bylaws or Articles
of Incorporation, each share is entitled to one vote in each matter
submitted to a vote, but no share belonging to or hypothecated to
Boatmen's shall be voted. Additionally, Boatmen's Bylaws provide
for cumulative voting with regard to the election of directors.

Under the Illinois Law, a holder of each outstanding share of
an Illinois corporation is entitled to one vote in each matter
submitted to the shareholders, with certain limited exceptions, and
is entitled to cumulative voting when electing directors.
Additionally, the articles of incorporation of an Illinois
corporation incorporated after December 31, 1981 may limit or
eliminate cumulative voting rights in all or in specified
circumstances.

SCB's Bylaws provide that the holder of each outstanding share
of SCB Common is entitled to one vote on each matter submitted to
a vote at any meeting of the shareholders and provides for
cumulative voting for directors. SCB's Bylaws also provide that
the act of a majority of a quorum generally constitutes a valid
corporate act; however, shares of its own stock belonging to SCB
are not counted in determining the total number of outstanding
shares.

SPECIAL MEETINGS OF SHAREHOLDERS; SHAREHOLDER ACTION BY WRITTEN
CONSENT

The Missouri Law provides that any action required or
permitted to be taken at a meeting of shareholders may be taken
without a meeting if a consent, in writing, setting forth the
action taken is signed by the holders of all of the shares entitled
to vote on the subject matter. Boatmen's Bylaws provide that a
special meeting of shareholders may be called by the Chairman of
the Board or the President or by resolution of the Board of
Directors whenever deemed necessary. The business transacted at
any such special meeting will be confined to the purpose or
purposes specified in the notice therefor and the matters germane
thereto.

The Illinois Law provides that special meetings of the
shareholders of SCB may be called by the President, by the Board of
Directors, by the holders of not less than one-fifth (1/5) of all
shares entitled to vote on the matter for which the meeting is
called or by such officer or persons as may be provided in the
articles of incorporation or the bylaws. Pursuant to the Illinois
Law, unless otherwise provided in the articles of incorporation or
with respect to voluntary dissolution, any action required to be
taken at a meeting of the shareholders, or any other action which
may be taken at a meeting of shareholders, may be taken without a
meeting if a consent in writing, setting forth the action so taken,
is signed by (i) the holders of outstanding shares having not less
than the minimum number of votes that would be necessary to
authorize or take such action at a meeting at which all shares
entitled to vote thereon were present and voting or (ii) all of the
shareholders entitled to vote with respect to the subject matter.
If such consent is signed by less than all of the shareholders
entitled to vote, then such consent will become effective only if:
(i) at least five days prior to the execution of the consent a
notice in writing is delivered to all the shareholders entitled to
vote with respect to the subject matter thereof; and (ii) after the
effective date of the consent, prompt notice of the taking of the
action without a meeting by less than unanimous written consent is
delivered in writing to those shareholders who did not consent in
writing.

SCB's Bylaws provide that special meetings of the shareholders
may be called by the Chairman of the Board, the President, the
Board of Directors or the holders of not less than one-fifth (1/5)
of all the outstanding shares entitled to vote at the meeting.
Additionally, SCB's Bylaws provide for actions to be taken without
a meeting in substantially the same manner as the Illinois Law
provides.

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53

NOTICE OF SHAREHOLDER NOMINATIONS OF DIRECTORS

Boatmen's Bylaws provide that a shareholder may nominate a
person for director only if he delivers notice of such nomination
to the Secretary of Boatmen's, accompanied or promptly followed by
such supporting information as the Secretary of Boatmen's shall
reasonably request, not less than 75 days prior to the date of any
annual meeting or more than seven days after the mailing of notice
of any special meeting.

Neither SCB's Articles of Incorporation nor Bylaws contain a
similar provision.

SHAREHOLDER PROPOSAL PROCEDURES

Boatmen's Bylaws provide that in order for any business to be
transacted at any meeting of the shareholders, other than business
proposed by or at the direction of the Board of Directors, notice
thereof must be received from the proposing shareholder by the
Secretary of Boatmen's, accompanied or promptly followed by such
supporting information as the Secretary of Boatmen's shall
reasonably request, not less than 75 days prior to the date of any
annual meeting or more than seven days after the mailing of notice
of any special meeting.

Neither SCB's Articles of Incorporation nor Bylaws contain a
similar provision.

SHAREHOLDER RIGHTS PLAN

Overview. Boatmen's has adopted a shareholder rights plan
--------
pursuant to which holders of a share of Boatmen's Common also hold
one preferred share purchase right which may be exercised upon the
occurrence of certain "triggering events" specified in Boatmen's
shareholder rights plan. Neither SCB nor Community Bank has a
shareholder rights plan. Shareholder rights plans, such as
Boatmen's plan, are intended to encourage potential hostile
acquirors of a "target" corporation to negotiate with the board of
directors of the target corporation in order to avoid occurrence of
the "triggering events" specified in such plans. Shareholder
rights plans are intended to give the directors of a target
corporation the opportunity to assess the fairness and
appropriateness of a proposed transaction in order to determine
whether or not it is in the best interests of the corporation and
its shareholders. Notwithstanding these purposes and intentions of
shareholder rights plans, such plans, including that of Boatmen's,
could have the effect of discouraging a business combination which
shareholders believe to be in their best interests. The provisions
of the shareholder rights plan of Boatmen's are discussed herein.

On August 14, 1990, the Board of Directors of Boatmen's
declared a dividend, payable on August 31, 1990 (the "Boatmen's
Record Date"), of one Preferred Share Purchase Right (a "Boatmen's
Right") for each outstanding share of Boatmen's Common. Each
Boatmen's Right entitles the registered holder to purchase from
Boatmen's one one-hundredth share of Boatmen's Series C Preferred
Stock at a price of $110.00 per one one-hundredth share of
Boatmen's Series C Preferred Stock (the "Boatmen's Purchase
Price"), subject to adjustment. The description and terms of the
Boatmen's Rights are set forth in a Rights Agreement (the
"Boatmen's Rights Agreement") between Boatmen's and Boatmen's Trust
Company as Rights Agent (the "Rights Agent"), and the following
description is qualified in its entirety by the Boatmen's Rights
Agreement.

Until the earlier to occur of (i) ten days following a public
announcement that a person or group of affiliated or associated
persons (a "Boatmen's Acquiring Person") has acquired beneficial
ownership of twenty-percent (20%) or more of the outstanding shares
of Boatmen's Common; or (ii) ten business days (or such later date
as may be determined by action of the Board of Directors prior to
such time as any person becomes a Boatmen's Acquiring Person)
following the commencement of, or announcement of an

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intention to make, a tender or exchange offer the consummation of which
would result in the beneficial ownership by a person or group of twenty
percent (20%) or more of such outstanding shares of Boatmen's Common (the
earlier of such dates being called the "Boatmen's Distribution Date"), the
Boatmen's Rights will be evidenced, with respect to any of the Boatmen's
Common share certificates outstanding as of the Boatmen's Record Date, by
such Boatmen's Common share certificates, with a copy of a Summary of
Rights attached thereto.

The Boatmen's Rights Agreement provides that until the
Boatmen's Distribution Date (or earlier redemption or expiration of
the Boatmen's Rights) the Boatmen's Rights will be transferred only
with shares of Boatmen's Common. New Boatmen's Common share
certificates issued after the Boatmen's Record Date, upon transfer
or new issuance of Boatmen's Common, including issuance of shares
pursuant to the Merger, will contain a notation incorporating the
Boatmen's Rights Agreement by reference, and the surrender for
transfer of any certificates for Boatmen's Common outstanding as of
the Boatmen's Record Date, even without such notation or a copy of
the Summary of Rights being attached thereto, will also constitute
the transfer of the Boatmen's Rights associated with the Boatmen's
Common shares represented by such certificate. As soon as
practicable following the Boatmen's Distribution Date, separate
certificates evidencing the Boatmen's Rights (the "Boatmen's Right
Certificates") will be mailed to holders of record of Boatmen's
Common as of the close of business on the Boatmen's Distribution
Date and such separate Boatmen's Right Certificates alone will
evidence the Boatmen's Rights.

The Boatmen's Rights are not exercisable until the Boatmen's
Distribution Date. The Boatmen's Rights will expire on August 14,
2000 (the "Final Expiration Date"), unless the Final Expiration
Date is extended or unless the Boatmen's Rights are earlier
redeemed by Boatmen's, in each case as described herein.

The Boatmen's Purchase Price payable, and the number of shares
of Boatmen's Series C Preferred Stock or other securities or
property issuable, upon exercise of the Boatmen's Rights are
subject to adjustment from time to time upon the occurrence of
certain events in order to prevent dilution. In addition, the
number of outstanding Boatmen's Rights and the number of one one-
hundredths of a share of Boatmen's Series C Preferred Stock
issuable upon exercise of each Boatmen's Right are also subject to
adjustment in the event of a stock split of Boatmen's Common or a
stock dividend on Boatmen's Common payable in shares of Boatmen's
Common or subdivisions, consolidations or combinations of shares of
Boatmen's Common occurring, in any such case, prior to the
Boatmen's Distribution Date.

Boatmen's Series C Preferred Stock purchasable upon exercise
of the Boatmen's Rights will not be redeemable. Each share of
Boatmen's Series C Preferred Stock will be entitled to a minimum
preferential quarterly dividend payment of $1.00 per share and will
be entitled to an aggregate dividend of 100 times the dividend
declared on each share of Boatmen's Common. In the event of
liquidation, the holders of the Boatmen's Series C Preferred Stock
will be entitled to a minimum preferential liquidation payment of
$100 per share and will be entitled to an aggregate payment of 100
times the payment made on each share of Boatmen's Common. Each
share of Boatmen's Series C Preferred Stock will have 100 votes,
voting together with the Boatmen's Common shares. Finally, in the
event of any merger, consolidation or other transaction in which
shares of Boatmen's Common are exchanged, each share of Boatmen's
Series C Preferred Stock will be entitled to receive 100 times the
amount received on each share of Boatmen's Common. The Boatmen's
Rights are protected by customary anti-dilution provisions.

Because of the nature of the Boatmen's Series C Preferred
Stock's dividend, liquidation and voting rights, the value of the
one one-hundredth interest in a share of Boatmen's Series C
Preferred Stock purchasable upon exercise of each Boatmen's Right
should approximate the value of one Boatmen's Common share.

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In the event that Boatmen's is acquired in a merger or other
business combination transaction or fifty percent (50%) or more of
its consolidated assets or earning power are sold, proper provision
will be made so that each holder of a Boatmen's Right will
thereafter have the right to receive, upon the exercise thereof at
the then current exercise price of the Boatmen's Right, that number
of shares of common stock of the acquiring company which at the
time of such transaction will have a market value of two times the
exercise price of the Boatmen's Right. In the event that (i) any
person or group of affiliated or associated persons becomes the
beneficial owner of twenty percent (20%) or more of the outstanding
shares of Boatmen's Common (unless such person first acquires
twenty percent (20%) or more of the outstanding shares of Boatmen's
Common by a purchase pursuant to a tender offer for all of the
Boatmen's Common for cash, which purchase increases such person's
beneficial ownership to eighty percent (80%) or more of the
outstanding Boatmen's Common); or (ii) during such time as there is
a Boatmen's Acquiring Person, there shall be a reclassification of
securities or a recapitalization or reorganization of Boatmen's or
other transaction or series of transactions involving Boatmen's
which has the effect of increasing by more than one percent (1%)
the proportionate share of the outstanding shares of any class of
equity securities of Boatmen's or any of its subsidiaries
beneficially owned by the Boatmen's Acquiring Person, proper
provision will be made so that each holder of a Boatmen's Right,
other than Boatmen's Rights beneficially owned by the Boatmen's
Acquiring Person (which will thereafter be void), will thereafter
have the right to receive upon exercise that number of shares of
Boatmen's Common having a market value of two times the exercise
price of the Boatmen's Right.

At any time after the acquisition by a Boatmen's Acquiring
Person of beneficial ownership of twenty percent (20%) or more of
the outstanding shares of Boatmen's Common, and prior to the
acquisition by such Boatmen's Acquiring Person of fifty percent
(50%) or more of the outstanding shares of Boatmen's Common, the
Board of Directors of Boatmen's may exchange the Boatmen's Rights
(other than Boatmen's Rights owned by such person or group which
have become void), in whole or in part, at an exchange ratio of one
share of Boatmen's Common per Boatmen's Right (subject to
adjustment).

With certain exceptions, no adjustment in the Boatmen's
Purchase Price will be required until cumulative adjustments
require an adjustment of at least one percent (1%) of the Boatmen's
Purchase Price. No fractional shares of Boatmen's Series C
Preferred Stock will be issued (other than fractions which are
integral multiples of one one-hundredth of a share of Boatmen's
Series C Preferred Stock and which may, at the election of
Boatmen's, be evidenced by depositary receipts) and in lieu
thereof, an adjustment in cash will be made based on the market
price of the shares of Boatmen's Common on the last trading day
prior to the date of exercise.

At any time prior to the acquisition by a Boatmen's Acquiring
Person of beneficial ownership of twenty percent (20%) or more of
the outstanding shares of Boatmen's Common, the Board of Directors
of Boatmen's may redeem the Boatmen's Rights in whole, but not in
part, at a price of $0.01 per Boatmen's Right (the "Boatmen's
Redemption Price"). The redemption of the rights may be made
effective at such time, on such basis, and with such conditions as
the Board of Directors of Boatmen's in its sole discretion may
establish.

In addition, if a bidder who does not beneficially own more
than one percent (1%) of the shares of Boatmen's Common and all
other voting shares of Boatmen's (together the "Voting Shares")
(and who has not within the past year owned in excess of one
percent (1%) of the Voting Shares and, at a time he held a greater
than one percent (1%) stake, disclosed, or caused the disclosure
of, an intention which relates to or would result in the
acquisition or influence of control of Boatmen's) proposes to
acquire all of the Voting Shares for cash at a price which a
nationally recognized investment banker selected by such bidder
states in writing is fair, and such bidder has obtained written
financing commitments (or otherwise has financing) and complies
with certain procedural requirements, then Boatmen's, upon the
request of the bidder, will hold a special shareholders meeting to
vote on a resolution requesting the Board of Directors to accept
the bidder's proposal. If a majority of the outstanding shares
entitled to vote on the proposal vote in favor of

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such resolution, then for a period of 60 days after such meeting the
Boatmen's Rights will be automatically redeemed at the Boatmen's Redemption
Price immediately prior to the consummation of any tender offer for
all of such shares at a price per share in cash equal to or greater
than the price offered by such bidder; provided, however, that no
redemption will be permitted or required after the acquisition by
any person or group of affiliated or associated persons of
beneficial ownership of twenty percent (20%) or more of the
outstanding shares of Boatmen's Common. Immediately upon any
redemption of the Boatmen's Rights, the right to exercise the
Boatmen's Rights will terminate and the only right of the holders
of Boatmen's Rights will be to receive the Boatmen's Redemption
Price.

The terms of the Boatmen's Rights may be amended by the Board
of Directors of Boatmen's without the consent of the holders of the
Boatmen's Rights, including an amendment to lower certain
thresholds described herein to not less than the greater of (i) any
percentage greater than the largest percentage of the outstanding
shares of Boatmen's Common then known to Boatmen's to be
beneficially owned by any person or group of affiliated or
associated persons; or (ii) ten percent (10%), except that from and
after such time as any person becomes a Boatmen's Acquiring Person
no such amendment may adversely affect the interests of the holders
of the Boatmen's Rights.

Until a Boatmen's Right is exercised, the holder thereof, as
such, will have no rights as a shareholder of Boatmen's, including,
without limitation, the right to vote or to receive dividends.

DISSENTERS' RIGHTS

Under the Missouri Law, a shareholder of a corporation is
entitled to receive payment for the fair value of his or her shares
if such shareholder dissents from a sale or exchange of
substantially all of the property and assets of the corporation, or
a merger or consolidation to which such corporation is a party. A
shareholder is also entitled to receive payment for the fair value
of his or her shares if such shareholder dissents from according
voting rights to "control shares" in a control share acquisition,
as further described herein. See "COMPARISON OF SHAREHOLDER RIGHTS
- -- Takeover Statutes." Because Boatmen's is not merging directly
with SCB, Boatmen's shareholders will not be entitled to assert
such rights in connection with the Holding Company Merger.

Under the Illinois Law, a shareholder of a corporation is
entitled to (i) dissent from, among other things, a plan of merger,
consolidation, or a plan of share exchange if shareholder
authorization is required or the corporation is a subsidiary merged
with its parent or another subsidiary, and (ii) demand payment of
the fair or appraised value of his or her stock. For a more
complete discussion of the rights of dissenters of SCB Common see
"THE MERGER -- Dissenters' Rights."

TAKEOVER STATUTES

The Missouri Law contains provisions regulating a broad range
of business combinations, such as a merger or consolidation,
between a Missouri corporation with shares of its stock registered
under the federal securities laws, or a corporation that makes an
election to be subject to the provisions of this statute, and an
"interested shareholder" (which is defined as any owner of twenty
percent (20%) or more of the corporation's stock) for five years
after the date on which such shareholder became an interested
shareholder, unless the stock acquisition which caused the person
to become an interested shareholder was approved in advance by the
corporation's board of directors. This so-called "five year
freeze" provision is effective even if all the parties should
subsequently decide that they wish to engage in a business
combination. The Missouri Law also contains a "control share
acquisition" provision which effectively denies voting rights to
shares of a Missouri corporation acquired in control share
acquisitions unless a resolution granting such voting rights is
approved at a meeting of shareholders by affirmative majority vote

50
57
of (i) all outstanding shares entitled to vote at such meeting
voting by class if required by the terms of such shares; and
(ii) all outstanding shares entitled to vote at such meeting voting
by class if required by the terms of such shares, excluding all
interested shares. A control share acquisition is one by which a
purchasing shareholder acquires more than one-fifth (1/5), one-
third (1/3), or a majority, under various circumstances, of the
voting power of the stock of an "issuing public corporation." An
"issuing public corporation" is a Missouri corporation with (i) one
hundred or more shareholders; (ii) its principal place of business,
principal office or substantial assets in Missouri; and
(iii) either (a) more than ten percent (10%) of its shareholders
resident in Missouri; (b) more than ten percent (10%) of its shares
owned by Missouri residents; or (c) 10,000 shareholders resident in
Missouri. Boatmen's meets the statutory definition of an issuing
public corporation. Finally, if a control share acquisition should
be made of a majority or more of the corporation's voting stock,
and those shares are granted full voting rights, shareholders are
granted dissenters' rights.

In general, the Illinois Law prohibits any business
combination such as a merger, consolidation or share exchange,
among other things, between an Illinois corporation (defined as a
domestic corporation that (i) has securities registered under the
Federal Securities Laws, (ii) either has its principal place of
business or principal executive office in Illinois or controls
assets located in Illinois with a fair market value of at least one
million dollars and (iii) either has more than ten percent (10%) of
its shareholders resident in Illinois, more than ten percent (10%)
of its shares owned by Illinois residents or has 2,000 shareholders
resident in Illinois) and an interested shareholder (which is
defined as anyone that owns fifteen percent (15%) or more of the
outstanding voting shares of a corporation) for a period of three
years following the date that such shareholder became an interested
shareholder unless (i) prior to such date the board of directors
approved the business combination or transaction which resulted in
the shareholder becoming an interested shareholder, or (ii) upon
consummation of the transaction which resulted in the shareholder
becoming an interested shareholder, the interested shareholder
owned at least eighty-five percent (85%) of the voting shares of
the corporation excluding shares owned by persons who are not
directors or officers and employees' stock plans in which employee
participants do not have a right to determine confidentially where
their shares will be tendered in a tender exchange offer, or (iii)
on or subsequent to such date the business combination is approved
by the board of directors and authorized in an annual meeting of
the interested shareholders by the affirmative vote of at least
two-thirds (2/3) of the outstanding shares which are not owned by
the interested shareholder. The articles of incorporation of an
Illinois corporation may contain a provision expressly electing not
to be governed by this section. This law does not apply to SCB
because shares of SCB Common are not listed on a national
securities exchange or Nasdaq, are not held of record by more than
2,000 shareholders and the Articles of Incorporation of SCB do not
provide that the foregoing provision of the Illinois Law, or
similar provision, should apply.

Illinois Law also requires a higher vote for certain business
combinations, including, among others, a merger, consolidation or
exchange between an Illinois corporation which has a class of
securities registered under the Federal Securities Laws or which
specifically adopts to be governed by Section 7.85 of the Illinois
Law and any interested shareholder (defined as any person who is
the beneficial owner of Voting Shares (as defined below) conveying
ten percent (10%) or more of the combined voting power of the then
outstanding Voting Shares or is an Affiliate or Associate of a
corporation and at any time within two years prior to the date in
question was the beneficial owner of voting shares conveying ten
percent (10%) or more of the combined voting power of the
outstanding Voting Shares). The higher vote for such a business
combination requires (i) affirmative vote of holders of at least
eighty percent (80%) of the combined voting power of the
outstanding shares of all classes and series entitled to generally
vote in the election of directors ("Voting Shares"), and (ii) the
affirmative vote of the majority of the combined voting power of
the outstanding voting shares held by disinterested shareholders
voting together as a single class. However, there are certain
circumstances in which the higher voting would not be required as
set forth in Section 7.85 of the Illinois Law. The provisions of
Section 7.85 of the Illinois Law do not apply to SCB.

51
58

LIABILITY OF DIRECTORS; INDEMNIFICATION

Pursuant to the Missouri Law and the Illinois Law, each
corporation may indemnify certain persons, including officers and
directors, in connection with liabilities arising from legal
proceedings resulting from such person's service to the corporation
in certain circumstances. The respective Articles of Incorporation
and Bylaws of Boatmen's and SCB obligate each to indemnify
directors and certain officers. Each of Boatmen's and SCB may also
voluntarily undertake to indemnify certain persons acting on the
corporation's behalf in certain circumstances. While the
indemnification laws and provisions applicable to Boatmen's and SCB
are substantially similar in most material respects, there are
certain material differences which are discussed herein.

Section 351.355(1) and (2) of the Missouri Law provides that
a corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or
completed action, suit or proceeding by reason of the fact that he
is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation
as director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against
expenses, judgments, fines and amounts paid in settlement actually
and reasonably incurred by him in connection with such action, suit
or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests
of the corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was
unlawful, except that, in the case of an action or suit by or in
the right of the corporation, the corporation may not indemnify
such persons against judgments and fines and no person shall be
indemnified as to any claim, issue or matter as to which such
person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the corporation unless
and only to the extent that the court in which the action or suit
was brought determines upon application that such person is fairly
and reasonably entitled to indemnity for proper expenses. Section
351.355 further provides that, to the extent that a director,
officer, employee or agent of the corporation has been successful
in the defense of any such action, suit or proceeding or any claim,
issue or matter therein, he shall be indemnified against expenses,
including attorney's fees, actually and reasonably incurred in
connection with such action, suit or proceeding. Section 351.355
also provides that a Missouri corporation may provide additional
indemnification to any person indemnifiable under subsection (1) or
(2), provided such additional indemnification is authorized by the
corporation's articles of incorporation or an amendment thereto or
by a shareholder-approved bylaw or agreement, and provided further
that no person shall thereby be indemnified against conduct which
was finally adjudged to have been knowingly fraudulent,
deliberately dishonest or willful misconduct. The Restated
Articles of Incorporation of Boatmen's provide that it shall
indemnify its directors and certain of its executive officers to
the full extent specified in Section 351.355 and, in addition,
shall indemnify each of them against all expenses incurred in
connection with any claim by reason of service for or at the
request of the registrant in any of the capacities referred to in
Section 351.355 or arising out of his or her status in any such
capacity, provided that he or she may not be indemnified against
conduct finally adjudged to have been knowingly fraudulent,
deliberately dishonest or wilful misconduct, and that it may extend
to other officers, employees and agents such indemnification and
additional indemnification.

Section 8.75 of the Illinois Law permits an Illinois
corporation to indemnify a person who, by reason of his or her
relationship with the corporation, was or is a party, or is
threatened to be made a party, to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, including any action by or in the
right of the corporation, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action,
suit or proceeding, if such person acted in good faith and in a
manner he or she reasonably believed to be in, or not opposed to,
the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe
his or her conduct was unlawful; provided, however, that in the
case of actions by or in the right of the corporation, no
indemnification may be made in respect of any claim, issue or
matter as to which such person has been

52
59
adjudged to be liable to the corporation, unless, and only to the extent
that, the court in which such action or suit was brought determines upon
application that despite the adjudication of liability, but in view of all
the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses as the court deems proper.
Notwithstanding the foregoing, the Illinois Law provides that, to
the extent that such person has been successful, on the merits or
otherwise, in the defense of any action, suit or proceeding
referred to above, or in defense of any claim, issue or matter
therein, such person must be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by
such person in connection therewith. Illinois Law provides that
indemnification may be made by an Illinois corporation only as
authorized in the specific case upon a determination that
indemnification of such person is proper in the circumstances
because he or she met the applicable standard of conduct. Such
determination is to be made by (i) the board of directors by a
majority vote of a quorum of directors not parties to such action,
suit or proceeding or (ii) if such quorum is not obtainable, or
even if obtainable, if a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or
(iii) by the shareholders.

Neither SCB's Articles of Incorporation nor Bylaws contain a
provision regarding indemnification of directors or officers.

LIMITATION OF LIABILITY OF DIRECTORS

The Missouri Law provides that a Missouri corporation may
include any provision in its articles of incorporation which are
not inconsistent with the law, but does not specifically prohibit
or allow a provision limiting the liability of directors in the
articles of incorporation of a Missouri corporation. Other than in
regard to the indemnification of directors, Boatmen's Articles of
Incorporation do not contain a provision regarding the liability
of directors.

The Illinois Law provides that an Illinois corporation may
include in its articles of incorporation a provision eliminating or
limiting the personal liability of a director to the corporation or
its shareholders for monetary damages for breach of fiduciary duty
as a director, provided that the provision does not eliminate or
limit the liability of a director (i) for any breach of the
director's duty of loyalty to the corporation or its shareholders,
(ii) for acts or omissions not in good faith or that involve
intentional misconduct or a violation of law, (iii) under certain
provisions of the Illinois Law, and (iv) for any transaction in
which the director derived an improper personal benefit. No such
provision may eliminate or limit the liability of any director for
any act or omission occurring before the date when the provision is
included in the articles of incorporation. SCB's Articles of
Incorporation do not contain such a provision.

CONSIDERATION OF NON-SHAREHOLDER INTERESTS

The Missouri Law provides that in exercising business judgment
in consideration of acquisition proposals, a Missouri corporation's
board of directors may consider the following factors, among
others: (i) the consideration being offered; (ii) the existing
political, economic, and other factors bearing on security prices
generally, or the corporation's securities in particular;
(iii) whether the acquisition proposal may violate any applicable
laws; (iv) social, legal and economic effects on employees,
suppliers, customers and others having similar relationships with
the corporation, and the communities in which the corporation
conducts its businesses; (v) the financial condition and earning
prospects of the person making the acquisition proposal; and
(vi) the competence, experience and integrity of the person making
the acquisition proposal.

The Illinois Law provides that, in discharging the duties of
their respective positions, the board of directors and individual
directors may, in considering the best long-term and short-term
interests of an Illinois corporation, consider the effects of any
action upon employees, suppliers and customers of such

53
60
corporation or its subsidiaries, communities in which offices or other
establishments of the corporation or its subsidiaries are located,
and all other pertinent factors.

INFORMATION ABOUT SCB

BUSINESS OF SCB AND COMMUNITY BANK

SCB is a registered single bank holding company incorporated
under the laws of the State of Illinois in January 1985. As of
September 30, 1994, SCB and its subsidiary, Community Bank, had
consolidated assets of $79,178,000, deposits of $72,273,000, loans,
net of unearned discount, of $50,821,000, and stockholders' equity
of $4,511,000, and employed 39 full-time equivalent employees. SCB
owns 96.37% of the outstanding capital stock of Community Bank.

Community Bank is a full-service commercial bank, offering
complete banking services to the commercial and residential areas
which it serves throughout Marion County, Illinois. Services
include commercial, real estate and personal loans, money market
accounts, checking and savings accounts and time deposit accounts,
and trust services.

The lending portion of Community Bank's business relates
primarily to real estate, the activities of small to medium sized
businesses and local community residences.

SCB is subject to vigorous competition from major banking
institutions, as well as other financial institutions in its
principal service area, such as savings and loan associations,
insurance companies, and finance companies.

SCB and Community Bank are subject to supervision, regulation,
and examination by the Federal Reserve, the Illinois Commissioner,
and the F.D.I.C. The deposits of Community Bank are insured by the
Bank Insurance Fund (BIF) of the F.D.I.C.

STATISTICAL INFORMATION ABOUT SCB

In the following pages, various statistical information about
SCB and Community Bank is presented. Such information should be
read in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations of SCB and Community
Bank" and the consolidated financial statements included elsewhere
herein.

DISTRIBUTION OF AVERAGE ASSETS, LIABILITIES AND STOCKHOLDERS'
EQUITY, AND INTEREST RATES

The following table shows the condensed average balance sheets
for the periods presented and the percentage of each principal
category of assets, liabilities, and stockholders' equity to total
assets. Also shown is the average yield on each category of
interest-earning assets and the average rate paid on interest-
bearing liabilities for each of the periods presented.

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61

Nine Months Ended September 30,
--------------------------------------------------------------------------------
1994 1993
--------------------------------------- -------------------------------------
PERCENT INTEREST AVERAGE PERCENT INTEREST AVERAGE
AVERAGE OF TOTAL INCOME/ YIELD/ AVERAGE OF TOTAL INCOME/ YIELD/
BALANCE ASSETS EXPENSE RATE<F1> BALANCE ASSETS EXPENSE RATE<F1>
------- -------- -------- -------- ------- -------- -------- --------

Assets: (Dollars in Thousands)
Interest-earning assets:
Loans<F2> $ 49,437 62.59% $ 3,061 8.26% $ 41,669 55.14% $ 2,780 8.90%
Taxable investment securities 16,302 20.64 586 4.79 19,126 25.31 808 5.63
Nontaxable investment securities<F3> 5,162 6.53 285 7.36 5,038 6.67 302 7.98
Federal funds sold 2,959 3.75 83 3.74 3,493 4.62 77 2.94
Interest-bearing deposits 483 0.61 27 7.45 675 0.89 35 6.91
-------- ------ ------- -------- ------ ------- ----
Total interest-earning assets 74,343 94.12 4,042 7.25 70,001 92.63 4,002 7.62
------- ---- ------- ----
Non-interest-earning assets:
Cash and due from banks 2,790 3.53 3,462 4.58
Premises and equipment, net 1,573 1.99 1,628 2.15
Other assets 936 1.19 1,033 1.37
Allowance for possible loan losses (653) (0.83) (556) (0.73)
-------- ------ -------- ------
Total assets $ 78,989 100.00% $ 75,568 100.00%
======== ====== ======== ======
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits $ 14,919 18.89% $ 246 2.20% $ 15,202 20.12% $ 267 2.34%
Savings and market rate deposits 9,230 11.69 192 2.77 8,548 11.31 188 2.93
Time deposits 38,287 48.47 1,152 4.01 37,367 49.45 1,174 4.19
Note payable 1,725 2.18 80 6.18 1,938 2.56 89 6.12
-------- ------ ------- -------- ------ -------
Total interest-bearing liabilities 64,161 81.23 1,670 3.47 63,055 83.44 1,718 3.63
------- ---- ------- ----
Non-interest-bearing liabilities:
Demand deposits 9,794 12.40 8,229 10.89
Other liabilities 738 0.93 760 1.01
-------- ------ -------- ------
Total non-interest-bearing liabilities 10,532 13.33 8,989 11.90
-------- ------ -------- ------
Total liabilities 74,693 94.56 72,044 95.34
Stockholders' equity 4,296 5.44 3,524 4.66
-------- ------ -------- ------
Total liabilities and stockholders' equity $ 78,989 100.00% $ 75,568 100.00%
======== ====== ======== ======

Net interest income $ 2,372 $ 2,284
======= =======
Interest rate spread 3.78% 3.99%
==== ====
Net interest rate margin 4.25% 4.35%
==== ====
- ------------------------------------
<FN>
<F1> Average yield/rate for the nine months ended September 30,
1994 and 1993 is annualized.
<F2> Average balances include nonaccrual loans. The income on such
loans is included in interest but is recognized only upon
receipt.
<F3> Nontaxable investment income is presented on a fully tax-
equivalent basis assuming a tax rate of 34%.

