RIGGS NATIONAL CORP, S-3, 1999-06-16

RIGGS NATIONAL CORP
S-3, 1999-06-16
NATIONAL COMMERCIAL BANKS

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<PAGE>

As filed with the Securities and Exchange Commission on June 16, 1999
Registration No. 333-[ ]
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
RIGGS NATIONAL CORPORATION RIGGS CAPITAL III
(Exact name of registrant as specified (Exact name of registrant as
in its charter) specified in its charter)
Delaware
(State or other jurisdiction of
Delaware incorporation or organization)
(State or other jurisdiction of [To Be Applied For]
incorporation or organization) (I.R.S. Employer Identification No.)
52-1217953 c/o RIGGS NATIONAL CORPORATION
(I.R.S. Employer Identification No.) 1503 Pennsylvania Avenue, N.W.

Washington, D.C. 20005
1503 Pennsylvania Avenue, N.W. (202) 835-4309
Washington, D.C. 20005 (Address, including zip code, and
(202) 835-4309 telephone number,
(Address, including zip code, and including area code, of registrant's
telephone number, principal executive offices)
including area code, of registrant's
principal executive offices)
---------------
Joseph M. Cahill, Esq.
Riggs National Corporation
1503 Pennsylvania Avenue, N.W.
Washington, D.C. 20005
(202) 835-4309
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies to:
Robert H. Craft, Jr. Gary Rice
Sullivan & Cromwell Simpson Thacher & Bartlett
1701 Pennsylvania Avenue, N.W. 425 Lexington Avenue
Washington, DC 20006 New York, NY 10017-3909
(202) 956-7500 (212) 455-2000
---------------
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [_]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [_]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the
same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]

CALCULATION OF REGISTRATION FEE
<TABLE>
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<CAPTION>
Proposed Proposed maximum
Title of each class of Amount to be maximum offering aggregate Amount of
securities to be Registered registered(1) price per unit(1) offering price(1) registration fee
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<S> <C> <C> <C> <C>
Series D Trust Preferred
Securities of Riggs
Capital III........... $200,000,000 $1,000 $200,000,000 $55,600
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Junior Subordinated
Deferrable Interest
Debentures of Riggs
National
Corporation(2)(3)..... $200,000,000 $1,000 N/A N/A
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Riggs National
Corporation Guarantee
with respect to Series
D Trust Preferred
Securities(3)......... N/A N/A N/A N/A
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Total.................. $200,000,000 100% $200,000,000(4) $55,600
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</TABLE>
(1) Estimated solely for the purpose of computing the registration fee pursuant
to Rule 457.
(2) The Junior Subordinated Deferrable Interest Debentures will be purchased by
Riggs Capital III with the proceeds of the sale of the Series D Trust
Preferred Securities.
(3) This Registration Statement is deemed to cover the Junior Subordinated
Deferrable Interest Debentures of Riggs National Corporation, the rights of
holders of Junior Subordinated Deferrable Interest Debentures of Riggs
National Corporation under the Indenture, the rights of holders of Series D
Trust Preferred Securities of Riggs Capital III under the Trust Agreement
and the rights of holders of the Series D Trust Preferred Securities under
the Guarantee of Riggs National Corporation, which taken together, fully,
irrevocably and unconditionally guarantee all of the obligations of Riggs
Capital III under the Series D Trust Preferred Securities. No separate
consideration will be received for the Riggs National Corporation
Guarantee. Pursuant to Rule 457 no separate fee is payable with respect to
the Guarantee and the Junior Subordinated Deferrable Interest Debentures.
(4) Such amount represents the principal amount of Junior Subordinated
Deferrable Interest Debentures issued at their principal amount and the
issue price rather than the principal amount of Junior Subordinated
Deferrable Interest Debentures issued at an original issue discount. Such
amount also represents the initial public offering price of the Riggs
Capital III Series D Trust Preferred Securities.
The Registrants hereby amend this registration statement on such date or dates
as may be necessary to delay its effective date until the registrants shall
file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this registration statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
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<PAGE>

SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED JUNE 16, 1999

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++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. A final prospectus will be +
+delivered to the purchasers of these securities. This prospectus is not an +
+offer to sell these securities and it is not soliciting an offer to buy these +
+securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
$200,000,000

[LOGO]

Riggs Capital III

Floating Rate Trust Preferred Securities, Series D
Fully and Unconditionally Guaranteed by

Riggs National Corporation

We--

. are Riggs National Corporation, a bank holding company headquartered in
Washington, D.C. We are engaged in a variety of banking and financial
services activities, including community banking, relationship banking,
international banking, and trust and investment management services.

. will fully, irrevocably and unconditionally guarantee the capital securities
as described in this prospectus.

The Trust--

. is a Delaware trust, Riggs Capital III, created as our subsidiary for the
sole purpose of issuing the capital securities and will hold our junior
debentures as its only asset.

The Trust Preferred Securities--

. pay quarterly distributions at the annual rate of LIBOR plus . % of the
liquidation preference, which may be deferred by us for up to 20 consecutive
quarterly periods.

. may be redeemed by us at any time after . , 2004 for any reason and at other
times for the reasons described in this prospectus.

These securities are not deposits or other obligations of a bank and are not
insured or guaranteed by the federal deposit insurance corporation or any other
governmental agency.

Consider carefully the risk factors beginning on page 7 of this prospectus.

Neither the securities and exchange commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is
a criminal offense.
<TABLE>
<CAPTION>
Per Trust
Preferred
Security Total
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<S> <C> <C>
Public Offering Price $ $
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Underwriting Commissions (1) (1)
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Proceeds to Riggs Capital III $ $
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</TABLE>
(1) We will pay underwriting commissions of $ . per floating rate trust
preferred security (or $ . for all floating rate trust preferred
securities).

If you purchase the trust preferred securities and settlement occurs after July
. , 1999, you will be required to pay accumulated distributions on the trust
preferred securities, if any, from that date to the date of your purchase.

The underwriters expect to deliver the trust preferred securities against
payment in book-entry form only in New York, New York on July . , 1999.

Warburg Dillon Read LLC
<PAGE>

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TABLE OF CONTENTS
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<TABLE>
<CAPTION>
Page
<S> <C>
Forward-Looking Statements........... 2
Summary Information -- Q&A........... 3
Risk Factors......................... 7
Riggs National Corporation........... 11
Riggs Capital III.................... 13
Use of Proceeds...................... 14
Capitalization....................... 15
Selected Consolidated Financial
Data................................ 16
Management's Discussion and Analysis
of Financial Condition and Results
of Operations....................... 18
Supervision and Regulation........... 25
Accounting Treatment................. 27
Description of Trust Preferred
Securities.......................... 28
Description of Junior Debentures..... 39
</TABLE>
<TABLE>
<CAPTION>
Page
<S> <C>
Description of the Guarantee and the
Expense Agreement.................. 46
Relationship among the Trust
Preferred Securities, the Junior
Debentures, the Guarantee and the
Expense Agreement.................. 48
Book-Entry Issuance................. 50
U.S. Federal Income Tax
Considerations..................... 53
ERISA Considerations................ 56
Underwriting........................ 58
Validity of Securities.............. 60
Experts............................. 60
Where You Can Find More
Information........................ 60
Incorporation of Information We File
With the SEC....................... 61
</TABLE>

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1
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Forward-Looking Statements

This prospectus and the information incorporated by reference in this
prospectus contain statements that plan for or anticipate the future. Forward-
looking statements include statements about the future financial performance,
business plans and strategies of Riggs National Corporation and the trust and
most other statements that are not historical in nature. Because forward-
looking statements involve future risks and uncertainties, there are factors
that could cause actual results to differ materially from those expressed or
implied. Besides the specified risk factors identified beginning on page 7,
some of the uncertainties that could effect the accuracy of forward-looking
statements include:

. sharp or rapid changes in interest rates;

. significant changes in the economy that could materially change anticipated
credit quality trends and the ability to generate loans;

. failure of the capital markets to function consistently with customary
levels;

. significant delays in or inability to execute strategic initiatives designed
to increase revenues or manage expenses;

. consummation of significant business combinations or divestitures;

. unforeseen business risks related to Year 2000 computer systems issues; and

. significant changes in accounting, tax or regulatory practices or
requirements.

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2
<PAGE>

Summary Information -- Q&A
This summary includes questions and answers that highlight selected information
from this prospectus to help you understand the trust preferred securities.
However, this summary does not contain all the information that may be
important to you. You should read the entire prospectus carefully, including
our financial data and related notes, which are incorporated by reference,
before making an investment decision. You should pay special attention to the
"Risk Factors" section, beginning on page 7, to determine whether an investment
in the trust preferred securities is appropriate for you.

What Are the Trust Preferred Securities?
The trust will issue and sell $200,000,000 trust preferred securities
representing preferred undivided beneficial ownership interests in the assets
of the trust. Each trust preferred security will entitle you to receive your
proportionate share of interest payments made on the junior debentures.

What Are the Junior Debentures?
We will issue and sell to the trust $206,186,000 aggregate principal amount of
our floating rate junior subordinated deferrable interest debentures due July
., 2029 that will rank junior in priority of payment to substantially all of
our other obligations. The junior debentures are not secured by any of our
property or assets. If we make all of the payments we are required to make to
the trust under the junior debentures, the aggregate quarterly interest
payments on the junior debentures will be sufficient for the trust to make the
aggregate distribution payments on the trust preferred securities to you.

The junior debentures will mature on July ., 2029, at which date the trust must
redeem the trust preferred securities at a price equal to $1,000 per trust
preferred security plus all accrued and unpaid distributions.

When Will You Receive Distributions?
If you purchase the trust preferred securities, you are entitled to receive
cumulative cash distributions at an annual rate of LIBOR plus .% of the
liquidation preference of $1,000 per trust preferred security. Distributions
will accumulate from the date the trust issues the trust preferred securities
and will be paid quarterly in arrears on ., ., . and . of each year, beginning
., 1999. If the trust is liquidated, you will receive a liquidation preference
of $1,000 for each trust preferred security.

The interest payments paid on the junior debentures will be the trust's only
sources of funds to pay distributions on the trust preferred securities to you.

Except in cases of default, distributions will be made simultaneously and
proportionately on the trust preferred securities and common securities. In
cases of default, holders of trust preferred securities will have priority in
right of payment over holders of common securities.

Who Is the Trust?
The trust, Riggs Capital III, our subsidiary, is a Delaware statutory business
trust created solely for the purpose of issuing trust preferred securities to
you and common securities to us and investing the proceeds in an equivalent
amount of our junior debentures. The junior debentures will be the sole assets
of the trust. The trust has its principal office and mailing address at c/o
Riggs National Corporation, 1503 Pennsylvania Avenue, N.W., Washington, D.C.
20005. Its telephone number is (202) 835-4309.

The trust will initially have four trustees, two of whom are our employees and
who were appointed by us. In addition, The Bank of New York will act as a
property trustee and The Bank of New York (Delaware), an affiliate of the
property trustee, will act as a Delaware trustee. The property trustee will
hold the junior debentures and the guarantee for your benefit.

Who Is Riggs National Corporation?
We are a bank holding company headquartered in Washington, D.C. We are engaged
in a variety of banking and financial services activities, including community
banking and relationship banking, international banking and trust and
investment management services. Our principal subsidiary is Riggs Bank N.A., a
national banking association founded in 1836. We currently have banking
operations or separate subsidiaries in the Washington, D.C. metropolitan area;
New Haven, Connecticut; Miami, Florida; London, England; and Nassau, Bahamas.
Our principal office and mailing address is at 1503 Pennsylvania Avenue, N.W.,
Washington, D.C. 20005. Our telephone number is (202) 835-4309.

How Will the Trust Pay for Distributions on the Trust Preferred Securities?
The trust will pay distributions out of any interest payments it receives from
us on the junior debentures. We expect to pay interest on the junior debentures
quarterly at an annual rate of LIBOR plus .% of the $1,000 liquidation
preference.

Will Holders of the Trust Preferred Securities Have Any Voting Rights?
Generally, the holders of trust preferred securities will not have any voting
rights. See "Description of the Trust Preferred Securities -- Voting Rights."

3
<PAGE>

When Can Payment of Your Distribution Be Deferred?
We may defer interest payments on the junior debentures for up to 20
consecutive quarterly periods. If we defer interest payments, the trust also
will defer the payment of distributions on the trust preferred securities to
you. During any deferral period, distributions will continue to accumulate on
the trust preferred securities and additional distributions will accumulate on
these deferred distributions at .%. During any deferral period, you will be
required to accrue interest income and include it in your gross income for U.S.
federal income tax purposes, even if you are a cash basis taxpayer.

What Is the Guarantee?
We will provide an irrevocable and unconditional guarantee, on a subordinated
basis, of the payments on the trust preferred securities, but only to the
extent that the trust has funds available on hand to make those payments. Our
obligations under the guarantee agreement will rank junior in right of payment
to all of our senior debt.

When Can the Trust Redeem the Trust Preferred Securities?
The trust must redeem the trust preferred securities and common securities:

(1) when we repay the principal on the junior debentures at their maturity;

(2) if we elect to redeem the junior debentures at any time upon the
occurrence of (a) changes in U.S. federal income tax laws or regulations
that could have adverse tax consequences for us or the trust or (b)
changes in law or regulations that could prevent us from treating an
amount equal to the liquidation amount of the trust preferred securities
as Tier 1 capital for purposes of the applicable Federal Reserve capital
adequacy guidelines; and

(3) if we elect to redeem all or any part of the junior debentures at any
time after July ., 2004.

If we redeem the junior debentures, the trust will be required to redeem an
equivalent amount of trust preferred securities. The trust preferred securities
will be redeemed at 100% of their liquidation preference, plus accrued and
unpaid distributions.

What Happens If the Trust Is Dissolved?
We may dissolve the trust at any time with the prior approval of the Federal
Reserve, if it is required at the time. If we dissolve the trust, the trust
will distribute the junior debentures to you in exchange for the trust
preferred securities. If the exchange is not practical, the trust will
distribute $1,000 per trust preferred security, plus all accumulated and unpaid
distributions. In all cases, however, distributions will be made only to the
extent of the trust's assets that are available after satisfaction of all
liabilities to creditors.

Are the Trust Preferred Securities Rated?
The trust preferred securities have been rated "baa3" by Moody's Investors
Service, Inc. and "BB" by Standard & Poor's Rating Services, a division of the
McGraw-Hill Company, Inc.

What Are the Risks Associated With Your Investment?
Please read the "Risk Factors" section beginning on page 7 of this prospectus.

What Will You Receive to Represent Your Ownership of the Trust Preferred
Securities?
You will not receive a certificate to represent your ownership of the trust
preferred securities. Instead, the trust preferred securities will be
represented by global certificates registered in the name of Cede & Co., as
nominee for The Depository Trust Company, or DTC. Payments on the trust
preferred securities will be made to DTC, which will credit the relevant
accounts at DTC, and your financial institution will be responsible for passing
those payments along to you.

What Are the Common Securities?
The common securities represent undivided beneficial ownership interests in the
assets of the trust. We will hold all the common securities.

How Will We Use the Proceeds?
The trust will use the proceeds from this offering and the sale of trust common
securities to purchase the junior debentures issued by us. We expect to use the
net proceeds from the sale of the junior debentures for general corporate
purposes, which may include, but not be limited to, (1) the repurchase or
redemption of up to $125,000,000 of our 8.50% subordinated notes due 2006 and
(2) investment of up to $75,000,000 in Riggs Capital Partners, our venture
capital division. We may temporarily invest the net proceeds or apply the net
proceeds to the reduction of short-term indebtedness.

Are There Any Recent Developments About Us That You Should Know About?
[Will update to include discussion of second quarter financials when they are
released.]
4
<PAGE>

What Is Our Ability to Generate Earnings to Pay Fixed Charges?
The table below shows our consolidated ratios of earnings to fixed charges and
preferred stock dividends for each of the years in the five-year period ended
December 31, 1998, and for the three months ended March 31, 1998 and 1999.

For the purpose of calculating the ratio of earnings to fixed charges and
preferred stock dividends, we have taken consolidated income before income
taxes and minority interest plus fixed charges, less interest capitalized
during such period, and divided this sum by fixed charges. Fixed charges
consist of consolidated interest expense, excluding or including interest on
deposits, as the case may be, and including capitalized interest during such
period.

Ratio of Earnings to Fixed Charges and Preferred Stock Dividends

<TABLE>
<CAPTION>
Three
Months
ended
Years ended December 31, March 31,
1994 1995 1996 1997 1998 1998 1999
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<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges
Excluding deposit interest................. 2.15 3.61 3.41 2.58 2.61 2.66 2.20
Including deposit interest................. 1.30 1.60 1.52 1.52 1.57 1.61 1.45
Ratio of earnings to fixed charges and
preferred stock dividends
Excluding deposit interest................. 1.52 2.74 2.51 2.18 2.28 2.30 2.20
Including deposit interest................. 1.17 1.49 1.41 1.44 1.49 1.52 1.45
</TABLE>

5
<PAGE>

Summary Consolidated Financial Data

This summary is qualified in its entirety by the detailed information included
in those documents incorporated by reference in this prospectus.

<TABLE>
<CAPTION>
Three Months
Years Ended December 31, Ended March 31,
1994 1995 1996 1997 1998 1998 1999
(dollars in thousands, except per share amounts)
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<S> <C> <C> <C> <C> <C> <C> <C>
Consolidated Summary of
Income
Interest income......... $266,005 $298,799 $293,198 $330,792 $353,802 $86,932 $81,527
Interest expense........ 112,723 147,821 139,891 151,501 163,450 39,247 35,701
Net interest income..... 153,282 150,978 153,307 179,291 190,352 47,685 45,826
Provision for loan
losses................. 6,300 (55,000) -- (12,000) -- -- --
Noninterest income...... 85,524 74,004 96,177 87,924 114,282 28,137 24,330
Noninterest expense..... 199,020 191,834 176,947 186,030 193,752 47,408 50,155
Income before income
taxes and minority
interest............... 33,486 88,148 72,537 93,185 110,882 28,414 20,001
Income tax expense
(benefit).............. (533) 346 6,174 24,690 29,088 7,792 7,298
Minority interest, net
of taxes............... -- -- 420 17,616 19,947 4,987 4,987
Net income.............. 34,019 87,802 65,943 50,879 61,847 15,635 7,716
Net income available for
common stock........... 21,895 77,052 55,193 40,129 38,185 12,947 7,716
Earnings Per Share
Net income.............. $0.72 $2.55 $1.82 $1.32 $1.25 $0.42 $0.27
Net income-assuming
dilution............... 0.72 2.54 1.79 1.27 1.21 0.41 0.26
Cash dividends.......... -- -- 0.15 0.20 0.20 0.05 0.05
Book value at period
end.................... 5.70 9.30 10.88 12.04 12.93 12.40 12.31
Weighted average common
shares................. 30,230,213 30,257,585 30,317,572 30,422,822 30,603,384 30,571,990 28,994,671
Weighted average common
shares and potential
common shares.......... 30,230,213 30,368,595 30,865,064 31,587,390 31,635,480 31,636,830 29,628,616
At Period End
Total assets............ $ 4,425,665 $ 4,732,533 $ 5,135,100 $ 5,846,426 $ 5,502,331 $ 5,636,629 $ 5,718,441
Reserve for loan
losses................. 97,039 56,546 64,486 52,381 54,455 52,180 53,004
Non-accrual and
renegotiated Loans..... 27,938 12,736 10,001 3,894 29,751 12,399 28,453
Other real estate
owned.................. 47,763 33,197 28,121 5,076 1,680 4,062 1,679
Total non-performing
assets................. 75,701 45,933 38,122 8,970 31,431 16,461 30,132
Loans................... 2,549,924 2,571,959 2,637,834 2,884,373 3,258,135 2,869,245 3,186,352
Deposits................ 3,602,794 3,885,179 4,050,683 4,297,918 4,144,848 3,989,150 4,175,741
Long-term debt.......... 217,625 217,625 191,525 191,525 191,525 191,525 191,525
Capital securities...... -- -- 150,000 350,000 350,000 350,000 350,000
Common shareholders'
equity................. 172,471 281,477 330,584 367,990 392,728 379,322 347,826
Total shareholders'
equity................. 267,663 376,669 425,776 463,182 392,728 474,514 347,826
Capital Ratios at Period
End
Equity to assets........ 6.05% 7.96% 8.29% 7.92% 7.14% 8.42% 6.08%
Tangible common equity
to tangible assets..... 3.44 5.59 6.15 6.01 6.90 6.45 5.87
Tier 1 risk-adjusted
capital................ 11.48 13.57 20.04 18.45 14.63 18.91 13.30
Total risk-adjusted
capital................ 18.50 21.62 28.47 31.52 27.51 31.84 26.59
Leverage................ 6.42 8.03 11.84 11.15 9.33 11.33 8.51
</TABLE>

The basis for the capital ratios presented in the table above is as follows:

. Tier 1 capital consists of (1) common shareholders' equity, excluding net
unrealized gains or losses on securities, except for net unrealized losses
on marketable equity securities, (2) perpetual preferred stock and (3)
trust preferred securities approximating 25% of Tier 1 capital; less
goodwill and other non-qualifying intangible assets.

. Total risk-adjusted capital consists of Tier 1 capital and Tier 2 capital.
Tier 2 capital consists of (1) subordinated debt, with certain
limitations, (2) qualifying preferred stock, (3) the qualifying portion of
the allowance for loan losses and (4) trust preferred securities not
included in Tier 1 capital. A bank holding company's Tier 2 capital may
not exceed its Tier 1 capital.

. The leverage ratio is Tier 1 capital as a percentage of average quarterly
total assets, less goodwill and other non-qualifying intangible assets.
Guidelines of the Federal Reserve provide for a minimum leverage ratio of
4% for bank holding companies that meet certain specified criteria,
including assignment of the highest regulatory rating.

6
<PAGE>

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Risk Factors

An investment in the trust preferred securities involves a number of risks,
some of which relate to the terms of the trust preferred securities or the
junior debentures and others of which relate to Riggs National Corporation and
its business. You should carefully review the following information about these
risks together with other information contained in this prospectus and in
documents incorporated by reference in this prospectus before deciding whether
this investment is suitable for you.

You Are Making an Investment Decision with Regard to the Junior Debentures As
Well As the Trust Preferred Securities.
The trust will rely on the payments it receives on the junior debentures to
fund all payments on the trust preferred securities. In addition, the trust may
distribute the junior debentures in exchange for the trust preferred securities
upon liquidation of the trust. Accordingly, you should carefully review the
information in this prospectus regarding both of these securities.

Payments on the Trust Preferred Securities Are Dependent on Our Payments on the
Junior Debentures.
The ability of the trust to make timely distributions on the trust preferred
securities and to pay the liquidation amount is dependent upon us making the
related payments on the junior debentures when due.

