FIRSTAR CORP /WI/, 10-K405, 1995-03-20

FIRSTAR CORP /WI/
10-K405, 1995-03-20
STATE COMMERCIAL BANKS

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 1994 Commission File Number 1-2981

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

FIRSTAR CORPORATION

WISCONSIN
(State of Incorporation)
39-0711710
(I.R.S. Employer Identification No.)

777 East Wisconsin Avenue, Milwaukee, Wisconsin 53202
Telephone Number (414) 765-4321

Securities Registered Pursuant to Section 12(b) of the Act:

<TABLE>
<CAPTION>
NAME OF EACH EXCHANGE ON
TITLE OF EACH CLASS WHICH REGISTERED
-------------------------------- --------------------------------
<S> <C>
Common Stock, $1.25 par value New York Stock Exchange, Inc.
Chicago Stock Exchange, Inc.
Preferred Stock, Series D Nasdaq
10% Notes due June 1, 1996 New York Stock Exchange, Inc.
Preferred Share Purchase Rights New York Stock Exchange, Inc.
Chicago Stock Exchange, Inc.
</TABLE>

Securities Registered Pursuant to Section 12(g) of the Act: None

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

Indicated by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. X Yes No

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. X

As of March 2, 1995, 72,861,171 shares of common stock were outstanding,
and the aggregate market value of the shares (based upon the closing price) held
by nonaffiliates was approximately $1.867 billion.

Documents Incorporated by Reference:

Portions of the 1995 Notice of Annual Meeting and Proxy Statement are
incorporated by reference into Part III of the Form 10-K.
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<PAGE> 2

FORM 10-K TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PART I
Item 1 - Business.................................................................. 2
Item 2 - Properties................................................................ 5
Item 3 - Legal Proceedings......................................................... 5
Item 4 - Submission of Matters to a Vote of Security Holders....................... 5
PART II
Item 5 - Market for the Registrant's Common Equity and Related Stockholder
Matters................................................................... 5
Item 6 - Selected Financial Data................................................... 6
Item 7 - Management's Discussion and Analysis of Financial Condition and Results of
Operations................................................................ 7
Item 8 - Financial Statements and Supplementary Data............................... 26
Item 9 - Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure................................................................ 56
PART III
Item 10 - Directors and Executive Officers of the Registrant........................ 56
Item 11 - Executive Compensation.................................................... 56
Item 12 - Security Ownership of Certain Beneficial Owners and Management............ 56
Item 13 - Certain Relationships and Related Transactions............................ 56
PART IV
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K........... 56
Signatures.......................................................................... 58
</TABLE>

1
<PAGE> 3

PART I

ITEM 1. BUSINESS

GENERAL

Firstar Corporation is a registered bank holding company incorporated in
Wisconsin in 1929. Firstar Corporation ("Firstar") is the largest bank holding
company headquartered in Wisconsin. Firstar's 15 bank subsidiaries in Wisconsin
had total assets of $10.0 billion at December 31, 1994. Its eleven Iowa banks,
one Illinois bank and one Minnesota bank had total assets of approximately $2.7
billion, $959 million and $1.2 billion, respectively, as of December 31, 1994.
Firstar has one bank in Phoenix, Arizona with total assets of $102 million.
Firstar's principal subsidiary, Firstar Bank Milwaukee, N.A., had total assets
of $6.0 billion which represented 40 percent of Firstar's consolidated assets at
December 31, 1994, and is the largest commercial bank in Wisconsin.

Firstar provides banking services throughout Wisconsin and Iowa and in
the Chicago, Minneapolis- St. Paul and Phoenix metropolitan areas. Its
Wisconsin bank subsidiaries operate in 135 locations, with offices in eight of
the ten largest metropolitan population centers of the state, including 74
offices in the Milwaukee metropolitan area. Its Iowa bank subsidiaries operate
in 43 locations; its Illinois bank subsidiaries in 15 locations; its Minnesota
bank subsidiary in 24 locations; its Arizona bank in three locations; and a
trust subsidiary in Florida in two locations. Firstar's bank subsidiaries
provide a broad range of financial services for companies based in Wisconsin,
Iowa, Illinois and Minnesota, national business organizations, governmental
entities and individuals. These commercial and consumer banking activities
include accepting demand, time and savings deposits; making both secured and
unsecured business and personal loans; and issuing and servicing credit cards.
The bank subsidiaries also engage in correspondent banking and provide trust
and investment management services to individual and corporate customers.
Firstar Milwaukee, N.A., Firstar Bank Cedar Rapids, N.A. and Firstar Bank
Madison, N.A. also conduct international banking services consisting of foreign
trade financing, issuance and confirmation of letters of credit, funds
collection and foreign exchange transactions. Nonbank subsidiaries provide
retail brokerage services, trust and investment management services,
residential mortgage banking activities, title insurance, business insurance,
consumer and credit related insurance, and corporate computer and operational
services.

At December 31, 1994, Firstar and its subsidiaries employed 7,680 full-time
and 2,196 part-time employees, of which approximately 970 full-time employees
are represented by a union under a collective bargaining agreement that expires
on August 31, 1996. Management considers its relations with its employees to be
good.

COMPETITION

Banking and bank-related services is a highly competitive business.
Firstar's subsidiaries compete primarily in Wisconsin and the Midwestern United
States. Firstar and its subsidiaries have numerous competitors, some of which
are larger and have greater financial resources. Firstar competes with other
commercial banks and financial intermediaries, such as savings banks, savings
and loan associations, credit unions, mortgage companies, leasing companies and
a variety of financial services and advisory companies located throughout the
country.

SUPERVISION

Firstar's business activities as a bank holding company are regulated by
the Federal Reserve Board under the Bank Holding Company Act of 1956 which
imposes various requirements and restrictions on its operations. The activities
of Firstar and those of its banking and nonbanking subsidiaries are limited to
the business of banking and activities closely related or incidental to banking.

The business of banking is highly regulated, and there are various
requirements and restrictions in the laws of the United States and the states in
which the subsidiary banks operate including the requirement to maintain
reserves against deposits and adequate capital to support their operations,
restrictions on the nature

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and amount of loans which may be made by the banks, restrictions relating to
investment (including loans to and investments in affiliates), branching and
other activities of the banks.

Firstar's subsidiary banks with a national charter are supervised and
examined by the Comptroller of the Currency. The subsidiary banks with a state
charter are supervised and examined by their respective state banking agency and
either by the Federal Reserve if a member bank of the Federal Reserve or by the
FDIC if a nonmember. All of the Firstar subsidiary banks are also subject to
examination by the Federal Deposit Insurance Corporation.

In recent years Congress has enacted significant legislation which has
substantially changed the federal deposit insurance system and the regulatory
environment in which depository institutions and their holding companies
operate. The Financial Institutions Reform, Recovery and Enforcement Act of 1989
("FIRREA"), the Comprehensive Thrift and Bank Fraud Prosecution and Taxpayer
Recovery Act of 1990 and the Federal Deposit Insurance Corporation Improvement
Act of 1991 ("FDICIA") have significantly increased the enforcement powers of
the federal regulatory agencies having supervisory authority over Firstar and
its subsidiaries. Certain parts of such legislation increase the cost of doing
business for depository institutions and their holding companies. FIRREA also
provides that all commonly controlled FDIC insured depository institutions may
be held liable for any loss incurred by the FDIC resulting from a failure of, or
any assistance given by the FDIC, to any of such commonly controlled
institutions. Federal regulatory agencies have implemented provisions of FDICIA
with respect to taking prompt corrective action when a depository institution's
capital falls to certain levels. Under the new rules, five capital categories
have been established which range from "critically undercapitalized" to "well
capitalized". Failure of a depository institution to maintain a capital level
within the top two categories will result in specific actions from the federal
regulatory agencies. These actions could include the inability to pay dividends,
restricting new business activity, prohibiting bank acquisitions, asset growth
limitations and other restrictions on a case by case basis.

In addition to the impact of regulation, commercial banks are affected
significantly by the actions of the Federal Reserve Board as it attempts to
control the money supply and credit availability in order to influence the
economy. Changes to such monetary policies have had a significant effect on
operating results of financial institutions in the past and are expected to have
such an effect in the future; however, the effect of possible future changes in
such policies on the business and operations of Firstar cannot be determined.

3
<PAGE> 5

EXECUTIVE OFFICERS OF THE REGISTRANT

The following is a list of all the executive officers (16) of Firstar as of
December 31, 1994. All of these officers are elected annually by their
respective boards of directors. All of the officers have been employed by
Firstar and/or one or more of its subsidiaries during the past five years,
except Mr. Schoenke, who was previously employed by another banking company and
joined Firstar as an executive officer in 1990. There are no family
relationships between any of the executive officers.

<TABLE>
<CAPTION>
NAME AGE POSITION
- ------------------------------------------ --- --------------------------------------------
<S> <C> <C>
Roger L. Fitzsimonds...................... 56 Chairman of the Board and Chief Executive
Officer of Firstar (Since February 1991)
John A. Becker............................ 52 President and Chief Operating Officer of
Firstar (Since January 1990)
Chris M. Bauer............................ 46 Chairman of the Board of Firstar Bank
Milwaukee (Since January 1991)
James R. Lang............................. 51 Chairman of the Board and President of
Firstar Corporation of Iowa (Since April
1991)
Ronald A. Bero............................ 59 Senior Executive Vice President of Firstar
(Since September 1989)
Michael J. Bills.......................... 51 Executive Vice President of Firstar
(Since April 1994)
Jay B. Williams........................... 43 President of Firstar Bank Illinois
(Since January 1995)
Richard W. Schoenke....................... 51 President of Firstar Bank of Minnesota
(Since July 1990)
Michael J. Schmitz........................ 60 Executive Vice President of Firstar
(Since October 1990)
Jon H. Stowe.............................. 50 Executive Vice President of Firstar
(Since January 1994)
Blaine E. Rieke........................... 61 Chairman of the Board of Firstar Trust
Company (Since November 1981)
William H. Risch.......................... 56 Senior Vice President-Finance & Treasurer of
Firstar (Since January 1984)
Dennis R. Fredrickson..................... 50 Senior Vice President of Firstar
(Since October 1988)
John R. Heistad........................... 48 Senior Vice President and Chief Credit
Officer of Firstar (Since January 1992)
Howard H. Hopwood III..................... 49 Senior Vice President and General Counsel of
Firstar (Since January 1986)
Ronald E. Roder........................... 46 Senior Vice President of Firstar Bank
Milwaukee (Since December 1988)
</TABLE>

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ITEM 2. PROPERTIES

On December 31, 1994, Firstar had 222 banking locations, of which 159 were
owned and 63 were leased. All of these offices are considered by management to
be well maintained and adequate for the purpose intended. See Note 7 of the
Notes to Consolidated Financial Statements included under Item 8 of this
document for further information on properties.

ITEM 3. LEGAL PROCEEDINGS

Firstar and its subsidiaries are subject to various legal actions and
proceedings in the normal course of business, some of which involve substantial
claims for compensatory or punitive damages. Although litigation is subject to
many uncertainties and the ultimate exposure with respect to these matters
cannot be ascertained, management does not believe that the final outcome will
have a material adverse effect on the financial condition of Firstar.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

See Item 6 of this document for information on stock price ranges and
dividends. The principal markets for the quotations of stock prices are the New
York Stock Exchange and Chicago Stock Exchange. There were 11,033 holders of
record of Firstar's $1.25 par value Common Stock on March 2, 1995.

5
<PAGE> 7

ITEM 6. SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
------------------------------------------------------------
1994 1993 1992 1991 1990
-------- -------- -------- -------- --------
(thousands of dollars, except per share)
<S> <C> <C> <C> <C> <C>
EARNINGS AND DIVIDENDS
Net interest revenue................. $597,586 $568,056 $539,152 $480,596 $429,954
Provision for loan losses............ 17,139 24,567 44,821 50,276 49,161
Other operating revenue.............. 335,235 342,265 300,767 272,535 248,301
Other operating expense.............. 604,925 587,744 557,566 515,536 464,800
Net income........................... 207,743 204,294 165,985 134,331 117,457
Per common share:
Net income......................... 3.22 3.15 2.62 2.14 1.82
Dividends.......................... 1.16 1.00 .80 .705 .635
Stockholders' equity............... 19.83 17.96 15.94 14.17 12.79
Average common shares (000's)........ 64,611 63,747 61,879 60,998 61,218
- ----------------------------------------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average assets............. 1.51% 1.59% 1.36% 1.16% 1.06%
Return on average common equity...... 16.97 18.61 17.43 15.85 14.83
Equity to assets..................... 8.65 8.38 7.96 7.44 7.03
Total risk-based capital............. 13.46 13.18 13.20 11.92 11.94
Net loan charge-offs as a percentage
of average loans................... .25 .25 .43 .47 .48
Nonperforming assets as a percentage
of loans and other real estate..... .58 .72 1.09 1.43 1.87
Net interest margin.................. 5.03 5.21 5.27 5.00 4.76
Efficiency ratio..................... 60.61* 62.56 64.04 65.50 65.40
Fee revenue as a percentage
of average assets.................. 2.43 2.66 2.46 2.33 2.20

<CAPTION>
- ----------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C> <C>
BALANCE SHEET AT DECEMBER 31
Total assets......................... $ 15,104 $ 13,794 $ 13,169 $ 12,309 $ 12,020
Securities........................... 3,391 2,834 2,864 2,870 2,642
Loans:
Commercial loans................... 5,978 5,306 4,803 4,556 4,426
Consumer loans..................... 3,850 3,678 3,308 2,989 2,920
Total loans..................... 9,828 8,984 8,111 7,545 7,346
Earning assets....................... 13,595 12,117 11,408 10,747 10,326
Deposits:
Core deposits...................... 10,719 10,793 10,524 9,629 9,180
Other deposits..................... 516 371 360 434 541
Total deposits.................. 11,235 11,164 10,884 10,063 9,721
Short-term borrowed funds............ 2,141 1,113 861 934 1,044
Long-term debt....................... 135 126 158 144 185
Stockholders' equity................. 1,307 1,156 1,048 916 844
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STOCK PRICE INFORMATION
High................................. $ 35 3/8 $ 37 1/4 $ 31 7/8 $24 7/16 $16 15/16
Low.................................. 25 1/8 29 3/8 23 1/8 12 3/4 11
Close................................ 26 7/8 30 3/4 31 1/2 24 1/8 14 1/8
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</TABLE>

* excludes check kiting loss

6
<PAGE> 8

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

HIGHLIGHTS

Firstar reported earnings in 1994 of $207.7 million, a 1.7% increase over
the $204.3 million earned in 1993. On a per common share basis, 1994 net income
increased 2.2% to $3.22 from $3.15 earned in 1993. In 1992, net income was
$166.0 million, or $2.62 per common share.

While net income has increased in 1994, the effect of a higher
stockholders' equity base reduced the return on equity in 1994. Return on
average common equity declined to 16.97% in 1994 compared with 18.61% in 1993
and 17.43% in 1992. Firstar has measured its performance against a peer group of
30 other bank holding companies ranging in asset size from $10 billion to $25
billion. Firstar has placed within the top 25% of this group as measured by the
return on equity for the past six years.

This slowdown in the momentum of improvement during 1994 reflects the
impact of a $22 million pre-tax charge against earnings taken in the second
quarter for a check kiting fraud. This loss reduced 1994 earnings per share by
20 cents. While this loss had an impact on Firstar's earning trends, Firstar's
overall financial soundness remained unaffected.

Return on average assets for 1994 was 1.51% compared with 1.59% in 1993 and
1.36% in 1992.

Major factors affecting underlying earnings during 1994 were:

- Net interest margin declined to 5.03% in 1994 from 5.21% in 1993. During
1992 the margin was 5.27%.

- Strong loan growth of 11.1% offset the effects of the decline in margins,
helping increase net interest revenue by 4.9%.

- The provision for loan losses was reduced further in 1994 reflecting the
lower level of nonperforming assets and related net loan charge-offs.

- Growth in major fee revenue businesses continued, with trust and
investment management fees up 7.0% and credit card revenue up 4.6% during
1994. These gains in fee revenue were, however, offset by reduced
mortgage banking revenues as a result of a market driven contraction in
origination volumes.

- Operating expenses declined by just under 1% during 1994 after excluding
the check kiting loss.

- These factors combined to improve Firstar's efficiency ratio to 60.6% in
1994 compared to 62.6% in 1993 and 64.0% in 1992.

Further reductions in nonperforming assets were realized in 1994. Total
nonperforming assets were $56.8 million at the end of the year, a reduction of
12.4% from year-end 1993. Nonperforming assets now represent .58% of total loans
and other real estate.

Stockholders' equity increased to $1.31 billion at the end of 1994. Market
capitalization was $1.77 billion. Capital strength, by all measures, remains
strong. Firstar's capital ratios are in the top quartile of its peer group and
it has the highest capital rating by its regulatory agency.

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<PAGE> 9

NET INTEREST REVENUE

Net interest revenue, which comprises interest and loan-related fees less
interest expense, is the principal source of earnings for Firstar. Net interest
revenue is affected by a number of factors including the level, pricing and
maturity of earning assets and interest-bearing liabilities, interest rate
fluctuations and asset quality. Net interest margin is net interest revenue
expressed as a percentage of average earning assets. To permit comparisons, net
interest revenue and margins in the accompanying discussion and tables have been
adjusted to show tax-exempt income, such as interest on municipal securities and
loans, on a taxable-equivalent basis. Table 1 shows the components of net
interest revenue, net income and net interest margin for the last three years.

TABLE 1

CONDENSED INCOME STATEMENTS -- TAXABLE-EQUIVALENT BASIS

<TABLE>
<CAPTION>
CHANGE FROM PRIOR YEAR
---------------------------------------
1994 VS 1993 1993 VS 1992
----------------- -----------------
1994 1993 1992 AMOUNT PERCENT AMOUNT PERCENT
------ ------ ------ ------ ------- ------ -------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C> <C>
Interest revenue.......................... $938.0 $867.0 $898.5 $71.0 8.2% $(31.5) (3.5)%
Taxable-equivalent adjustment............. 29.0 29.3 31.7 (.3) (1.0) (2.4) (7.6)
------ ------ ------ ------ ------
Interest revenue--taxable-equivalent.... 967.0 896.3 930.2 70.7 7.9 (33.9) (3.6)
Interest expense.......................... 340.4 298.9 359.4 41.5 13.9 (60.5) (16.8)
------ ------ ------ ------ ------
Net interest revenue--
taxable-equivalent.................... 626.6 597.4 570.8 29.2 4.9 26.6 4.7
Provision for loan losses................. 17.1 24.6 44.8 (7.5) (30.5) (20.2) (45.1)
Other operating revenue................... 335.2 342.2 300.8 (7.0) (2.0) 41.4 13.8
Other operating expense................... 604.9 587.7 557.6 17.2 2.9 30.1 5.4
------ ------ ------ ------ ------
Income before income taxes.............. 339.8 327.3 269.2 12.5 3.8 58.1 21.6
Provision for income taxes................ 103.1 93.7 71.5 9.4 22.2
Taxable-equivalent adjustment............. 29.0 29.3 31.7 (.3) (2.4)
------ ------ ------ ------ ------
Net income.............................. $207.7 $204.3 $166.0 $ 3.4 1.7 $38.3 23.1
====== ====== ====== ====== ======
Yield on earning assets................... 7.77% 7.82% 8.58% (.05)% (.76)%
Cost of interest-bearing liabilities...... 3.48 3.34 4.16 .14 (.82)
------ ------ ------ ------ ------
Interest spread........................... 4.29 4.48 4.42 (.19) .06
Impact of interest-free funds............. .74 .73 .85 .01 (.12)
------ ------ ------ ------ ------
Net interest margin..................... 5.03% 5.21% 5.27% (.18)% (.06)%
====== ====== ====== ====== ======
</TABLE>

Net interest revenue increased 4.9% to $626.6 million during 1994. This
follows a similar 4.7% increase in 1993. The growth in both years benefited from
higher average earning asset balances, driven principally by continued strong
loan growth. This positive impact was somewhat offset by a reduction in the net
interest margin, particularly in 1994.

The net interest margin for 1994 was 5.03% compared with 5.21% in 1993 and
5.27% in 1992. The margin declined moderately from the record high levels of the
prior two years. Interest rates increased dramatically during 1994 with the
prime rate rising from 6.00% at the beginning of the year to 8.50% at year-end.
Rates paid on fund sources increased by .14%, or 14 basis points, in 1994 as
more reliance was put on higher cost purchased funds. On the asset side, higher
rates earned on commercial loans was more than offset by declines in rates on
consumer lending and the securities portfolio, reducing the overall yield on
earning assets by five basis points. The impact of interest-free funds
supporting earning assets was not a factor in 1994 as shown by the one basis
point increase in margin attributable to these deposits. The level of earning
assets supported by interest-free funds was 21.3% in 1994 compared with 21.8% in
1993 and 20.4% in 1992. The six basis point decline in net interest margin
during 1993 resulted from the reduced benefit of interest-free funds partially
offset by a modest increase in the interest spread reflecting the general
decline in interest rates during that period. Firstar expects that further
reductions in its net interest margin are likely as interest rates stabilize or

8
<PAGE> 10

increase moderately from current levels. Firstar remains within the top quartile
of its peer group with respect to net interest margin.

Foregone interest on nonperforming loans and other real estate reduced net
interest revenue by $3.8 million in 1994, $4.6 million in 1993 and $8.3 million
in 1992. This resulted in corresponding reductions in net interest margin of
.03% in 1994 and .03% in 1993 and .05% in 1992. The nominal impact is a
reflection of Firstar's continued low level of nonperforming assets.

Table 2 shows the components of interest revenue and expense along with
changes related to volumes and rates. Total interest revenue increased by 7.9%
to $967.0 million. This resulted from higher average earning assets, up 8.6%,
which was partially offset by the slightly lower yield on earning assets.
Interest income on commercial loans rose by 16.3% due to both higher balances
and interest rates. Consumer loan interest, while up 4.5%, was impacted by the
lower net interest rate which was 47 basis points less than 1993. This reduced
rate on consumer loans reflects the refinancing activity and general lower rates
available late in 1993. Securities income has declined as higher rate
investments have matured and were replaced with securities with currently lower
market yields. During 1993, total interest revenue declined by 3.6%, to $896.3
million. This resulted from lower overall interest rates, which was partially
offset by the 5.7% increase in average earning assets. The rate received on
earning assets declined from 8.58% in 1992 to 7.82% in 1993.

TABLE 2

ANALYSIS OF INTEREST REVENUE AND EXPENSE

<TABLE>
<CAPTION>
1994 VS 1993 1993 VS 1992
---------------------------- -----------------------------
INTEREST DUE TO DUE TO
------------------------------ TOTAL ------------------ TOTAL ------------------
1994 1993 1992 CHANGE VOLUME RATE CHANGE VOLUME RATE
-------- -------- -------- ------- ------- -------- -------- ------- --------
(thousands of dollars)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Interest-bearing
deposits with banks... $ 288 $ 1,385 $ 2,608 $(1,097) $(1,501) $ 404 $ (1,223) $(1,441) $ 218
Federal funds sold and
resale agreements..... 8,841 4,602 9,791 4,239 1,941 2,298 (5,189) (4,138) (1,051)
Trading securities...... 1,560 985 1,012 575 307 268 (27) 111 (138)
Securities.............. 187,783 197,373 215,586 (9,590) 2,076 (11,666) (18,213) 6,221 (24,434)
Commercial loans........ 448,190 385,322 382,129 62,868 46,871 15,997 3,193 33,766 (30,573)
Consumer loans.......... 320,347 306,658 319,102 13,689 30,122 (16,433) (12,444) 27,327 (39,771)
-------- -------- -------- ------- --------
Total loans......... 768,537 691,980 701,231 76,557 77,045 (488) (9,251) 61,111 (70,362)
-------- -------- -------- ------- --------
Total interest
revenue........... 967,009 896,325 930,228 70,684 76,824 (6,140) (33,903) 51,334 (85,237)
Interest-bearing
demand................ 18,173 23,666 31,977 (5,493) (231) (5,262) (8,311) 3,105 (11,416)
Money market accounts... 44,416 38,968 49,555 5,448 659 4,789 (10,587) 548 (11,135)
Savings passbook........ 36,112 38,214 40,247 (2,102) 1,296 (3,398) (2,033) 7,306 (9,339)
Certificates of
deposit............... 163,427 160,786 199,626 2,641 4,177 (1,536) (38,840) (7,287) (31,553)
-------- -------- -------- ------- --------
Total deposits...... 262,128 261,634 321,405 494 4,530 (4,036) (59,771) 8,359 (68,130)
Short-term borrowed
funds................. 65,408 23,811 23,423 41,597 26,627 14,970 388 4,028 (3,640)
Long-term debt.......... 12,865 13,453 14,541 (588) (634) 46 (1,088) (1,026) (62)
-------- -------- -------- ------- --------
Total interest
expense........... 340,401 298,898 359,369 41,503 28,707 12,796 (60,471) 13,049 (73,520)
-------- -------- -------- ------- --------
Net interest
revenue........... $626,608 $597,427 $570,859 $29,181 50,243 (21,062) $ 26,568 31,715 (5,147)
========= ========= ========= ======== =========
</TABLE>

- ------------
Calculations are computed on a taxable-equivalent basis using a tax rate of 35%
in 1994 and 1993 and 34% in 1992.

The change attributable to both volume and rate has been allocated
proportionately to the changes due to volume and rate.

Total interest expense increased by 13.9% in 1994, to $340.4 million.
Interest expense on deposits increased modestly with the impact of deposit
growth being offset by lower interest rates paid in most categories of deposits.
The cost of short-term borrowed funds increased 175% with both higher usage of
this funding source and increased interest rates. The interest rate on
liabilities increased from 3.34% in 1993 to 3.48% in 1994. During 1993, total
interest expense declined by 16.8% to a level of $298.9 million. The interest
rates on liabilities was reduced from 4.16% in 1992 to 3.34% in 1993.

9
<PAGE> 11

OTHER OPERATING REVENUE

Total other operating revenue amounted to $335.2 million, a decrease of
$7.0 million or 2.1% from 1993. Excluding the impact of mortgage origination
revenues, other operating revenue rose by 1.5% in 1994 and 10.3% in 1993. This
growth reflects the continuing effort to emphasize non-interest revenue. This
focus provides several benefits to Firstar. Much of Firstar's fee revenue is not
subject to the fluctuations that are inherent in the interest rate cycle.
Firstar's broad customer base provides opportunities for expanded revenues as
the marketplace looks to financial institutions for services beyond traditional
lending and deposit activities. Table 3 shows the composition of other operating
revenue.