55
62

YEAR ENDED DECEMBER 31,
--------------------------------------------------------------------------------
1993 1992
--------------------------------------- -------------------------------------
PERCENT INTEREST AVERAGE PERCENT INTEREST AVERAGE
AVERAGE OF TOTAL INCOME/ YIELD/ AVERAGE OF TOTAL INCOME/ YIELD/
BALANCE ASSETS EXPENSE RATE<F1> BALANCE ASSETS EXPENSE RATE<F1>
------- -------- -------- -------- ------- -------- -------- --------

Assets: (Dollars in Thousands)

Interest-earning assets:
Loans<F1> $ 42,812 56.07% $ 3,779 8.83% $ 38,415 53.26% $ 3,738 9.73%
Taxable investment securities 18,784 24.60 1,034 5.50 19,348 26.83 1,281 6.62
Nontaxable investment securities<F2> 5,065 6.63 402 7.94 3,989 5.53 361 9.05
Federal funds sold 3,642 4.77 107 2.94 3,997 5.54 137 3.43
Interest-bearing deposits 653 0.86 46 7.04 9.75 1.36 72 7.38
------ ------ ----- ------ ------ ------
Total interest-earning assets 70,956 92.93 5,368 7.57 66,724 92.52 5,589 8.38
----- ---- ------ ----
Non-interest-earning assets:
Cash and due from banks 3,338 4.37 3,118 4.32
Premises and equipment 1,621 2.12 1,679 2.33
Other assets 1,016 1.33 1,078 1.49
Allowance for possible loan losses (570) (0.75) (476) (0.66)
------ ------ ------- ------
Total assets $ 76,361 100.00% $ 72,123 100.00%
====== ====== ======= ======
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits $ 15,188 19.89% $ 350 2.30% $ 14,976 20.76% $ 491 3.28%
Savings and market rate deposits 8,807 11.53 252 2.86 7,126 9.88 255 3.58
Time deposits 37,580 49.21 1,555 4.14 36,600 50.75 1,965 5.37
Notes payable 1,875 2.46 118 6.29 2,125 2.95 145 6.82
------ ------ ----- ------ ------ ------
Total interest-bearing liabilities 63,450 83.09 2,275 3.59 60,827 84.34 2,856 4.70
----- ---- ------ ----
Non-interest-bearing liabilities:
Demand deposits 8,506 11.14 7,604 10.54
Other liabilities 764 1.00 800 1.11
------ ------ ------ ------
Total non-interest-bearing liabilities 9,270 12.14 8,404 11.65
------ ------ ------ ------
Total liabilities 72,720 95.23 69,231 95.99
Stockholders' equity 3,641 4.77 2,892 4.01
------ ------ ------ ------
Total liabilities and stockholders' equity $ 76,361 100.00% $ 72,123 100.00%
====== ====== ====== ======
Net interest income $ 3,093 $2,733
===== =====
Interest rate spread 3.98% 3.68%
==== ====
Net interest rate margin 4.36% 4.10%
==== ====

1991
------------------------------------------------------
PERCENT INTEREST AVERAGE
AVERAGE OF TOTAL INCOME/ YIELD/
BALANCE ASSETS EXPENSE RATE<F1>
------- -------- -------- --------

Assets:
Interest-earning assets:
Loans<F1> $37,139 55.71% $ 4,010 10.80%
Taxable investment securities 15,301 22.95 1,233 8.06
Nontaxable investment securities<F2> 3,862 5.79 242 6.27
Federal funds sold 4,092 6.14 345 8.43
Interest-bearing deposits 1,036 1.56 81 7.82
------ ------ -----
Total interest-earning assets 61,430 92.15 5,911 9.62
----- -----
Non-interest-earning assets:
Cash and due from banks 2,727 4.09
Premises and equipment 1,721 2.58
Other assets 1,189 1.78
Allowance for possible loan losses (402) (0.60)
------ ------
Total assets $66,665 100.00%
====== ======
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing demand deposits $12,877 19.32% $ 624 4.85%
Savings and market rate deposits 5,330 8.00 248 4.65
Time deposits 36,095 54.14 2,477 6.86
Notes payable 2,325 3.48 224 9.63
------ ------ -----
Total interest-bearing liabilities 56,627 84.94 3,573 6.31
----- -----
Non-interest-bearing liabilities:
Demand deposits 6,813 10.22
Other liabilities 858 1.29
------ ------
Total non-interest-bearing liabilities 7,671 11.51
------ ------
Total liabilities 64,298 96.45
Stockholders' equity 2,367 3.55
------ ------
Total liabilities and stockholders' equity $66,665 100.00%
====== ======
Net interest income $ 2,338
=====
Interest rate spread 3.31%
=====
Net interest rate margin 3.81%
=====
<FN>
- ------------------------------------

<F1> Average balances include nonaccrual loans. The income on such loans
is included in interest but is recognized only upon receipt.
<F2> Nontaxable investment income is presented on a fully tax-equivalent
basis assuming a tax rate of 34%.

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63

INTEREST DIFFERENTIAL

The following table sets forth, on a tax-equivalent basis for the
periods indicated, a summary of the changes in interest income and interest
expense resulting from changes in yields/rates:

AMOUNT OF INCREASE (DECREASE)
-----------------------------
1993 COMPARED TO 1992 1992 COMPARED TO 1991
INCREASE (DECREASE) INCREASE (DECREASE)
DUE TO DUE TO
----------------------- ------------------------
VOLUME RATE VOLUME RATE
<F1> <F2> NET <F1> <F2> NET
---- ---- --- ---- ---- ---
(DOLLARS IN THOUSANDS)

Interest earned on:
Loans $ 405 (364) 41 135 (407) (272)
Taxable investment securities (36) (211) (247) 291 (243) 48
Nontaxable investment securities<F3> 89 (48) 41 8 111 119
Federal funds sold (11) (19) (30) (8) (200) (208)
Interest-bearing deposits (23) (3) (26) (4) (5) (9)
---- ---- ---- --- ---- ----
424 (645) (221) 422 (744) (322)
==== ===== ===== === ===== =====
Interest paid on:
Interest-bearing demand deposits 7 (148) (141) 91 (224) (133)
Savings and market rate deposits 101 (131) (30) 153 (210) (57)
Time deposits 45 (428) (383) 31 (479) (448)
Short-term borrowings (16) (11) (27) (19) (60) (79)
----- ----- ----- ----- ----- -----
137 (718) (581) 256 (973) (717)
----- ----- ----- ---- ----- -----
Net interest income $ 287 73 360 166 229 395
==== === ==== ==== ==== ====
- -------------------------
<FN>
<F1> Change in volume multiplied by yield/rate of prior period.
<F2> Change in yield/rate multiplied by volume of prior period.
<F3> Nontaxable investment securities are presented on a fully tax-
equivalent basis assuming a tax rate of 34%.

NOTE: The change in interest due to both rate and volume has been
allocated to rate and volume changes in proportion to the relationship of
the absolute dollar amounts of the change in each.

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64

INVESTMENT PORTFOLIO

The book value of investment securities is summarized as follows:

DECEMBER 31,
---------------------------------------------------------------------------------
1993 1992 1991
---------------------- ------------------------ ------------------------
PERCENT PERCENT PERCENT
OF TOTAL OF TOTAL OF TOTAL
AMOUNT SECURITIES AMOUNT SECURITIES AMOUNT SECURITIES
------ ---------- ------ ---------- ------ ----------
(Dollars in Thousands)

U.S. Treasury and other U.S.
government agencies and
corporations $15,940 71.9% $18,149 72.4% $15,322 71.8%
State and municipal 5,282 23.9 5,065 20.2 3,797 17.8
Other 933 4.2 1,865 7.4 2,219 10.4
------- ----- ------ ----- ------ -----
Total $22,155 100.0% $25,079 100.0% $21,338 100.0%
======= ===== ====== ===== ====== =====

The following table summarizes maturity and yield information for the
investment portfolio at December 31, 1993:

AFTER ONE
IN ONE YEAR THROUGH OVER
OR LESS FIVE YEARS FIVE YEARS
------- ---------- ----------
YIELD YIELD YIELD
AMOUNT <F1> AMOUNT <F1> AMOUNT <F1>
------ ----- ------ ----- ------ -----
(Dollars in Thousands)

U.S. Treasury and other U.S.
government agencies and
corporations $ 906 6.7% $ 9,515 4.7% $ 5,519 7.4%
State and municipal 2,044 8.1 3,125 7.0 113 8.7
Other 9 5.5 -- -- 924 5.5
----- ------ -----
Total $2,959 7.7% $12,640 5.3% $ 6,556 7.2%
===== === ====== === ===== ===

- -------------------------
<FN>
<F1> Presented on a fully tax-equivalent basis assuming a tax rate of 34%.

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65

LOAN PORTFOLIO

Types of Loans:
--------------

The composition of the loan portfolio is summarized as follows:

DECEMBER 31,
---------------------------------------------------------------------------------
1993 1992 1991
---------------------- ------------------------ ------------------------
PERCENT PERCENT PERCENT
OF TOTAL OF TOTAL OF TOTAL
AMOUNT LOANS AMOUNT LOANS AMOUNT LOANS
------ ----- ------ ----- ------ -----
(Dollars in Thousands)

Commercial, financial and agricultural $12,039 24.7% $10,309 25.3% $10,550 26.9%
Real estate:
Commercial 5,475 11.2 4,770 11.7 5,038 12.9
Residential 15,853 32.5 13,656 33.5 12,328 31.5
Construction 902 1.9 676 1.7 97 .2
------ ---- ------ ----- ------ ----
Total 22,230 45.6 19,102 46.9 17,463 44.6
Consumer and other 14,462 29.7 11,352 27.8 11,146 28.5
------ ---- ------ ----- ------ ----

Total loans $48,731 100.0% $40,763 100.0% $39,159 100.0%
======= ====== ======= ====== ======= ======

The following tables set forth the maturities and interest sensitivity
composition of total loans at December 31, 1993:

Fixed Rate Loans:
----------------

DECEMBER 31, 1993 MATURING
---------------------------------------------------------------------------
AFTER ONE
IN ONE THROUGH AFTER
YEAR OR LESS FIVE YEARS FIVE YEARS TOTAL
------------ ---------- ---------- -----
(Dollars in Thousands)

Commercial, financial and agricultural $ 5,592 1,702 39 7,333
Real estate:
Commercial 2,023 2,461 -- 4,484
Residential 15 358 9 382
Construction 902 -- -- 902
----- ---- --- -----
2,940 2,819 9 5,768
Consumer and other 1,433 12,612 185 14,230
------ ------ --- ------

Total Loans $ 9,965 17,133 233 27,331
======= ====== === ======

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66

Variable Rate Loans:
-------------------

Commercial, financial and agricultural $ 4,706 -- -- 4,706
Real estate:
Commercial 991 -- -- 991
Residential 686 14,785 -- 15,471
Construction -- -- -- --
----- ------ ------ ------
1,677 14,785 -- 16,462
Consumer and other 20 212 -- 232
----- ------ ------ ------
$ 6,403 14,997 -- 21,400
======= ====== ====== ======

The following table summarizes maturity information for the loan
portfolio as of December 31, 1993:

Commercial, financial and agricultural $ 10,298 1,702 39 12,039
Real estate:
Commercial 3,014 2,461 -- 5,475
Residential 701 15,143 9 15,853
Construction 902 -- -- 902
------ ------ -- ------
4,617 17,604 9 22,230
Consumer and other 1,453 12,824 185 14,462
------- ------ --- ------

$ 16,368 32,130 233 48,731
======== ====== === ======

In the normal course of business, SCB's and Community Bank's
practice is to consider and act upon borrowers' requests for renewal of
loans at their maturity. Evaluation of such requests includes a review
of the borrower's credit history, the collateral securing the loan, and
the purpose of such request. In general, loans which SCB and Community
Bank renew at maturity require payment of accrued interest, a reduction
in the loan balance, and/or pledging of additional collateral and a
potential adjustment of the interest rate to reflect changes in economic
conditions.

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Risk Elements Involved in Lending Activities:
--------------------------------------------

The following table details the nonperforming loan information for the
periods presented:

DECEMBER 31,
SEPTEMBER 30, -------------------------------------
1994 1993 1992 1991
------------- ---- ---- ----
(Dollars in Thousands)

Nonaccrual loans $ 3 -- 111 324
Loans past due 90 days or more 21 8 13 24
Restructured loans -- -- 9 286
---- --- --- ---
Total nonperforming loans 24 8 133 634
Foreclosed property -- -- 18 17
---- --- --- ---

Total nonperforming assets $ 24 8 151 651
==== === === ===

Nonperforming loans to loans .05% .02% .33% 1.62%
Nonperforming assets to loans plus
foreclosed property .05 .02 .37 1.66
Nonperforming assets to total assets .03 .01 .21 .93

It is generally the policy of SCB and Community Bank to discontinue
the accrual of interest on loans when principal or interest is due and
has remained unpaid for 90 days or more, unless the loan is well secured
and in the process of collection.

Potential Problem Loans: Certain loans may require frequent
-----------------------
management attention and are reviewed on a monthly or more frequent
basis. Although payments on these loans are less than 90 days past due,
or in many cases current, the borrowers presently have or have had a
history of financial difficulties and management has concern as to the
borrower's ability to comply with present loan repayment terms. As
such, these loans may result in classification at some future point as
nonperforming. At September 30, 1994, such loans (excluding all
nonperforming loans described above) amounted to $1,298,000.

Foreign Outstandings: SCB and Community Bank had no loans to
--------------------
any foreign countries on any of the dates specified in the tables.

Loan Concentrations: SCB and Community Bank do not have any
-------------------
particular concentration of credit in any one economic sector; however,
a substantial portion of the portfolio is concentrated and secured by
real estate. The ability of SCB's and Community Bank's borrowers to
honor their contractual obligations is dependent on the local economy
and its effect on the real estate market.

OTHER INTEREST-BEARING ASSETS

Other interest-bearing assets, consisting of federal funds sold and
interest-bearing deposits with other financial institutions, amounted to
$3,010,000, $3,755,000, and $2,800,000 at September 30, 1994, and
December 31, 1993 and 1992, respectively. Federal funds sold are highly
rate sensitive.

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68

SUMMARY OF LOAN LOSS EXPERIENCE

The following table summarizes changes in the allowance for
possible loan losses arising from loans charged-off and recoveries on
loans previously charged-off, by loan category and additions to the
allowance that have been charged to expense:

December 31,
September 30, -------------------------
1994 1993 1992 1991
------------- ---- ---- ----
(Dollars in Thousands)

Balance at beginning of period $617 521 425 370
-------- -------- ------ -----
Loans charged off:
Commercial, financial, and agricultural 4 14 52 39
-------- -------- ------ -----
Real estate:
Commercial -- -- -- 55
Residential 3 -- 6 --
Construction -- -- -- --
-------- -------- ------ -----

Total real estate 3 -- 65 5
Consumer 6 9 38 40
-------- -------- ------ -----

Total charge-offs 13 23 96 134
-------- -------- ------ -----
Recoveries of loans previously charged off:
Commercial, financial, and agricultural -- -- 8 24
Real estate:
Commercial -- -- -- --
Residential -- -- 2 --
Construction -- -- -- --
-------- -------- ------ -----

Total real estate -- -- 2 --
Consumer 4 9 8 --
-------- -------- ------ -----

Total recoveries 4 9 18 24
-------- -------- ------ -----

Net loans charged off 9 14 78 110
-------- -------- ------ -----

Additions to reserve charged to operations 70 110 174 165
-------- -------- ------ -----

Balance at end of period $ 678 617 521 425
======== ======== ====== =====

Net loan charge-offs to average loans<F1> .02% .03% .20% .30%
Allowance for possible loans losses
to loans 1.30 1.27 1.28 1.09
Allowance for possible loan losses
to nonperforming loans 2,825.00 7,712.50 391.73 67.03
======== ======== ====== =====
<FN>
- -------------------------
<F1> Ratios for the nine-month period ended September 30, 1994 are annualized.

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69

In determining an adequate balance in the allowance for possible
loan losses, SCB's and Community Bank's management places its emphasis
as follows: evaluation of the loan portfolio with regard to potential
future exposure on loans to specific customers and industries;
reevaluation of each nonperforming loan or loans classified by
supervisory authorities; and an overall review of the remaining
portfolio in light of past loan loss experience.

Management views the allowance for possible loan losses as being
available for all potential or previously unidentifiable loan losses
which may occur in the future. The risk of future losses that is
inherent in the loan portfolio is not precisely attributable to a
particular loan or category of loans. Based on its review of adequacy,
SCB's and Community Bank's management has estimated those portions of
the allowance that could be attributable to major categories of loans as
detailed in the table below:

December 31,
------------------------------------------------------------------------
1993 1992 1991
--------------------- --------------------- ---------------------
Percent of Percent of Percent of
loans in loans in loans in
each each each
category category category
Allow- to total Allow- to total Allow- to total
ance loans ance loans ance loans
------ ---------- ------ ---------- ------ ----------
(Dollars in Thousands)

Commercial, financial and
agricultural $146 24.7% $144 25.3% $149 26.9%
---- ----- ---- ----- ---- -----
Real estate:
Commercial 48 11.2 55 11.7 35 12.9
Residential 142 32.5 156 33.5 86 31.5
Construction 8 1.9 8 1.7 1 .2
---- ----- ---- ----- ---- -----
Total real estate 198 45.6 219 46.9 122 44.6
Consumer and other 78 29.7 61 27.8 42 28.5
Not allocated 195 N/A 97 N/A 112 N/A
---- ----- ---- ----- ---- -----
$617 100.0% $521 100.0% $425 100.0%
==== ===== ==== ===== ==== =====

Allocations estimated for the loan categories do not specifically
represent that loan charge-offs of that magnitude will necessarily be
incurred. The allocation does not restrict future loan losses
attributable to other categories. The risk factors considered when
determining the overall level of the allowance are the same when
estimating the allocation by major category, as specified in the
allowance category.

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70

DEPOSITS

The following table shows for each type of deposit, the average
monthly amount, and the average rate paid on each type of deposit for
the years ended December 31, 1993, 1992, and 1991:

1993 1992 1991
---------------------------------------------------------
Average Average Average
balance Rate balance Rate balance Rate
------- ---- ------- ---- ------- ----
(Dollars in Thousands)

Non-interest-bearing demand deposits $ 8,506 ---% $7,604 ---% $6,813 ---%
Interest-bearing demand deposits 15,188 2.30 14,976 3.28 12,877 4.85
Savings and market rate deposits 8,807 2.86 7,126 3.58 5,330 4.65
Time deposits 37,580 4.14 36,600 5.37 36,095 6.86
------- ------- -------
$70,081 3.50% $66,306 4.62% $61,115 6.17%
======= ==== ======= ==== ======= ====

The following table shows the maturity of time deposits of $100,000
or more at December 31, 1993:

Time Certificates
of Deposits
-----------
(Dollars in Thousands)

Three months or less $1,552
Over three through six months 1,602
Over six through twelve months 2,276
Over twelve months 875
------
$6,305
======

RETURN ON EQUITY AND ASSETS

The following ratios are among those commonly used in analyzing banks
and bank holding companies:

December 31,
------------------------------
1993 1992 1991
---- ---- ----

Return on average assets 1.10% 0.86% 0.64%
Return on average equity 22.99 21.51 18.12
Dividend payout ratio N/A N/A N/A
Average equity to assets ratio 4.77 4.01 3.55

PROPERTIES

SCB's and Community Bank's principal banking office is located at
401 West Main, Salem, Illinois 62881.

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71

LEGAL PROCEEDINGS

For a discussion of legal proceedings involving SCB and Community
Bank, see Salem Community Bancorp, Inc. and Subsidiary's Consolidated
Financial Statements, specifically in Note 8 - Commitments and
Contingent Liabilities, located elsewhere herein.

MARKET PRICE OF AND DIVIDENDS ON THE HOLDING COMPANY STOCK

There is no established public trading market for SCB Common. No
trades are known to have occurred during the years ended December 31,
1994, 1993, and 1992.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF SCB AND COMMUNITY BANK

INTRODUCTION

The following discussion and analysis is intended to review the
significant factors affecting the financial condition and results of
operations of SCB and its subsidiary, Community Bank, for the three-year
period ended December 31, 1993 and the nine months ended September 30,
1994 and 1993. It provides a more comprehensive review which is not
otherwise apparent from the consolidated financial statements alone.
Reference should be made to those statements and the selected financial
data presented elsewhere herein for an understanding of the following
review.

NET INCOME ANALYSIS

SCB's and Community Bank's net income for 1993 was $837,000 as
compared to $622,000 for 1992 and $429,000 for 1991. The increase in
net income for 1993 as compared to 1992 was due primarily to an increase
in net interest income of $346,000, partially offset by a $114,000
increase in noninterest expense. The increase in net income for 1992 as
compared to 1991 was primarily due to a $389,000 increase in net
interest income, partially offset by an increase in noninterest expense
in the amount of $83,000 and an increase in income tax expense in the
amount of $99,000.

For the nine months ended September 30, 1994, net income was
$642,000 as compared to net income of $640,000 for the nine months ended
September 30, 1993. The increase in net income was attributable to a
$94,000 increase in net interest income, a $20,000 reduction in the
provision for possible loan losses and a $43,000 increase in noninterest
income. This increase was offset by an increase in noninterest expense
in the amount of $141,000 and an increase in income tax expense in the
amount of $14,000.

NET INTEREST INCOME

Net interest income is the largest component of earnings and is
affected by the volume of the sources and uses of funds, the respective
rates earned and paid on those funds, the mix of those funds, and the
volume of nonperforming assets. SCB's and Community Bank's net interest
income increased 13.3% to $2,956,000 during 1993 after increases of
17.5% and 6.7% in 1992 and 1991, respectively. The net interest margin,
which is calculated by dividing tax-equivalent net interest income by
average interest-earning assets, was 4.36% in 1993 as compared to 4.10%
and 3.81% in 1992 and 1991, respectively. The increase in the

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72
net interest margin during 1993 primarily resulted from a change in the mix
of interest-earning assets, as SCB used maturing investments to fund
growth in the loan portfolio. The increase in the net interest margin
during 1992 primarily resulted from a $5,294,000 increase in average
interest-earning assets, offset by a $4,200,000 increase in average
interest-bearing liabilities. Additionally, the mix of interest-bearing
liabilities changed as maturing time deposits were reinvested in demand
deposit or savings accounts, which generally yield lower rates. As a
result, interest paid on liabilities decreased approximately $717,000
during 1992.

During 1993, increases in the average volume of loans and
nontaxable investment securities resulted in an increase in interest
income of $494,000. This increase was partially offset by a $70,000
decrease in interest income associated with a decrease in the average
volume of taxable investment securities, federal funds sold, and
interest-bearing deposits. Changes in interest rates on the average
volume of all interest earning assets reduced interest income $645,000.
Increases in the average balance of interest-bearing demand deposit
accounts, savings, and time deposits resulted in an increase in interest
expense of $153,000. This increase was partially offset by a $16,000
decrease in interest expense associated with a decrease in the average
balance of the note payable. Changes in interest rates on the average
volume of interest-bearing liabilities resulted in a decrease in
interest expense of $718,000. The net effect of the volume and rate
changes associated with all categories of interest-earning assets during
1993 as compared to 1992 lowered interest income $221,000, while the net
effect of the volume and rate changes associated with all categories of
interest-bearing liabilities lowered interest expense $581,000.

During 1992, increases in the average volume of loans and
investment securities resulted in an increase in interest income of
$434,000. Changes in interest rates on the average volume of loans,
taxable investment securities, federal funds sold, and interest-bearing
deposits resulted in a decrease in interest income of $744,000.
Increases in the average balance of interest-bearing demand deposit
accounts, savings, and time deposits resulted in an increase in interest
expense of $275,000. Changes in interest rates on the average volume of
interest-bearing liabilities resulted in a decrease in interest expense
of $973,000. The net effect of the volume and rate changes associated
with all categories of interest-earning assets during 1992 as compared
to 1991 lowered interest income $322,000, while the net effect of the
volume and rate changes associated with all categories of interest-
bearing liabilities lowered interest expense $717,000.

Net interest income was $2,275,000 for the first nine months of
1994, a 4.3% increase from the same period of 1993. Interest income
increased $46,000 for the first nine months of 1994 while interest
expense decreased $48,000. Average interest-bearing liabilities
increased 1.75% compared to an increase of 6.20% in average loan
balances for the same period in 1993, as a result of customer
refinancing of home mortgages and significant growth in the dealer loan
portfolio.

PROVISION FOR POSSIBLE LOAN LOSSES

The provision for possible loan losses charged to expense was
$110,000 in 1993 compared to $174,000 in 1992 and $165,000 in 1991.
Factors which influence management's determination of the provision for
loan losses include, among other things, evaluation of each
nonperforming, classified, and potential problem loan to determine the
estimated loss exposure based upon circumstances known to management;
current economic conditions and outlook; and an overall review of the
loan portfolio in light

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73
of past loss experience. The following table includes pertinent ratios which
describe trends in the allowance for possible loan losses during the
three-year period ended:

December 31,
--------------------------------------
1993 1992 1991
---- ---- ----

Nonperforming loans/loans .02% .33% 1.62%
Allowance for possible loan losses/loans 1.27 1.28 1.09
Allowance for possible loan losses/non-performing
loans 7,712.50 391.73 67.03
Net charge-offs/average loans 0.03 0.20 0.30

The decrease in nonperforming loans to loans since 1991 is a result
of a more aggressive approach to account collections coupled with
acquisitions of foreclosed real estate, primarily the foreclosure of
property with an outstanding balance of $105,000 in 1991. Net charge-
offs as a percentage of average loans decreased from .30% in 1991 to
.20% in 1992 and .03% in 1993.

The provision for possible loan losses was $70,000 in the first
nine months of 1994 compared to $90,000 in the same period for 1993.

NONINTEREST INCOME

SCB's and Community Bank's 1993 noninterest income was $499,000,
representing a 5.5% increase over 1992 results, while 1992 noninterest
income represented a decrease of 1.0% from 1991 results. Higher average
balances on commercial non-interest-bearing checking accounts resulted
in a 5.9% increase in service charge income for 1993 as compared to
1992. Other noninterest income, comprised mainly of miscellaneous fees
for bank services, increased by a combined 16.7% during 1993 compared to
a decrease of 4.4% during 1992. The increase from 1992 to 1993 is
primarily the result of significant increases in trust fees due to
increased volume and increases in safe deposit box fee income due to fee
increases.

Noninterest income for the first nine months of 1994 was $400,000,
an increase of $43,000 over the same period in 1993. This increase
primarily reflects a $28,000 increase in service charges on deposit
accounts and a $28,000 increase in other income, offset by a $13,000
decrease in security gains. The increase in service charges on deposit
accounts results from increased merchant fee income on credit card
transactions and increased charges on overdrafts. The increase in other
income is primarily attributable to a $16,000 increase in discount
brokerage income.

NONINTEREST EXPENSE

SCB's and Community Bank's noninterest expense increased 5.5% in
1993 and 4.1% in 1992. Salaries and employee benefits, the largest
component of noninterest expense, increased $50,000, or 5.2%, in 1993
and $27,000, or 2.9%, in 1992. These increases are attributed to normal
compensation increases and increases in health insurance and related
benefits. As a percentage of assets, total noninterest expense for 1993
was 2.8% compared to 2.9% in 1992 and 1991. Increases in F.D.I.C.
insurance assessments, advertising, occupancy, and furniture and
equipment expenses have contributed to the continued increases in other
noninterest expense categories.

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74

Noninterest expense was $1,706,000 in the first nine months of 1994
compared to $1,565,000 in the first nine months of 1993. Salaries and
benefits increased by $73,000 reflecting normal increases in
compensation and increases in health insurance and related benefits.
Furniture and equipment expenses increased $38,000 as a result of
increased equipment lease expenses.

INCOME TAXES

SCB and Community Bank recorded income tax expense of $309,000 for
1993, $202,000 for 1992, and $103,000 for 1991. Income tax expense of
$257,000 and $243,000 was recorded for the nine months ended
September 30, 1994 and 1993, respectively. The effective income tax
rate was 27.0%, 24.5%, and 19.4% for the years ended December 31, 1993,
1992, and 1991, respectively, and 28.5% and 27.5% for the nine months
ended September 30, 1994 and 1993, respectively. The increase in the
effective income tax rate is primarily a result of a reduction in the
percentage of nontaxable income on investment securities to income
before income taxes. See note 7 to the consolidated financial
statements with respect to the components of income taxes.

In February 1992, the Financial Accounting Standards Board (FASB)
issued Statement of Financial Accounting Standard (SFAS) No. 109,
"Accounting for Income Taxes." SFAS No. 109 is effective for fiscal
years beginning after December 15, 1992, and may be applied through
retroactive restatement of previously issued financial statements, or
through reporting the cumulative effect of applying the changes in the
period of its initial application. SCB and Community Bank implemented
SFAS No. 109 during the first quarter of 1993 on a prospective basis;
however, no adjustment was necessary to reflect the cumulative effect of
adoption in SCB's and Community Bank's 1993 consolidated statement of
income.

IMPACT OF NEW ACCOUNTING PRONOUNCEMENTS

During May 1993, the FASB issued SFAS Nos. 114 and 115, "Accounting
by Creditors for Impairment of a Loan," and "Accounting for Certain
Investments in Debt and Equity Securities," respectively. During
October 1994, the FASB issued SFAS No. 118, "Accounting by Creditors for
Impairment of a Loan - Income Recognition and Disclosures" which amends
SFAS 114.

SFAS No. 114 (as amended by SFAS No. 118) amends SFAS No. 5,
"Accounting for Contingencies," and SFAS No. 15, "Accounting by Debtors
and Creditors for Troubled Debt Restructurings." SFAS No. 114 defines
the recognition criterion for loan impairment and the measurement
methods for certain impaired loans and loans whose terms have been
modified in troubled debt restructurings ("a restructured loan").
Specifically, a loan is considered impaired when it is probable a
creditor will be unable to collect all amounts due - both principal and
interest - according to the contractual terms of the loan agreement.
When measuring impairment, the expected future cash flows of an impaired
loan are required to be discounted at the loan's effective interest
rate. Alternatively, impairment can be measured by reference to an
observable market price, if one exists, or the fair value of the
collateral for a collateral-dependent loan. Regardless of the
measurement method used historically, SFAS No. 114 requires a creditor
to measure impairment based on the fair value of the collateral when the
creditor determines foreclosure is probable. Additionally, impairment
of a restructured loan is measured by discounting the total expected
future cash flow at the loan's effective rate of interest as stated in
the original loan agreement. The impact of initially applying SFAS No.
114 will not be reported as an accounting change; rather, it will be
reported as a component of provision for possible loan losses. SFAS
No. 114 is effective for fiscal years beginning after December 15, 1994.
Management of SCB and Community Bank does not believe SFAS No. 114 will
have a material effect on SCB's and Community Bank's financial condition
when implemented.

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75

SFAS No. 118 amends SFAS No. 114 to allow a creditor to use
existing methods for recognizing interest income on an impaired loan.
Prior to the issuance of SFAS No. 118, SFAS No. 114 provided for two
alternative income recognition methods to be used to account for changes
in the net carrying amount of an impaired loan subsequent to the initial
measurement of impairment. Under the first income recognition method, a
creditor would accrue interest on the net carrying amount of the
impaired loan and report other changes in the net carrying amount of the
loan as an adjustment to bad-debt expense. Under the second income
recognition method, a creditor would recognize all changes in the net
carrying amount of the loan as an adjustment to bad-debt expense. While
those income recognition methods are no longer required, SFAS No. 118
does not preclude a creditor from using either of those methods. SFAS
No. 118 is effective concurrent with the effective date of SFAS No. 114,
that is, for financial statements for fiscal years beginning after
December 15, 1994.

SFAS No. 115 supersedes SFAS No. 12, "Accounting for Certain
Marketable Securities," and related Interpretations, and significantly
amends SFAS No. 65, "Accounting for Certain Mortgage Banking
Activities," and SFAS No. 60, "Accounting and Reporting by Insurance
Enterprises." SFAS No. 115 addresses the accounting and reporting for
investments in equity securities that have readily determinable fair
values, and all investments in debt securities. Under SFAS No. 115, an
enterprise is required to classify debt and equity securities into one
of three categories: held-to-maturity, available-for-sale, or trading.
Investments in debt securities are to be classified as held-to-maturity
and measured at amortized cost only if an enterprise has the positive
intent and ability to hold those securities to maturity. Securities
that are bought and held principally for the purpose of selling them in
the near-term are to be classified as trading securities. Finally,
investments not classified as held-to-maturity or trading securities are
to be classified as available-for-sale. Unrealized holding gains and
losses for trading securities (for which no securities were so
designated at December 31, 1993) are to be included in earnings, while
such gains and losses for available-for-sale securities are to be
excluded from earnings and reported as a net amount in a separate
component of stockholders' equity until realized. Unrealized holding
gains and losses for held-to-maturity securities are excluded from
earnings and stockholders' equity; however, such amounts are required to
be disclosed in the financial statements for each period in which a
statement of financial position is presented. For individual securities
classified as either available-for-sale or held-to-maturity, an
enterprise is required to report in earnings a decline in the fair value
of a security below its amortized cost which is determined to be other
than temporary (that is, accounted for as a realized loss). In this
event, the cost basis of the individual security is to be written down
to fair value as the new cost basis. Subsequent recoveries in the fair
value of the individual securities will not affect the new cost basis.
SFAS No. 115 is effective for fiscal years beginning after December 15,
1993 and may be implemented as of December 31, 1993.