If we default on our obligation to pay principal of or interest on the junior
debentures, the trust will not have sufficient funds to pay distributions or
the liquidation amount. As a result, you will not be able to rely upon the
guarantee for payment of these amounts. You or the property trustee of the
trust may, however, sue us to enforce the rights of the trust under the junior
debentures. For more information, please refer to "Description of Trust
Preferred Securities -- Enforcement Rights" and "Relationship Among the Trust
Preferred Securities, the Junior Debentures, the Guarantee and the Expense
Agreement -- Enforcement Rights of Holders of Trust Preferred Securities".

Our Obligations Will Be Deeply Subordinated and We Will Pay Our Other Debt
Obligations Before We Pay You.
Our obligations under the guarantee and under the junior debentures are
unsecured and rank subordinate and junior in right of payment to all of our
senior debt, which includes nearly all of our existing junior indebtedness,
other than a total of $350.0 million debentures previously issued to our other
subsidiary trusts. For further information regarding our existing indebtedness,
see "Description of Guarantee and the Expense Agreement -- Status of the
Guarantee" and "Description of Junior Debentures -- Subordination".

Because we are a holding company, our right to participate in any distribution
of the assets of our subsidiaries, upon a subsidiary's dissolution, winding-up,
liquidation, reorganization or otherwise, and therefore your ability to benefit
indirectly from such distribution, is subject to the prior claims of creditors
of that subsidiary, except to the extent that we may be a creditor of that
subsidiary and our claims are recognized. There are legal limitations on the
extent to which some of our subsidiaries, including Riggs Bank, our principal
subsidiary, may extend credit, pay dividends or otherwise supply funds to us.
Accordingly, the junior debentures and the guarantee will be effectively
subordinated to all existing and future liabilities of our subsidiaries, and
holders of junior debentures and the guarantee should look only to our assets
for payments on the junior debentures and the guarantee.

Neither the indenture governing the junior debentures, nor the amended trust
agreement and the guarantee relating to the trust preferred securities, place
any limitation on the nature or amount of additional indebtedness that we or
our subsidiaries may incur in the future.

You Will Not Receive Timely Distributions If We Elect to Defer Payments.
At any time we may defer interest payments on the junior debentures for up to
20 consecutive quarterly periods, provided that (1) no deferral period may
extend beyond the stated maturity date of the junior debentures and (2) we are
not in default under the indenture governing the junior debentures. If there is
a deferral, the trust also will defer distributions on the trust preferred
securities. During a deferral period, your distributions will continue to
accrue, and interest on the unpaid distributions will compound quarterly.

At the end of any deferral period and after all accrued and unpaid interest has
been paid, we may elect to begin a new deferral period. There is no limitation
on the number of deferral periods. For further information on our option to
defer payments, see "Description of Trust Preferred

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Securities -- Distributions -- Deferral Periods", and "Description of Junior
Debentures -- Interest".

If We Elect to Defer Interest Payments, You Will Have to Include Interest in
Your Taxable Income Before You Receive the Money.
Although you will not be receiving cash distributions during a deferral period,
you will be required to accrue interest income for U.S. federal income tax
purposes on your proportionate share of the junior debentures held by the
trust, even if you are a cash basis taxpayer. As a result, you need to include
this income in your gross income for U.S. federal income tax purposes in
advance of the receipt of cash. You also will not receive the cash related to
any accrued and unpaid interest income from the trust if you dispose of the
trust preferred securities prior to the record date for the payment of
distributions. For further information, see "U.S. Federal Income Tax
Considerations -- Original Issue Discount" and "-- Sale or Redemption of Trust
Preferred Securities".

The Market Price of the Trust Preferred Securities May Not Reflect Unpaid
Interest and You May Suffer a Loss If You Sell Them While Interest Remains
Unpaid.
Because of our right to defer interest payments on the junior debentures, the
market price of the trust preferred securities may be more volatile than the
market prices of similar securities that do not have this feature. If we
exercise our right to defer, the market price of the trust preferred securities
may decline. Accordingly, the trust preferred securities that you purchase,
whether in this offering or in the secondary market, or the junior debentures
that you may receive on liquidation of the trust, may trade at a discount to
the price that you paid.

If you dispose of your trust preferred securities before the record date for
the payment of a distribution, then you will not receive that distribution.
However, you will be required to include accrued but unpaid interest on the
junior debentures through the date of the sale as ordinary income for U.S.
federal income tax purposes and to add the amount of the accrued but unpaid
interest to your tax basis in the trust preferred securities. Your increased
tax basis in the trust preferred securities will increase the amount of any
capital loss that you may have otherwise realized on the sale. In general, an
individual taxpayer may only offset $3,000 of capital losses against regular
income during any year. For further information on tax consequences, see "U.S.
Federal Income Tax Considerations -- Sale or Redemption of Trust Preferred
Securities".

We May Redeem the Junior Debentures at Any Time after July ., 2004, or upon the
Occurrence of Specified Tax or Regulatory Events.
We may redeem all or any part of the junior debentures at any time after July
., 2004. In addition, we may redeem all but not part of the junior debentures
within 90 days following the occurrence of specified tax or regulatory events,
including:

. any change in tax laws or regulations that poses a substantial risk that the
trust preferred securities might lose their special tax treatment; and

. any change in laws or regulations that poses a substantial risk that we will
not be able to treat the trust preferred securities as Tier 1 capital for
purposes of the Federal Reserve capital adequacy guidelines.

We will need the prior approval of the Federal Reserve to make a redemption, if
required at the time under applicable Federal Reserve capital guidelines or
policies. For further information on redemption, see "Description of Trust
Preferred Securities -- Redemption".

The Trust May Distribute the Junior Debentures in Exchange for the Trust
Preferred Securities, Which Could Affect the Market Price and Could Be a
Taxable Event.
We may dissolve the trust at any time. After satisfying its liabilities to its
creditors, the trust may distribute the junior debentures to the holders of the
trust preferred securities and common securities. We will not dissolve the
trust without the prior approval of the Federal Reserve, if required at the
time under applicable Federal Reserve capital guidelines or policies. For
further information, see "Description of Trust Preferred Securities --
Liquidation Distribution upon Termination".

We cannot predict the market prices for trust preferred securities or for
junior debentures that may be distributed in exchange for trust preferred
securities. Accordingly, the trust preferred securities, or the junior
debentures that you may receive on liquidation of the trust, may trade at a
discount to the price that you paid to purchase the trust preferred securities.

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Under current U.S. federal income tax law and assuming, as we expect, that the
trust will not be classified as an association taxable as a corporation, you
should not be taxed if we dissolve the trust and the trust distributes junior
debentures to you. However, if the trust were to become taxed on the income
received or accrued on the junior debentures due to a tax event, both you and
the trust might be taxed on a distribution of the junior debentures by the
trust. For further information, see "U.S. Federal Income Tax Considerations --
Distribution of Junior Debentures to Holders of Trust Preferred Securities upon
Liquidation of the Trust".

Investors Will Not Control the Administration of the Trust and Will Have
Limited Voting Rights.
We will hold all the common securities of the trust. These securities give us
the right to control nearly all aspects of the administration, operation or
management of the trust, including selection and removal of the administrative
trustees. The trust preferred securities, on the other hand, will generally
have no voting rights. You will be able to vote only on matters relating to the
modification of the terms of the trust preferred securities or the junior
debentures, the acceleration of payments and other matters described in this
prospectus. For further information, see "Description of Trust Preferred
Securities -- Voting Rights".

The Trading Characteristics of the Trust Preferred Securities May Adversely
Affect Their Liquidity.
The trust preferred securities will not be listed on a national securities
exchange or the NASDAQ Stock Market. The absence of such a listing could
adversely affect the liquidity of the trust preferred securities.

We Are Subject to Regulatory Capital Requirements.
We and each of our banking subsidiaries are subject to regulatory capital
guidelines. At March 31, 1999, each of our banking subsidiaries was in
compliance with applicable regulatory capital requirements. At that date, we
had a total capital to risk-weighted assets ratio of 26.6% and a Tier 1 capital
to risk-weighted assets ratio of 13.3%, both above the minimum requirements of
8.0% and 4.0%, respectively. Our leverage ratio at that date was 8.5%, which is
above the minimum requirement of 4.0%.

There can be no assurance that we or Riggs Bank will continue to meet our
respective minimum capital ratios. In the event that we or any of our banking
subsidiaries fall below the minimum capital requirements described above,
agencies may take regulatory action including, in the case of subsidiary banks,
prompt corrective action. Such actions could impair our ability to make
principal (or premium, if any) and interest payments on the junior debentures.

There are legal restrictions on the extent to which Riggs Bank may pay
dividends to us. Under current regulatory practice, a national bank may pay
dividends only out of current operating earnings.

On June 4, 1999, the Basle Committee on Banking Regulation and Supervisory
Practices proposed a new capital adequacy framework. Minimum capital
requirements under the new framework would be based on the current rules, but,
among other changes, would replace the existing risk weights for
sovereigns,banks, securities firms, corporate borrowers and asset
securitizations with risk weights based on external credit ratings, including
risk weights greater than 100% for low quality exposures. Capital charges for
interest rate risk and operational risk would also be applied to certain banks.
The new framework also would add a supervisory review process designed to
ensure that a bank's capital position is consistent with its overall risk
profile and strategy and that supervisors quickly address any deterioration in
capital adequacy. A third aspect of the new framework, market discipline, would
establish high disclosure standards for banks in order to enhance the role of
market participants in encouraging banks to hold adequate capital. The Basle
Committee plans to set forth more definitive proposals regarding the new
framework in the year 2000. We cannot predict at this time whether the new
capital adequacy framework will be adopted or in what form, or the effect it
would have on the financial condition or results of operations of the
Corporation.

Our Credit Risk Is Concentrated.
Geographically, our domestic loans are concentrated in the Washington, D.C.
metropolitan area. Loans originated by our United Kingdom subsidiary represent
most of our foreign loans and are predominantly to borrowers located in the
United Kingdom. If there is a decline in the credit quality of our borrowers in
the Washington, D.C. area or in the United Kingdom, this decline could have an
adverse effect upon our earnings and general financial condition.

We have participated in several large syndicated loan relationships, which,
when considered together, comprise a significant portion of our commercial loan
portfolio. If there is a decline in the credit quality of these loan
relationships, this decline could have an adverse effect upon our earnings and
general financial condition.

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We Compete With Many Other Financial Institutions.
We compete with commercial banks, thrift institutions, mortgage banks, credit
unions, brokerage firms and other institutions. Such competition is based
primarily on the scope and type of services offered, interest rates paid on
deposits, pricing of loans and the number and locations of branches. In
addition, competition has intensified in the Washington, D.C. metropolitan
area. During the past few years, significant consolidation among financial
institutions in the Washington, D.C. metropolitan area has occurred, including
significant acquisitions in this market by our competitors, whose headquarters
are outside the Washington, D.C. metropolitan area. These competitors also
aggressively target many of the same customers as we do, including high net
worth individuals and embassies and foreign missions. These competitors and
certain other of our competitors have substantially greater resources than we
do. Although we believe we have been able to compete effectively in our market
areas, there can be no assurance that we will be able to continue to do so.

The Year 2000 Issue May Cause Computer Problems.
Many existing computer programs use only two digits to identify a year in a
data field. These programs were designed and developed without considering the
upcoming end of the century. If not corrected, many computer applications could
fail or create erroneous results by or at the Year 2000. The Year 2000 issue
affects us because the financial services industry depends heavily on computer
applications. For information regarding our efforts in handling the Year 2000
issue, see "Management's Discussion and Analysis of Financial Condition and
Results of Operations -- Year 2000 Readiness Disclosure."

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Riggs National Corporation

We are a bank holding company registered under the Bank Holding Company Act of
1956, as amended, and incorporated in the State of Delaware. Based on total
assets, we are the 80th largest bank holding company in the United States and
the largest bank holding company headquartered in Washington, D.C. As of March
31, 1999, we had consolidated assets of $5.7 billion, consolidated deposits of
$4.2 billion and consolidated stockholders' equity of $347.8 million.

We engage in commercial, retail and international banking activities, as well
as trust, broker-dealer, venture capital and other financial services, which we
provide to selected domestic and international markets. Additionally, we
provide investment advisory services domestically through subsidiaries
registered under the Investment Advisers Act of 1940. A subsidiary located in
the Bahamas provides off-shore trust and corporate services. At March 31, 1999,
we and our subsidiaries had 1,600 full-time equivalent employees.

The consolidation currently underway in the local banking industry has left us
as the only independent commercial bank with assets in excess of $1 billion
headquartered in Washington, D.C. As of December 31, 1997, Riggs Bank had the
largest share of total deposits in Washington, D.C. at approximately 23%, based
upon a recent published report. We believe that we enjoy a highly respected
position in Washington, D.C. because of our local management, name recognition
and commitment to the community, which has resulted in this leading deposit
share.

We believe that as the largest commercial bank holding company headquartered in
the nation's capital, we have a unique position in the center of an affluent
market combining significant public and private sector customers. Our primary
mission is to provide a full range of quality banking services throughout the
greater Washington, D.C. community. In order to capitalize on our strong market
position, deposit share and reputation in the Washington, D.C. area, we are
implementing a strategy which emphasizes our ability to offer loan, deposit,
brokerage and investment advisory services. As part of this strategy, we will
offer our customers a breadth of financial products typical of a regional bank
with the personalized service and local decision-making of a community bank. We
believe that our size will allow us to offer a broader product line than our
smaller competitors, while our personalized service and local decision-making
will give us a distinct advantage over our larger regional competitors. Local
decision-making and a commitment to the community will be the key to retaining
our existing customers and building new relationships.

Key elements of our business strategy for our subsidiaries are to continue to
focus on:

. growth opportunities through the additional accumulation of assets under
management in Riggs & Co.;

. the orientation of our retail banking branches toward money management
relationships;

. the development and specialization in relationship banking of banking
products and services in specific growth industries; and

. our continued preeminence in embassy banking operations coupled with growth
in selected international business lines.

Such growth will entail internally developed programs as well as possible
alliances or acquisitions in these areas. We will continue to serve the varied
financial needs of the Washington, D.C. metropolitan area.

Our principal executive office is located at 1503 Pennsylvania Avenue, N.W.,
Washington, D.C. 20005. Our telephone number is (202) 835-4309.

OUR SUBSIDIARIES

Riggs Bank National Association
Our principal subsidiary is Riggs Bank N.A. As of March 31, 1999, Riggs Bank
had assets of $5.2 billion, deposits of $4.2 billion, and stockholders' equity
of $429.5 million. Riggs Bank operates:

. 32 branches in Washington, D.C., 15 branches in Virginia, six branches in
Maryland, as well as branch offices in London, England and Nassau, Bahamas;

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. investment advisory subsidiaries in Washington, D.C. and New Haven,
Connecticut;

. a broker-dealer subsidiary in Washington, D.C.;

. a commercial bank in London, England;

. an Edge Act subsidiary in Miami, Florida; and

. a Bahamian bank and trust company.

As a commercial bank, Riggs Bank provides a wide array of financial services to
customers in the Washington, D.C. metropolitan area, throughout the United
States and internationally.

Riggs Bank's relationship banking group provides services to customers ranging
from small regional businesses to major multinational companies. These services
include lines of credit, secured and unsecured term loans, letters of credit,
credit support facilities, foreign currency transactions and cash management.

Riggs Bank's community banking group provides a variety of services including
checking, NOW, savings and money market accounts, loans and personal lines of
credit, certificates of deposit and individual retirement accounts.
Additionally, the community banking group provides home banking services,
internet services through its web site (www.riggsbank.com) and 24-hour banking
services through its telebanking operations and a network of Riggs Bank's
automated teller machines, as well as national and regional ATM networks.

Riggs Bank's international banking group furnishes a variety of financial
services including issuing letters of credit in connection with trade and other
transactions, taking deposits, foreign exchange and cash management. Customers
include embassies and foreign missions in Washington, D.C., foreign
governments, central banks, and over 200 correspondent banks around the world.
These services are provided through both domestic and international offices.

Additional international operations of Riggs Bank include:

. Riggs Bank Europe Limited, located in London, England, providing traditional
corporate banking services, commercial property financing and trade finance;

. Riggs Bank and Trust Company (Bahamas) Limited, in Nassau, providing trust
services for international private banking customers;

. a London branch located in the U.S. Embassy, serving the embassy, its
employees and official visitors; and

. a branch office located in the west end of London which provides banking
services to foreign embassies in London.

Riggs Bank's financial services division, Riggs & Co., provides fiduciary and
administrative services, including financial management and tax planning for
individuals, investment and advisory services for governmental, corporate and
non-profit organizations, estate planning and trust administration.

Riggs Bank provides investment advisory services through Riggs Investment
Management Corporation and J. Bush & Co. Incorporated, both of which are
wholly-owned subsidiaries incorporated under the laws of Delaware and
registered under the Investment Advisers Act of 1940.

Riggs Capital
Riggs Capital is a special purpose subsidiary established in December 1996 to
issue 150,000 shares of 8.625% trust preferred securities, Series A, with a
liquidation preference of $1,000 per share. See "Notes to Consolidated
Financial Statements -- Note 1 and Note 11" of the 10-K for 1998.

Riggs Capital II
Riggs Capital II is a special purpose subsidiary established in March 1997 to
issue 200,000 shares of 8.875% trust preferred securities, Series C, with a
liquidation preference of $1,000 per share. See "Notes to Consolidated
Financial Statements -- Note 1 and Note 11" of the 10-K for 1998.

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Riggs Capital III

Riggs Capital III is a statutory business trust created under Delaware law and
our subsidiary. The trust was created under (1) a trust agreement, dated as of
June 15, 1999, executed by us, as depositor, The Bank of New York, as property
trustee, The Bank of New York (Delaware), as Delaware trustee, and the
administrative trustees named in the trust agreement, and (2) the filing of a
certificate of trust with the Delaware Secretary of State on June 15, 1999.
This trust agreement will be amended and restated in its entirety,
substantially in the form filed as an exhibit to the registration statement.

The trust will issue the trust preferred securities and the common securities
under the amended trust agreement. The trust preferred securities will
represent preferred undivided beneficial interests in the assets of the trust,
and the common securities will represent common undivided beneficial interests
in the assets of the trust.

At the closing of the offering, we will purchase all of the common securities
from the trust. The common securities will represent at least 3% of the trust's
total capital at the closing. The trust preferred securities will represent the
remaining 97% or less of the trust's total capital at the closing. We will
continue to hold all the common securities, directly or through our
subsidiaries, after the closing.

The trust exists solely for the following purposes:

. to issue and sell the trust preferred securities and common securities;

. to use the proceeds from the sale of the trust preferred securities and
common securities to acquire the junior debentures; and

. to engage only in those other activities that are necessary or incidental to
those activities.

The trust will have no assets other than the junior debentures and the right to
receive reimbursement of certain expenses under an expense agreement.
Consequently, the trust will have no revenue other than payments under the
junior debentures and the expense agreement.

The trust has a term of approximately 31 years but may terminate earlier as
provided in the amended trust agreement. The trust's business and affairs will
be conducted by its trustees. The trustees will include The Bank of New York,
as property trustee, and The Bank of New York (Delaware), as Delaware trustee.
In addition, as the holder of the common securities, we will select two
individuals who will act as administrative trustees of the trust. The
administrative trustees will initially be our employees or officers.

We will fully, irrevocably and unconditionally guarantee the trust preferred
securities to the extent that the trust has funds sufficient to make payments.
We also will reimburse the trust for all of its expenses and liabilities other
than the trust's obligations under the trust preferred securities and the
common securities. We also will pay the expenses of this offering, including
the underwriters' commissions.

The trust does not have separate financial statements. The statements would not
be material to holders of the trust preferred securities because the trust has
no independent operations. Therefore, for financial reporting purposes, the
trust will be treated as our subsidiary. Accordingly, the accounts of the trust
will be included in our consolidated financial statements. In addition, we
anticipate that the trust will not be subject to the reporting requirements of
the Securities Exchange Act of 1934.

The principal executive office of the trust is 1503 Pennsylvania Avenue, N.W.,
Washington, D.C. 20005, Attention: Office of the Secretary, and its telephone
number is (202) 835-4309.

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Use of Proceeds

The trust will invest all of the proceeds from the sale of the trust preferred
securities and the common securities in the junior debentures. We will use the
net proceeds from the sale of our junior debentures to the trust for general
corporate purposes. These purposes may include, but are not limited to:

. the repurchase or redemption of up to $125,000,000 of our 8.50% subordinated
notes due 2006; and

. investment of up to $75,000,000 in Riggs Capital Partners, our venture
capital division.

We may temporarily invest the net proceeds or apply the net proceeds to the
reduction of short-term indebtedness.

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Capitalization

The following table sets forth our consolidated capitalization (1) as of March
31, 1999 and (2) as adjusted to give effect to the consummation of the offering
of the trust preferred securities and the redemption of the 8.50% subordinated
notes due 2006, including additional costs and adjustments related thereto.

You should read the following data in conjunction with our consolidated
financial statements and information incorporated by reference in this
prospectus.

<TABLE>
<CAPTION>
March 31, 1999
Actual As Adjusted
(in thousands)
- -------------------------------------------------------------------------------
<S> <C> <C>
Long-term debt
9.65% subordinated debentures due 2009................ $ 66,525 $ 66,525
8.50% subordinated notes due 2006..................... 125,000 --
-------- --------
Total long-term debt................................. 191,525 66,525
======== ========
Guaranteed preferred beneficial interests in:
8.625% junior subordinated deferrable interest
debentures, series A................................ 150,000 150,000
8.875% junior subordinated deferrable interest
debentures, series C................................ 200,000 200,000
Floating rate junior subordinated deferrable interest
debentures, series D................................ -- 200,000
-------- --------
Total guaranteed preferred beneficial interests in
junior subordinated deferrable interest debentures.. 350,000 550,000
======== ========
Stockholders' equity
Common stock
$2.50 Par value, shares authorized -- 50,000,000;
shares issued -- 31,556,545......................... 78,891 78,891
Surplus
Common stock.......................................... 160,773 160,773
Undivided profits...................................... 191,047 185,924
Accumulated other comprehensive income................. (11,528) (11,528)
Treasury stock -- 3,300,798 shares at March 31, 1999... (71,357) (71,357)
-------- --------
Total stockholders' equity........................... 347,826 342,703
======== ========
Total long-term debt, guaranteed preferred beneficial
interests in junior subordinated deferrable interest
debentures and stockholders' equity.................. $889,351 $959,228
======== ========
Certain capital ratios:
Tier 1 capital-risk-weighted.......................... 13.30% 13.06%
Combined Tier 1 & 2 capital-risk-weighted............. 26.59% 26.12%
Leverage.............................................. 8.51% 8.39%
</TABLE>

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Selected Consolidated Financial Data

The following table presents summary consolidated financial data for each of
the years in the five-year period ended December 31, 1998 and for each of the
quarterly periods ended March 31, 1998 and 1999. The data for each of the years
in the five-year period ended December 31, 1998 has been derived from, and
should be read in conjunction with, our audited consolidated financial
statements, accompanying notes and other information pertaining to us included
in the documents incorporated by reference in this prospectus. The data
presented for the three-month periods ended March 31, 1998 and March 31, 1999
are not necessarily indicative of the data for the entire year and have been
derived from, and should be read in conjunction with, our unaudited
consolidated financial statements incorporated by reference in this prospectus.
These financial statements include, in the opinion of management, all
adjustments of a normal recurring nature and disclosures which are necessary to
present fairly the data for these interim periods.