TABLE 3

ANALYSIS OF OTHER OPERATING REVENUE

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
--------------------------------------------------------
1994 1993 1992 1991 1990
-------- -------- -------- -------- --------
(thousands of dollars)
<S> <C> <C> <C> <C> <C>
Trust and investment management fees...... $117,872 $110,185 $ 95,926 $ 80,813 $ 70,051
Service charges on deposit accounts....... 72,366 74,071 66,301 59,368 50,250
Credit card service revenue............... 55,779 53,316 51,867 54,594 51,562
Data processing fees...................... 20,263 21,431 24,215 24,286 24,348
Mortgage servicing........................ 8,100 7,192 4,781 4,955 3,959
Mortgage originations..................... 6,953 18,966 7,591 2,258 1,562
-------- -------- -------- -------- --------
Mortgage banking revenue 15,053 26,158 12,372 7,213 5,521
Insurance revenue......................... 11,631 10,410 8,440 7,643 7,147
Brokerage revenue......................... 6,947 8,718 6,135 3,012 2,113
International fees........................ 5,854 5,234 5,151 4,712 4,476
Electronic funds transfer fees............ 4,234 3,678 3,135 2,849 2,732
Safe deposit fees......................... 3,394 3,323 3,237 3,136 3,058
Foreign exchange gains.................... 2,041 1,877 1,752 1,370 667
Municipal finance fees.................... 991 1,368 1,153 937 1,222
Trading securities gains.................. 139 2,074 1,802 1,579 1,559
Securities gains.......................... 76 182 981 1,619 117
Other..................................... 18,595 20,240 18,300 19,404 23,478
-------- -------- -------- -------- --------
Total................................... $335,235 $342,265 $300,767 $272,535 $248,301
======== ======== ======== ======== ========
</TABLE>

Other operating revenue now represents 35% of Firstar's revenue. An
industry measure of fee revenue prominence is the ratio of this revenue stream
to average assets. During 1994 this ratio was 2.43% compared to 2.66% in 1993
and 2.46% in 1992. These figures place Firstar sixth among the 30 banking
organizations with total assets of $10 billion to $25 billion.

Trust and investment management fees are the single largest source of fee
revenue, contributing $117.9 million, over one-third of other operating revenue.
This level represents a 7.0% growth in revenue in 1994 which in turn followed a
14.9% rise in the previous year. The development and addition of new business
was a factor in both years. Additionally, the reduction in the market value of
assets resulting from general market conditions, restricted the growth in
revenue during 1994. Expanded services are being offered through Firstar's
banking network. Additional marketing efforts are also being directed to
institutional investors beyond the Midwest. The introduction of fifteen
proprietary mutual funds and the serving as custodian/transfer agent for 175
publicly registered mutual funds have enhanced trust revenues. Trust assets
under management increased by 1.9% during 1994 to $15.1 billion at the end of
the year. Additional assets held in custody accounts were $38.5 billion.

Revenue from service charges on deposit accounts declined by 2.3% in 1994,
to a level of $72.4 million. This reduction was primarily due to higher rate
credits given to business customers for services, thus reducing

10
<PAGE> 12

the level of cash payments necessary. The opposite trend was evident in 1993,
where the lower rate environment generated increased cash payments for services
and increased service charge revenue by 11.7%.

Credit card service revenues are the third largest source of fee revenue
totaling $55.8 million during 1994, which was a 4.6% increase over 1993. This
follows a 2.8% increase the previous year. The introduction of new credit card
products and growth in merchant fee activity have aided in the revenue growth of
the past two years. Firstar services 570,000 active card holders, has 33,300
merchant accounts and provides credit card programs to more than 750 financial
institutions. This customer base, which covers the Upper Midwest and includes
Wisconsin, Iowa, Illinois, Minnesota, Upper Michigan, Nebraska and the Dakotas,
provides a market for the sale and expansion of other financial products.

Data processing fee income declined 5.5% in 1994 and 11.5% in 1993. A
shrinking customer base due to continuing bank consolidations through mergers or
acquisitions and conversions by smaller community banks to in-house data
processing systems have acted to reduce revenues. Intense price competition has
also occurred due to the shrinking market for sales and has affected revenue
levels through pricing changes and some loss of customers.

Revenue from mortgage banking activities has fluctuated dramatically during
the last three years as a result of the refinancing boom which peaked in 1993.
Revenue from mortgage originations reached $19.0 million in 1993, an increase of
$11.4 million over 1992 and then declined by $12.0 million during 1994. Mortgage
origination volume was $1.5 billion in 1993 and declined by one third to $1.0
billion in 1994. Mortgage loan servicing revenue has shown continued increases
during this period, increasing 50% in 1993 and 13% in 1994. Mortgage loans
serviced for others were $2.5 billion at the end of 1994, a 25% increase from a
year earlier. Firstar has expanded its mortgage banking activities through
coordinated marketing efforts within Firstar's banking network.

The past two years saw continued growth in insurance activity, with a 11.7%
increase in 1994 to $11.6 million, compared with a 23.3% increase during 1993.
This line of business generates revenue from the sale of annuities and insurance
products and represents an important element in Firstar's strategy to
continually expand fee revenue.

Brokerage revenue declined by 20.3% during 1994 to $6.9 million, as a
result of the generally unfavorable market conditions. This followed a very
strong growth in the prior two years.

The remaining sources of other operating revenue, excluding securities
transactions and other nonrecurring revenue, derive from a wide range of
services and collectively increased by 4.1% in 1994 and 3.0% in 1993.

11
<PAGE> 13

OTHER OPERATING EXPENSES

Total operating expenses increased 2.9% to $604.9 million in 1994 compared
with an increase of 5.4% in 1993. Excluding the impact of a check kiting fraud,
operating expenses declined by just under 1% during 1994. Information on the
components of other operating expense is shown in Table 4.

TABLE 4
ANALYSIS OF OTHER OPERATING EXPENSE

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
--------------------------------------------------------
1994 1993 1992 1991 1990
-------- -------- -------- -------- --------
(thousands of dollars)
<S> <C> <C> <C> <C> <C>
Salaries.................................. $265,731 $257,405 $237,997 $221,780 $205,082
Employee benefits......................... 60,175 59,443 49,610 44,977 40,489
-------- -------- -------- -------- --------
Total personnel expense................. 325,906 316,848 287,607 266,757 245,571
Equipment expense......................... 49,251 48,139 48,720 42,483 39,774
Net occupancy expense..................... 45,914 48,731 44,408 42,252 35,708
F.D.I.C. insurance........................ 23,789 23,670 22,488 19,325 10,360
Business development...................... 23,503 24,063 23,055 20,883 16,960
Stationery and supplies................... 16,456 19,060 18,123 16,767 15,591
Information processing expense............ 16,233 14,996 14,544 14,836 14,048
Professional fees......................... 14,958 15,336 14,040 14,688 15,431
Delivery.................................. 14,585 15,452 15,840 15,149 13,141
Amortization of intangibles............... 8,318 12,717 15,520 8,676 9,006
Employee education/recruiting............. 7,553 7,730 5,982 4,258 4,224
Commissions and service fees.............. 5,387 4,631 6,264 4,330 4,021
Wire communication........................ 5,246 4,586 4,411 4,250 4,246
Federal Reserve processing fees........... 4,478 5,033 5,370 4,992 5,210
Credit card assessment fees............... 4,209 3,851 3,475 3,133 2,739
Processing and other losses............... 3,550 3,972 3,314 3,222 2,713
Published information..................... 2,053 2,051 2,216 2,099 2,253
Insurance................................. 1,175 1,240 1,211 1,510 1,867
Net other real estate (income) expense.... (1,489) 2,056 4,303 10,537 9,837
Check kiting loss......................... 22,000
Other..................................... 11,850 13,582 16,675 15,389 12,100
-------- -------- -------- -------- --------
Total nonpersonnel expense.............. 279,019 270,896 269,959 248,779 219,229
-------- -------- -------- -------- --------
Total other operating expense........... $604,925 $587,744 $557,566 $515,536 $464,800
======== ======== ======== ======== ========
</TABLE>

Personnel costs, which include salaries and fringe benefits, are the
largest component of operating expenses, representing more than one-half of
operating costs. This expense rose by 2.9% in 1994 compared with 10.2% in 1993.
Salaries rose by 3.2% in 1994 and 8.2% in 1993. The salary increase during 1994
was limited to the effect of merit increases. Full-time equivalent employees
remained, for the most part, level during the year. One-half of the 1993
increase in salaries was attributed to bank acquisitions.

Employee benefit costs rose by only 1.2% in 1994 after increasing 19.8% in
1993. Firstar adopted Statement of Financial Accounting Standards No. 106,
"Accounting for Postretirement Benefits Other Than Pensions" in 1993. The
statement requires employers to recognize postretirement benefits on an accrual
basis over employee service periods, as contrasted to the expensed-as-incurred
method of accounting. Excluding the impact of Statement No. 106, which increased
costs by $7.0 million, employee benefit costs rose by 5.7% during 1993.

12
<PAGE> 14

Equipment expense increased by 2.3% in 1994 compared to a decline of 1.2%
in 1993. Firstar continues to invest in upgraded data processing equipment,
ensuring that its data processing capabilities are up-to-date in order to
provide quality service in a cost effective manner.

Net occupancy expense declined by 5.8% in 1994 reflecting the impact of a
partial acceleration of a deferred gain on a building sale of $2.1 million in
1994. Also affecting comparison between years was the costs associated with
office closings of $2.2 million in 1993 and $1.5 million in 1992.

FDIC insurance is an uncontrollable cost, with the premium established by
the federal regulatory agency. The FDIC sets varying premium amounts based upon
capitalization levels and soundness criteria. Firstar's capital strength has
permitted payments at the lowest rate levels. The FDIC is currently considering
reducing the premium levels which could result in a significant reduction in
Firstar's cost of FDIC insurance.

The amortization of intangibles includes amounts associated with goodwill,
core deposit intangibles and purchased mortgage loan servicing rights. During
1993 and 1992, additional amortization of mortgage servicing rights was taken
due to the high volume of the underlying mortgage loans which were refinanced.
Expense associated with the amortization of mortgage servicing rights was $.7
million in 1994, $5.2 million in 1993 and $8.3 million in 1992. This expense
fluctuates with changing interest rates and loan prepayment trends. The
remaining unamortized mortgage loan servicing rights were $4.7 million at the
end of 1994.

Net other real estate operations produced income of $1.5 million in 1994 as
a result of gains realized on the sale of properties. This contrasts to net
expenses of $2.1 million in 1993 and $4.3 million in 1992. The current low level
of other real estate held should continue to be reflected in reduced expenses.

The $22 million check kiting loss was recorded in the second quarter of
1994 when it was discovered that two affiliated commercial customers were
involved in a series of fraudulent check transactions. The customers are in
bankruptcy proceedings and although Firstar is pursuing its legal rights, there
is no assurance of any recovery.

All other expenses include a wide range of items and were decreased by 3.2%
in 1994 and increased by less than 1% in 1993.

A measure of the success in managing operating expense is expressed in the
ratio of expense to revenue and is referred to as the efficiency ratio. The
objective is to reduce this ratio through revenue growth, cost control or a
combination of both. Excluding the check kiting loss, this ratio was 60.6% in
1994, 62.6% in 1993 and 64.0% in 1992 and placed Firstar above the median level
of its peer companies. Firstar continues to seek ways to improve its efficiency
with a goal of operating at a 60% level in 1995.

PROVISIONS FOR LOAN LOSSES

The provision for loan losses is used to cover actual loan losses and to
adjust the size of the reserve relative to the amount and quality of loans. In
determining the adequacy of the reserve, management considers the financial
strength of borrowers, loan collateral, current and anticipated economic
conditions and other factors. The 1994 provision for loan losses was $17.1
million, compared with $24.6 million in 1993 and $44.8 million in 1992. The
reduced level of nonperforming assets and lower net charge-offs have permitted
Firstar to reduce its provision for loan losses.

INCOME TAXES

Income tax expense was $103.0 million in 1994, compared to $93.7 million in
1993 and $71.5 million in 1992. The effective tax rate was 33.1% in 1994, 31.4%
in 1993 and 30.1% in 1992. The effective tax rate rose in 1994 as compared to
1993 due to a reduction in tax-exempt municipal interest income, an increase in
state tax expense and the benefit of the adoption of Statement No. 109 in 1993.
The effective tax rate rose in 1993 compared to 1992 due to a 1% increase in the
federal corporate tax rate.

13
<PAGE> 15

BALANCE SHEET ANALYSIS

Changes in the balance sheet of a financial institution reflect both the
forces of the marketplace and the company's response to these conditions.
Firstar's strategy in managing balance sheet growth is based upon the goals of
enhancing soundness and providing a broad range of services for customers.

Total assets at the end of 1994 reached $15.1 billion, an increase of $1.3
billion or 9.5% over a year earlier. Approximately one third of this increase
was attributable to a bank acquisition. Average total assets for 1994 were $13.8
billion, an increase of 7.3% over 1993.

Table 5 shows the geographic distribution of Firstar's banking assets.
Firstar has expanded beyond its Wisconsin base through select acquisitions.
Assets outside of Wisconsin now represent 34% of consolidated assets. Firstar's
acquisition activity will focus on attractive markets in the upper Midwest that
will complement the existing Firstar banking network. The combination of
internal growth and acquisitions provides new opportunities to build and
diversify Firstar's earnings within an economically stable region.

TABLE 5

SUBSIDIARY AVERAGE ASSETS

- ------------
Assets have been adjusted for intercompany amounts.

Significant acquisition activity occurred during 1994. Firstar announced
three merger agreements in the third quarter of the year which will add to its
existing franchises.

The merger with First Colonial Bankshares Corporation, a $1.8 billion bank
holding company with 30 offices in the Chicago area was announced in July. The
transaction was completed on January 31, 1995, and, along with its existing
Illinois locations, gives Firstar a $3 billion banking franchise with 45 offices
in the Chicago area market.

In August, a second major acquisition was announced. This, with Investors
Bank Corp., a $1.1 billion thrift with 12 offices and a large mortgage banking
business in the Minneapolis/St. Paul market, will double both the size of
Firstar's Minnesota banking operations and corporate wide mortgage banking
business. This transaction should be completed in the second quarter of 1995.

A third pending acquisition will add $80 million of assets to Firstar Bank
Davenport through the acquisition of First Moline Financial Corp. of Moline,
Illinois. Also, the previously announced acquisition of First Southeast Banking
Corporation was completed in the fourth quarter of 1994, adding over $400
million of assets to Firstar's southeast Wisconsin banking franchise.

14
<PAGE> 16

LOANS AND INVESTMENTS

Earning assets, shown in Table 6, averaged $12.4 billion, an increase of
$988 million, or 8.6% over 1993. Loans, the largest category of earning assets,
represented 74.4% of earning assets as compared with 72.7% in 1993. On average,
loans totaled $9.3 billion, an increase of $928 million or 11.1% over 1993.
Excluding the impact of loans added through bank acquisitions, average loans
grew by 10.0%. This followed a 5.1% increase in average loans in 1993. This
growth was especially strong in the Wisconsin (excluding the lead bank) and
Minnesota markets which recorded loan growth in excess of 18%. The Iowa banks
and the lead bank located in Milwaukee showed loan growth in the 7-8% range.
Firstar expects this trend of increased loan demand to continue into 1995.

TABLE 6
AVERAGE EARNING ASSETS

<TABLE>
<CAPTION>
1994 1993 1992
-------------------- -------------------- --------------------
AMOUNT PERCENT AMOUNT PERCENT AMOUNT PERCENT
--------- ------- --------- ------- --------- -------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C>
Commercial and industrial.......... $ 2,554.0 20.5% $ 2,287.4 20.0% $ 2,003.7 18.5%
Real estate........................ 2,086.3 16.8 1,860.7 16.2 1,711.7 15.8
Foreign............................ 29.1 .2 21.9 .2 19.6 .2
Other.............................. 850.2 6.8 766.6 6.7 784.8 7.2
--------- ------- --------- ------- --------- -------
Commercial loans.............. 5,519.6 44.3 4,936.6 43.1 4,519.8 41.7
Credit card........................ 508.6 4.1 500.9 4.4 520.6 4.8
Real estate--mortgage.............. 1,396.5 11.2 1,291.1 11.3 1,197.1 11.0
Home equity........................ 471.0 3.8 416.5 3.6 325.2 3.0
Other.............................. 1,365.7 11.0 1,187.9 10.3 1,072.3 9.9
--------- ------- --------- ------- --------- -------
Consumer loans................ 3,741.8 30.1 3,396.4 29.6 3,115.2 28.7
--------- ------- --------- ------- --------- -------
Total loans................... 9,261.4 74.4 8,333.0 72.7 7,635.0 70.4
Securities held to maturity........ 2,949.1 23.7 2,929.0 25.6 2,845.0 26.2
Securities available for sale...... 11.0 .1
Trading securities................. 22.1 .2 17.3 .1 15.5 .2
Interest-bearing deposits with
banks............................ 4.9 33.0 .3 67.9 .6
Federal funds sold and resale
agreements....................... 200.1 1.6 147.8 1.3 277.1 2.6
--------- ------- --------- ------- --------- -------
Total......................... $12,448.6 100.0% $11,460.1 100.0% $10,840.5 100.0%
======== ===== ======== ===== ======== =====
</TABLE>

Commercial loans, which account for 60% of the loan portfolio, increased by
$583 million, or 11.8% on average, to $5.5 billion during 1994. Excluding bank
acquisitions which occurred during the past two years, commercial loans have
increased by 10.4%. This follows the 7.0% growth achieved in 1993.

Consumer loans averaged $3.7 billion, an increase of $345 million or 10.2%
over 1993. Excluding the affect of acquisitions, consumer loans rose by 9.3%.
Increased levels of mortgage loans and installment debt aided in this growth.
The lower interest rates available in 1993 and early 1994 prompted increased
consumer debt assumption. Credit card balances reversed the previous downward
trend in 1994, increasing by 1.5% in 1994. Firstar's new cards offering variable
rates and rebates have been well accepted and should result in continued loan
growth.

Firstar securitized $290 million of residential mortgage loans at the end
of 1994. These loans, now carrying a U.S. agency guarantee, are included in
securities held to maturity. This action gives Firstar increased liquidity
through the ability to borrow funds using repurchase agreements collateralized
by the securitized loans.

15
<PAGE> 17

Total securities, including both held to maturity and available for sale
securities, represent 24% of earning assets. They averaged $3.0 billion during
1994, an increase of $31 million, or 1.1% over 1993. Tables 7 and 8 show the
maturity range and changing mix of the investment portfolio. The average
maturity of the portfolio was 3.3 years as of the end of 1994.

TABLE 7
MATURITY RANGE AND AVERAGE YIELD OF SECURITIES

<TABLE>
<CAPTION>
DUE WITHIN FIVE TO TEN TOTAL
ONE YEAR ONE TO FIVE YEARS YEARS AFTER TEN YEARS DECEMBER 31, 1994
--------------- ----------------- --------------- --------------- -----------------
AMOUNT RATE AMOUNT RATE AMOUNT RATE AMOUNT RATE AMOUNT RATE
-------- ---- ---------- ---- -------- ---- -------- ---- ---------- ----
(thousands of dollars)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Securities held to
maturity:
U.S. Treasury and federal
agencies............... $212,217 7.24% $1,102,784 5.15% $142,707 7.51% $ % $1,457,708 5.69%
Mortgage backed
obligations of federal
agencies............... 107,295 7.68 330,871 7.56 230,827 7.49 169,172 7.06 838,165 7.42
State and political
subdivisions........... 191,022 7.37 443,953 7.48 234,586 7.99 22,319 9.10 891,880 7.63
Corporate debt........... 37,706 6.61 14,632 7.11 2,275 7.18 687 7.85 55,300 6.80
Other.................... 63,452 3.95 63,452 3.95
-------- ---------- -------- -------- ----------
Subtotal............. $611,692 6.98 $1,892,240 6.13 $610,395 7.69 $192,178 7.30 $3,306,505 6.65
========= ========== ========= =========
Equity securities........ 33,406 7.59
----------
Total................ $3,339,911 6.66
==========
Securities available for
sale:
U.S. Treasury and federal
agencies............... $ % $ 7,797 6.78% $ 30,089 7.44% $ % $ 37,886 7.30%
Mortgage backed
obligations of federal
agencies............... 1,143 5.02 6,799 5.75 850 5.64 1,988 5.21 10,780 5.55
State and political
subdivisions........... 563 5.63 1,582 6.37 497 6.95 2,642 6.32
-------- ---------- -------- -------- ----------
Total................ $ 1,706 5.22 $ 16,178 6.31 $ 31,436 7.38 $ 1,988 5.21 $ 51,308 6.89
========= ========== ========= ========= ==========
</TABLE>

- ------------
Rates are calculated on a taxable-equivalent basis using a tax rate of 35%. The
maturity information on mortgage-backed obligations is based on anticipated
payments.

TABLE 8
SECURITIES

<TABLE>
<CAPTION>
DECEMBER 31
------------------------------------------------------------------
1994 1993 1992 1991 1990
---------- ---------- ---------- ---------- ----------
(thousands of dollars)
<S> <C> <C> <C> <C> <C>
Securities held to maturity:
U.S. Treasury and federal agencies......... $1,457,708 $1,410,917 $1,131,715 $1,183,770 $1,247,864
Mortgage backed obligations of federal
agencies................................. 838,165 332,737 385,215 410,826 395,186
State and political subdivisions........... 891,880 905,396 952,377 885,349 779,290
Corporate debt............................. 55,300 70,494 244,821 287,326 195,171
Equity securities.......................... 33,406 13,745 13,713 10,968 10,224
Other...................................... 63,452 101,016 136,174 92,019 13,968
---------- ---------- ---------- ---------- ----------
Total.................................. $3,339,911 $2,834,305 $2,864,015 $2,870,258 $2,641,703
========== ========== ========== ========== ==========
Securities available for sale:
U.S. Treasury and federal agencies......... $ 37,886
Mortgage backed obligations of federal
agencies................................. 10,780
State and political subdivisions........... 2,642
----------
Total.................................. $ 51,308
==========
</TABLE>

16
<PAGE> 18

Short-term investments, which include interest-bearing deposits with banks,
trading account securities, and federal funds sold and resale agreements,
averaged $227 million in 1994, an increase of $29 million, or 14.6%, from a year
earlier.

FUND SOURCES

Average fund sources, consisting of deposits and borrowed funds, increased
by $838 million, or 7.3%, to $12.3 billion in 1994. Total deposits averaged
$10.7 billion, an increase of $142 million, or 1.3%. Bank acquisitions accounted
for most of this increase in average deposits. Table 9 shows the composition of
Firstar's fund sources.

TABLE 9

AVERAGE FUND SOURCES

<TABLE>
<CAPTION>
1994 1993 1992
-------------------- -------------------- --------------------
AMOUNT PERCENT AMOUNT PERCENT AMOUNT PERCENT
--------- ------- --------- ------- --------- -------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C>
Transaction accounts.................. $ 3,946.1 32.0% $ 3,949.9 34.4% $ 3,604.1 32.9%
Savings passbook...................... 1,542.0 12.5 1,490.2 13.0 1,239.4 11.3
Money market accounts................. 1,580.9 12.8 1,555.5 13.5 1,538.3 14.1
Certificates of deposit............... 3,155.8 25.6 3,207.4 27.9 3,366.9 30.7
--------- ------- --------- ------- --------- -------
Total core deposits................. 10,224.8 82.9 10,203.0 88.8 9,748.7 89.0
Other time deposits................... 449.6 3.7 329.7 2.9 367.8 3.3
--------- ------- --------- ------- --------- -------
Total deposits...................... 10,674.4 86.6 10,532.7 91.7 10,116.5 92.3
Short-term borrowed funds............. 1,526.0 12.4 822.6 7.2 692.9 6.3
Long-term debt........................ 126.2 1.0 133.1 1.1 146.7 1.4
--------- ------- --------- ------- --------- -------
Total............................... $12,326.6 100.0% $11,488.4 100.0% $10,956.1 100.0%
======== ===== ======== ===== ======== =====
</TABLE>

Core deposits, which include transaction accounts and other stable time
deposits, are Firstar's prime source of funding. These deposits averaged $10.2
billion in 1994, essentially level with 1993. Increased competition for consumer
deposits and heightened consumer sensitivity to interest rates have limited
Firstar's core deposit growth. Increased emphasis will be placed on generating
more core deposits in 1995 through competitive pricing of deposit products.

More reliance was placed on purchased fund sources during 1994 to support
the growth in loan balances. Other time deposits, primarily certificates of
deposit over $100,000, increased $120 million, to $450 million on average.
Short-term borrowed funds were increased by $703 million to an average level of
$1.5 billion.

17
<PAGE> 19

CREDIT RISK MANAGEMENT

Since the mid-1980's, credit management has been refined through procedural
and personnel changes. Emphasis on credit quality standards and diversification
of risk have been key strategies. The benefits of this program are seen in the
significant reductions in nonperforming assets and overall credit quality
achieved during the past several years. During this period nonperforming assets
as a percentage of loans and other real estate have declined from 1.87% in 1990
to .58% at the end of 1994. Put in perspective of Firstar's peer group of banks,
this placed Firstar ninth within the group for asset quality.

Nonperforming assets consist of loans that are not accruing interest, loans
with renegotiated credit terms and collateral acquired in settlement of
nonperforming loans. The composition of these assets is shown in Table 10. These
nonperforming assets totaled $56.8 million at December 31, 1994 and represented
.58% of Firstar's $9.8 billion of loans and other real estate. This is a $8.1
million, or 12.4%, reduction from a year earlier.

TABLE 10

NONPERFORMING ASSETS AND PAST DUE LOANS

<TABLE>
<CAPTION>
DECEMBER 31
-----------------------------------------------------
1994 1993 1992 1991 1990
------- ------- ------- -------- --------
(thousands of dollars)
<S> <C> <C> <C> <C> <C>
Nonaccrual loans:
Commercial................................. $24,539 $21,243 $24,640 $ 30,548 $ 35,531
Commercial--real estate.................... 18,876 25,477 21,750 26,673 45,718
Consumer................................... 5,307 6,417 7,997 7,190 7,130
------- ------- ------- -------- --------
Total nonaccrual loans.................. 48,722 53,137 54,387 64,411 88,379
Renegotiated loans:
Commercial................................. 71 823 1,899 2,821 1,769
Commercial--real estate.................... 574 690 542 1,418 4,039
------- ------- ------- -------- --------
Total renegotiated loans................ 645 1,513 2,441 4,239 5,808
Other real estate*........................... 7,423 10,215 31,978 39,880 43,963
------- ------- ------- -------- --------
Total nonperforming assets.............. $56,790 $64,865 $88,806 $108,530 $138,150
======= ======= ======= ======== ========
Nonperforming assets as a percentage of:
Loans and other real estate................ .58% .72% 1.09% 1.43% 1.87%
Total assets............................... .38 .47 .67 .88 1.15
Loans past due 90 days:
Commercial................................. $ 7,122 $ 5,521 $ 5,020 $ 5,621 $ 8,376
Commercial--real estate.................... 2,859 3,934 3,248 9,016 3,518
Consumer................................... 14,152 12,348 12,359 13,591 12,524
------- ------- ------- -------- --------
Total loans past due 90 days............ $24,133 $21,803 $20,627 $ 28,228 $ 24,418
======= ======= ======= ======== ========
</TABLE>

- ------------
* Nonperforming loans which were included in other real estate under "in
substance foreclosure" accounting rules were $10.5 million, $10.5 million, and
$5.0 million at December 31, 1992, 1991, and 1990, respectively. Such "in
substance foreclosed" loans were reclassified to loans in 1993.