Effective December 31, 1993, SCB and Community Bank adopted SFAS
No. 115, for which the cumulative effect was recorded on the balance
sheet on that date. On December 31, 1993, debt securities with an
amortized cost of $9,042,000 were classified as held-to-maturity
securities; debt and equity securities with an amortized cost of
$13,057,000 were classified as available-for-sale securities; a market
valuation account was established for the available-for-sale securities
of approximately $56,000, to increase the recorded balance of such
securities at December 31, 1993 to their fair value on that date; a
deferred tax liability of approximately $19,000 was recorded to reflect
the tax effect of the market valuation account; and the net increase
resulting from the market valuation adjustment at December 31, 1993 was
recorded as a separate component of stockholders' equity.

As of September 30, 1994, debt securities with an amortized cost of
$7,739,000 were classified as held-to-maturity securities; debt and
equity securities with an amortized cost of $12,944,000 were classified
as available-for-sale securities; the market valuation account for the
available-for-sale securities was adjusted to approximately ($259,000)
to decrease the recorded balance of such securities at September 30,
1994 to

69
76
their fair value on that date; the deferred tax liability was adjusted to a
deferred tax asset of approximately $88,000 to reflect the tax effect of
the market valuation account; and the net decrease of $171,000 resulting
from the market valuation adjustment at September 30, 1994 was recorded as
a separate component of stockholders' equity. The significant change in
the market valuation account and related components resulted from an
overall increase in the interest rate environment during the nine months
ended September 30, 1994, as a direct result of the Federal Reserve
increasing the discount interest rate.

During October 1994, the FASB issued SFAS No. 119, "Disclosure
about Derivative Financial Instruments and Fair Value of Financial
Instruments." SFAS No. 119 requires disclosures about amounts, nature,
and terms of derivative financial instruments that are not subject to
SFAS No. 105, "Disclosure of Information about Financial Instruments
with Off-Balance-Sheet Risk and Financial Instruments with
Concentrations of Credit Risk" because they do not result in off-
balance-sheet risk of accounting loss. SFAS No. 119 requires that a
distinction be made between financial instruments held or issued for
trading purposes and financial instruments held or issued for purposes
other than trading.

For entities that hold or issue derivative financial instruments
for trading purposes, SFAS No. 119 requires disclosure of:

* The average fair value of those derivative financial
instruments, presented together with the related end-of-period
fair value, distinguished between assets and liabilities; and

* Net trading gains or losses arising from trading activities,
including a description of the classes of derivative financial
instruments, other financial instruments, and non-financial
assets and liabilities from which the net trading gains or
losses arose.

For entities that hold or issue derivative financial instruments
for purposes other than trading, SFAS No. 119 requires disclosure of:

* A description of the entity's objectives for holding or issuing
the derivative financial instruments; and

* A description of how each class of derivative financial
instrument is reported in the financial statements.

For entities that hold or issue derivative financial instruments
and account for them as hedges of anticipated transactions, SFAS No. 119
requires disclosure of:

* A description of the anticipated transactions whose risks are
hedged;

* A description of the classes of derivative financial
instruments used to hedge the anticipated transactions;

* The amounts of hedging gains and losses explicitly deferred;
and

* A description of the transactions or other events that result
in the recognition in earnings of gains or losses deferred by
hedge accounting.

SFAS No. 119 also encourages, but does not require, quantitative
information about market risks of derivative financial instruments, and
also of other assets and liabilities, that is consistent with the way the

70
77
entity manages or adjusts risks and that is useful for comparing the
results of applying the entity's strategies to its objectives for
holding or issuing the derivative financial instruments.

SFAS No. 119 amends SFAS No. 105 to require disaggregation of
information about financial instruments with off-balance-sheet risk of
accounting loss by class, business activity, risk, or other category
that is consistent with the entity's management of those instruments.
SFAS No. 119 also amends SFAS No. 107, "Disclosure about Fair Value of
Financial Instruments," to require that fair value information be
presented without combining, aggregating, or netting the fair value of
derivative financial instruments with the fair value of nonderivative
financial instruments and be presented together with the related
carrying amounts in the body of the financial statements, a single
footnote, or a summary table in a form that makes it clear whether the
amounts represent assets or liabilities.

SFAS No. 119 is effective for financial statements issued for
fiscal years ending after December 15, 1994, except for entities with
less than $150 million in total assets. For those entities, SFAS
No. 119 is effective for financial statements issued for fiscal years
ending after December 15, 1995. Management of SCB and Community Bank
does not believe SFAS No. 119 will have a material effect on SCB's and
Community Bank's financial condition when implemented.

LIQUIDITY AND INTEREST RATE SENSITIVITY

SCB and Community Bank have in place an asset/liability management
committee whose objective is to manage rate sensitive earning assets and
interest-bearing liabilities. The asset/liability management process is
essential to minimize the risk that SCB and Community Bank have with
respect to exposure to interest rate changes and to minimize the effect
of interest rate fluctuations on net interest income.

Liquidity is provided to SCB and Community Bank through earning
assets including short-term investments in federal funds sold and
through maturities in the investment portfolio.

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78

The asset/liability management process, which involves management of
the components of the balance sheet to allow assets and liabilities to
reprice at approximately the same time, is a dynamic process essential to
minimizing the effect of interest rate fluctuations on net interest income.
The following table reflects SCB's and Community Bank's GAP analysis (rate
sensitive assets minus rate sensitive liabilities) as of December 31, 1993:

Over After one
3 months year
3 months through through After
or less 12 months five years five years Total
------- --------- ---------- ---------- -----
(Dollars in Thousands)

Assets:
Investments in debt securities $9,026 2,938 6,215 3,976 22,155
Loans 8,116 8,253 32,130 232 48,731
Federal funds sold 3,180 -- -- -- 3,180
------ ------ ------ ----- ------
Total interest-sensitive assets 20,322 11,191 38,345 4,208 74,066

Liabilities:
Money market deposits 15,875 -- -- -- 15,875
Savings and NOW accounts 9,693 -- -- -- 9,693
Time deposits 7,194 24,273 6,599 -- 38,066
Note payable 1,750 -- -- -- 1,750
------ ------ ------ ----- ------
Total interest-sensitive liabilities 34,512 24,273 6,599 -- 65,384
------ ------ ------ ----- ------

Interest-sensitivity gap at
December 31, 1993:
Incremental (14,190) (13,082) 31,746 4,208 8,682
====== ====== ====== ===== ======
Cumulative (14,190) (27,272) 4,474 8,682
====== ====== ====== =====

Interest-sensitivity gap at
September 30, 1994:
Incremental $(18,138) (9,705)
====== =====
Cumulative (18,138) (27,843)
====== ======

As is indicated in the preceding table, SCB and Community Bank were
liability sensitive on a cumulative basis in the near-term (12 months or
less) at December 31, 1993 based on contractual maturities. In this
regard, an increase in the general level of interest rates would generally
have a negative effect on SCB's and Community Bank's net interest income
as the repricing of the larger volume of interest sensitive liabilities
would create a larger amount of interest expense than the additional amount
of interest income created by the repricing of the smaller volume of
interest sensitive assets.

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79

The following table summarizes certain trends in SCB's balance sheet
during the three-year period ended:

December 31,
--------------------------------------------
1993 1992 1991
---- ---- ----
(Dollars in Thousands)

Total assets $78,510 72,663 69,847
Earnings assets 73,311 67,482 63,828
Deposits 72,067 66,828 64,342
Loans to deposits 65.77% 59.26% 58.95%
Loans to total assets 60.38 54.50 54.30
Debt securities to total assets 28.22 34.51 30.55
===== ===== =====

The composition of total assets and earning assets changed during 1993
as additional funds received from increased customer deposits and
investment maturities were used to fund loan growth. Loans, net of
unearned discount, were $47,401,000 at December 31, 1993 as compared to
$39,603,000 and $37,927,000 at December 31, 1992 and 1991, respectively,
while investment securities decreased to $22,155,000 at December 31, 1993
from $25,079,000 and $21,338,000 at December 31, 1992 and 1991,
respectively. The allocation of funds between balance sheet categories was
primarily a result of increased loan demand from the mortgage refinancing
market which peaked during 1993.

During 1992, the composition of total assets and earning assets
remained relatively unchanged. However, as discussed above, investment
securities and loans, net of unearned discount, increased $3,741,000 and
$1,676,000, respectively, during this period. The increase in these
earning assets resulted from increased customer deposits being invested in
investment securities as loan demand was lower during 1992 than during
1991. Additionally, SCB experienced a change in the deposit mix during
1992 as average interest-bearing demand, savings and market rate deposits
increased approximately $3,895,000, while average time deposits increased
approximately $505,000. This trend was primarily attributable to the lower
interest rate environment experienced during 1992 as maturing, longer-term
time deposits were reinvested in more liquid instruments.

SCB's and Community Bank's earning assets increased $944,000 from
December 31, 1993 to September 30, 1994 while total assets increased
$668,000 during the same period. Non-interest-bearing deposits increased
$897,000 while total deposits increased $206,000. The increase in deposits
during the first nine months of 1994 was largely due to seasonal deposits
in commercial accounts received by SCB and Community Bank and a
disintermediation of the interest-bearing bank instruments due to the
current rate environment. Investment securities decreased $1,731,000
during the first nine months of 1994 while loans increased $3,420,000 and
federal funds sold decreased $555,000. The primary source of liquidity for
the period resulted from management's determination not to reinvest
proceeds from maturing investment securities.

CAPITAL ADEQUACY

SCB's and Community Bank's equity capital was $4,511,000 at
September 30, 1994. This represented an increase of 10.6% over equity
capital at December 31, 1993 and resulted from net income for the first
nine months of 1994 of $642,000, offset by a $208,000 unrealized loss on
investment securities available-for-sale.

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80

SCB's equity capital was $4,077,000, $3,203,000, and $2,581,000 at
December 31, 1993, 1992, and 1991, respectively. During 1993, equity
capital increased $874,000, or 27.3%, as a result of net income of $837,000
and a $37,000 unrealized gain on investment securities available-for-sale.
During 1992, equity capital increased $622,000, or 24.1%. This increase
was solely attributable to net income.

Risk-based capital guidelines for financial institutions were adopted
by regulatory authorities effective January 1, 1991. These guidelines were
designed to relate regulatory capital requirements to the risk profile of
the specific institutions and to provide for uniform requirements among the
various regulators. Currently, the risk-based capital guidelines require
SCB and Community Bank to meet a minimum total capital ratio of 8.0% of
which at least 4.0% must consist of Tier 1 capital. Tier 1 capital
generally consists of (a) common stockholders' equity, (b) qualifying
perpetual preferred stock and related surplus subject to certain
limitations specified by the F.D.I.C., and (c) minority interests in the
equity accounts of consolidated securities less goodwill and any other
intangible assets and investments in subsidiaries that the F.D.I.C.
determines should be deducted from Tier 1 capital. The F.D.I.C. also
requires a minimum leverage ratio of 3.0%, defined as the ratio of Tier 1
capital less purchased mortgage servicing rights to total assets, for
banking organizations deemed the strongest and most highly rated by banking
regulators. A higher minimum leverage ratio is required of less highly
rated banking organizations.

The following table summarizes SCB's and Community Bank's risk-based
capital and leverage ratios:

Risk-Based Capital Ratios
- ---------------------------------------------------------------------------
Total Tier 1
- -------------------------------- ---------------------------------------
September 30, December 31, September 30, December 31,
1994 1993 1992 1994 1993 1992
---- ---- ---- ---- ---- ----

8.46% 8.28% 7.25% 7.34% 7.13% 6.16%

Leverage Ratios
----------------------------
September 30, 1994 December 31, 1993 December 31, 1992
------------------ ----------------- -----------------

5.64% 4.86% 4.08%

Additionally, financial analysts often track primary capital levels
as an indicator of capital adequacy. Primary capital includes equity
capital, allowance for possible loan losses, and debt considered equity for
regulatory capital purposes. Tangible primary capital represents primary
capital reduced by total intangible assets included in the balance sheet.
At December 31, 1993, SCB's and Community Bank's primary capital was
$3,816,000 compared to $2,965,000 and $2,333,000 at December 31, 1992 and
1991, respectively.

SCB's and Community Bank's primary capital to assets ratio was 5.93%,
5.13%, and 4.30% at December 31, 1993, 1992, and 1991, respectively.
Tangible primary capital at year-end 1993 was $4,433,000 as compared to
$3,486,000 and $2,758,000 at December 31, 1992 and 1991, respectively,
translating into tangible primary capital to assets ratio of 5.65%, 4.80%,
and 3.95% for the years then ended.

RISK MANAGEMENT

SCB's and Community Bank's management objective in structuring the
balance sheet is to maximize the return on stockholders' equity while
minimizing the associated risks. The major risks involved in the banking
industry are market, credit, and liquidity risks. The following is a
discussion of SCB's and Community Bank's management of these risks.

74
81

MARKET RISK MANAGEMENT

SCB's and Community Bank's management believes its loan and investment
portfolios are sufficiently diversified to minimize the effect of a
downturn in any particular industry or market.

SCB and Community Bank do not have any particular concentration of
credit in any one economic sector. However, $22,230,000, or 45.6%, of the
loan portfolio was concentrated and secured by real estate at December 31,
1993. The commercial loan portfolio which includes loans made primarily
to businesses located near and served by SCB and Community Bank, is
generally secured by business assets such as real estate, inventory,
accounts receivable and equipment. Of the $22,230,000 in loans secured by
real estate, $15,853,000, or 32.5%, of total loans are secured by one-to-
four-family residential mortgages. Consumer loans as of December 31, 1993
totaled $14,462,000, or 29.7%, of the loan portfolio. At December 31,
1993, the total investment portfolio was $22,155,000, a decrease of 11.7%
from the same period in 1992. Approximately 71.9% of the portfolio is
comprised of U.S. government issues.

CREDIT RISK MANAGEMENT

The risk SCB and Community Bank management assumes in providing credit
products to customers is fundamental to its business operation. Credit
risk management includes defining an acceptable level of risk and return,
establishing policies and procedures to govern the credit process, and
maintaining a thorough portfolio review function. Credit policies are
ultimately the responsibility of SCB's and Community Bank's Board of
Directors and, as such, are reviewed and approved by the Board of
Directors. Of equal importance in this risk management process are the
ongoing monitoring procedures performed by management.

Nonperforming loans declined to .02% of total loans at December 31,
1993 from .33% and 1.62% at December 31, 1992 and 1991, respectively.
Other real estate owned by SCB and Community Bank as a result of
foreclosure transactions was $0 at December 31, 1993 compared to $18,000
and $17,000 at December 31, 1992 and 1991, respectively.

LIQUIDITY RISK MANAGEMENT

Liquidity is a measurement of SCB's and Community Bank's ability to
meet the borrowing needs and the deposit withdrawal requirements of its
customers. SCB and Community Bank actively manage the composition of their
assets and liabilities to maintain the appropriate level of liquidity in
the balance sheet. Management is guided by regularly reviewed policies
when determining the appropriate portion of total assets which should be
comprised of readily marketable assets available to meet future liquidity
needs. Much of this liquidity risk management has been discussed
previously in connection with the liquidity and rate sensitivity.

EFFECT OF INFLATION

Persistent high rates of inflation can have a significant effect on
the reported financial condition and results of operations of all
industries. However, the asset and liability structure of commercial banks
is substantially different from that of an industrial company in that
virtually all assets and liabilities of commercial banks are monetary in
nature. Accordingly, changes in interest rates may have a significant
impact on a commercial bank's performance. Interest rates do not
necessarily move in the same direction or in the same magnitude as the
prices of goods and services.

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82

Inflation does have an impact on the growth of total assets in the
banking industry, often resulting in a need to increase equity capital at
higher than normal rates to maintain an appropriate equity to assets ratio.

Although it is obvious that inflation affects the growth of total
assets, it is difficult to measure the impact precisely. Only new assets
acquired in each year are directly affected, so a simple adjustment of
asset totals by use of an inflation index is not meaningful. The results
of operations also have been affected by inflation, but again, there is no
simple way to measure the effect on the various categories of income and
expense.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT OF SCB

The following table sets forth, as of September 30, 1994, the names
and addresses of each beneficial owner of more than five percent (5%) of
SCB Common known to the Board of Directors of SCB, showing the amount
of such beneficial ownership and the names of each director and
executive officer of SCB who owns shares of SCB Common, the number of
shares of SCB Common owned beneficially by each director and executive
officer and the number of shares of SCB Common owned beneficially by all
directors and executive officers as a group. None of the shareholders
listed herein would own, on a pro forma basis, giving effect to the Merger,
more than one percent (1%) of the issued and outstanding shares of
Boatmen's Common.

SHARES OF SCB COMMON
NAME AND ADDRESS BENEFICIALLY OWNED PERCENT OF CLASS
- ---------------- ------------------ ----------------

Glen L. Young
Route 50, R.R. 1
Odin, Illinois 62870 1,330 17.31%

S.M. Squibb
1715 Hawthorne Road
Salem, Illinois 62881 1,228 15.98

Gene L. Duncan
101 Lost Hollow Drive
Salem, Illinois 62881 1,133 14.74

Carl Y. Cantrell
P.O. Box 427
Salem, Illinois 62881 1,036 13.48

Jack D. Woods
1156 North Franklin
Salem, Illinois 62881 855 11.13

Robert W. Montgomery
234 Oak Tree
Salem, Illinois 62881 836 10.88

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83

SHARES OF SCB COMMON
NAME AND ADDRESS BENEFICIALLY OWNED PERCENT OF CLASS
- ---------------- ------------------ ----------------

Steven A. Jones
Route 4
Salem, Illinois 62881 633 8.24

A.P. Aguilar, M.D.
1665 Hawthorne
Salem, Illinois 62881 633 8.24

Directors and Executive Officers
of SCB as a Group (8 persons) 7,684 100.00%
===== ======

LEGAL OPINION

The legality of the securities offered hereby will be passed upon by
Lewis, Rice & Fingersh, L.C. Members of Lewis, Rice & Fingersh, L.C. and
attorneys employed by them owned, directly or indirectly, as of
November 30, 1994, 69,316 shares of Boatmen's Common.

EXPERTS

INDEPENDENT AUDITORS FOR BOATMEN'S

The consolidated financial statements of Boatmen's incorporated by
reference in Boatmen's Annual Report (Form 10-K) for the year ended
December 31, 1993 have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon included therein and
incorporated herein by reference. Such consolidated financial statements
are incorporated herein by reference in reliance upon such report given
upon the authority of such firm as experts in accounting and auditing.

The consolidated income statement and statements of changes in
shareholders' equity and cash flows of First Interstate of Iowa, Inc. and
subsidiaries for the year ended December 31, 1991, incorporated by
reference herein have been incorporated by reference herein in reliance
upon the report of KPMG Peat Marwick LLP, independent certified public
accountants, incorporated by reference herein, and upon the authority of
said firm as experts in accounting and auditing.

The consolidated statements of operations, changes in stockholders'
equity and cash flows of Sunwest Financial Services, Inc. and subsidiaries
for the year ended December 31, 1991, incorporated by reference herein have
been incorporated by reference herein in reliance upon the report of KPMG
Peat Marwick LLP, independent certified public accountants, incorporated
by reference herein, and upon the authority of said firm as experts in
accounting and auditing.

The consolidated statements of income, stockholders' equity and cash
flows of First Amarillo Bancorporation, Inc. and subsidiaries for the year
ended December 31, 1991, incorporated by reference herein have been
incorporated herein in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated by reference herein,
and upon the authority of said firm as experts in accounting and auditing.

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84

The consolidated balance sheets of Worthen and subsidiaries as of
December 31, 1993 and 1992 and the related consolidated statements of
earnings, stockholders' equity and cash flows for each of the years in the
three-year period ended December 31, 1993, incorporated by reference
herein, have been incorporated by reference herein in reliance upon the
reports of KPMG Peat Marwick LLP and Frost & Company, independent certified
public accountants, incorporated by reference herein, and upon the
authority of said firms as experts in accounting and auditing. The report
of KPMG Peat Marwick LLP refers to a change in the method of accounting for
income taxes in 1993.

INDEPENDENT AUDITORS FOR SCB

The consolidated financial statements of SCB at December 31, 1993 and
for the year then ended appearing in this Proxy Statement/Prospectus and
Registration Statement have been audited by KPMG Peat Marwick LLP,
independent certified public accountants, as set forth in their report
thereon appearing elsewhere herein, and are included in reliance upon such
report given upon the authority of such firm as experts in accounting and
auditing. The report of KPMG Peat Marwick LLP refers to a change in the
method of accounting for investments in debt and marketable equity
securities in 1993 and a change in the method of accounting for income
taxes in 1993.

PRESENCE AT SPECIAL MEETING

Representatives of KPMG Peat Marwick LLP are expected to be present
at the Special Meeting with the opportunity to make a statement if they
desire to do so and to respond to appropriate questions.

SHAREHOLDER PROPOSALS

Shareholder proposals for the annual meeting of Boatmen's shareholders
to be held in April, 1995 must have been received by Boatmen's by November
11, 1994. In order to be considered for inclusion in the 1995 proxy
statement, shareholder proposals for the 1996 annual meeting of Boatmen's
must be received by Boatmen's on a date to be determined and announced in
Boatmen's proxy statement for its 1995 annual meeting, and must meet the
requirements established by the S.E.C. for shareholder proposals.

Upon receipt of any such proposal Boatmen's will determine whether or
not to include such proposal in the Proxy Statement and proxies in
accordance with the S.E.C.'s regulations governing the solicitation of
proxies.

---------------

78
85

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

Consolidated Financial Statements

December 31, 1993

(With Independent Auditors' Report Thereon)

F-1
86
INDEPENDENT AUDITORS' REPORT

The Board of Directors and Stockholders
Salem Community Bancorp, Inc.:

We have audited the accompanying consolidated balance sheet of
Salem Community Bancorp, Inc. and subsidiary as of December 31,
1993, and the related consolidated statements of income,
stockholders' equity, and cash flows for the year then ended.
These consolidated financial statements are the responsibility of
Salem Community Bancorp, Inc. management. Our responsibility is to
express an opinion on these consolidated financial statements based
on our audit.

We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated
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 our audit provides 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 Salem Community Bancorp Inc. and subsidiary as of
December 31, 1993, and the results of their operations and their
cash flows for the year then ended, in conformity with generally
accepted accounting principles.

As discussed in notes 1 and 2 to the consolidated financial
statements, Salem Community Bancorp, Inc. and subsidiary changed
their method of accounting for investments in debt and marketable
equity securities to adopt the provisions of the Financial
Accounting Standards Board's Statement of Financial Accounting
Standards No. 115, Accounting for Certain Investments in Debt and
Equity Securities, on December 31, 1993. As discussed in notes 1
and 7, Salem Community Bancorp, Inc. and subsidiary changed their
method of accounting for income taxes in 1993 to adopt the
provisions of the Financial Accounting Standards Board's Statement
of Financial Accounting Standards No. 109, Accounting for Income
Taxes.

/s/ KPMG Peat Marwick LLP

St. Louis, Missouri
October 14, 1994

F-2
87

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

SEPTEMBER 30, 1994 AND DECEMBER 31, 1993
AND 1992
(dollars expressed in thousands, except share data)

SEPTEMBER 30, DECEMBER 31,
------------- ------------------
1994 1993 1992
---- ---- ----
(UNAUDITED) (UNAUDITED)

ASSETS
Cash and due from banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,061 3,413 3,102
Interest-bearing deposits with other financial institutions . . . . . . . . . . . . . . 385 575 775
Federal funds sold. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,625 3,180 2,025
------ ------ ------
CASH AND CASH EQUIVALENTS. . . . . . . . . . . . . . . . . . . . . . . . . 6,071 7,168 5,902
------ ------ ------
Investment securities available-for-sale, at fair value . . . . . . . . . . . . . . . . 12,685 13,113 --
Investment securities held-to-maturity (estimated market
value of $8,098, $9,197 and $25,376 at September 30,
1994 and December 31, 1993 and 1992, respectively). . . . . . . . . . . . . . . . . . 7,739 9,042 25,079
Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52,260 48,731 40,763
Less:
Unearned discount. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,439 1,330 1,160
Allowance for possible loan losses . . . . . . . . . . . . . . . . . . . . . . . 678 617 521
------ ------ ------
LOANS, NET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,143 46,784 39,082
------ ------ ------
Office properties, furniture, and equipment, net of
accumulated depreciation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,545 1,595 1,645
Other real estate owned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- -- 18
Accrued interest receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 615 499 586
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 380 309 351
------ ------ ------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $79,178 78,510 72,663
====== ====== ======
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest-bearing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,330 8,433 8,093
Interest-bearing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62,943 63,634 58,735
------ ------ ------
TOTAL DEPOSITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72,273 72,067 66,828
Accrued interest payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 296 222 234
Note payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,700 1,750 2,000
Minority interest in subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . 233 194 201
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165 200 197
------ ------ ------
TOTAL LIABILITIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74,667 74,433 69,460
------ ------ ------
Stockholders' equity:
Common stock, $1 par value, 10,000 shares
authorized; 7,684 shares issued and outstanding . . . . . . . . . . . . . . . . . . 8 8 8
Surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 766 766 766
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,908 3,266 2,429
Unrealized gain (loss) on securities available-for-sale,
net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (171) 37 --
----- ----- -----
TOTAL STOCKHOLDERS' EQUITY . . . . . . . . . . . . . . . . . . . . . . . . 4,511 4,077 3,203
------ ------ ------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $79,178 78,510 72,663
====== ====== ======

See accompanying notes to consolidated financial statements.

F-3
88

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF INCOME

NINE MONTHS ENDED SEPTEMBER 30, 1994 AND
1993 AND YEARS ENDED DECEMBER 31,
1993, 1992, AND 1991
(dollars expressed in thousands, except share data)

SEPTEMBER 30, DECEMBER 31,
-------------- ---------------------
1994 1993 1993 1992 1991
---- ---- ---- ---- ----
(UNAUDITED) (UNAUDITED)

Interest income:
Interest and fees on loans. . . . . . . . . . . . . . . . . . . . . . . . . . . $3,061 2,780 3,779 3,738 4,010
Interest on investment securities:
Taxable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 586 808 1,034 1,281 1,233
Nontaxable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 188 199 265 238 242
Interest on federal funds sold. . . . . . . . . . . . . . . . . . . . . . . . . 83 77 107 137 228
Interest-bearing deposits with other financial institutions . . . . . . . . . . 27 35 46 72 81
----- ----- ----- ----- -----
TOTAL INTEREST INCOME. . . . . . . . . . . . . . . . . . . . . . . . 3,945 3,899 5,231 5,466 5,794
----- ----- ----- ----- -----
Interest expense:
Interest on deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,590 1,629 2,157 2,711 3,349
Interest on note payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . 80 89 118 145 224
----- ----- ----- ----- -----
TOTAL INTEREST EXPENSE . . . . . . . . . . . . . . . . . . . . . . . 1,670 1,718 2,275 2,856 3,573
----- ----- ----- ----- -----
NET INTEREST INCOME. . . . . . . . . . . . . . . . . . . . . . . . . 2,275 2,181 2,956 2,610 2,221
Provision for possible loan losses. . . . . . . . . . . . . . . . . . . . . . . . 70 90 110 174 165
----- ----- ----- ----- -----
NET INTEREST INCOME AFTER PROVISION FOR POSSIBLE LOAN
LOSSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,205 2,091 2,846 2,436 2,056
----- ----- ----- ----- -----
Noninterest income:
Service charges on deposit accounts . . . . . . . . . . . . . . . . . . . . . . 287 259 360 340 350
Security gains. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- 13 13 25 15
Other income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113 85 126 108 113
----- ----- ----- ----- -----
TOTAL NONINTEREST INCOME . . . . . . . . . . . . . . . . . . . . . . 400 357 499 473 478
----- ----- ----- ----- -----
Noninterest expense:
Salaries and employee benefits. . . . . . . . . . . . . . . . . . . . . . . . . 821 748 1,003 953 926
Occupancy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113 114 151 147 134
Furniture and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183 145 200 187 173
Federal Deposit Insurance Corporation assessment. . . . . . . . . . . . . . . . 120 114 152 145 136
Directors and committee fees. . . . . . . . . . . . . . . . . . . . . . . . . . 51 51 156 138 122
Postage, printing, and supplies . . . . . . . . . . . . . . . . . . . . . . . . 109 101 138 132 134
Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57 58 85 52 51
Other expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 252 234 314 331 326
----- ----- ----- ----- -----
TOTAL NONINTEREST EXPENSE. . . . . . . . . . . . . . . . . . . . . . 1,706 1,565 2,199 2,085 2,002
----- ----- ----- ----- -----
INCOME BEFORE INCOME TAX EXPENSE . . . . . . . . . . . . . . . . . . 899 883 1,146 824 532
Income tax expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 257 243 309 202 103
----- ----- ----- ----- -----
NET INCOME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 642 640 837 622 429
===== ===== ===== ===== =====
SHARE DATA:
Average common shares outstanding . . . . . . . . . . . . . . . . . . . . . . . 7,684 7,684 7,684 7,684 7,684
===== ===== ===== ===== =====
Earnings per common share . . . . . . . . . . . . . . . . . . . . . . . . . . . $83.55 83.29 108.93 80.95 55.83
===== ===== ====== ===== =====

See accompanying notes to consolidated financial statements.

F-4
89

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

NINE MONTHS ENDED SEPTEMBER 30, 1994
AND YEARS ENDED DECEMBER 31,
1993, 1992, AND 1991

(dollars expressed in thousands)

Unrealized
gain (loss)
on
securities
available-
Common Retained for-
stock Surplus earnings sale, net Total
----- ------- -------- --------- -----

BALANCE AT DECEMBER 31, 1990 (UNAUDITED). . . . . . . . . . $ 8 766 1,378 --- 2,152
Net income (unaudited). . . . . . . . . . . . . . . . . . . --- --- 429 --- 429
----- ----- ----- ----- -----
BALANCE AT DECEMBER 31, 1991 (UNAUDITED). . . . . . . . . . 8 766 1,807 --- 2,581
Net income (unaudited). . . . . . . . . . . . . . . . . . . --- --- 622 --- 622
----- ----- ----- ----- -----
BALANCE AT DECEMBER 31, 1992 (UNAUDITED). . . . . . . . . . 8 766 2,429 --- 3,203
Net income. . . . . . . . . . . . . . . . . . . . . . . . . --- --- 837 --- 837
Unrealized gain on securities available-for-
sale, net. . . . . . . . . . . . . . . . . . . . . . . . . --- --- --- 37 37
----- ----- ----- ----- -----
BALANCE AT DECEMBER 31, 1993. . . . . . . . . . . . . . . . 8 766 3,266 37 4,077
Net income (unaudited). . . . . . . . . . . . . . . . . . . --- --- 642 --- 642
Unrealized loss on securities available-for-
sale, net (unaudited) . . . . . . . . . . . . . . . . . . --- --- --- (208) (208)
----- ----- ----- --- ---
BALANCE AT SEPTEMBER 30, 1994 (UNAUDITED) . . . . . . . . . $ 8 766 3,908 (171) 4,511
===== === ===== === =====

See accompanying notes to consolidated financial statements.