This summary is qualified in its entirety by the detailed information included
in those documents incorporated by reference in this prospectus.

<TABLE>
<CAPTION>
Three Months
Years Ended December 31, Ended March 31,
1994 1995 1996 1997 1998 1998 1999
(dollars in thousands, except per share amounts)
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Consolidated Summary of
Income
Interest income......... $266,005 $298,799 $293,198 $330,792 $353,802 $86,932 $81,527
Interest expense........ 112,723 147,821 139,891 151,501 163,450 39,247 35,701
Net interest income..... 153,282 150,978 153,307 179,291 190,352 47,685 45,826
Provision for loan
losses................ 6,300 (55,000) -- (12,000) -- -- --
Noninterest income...... 85,524 74,004 96,177 87,924 114,282 28,137 24,330
Noninterest expense..... 199,020 191,834 176,947 186,030 193,752 47,408 50,155
Income before income
taxes and minority
interest.............. 33,486 88,148 72,537 93,185 110,882 28,414 20,001
Income tax expense
(benefit)............. (533) 346 6,174 24,690 29,088 7,792 7,298
Minority interest, net
of taxes.............. -- -- 420 17,616 19,947 4,987 4,987
Net income.............. 34,019 87,802 65,943 50,879 61,847 15,635 7,716
Dividends on preferred
stock................. 12,124 10,750 10,750 10,750 9,854 2,688 --
Excess of call price
over carrying amount
of preferred stock.... -- -- -- -- 13,808 -- --
Net income available for
common stock.......... 21,895 77,052 55,193 40,129 38,185 12,947 7,716
Earnings Per Share
Net income.............. $0.72 $2.55 $1.82 $1.32 $1.25 $0.42 $0.27
Net income-assuming
dilution.............. 0.72 2.54 1.79 1.27 1.21 0.41 0.26
Cash dividends.......... -- -- 0.15 0.20 0.20 0.05 0.05
Book value at period
end................... 5.70 9.30 10.88 12.04 12.93 12.40 12.31
Weighted average common
shares................ 30,230,213 30,257,585 30,317,572 30,422,822 30,603,384 30,571,990 28,994,671
Weighted average common
shares and potential
common shares......... 30,230,213 30,368,595 30,865,064 31,587,390 31,635,480 31,636,830 29,628,616
At Period End
Loans................... $2,549,924 $2,571,959 $2,637,834 $2,884,373 $3,258,135 $2,869,245 $3,186,352
Earning assets.......... 3,979,588 4,196,339 4,621,463 5,347,736 5,000,044 5,195,035 5,238,247
Total assets............ 4,425,665 4,732,533 5,135,100 5,846,426 5,502,331 5,636,629 5,718,441
Deposits................ 3,602,794 3,885,179 4,050,683 4,297,918 4,144,848 3,989,150 4,175,741
Long-term debt.......... 217,625 217,625 191,525 191,525 191,525 191,525 191,525
Capital securities...... -- -- 150,000 350,000 350,000 350,000 350,000
Common shareholders'
equity................ 172,471 281,477 330,584 367,990 392,728 379,322 347,826
Total shareholders'
equity................ 267,663 376,669 425,776 463,182 392,728 474,514 347,826
</TABLE>

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<TABLE>
<CAPTION>
Three Months
Years Ended December 31, Ended March 31,
1994 1995 1996 1997 1998 1998 1999
(dollars in thousands, except per share amounts)
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Performance Ratios
Return on average total
assets................ 0.76% 1.92% 1.40% 0.97% 1.11% 1.15% 0.57%
Return on average common
equity................ 12.58 35.73 18.10 11.80 9.97 14.13 8.61
Return on average total
equity................ 12.01 28.25 16.48 11.69 13.61 13.59 8.61
Efficiency.............. 82.26 84.13 71.92 69.53 66.22 66.46 70.74
Net interest margin
(tax-equivalent)...... 3.89 3.74 3.72 3.81 3.78 3.90 3.78
Capital Ratios at Period
End
Equity to assets........ 6.05% 7.96% 8.29% 7.92% 7.14% 8.42% 6.08%
Tangible common equity
to tangible assets.... 3.44 5.59 6.15 6.01 6.90 6.45 5.87
Tier 1 risk-adjusted
capital............... 11.48 13.57 20.04 18.45 14.63 18.91 13.30
Total risk-adjusted
capital............... 18.50 21.62 28.47 31.52 27.51 31.84 26.59
Leverage................ 6.42 8.03 11.84 11.15 9.33 11.33 8.51
Asset Quality Data
Nonperforming loans..... $27,938 $12,736 $10,001 $3,894 $29,751 $12,399 $28,453
Nonperforming assets.... 75,701 45,933 38,122 8,970 31,431 16,461 30,132
Allowance for loan
losses................ 97,039 56,546 64,486 52,381 54,455 52,180 53,004
Net loan charge-offs
(recoveries).......... (3,028) (14,538) (6,575) (472) (1,980) 427 1,197
Nonperforming loans to
period end loans...... 1.10% 0.50% 0.38% 0.14% 0.91% 0.43% 0.89%
Nonperforming assets to
period end loans plus
other real estate
owned, net............ 2.91 1.76 1.43 0.31 0.96 0.57 0.95
Allowance for loan
losses to period end
loans................. 3.81 2.20 2.44 1.82 1.67 1.82 1.66
Net loan charge-offs
(recoveries) to
average loans......... (0.12) (0.57) (0.26) (0.02) (0.06) 0.02 0.04
</TABLE>

The basis for the capital ratios presented in the table above is as follows:

. Tier 1 capital consists of (1) common shareholders' equity, excluding net
unrealized gains or losses on securities, except for net unrealized losses on
marketable equity securities, (2) perpetual preferred stock and (3) trust
preferred securities approximating 25% of Tier 1 capital; less goodwill and
other non-qualifying intangible assets.

. Total risk-adjusted capital consists of Tier 1 capital and Tier 2 capital.
Tier 2 capital consists of (1) subordinated debt with certain limitations,
(2) qualifying preferred stock, (3) the qualifying portion of the allowance
for loan losses and (4) trust preferred securities not included in Tier 1
capital. A bank holding company's Tier 2 capital may not exceed its Tier 1
capital.

. The leverage ratio is Tier 1 capital as a percentage of average quarterly
total assets, less goodwill and other non-qualifying intangible assets.
Guidelines of the Federal Reserve provide for a minimum leverage ratio of 4%
for bank holding companies that meet certain specified criteria, including
assignment of the highest regulatory rating.

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17
<PAGE>

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

Management's Discussion and Analysis of Financial Condition and Results of
Operations

OVERVIEW

Earnings per share for the first quarter of 1999 were $.26 compared to $.41 in
the first quarter of 1998. Excluding nonrecurring securities gains and applying
full income tax rates in the first quarter of 1998, earnings per share of $.26
for the first quarter of 1999 would have compared to $.22 for the first quarter
of 1998. Earnings per share for the first quarter of 1999 benefited from
redemption of our $100.0 million 10.75% noncumulative perpetual preferred stock
on October 1, 1998 and subsequent repurchases of common stock which aggregated
2,400,000 shares for a cost of $47.6 million at March 31, 1999. In addition, we
made a significant contribution in the first quarter to a local charitable
foundation. Noninterest income excluding securities gains totaled $24.2 million
in the first quarter of 1999, compared to $22.8 million in the first quarter of
1998. This increase was due to continued growth in the trust and investment
advisory income of Riggs & Company, our private client services and investment
management division. We continue to maintain a strong capital position with
total and leverage capital ratios of 26.6% and 8.5% at March 31, 1999, compared
to regulatory minimums of 8.0% and 4.0%.

RESULTS OF OPERATIONS

Net income for the first quarter of 1999 was $7.7 million compared to net
income of $15.6 million in the first quarter of 1998, a decrease of $7.9
million primarily due to nonrecurring securities gains and a lower income tax
rate in the first quarter of 1998 combined with the impact of our preferred
stock redemption in the fourth quarter of 1998. Earnings per share decreased to
$.26 from $.41 in the first quarter of 1998.

Net Interest Income
Net interest income on a tax-equivalent basis (net interest income plus an
amount equal to the tax savings on tax-exempt interest) totaled $46.7 million
in the first quarter of 1999, decreasing $1.8 million from the first quarter of
1998. The decrease from the prior year's quarter was primarily due to funds
expended in redeeming preferred stock in the fourth quarter of 1998 and common
stock in both the fourth quarter of 1998 and the first quarter of 1999.

<TABLE>
<CAPTION>
Three Months Ended
March 31, 1999 vs 1998
----------------------------------
Due To Due To Total
Net Interest Income Changes (1) Rate Volume Change
(in thousands)
----------------------------------
<S> <C> <C> <C>
Interest Income:
Loans, Including Fees.............................. $(3,752) $ 6,582 $ 2,830
Securities Available for Sale...................... (1,249) (5,534) (6,783)
Time Deposits with Other Banks..................... (613) 1,879 1,266
Federal Funds Sold and Reverse Repurchase
Agreements....................................... (576) (2,137) (2,713)
------- ------- -------
Total Interest Income............................... (6,190) 790 (5,400)
Interest Expense:
Interest-Bearing Deposits.......................... (6,109) 3,678 (2,431)
Repurchase Agreements and Other Short-Term
Borrowings....................................... (1,093) (22) (1,115)
Long-Term Debt..................................... -- -- --
------- ------- -------
Total Interest Expense.............................. (7,202) 3,656 (3,546)
------- ------- -------
Net Interest Income................................. $ 1,012 $(2,866) $(1,854)
======= ======= =======
</TABLE>

(1) The dollar amount of changes in interest income and interest expense
attributable to changes in rate/volume (change in rate multiplied by change
in volume) has been allocated between rate and volume variances based on
the percentage relationship of such variances to each other. Income and
rates are computed on a tax-equivalent basis using a Federal income tax
rate of 35% and local tax rates as applicable.

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

18
<PAGE>

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

<TABLE>
<CAPTION>
Three Months Ended Three Months Ended
March 31, 1999 March 31, 1998
Average Consolidated
Statements Of Condition And Average Income/ Average Income/
Rates Balance Expense Rate Balance Expense Rate
(Tax-equivalent basis) (1)
(in thousands)
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Assets
Loans, Including Fees (2).. $3,198,165 $58,352 7.40% $2,836,563 $55,522 7.94%
Securities Available for
Sale (3)................. 1,016,963 14,664 5.85 1,396,095 21,447 6.23
Time Deposits with Other
Banks.................... 615,598 7,234 4.77 459,421 5,968 5.27
Federal Funds Sold and
Reverse Repurchase
Agreements............... 176,341 2,106 4.84 349,729 4,819 5.59
---------- ------- ---- ---------- ------- ----
Total Earning Assets and
Average Rate Earned..... 5,007,067 82,356 6.67 5,041,808 87,756 7.06
Reserve for Loan Losses.... (54,213) (52,446)
Cash and Due from Banks.... 144,799 155,630
Other Assets............... 400,197 355,346
---------- ----------
Total Assets.............. $5,497,850 $5,500,338
Liabilities, Minority
Interest And
Stockholders' Equity
Interest-Bearing Deposits.. $3,517,378 $27,355 3.15% $3,175,472 $29,786 3.80%
Repurchase Agreements and
Other Short-Term
Borrowings............... 400,953 3,978 4.02 402,697 5,093 5.13
Long-Term Debt............. 191,525 4,368 9.25 191,525 4,368 9.25
---------- ------- ---- ---------- ------- ----
Total Interest-Bearing
Funds and Average Rate
Paid.................... 4,109,856 35,701 3.52 3,769,694 39,247 4.22
Demand Deposits............ 621,604 850,627
Other Liabilities.......... 53,122 63,351
Minority Interest in
Preferred Stock of
Subsidiaries............. 350,000 350,000
Stockholders' Equity....... 363,268 466,666
---------- ----------
Total Liabilities,
Minority Interest and
Stockholders' Equity.... $5,497,850 $5,500,338
---------- ----------
Net Interest Income and
Spread................... $46,655 3.15% $48,509 2.84%
------- ---- ------- ----
Net Interest Margin on
Earning Assets........... 3.78% 3.90%
</TABLE>

(1) Income and rates are computed on a tax-equivalent basis using a Federal
income tax rate of 35% and local tax rates as applicable.
(2) Nonperforming loans are included in average balances used to determine
rates.
(3) The averages and rates for the securities available for sale portfolio are
based on amortized cost.

Noninterest Income
Noninterest income for 1999, excluding securities gains, totaled $24.2 million,
an increase of $1.4 million from the first quarter of 1998. The increase in
noninterest income was due to a 13% increase in trust and investment advisory
income of Riggs & Company, our private client services and investment
management division.

Noninterest Expense
Noninterest expense for the first quarter of 1999 was $50.2 million, up 6% from
the $47.4 million reported in the first quarter of 1998. The increase was due
substantially to added personnel costs during the year, primarily attributable
to increased incentive-based compensation and staff costs associated with new
business initiatives. In addition, we made a contribution of $500 thousand to a
local charitable foundation in the first quarter of 1999.

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

19
<PAGE>

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

FINANCIAL CONDITION

Securities
Securities available for sale totaled $1.29 billion at March 31, 1999, compared
to $970.7 million at year-end 1998, and $1.42 billion at March 31, 1998. The
activity for the first three months included purchases of securities available
for sale totaling $1.40 billion, which were partially offset by maturities and
sales/calls of securities available for sale totaling $1.01 billion and $54.0
million, respectively. The weighted-average durations and yields for the
portfolio, adjusted for anticipated prepayments, were approximately 3.6 years
and 5.63%, respectively, at March 31, 1999.

<TABLE>
<CAPTION>
March 31, 1999 March 31, 1998 December 31, 1998
Amortized Market/ Amortized Market/ Amortized Market/
Available for Sale Cost Book Value Cost Book Value Cost Book Value
- -----------------------------------------------------------------------------------------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
U.S. Treasury
Securities............ $ 188,397 $ 179,274 $ 404,512 $ 404,382 $113,677 $111,750
Government Agencies
Securities............ 541,288 541,258 769,245 769,194 391,165 391,344
Mortgage-Backed
Securities............ 532,183 526,516 204,906 204,723 424,152 423,503
Other Securities........ 42,532 43,383 39,689 42,043 43,577 44,131
---------- ---------- ---------- ---------- -------- --------
Total................... $1,304,400 $1,290,431 $1,418,352 $1,420,342 $972,571 $970,728
</TABLE>

Loans
At March 31, 1999, total loans outstanding amounted to $3.19 billion,
decreasing $71.8 million from the December 31, 1998 total of $3.26 billion. The
decrease in loans from December 31, 1998, was primarily attributed to decreases
in residential mortgage loans of $44.4 million, real estate-
commercial/construction loans of $30.0 million, and foreign loans of $16.7
million, partially offset by an increase of $22.3 million in commercial and
financial loans.

<TABLE>
<CAPTION>
March 31, March 31, December 31,
1999 1998 1998
- ------------------------------------------------------------------------------
(In thousands)
<S> <C> <C> <C>
Commercial and Financial................. $ 691,090 $ 583,733 $ 668,778
Real Estate -- Commercial/Construction... 379,580 395,464 409,586
Residential Mortgage..................... 1,231,855 1,133,915 1,276,257
Home Equity.............................. 309,879 314,451 314,347
Consumer................................. 71,701 66,602 69,419
Foreign.................................. 505,335 374,246 522,032
---------- ---------- ----------
Total Loans.............................. 3,189,440 2,868,411 3,260,419
Net Deferred Loan Fees, Premiums and
Discounts.............................. (3,088) 834 (2,284)
---------- ---------- ----------
Loans.................................... $3,186,352 $2,869,245 $3,258,135
</TABLE>

Asset Quality

Nonperforming Assets
Nonperforming assets, which include nonaccrual loans, renegotiated loans and
other real estate owned, net, totaled $30.1 million at March 31, 1999, a $1.3
million (4%) decrease from the year-end 1998 total of $31.4 million and a $13.6
million (82%) increase from the March 31, 1998 total. The increase in
nonaccrual loans from March 1998 was mainly due to a $25.0 million commercial
loan placed on nonaccrual during the fourth quarter of 1998 partially offset by
repayment of another large nonperforming loan.

Past-Due and Potential Problem Loans
Past-due loans consist of residential real estate loans, commercial and
industrial loans, and consumer loans that are in the process of collection and
are accruing interest. Past-due loans decreased $16.3 million during the first
three months of 1999 to $9.0 million, mostly due to repayment of a foreign
government overdraft of $15.8 million.

At March 31, 1999, we had identified $1.0 million in potential problem loans
that are currently performing but that we believe have certain attributes that
may lead to nonaccrual or past due status in the foreseeable future. This
balance consisted entirely of residential real estate and consumer loans. There
were no potential problem loans at December 31, 1998.

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20
<PAGE>

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<TABLE>
<CAPTION>
March 31, March 31, December 31,
Nonperforming Assets and Past-Due Loans 1999 1998 1998
- -------------------------------------------------------------------------------
(in thousands)
<S> <C> <C> <C>
Nonperforming Assets:
Nonaccrual Loans (1).......................... $26,681 $12,314 $26,831
Renegotiated Loans (2)........................ 1,772 85 2,920
Other Real Estate Owned, Net.................. 1,679 4,062 1,680
------- ------- -------
Total Nonperforming Assets.................... $30,132 $16,461 $31,431
Past-Due Loans (3)............................ $ 8,950 $11,412 $25,269
</TABLE>

(1) Loans (other than consumer) that are in default in either principal or
interest for 90 days or more that are not well-secured and in the process
of collection, or that are, in our opinion, doubtful as to the
collectibility of either interest or principal.
(2) Loans for which terms have been renegotiated to provide a reduction of
interest or principal as a result of a deterioration in the financial
position of the borrower. Renegotiated loans do not include $6.4 million in
loans renegotiated at market terms that have performed in accordance with
their respective renegotiated terms.
(3) Loans contractually past due 90 days or more in principal or interest that
are well-secured and in the process of collection.

Deposits

Deposits are our primary and most stable source of funds. Deposits totaled
$4.18 billion at March 31, 1999, increasing $30.9 million from the December 31,
1998 deposit total. The increase from the year-end balance was due primarily to
increases in money market deposit accounts and time deposits in domestic
offices of $94.6 million and $48.3 million, respectively, partially offset by
decreases in demand deposits of $47.0 million and in savings and NOW accounts
of $44.6 million.

Short-term Borrowings and Long-term Debt

Short-term borrowings increased by $21.2 million, or 6%, from the year-end 1998
balance. Short-term borrowings are an additional source of funds that we have
utilized to meet certain asset/liability and daily cash management objectives.
The increase in short-term borrowings from year-end was primarily due to
increases in repurchase agreements, which are a funding vehicle for us. Short-
term borrowings are used to help us generate cash and maintain adequate levels
of liquidity.

<TABLE>
<CAPTION>
March 31, March 31, December 31,
1999 1998 1998
- ------------------------------------------------------------------------------
(in thousands)
<S> <C> <C> <C>
Repurchase Agreements and Other Short-Term
Borrowings................................. $395,617 $453,990 $374,380
Subordinated Debentures due 2009............. 66,525 66,525 66,525
Subordinated Notes due 2006.................. 125,000 125,000 125,000
-------- -------- --------
Total Long-Term Debt......................... 191,525 191,525 191,525
-------- -------- --------
Total Short-Term Borrowings and Long-Term
Debt....................................... $587,142 $645,515 $565,905
</TABLE>

Liquidity

We seek to maintain sufficient liquidity to meet the needs of depositors,
borrowers and creditors at a reasonable cost and without undue stress on our
operations and those of our banking subsidiaries. Our asset/liability committee
actively analyzes and manages liquidity in coordination with other areas of the
organization. At March 31, 1999, our liquid assets, on a consolidated basis,
which include cash and due from banks, Government obligations and other
securities, federal funds sold, reverse repurchase agreements and time deposits
at other banks, totaled $2.18 billion (38% of total assets). This compares with
$1.90 billion (34%) at December 31, 1998, and $2.47 billion (44%) at March 31,
1998. At March 31, 1999, $807.5 million of our assets were pledged to secure
deposits and other borrowings. This compares with pledged assets of $727.4
million at December 31, 1998, and $815.8 million at March 31, 1998.

Our liquidity position is maintained by a stable source of funds from our core
deposit relationships. We have other sources of funds, such as short-term
credit lines available from several Federal Home Loan Banks and

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21
<PAGE>

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

other financial institutions. In addition, we had a line of credit available
through our membership in the Federal Home Loan Bank of Atlanta (FHLB Atlanta).
At March 31, 1999 and December 31, 1998, short-term credit lines and the FHLB
Atlanta line of credit available totaled approximately $1.50 billion, and $932
million at March 31, 1998. Of this availability, $14.5 million, $19.3 million,
and $19.1 million were outstanding at March 31, 1999, December 31, 1998, and
March 31, 1998.

Stockholders' Equity and Regulatory Capital

Total stockholders' equity at March 31, 1999 was $347.8 million, a decrease of
$44.9 million from the year-end 1998 total and down $126.7 million from March
31, 1998. The decreases from both prior periods were primarily the result of
the redemption of our $100 million 10.75% noncumulative perpetual preferred
stock on October 1, 1998, and repurchases of common stock in the fourth quarter
of 1998 and first quarter of 1999. These common stock repurchases aggregated
2,400,000 shares for a cost of $47.6 million at March 31, 1999. Book value per
common share was $12.31 as of March 31, 1999 compared to $12.93 at year-end
1998 and $12.40 at March 31, 1998. The following are our capital ratios and
those of our banking subsidiary, Riggs Bank National Association (Riggs Bank
N.A.) at March 31, 1999 and 1998, and December 31, 1998:

<TABLE>
<CAPTION>
March 31, March 31, December 31, Required
1999 1998 1998 Minimums
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Riggs National Corporation:
Tier 1........................... 13.30% 18.91% 14.63% 4.00%
Combined Tier 1 and Tier 2....... 26.59 31.84 27.51 8.00
Leverage......................... 8.51 11.33 9.33 4.00
Riggs Bank N.A.:
Tier 1........................... 12.64 13.02 12.17 4.00
Combined Tier 1 and Tier 2....... 13.89 14.28 13.43 8.00
Leverage......................... 8.51 8.08 8.26 4.00
</TABLE>

YEAR 2000 READINESS DISCLOSURE

General
Advances and changes in technology can have a significant impact on our
business. Financial institutions are dependent on information systems and also
have many external interdependencies with other companies. Many computer
programs were designed to recognize calendar years by their last two digits.
Calculations performed using these digits may not work properly with dates
beginning in the Year 2000 and beyond. The Year 2000 issue creates risk for us
from unforeseen problems in our computer systems and from Year 2000 issues with
our vendors, service providers and customers.