Commercial real estate related nonperforming assets totaled $26.9 million
at the end of 1994, a reduction of 26% from a year earlier. These nonperforming
assets represented 1.17% of their respective loan category. Firstar experienced
an increase in real estate related nonperforming assets several years ago,
although to a much lesser extent than many other financial institutions. These
assets reached a high of $93.7 million at the end of 1990. As can be seen,
significant progress has been made in reducing this category of nonperforming
assets.

18
<PAGE> 20

The remaining commercial loan portfolio had a nonperforming asset ratio of
.67% compared to .66% a year earlier. This is reflective of the overall
consistent financial strength of Firstar's commercial borrowers.

Nonperforming consumer loans have also declined from previously higher
levels. At year-end 1994, they represented a very minimal .14% of outstandings.

While further reductions of nonperforming assets are not likely, the
attainment of this low level is an indication of Firstar's overall high asset
quality.

Loans ninety days or more past due on December 31, 1994, totaled $24.1
million, compared with $21.8 million a year earlier. These loans are on a full
accrual basis and are judged by management to be collectible in full. In
addition, Firstar had $22 million of loans at December 31, 1994, on which
interest is accruing, but, because of existing economic conditions or
circumstances of the borrower, doubt exists as to the ability of the borrower to
comply with the present loan terms. While these loans are identified as
requiring additional monitoring, they do not necessarily represent future
nonperforming assets.

Additional indicators of asset quality can be found in the geographic
distribution, industry diversification and type of lending represented in the
loan portfolio. Credit policies have been changed over the past several years to
reduce vulnerability to potential adverse economic trends. Marketing efforts
have been directed to Firstar's primary market segments which are consumer,
small business and middle market customers in communities where Firstar banks
are located. This emphasis on smaller, locally based credits brings with it a
diversified group of customers without any significant industry concentration.
Firstar does not participate in any significant syndicated lending or highly
leveraged transactions.

Commercial real estate lending includes construction loans, income property
loans and other commercial loans where real estate is involved as collateral.
Midwestern real estate did not experience the rapid price appreciation that
occurred in other areas, spurring over-investment in development projects and
subsequent collapse of demand. Consequently, the earlier recessionary economy
has not put as much pressure on some of Firstar's borrowers. Policy limits
control this type of lending. Approximately sixty percent of these loans
represent owner-occupied commercial properties. The remaining portion involves
loans to developers and investors. The average loan size in the developer
portion of the portfolio was $250,000 and reflects the regional focus and
customer diversification of the portfolio.

The reserve for loan losses is reviewed and adjusted quarterly, subject to
evaluation of economic conditions and expectations, historical experience and
the risk rating of individual loans. Table 11 shows the activity affecting the
reserve for loan losses for the last five years. The reserve totaled $172.6
million at the end of 1994, compared with $174.9 million a year earlier.

Total net charge-offs of $22.9 million represented .25% of average loans
during 1994, the same level as experienced in 1993.

As a regional financial institution, Firstar lends to a diversified group
of Midwestern borrowers and, to a much lesser degree, to national companies with
Midwest operations. Net charge-offs in this commercial segment of the portfolio
were $10.8 million, or .32% of average loans. This compares with $6.1 million of
net charge-offs in 1993, representing .20% of loans. This charge-off level,
while up from the prior year, remains lower than earlier years.

19
<PAGE> 21

Commercial real estate loans experienced a net recovery of prior years'
charge-offs in 1994 of $732,000. This compares with nominal net charge-offs of
.03% in 1993. These charge-off levels are unusually low and Firstar would expect
that commercial real estate charge-offs will in the long run approximate the
overall charge-off rate of the other commercial lending areas.

TABLE 11

RESERVE FOR LOAN LOSSES

<TABLE>
<CAPTION>
1994 1993 1992 1991 1990
-------- -------- -------- -------- --------
(thousands of dollars)
<S> <C> <C> <C> <C> <C>
Balance at beginning of year.............. $174,873 $168,482 $150,628 $134,222 $116,177
Loan charge-offs:
Commercial.............................. 16,868 12,142 18,565 15,110 16,346
Commercial--real estate................. 2,009 3,050 6,135 4,227 12,614
Consumer................................ 7,758 6,399 7,049 9,754 7,941
Consumer--real estate................... 422 915 1,534 1,187 662
Credit card............................. 14,212 14,989 17,779 19,172 12,078
Foreign................................. 219
-------- -------- -------- -------- --------
Total charge-offs.................... 41,488 37,495 51,062 49,450 49,641
Loan recoveries:
Commercial.............................. 6,056 6,084 6,789 5,160 6,627
Commercial--real estate................. 2,741 2,448 3,439 845 1,482
Consumer................................ 4,048 3,359 3,383 2,557 2,276
Consumer--real estate................... 549 232 368 350 115
Credit card............................. 4,376 4,113 3,555 2,760 2,665
Foreign................................. 809 604 428 3,479 3,204
-------- -------- -------- -------- --------
Total recoveries..................... 18,579 16,840 17,962 15,151 16,369
-------- -------- -------- -------- --------
Net loan charge-offs...................... 22,909 20,655 33,100 34,299 33,272
Provision for loan losses................. 17,139 24,567 44,821 50,276 49,161
Reserves of acquired banks................ 3,503 2,479 6,133 429 2,156
-------- -------- -------- -------- --------
Total balance at end of year......... $172,606 $174,873 $168,482 $150,628 $134,222
======== ======== ======== ======== ========
Reserve to year-end loans................. 1.76% 1.95% 2.08% 2.00% 1.83%
Net charge-offs to average loans:
Commercial.............................. .32% .20% .42% .35% .35%
Commercial--real estate................. (.04) .03 .16 .22 .78
Foreign................................. (2.03) (2.76) (2.18) (14.36) (12.29)
Total commercial loans............... .17 .12 .31 .22 .42
Consumer................................ .27 .26 .34 .57 .47
Consumer--real estate................... (.01) .04 .08 .08 .06
Credit card............................. 1.93 2.17 2.73 2.90 1.73
Total consumer loans................. .36 .43 .61 .84 .57
Total loans.......................... .25 .25 .43 .47 .48
</TABLE>

Consumer lending includes loans to individuals in communities served by
Firstar's banks. These loans include both open-ended credit arrangements subject
to an overall limit per customer, such as credit card and home equity loans, and
closed-end loans subject to specific contractual payment schedules, such as
installment loans and residential mortgages. Consumer net charge-offs were $13.4
million in 1994, compared with $14.6 million in 1993 and $19.1 million in 1992.
The net charge-offs of .36% in 1994 compares with .43% and .61% in 1993 and
1992, respectively. Credit card net charge-offs have declined from 2.90% in 1991
to 1.93% during 1994 reflecting both lower charge-offs and higher recovery
rates. This progressive reduction in

20
<PAGE> 22

consumer charge-off levels reinforces the conclusion about the economic strength
of Firstar's marketplace. Consumer charge-offs are expected to remain at or near
this level.

TABLE 12

COMPOSITION OF LOANS

<TABLE>
<CAPTION>
DECEMBER 31
------------------------------------------------------------------
1994 1993 1992 1991 1990
---------- ---------- ---------- ---------- ----------
(thousands of dollars)
<S> <C> <C> <C> <C> <C>
Commercial and industrial.......... $2,753,251 $2,470,454 $2,086,146 $1,987,897 $2,054,802
Real estate--construction.......... 272,266 209,181 236,794 278,971 256,506
Real estate--mortgage.............. 2,014,262 1,739,608 1,564,001 1,336,556 1,234,978
Foreign............................ 32,395 31,269 20,546 22,077 21,885
Other.............................. 905,795 855,249 895,667 930,675 857,459
---------- ---------- ---------- ---------- ----------
Commercial loans................. 5,977,969 5,305,761 4,803,154 4,556,176 4,425,630
Credit card........................ 573,157 546,051 532,787 581,863 606,276
Real estate--mortgage.............. 1,360,088 1,363,671 1,318,179 1,067,716 1,021,554
Home equity........................ 522,201 445,135 375,427 289,386 *
Other.............................. 1,394,612 1,323,200 1,081,944 1,049,519 1,292,653
---------- ---------- ---------- ---------- ----------
Consumer loans................... 3,850,058 3,678,057 3,308,337 2,988,484 2,920,483
---------- ---------- ---------- ---------- ----------
Total loans...................... $9,828,027 $8,983,818 $8,111,491 $7,544,660 $7,346,113
========== ========== ========== ========== ==========
</TABLE>

- ------------
* Comparable data not available

LIQUIDITY AND INTEREST RATE RISK MANAGEMENT

Two objectives of Firstar's asset and liability management strategy include
the maintenance of appropriate liquidity and management of interest rate risk.
Liquidity management aligns sources and uses of funds to meet the cash flow
requirements of customers and Firstar. Interest rate risk management seeks to
generate growth in net interest revenue and manage exposure to risks associated
with interest rate movements and provide for acceptable and predictable results.
Although conceptually distinct, liquidity and interest rate sensitivity must be
managed together since action taken with respect to one often influences the
other.

The scheduled maturity of loans can provide a source of asset liquidity.
Table 13 shows the range of loan maturities as of December 31, 1994. Short-term
investments, such as federal funds, repurchase agreements and interest-bearing
deposits, are another source of liquidity. These investments stood at $376
million at the end of 1994. The securities portfolio provides liquidity through
scheduled maturities, as shown in Table 7, and the ability to use these
securities in borrowing transactions. Additionally, those securities designated
as available for sale were $51 million at the end of 1994 and can be sold to
meet liquidity needs.

TABLE 13

MATURITY DISTRIBUTION OF LOANS

<TABLE>
<CAPTION>
TOTAL
DUE WITHIN ONE TO FIVE AFTER FIVE DECEMBER 31,
ONE YEAR YEARS YEARS 1994
---------- ----------- ---------- ------------
(thousands of dollars)
<S> <C> <C> <C> <C>
Commercial.................................... $2,668,476 $ 2,460,123 $ 849,370 $5,977,969
Consumer...................................... 992,502 2,286,867 570,689 3,850,058
---------- ----------- ---------- ------------
Total....................................... $3,660,978 $ 4,746,990 $1,420,059 $9,828,027
========= ========= ========= ==========
</TABLE>

- ------------
The maturity is based upon contractual terms and Firstar may however extend the
maturity at prevailing rates and terms in the normal course of business.

Of the above loans due after one year, $4,147,088,000 have predetermined
interest rates and $2,019,961,000 have floating or adjustable interest rates.

21
<PAGE> 23

TABLE 14

MATURITY RANGE OF TIME DEPOSITS

<TABLE>
<CAPTION>
TOTAL
DUE WITHIN THREE TO SIX TO AFTER DECEMBER 31,
THREE MONTHS SIX MONTHS TWELVE MONTHS TWELVE MONTHS 1994
------------ ---------- ------------- ------------- ------------
(thousands of dollars)
<S> <C> <C> <C> <C> <C>
Certificates of deposit of $100,000
or more............................ $342,763 $ 94,151 $95,945 $ 116,114 $648,973
Other time deposits of $100,000 or
more............................... 6,924 3,563 3,399 9,235 23,121
---------- --------- --------- ----------- ----------
Total.............................. $349,687 $ 97,714 $99,344 $ 125,349 $672,094
========== ========= ========= =========== ==========
</TABLE>

The requirement of liquidity is diminished by the predominance of core
deposits, which account for 83% of Firstar's fund sources. Stable core deposits
do not require significant amounts of liquidity to meet the net withdrawal
demands of customers on a short or intermediate term basis. Other sources of
liquidity are short-term borrowed funds and time deposits which totaled $2.7
billion at the end of 1994. Firstar's ability to refinance maturing amounts and,
when necessary, increase this funding base is a significant factor in its
liquidity management.

The absolute level and volatility of interest rates can have a significant
impact on earnings. The objective of interest rate risk management is to
identify and manage the sensitivity of net interest revenue to changing interest
rates. Firstar uses computer simulation modeling as its primary method of
quantifying and evaluating interest rate risk. Simulation modeling is performed
at least quarterly and is used to quantify the impact on net interest revenue of
various assumptions about interest rate and balance sheet changes and the use of
off-balance sheet derivatives and financial instruments. The use of simulation
modeling also enables Firstar to develop and test alternative asset and
liability management strategies. Interest rate risk and the results of the
simulation modeling is reviewed quarterly by bank, regional and corporate
committees who assess the interest rate risk position and approve corresponding
strategies. The objective of Firstar's asset liability management policy is to
maintain adequate capital and liquidity and manage interest rate risk to produce
an acceptable level of net interest revenue. Firstar's guideline is to employ an
asset liability management strategy which limits the potential impact of
projected interest rate changes to 5% of net income over the subsequent four
quarters. In the most recent simulation, which excludes pending acquisitions,
net interest revenue was forecast for 1995 under four interest rate scenarios.
First, if current rates continued unchanged at the fourth quarter 1994 level
with a prime rate of 8.50%, and then under most likely, high and low interest
rate scenarios in which the prime rate changes to 9.25%, 10.50% and 7.00%
respectively, by the fourth quarter of 1995.

Compared to 1994 net interest revenue in 1995 would increase by $21 million
if rates in the fourth quarter of 1994 remained unchanged throughout 1995. Under
the most likely and low scenarios, net interest revenue in 1995 would increase
by $9 million and $22 million, respectively, compared to 1994. Under the high
scenario, net interest revenue would decline by $9 million compared to 1994.

22
<PAGE> 24

The simulation model is supplemented with a tool used in the banking
industry for measurement of interest rate risk known as the gap analysis. This
measures the difference between assets and liabilities repricing or maturing
within specified time periods. The gap analysis does however, have some
limitations such as not reflecting the magnitude which assets or liabilities may
reprice within a given interest rate scenario. A positive gap indicates that
there are more rate sensitive assets than rate sensitive liabilities repricing
within a given time frame. A positive gap would generally imply a favorable
impact on net income in periods of rising rates. Conversely, a negative gap
indicates a liability sensitive position. Table 15 shows Firstar's interest
sensitivity under a traditional gap approach.

While Firstar believes the above assumptions for the gap analysis and
simulations are reasonable, actual interest rates and other factors could be
significantly different from those assumed. Such differences could produce
actual results which are different from projected results and the differences
could be significant.

TABLE 15

ASSET AND LIABILITY INTEREST SENSITIVITY

<TABLE>
<CAPTION>
NON-RATE
1-30 31-90 91-180 181-365 TOTAL SENSITIVE &
DAYS DAYS DAYS DAYS ONE YEAR OVER 1 YEAR TOTAL
------ ------- ------- ------- -------- ----------- -------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C> <C>
Loans........................ $3,964 $ 525 $ 346 $ 846 $ 5,681 $ 4,147 $ 9,828
Securities................... 72 125 79 337 613 2,778 3,391
Interest-bearing deposits
with banks................. 4 4 4
Short-term investments....... 371 371 371
Other assets................. 1,683 1,683
Less: Reserve for loan
losses..................... (173) (173)
------ ------- ------- ------- -------- ----------- -------
Total assets............ 4,411 650 425 1,183 6,669 8,435 15,104
Non-interest-bearing demand
deposits................... 2,778 2,778
Interest-bearing demand
accounts................... 200 200 400 1,075 1,475
Savings passbook............. 150 150 300 1,209 1,509
Money market accounts........ 205 756 700 1,661 1,661
Less than one year
certificates............... 173 187 192 214 766 766
Other deposits............... 501 245 284 815 1,845 1,200 3,045
Borrowed funds............... 1,731 224 149 38 2,142 135 2,277
Other liabilities............ 286 286
Stockholders' equity......... 1,307 1,307
------ ------- ------- ------- -------- ----------- -------
Total liabilities and
stockholders'
equity................ 2,960 1,006 1,381 1,767 7,114 7,990 15,104
Interest sensitive gap....... 1,451 (356) (956) (584) (445 ) (445)
Interest rate swaps........ (110) (230) 12 (328 )
Periodic caps.............. (375) (555) (930 )
------ ------- ------- ------- --------
Adjusted interest sensitive
gap........................ $ 966 $(1,141) $ (944) $ (584) $(1,703 )
====== ======= ======= ======= =======
Cumulative adjusted interest
sensitive gap.............. $ 966 $ (175) $(1,119) $(1,703)
</TABLE>

23
<PAGE> 25

Firstar seeks to manage interest rate risk by adjusting the pricing and
levels of assets and liabilities along with the use of off-balance sheet
derivative financial instruments. Firstar enters into interest rate swaps and
interest rate caps and floors as part of this process. These derivative
instruments synthetically alter the repricing characteristics of designated
assets and liabilities. Additional information on derivative financial
instruments are included in Notes 17 and 18 to the Consolidated Financial
Statements.

Firstar's off-balance sheet financial derivative portfolio has a notional
value of $1.7 billion as of December 31, 1994. During 1993 and early 1994,
Firstar's simulation modeling indicated a risk to net interest revenue in a
falling rate environment. Under this scenario income on variable rate loans
would be reduced and not matched by corresponding reductions in the cost of
deposits being used to fund these loans. Such deposits, savings passbook,
interest bearing transactions and money market accounts were deemed to have
already reached their lowest cost point based on competitive considerations.
Consequently, Firstar, in 1993 and early 1994, entered into approximately $1.3
billion of new off-balance sheet financial derivative instruments to mitigate
this risk. Interest rates have subsequently increased and while Firstar is
currently a net payor on the instruments, it is also realizing an increased net
yield on the designated hedged assets and liabilities.

Net cash flows of off-balance sheet derivative instruments used to manage
interest rate risk contributed $930 thousand to net interest revenue during 1994
compared with $5.7 million in 1993 and $8.8 million in 1992. Expressed in terms
of net interest margin, the financial derivative portfolio had no impact in 1994
compared with .05% in 1993 and .09% in 1992. Using the most likely interest rate
scenario, it is expected that derivative financial instruments will result in a
reduction of net interest margin of .10% in 1995.

Capital

Total stockholders' equity increased 13.0% to $1.31 billion as of December
31, 1994. Stockholders' equity represented 8.65% of total assets at the end of
1994 compared to 8.38% a year earlier.

Firstar redeemed its adjustable rate preferred stock at the end of 1993 at
a price of $103 per share, or $51.5 million. This action removed a higher cost
equity component.

Dividends paid to common stockholders totaled $75.1 million, or $1.16 per
share, a 16% increase over 1993. This represented a 36% payout of net income for
1994. It is Firstar's target to maintain a dividend payout level approximately
equal to the median of its peer group.

Bank regulatory agencies have established capital adequacy standards which
are used extensively in their monitoring and control of the industry. These
standards relate capital to level of risk by assigning different weightings to
assets and certain off-balance sheet activity. Capital is measured by two
risk-based ratios: Tier I capital and total capital, which includes Tier II
capital. The rules require that companies have minimum ratios of 4% and 8% for
Tier I and total capital, respectively. As of December 31, 1994, Firstar had
Tier I capital of 11.68% and total capital of 13.46%, significantly exceeding
regulatory minimum standards. The components of these capital levels are shown
in Table 16.

Additionally, a Tier I leverage ratio is also used by bank regulators as
another measure of capital strength. This ratio compares Tier I capital to total
reported assets reduced by goodwill. The regulatory minimum level of this ratio
is 3%, and it acts as a constraint on the degree to which a company can leverage
its equity base. Firstar's Tier I leverage ratio was 8.58% at December 31, 1994.

The Federal Deposit Insurance Corporation Improvement Act of 1991 provided
additional guidelines that considers capital levels and other factors. The
guidelines established five supervisory groupings of capital adequacy. Firstar
is considered "well capitalized" which is the highest group.

24
<PAGE> 26

Maintaining a strong capital position is important to Firstar's long-term
strategies which emphasize soundness, profitability and growth. Higher capital
levels contribute to overall financial soundness as a cushion against cyclical
economic trends which can effect the banking industry. Strong capital levels
also will permit future growth through both internal asset generation and bank
acquisitions.

TABLE 16

CAPITAL COMPONENTS AND RATIOS

<TABLE>
<CAPTION>
DECEMBER 31
-------------------------------------------
1994 1993 1992
----------- ---------- ----------
(thousands of dollars)
<S> <C> <C> <C>
Risk-based capital:
Stockholders' equity.............................. $ 1,306,528 $1,155,897 $1,048,388
Unrealized losses on securities available for
sale........................................... 988
Minority interest in subsidiaries................. 2,920 2,214 1,979
Less goodwill..................................... (71,392) (72,602) (76,992)
----------- ---------- ----------
Total Tier I capital........................... 1,239,044 1,085,509 973,375
Allowable reserve for loan losses................. 133,121 123,953 114,837
Allowable long-term debt.......................... 56,327 81,486 107,010
----------- ---------- ----------
Total Tier II capital.......................... 189,448 205,439 221,847
----------- ---------- ----------
Total capital.................................. $ 1,428,492 $1,290,948 $1,195,222
========== ========= =========
Risk-adjusted assets................................ $10,610,207 $9,792,746 $9,056,307
Tier I capital to risk-adjusted asset............... 11.68% 11.08% 10.75%
Total capital to risk-adjusted assets............... 13.46 13.18 13.20
Tier I leverage ratio............................... 8.58 8.30 7.71
</TABLE>

25
<PAGE> 27

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

FIRSTAR CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31 AVERAGE BALANCES
------------------------- -------------------------
1994 1993 1994 1993
----------- ----------- ----------- -----------
(thousands of dollars)
<S> <C> <C> <C> <C>
ASSETS

Cash and due from banks..................... $ 999,926 $ 1,228,957 $ 873,275 $ 938,407
Interest-bearing deposits with banks........ 4,372 4,328 4,902 33,043
Federal funds sold and resale agreements.... 342,234 282,517 200,039 147,744
Trading securities.......................... 29,050 12,491 22,123 17,332
Securities held to maturity (market value
$3,244,658 and $2,894,594 on December 31,
1994 and 1993)............................ 3,339,911 2,834,305 2,949,088 2,929,035
Securities available for sale............... 51,308 11,041
Loans....................................... 9,828,027 8,983,818 9,261,409 8,332,963
Reserve for loan losses..................... (172,606) (174,873) (175,393) (173,224)
----------- ----------- ----------- -----------
Loans-net.............................. 9,655,421 8,808,945 9,086,016 8,159,739
Bank premises and equipment................. 294,026 264,569 270,218 259,064
Customer acceptance liability............... 13,260 17,412 19,874 19,962
Other assets................................ 374,799 340,471 360,271 352,913
----------- ----------- ----------- -----------
Total assets........................... $15,104,307 $13,793,995 $13,796,847 $12,857,239
========== ========== ========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand.................................... $ 2,778,240 $ 3,064,314 $ 2,533,883 $ 2,531,844
Interest-bearing demand................... 1,474,949 1,557,145 1,412,178 1,418,061
Money market accounts..................... 1,661,283 1,564,414 1,580,884 1,555,455
Savings passbook.......................... 1,508,918 1,528,222 1,542,044 1,490,209
Certificates of deposit................... 3,811,623 3,449,519 3,605,420 3,537,120
----------- ----------- ----------- -----------
Total deposits......................... 11,235,013 11,163,614 10,674,409 10,532,689
Short-term borrowed funds................... 2,141,456 1,112,490 1,525,982 822,580
Long-term debt.............................. 135,088 126,275 126,184 133,135
Bank acceptances outstanding................ 13,260 17,412 19,874 19,962
Other liabilities........................... 272,962 218,307 226,449 218,683
----------- ----------- ----------- -----------
Total liabilities...................... 13,797,779 12,638,098 12,572,898 11,727,049
Stockholders' equity:
Preferred stock........................... 495
Common stock.............................. 83,332 81,149 81,642 80,401
Issued: 1994, 66,665,739 shares........
1993, 64,919,422 shares.........
Capital surplus........................... 174,067 149,882 155,265 189,718
Retained earnings......................... 1,061,221 928,559 995,554 863,311
Treasury stock, at cost................... (10,669) (3,034) (7,719) (3,343)
Held: 1994, 792,303 shares.............
1993, 558,603 shares..............
Restricted stock.......................... (435) (659) (624) (392)
Unrealized losses on securities available
for sale............................... (988) (169)
----------- ----------- ----------- -----------
Total stockholders' equity............. 1,306,528 1,155,897 1,223,949 1,130,190
----------- ----------- ----------- -----------
Total liabilities and stockholders'
equity............................... $15,104,307 $13,793,995 $13,796,847 $12,857,239
========== ========== ========== ==========
</TABLE>

- ------------
The average balances are not covered by the Independent Auditors' Report.

See accompanying notes to consolidated financial statements.