F-5
90

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED SEPTEMBER 30, 1994 AND
1993 AND YEARS ENDED DECEMBER 31,
1993, 1992, AND 1991
(dollars expressed in thousands)

SEPTEMBER 30, DECEMBER 31,
------------- --------------------
1994 1993 1993 1992 1991
---- ---- ---- ---- ----
(UNAUDITED) (UNAUDITED)

Cash flows from operating activities:
Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 642 640 837 622 429
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization, net of accretion. . . . . . . . . . . . . . . . . 128 133 184 188 115
Provision for possible loan losses . . . . . . . . . . . . . . . . . . . . . . . 70 90 110 174 165
Decrease (increase) in accrued interest receivable . . . . . . . . . . . . . . . (116) (94) 87 89 45
Increase (decrease) in accrued interest payable. . . . . . . . . . . . . . . . . 74 9 (12) (120) (72)
Loss on disposal of fixed assets . . . . . . . . . . . . . . . . . . . . . . . . -- -- -- -- 21
Net change in other assets and liabilities . . . . . . . . . . . . . . . . . . . 32 72 12 80 9
Gain on sale of other real estate. . . . . . . . . . . . . . . . . . . . . . . . -- (4) (4) -- --
Gain on sale of investment securities. . . . . . . . . . . . . . . . . . . . . . -- (13) (13) (25) (15)
Other operating activities, net. . . . . . . . . . . . . . . . . . . . . . . . . 2 1 9 14 3
---- ---- ---- ---- ----
NET CASH PROVIDED BY OPERATING
ACTIVITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 832 834 1,210 1,022 700
----- ----- ----- ----- -----
Cash flows from investing activities:
Purchase of investment securities . . . . . . . . . . . . . . . . . . . . . . . . . . (3,828) (3,786) (5,989) (12,407) (10,341)
Proceeds from maturities of investment securities . . . . . . . . . . . . . . . . . . 3,345 3,036 4,794 3,085 4,332
Proceeds from sales of investment securities. . . . . . . . . . . . . . . . . . . . . -- 273 273 1,001 369
Principal payments on mortgage-backed securities. . . . . . . . . . . . . . . . . . . 1,839 2,887 3,824 4,491 1,704
Net increase in loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,433) (5,451) (7,821) (1,809) (1,887)
Recoveries of loans previously charged off. . . . . . . . . . . . . . . . . . . . . . 4 8 9 18 24
Proceeds from sale of foreclosed real estate. . . . . . . . . . . . . . . . . . . . . -- 22 22 55 142
Purchase of additional shares of subsidiary stock . . . . . . . . . . . . . . . . . . -- -- (8) (4) --
Purchases of office properties, furniture and equipment . . . . . . . . . . . . . . . (12) (28) (37) (46) (20)
----- ----- ----- ----- -----
NET CASH USED IN INVESTING
ACTIVITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,085) (3,039) (4,933) (5,616) (5,677)
----- ----- ----- ----- -----
Cash flows from financing activities:
Net increase in deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206 3,644 5,239 2,486 4,835
Repayments of note payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (50) (125) (250) (250) (150)
----- ----- ----- ----- -----
NET CASH PROVIDED BY FINANCING
ACTIVITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156 3,519 4,989 2,236 4,685
----- ----- ----- ----- -----
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS . . . . . . . . . . . . . . . . . . . . . . . . . . (1,097) 1,314 1,266 (2,358) (292)
Cash and cash equivalents, beginning of period. . . . . . . . . . . . . . . . . . . . . 7,168 5,902 5,902 8,260 8,552
----- ----- ----- ----- -----
Cash and cash equivalents, end of period. . . . . . . . . . . . . . . . . . . . . . . . $ 6,071 7,216 7,168 5,902 8,260
===== ===== ===== ===== =====
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 331 294 354 144 130
Interest on deposits and notes payable. . . . . . . . . . . . . . . . . . . . . . . 1,596 1,709 2,287 2,976 3,645
Noncash:
Loans transferred to foreclosed real estate . . . . . . . . . . . . . . . . . . . . -- -- -- 56 159
Loans to facilitate sale of foreclosed real estate. . . . . . . . . . . . . . . . . -- -- -- 41 40
Transfer of investment securities to available-for-sale . . . . . . . . . . . . . . -- -- 13,057 -- --
===== ===== ====== ===== =====

See accompanying notes to consolidated financial statements.

F-6
91

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 1993 (AUDITED), 1992, AND 1991 (UNAUDITED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BUSINESS
--------

Salem Community Bancorp, Inc. and subsidiary (the Company)
provides a full range of banking services to individual and
corporate customers through its subsidiary bank located in Salem,
Illinois. The Company is subject to competition from other
financial institutions and is subject to the regulations of
certain federal and state agencies which perform periodic
examinations.

BASIS OF FINANCIAL STATEMENT PRESENTATION
-----------------------------------------

The consolidated financial statements of the Company have
been prepared in conformity with generally accepted accounting
principles. In preparing the consolidated financial statements,
management is required to make estimates and assumptions which
significantly affect the reported amounts in the consolidated
financial statements. The most significant estimate, which is
particularly susceptible to significant change in the near-term,
relates to the determination of the allowance for possible loan
losses. The more significant accounting policies used by the
Company in the accompanying consolidated financial statements are
summarized below:

PRINCIPLES OF CONSOLIDATION
---------------------------

The consolidated financial statements include the accounts
of the Company and its subsidiary, Community State Bank (the
Bank), of which the Company owns 96.37% of the outstanding common
stock. All significant intercompany balances and transactions
have been eliminated.

CASH AND CASH EQUIVALENTS
-------------------------

For purposes of the consolidated statements of cash flows,
cash and cash equivalents is defined as cash and due from banks,
interest-bearing deposits with other financial institutions, and
federal funds sold.

INVESTMENT SECURITIES
---------------------

Effective December 31, 1993, the Company adopted the
Financial Accounting Standards Board's (FASB) Statement of
Financial Accounting Standards No. 115, Accounting for Certain
Investments in Debt and Equity Securities (SFAS 115). SFAS 115
addresses the accounting and reporting for investments in equity
securities that have readily determinable fair values, and all
investments in debt securities. Under SFAS 115, the Company is
required to classify debt and equity securities into one of three
categories:

(Continued)

F-7
92

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Available-for-Sale - includes debt and equity securities not
classified as held-to-maturity or trading, i.e., investments
which the Company has no present plans to sell in the near-
term but may be sold in the future under different
circumstances.

Held-to-Maturity - includes debt securities which the
Company has the positive intent and ability to hold until
maturity.

Trading - includes debt and equity securities purchased and
held principally for the purpose of selling them in the
near-term.

Debt securities classified as held-to-maturity are measured
at amortized cost, in which the amortization of premiums and
accretion of discounts is recorded using the level-yield method.
Unrealized holding gains and losses for trading securities (for
which no securities were so designated at December 31, 1993) are
to be included in earnings, while such gains and losses for
available-for-sale securities are to be excluded from earnings
and reported as a net amount in a separate component of
stockholders' equity until realized. Unrealized holding gains
and losses for held-to-maturity securities are to be excluded
from earnings and stockholders' equity. For available-for-sale
securities, gains or losses realized are included in other
noninterest income upon sale, based on the amortized cost of the
individual security sold. All previous fair value adjustments
included in the separate component of stockholders' equity are
reversed upon sale.

Prior to December 31, 1993, investments in debt securities
were stated at cost, adjusted for amortization of premiums and
accretion of discounts. Mortgage-backed securities were carried
at their outstanding principal balance, adjusted for amortization
of premiums and accretion of discounts considering the level of
current and anticipated repayments. Amortization and accretion
was recorded using the level-yield method. Investments in equity
securities were carried at the lower of aggregate cost or market
value. Gains or losses were recognized upon realization and were
shown separately in the consolidated statements of income and the
cost of the securities sold was based on a specific
identification method.

LOANS
-----

The Company grants commercial, real estate mortgage, and
consumer loans primarily to customers in the Company's immediate
geographic lending area. The Company has a diversified loan
portfolio and has no concentrations of credit in any specific
industry.

Loans receivable are carried at cost, adjusted for
amortization of premiums and accretion of discounts using a
method which approximates the level-yield method. Interest and
fees on loans are recorded in income using the interest method.
Loans receivable are stated at cost as the Company has the
ability and it is management's intent to hold them to maturity.
The accrual of interest is discontinued when management believes
interest or principal may not be paid in a timely manner in the
normal course of business. Generally, payments received on
nonaccrual loans are recorded as principal reductions.

(Continued)

F-8
93

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Interest income is recognized after all principal has been repaid or an
improvement in the condition of the loan has occurred which would
warrant resumption of interest accruals.

The allowance for possible loan losses is maintained at a
level considered adequate to provide for potential losses. The
provision for possible loan losses is based on a periodic
analysis, considering, among other factors, current economic
conditions, loan portfolio composition, past loan loss
experience, independent appraisals, loan collateral, and payment
experience. In addition to the allowance for estimated losses on
identified problem loans, an overall unallocated allowance is
established to provide for unidentified credit losses inherent in
the portfolio. As adjustments become necessary, they are
reflected in the results of operations in the periods in which
they become known.

While management uses available information to recognize
losses on loans, future additions to the allowance may be
necessary based on changes in economic conditions. In addition,
various regulatory agencies, as an integral part of the
examination process, periodically review the allowance for
possible loan losses of the Company. Such agencies may require
the Company to increase its allowance for possible loan losses
based on their judgments about information available to them at
the time of their examinations.

During May 1993, the FASB issued Statement of Financial
Accounting Standards No. 114, Accounting by Creditors for
Impairment of a Loan (SFAS 114). SFAS 114 defines the
recognition criteria for loan impairment and the measurement
methods for certain impaired loans and loans for which terms have
been modified in troubled-debt restructurings (a restructured
loan). Specifically, a loan will be considered impaired when it
is probable a creditor will be unable to collect all amounts
due - both principal and interest - according to the contractual
terms of the loan agreement. When measuring impairment, the
expected future cash flows of an impaired loan will be required
to be discounted at the loan's effective interest rate.
Alternatively, impairment could be measured by reference to an
observable market price, if one exists, or the fair value of the
collateral for a collateral-dependent loan. Regardless of the
historical measurement method used, SFAS 114 will require a
creditor to measure impairment based on the fair value of the
collateral when the creditor determines foreclosure is probable.
Additionally, impairment of a restructured loan will be measured
by discounting the total expected future cash flows at the loan's
effective rate of interest as stated in the original loan
agreement. The impact of initially applying SFAS 114 will not be
reported as an accounting change; rather, it will be reported as
a component of the provision for possible loan losses charged to
operations. SFAS 114 is effective for fiscal years beginning
after December 15, 1994. The Company does not believe SFAS 114
will have a material effect on its financial condition when
implemented.

OFFICE PROPERTIES, FURNITURE, AND EQUIPMENT
-------------------------------------------

Office properties, furniture, and equipment are stated at
cost less accumulated depreciation and amortization.
Depreciation and amortization is computed primarily using the
straight-line method over the estimated useful lives of the
related assets. Office properties and improvements are
depreciated over five to 50 years and furniture and equipment
over five to 20 years. Expenditures for major renewals and

(Continued)

F-9
94

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

betterments of office properties, furniture, and equipment are
capitalized, and those for maintenance and repairs are expensed
as incurred.

OTHER REAL ESTATE OWNED
-----------------------

Other real estate, consisting of real estate acquired
through foreclosure or deeded in lieu of foreclosure, is stated
at the lower of fair value less applicable selling costs or cost
at the time the property is acquired. The excess of cost over
fair value of other real estate at the date of acquisition is
charged to the allowance for possible loan losses. Subsequent
reductions in carrying value to reflect a reduction in current
fair value or costs incurred in maintaining the properties are
charged to expense as incurred.

Gains on sales of other real estate owned are recognized
when the title has passed to the purchaser, minimum down payment
requirements have been met, the terms of any notes received by
the Company satisfy continuing payment requirements, and the
Company is relieved of any requirement for continued involvement
in the properties.

INCOME TAXES
------------

The Company and the Bank file consolidated federal income
tax returns.

In February 1992, the FASB issued Statement of Financial
Accounting Standards No. 109, Accounting for Income Taxes (SFAS
109). SFAS 109 requires a change from the deferred method of
accounting for income taxes pursuant to APB Opinion 11 to the
asset and liability method of accounting for income taxes. Under
the asset and liability method of SFAS 109, deferred tax assets
and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their
respective tax bases. Deferred tax assets and liabilities are
measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are
expected to be recovered or settled. Under SFAS 109, the effect
on deferred tax assets and liabilities of a change in tax rates
is recognized in income in the period that includes the enactment
date.

Effective January 1, 1993, the Company adopted SFAS 109;
however, no adjustment was necessary to reflect the cumulative
effect of adoption in the Company's 1993 consolidated statement
of income.

Pursuant to the deferred method under APB Opinion 11, which
was applied in 1992 and prior years, deferred income taxes were
recognized for income and expense items that were reported in
different years for financial reporting purposes and income tax
purposes using the tax rate applicable for the year of the
calculation. Under the deferred method, deferred taxes are not
adjusted for subsequent changes in tax rates.

(Continued)

F-10
95

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

EARNINGS PER COMMON SHARE
-------------------------

Earnings per common share data is calculated using the
weighted average number of shares of common stock outstanding
during each period.

2. INVESTMENTS IN DEBT AND MARKETABLE EQUITY SECURITIES

Effective December 31, 1993, the Company adopted SFAS 115,
for which the cumulative effect was recorded on the consolidated
balance sheet on that date. On December 31, 1993, debt
securities with an amortized cost of $9,042,000 were classified
as held-to-maturity securities; debt and equity securities with
an amortized cost of $13,057,000 were classified as available-
for-sale securities; a market valuation account was established
for the available-for-sale securities of approximately $56,000,
to increase the recorded balance of such securities at
December 31, 1993 to their fair value on that date; a deferred
tax liability of approximately $19,000 was recorded to reflect
the tax effect of the market valuation account; and the net
increase resulting from the market valuation adjustment at
December 31, 1993 was recorded as a separate component of
stockholders' equity.

The amortized cost and estimated market values of debt and
equity securities classified as available-for-sale at
December 31, 1993 are as follows:

Gross Gross Estimated
Amortized unrealized unrealized market
cost gains losses value
---- ----- ------ -----
(dollars expressed in thousands)

U.S. Treasury securities and obligations of
U.S. government corporations and agencies . . . . . . . . . . . . . . . . . . . $ 12,266 91 (39) 12,318
Other debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 791 5 (1) 795
------ -- -- ------
$ 13,057 96 (40) 13,113
====== == == ======

The amortized cost and estimated market values of debt and
equity securities classified as held-to-maturity at December 31,
1993 are as follows:

Gross Gross Estimated
Amortized unrealized unrealized market
cost gains losses value
---- ----- ------ -----
(dollars expressed in thousands)

U.S. Treasury securities and obligations of
U.S. government corporations and agencies . . . . . . . . . . . . . . . . . . . $ 3,622 67 (1) 3,688
Obligations of states and political subdivisions. . . . . . . . . . . . . . . . . 5,282 95 (5) 5,372
Other debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138 -- (1) 137
----- --- -- -----
$ 9,042 162 (7) 9,197
===== === = =====

(Continued)

F-11
96

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The amortized cost and estimated market value of investment
securities at December 31, 1993 by contractual maturity, are
shown below. Expected maturities will differ from contractual
maturities because borrowers may have the right to call or prepay
obligations with or without call or prepayment penalties.

Available-for-sale Held-to-maturity
------------------ ----------------
Estimated Estimated
Amortized market Amortized market
cost value cost value
---- ----- ---- -----
(dollars expressed in thousands)

Due in one year or less . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 404 410 2,549 2,577
Due after one year through five years . . . . . . . . . . . . . . . . . . . . 6,656 6,640 4,834 4,913
Due after five years through ten years. . . . . . . . . . . . . . . . . . . . 416 419
Due after ten years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- -- -- --
------ ------ ----- -----
7,060 7,050 7,799 7,909
Mortgage-backed securities. . . . . . . . . . . . . . . . . . . . . . . . . . 5,997 6,063 1,243 1,288
------ ------ ----- -----
$ 13,057 13,113 9,042 9,197
====== ====== ===== =====

The amortized cost and estimated market values of investment
securities at December 31, 1992 were as follows:

Gross Gross Estimated
Amortized unrealized unrealized market
cost gains losses value
---- ----- ------ -----
(dollars expressed in thousands)

U.S. Treasury securities and obligations of
U.S. government corporations and agencies . . . . . . . . . . . . . . . . . . . $ 18,149 252 (56) 18,345
Obligations of states and political subdivisions. . . . . . . . . . . . . . . . . 5,065 111 (10) 5,166
Other debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,865 5 (5) 1,865
------ --- --- ------
$ 25,079 368 (71) 25,376
====== === == ======

Proceeds from sales of investment securities were $273,000,
$1,001,000, and $369,000 for the years ended December 31, 1993,
1992, and 1991, respectively. Gross gains realized on those
sales were $13,000, $25,000, and $15,000 for the years ended
December 31, 1993, 1992, and 1991, respectively. There were no
losses realized on sales of investment securities for the years
ended December 31, 1993, 1992 and 1991.

Investment securities with a carrying value of approximately
$5,382,000 and $4,974,000 at December 31, 1993 and 1992,
respectively, were pledged to secure public funds and for other
purposes as required or permitted by law.

(Continued)

F-12
97

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

3. LOANS

Loans, by category, at December 31, 1993 and 1992 are
summarized as follows:

1993 1992
---- ----
(dollars expressed in thousands)

Commercial, financial, and agricultural . . . . . . . . . . . . . . . . . . . . . . . . $ 12,039 10,309
Real estate:
Commercial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,475 4,770
Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 902 676
Residential. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,853 13,656
Consumer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,409 10,425
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,053 927
------ ------
$48,731 40,763
====== ======

Changes in the allowance for possible loan losses for the
years ended December 31, 1993, 1992, and 1991 are as follows:

1993 1992 1991
---- ---- ----
(dollars expressed in thousands)

Balance at beginning of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 521 425 370
Provisions charged to expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 174 165
Loans charged off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (23) (96) (134)
Recoveries. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 18 24
--- --- ---
Balance at end of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 617 521 425
=== === ===

There were no loans on nonaccrual status at December 31, 1993.

Nonaccruing loans aggregated $111,000 at December 31, 1992.
Interest on nonaccrual loans, which would have been recorded
under the original terms of the loans, was approximately $11,000
for the year ended December 31, 1992.

Aggregate loan transactions involving executive officers and
directors of the Company for the year ended December 31, 1993 are
summarized as follows (dollars expressed in thousands):

Aggregate balance, December 31, 1992. . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,405
New loans and advances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,670
Repayments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,241)
-----
Aggregate balance, December 31, 1993. . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,834
=====

(Continued)

F-13
98
SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Such loans were made in the ordinary course of business at
normal credit terms, including interest rates and collateral,
prevailing at the time for comparable transactions with unrelated
parties, and do not involve more than normal risk of collection.

4. OFFICE PROPERTIES, FURNITURE, AND EQUIPMENT

Office properties, furniture, and equipment were comprised of
the following at December 31, 1993 and 1992:

1993 1992
---- ----
(dollars expressed
in thousands)

Land and land improvements. . . . . . . . . . . . . . . . . . . $ 425 425
Buildings and improvements. . . . . . . . . . . . . . . . . . . 1,624 1,623
Furniture, fixtures, and equipment. . . . . . . . . . . . . . . 513 477
----- -----
2,562 2,525

Less accumulated depreciation and amortization. . . . . . . . . 967 880
----- -----
$ 1,595 1,645
===== =====

Depreciation and amortization expense for the years ended
December 31, 1993, 1992, and 1991 was approximately $87,000,
$87,000, and $75,000, respectively.

The Company has entered into certain lease agreements for
computer equipment under a five-year lease agreement, expiring
December 30, 1995. The leases provide for annual rental payments
totaling approximately $111,000 through December 30, 1995. On
January 26, 1994, the leases were extended at the same terms
through January 30, 1999.

On January 31, 1987, the Company entered into a lease
agreement for equipment under a seven-year lease agreement,
expiring December 29, 1994. The lease provides for annual rental
payments of approximately $4,000 through December 29, 1994.
(Continued)

F-14
99

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

5. INTEREST-BEARING DEPOSITS

Interest-bearing deposits at December 31, 1993 and 1992 are
summarized as follows:

1993 1992
---- ----
(dollars expressed
in thousands)

Interest-bearing demand deposits. . . . . . . . . . . . . . . . $ 15,875 15,602
Savings deposits. . . . . . . . . . . . . . . . . . . . . . . . 9,693 8,301
Time and certificates of deposit:
Less than $100,000 . . . . . . . . . . . . . . . . . . . 31,761 29,674
$100,000 and over. . . . . . . . . . . . . . . . . . . . 6,305 5,158
------ ------
$ 63,634 58,735
====== ======

Interest on deposits for the years ended December 31, 1993,
1992, and 1991 consists of the following:

1993 1992 1991
---- ---- ----
(dollars expressed in thousands)

Interest-bearing demand deposits. . . . . . . . . . . . $ 350 491 624
Savings deposits. . . . . . . . . . . . . . . . . . . . 252 255 248
Time and certificates of deposit:
Less than $100,000 . . . . . . . . . . . . . . . 1,340 1,711 2,174
$100,000 and over. . . . . . . . . . . . . . . . 215 254 303
----- ----- -----
$ 2,157 $ 2,711 $ 3,349
===== ===== =====

6. NOTES PAYABLE

Note payable consists of a term loan of $1,750,000 and
$2,000,000 at December 31, 1993 and 1992, respectively, from an
unaffiliated bank.

The term loan provides for interest payments semiannually. In
accordance with the term loan agreement, the term loan bears
interest at the lending bank's prime rate on commercial loans (6.0%
at December 31, 1993 and 1992). Common stock of the Bank is
pledged to secure the term loan. The term loan contains various
restrictions and limitations with respect to the Company, including
incurring additional debt, maintenance of certain financial ratios,
and restrictions on dividends on common stock. As of December 31,
1993, the Company has complied with all restrictions and
limitations in the term loan agreement.
(Continued)

F-15
100

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

On December 31, 1993, the term loan matured and was extended
through June 30, 1994. On June 30, 1994, a new loan agreement was
signed with the same unaffiliated bank. This agreement represents
a demand note with an original face value of $1,750,000. The note
provides for interest payments semiannually and bears interest at
the lending bank's prime rate on commercial loans. Principal
payments are not required, but the Company has the right to prepay
the demand note in whole or in part at any time without penalty or
premium provided certain conditions are met. Common stock of the
Bank is pledged to secure the demand note.

7. INCOME TAXES

As discussed in note 1, the Company adopted SFAS 109 as of
January 1, 1993; however, no adjustment to the consolidated
statement of income was necessary to reflect the cumulative effect
of this adoption in the Company's consolidated financial
statements.

The components of income tax expense (benefit) for the years
ended December 31, 1993, 1992, and 1991 are as follows:

1993 1992 1991
---- ---- ----
(dollars expressed in thousands)

Current federal income taxes. . . . . . . . . . . . . . . $ 325 239 125
Deferred income taxes . . . . . . . . . . . . . . . . . . (16) (37) (22)
--- --- ---
$ 309 202 103
=== === ===

A reconciliation of expected income tax expense to income tax
expense computed by applying the federal statutory rate of 34% to
income before income tax expense for the years ended December 31,
1993, 1992, and 1991 to reported income tax expense is as follows:

1993 1992 1991
---- ---- ----
(dollars expressed in thousands)

Income tax expense at statutory rate. . . . . . . . . . . $ 390 280 181
Increase (decrease) in income taxes resulting from:
Tax-exempt income. . . . . . . . . . . . . . . . . (102) (97) (88)
Other, net . . . . . . . . . . . . . . . . . . . . 21 19 10
--- --- ---
Income tax expense $ 309 202 103
=== === ===

(Continued)

F-16
101

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The significant components of deferred income tax benefit for
the years ended December 31, 1992 and 1991 are as follows:

1992 1991
---- ----
(dollars expressed
in thousands)

Depreciation. . . . . . . . . . . . . . . . . . . . . . . . . . $ (3) (8)
Provision for possible loan losses for financial reporting
purposes greater than for tax reporting purposes. . . . . . . 45 17
Other, net. . . . . . . . . . . . . . . . . . . . . . . . . . . (5) 13
-- --
$ 37 22
== ==

The tax effect of temporary differences that give rise to
significant portions of the deferred tax assets and deferred tax
liabilities at December 31, 1993 are presented below (dollars
expressed in thousands):

Deferred tax assets - loans, principally due to allowance for
possible loan losses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 114
---
Deferred tax liabilities:
Office properties, furniture and equipment, principally due to
accelerated depreciation for tax purposes. . . . . . . . . . . . . . . 127
Gain on available-for-sale investment securities . . . . . . . . . . . . 19
---
Total gross deferred tax liabilities . . . . . . . . . . . . . . . 146
---
Net deferred tax liability . . . . . . . . . . . . . . . . . . . . $ 32
===

Pursuant to SFAS 109, a valuation allowance would be provided
on deferred tax assets when it is more likely than not some portion
of the assets will not be realized. The Company has not
established a valuation allowance as of December 31, 1993, due to
management's belief that all criteria for recognition have been
met, including the existence of a history of taxes paid sufficient
to support the realization of the deferred tax assets.

8. COMMITMENTS AND CONTINGENT LIABILITIES

The Company is party to financial instruments with off-
balance-sheet risk in the normal course of business to meet the
financing needs of its customers and to reduce its own exposure to
fluctuations in interest rates. These financial instruments
include commitments to extend credit and standby letters of credit.
Those instruments involve, to varying degrees, elements of credit
and interest rate risk in excess of the amount recognized in the
consolidated balance sheets. The contractual amounts of those
instruments reflect the extent of involvement the Company has in
particular classes of financial instruments.
(Continued)

F-17
102

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company's exposure to credit loss in the event of
nonperformance by the other party to the financial instrument for
commitments to extend credit and standby letters of credit is
represented by the contractual amount of those instruments. The
Company uses the same credit policies in making commitments and
conditional obligations as it does for on-balance-sheet
instruments.

Contract amount
---------------
1993 1992
---- ----
(dollars expressed
in thousands)

Financial instruments whose contract amounts represent:
Commitments to extend credit . . . . . . . . . . . . . . . . . . $ 2,806 3,085
Standby letters of credit. . . . . . . . . . . . . . . . . . . . 134 152
===== =====

Commitments to extend credit are agreements to lend to a
customer as long as there is no violation of any conditions
established in the contract. Commitments generally have fixed
expiration dates or other termination clauses and may require
payment of a fee. Since certain of the commitments are expected to
expire without being drawn upon, the total commitment amounts do
not necessarily represent future cash requirements. The Company
evaluates each customer's creditworthiness on a case-by-case basis.
The amount of collateral obtained, if deemed necessary by the
Company upon extension of credit, is based on management's credit
evaluation of the counterparty. Collateral held varies, but may
include commercial and residential real estate, accounts
receivable, inventory and equipment, and securities.

Standby letters of credit are conditional commitments issued
by the Bank to guarantee the performance of a customer to a third
party. Those guarantees are primarily issued to support public and
private borrowing arrangements, including commercial paper, bond
financing, and similar transactions. The credit risk involved in
issuing letters of credit is essentially the same as that involved
in extending loan facilities to customers. The Company holds
collateral supporting those commitments for which collateral is
deemed necessary. Collateral held varies, but may include
commercial and residential real estate, accounts receivable,
inventory and equipment, and securities.

At December 31, 1993, all of the Company's credit commitments
expire in less than five years.

In the ordinary course of business, there are various legal
proceedings against the Company. Management, after consultation
with legal counsel, is of the opinion that the ultimate resolution
of these proceedings will have no material adverse effect on the
financial position of the Company.
(Continued)

F-18
103

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

9. DIVIDEND LIMITATIONS

The Bank is restricted by state and federal regulations, as
well as by the terms of the Company's current loan agreement
described in note 6, in the amount of dividends which is available
for payment to the Company. The Bank is state-chartered and
subject to supervision by the Federal Deposit Insurance Corporation
and the Illinois Commissioner of Bank and Trust Companies, and is
only limited in the amount of dividends paid, without prior
regulatory approval, to maintain minimum capital requirements and
what sound and prudent banking practices would permit. In
accordance with the provisions of the merger agreement described in
note 13, the Company is prohibited from making any dividend
distributions to the shareholders from September 1, 1994 through
the transaction closing date, which is expected to occur in the
first quarter of 1995.

10. EMPLOYEE BENEFITS

The Company sponsors a noncontributory money purchase plan and
trust covering employees who have completed one year of service and
who have attained age 21. The annual contributions to the plan are
equal to 13.4% of each participant's compensation for each plan
year. Total profit-sharing expense amounted to $82,000, $83,000,
and $82,500 for the years ended December 31, 1993, 1992, and 1991,
respectively.

Postretirement benefits other than pensions are generally not
provided for the Company's employees.

11. PARENT COMPANY ONLY FINANCIAL INFORMATION

Following are condensed balance sheets of Salem Community
Bancorp, Inc. (parent company only) as of December 31, 1993 and
1992, and condensed statements of income and cash flows for the
years ended December 31, 1993, 1992, and 1991:
(Continued)

F-19
104

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED BALANCE SHEETS
(dollars expressed in thousands)

ASSETS 1993 1992
---- ----

Cash deposited in Bank. . . . . . . . . . . . . . . . . . . . . . . . . . . $ -- 1
Investment in Bank, at equity . . . . . . . . . . . . . . . . . . . . . . . 5,605 4,963
Excess of purchase price over equity in Bank, net of accumulated
amortization of $63,000 in 1993 and $56,000 in 1992 . . . . . . . . . . . 224 238
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- 1
----- -----
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,829 5,203
===== =====
LIABILITIES AND STOCKHOLDERS' EQUITY
Note payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,750 2,000
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 --
----- -----
Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . 1,752 2,000
----- -----
Stockholders' equity:
Common stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 8
Surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 766 766
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,266 2,429
Unrealized gain on investment securities available-for-sale, net. . . . . 37 --
----- -----
Total stockholders' equity . . . . . . . . . . . . . . . . . . . . . 4,077 3,203
----- -----
Total liabilities and stockholders' equity . . . . . . . . . . . . . $ 5,829 5,203
===== =====

CONDENSED STATEMENTS OF INCOME
(dollars expressed in thousands)

1993 1992 1991
---- ---- ----

Income - dividends from Bank. . . . . . . . . . . . . . . . . . . . . . . $ 333 360 293
--- --- ---
Expenses:
Interest expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . 118 145 224
Amortization of purchase price over equity of Bank. . . . . . . . . . . 7 7 7
--- --- ---
Total expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 125 152 231
--- --- ---
Income before income tax benefit and equity in
undistributed earnings of Bank . . . . . . . . . . . . . . . . . 208 208 62
Income tax benefit. . . . . . . . . . . . . . . . . . . . . . . . . . . . (40) (49) (76)
--- --- ---
Income before equity in undistributed earnings of
Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 248 257 138
Equity in undistributed earnings of Bank. . . . . . . . . . . . . . . . . 589 365 291
--- --- ---
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 837 622 429
=== === ===

(Continued)

F-20
105

SALEM COMMUNITY BANCORP, INC.
AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED STATEMENTS OF CASH FLOW
(dollars expressed in thousands)

1993 1992 1991
---- ---- ----

Cash flows from operating activities:
Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 837 622 429
Adjustments to reconcile net income to net cash:
Equity in undistributed earnings of Bank . . . . . . . . . . . . . (589) (365) (291)
Amortization of purchase price over equity in
Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 7 7
Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 (14) --
---- ---- ----
Net cash provided by operating activities. . . . . . . . . . 257 250 145
Cash flows from investing activities - purchase of
Bank stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8) (4) --
Cash flows from financing activities - decrease in
notes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (250) (250) (150)
---- ---- ----
Net decrease in cash and cash
equivalents. . . . . . . . . . . . . . . . . . . . . . . . (1) (4) (5)
Cash and cash equivalents, beginning of year. . . . . . . . . . . . . . . 1 5 10
---- ---- ----
Cash and cash equivalents, end of year. . . . . . . . . . . . . . . . . . $ -- 1 5
==== ==== ====

12. BASIS OF PRESENTATION - INTERIM CONSOLIDATED FINANCIAL INFORMATION
(UNAUDITED)

The unaudited interim consolidated financial statements
include the accounts of Salem Community Bancorp, Inc. and
its subsidiary after elimination of material intercompany
transactions. This unaudited data, in the opinion of the
Company, includes all adjustments necessary for the fair
presentation thereof. All adjustments made were of a normal
and recurring nature.

13. SUBSEQUENT EVENT

On September 1, 1994, the Company entered into a merger
agreement with Boatmen's Bancshares, Inc. (Boatmen's) and
Boatmen's - Illinois, Inc. At December 31, 1993, Boatmen's
had total assets of approximately $27 billion. The merger
agreement calls for stockholders of the Company to receive
approximately 37.57 shares of Boatmen's common stock for
each share of outstanding common stock of Salem Community
Bancorp, Inc. The merger is contingent upon approval of
various regulatory agencies and the stockholders of Salem
Community Bancorp, Inc. and, if approved, is expected to
close by the first quarter of 1995.