Approach and Risks
We began to identify the risks associated with the Year 2000 in 1995. We
established a corporate oversight structure to ensure timely risk assessments,
remediation plans, systems testing, conversions, and centralized management of
the project. The structure of the effort entails a number of groups, each
addressing a different aspect of the project, and reporting to the Year 2000
program manager. Oversight of the entire project is performed by the Year 2000
advisory group. This is a management committee appointed by our board of
directors that reports to the board on a quarterly basis.

We determined that an enterprise-wide business risk-assessment approach was
most appropriate for addressing and remediating Year 2000 problems. This
included an assessment of the information technology resources of each of our
functional areas, as well as separate assessments of information technology
vendors and suppliers, mainframe applications, third party suppliers,
alternative platforms, and non-information technology and facilities risks.

In addition to systems-related risks, we undertook a review of risks created by
potential business interruptions suffered by our major business counterparties,
both domestic and foreign. We divided our business counterparties into three
broad categories: funds takers (primarily borrowers), funds providers
(depositors and other funding sources) and capital markets partners (trading
counterparties and fiduciary relationships). For those business partners that
would have a significant impact on our liquidity, income, or

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22
<PAGE>

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capital markets activities, should they encounter significant business
interruption due to the Year 2000, we have worked through the functional areas
involved to assess readiness and contingency plans for recovering from an
abrupt interruption.

After the assessment phase, Year 2000 efforts have focused on remediation and
verification. We have developed detailed action plans to address mainframe
systems, third party servicers, embedded technology and facilities and non-
information technology issues. For purchased systems and software and third
party servicers, the Year 2000 efforts have involved contacting the vendors or
suppliers and determining the Year 2000 status of the various systems and of
the plans to bring the systems into compliance. For in-house systems, the Year
2000 efforts include correction of the programs to ensure proper data
processing. Our action plans also include testing mission-critical systems to
verify the remediation efforts. We record and track information to remain aware
of the status of our information technology systems. The program manager is
working with our functional areas to develop contingency plans for a variety of
situations, such as the failure of a vendor to remediate Year 2000 issues by a
particular date or a system not being available for processing.

Inherent in the Year 2000, the failure to correct a material problem could
result in an interruption in or failure of certain business operations. Year
2000 risks and uncertainties include increased credit losses, service delays,
funding delays, counterparty failures, inaccurate information processing, ATM
failures, and problems with international accounts. There can be no assurance
that the Year 2000 issue will not have a material adverse impact on our
financial position, results of operations, or relationships with customers,
vendors, or others.

State of Readiness
While there is general uncertainty inherent in the Year 2000 problem, resulting
in part from the uncertainty of the readiness of third party vendors and
customers, our progress toward completing the enterprise-wide risk assessment
and remediating Year 2000 problems is on target. We completed remediation and
verification of all mission critical internal systems by December 31, 1998.
Mission-critical third party service providers completed their remediations by
December 31, 1998, and we substantially completed our verification of these
systems at March 31, 1999. This is in accordance with guidelines established by
bank regulatory authorities. Verification of non-mission critical system
changes, including non-information technology issues, will be performed
throughout 1999. We presently believe that the Year 2000 issue will not cause
significant operational problems.

Costs
The total cost to become Year 2000 compliant is not expected to be material to
our financial position. We estimate the total cost of the Year 2000 project
will be approximately $7.7 million, with funds provided from operating cash
flows. As of March 31, 1999, the total amount expended was $4.4 million, with
$759 thousand of this expense incurred in the first three months of 1999. The
future cost of completing the Year 2000 project is estimated to be $3.3
million. The most significant components of the total estimated cost consist of
65% for personnel costs, including consultants and special Year 2000
incentives, and 26% for data processing services. We do not separately track
all internal costs incurred for the Year 2000 project. Internal costs are
principally the payroll-related costs for the information systems group.

The Year 2000 expense represents approximately 10% of our total actual
information technology expenditures for the first three months of 1999. Other
significant or critical non-Year 2000 information technology efforts have not
been materially delayed or impacted by Year 2000 initiatives.

Contingency Plans
To prepare for the possibility that certain information systems or third party
vendors and servicers will not be Year 2000 compliant, we developed detailed
contingency plans. We have two types of contingency plans: remediation plans
and business resumption plans.

The remediation plans addressed those information systems we had determined
were not Year 2000 compliant through our testing. These plans described and
scheduled alternative provisions, including, if necessary, the replacement of
vendors or third party servicers to ensure compliance. The remediation plans
are complete; however, implementation of these plans is not expected to be
necessary because of our state of readiness.

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23
<PAGE>

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The business resumption plans address how we will continue operations in the
event a Year 2000 related interruption occurs. The business-resumption plans
for our mission-critical systems and mission-critical third-party servicers are
scheduled to be substantially complete by June 30, 1999. While implementation
of the business resumption plans is not expected to be necessary, it will
ensure we have the ability to process transactions and serve our customers
under circumstances where a Year 2000 problem actually occurs.

The discussion of our efforts and expectations related to Year 2000 compliance
are forward-looking statements which should be read in conjunction with the
discussion under "Risk Factors". Our ability to achieve Year 2000 compliance
and the associated costs could be adversely affected by, among other things,
the availability of programming and verification resources, vendors' ability to
modify proprietary software, and problems identified in the ongoing project
plan.

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24
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Supervision and Regulation

We and Riggs Bank are subject to the supervision of and regulation by the Board
of Governors of the Federal Reserve System, or the "Federal Reserve Board". Our
national banking subsidiaries and certain of their subsidiaries are subject to
the supervision of and regulation by the Office of the Comptroller of the
Currency, or the "OCC". Other federal, state and foreign laws govern many
aspects of our businesses and its subsidiaries.

Under the Bank Holding Company Act of 1956, bank holding companies may not
directly or indirectly acquire the ownership or control of five percent or more
of the voting shares or substantially all of the assets of any company,
including a bank, without the prior approval of the Federal Reserve Board. The
Bank Holding Company Act also restricts the types of businesses and activities
in which a bank holding company and its subsidiaries may engage. Generally,
activities are limited to banking and activities found by the Federal Reserve
Board to be so closely related to banking as to be a proper incident thereto.

We are required to maintain minimum levels of qualifying capital under Federal
Reserve Board risk-based capital guidelines. For a full discussion of these
guidelines, see "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and "Notes to Consolidated Financial Statements --
Note 10".

Under Federal Deposit Insurance Corporation regulations, the assessment rate
for an insured depository institution varies according to the level of risk
incurred in its activities. An institution's risk category is based partly upon
whether the institution is assigned to one of the following supervisory
subgroups: healthy; supervisory concern; or substantial supervisory concern.

The OCC must take prompt corrective action in respect of depository
institutions that do not meet minimum capital requirements. The OCC has
established levels at which an insured institution would be considered well
capitalized, adequately capitalized, undercapitalized, significantly
undercapitalized, and critically undercapitalized.

The following table details the minimum capital levels for each category:

<TABLE>
<CAPTION>
Combined Tangible
Tier 1 Tier 1 and 2 Leverage Equity
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Well capitalized............ 6% or above 10% or above 5% or above N/A
Adequately capitalized...... 4% or above 8% or above 4% or above N/A
Under capitalized........... Less than 4% Less than 8% Less than 4% N/A
Significantly
undercapitalized.......... Less than 3% Less than 6% Less than 3% N/A
Critically
undercapitalized.......... N/A N/A N/A 2% or less
</TABLE>

Beyond the minimum capital levels, well capitalized institutions may not be
subject to any order or written directive to meet and maintain a specific
capital level.

Riggs Bank exceeds current minimum regulatory capital requirements, and
qualifies as well capitalized. The applicable federal bank regulator for a
depository institution may, under certain circumstances, reclassify a well
capitalized institution as adequately capitalized or require an adequately
capitalized, or undercapitalized institution to comply with supervisory actions
as if it were in the next lower category. Such a reclassification may be made
if the regulatory agency determines that the institution is in an unsafe or
unsound condition (which could include unsatisfactory examination ratings). A
summary of applicable regulatory capital ratios and the minimums required by
the OCC under its capital guidelines for Riggs Bank, on a historical basis, is
shown in the "Notes to Consolidated Financial Statements -- Note 10".

A depository institution may not make any capital distribution (including
payment of a dividend) or pay any management fee to its holding company if the
depository institution would thereafter be undercapitalized. Undercapitalized
depository institutions are subject to increased regulatory monitoring and
growth limitations and are required to submit capital restoration plans.

The Reigle-Neal Interstate Banking and Branching Efficiency Act of 1994, or the
"Interstate Act", authorizes interstate acquisitions of banks and bank holding
companies without geographic limitation. In addition,

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25
<PAGE>

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beginning June 1, 1997, the Interstate Act authorized a bank to merge with a
bank in another state as long as neither of the states had opted out of
interstate branching between the date of enactment of the Interstate Act and
May 31, 1997. A bank may establish and operate a de novo branch in a state in
which the bank does not maintain a branch if that state expressly permits de
novo branching. Once a bank has established branches in a state through an
interstate merger transaction, the bank may establish and acquire additional
branches at any location in the state where any bank involved in the interstate
merger transaction could have established or acquired branches under applicable
federal or state law. A bank that has established a branch in a state through
de novo branching may establish and acquire additional branches in such state
in the same manner and to the same extent as a bank having a branch in such
state as a result of an interstate merger. If a state opts out of interstate
branching within the specified time period, no bank in any other state may
establish a branch in the opting out state, whether through an acquisition or
de novo.

Effective June 1995, coinciding with the mandatory 1.25% funding of the Bank
Insurance Fund reserve, insurance rates were reduced from a range of $.23 to
$.26 per $100 in deposits insured to a range of $.04 to $.07 per $100 in
deposits insured. Further, in November 1995, based on the continuing increase
in reserves with the Bank Insurance Fund, or the BIF, the Federal Deposit
Insurance Corporation, or the FDIC, announced an additional reduction of
insurance rates to zero percent; however, banks must pay a mandatory minimum of
$2 thousand per year.

On September 30, 1996, Congress passed and the President signed an omnibus
funding bill which included legislation for the recapitalization of the Savings
Association Insurance Fund, or the "SAIF", which is administered by the FDIC.
This legislation includes a provision requiring the merger of the BIF, which is
also administered by the FDIC, and the SAIF in 1999, assuming that bank
charters and thrift charters are combined by that time. The legislation
provided for a new Financing Corporation, or "FICO", sharing formula between
BIF and SAIF-insured institutions, which imposes a surcharge of 1.3 cents per
one hundred dollars of BIF-insured deposits. The Corporation is subject to the
FICO surcharge and is required to pay one-fifth of the rate that SAIF
institutions pay for three years, ending in 1999.

There are legal restrictions on the extent to which we and our non-bank
subsidiaries may borrow or otherwise obtain credit from Riggs Bank. Subject to
certain limited exceptions, a bank subsidiary may not extend credit to us or to
any other affiliate (as defined) in an amount which exceeds 10% of its capital
stock and surplus and may not extend credit in the aggregate to such affiliates
in an amount which exceeds 20% of its capital stock and surplus. Further, there
are legal requirements as to the type, amount and quality of collateral which
must secure such extensions of credit by each bank subsidiary to us or to other
affiliates. Finally, extensions of credit and other transactions between a bank
subsidiary and us or other affiliates must be on terms and under circumstances,
including credit standards, that are substantially the same or at least as
favorable to such a bank subsidiary as those prevailing at the time for
comparable transactions with non-affiliated companies.

Under Federal Reserve Board policy, bank holding companies are expected to act
as a source of financial strength to their subsidiary banks and to commit
resources to support such banks in circumstances where a bank holding company
might not do so absent such policy. In addition, any capital loans by a bank
holding company to any of its subsidiary banks are subordinate in right of
payment to deposits and to certain other indebtedness of such subsidiary bank.
In the event of a bank holding company's bankruptcy, any commitment by the bank
holding company to a federal bank regulatory agency to maintain the capital of
a subsidiary bank will be assumed by the bankruptcy trustee and entitled to a
priority of payment.

Our subsidiaries face substantial competition in their operations from banking
and nonbanking institutions, including savings and loan associations, credit
unions, money market funds and other investment vehicles, mutual fund advisory
companies, brokerage firms, insurance companies, mortgage banking companies,
finance companies and other types of financial services providers.

The National Bank Act limits dividends payable by national banks without
approval of the OCC to net profits retained in the current and preceding two
calendar years, plus additional amounts for dividends in excess of a given
year's earnings. The payment of dividends by our national bank subsidiaries may
also be affected by other factors, such as requirements for the maintenance of
adequate capital.

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Accounting Treatment

The trust preferred securities will be represented in a separate line item in
our consolidated statements of condition. The separate line item is entitled
"Guaranteed Preferred Beneficial Interests in Junior Subordinated Deferrable
Interest Debentures". Appropriate disclosures about the trust preferred
securities, the guarantee and the junior debentures will be included in the
notes to our consolidated financial statements. For financial reporting
purposes, we will record distributions payable on the trust preferred
securities in our consolidated statements of income as a deduction from income
before taxes as minority interest in income of subsidiaries, net of taxes.

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Description Of Trust Preferred Securities

This section summarizes the material provisions of the trust preferred
securities and the amended trust agreement governing the trust. The amended
trust agreement and its associated documents, including the trust preferred
securities themselves, contain the full legal text of the matters described in
this section. We have filed with the SEC a form of the amended trust agreement
as an exhibit to our registration statement. See "Where You Can Find More
Information" on page 60 for information on how to obtain a copy.

The amended trust agreement, the trust preferred securities and the common
securities are governed by Delaware law.

ISSUANCE AND GENERAL CHARACTERISTICS

The trust will issue the trust preferred securities and the common securities,
with a liquidation amount of $1,000 per security. The trust preferred
securities and the common securities will rank equally with one another, and
the trust will make all payments on the trust preferred securities
proportionately with the common securities, except under certain cases of
default under the amended trust agreement.

The trust will use the proceeds from the sale of the trust preferred securities
and the common securities to purchase the junior debentures from us. We will
issue the junior debentures under an indenture between us and The Bank of New
York as further described in "Description of Junior Debentures -- Issuance and
General Characteristics". The Bank of New York will also act as property
trustee and will hold legal title to the junior debentures in trust for the
benefit of the holders of the trust preferred securities and common securities.
We will guarantee, on a subordinated basis, the payment of distributions and
other amounts payable on the trust preferred securities, but only to the extent
that the trust has funds available on hand to make those payments. For further
information on our guarantee, see "Description of the Guarantee and the Expense
Agreement".

The amended trust agreement will be qualified as an indenture under the Trust
Indenture Act. The property trustee will act as indenture trustee for the trust
preferred securities, in order to comply with the provisions of the Trust
Indenture Act.

The trust preferred securities will be represented by a global security that
will be deposited with and registered in the name of The Depository Trust
Company or its nominee. Whenever we refer to a holder of trust preferred
securities in this prospectus, we mean the registered holder, which, for any
trust preferred securities in book-entry form, will be DTC or its nominee. We
discuss matters relevant to global securities under the caption "Book-Entry
Issuance".

DISTRIBUTIONS

Distributions will accumulate on the trust preferred securities from their
original issue date, at the variable annual rate of LIBOR plus .% of their
liquidation amount, adjusted quarterly. Unless deferred as described below,
distributions will be payable quarterly in arrears on ., ., ., and . of each
year to the holders of the trust preferred securities at the close of business
on the 15th day -- whether or not a business day -- next preceding the relevant
distribution date. The first distribution date will be ., 1999. The amount of
distributions payable for any period will be computed on the basis of a 360-day
year of twelve 30-day months.

The trust will have no funds to distribute in respect of the trust preferred
securities other than the payments it receives from us on the junior
debentures. Consequently, if we defer or for any other reason fail to make
interest payments on the junior debentures, the trust will not have funds
available to pay distributions on the trust preferred securities. We have no
current intention to exercise our right to defer interest payments on the
junior debentures.

Deferral periods. As long as no event of default under the indenture, as
described under "Description of Junior Debentures -- Indenture Events of
Default", has occurred and is continuing, we have the right under the indenture
to defer the payment of interest on the junior debentures at any time and in
each case for a period not exceeding 20 consecutive quarterly periods. No
deferral period may extend beyond the stated

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maturity of the junior debentures. Before a deferral period ends, we may extend
it further, subject to the limit described above. When a deferral period ends
and we have paid all interest then accrued and unpaid on the junior debentures,
we may begin a new deferral period, so long as no event of default under the
indenture has occurred and is continuing. There is no limit on the number of
deferral periods that we may begin.

If we elect to defer interest payments on the junior debentures, the trust will
defer the payment of distributions on the trust preferred securities during the
same deferral period. However, during a deferral period, distributions will
continue to accumulate on the trust preferred securities and additional
distributions will accumulate on each deferred distribution payment at .%,
compounded quarterly from the corresponding distribution date. The term
distribution, wherever we use it in this prospectus, includes any of these
additional distributions. During a deferral period, holders of trust preferred
securities will continue to be required to accrue interest income for U.S.
federal income tax purposes. For further information on tax consequences, see
"U.S. Federal Income Tax Considerations -- Original Issue Discount".

Any distributions that would otherwise become due and payable during a deferral
period will not become due and payable until the day after the period ends. If
any trust preferred securities become subject to redemption during a deferral
period, that period will end automatically on the day before the redemption
date.

We must give the property trustee and the holders of trust preferred securities
notice of our election to begin or extend a deferral period. In general, each
notice must be given at least one business day before the record date for the
distribution date on which distributions would have been payable if we had not
elected to defer payment. We must notify the holders in the manner described
below in " -- Notices".

Deferral period restrictions. The indenture provides that, during any deferral
period, neither we nor any of our subsidiaries may take any of the following
actions:

. declare or pay any dividend or other distribution on, or redeem, purchase or
otherwise acquire or make a liquidation payment on any of our capital stock;

. pay any principal, interest or other amount in respect of, or repay, redeem,
purchase or otherwise acquire, any of our debt securities that rank equally
with or junior to the junior debentures; or

. make a guarantee payment with respect to our guarantees of our subsidiaries'
securities that rank equally in all respects or junior to the junior
debentures.

The indenture restriction described above provides for significant exceptions.
Any of the following that would otherwise be covered by this restriction will
nevertheless be permitted:

. the payment of any dividend or distribution with our own common stock;

. any declaration or payment of a dividend in connection with any stockholder
rights plan;

. any payment under the guarantee of the trust preferred securities; or

. purchases of our common stock in connection with issuing our common stock or
rights under any of our benefit plans or other similar arrangements for our
directors, officers or for our employees.

REDEMPTION

The trust preferred securities will remain outstanding until the trust redeems
them or distributes the junior debentures in exchange for the trust preferred
securities. Any redemption of trust preferred securities must occur as
described below.

Redemption of trust preferred securities. If we repay or redeem the junior
debentures at any time, the trust will be obligated to redeem an equivalent
amount of trust preferred securities and common securities. The redemption of
the trust preferred securities will occur on the redemption date, which means
the date on which payment of the principal of those junior debentures becomes
due under the indenture. The redemption

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price for the trust preferred securities will be the total liquidation amount
of the trust preferred securities being redeemed plus accumulated but unpaid
distributions up to but excluding the redemption date.

Repayment and redemption of junior debentures. We may redeem the junior
debentures before their stated maturity as follows:

(1) in whole at any time or in part from time to time on or after July ., 2004,
provided that no partial redemption may occur during a deferral period; or

(2) in whole at any time within 90 days after the occurrence of a tax event or
a capital treatment event, each as defined below.

If we elect to redeem the junior debentures, we will do so at a redemption
price of 100% of the principal amount of the junior debentures being redeemed,
plus accrued and unpaid interest.

Definition of capital treatment event. The term capital treatment event means
the reasonable determination by us that as a result of:

. any amendment to or change, including any announced prospective change, in
the laws, or any rules or regulations under the laws, of the United States or
of any political subdivision of or in the United States, if the amendment or
change is effective on or after the date the trust preferred securities are
issued;

. any official or administrative pronouncement or action or any judicial
decision interpreting or applying such laws or regulations, if the
pronouncement, action or decision is announced on or after the date the trust
preferred securities are issued; or

. there is more than an insubstantial risk that we will not be entitled to
treat the liquidation amount of the trust preferred securities as Tier 1
capital for purposes of the applicable Federal Reserve capital adequacy
guidelines as then in effect.

Definition of tax event. The term tax event means the receipt by us and the
trust of an opinion of independent counsel, experienced in tax matters, to the
following effect:

As a result of any tax change, there is more than an insubstantial risk that
any of the following will occur:

(1) the trust is, or will be within 90 days after the date of the opinion of
counsel, subject to U.S. federal income tax on income received or accrued
on the junior debentures;

(2) interest payable by us on the junior debentures is not, or within 90 days
after the opinion of counsel will not be, deductible by us, in whole or in
part, for U.S. federal income tax purposes; or

(3) the trust is, or will be within 90 days after the date of the opinion of
counsel, subject to more than a de minimis amount of other taxes, duties or
other governmental charges.

As used above, the term tax change means any of the following:

. any amendment to or change, including any announced prospective change, in
the laws or any regulations under the laws of the United States or of any
political subdivision or taxing authority of or in the United States, if the
amendment or change is enacted, promulgated or announced on or after the date
the trust preferred securities are issue; or

. any official administrative pronouncement, including any private letter
ruling, technical advice memorandum, field service advice, regulatory
procedure, notice or announcement, including any notice or announcement of
intent to adopt any procedures or regulations, or any judicial decision
interpreting or applying such laws or regulations, whether or not the
pronouncement or decision is issued to or in connection with a proceeding
involving us or the trust or is subject to review or appeal, if the
pronouncement or decision is enacted, promulgated or announced on or after
the date of the issuance of the trust preferred securities.

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Payment of additional amounts. The indenture provides that, if a tax event
described in items (1) and (3) of the definition of tax event above has
occurred and is continuing and we do not redeem the junior debentures, we may
be required to pay additional sums on the junior debentures. These additional
sums would be those amounts necessary to ensure that distributions due and
payable on the trust preferred securities and common securities will not be
reduced as a result of any additional taxes, duties and other governmental
charges to which the trust has become subject as a result of a tax event.

