ALLEGIANT BANCORP INC, 424B1, 1999-07-28

ALLEGIANT BANCORP INC
424B1, 1999-07-28
STATE COMMERCIAL BANKS

Previous: CASH TRUST SERIES INC, NSAR-B, 1999-07-28

Next: COLONIAL INTERMARKET INCOME TRUST I, NSAR-A, 1999-07-28

Filed Pursuant to Rule 424(b)(1)

Registration Nos. 333-82197 and 333-82197-01

PROSPECTUS JULY 27, 1999

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

1,500,000 TRUST PREFERRED SECURITIES

ALLEGIANT CAPITAL TRUST I

9.875% CUMULATIVE TRUST PREFERRED SECURITIES
(LIQUIDATION AMOUNT $10 PER TRUST PREFERRED SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED IN THIS
PROSPECTUS, BY

ALLEGIANT BANCORP, INC.

The trust preferred securities represent undivided beneficial
interests in the assets of Allegiant Capital Trust I. The Trust will
invest the proceeds of this offering of trust preferred securities
in the 9.875% junior subordinated debentures of Allegiant Bancorp, Inc.

For each of the trust preferred securities that you own, you
are entitled to receive cumulative cash distributions at an annual
rate of 9.875% on March 31, June 30, September 30 and December 31 of each
year, beginning September 30, 1999 from payments on the debentures. We
may defer payment of distributions at any time for up to 20 consecutive
quarters. The trust preferred securities are effectively subordinated
to all of our senior and subordinated indebtedness and the senior and
subordinated indebtedness of our subsidiaries. The junior subordinated
debentures mature, and the trust preferred securities must be redeemed, on
August 2, 2029. The Trust may redeem the trust preferred securities, at a
redemption price of $10 per trust preferred security plus accumulated and
unpaid distributions, at any time on or after August 2, 2004, or earlier
under certain circumstances.

The trust preferred securities have been approved for listing,
subject to official notice of issuance, on the American Stock Exchange
under the trading symbol "ACT.Pr."

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

WE URGE YOU TO CAREFULLY READ THE "RISK FACTORS" SECTION
BEGINNING ON PAGE 11, WHERE WE DESCRIBE SPECIFIC RISKS RELATED TO AN
INVESTMENT IN THE TRUST PREFERRED SECURITIES AND RISKS RELATING TO
ALLEGIANT BANCORP, INC., ALONG WITH THE REMAINDER OF THIS
PROSPECTUS, BEFORE YOU MAKE YOUR INVESTMENT DECISION.

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

THESE SECURITIES ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR
OBLIGATIONS OF ANY BANK AND ARE NOT INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE
SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.

<TABLE>
<CAPTION>
Per Trust
Preferred Security Total
------------------ -----------
<S> <C> <C>
Public offering price....................................... $10.000 $15,000,000
Underwriting fees to be paid by Allegiant Bancorp, Inc...... 0.375 562,500
Proceeds to the Trust....................................... 10.000 15,000,000
</TABLE>

We have granted the underwriters an option, exercisable within 30
days after the date of this prospectus, to purchase up to an additional
225,000 trust preferred securities at the initial offering price, solely
to cover over-allotments, if any.

EVEREN SECURITIES, INC. Wheat First Securities

<PAGE>
<PAGE>
ALLEGIANT BANCORP, INC.

BANKING FACILITIES

[Map of the locations of the banking facilities of Allegiant Bank superimposed
over a diagram of the states of Missouri and Illinois indicating the locations
of the banking facilities in the St. Louis metropolitan area.]