F-21
106

APPENDIX A

- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------

AGREEMENT AND PLAN OF MERGER

by and among

SALEM COMMUNITY BANCORP, INC.
an Illinois corporation,

and

BOATMEN'S BANCSHARES, INC.,
a Missouri corporation,

and

BOATMEN'S-ILLINOIS, INC.
an Illinois corporation,

Dated September 1, 1994

- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------

107

TABLE OF CONTENTS
-----------------

Page
----

ARTICLE ONE - TERMS OF THE MERGER & CLOSING . . . . . . . . . . . . . . . . . . . . A-1

Section 1.01. The Merger . . . . . . . . . . . . . . . . . . . . . . . A-1
Section 1.02. Merging Corporation. . . . . . . . . . . . . . . . . . . A-1
Section 1.03. Surviving Corporation. . . . . . . . . . . . . . . . . . A-1
Section 1.04. Effect of the Merger . . . . . . . . . . . . . . . . . . A-1
Section 1.05. Conversion of Shares . . . . . . . . . . . . . . . . . . A-1
Section 1.06. The Closing. . . . . . . . . . . . . . . . . . . . . . . A-2
Section 1.07. Exchange Procedures; Surrender of Certificates . . . . . A-2
Section 1.08. Closing Date . . . . . . . . . . . . . . . . . . . . . . A-3
Section 1.09. Actions At Closing . . . . . . . . . . . . . . . . . . . A-3

ARTICLE TWO - REPRESENTATIONS OF COMPANY. . . . . . . . . . . . . . . . . . . . . . A-4

Section 2.01. Organization and Capital Stock . . . . . . . . . . . . . A-4
Section 2.02. Authorization; No Defaults . . . . . . . . . . . . . . . A-5
Section 2.03. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . A-5
Section 2.04. Financial Information. . . . . . . . . . . . . . . . . . A-6
Section 2.05. Absence of Changes . . . . . . . . . . . . . . . . . . . A-6
Section 2.06. Regulatory Enforcement Matters . . . . . . . . . . . . . A-6
Section 2.07. Tax Matters. . . . . . . . . . . . . . . . . . . . . . . A-6
Section 2.08. Litigation . . . . . . . . . . . . . . . . . . . . . . . A-6
Section 2.09. Employment Agreements. . . . . . . . . . . . . . . . . . A-7
Section 2.10. Reports. . . . . . . . . . . . . . . . . . . . . . . . . A-7
Section 2.11. Loan Portfolio . . . . . . . . . . . . . . . . . . . . . A-7
Section 2.12. Employee Matters and ERISA . . . . . . . . . . . . . . . A-7
Section 2.13. Title to Properties; Insurance . . . . . . . . . . . . . A-8
Section 2.14. Environmental Matters. . . . . . . . . . . . . . . . . . A-9
Section 2.15. Compliance with Law. . . . . . . . . . . . . . . . . . . A-9
Section 2.16. Brokerage. . . . . . . . . . . . . . . . . . . . . . . . A-9
Section 2.17. No Undisclosed Liabilities . . . . . . . . . . . . . . . A-9
Section 2.18. Statements True and Correct. . . . . . . . . . . . . . .A-10

ARTICLE THREE - REPRESENTATIONS OF BOATMEN'S AND ACQUISITIONCO. . . . . . . . . . .A-10

Section 3.01. Organization and Capital Stock . . . . . . . . . . . . .A-10
Section 3.02. Authorization. . . . . . . . . . . . . . . . . . . . . .A-11
Section 3.03. Subsidiaries . . . . . . . . . . . . . . . . . . . . . .A-11
Section 3.04. Financial Information. . . . . . . . . . . . . . . . . .A-11
Section 3.05. Absence of Changes . . . . . . . . . . . . . . . . . . .A-12
Section 3.06. Litigation . . . . . . . . . . . . . . . . . . . . . . .A-12
Section 3.07. Reports. . . . . . . . . . . . . . . . . . . . . . . . .A-12

A-i
108
Section 3.08. Compliance With Law. . . . . . . . . . . . . . . . . . .A-12
Section 3.09. Statements True and Correct. . . . . . . . . . . . . . .A-12

ARTICLE FOUR - AGREEMENTS OF COMPANY. . . . . . . . . . . . . . . . . . . . . . . .A-13

Section 4.01. Business in Ordinary Course. . . . . . . . . . . . . . .A-13
Section 4.02. Breaches . . . . . . . . . . . . . . . . . . . . . . . .A-15
Section 4.03. Subsidiary Bank Merger.. . . . . . . . . . . . . . . . .A-15
Section 4.04. Submission to Shareholders . . . . . . . . . . . . . . .A-15
Section 4.05. Consents to Contracts and Leases . . . . . . . . . . . .A-15
Section 4.06. Conforming Accounting and Reserve Policies;
Restructuring Expenses . . . . . . . . . . . . . . . . .A-16
Section 4.07. Consummation of Agreement. . . . . . . . . . . . . . . .A-16
Section 4.08. Environmental Reports. . . . . . . . . . . . . . . . . .A-17
Section 4.09. Restriction on Resales . . . . . . . . . . . . . . . . .A-17
Section 4.10. Access to Information. . . . . . . . . . . . . . . . . .A-17

ARTICLE FIVE - AGREEMENTS OF BOATMEN'S AND ACQUISITIONCO. . . . . . . . . . . . . .A-18

Section 5.01. Regulatory Approvals and Registration
Statement. . . . . . . . . . . . . . . . . . . . . . . .A-18
Section 5.02. Breaches . . . . . . . . . . . . . . . . . . . . . . . .A-18
Section 5.03. Consummation of Agreement. . . . . . . . . . . . . . . .A-19
Section 5.04. Directors and Officers' Liability Insurance and
Indemnification . . . . . . . . . . . . . . . . . . . .A-19
Section 5.05. Employee Benefits. . . . . . . . . . . . . . . . . . . .A-19
Section 5.06. Subsidiary Bank Merger . . . . . . . . . . . . . . . . .A-20
Section 5.07. Access to Information. . . . . . . . . . . . . . . . . .A-20

ARTICLE SIX - CONDITIONS PRECEDENT TO THE MERGER. . . . . . . . . . . . . . . . . .A-20

Section 6.01. Conditions to Boatmen's Obligations. . . . . . . . . . .A-20
Section 6.02. Conditions to Company's Obligations. . . . . . . . . . .A-21

ARTICLE SEVEN - TERMINATION OR ABANDONMENT. . . . . . . . . . . . . . . . . . . . .A-22

Section 7.01. Mutual Agreement . . . . . . . . . . . . . . . . . . . .A-22
Section 7.02. Breach of Agreements . . . . . . . . . . . . . . . . . .A-22
Section 7.03. Environmental Reports. . . . . . . . . . . . . . . . . .A-22
Section 7.04. Failure of Conditions. . . . . . . . . . . . . . . . . .A-23
Section 7.05. Regulatory Approval Denial . . . . . . . . . . . . . . .A-23
Section 7.06. Shareholder Approval Denial. . . . . . . . . . . . . . .A-23
Section 7.07. Regulatory Enforcement Matters . . . . . . . . . . . . .A-23
Section 7.08. Fall-Apart Date. . . . . . . . . . . . . . . . . . . . .A-23
Section 7.09. Termination Fee. . . . . . . . . . . . . . . . . . . . .A-23
Section 7.10. Due Diligence Review . . . . . . . . . . . . . . . . . .A-25

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ARTICLE EIGHT - GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .A-25

Section 8.01. Confidential Information . . . . . . . . . . . . . . . .A-25
Section 8.02. Publicity. . . . . . . . . . . . . . . . . . . . . . . .A-25
Section 8.03. Return of Documents. . . . . . . . . . . . . . . . . . .A-25
Section 8.04. Notices. . . . . . . . . . . . . . . . . . . . . . . . .A-26
Section 8.05. Liabilities. . . . . . . . . . . . . . . . . . . . . . .A-26
Section 8.06. Nonsurvival of Representations, Warranties
and Agreements . . . . . . . . . . . . . . . . . . . . .A-27
Section 8.07. Entire Agreement . . . . . . . . . . . . . . . . . . . .A-27
Section 8.08. Headings and Captions. . . . . . . . . . . . . . . . . .A-27
Section 8.09. Waiver, Amendment or Modification. . . . . . . . . . . .A-27
Section 8.10. Rules of Construction. . . . . . . . . . . . . . . . . .A-27
Section 8.11. Counterparts . . . . . . . . . . . . . . . . . . . . . .A-27
Section 8.12. Successors and Assigns . . . . . . . . . . . . . . . . .A-27
Section 8.13. Severability . . . . . . . . . . . . . . . . . . . . . .A-27
Section 8.14. Governing Law; Assignment. . . . . . . . . . . . . . . .A-28

EXHIBIT 1.09(a) - Company's Legal Opinion Matters
EXHIBIT 1.09(b) - Boatmen's Legal Opinion Matters
EXHIBIT 4.03 - Form of Subsidiary Bank Merger Agreement
EXHIBIT 4.09 - Form of Affiliate's Letter
EXHIBIT 7.09 - Index Group

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AGREEMENT AND PLAN OF MERGER
----------------------------

This is an AGREEMENT AND PLAN OF MERGER (this "Agreement")
made September 1, 1994, by and among BOATMEN'S BANCSHARES, INC., a
Missouri corporation ("Boatmen's"), BOATMEN'S-ILLINOIS, INC., an
Illinois corporation and wholly owned subsidiary of Boatmen's
("AcquisitionCo"), and SALEM COMMUNITY BANCORP, INC., an Illinois
corporation, ("Company").

In consideration of the premises and the mutual terms and
provisions set forth in this Agreement, the parties agree as
follows.

ARTICLE ONE
-----------

TERMS OF THE MERGER & CLOSING
-----------------------------

SECTION 1.01. THE MERGER. Pursuant to the terms and
------------ ----------
provisions of this Agreement and the Illinois Business Corporation
Law (the "Corporate Law"), Company shall merge with and into
AcquisitionCo (the "Merger").

SECTION 1.02. MERGING CORPORATION. Company shall be the
------------ -------------------
merging corporation under the Merger and its corporate identity and
existence, separate and apart from AcquisitionCo, shall cease on
consummation of the Merger.

SECTION 1.03. SURVIVING CORPORATION. AcquisitionCo shall be
------------ ---------------------
the surviving corporation in the Merger. No changes in the
articles of incorporation of AcquisitionCo shall be effected by the
Merger.

SECTION 1.04. EFFECT OF THE MERGER. The Merger shall have
------------ --------------------
all of the effects provided by this Agreement and the Corporate
Law.

SECTION 1.05. CONVERSION OF SHARES.
------------ --------------------

(a) At the Effective Time (as defined below), each share of
common stock, par value $1.00, of Company (the "Company Common")
issued and outstanding immediately prior to the Effective Time,
other than shares the holders of which have duly exercised and
perfected their dissenters' rights under the Corporate Law, shall
be converted into the right to receive 37.57 shares of common
stock, par value $1.00 per share, of Boatmen's (the "Boatmen's
Common") (together with any cash payment in lieu of fractional
shares, as provided below, the "Merger Consideration"). No
fractional shares of Boatmen's Common shall be issued and, in lieu
thereof, holders of shares of Company Common who would otherwise be
entitled to a fractional share interest (after taking into account
all shares of Company Common held by such holder) shall be paid an
amount in cash equal to the product of such fractional share
interest and the closing price of a share of Boatmen's Common on
the Nasdaq Stock Market's National Market ("Nasdaq") on the
business day immediately preceding the date on which the Effective
Time occurs.

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(b) At the Effective Time, all of the shares of Company
Common, by virtue of the Merger and without any action on the part
of the holders thereof, shall no longer be outstanding and shall be
canceled and retired and shall cease to exist, and each holder of
any certificate or certificates which immediately prior to the
Effective Time represented outstanding shares of Company Common
(the "Certificates") shall thereafter cease to have any rights with
respect to such shares, except the right of such holders to
receive, without interest, the Merger Consideration upon the
surrender of such Certificate or Certificates in accordance with
Section 1.07.

(c) At the Effective Time, each share of Company Common, if
any, held in the treasury of Company or by any direct or indirect
subsidiary of Company (other than shares held in trust accounts for
the benefit of others or in other fiduciary, nominee or similar
capacities) immediately prior to the Effective Time shall be
canceled.

(d) Each share of common stock, par value $1.00 per share, of
AcquisitionCo outstanding immediately prior to the Effective Time
remain issued and outstanding unaffected by the Merger.

(e) If between the date hereof and the Effective Time a share
of Boatmen's Common shall be changed into a different number of
shares of Boatmen's Common or a different class of shares by reason
of reclassification, recapitalization, splitup, exchange of shares
or readjustment, or if a stock dividend thereon shall be declared
with a record date within such period, then the fraction of a share
of Boatmen's Common into which a share of Company Common shall be
converted pursuant to subsection (a) above shall be appropriately
and proportionately adjusted so that each shareholder of Company
shall be entitled to receive such number of shares of Boatmen's
Common as such shareholder would have received pursuant to such
reclassification, recapitalization, splitup, exchange of shares or
readjustment or as a result of such stock dividend had the record
date therefor been immediately following the Effective Time of the
Merger.

(f) If holders of Company Common are entitled to dissent from
the Agreement and Merger under the Corporate Law, any issued and
outstanding shares of Company Common held by a dissenting holder
shall not be converted as described in Section 1.05 but from and
after the Effective Time shall represent only the right to receive
such consideration as may be determined to be due to such
dissenting holder pursuant to the Corporate Law; provided, however,
that each share of Company Common outstanding immediately prior to
the Effective Time and held by a dissenting holder who shall, after
the Effective Time, withdraw his demand for appraisal or lose his
right of appraisal shall have only such rights as are provided
under Corporate Law.

SECTION 1.06. THE CLOSING. The closing of the Merger (the
------------ -----------
"Closing") shall take place at a location mutually agreeable to the
parties at 10:00 A.M. Central Time on the Closing Date described in
Section 1.08 of this Agreement.

SECTION 1.07. EXCHANGE PROCEDURES; SURRENDER OF CERTIFICATES.
------------ ----------------------------------------------

(a) Boatmen's Trust Company, St. Louis, Missouri, shall act
as Exchange Agent in the Merger (the "Exchange Agent").

(b) As soon as reasonably practicable after the Effective
Time, the Exchange Agent shall mail to each record holder of any
Certificate or Certificates whose shares were converted into the
right to

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receive the Merger Consideration, a letter of transmittal (which shall specify
that delivery shall be effected, and risk of loss and title to the
Certificates shall pass, only upon proper delivery of the Certificates to the
Exchange Agent and shall be in such form and have such other provisions as
Boatmen's may reasonably specify) (each such letter, the "Merger Letter of
Transmittal") and instructions for use in effecting the surrender
of the Certificates in exchange for the Merger Consideration. Upon
surrender to the Exchange Agent of a Certificate, together with a
Merger Letter of Transmittal duly executed and any other required
documents, the holder of such Certificate shall be entitled to
receive in exchange therefor solely the Merger Consideration. No
interest on the Merger Consideration issuable upon the surrender of
the Certificates shall be paid or accrued for the benefit of
holders of Certificates. If the Merger Consideration is to be
issued to a person other than a person in whose name a surrendered
Certificate is registered, it shall be a condition of issuance that
the surrendered Certificate shall be properly endorsed or otherwise
in proper form for transfer and that the person requesting such
issuance shall pay to the Exchange Agent any required transfer or
other taxes or establish to the satisfaction of the Exchange Agent
that such tax has been paid or is not applicable.

(c) No dividends that are otherwise payable on shares of
Boatmen's Common constituting the Merger Consideration shall be
paid to persons entitled to receive such shares of Boatmen's Common
until such persons surrender their Certificates. Upon such
surrender, there shall be paid to the person in whose name the
shares of Boatmen's Common shall be issued any dividends which
shall have become payable with respect to such shares of Boatmen's
Common (without interest and less the amount of taxes, if any,
which may have been imposed thereon), between the Effective Time
and the time of such surrender.

SECTION 1.08. CLOSING DATE. At Boatmen's election, the
------------ ------------
Closing shall take place on (i) the last business day of, or
(ii) the first business day of the month following, or (iii) the
last business day of the earliest month which is the second month
of a calendar quarter following, in each case, the month during
which each of the conditions in Sections 6.01(d) and 6.02(d) is
satisfied or waived by the appropriate party or on such other date
after such satisfaction or waiver as Company and Boatmen's may
agree (the "Closing Date"). The Merger shall be effective upon the
filing of Articles of Merger with the Secretary of State of the
State of Illinois (the "Effective Time"), which the parties shall
use their best efforts to cause to occur on the Closing Date.

SECTION 1.09. ACTIONS AT CLOSING.
------------ ------------------

(a) At the Closing, Company shall deliver to Boatmen's and
AcquisitionCo:

(i) a certified copy of the Articles of Incorporation of
Company and Community State Bank (the "Bank");

(ii) a Certificate signed by an appropriate officer of
Company stating that (A) each of the representations and
warranties contained in Article Two is true and correct in all
material respects at the time of the Closing with the same
force and effect as if such representations and warranties had
been made at Closing, and (B) all of the conditions set forth
in Section 6.01(b) have been satisfied or waived as provided
therein;

A-3
113

(iii) a certified copy of the resolutions of Company's
Board of Directors and shareholders, as required for valid
approval of the execution of this Agreement and the
consummation of the Merger and the other transactions
contemplated hereby;

(iv) Certificate of the Illinois Secretary of State,
dated a recent date, stating that Company is in good standing;
and

(v) a legal opinion from counsel for Company, in form
reasonably acceptable to Boatmen's counsel, opining with
respect to the matters listed on Exhibit 1.09(a) hereto.

(b) At the Closing, Boatmen's shall deliver to Company:

(i) a Certificate signed by an appropriate officer of
Boatmen's and AcquisitionCo stating that (A) each of the
representations and warranties contained in Article Three is
true and correct in all material respects at the time of the
Closing with the same force and effect as if such
representations and warranties had been made at Closing and
(B) all of the conditions set forth in Section 6.02(b) and
6.02(d) (but excluding the approval of the Company's
shareholders) have been satisfied;

(ii) a certified copy of the resolutions of Boatmen's
Board of Directors or Executive Committee authorizing the
execution of this Agreement and the consummation of the
transactions contemplated hereby;

(iii) a certified copy of the resolutions of
AcquisitionCo's Board of Directors and shareholder, as
required for valid approval of the execution of this Agreement
and the consummation of the transactions contemplated hereby;
and

(iv) a legal opinion from counsel for Boatmen's, in form
reasonable acceptable to Company's counsel, opining with
respect to the matters listed on Exhibit 1.09(b) hereto.

ARTICLE TWO
-----------

REPRESENTATIONS OF COMPANY
--------------------------

Company hereby makes the following representations and
warranties:

SECTION 2.01. ORGANIZATION AND CAPITAL STOCK.
------------ ------------------------------

(a) Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Illinois and
has the corporate power to own all of its property and assets, to
incur all of its liabilities and to carry on its business as now
being conducted. The Company is a bank holding company registered
with the Board of Governors of the Federal Reserve System under the
Bank Holding Company Act of 1956.

(b) The authorized capital stock of Company consists of 50,000
shares of Company Common, of which, as of the date hereof, 7,684
shares are issued and outstanding. All of the issued and

A-4
114
outstanding shares of Company Common are duly and validly issued
and outstanding and are fully paid and non-assessable. None of the
outstanding shares of Company Common has been issued in violation
of any preemptive rights of the current or past stockholders of
Company. Except as disclosed in Section 2.01(b) of that certain
confidential writing delivered by Company to Boatmen's and executed
by both Company and Boatmen's concurrently with the delivery and
execution of this Agreement (the "Disclosure Schedule"), each
Certificate representing shares of Company Common issued by Company
in replacement of any Certificate theretofore issued by it which
was claimed by the record holder thereof to have been lost, stolen
or destroyed was issued by Company only upon receipt of an
affidavit of lost stock certificate and indemnity agreement of such
shareholder indemnifying Company against any claim that may be made
against it on account of the alleged loss, theft or destruction of
any such Certificate or the issuance of such replacement
Certificate.

(c) Except as set forth in subsection 2.01(b), there are no
shares of capital stock or other equity securities of Company
outstanding and no outstanding options, warrants, rights to
subscribe for, calls, or commitments of any character whatsoever
relating to, or securities or rights convertible into or
exchangeable for, shares of the capital stock of Company or
contracts, commitments, understandings or arrangements by which
Company is or may be obligated to issue additional shares of its
capital stock or options, warrants or rights to purchase or acquire
any additional shares of its capital stock. Set forth in Section
2.01(c) of the Disclosure Schedule is a list of the record and
beneficial owners of all of the Company Common as of the date of
this Agreement, showing the number of shares owned by each of them.

SECTION 2.02. AUTHORIZATION; NO DEFAULTS. Company's Board of
------------ --------------------------
Directors has, by all appropriate action, approved this Agreement
and the Merger and authorized the execution hereof on its behalf by
its duly authorized officers and the performance by Company of its
obligations hereunder. Nothing in the articles of incorporation or
bylaws of Company, as amended, or any other agreement, instrument,
decree, proceeding, law or regulation (except as specifically
referred to in or contemplated by this Agreement) by or to which it
or Bank are bound or subject which is material to Company and Bank
taken as a whole or to the Merger would prohibit or inhibit Company
from consummating this Agreement and the Merger on the terms and
conditions herein contained. This Agreement has been duly and
validly executed and delivered by Company and constitutes a legal,
valid and binding obligation of Company, enforceable against
Company in accordance with its terms, except as may be provided by
bankruptcy, insolvency or similar laws or by general principles of
equity. Company and Bank are neither in default under nor in
violation of any provision of their articles of incorporation,
bylaws, or any promissory note, indenture or any evidence of
indebtedness or security therefor, lease, contract, purchase or
other commitment or any other agreement which is material to
Company and Bank taken as a whole.

SECTION 2.03. SUBSIDIARIES. Company's only subsidiary is the
------------ ------------
Bank. Bank is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation
and has the corporate power to own its properties and assets, to
incur its liabilities and to carry on its business as now being
conducted. The number of issued and outstanding shares of capital
stock of Bank is set forth in Section 2.03 of the Disclosure
Schedule, all of which shares (except as may be otherwise there
noted) are owned by Company, free and clear of all liens,
encumbrances, rights of first refusal, options or other restric-
tions of any nature whatsoever, except as may be stated in
Section 2.03 of the Disclosure Schedule. There are no options,
warrants or rights outstanding to acquire any capital stock of Bank
and no person or entity has any other right to purchase or acquire
any unissued shares of stock of Bank, nor does Bank have any
obligation of any nature with respect to its unissued shares of
stock. Except as may be

A-5
115
disclosed in Section 2.03 of the Disclosure Schedule, neither Company nor Bank
is a party to any partnership or joint venture or owns an equity interest in
any other business or enterprise. The Bank is the only subsidiary of
the Company. The Bank has no subsidiaries.

SECTION 2.04. FINANCIAL INFORMATION. Copies of the following
------------ ---------------------
financial statements and reports are included in Section 2.04 of
the Disclosure Schedule: (a) the independent auditor's report
dated August 27, 1993 prepared by KPMG Peat Marwick together with
the notes thereto, (b) the year-end and quarterly Reports of
Condition and Report of Income of the Bank for 1993 and June 30,
1994, as filed with the Federal Deposit Insurance Corporation
("FDIC"), and (c) the year-end and quarterly Reports of the Company
on Forms Y-6 and Y-9, respectively, for 1993 and June 30, 1994, as
filed with the Board of Governors of the Federal Reserve System
(the "Federal Reserve Board") (together, the "Company Financial
Statements"). The Company Financial Statements have been prepared,
on a consistent basis throughout the periods presented, on an
accounting basis which is acceptable for, and actually utilized by
Company and Bank on their respective, federal and state income tax
returns and there are no differences between, or adjustments
necessary to reconcile, Company's or Bank's books of account and
such tax returns, and fairly present in all material respects the
consolidated financial position and the consolidated results of
operations, changes in shareholders' equity and cash flows of the
Company and Bank on a consolidated basis as of the dates and for
the periods indicated (subject, in the case of interim financial
statements, to normal recurring year-end adjustments, none of which
will be material).

SECTION 2.05. ABSENCE OF CHANGES. Since December 31, 1993,
------------ ------------------
there has not been any material adverse change in the financial
condition, the results of operations or the business of Company and
Bank taken as a whole, nor have there been any events or trans-
actions having such a material adverse effect which should be dis-
closed in order to make the Company Financial Statements not
misleading. Since September 17, 1993, there has been no material
adverse change in the financial condition, the results of
operations or the business of the Bank. Notwithstanding the
foregoing, any changes for which Company or the Bank, make
provisions for loan losses pursuant to Section 4.06 hereof shall
not be deemed to be a material adverse change.

SECTION 2.06. REGULATORY ENFORCEMENT MATTERS. Except as may
------------ ------------------------------
be disclosed in Section 2.06 of the Disclosure Schedule, neither
Company nor Bank is subject to, or has received any notice or
advice that it may become subject to, any order, agreement or
memorandum of understanding with any federal or state agency
charged with the supervision or regulation of banks or bank holding
companies or engaged in the insurance of bank deposits or any other
governmental agency having supervisory or regulatory authority with
respect to Company or Bank.

SECTION 2.07. TAX MATTERS. Company and Bank have filed all
------------ -----------
federal, state and local tax returns due in respect of any of their
businesses or properties in a timely fashion and have paid or made
provision for all amounts due shown on such returns. All such
returns fairly reflect the information required to be presented
therein. All provisions for accrued but unpaid taxes contained in
the Company Financial Statements in the aggregate do not materially
fail to provide for potential tax liabilities.

SECTION 2.08. LITIGATION. Except as may be disclosed in
------------ ----------
Section 2.08 of the Disclosure Schedule, there is no litigation,
claim or other proceeding pending or, to the knowledge of Company,
threatened, against Company or Bank, or of which the property of
Company or Bank is or would be subject.

A-6
116

SECTION 2.09. EMPLOYMENT AGREEMENTS. Except as may be
------------ ---------------------
disclosed in Section 2.09 of the Disclosure Schedule, neither
Company nor Bank is a party to or bound by any contract for the
employment, retention or engagement, or with respect to the
severance, of any officer, employee, agent, consultant or other
person or entity which, by its terms, is not terminable by Company
or Bank on thirty (30) days written notice or less without the
payment of any amount by reason of such termination. A true,
accurate and complete copy of each such agreement which is in
writing is included in Section 2.09 of the Disclosure Schedule.

SECTION 2.10. REPORTS. Each of Company and Bank has filed
------------ -------
all reports and statements, together with any amendments required
to be made with respect thereto, if any, that it was required to
file with (i) the Federal Reserve Board, (ii) the FDIC, (iii) the
Commissioner of Banks and Trust Companies of the State of Illinois,
(iv) any state securities authorities, and (v) any other
governmental authority with jurisdiction over Company or Bank,
except as may be disclosed in Section 2.10 of the Disclosure
Schedule. As of their respective dates, each of such reports and
documents, including the financial statements, exhibits and
schedules thereto, complied in all material respects with the
relevant statutes, rules and regulations enforced or promulgated by
the regulatory authority with which they were filed, and did not
contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances
under which they were made, not misleading.

SECTION 2.11. LOAN PORTFOLIO. Except as may be disclosed in
------------ --------------
Section 2.11 of the Disclosure Schedule, (i) all loans and
discounts shown on the Company Financial Statements or which were
entered into after the date of the most recent balance sheet
included in the Company Financial Statements were and will be made
in all material respects for good, valuable and adequate
consideration in the ordinary course of the business of Company and
Bank, in accordance in all material respects with sound banking
practices, and are not subject to any material known defenses,
setoffs or counterclaims, including without limitation any such as
are afforded by usury or truth in lending laws, except as may be
provided by bankruptcy, insolvency or similar laws or by general
principles of equity; (ii) the notes or other evidences of
indebtedness evidencing such loans and all forms of pledges,
mortgages and other collateral documents and security agreements
are and will be, in all material respects, enforceable, valid, true
and genuine and what they purport to be; and (iii) Company and Bank
have complied and will prior to the Closing Date comply with all
laws and regulations relating to such loans, or to the extent there
has not been such compliance, such failure to comply will not
materially interfere with the collection of any such loan.

SECTION 2.12. EMPLOYEE MATTERS AND ERISA.
------------ --------------------------

(a) Except as may be disclosed in Section 2.12(a) of the
Disclosure Schedule, neither Company nor Bank has entered into any
collective bargaining agreement with any labor organization with
respect to any group of employees of Company or Bank and to the
knowledge of Company there is no present effort nor existing
proposal to attempt to unionize any group of employees of Company
or Bank.

(b) Except as may be disclosed in Section 2.12(b) of the
Disclosure Schedule, (i) Company and Bank are and have been in
material compliance with all applicable laws respecting employment
and employment practices, terms and conditions of employment and
wages and hours, including, without limitation, any such laws
respecting employment discrimination and occupational safety and
health requirements, and neither Company nor Bank is engaged in any
unfair labor practice; (ii) there is no material unfair labor
practice complaint against Company or Bank pending or, to the
knowledge of

A-7
117
Company, threatened before the National Labor Relations Board; (iii) there is
no labor dispute, strike, slowdown or stoppage actually pending or, to the
knowledge of Company, threatened against or directly affecting Company or
Bank; and (iv) neither Company nor Bank has experienced any material work
stoppage or other material labor difficulty during the past five years.

(c) Except as may be disclosed in Section 2.12(c) of the
Disclosure Schedule, neither Company nor Bank maintains,
contributes to or participates in or has any liability under any
employee benefit plans, as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), or
any nonqualified employee benefit plans or deferred compensation,
bonus, stock or incentive plans, or other employee benefit or
fringe benefit programs for the benefit of former or current
employees of Company or Bank (the "Employee Plans"). To the
knowledge of Company, no present or former employee of Company or
Bank has been charged with breaching nor has breached a fiduciary
duty under any of the Employee Plans. Neither Company nor Bank
participates in, nor has it in the past five years participated in,
nor has it any present or future obligation or liability under, any
multiemployer plan (as defined at Section 3(37) of ERISA). Except
as may be disclosed in Section 2.12(c) of the Disclosure Schedule,
neither Company nor Bank maintains, contributes to, or participates
in, any plan that provides health, major medical, disability or
life insurance benefits to former employees of Company or Bank.

(d) Neither Company nor Bank maintain, nor have any of them
maintained for the past ten years, any Employee Plans subject to
Title IV of ERISA or Section 412 of the Code. No reportable event
(as defined in Section 4043 of ERISA) has occurred with respect to
any Employee Plans as to which a notice would be required to be
filed with the Pension Benefit Guaranty Corporation. No claim is
pending, and Company has not received notice of any threatened or
imminent claim with respect to any Employee Plan (other than a
routine claim for benefits for which plan administrative review
procedures have not been exhausted) for which Company or Bank would
be liable after December 31, 1993, except as is reflected on the
Company Financial Statements. After December 31, 1993, Company and
Bank will not have any liabilities for excise taxes under
Sections 4971, 4975, 4976, 4977, 4979 or 4980B of the Code or for
a fine under Section 502 of ERISA with respect to any Employee
Plan. All Employee Plans have in all material respects been
operated, administered and maintained in accordance with the terms
thereof and in compliance with the requirements of all applicable
laws, including, without limitation, ERISA and the Code.

SECTION 2.13. TITLE TO PROPERTIES; INSURANCE. Except as may
------------ ------------------------------
be disclosed in Section 2.13 of the Disclosure Schedule,
(i) Company and Bank have marketable title, insurable at standard
rates, free and clear of all liens, charges and encumbrances
(except taxes which are a lien but not yet payable and liens,
charges or encumbrances reflected in the Company Financial State-
ments and easements, rights-of-way, and other restrictions which
are not material and further excepting in the case of Other Real
Estate Owned ("O.R.E.O."), as such real estate is internally
classified on the books of Company or Bank rights of redemption
under applicable law) to all of their real properties; (ii) all
leasehold interests for real property and any material personal
property used by Company and Bank in their businesses are held
pursuant to lease agreements which are valid and enforceable in
accordance with their terms; (iii) all such properties comply in
all material respects with all applicable private agreements,
zoning requirements and other governmental laws and regulations
relating thereto and there are no condemnation proceedings pending
or, to the knowledge of Company, threatened with respect to such
properties; (iv) Company and Bank have valid title or other
ownership rights under licenses to all material intangible personal
or intellectual property used by Company or Bank in their business,
free and clear of any claim, defense or right of any other person
or entity which is material to such property, subject only to
rights of the

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licensors pursuant to applicable license agreements, which rights do not
materially adversely interfere with the use of such property; and (v) all
material insurable properties owned or held by Company and Bank are adequately
insured by financially sound and reputable insurers in such amounts and
against fire and other risks insured against by extended coverage and public
liability insurance, as is customary with bank holding companies of
similar size.

SECTION 2.14. ENVIRONMENTAL MATTERS. As used in this
------------ ---------------------
Agreement, "Environmental Laws" means all local, state and federal
environmental, health and safety laws and regulations in all
jurisdictions in which Company and Bank have done business or
owned, leased or operated property, including, without limitation,
the Federal Resource Conservation and Recovery Act, the Federal
Comprehensive Environmental Response, Compensation and Liability
Act, the Federal Clean Water Act, the Federal Clean Air Act, and
the Federal Occupational Safety and Health Act.

Except as may be disclosed in Section 2.14 of the Disclosure
Schedule, neither the conduct nor operation of Company or Bank nor
any condition of any property presently or previously owned, leased
or operated by any of them violates or violated Environmental Laws
in any respect material to the business of Company and Bank and no
condition has existed or event has occurred with respect to any of
them or any such property that, with notice or the passage of time,
or both, would constitute a violation material to the business of
Company and Bank of Environmental Laws or obligate (or potentially
obligate) Company or Bank to remedy, stabilize, neutralize or
otherwise alter the environmental condition of any such property
where the aggregate cost of such actions would be material to
Company and Bank. Except as may be disclosed in Section 2.14 of
the Disclosure Schedule, neither Company nor Bank has received any
notice from any person or entity that Company or Bank or the
operation or condition of any property ever owned, leased or
operated by any of them are or were in violation of any
Environmental Laws or that any of them are responsible (or
potentially responsible) for the cleanup or other remediation of
any pollutants, contaminants, or hazardous or toxic wastes,
substances or materials at, on or beneath any such property.

SECTION 2.15. COMPLIANCE WITH LAW. Company and Bank have all
------------ -------------------
licenses, franchises, permits and other governmental authorizations
that are legally required to enable them to conduct their
respective businesses in all material respects and are in
compliance in all material respects with all applicable laws and
regulations.