Redemption procedures. The property trustee will give notice of any redemption
of trust preferred securities to the holders of trust preferred securities not
less than 30 nor more than 60 days before the redemption date, unless the
redemption results from acceleration of the maturity of the junior debentures
and the property trustee cannot reasonably give this notice during this period.
In that case, the property trustee will give the notice as soon as practicable.
In all cases, the property trustee will give the notice of redemption in the
manner described under " -- Notices".

Payment of the redemption price for any trust preferred securities will be made
against surrender of the certificates representing those trust preferred
securities, or, in the case of any trust preferred securities held in book-
entry form, in accordance with the applicable procedures of DTC. However, any
distributions that are payable on or before the redemption date will be payable
to the persons who are the holders of those trust preferred securities on the
record date for the distribution.

If the property trustee gives a notice of redemption, the property trustee will
deposit funds sufficient to pay the redemption price for all trust preferred
securities to be redeemed on that date to the extent the funds are available to
the property trustee. The property trustee, in the case of book-entry trust
preferred securities, or the paying agent, in the case of non-book-entry trust
preferred securities, will irrevocably deposit these amounts with DTC by noon,
New York City time, on the redemption date. If the property trustee gives
notice of redemption and deposits funds as required under the amended trust
agreement, then upon the date of deposit all rights of the holders of the trust
preferred securities called for redemption will cease, except the right of
those holders to receive the redemption price, without interest, and those
trust preferred securities will cease to be outstanding. If payment of the
redemption price for any trust preferred securities called for redemption is
improperly withheld or refused and not paid either by the trust or by us under
the guarantee, or if notice of redemption is not given as required,
distributions on those trust preferred securities will continue to accumulate
from the original redemption date to the date the redemption price is actually
paid.

If the trust redeems less than all the trust preferred securities and common
securities, the aggregate liquidation amount of trust preferred securities and
common securities to be redeemed will be allocated proportionately between the
outstanding trust preferred securities and the outstanding common securities,
based upon their respective aggregate liquidation amounts. Not more than 60
days prior to the redemption date, the property trustee will select the trust
preferred securities to be redeemed from among the outstanding trust preferred
securities not previously called for redemption. The property trustee may use
any method of selection that it deems to be fair and appropriate, including any
method that involves the redemption of a portion of the aggregate liquidation
amount of any particular holder's trust preferred securities.

Other purchases of trust preferred securities. Subject to applicable law, we
may, and our subsidiaries may, purchase outstanding trust preferred securities
by tender, in the open market or by private agreement. These purchases may
occur at any time and from time to time.

EXCHANGE OF TRUST PREFERRED SECURITIES FOR JUNIOR DEBENTURES

As the holders of the common securities, we may dissolve the trust at any time
in our sole discretion subject to the prior approval of the Federal Reserve, if
required at the time. Upon such an election, the property trustee will
liquidate the trust and satisfy liabilities to creditors, if any. The property
trustee will then distribute to the holders of the outstanding trust preferred
securities and common securities, an equivalent amount of junior debentures in
exchange for those securities. In this context, an equivalent amount means
junior debentures having an aggregate principal amount equal to the aggregate
liquidation amount of all outstanding trust preferred securities and common
securities.

If an exchange distribution occurs, we will use our best efforts to include the
junior debentures on any stock exchanges or other automated quotation systems
on which the trust preferred securities are then listed or traded.

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Exchange Procedures. The property trustee will notify holders of trust
preferred securities of any exchange not less than 30 nor more than 60 days
before the exchange date, in the manner described below under " -- Notices".
On the exchange date, the following will occur:

. the trust preferred securities will cease to be outstanding;

. DTC or its nominee will receive certificates representing the junior
debentures to be distributed in exchange for all trust preferred securities
held in book-entry form, with those junior debentures also being in book-
entry form;

. any certificates representing trust preferred securities in non-book-entry
form will be deemed to represent an equal amount of junior debentures,
bearing accrued and unpaid interest in an amount equal to the accumulated and
unpaid distributions on those trust preferred securities, until those
certificates are presented to the paying agent for exchange or transfer; and

. all rights of the holders of trust preferred securities will cease, except
for the right of holders of trust preferred securities in non-book-entry form
to receive certificates representing junior debentures in non- book-entry
form upon surrender of the certificates representing their trust preferred
securities.

LIQUIDATION DISTRIBUTION UPON TERMINATION

Under the amended trust agreement, the trust will automatically dissolve upon
the occurrence of any of the following events:

. the expiration of its term of approximately 31 years;

. certain events of bankruptcy, dissolution or liquidation of Riggs National
Corporation;

. distribution of the junior debentures in exchange for the trust preferred
securities and common securities, upon our election to dissolve the trust, as
described above under " -- Exchange of Trust Preferred Securities for Junior
Debentures";

. redemption of all the trust preferred securities; or

. the entry of an order for the dissolution of the trust by a court of
competent jurisdiction.

If the trust dissolves while the trust preferred securities are outstanding,
the property trustee will liquidate the trust as expeditiously as the property
trustee determines to be possible. After the property trustee satisfies
liabilities of the trust's creditors, it will distribute to the holders of the
outstanding trust preferred securities and the common securities, an equal
amount of the junior debentures.

If the property trustee determines that an exchange distribution is not
practical, each holder of outstanding trust preferred securities will be
entitled to receive out of the available assets of the trust, after
satisfaction of liabilities to creditors of the trust, an amount equal to the
liquidation distribution. The liquidation distribution for any trust preferred
securities will equal the aggregate liquidation amount of those trust preferred
securities plus all accrued and unpaid distributions on them to the date of
payment. If the liquidation distribution for all outstanding trust preferred
securities can be paid only in part because the trust has insufficient assets
available to pay it in full, the amounts payable by the trust on the trust
preferred securities will be paid proportionately, based on their respective
liquidation distributions.

On any liquidation of the trust, the holders of the common securities will be
entitled to receive distributions proportionately with the holders of the trust
preferred securities, unless an event of default under the amended trust
agreement, which we will refer to as a trust event of default, has occurred and
is continuing. In that case, the trust preferred securities will have priority
in right of payment over the common securities, as described below under " --
Priority Over Common Securities".

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PRIORITY OVER COMMON SECURITIES

Payment of distributions and the redemption price will be made on the trust
preferred securities and the common securities proportionately, based on the
respective aggregate liquidation amounts of the two classes, except as follows.
If a trust event of default has occurred and is continuing, the trust will not
pay any distribution or redemption price, or make any liquidation distribution,
on the common securities on any day unless the following have occurred:

. in the case of any distribution to be paid, all accumulated and unpaid
distributions on all outstanding trust preferred securities for all
distribution periods ending on or before the payment day have been paid or
duly provided for in cash;

. in the case of any redemption price to be paid, the redemption price on all
outstanding trust preferred securities called on or before the payment day
for redemption has been paid or duly provided for in cash; and

. in the case of a liquidation distribution to be made, the liquidation
distribution on all outstanding trust preferred securities has been made or
duly provided for.

Accordingly, if a trust event of default has occurred and is continuing,
whenever a distribution or redemption price is due and payable in respect of
the trust preferred securities, the property trustee will apply all available
funds to the payment of those amounts in full in cash before making any payment
in respect of the common securities.

The trust will not make any payment or other distribution in respect of the
common securities, including on account of any purchase or other acquisition,
while the trust preferred securities are outstanding, other than distributions,
the redemption price and the liquidation distribution on the terms set forth in
the amended trust agreement.

If a trust event of default occurs as a result of an indenture event of
default, the holders of the common securities will be treated as having waived
all rights to act with respect to the trust event of default until all trust
events of default have been cured, waived or otherwise eliminated. Until that
time, the property trustee will act solely on behalf of the holders of the
trust preferred securities and not on behalf of the holders of the common
securities, and only the holders of the trust preferred securities will have
the right to direct the property trustee to act on their behalf.

TRUST EVENTS OF DEFAULT

Any one of the following events will be a trust event of default under the
amended trust agreement:

. the occurrence of an indenture event of default under the indenture, see
"Description of Junior Debentures -- Indenture Events of Default";

. default by the trust in the payment of any distribution when it becomes due
and payable and continuation of the default for 30 days;

. default by the trust in the payment of any redemption price when it becomes
due and payable;

. material default or breach under any covenant or warranty of the property
trustee or Delaware trustee under the amended trust agreement, and
continuation of the default or breach for 60 days after a notice of default
has been given; a notice of default may be given only by the holders of at
least 25% of the outstanding trust preferred securities, as provided under
the amended trust agreement; and

. the occurrence of certain events of bankruptcy or insolvency with respect to
the property trustee if a successor property trustee has not been appointed
within 90 days.

Within five business days after learning about a trust event of default, the
property trustee will notify the administrative trustees and the holders of the
outstanding trust preferred securities and common securities, unless the trust
event of default has been cured or waived.

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We, as depositor, and the administrative trustees are obligated to file
annually with the property trustee a certificate as to whether or not we are in
compliance with all the conditions and covenants applicable to us under the
amended trust agreement.

ENFORCEMENT RIGHTS

If an indenture event of default occurs, the holders of trust preferred
securities must rely on the property trustee, as the holder of the junior
debentures, to enforce their rights under the junior debentures and the
indenture against us, subject to the following.

Right to direct property trustee's actions. The holders of a majority of
outstanding trust preferred securities will have the right to direct the time,
method and place of conducting any proceeding for any remedy available to, or
exercising any trust or power conferred on, the property trustee under the
amended trust agreement. This includes the right to direct the property trustee
to exercise the remedies available to it as the holder of the junior
debentures. Accordingly, the property trustee will not take any of the
following actions without obtaining the prior approval of the holders of a
majority of the outstanding trust preferred securities, or, in the case of any
action that under the indenture may be taken only with the prior consent of
each affected holder of junior debentures, without the prior consent of each
holder of outstanding trust preferred securities:

. direct the time, method or place of conducting any proceeding for any remedy
available to, or executing any trust or power conferred on, the indenture
trustee with respect to the junior debentures;

. waive any past default that may be waived under the indenture;

. exercise any right to rescind or annul a declaration that the principal of
all the junior debentures be due and payable;

. consent to any amendment, modification or termination of the indenture or the
junior debentures, if the consent of any holder of junior debentures is
required under the indenture; or

. revoke any action previously authorized or approved by the holders of the
trust preferred securities except by or with the subsequent authorization or
approval of the holders of the trust preferred securities.

Before taking any of the actions described above, the property trustee must
also obtain, at our expense, an opinion of counsel, experienced in the
following matters, to the effect that the action will not cause the trust to be
classified as an association taxable as a corporation, or as other than a
grantor trust, for U.S. federal income tax purposes. The property trustee will
notify the holders of trust preferred securities of any notice of default with
respect to the junior debentures, in the manner described below under " --
Notices".

Any required approval of holders of trust preferred securities may be given by
written consent or at a meeting convened for that purpose. The property trustee
must cause a notice to be given to the holders of trust preferred securities of
any matter upon which holders of trust preferred securities are to act by
written consent, or of any meeting at which holders of trust preferred
securities are entitled to vote, in the manner described below under " --
Notices".

Right of direct action. If an indenture event of default has occurred and is
continuing and is attributable to our failure to pay any interest or principal
on the junior debentures when due and payable, a holder of trust preferred
securities may begin a legal proceeding directly against us for enforcement of
payment to that holder of the interest or principal due and payable on an equal
amount of junior debentures. We may not amend the indenture to remove the right
of any holder of outstanding trust preferred securities to bring a direct
action without the prior written consent of that holder.

We will have the right under the indenture to set off any payment made to a
holder of trust preferred securities in connection with a direct action. Except
for the right to bring a direct action, holders of trust preferred securities
will not have the right to exercise directly against us any remedy available to
a holder of junior debentures.

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Right to accelerate junior debentures. If the holders of junior debentures do
not exercise their rights under the indenture to:

. accelerate the maturity of the junior debentures when an indenture event of
default has occurred and is continuing;

. annul a declaration of acceleration of the junior debentures; and

. waive certain defaults under the indenture;

then the holders of certain minimum percentages of the outstanding trust
preferred securities will be entitled to exercise these specified rights. See
"Description of Junior Debentures -- Indenture Events of Default".

MERGERS, CONSOLIDATIONS, AMALGAMATIONS AND REPLACEMENTS OF THE TRUST

At our request and with the consent of the holders of a majority of the trust
preferred securities, the trust may merge with or into, or consolidate or
amalgamate with, or be replaced by, or convey, transfer or lease its properties
and assets substantially as an entirety to, another entity. Each of these
mentioned transactions, referred to as trust successor transactions, may be
consummated only if the other entity is organized as a trust under the laws of
any state in the United States and only if all the following requirements are
met:

. the successor entity, if not the trust, either (1) expressly assumes all the
obligations of the trust with respect to the trust preferred securities or
(2) substitutes for the trust preferred securities other securities having
substantially the same terms as the trust preferred securities, referred to
as successor securities, provided that these successor securities rank at
least as high as the trust preferred securities rank with regard to the
priority in right of payment of all distributions and other amounts payable
upon liquidation, redemption and otherwise;

. the successor entity, if not the trust, has a purpose identical to that of
the trust;

. a trustee of the successor entity, if not the trust, possessing the same
powers and duties as the property trustee is appointed to hold the junior
debentures;

. the trust successor transaction does not cause the trust preferred
securities, or any successor securities, to be downgraded by any nationally
recognized statistical rating organization that assigns ratings to the trust
preferred securities;

. the trust successor transaction does not adversely affect the rights,
preferences and privileges of the holders of the trust preferred securities,
or any successor securities, in any material respect;

. prior to the trust successor transaction, we and the trust have received an
opinion from our independent counsel, experienced in the following matters,
to the effect that (1) the trust successor transaction will not adversely
affect the rights, preferences and privileges of the holders of the trust
preferred securities, or any successor securities, in any material respect
and (2) upon completion of the trust successor transaction, the trust or the
successor entity, as applicable, will not be required to register as an
investment company under the Investment Company Act of 1940; and

. we, or any permitted successor, together with our permitted assignees, hold
all the common securities of the trust or all comparable securities of the
successor entity, as applicable, and guarantee the obligations of the
successor entity, if not the trust, in respect of the trust preferred
securities, or any successor securities, at least to the extent provided by
the guarantee.

Despite the foregoing, the trust may not engage in a trust successor
transaction that would cause the trust or the successor entity, as applicable,
to be classified as an association taxable as a corporation or as other than a
grantor trust for U.S. federal income tax purposes, unless it first obtains the
consent of all holders of outstanding trust preferred securities.

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AMENDMENT OF THE TRUST AGREEMENT

We and the property trustee, without the consent of the holders of the trust
preferred securities, may amend the amended trust agreement from time to time
to:

. cure any ambiguity, or correct or supplement any provision that may be
inconsistent with any other provision, in the amended trust agreement;

. make any provision with respect to matters or questions arising under the
amended trust agreement that is consistent with the other provisions of the
amended trust agreement; and

. modify, eliminate or add to any provisions of the amended trust agreement to
any extent that may be necessary to ensure that the trust will not be taxable
as a corporation or be classified as other than a grantor trust, or to ensure
that the junior debentures are treated as our indebtedness, for U.S. federal
income tax purposes, or to ensure that the trust will not be required to
register as an investment company under the Investment Company Act;

but only if the amendment does not adversely affect the interests of any holder
of trust preferred securities in any material respect and does not become
effective until notice of the amendment is given to the holders of trust
preferred securities.

We and the property trustee may also amend the amended trust agreement if all
of the following requirements are met:

. we obtain the consent of the holders of not less than a majority of the
outstanding trust preferred securities; and

. the property trustee and Delaware trustee receive an opinion of counsel to
the effect that the amendment or the exercise of any power granted to them in
accordance with the amendment will not result in the trust being taxable as a
corporation or being classified as other than a grantor trust, or the junior
debentures being treated as other than our indebtedness, for U.S. federal
income tax purposes or being required to register as an investment company
under the Investment Company Act.

An amendment of the amended trust agreement that does any of the following can
take effect only if each holder of trust preferred securities consents to the
amendment:

. changes the amount or timing of any distribution or other payment, or
otherwise adversely affects the amount of any distribution or other payment
required to be made as of a specified date, in respect of that holder's trust
preferred securities; or

. restricts the right of that holder to institute suit for the enforcement of
any payment on those trust preferred securities on or after the date on which
it becomes due and payable.

For the purpose of any vote or consent of holders of trust preferred
securities, any trust preferred securities owned by us, the property trustee,
the Delaware trustee or any affiliate of the foregoing will be treated as if
they were not outstanding.

VOTING RIGHTS

The holders of the trust preferred securities will have no voting rights except
as provided under " -- Enforcement Rights", " -- Amendment of the Trust
Agreement", "Description of the Guarantee and the Expense Agreement --
Amendments, Assignment and Succession", and as otherwise required by law and
the amended trust agreement.

NOTICES

Notices to be given to holders of trust preferred securities held in book-entry
form will be given only to DTC in accordance with its applicable procedures.
Notices to be given to holders of trust preferred securities held

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in non-book-entry form may be given by mail to the addresses of the holders as
they appear in the security register and will be deemed duly given when mailed
to those addresses. Neither the failure to give any notice to a particular
holder, nor any defect in a notice given to a particular holder, will affect
the sufficiency of any notice given to another holder.

PAYMENT AND PAYING AGENCY

Payments in respect of any trust preferred securities held in book-entry form
will be made only to DTC or its nominee in accordance with DTC's applicable
procedures. Payments in respect of any trust preferred securities not held in
book-entry form will be made at the offices of any paying agent. However, at
our option, distributions payable on non-book-entry trust preferred securities
may be paid by check mailed to the persons entitled to receive them, at their
addresses appearing on the security register on the relevant record date.

The property trustee will initially serve as the paying agent. From time to
time, the property trustee may select one or more firms to act as the paying
agent or as co-paying agents. Each paying agent must be a bank or trust company
acceptable to the administrative trustees. A paying agent will be permitted to
resign as paying agent upon 30 days' written notice to the property trustee and
us. In the event there is no paying agent, the property trustee will appoint a
firm to act as paying agent.

If any distribution, redemption price or other amount is payable in respect of
the trust preferred securities on a day that is not a business day, the payment
may be made on the next succeeding business day unless that business day is in
a different calendar year, in which case the payment may be made on the next
preceding business day.

The owners of beneficial interests in trust preferred securities held in book-
entry form will not have any rights under the amended trust agreement or the
indenture to receive payments in respect of those trust preferred securities.
Those beneficial owners will have only the rights that may exist under the
applicable procedures of DTC and its direct and indirect participants. For a
description of matters relating to securities held in book-entry form, see
"Book-Entry Issuance".

Any moneys deposited with the property trustee or any paying agent, or then
held in trust by us or the trust, for the payment of any amount due and payable
on any trust preferred securities, and remaining unclaimed for two years after
the amount has become due and payable, will, at our request, be repaid to us.
Thereafter, the holders of those trust preferred securities will look, as a
general unsecured creditor, only to us for payment thereof.

REGISTRAR AND TRANSFER AGENT

The property trustee will act as registrar and transfer agent for the trust
preferred securities. The property trustee will exchange and register transfers
of trust preferred securities without charge by or on behalf of the trust, but
will require payment of any tax or other governmental charge that may be
imposed in connection with the exchange or transfer. If any trust preferred
securities have been called for redemption, the property trustee may refuse to
register any transfer of those trust preferred securities.

THE TRUSTEES OF THE TRUST

Removal, appointment and successors. The holders of at least a majority of the
outstanding trust preferred securities may remove either the property trustee
or the Delaware trustee for cause or, if an indenture event of default has
occurred and is continuing, with or without cause. If one of these trustees is
removed by the holders of the outstanding trust preferred securities, the
successor may be appointed by the holders of at least 25% of the outstanding
trust preferred securities. If one of these trustees resigns, it will appoint
its successor. If the trustee fails to appoint a successor, the holders of at
least 25% of the outstanding trust preferred securities may appoint a
successor. If a successor has not been appointed by the holders, any holder of
trust preferred securities or common securities, or the other trustee, may
petition a court in the State of Delaware to appoint a successor. As long as no
indenture event of default has occurred and is continuing, we, as the holder of
the common securities, have the right to remove the property trustee and the
Delaware trustee at any time.

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Any Delaware trustee must meet the applicable requirements of Delaware law. Any
property trustee must be a national or state-chartered bank and, at the time of
appointment, must have securities rated in one of the three highest rating
categories by a nationally recognized statistical rating organization and have
capital and surplus of at least $50,000,000. No resignation or removal of a
trustee, and no appointment of a successor trustee, will be effective until the
acceptance of appointment by the successor trustee in accordance with the
provisions of the amended trust agreement.

In no event will the holders of the trust preferred securities have the right
to vote to appoint, remove or replace the administrative trustees. We have this
exclusive right as the holder of the common securities.

Co-trustees and separate property trustee. As long as no event of default has
occurred and is continuing, we, as the holder of the common securities, and the
administrative trustees may at any time appoint a co-trustee or a separate
property trustee in order to meet the legal requirement of the Trust Indenture
Act or of any other jurisdiction where any part of the trust property may be
located. We will vest the co-trustee, which will act jointly with the property
trustee, or the separate trustee with any property, title, right or power
sufficient to enable it to comply with the legal requirements of the Trust
Indenture Act or of any other jurisdiction.

If an indenture event of default has occurred and is continuing, the property
trustee will have the sole authority to appoint a co-trustee or a separate
trustee.

Merger, consolidation, etc. If the property trustee or the Delaware trustee
merges, consolidates with or converts into, another entity, or another entity
succeeds to all or substantially all the corporate trust business of that
trustee, that other entity will be the successor of that trustee under the
amended trust agreement, but only if that other entity is qualified and
eligible to be a trustee.

Duties of property trustee. The property trustee undertakes to perform only
those duties that are specifically set forth in the amended trust agreement.
If, however, a trust event of default is continuing, the property trustee must
exercise the same degree of care and skill as a prudent person would exercise
or use in the conduct of his or her own affairs. Subject to this provision, the
property trustee will have no obligation to exercise any of the powers vested
in it by the amended trust agreement at the request of any holder of trust
preferred securities unless it is offered reasonable indemnity against the
costs, expenses and liabilities that it might incur as a result.

If no trust event of default is continuing and the property trustee must decide
between alternative causes of action or construe ambiguous provisions in the
amended trust agreement, or is unsure of the application of any provision of
the amended trust agreement, and the matter is not one on which the holders of
trust preferred securities and common securities are entitled under the amended
trust agreement to vote, then the property trustee may take any action that it
deems to be advisable and in the best interests of the holders of the trust
preferred securities and common securities and will have no liability except
for its own bad faith, negligence or willful misconduct.