26
<PAGE> 28

FIRSTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
------------------------------------
1994 1993 1992
-------- -------- --------
(thousands of dollars, except per
share data)
<S> <C> <C> <C>
INTEREST REVENUE
Loans.................................................... $761,672 $685,530 $693,594
Securities:
Taxable................................................ 122,759 129,574 140,632
Nontaxable............................................. 43,216 45,078 51,104
-------- -------- --------
Total securities.................................. 165,975 174,652 191,736
Interest-bearing deposits with banks..................... 288 1,385 2,608
Federal funds sold and resale agreements................. 8,841 4,602 9,791
Trading securities....................................... 1,211 785 792
-------- -------- --------
Total interest revenue............................ 937,987 866,954 898,521
INTEREST EXPENSE
Deposits:
Interest-bearing demand................................ 18,173 23,666 31,977
Money market accounts.................................. 44,416 38,968 49,555
Savings passbook....................................... 36,112 38,214 40,247
Certificates of deposit................................ 163,427 160,786 199,626
-------- -------- --------
Total deposits.................................... 262,128 261,634 321,405
Short-term borrowed funds................................ 65,408 23,811 23,423
Long-term debt........................................... 12,865 13,453 14,541
-------- -------- --------
Total interest expense............................ 340,401 298,898 359,369
-------- -------- --------
NET INTEREST REVENUE..................................... 597,586 568,056 539,152
Provision for loan losses................................ 17,139 24,567 44,821
-------- -------- --------
NET INTEREST REVENUE AFTER LOAN LOSS PROVISION........... 580,447 543,489 494,331
OTHER OPERATING REVENUE
Trust and investment management fees..................... 117,872 110,185 95,926
Service charges on deposit accounts...................... 72,366 74,071 66,301
Credit card service revenue.............................. 55,779 53,316 51,867
Data processing fees..................................... 20,263 21,431 24,215
Mortgage banking revenue................................. 15,053 26,158 12,372
Securities gains......................................... 76 182 981
Other revenue............................................ 53,826 56,922 49,105
-------- -------- --------
Total other operating revenue..................... 335,235 342,265 300,767
OTHER OPERATING EXPENSE
Salaries................................................. 265,731 257,405 237,997
Employee benefits........................................ 60,175 59,443 49,610
Equipment expense........................................ 49,251 48,139 48,720
Net occupancy expense.................................... 45,914 48,731 44,408
Net other real estate (income) expense................... (1,489) 2,056 4,303
Other expense............................................ 185,343 171,970 172,528
-------- -------- --------
Total other operating expense..................... 604,925 587,744 557,566
-------- -------- --------
INCOME BEFORE INCOME TAXES............................... 310,757 298,010 237,532
Provision for income taxes............................... 103,014 93,716 71,547
-------- -------- --------
NET INCOME............................................... $207,743 $204,294 $165,985
======== ======== ========
Net income applicable to common stock.................... $207,743 $201,028 $162,238
PER COMMON SHARE
Net income............................................... $ 3.22 $ 3.15 $ 2.62
Dividends................................................ 1.16 1.00 .80
</TABLE>

See accompanying notes to consolidated financial statements.

27
<PAGE> 29

FIRSTAR CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
UNREALIZED
LOSSES ON
PREFERRED STOCK COMMON STOCK SECURITIES
----------------- -------------------- CAPITAL RETAINED AVAILABLE
SHARES AMOUNT SHARES AMOUNT SURPLUS EARNINGS FOR SALE
-------- ------ ---------- ------- -------- ---------- ----------
(thousands of dollars, except per share data)
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE AT DECEMBER 31, 1991............. 500,000 $ 500 61,715,280 $77,144 $160,023 $ 681,432 $ 0
Net income............................... 165,985
Cash dividends:
Preferred stock, series B ($7.5502 per
share)............................... (3,775)
Common stock ($.80 per share).......... (49,429)
Common stock issued:
Bank acquisitions...................... 1,307,016 1,634 15,812
Employee benefit plans................. 147,124 184 2,947
Other.................................. 94,031 118 701
Treasury stock purchased.................
-------- ------ ---------- ------- -------- ---------- ----------
BALANCE AT DECEMBER 31, 1992............. 500,000 500 63,263,451 79,080 179,483 794,213 0
Net income............................... 204,294
Cash dividends:
Preferred stock, series B ($7.4419 per
share)............................... (3,720)
Common stock ($1.00 per share)......... (63,733)
Redemption of preferred stock............ (500,000) (500 ) (48,505) (2,495)
Common stock issued:
Bank acquisitions...................... 1,018,734 1,273 12,234
Employee benefit plans................. 104,043 130 1,920
Other.................................. 502,959 628 3,858
Treasury stock purchased.................
Restricted stock granted................. 30,235 38 892
Amortization of restricted stock.........
-------- ------ ---------- ------- -------- ---------- ----------
BALANCE AT DECEMBER 31, 1993............. 0 0 64,919,422 81,149 149,882 928,559 0
Net income............................... 207,743
Cash dividends:
Common stock ($1.16 per share)......... (75,081)
Common stock issued:
Bank acquisitions...................... 1,662,033 2,078 22,735
Employee benefit plans................. 84,284 105 1,563
Treasury stock purchased.................
Unrealized losses on securities available
for sale............................... (988)
Amortization/adjustment of restricted
stock.................................. (113)
-------- ------ ---------- ------- -------- ---------- ----------
BALANCE AT DECEMBER 31, 1994............. 0 $ 0 66,665,739 $83,332 $174,067 $1,061,221 $ (988)
========= ======= ========== ======== ========= ========== ==========

TREASURY STOCK
RESTRICTED -------------------
STOCK SHARES AMOUNT TOTAL
---------- -------- -------- ----------

<S> <C> <C> <C> <C>
BALANCE AT DECEMBER 31, 1991............. $ 0 (583,648) $ (2,760) $ 916,339
Net income............................... 165,985
Cash dividends:
Preferred stock, series B ($7.5502 per
share)............................... (3,775)
Common stock ($.80 per share).......... (49,429)
Common stock issued:
Bank acquisitions...................... 690,262 19,948 37,394
Employee benefit plans................. 50,520 416 3,547
Other.................................. 819
Treasury stock purchased................. (780,606) (22,492) (22,492)
---------- -------- -------- ----------
BALANCE AT DECEMBER 31, 1992............. 0 (623,472) (4,888) 1,048,388
Net income............................... 204,294
Cash dividends:
Preferred stock, series B ($7.4419 per
share)............................... (3,720)
Common stock ($1.00 per share)......... (63,733)
Redemption of preferred stock............ (51,500)
Common stock issued:
Bank acquisitions...................... 105,069 3,098 16,605
Employee benefit plans................. 935 31 2,081
Other.................................. 4,486
Treasury stock purchased................. (41,135) (1,275) (1,275)
Restricted stock granted................. (930) 0
Amortization of restricted stock......... 271 271
---------- -------- -------- ----------
BALANCE AT DECEMBER 31, 1993............. (659) (558,603) (3,034) 1,155,897
Net income............................... 207,743
Cash dividends:
Common stock ($1.16 per share)......... (75,081)
Common stock issued:
Bank acquisitions...................... 139,508 4,551 29,364
Employee benefit plans................. 1,100 36 1,704
Treasury stock purchased................. (374,308) (12,222) (12,222)
Unrealized losses on securities available
for sale............................... (988)
Amortization/adjustment of restricted
stock.................................. 224 111
---------- -------- -------- ----------
BALANCE AT DECEMBER 31, 1994............. $ (435) (792,303) $(10,669) $1,306,528
========= ========= ========= ==========
</TABLE>

See accompanying notes to consolidated financial statements.

28
<PAGE> 30

FIRSTAR CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
-----------------------------------------
1994 1993 1992
----------- ----------- -----------
(thousands of dollars)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income............................................ $ 207,743 $ 204,294 $ 165,985
Adjustments:
Provision for loan losses........................... 17,139 24,567 44,821
Depreciation, amortization and accretion............ 33,160 29,530 47,571
Net (increase) decrease in trading securities....... (16,559) 8,382 (4,824)
Net decrease (increase) in loans held for resale.... 193,439 (52,143) (92,471)
(Gain) loss on securities and other assets.......... (3,034) 1,249 (2,710)
Deferred income taxes............................... (1,488) (9,866) (10,061)
Decrease in other assets............................ 26,629 5,667 14,045
Increase (decrease) in other liabilities............ 29,772 26,739 (19,246)
Other net........................................... (3,336) 211 (6,123)
----------- ----------- -----------
Net cash provided by operating activities........ 483,465 238,630 136,987
CASH FLOWS FROM INVESTING ACTIVITIES
Net (increase) decrease in federal funds sold and
resale agreements................................... (58,417) (52,756) 74,567
Net decrease (increase) in interest-bearing deposits
with banks.......................................... (44) 178,855 (37,826)
Sales of securities................................... 4,155 92,461
Maturities of securities.............................. 878,044 1,467,156 1,714,272
Purchases of securities held to maturity.............. (1,334,281) (1,380,307) (1,719,290)
Purchases of securities available for sale............ (6,539)
Net increase in loans................................. (831,358) (693,323) (102,818)
Net cash from acquisitions............................ 34,199 11,695 6,713
Proceeds from sales of other real estate.............. 13,149 15,818 6,832
Purchases of bank premises and equipment.............. (54,607) (36,141) (43,093)
Proceeds from sales of bank premises and equipment.... 1,125 458 2,486
----------- ----------- -----------
Net cash used in investing activities............ (1,358,729) (484,390) (5,696)
CASH FLOWS FROM FINANCING ACTIVITIES
Net (decrease) increase in deposits................... (297,268) 85,116 259,999
Net increase (decrease) in short-term borrowed
funds............................................... 1,024,795 245,803 (79,984)
Repayment of long-term debt........................... (5,137) (27,337) (18,899)
Proceeds from long-term debt.......................... 10,000
Cash dividends........................................ (75,081) (67,453) (53,204)
Preferred stock redemption............................ (51,500)
Common stock transactions............................. (11,076) 138 (19,788)
----------- ----------- -----------
Net cash provided by financing activities........ 646,233 184,767 88,124
----------- ----------- -----------
NET (DECREASE) INCREASE IN CASH AND DUE FROM BANKS.... (229,031) (60,993) 219,415
Cash and due from banks at beginning of year.......... 1,228,957 1,289,950 1,070,535
----------- ----------- -----------
Cash and due from banks at end of year................ $ 999,926 $ 1,228,957 $ 1,289,950
========== ========== ==========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the year for:
Interest............................................ $ 327,446 $ 303,069 $ 372,713
Income taxes........................................ 102,991 107,525 74,483
Transfers to other real estate from loans............. 9,935 4,964 17,263
Acquisitions:
Assets acquired..................................... 437,563 218,592 655,095
Cash paid for purchase of stock..................... $ $ $ (12,730)
Cash acquired....................................... 34,199 11,695 19,443
----------- ----------- -----------
Net cash from acquisitions....................... $ 34,199 $ 11,695 $ 6,713
========== ========== ==========
</TABLE>

See accompanying notes to consolidated financial statements.

29
<PAGE> 31

FIRSTAR CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 1994, 1993 AND 1992

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies of Firstar Corporation and its
subsidiaries are summarized as follows:

Principles of consolidation--The consolidated financial statements include
the accounts of Firstar and its subsidiaries. All significant intercompany
accounts and transactions have been eliminated in consolidation. Results of
operations of companies purchased are included from the date of acquisition.
Financial statements have been restated to include companies acquired under
pooling of interests when material. Certain prior year amounts have been
reclassified to conform to current year classifications.

Securities--Purchases of securities that are made with the positive intent
and ability to hold them to maturity are carried at cost, adjusted for
amortization of premium and accretion of discount using a level yield method.
Securities to be held for indefinite periods of time and not intended to be held
to maturity or on a long-term basis are classified as available for sale and
carried at market value. Valuation adjustments are recorded as an adjustment to
stockholders' equity. Securities held for indefinite periods of time may include
securities that management intends to use as part of its asset/liability
management strategy or have been acquired in business acquisitions and are
designated to be sold. Gains or losses on sales of securities are computed on
the basis of specific identification of the adjusted cost of each security.
Trading securities are carried at market. Valuation adjustments are included in
other revenue in the consolidated statements of income.

Loans--Loans, which include lease financing receivables, are stated at the
principal amount. Interest is accrued on all loans not discounted by applying
the interest rate to the amount outstanding. On discounted loans, income is
recognized on a basis which results in approximately level rates of return over
the term of the loans. Loan origination and commitment fees and certain direct
loan origination costs are being deferred where material and the net amount
amortized as an adjustment of the related loans' yield. These amounts are being
amortized over the contractual life of the related loans. Where it is not
reasonable to expect that income will be realized, accrual of income ceases and
these loans are placed on a "cash basis" for purposes of income recognition.
Loans upon which foreclosure action is commenced or for which borrowers have
begun bankruptcy proceedings are reviewed individually as to continuation of
interest accrual. Mortgage loans held for sale are carried at the lower of
aggregate cost or market, after consideration of related loan sale commitments.

Reserve for loan losses--The reserve for loan losses is maintained at a
level adequate to provide for potential loan losses through charges to operating
expense. The reserve is based upon a continuing review of loans which includes
consideration of actual net loan loss experience, changes in the size and
character of the loan portfolio, identification of problem situations which may
affect the borrowers' ability to repay and evaluation of current economic
conditions. Loan losses are recognized through charges to the reserve.
Installment and credit card loan losses are charged to the reserve based upon
fixed delinquency periods. All other loans are evaluated individually and
charged to the reserve to the extent that outstanding principal balances are
deemed uncollectible. Any subsequent recoveries are added to the reserve.

Other Real Estate--Other real estate, the balance of which is included in
other assets, includes primarily properties acquired through loan foreclosure
proceedings or acceptance of deeds in lieu of foreclosure. These properties are
recorded at the lower of the carrying value of the related loans or the fair
market value of the real estate acquired less the estimated costs to sell the
real estate. Initial valuation adjustments, if any, are charged against the
reserve for loan losses. Subsequent reevaluations of the properties, which
indicate reduced value, are recognized through charges to operating expense.
Revenues and expenditures related to holding and operating these properties are
included in other operating expense.

Bank premises and equipment--Bank premises and equipment are stated at cost
less depreciation, which has been accumulated on the straight-line basis.

30
<PAGE> 32

Intangible assets--Intangible assets attributable to the value of core
deposits and goodwill acquired are included in other assets and are amortized
over fifteen to twenty-five years, on a straight-line basis. The value of
mortgage servicing rights acquired is amortized in relation to the servicing
revenue expected to be earned. Firstar periodically evaluates the carrying value
and remaining amortization periods of intangible assets for impairment.
Adjustments are recorded when the benefit of the intangible asset decreases due
to disposition of branches or deposits with regard to goodwill and core deposit
premium, and prepayments of serviced loans for purchased mortgage servicing
rights.

Income taxes--Firstar and its subsidiaries file a consolidated federal
income tax return. The effect of items of income and expense that are recognized
for financial reporting purposes in periods other than those in which they are
recognized for tax purposes are reflected as a current or deferred tax asset or
liability based on current tax laws. Accordingly, income taxes provided in the
consolidated statements of income include charges or credits for deferred income
taxes related to temporary differences.

Foreign currency transactions--Monetary assets and liabilities recorded in
foreign currencies are translated at the rate of exchange in effect at each
year-end. Income statement items are translated monthly using the average rate
for the month. Firstar enters into forward exchange contracts on behalf of its
customers and hedges its risk by entering into offsetting transactions with
other counterparties. The fair value of these transactions are included in other
assets and liabilities and the related gain or loss is recorded in other
revenue.

Cash and cash equivalents--For purposes of the consolidated statements of
cash flows, cash and cash equivalents are considered to include the balance
sheet caption cash and due from banks.

Derivative and other financial instruments--Firstar enters into interest
rate swaps and other financial instruments to manage interest rate risks arising
from financial assets and financial liabilities and also as an intermediary for
transactions with its customers. Interest rate instruments entered into as an
intermediary are accounted for as trading instruments and are recorded in the
balance sheet at fair value. Realized and unrealized changes in fair values are
recognized in other operating revenue.

Amounts receivable or payable under financial instruments used to manage
interest rate risks are recognized as interest income or expense using the
accrual method. Gains and losses on financial instruments qualifying as hedges
of existing assets or liabilities are included in the carrying amount of those
assets and liabilities. Gains and losses on early termination of interest rate
swaps are included in the carrying amount of the related loan or debt and
amortized as yield adjustments over the remaining term of the loan or debt. Fees
paid or received in connection with interest rate floors and caps are deferred
and amortized over the life of the instrument.

Income per common share--Net income per common share is based on the
weighted average number of shares of common stock outstanding during each year,
after giving effect to common stock splits and the amortization of restricted
stock. The weighted average shares were 64,611,000 in 1994, 63,747,000 in 1993
and 61,879,000 in 1992. For calculation purposes, earnings are reduced by
preferred stock dividends. Common stock equivalents are not significant in any
year presented.

31
<PAGE> 33

NOTE 2. MERGERS AND ACQUISITIONS

The following table summarizes completed acquisitions:

<TABLE>
<CAPTION>
TOTAL METHOD OF
NAME OF INSTITUTION ASSETS ACQUISITION DATE CONSIDERATION ACCOUNTING
- ----------------------------------------- ------ ---------------- --------------- ----------
(millions of dollars)
<S> <C> <C> <C> <C>
1994:
First Southeast Banking Corp
Lake Geneva, WI..................... $423 October 1994 1,801,577 Pooling of
shares of interests
common stock
-----
Total............................. $423
=====
1993:
Bank of Athens
Athens, WI.......................... $102 August 1993 447,655 shares Pooling of
of common stock interests
Deerfield State Bank
Deerfield, IL....................... 120 February 1993 676,317 shares Pooling of
of common stock interests
-----
Total............................. $222
=====
1992:
Federated Bank, S.S.B.
Wauwatosa, WI....................... $413 September 1992 Cash $12.7 Purchase
734,616 shares
of common stock
Citizens National Bank of Lake Geneva
Lake Geneva, WI..................... 49 August 1992 262,958 shares Pooling of
of common stock interests
First National Bank of Geneva
Geneva, IL.......................... 193 June 1992 999,704 shares Pooling of
of common stock interests
-----
Total............................. $655
=====
</TABLE>

The bank acquisitions shown above, accounted for as pooling of interests,
were not material to prior years' reported operating results and, accordingly,
previously reported results have not been restated.

On January 31, 1995, Firstar Corporation completed its merger with First
Colonial Bankshares Corporation in a transaction accounted for as a pooling of
interests. Firstar Corporation issued .7725 shares of Firstar common stock for
each share of First Colonial Bankshares Corporation common stock. The total
number of shares of Firstar common stock issued was approximately 7,700,000
shares.

32
<PAGE> 34

A summary of unaudited pro forma financial information giving effect to the
merger with First Colonial Bankshares Corporation is shown below. The unaudited
financial information is not indicative of the results that would have been
realized had the entities been a single company during these periods, nor is it
indicative of the actual results the combined company will report in the future.
Firstar will present restated financial statements to reflect this transaction
beginning with the fiscal quarter ended March 31, 1995.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
-----------------------------------------
1994 1993 1992
----------- ----------- -----------
(thousands of dollars, except per share)
<S> <C> <C> <C>
Total assets.......................................... $16,871,053 $15,398,037 $14,749,501
Net interest revenue.................................. 676,491 632,829 603,172
Other operating revenue............................... 353,122 364,617 324,142
Net income............................................ 219,745 217,913 178,187
Net income per common share........................... 3.02 2.99 2.50
</TABLE>

In 1994, Firstar Corporation announced a merger agreement with Investors
Bank Corp., a $1.1 billion thrift holding company in Wayzata, MN. The
transaction will be accounted for as a pooling of interests with the issuance of
approximately 3,000,000 shares of Firstar stock.

In 1994, Firstar Corporation announced a merger agreement with First Moline
Financial Corporation, an $80 million thrift holding company in Moline, IL. The
transaction will be accounted for as a purchase with the issuance of
approximately 300,000 shares of Firstar stock.

NOTE 3. INTANGIBLE ASSETS

Intangible assets, net of accumulated amortization, are summarized as
follows:

<TABLE>
<CAPTION>
DECEMBER 31
-----------------------------------------
1994 1993 1992
----------- ----------- -----------
(thousands of dollars)
<S> <C> <C> <C>
Goodwill.............................................. $ 71,392 $ 72,602 $ 76,992
Core deposit intangibles.............................. 17,417 20,119 22,821
Purchased mortgage servicing rights................... 4,653 2,357 6,464
----------- ----------- -----------
Total............................................... $ 93,462 $ 95,078 $ 106,277
=========== =========== ===========
Amortization of intangibles during year............... $ 8,318 $ 12,717 $ 15,520
</TABLE>

33
<PAGE> 35

NOTE 4. SECURITIES

The amortized cost and approximate market values of securities are as
follows:

<TABLE>
<CAPTION>
DECEMBER 31, 1994
----------------------------------------------------
AMORTIZED UNREALIZED UNREALIZED MARKET
COST GAINS LOSSES VALUE
---------- ---------- ---------- ----------
(thousands of dollars)
<S> <C> <C> <C> <C>
Securities held to maturity:
U.S. Treasury and federal agencies............ $1,457,708 $ 996 $ (57,211) $1,401,493
Mortgage backed obligations of federal
agencies................................... 838,165 1,889 (30,351) 809,703
State and political subdivisions.............. 891,880 6,025 (16,025) 881,880
Corporate debt................................ 55,300 71 (647) 54,724
Equity securities............................. 33,406 33,406
Other......................................... 63,452 63,452
---------- ---------- ---------- ----------
Total...................................... $3,339,911 $ 8,981 $ (104,234) $3,244,658
========= ======== ========= =========
Securities available for sale:
U.S. Treasury and federal agencies............ $ 38,759 $ $ (873) $ 37,886
Mortgage backed obligations of federal
agencies................................... 11,396 98 (714) 10,780
State and political subdivisions.............. 2,734 (92) 2,642
---------- ---------- ---------- ----------
Total...................................... $ 52,889 $ 98 $ (1,679) $ 51,308
========= ======== ========= =========
</TABLE>

<TABLE>
<CAPTION>
DECEMBER 31, 1993
----------------------------------------------------
AMORTIZED UNREALIZED UNREALIZED MARKET
COST GAINS LOSSES VALUE
---------- ---------- ---------- ----------
(thousands of dollars)
<S> <C> <C> <C> <C>
Securities held to maturity:
U.S. Treasury and federal agencies............ $1,410,917 $ 24,639 $ (2,477) $1,433,079
Mortgage backed obligations of federal
agencies................................... 332,737 15,041 (700) 347,078
State and political subdivisions.............. 905,396 24,287 (1,340) 928,343
Corporate debt................................ 70,494 1,067 (228) 71,333
Equity securities............................. 13,745 13,745
Other......................................... 101,016 101,016
---------- ---------- ---------- ----------
Total...................................... $2,834,305 $ 65,034 $ (4,745) $2,894,594
========= ======== ========= =========
</TABLE>

34
<PAGE> 36

The amortized cost and approximate market value of securities at December
31, 1994, by contractual maturity, are shown below. Maturities of mortgage
backed obligations were estimated based on anticipated payments.

<TABLE>
<CAPTION>
SECURITIES SECURITIES
HELD TO MATURITY AVAILABLE FOR SALE
------------------------ ------------------------
AMORTIZED MARKET AMORTIZED MARKET
COST VALUE COST VALUE
---------- ---------- ---------- ----------
(thousands of dollars)
<S> <C> <C> <C> <C>
Due in one year or less....................... $ 611,692 $ 608,941 $ 1,740 $ 1,706
Due after one year through five years......... 1,892,240 1,826,161 16,728 16,178
Due after five years through ten years........ 610,395 595,578 32,058 31,436
Due after 10 years............................ 192,178 180,572 2,363 1,988
---------- ---------- ---------- ----------
3,306,505 3,211,252 $ 52,889 $ 51,308
========= =========
Equity securities............................. 33,406 33,406
---------- ----------
Total....................................... $3,339,911 $3,244,658
========= =========
</TABLE>

Gross gains of $78,000, $232,000 and $1,106,000 and gross losses of $2,000,
$50,000 and $125,000 were realized on securities sales in 1994, 1993 and 1992,
respectively.

The amortized cost of securities pledged to secure public or trust
deposits, securities sold under repurchase agreements and for other purposes as
required or permitted by law was $806,461,000 at December 31, 1994 and
$712,696,000 at December 31, 1993.

NOTE 5. LOANS

The composition of loans, including lease financing receivables, is
summarized below. Loans are presented net of unearned discount which amounted to
$17,989,000 and $10,938,000 at December 31, 1994 and 1993, respectively.
Commercial loans pledged to secure public deposits were $5,526,000 on December
31, 1994 and $15,444,000 on December 31, 1993. Firstar serviced $2,551 million,
$2,045 million and $1,672 million of mortgage loans for other investors as of
December 31, 1994, 1993 and 1992, respectively. Residential mortgage loans held
for resale were $22,511,000 and $215,950,000 on December 31, 1994 and 1993,
respectively.

<TABLE>
<CAPTION>
DECEMBER 31
------------------------
1994 1993
---------- ----------
(thousands of dollars)
<S> <C> <C>
Commercial and industrial............................................ $2,753,251 $2,470,454
Real estate--construction............................................ 272,266 209,181
Real estate--mortgage................................................ 2,014,262 1,739,608
Foreign.............................................................. 32,395 31,269
Other................................................................ 905,795 855,249
---------- ----------
Commercial......................................................... 5,977,969 5,305,761
Credit card.......................................................... 573,157 546,051
Real estate--mortgage................................................ 1,360,088 1,363,671
Home equity.......................................................... 522,201 445,135
Other................................................................ 1,394,612 1,323,200
---------- ----------
Consumer........................................................... 3,850,058 3,678,057
---------- ----------
Total........................................................... $9,828,027 $8,983,818
========= =========
</TABLE>

35
<PAGE> 37

Loans on which income is recognized only as cash payments are received or
is accrued at less than the original contract rate are summarized below.

<TABLE>
<CAPTION>
DECEMBER 31
--------------------------------
1994 1993 1992
-------- -------- --------
(thousands of dollars)
<S> <C> <C> <C>
Commercial.................................................... $ 44,060 $ 48,233 $ 48,690
Consumer...................................................... 5,307 6,417 8,138
-------- -------- --------
Total....................................................... $ 49,367 $ 54,650 $ 56,828
======== ======== ========
</TABLE>

The effect of nonperforming loans on interest revenue was as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
--------------------------------
1994 1993 1992
-------- -------- --------
(thousands of dollars)
<S> <C> <C> <C>
Interest at original contract rate............................ $ 6,485 $ 6,586 $ 7,593
Interest collected............................................ 3,127 2,567 1,721
-------- -------- --------
Net reduction of interest revenue........................... $ 3,358 $ 4,019 $ 5,872
======== ======== ========
</TABLE>

Certain executive officers, directors, shareholders, and their associates
of Firstar and significant subsidiaries are loan customers of the banking
subsidiaries. Loans outstanding to such parties were $101.1 million on December
31, 1994 and $109.3 million on December 31, 1993. During 1994 new loans of $16.5
million were made and loan payments of $24.7 million were received. These loans
were made in the ordinary course of business and on substantially the same terms
as those prevailing for comparable transactions with other persons.

NOTE 6. RESERVE FOR LOAN LOSSES

An analysis of the reserve for loan losses is as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
--------------------------------
1994 1993 1992
-------- -------- --------
(thousands of dollars)
<S> <C> <C> <C>
Balance at beginning of year.................................. $174,873 $168,482 $150,628
Provision for loan losses..................................... 17,139 24,567 44,821
Loan recoveries............................................... 18,579 16,840 17,962
Loan charge-offs.............................................. (41,488) (37,495) (51,062)
Reserves of acquired banks.................................... 3,503 2,479 6,133
-------- -------- --------
Balance at end of year...................................... $172,606 $174,873 $168,482
======== ======== ========
Charge-offs, net of recoveries, as a percentage of average
loans....................................................... .25% .25% .43%
Reserve as a percentage of year-end loans..................... 1.76 1.95 2.08
</TABLE>

The Financial Accounting Standards Board issued Statement No. 114,
"Accounting by Creditors for Impairment of a Loan", which is effective in 1995.
The Statement established procedures for determining the appropriate reserve for
loan losses for loans deemed impaired. The calculation of reserve levels would
be based upon the discounted present value of expected cash flows received from
the debtor or other measures of value such as market prices or collateral
values. This statement was adopted January 1, 1995 and did not have any
significant impact on the current level of the reserve for loan losses and is
not expected to effect 1995 operating results.