SECTION 2.16. BROKERAGE. There are no existing claims or
------------ ---------
agreements for brokerage commissions, finders' fees, or similar
compensation in connection with the transactions contemplated by
this Agreement payable by Company or Bank.

SECTION 2.17. NO UNDISCLOSED LIABILITIES. Company and Bank
------------ --------------------------
do not have any material liability, whether known or unknown,
whether asserted or unasserted, whether absolute or contingent,
whether accrued or unaccrued, whether liquidated or unliquidated,
and whether due or to become due (and there is no past or present
fact, situation, circumstance, condition or other basis for any
present or future action, suit or proceeding, hearing, charge,
complaint, claim or demand against Company or Bank giving rise to
any such liability), except (i) for liabilities set forth in the
Company Financial Statements, (ii) fluctuation in the amount of the
liabilities referred to in clause (i) above occurring in the
ordinary course of business of the Company and Bank, since the date
of the most recent balance sheet included in the Company Financial
Statements, and (iii) as may be disclosed in Section 2.17 of the
Disclosure Schedule.

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SECTION 2.18. STATEMENTS TRUE AND CORRECT. None of the
------------ ---------------------------
information supplied or to be supplied by Company or Bank for
inclusion in (i) the Registration Statement (as defined in
Section 4.06), (ii) the Proxy Statement/Prospectus (as defined in
Section 4.04) and (iii) any other documents to be filed with the
S.E.C. or any banking or other regulatory authority in connection
with the transactions contemplated hereby, will, at the respective
times such documents are filed, and, in the case of the
Registration Statement, when it becomes effective, and with respect
to the Proxy Statement/Prospectus, when first mailed to the
stockholders of the Company and the Bank and at the time of such
stockholder meetings, contain any untrue statement of a material
fact, or omit to state any material fact necessary in order to make
the statements made therein, in light of the circumstances under
which they are made, not misleading. All documents that Company is
responsible for filing with the S.E.C. or any other regulatory
authority in connection with the transactions contemplated hereby
will comply as to form in all material respects with the provisions
of applicable law and the applicable rules and regulations
thereunder.

ARTICLE THREE
-------------

REPRESENTATIONS OF BOATMEN'S AND ACQUISITIONCO
----------------------------------------------

Boatmen's and AcquisitionCo hereby make the following
representations and warranties:

SECTION 3.01. ORGANIZATION AND CAPITAL STOCK.
------------ ------------------------------

(a) Boatmen's is a corporation duly incorporated, validly
existing, and in good standing under the laws of the State of
Missouri with full corporate power and authority to carry on its
business as it is now being conducted. Boatmen's is a bank holding
company registered with the Board of Governors of the Federal
Reserve System under the Bank Holding Company Act of 1956.
AcquisitionCo is a corporation duly incorporated, validly existing,
and in good standing under the laws of the State of Illinois with
full corporate power and authority to carry on its business as it
is now being conducted.

(b) The authorized capital stock of Boatmen's consists of
(i) 150,000,000 shares of Boatmen's Common, of which, as of
July 31, 1994, 104,739,985 shares were issued and outstanding, and
(ii) 10,300,000 Cumulative Preferred Shares, no par value per
share, of which 35,045 shares are designated "7% Cumulative
Redeemable Preferred Stock, Series B", $100.00 stated value per
share (the "Boatmen's Series B Preferred Stock"), and 1,500,000
shares are designated "Junior Participating Preferred Stock, Series
C", no par value per share (the "Boatmen's Series C Preferred
Stock"). No shares of the Boatmen's Series C Preferred Stock are
issued and outstanding and 11,421 shares of the Boatmen's Series B
Preferred Stock were issued and outstanding as of July 31, 1994.
All of the issued and outstanding shares of Boatmen's Common and
Boatmen's Series B Preferred Stock are duly and validly issued and
outstanding and are fully paid and non-assessable. None of the
outstanding shares of Boatmen's Common has been issued in violation
of any preemptive rights of the current or past stockholders of
Boatmen's. As of July 31, 1994, Boatmen's had outstanding options
and other rights to acquire not more than 3,426,552 shares of
Boatmen's Common and no shares of the Boatmen's Series B Preferred
Stock or the Boatmen's Series C Preferred Stock.

(c) AcquisitionCo is incorporated under the laws of the State
of Illinois. AcquisitionCo has authorized capital of ten thousand
(10,000) shares of common stock, par value one dollar ($1.00) per

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share (the "AcquisitionCo Common"). As of the date hereof, 1,000
shares of AcquisitionCo Common are issued and outstanding, fully
paid and non-assessable and owned by Boatmen's.

(d) The shares of Boatmen's Common that are to be issued to
the stockholders of Company pursuant to the Merger have been duly
authorized and, when so issued in accordance with the terms of this
Agreement, will be validly issued and outstanding, fully paid and
nonassessable, with no personal liability attaching to the
ownership thereof.

SECTION 3.02. AUTHORIZATION. The Executive Committee or
------------ -------------
Board of Directors of Boatmen's and the Board of Directors of
AcquisitionCo will have by the end of the Due Diligence Period (as
defined in Section 7.10 hereof), unless this Agreement is
theretofore terminated pursuant to Article Seven hereof, by all
appropriate action, approved this Agreement and the Merger and
authorized the execution hereof on their behalf by their respective
duly authorized officers and the performance by such respective
entity of their obligations hereunder. Nothing in the articles of
incorporation or bylaws of Boatmen's or AcquisitionCo, as amended,
or any other agreement, instrument, decree, proceeding, law or
regulation (except as specifically referred to in or contemplated
by this Agreement) by or to which either of them or any of their
subsidiaries are bound or subject would prohibit or inhibit
Boatmen's or AcquisitionCo from entering into and consummating this
Agreement and the Merger on the terms and conditions herein
contained. This Agreement has been duly and validly executed and
delivered by Boatmen's and AcquisitionCo and constitutes a legal,
valid and binding obligation of Boatmen's and AcquisitionCo,
enforceable against Boatmen's and AcquisitionCo in accordance with
its terms and no other corporate acts or proceedings are required
to be taken by Boatmen's or AcquisitionCo (including any approvals
by the shareholders of Boatmen's or AcquisitionCo) to authorize the
execution, delivery and performance of this Agreement. Except for
the requisite approval of the Federal Reserve Board and the
Commissioner of Banks and Trust Companies of the State of Illinois,
no notice to, filing with, authorization by, or consent or approval
of, any federal or state regulatory authority is necessary for the
execution and delivery of this Agreement or consummation of the
Merger by Boatmen's or AcquisitionCo.

SECTION 3.03. SUBSIDIARIES. Each of Boatmen's significant
------------ ------------
subsidiaries (as such term is defined under S.E.C. regulations) and
AcquisitionCo is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation
and has the corporate power to own its respective properties and
assets, to incur its respective liabilities and to carry on its
respective business as now being conducted.

SECTION 3.04. FINANCIAL INFORMATION. The consolidated
------------ ---------------------
balance sheets of Boatmen's and its subsidiaries as of December 31,
1992 and 1993 and related consolidated statements of income,
changes in stockholders' equity and cash flows for the three years
ended December 31, 1993, together with the notes thereto, included
in Boatmen's 10-K for the year ended 1993, as currently on file
with the S.E.C. and the unaudited consolidated balance sheets of
Boatmen's and its subsidiaries as of June 30, 1994 and June 30,
1993 and the related unaudited consolidated income statements for
the six months then ended included in Boatmen's Quarterly Reports
on Form 10Q for the quarters then ended, as currently on file with
the S.E.C. (together, the "Boatmen's Financial Statements"), have
been prepared in accordance with generally accepted accounting
principles applied on a consistent basis (except as disclosed
therein) and fairly present in all material respects the
consolidated financial position and the consolidated results of
operations, changes in stockholders' equity and cash flows of
Boatmen's and its consolidated subsidiaries as of the dates and for
the periods indicated (subject, in the case of interim financial
statements, to normal recurring year-end adjustments, none of which
will be material).

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SECTION 3.05. ABSENCE OF CHANGES. Since December 31, 1993,
------------ ------------------
there has not been any material adverse change in the financial
condition, the results of operations or the business of Boatmen's
and its subsidiaries taken as a whole, nor have there been any
events or transactions having such a material adverse effect which
should be disclosed in order to make the Boatmen's Financial
Statements not misleading.

SECTION 3.06. LITIGATION. There is no litigation, claim or
------------ ----------
other proceeding pending or, to the knowledge of Boatmen's,
threatened, against Boatmen's or any of its subsidiaries, or of
which the property of Boatmen's or any of its subsidiaries is or
would be subject which would have a material adverse effect on the
business of Boatmen's and its subsidiaries taken as a whole.

SECTION 3.07. REPORTS. Boatmen's and each of its significant
------------ -------
subsidiaries has filed all material reports and statements,
together with any amendments required to be made with respect
thereto, that it was required to file with (i) the S.E.C., (ii) the
Federal Reserve Board, (iii) the Office of the Comptroller of the
Currency, (iv) the FDIC, (v) any applicable state securities or
banking authorities having jurisdiction, (vi) Nasdaq, and (vii) any
other governmental authority with jurisdiction over Boatmen's or
any of its significant subsidiaries. As of their respective dates,
each of such reports and documents, as amended, including the
financial statements, exhibits and schedules thereto, complied in
all material respects with the relevant statutes, rules and
regulations enforced or promulgated by the regulatory authority
with which they were filed, and did not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading.

SECTION 3.08. COMPLIANCE WITH LAW. Boatmen's and its
------------ -------------------
significant subsidiaries have all licenses, franchises, permits and
other governmental authorizations that are legally required to
enable them to conduct their respective businesses in all material
respects and are in compliance in all material respects with all
applicable laws and regulations.

SECTION 3.09. STATEMENTS TRUE AND CORRECT. None of the
------------ ---------------------------
information supplied or to be supplied by Boatmen's or
AcquisitionCo for inclusion in (i) the Registration Statement (as
defined below), (ii) the Proxy Statement/Prospectus (as defined
below) and (iii) any other documents to be filed with the S.E.C. or
any banking or other regulatory authority in connection with the
transactions contemplated hereby, will, at the respective times
such documents are filed, and, in the case of the Registration
Statement, when it becomes effective, and with respect to the Proxy
Statement/Prospectus, when first mailed to the stockholders of
Company and Bank and at the time of such stockholders meetings,
contain any untrue statement of a material fact, or omit to state
any material fact necessary in order to make the statements made
therein, in light of the circumstances under which they are made,
not misleading. All documents that Boatmen's is responsible for
filing with the S.E.C. or any other regulatory authority in
connection with the transactions contemplated hereby will comply as
to form in all material respects with the provisions of applicable
law and any rules and regulations thereunder.

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ARTICLE FOUR
------------

AGREEMENTS OF COMPANY
---------------------

SECTION 4.01. BUSINESS IN ORDINARY COURSE. (a) Company shall
------------ ---------------------------
not declare or pay any dividend or make any other distribution to
shareholders, whether in cash, stock or other property, after the
date of this Agreement. Bank shall not declare or pay any dividend
or make any other distribution to its shareholders, whether in
cash, stock or other property after the date of this Agreement;
provided, however, Bank may declare and pay cash dividends in the
minimum amount necessary to enable the Company to meet its existing
debt amortization obligations.

(b) Company shall, and shall cause Bank to, continue to carry
on after the date hereof its respective business and the discharge
or incurrence of obligations and liabilities, only in the usual,
regular and ordinary course of business, as heretofore conducted,
and by way of amplification and not limitation, Company and Bank
will not, without the prior written consent of Boatmen's (which
shall not be unreasonably withheld):

(i) issue any Company Common or other capital stock or
any options, warrants, or other rights to subscribe for or
purchase Company Common or any other capital stock or any
securities convertible into or exchangeable for any capital
stock of Company or Bank; or

(ii) directly or indirectly redeem, purchase or otherwise
acquire any Company Common or any other capital stock of
Company or Bank; or

(iii) effect a reclassification, recapitalization,
splitup, exchange of shares, readjustment or other similar
change in or to any capital stock or otherwise reorganize or
recapitalize; or

(iv) change its certificate or articles of incorporation
or association, as the case may be, or bylaws; or

(v) grant any increase, other than ordinary and normal
increases consistent with past practices, in the compensation
payable or to become payable to officers or salaried
employees, grant any stock options or, except as required by
law, adopt or make any change in any bonus, insurance,
pension, or other Employee Plan, agreement, payment or
arrangement made to, for or with any of such officers or
employees (provided that Company and Bank may pay its ordinary
officer bonuses and its ordinary director bonuses for calendar
year 1994 not to exceed in the aggregate the amounts thereof
paid in 1993); or

(vi) borrow or agree to borrow any amount of funds except
in the ordinary course of business, or directly or indirectly
guarantee or agree to guarantee any obligations of others; or

(vii) make or commit to make any new loan or letter of
credit or any new or additional discretionary advance under
any existing line of credit, in principal amounts in excess of
$250,000 or that would increase the aggregate credit
outstanding to any one borrower (or group of affiliated
borrowers) to more than $250,000 (excluding for this purpose
any accrued interest or overdrafts), without the prior written
consent of Boatmen's, acting through its Executive Vice
President-Loan Administration or such other designee as
Boatmen's may give notice of to Company; or

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(viii) purchase or otherwise acquire any investment
security for its own account having an average remaining life
to maturity greater than five years or any asset-backed
securities other than those issued or guaranteed by the
Government National Mortgage Association, the Federal National
Mortgage Association or the Federal Home Loan Mortgage
Corporation; or

(ix) increase or decrease the rate of interest paid on
time deposits, or on certificates of deposit, except in a
manner and pursuant to policies consistent with past
practices; or

(x) enter into any agreement, contract or commitment out
of the ordinary course of business or having a term in excess
of three (3) months other than letters of credit, loan
agreements, deposit agreements, and other lending, credit and
deposit agreements and documents made in the ordinary course
of business; or

(xi) except in the ordinary course of business, place on
any of its assets or properties any mortgage, pledge, lien,
charge, or other encumbrance; or

(xii) except in the ordinary course of business, cancel or
accelerate any material indebtedness owing to Company or Bank
or any claims which Company or Bank may possess or waive any
material rights of substantial value; or

(xiii) sell or otherwise dispose of any real property or
any material amount of any tangible or intangible personal
property other than properties acquired in foreclosure or
otherwise in the ordinary collection of indebtedness to
Company and Bank; or

(xiv) foreclose upon or otherwise take title to or
possession or control of any real property without first
obtaining a phase one environmental report thereon which
indicates that the property is free of pollutants,
contaminants or hazardous or toxic waste materials; provided,
however, that Company and Bank shall not be required to obtain
such a report with respect to single family, non-agricultural
residential property of one acre or less to be foreclosed upon
unless it has reason to believe that such property might
contain any such waste materials or otherwise might be
contaminated; or

(xv) commit any act or fail to do any act which will
cause a breach of any agreement, contract or commitment and
which will have a material adverse effect on Company's and
Bank's business, financial condition, or earnings;

(xvi) violate any law, statute, rule, governmental
regulation, or order, which violation might have a material
adverse effect on Company's and its subsidiaries' business,
financial condition, or earnings; or

(xvii) purchase any real or personal property or make any
other capital expenditure where the amount paid or committed
therefor is in excess of $50,000.

(c) Company and Bank shall not, without the prior written
consent of Boatmen's, engage in any transaction or take any action
that would render untrue in any material respect any of the
representations and warranties of Company contained in Article Two
hereof, if such representations and warranties were given as of the
date of such transaction or action.

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(d) Company shall promptly notify Boatmen's in writing of the
occurrence of any matter or event known to and directly involving
Company, which would not include any changes in conditions that
affect the banking industry generally, that is materially adverse
to the business, operations, properties, assets, or condition
(financial or otherwise) of Company and Bank taken as a whole.

(e) Company shall not, on or before the earlier of the Closing
Date or the date of termination of this Agreement, solicit or
encourage, or, subject to the fiduciary duties of its directors as
advised by counsel, hold discussions or negotiations with or
provide any information to, any person in connection with, any
proposal from any person for the acquisition of all or any
substantial portion of the business, assets, shares of Company
Common or other securities of Company and Bank. Company shall
promptly advise Boatmen's of its receipt of any such proposal or
inquiry concerning any possible such proposal, and the substance of
such proposal or inquiry.

SECTION 4.02. BREACHES. Company shall, in the event it has
------------ --------
knowledge of the occurrence, or impending or threatened occurrence,
of any event or condition which would cause or constitute a breach
(or would have caused or constituted a breach had such event
occurred or been known prior to the date hereof) of any of its
representations or agreements contained or referred to herein, give
prompt written notice thereof to Boatmen's and use its best efforts
to prevent or promptly remedy the same.

SECTION 4.03. SUBSIDIARY BANK MERGER. Company shall cause
------------ ----------------------
Bank to enter into the form of Subsidiary Bank Merger Agreement
attached hereto as Exhibit 4.03 with Boatmen's Bank of South
Central Illinois ("Boatmen's Bank"), which is a wholly owned
subsidiary of Boatmen's, and take all other actions (including
voting its shares of Bank in favor of the Subsidiary Bank Merger
Agreement) and cooperate with Boatmen's, and Boatmen's Bank in
causing such merger (the "Subsidiary Bank Merger") to be effected.

SECTION 4.04. SUBMISSION TO SHAREHOLDERS. Company shall
------------ --------------------------
cause to be duly called and held, on a date mutually selected by
Boatmen's and Company, a special meeting of its shareholders and
the shareholders of the Bank (the "Stockholders' Meetings") for
submission, in the case of Company, of this Agreement and the
Merger for approval of such Company shareholders as required by the
Corporate Law and, in the case of Bank, the Subsidiary Bank Merger
Agreement and the Subsidiary Bank Merger for the approval of such
Bank shareholders as required by applicable law. In connection
with the Stockholders' Meetings, (i) Company shall cooperate and
assist Boatmen's in preparing and filing a Proxy
Statement/Prospectus (the "Proxy Statement/Prospectus") with the
S.E.C. and Company shall mail it to its stockholders and cause Bank
to mail it to its stockholders, (ii) Company shall furnish
Boatmen's all information concerning itself that Boatmen's may
reasonably request in connection with such Proxy
Statement/Prospectus, and (iii) the Board of Directors of Company
shall (subject to compliance with its fiduciary duties as advised
by counsel) recommend to its stockholders the approval of this
Agreement and the Merger contemplated hereby and use its best
efforts to obtain such stockholder approval.

SECTION 4.05. CONSENTS TO CONTRACTS AND LEASES. Company
------------ --------------------------------
shall use its best efforts to obtain all necessary consents with
respect to all interests of Company and Bank in any material
leases, licenses, contracts, instruments and rights which require
the consent of another person for their transfer or assumption pur-
suant to the Merger or the Subsidiary Bank Merger, if any.

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125

SECTION 4.06. CONFORMING ACCOUNTING AND RESERVE POLICIES;
------------ -------------------------------------------
RESTRUCTURING EXPENSES.
- ----------------------

(a) Notwithstanding that the Company believes that it and Bank
have established all reserves and taken all provisions for possible
loan losses required by generally accepted accounting principles
and applicable laws, rules and regulations, the Company recognizes
that Boatmen's may have adopted different loan, accrual and reserve
policies (including loan classifications and levels of reserves for
possible loan losses). From and after the date of this Agreement
to the Effective Time, the Company and Boatmen's shall consult and
cooperate with each other with respect to conforming, as specified
in a written notice from Boatmen's to the Company, based upon such
consultation and as hereinafter provided, the loan, accrual and
reserve policies of Company and Bank to those policies of
Boatmen's.

(b) In addition, from and after the date of this Agreement to
the Effective Time, the Company and Boatmen's shall consult and
cooperate with each other with respect to determining, as specified
in a written notice from Boatmen's to the Company, based upon such
consultation and as hereinafter provided, appropriate accruals,
reserves and charges to establish and take in respect of excess
equipment write-off or write-down of various assets and other
appropriate charges and accounting adjustments taking into account
the parties' business plans following the Merger.

(c) The Company and Boatmen's shall consult and cooperate with
each other with respect to determining, as specified in a written
notice from Boatmen's to the Company, based upon such consultation
and as hereinafter provided, the amount and the timing for
recognizing for financial accounting purposes the expenses of the
Merger and the restructuring charges related to or to be incurred
in connection with the Merger.

(d) At the request of Boatmen's, the Company shall establish
and take such reserves and accruals as Boatmen's shall request to
conform the Company's loan, accrual and reserve policies to
Boatmen's policies, shall establish and take such accruals,
reserves and charges in order to implement such policies in respect
of excess facilities and equipment capacity, severance costs,
litigation matters, write-off or write-down of various assets and
other appropriate accounting adjustments, and to recognize for
financial accounting purposes such expenses of the Merger and
restructuring charges related to or to be incurred in connection
with the Merger, in each case at such times as are mutually
agreeable to Boatmen's and Company; provided, however, that it is
the objective of Boatmen's and Company that such reserves, accruals
and charges referred to in this Section 4.06 be taken as at or
immediately prior to December 31, 1994, and, in all events, not
later than as of immediately prior to the Closing Date, provided
that if such reserves, accruals and charges are to be taken as at
or prior to December 31, 1994 and the Closing Date is to occur
thereafter, Boatmen's shall certify to Company on or prior to
January 15, 1995, that the bank regulatory approval conditions to
its obligations contemplated by Section 6.01(d) have been satisfied
or waived (except to the extent that any waiting period associated
therewith may then have commenced but not expired) and Boatmen's
and Company shall have mutually agreed by January 15, 1995 to the
scheduling of the Closing Date to be no later than February 28,
1995; and provided, further, that Company shall not be required to
take any such action that is not consistent with accepted
accounting principles.

SECTION 4.07. CONSUMMATION OF AGREEMENT. Company shall use
------------ -------------------------
its best efforts to perform and fulfill all conditions and obli-
gations on its part to be performed or fulfilled under this
Agreement and to effect the Merger in accordance with the terms and
provisions hereof. Company shall furnish to Boatmen's in a timely
manner all information, data and documents in the possession of
Company

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126
requested by Boatmen's as may be required to obtain any necessary regulatory
or other approvals of the Merger or to file with the S.E.C. a registration
statement on Form S-4 (the "Registration Statement") relating to the shares of
Boatmen's Common to be issued to the shareholders of Company pursuant to the
Merger and this Agreement and shall otherwise cooperate fully with
Boatmen's to carry out the purpose and intent of this Agreement.

SECTION 4.08. ENVIRONMENTAL REPORTS. Company shall provide
------------ ---------------------
to Boatmen's, as soon as reasonably practical, but not later than
45 days after the date hereof, a report of a phase one
environmental investigation on all real property owned, leased or
operated by Company or Bank as of the date hereof (but excluding
space in retail and similar establishments leased by the Company
for automatic teller machines or other leased premises where the
space leased comprises less than 25% of the total space leased to
all tenants of such property) and within ten days after the
acquisition or lease of any real property acquired or leased by
Company or Bank after the date hereof (but excluding space in
retail and similar establishments leased by the Company for
automatic teller machines or other leased premises where the space
leased comprises less than 25% of the total space leased to all
tenants of such property), except as otherwise provided in
Section 4.01(b)(xiv). If required by the phase one investigation
in Boatmen's reasonable opinion, Company shall provide to Boatmen's
a report of a phase two investigation on properties requiring such
additional study. Should the cost of taking all remedial and
corrective actions and measures (i) required by applicable law, or
(ii) recommended or suggested by such report or reports or prudent
in light of serious life, health or safety concerns, in the
aggregate, exceed the sum of Two Hundred Fifty Thousand Dollars
($250,000) as reasonably estimated by an environmental expert
retained for such purpose by Boatmen's and reasonably acceptable to
Company, or if the cost of such actions and measures cannot be so
reasonably estimated by such expert to be $250,000 or less with any
reasonable degree of certainty, then Boatmen's shall have the right
pursuant to Section 7.03 hereof, for a period of 10 business days
following receipt of such estimate or indication that the cost of
such actions and measures can not be so reasonably estimated, to
terminate this Agreement, which shall be Boatmen's sole remedy in
such event.

SECTION 4.09. RESTRICTION ON RESALES. Company shall obtain
------------ ----------------------
and deliver to Boatmen's, at least 31 days prior to the Closing
Date, the signed agreement, in the form of Exhibit 4.09 hereto, of
each person who may reasonably be deemed an "affiliate" of Company
or Bank within the meaning of such term as used in Rule 145 under
the Securities Act of 1933, as amended (the "Securities Act"),
regarding (i) compliance with the provisions of such Rule 145, and
(ii) compliance with the requirements of Accounting Principles
Board Opinion No. 16 regarding the disposition of shares of Company
Common or Boatmen's Common (or reduction of risk with respect
thereto) until such time as financial results covering at least 30
days of post-Merger combined operations have been published.

SECTION 4.10. ACCESS TO INFORMATION. Company shall permit
------------ ---------------------
Boatmen's reasonable access in a manner which will avoid undue
disruption or interference with Company's normal operations to its
properties and shall disclose and make available to Boatmen's all
books, documents, papers and records relating to its assets, stock,
ownership, properties, operations, obligations and liabilities,
including, but not limited to, all books of account (including the
general ledger), tax records, minute books of directors' and
stockholders' meetings, organizational documents, material
contracts and agreements, loan files, filings with any regulatory
authority, accountants' workpapers (if available and subject to the
respective independent accountants' consent), litigation files (but
only to the extent that such review would not result in a material
waiver of the attorney-client or attorney work product privileges
under the rules of evidence), plans affecting employees, and any
other business activities or prospects in which Boatmen's

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may have a reasonable and legitimate interest in furtherance of the
transactions contemplated by this Agreement. Company shall deliver
to Boatmen's within ten (10) days after the date hereof a true,
accurate and complete copy of each written plan or program
disclosed in Section 2.12(c) of the Disclosure Schedule and, with
respect to each such plan or program, all (i) amendments or
supplements thereto, (ii) summary plan descriptions, (iii) lists of
all current participants and all participants with benefit
entitlements, (iv) contracts relating to plan documents,
(v) actuarial valuations for any defined benefit plan, (vi)
valuations for any plan as of the most recent date,
(vii) determination letters from the Internal Revenue Service,
(viii) the most recent annual report filed with the Internal
Revenue Service, and (ix) trust agreements. Boatmen's will hold
any such information which is nonpublic in confidence in accordance
with the provisions of Section 8.01 hereof.

ARTICLE FIVE
------------

AGREEMENTS OF BOATMEN'S AND ACQUISITIONCO
-----------------------------------------

SECTION 5.01. REGULATORY APPROVALS AND REGISTRATION
------------ -------------------------------------
STATEMENT. Boatmen's shall file all regulatory applications
- ---------
required in order to consummate the Merger and the Subsidiary Bank
Merger, including but not limited to the necessary applications for
the prior approval of the Federal Reserve Board, the Commissioner
of Banks and Trust Companies of the State of Illinois and the FDIC.
Boatmen's shall keep Company reasonably informed as to the status
of such applications and provide to Company copies of such
applications and any supplementally filed materials. Boatmen's
shall file with the S.E.C. the Registration Statement relating to
the shares of Boatmen's Common to be issued to the stockholders of
Company and Bank pursuant to this Agreement and the Subsidiary Bank
Merger Agreement, and shall use its best efforts to cause the
Registration Statement to become effective. At the time the
Registration Statement becomes effective, the Registration
Statement shall comply in all material respects with the provisions
of the Securities Act and the published rules and regulations
thereunder, and shall not contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
false or misleading, and at the time of mailing thereof to the
stockholders of Company and Bank, at the time of the Stockholders'
Meetings and at the Effective Time the Proxy Statement/Prospectus
included as part of the Registration Statement, as amended or
supplemented by any amendment or supplement, shall not contain any
untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not false or
misleading. Boatmen's shall timely file all documents required to
obtain all necessary Blue Sky permits and approvals, if any,
required to carry out the transactions contemplated by this
Agreement, shall pay all expenses incident thereto and shall use
its best efforts to obtain such permits and approvals on a timely
basis. Boatmen's shall promptly and properly prepare and file
(i) any application required to list on Nasdaq the shares of
Boatmen's Common to be issued pursuant to the Merger and the
Subsidiary Bank Merger, and (ii) any filings required under the
Securities Exchange Act of 1934 (the "Exchange Act") relating to
the Merger and the transactions contemplated herein.

SECTION 5.02. BREACHES. Boatmen's shall, in the event it has
------------ --------
knowledge of the occurrence, or impending or threatened occurrence,
of any event or condition which would cause or constitute a breach
(or would have caused or constituted a breach had such event
occurred or been known prior to the date hereof) of any of its
representations or agreements contained or referred to herein, give
prompt written notice thereof to Company and use its best efforts
to prevent or promptly remedy the same.

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SECTION 5.03. CONSUMMATION OF AGREEMENT. Boatmen's and
------------ -------------------------
AcquisitionCo shall use their respective best efforts to perform
and fulfill all conditions and obligations on their part to be
performed or fulfilled under this Agreement and to effect the
Merger in accordance with the terms and conditions of this
Agreement.

SECTION 5.04. DIRECTORS AND OFFICERS' LIABILITY INSURANCE AND
------------ -----------------------------------------------
INDEMNIFICATION.
- ---------------

(a) Following the Effective Time, Boatmen's will provide the
directors and officers of Company and Bank with the same directors'
and officers' liability insurance coverage that Boatmen's provides
to directors and officers of its other banking subsidiaries
generally, and, in addition, for a period of three years will use
its best efforts to continue the Company's and Bank's directors'
and officers' liability insurance coverage with respect to actions
occurring prior to the Effective Time to the extent that such
coverage is obtainable for an aggregate premium not to exceed the
annual premium presently being paid by Company. If the aggregate
premium of such insurance would exceed such maximum amount,
Boatmen's shall use its best efforts to procure such level of
insurance having the coverage described above as can be obtained
for an aggregate premium equal to such maximum amount.

(b) For six years after the Effective Time, Boatmen's shall
cause the Surviving Corporation (the survivor of the Merger of
Company and AcquisitionCo following the Effective Time, the
"Surviving Corporation") to indemnify, defend and hold harmless the
present and former officers, directors, employees and agents of
Company and Bank (each, an "Indemnified Party") against all losses,
expenses, claims, damages or liabilities arising out of actions or
omissions occurring on or prior to the Effective Time (including,
without limitation, the transactions contemplated by this Agreement
and the Subsidiary Bank Merger Agreement) to the full extent then
permitted under the Corporate Law and by the Company's Articles of
Incorporation as in effect on the date hereof, including provisions
relating to advances of expenses incurred in the defense of any
action or suit.

(c) If after the Effective Time the Surviving Corporation or
any of its successors or assigns (i) shall consolidate with or
merge into any other corporation or entity and shall not be the
continuing or surviving corporation or entity of such consolidation
or merger or (ii) shall transfer all or substantially all of its
properties and assets to any individual, corporation or other
entity, then and in each such case, proper provision shall be made
so that the successors and assigns of the Surviving Corporation
shall assume any remaining obligations set forth in this Section
5.04. If the Surviving Corporation shall liquidate, dissolve or
otherwise wind up its business, then Boatmen's shall indemnify,
defend and hold harmless each Indemnified Party to the same extent
and on the same terms that the Surviving Corporation was so
obligated pursuant to this Section 5.04.

SECTION 5.05. EMPLOYEE BENEFITS. Boatmen's shall, with
------------ -----------------
respect to each person who remains an employee of Company or Bank
following the Closing Date (each a "Continued Employee"), provide
the benefits described in this Section 5.05. Subject to the right
of subsequent amendment or termination in Boatmen's discretion,
each Continued Employee shall be entitled, as a new employee of a
subsidiary of Boatmen's, to participate in such employee benefit
plans, as defined in Section 3(3) of ERISA, or any non-qualified
employee benefit plans or deferred compensation, stock option,
bonus or incentive plans, or other employee benefit or fringe
benefit programs that may be in effect generally for employees of
all of Boatmen's subsidiaries (the "Boatmen's Plans"), if and as a
Continued Employee shall be eligible and, if required, selected for
participation therein and otherwise shall not be participating in
a similar plan maintained by the Company after the Effective Time.
Company employees will be eligible to participate

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on the same basis as similarly situated employees of other Boatmen's
subsidiaries. All such participation shall be subject to such terms of such
plans as may be in effect from time to time and this Section 5.05 is not
intended to give Continued Employees any rights or privileges
superior to those of other employees of Boatmen's subsidiaries.
Boatmen's may terminate or modify all Employee Plans except insofar
as benefits thereunder shall have vested on the Closing Date and
cannot be modified and Boatmen's obligation under this Section 5.05
shall not be deemed or construed so as to provide duplication of
similar benefits but, subject to that qualification, Boatmen's
shall, for purposes of vesting and any age or period of service
requirements for commencement of participation with respect to any
Boatmen's Plans in which Continued Employees may participate,
credit each Continued Employee with his or her term of service with
Company and Bank.