Conducting the affairs and operations of the trust. The amended trust agreement
authorizes and directs the administrative trustees and the property trustee to
conduct the affairs of and to operate the trust so that the trust will not be
required to register as an investment company under the Investment Company Act
or be classified as an association taxable as a corporation or as other than a
grantor trust for U.S. federal income tax purposes and so that the junior
debentures will be treated as our indebtedness for U.S. federal income tax
purposes. The amended trust agreement authorizes the property trustee and the
holders of common securities to take any action, not inconsistent with
applicable law, the certificate of trust of the trust or the amended trust
agreement, that they, or any successor entity, determine in their discretion to
be necessary or desirable for these purposes, as long as the action does not
adversely affect the interests of the holders of the trust preferred securities
in any material respect.

NO PREEMPTIVE RIGHTS

Holders of the trust preferred securities will have no preemptive or similar
rights.

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Description Of Junior Debentures

This section summarizes the material provisions of the junior debentures and a
document called the indenture, which governs the junior debentures. The
indenture is a contract between us and The Bank of New York, who acts as
indenture trustee. The indenture and its associated documents, including the
junior debentures, contain the full legal text of the matters described in this
section. A copy of the indenture has been filed with the SEC as part of our
registration statement. See "Where You Can Find More Information" on page 60
for information on how to obtain a copy.

The indenture and the junior debentures are governed by New York law.

ISSUANCE AND GENERAL CHARACTERISTICS

We will issue the junior debentures under the indenture concurrently with the
issuance of the trust preferred securities. The trust will use the proceeds
from the sale of the trust preferred securities, together with the
consideration we will pay for the common securities, to purchase the junior
debentures. The junior debentures will initially have an aggregate principal
amount of $206,186,000, which will equal the sum of the initial aggregate
liquidation amount of the trust preferred securities and the common securities.
Unless the trust distributes the junior debentures in exchange for the trust
preferred securities as described below, the junior debentures will be held in
the name of the property trustee in trust for the benefit of the holders of the
trust preferred securities and common securities.

The junior debentures will be our general and unsecured obligations and will be
subordinated in right of payment to all of our senior debt as described in "--
Subordination". Because we are a holding company, the junior debentures will
also effectively be subordinated to all existing and future liabilities of our
banking subsidiaries.

The junior debentures will have a stated maturity of July ., 2029.

INTEREST

Interest will accrue on the principal of the junior debentures from their
original issue date at LIBOR plus .%. Unless deferred as described below,
interest will be payable quarterly in arrears on ., ., . and . of each year
commencing on ., 1999, to the persons who are the record holders of the junior
debentures at the close of business on the 15th day -- whether or not a
business day -- next preceding the relevant interest payment date. The amount
of interest payable for any period will be computed on the basis of a 360-day
year of twelve 30-day months.

The Bank of New York, as Calculation Agent (the "Calculation Agent"), will
calculate the interest rate for each Interest Period based on LIBOR determined
as of two London Banking Days (defined as any day on which dealings in deposits
in U.S. Dollars are transacted in the London interbank market) prior to the
first day of such Interest Period (each, a "Determination Date").

We will have the right to defer the payment of interest on the junior
debentures as long as no indenture event of default has occurred and is
continuing, as described in "Description of Trust Preferred Securities --
Distributions -- Deferral periods". During a deferral period, interest will
continue to accrue on the junior debentures and additional interest will accrue
on each deferred interest payment at .%, compounded quarter-annually from the
corresponding interest payment date. The term interest, wherever we use it in
this prospectus with respect to the junior debentures, includes any of this
additional interest. In addition, during any deferral period, the indenture
will prohibit us and our subsidiaries from taking certain actions described in
"Description of Trust Preferred Securities -- Distributions -- Deferral period
restrictions".

Any interest that would otherwise become due and payable in respect of any
junior debentures during a deferral period will not become due and payable
until the day after the period ends. If the principal of any junior debentures
becomes due and payable on a day that would otherwise occur during a deferral
period, that period will end automatically on the next preceding day.

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LIBOR. LIBOR is the rate that most banks charge one another for large overnight
loans of Eurodollars in the London market. LIBOR means:

(1) the rate (expressed as a percentage per annum) for Eurodollar deposits
having a three-month maturity that appears on Telerate Page 3750 as of
11:00 a.m. (London time) on the related Determination Date;

(2) if such rate does not appear on Telerate Page 3750 as of 11:00 a.m.
(London time) on the related Determination Date, LIBOR will be the
arithmetic mean (if necessary, rounded upwards to the nearest whole
multiple of 0.00001%) of the rates (expressed as percentages per annum)
for Eurodollar deposits having a three-month maturity that appear on
Reuters Monitor Money Rates Page LIBO ("Reuters Page LIBO") as of 11:00
a.m. (London time) on such Determination Date;

(3) if such rate does not appear on Reuters Page LIBO as of 11:00 a.m.
(London time) on the related Determination Date, the Calculation Agent
will request the principal London offices of four leading banks in the
London interbank market to provide such banks' offered quotations
(expressed as percentages per annum) to prime banks in the London
interbank market for Eurodollar deposits having a three-month maturity
as of 11:00 a.m. (London time) on such Determination Date. If at least
two quotations are provided, LIBOR will be the arithmetic mean (if
necessary, rounded upwards to the nearest whole multiple of 0.00001%) of
such quotations;

(4) if fewer than two such quotations are provided as requested in clause
(3) above, the Calculation Agent will request four major New York City
banks to provide such banks' offered quotations (expressed as
percentages per annum) to leading European banks for loans in
Eurodollars having a three-month maturity as of 11:00 a.m. (London time)
on such Determination Date. If at least two such quotations are
provided, LIBOR will be the arithmetic mean (if necessary, rounded
upwards to the nearest whole multiple of 0.00001%) of such quotations;
and

(5) if fewer than two such quotations are provided as requested in clause
(4) above, LIBOR will be LIBOR as determined on the previous
Determination Date.

If the rate for Eurodollar deposits having a three-month maturity that
initially appears on Telerate Page 3750 or Reuters Page LIBO, as the case may
be, as of 11:00 a.m. (London time) on the related Determination Date is
superseded on Telerate Page 3750 or Reuters Page LIBO, as the case may be, by a
corrected rate before 12:00 noon (London time) on such Determination Date, the
corrected rate as so substituted on the applicable page will be applicable
LIBOR for such Determination Date.

Absent manifest error, the Calculation Agent's determination of LIBOR and its
calculation of the applicable interest rate for each Interest Period will be
final and binding. Investors may obtain the interest rates for the current and
preceding Interest Period by writing or calling Corporate Trust Administration
at the Calculation Agent at The Bank of New York, 101 Barclay Street, Floor 21
West, New York, New York 10286 (telephone (800) 524-4458).

REDEMPTION

We will have the option to redeem the junior debentures before the stated
maturity as follows:

(1) in whole at any time or in part from time to time on or after July .,
2004, provided that no partial redemption may occur during a deferral
period; or

(2) in whole at any time within 90 days after the occurrence of a tax event
or a capital treatment event.

The definitions of the term tax event and capital treatment event are set forth
in "Description of Trust Preferred Securities -- Redemption".

If we redeem any junior debentures, we will do so at a redemption price of 100%
of their principal amount plus accrued and unpaid interest to the date of
redemption. Unless we default in payment of the redemption price, interest will
cease to accrue on the junior debentures called for redemption on and after the
redemption date. We may not redeem any junior debentures on a redemption date
that would occur during a deferral period unless we redeem all of the
outstanding junior debentures.

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We must give notice of any redemption to the holders of the junior debentures
not less than 30 days nor more than 60 days before the redemption date, in the
manner described below under "-- Notices". In all other respects, the
procedures for redeeming the junior debentures will be similar to those for
redeeming the trust preferred securities. See "Description of Trust Preferred
Securities -- Redemption -- Redemption procedures".

Payment of additional sums. As described under "Description of Trust Preferred
Securities -- Redemption -- Payment of additional amounts", if a tax event has
occurred and is continuing, we may be obligated to pay additional sums on the
junior debentures.

EXCHANGE OF TRUST PREFERRED SECURITIES FOR JUNIOR DEBENTURES

As described under "Description of Trust Preferred Securities -- Exchange of
Trust Preferred Securities for Junior Debentures", we may elect to dissolve the
trust and cause the trust to distribute an equivalent amount of the junior
debentures to the holders of the trust preferred securities and common
securities in exchange for these securities. Junior debentures distributed in
exchange for trust preferred securities held in book-entry form will also be
issued in book-entry form. We expect that the book-entry arrangements for the
junior debentures will be substantially similar to those that will apply to the
trust preferred securities. For further information on book-entry arrangements,
see "Book-Entry Issuance".

If an exchange distribution occurs, we will be obligated to use our best
efforts to list the junior debentures on any stock exchange or organization on
which the trust preferred securities are then listed. We can give no assurance
as to the market price of any junior debentures that may be distributed to the
holders of the trust preferred securities.

CERTAIN COVENANTS MADE BY US IN THE INDENTURE

We will make the following covenants in the indenture:

. to hold, directly or indirectly through one or more of our subsidiaries, 100%
of the common securities, provided that permitted successors under the
indenture may succeed to our ownership of the common securities;

. not to voluntarily terminate, wind-up or liquidate the trust, except with the
prior approval of the Federal Reserve, if required at the time, and either in
connection with (1) a distribution of junior debentures in exchange for trust
preferred securities or (2) any merger, consolidation or amalgamation
permitted by the amended trust agreement; and

. to use our reasonable efforts, consistent with the amended trust agreement,
to cause the trust to be classified as a grantor trust and not to be taxable
as a corporation for U. S. federal income tax purposes.

MODIFICATION OF THE INDENTURE

From time to time we and the indenture trustee may, without the consent of the
holders of the junior debentures, amend, waive or supplement the indenture for
specified purposes. These include curing ambiguities, defects or
inconsistencies, provided that doing so does not adversely affect the interests
of the holders of the junior debentures or the trust preferred securities in
any material respect, and qualifying, or maintaining the qualification of, the
indenture under the Trust Indenture Act.

The indenture also permits us and the indenture trustee, with the consent of
the holders of a majority of the outstanding junior debentures, to modify the
indenture in any manner whatsoever. However, we and the indenture trustee may
not modify the indenture in the following ways without the consent of the
holder of each outstanding junior debenture:

. change the stated maturity of the junior debentures;

. reduce the principal amount of the junior debentures;

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. reduce the rate of interest on or any premium payable upon the redemption of
the junior debentures;

. change the place of payment where, or the currency in which, any amount is
payable on the junior debentures;

. impair the right to institute a suit for enforcement of any junior debenture;
or

. reduce the percentage of principal amount of the outstanding junior
debentures, the holders of which are required to consent to any modification
of the indenture.

As long as the trust preferred securities are outstanding, any modification,
waiver or termination of the indenture that will adversely affect the holders
of the trust preferred securities cannot be made without obtaining the consent
of at least a majority of the holders of trust preferred securities. See
"Description of Trust Preferred Securities -- Enforcement Rights".

INDENTURE EVENTS OF DEFAULT

Each of the following events will be an indenture event of default:

. failure to pay any interest or additional sum on the junior debentures when
due and continuation of the default for 30 days, subject to any deferral
period;

. failure to pay any principal of the junior debentures when due;

. failure to observe or perform any other covenants in the indenture in any
material respect for 90 days after written notice has been given to us by the
indenture trustee or the holders of at least 25% of the outstanding junior
debentures; and

. certain events of bankruptcy, insolvency or reorganization of Riggs National
Corporation.

If an indenture event of default has occurred and is continuing, either the
indenture trustee or the holders of not less than 25% of the outstanding junior
debentures may declare the principal of all junior debentures to be due and
payable immediately. If the trust preferred securities are outstanding and the
indenture trustee or those holders of junior debentures fail to exercise this
right, the holders of at least 25% of the outstanding trust preferred
securities may do so.

The holders of a majority of the outstanding junior debentures may annul any
declaration of acceleration if we paid or deposited with the property trustee
all matured installments of interest and principal, and any additional sums,
due otherwise than by acceleration. Upon such payment, if the holders of junior
debentures do not exercise this right, the holders of a majority of the
outstanding trust preferred securities may do so.

The holders of a majority of the outstanding junior debentures may waive any
default under the indenture other than:

. a default in the payment of principal or interest, and any additional sum,
unless the default has been cured; or

. a default in respect of a covenant that under the indenture cannot be
modified or amended without the consent of the holder of each affected junior
debenture.

If the holders of the junior debentures do not waive a default under the
indenture as permitted, the holders of a majority in aggregate liquidation
amount of the outstanding trust preferred securities may do so.

The holders of a majority of outstanding junior debentures will have the right
to direct the time, method and place of conducting any proceeding for any
remedy available to the indenture trustee. This right, as well as the rights of
the holders of junior debentures with regard to acceleration, annulment and
waiver described above, will be subject to the enforcement rights of the
holders of trust preferred securities when the trust preferred securities are
outstanding. See "Description of Trust Preferred Securities -- Enforcement
Rights".

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We will be obligated to provide the indenture trustee, and, if the trust
preferred securities are outstanding, the property trustee, annually a
certificate as to whether or not we are in compliance with the applicable
provisions of the indenture.

CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS

We may not consolidate with, or merge with or into, or convey, transfer or
lease our properties and assets substantially as an entirety to, any other
entity, referred to as a successor transaction, unless the following conditions
are satisfied:

. the successor entity, if not us, must be organized under the laws of the
United States or any state of the United States or the District of Columbia,
and must expressly assume our obligations in respect of the junior
debentures, the indenture, the guarantee and the expense agreement;

. immediately after giving effect to the transaction, no indenture event of
default, and no event that, after notice or lapse of time or both, would
become an indenture event of default, will have occurred and be continuing;

. such transaction is permitted under the amended trust agreements; and

. we deliver to the property trustee an officer's certificate and opinion of
counsel, each stating that such transaction complies with the indenture and
that the property trustee can rely on the opinion and certificate.

The general provisions of the indenture do not afford holders of the junior
debentures or trust preferred securities protection in the event of a highly
leveraged or other transaction involving us that may adversely affect the
interests of those holders.

SATISFACTION AND DISCHARGE

Except as noted below, the indenture will cease to be of further effect, and we
will be deemed to have satisfied and discharged the indenture, when the
following conditions have been satisfied:

. all junior debentures not previously delivered to the indenture trustee for
cancellation have become due and payable or will become due and payable at
their stated maturity or on a redemption date within one year;

. we deposit with the indenture trustee, in trust, funds sufficient to pay the
entire indebtedness on those junior debentures not previously delivered for
cancellation, for the principal and interest, including any additional sums,
to the date of the deposit for junior debentures that have become due and
payable or to the stated maturity or the redemption date, as the case may be
for junior debentures that have not; and

. we delivered to the indenture trustee an officer's certificate and an opinion
of counsel each stating that we complied with the conditions relating to the
satisfaction of the indenture, as stated above.

We will remain obligated to provide for registration of transfer and exchange
and notices of redemption and in other ministerial respects.

SUBORDINATION

To the extent set forth in the indenture, the junior debentures will be
subordinated in right of payment to all of our senior debt. The subordination
provisions will have the following significant effects.

If we default in the payment of any principal, interest or other amount payable
on any senior debt when the same becomes due and payable, we may not make or
agree to make any payment in respect of the junior debentures, or in respect of
any redemption, repayment, retirement, purchase or other acquisition of the
junior debentures, unless and until that default has been cured or waived or
has otherwise ceased to exist, or all

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senior debt has been paid. This prohibition would apply to payments of
principal, interest and additional sums on any junior debentures, as well as to
payments in respect of any acquisition or retirement of junior debentures.

In addition, if any of the following events occurs, all senior debt, including
any interest that accrues after the commencement of any proceedings, must be
paid in full before any payment or distribution may be made on account of the
junior debentures:

. the commencement of any insolvency, bankruptcy, receivership, liquidation,
reorganization, readjustment, composition or other similar proceeding
relating to us, our creditors or our property;

. the commencement of any proceeding for the liquidation, dissolution or other
winding up of Riggs National Corporation, voluntary or involuntary, whether
or not involving insolvency or bankruptcy proceedings;

. any assignment by us for the benefit of creditors; or

. any other marshaling of our assets.

In any of these events, any payment or distribution on account of the junior
debentures that would otherwise, but for the subordination provisions, be
payable or deliverable in respect of the junior debentures will be paid or
delivered directly to the holders of senior debt in accordance with the
priorities then existing among those holders, until all senior debt, including
any post-commencement interest, has been paid in full.

In the event of any proceeding described above, after payment in full of all
sums owing with respect to senior debt, the holders of junior debentures,
together with the holders of any of our obligations ranking equally with the
junior debentures, will be entitled to be paid from our remaining assets the
amounts at the time due and owing on the junior debentures and those other
obligations before any payment or other distribution will be made on account of
any of our capital stock or any of our obligations ranking junior in right of
payment to the junior debentures.

If any holder of junior debentures receives any payment or distribution on
account of the junior debentures before all the senior debt has been paid in
full, or otherwise in contravention of any of the subordination provisions, the
holder must receive the payment or distribution in trust for the benefit of,
and must pay over or deliver and transfer the same to, the holders of the
senior debt at the time outstanding in accordance with the priorities then
existing among them for application to the payment of all senior debt remaining
unpaid, to the extent necessary to pay all the senior debt in full.

If we become insolvent, then by reason of the subordination provisions, holders
of senior debt may receive more, ratably, and holders of the junior debentures
may receive less, ratably, than our other creditors.

Definition of senior debt. Senior debt means any of our obligations to our
creditors, whether outstanding now or incurred in the future, except (1) where
the indenture or other document under which the obligation is issued provides
that the obligation is not superior in right of payment to the junior
debentures or to other debt which ranks equally with the junior debentures, (2)
trade accounts payable or accrued liabilities arising in the ordinary course of
business, but does not include:

. debt of ours to any of our subsidiaries or employees;

. debt that was without recourse to us when incurred;

. our 8.625% Junior Subordinated Deferrable Interest Debentures issued to a
subsidiary trust on December 13, 1996;

. our 8.875% Junior Subordinated Deferrable Interest Debentures issued to a
subsidiary trust on March 12, 1997; or

. any subordinated debt securities of ours that we issue in the future with
substantially similar subordinated terms.

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PAYMENT AND PAYING AGENTS

Unless we distribute the junior debentures in exchange for the trust preferred
securities, payments in respect of the junior debentures will be made to or
upon the order of the property trustee. If in the future we distribute the
junior debentures in exchange for the trust preferred securities, payments in
respect of the junior debentures will be made in accordance with provisions
similar to those applicable to payments in respect of the trust preferred
securities. For further information, see "Description of Trust Preferred
Securities -- Payment and Paying Agency".

NOTICES

Notices to holders of junior debentures under the indenture will also be given
to the holders of the trust preferred securities in accordance with provisions
similar to those described in "Description of Trust Preferred Securities --
Notices" and to the property trustee. If in the future we distribute the
junior debentures in exchange for the trust preferred securities, notices to
holders of junior debentures will be given to those holders in accordance with
the provisions for notices to trust preferred securities holders referred to
above.

THE INDENTURE TRUSTEE

The indenture trustee will have all the duties and responsibilities specified
with respect to an indenture trustee under the Trust Indenture Act. Subject to
those provisions, the indenture trustee will have no obligation to exercise any
of the powers vested in it by the indenture at the request of any holder of
junior debentures, unless offered reasonable indemnity by such holder against
the costs, expenses and liabilities that might be incurred. The indenture
trustee will not be required to expend or risk its own funds or otherwise incur
personal financial liability in the performance of its duties if it reasonably
believes that repayment or adequate indemnity is not reasonably assured to it.

The Bank of New York, the debenture trustee, may serve from time to time as
trustee under other indentures or trust agreements entered into with us or our
subsidiaries relating to issues of other securities. In addition, we and some
of our affiliates may have other banking relationships with The Bank of New
York.

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Description of the Guarantee and the Expense Agreement

This section summarizes the material provisions of the guarantee agreement and
the agreement as to expenses and liabilities. The guarantee agreement and the
expense agreement contain the full legal text of the matters described in this
section and are governed by New York law. We have filed with the SEC a form of
each of these agreements as exhibits to our registration statement. See "Where
to Find More Information" on page 60 for information on how to obtain a copy.

THE GUARANTEE

We will execute a guarantee agreement when the trust preferred securities are
issued. The Bank of New York will act as trustee under the guarantee for the
purpose of compliance with the Trust Indenture Act, and the guarantee will be
qualified as an indenture under the Trust Indenture Act. The guarantee trustee
will hold the guarantee for the benefit of the holders of the trust preferred
securities.

Under the guarantee, we will irrevocably and unconditionally agree to pay in
full, on a subordinated basis and to the extent described below, to the holders
of the trust preferred securities, the guarantee payments as and when due,
regardless of any defense, right of set-off or counterclaim that the trust may
have or assert other than the defense of payment. The following payments in
respect of the trust preferred securities, to the extent not paid by or on
behalf of the trust, are guarantee payments:

. any accumulated and unpaid distributions required to be paid on the trust
preferred securities, to the extent that the trust has funds legally and
immediately available to pay them;

. any redemption price required to be paid on the trust preferred securities,
to the extent that the trust has funds legally and immediately available to
pay it; and

. upon a voluntary or involuntary termination, winding-up or liquidation of the
trust unless the junior debentures are distributed to holders of the trust
preferred securities in exchange for these securities, the lesser of (1) the
liquidation distribution for the trust preferred securities and (2) the
amount of assets of the trust remaining available for distribution to holders
of trust preferred securities after satisfaction of liabilities to creditors
of the trust as required by applicable law.

We may satisfy our obligation to make a guarantee payment by paying the
required amounts directly to the holders of the trust preferred securities, or
by causing the trust to pay them to the holders.

We will be required to make payments under the guarantee only to the extent
that the trust has funds sufficient to make payments in respect of its
obligations under the trust preferred securities. If and to the extent we do
not make payments on the junior debentures, the trust will not be able to make
payments on the trust preferred securities and will not have funds available to
do so. However, through the guarantee, the amended trust agreement, the junior
debentures, the indenture and the expense agreement, taken together, we have
fully, irrevocably and unconditionally guaranteed all the trust's obligations
under the trust preferred securities. See "Relationship Among the Trust
Preferred Securities, the Junior Debentures, the Guarantee and the Expense
Agreement".

The guarantee will guarantee payment and not collection. This means that any
holder of outstanding trust preferred securities may begin a legal proceeding
directly against us to enforce its rights under the guarantee without first
beginning a legal proceeding against the trust, the guarantee trustee or any
other party.

STATUS OF THE GUARANTEE

The guarantee will be a general unsecured obligation of Riggs National
Corporation and will be subordinated in right of payment to all of our senior
debt in the same manner as the junior debentures.

Because we are a holding company, our obligations under the guarantee, like our
obligations under the junior debentures, will also be effectively subordinated
to all existing and future liabilities of our bank subsidiaries and any other
subsidiaries we may have. See "Description of Junior Debentures --
Subordination".