<TABLE>
<S> <C> <C> <C>
AFFTON DES PERES ST. PETERS WARRENTON
8930 Gravois 12100 Manchester Road 3551 Harvester Road 236 East Booneslick Road
Affton, MO 63123 Des Peres, MO 63131 St. Peters, MO 63303 Warrenton, MO 63383
314/631-7500 314/822-7000 314/939-9000 314/456-3431
BALLWIN<F1> HAZELWOOD SOUTH COUNTY WEST PORT
15061 Manchester Road 7600 North Lindbergh 7421 South Lindbergh Blvd. 157 Westport Plaza Drive
Ballwin, MO 63011 Hazelwood, MO 63042 Mehlville, MO 63125 Maryland Heights, MO 63146
314/692-8800 314/837-2000 314/892-4000 314/576-8800
CLAYTON ST. LOUIS, DOWNTOWN TOWN & COUNTRY HEADQUARTERS
7801 Forsyth Blvd. 119 North Broadway 157 Lamp and Lantern Village 2122 Kratky Road
Clayton, MO 63105 St. Louis, MO 63102 Town & Country, MO 63017 St. Louis, MO 63114
314/726-5000 314/621-2220 314/227-2223 314/692-8200
CRESTWOOD ST. LOUIS, GRAND UNION
9792 Watson Road 4323 North Grand Blvd. 509 Highway 50 West
Crestwood, MO 63126 St. Louis, MO 63107 Union, MO 63084
314/965-0600 314/534-3000 314/583-4155

<FN>
<F1> Planned opening in August 1999
</TABLE>

<PAGE>
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This prospectus includes forward-looking statements. We have
based these forward-looking statements on our current expectations
and projections about future events. These forward-looking
statements are subject to risks, uncertainties and assumptions,
including, among other things:

* the results of our efforts to implement our business strategy;

* adverse changes in our bank's loan portfolio and the resulting
credit risk-related losses and expenses;

* our ability to manage our growth, including the successful
expansion of the customer support, administrative
infrastructure and internal management systems necessary to
manage such growth;

* our ability to attract core deposits;

* adverse changes in the economy of our market area that could
increase credit-related losses and expenses;

* adverse changes in real estate market conditions that could
negatively affect credit risk;

* the consequences of continued bank acquisitions and mergers in
our market area, resulting in fewer but much larger and
financially stronger competitors, which could increase
competition for financial services to our detriment;

* fluctuations in interest rates and market prices, which could
negatively affect net interest margins, asset valuations and
expense expectations;

* changes in regulatory requirements of federal and state
agencies applicable to bank holding companies and our present
and future bank subsidiaries;

* general economic conditions;

* year 2000 (Y2K) computer, embedded chip and related data
processing issues; and

* other factors discussed in "Risk Factors."

We undertake no obligation to publicly update or otherwise
revise any forward-looking statements, whether as a result of new
information, future events or otherwise. In light of these risks,
uncertainties and assumptions, the events discussed in any
forward-looking statements in this prospectus might not occur.

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

You should rely on the information contained or incorporated by
reference in this prospectus only. We have not, and our underwriters
have not, authorized any person to provide you with different
information. If anyone provides you with different or inconsistent
information, you should not rely on it. We are not, and our
underwriters are not, making an offer to sell the trust preferred
securities in any jurisdiction where the offer or sale is not
permitted.

You should assume that the information appearing in this
prospectus is accurate as of the date on the front cover of this
prospectus only.

Certain persons participating in this offering may engage in
transactions that stabilize, maintain, or otherwise affect the price
of the trust preferred securities being offered, including
over-allotting the trust preferred securities and bidding for and
purchasing trust preferred securities at a price above that which
otherwise might prevail in the open market. For a description of
these activities, see "Underwriting." Such transactions, if commenced,
may be discontinued at any time. In connection with this offering,
certain underwriters may engage in passive market making transactions
in the trust preferred securities on the American Stock Exchange or
otherwise in accordance with Rule 103 of Regulation M. See "Underwriting."

<PAGE>
PROSPECTUS SUMMARY

This summary highlights information contained elsewhere in this
prospectus. Because this is a summary, it may not contain all of the
information that is important to you. To understand the offering
fully, you should read the entire prospectus, including the
financial statements and related notes, before making a decision to
invest in the trust preferred securities. The terms "Allegiant,"
"company," "we," "our" and "corporation" as used in this prospectus
refer to Allegiant Bancorp, Inc. and its subsidiaries as a
consolidated entity, except where it is made clear that it means
only Allegiant. Also, sometimes we refer to our bank subsidiary as
the "bank."

ALLEGIANT BANCORP, INC.