36
<PAGE> 38

NOTE 7. BANK PREMISES AND EQUIPMENT

Bank premises and equipment are summarized as follows:

<TABLE>
<CAPTION>
DECEMBER 31
------------------------
1994 1993
---------- ---------
(thousands of dollars)
<S> <C> <C>
Land................................................................ $ 36,981 $ 31,373
Bank premises....................................................... 286,048 253,062
Equipment........................................................... 247,551 228,187
---------- ---------
Subtotal.......................................................... 570,580 512,622
Accumulated depreciation............................................ (276,554) (248,053)
---------- ---------
Total............................................................. $ 294,026 $ 264,569
========= =========
</TABLE>

Depreciation charged to other operating expense amounted to $34,187,000,
$34,385,000 and $33,418,000 in 1994, 1993 and 1992, respectively. Rental expense
for bank premises and equipment amounted to $30,045,000, $30,079,000 and
$28,843,000 in 1994, 1993 and 1992, respectively. Contingent rentals and
sublease rental income amounts were not significant.

Occupancy expense is net of amortization of a total of $68 million of
pre-tax deferred gain on a building sale which is being amortized through 1997,
at which time the related leaseback expires. This amortization was $9,029,000 in
1994 and $6,312,000 in 1993 and 1992.

Firstar and its subsidiaries are obligated under noncancellable operating
leases for various bank premises and equipment. These leases expire
intermittently over the years through 2034. The minimum rental commitments under
noncancellable leases for the next five years are shown below.

<TABLE>
<CAPTION>
PERIOD AMOUNT
---------- ---------
(thousands of dollars)
<S> <C> <C>
Bank premises and equipment........................................... 1995 $ 18,710
1996 17,889
1997 17,414
1998 15,331
1999 14,627
</TABLE>

NOTE 8. SHORT-TERM BORROWED FUNDS

Short-term borrowed funds are summarized as follows:

<TABLE>
<CAPTION>
1994 1993 1992
---------- ---------- ---------
(thousands of dollars)
<S> <C> <C> <C>
Federal funds purchased and repurchase agreements:
At December 31........................................ $2,090,056 $1,032,438 $ 785,967
Average during year................................... 1,476,677 745,865 622,227
Maximum month-end balance............................. 2,090,056 1,051,567 808,393
Average rate at year-end.............................. 5.59% 2.90% 2.62%
Average rate during year.............................. 4.28 2.84 3.32
</TABLE>

Federal funds purchased, which totaled $1,636 million at December 31, 1994,
generally represent one-day borrowings obtained primarily from financial
institutions in Firstar's marketplace in conjunction with their customer
correspondent relationships with the subsidiary banks. Securities sold under
repurchase agreements, which totaled $454 million at December 31, 1994,
represent borrowings maturing within one year that are secured by U.S. Treasury
and federal agency securities. Other short-term borrowed funds comprise
primarily treasury, tax and loan notes.

37
<PAGE> 39

NOTE 9. LONG-TERM DEBT

Long-term debt is summarized as follows:

<TABLE>
<CAPTION>
DECEMBER 31
--------------------------
1994 1993
----------- -----------
(thousands of dollars)
<S> <C> <C>
10 1/4% subordinated notes......................................... $ 78,340 $ 78,405
10% notes.......................................................... 43,910 44,200
Other debt......................................................... 12,838 3,670
----------- -----------
Total............................................................ $ 135,088 $ 126,275
========== ==========
</TABLE>

Firstar issued $100,000,000 of 10 1/4% notes under an indenture dated as of
May 1, 1988. The notes, which are subordinated to all unsubordinated
indebtedness of Firstar for borrowed money, are unsecured and mature May 1,
1998. The indenture contains a provision which restricts the disposition of or
subjecting to lien any common stock of certain subsidiaries.

Firstar issued $50,000,000 of 10% notes under an indenture dated as of June
1, 1986. The notes are unsecured and mature June 1, 1996. The indenture contains
a provision which restricts the disposition of or subjecting to lien any common
stock of certain subsidiaries.

Other debt at December 31, 1994 includes notes of $2,706,000 which bear
interest at 11.50% and mature in 1996 and loans sold under a repurchase
agreement of $10,000,000 which mature in 1999 and bear interest at a variable
LIBOR based rate.

Long-term debt has aggregate maturities for the five years 1995 through
1999 as follows: $75,000 in 1995, $46,616,000 in 1996, $78,397,000 in 1998 and
$10,000,000 in 1999.

Firstar has repurchased portions of the 10 1/4% and 10% notes and incurred
losses of $25,000, $57,000 and $605,000, in 1994, 1993 and 1992, respectively.

NOTE 10. STOCKHOLDERS' EQUITY

The authorized and outstanding shares of Firstar are as follows:

<TABLE>
<CAPTION>
DECEMBER 31
--------------------------
1994 1993
----------- -----------
<S> <C> <C>
Preferred stock, $1.00 par value
Authorized--series C............................................. 2,500,000 2,500,000
Common stock, $1.25 par value:
Authorized....................................................... 120,000,000 120,000,000
Outstanding (net of treasury stock).............................. 65,873,436 64,360,819
</TABLE>

Under the Firstar Shareholder rights plan each share of common stock
entitles its holder to one-half right. Under certain conditions, each right
entitles the holder to purchase one one-hundredth of a share of series C
preferred stock at a price of $85, subject to adjustment. The rights will only
be exercisable if a person or group has acquired, or announced an intention to
acquire, 20% or more of the outstanding shares of Firstar common stock. Under
certain circumstances, including the existence of a 20% acquiring party, each
holder of a right, other than the acquiring party, will be entitled to purchase
at the exercise price Firstar common shares having a market value of two times
the exercise price. In the event of the acquisition of Firstar by another
company subsequent to a party acquiring 20% or more of Firstar common stock,
each holder of a right is entitled to receive the acquiring company's common
shares having a market value of two times the exercise price. The rights may be
redeemed at a price of $.01 per right prior to the existence of a 20% acquiring
party, and thereafter, may be exchanged for one common share per right prior to
the existence of a 50% acquiring party. The rights will expire on January 19,
1999. The rights do not have voting or dividend rights and until

38
<PAGE> 40

they become exercisable, have no dilutive effect on the earnings of Firstar.
Under the rights plan, the Board of Directors of Firstar may reduce the
thresholds applicable to the rights from 20% to not less than 10%.

Preferred shares, when issued, rank prior to common shares both as to
dividends and liquidation but have no general voting rights. The series C
preferred stock, none of which is outstanding, is entitled to 100 votes per
share and other rights such that the value of a one one-hundredth interest in a
series C preferred share should approximate the value of one common share.

Firstar redeemed all of its series B preferred stock on December 29, 1993
at $103 per share plus accrued dividends. Dividends deducted from net income for
purposes of determining net income applicable to common stockholders were
$3,266,000 in 1993 and $3,747,000 in 1992.

In conjunction with long-term incentive plans, 30,235 shares of restricted
common stock are being held in escrow for executive officers as of December 31,
1994. The shares cannot be sold prior to the end of a three-year period and are
subject to adjustment in accordance with the terms of the award.

Firstar reacquired 234,200 shares of its common stock during 1994 which are
expected to be reissued in 1995 in connection with a specific purchase business
combination.

On January 31, 1995 Firstar issued 38,775 shares of Series D preferred
stock in connection with its merger with First Colonial Bankshares Corporation.
These shares are convertible into 832,112 shares of Firstar common stock and are
redeemable after June 30, 1997.

NOTE 11. STOCK OPTIONS

Firstar has an incentive stock plan that provides for a maximum grant of
5,600,000 stock options, stock appreciation rights and/or shares of stock. The
options expire ten years and one month after the date of grant.

The following table summarizes option activity under these plans:

<TABLE>
<CAPTION>
NUMBER OF
SHARES OPTION PRICE
---------- ----------------
<S> <C> <C>
Options outstanding at December 31, 1991......................... 1,082,176 $ 3.06 to $15.81
Granted........................................................ 354,800 25.13
Exercised...................................................... (155,914) 3.06 to 25.13
Cancelled...................................................... (19,200) 13.38 to 25.13
----------
Options outstanding at December 31, 1992......................... 1,261,862 4.37 to 25.13
Granted........................................................ 310,600 32.50
Exercised...................................................... (104,978) 4.37 to 15.81
Cancelled...................................................... (30,000) 13.38 to 32.50
----------
Options outstanding at December 31, 1993......................... 1,437,484 5.68 to 32.50
Granted........................................................ 368,900 30.88 to 31.25
Exercised...................................................... (85,384) 5.68 to 25.13
Cancelled...................................................... (10,900) 25.13 to 32.50
----------
Options outstanding at December 31, 1994......................... 1,710,100 11.38 to 32.50
========
</TABLE>

At December 31, 1994, options to acquire 989,500 shares were exercisable.
In January 1995, options to acquire 499,300 shares of common stock at $27.38 to
$27.50 per share were granted.

39
<PAGE> 41

NOTE 12. OTHER OPERATING EXPENSE

A summary of other operating expense is as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
--------------------------------
1994 1993 1992
-------- -------- --------
(thousands of dollars)
<S> <C> <C> <C>
F.D.I.C. insurance............................................ $ 23,789 $ 23,670 $ 22,488
Business development.......................................... 23,503 24,063 23,055
Stationery and supplies....................................... 16,456 19,060 18,123
Information processing expense................................ 16,233 14,996 14,544
Professional fees............................................. 14,958 15,336 14,040
Delivery...................................................... 14,585 15,452 15,840
Check kiting loss............................................. 22,000
Other......................................................... 53,819 59,393 64,438
-------- -------- --------
Total....................................................... $185,343 $171,970 $172,528
======== ======== ========
</TABLE>

NOTE 13. EMPLOYEE BENEFIT PLANS

Firstar and its subsidiaries have non-contributory defined benefit pension
plans covering substantially all employees. The benefits are based upon years of
service and the employee's compensation during the last five years of
employment. The funding policy is to contribute annually the minimum amount
necessary to satisfy federal minimum funding standards. Plan assets are
primarily invested in listed stocks and U.S. Treasury and federal agency
securities. The table below summarizes data relative to the plans.

<TABLE>
<CAPTION>
DECEMBER 31
--------------------------------
1994 1993 1992
-------- -------- --------
(thousands of dollars)
<S> <C> <C> <C>
Actuarial present value of benefit obligations:
Vested benefit obligation................................... $175,537 $168,978 $145,806
Accumulated benefit obligation.............................. 179,086 172,742 148,892
Projected benefit obligation................................ 218,660 215,931 190,405
Plan assets at fair value..................................... 195,436 205,941 190,667
Plan assets (less than) in excess of projected benefit
obligation.................................................. (23,224) (9,990) 262
Unrecognized prior service cost............................... (2,075) (2,360) (859)
Unrecognized net asset........................................ (5,914) (7,147) (8,381)
Unrecognized net loss (gain).................................. 18,797 4,341 (5,857)
-------- -------- --------
Pension liability........................................ $(12,416) $(15,156) $(14,835)
======== ======== ========
Net pension expense comprised the following:
Service cost................................................ $ 7,852 $ 7,176 $ 6,739
Interest cost on projected benefit obligation............... 16,355 15,705 14,389
Actual loss (return) on plan assets......................... 8,725 (20,008) (13,133)
Net amortization and deferral............................... (26,755) 2,994 (2,870)
-------- -------- --------
Net pension expense...................................... $ 6,177 $ 5,867 $ 5,125
======== ======== ========
Assumptions used in actuarial values:
Discount rate............................................... 8.50% 7.75% 8.25%
Rates of increase in compensation levels.................... 5.50 5.50 6.00
Expected rate of return on plan............................. 9.00 9.50 9.50
</TABLE>

40
<PAGE> 42

Firstar also has unfunded pension plans covering certain employees.
Interest rates used in calculating the actuarial values are essentially the same
as in the previously described plans. The table below summarizes data relative
to the plans.

<TABLE>
<CAPTION>
DECEMBER 31
--------------------------------
1994 1993 1992
-------- -------- --------
(thousands of dollars)
<S> <C> <C> <C>
Projected benefit obligation.................................. $(12,238) $ (9,275) $ (6,257)
Unrecognized prior service cost............................... 2,779
Unrecognized transition obligation............................ 189 232 275
Unrecognized net loss......................................... 2,641 3,847 1,486
-------- -------- --------
Pension liability........................................ $ (6,629) $ (5,196) $ (4,496)
======== ======== ========
Net pension expense comprised the following:
Service cost................................................ $ 436 $ 218 $ 131
Interest cost on projected benefit obligation............... 916 612 474
Net amortization and deferral............................... 416 211 122
-------- -------- --------
Net pension expense...................................... $ 1,768 $ 1,041 $ 727
======== ======== ========
</TABLE>

Firstar has profit sharing plans under which eligible employees can
participate by contributing a portion of their salary for investment in one or
more trust funds. Contributions are made to the account of each participant
based upon profitability or at the discretion of the board of directors. Amounts
expensed in connection with this plan were $10,382,000 in 1994, $9,667,000 in
1993 and $8,539,000 in 1992.

In addition to pension benefits, certain health care benefits are made
available to active and retired employees. The table below summarizes data
relative to this benefit program. The program is unfunded and the transition
obligation is being amortized over 20 years.

<TABLE>
<CAPTION>
DECEMBER 31
--------------------
1994 1993
-------- --------
(thousands of
dollars)
<S> <C> <C>
Accumulated postretirement benefit obligation:
Retirees.............................................................. $(41,029) $(33,507)
Fully eligible active plan participants............................... (7,340) (18,056)
Other active plan participants........................................ (13,290) (20,354)
-------- --------
Total.............................................................. (61,659) (71,917)
Unrecognized transition obligation.................................... 53,146 56,099
Unrecognized net (gain) loss.......................................... (4,872) 8,854
-------- --------
Postretirement benefit liability................................... $(13,385) $ (6,964)
======== ========
Net postretirement benefit expense comprised the following:
Service cost.......................................................... $ 1,220 $ 1,515
Interest cost......................................................... 4,721 4,938
Amortization of transition obligation................................. 2,953 2,953
-------- --------
Net postretirement benefit expense................................. $ 8,894 $ 9,406
======== ========
</TABLE>

For measurement purposes, an 11% annual rate of increase in the per capita
cost of covered health care benefits was assumed, decreasing to 6% by 2004 and
remaining at that level thereafter. The health care cost trend rate assumption
has an effect on the amounts reported. To illustrate, increasing the assumed
health care cost trend rates by one percentage point in each year would increase
the accumulated postretirement accumulated benefit obligation by $4,954,000 and
the aggregate of the service and interest cost components of net periodic
postretirement benefit cost by $405,000. The discount rate used in determining
the accumulated postretirement benefit obligation was 8.50% and 7.75% at
December 31, 1994 and 1993, respectively.

41
<PAGE> 43

NOTE 14. INCOME TAXES

Statement of Financial Accounting Standards No. 109, "Accounting for Income
Taxes", was adopted by Firstar on January 1, 1993. The cumulative effect of
adoption of Statement No. 109 did not have a significant effect on net income in
1993.

The taxes applicable to net income were as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
--------------------------------
1994 1993 1992
-------- -------- --------
(thousands of dollars)
<S> <C> <C> <C>
Current income taxes:
Federal..................................................... $ 85,747 $ 85,344 $ 66,746
State and other............................................. 18,755 18,238 14,862
-------- -------- --------
Subtotal................................................. 104,502 103,582 81,608
Deferred income taxes (benefit):
Federal..................................................... (1,358) (6,731) (9,229)
State and other............................................. (130) (856) (832)
-------- -------- --------
Subtotal................................................. (1,488) (7,587) (10,061)
Cumulative effect of change in accounting principle........... (2,279)
-------- -------- --------
Provision for income taxes............................... $103,014 $ 93,716 $ 71,547
======== ======== ========
</TABLE>

Income tax expense differed from the amount computed by applying the
federal statutory rate of 35% (34% in 1992) to income before taxes as shown
below:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
--------------------------------
1994 1993 1992
-------- -------- --------
(thousands of dollars)
<S> <C> <C> <C>
Tax expense at statutory rate................................. $108,969 $104,498 $ 80,991
Increase (reduction) in taxes resulting from:
Tax-exempt income........................................... (18,075) (18,486) (20,882)
State and local taxes--net of federal income tax benefit.... 12,106 11,298 9,260
Amortization of intangibles................................. 1,702 1,663 2,433
Cumulative effect of change in accounting principle......... (2,279)
Adjustment to deferred tax assets and liabilities for
enacted changes in tax laws and rates.................... (1,586)
Other--net.................................................. (1,688) (1,392) (255)
-------- -------- --------
Provision for income taxes............................... $103,014 $ 93,716 $ 71,547
======== ======== ========
</TABLE>

The significant components of deferred income tax expense attributable to
income from continuing operations are as follows:

<TABLE>
<CAPTION>
YEARS ENDED
DECEMBER 31
--------------------
1994 1993
-------- --------
(thousands of dollars)
<S> <C> <C>
Deferred tax expense (exclusive of the effects of other components
listed below)......................................................... $ (2,008) $ (6,699)
Adjustments to deferred tax assets and liabilities for enacted changes
in tax laws and rates................................................. (1,586)
Change in balance of the valuation allowance for deferred tax assets.... 520 698
-------- --------
Total.............................................................. $ (1,488) $ (7,587)
======== ========
</TABLE>

42
<PAGE> 44

The significant components of the net deferred tax asset were as follows:

<TABLE>
<CAPTION>
YEARS ENDED
DECEMBER 31
--------------------
1994 1993
-------- --------
(thousands of
dollars)
<S> <C> <C>
Deferred tax liabilities:
Depreciation of bank premises and equipment........................... $(12,176) $(11,741)
Equipment leased to customers......................................... (14,525) (16,188)
Difference in basis of certain acquired assets accounted for as a
purchase........................................................... (8,454) (10,195)
Deferred tax assets:
Pension costs......................................................... 11,675 9,190
Reserve for loan losses............................................... 69,109 70,005
Other real estate..................................................... 3,904 3,187
Deferred gain on sale of building..................................... 7,720 11,338
Deferred compensation................................................. 6,916 6,950
State and federal net operating loss carryforwards.................... 10,532 8,965
Other--net............................................................ 12,003 9,058
-------- --------
Subtotal........................................................... 86,704 80,569
Less valuation allowance................................................ (11,066) (9,271)
-------- --------
Net deferred tax asset............................................. $ 75,638 $ 71,298
======== ========
</TABLE>

The deferred tax asset increased due to tax benefits recorded on securities
which were marked-to-market in accordance with Statement No. 115 and the
acquisition of First Southeast Banking Corp.

The valuation allowance has been recognized primarily to offset deferred
tax assets related to state net operating loss carryforwards totaling
approximately $187,000,000 which expire at various times within the next 15
years. If realized, the tax benefit for these items will reduce current tax
expense for that period. Net deferred tax assets of $2,358,000 including a
valuation allowance of $1,275,000 were added in 1994 due to the acquisition of
First Southeast Banking Corp.

Other assets include net deferred income tax charges of $75,638,000 and
$71,298,000 at December 31, 1994 and 1993, respectively. Furthermore, amounts
originally reported for 1993 have been reclassified to reflect actual tax return
results.

NOTE 15. COMMITMENTS AND CONTINGENT LIABILITIES

Firstar has outstanding at any time a significant number of commitments to
extend credit to its customers. These commitments include revolving credit
agreements, term loan commitments, short-term borrowing agreements and standby
letters of credit. These commitments involve, to varying degrees, elements of
credit and interest rate risk in excess of the amounts recognized in the
consolidated balance sheets.

Commitments to extend credit are agreements to lend to a customer as long
as there is not a violation of any condition established in the contract.
Commitments generally have fixed expiration dates or other termination clauses
and may require payment of a fee. Since many of the commitments are expected to
expire without being drawn upon, the total commitment amounts do not necessarily
represent future cash requirements.

Credit card commitments are unsecured agreements to extend credit. Such
commitments are reviewed periodically, at which time the commitments may be
maintained, increased, decreased or canceled depending upon evaluation of the
customer's credit worthiness and other considerations.

43
<PAGE> 45

Standby and commercial letters of credit are conditional commitments issued
by Firstar to guarantee the performance of a customer to a third party. Those
guarantees are primarily issued to support public and private borrowing
arrangements, including commercial paper, bond financing and similar
transactions.

Firstar uses the same credit policies in making commitments and conditional
obligations as it does for on-balance sheet instruments. Firstar evaluates each
customer's credit worthiness on a case-by-case basis. The amount of collateral
obtained, if deemed necessary upon extension of credit, is based on management's
credit evaluation of the party.

Firstar originates and sells residential mortgage loans as a part of
various mortgage-backed security programs sponsored by United States government
agencies or government-sponsored agencies, such as the Federal Home Loan
Mortgage Corporation, the Federal National Mortgage Association and the
Government National Mortgage Association. These sales are often subject to
certain recourse provisions in the event of default by the borrower.

The following is a summary of such commitments:

<TABLE>
<CAPTION>
DECEMBER 31
---------------------
1994 1993
------ ------
(millions of dollars)
<S> <C> <C>
Commitments to extend credit........................................... $4,063 $3,763
Credit card lines...................................................... 1,541 1,364
Standby and commercial letters of credit............................... 404 349
Mortgage loans sold with recourse...................................... 30 21
</TABLE>

NOTE 16. REGULATORY RESTRICTIONS ON SUBSIDIARY DIVIDENDS AND CASH

Federal regulations require Firstar to maintain as reserves, minimum cash
balances based on deposit levels at subsidiary banks. Cash balances restricted
from usage due to these requirements were $248 million and $267 million at
December 31, 1994 and 1993, respectively.

Firstar's subsidiary banks are restricted by regulation as to the amount of
funds which can be transferred to the parent in the form of loans and dividends.
As of December 31, 1994, $128 million could be loaned to Firstar by the
subsidiary banks subject to strict collateral requirements, and $250 million
could be loaned to Firstar by the subsidiary banks in the form of dividends. In
addition each subsidiary bank could pay dividends to Firstar in an amount which
approximates Firstar's equity in their 1995 net income. The payment of dividends
by any subsidiary bank may also be affected by other factors beyond this
regulatory limitation, such as maintenance of adequate capital for such
subsidiary bank.

44
<PAGE> 46

NOTE 17. DERIVATIVE FINANCIAL INSTRUMENTS

Rate Risk Management

As part of its asset and liability management, Firstar uses various types
of interest rate contracts for the purpose of managing its interest rate risks.
The use of interest rate contracts enables Firstar to synthetically alter the
repricing characteristics of designated earning assets and interest-bearing
liabilities. The following tables summarize the notional amounts of interest
rate contracts at December 31, 1994, used by Firstar in its asset and liability
management process:

<TABLE>
<CAPTION>
INTEREST RATE SWAPS
-------------------------------------------
RECEIVE FIXED RATE TOTAL
------------------- INTEREST
INDEX RECEIVE PERIODIC CAPS AND RATE
AMORTIZING OTHER VARIABLE CAPS FLOORS CONTRACTS
---------- ----- -------- -------- -------- ---------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C>
December 31, 1992........................ $ $ 113 $ 91 $ $ 80 $ 284
Additions.............................. 200 10 50 720 120 1,100
Maturities............................. (63) (24) (20) (107)
---------- ----- -------- -------- -------- ---------
December 31, 1993........................ 200 60 117 720 180 1,277
Additions.............................. 90 50 210 241 591
Maturities............................. (35) (80) (40) (155)
---------- ----- -------- -------- -------- ---------
December 31, 1994........................ $290 $ 75 $ 37 $930 $381 $ 1,713
======== ==== ====== ====== ======= =======
</TABLE>

Index amortizing interest rate swaps are used to convert variable rate
loans to a fixed rate basis. The amortizing feature of these swaps serves to
extend the maturity after a predetermined mandatory period if the three-month
LIBOR index rate is above a pre-established reference rate on a quarterly basis.
Additionally, the notional amount of the swaps is reduced on a quarterly basis
based upon pre-established rates beginning in 1997.

Interest rate swaps used to convert fixed rate loans to variable rate loans
or vice versa have a total notional value of $112 million on December 31, 1994.

Interest rate swaps with periodic caps involve the exchange of LIBOR based
variable interest payments with one party receiving a fixed basis point shim
over the LIBOR index, subject to a 25 basis point cap in quarterly increases in
rates receivable by Firstar. These swaps were entered into in 1993 and early
1994, when interest rates were at cycle lows, to preserve the net interest
margin on variable rate loans which were funded by low cost savings and
transaction deposit accounts. These swaps hedge loans of $230 million and
deposits of $700 million.

Interest rate floors provide for the receipt of payments when the three
month LIBOR rate is below a predetermined interest rate floor. Firstar entered
into $195 million of floors to hedge variable rate loans against a decline in
interest rates. Floors were also entered into to hedge $106 million of deposits
where such deposits have a guaranteed interest rate.

Interest rate caps provide for the receipt of payments when the three month
LIBOR rate exceeds predetermined interest rate caps. These instruments manage
interest rate risk on certain securities and loans.

45
<PAGE> 47

The maturity range of derivative financial instruments as of December 31,
1994 is as follows:

<TABLE>
<CAPTION>
MATURITY RANGE OF DERIVATIVE FINANCIAL INSTRUMENTS
-------------------------------------------------------------------------------------------
MARKET
WEIGHTED VALUE
AVERAGE ASSET
1995 1996 1997 1998 1999 BEYOND TOTAL MATURITIES (LIABILITY)
---- ---- ---- ---- ---- ------ ------ ---------- -----------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Interest Rate Swaps
Receive variable........ $ 37 $ 37 .6 yr $ --
Average receive
rate................ 5.19% 5.19%
Average pay rate...... 5.56 5.56
Receive fixed........... $ 20 $ 55 $ 75 1.2 yrs (1.8)
Average receive
rate................ 6.39% 7.20% 6.99%
Average pay rate...... 6.75 7.07 6.99
Receive fixed
amortizing............ $100 $100 $ 90 $ 290 3.4 yrs (23.2)
Average receive
rate................ 4.90% 5.17% 6.00% 5.33%
Average pay rate...... 5.62 5.75 6.50 5.94
Periodic cap............ $ 5 $205 $620 $100 $ 930 2.3 yrs (38.8)
Average receive
rate................ 6.54% 4.91% 4.34% 4.86% 4.54%
Average pay rate...... 6.50 6.16 5.49 5.94 5.69
Interest Rate Floors...... $ 10 $ 50 $ 10 $201 $ 30 $ 301 4.3 yrs 1.2
Average floor rate...... 4.50% 4.70% 5.00% 5.04% 5.17% 4.98%
Interest Rate Caps........ $ 80 $ 80 .6 yr 1.2
Average cap rate........ 4.00% 4.00%
---- ---- ---- ---- ---- ------ ------ -----------
Total............... $142 $270 $770 $210 $291 $ 30 $1,713 2.7 yrs $ (61.4)
===== ===== ===== ===== ===== ======= ====== =========
</TABLE>

- ------------
All interest rates represent rates in effect on December 31, 1994.