SECTION 5.06. SUBSIDIARY BANK MERGER. Boatmen's shall cause
------------ ----------------------
Boatmen's Bank to enter into the form of Subsidiary Bank Merger
Agreement, attached hereto as Exhibit 4.03, with Bank and take all
other actions (including voting its shares of Boatmen's Bank in
favor of the Subsidiary Bank Merger) and cooperate with Bank in
causing the Subsidiary Bank Merger to be effected.

SECTION 5.07. ACCESS TO INFORMATION. Boatmen's shall permit
------------ ---------------------
Company reasonable access in a manner which will avoid undue
disruption or interference with Boatmen's normal operations to its
properties and shall disclose and make available to Company all
books, documents, papers and records relating to its assets, stock,
ownership, properties, operations, obligations and liabilities,
including, but not limited to, all books of account (including the
general ledger), tax records, minute books of directors' and
stockholders' meetings, organizational documents, material
contracts and agreements, loan files, filings with any regulatory
authority, accountants' workpapers (if available and subject to the
respective independent accountants' consent), litigation files,
plans affecting employees, and any other business activities or
prospects in which Company may have a reasonable and legitimate
interest in furtherance of the transactions contemplated by this
Agreement. Company will hold any such information which is
nonpublic in confidence in accordance with the provisions of
Section 8.01 hereof.

ARTICLE SIX
-----------

CONDITIONS PRECEDENT TO THE MERGER
----------------------------------

SECTION 6.01. CONDITIONS TO BOATMEN'S OBLIGATIONS. Boatmen's
------------ -----------------------------------
and AcquisitionCo's obligations to effect the Merger shall be
subject to the satisfaction (or waiver by Boatmen's) prior to or on
the Closing Date of the following conditions:

(a) The representations and warranties made by Company in this
Agreement shall be true in all material respects on and as of the
Closing Date with the same effect as though such representations
and warranties had been made or given on and as of the Closing
Date;

(b) Company shall have performed and complied in all material
respects with all of its obligations and agreements required to be
performed prior to the Closing Date under this Agreement;

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authority or other person seeking any of the foregoing be pending. There
shall not be any action taken, or any statute, rule, regulation or
order enacted, entered, enforced or deemed applicable to the Merger
which makes the consummation of the Merger illegal;

(d) All necessary regulatory approvals, consents,
authorizations and other approvals required by law for consummation
of the Merger shall have been obtained and all waiting periods
required by law shall have expired;

(e) Boatmen's shall have received all documents required to
be received from Company on or prior to the Closing Date, all in
form and substance reasonably satisfactory to Boatmen's;

(f) Boatmen's shall have received an opinion letter, dated as
of the Closing Date, from Ernst & Young, its independent public
accountants, to the effect that the Merger and the Subsidiary Bank
Merger will qualify for pooling of interests accounting treatment
under Accounting Principles Board Opinion No. 16 if closed and
consummated in accordance with this Agreement and the Subsidiary
Bank Merger Agreement, respectively; except that this condition
shall be deemed to have been waived by Boatmen's if it takes any
action after the date of this Agreement without the written consent
of Company, which such action constitutes the sole reason for
Ernst & Young to be unable to render such opinion;

(g) The Registration Statement shall be effective under the
Securities Act and no stop orders suspending the effectiveness of
the Registration Statement shall be in effect or proceedings for
such purpose pending before or threatened by the S.E.C. or any
state securities agency;

(h) Boatmen's shall have received a ruling of the Internal
Revenue Service or an opinion of its counsel to the effect that if
the Merger is consummated in accordance with the terms set forth in
this Agreement and the Subsidiary Bank Merger is consummated in
accordance with the terms set forth in the Subsidiary Bank Merger
Agreement, (i) the Merger and Subsidiary Bank Merger will
constitute a reorganization within the meaning of Section 368(a) of
the Code; (ii) no gain or loss will be recognized by the holders of
shares of Company Common or Bank common stock upon receipt of
Merger Consideration (except for cash received in lieu of
fractional shares), in the case of Company, and the shares of
Boatmen's Common issuable pursuant to the Subsidiary Bank Merger
Agreement, in the case of Bank; (iii) the basis of shares of
Boatmen's Common received by the stockholders of Company or Bank
will be the same as the basis of shares of Company Common or Bank
common stock exchanged therefor; and (iv) the holding period of the
shares of Boatmen's Common received by such stockholders will
include the holding period of the shares of Company Common or Bank
common stock exchanged therefor, provided such shares were held as
capital assets as of the Effective Time; and

(i) The Subsidiary Bank Merger also shall be consummated on
the Closing Date.

SECTION 6.02. CONDITIONS TO COMPANY'S OBLIGATIONS. Company's
------------ -----------------------------------
obligation to effect the Merger shall be subject to the
satisfaction (or waiver by Company) prior to or on the Closing Date
of the following conditions:

(a) The representations and warranties made by Boatmen's and
AcquisitionCo in this Agreement shall be true in all material
respects on and as of the Closing Date with the same effect as
though such representations and warranties had been made or given
on the Closing Date;

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(b) Boatmen's and AcquisitionCo shall have performed and
complied in all material respects with all of their obligations and
agreements hereunder required to be performed prior to the Closing
Date under this Agreement;

(c) No temporary restraining order, preliminary or permanent
injunction or other order issued by any court of competent
jurisdiction or other legal restraint or prohibition (an
"Injunction") preventing the consummation of the Merger shall be in
effect, nor shall any proceeding by any bank regulatory authority
or other governmental agency seeking any of the foregoing be
pending. There shall not be any action taken, or any statute,
rule, regulation or order enacted, entered, enforced or deemed
applicable to the Merger which makes the consummation of the Merger
illegal;

(d) All necessary regulatory approvals, consents,
authorizations and other approvals, including the requisite
approval of this Agreement and the Merger by the shareholders of
Company, required by law for consummation of the Merger shall have
been obtained and all waiting periods required by law shall have
expired;

(e) Company shall have received all documents required to be
received from Boatmen's on or prior to the Closing Date, all in
form and substance reasonably satisfactory to Company;

(f) The Registration Statement shall be effective under the
Securities Act and no stop orders suspending the effectiveness of
the Registration Statement shall be in effect or proceedings for
such purpose pending before or threatened by the S.E.C. or any
state securities agency; and

(g) Company shall have received the ruling of the Internal
Revenue Service or the opinion of Boatmen's counsel contemplated by
Section 6.01(h) of this Agreement.

ARTICLE SEVEN
-------------

TERMINATION OR ABANDONMENT
--------------------------

SECTION 7.01. MUTUAL AGREEMENT. This Agreement may be
------------ ----------------
terminated by the mutual written agreement of Boatmen's and Company
at any time prior to the Closing Date, regardless of whether
shareholder approval of this Agreement and the Merger by the
shareholders of Company shall have been previously obtained.

SECTION 7.02. BREACH OF AGREEMENTS. In the event that there
------------ --------------------
is a material breach in any of the representations and warranties
or agreements of Boatmen's or Company, which breach is not cured
within thirty (30) days after notice to cure such breach is given
to the breaching party by the non-breaching party, then the non-
breaching party, regardless of whether shareholder approval of this
Agreement and the Merger shall have been previously obtained, may
terminate and cancel this Agreement by providing written notice of
such action to the other party hereto.

SECTION 7.03. ENVIRONMENTAL REPORTS. Boatmen's may terminate
------------ ---------------------
this Agreement to the extent provided by Section 4.08 and this
Section 7.03 by giving written notice thereof to Company.

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SECTION 7.04. FAILURE OF CONDITIONS. In the event any of the
------------ ---------------------
conditions to the obligations of either party are not satisfied or
waived on or prior to the Closing Date, and if any applicable cure
period provided in Section 7.02 hereof has lapsed, then such party
may, regardless of whether shareholder approval of this Agreement
and the Merger shall have been previously obtained, terminate and
cancel this Agreement by delivery of written notice of such action
to the other party on such date.

SECTION 7.05. REGULATORY APPROVAL DENIAL. If any regulatory
------------ --------------------------
application filed pursuant to Section 5.01 hereof should be finally
denied or disapproved by the respective regulatory authority, then
this Agreement thereupon shall be deemed terminated and canceled.
However, it is understood that a request for additional information
or undertaking by Boatmen's, as a condition for approval, shall not
be deemed to be a denial or disapproval so long as Boatmen's
diligently provides the requested information or undertaking. In
the event an application is denied pending an appeal, petition for
review, or similar such act on the part of Boatmen's (hereinafter
referred to as the "appeal") then the application will be deemed
denied unless Boatmen's prepares and timely files such appeal and
continues the appellate process for purposes of obtaining the
necessary approval.

SECTION 7.06. SHAREHOLDER APPROVAL DENIAL. If the Merger is
------------ ---------------------------
not approved by the requisite vote of the stockholders of Company
at the Stockholders' Meetings, then either party may terminate this
Agreement.

SECTION 7.07. REGULATORY ENFORCEMENT MATTERS. In the event
------------ ------------------------------
that Company or Bank shall become a party or subject to any new or
amended written agreement, memorandum of understanding, cease and
desist order, imposition of civil money penalties or other
regulatory enforcement action or proceeding with any federal or
state agency charged with the supervision or regulation of banks or
bank holding companies after the date of this Agreement, then
Boatmen's may terminate this Agreement.

SECTION 7.08. FALL-APART DATE. If the Closing Date does not
------------ ---------------
occur on or prior to the expiration of the first anniversary of the
date of this Agreement, then this Agreement may be terminated by
either party by giving written notice thereof to the other.

SECTION 7.09. TERMINATION FEE.
------------ ---------------

(a) Upon the occurrence of one or more of the following events
(a "Triggering Event"), Company shall pay to Boatmen's the sum of
Five Hundred Thousand Dollars ($500,000):

(i) upon termination of this Agreement by Boatmen's upon
a breach thereof by Company, provided that within twelve (12)
months of the date of such termination, an event described in
clause (ii) or (iii) below shall have occurred;

(ii) any person or group of persons (other than
Boatmen's) shall acquire, or have the right to acquire, 50% or
more of the outstanding voting shares of Company;

(iii) upon the entry by Company or Bank into an agreement
or other understanding with a person or group of persons
(other than Boatmen's and/or its affiliates) for such person
or group of persons to acquire, merge or consolidate with
Company or Bank or to purchase or acquire control of Company
or Bank or all or substantially all of Company's or Bank's
assets; and

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(iv) the failure of Company's shareholders to approve the
Merger and this Agreement at a meeting called for such
purpose; provided, however, that the failure of the Company's
shareholders to approve the Merger and this Agreement at a
meeting called for such purpose shall not be deemed a
Triggering Event if: (A) the average of the daily closing
prices of a share of Boatmen's Common, as reported on Nasdaq
during the period of twenty (20) trading days ending on the
second trading day immediately preceding the date of mailing
to the shareholders of the Company notice of a meeting to vote
upon this Agreement and the Merger, together with the Proxy
Statement/Prospectus relating thereto (the "Mailing Date")
(the "Boatmen's Final Price"), is less than $26.00; and
(B) the number obtained by dividing the Boatmen's Final Price
by the Boatmen's Initial Price (as defined below), is less
than the number obtained by dividing the Final Index Price (as
defined below) by the Initial Index Price (as defined below)
and subtracting .20 from such quotient.

(b) As used in this Section 7.09:

(i) "person" and "group of persons" shall have the
meanings conferred thereon by Section 13(d) of the Exchange
Act.

(ii) The "Index Group" shall mean all of those companies
listed on Exhibit 7.09, the common stock of which is publicly
traded and as to which there is no pending publicly announced
proposal at any time during the period of 20 trading days
ending at the end of the fifth trading day immediately
preceding the Closing Date for such company to be acquired or
to acquire another company in exchange for its stock where, in
such later case, such company to be acquired would be a
significant subsidiary of such acquiring company (as such term
is defined in Section 3.03 hereof). In the event that any
such company or companies are so removed from the Index Group,
the weights attributed to the remaining companies shall be
adjusted accordingly.

(iii) The "Initial Boatmen's Price" shall be the closing
price of a share of Boatmen's Common on the date of this
Agreement. The "Initial Index Price" shall mean the weighted
average (weighted in accordance with the factors listed on
Exhibit 7.09) of the per share closing prices of the common
stock of the companies comprising the Index Group, as reported
on the consolidated transactions reporting system for the
market or exchange on which such common stock is principally
traded, on the date of this Agreement.

(iv) The "Final Price" of any company belonging to the
Index Group shall mean the average of the daily closing sale
prices of a share of common stock of such company, as reported
in the consolidated transaction reporting system for the
market or exchange on which such common stock is principally
traded, during the period of 20 trading days ending on the end
of the second trading day immediately preceding the Mailing
Date.

(v) The "Final Index Price" shall mean the weighted
average (weighted in accordance with the factors listed on
Exhibit 7.09) of the Final Prices for all of the companies
comprising the Index Group.

If Boatmen's or any company included in the Index Group
declares a stock dividend or effects a reclassification,
recapitalization, split-up, combination, exchange of shares or
similar transaction between the date of this Agreement and the
end of the fifth trading day immediately preceding the

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Closing Date, the closing prices for the common stock of such company
shall be appropriately adjusted for the purposes of the
definitions above so as to be comparable to the prices on the
date of this Agreement.

Company shall notify Boatmen's promptly in writing upon its
becoming aware of the occurrence of any Triggering Event.

SECTION 7.10. DUE DILIGENCE REVIEW. In accordance with
------------ --------------------
Section 4.10, Company shall provide Boatmen's full and complete
access to its books, records and staff and those of Bank to
facilitate Boatmen's due diligence review of the financial
condition, business and prospects of Company and Bank. If
Boatmen's, in its sole and absolute discretion, should not be
satisfied with the results of such due diligence review or the
financial condition, business or prospects of Company and Bank
generally, then Boatmen's may terminate this Agreement by providing
written notice thereof to Company by the later of (i) the thirtieth
(30th) day after the date of this Agreement or (ii) the third (3rd)
business day after Company delivers to Boatmen's a copy of
Company's audited Financial Statements for the fiscal year ended
December 31, 1993 (the "Due Diligence Period").

ARTICLE EIGHT
-------------

GENERAL
-------

SECTION 8.01. CONFIDENTIAL INFORMATION. The parties
------------ ------------------------
acknowledge the confidential and proprietary nature of the
"Information" (as herein described) which has heretofore been
exchanged and which will be received from each other hereunder and
agree to hold and keep the same confidential. Such Information
will include any and all financial, technical, commercial,
marketing, customer or other information concerning the business,
operations and affairs of a party that may be provided to the
other, irrespective of the form of the communications, by such
party's employees or agents. Such Information shall not include
information which is or becomes generally available to the public
other than as a result of a disclosure by a party or its
representatives in violation of this Agreement. The parties agree
that the Information will be used solely for the purposes
contemplated by this Agreement and that such Information will not
be disclosed to any person other than employees and agents of a
party who are directly involved in evaluating the transaction. The
Information shall not be used in any way detrimental to a party,
including use directly or indirectly in the conduct of the other
party's business or any business or enterprise in which such party
may have an interest, now or in the future, and whether or not now
in competition with such other party.

SECTION 8.02. PUBLICITY. Boatmen's and Company shall
------------ ---------
cooperate with each other in the development and distribution of
all news releases and other public disclosures concerning this
Agreement and the Merger and shall not issue any news release or
make any other public disclosure without the prior consent of the
other party, unless it reasonably believes such is required by law
upon the advice of counsel or is in response to published newspaper
or other mass media reports regarding the transaction contemplated
hereby, in which such latter event the parties shall give
reasonable notice, and to the extent practicable, consult with each
other regarding such responsive public disclosure.

SECTION 8.03. RETURN OF DOCUMENTS. Upon termination of this
------------ -------------------
Agreement without the Merger becoming effective, each party shall
deliver to the other originals and all copies of all Information
made

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available to such party and will not retain any copies, extracts or other
reproductions in whole or in part of such Information.

SECTION 8.04. NOTICES. Any notice or other communication
------------ -------
shall be in writing and shall be deemed to have been given or made
on the date of delivery, in the case of hand delivery, or three (3)
business days after deposit in the United States Registered Mail,
postage prepaid, or upon receipt if transmitted by facsimile
telecopy or any other means, addressed (in any case) as follows:

(a) if to Boatmen's:

Boatmen's Bancshares, Inc.
One Boatmen's Plaza
800 Market Street
St. Louis, Missouri 63102
Attention: Mr. Leo G. Haas
Facsimile: 314/466-5645

with a copy to:

Lewis, Rice & Fingersh
500 North Broadway, Suite 2000
St. Louis, Missouri 63102
Attention: Mr. Thomas C. Erb
Facsimile: 314/241-6056

and

(b) if to Company:

Salem Community Bancorp, Inc.
401 West Main Street, P.O. Box 880
Salem, Illinois 62881
Attention: Mr. Robert W. Montgomery

with copies to:

Suelthaus & Kaplan
7733 Forsyth Blvd., 12th Floor
Clayton, Missouri 63105
Attention: Mr. Joseph T. Porter, Jr.

or to such other address as any party may from time to time
designate by notice to the others.

SECTION 8.05. LIABILITIES. In the event that this Agreement
------------ -----------
is terminated pursuant to the provisions of Article Seven hereof,
no party hereto shall have any liability to any other party for
costs, expenses, damages or otherwise; provided, however, that,
notwithstanding the foregoing, in the event that this Agreement is
terminated pursuant to Section 7.02 hereof on account of a willful
breach of any

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of the representations and warranties set forth herein or any breach of
any of the agreements set forth herein, then the non-breaching party shall be
entitled to recover appropriate damages from the breaching party.

SECTION 8.06. NONSURVIVAL OF REPRESENTATIONS, WARRANTIES AND
------------ ----------------------------------------------
AGREEMENTS. Except for and as provided in this Section 8.06, no
- ----------
representation, warranty or agreement contained in this Agreement
shall survive the Effective Time or the earlier termination of this
Agreement. The agreements set forth in Sections 5.04, 5.05 and
5.06 shall survive the Effective Time and the covenants set forth
in Sections 1.07, 7.09, 8.01, 8.02, 8.03 and 8.05 shall survive the
Effective Time or the earlier termination of this Agreement.

SECTION 8.07. ENTIRE AGREEMENT. This Agreement and the
------------ ----------------
Subsidiary Bank Merger Agreement constitute the entire agreement
between the parties and supersede and cancel any and all prior
discussions, negotiations, undertakings, agreements in principle
and other agreements between the parties relating to the subject
matter hereof.

SECTION 8.08. HEADINGS AND CAPTIONS. The captions of
------------ ---------------------
Articles and Sections hereof are for convenience only and shall not
control or affect the meaning or construction of any of the
provisions of this Agreement.

SECTION 8.09. WAIVER, AMENDMENT OR MODIFICATION. The con-
------------ ---------------------------------
ditions of this Agreement which may be waived may only be waived by
notice to the other party waiving such condition. The failure of
any party at any time or times to require performance of any
provision hereof shall in no manner affect the right at a later
time to enforce the same. This Agreement may be amended or
modified by the parties hereto, at any time before or after
approval of the Agreement by the shareholders of Company; provided,
however, that after any such approval no such amendment or
modification shall alter the amount or change the form of the
Merger Consideration contemplated by this Agreement to be received
by shareholders of Company or alter or change any of the terms of
this Agreement if such alteration or change would adversely affect
the holders of Company Common. This Agreement not be amended or
modified except by a written document duly executed by the parties
hereto.

SECTION 8.10. RULES OF CONSTRUCTION. Unless the context
------------ ---------------------
otherwise requires: (i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles; (iii) "or" is not exclusive; and (iv) words in the
singular may include the plural and in the plural include the
singular.

SECTION 8.11. COUNTERPARTS. This Agreement may be executed
------------ ------------
in two or more counterparts, each of which shall be deemed an
original and all of which shall be deemed one and the same
instrument.

SECTION 8.12. SUCCESSORS AND ASSIGNS. This Agreement shall
------------ ----------------------
be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns. There shall be no third
party beneficiaries hereof.

SECTION 8.13. SEVERABILITY. In the event that any provisions
------------ ------------
of this Agreement or any portion thereof shall be finally
determined to be unlawful or unenforceable, such provision or
portion thereof shall be deemed to be severed from this Agreement,
and every other provision, and any portion of a provision, that is
not invalidated by such determination, shall remain in full force
and effect. To the

A-27
137
extent that a provision is deemed unenforceable
by virtue of its scope but may be made enforceable by limitation
thereof, such provision shall be enforceable to the fullest extent
permitted under the laws and public policies of the State whose
laws are deemed to cover enforceability. It is declared to be the
intention of the parties that they would have executed the
remaining provisions without including any that may be declared
unenforceable.

SECTION 8.14. GOVERNING LAW; ASSIGNMENT. This Agreement
------------ -------------------------
shall be governed by the laws of the State of Missouri, except to
the extent that the Corporate Law must govern aspects of the
Merger, and applicable federal laws and regulations. This
Agreement may not be assigned by either of the parties hereto.

IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.

BOATMEN'S BANCSHARES, INC.

By /s/ Leo G. Haas
----------------------------------------
Leo G. Haas
Senior Vice President

SALEM COMMUNITY BANCORP, INC.

By:/s/ Robert W. Montgomery
----------------------------------------
Robert W. Montgomery
President and Chief Executive Officer

BOATMEN'S-ILLINOIS, INC.

By:/s/ Leo G. Haas
----------------------------------------
Leo G. Haas
Vice President

A-28
138
EXHIBIT 1.09(a)
---------------

COMPANY'S LEGAL OPINION MATTERS

1. The due incorporation, valid existence and good standing
of Company under the laws of the State of Illinois, its power and
authority to own and operate its properties and to carry on its
business as now conducted, and its power and authority to enter
into the Agreement, to merge with Boatmen's-Illinois in accordance
with the terms of the Agreement and to consummate the transactions
contemplated by the Agreement.

2. The due organization of Bank as an Illinois state bank and
the valid existence of Bank under the laws of the State of
Illinois, its power and authority to own and operate its properties
and the possession of all licenses, permits and authorizations
necessary to carry on its business as now conducted.

3. With respect to Company, (i) the number of authorized, and
there being 7,684 issued and outstanding shares of capital stock of
Company on the Closing Date, (ii) the nonexistence of any violation
of the preemptive or subscription rights of any person, (iii) the
nonexistence of any outstanding options, warrants, or other rights
to acquire, or securities convertible into, any equity security of
Company, (iv) the nonexistence of any obligation, contingent or
otherwise, to reacquire any shares of capital stock of Company, and
(v) the nonexistence of any outstanding stock appreciation, phantom
stock or similar rights.

4. With respect to Bank, (i) the number of authorized, issued
and outstanding shares of capital stock of Bank on the Closing
Date, (ii) the nonexistence of any violation of the preemptive or
subscription rights of any person, (iii) the nonexistence of any
outstanding options, warrants, or other rights to acquire, or
securities convertible into, any equity securities of such Bank,
(iv) the nonexistence of any obligation, contingent or otherwise,
to reacquire any shares of capital stock of Bank, and (v) the
nonexistence of any outstanding stock appreciation, phantom stock
or similar rights.

5. Company's valid ownership of and title to 36,139 shares
of the 37,500 shares of outstanding capital stock of Bank, free and
clear of liens, security interests and encumbrances (excepting the
security interest of ----------------------------------------------
pursuant to that certain ------------------------------------------
- --------------------------------------------- dated --------------------).

6. The due and proper performance of all corporate acts and
other proceedings necessary or required to be taken by Company to
authorize the execution, delivery and performance of the Agreement,
the due execution and delivery of the Agreement by Company, and the
Agreement as a valid and binding obligation of the Company,
enforceable against Company in accordance with its terms (subject
to the provisions of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or similar laws affecting the
enforceability of creditors' rights generally from time to time in
effect, and equitable principles relating to the granting of
specific performance and other equitable remedies as a matter of
judicial discretion).

7. The due and proper performance of all corporate acts and
other proceedings necessary or required to be taken by Bank to
authorize the execution, delivery and performance of the Subsidiary
Bank

A-Ex. 1.09(a)-1
139
Merger Agreement, the due execution and delivery of the Subsidiary Bank Merger
Agreement by Bank, and the Subsidiary Bank Merger Agreement as a valid and
binding obligation of Bank, enforceable against Bank in accordance with its
terms (subject to the provisions of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or similar laws affecting the
enforceability of creditors' rights generally from time to time in
effect, and equitable principles relating to the granting of
specific performance and other equitable remedies as a matter of
judicial discretion).

8. The execution of the Agreement by Company, and the
consummation of the Merger and the other transactions contemplated
therein, does not violate or cause a default under their articles
of incorporation or bylaws, or any statute, regulation or rule or
any judgment, order or decree against or any material agreement
binding upon Company.

9. The execution of the Subsidiary Bank Merger Agreement by
Bank, and the consummation of the Subsidiary Bank Merger and the
other transactions contemplated therein, does not violate or cause
a default under its charter or bylaws, or any statute, regulation
or rule or any judgment, order or decree against or any material
agreement binding upon Bank.

10. The receipt of all required consents, approvals, orders
or authorizations of, or registrations, declaration or filings with
or notices to, any court, administrative agency or commission or
other governmental authority or instrumentality, domestic or
foreign, or any other person or entity required to be obtained or
made by Company and Bank in connection with the respective
execution and delivery of the Agreement and the Subsidiary Bank
Merger Agreement or the consummation of the transactions
contemplated therein.

11. The nonexistence of any material actions, suits,
proceedings, orders, investigations or claims pending or threatened
against or affecting Company or Bank which, if adversely
determined, would have a material adverse effect upon their
respective properties or assets or the transactions contemplated by
the Agreement and the Subsidiary Bank Merger Agreement.

A-Ex. 1.09(a)-2
140

EXHIBIT 1.09(b)
---------------

BOATMEN'S LEGAL OPINION MATTERS

1. The due incorporation, valid existence and good standing
of Boatmen's and Boatmen's-Illinois under the laws of the States of
Missouri and Illinois, respectively, and their respective power and
authority to enter into the Agreement and to consummate the
transactions contemplated thereby.

2. The due organization, valid existence and good standing
of Boatmen's Bank under the laws of the State of Illinois, and its
power and authority to enter into the Subsidiary Bank Merger
Agreement and to merge with Bank and to consummate the other
transactions contemplated by the Subsidiary Bank Merger Agreement.

3. The due and proper performance of all corporate acts and
other proceedings required to be taken by each of Boatmen's and
Boatmen's-Illinois to authorize the execution, delivery and
performance of the Agreement, their due execution and delivery of
the Agreement, and the Agreement as a valid and binding obligation
of Boatmen's and Boatmen's-Illinois enforceable against Boatmen's
and Boatmen's-Illinois in accordance with its terms (subject to the
provisions of bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforceability of creditors' rights
generally from time to time in effect, and equitable principles
relating to the granting of specific performance and other
equitable remedies as a matter of judicial discretion).

4. The due and proper performance of all corporate acts and
other proceedings required to be taken by Boatmen's Bank and
Boatmen's to authorize the execution, delivery and performance of
the Subsidiary Bank Merger Agreement, the due execution and
delivery of the Subsidiary Bank Merger Agreement by Boatmen's Bank
and Boatmen's, and the Subsidiary Bank Merger Agreement as a valid
and binding obligation of Boatmen's Bank and Boatmen's enforceable
against Boatmen's Bank and Boatmen's in accordance with its terms
(subject to the provisions of bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the
enforceability of creditors' rights generally from time to time in
effect, and equitable principles relating to the granting of
specific performance and other equitable remedies as a matter of
judicial discretion).

5. The due authorization and, when issued to the stockholders
of Company and Bank in accordance with the terms of the Agreement
and the Subsidiary Bank Merger Agreement, the valid issuance of the
shares of Boatmen's Common to be issued pursuant to the Merger and
the Subsidiary Bank Merger, such shares being fully paid and
nonassessable, with no personal liability attaching to the
ownership thereof.

6. The execution and delivery of the Agreement by Boatmen's
and the consummation of the transactions contemplated therein, as
neither conflicting with, in breach of or in default under,
resulting in the acceleration of, creating in any party the right
to accelerate, terminate, modify or cancel, or violate, any
provision of Boatmen's articles of incorporation or bylaws, or any
statute, regulation, rule, judgment, order or decree binding upon
Boatmen's which would be materially adverse to the business of
Boatmen's and its subsidiaries taken as a whole.

A-Ex. 1.09(b)-1
141

7. The execution and delivery of the Subsidiary Bank Merger
Agreement by Boatmen's Bank and Boatmen's, and the consummation of
the transactions contemplated therein, as neither conflicting with,
in breach of or in default under, resulting in the acceleration of,
creating in any party the right to accelerate, terminate, modify or
cancel, or violate, any provision of Boatmen's Bank's charter or
bylaws, or any statute, regulation, rule, judgment, order or decree
binding upon Boatmen's Bank which would be materially adverse to
the business of Boatmen's Bank.

8. The receipt of all required consents, approvals, orders
or authorizations of, or registrations, declarations or filings
with or without notices to, any court, administrative agency or
commission or other governmental authority or instrumentality,
domestic or foreign, or any other person or entity required to be
obtained or made by or with respect to Boatmen's, Boatmen's-
Illinois or Boatmen's Bank in connection with the execution and
delivery of the Agreement and/or the Subsidiary Bank Merger
Agreement, as the case may be, or the consummation of the
transactions contemplated by the Agreement and/or the Subsidiary
Bank Merger Agreement, as the case may be.

A-Ex. 1.09(b)-2
142

EXHIBIT 4.03
------------

SUBSIDIARY BANK MERGER AGREEMENT

This is a SUBSIDIARY BANK MERGER AGREEMENT (this "Agreement")
made September 1, 1994, by and between COMMUNITY STATE BANK, Salem,
Illinois, an Illinois state chartered bank ("Bank"), and BOATMEN'S
BANK OF SOUTH CENTRAL ILLINOIS, Mount Vernon, Illinois, an Illinois
state chartered bank ("Boatmen's Bank"), and joined in by BOATMEN'S
BANCSHARES, INC., a Missouri corporation ("Boatmen's").

a. Bank is a banking association duly organized under the
laws of the State of Illinois, with its principal office and place
of business at 401 West Main Street, Salem, Illinois, and having as
of June 30, 1994, capital stock of 37,500 common shares par value
$10.00 per share, all 37,500 of which are issued and outstanding
("Bank Stock"), surplus of $2,125,000 and undivided profits of
$3,651,000, in accordance with the balance sheet reflecting its
condition as of the close of business on June 30, 1994; and

b. Boatmen's Bank is a banking association duly organized
under the laws of the State of Illinois, with its principal office
at Main & 9th Streets, Mt. Vernon, Illinois, and having as of
June 30, 1994, capital stock of $2,700,000, consisting of 54,000
shares of common stock par value $50 per share, all 54,000 of which
are issued and outstanding ("Boatmen's Bank Stock"), surplus of
$4,000,000 and undivided profits of $5,599,348 (less $55,922 Market
Adjustment for Securities) in accordance with the balance sheet
reflecting its condition as of the close of business on June 30,
1994; and

c. Boatmen's is a Missouri corporation registered as a bank
holding company under the Bank Holding Company Act of 1956, as
amended (the "BHC Act"); and

d. Boatmen's-Illinois, Inc. is an Illinois corporation, and
a wholly-owned subsidiary of Boatmen's; and

e. Prior to the Effective Time (as defined herein),
Boatmen's-Illinois, Inc. will own one hundred percent (100%) of the
54,000 outstanding shares of Boatmen's Bank; and

f. Salem Community Bancorp, Inc. ("SCB") is an Illinois
corporation registered as a bank holding company under the Bank
Holding Company Act of 1956, as amended (the "BHC Act"), with its
principal office at the same address as that of Bank; and

g. SCB owns 36,139 (96.37%) of the 37,500 outstanding shares
of Bank and has control over Bank within the meaning of the BHC
Act, a list of the stockholders of Bank as of the date hereof being
attached as Exhibit A hereto.

In consideration of the premises and the mutual terms and
provisions set forth in this Agreement, the parties agree as
follows.

A-Ex. 4.03-1
143

SECTION 1.
---------

Bank shall merge with and into Boatmen's Bank (the "Bank
Merger"). Boatmen's Bank shall be the surviving entity of such
Bank Merger (the "Resulting Bank").

SECTION 2.
---------

The name of the Resulting Bank shall be "Boatmen's Bank of
South Central Illinois."

SECTION 3.
---------

At the effective time of the Bank Merger (the "Effective
Time"), the Articles of Incorporation of the Resulting Bank shall
read in its entirety as does the Articles of Incorporation of
Boatmen's Bank, and the Bylaws of Boatmen's Bank as in effect
immediately prior to the Effective Time shall be the bylaws of the
Resulting Bank.

SECTION 4.
---------

The business of the Resulting Bank shall be that of an
Illinois state chartered bank. This business shall be conducted by
the Resulting Bank at its main office which shall be located at the
existing main office location of Boatmen's Bank, and at its legally
established branches shall be the present main office and branch
locations of Bank and the present branch locations of Boatmen's
Bank.