We are a bank holding company headquartered in St. Louis,
Missouri. Our bank subsidiary, Allegiant Bank, offers full-service
community banking and personal trust services to individuals,
businesses and municipalities in the St. Louis metropolitan area.
Our services include commercial, real estate and installment loans,
checking, savings and time deposit accounts, trust and other
personal fiduciary services and various other financial services
such as securities brokerage, insurance and safe deposit boxes. As
of March 31, 1999, we reported, on a consolidated basis, total
assets of $620.86 million, loans of $520.31 million, deposits of
$481.04 million and shareholders' equity of $49.06 million.

Since 1989, when we were organized, we have been committed to
building a strong, customer-friendly community bank. As a community
bank, we are able to respond quickly to our customers through local
decision-making and to tailor products and services to meet their
needs. We believe this customer-friendly approach provides us with a
competitive advantage over many of the larger financial institutions
in the St. Louis metropolitan area. In addition, we believe that we
have benefited from recent acquisitions of locally headquartered
financial institutions by larger regional or national out-of-town
financial institutions. Recent acquisitions of financial
institutions in our market area include: BankAmerica Corporation's
acquisition of Boatmen's Bancshares, Inc.; Union Planters
Corporation's acquisition of Magna Group, Inc.; and the pending
acquisition by Firstar Corp. of Mercantile Bancorporation Inc.

We currently are the fourth largest St. Louis-based bank holding
company. We have expanded rapidly through internal growth and
acquisitions. We believe that market coverage is necessary, and our
goal is to have a banking facility within a 20-minute drive from all
principal sectors of the St. Louis metropolitan area.

Since the beginning of 1998, we have focused primarily on
improving the profitability of our banking operations. As a result,
we have reduced the amount of one- to four-family mortgages that we
hold in our loan portfolio and have increased the amount of higher
yielding commercial loans. We also have hired several banking
professionals with experience in the St. Louis metropolitan area to
help us grow our commercial loans and deposits. We have refined our
market focus to concentrate exclusively on opportunities in the
higher-growth St. Louis metropolitan area and, accordingly, we sold
three retail banking offices outside the St. Louis metropolitan area
in December 1998. We also have implemented company-wide cost-control
efforts to enhance efficiencies of our entire operations.

Our management team is comprised of experienced individuals who
average more than 15 years in the banking or financial services
industries. Our directors and executive officers own approximately
35% of our outstanding common stock.

The St. Louis metropolitan area is the 17th largest metropolitan
area in the United States, with a population of approximately 2.45
million. The St. Louis metropolitan area is home to 19 Fortune 1000
companies, such as Anheuser-Busch Companies, Inc., Monsanto Company,
Ralston Purina Company and Trans World Airlines, Inc. The St. Louis
metropolitan area ranks fifth in the United States as a headquarters
location for Fortune 500 companies. In 1998, the St. Louis
metropolitan area ranked second in Entrepreneur Magazine's listing
of the top places in the United States for small business, marking
four straight years on that publication's top ten list, and Inc.
magazine placed St. Louis among its top ten areas for growing firms.

Our principal executive offices are located at 2122 Kratky Road,
St. Louis, Missouri 63114, and our telephone number is (314)
692-8200.

<PAGE>

RECENT DEVELOPMENTS

We reported consolidated net income for the quarter ended June 30,
1999 of $1.35 million, an increase of $0.27 million, from the $1.08
million reported for the second quarter of 1998. Consolidated net interest
income increased to $6.16 million in the quarter ended June 30, 1999
compared to $5.24 million reported in the second quarter of 1998. Diluted
earnings per share increased 25.00% to $0.20 for the quarter ended June
30, 1999 compared to $0.16 for the prior year quarter.

Consolidated net income for the six months ended June 30, 1999
increased to $2.35 million compared to $1.70 million for the first six
months of 1998. Consolidated net interest income increased to $12.00
million for the six months ended June 30, 1999, an increase of $1.33
million from the corresponding period of 1998. Diluted earnings per
share increased 34.62% to $0.35 for the six months ended June 30, 1999
compared to $0.26 for the corresponding period of 1998.

As of June 30, 1999, we reported, on a consolidated basis, total assets
of $638.17 million, loans of $543.63 million, deposits of $489.82 million
and shareholders' equity of $49.95 million.