Index rate for interest rate caps/floors is three month LIBOR.

The notional values of derivative financial instruments represent the
amounts on which interest payments are exchanged between the counterparties.
Those notional values do not represent direct credit exposures. Firstar is
exposed to credit-related losses in the event of nonperformance by
counterparties to these instruments but does not expect any counterparty to fail
to meet their obligations. Where appropriate, Firstar requires collateral based
upon the positive market value of the exposure taking into account bi-lateral
netting agreements with certain counterparties. Based on market values,
Firstar's credit exposure was $3.6 million at December 31, 1994.

Firstar enters into both mandatory and optional commitments to sell groups
of residential mortgage loans that it originates or purchases as part of its
mortgage banking activities. Firstar commits to sell the loans at specified
prices in a future period typically within 90 days. The risk associated with
these commitments consists primarily of loans not closing in sufficient volumes
and at appropriate yields to meet the sale commitments. Firstar had contracts
totaling $22 million and $202 million on December 31, 1994 and 1993
respectively. Gains or losses on these contracts are included in the
determination of the market value of mortgages held for sale.

46
<PAGE> 48

Trading Activities

Firstar also acts as an intermediary for customers in their management of
interest rate and foreign currency rate risk. In this regard, Firstar will enter
into interest rate swaps, caps, floors and foreign exchange contracts with
customers to minimize their exposure to market risk. Firstar enters into
essentially offsetting transactions with other counterparties. Customer related
derivative activity is marked to market value. The credit exposure at December
31, 1994 of $21.1 million is represented by the fair value of contracts with a
positive value. Gross credit exposure amounts disregard the value of any
collateral. Revenue from this intermediary activity was $3.2 million and $1.8
million in 1994 and 1993 respectively.

Information on these transactions is shown below:

<TABLE>
<CAPTION>
1994 1993
------------------------------- -------------------------------
ESTIMATED ESTIMATED
FAIR VALUE FAIR VALUE
NOTIONAL ------------------- NOTIONAL -------------------
AMOUNT YEAR-END AVERAGE AMOUNT YEAR-END AVERAGE
-------- -------- ------- -------- -------- -------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C>
Interest Rate Swaps:
In a receivable position............... $445 $ 18.2 $21.8 $590 $ 10.2 $11.3
In a payable position.................. 445 18.6 21.3 590 9.3 10.6
Interest Rate Caps/Floors:
Held................................... 115 2.2 1.3 36 .1 .1
Written................................ 115 2.2 1.3 36 .1 .1
Foreign Exchange Contracts:
In a receivable position............... 28 .7 1.0 39 1.5 N/A
In a payable position.................. 29 .7 1.1 38 1.4 N/A
</TABLE>

47
<PAGE> 49

NOTE 18. FAIR VALUE OF FINANCIAL INSTRUMENTS

Statement of Financial Accounting Standards No. 107, "Disclosures about
Fair Value of Financial Instruments", requires that Firstar disclose estimated
fair values for its financial instruments. Fair value estimates were based on
relevant market data and information about the various financial instruments.
These estimates do not reflect any premium or discount that could result from
offering for sale at one time Firstar's entire holdings of a particular
financial instrument. Because no market exists for a significant portion of
Firstar's financial instruments, fair value estimates are based on judgements
regarding current economic conditions, risk characteristics of various financial
instruments, future expected loss experience, and other factors. These estimates
are subjective and involve uncertainties and matters of significant judgement
and therefore cannot be determined with precision. Changes in assumptions could
significantly affect the estimates.

Fair value estimates are based on existing on and off balance sheet
financial instruments without attempting to estimate the value of anticipated
future business and the value of assets and liabilities which are not considered
financial instruments. Significant assets that are not considered financial
instruments include goodwill, core deposit intangibles, certain customer
relationships and fixed assets. In addition, the tax ramifications related to
the realization of the unrealized gains and losses can have a significant effect
on fair value estimates and have not been considered.

Fair value estimates, methods, and assumptions are set forth below for
Firstar's financial instruments.

Cash and short-term investments--The carrying amounts for short-term
investments (which include interest-bearing deposits with banks, federal funds
sold and resale agreements) approximate fair value because they mature in 90
days or less and do not represent unanticipated credit concerns.

Securities--Estimated fair value for securities is based on quoted market
prices. The fair value of certain small issues and municipal securities which
are not readily available through market quotations is assumed to equal carrying
value as these securities generally have short terms. These securities do not
represent a significant portion of the portfolio.

Loans--Fair values were estimated for loans with similar financial
characteristics. The commercial loan portfolio was separated into credit risk
categories by variable and fixed rate loans. The fair value of performing loans,
except for internally criticized commercial and lease financing loans, was
calculated by discounting cash flows using an estimated discount rate that
reflects current market rates, the type of loan, credit risk inherent in the
loan category and repricing characteristics. Fair value for criticized
commercial loans was calculated by reducing the carrying value by an amount that
reflects the estimated principal loss. This loss was based on internal credit
analysis of specific borrowers taking into consideration past loan loss
experience and trends in loan quality. For lease financing loans, carrying value
was considered to approximate fair value.

The fair value of credit card loans was estimated using the net present
value method. Credit card portfolios are not actively traded and the discount
rate used reflects an estimated rate of return based on the credit quality of
the portfolio. This estimate does not include the value that relates to
estimated cash flows from new loans generated from existing cardholders over the
remaining life of the portfolio. For residential mortgages, fair value was
estimated by discounting cash flows adjusted for anticipated prepayments using
discount rates based on current market rates for similar loans.

Deposits--The fair value of deposits with no stated maturity, such as
interest bearing and non-interest bearing demand, savings and money market
accounts, is equal to the amount payable on demand. The fair value of
certificates of deposit is based on the discounted value of contractual cash
flows using current market rates for similar types of deposits.

48
<PAGE> 50

Borrowed funds--The carrying value of short-term borrowed funds approximate
fair value as they are payable within three months or less. The estimated fair
value of long-term debt is based on broker quotations, when available. Debt for
which quoted prices were not available was valued using cash flows discounted at
a current market rate for similar types of debt.

Derivative financial instruments--The fair value of interest rate swap
agreements is based on the present value of the swap primarily using dealer
quotes. Fair values for caps and floors were obtained using an option pricing
model. These values represent the estimated amount Firstar would receive or pay
to terminate the contracts or agreements taking into account current interest
rates and market volatility. The fair value of commitments to extend credit and
standby letters of credit was estimated using fees currently charged to enter
into similar agreements. The fair value of credit card lines is based on
cardholder fees currently being charged.

The estimated fair value of Firstar's financial instruments is summarized
as follows:

<TABLE>
<CAPTION>
DECEMBER 31, 1994 DECEMBER 31, 1993
------------------------- -------------------------
CARRYING ESTIMATED CARRYING ESTIMATED
VALUE FAIR VALUE VALUE FAIR VALUE
---------- ----------- ---------- -----------
(thousands of dollars)
<S> <C> <C> <C> <C>
Financial assets:
Cash and short-term investments............. $1,346,532 $ 1,346,532 $1,515,802 $ 1,515,802
Trading securities.......................... 29,050 29,050 12,491 12,491
Securities available for sale............... 51,308 51,308
Securities held to maturity................. 3,339,911 3,244,658 2,834,305 2,894,594
Loans, net of allowance for loan losses..... 9,655,421 9,468,169 8,808,945 9,022,477
Financial liabilities:
Deposits:
Without stated maturities................ 7,423,390 7,423,390 7,714,095 7,714,095
With stated maturities................... 3,811,623 3,804,196 3,449,519 3,474,675
Short-term borrowed funds................... 2,141,456 2,141,456 1,112,490 1,112,490
Long-term debt.............................. 135,088 140,321 126,275 145,018
Derivative financial contracts:
Asset and liability management:
Interest rate contracts:
Asset.................................. 3,585 3,611
Liability.............................. 64,405 3,706
Credit commitments.......................... 12,955 14,940
As intermediary for customers:
Interest rate contracts:
Asset.................................. 20,564 20,564 10,304
Liability.............................. 20,916 20,916 9,388
Foreign exchange contracts:
Asset.................................. 740 740 1,535 1,535
Liability.............................. 659 659 1,354 1,354
</TABLE>

49
<PAGE> 51

NOTE 19. PARENT CORPORATION CONDENSED FINANCIAL STATEMENTS

BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31
------------------------
1994 1993
---------- ----------
(thousands of dollars)
<S> <C> <C>
Assets:
Cash and due from banks............................................ $ 670 $ 124
Short-term investments............................................. 70,950 52,485
Commercial loans................................................... 424 694
Loans to bank subsidiaries......................................... 35,000 25,000
Loans to other subsidiaries........................................ 3,758 8,018
Investment in bank subsidiaries.................................... 1,316,668 1,193,505
Investment in other subsidiaries................................... 15,668 13,473
Other assets....................................................... 7,266 6,166
---------- ----------
Total assets.................................................... $1,450,404 $1,299,465
========= =========
Liabilities and stockholders' equity:
Long-term debt..................................................... $ 124,956 $ 125,311
Other liabilities.................................................. 18,920 18,257
Stockholders' equity............................................... 1,306,528 1,155,897
---------- ----------
Total liabilities and stockholders' equity...................... $1,450,404 $1,299,465
========= =========
</TABLE>

STATEMENTS OF INCOME

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
--------------------------------------
1994 1993 1992
---------- ---------- ----------
(thousands of dollars)
<S> <C> <C> <C>
Revenue:
Dividends from bank subsidiaries....................... $ 119,920 $ 135,519 $ 90,611
Dividends from other subsidiaries...................... 4,000 4,024 2,000
Fees from subsidiaries................................. 22,859 21,566 20,005
Investment and loan income............................. 4,897 3,784 3,834
Other revenue.......................................... 1,201 1,673 148
---------- ---------- ----------
Total revenue....................................... 152,877 166,566 116,598
Expense:
Interest............................................... 12,748 13,045 13,578
Salaries and employee benefits......................... 16,003 15,267 14,182
Other expense.......................................... 12,396 10,508 13,290
---------- ---------- ----------
Total expense....................................... 41,147 38,820 41,050
Income before income taxes and equity in undistributed
income of subsidiaries................................. 111,730 127,746 75,548
Provision for income tax expense (benefits).............. (5,413) 8,151 (5,216)
---------- ---------- ----------
Income before equity in undistributed income of
subsidiaries........................................... 117,143 119,595 80,764
Equity in undistributed income of subsidiaries........... 90,600 84,699 85,221
---------- ---------- ----------
Net income.......................................... $ 207,743 $ 204,294 $ 165,985
========= ========= =========
</TABLE>

50
<PAGE> 52

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
---------------------------------
1994 1993 1992
-------- --------- --------
(thousands of dollars)
<S> <C> <C> <C>
Cash flows from operating activities:
Net income................................................. $207,743 $ 204,294 $165,985
Adjustments:
Equity in undistributed income of subsidiaries.......... (90,600) (84,699) (85,221)
Depreciation, amortization and accretion................ 813 733 729
(Increase) decrease in other assets..................... (991) 10,527 (4,397)
Increase in other liabilities........................... 185 3,153 785
Other net............................................... 30 406 1,216
-------- --------- --------
Net cash provided by operating activities............. 117,180 134,414 79,097
Cash flows from investing activities:
Net (increase) decrease in short-term investments.......... (18,465) (18,335) 23,615
Net decrease (increase) in commercial loans................ 270 174 (1,513)
Net (increase) decrease in loans to subsidiaries........... (5,740) 5,978 2,566
Purchases of premises and equipment........................ (1,031) (902) (328)
Funds invested in acquisitions............................. (12,730)
Capital contributions to subsidiaries...................... (5,950) (710) (10,300)
Purchase of minority shares of subsidiaries................ (9) (591) (779)
Net decrease (increase) in intercompany receivables........ 622 (956) 168
Other net.................................................. 206 167 (451)
-------- --------- --------
Net cash (used in) provided by investing activities... (30,097) (15,175) 248
Cash flows from financing activities:
Repayment of long-term debt................................ (380) (366) (6,428)
Cash dividends............................................. (75,081) (67,453) (53,204)
Preferred stock redemption................................. (51,500)
Common stock transactions.................................. (11,076) 138 (19,788)
-------- --------- --------
Net cash used in financing activities................. (86,537) (119,181) (79,420)
-------- --------- --------
Net increase (decrease) in cash and due from banks........... 546 58 (75)
Cash and due from banks at beginning of year................. 124 66 141
-------- --------- --------
Cash and due from banks at end of year....................... $ 670 $ 124 $ 66
======== ========= ========
Supplemental disclosures of cash flow information:
Cash paid during the year for interest..................... $ 12,753 $ 12,829 $ 13,672
</TABLE>

51
<PAGE> 53

[KPMG Letterhead]

INDEPENDENT AUDITORS' REPORT

The Board of Directors
Firstar Corporation:

We have audited the accompanying consolidated balance sheets of Firstar
Corporation and subsidiaries as of December 31, 1994 and 1993, and the related
consolidated statements of income, stockholders' equity and cash flows for each
of the years in the three-year period ended December 31, 1994. These
consolidated financial statements are the responsibility of the Corporation's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

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

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Firstar
Corporation and subsidiaries at December 31, 1994 and 1993, and the results of
their operations and their cash flows for each of the years in the three-year
period ended December 31, 1994, in conformity with generally accepted accounting
principles.

[Signature]

KPMG Peat Marwick LLP

Milwaukee, Wisconsin
January 19, 1995

52
<PAGE> 54

FIRSTAR CORPORATION AND SUBSIDIARIES
SUMMARY OF QUARTERLY FINANCIAL INFORMATION
(UNAUDITED)

<TABLE>
<CAPTION>
1994
--------------------------------------------
FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER
-------- -------- -------- --------
(thousands of dollars, except per share)
<S> <C> <C> <C> <C>
Interest revenue.................................... $214,649 $225,515 $237,656 $260,167
Interest expense.................................... 70,634 77,831 89,249 102,687
-------- -------- -------- --------
Net interest revenue................................ 144,015 147,684 148,407 157,480
Provision for loan losses........................... 2,958 2,642 2,674 8,865
Other operating revenue............................. 83,113 84,096 82,403 85,623
Other operating expense............................. 144,203 167,148 143,314 150,260
-------- -------- -------- --------
Income before income taxes.......................... 79,967 61,990 84,822 83,978
Provision for income taxes.......................... 26,745 19,485 28,953 27,831
-------- -------- -------- --------
Net income.......................................... $ 53,222 $ 42,505 $ 55,869 $ 56,147
======== ======== ======== ========
Per common share
Net income.......................................... $ .83 $ .66 $ .87 $ .86
Dividends........................................... .26 .30 .30 .30
Stock price ranges:
High.............................................. 34 3/4 35 3/8 35 1/8 30 7/8
Low............................................... 29 3/4 32 5/8 29 5/8 25 1/8
Close............................................. 33 35 3/8 31 26 7/8
</TABLE>

<TABLE>
<CAPTION>
1993
--------------------------------------------
FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER
-------- -------- -------- --------
(thousands of dollars, except per share)
<S> <C> <C> <C> <C>
Interest revenue.................................... $217,901 $216,253 $216,549 $216,251
Interest expense.................................... 78,149 75,409 74,037 71,303
-------- -------- -------- --------
Net interest revenue................................ 139,752 140,844 142,512 144,948
Provision for loan losses........................... 6,334 5,328 6,789 6,116
Other operating revenue............................. 79,325 84,285 88,058 90,597
Other operating expense............................. 141,739 144,882 147,885 153,238
-------- -------- -------- --------
Income before income taxes.......................... 71,004 74,919 75,896 76,191
Provision for income taxes.......................... 20,978 24,522 24,541 23,675
-------- -------- -------- --------
Net income.......................................... $ 50,026 $ 50,397 $ 51,355 $ 52,516
======== ======== ======== ========
Per common share
Net income.......................................... $ .78 $ .78 $ .79 $ .80
Dividends........................................... .22 .26 .26 .26
Stock price ranges:
High.............................................. 35 7/8 37 1/4 34 1/8 35 3/8
Low............................................... 29 7/8 29 1/2 31 5/8 29 3/8
Close............................................. 33 7/8 32 1/2 33 5/8 30 3/4
</TABLE>

53
<PAGE> 55

FIRSTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND FINANCIAL RATIOS

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
----------------------------------------------------
1994 1993 1992 1991 1990
-------- -------- -------- -------- --------
(thousands of dollars, except per share data)
<S> <C> <C> <C> <C> <C>
INTEREST REVENUE
Loans....................................... $761,672 $685,530 $693,594 $757,069 $769,384
Securities.................................. 165,975 174,652 191,736 206,577 195,366
Other....................................... 10,340 6,772 13,191 18,033 28,288
-------- -------- -------- -------- --------
Total interest revenue.................... 937,987 866,954 898,521 981,679 993,038
INTEREST EXPENSE
Deposits.................................... 262,128 261,634 321,405 438,799 474,114
Short-term borrowed funds................... 65,408 23,811 23,423 45,434 70,410
Long-term debt.............................. 12,865 13,453 14,541 16,850 18,560
-------- -------- -------- -------- --------
Total interest expense.................... 340,401 298,898 359,369 501,083 563,084
-------- -------- -------- -------- --------
NET INTEREST REVENUE........................ 597,586 568,056 539,152 480,596 429,954
Provision for loan losses................... 17,139 24,567 44,821 50,276 49,161
-------- -------- -------- -------- --------
NET INTEREST REVENUE AFTER LOAN LOSS
PROVISION................................. 580,447 543,489 494,331 430,320 380,793
OTHER OPERATING REVENUE
Trust and investment management fees........ 117,872 110,185 95,926 80,813 70,051
Service charges on deposit accounts......... 72,366 74,071 66,301 59,368 50,250
Credit card service revenue................. 55,779 53,316 51,867 54,594 51,562
Other....................................... 89,218 104,693 86,673 77,760 76,438
-------- -------- -------- -------- --------
Total other operating revenue............. 335,235 342,265 300,767 272,535 248,301
OTHER OPERATING EXPENSE
Salaries and employee benefits.............. 325,906 316,848 287,607 266,757 245,571
Equipment expense........................... 49,251 48,139 48,720 42,483 39,774
Net occupancy expense....................... 45,914 48,731 44,408 42,252 35,708
Other....................................... 183,854 174,026 176,831 164,044 143,747
-------- -------- -------- -------- --------
Total other operating expense............. 604,925 587,744 557,566 515,536 464,800
-------- -------- -------- -------- --------
INCOME BEFORE INCOME TAXES.................. 310,757 298,010 237,532 187,319 164,294
Provision for income taxes.................. 103,014 93,716 71,547 52,988 46,837
-------- -------- -------- -------- --------
NET INCOME.................................. $207,743 $204,294 $165,985 $134,331 $117,457
======== ======== ======== ======== ========
Per common share:
Net income................................ $ 3.22 $ 3.15 $ 2.62 $ 2.14 $ 1.82
Dividends................................. 1.16 1.00 .80 .705 .635
Return on average total assets.............. 1.51% 1.59% 1.36% 1.16% 1.06%
Return on average common equity............. 16.97 18.61 17.43 15.85 14.83
Dividend payout ratio....................... 36.02 31.75 30.53 32.94 34.89
Equity as a percentage of assets:
At year-end............................... 8.65 8.38 7.96 7.44 7.03
Average for the year...................... 8.87 8.79 8.06 7.50 7.41
Full-time equivalent staff (at year-end).... 8,716 8,608 8,246 7,709 7,791
Number of common stockholders (at
year-end)................................. 9,896 9,990 9,652 8,742 9,422
Average common shares outstanding (000's)... 64,611 63,747 61,879 60,998 61,218
</TABLE>

54
<PAGE> 56

FIRSTAR CORPORATION AND SUBSIDIARIES

CONSOLIDATED AVERAGE BALANCE SHEETS, NET INTEREST REVENUE AND RATE ANALYSIS
<TABLE>
<CAPTION>
1994 1993 1992
------------------------------- ------------------------------- -------------------------------
AVERAGE AVERAGE AVERAGE AVERAGE AVERAGE AVERAGE
BALANCE INTEREST RATE BALANCE INTEREST RATE BALANCE INTEREST RATE
----------- -------- ------- ----------- -------- ------- ----------- -------- -------
(thousands of dollars)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Interest-bearing deposits
with banks................ $ 4,902 $ 288 5.88% $ 33,043 $ 1,385 4.19% $ 67,864 $ 2,608 3.84%
Federal funds sold and
resale agreements......... 200,039 8,841 4.42 147,744 4,602 3.11 277,075 9,791 3.53
Trading securities......... 22,123 1,560 7.05 17,332 985 5.68 15,514 1,012 6.52
Securities:
Taxable................... 2,046,687 122,790 6.00 2,005,584 129,593 6.46 1,913,174 140,652 7.35
Nontaxable................ 913,442 64,993 7.12 923,451 67,780 7.34 931,803 74,934 8.04
----------- -------- ----------- -------- ----------- --------
Total securities........ 2,960,129 187,783 6.34 2,929,035 197,373 6.74 2,844,977 215,586 7.58
Loans:
Commercial................ 5,519,600 448,190 8.12 4,936,620 385,322 7.81 4,519,772 382,129 8.45
Consumer.................. 3,741,809 320,347 8.56 3,396,343 306,658 9.03 3,115,162 319,102 10.24
----------- -------- ----------- -------- ----------- --------
Total loans............. 9,261,409 768,537 8.30 8,332,963 691,980 8.30 7,634,934 701,231 9.18
----------- -------- ----------- -------- ----------- --------
Interest earning assets... 12,448,602 967,009 7.77 11,460,117 896,325 7.82 10,840,364 930,228 8.58
Reserve for loan losses.... (175,393) (173,224) (160,642)
Cash and due from banks.... 873,275 938,407 855,297
Other assets............... 650,363 631,939 634,794
----------- ----------- -----------
Total assets.......... $13,796,847 $12,857,239 $12,169,813
=========== =========== ===========
LIABILITIES AND
STOCKHOLDERS' EQUITY
Interest-bearing demand.... $ 1,412,178 $ 18,173 1.29% $ 1,418,061 $ 23,666 1.67% $ 1,280,893 $ 31,977 2.50%
Money market accounts...... 1,580,884 44,416 2.81 1,555,455 38,968 2.51 1,538,279 49,555 3.22
Savings passbook........... 1,542,044 36,112 2.34 1,490,209 38,214 2.56 1,239,367 40,247 3.25
Certificates of deposit.... 3,605,420 163,427 4.53 3,537,120 160,786 4.55 3,734,726 199,626 5.35
Short-term borrowed
funds..................... 1,525,982 65,408 4.29 822,580 23,811 2.89 692,879 23,423 3.38
Long-term debt............. 126,184 12,865 10.20 133,135 13,453 10.10 146,748 14,541 9.91
----------- -------- ----------- -------- ----------- --------
Interest-bearing
liabilities............. 9,792,692 340,401 3.48 8,956,560 298,898 3.34 8,632,892 359,369 4.16
Demand deposits............ 2,533,883 2,531,844 2,323,260
Other liabilities.......... 246,323 238,645 232,773
Stockholders' equity....... 1,223,949 1,130,190 980,888
----------- ----------- -----------
Total liabilities and
stockholders'
equity.............. $13,796,847 $12,857,239 $12,169,813
=========== =========== ===========
Net interest
revenue/margin............ $626,608 5.03% $597,427 5.21% $570,859 5.27%
======== ======== ========

<CAPTION>
1991 1990
--------------------------------- ---------------------------------
AVERAGE AVERAGE AVERAGE AVERAGE
BALANCE INTEREST RATE BALANCE INTEREST RATE
----------- ---------- ------- ----------- ---------- -------

<S> <C> <C> <C> <C> <C> <C>
ASSETS
Interest-bearing deposits
with banks................ $ 59,003 $ 4,238 7.18% $ 64,772 $ 5,668 8.75%
Federal funds sold and
resale agreements......... 232,272 13,016 5.60 265,280 21,572 8.13
Trading securities......... 13,089 989 7.56 15,068 1,331 8.83
Securities:
Taxable................... 1,881,714 155,821 8.28 1,701,890 147,506 8.67
Nontaxable................ 813,033 75,327 9.26 734,592 71,133 9.68
----------- ---------- ----------- ----------
Total securities........ 2,694,747 231,148 8.58 2,436,482 218,639 8.97
Loans:
Commercial................ 4,399,308 439,212 9.98 4,247,266 462,684 10.89
Consumer.................. 2,917,125 328,633 11.27 2,754,243 319,319 11.59
----------- ---------- ----------- ----------
Total loans............. 7,316,433 767,845 10.49 7,001,509 782,003 11.17
----------- ---------- ----------- ----------
Interest earning assets... 10,315,544 1,017,236 9.86 9,783,111 1,029,213 10.52
Reserve for loan losses.... (144,714) (124,955)
Cash and due from banks.... 810,141 838,644
Other assets............... 641,521 607,499
----------- -----------
Total assets.......... $11,622,492 $11,104,299
=========== ===========
LIABILITIES AND
STOCKHOLDERS' EQUITY
Interest-bearing demand.... $ 1,086,022 $ 45,490 4.19% $ 958,890 $ 44,370 4.63%
Money market accounts...... 1,356,638 67,690 4.99 1,235,677 71,653 5.80
Savings passbook........... 1,017,324 48,789 4.80 945,242 48,199 5.10
Certificates of deposit.... 4,048,706 276,830 6.84 3,943,226 309,892 7.86
Short-term borrowed
funds..................... 840,780 45,434 5.40 913,330 70,410 7.71
Long-term debt............. 167,833 16,850 10.04 181,797 18,560 10.21
----------- ---------- ----------- ----------
Interest-bearing
liabilities............. 8,517,303 501,083 5.88 8,178,162 563,084 6.89
Demand deposits............ 2,001,692 1,877,794
Other liabilities.......... 231,662 225,920
Stockholders' equity....... 871,835 822,423
----------- -----------
Total liabilities and
stockholders'
equity.............. $11,622,492 $11,104,299
=========== ===========
Net interest
revenue/margin............ $ 516,153 5.00% $ 466,129 4.76%
========== ==========
</TABLE>

Interest and rates are calculated on a taxable equivalent basis, using a tax
rate of 35% in 1994 and 1993 and 34% in 1992, 1991 and 1990. The rate
calculations include the effect of certain loans on which income is recognized
only as cash payments are received or is accrued at less than the original
contract rate.