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AMENDMENTS, ASSIGNMENT AND SUCCESSION

We and The Bank of New York may not amend the guarantee in a way that will
adversely affect in any material respect the rights of the holders of the trust
preferred securities without the consent of a majority of the outstanding trust
preferred securities. The manner of obtaining any such approval will be similar
to the manner in which any approval to amend the amended trust agreement may be
obtained. See "Description of Trust Preferred Securities -- Amendment of the
Trust Agreement".

We may not assign our obligations under the guarantee except in connection with
a merger, consolidation or amalgamation which is permitted under the indenture.
In addition, any permitted successor to our obligations under the indenture
will also succeed to our obligations under the guarantee. See "Description of
Junior Debentures -- Consolidation, Merger, Sale of Assets and Other
Transactions". The guarantee will bind our successors, assigns, receivers,
trustees and representatives and will inure to the benefit of the holders of
the outstanding trust preferred securities.

EVENTS OF DEFAULT

An event of default under the guarantee will occur if we fail to (1) make any
guarantee payment when obligated to do so, or (2) perform any other obligation
and the default remains unremedied for 30 days. The holders of a majority of
the outstanding trust preferred securities will have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the guarantee trustee or to direct the exercise of any trust or power conferred
upon the guarantee trustee under the guarantee.

We, as guarantor, will be obligated to file annually with the guarantee trustee
a certificate as to our compliance with all the conditions and covenants
applicable to us under the guarantee.

THE GUARANTEE TRUSTEE

The guarantee trustee undertakes to perform only those duties that are
specifically set forth in the guarantee, except that, after a default by us
under the guarantee, it must exercise the same degree of care and skill as a
prudent person would exercise or use in the conduct of his or her own affairs.
Subject to this provision, the guarantee trustee is under no obligation to
exercise any of the powers vested in it by the guarantee at the request of any
holder of trust preferred securities unless it is offered reasonable indemnity
against the costs, expenses and liabilities that it might incur as a result.

TERMINATION OF THE GUARANTEE

The guarantee will terminate and be of no further force or effect (1) when the
guarantee payments have been paid in full by us, the trust or both or (2) when
the junior debentures are distributed to the holders of the trust preferred
securities in exchange for their securities. Until that time, the guarantee
will remain in full force and effect. In addition, the guarantee will continue
to be effective or will be reinstated, as the case may be, if at any time any
holder of the trust preferred securities must restore payment of any sums paid
to it under the trust preferred securities or the guarantee.

THE EXPENSE AGREEMENT

In the expense agreement, we will irrevocably and unconditionally guarantee to
each person to whom the trust becomes indebted or liable, the full payment of
all the trust's costs, expenses and liabilities, other than the obligations of
the trust to pay amounts due to the holders of the trust preferred securities
and common securities pursuant to the terms of those securities. The expense
agreement will be enforceable by third parties.

Our obligations under the expense agreement will be subordinated in right of
payment to the same extent as the guarantee. Our obligations under the expense
agreement will be subject to provisions regarding amendment, termination,
assignment, succession and governing law similar to those applicable to the
Guarantee.

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Relationship among the Trust Preferred Securities, the Junior Debentures, the
Guarantee and the Expense Agreement

FULL, IRREVOCABLE AND UNCONDITIONAL GUARANTEE

Taken together, our obligations under the trust agreement, the junior
debentures, the indenture, the guarantee and expense agreement provide a full,
irrevocable and unconditional guarantee of the trust's obligations under the
trust preferred securities. No single document standing alone or operating in
conjunction with fewer than all the other documents provides this guarantee. It
is only the combined operation of these documents that has the effect of
providing a full, irrevocable and unconditional guarantee of the trust's
obligations under the trust preferred securities.

If and to the extent that we do not make payments on the junior debentures, the
trust will not have funds available for payments on the trust preferred
securities. The guarantee will not apply to payment of any amounts due on the
trust preferred securities when the trust does not have available funds to pay
those amounts. In that event, the remedy of a holder of trust preferred
securities is to exercise its right of direct action -- that is, to begin a
legal proceeding directly against us for enforcement of our obligations under
junior debentures.

If we make payment on the junior debentures and the trust has funds available
to make payments on the trust preferred securities but fails to do so, a holder
of trust preferred securities may begin a legal proceeding against us to
enforce our obligations under the guarantee to make these payments or to cause
the trust to make these payments. In the event that the trust receives payments
on the junior debentures, but these funds are unavailable for payment on the
trust preferred securities because of claims made by creditors of the trust, we
would be obligated under the expense agreement to pay those claims.

Our obligations under the junior debentures, the guarantee and the expense
agreement are subordinated in right of payment to all of our senior debt. They
are subordinated in the manner described in "Description of Junior
Debentures -- Subordination" and "Description of the Guarantee and the Expense
Agreement -- Status of the Guarantee".

SUFFICIENCY OF PAYMENTS

As long as payments are made when due on the junior debentures, those payments
should be sufficient to fund distributions and other amounts payable on the
trust preferred securities, primarily because:

. the aggregate principal amount of the junior debentures will equal the
aggregate liquidation amount of the trust preferred securities and the common
securities;

. the interest rate, interest payment dates and other payment dates for the
junior debentures will match the distribution rate, distribution dates and
other payment dates for the trust preferred securities;

. the expense agreement provides that we will pay any and all costs, expenses
and liabilities of the trust, other than the trust's obligations under the
trust preferred securities and common securities; and

. the amended trust agreement provides that the trust will not engage in any
activity that is not consistent with the limited purposes of the trust.

Despite anything to the contrary in the indenture, we have the right to set off
any payment we make under the guarantee in respect of the trust preferred
securities against any payment we are otherwise required to make under the
indenture in respect of the junior debentures.

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ENFORCEMENT RIGHTS OF HOLDERS OF TRUST PREFERRED SECURITIES

A holder of trust preferred securities may begin a legal proceeding directly
against us to enforce its right of direct action under the indenture without
first beginning a legal proceeding against the trust, the property trustee or
any other party. A holder of trust preferred securities may also begin a legal
proceeding directly against us to enforce its rights under the guarantee
without first instituting a legal proceeding against the guarantee trustee, the
trust or any other party.

A default or event of default under any of our senior debt would not be a
default with respect to the trust preferred securities or the junior
debentures. However, in the event of a payment default under, or acceleration
of, any of our senior debt, the subordination provisions of the indenture
provide that no payments may be made in respect of the junior debentures, until
the senior debt has been paid in full or any payment default under that debt
has been cured or waived. See "Description of Junior Debentures --
Subordination".

LIMITED PURPOSE OF ISSUER TRUST

The trust preferred securities evidence a preferred undivided beneficial
interest in the assets of the trust, and the trust exists solely to issue and
sell the trust preferred securities and common securities, invest the sale
proceeds in the junior debentures and engage only in such other activities as
may be necessary or incidental to those activities. A principal difference
between the rights of a holder of trust preferred securities against the trust
and those of a holder of junior debentures against us is that a holder of
junior debentures is entitled to receive from us all amounts payable on the
junior debentures, while a holder of trust preferred securities is entitled to
receive from the trust, or from us under the guarantee, amounts payable on the
trust preferred securities only if and to the extent the trust has funds
available to pay those amounts.

RIGHTS UPON TERMINATION

Upon any voluntary or involuntary termination, winding-up or liquidation of the
trust, the holders of trust preferred securities will be entitled to receive an
equivalent amount of junior debentures in exchange for their trust preferred
securities, subject to prior satisfaction of liabilities to creditors of the
trust. If the property trustee determines that a distribution of junior
debentures is not practical, the holders of trust preferred securities will be
entitled to receive a liquidation distribution out of the assets held by the
trust after satisfaction of those liabilities. For further information, see
"Description of Trust Preferred Securities --Liquidation Distribution upon
Termination".

Upon any voluntary or involuntary liquidation or bankruptcy of Riggs National
Corporation, the property trustee, as registered holder of the junior
debentures, would be our creditor and would be subordinated in right of payment
to all of our senior debt as set forth in the indenture. However, the property
trustee would be entitled to receive payment in full of all amounts payable
with respect to the junior debentures before any holders of our capital stock
received payments or distributions.

In light of the effective guarantee provided by the combined operation of the
documents described above and the subordinated status of the obligations they
evidence, the positions of a holder of trust preferred securities and a holder
of junior debentures, in the event of our liquidation or bankruptcy, should be
substantially the same, relative to our other creditors and to our
shareholders.

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Book-Entry Issuance

The information in this section has been obtained from sources that we and the
trust believe to be accurate, but neither we nor the trust assume
responsibility for its accuracy. None of us, the trustees nor the trust has any
responsibility for the performance by DTC or its participants of their
obligations as described in this section or under the rules and procedures
governing their operations.

The trust preferred securities will be issued in the form of one or more global
certificates. A global certificate represents a large amount of securities and
is registered in the name of a financial institution that holds the certificate
as a depositary on behalf of its customers, who in turn own the beneficial
interests in those securities. The trust preferred securities global
certificates will be registered in the name of DTC, which will act as
securities depositary for all of the trust preferred securities except in the
circumstances we describe at the end of this section. We refer to trust
preferred securities represented by a global certificate as being issued in
global or book-entry form.

THE DTC SYSTEM

DTC has advised us that it is a limited-purpose trust company created to hold
securities for its participating organizations, or its participants, and to
facilitate the clearance and settlement of transactions in those securities
between participants through electronic book-entry changes in accounts of its
participants. The participants include securities brokers and dealers including
the underwriters, banks, trust companies, clearing corporations and certain
other organizations. Access to DTC's system is also available to other entities
such as banks, brokers, dealers and trust companies that clear through or
maintain a custodial relationship with a participant, either directly or
indirectly. We refer to these entities as indirect participants.

If you buy trust preferred securities while they are represented by a global
certificate, you must do so through a participant, which will receive a credit
in DTC's book-entry system for those trust preferred securities, and your
ownership interest will in turn be recorded on the participant's records. We
refer to persons who have acquired an interest in a global security as a
beneficial owner. Beneficial owners will not receive written confirmation from
DTC of their purchases, but we expect that beneficial owners will receive
written confirmations providing details of the transactions, as well as
periodic statements of their holdings, from the participants through which they
purchased the trust preferred securities. Transfers by beneficial owners of
ownership interests in the global certificates will be accomplished by entries
made on the books of participants or indirect participants acting on their
behalf. Transfers between DTC's participants will be effected in the ordinary
way in accordance with DTC's rules and will be settled in same-day funds.
Beneficial owners will not receive certificates representing their ownership
interests in trust preferred securities, unless the book-entry system for the
trust preferred securities is discontinued, which will only happen under the
circumstances we describe at the end of this section.

DTC has no knowledge of the actual beneficial owners of the trust preferred
securities. DTC's records reflect only the identity of the participants to
whose accounts the trust preferred securities are credited, which may or may
not be the beneficial owners. The participants and indirect participants are
responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to participants, by
participants to indirect participants and by participants and indirect
participants to beneficial owners, as well as the voting rights of
participants, indirect participants and beneficial owners, will be governed by
arrangements among them. Those arrangements may be subject to statutory or
regulatory requirements in effect from time to time.

Redemption notices will be sent to DTC or its nominee as the registered holder
of the trust preferred securities. If less than all of the trust preferred
securities are being redeemed, DTC's current practice is to determine by lot
the amount of the interest of each participant to be redeemed. Although voting
with respect to the trust preferred securities is limited to the holders of
record of the trust preferred securities, in those instances in which a vote is
required, neither DTC nor its nominee would itself consent or vote with respect
to the trust preferred securities. Under its usual procedures, DTC would mail
an omnibus proxy to the property trustee as soon as possible after the record
date. The omnibus proxy assigns the consenting or voting rights of DTC or its
nominee to those participants to whose accounts the trust preferred securities
are credited on the record date identified in a listing attached to the omnibus
proxy.

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EXCHANGE OF GLOBAL CERTIFICATES FOR NON-GLOBAL CERTIFICATES

Trust preferred securities represented by a global certificate will not be
exchanged for trust preferred securities represented by a non-global
certificate -- that is, one registered in the name of a person other than DTC
or its nominee -- unless any of the following events occurs:

. DTC notifies the trust that it is unwilling or unable to continue as
depositary for the global certificate and no successor depositary has been
appointed;

. DTC ceases to be a clearing agency registered under the Securities Exchange
Act of 1934 at any time when it is required to be so registered to act as a
depositary;

. the trust in its sole discretion determines that the global certificate will
be exchangeable; or

. an indenture event of default has occurred and is continuing, and holders of
a majority of the outstanding trust preferred securities determine to
discontinue the system of book-entry transfers.

Any global certificate that is exchangeable as described above will be
exchangeable for non-global certificates registered in the names that DTC
directs. We expect that DTC will base these directions on instructions received
by it from its participants with respect to ownership of beneficial interests
in the global certificate. If trust preferred securities are issued in non-
global form, they will be issued in denominations of $1,000 and multiples of
that amount and may be transferred or exchanged at the corporate office of the
property trustee in New York, New York, or at the offices of any paying agent
or transfer agent chosen by the property trustee and acceptable to the
administrators.

BENEFICIAL OWNERS WILL NOT BE REGISTERED OWNERS

As the registered holder of the global certificate representing the trust
preferred securities, DTC or its nominee will be the sole owner and holder of
all the trust preferred securities for all purposes under the amended trust
agreement, the indenture and the guarantee. Consequently, unless and until
beneficial owners receive non- global certificates representing their ownership
interests in the trust preferred securities and registered in their own name,
beneficial owners will not be considered the registered owners or holders of
the trust preferred securities for any purpose under those documents. We and
the trust will make all payments and give all notices required to be made or
given under those documents directly to DTC or its nominee and not to any
beneficial owner. Once we and the trust do so, we and the trust will have no
further responsibility for any payments or notices, even if DTC or its nominee,
or any participant or indirect participant, fails to pass them along to the
beneficial owners.

The rights and interests of beneficial owners will be subject to the rules and
practices of DTC and its participants and indirect participants, as applicable.
The rules and practices are subject to change by them, and we assume no
responsibility for those rules and practices.

The laws of some jurisdictions require that certain purchasers must take
physical delivery of securities in non-global form. As a result, the ability to
transfer beneficial interests in a global certificate to those purchasers may
be limited. Also, the ability of beneficial owners to pledge their beneficial
interests to persons or entities that do not participate in the DTC system, or
otherwise take actions in respect of those interests, may be impaired by the
lack of a non-global certificate representing those interests.

REGISTRATION OF JUNIOR DEBENTURES

The junior debentures will initially be registered in the name of and held by
the property trustee. If in the future the junior debentures are distributed to
the holders of trust preferred securities in exchange for the trust preferred
securities and the trust preferred securities are then held in book-entry form,
the junior debentures would be distributed in book-entry form. We expect that
the book-entry arrangements applicable to the junior debentures would be
similar to those applicable to the trust preferred securities. If junior
debentures are issued in non-global form, they will be issued in denominations
of $1,000 and multiples of that amount.

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DTC YEAR 2000 EFFORTS

DTC has advised us that its management is aware that some computer applications
systems, and the like for processing data that are dependent upon calendar
dates, including dates before, on and after January 1, 2000, may encounter Year
2000 problems.

DTC has informed its participants and other members of the financial community,
or the industry, that it has developed and is implementing a program so that
its systems, as the same relate to the timely payment of distributions,
including principal and income payments, to securityholders, book-entry
deliveries, and settlement of trades within DTC continue to function
appropriately. This program includes a technical assessment and a remediation
plan, each of which is complete.

Additionally, DTC's plan includes a testing phase, which is expected to be
completed within appropriate time frames.

However, DTC's ability to perform properly its services is also dependent upon
other parties, including but not limited to issuers and their agents, as well
as third-party vendors from whom DTC licenses software and hardware, and third-
party vendors on whom DTC relies for information or the provision of services,
including telecommunication and electrical utility service providers, among
others. DTC has informed the industry that it is contacting and will continue
to contact third-party vendors from whom DTC acquires services to:

. impress upon them the importance of such services being Year 2000 compliant;
and

. determine the extent of their efforts for Year 2000 remediation, and, as
appropriate, testing, of their services.

In addition, DTC is in the process of developing contingency plans as it deems
appropriate.

According to DTC, the preceding Year 2000 information has been provided to the
industry for informational purposes only and is not intended to serve as a
representation, warranty or contract modification of any kind.

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U.S. Federal Income Tax Considerations

The following summary of the material U.S. federal income tax consequences to
the purchase, ownership and disposition of trust preferred securities only
addresses the tax consequences to a U.S. holder that acquires trust preferred
securities on their original issue date at their original offering price. You
are a U.S. holder if you are a beneficial owner of a Trust Preferred security
that is:

. a citizen or resident of the United States;

. a domestic corporation;

. an estate whose income is subject to U.S. federal income tax regardless of
its source; or

. a trust if a U.S. court can exercise primary supervision over the trust's
administration and one or more U.S. persons have authority to control all
substantial decisions of the trust.

This summary does not apply to you if you are a member of a class of holders
subject to special rules, such as:

. a person that holds trust preferred securities as other than a capital asset;

. a dealer in securities or currencies;

. a trader in securities that elects to use a mark-to-market method of
accounting;

. a bank;

. an insurance company;

. a thrift institution;

. a regulated investment company;

. a real estate investment trust;

. a tax-exempt organization;

. a person that holds trust preferred securities that are a hedge or that are
hedged against interest rate or currency risks;

. a person that holds trust preferred securities as part of a straddle or
conversion transaction for tax purposes; or

. a person whose functional currency is not the U.S. dollar.

The statements of law or legal conclusion set forth in this summary constitute
the opinion of Sullivan & Cromwell, special tax counsel to us and the trust.
This summary is based upon the U.S. Internal Revenue Code of 1986, as amended
(referred to as the Code), its legislative history, existing and proposed
regulations under the Code, published rulings and court decisions, all as
currently in effect. These laws are subject to change, possibly on a
retroactive basis. The authorities on which this summary is based are subject
to various interpretations, and it is therefore possible that the federal
income tax treatment of the purchase, ownership and disposition of trust
preferred securities may differ from the treatment described below.

Please consult your own tax advisor concerning the consequences of owning the
trust preferred securities in your particular circumstances under the Code and
the laws of any other taxing jurisdiction.

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CLASSIFICATION OF THE JUNIOR DEBENTURES AND THE TRUST

Under current law and assuming full compliance with the terms of the amended
trust agreement and the indenture, the trust will not be taxable as a
corporation for U.S. federal income tax purposes. As a result, you will be
required to include in your gross income your proportional share of the
original issue discount ("OID") accrued on the junior debentures, whether or
not the trust actually distributes cash to you.

ORIGINAL ISSUE DISCOUNT

Because we have the right to defer the payment of interest on the junior
debentures, all interest payable on the junior debentures will be treated as
OID for federal income tax purposes. Accordingly, you will recognize income (in
the form of OID) on a daily basis under a constant yield method over the term
of your trust preferred security, regardless of the receipt of cash with
respect to the period to which such income is attributable. (Subsequent uses of
the term "interest" in this summary shall include income in the form of OID.)
The amount of OID that will accrue in any quarterly period (other than during a
period in which we exercise our option to defer interest payments on the junior
debenture) will equal approximately the amount of the interest that accrues on
the junior debentures in that semi-annual period at the stated interest rate.

DISTRIBUTION OF JUNIOR DEBENTURES TO HOLDERS OF TRUST PREFERRED SECURITIES UPON
LIQUIDATION OF THE TRUST

If the trust distributes the junior debentures as described under the caption
"Description of Trust Preferred Securities -- Liquidation Distribution upon
Termination", you will receive directly your proportional share of the junior
debentures previously held indirectly through the trust. Under current law, you
will not be taxed on the distribution and your holding period and aggregate tax
basis in your junior debentures will be equal to the holding period and
aggregate tax basis you had in your trust preferred securities before the
distribution. If, however, the trust were to become taxed on the income
received or accrued on the junior debentures due to a tax event, the trust
might be taxed on a distribution of junior debentures to you, and you might
recognize gain or loss as if you had exchanged your trust preferred securities
for the junior debentures you received upon the liquidation of the trust. You
will include interest in income in respect of junior debentures received from
the trust in the manner described above under "-- Original Issue Discount".

SALE OR REDEMPTION OF TRUST PREFERRED SECURITIES

If you sell your trust preferred securities, including through a redemption for
cash, you will recognize gain or loss equal to the difference between your
adjusted tax basis in your trust preferred securities and the amount you
realize on the sale of your trust preferred securities. Your adjusted tax basis
in your trust preferred securities generally will be the price you paid for
your trust preferred securities, increased by OID previously includible in your
gross income to the date of disposition and decreased by distributions or other
payments you received on your trust preferred securities. This gain or loss
generally will be a capital gain or loss. Capital gain of a non-corporate U.S.
holder is generally taxed at a maximum rate of 20% where the property is held
for more than one year.

If we exercise our option to defer any payment of interest on the junior
debentures, your trust preferred securities may trade at a price that does not
accurately reflect the value of accrued but unpaid interest with respect to the
underlying junior debentures. If you sell your trust preferred securities
before the record date for the payment of distributions, then you will not
receive payment of a distribution for the period before the sale. However, you
will be required to include accrued OID on the junior debentures through the
date of the sale as ordinary income for U.S. federal income tax purposes and to
add the amount of accrued but unpaid OID to your tax basis in the trust
preferred securities. Your increased tax basis in the trust preferred
securities will increase the amount of any capital loss that you may have
otherwise realized on the sale. In general, an individual taxpayer may only
offset $3,000 of capital losses against regular income during any year.

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

54
<PAGE>

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

BACKUP WITHHOLDING TAX AND INFORMATION REPORTING

The amount of interest income paid and OID accrued on your trust preferred
securities will be reported to the IRS unless you are a corporation or other
exempt U.S. holder. Backup withholding at a rate of 31% will apply to payments
of interest to you unless you are an exempt U.S. holder or you furnish your
taxpayer identification number in the manner prescribed in applicable
regulations, certify that such number is correct, certify as to no loss of
exemption from backup withholding and meet certain other conditions.

Payment of the proceeds from the disposition of trust preferred securities to
or through the U.S. office of a broker is subject to information reporting and
backup withholding unless you establish an exemption from information reporting
and backup withholding.

Any amounts withheld from you under the backup withholding rules will be
allowed as a refund or a credit against your U.S. federal income tax liability,
provided the required information is furnished to the IRS.

It is anticipated that the trust or its paying agent will report income on the
trust preferred securities to the IRS and to you on Form 1099 by January 31
following each calendar year.

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

55
<PAGE>

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

ERISA Considerations

If you are a fiduciary of a pension, profit-sharing or other employee benefit
plan subject to the Employee Retirement Income Security Act ("ERISA"), you
should review the fiduciary standards of ERISA and the plan's particular
circumstances before deciding to invest in the trust preferred securities. You
should consider whether the investment would satisfy the prudence and
diversification requirements of ERISA and whether the investment would be
consistent with the terms of the plan and the other agreements which apply to
plan investments.