ALLEGIANT CAPITAL TRUST I

Allegiant Capital Trust I is a Delaware statutory business trust
that we created for the limited purposes of:

* issuing the trust preferred securities and the trust common
securities;

* investing the proceeds it receives from the issuance of the
trust preferred securities and the trust common securities in
an equivalent amount of junior subordinated debentures issued
by us; and

* engaging in activities related to the activities described
above.

The Trust will issue all of the trust preferred securities to
the purchasers in this offering. We will purchase all of the trust
common securities. The trust common securities will represent an
aggregate liquidation amount equal to at least 3.75% of the total
capital of the Trust.

The junior subordinated debentures and payments received
thereunder will be the only assets of the Trust, and payments under
the junior subordinated debentures will be the only revenue of the
Trust.

The Trust will be governed by the trust agreement among us, as
depositor, Bankers Trust (Delaware), as Delaware trustee, and the
administrators, who are selected by us.

The principal executive offices of the Trust are c/o Allegiant
Bancorp, Inc. at 2122 Kratky Road, St. Louis, Missouri 63114, and
its telephone number is (314) 692-8200.

<TABLE>
THE OFFERING

<S> <C>

THE ISSUER........................................... Allegiant Capital Trust I, a Delaware statutory business
trust.
THE SECURITIES BEING OFFERED......................... 1,500,000 trust preferred securities having a liquidation
amount of $10 per trust preferred security. The trust
preferred securities represent preferred undivided beneficial
interests in the assets of the Trust, which will consist
solely of the junior subordinated debentures and payments
received thereunder. We will guarantee payments on the trust
preferred securities to the extent of funds in the Trust. We
have granted the underwriters an option, exercisable within 30
days after the date of this prospectus, to purchase up to an
additional 225,000 trust preferred securities at the initial
offering price, solely to cover over-allotments, if any.

<PAGE>

THE OFFERING PRICE................................... $10 per trust preferred security.

THE PAYMENT OF DISTRIBUTIONS......................... The Trust will pay cash distributions to you on each trust
preferred security at an annual rate of 9.875%. The distributions
will be cumulative, will accumulate from August 2, 1999,
and will be payable in arrears at the end of each calendar
quarter, commencing September 30, 1999.
WE HAVE THE OPTION TO DEFER INTEREST
PAYMENTS........................................... At any time we are not in default under the junior
subordinated debentures, we may defer payments of interest on
the junior subordinated debentures for up to 20 consecutive
quarters, but not beyond their stated maturity date. The Trust
will defer quarterly distributions on the trust preferred
securities during any time that we defer payments on the
junior subordinated debentures. Deferred quarterly
distributions will continue to accumulate distributions,
and unpaid distributions will accumulate additional
distributions, at an annual rate of 9.875% compounded
quarterly. During any period that we defer interest payments,
we may not declare or pay any cash distributions on our
capital stock or repay any debt securities that rank equal to
or lower than the junior subordinated debentures. After the
end of any period in which we defer interest payments, if we
have paid all deferred and current interest under the junior
subordinated debentures, we may defer interest payments again.
If we defer interest payments, you will be required to include
deferred distributions in your gross income for United States
federal income tax purposes, and you may be required to pay
taxes on the deferred distributions before you receive the
deferred distributions.
MATURITY............................................. The junior subordinated debentures are scheduled to mature on
August 2, 2029 unless we shorten the maturity date to a
date no earlier than August 2, 2004. We will not shorten
the maturity date unless we have first received any required
regulatory approvals. The Trust must redeem the trust
preferred securities when the junior subordinated debentures
are paid on the maturity date.
REDEMPTION OF THE TRUST PREFERRED SECURITIES IS
POSSIBLE........................................... The Trust must redeem the trust preferred securities if we
repay the junior subordinated debentures. Subject to any
regulatory approvals that may then be required, we may redeem
the junior subordinated debentures prior to their scheduled
maturity (1) on or after August 2, 2004, in whole at any
time or in part from time to time, or (2) at any time, in
whole, but not in part, within 90 days after:

* certain tax events occur or become likely to occur;
* the Trust is deemed to be an investment company; or