55
<PAGE> 57

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

None

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The Notice of the 1995 Annual Meeting and Proxy Statement filed pursuant to
Regulation 14A is incorporated herein by reference.

The executive officers of Firstar Corporation are listed under Item 1 of
this document.

ITEM 11. EXECUTIVE COMPENSATION

The Notice of the 1995 Annual Meeting and Proxy Statement filed pursuant to
Regulation 14A is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The Notice of the 1995 Annual Meeting and Proxy Statement filed pursuant to
Regulation 14A is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The Notice of the 1995 Annual Meeting and Proxy Statement filed pursuant to
Regulation 14A is incorporated herein by reference.

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(A)1. FINANCIAL STATEMENTS

The following financial statements of Firstar Corporation are filed as a
part of this document under Item 8. Financial Statements and Supplementary Data.

Consolidated Balance Sheets as of December 31, 1994 and 1993

Consolidated Statements of Income for the Years Ended December 31,
1994, 1993 and 1992

Consolidated Statements of Stockholders' Equity for the Years Ended
December 31, 1994, 1993 and 1992

Consolidated Statements of Cash Flows for the Years Ended December 31,
1994, 1993 and 1992

Notes to Consolidated Financial Statements

Independent Auditors' Report

(A)2. FINANCIAL STATEMENT SCHEDULES

All financial statement schedules have been included in the consolidated
financial statements or are either not applicable or not significant.

56
<PAGE> 58

(A)3. EXHIBITS

<TABLE>
<S> <C>
3.1 Articles of incorporation of Firstar Corporation
3.2 By-Laws of Firstar Corporation (incorporated by reference to Exhibit 3.2 of the
Form 10-K for the year ended December 31, 1991)
4.2 Indenture dated as of June 1, 1986 between Firstar Corporation and Chemical
Bank, as Trustee, relating to 10% Notes due June 1, 1996 (incorporated by
reference to Exhibit 4(b) to Amendment No. 1 to Registration No. 33-5932 of
Firstar)
4.3 Indenture dated as of May 1, 1988 between Firstar Corporation and Chemical
Bank, as Trustee, relating to 10 1/4% Subordinated Notes due May 1, 1998
(incorporated by reference to Exhibit 4(a) to Amendment No. 1 to Registration
No. 33-21527 of Firstar)
4.4 Shareholder Rights Plan of Firstar Corporation (incorporated by reference to
Exhibit 4 of Form 8-K dated January 19, 1989 of Firstar)
10.1 Collective Bargaining Agreement between Firstar Bank Milwaukee, N.A. and
Firstar Bank Milwaukee Employees Association dated July 30, 1993 (incorporated
by reference to Exhibit 10.1 of the Form 10-Q of Firstar for the quarter ended
September 30, 1993)
10.3 Directors' Deferred Compensation Plan, as amended (incorporated by reference to
Exhibit 10.3 of the Annual Report Form 10-K of Firstar for the year ended
December 31, 1988)
10.4* Key Executive Employment and Severance Agreement, as amended (incorporated by
reference to Exhibit 10.4 of the Form 10-Q of Firstar for the quarter ended
September 30, 1993)
10.5 First Colonial Bankshares Corporation 1988 Stock Option Plan, as amended,
assumed by Firstar (incorporated by reference to Exhibits 4.1 to 4.10 of
Registration No. 33-57521 of Firstar)
10.7* 1988 Incentive Stock Plan, as amended (incorporated by reference to Exhibit A
of the Notice of the 1994 Annual Meeting and Proxy Statement of Firstar)
10.8* Annual Executive Incentive Plan, as amended (incorporated by reference to
Exhibit B of the Notice of the 1994 Annual Meeting and Proxy Statement of
Firstar)
10.9* Long-Term Incentive Plan, as amended (incorporated by reference to Exhibit 10.9
of the Form 10-Q of Firstar for the quarter ended September 30, 1993)
10.10 Form of Indemnity Agreement between Firstar Corporation and its directors
(incorporated by reference to Exhibit 10 of the Quarterly Report on Form 10-Q
of Firstar for the quarter ended September 30, 1988)
21. Subsidiaries of Firstar Corporation
23. Consent of independent auditors
24. Powers of attorney
27. Financial data schedule
</TABLE>

- ------------
* Executive Compensation Plans

A copy of the exhibits listed herein can be obtained by writing to Mr.
William H. Risch, Senior Vice President-Finance and Treasurer, Firstar
Corporation, P.O. Box 532, Milwaukee, Wisconsin 53201.

(B) No reports on Form 8-K were filed during the fourth quarter of 1994.

57
<PAGE> 59

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

FIRSTAR CORPORATION

--------------------------------------
Roger L. Fitzsimonds
March 20, 1995 Chairman and Chief Executive Officer

Pursuant to the requirement of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.

<TABLE>
<S> <C>
- ----------------------------------------------- March 20, 1995
Roger L. Fitzsimonds
Chairman, Chief Executive Officer and director

March 20, 1995
- -----------------------------------------------
John A. Becker
President, Chief Operating Officer and director

March 20, 1995
- -----------------------------------------------
William H. Risch
Senior Vice President-Finance and Treasurer
(principal finance and accounting officer)
</TABLE>

DIRECTORS

Michael E. Batten* John H. Hendee, Jr.* Daniel F. McKeithan, Jr.*
Robert C. Buchanan* Jerry M. Hiegel* George W. Mead II*
George M. Chester, Jr.* Joe Hladky* Guy A. Osborn*
Roger H. Derusha* C. Paul Johnson* Judith D. Pyle*
James L. Forbes* James H. Keyes* Clifford V. Smith, Jr.*
Holmes Foster* Sheldon B. Lubar* William W. Wirtz*
Joseph F. Heil, Jr.*

<TABLE>
<S> <C>
*By March 20, 1995
- ---------------------------------------------
William H. Risch
Attorney-in-Fact
</TABLE>

58
<PAGE> 60
INDEX TO EXHIBITS

<TABLE>
<CAPTION>
Exhibit Number
<S> <C>
3.1 Articles of Incorporation of Firstar Corporation

21 Subsidiaries of Firstar Corporation

23 Consent of Independent Auditors

24 Powers of attorney

27 Financial data schedule
</TABLE>

<PAGE> 1
EXHIBIT 3.1

FIRSTAR CORPORATION

RESTATED ARTICLES OF INCORPORATION

RESTATED AS OF MAY 7, 1981

(As Amended and in Effect September 9, 1992)

This Corporation, being organized under the laws of Wisconsin
and being subject to the provisions of Chapter 180 of the Wisconsin
Statutes, hereby amends its restated articles of incorporation in
their entirety and as so amended adopts the following Restated
Articles of Incorporation, which supersede and take the place of its
heretofore existing restated articles of incorporation and all
amendments thereto:

ARTICLE I

NAME

Amended The name of the Corporation is "FIRSTAR CORPORATION".
1/1/89

ARTICLE II

PURPOSE

The purposes for which the Corporation is organized are to
engage in any lawful activity within the purposes for which
corporations may be organized under the Wisconsin Business
Corporation Law (Chapter 180, Wisconsin Statutes); provided,
however, that the Corporation shall not engage in any activities
prohibited by the Bank Holding Company Act of 1956, as amended.

ARTICLE III

CAPITAL STOCK

Amended (1) The number of shares of which the Corporation shall
4/19/84 have authority to issue is 122,500,000, divided into
4/28/86 the following classes:
9/09/92

(a) 120,000,000 shares of the par value of $1.25
each, designated as "Common Stock"; and

(b) 2,500,000 shares of the par value of $1.00 each, designated as "Preferred
Stock".

(2) The Preferred Stock may be issued from time to time in one
or more series, with such designations, preferences,
limitations, and relative rights as shall be stated and
<PAGE> 2

expressed in the resolution or resolutions providing for the
issuance of such series and adopted by the board of directors
pursuant to the authority given as provided by the Wisconsin
Business Corporation Law and not inconsistent with the
provisions hereof. All shares of Preferred Stock shall be
identical except as to the following relative rights and
preferences, in respect of any or all of which there may be
variations between different series as fixed and determined by
the board of directors in the resolution or resolutions
providing for the issuance of such series: (a) rate of
dividend; (b) price at and terms and conditions on which shares
may be redeemed; (c) amount payable upon shares in event of
voluntary or involuntary liquidation; (d) sinking fund
provisions for the redemption or purchase of shares; (e) terms
and conditions on which shares may be converted, if the shares
of any series are issued with the privilege of conversion; and
(f) voting rights, if any.

(3) The holders of Preferred Stock shall be entitled to receive, if and when
declared by the board of directors out of the funds of the Corporation legally
available therefor, dividends at, but not exceeding, the rate established by
the board of directors in the resolution or resolutions providing for the
issuance of any series of Preferred Stock, and such dividends shall be paid or
set apart before any dividends (other than dividends payable in Common Stock of
the Corporation) shall be paid upon or set apart for the Common Stock. The
dividends on the Preferred Stock shall be cumulative, so if at any time the
full amount of dividends accrued and in arrears on the Preferred Stock shall
not be paid, the deficiency (without interest) shall be payable before any
dividends shall be paid upon or set apart on the Common Stock. Dividends on
the Preferred Stock shall accrue and be cumulative from the date of issue and
shall be without priority as between series. Any dividends paid upon the
Preferred Stock in an amount less than full cumulative dividends accrued and in
arrears upon all Preferred Stock shall, if more than one series be outstanding,
be distributed among the different series in proportion to the aggregate
amounts which would be distributed to the Preferred Stock of each series if
full cumulative dividends were declared and paid thereon. Whenever all
dividends accrued and in arrears on the Preferred Stock shall have been
declared and shall have been paid or set apart, the board of directors may
declare dividends on the Common Stock out of the funds of the Corporation
legally available therefor.
(4) In the event of the liquidation or winding up
of the Corporation, whether voluntary or involuntary, the holders of Preferred
Stock, shall be entitled to receive the fixed liquidation amount per share,
plus accrued dividends, all as provided in the resolution or resolutions
adopted by the board of directors providing for the issuance of any series of
Preferred Stock, and no more, before any amount shall be paid to the holders of
Common Stock. As used in this paragraph "accrued dividends" means, in respect
to each share of Preferred Stock, an amount equal to the fixed dividend rate
per annum for each share (without interest thereon), from the date from which
dividends commence to accrue in respect of such share to the date as of which
the computation is to be made, less the aggregate amount (without interest
thereon) of all dividends theretofore paid or declared and set aside for
payment in respect thereof. If, upon any such voluntary or involuntary
liquidation, the assets of the Corporation shall be insufficient to permit
payment to the holders of Preferred Stock of the full preferential amounts
aforesaid, then the entire assets of the Corporation available for distribution
to shareholders shall be distributed ratably among the
<PAGE> 3

holders of Preferred Stock in proportion to the full preferential amounts to
which they are respectively entitled. The holders of Preferred Stock shall not
otherwise be entitled to participate in any distribution of assets of the
Corporation which assets shall be divided and distributed among the holders of
Common Stock according to their respective rights and preferences. No
consolidation or merger of the Corporation with or into another corporation or
corporations and no sale by the Corporation of all or substantially all of its
assets shall be deemed a liquidation or winding up of the Corporation within
the meaning of this paragraph.
(5) The holders of Preferred Stock shall have
only such voting rights as shall be stated in the resolution or resolutions of
the board of directors providing for the issuance of any series of Preferred
Stock.
(6) The Common Stock shall be junior to the Preferred Stock and shall be
subject to all the rights and preferences of the Preferred Stock.
(7) No holder of any shares of the Corporation shall have any preemptive
right to acquire any unissued shares of this Corporation, now or hereafter
authorized, or other securities whether or not convertible into shares of the
Corporation or carrying a right to subscribe to or acquire such shares.
(8) The Corporation is authorized by action of the board of directors without
further consent of shareholders to purchase, take, receive or otherwise
acquire shares of the Corporation, subject only to the provisions of Sections
180.385(1)(a) and (b) of the Wisconsin Statutes.
(9)The Corporation shall be entitled to treat the holder of record of any
share or shares of stock as the owner thereof for all purposes, and shall
not be bound to recognize any equitable or other claim to or interest in any
such share or shares on the part of any other person, whether or not it shall
have express or other notice thereof.

ARTICLE IV

BOARD OF DIRECTORS

Amended(1)Subject to the terms of any series of Preferred Stock as
4/19/90 may be issued from time to time pursuant to the provisions
of Section (2) of Article III, as such terms are stated and expressed in the
resolution or resolutions of the board of directors providing for the issuance
of such Preferred Stock,

(a) The board of directors shall consist of such
number of directors as is fixed from time to time by
a majority of the board of directors in the manner
provided in the By-Laws.
(b)The number of directors may be increased or decreased from time to time by a
majority of the board of directors in the manner provided in the By-Laws, but
no decrease shall have the effect of shortening the term of any incumbent
director.
(2) The board of directors shall be divided into three (3)
classes, as nearly equal in number as possible, as shall
be provided in the By-Laws.
(3) Subject to the terms of any series of Preferred Stock as may be issued from
time to time pursuant to the provisions of Section (2) of Article III, as such
terms are stated and expressed in the resolution or resolutions of the board of
directors providing for the issuance of such Preferred Stock,
<PAGE> 4

(a) Any vacancy occurring in the board of directors resulting from
death, resignation, removal, disqualification or any other cause,
including a vacancy created by an increase in the number of
directors, may be filled only by the affirmative vote of not less
than a majority of the directors then in office, although less than
a quorum.
(b) If there shall be no directors then in office,
the shareholders shall be entitled to fill the
vacancies on the board of directors.
(c) Directors appointed to newly created directorships resulting from any
increase in the authorized number of directors or to fill any vacancies in the
board of directors resulting from death, resignation, removal, disqualification
or any other cause shall hold office for a term expiring at the next annual
meeting of shareholders at which the term of the class to which they have been
appointed expires.
(4) Subject to the terms of any series of Preferred Stock
as may be issued from time to time pursuant to the
provisions of Section (2) of Article III, as such terms
are stated and expressed in the resolution or resolutions
of the board of directors providing for the issuance of
such Preferred Stock, a director may be removed from
office only by the affirmative vote of not less than 75%
of the outstanding shares entitled to vote for the
election of such director, voting together as a single
class, taken at a special meeting of shareholders called
for that purpose.
(5) Notwithstanding the provisions of Article VI, the affirmative vote of not
less than 75% of the outstanding shares entitled to vote generally for the
election of directors, voting together as a single class, shall be required to
amend or repeal this Article IV, or to adopt any provision of the Restated
Articles of Incorporation or By-Laws inconsistent with the purpose or intent of
this Article IV.

ARTICLE V

REGISTERED OFFICE AND AGENT

At the time of adoption of these Restated Articles of
Incorporation the address of the registered office of the
Corporation is 777 East Wisconsin Avenue, Milwaukee, Wisconsin
53202, and the name of the registered agent at that address is
Howard H. Dahms.*

*The registered agent, effective July 1, 1983, is William J.
Schulz.
<PAGE> 5

ARTICLE VI

ELECTION OF MAJORITY AFFIRMATIVE VOTING REQUIREMENTS

Amended The Corporation expressly elects the majority affirmative voting
1/1/89 requirements pursuant to Subsection 180.25(2) of the
Wisconsin Business Corporation Law (or any successor provision to such
subsection) with respect to all subjects referenced in such subsection (or such
successor provision, as the case may be).
<PAGE> 6

ARTICLES OF AMENDMENT
RELATING TO
SERIES D CONVERTIBLE PREFERRED STOCK
OF
FIRSTAR CORPORATION

Pursuant to Sections 180.0602 and 180.1002
of the Wisconsin Business Corporation Law

I, William J. Schulz, Senior Vice President and Deputy General
Counsel of Firstar Corporation, a corporation organized and existing under the
Wisconsin Business Corporation Law (the "Corporation"), in accordance with the
provisions of Sections 180.0602 and 180.1002 thereof, DO HEREBY CERTIFY THAT:

A. Pursuant to the authority conferred upon the Board of Directors by
the Restated Articles of Incorporation, as amended, of the Corporation and in
accordance with Sections 180.0602 and 180.1002 of the Wisconsin Business
Corporation Law, the Board of Directors of the Corporation adopted a resolution
on July 29, 1994, but which was not effective until the date hereof, creating a
series of shares of Preferred Stock, $1.00 par value, of the Corporation,
designated as Series D Convertible Preferred Stock.

B. Said resolution of the Board of Directors of the Corporation
creating the series designated as Series D Convertible Preferred Stock provides
that said series shall have such designation and number of shares and such
preferences, limitations and relative rights as are set forth in the paragraphs
below:

Series D Convertible Preferred Stock

1. Designation and Amount. The shares of such series shall be
designated "Series D Convertible Preferred Stock" and the number of shares
constituting such series shall be limited to 38,775. The liquidation
value shall be $500 per share.

2. Dividends.

(a) The holders of shares of Series D Convertible Preferred Stock
shall be entitled to receive, out of the assets of the Corporation legally
available therefor and as and if declared by the Board of Directors, cash
dividends at the rate of $35 per share per annum, payable quarterly on the
last day of the months of March, June, September and December in each
year, commencing March 31, 1995. Each such dividend shall be paid to the
holders of record of shares of Series D Convertible Preferred Stock on the
<PAGE> 7

applicable record date, not exceeding 30 days preceding the payment date
thereof, as shall be fixed by the Board of Directors. Dividends on
account of arrears for any past dividend periods may be declared and paid
at any time, without reference to any regular dividend payment date, to
holders of record on such date as may be fixed by the Board of Directors,
which shall not exceed 45 days preceding such dividend payment date. Such
dividends shall be cumulative (whether or not in any quarterly dividend
period there
<PAGE> 8

shall be funds of the Corporation legally available for the payment of
such dividends), commencing on the date of original issuance.

(b) No full dividends shall be declared or paid or set apart for
payment on any class or series of stock of the Corporation ranking, as to
dividends, on a parity with the Series D Convertible Preferred Stock for
any period unless full cumulative dividends have been or contemporaneously
are declared and paid or declared and a sum sufficient for the payment
thereof set apart for such payment on the Series D Convertible Preferred
Stock for all dividend payment periods terminating on or prior to the date
of payment of such full cumulative dividends. When dividends are not paid
in full, as aforesaid, upon the shares of the Series D Convertible
Preferred Stock and any class or series of stock of the Corporation
ranking on a parity as to dividends with the Series D Convertible
Preferred Stock, all dividends declared upon shares of the Series D
Convertible Preferred Stock and any class or series of stock of the
Corporation ranking on a parity as to dividends with the Series D
Convertible Preferred Stock shall be declared pro rata so that the amount
of dividends declared per share on the Series D Convertible Preferred
Stock and such other stock shall in all cases bear to each other the same
ratio that accrued dividends per share on the shares of the Series D
Convertible Preferred Stock and such other stock bear to each other.
Holders of shares of the Series D Convertible Preferred Stock shall not be
entitled to any dividend, whether payable in cash, property or stock, in
excess of full cumulative dividends, as herein provided, on the Series D
Convertible Preferred Stock. No interest, or sum of money in lieu of
interest, shall be payable in respect of any dividend payment or payments
on the Series D Convertible Preferred Stock which may be in arrears.

(c) So long as any shares of the Series D Convertible Preferred
Stock are outstanding, no dividend (other than a dividend in Common Stock,
par value $1.25 per share, of the Corporation ("Common Stock") or in any
other class or series of stock of the Corporation ranking junior to the
Series D Convertible Preferred Stock as to dividends and upon liquidation
and other than as provided in paragraph (b) of this Section 2) shall be
declared or paid or set aside for payment or other distribution declared
or made upon the Common Stock or upon any other class or series of stock
of the Corporation ranking junior to or on a parity with the Series D
Convertible Preferred Stock as to dividends or upon liquidation, nor shall
any Common Stock or any class or series of stock of the Corporation
ranking junior to or on a parity with the Series D Convertible Preferred
Stock as to dividends or upon liquidation be redeemed, purchased or
otherwise acquired for any consideration by the Corporation (except by
conversion into or exchange for stock of the Corporation ranking junior to
the Series D Convertible Preferred Stock as to dividends and upon
liquidation) unless, in each case, the full cumulative dividends on all
outstanding shares of the Series D Convertible Preferred Stock shall have
been paid for all past dividend payment periods.

3. Conversion. Each holder of shares of Series D Convertible
Preferred Stock shall have the right, at his option, to convert all or any
part of such shares into shares of Common Stock of the Corporation at any
time on and subject to the following terms and conditions:

(a) The shares of Series D Convertible Preferred Stock shall be
convertible at the office of the transfer agent for such series (the
"Transfer Agent"), and at such other
<PAGE> 9

place or places, if any, as the Board of Directors of the Corporation may
designate, into fully paid and nonassessable (except as otherwise provided
by the Wisconsin Business Corporation Law) shares (calculated as to each
conversion to the nearest 1/100th of a share) of Common Stock. The number
of shares of Common Stock issuable upon conversion of each share of Series
D Convertible Preferred Stock shall be equal to $500 divided by the
conversion price in effect at the time of conversion determined as
hereinafter provided. The price at which shares of Common Stock shall be
delivered upon conversion (herein called the "conversion price") shall be
initially $23.30 per share of Common Stock; provided, however, that such
conversion price shall be subject to adjustment from time to time in
certain instances as hereinafter provided. No payment or adjustment shall
be made in respect of dividends on Common Stock or Series D Convertible
Preferred Stock upon conversion of shares of Series D Convertible
Preferred Stock. Shares of Series D Convertible Preferred Stock
surrendered for conversion after the record date next preceding a dividend
payment date for the Series D Convertible Preferred Stock and before the
dividend payment date must be accompanied by payment of an amount equal to
the dividend thereon which is to be paid on such dividend payment date
(unless the shares of Series D Convertible Preferred Stock surrendered for
conversion have been called for redemption prior to such dividend payment
date). If the Corporation calls for redemption any shares of Series D
Convertible Preferred Stock such right of conversion shall cease and
terminate, as to the shares designated for redemption, at the close of
business on the redemption date, unless the Corporation defaults in the
payment of the redemption price. No fractional shares of Common Stock
will be issued, and a cash payment will be made in lieu of any fractional
share in an amount equal to the same fraction of the last sale price of
the Common Stock (determined as provided in sub-paragraph (c) (iv) of this
Section 3) at the close of business on the business day which next
precedes the day of conversion.

(b) Before any holder of shares of Series D Convertible Preferred
Stock shall be entitled to convert the same into Common Stock, he shall
surrender the certificate or certificates therefor, duly endorsed to the
Corporation or in blank, at the office of the Transfer Agent for such
series or at such other place or places, if any, as the Board of Directors
of the Corporation has designated, and shall give written notice to the
Corporation at said office or place that he elects to convert the same and
shall state in writing therein the name or names (with addresses) in which
he wishes the certificate or certificates for Common Stock to be issued.
The Corporation will, as soon as practicable thereafter, issue and deliver
at said office or place to such holder of shares of Series D Convertible
Preferred Stock or to his nominee or nominees, certificates for the number
of full shares of Common Stock to which he shall be entitled as aforesaid,
together with cash in lieu of any fraction of a share. Shares of Series D
Convertible Preferred Stock shall be deemed to have been converted as of
the close of business on the date of the surrender of such shares for
conversion as provided above, and the person or persons entitled to
receive the Common Stock issuable upon such conversion shall be treated
for all purposes as the record holder or holders of such Common Stock as
of the close of business on such date.

(i) In case the Corporation shall (A) declare and pay a
dividend on its Common Stock in shares of its capital stock, (B) subdivide
its outstanding shares of Common Stock, (C) combine its outstanding shares
of Common Stock into a smaller number of shares, or (D) issue by
reclassification of its Common Stock (including any such reclassification
in connection with a consolidation or merger in which the Corporation is
the continuing corporation) any shares of its capital stock, the
conversion price in effect at the time of the record date for such
dividend or of the effective date of such subdivision, combination or
reclassification shall be proportionately adjusted so that the holder of
any share of Series D Convertible Preferred Stock surrendered for
conversion after such time shall be entitled to receive the kind and
amount of shares which he would have owned or have been entitled to
receive had such share of Series D Convertible Preferred Stock been
converted immediately prior to such time. Such adjustment shall be made
successively whenever any event listed above shall occur.

(ii) In case the Corporation shall issue rights or warrants to
all holders of its Common Stock entitling them to subscribe for or
purchase shares of Common Stock at a price per share less than the Current
Market Price (as defined below in paragraph (iv) of this Section 3(c)), on
the date fixed for the determination of shareholders entitled to receive
such rights or warrants the conversion price shall be reduced by
multiplying the conversion price by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding at the close of
business on the date fixed for such determination plus the number of
shares of Common Stock which the aggregate of the offering price of the
total number of shares of Common Stock so offered for subscription or
purchase would purchase at such Current Market Price and the denominator
shall be the number of shares of Common Stock outstanding at the close of
business on the date fixed for such determination plus the number of
shares of Common Stock so offered for subscription or purchase, such
reduction to become effective immediately after the opening of business on
the day following the date fixed for such determination; provided,
however, in the event that all the shares of Common Stock offered for
subscription or purchase are not delivered upon the exercise of such
rights or warrants, upon the expiration of such rights or warrants the
conversion rate shall be readjusted to the conversion rate which would
have been in effect had the numerator and the denominator of the foregoing
fraction and the resulting adjustment been made based upon the number of
shares of Common Stock actually delivered upon the exercise of such rights
or warrants rather than upon the number of shares of Common Stock offered
for subscription or purchase, such adjustment to become effective
immediately after the opening of business on the day following the
expiration of such rights or warrants. For the purposes of this paragraph
(ii), the number of shares of Common Stock at any time outstanding shall
not include shares held in the treasury of the Corporation but shall
include shares issuable in respect of scrip certificates issued in lieu of
fractions of shares of Common Stock.