A fiduciary of a plan subject to ERISA, as well as a person investing on behalf
of an individual retirement account or a pension or profit sharing plan for one
or more self-employed persons, should also consider whether an investment in
the trust preferred securities could result in a prohibited transaction. ERISA
and the Code prohibit plans and individual retirement accounts from engaging in
certain transactions involving plan assets with persons who are called parties
in interest under ERISA or disqualified persons under the Code with respect to
the plan or individual retirement account. A violation of these rules may
result in a substantial excise tax under the Code and other liabilities under
ERISA. Employee benefit plans which are governmental plans, foreign plans or
church plans generally are not subject to the prohibited transaction rules or
the fiduciary standards of ERISA.

The assets of the trust would be treated as plan assets for purposes of the
prohibited transaction rules under a U.S. Department of Labor regulation if
plans and individual retirement accounts purchase trust preferred securities,
unless an exception under the regulation applies. The only exception in the
regulation that could apply to the trust requires that after each purchase of
trust preferred securities in the trust, less than 25% of the total value of
the securities is held by:

(1) plans subject to ERISA, individual retirement accounts and plans for self-
employed persons;

(2) other employee benefit plans not subject to ERISA, such as governmental,
church and foreign plans; and

(3) entities which are considered to hold assets of a plan subject to ERISA
according to the regulation.

The plans, individual retirement accounts and entities described in clauses
(1), (2) and (3) are referred to as benefit plan investors. The underwriters
cannot be certain that benefit plan investors will hold less than 25% of the
total value of trust preferred securities when the initial offering is
completed. After that time, when a person sells trust preferred securities, no
one will review the securities held by benefit plan investors to determine if
the exception applies.

Some of the transactions involving the trust could be treated as prohibited
transactions if the trust's assets were considered to be plan assets. For
example, if we are a party in interest or a disqualified person with respect to
a plan or individual retirement account which buys trust preferred securities,
either directly or because we own banking or other subsidiaries, extensions of
credit from us and the trust would likely be prohibited transactions unless an
administrative exemption issued by the Department of Labor applies.

The Department of Labor has issued five class exemptions that may apply to
exempt transactions resulting from the purchase or holding of the trust
preferred securities. Those class exemptions are:

. 96-23, for transactions determined by in-house asset managers;

. 95-60, for transactions involving insurance company general accounts;

. 91-38, for transactions involving bank collective investment funds;

. 90-1, for transactions involving insurance company separate accounts; and

. 84-14, for transactions determined by independent qualified asset managers.

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

56
<PAGE>

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

Because the trust preferred securities may be treated as equity interests in
the trust for purposes of applying the prohibited transaction rules, the trust
preferred securities may not be purchased or held by any benefit plan investor,
unless such purchaser or holder can use one of the above class exemptions. By
purchasing or holding trust preferred securities or any interest in the trust
preferred securities, any purchaser or holder is deemed to have represented
that it either:

(1) is not a benefit plan investor; or

(2) can use one of the above class exemptions with respect to its purchase or
holding.

These rules are very complicated and the penalties that may be imposed upon
persons involved in prohibited transactions can be substantial. This makes it
very important that fiduciaries or other persons considering purchasing the
trust preferred securities on behalf of a benefit plan investor consult with
their lawyer regarding what could happen if the assets of the trust were deemed
to be plan assets and if the investor can use one of the above class exemptions
or another applicable exemption.

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57
<PAGE>

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

Underwriting

Based on the terms and conditions of an underwriting agreement, the trust has
agreed to sell to each of the underwriters named below, and each of the
underwriters has severally agreed to purchase from the trust the number of
trust preferred securities indicated in the following table. Warburg Dillon
Read LLC is the representative of the underwriters.

<TABLE>
<CAPTION>
Number of trust
preferred securities
- --------------------------------------------------------------------------------
<S> <C>
Warburg Dillon Read LLC...................................
-------
Total................................................... 200,000
=======
</TABLE>

The underwriters are obligated to take and pay for the total number of trust
preferred securities offered hereby if any such trust preferred securities are
purchased.

The obligations of the underwriters are subject to certain conditions precedent
and the underwriters must purchase all of the trust preferred securities if any
are purchased. The underwriters have agreed that, in the event of a default by
an underwriter, in certain circumstances, the purchase commitments of non-
defaulting underwriters may be increased or the underwriting agreement may be
terminated.

COMMISSIONS AND DISCOUNT

The underwriters propose to offer the trust preferred securities to the public
initially at the public offering price set forth on the cover page of this
prospectus. Any trust preferred securities sold by the underwriters to
securities dealers may be sold at a discount of up to . % of the liquidation
amount per capital security. Any of these securities dealers may resell any
trust preferred securities purchased from the underwriters to other brokers or
dealers at a discount of up to . % of the liquidation amount per capital
security. If all of the trust preferred securities are not sold at the initial
offering price, the representative may change the offering price and the other
selling terms.

Since the trust will use the proceeds from the sale of the trust preferred
securities to purchase our junior debentures, we have agreed to pay the
underwriters an underwriting commission of $. per capital security or a total
of $..

NO SALES OF SIMILAR SECURITIES

We and the trust have agreed with the underwriters not to offer, sell, contract
to sell or otherwise dispose of (1) any other trust preferred securities, (2)
any other securities of Riggs National Corporation, the trust or any other of
our subsidiaries that are substantially similar to the trust preferred
securities, including any guarantee of those securities, or (3) any securities
convertible into or exchangeable for any of these securities, in each case
except with the prior written consent of the representative and except for the
trust preferred securities offered in this offering. This restriction will
apply for 30 days from the date of this prospectus.

MARKET-MAKING ACTIVITIES

The trust preferred securities are a new issue of securities with no
established trading market. In connection with the offering, each of the
underwriters has advised us and the trust that it intends to make a market in
the trust preferred securities. However, the underwriters are not obligated to
do so and may discontinue any market making at any time without notice. We can
give no assurance as to the liquidity of the trading market for the trust
preferred securities.

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

58
<PAGE>

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

INTERESTS OF UNDERWRITERS

Certain of the underwriters or their affiliates have provided from time to
time, and expect to provide in the future, investment or commercial banking
services in the ordinary course of business to us and our affiliates. For these
services, the underwriters or their affiliates have received or will receive
customary fees and commissions.

PRICE STABILIZATION, SHORT POSITIONS AND PENALTY BIDS

In connection with the offering, the underwriters may purchase and sell trust
preferred securities in the open market. These transactions may include short
sales, stabilizing transactions and purchases to cover positions created by
short sales. Short sales involve the sale by the underwriters of a greater
amount of trust preferred securities than they are required to purchase in the
offering. Stabilizing transactions consist of certain bids or purchases made
for the purpose of preventing or retarding a decline in the market price of the
trust preferred securities while the offering is in progress.

The underwriters also may impose a penalty bid. This occurs when a particular
underwriter repays to the underwriters a portion of the underwriting
commissions received by it because the representatives have repurchased trust
preferred securities sold by or for the account of that underwriter in
stabilizing or short covering transactions.

These activities by the underwriters may stabilize, maintain or otherwise
affect the market price of the trust preferred securities. As a result, the
price of the trust preferred securities may be higher than the price that
otherwise might exist in the open market. If these activities are commenced,
the underwriters may discontinue them at any time.

INDEMNIFICATION AND CONTRIBUTION

We and the trust have agreed to (1) indemnify the underwriters against certain
liabilities, including civil liabilities under the Securities Act and (2)
contribute to any payments which the underwriters may be required to make in
that respect.

OFFERING EXPENSES

We estimate that the total expenses of the offering, excluding underwriting
discounts and commissions, will be approximately $520,000.

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59
<PAGE>

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

Validity of Securities

Richards, Layton & Finger, P.A., special Delaware counsel to us and the trust,
will pass upon certain matters of Delaware law relating to the validity of the
trust preferred securities, the enforceability of the amended trust agreement
and the creation of the trust. Sullivan & Cromwell, Washington, D.C., counsel
for us and the trust, and Simpson Thacher & Bartlett, New York, N.Y., counsel
for the underwriters, will each pass upon the validity of the guarantee and the
junior debentures. Sullivan & Cromwell will rely upon the opinion of Richards,
Layton & Finger, P.A., as to matters of Delaware law.

Sullivan & Cromwell, as tax counsel to us and the trust, will pass upon certain
matters relating to U.S. federal income tax considerations.

Experts

The audited consolidated financial statements included in the annual report on
Form 10-K for the year ended December 31, 1998 and incorporated by reference in
this prospectus and elsewhere in this registration statement have been audited
by Arthur Andersen LLP, independent public accountants, as indicated in their
reports with respect thereto, and are included herein in reliance upon the
authority of said firm as experts in giving said report.

Where You Can Find More Information

We file annual, quarterly and current reports, proxy statements and other
information with the Securities and Exchange Commission (the "SEC"). You may
also read and copy any document that we file at the
SEC's public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549.
Please call the SEC at
1-800-SEC-0330 for further information on the public reference room and their
copying charges. Our
filings with the SEC are also available to the public through the SEC's
Internet site at http://www.sec.gov. The trust will not file any reports or
other information with the SEC under the Securities Exchange Act of 1934.

We and the trust have filed a registration statement on Form S-3 with the SEC.
This prospectus is a part of the registration statement and does not contain
all of the information in the registration statement. Wherever a reference is
made in this prospectus to a contract or other document, please be aware that
the reference is not necessarily complete and that you should refer to the
exhibits that are a part of the registration statement for a copy of the
contract or other document. You may review a copy of the registration statement
at the SEC's public reference room in Washington, D.C. as well as through the
SEC's Internet site.

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60
<PAGE>

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

Incorporation of Information We File with the SEC

The SEC allows us to "incorporate by reference" the information we file with
the SEC, which means:

. incorporated documents are considered part of this prospectus;

. we can disclose important information to you by referring you to those
documents; and

. information that we file with the SEC that we incorporate by reference will
automatically be considered to update and supersede this prospectus.

We incorporate by reference the documents listed below and any future filings
made by us with the SEC under Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 if the filings are made before the time that
all of the trust preferred securities are sold in this offering:

. annual report on Form 10-K for the year ended December 31, 1998;

. quarterly report on Form 10-Q for the quarter ended March 31, 1999; and

. current reports on Form 8-K, filed on . , 1999.

You may request a copy of these filings at no cost by writing or telephoning us
at the following address:

Riggs National Corporation
1503 Pennsylvania Avenue, N.W.
Washington, D.C. 20005
Attention: Investor Relations
(202) 835-4309

You should rely only on the information incorporated by reference or provided
in this prospectus. Neither we nor the trust has authorized anyone else to
provide you with different information. Neither we nor the trust is making an
offer of these securities in any state where the offer is not permitted. You
should not assume that the information in this prospectus is accurate as of any
date other than the date of this prospectus or the date of the documents
incorporated by reference in this prospectus.

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61
<PAGE>

Through and including . , 1999 (the 25th day after the date of this
prospectus), all dealers effecting transactions in these securities, whether or
not participating in this offering, may be required to deliver a prospectus.
This is in addition to the dealers' obligation to deliver a prospectus when
acting as underwriters and with respect to their unsold allotments or
subscriptions.

We have not authorized any dealer, salesperson or other person to give any
information or represent anything not contained in this prospectus. You must
not rely on any unauthorized information. This prospectus does not offer to
sell or buy any securities in any jurisdiction where it is unlawful. The
information in this prospectus is current as of . , 1999.

PROSPECTUS

$200,000,000

Riggs Capital III

Floating Rate Trust Preferred Securities

Fully and Unconditionally Guaranteed by

[Logo]

Riggs National Corporation

Warburg Dillon Read LLC

<PAGE>

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

PART II.

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution.*

<TABLE>
<S> <C>
Registration fee under the Securities Act of 1933, as amended......... $ 55,600
Blue Sky fees and expenses (including counsel fees)................... 5,000
Fees of rating agencies............................................... 130,000
Trustees' fees and expenses........................................... 46,000
Printing fees and expenses............................................ 30,000
Accounting fees and expenses.......................................... 40,000
Legal fees and expenses............................................... 200,000
Miscellaneous......................................................... 13,400
--------
Total................................................................. $520,000
========
</TABLE>
*All of the above amounts, except the registration fee, are estimates.

Item 15. Indemnification of Directors and Officers.

Section 145 of the General Corporation Law of the State of Delaware, Article
Eleventh of the Corporation's Certificate of Incorporation and Section 14.1 of
the Corporation's Bylaws provide for indemnification of the Corporation's
directors and officers in a variety of circumstances which may include
liabilities under the Securities Act.

The general effect of the provisions in the Corporation's Certificate of
Incorporation and Delaware General Corporation Law is to provide that the
Corporation shall indemnify its directors and officers against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by them in connection with the defense or
settlement of any judicial or administrative proceedings in which they become
involved by reason of their status as directors or officers of the Corporation,
if they acted in good faith and in the reasonable belief that their conduct was
neither unlawful (in the case of criminal proceedings) nor inconsistent with
the best interests of the Corporation. With respect to legal proceedings by or
in the right of the Corporation in which a director or officer is adjudged
liable for improper performance of his duty to the Corporation or another
enterprise which he served in a similar capacity at the request of the
Corporation, indemnification is limited by such provisions to that amount which
is permitted by the court. Further, under Delaware Corporate Law,
indemnification is limited to expenses including attorneys fees;
indemnification for judgments, fines and amounts paid in settlement in a
derivative case is not permitted. In addition, the Corporation has purchased
insurance as permitted by Delaware law on behalf of directors, officers,
employees or agent, which may cover liabilities under the Securities Act.

In addition, Article Eleventh of the Corporation's Certificate of Incorporation
provides that no director of the Corporation will be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director. This provision does not eliminate or limit the liability of
a director for: (i) breach of the director's duty of loyalty to the Corporation
or its stockholders; (ii) acts or omissions not in good faith or that involve
intentional misconduct or a knowing violation of law; (iii) willful or
negligent conduct in paying illegal dividends or improperly purchasing or
redeeming the Corporation's own stock; or (iv) any transaction in which the
director obtains an improper personal benefit.

Item 16. Exhibits.

Reference is made to the Exhibit Index filed herewith.

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

II-1
<PAGE>

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

Item 17. Undertakings.

Each of the undersigned Registrants hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as amended, each
filing of a Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934, as amended, that is incorporated
by reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers and controlling persons of a registrant
pursuant to the foregoing provisions, or otherwise, each of the undersigned
Registrants has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against such public policy as expressed in
the Securities Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by a
registrant of expenses incurred or paid by a director, officer or controlling
person of a registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, each of the undersigned
Registrants will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.

Each of the undersigned Registrants hereby also undertakes:

(1) to provide to the underwriter at the closing specified in the
underwriting agreement certificates in such denominations and registered
in such names as required by the underwriter to permit prompt delivery
to each purchaser;

(2) that, for the purposes of determining any liability under the Securities
Act:

(i) The information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained
in a form of prospectus filed by the Registrants pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed
to be part of this Registration Statement as of the time it was
declared effective.

(ii) Each post-effective amendment that contains a form of prospectus
shall be deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.

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

II-2
<PAGE>

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

Signatures

Pursuant to the requirements of the Securities Act of 1933, as amended, Riggs
National Corporation certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Washington, District of Columbia, as
of the 16th day of June, 1999.

RIGGS NATIONAL CORPORATION

/s/ TIMOTHY C. COUGHLIN
By: ____________________________________________
Name: Timothy C. Coughlin
Title: President

Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
Title Date
----- ----
<S> <C> <C>
* Chairman of the Board and June 16, 1999
______________________________________ Chief Executive Officer
(Joe L. Allbritton)
/s/ TIMOTHY C. COUGHLIN President June 16, 1999
______________________________________
(Timothy C. Coughlin)
/s/ JOHN L. DAVIS Chief Financial Officer June 16, 1999
______________________________________ and Treasurer (Principal
(John L. Davis) Financial Officer)
/s/ ELEANOR L. RUTLAND Comptroller (Principal June 16, 1999
______________________________________ Accounting Officer)
(Eleanor L. Rutland)
* Director June 16, 1999
______________________________________
(Robert L. Allbritton)
Director
______________________________________
(John M. Fahey, Jr.)
* Director June 16, 1999
______________________________________
(Lawrence I. Hebert)
* Director June 16, 1999
______________________________________
(Steven B. Pfeiffer)
Director
______________________________________
(John E.V. Rose)
* Director June 16, 1999
______________________________________
(Robert L. Sloan)
</TABLE>

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

II-3
<PAGE>

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

<TABLE>
<CAPTION>
Title Date
----- ----
<S> <C> <C>
* Director June 16, 1999
______________________________________
(Jack Valenti)
Director
______________________________________
(William L. Walton)
* Director June 16, 1999
______________________________________
(Eddie N. Williams)
</TABLE>

*Joseph M. Cahill, by signing his name hereto, signs this document on behalf of
each of the persons indicated by an asterisk above pursuant to powers of
attorney duly executed by such persons and filed herewith with the Securities
and Exchange Commission.

/s/JOSEPH M. CAHILL
By: ___________________
Joseph M. Cahill
Attorney-in-fact

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

II-4
<PAGE>

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

Signatures

Pursuant to the requirements of the Securities Act of 1933, as amended, Riggs
Capital III certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Washington, District of Columbia, as of the
16th day of June, 1999.

RIGGS CAPITAL III

By: Riggs National Corporation, as Depositor

/s/ TIMOTHY C. COUGHLIN
By: ____________________________________________
Name: Timothy C. Coughlin
Title: President

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

II-5
<PAGE>

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

Exhibit Index

<TABLE>
<CAPTION>
Exhibit Description of Exhibit
- ----------------------------------------------------------------------------------
<C> <S>
1 Form of Underwriting Agreement**

4(a) Junior Subordinated Indenture, dated as of [ ], between Riggs
National Corporation and The Bank of New York, as Debenture Trustee
(Incorporated by reference to Exhibit 4(a) to Registration Statement
on Form S-4, Commission No. 333-[ ])**

4(b) Certificate of Trust of Riggs Capital III, dated as of [ ], 1999**

4(c) Trust Agreement of Riggs Capital III, dated as of [ ], 1999**

4(d) Form of Amended and Restated Trust Agreement of Riggs Capital III
(including the related form of Expense Agreement)**

4(e) Form of Trust Preferred Security Certificate (included in Exhibit 4(d))**

4(f) Form of Guarantee Agreement**

5(a) Opinion of Sullivan & Cromwell, as to validity of the Junior
Subordinated Deferrable Interest Debentures and the Guarantee**

5(b) Opinion of Richards, Layton & Finger, P.A., as to validity of the
Trust Preferred Securities**

8 Opinion of Sullivan & Cromwell as to certain federal income tax
matters**

12 Computations of Consolidated Ratios of Earnings to Fixed Charges
(Incorporated by reference to Exhibit 12 to Riggs National
Corporation's Annual Report on Form 10-K for the year ended December
31, 1998)**

23(a) Consent of Arthur Andersen LLP*

23(b) Consent of Sullivan & Cromwell (Included in Exhibit 5(a))**

23(c) Consent of Richards, Layton & Finger, P.A. (Included in Exhibit 5(b))**

23(d) Consent of Sullivan & Cromwell (Included in Exhibit 8)**

24 Powers of Attorney*

25 Form T-1 Statement of Eligibility of The Bank of New York to act as
trustee under the Indenture, under the Amended and Restated Trust
Agreement, and under the Guarantee for the benefit of holders of Trust
Preferred Securities**
</TABLE>
- ------
* Filed herewith
** To be filed by Amendment

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

<PAGE>

EXHIBIT 23(a)

ARTHUR ANDERSEN LLP

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the reference to our
firm in the Registration Statement Form S-3 and related Prospectus of Riggs
Capital III for the registration of Trust Preferred Securities and to the
incorporation by reference therein of our report dated January 20, 1999 with
respect to the consolidated financial statements of Riggs National Corporation
in its Annual Report (Form 10-K) for the year ended December 31, 1998, filed
with the Securities and Exchange Commission.

/s/ ARTHUR ANDERSEN LLP

Washington, D.C.
June 11, 1999

<PAGE>

EXHIBIT 24

RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY

----------

KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin and Joseph M. Cahill, individually, as my true and lawful
attorney-in-fact and agent to do any and all acts and to execute any and all
instruments which said attorney-in-fact may deem necessary or advisable to
enable the Corporation to comply with the Securities Act of 1933, as amended,
and any regulations promulgated thereunder (the "Securities Act") by the
Securities and Exchange Commission (the "Commission"), in connection with the
registration, offering and sale under the Securities Act of up to 200,000 shares
of Trust Preferred Securities, Series D liquidation preference $1,000.00 per
share, by the Corporation's Delaware Business Trust, Riggs Capital III with an
aggregate initial offering price of up to $200,000,000 and the registration,
offer and sale of up to $230,000,000 aggregate initial offering price of the
Corporation's Junior Subordinated Debentures, Series D (together with the Trust
Preferred Securities the "Securities"), including without limitation thereof,
the full power and authority to sign my name as a director and/or officer of the
Corporation to a Registration Statement on Form S-3 (the "Registration
Statement") or such other form for the registration of the Securities as the
Commission may require or said attorney-in-fact deem necessary or advisable
regarding such Securities and to any amendment (including, without limitation,
post-effective amendments) or supplements or a related registration statement to
said Registration Statement or statements, to the prospectus or prospectuses,
and I hereby ratify and confirm all that said attorney-in-fact agents shall do
or cause to be done, including any and all acts and things and any and all other
instruments, documents or agreements, including but not limited to the
Prospectus, the Indenture, the Trust Agreement, the Guarantee, the Expense
Agreement, the Underwriting Agreement and any other letter, contract, document
or agreement relating hereto which said attorney-in-fact may deem necessary or
advisable to enable the Corporation to accomplish and complete the transactions
contemplated in the resolution approved by the board of directors of the
Corporation and to withdraw any such filings or transactions if said
attorney-in-fact deems such withdrawal appropriate.

<PAGE>

IN WITNESS WHEREOF, I have hereunto set my hand this 10th day of June,
1999.

/s/ JOE L. ALLBRITTON
- ------------------------------- ------------------------------
Joe L. Allbritton, Chairman of the Board John E.V. Rose, Director
and Chief Executive Officer

/s/ ROBERT L. ALLBRITTON /s/ ROBERT L. SLOAN
- ------------------------------- ------------------------------
Robert L. Allbritton, Director Robert L. Sloan, Director

/s/ JACK VALENTI
- ------------------------------- ------------------------------
John M. Fahey, Jr., Director Jack Valenti, Director

/s/ LAWRENCE I. HEBERT
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Lawrence I. Hebert, Director William L. Walton, Director

/s/ STEVEN B. PFEIFFER /s/ EDDIE N. WILLIAMS
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Steven B. Pfeiffer, Director Eddie N. Williams, Director