<PAGE>
* there is an adverse change in the treatment of the trust
preferred securities as Tier 1 capital for bank regulatory
purposes.
Upon any redemption of the junior subordinated debentures, the
trust will use the cash proceeds of the redemption to pay you
the liquidation amount of $10 per trust preferred security plus
any accumulated and unpaid distributions through the date of
redemption.
HOW THE SECURITIES WILL RANK IN RIGHT OF
PAYMENT............................................ The trust preferred securities, junior subordinated debentures
and guarantee will rank as follows with regard to right of
payment:
* The trust preferred securities will rank equally with the
trust common securities. The Trust will pay distributions on
the trust preferred securities and the trust common
securities pro rata. However, if we default with respect
to the junior subordinated debentures, then no distributions
on the trust common securities will be paid until all
accumulated and unpaid distributions on the trust preferred
securities have been paid.
* Our obligations under the junior subordinated debentures are
unsecured and generally will rank junior in priority to our
existing and future senior and other subordinated
indebtedness.
* Our obligations under the guarantee are unsecured and
generally will rank junior in priority to our existing and
future senior and other subordinated indebtedness.
* Because we are a holding company, the junior subordinated
debentures and the guarantee will effectively be
subordinated to all existing and future liabilities of our
subsidiaries.
THE JUNIOR SUBORDINATED DEBENTURES MAY BE DISTRIBUTED
TO YOU............................................. Under certain circumstances and after we obtain any necessary
regulatory approvals, we may dissolve the Trust. If we
dissolve the Trust, after satisfaction of any of the Trust's
liabilities to creditors, the Trust will distribute to you
your pro rata share of the junior subordinated debentures in
liquidation of the Trust.
OUR GUARANTEE OF PAYMENT............................. We will fully and unconditionally guarantee that the Trust
will pay you distributions quarterly, if not deferred, and the
liquidation amount upon liquidation of the Trust, but only, in
each case, to the extent funds are held by the Trust. We will
guarantee the trust preferred securities based on:
* our obligations to make payments on the junior subordinated
debentures;

<PAGE>

* our obligations under a guarantee executed for the benefit
of the holders of the trust preferred securities; and
* our obligations under the indenture and trust agreement.
If we do not make payments on the junior subordinated
debentures, the Trust will not have sufficient funds to make
payments on the trust preferred securities. The guarantee does
not cover payments when the Trust does not have sufficient
funds.
LIMITED VOTING RIGHTS................................ You will have no voting rights except in limited
circumstances.
USE OF PROCEEDS...................................... The Trust will invest all of the proceeds from the sale of the
trust preferred securities and the trust common securities in
our junior subordinated debentures. We will use the net
proceeds from our sale of the junior subordinated debentures
(1) to infuse approximately $8.00 million of capital into the
bank, (2) to repay approximately $2.50 million of corporate
indebtedness, including a revolving line of credit with a balance
of $2.00 million, the proceeds of which were used to repurchase
shares of our common stock and (3) for general corporate purposes,
including possible future repurchases of our common stock.
Funds retained for general corporate purposes will be temporarily
invested in short-term investment securities.
LACK OF RATING....................................... The trust preferred securities will not be rated by a
nationally recognized statistical rating organization and are
not anticipated to be rated in the future.
AMERICAN STOCK EXCHANGE SYMBOL....................... The trust preferred securities have been approved for listing,
subject to official notice of issuance, on the American Stock
Exchange under the symbol "ACT.Pr."
BOOK-ENTRY........................................... The trust preferred securities will be represented by a global
security that will be deposited with and registered in the
name of The Depository Trust Company, New York, New York, or
its nominee. This means that you will not receive a
certificate for your trust preferred securities.
ERISA CONSIDERATIONS................................. You should carefully consider the information set forth under
"Certain ERISA Considerations."
</TABLE>

RISK FACTORS

Before purchasing the trust preferred securities offered by this
prospectus you should carefully consider the "Risk Factors"
beginning on page 11.

