BARRETT R. ROCHMAN
P.O. BOX 3074
CARBONDALE, ILLINOIS 62902
(618) 457-4334 OR (800) 529-3513
March 6, 1998
Dear Fellow Shareholder:
Now that almost a year has passed since Heartland's first Annual Meeting
of Shareholders, I wanted to write to you and give you my thoughts on the
progress of our company in 1997.
I believe that Heartland Bancshares' recent financial performance has
been very disappointing. Based upon the financial information contained in
Heartland's most recent quarterly report filed with the Securities and
Exchange Commission, Heartland had a return on total assets of less than 0.3%
and had a return on shareholders' equity of less than 4.50%, on an annualized
and undiluted basis for the first nine months in 1997. I feel these results
are unacceptable, and I have been unhappy with Heartland's performance since
it became a public company in June, 1996. I believe that a bank should earn a
return on total assets of at least 1% annually. On January 20, 1998, the
Chicago Sun Times reported that, as of September 30, 1997, the national
average return on assets for banks in the United States was 1.24%. Further,
the Office of the Comptroller of the Currency ("OCC"), the agency that
regulates national banks such as Heartland National Bank, reported that the
return on assets for FDIC-insured national banks for the second quarter of
1997 was 1.32%. Additionally, I believe that Heartland should be providing
shareholders with a return on total equity of between 10% and 15% per year.
The OCC also reported that the return on equity for FDIC-insured national
banks for the second quarter of 1997 was 15.27%. While I understand that
Heartland may need some time to achieve these benchmarks, the bank is
nevertheless significantly below these thresholds.
As you may know, I am the largest shareholder of Heartland outside of the
Employee Stock Ownership Plan and am very much interested in the business of
Heartland and Heartland National Bank, since the value of my investment, as
well as yours, is directly affected by the success of Heartland and Heartland
National Bank. I intend to continue to monitor Heartland's performance and to
report my findings to you from time to time. Everything I am doing is in an
effort to further the best interests of all Heartland shareholders. For this
reason, I intend to nominate myself for election as a director at the 1998
Annual Meeting of Shareholders. I will be sending you additional materials
relating to this in the near future.
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Heartland Shareholders
March 6, 1998
Page 2
With your support and involvement, we can make a difference at Heartland.
If you have any questions or would like to discuss my concerns further, please
do not hesitate to call me at (618) 457-4334 or (800) 529-3513.
Sincerely,
/s/ Barrett R. Rochman
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Barrett R. Rochman