SECTION 5.
---------

The number of directors which the Resulting Bank shall have
shall be seven (7), the terms which the directors shall serve shall
be as provided in Boatmen's Bank's bylaws or until their respective
successor is duly elected and qualified, and the directors who
shall serve as of the Effective Time of the Bank Merger shall be
those directors of Boatmen's Bank serving immediately prior to such
Effective Time and Robert W. Montgomery.

SECTION 6.
---------

At the Effective Time, the Resulting Bank shall be considered
the same business and corporate entity as each of the Bank and
Boatmen's Bank (collectively, the "Constituent Banks") and
thereupon and thereafter all the property, rights, privileges,
powers and franchises of each of the Constituent Banks shall vest
in the Resulting Bank and the Resulting Bank shall be subject to
and be deemed to have assumed all of the debts, liabilities,
obligations and duties of each of the Constituent Banks and shall
have succeeded to all of each of their relationships, fiduciary or
otherwise, as fully and to the same extent as if such property,
rights, privileges, powers, franchises, debts, liabilities,
obligations, duties and relationships had been originally acquired,
incurred or entered into by the Resulting Bank. In addition, any
reference to either of the Constituent Banks in any contract or
document, whether executed or taking effect before or

A-Ex. 4.03-2
144
after the Effective Time, shall be considered a reference to the Resulting
Bank if not inconsistent with the other provisions of the contract
or document; and any pending action or other judicial proceedings
to which either of the Constituent Banks is a party shall not be
deemed to have been abated and shall have the same force and effect
as if the Merger had not occurred; or the Resulting Bank may be
substituted as a party to such action or proceedings, and any
judgment, order or decree may be rendered for or against it that
might have been rendered for or against either of the Constituent
Banks as if the Merger had not occurred.

SECTION 7.
---------

(a) Each share of common stock, par value $50 per share, of
Boatmen's Bank issued and outstanding immediately prior to the
Effective Time shall remain issued and outstanding and shall be
unaffected by the Bank Merger.

(b) At the Effective Time, each share of common stock, par
value $10.00, of Bank (the "Bank Common") issued and outstanding
immediately prior to the Effective Time, other than shares the
holders of which have duly exercised and perfected their
dissenters' rights under applicable Illinois banking law, shall be
converted into the right to receive 9.39 shares of common stock,
par value $1.00 per share, of Boatmen's (the "Boatmen's Common")
(together with any cash payment in lieu of fractional shares, as
provided below, the "Bank Merger Consideration"). No fractional
shares of Boatmen's Common shall be issued and, in lieu thereof,
holders of shares of Bank Common who would otherwise be entitled to
a fractional share interest (after taking into account all shares
of Bank Common held by such holder) shall be paid an amount in cash
equal to the product of such fractional share interest and the
closing price of a share of Boatmen's Common on the Nasdaq Stock
Market's National Market ("Nasdaq") on the business day immediately
preceding the date on which the Effective Time occurs.

(c) At the Effective Time, all of the shares of Bank Common,
by virtue of the Bank Merger and without any action on the part of
the holders thereof, shall no longer be outstanding and shall be
canceled and retired and shall cease to exist, and each holder of
any certificate or certificates which immediately prior to the
Effective Time represented outstanding shares of Bank Common (the
"Certificates") shall thereafter cease to have any rights with
respect to such shares, except the right of such holders to
receive, without interest, the Bank Merger Consideration upon the
surrender of such Certificate or Certificates in accordance with
Section 11 hereof.

(d) If between the date hereof and the Effective Time a share
of Boatmen's Common shall be changed into a different number of
shares of Boatmen's Common or a different class of shares by reason
of reclassification, recapitalization, splitup, exchange of shares
or readjustment, or if a stock dividend thereon shall be declared
with a record date within such period, then the fraction of a share
of Boatmen's Common into which a share of Bank Common shall be
converted pursuant to subsection (b) above shall be appropriately
and proportionately adjusted so that each shareholder of Bank shall
be entitled to receive such number of shares of Boatmen's Common as
such shareholder would have received pursuant to such
reclassification, recapitalization, splitup, exchange of shares or
readjustment or as a result of such stock dividend had the record
date therefor been immediately following the Effective Time of the
Bank Merger.

(e) If holders of Bank Common are entitled to dissent from
this Subsidiary Bank Merger Agreement and Bank Merger under
applicable Illinois banking law, any issued and outstanding shares of

A-Ex. 4.03-3
145
Bank Common held by a dissenting holder shall not be converted
as described in subsection (b) above but from and after the
Effective Time shall represent only the right to receive such
consideration as may be determined to be due to such dissenting
holder pursuant to applicable Illinois banking law; provided,
however, that each share of Bank Common outstanding immediately
prior to the Effective Time and held by a dissenting holder who
shall, after the Effective Time, withdraw his demand for appraisal
or lose his right of appraisal shall have only such rights as are
provided under applicable Illinois banking law.

(f) Resulting Bank shall have capital stock of $2,700,000
consisting of 54,000 shares of capital stock issued and outstanding
with a par value of $50 per share, surplus of an amount equal to
the sum of the surplus of Bank and Boatmen's Bank and $375,000
transferred from the capital stock account of Bank and $2,125,000
transferred from the capital surplus account of the Bank, and
undivided profits equal to the sum of the undivided profits of Bank
and Boatmen's Bank. A pro forma statement of condition of
Resulting Bank as of June 30, 1994, giving effect to the Merger, is
attached to this Agreement as Exhibit B.

SECTION 8.
---------

In the event that certain Agreement as dated September 1,
1994, among Boatmen's, Boatmen's-Illinois and Salem Community
Bancorp, Inc. (the "Holding Company Merger Agreement") is
terminated pursuant to Article Seven thereof, this Agreement shall
also be terminated and the Bank Merger provided for herein shall
thereby be abandoned automatically without further act or deed by
the parties hereto and no party hereto shall have any further
liability, obligation or duty hereunder.

SECTION 9.
---------

Bank shall not pay any dividends after the date of this
Agreement except to the extent permissible pursuant to Section
4.01(a) of the Holding Company Merger Agreement.

SECTION 10.
----------

Consummation of this Agreement and the Bank Merger is subject
to the satisfaction of the conditions set forth in the
Reorganization Agreement, which include but are not limited to
(i) approval of the Illinois Commissioner of Banks and Trust
Companies (the "Illinois Commissioner"), and (ii) the affirmative
vote of the holders of at least two-thirds of the outstanding
shares of stock of each of Bank and Boatmen's Bank to constitute
approval of this Agreement. Regardless of whether this Agreement
is approved or disapproved by the Illinois Commissioner, Bank and
Boatmen's Bank shall pay all expenses incurred by the Illinois
Commissioner in his examination of the Merger.

SECTION 11.
----------

(a) Boatmen's Trust Company, St. Louis, Missouri, shall act
as Exchange Agent in the Bank Merger (the "Exchange Agent").

A-Ex. 4.03-4
146

(b) As soon as reasonably practicable after the Effective
Time, the Exchange Agent shall mail to each record holder of any
Certificate or Certificates whose shares were converted into the
right to receive the Bank Merger Consideration, a letter of
transmittal (which shall specify that delivery shall be effected,
and risk of loss and title to the Certificates shall pass, only
upon proper delivery of the Certificates to the Exchange Agent and
shall be in such form and have such other provisions as Boatmen's
may reasonably specify) (each such letter, the "Merger Letter of
Transmittal") and instructions for use in effecting the surrender
of the Certificates in exchange for the Bank Merger Consideration.
Upon surrender to the Exchange Agent of a Certificate, together
with a Merger Letter of Transmittal duly executed and any other
required documents, the holder of such Certificate shall be
entitled to receive in exchange therefor solely the Bank Merger
Consideration. No interest on the Bank Merger Consideration
issuable upon the surrender of the Certificates shall be paid or
accrued for the benefit of holders of Certificates. If the Bank
Merger Consideration is to be issued to a person other than a
person in whose name a surrendered Certificate is registered, it
shall be a condition of issuance that the surrendered Certificate
shall be properly endorsed or otherwise in proper form for transfer
and that the person requesting such issuance shall pay to the
Exchange Agent any required transfer or other taxes or establish to
the satisfaction of the Exchange Agent that such tax has been paid
or is not applicable.

(c) No dividends that are otherwise payable on shares of
Boatmen's Common constituting the Bank Merger Consideration shall
be paid to persons entitled to receive such shares of Boatmen's
Common until such persons surrender their Certificates. Upon such
surrender, there shall be paid to the person in whose name the
shares of Boatmen's Common shall be issued any dividends which
shall have become payable with respect to such shares of Boatmen's
Common (without interest and less the amount of taxes, if any,
which may have been imposed thereon), between the Effective Time
and the time of such surrender.

SECTION 12.
----------

This Agreement must be ratified and confirmed by the
affirmative vote of the shareholders of Bank and Boatmen's Bank
owning the requisite percentage of their respective capital stock
outstanding as required by law, at meetings to be held on the call
of the respective Boards of Directors.

A-Ex. 4.03-5
147

IN WITNESS WHEREOF, Bank and Boatmen's Bank have caused this
Subsidiary Bank Merger Agreement to be executed in multiple copies
by their duly authorized officers, and have caused their seals to
be hereunto affixed, as of the date first above written.

COMMUNITY STATE BANK

By----------------------------------------

BOATMEN'S BANK OF SOUTH CENTRAL ILLINOIS

By:---------------------------------------

ACKNOWLEDGED AND JOINED IN BY:

BOATMEN'S BANCSHARES, INC.

By:---------------------------------------
Leo G. Haas
Senior Vice President

A-Ex. 4.03-6
148

EXHIBIT 4.09
------------

-------------------, 199--

Boatmen's Bancshares, Inc.
One Boatmen's Plaza
800 Market Street
St. Louis, Missouri 63101

Re: Agreement and Plan of Merger, dated as of September 1,
1994 (the "Merger Agreement"), by and among Salem
Community Bancorp, Inc. ("Company"), Boatmen's
Bancshares, Inc. ("Boatmen's"), and Boatmen's-Illinois,
Inc. ("Boatmen's-Illinois")

Gentlemen:

I have been advised that I may be deemed to be an affiliate of
the Company, as that term is defined for purposes of paragraphs (c)
and (d) of Rule 145 ("Rule 145") of the Rules and Regulations of
the Securities and Exchange Commission (the "Commission")
promulgated under the Securities Act of 1933, as amended (the
"Securities Act").

Pursuant to the terms and conditions of the Merger Agreement,
each share of common stock of the Company owned by me as of the
effective time of the merger contemplated by the Merger Agreement
(the "Merger") may be converted into the right to receive shares of
common stock of Boatmen's and cash in lieu of any fractional share.
As used in this letter, the shares of common stock of the Company
owned by me as of ------------------------- (the date 30 days prior
to the anticipated effective time of the Merger) are referred to as
the "Pre-Merger Shares" and the shares of common stock of Boatmen's
which may be received by me in the Merger in exchange for my Pre-
Merger Shares are referred to as the "Post-Merger Shares." This
letter is delivered to Boatmen's pursuant to Section 4.08 of the
Merger Agreement.

A. I represent and warrant to Boatmen's and agree that:

1. I shall not make any sale, transfer or other
disposition of the Post-Merger Shares I receive pursuant to
the Merger in violation of the Securities Act or the Rules and
Regulations of the Commission promulgated thereunder.

2. I understand that the issuance of the Post-Merger
Shares to me pursuant to the Merger will be registered with
the Commission under the Securities Act. I also understand
that because I may be deemed an "affiliate" of Company and
because any distributions by me of the Post-Merger Shares will
not be registered under the Securities Act, such Post-Merger
Shares must be held by me unless (i) the sale, transfer or
other distribution has been registered under the Securities
Act, (ii) the sale, transfer or other distribution of such
Post-Merger Shares is made in accordance with the provisions
of Rule 145, or (iii) in the opinion of counsel acceptable to
Boatmen's some other exemption from registration under the
Securities Act is available with

A-Ex. 4.09-1
149

Boatmen's Bancshares, Inc.
- --------------------, 1994
Page 2

respect to any such proposed distribution, sale, transfer or other
disposition of such Post-Merger Shares.

3. In no event will I sell the Pre-Merger Shares or the
Post-Merger Shares, as the case may be, or otherwise transfer
or reduce my risk relative to the Pre-Merger Shares or Post-
Merger Shares, as the case may be, during the period beginning
30 days prior to the date on which the Merger is consummated
and ending on the date that Boatmen's has published financial
results covering at least 30 days of the combined operations
of Boatmen's and the Company.

B. I understand and agree that:

1. Stop transfer instructions will be issued with
respect to the Post-Merger Shares and there will be placed on
the certificates representing such Post-Merger Shares, or any
certificate delivered in substitution therefor, a legend
stating in substance:

"The shares represented by this Certificate were issued
in a transaction to which Rule 145 under the Securities
Act of 1933, as amended, applied. The shares represented
by this certificate may be transferred only in accordance
with the terms of a letter agreement dated
-----------------, 1994, by the registered holder in
favor of Boatmen's Bancshares, Inc., a copy of which
agreement is on file at the principal offices of
Boatmen's Bancshares, Inc."

2. Unless the transfer by me of Post-Merger Shares is
a sale made in compliance with the provisions of Rule 145(d)
or made pursuant to an effective registration statement under
the Securities Act, Boatmen's reserves the right to place the
following legend on the Certificates issued to my transferee:

"The shares represented by this Certificate have not been
registered under the Securities Act of 1933, as amended,
and were acquired from a person who received such shares
in a transaction to which Rule 145 under the Securities
Act of 1933, as amended, applied. The shares have not
been acquired by the holder with a view to, or for resale
in connection with, any distribution thereof within the
meaning of the Securities Act of 1933, as amended, and
may not be sold, pledged or otherwise transferred unless
the shares have been registered under the Securities Act
of 1933, as amended, or an exemption from registration is
available."

I understand and agree that the legends set forth in
paragraphs 1 and 2 above shall be removed by delivery of substitute
Certificates without any legend if I deliver to Boatmen's a copy of
a letter from the staff of the Commission, or an opinion of counsel
in form and substance satisfactory to Boatmen's, to the effect that
no such legend is required for the purpose of the Securities Act.

A-Ex. 4.09-2
150

Boatmen's Bancshares, Inc.
- --------------------, 1994
Page 3

I have carefully read this letter and the Merger Agreement and
understand the requirements of each and the limitations imposed
upon the distribution, sale, transfer or other disposition of Pre-
Merger Shares or Post-Merger Shares by me.

Very truly yours,

A-Ex. 4.09-3
151

EXHIBIT 7.09
------------

INDEX GROUP
-----------

NAME WEIGHTING FACTORS
- ---- -----------------

BancOne Corp. 15.29%
Bancorp Hawaii, Inc. 2.34%
CoreStates Financial Corp. 4.06%
First Bank System, Inc. 3.68%
First Fidelity Bancorporation 4.05%
Firstar Corporation 2.70%
Fleet/Norstar Financial Group, Inc. 6.07%
Huntington Bancshares Incorporated 2.11%
Meridian Bancorp, Inc. 1.93%
Comerica 3.88%
NBD Bancorp, Inc. 5.78%
Northern Trust Corporation 3.05%
Norwest Corporation 8.19%
PNC Financial Corp. 9.08%
Republic New York Corporation 3.62%
State Street Boston Corporation 4.02%
SunTrust Banks, Inc. 8.20%
U.S. Bancorp 3.56%
Wachovia Corporation 8.39%
------

TOTAL: 100.00%

A-Ex. 7.09-1
152

AMENDMENT TO AGREEMENT AND PLAN OF MERGER

This is an AMENDMENT (this "Amendment") made as of
September 28, 1994, by and among, BOATMEN'S BANCSHARES, INC., a
Missouri corporation, ("Boatmen's"), BOATMEN'S-ILLINOIS, INC., an
Illinois corporation, ("AcquisitionCo"), and SALEM COMMUNITY
BANCORP, INC., an Illinois corporation, ("Company"), to that
certain Agreement and Plan of Merger (the "Agreement") made
September 1, 1994, by and among Boatmen's, AcquisitionCo, and
Company.

In consideration of the premises and the mutual terms and
provisions set forth in this Amendment and the Agreement, the
parties hereby amend the Agreement as follows.

AMENDMENT
---------

SECTION 1. AMENDMENTS.
--------- ----------

(A) Section 4.09 of the Agreement is hereby amended by
deleting the third sentence thereof and inserting in lieu
thereof the following:

Section 4.09. Restriction on Resales.
------------ ----------------------
Company shall obtain and deliver to Boatmen's,
at least 31 days prior to the Closing Date,
the signed agreement, in the form of Exhibit
4.09 hereto, of each person who may reasonably
be deemed an "affiliate" of Company or Bank
within the meaning of such term as used in
Rule 145 under the Securities Act of 1933, as
amended (the "Securities Act"), regarding
compliance with the provisions of such Rule
145.

(B) Section 5.01 of the Agreement is hereby amended by
deleting the third sentence thereof and inserting in lieu
thereof the following:

Boatmen's shall file with the S.E.C. the
Registration Statement relating to the shares
of Boatmen's Common to be issued to the
stockholders of Company pursuant to this
Agreement, and shall use its best efforts to
cause the Registration Statement to become
effective.

(C) Section 5.01 of the Agreement is hereby further amended
by deleting the last sentence thereof and inserting in
lieu thereof the following:

Boatmen's shall promptly and properly prepare
and file (i) any application required to list
on Nasdaq the shares of Boatmen's Common to be
issued pursuant to the Merger, and (ii) any
filings required under the Securities Exchange
Act of 1934 (the "Exchange Act") relating to
the Merger and the transactions contemplated
herein.

(D) Section 6.01(f) of the Agreement is hereby deleted in its
entirety and the following inserted in lieu thereof:

(f) Reserved.

A-Amend(1)-1
153

(E) Section 6.01(h) of the Agreement is hereby deleted in its
entirety and the following inserted in lieu thereof:

(h) Boatmen's shall have received an opinion
of its counsel to the effect that if the
Merger is consummated in accordance with the
terms set forth in this Agreement, (i) the
Merger and Subsidiary Bank Merger will
constitute a reorganization within the meaning
of Section 368(a) of the Code; (ii) no gain or
loss will be recognized by the holders of
shares of Company Common upon receipt of
Merger Consideration (except for cash received
in lieu of fractional shares); (iii) the basis
of shares of Boatmen's Common received by the
stockholders of Company will be the same as
the basis of shares of Company Common
exchanged therefor; and (iv) the holding
period of the shares of Boatmen's Common
received by such stockholders will include the
holding period of the shares of Company Common
exchanged therefor, provided such shares were
held as capital assets as of the Effective
Time; and

(F) The second paragraph of Section 8.04(b) of the Agreement
is hereby deleted in its entirety and the following
inserted in lieu thereof:

with copies to:

Suelthaus & Kaplan
7733 Forsyth Blvd., 12th Floor
Clayton, Missouri 63105
Attention: Mr. Kenneth H. Suelthaus

(G) Section 5. of Exhibit 1.09 (b) of the Agreement is hereby
deleted in its entirety and the following inserted in
lieu thereof:

5. The due authorization and, when issued to
the stockholders of Company in accordance with
the terms of the Agreement, the valid issuance
of the shares of Boatmen's Common to be issued
pursuant to the Merger, such shares being
fully paid and nonassessable, with no personal
liability attaching to the ownership thereof.

(H) Exhibit 4.03 of the Agreement, The Subsidiary Bank Merger
Agreement, and all references thereto in the Agreement,
are amended to refer to the Subsidiary Bank Merger
Agreement dated as of September 1, 1994, as amended by
that certain Amendment to the Subsidiary Bank Merger
Agreement, of even date herewith.

(I) Exhibit 4.09 of the Agreement is hereby deleted in its
entirety and the Exhibit 4.09 attached hereto a made a
part hereof, is inserted in lieu thereof.

SECTION 2. CONTINUED FORCE AND EFFECT. Except as expressly
--------- --------------------------
amended or modified hereby, each of the terms, provisions,
covenants, representations and warranties contained in the
Agreement shall remain in full force and effect.

A-Amend(1)-2
154

SECTION 3. MULTIPLE COUNTERPARTS. This Amendment may be
--------- ---------------------
executed in multiple counterparts, each of which shall constitute
an original and all of which taken together shall constitute but
one and the same document.

IN WITNESS WHEREOF, the parties hereto have duly executed this
Amendment as of the day and year first above written.

BOATMEN'S BANCSHARES, INC.

By:/s/ Leo G. Haas
---------------------------------------
Leo G. Haas, Senior Vice President

SALEM COMMUNITY BANCORP, INC.

By:/s/ Robert W. Montgomery
---------------------------------------
Robert W. Montgomery, President and
Chief Executive Officer

BOATMEN'S-ILLINOIS, INC.

By:/s/ Leo G. Haas
---------------------------------------
Leo G. Haas, Vice President

A-Amend(1)-3
155

EXHIBIT 4.09
------------
(As Amended)

-------------------, 199--

Boatmen's Bancshares, Inc.
One Boatmen's Plaza
800 Market Street
St. Louis, Missouri 63101

Gentlemen:

A. I represent and warrant to Boatmen's and agree that:

1. I shall not make any sale, transfer or other
disposition of the Boatmen's Shares I receive pursuant to the
Merger in violation of the Securities Act or the Rules and
Regulations of the Commission promulgated thereunder.

2. I understand that the issuance of the Boatmen's
Shares to me pursuant to the Merger will be registered with
the Commission under the Securities Act. I also understand
that because I may be deemed an "affiliate" of Company and
because any distributions by me of the Boatmen's Shares will
not be registered under the Securities Act, such Boatmen's
Shares must be held by me unless (i) the sale, transfer or
other distribution has been registered under the Securities
Act, (ii) the sale, transfer or other distribution of such
Boatmen's Shares is made in accordance with the provisions of
Rule 145, or (iii) in the opinion of counsel acceptable to
Boatmen's some other exemption from registration under the
Securities Act is available with respect to any such proposed
distribution, sale, transfer or other disposition of such
Boatmen's Shares.

A-Amend(1)-Ex. 4.09-1
156

B. I understand and agree that:

1. Stop transfer instructions will be issued with
respect to the Boatmen's Shares and there will be placed on
the certificates representing such Boatmen's Shares, or any
certificate delivered in substitution therefor, a legend
stating in substance:

2. Unless the transfer by me of Boatmen's Shares is a
sale made in compliance with the provisions of Rule 145(d) or
made pursuant to an effective registration statement under the
Securities Act, Boatmen's reserves the right to place the
following legend on the Certificates issued to my transferee:

Very truly yours,

A-Amend(1)-Ex. 4.09-2
157

SECOND AMENDMENT TO AGREEMENT AND PLAN OF MERGER

This is an AMENDMENT (this "Amendment") made as of December 2,
1994, by and among, BOATMEN'S BANCSHARES, INC., a Missouri cor-
poration, ("Boatmen's"), BOATMEN'S-ILLINOIS, INC., a Missouri
corporation, ("AcquisitionCo"), and SALEM COMMUNITY BANCORP, INC.,
an Illinois corporation, ("Company"), to that certain Agreement and
Plan of Merger made September 1, 1994, by and among Boatmen's,
AcquisitionCo, and Company and amended by the First Amendment to
Agreement and Plan of Merger dated as of October 28, 1994, (as so
amended, the "Agreement").

RECITALS
--------

WHEREAS, Boatmen's-Illinois, Inc., formerly an Illinois
corporation, was reincorporated through the merger of such Illinois
corporation into a Missouri corporation, also named Boatmen's-
Illinois, Inc.

NOW THEREFORE, in consideration of the premises and the mutual
terms and provisions set forth in this Amendment and the Agreement,
the parties hereby amend the Agreement as follows.

AMENDMENT
---------

SECTION 1. AMENDMENTS.
--------- ----------

(A) All references in the Agreement to Boatmen's-Illinois,
Inc., as an Illinois corporation are amended to refer to
Boatmen's-Illinois, Inc., as a Missouri corporation.

(B) Section 1.01 of the Agreement is hereby deleted in its
entirety and the following inserted in lieu thereof:

SECTION 1.01. THE MERGER. Pursuant to the
------------ ----------
terms and provisions of this Agreement and the
General and Business Corporation Law of
Missouri (the "Corporate Law"), Company shall
merge with and into AcquisitionCo (the
"Merger").

(C) Section 1.08 of the Agreement is hereby amended by
deleting the last sentence thereof and inserting in lieu
thereof the following:

The merger shall be effective upon the filing
of Articles of Merger with the Secretary of
State of the State of Missouri (the "Effective
Time"), which the parties shall use their best
efforts to cause to occur on the Closing Date.

(D) Section 3.01(a) of the Agreement is hereby amended by
deleting the last sentence thereof and inserting in lieu
thereof the following:

AcquisitionCo is a corporation duly
incorporated, validly existing, and in good
standing under the laws of the State of
Missouri with full

A-Amend(2)-1
158

corporate power and authority to carry on its business
as it is now being conducted.

(E) Section 3.01(c) of the Agreement is hereby amended by
deleting the first sentence thereof and inserting in lieu
thereof the following:

AcquisitionCo is incorporated under the laws
of the State of Missouri.

(F) Paragraph 1 of Exhibit 1.09 (b) to the Agreement is
hereby deleted in its entirety and the following inserted
in lieu thereof:

The due incorporation, valid existence and
good standing of Boatmen's and Boatmen's-
Illinois under the laws of the State of
Missouri, and their respective power and
authority to enter into the Agreement and to
consummate the transactions contemplated
thereby.

IN WITNESS WHEREOF, the parties hereto have duly executed this
Amendment as of the day and year first above written.

BOATMEN'S BANCSHARES, INC.

By:/s/ Leo G. Haas
---------------------------------------
Leo G. Haas, Senior Vice President

SALEM COMMUNITY BANCORP, INC.

By:/s/ Robert W. Montgomery
---------------------------------------
Robert W. Montgomery, President and
Chief Executive Officer

BOATMEN'S-ILLINOIS, INC.

By:/s/ Leo G. Haas
---------------------------------------
Leo G. Haas, Vice President

A-Amend(2)-2
159

APPENDIX B

EXCERPTS OF THE ILLINOIS BUSINESS CORPORATION ACT
(DISSENTERS' RIGHTS)

11.65 RIGHT TO DISSENT.--(a) A shareholder of a corporation
is entitled to dissent from, and obtain payment for his or her
shares in the event of any of the following corporate actions:

(1) consummation of a plan of merger or consolidation or a
plan of share exchange to which the corporation is a party if
(i) shareholder authorization is required for the merger or
consolidation or the share exchange by Section 11.20 or the
articles of incorporation or (ii) the corporation is a subsidiary
that is merged with its parent or another subsidiary under
Section 11.30;

(2) consummation of a sale, lease or exchange of all, or
substantially all, of the property and assets of the corporation
other than in the usual and regular course of business;

(3) an amendment of the articles of incorporation that
materially and adversely affects rights in respect of a dissenter's
shares because it:

(i) alters or abolishes a preferential right of such shares;

(ii) alters or abolishes a right in respect of redemption,
including a provision respecting a sinking fund for the redemption
or repurchase, of such shares;

(iii) in the case of a corporation incorporated prior to
January 1, 1982, limits or eliminates cumulative voting rights with
respect to such shares; or

(4) any other corporate action taken pursuant to a
shareholder vote if the articles of incorporation, by-laws, or a
resolution of the board of directors provide that shareholders are
entitled to dissent and obtain payment for their shares in
accordance with the procedures set forth in Section 11.70 or as may
be otherwise provided in the articles, by-laws or resolution.

(b) A shareholder entitled to dissent and obtain payment for
his or her shares under this Section may not challenge the
corporate action creating his or her entitlement unless the action
is fraudulent with respect to the shareholder or the corporation or
constitutes a breach of a fiduciary duty owed to the shareholder.

(c) A record owner of shares may assert dissenters' rights as
to fewer than all the shares recorded in such person's name only if
such person dissents with respect to all shares beneficially owned
by any one person and notifies the corporation in writing of the
name and address of each person on whose behalf the record owner
asserts dissenters' rights. The rights of a partial dissenter are
determined as if the shares as to which dissent is made and the
other shares recorded in the names of different shareholders. A
beneficial owner of shares who is not the record owner may assert
dissenters' rights as to shares held on such person's behalf only
if the beneficial owner submits to the corporation the record
owner's written consent to the dissent before or at the same time
the beneficial owner asserts dissenters' rights.

B-1
160

11.70 PROCEDURE TO DISSENT.--(a) If the corporate action
giving rise to the right to dissent is to be approved at a meeting
of shareholders, the notice of meeting shall inform the
shareholders of their right to dissent and the procedure to
dissent. If, prior to the meeting, the corporation furnishes to
the shareholders such material information with respect to the
transaction as will objectively enable a shareholder to vote on the
transaction and to determine whether or not to exercise dissenters'
rights, a shareholder may assert dissenters' rights only if the
shareholder delivers to the corporation before the vote is taken a
written demand for payment for his or her shares if the proposed
action is consummated, and the shareholder does not vote in favor
of the proposed action.

(b) If the corporation action giving rise to the right to
dissent is not to be approved at a meeting of shareholders, the
notice to shareholders describing the action taken under
Section 11.30 or Section 7.10 shall inform the shareholders of
their right to dissent and the procedure to dissent. If, prior to
or concurrently with such notice, the corporation furnishes to the
shareholders such material information with respect to the
transaction as will objectively enable a shareholder to determine
whether or not to exercise dissenters' rights, a shareholder may
assert dissenter's rights only if he or she delivers to the
corporation within thirty days from the date of mailing said notice
a written demand for payment for his or her shares.

(c) Within ten days after the date on which the corporate
action giving rise to the right to dissent is effective or thirty
days after the shareholder delivers to the corporation the written
demand for payment, whichever is later, the corporation shall send
each shareholder who has delivered a written demand for payment a
statement setting forth the opinion of the corporation as to the
estimated value of the shares, the corporation's latest balance
sheet as of the end of a fiscal year ending not earlier than
sixteen months before the delivery of the statement, together with
the statement of income for that year and the latest available
interim financial statements, and either a commitment to pay for
the shares of the dissenting shareholder at the estimated value
thereof upon transmittal to the corporation of the certificate or
certificates, or other evidence of ownership, with respect to such
shares, or instructions to the dissenting shareholder to sell his
or her shares within ten days after delivery of the corporation's
statement to the shareholder. The corporation may instruct the
shareholder to sell only if there is a public market for the shares
at which the shares may be readily sold. If the shareholder does
not sell within such ten day period after being so instructed by
the corporation, for purposes of this Section the shareholder shall
be deemed to have sold his or her shares at the average closing
price of such shares, if listed on a national exchange, or the
average of the bid and asked price with respect to such shares
quoted by a principal market maker, if not listed on a national
exchange, during such ten day period.

(d) If the shareholder does not agree with the opinion of the
corporation as to the estimated value of the shares, the
shareholder, within thirty days from the delivery of the
corporation's statement of value, shall notify the corporation in
writing of the shareholder's estimate of value and demand payment
for the difference between the shareholder's estimate of value and
the amount of the payment by the corporation or the proceeds of
sale by the shareholder, whichever is applicable because of the
procedure for which the corporation opted pursuant to
subsection (c).

(e) If, within 60 days from delivery to the corporation of
the shareholder notification of estimate of value of the shares,
the corporation and the dissenting shareholder have not agreed in
writing upon the value of the shares, the corporation shall either
pay the difference in value demanded by the shareholder or file a
petition in the circuit court of the county in which either the
registered office or the principal office of the corporation is
located, requesting the court to determine the fair value of the
shares. The corporation shall make all dissenters, whether or not
residents of this State, whose demands remain unsettled parties to
the proceeding as an action against their shares and all parties
should be served

B-2
161
with a copy of the petition. Nonresidents may be served by registered or
certified mail or by publication as provided by law. Failure of the
corporation to commence an action pursuant to this Section shall not limit
or affect the right of the dissenting shareholders to otherwise commence an
action as permitted by law.

(f) The jurisdiction of the court in which the proceeding is
commenced under subsection (e) by a corporation is plenary and
exclusive. The court may appoint one or more persons as appraisers
to receive evidence and recommend decision on the question of fair
value. The appraisers have the power described in the order
appointing them, or in any amendment to it.

(g) Each dissenter made a party to the proceeding is entitled
to judgment for the amount, if any, by which the court finds that
the fair value of his or her share exceeds the amount paid by the
corporation or the proceeds of sale by the shareholder, whichever
amount is applicable. The judgment shall include an allowance for
interest at such rate as the court may find to be fair and
equitable in all the circumstances, from the date on which the
corporate action giving rise to the right to dissent is approved to
the date of payment.

(h) The court, in an appraisal proceeding commenced under
subsection (e), shall determine all costs of the proceeding,
including the reasonable compensation and expenses of the
appraisers, if any, and experts employed by any party, but shall
exclude the fees and expenses of counsel for any party. If the
fair value of the shares as determined by the court materially
exceeds the amount which the corporation offered to pay for those
shares, or if no offer was made, then all or any part of such
expenses may be assessed against the corporation. Except as
otherwise provided in this Section, the practice, procedure,
judgment and costs shall be governed by the Code of Civil
Procedure.

B-3