(iii) In case the Corporation shall distribute to all
holders of its Common Stock (including any such distribution made in
connection with a consolidation or merger in which the Corporation is the
continuing corporation) evidences of its indebtedness or assets (excluding
dividends or other distributions paid out of earned surplus) or
subscription rights or warrants excluding those referred to in paragraph
(ii) above), the conversion price shall be adjusted so that the same shall
equal the price determined by multiplying the conversion price in effect
immediately prior to the close
<PAGE> 11

of business on the date fixed for the determination of shareholders
entitled to receive such distribution by a fraction of which the numerator
shall be the Current Market Price per share of the Common Stock on the
date fixed for such determination less the then fair market value (as
determined by the Board of Directors, whose determination shall be
conclusive and described in a resolution filed with the Transfer Agent for
such series) of the portion of the assets or evidences of indebtedness so
distributed applicable to one share of Common Stock and the denominator
shall be such Current Market Price per share of the Common Stock, such
adjustment to become effective immediately prior to the opening of
business on the day following the date fixed for the determination of
shareholders entitled to receive such distribution. Such adjustment shall
be made successively whenever any such distribution is made and shall
become effective retroactively after such record date.

(iv) For the purpose of any computation under paragraphs (ii)
and (iii) above, the "Current Market Price" on any date shall be deemed to
be the average of the daily closing prices per share of Common Stock for
30 consecutive business days selected by the Corporation commencing 45
business days before such date. The closing price for each day shall be
the last sale price regular way or, in case no such sale takes place on
such day, the average of the closing bid and asked prices regular way, in
either case on the New York Stock Exchange, or, if the Common Stock is not
listed or admitted to trading on such Exchange, on the principal national
securities exchange or national market system on which the Common Stock is
listed or admitted to trading, or if it is not listed or admitted to
trading on any national securities exchange or national market system, the
average of the closing bid and asked prices as furnished by any member of
the National Association of Securities Dealers, Inc. selected from time to
time by the Corporation for that purpose.

(v) All calculations under this Section 3(c) shall be made to
the nearest cent or to the nearest one-hundredth of a share, as the case
may be.

(vi) In case of any consolidation or merger of the Corporation
with or into any other corporation (other than a consolidation or merger
in which the Corporation is the continuing corporation), or in case of any
sale or transfer of all or substantially all of the assets of the
Corporation, the holder of each share of Series D Convertible Preferred
Stock shall, after such consolidation, merger, sale or transfer, have the
right to convert such share of Series D Convertible Preferred Stock into
the kind and amount of shares of stock and other securities and property
which such holder would have been entitled to receive upon such
consolidation, merger, sale or transfer if he had held the Common Stock
issuable upon the conversion of such share of Series D Convertible
Preferred Stock immediately prior to such consolidation, merger, sale or
transfer. In any such event, effective provision shall be made, in the
articles or certificate of incorporation of the resulting or surviving
corporation or other corporation issuing or delivering such shares, other
securities, cash or other property or otherwise, so that the provisions
set forth herein for the protection of the conversion rights of the Series
D Convertible Preferred Stock shall thereafter be applicable, as nearly as
reasonably may be, to any such other shares of stock and other securities,
cash and other property deliverable upon conversion of the Series D
Convertible Preferred Stock remaining outstanding or other convertible
stock or securities received by the holders in place thereof; and any such
resulting or surviving corporation or other corporation
<PAGE> 12

issuing or delivering such shares, other securities, cash or other
property shall expressly assume the obligation to deliver, upon the
exercise of the conversion privilege, such shares, securities, cash or
other property as the holders of the Series D Convertible Preferred Stock
remaining outstanding, or other convertible stock or securities received
by the holders in place thereof, shall be entitled to receive, pursuant to
the provisions hereof, and to make provision for the protection of the
conversion rights as above provided.

(vii) In the event that at any time, as a result of an
adjustment made pursuant to paragraph (i) above, the holder of any share
of Series D Convertible Preferred Stock thereafter surrendered for
conversion shall become entitled to receive any securities other than
shares of Common Stock, thereafter the amount of such other securities so
receivable upon conversion of any share of Series D Convertible Preferred
Stock shall be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions with respect
to the Common Stock contained in paragraph (i) to (vi), inclusive, above,
and the provisions of this Section 3(c) with respect to the Common Stock
shall apply on like terms to any such other securities.

(viii) No adjustment in the conversion price shall be
required unless such adjustment would require a change of at least 1% in
such price; provided, however, that any adjustments which by reason of
this paragraph (viii) are not required to be made shall be carried forward
and taken into account in any subsequent adjustment.

(d) Whenever the conversion price is adjusted as herein provided:

(i) the Corporation shall promptly file with the Transfer
Agent for such series a certificate of the Treasurer of the Corporation
setting forth the adjusted conversion price and showing in reasonable
detail the facts upon which such adjustment is based, including a
statement of the consideration received or to be received by the
Corporation for any shares of Common Stock issued or deemed to have been
issued; and

(ii) a notice stating that the conversion price has been
adjusted and setting forth the adjusted conversion price shall forthwith
be required, and as soon as practicable after it is required, such notice
shall be mailed by the Corporation to the holders of record of Series D
Convertible Preferred Stock; provided, however, that if within ten days
after the mailing of such notice, an additional notice is required, such
additional notice shall be deemed to be required pursuant to this
paragraph (ii) as of the opening of business on the tenth day after such
mailing and shall set forth the conversion price as adjusted at such
opening of business, and upon the mailing of such additional notice no
other notice need be given of any adjustment in the conversion price
occurring at or prior to such opening of business and after the time that
the next preceding notice given by mailing became required.

(e) In case:

(i) the Corporation shall authorize the distribution to all
holders of its Common Stock of evidences of its indebtedness or assets
(other than dividends or other distributions paid out of earned surplus);
or
<PAGE> 13

(ii) the Corporation shall authorize the granting to the
holders of its Common Stock of rights to subscribe for or purchase any
shares of capital stock of any class or of any other rights; or

(iii) of any reclassification of the Common Stock of the
Corporation (other than a subdivision or combination of its outstanding
shares of Common Stock), or of any consolidation or merger to which the
Corporation is a party and for which approval of any shareholders of the
Corporation is required, or of the sale or transfer of all or
substantially all of the assets of the company; or

(iv) of the voluntary or involuntary dissolution, liquidation
or winding up of the Corporation;

then, in each case, the Corporation shall cause to be filed with the
Transfer Agent for the Series D Convertible Preferred Stock and shall
cause to be mailed, first class postage prepaid, to the holders of record
of the outstanding shares of Series D Convertible Preferred Stock at least
10 days prior to the applicable record date hereinafter specified, a
notice stating (x) the date on which a record is to be taken for the
purpose of such distribution or rights, or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be
entitled to such distribution or rights are to be determined, or (y) the
date on which such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up is expected to become
effective, and the date as of which it is expected that holders of Common
Stock of record shall be entitled to exchange their Common Stock for
securities or other property deliverable upon such reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding
up.

(f) The Corporation shall at all times reserve and keep available,
free from preemptive rights, out of its authorized but unissued Common
Stock, solely for the purpose of effecting the conversion of the shares of
Series D Convertible Preferred Stock, the full number of shares of Common
Stock then issuable upon the conversion of all outstanding shares of
Series D Convertible Preferred Stock. For the purpose of this Section
3(f) the full number of shares of Common Stock issuable upon the
conversion of all outstanding shares of Series D Convertible Preferred
Stock shall be computed as if at the time of computation of such number of
shares of Common Stock all outstanding shares of Series D Convertible
Preferred Stock were held by a single holder. The Corporation shall from
time to time, in accordance with the Wisconsin Business Corporation Law,
increase the authorized amount of its Common Stock if at any time the
authorized amount of its Common Stock remaining unissued shall not be
sufficient to permit the conversion of all shares of Series D Convertible
Preferred Stock at the time outstanding. If any shares of Common Stock
required to be reserved for issuance upon conversion of shares of Series D
Convertible Preferred Stock hereunder require registration with or
approval of any governmental authority under any Federal or State law
before such shares may be issued upon such conversion, the Corporation
will in good faith and as expeditiously as possible endeavor to cause such
shares to be so registered or approved.
<PAGE> 14

(g) The Corporation will pay any and all taxes that may be payable
in respect of the issue or delivery of shares of Common Stock on
conversion of shares of Series D Convertible Preferred Stock pursuant
hereto. The Corporation shall not, however, be required to pay any tax
which may be payable in respect of any transfer involved in the issue or
transfer and delivery of shares of Common Stock in a name other than that
in which the shares of Series D Convertible Preferred Stock so converted
were registered, and no such issue or delivery shall be made unless and
until the person requesting such issue has paid to the Corporation the
amount of any such tax or has established to the satisfaction of the
Corporation that such tax has been paid.

(h) Before taking any action which would cause an adjustment
reducing the conversion price below the then par value of the Common
Stock, the Corporation will take any corporate action which may, in the
opinion of its counsel, be necessary in order that the Corporation may
validly and legally issue fully paid and nonassessable (except as
otherwise provided by the Wisconsin Business Corporation Law) shares of
Common Stock at the conversion price as so adjusted.

4. Liquidation Rights.

(a) Upon the voluntary dissolution, liquidation or winding-up of
the Corporation, the holders of the shares of Series D Convertible
Preferred Stock then outstanding shall be entitled to receive out of the
assets of the Corporation (whether representing capital or surplus),
before any payment or distribution shall be made on the Common Stock or
any other class or series of stock of the Corporation ranking junior to
the Series D Convertible Preferred Stock as to dividends or as to
distribution upon liquidation, dissolution or winding-up, cash in an
amount of $500 per share, plus an amount equal to all dividends cumulated
and unpaid thereon, to the date of final distribution to the holders of
the Series D Convertible Preferred Stock.

(b) Upon the involuntary dissolution, liquidation or winding-up of
the Corporation, the holders of the shares of the Series D Convertible
Preferred Stock then outstanding shall be entitled to receive out of the
assets of the Corporation (whether representing capital or surplus),
before any payment or distribution shall be made on the Common Stock or
any other class or series of stock of the Corporation ranking junior to
the Series D Convertible Preferred Stock as to dividends or as to
distribution upon liquidation, dissolution or winding-up, cash in the
amount equal to $500 per share, plus an amount equal to all dividends
cumulated and unpaid thereon, to the date of final distribution to the
holders of the Series D Convertible Preferred Stock.

(c) After the payment to the holders of the shares of the Series D
Convertible Preferred Stock of the full preferential amounts provided for
in this Section 4, the holders of the Series D Convertible Preferred Stock
as such shall have no right or claim to any of the remaining assets of the
Corporation.

(d) In the event the assets of the Corporation available for
distribution to the holders of shares of the Series D Convertible
Preferred Stock upon any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, shall be insufficient to
pay in full all amounts to which such holders are entitled pursuant to
paragraph (a) or (b) of this Section 4, no distribution shall be made on
account of any shares of any class or series of stock of the Corporation
ranking on a parity with the
<PAGE> 15

shares of the Series D Convertible Preferred Stock upon such dissolution,
liquidation or winding up unless proportionate distributive amounts shall
be paid on account of the shares of the Series D Convertible Preferred
Stock, ratably, in proportion to the full distributable amounts to which
such holders and the holders of all such parity shares are respectively
entitled upon such dissolution, liquidation or winding up.

(e) Upon the dissolution, liquidation or winding up of the
Corporation, the holders of shares of the Series D Convertible Preferred
Stock then outstanding shall be entitled to be paid out of the assets of
the Corporation available for distribution to its stockholders all amounts
to which such holders are entitled pursuant to paragraph (a) or (b) of
this Section 4 before any payment shall be made to the holders of any
class or series of stock of the Corporation ranking junior upon
liquidation to the Series D Convertible Preferred Stock.

(f) Upon the voluntary or involuntary dissolution, liquidation or
winding up of the Corporation, cumulated dividends shall not include
fractional periods between records dates.

5. Optional Redemption. The shares of Series D Convertible
Preferred Stock are not redeemable prior to June 30, 1997. Thereafter the
shares of Series D Convertible Preferred Stock are redeemable in whole at
any time or in part from time to time at the option of the Corporation at
a redemption price of $500 per share, plus an amount equal to any
arrearage in dividends thereon. In the case of a redemption in part of
the shares of Series D Convertible Preferred Stock, the shares to be
redeemed shall be selected pro rata or by lot or in such other manner as
the Board of Directors may determine.

Notice of redemption shall be mailed at least 30 days but not more
than 60 days before the redemption date to each holder of record of shares
of Series D Convertible Preferred Stock to be redeemed at the address
shown on the stock books of the Corporation (but no failure to mail such
notice or any defect therein or in the mailing thereof shall affect the
validity of the proceedings for such redemption except as to the holder to
whom the Corporation has failed to mail such notice or except as to the
holder whose notice was defective). On and after the redemption date,
dividends shall cease to accumulate on shares of Series D Convertible
Preferred Stock called for redemption (unless the Corporation defaults in
the payment of the redemption price).

6. Voting Rights.

(a) Holders of shares of Series D Convertible Preferred Stock shall
not be entitled to vote on any matter, except as otherwise provided by law
or by the Restated Articles of Incorporation, as amended, and except that:

(i) The affirmative vote of the holders of a majority of the
outstanding shares of Series D Convertible Preferred Stock, voting
separately as a single class, shall be required to amend the Restated
Articles of Incorporation of the Corporation to create or authorize, or
increase the authorized amount of, any class or series of stock ranking
prior to the Series D Convertible Preferred Stock in respect of dividends
or distribution of assets on liquidation, dissolution or winding up of the
Corporation or otherwise alter or abolish the liquidation preferences or
any other
<PAGE> 16

preferential right of the Series D Convertible Preferred Stock, alter or
abolish the conversion rights of the Series D Convertible Preferred Stock,
reduce the redemption price or otherwise alter any redemption rights of
the Series D Convertible Preferred Stock, alter or abolish any right of
the Series D Convertible Preferred Stock to receive dividends, or exclude
or limit the voting rights as to these matters.

(ii) If at any time the Corporation falls in arrears in the
payment of dividends on the Series D Convertible Preferred Stock in an
aggregate amount at least equal to the full accrued dividends for six (6)
quarterly dividend periods (a "voting event"), the number of directors of
the Corporation shall be increased by two and the holders of the Series D
Convertible Preferred Stock, voting separately as a single class, shall
have the right to elect two directors to fill the positions so created.
Until such voting event shall have been terminated by payment of all
dividends for all past dividend periods, any director who has been so
elected by the holders of Series D Convertible Preferred Stock may be
removed at any time, either with or without cause, only by the affirmative
vote of the holders of a majority of the votes entitled to be cast for the
election of any such director at a special meeting of such holders called
for that purpose, and any vacancy thereby created may only be filled by
the vote of such holders. If and when such voting event shall have been
terminated, the holders of Series D Convertible Preferred Stock shall be
divested of the foregoing special voting rights, subject to revesting upon
the further occurrence of a voting event. Upon termination of such voting
event, the terms of office of all persons who may have been elected
directors by vote of the holders of Series D Convertible Preferred Stock
pursuant to the foregoing special voting rights shall immediately
terminate. Upon the occurrence of a voting event, the Corporation shall
immediately call special meeting of the holders of Series D Convertible
Preferred Stock entitled to vote upon the occurrence of such voting event
by mailing, by first-class mail, postage prepaid, to each holder of record
of such shares, at such holder's address as the same appears on the books
of the Corporation, a notice of special meeting to be held not less than
20 days nor more than 60 days after the date such notice is given. If the
Corporation does not call such special meeting, such special meeting may
be called by any holder or holders of 10 percent or more of such class, on
like notice. The record date for determining the holders entitled to
notice of and to vote at such meeting shall be the business day
immediately preceding the day on which such notice is mailed. The holders
of the Series D Convertible Preferred Stock, at the time entitled to cast
one-third of the votes entitled to be cast for the election of directors
at such special meeting, present in person or by proxy, shall constitute a
quorum for the election of directors at such special meeting. At any such
meeting or adjournment thereof in the absence of a quorum, subject to the
provisions of any applicable law, the holders of a majority of the shares
of Series D Convertible Preferred Stock, present in person or by proxy at
such meeting, shall have the power to adjourn the meeting for the election
of such directors without notice, other than an announcement at the
meeting, until a quorum is present.
<PAGE> 17

If such voting event shall have been terminated after the notice of a special
meeting provided for in this paragraph has been given but before such special
meeting shall have been held, the Corporation shall, as soon as practicable
after such termination, mail notice of such termination to the holders of the
Series D Convertible Preferred Stock that would have been entitled to vote at
such special meeting.

(b) The foregoing voting provisions shall not apply if, at or prior
to the time when the act with respect to which such voting would otherwise
be required shall be effected, all outstanding Series D Convertible
Preferred Stock shall have been (i) redeemed or called for redemption and
sufficient funds shall have been deposited, in trust, to effect such
redemption in accordance with the provisions hereof, or (ii) purchased or
otherwise acquired by the Corporation and cancelled, or converted into
Common Stock of the Corporation.

7. Rank. The Series D Convertible Preferred Stock shall, as to
dividends and distributions upon liquidation, dissolution (whether
voluntary or involuntary) or winding up of the Corporation:

(a) rank in parity with any class or series of Preferred Stock of
the Corporation, without preference or priority as among holders of such
stock and the Series D Convertible Preferred Stock; and

(b) have preference and priority in ranking to the Common Stock and
any other class or series of common stock of the Corporation.

* * *

C. None of the shares of Series D Convertible Preferred Stock have been
issued.

D. The amendment creating the Series D Convertible Preferred Stock was
adopted by the Board of Directors of the Corporation in accordance with section
180.1002 of the Wisconsin Business Corporation Law and shareholder action was
not required.

These Articles of Amendment shall be effective as of 3:29 P.M. on
the date hereof.

IN WITNESS WHEREOF, the undersigned has executed and subscribed
these Articles of Amendment on behalf of the Corporation and does affirm the
foregoing as true this 31st day of January, 1995.

By:
_____________________________
William J. Schulz
Senior Vice President and Deputy
General Counsel

________________
This instrument was drafted by, and should be returned to, William J.
Schulz, Senior Vice President and Deputy General Counsel, Firstar Corporation,
777 East Wisconsin Avenue, Milwaukee, Wisconsin 53202.

<PAGE> 1
Exhibit 21
SUBSIDIARIES OF THE REGISTRANT

Firstar Corporation has no parents. The following list shows the name of
each subsidiary of Firstar and the state or juristiction of the
incorporation.

<TABLE>
<CAPTION>
State or
Other Jurisdiction
in which Incorporated
Name of Subsidiary or Organized
------------------------------- ----------------------------
<S> <C> <C>
1 Firstar Bank Milwaukee, N.A. United States
1 Firstar Bank Appleton Wisconsin
1 Firstar Bank Eau Claire, N.A. United States
1 Firstar Bank Fond du Lac, N.A. United States
1 Firstar Bank Grantsburg, N.A. United States
1 Firstar Bank Green Bay Wisconsin
1 Firstar Bank Madison, N.A. United States
1 Firstar Bank Manitowoc Wisconsin
1 Firstar Bank Minocqua Wisconsin
1 Firstar Bank Oshkosh, N.A. United States
1 Firstar Bank Rice Lake, N.A. United States
1 Firstar Bank Sheboygan, N.A. United States
1 Firstar Bank Wausau, N.A. United States
1 Firstar Bank Wisconsin Rapids, N.A. United States
1 First Bank Southeast of Lake Geneva, N.A. United States
1 First Bank Souhteast, N.A. United States
4 Firstar Bank Ames Iowa
4 Firstar Bank Burlington, N.A. United States
4 Firstar Bank Cedar Falls Iowa
4 Firstar Bank Cedar Rapids, N.A. United States
4 Firstar Bank Council Bluffs Iowa
4 Firstar Bank Davenport, N.A. United States
4 Firstar Bank Des Moines, N.A. United States
4 Firstar Bank Mount Pleasant Iowa
4 Firstar Bank Ottumwa Iowa
4 Firstar Bank Red Oak, N.A. United States
4 Firstar Bank Sioux City, N.A. United States
2 Firstar Bank of Minnesota, N.A. United States
1 Firstar Bank Illinois Illinois
3 Firstar Metropolitan Bank & Trust Arizona

Firstar Corporation of Wisconsin Wisconsin
Firstar Corporation of Minnesota Minnesota
Firstar Corporation of Arizona Arizona
Firstar Corporation of Iowa Iowa

1 Firstar Trust Company Wisconsin
1 Firstar Trust Company of Florida, N.A. United States
1 Firstar Trust Company of Illinois Illinois
2 Firstar Trust Company of Minnesota Minnesota
Firstar Investment Research & Management Company Wisconsin
Firstar Insurance Services, Inc. Wisconsin
5 Elan Investment Services, Inc. Wisconsin
Elan Life Insurance Company, Inc. Arizona
Elan Title Services, Inc. Wisconsin
</TABLE>

<PAGE> 2

<TABLE>
<CAPTION>
State or
Other Jurisdiction
in which Incorporated
Name of Subsidiary or Organized
------------------------------- ----------------------------
<S> <C> <C>
5 Firstar Community Investment Corporation Wisconsin
Firstar Development Corporation Delaware
5 Firstar Leasing Services Corporation Wisconsin
5 Firstar Mortgage Corporation Wisconsin
5 FM Properties of Wisconsin, Inc. Wisconsin
5 CSFM Corporation Wisconsin
Firstar Home Mortgage Corporation Wisconsin
5 Firstar Information Services Corporation Wisconsin
4 Banks of Iowa Capital Corporation Iowa
4 Banks of Iowa Credit Corporation Iowa
6 CRC Corporation Wisconsin
4 Firstar CSC Corporation Iowa
5 DPC of Milwaukee, Inc. Wisconsin

Appleton Capital Corporation Nevada
Eau Claire Capital Corporation Nevada
Fond du Lac Capital Corporation Nevada
Grantsburg Capital Corporation Nevada
Green Bay Capital Corporation Nevada
Madison Capital Corporation Nevada
Manitowoc Capital Corporation Nevada
Milwaukee Capital Corporation Nevada
Minocqua Capital Corporation Nevada
Oshkosh Capital Corporation Nevada
Rice Lake Capital Corporation Nevada
Sheboygan Capital Corporation Nevada
Wausau Capital Corporation Nevada
Wisconsin Rapids Capital Corporation Nevada
First Southeast Securities Corp. Nevada
First Southeast Investment Corp. Nevada
Burlington Capital Corporation Nevada
Cedar Rapids Capital Corporation Nevada
Davenport Capital Corporation Nevada
Des Moines Capital Corporation Nevada
Red Oak Capital Corporation Nevada
Sioux City Capital Corporation Nevada

Notes

1 Subsidiary of Firstar Corporation of Wisconsin
2 Subsidiary of Firstar Corporation of Minnesota
3 Subsidiary of Firstar Corporation of Arizona
4 Subsidiary of Firstar Corporation of Iowa
5 Subsidiary of Firstar Bank Milwaukee, N.A.
6 Subsidiary of Firstar Bank Madison, N.A.
</TABLE>

All Capital Corporations are subsidiaries of their respective banks

<PAGE> 1

Exhibit 23
The Board of Directors
Firstar Corporation:

We consent to incorporation by reference in the Registration Statements Nos.
33-38830, 33-41030, 33-19830, 33-57521, 33-57657 and 33-57523 on Form S-8 of
Firstar Corporation of our report dated January 19, 1995 relating to the
consolidated balance sheets of Firstar Corporation and subsidiaries as of
December 31, 1994 and 1993, and the related consolidated statements of income,
stockholders' equity and cash flows for each of the years in the three-year
period ended December 31, 1994, which report appears in the December 31, 1994
Annual Report on Form 10-K of Firstar Corporation.

KPMG Peat Marwick LLP

Milwaukee, Wisconsin
March 20, 1995

<PAGE> 1
Exhibit 24
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, FIRSTAR CORPORATION, a Wisconsin corporation (hereinafter
referred to as the "Corporation"), will file with the Securities and Exchange
Commission, under the provisions of the Securities and Exchange Act of 1934, an
Annual Report on Form 10-K for the fiscal year ended December 31, 1994; and

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

NOW, THEREFORE, the undersigned hereby constitutes and appoints ROGER L.
FITZSIMONDS, WILLIAM H. RISCH AND WILLIAM J. SCHULZ, and each of them, his or
her attorney, with full power to act for and in his or her name, place and
stead, to sign his or her name in such capacity to the Annual Report on Form
10-K, hereby ratifying and confirming all that said attorney may or shall
lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
10th day of February, 1995.

/s/ Michael E. Batten SEAL
<PAGE> 2
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
6th day of February, 1995.

/s/ Robert C. Buchanan SEAL
<PAGE> 3
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
6th day of February 1995.

/s/ George M. Chester, Jr. SEAL

<PAGE> 4
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
26th day of January, 1995.

/s/ Roger H. Derusha SEAL
<PAGE> 5
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
30th day of January, 1995.

/s/ James L. Forbes SEAL
<PAGE> 6
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
30th day of January, 1995.

/s/ Holmes Foster SEAL
<PAGE> 7
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
30th day of January, 1995.

/s/ Joseph F. Heil, Jr. SEAL
<PAGE> 8
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
27th day of January, 1995.

/s/ John H. Hendee, Jr. SEAL
<PAGE> 9
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
3rd day of February, 1995.

/s/ Jerry M. Hiegel SEAL
<PAGE> 10
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
4th day of February, 1995.

/s/ Joe Hladky SEAL
<PAGE> 11
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

NOW, THEREFORE, the undersigned hereby constitutes and appoints
ROGER L. FITZSIMONDS, WILLIAM H. RISCH AND WILLIAM J. SCHULTZ, and each of
them, his or her attorney, with full power to act for and in his or her name,
place and stead, to sign his or her name in such capacity to the Annual Report
on Form 10-K, hereby ratifying and confirming all that said attorney may or
shall lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney
this 11th day of March, 1995.

/S/ C. Paul Johnson SEAL
<PAGE> 12
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
2nd day of February, 1995.

/s/ James H. Keyes SEAL
<PAGE> 13
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
26th day of January, 1995.

/s/ Sheldon B. Lubar SEAL
<PAGE> 14
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
31st day of January, 1995.

/s/ Daniel F. McKeithan, Jr. SEAL
<PAGE> 15
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
29th day of January, 1995.

/s/ George W. Mead II SEAL
<PAGE> 16
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
27th day of January, 1995.

/s/ Guy A. Osborn SEAL
<PAGE> 17
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
31st day of January, 1995.

/s/ Judith D. Pyle SEAL
<PAGE> 18
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
27th day of January, 1995.

/s/ Clifford V. Smith, Jr. SEAL
<PAGE> 19
POWER OF ATTORNEY

Firstar Corporation

(Commission File No. 1-2981)

FIRSTAR CORPORATION

Annual Report on Form 10-K

WHEREAS, the undersigned is or may hereafter be a director or executive
officer of the Corporation;

IN WITNESS WHEREOF, the undersigned has signed this Power of Attorney this
13th day of February, 1995.

/s/ William W. Wirtz SEAL

<ARTICLE> 9

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