<PAGE>
SUMMARY CONSOLIDATED FINANCIAL DATA

The following is our summary consolidated financial information.
The balance sheet and income statement data as of and for the five
years ended December 31, 1998 are taken from our audited
consolidated financial statements as of the end of and for each such
year. The balance sheet and income statement data as of and for the
three months ended March 31, 1999 and 1998 are taken from our
unaudited condensed consolidated financial statements as of the
end of and for each such three-month period. The quarterly data
include all adjustments which are, in our opinion, necessary to present
a fair statement of these periods and are of a normal recurring nature.
Results for the three months ended March 31, 1999 are not
necessarily indicative of results for the entire year. You should
read this summary consolidated financial information in conjunction
with our consolidated financial statements and notes that appear in
this prospectus.

<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31, YEARS ENDED DECEMBER 31,
------------------- ----------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
-------- -------- -------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Interest income............................ $ 11,925 $ 12,270 $ 49,218 $ 37,765 $ 25,056 $ 19,252 $ 9,994
Interest expense........................... 6,088 6,841 27,267 21,466 14,999 11,206 4,584
-------- -------- -------- -------- -------- -------- --------
Net interest income...................... 5,837 5,429 21,951 16,299 10,057 8,046 5,410
Provisions for loan losses................. 562 400 2,420 2,397 1,448 977 849
-------- -------- -------- -------- -------- -------- --------
Net interest income after provision...... 5,275 5,029 19,531 13,902 8,609 7,069 4,561
-------- -------- -------- -------- -------- -------- --------
Other income............................... 1,254 1,109 9,324 3,298 1,393 654 513
Other expense.............................. 4,858 5,118 21,295 13,069 7,019 5,625 3,764
-------- -------- -------- -------- -------- -------- --------
Income before income taxes............... 1,671 1,020 7,560 4,131 2,938 2,098 1,310
Provision for income taxes................. 669 393 3,026 1,716 1,175 823 509
-------- -------- -------- -------- -------- -------- --------
Net income............................... $ 1,002 $ 627 $ 4,534 $ 2,415 $ 1,808 $ 1,275 $ 801
======== ======== ======== ======== ======== ======== ========
COMMON SHARE DATA:
Book value per share at period-end......... $ 7.48 $ 6.87 $ 7.36 $ 6.88 $ 4.80 $ 4.25 $ 3.60
Basic earnings per share................... 0.15 0.10 0.72 0.54 0.55 0.42 0.35
Diluted earnings per share................. 0.15 0.09 0.68 0.49 0.48 0.42 0.35
Cash dividends declared per share.......... 0.05 0.03 0.12 0.08 0.06 0.04 0.02
Dividend payout ratio...................... 32.73% 24.56% 20.22% 13.77% 10.34% 8.86% 7.24%
BALANCE SHEET DATA (AT PERIOD-END):
Total assets............................... $620,857 $617,600 $596,274 $608,237 $377,564 $280,386 $171,927
Total loans................................ 520,306 507,156 495,668 484,863 291,926 181,544 121,393
Indebtedness:
Short-term borrowings.................... 10,039 11,038 14,542 15,729 11,637 4,108 14,756
Federal Home Loan Bank advances.......... 64,125 64,625 66,125 47,475 31,500 21,100 7,750
Other borrowings......................... 13,150 13,650 13,150 13,650 7,663 8,619 4,704
Total deposits............................. 481,038 479,776 450,766 484,641 308,670 231,309 134,884
Shareholders' equity....................... 49,059 43,017 48,104 42,071 16,386 13,938 8,453
SELECTED FINANCIAL RATIOS AND OTHER DATA:
Performance Ratios:
Net interest margin...................... 4.17% 3.81% 3.82% 3.71% 3.39% 3.71% 4.27%
Net interest spread...................... 3.66 3.33 3.33 3.20 2.92 3.22 3.84
Other income to average assets........... 0.83 0.72 1.51 0.71 0.45 0.29 0.38
Other expense to average assets.......... 3.22 3.34 3.44 2.82 2.27 2.47 2.82
Return on average total assets........... 0.67 0.41 0.73 0.52 0.59 0.56 0.60
Return on average shareholders' equity... 8.41 5.98 10.14 9.55 12.17 10.86 9.91
Total loans to total deposits at
period-end.............................. 108.16 105.71 109.96 100.05 94.58 78.49 90.00
Average interest earning assets to
average interest bearing liabilities.... 111.90 110.01 110.34 110.33 109.27 109.55 111.90
Efficiency ratio......................... 68.51 78.28 68.07 66.69 61.30 64.66 63.55
Average assets per employee.............. $ 2,680 $ 2,438 $ 2,879 $ 2,835 $ 2,835 $ 2,480 $ 2,301
Asset Quality Ratios (at period-end):
Allowance for loan losses to total
loans................................... 1.30% 1.07% 1.30% 1.07% 1.06% 1.17% 1.20%
Non-performing loans to total loans...... 0.37 0.20 0.36 0.28 0.24 0.17 0.14
Allowance for loan losses to total
non-performing loans.................... 354.24 547.43 362.32 377.12 447.98 691.56 841.04
Net charge offs to average loans......... 0.05 0.03 0.25 0.19 0.21 0.19 0.19
Non-performing assets to total assets.... 0.31 0.23 0.30 0.28 0.18 0.11 0.12
</TABLE>

<PAGE>

All share and per share amounts included above have been
restated to reflect: (1) a six-for-five stock split effected in
January 1994; (2) a five-for-three stock split effected in January
1995; (3) a 10% stock dividend paid in January 1996; (4) a 10% stock
dividend paid in January 1997; (5) a five-for-four stock split
effected in January 1998; and (6) a six-for-five stock split
effected in January 1999.

For purposes of the above table: (1) short-term borrowings
consist of federal funds purchased, repurchase agreements and
amounts due in 12 months or less on our term debt; and (2) other
borrowings consist of amounts due in more than 12 months on our term
debt and our outstanding subordinated debentures and convertible
subordinated debentures.

Our efficiency ratio is the quotient of our other expense over
the sum of our net interest income and other income.

For purposes of calculating the ratio of earnings to fixed
charges, earnings consist of earnings before income taxes plus
interest and one-half of rental expense. Fixed charges, excluding
interest on deposits, consist of interest on indebtedness and
one-half of rental expense (which is deemed representative of the
interest factor). Fixed charges, including interest on deposits,
consists of the foregoing items plus interest on deposits.

<PAGE>
RISK FACTORS

You should carefully consider the following risk factors before
purchasing the trust preferred securities offered by this
prospectus. There could be other factors not listed below that may
affect the Trust and us.

RISK FACTORS RELATING TO THE TRUST PREFERRED SECURITIES

THE TRUST WILL RELY SOLELY UPON PAYMENTS BY US AND, INDIRECTLY, ON
PAYMENTS BY THE BANK FOR FUNDS TO MAKE DISTRIBUTIONS ON THE TRUST
PREFERRED SECURITIES.

The Trust will depend solely on our payments on the junior
subordinated debentures to pay amounts due to you on the trust
preferred securities. We are a separate legal entity from our
subsidiaries and do not have significant operations of our own. We
will depend primarily on any dividends we receive from the bank,
which may be limited by regulations, and our cash and liquid
investments, to pay interest to the Trust on the junior subordinated
debentures. We anticipate that an additional source of funds for
payments of interest on the junior subordinated debentures
will be borrowings, including future borrowings from time to time
under our revolving line of credit. You should be aware that our
existing revolving line of credit is short-term in nature, and we
may not be able to renew the line of credit in order to pay interest
on the junior subordinated debentures.

OUR OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR SUBORDINATED
DEBENTURES ARE SUBORDINATED TO MOST OF OUR OTHER CREDITORS AND ALL OF
THE CREDITORS OF THE BANK.

Our obligations under the guarantee and the junior subordinated
debentures are unsecured and generally are subordinated in right of
payment to all of our existing and future senior debt, subordinated
debt and additional senior obligations, which totaled $87.31 million
at March 31, 1999.

Because we are a holding company, the creditors of our
subsidiaries also will have priority over you in any distribution of
our subsidiaries' assets in a liquidation, reorganization or
otherwise. Therefore, the junior subordinated debentures will be
effectively subordinated to all existing and future liabilities of
our subsidiaries, and you should look only to our assets for
payments on the junior subordinated debentures. The junior
subordinated debentures do not limit our ability or the ability of
our subsidiaries to incur additional debt. See "Description of
Junior Subordinated Debentures--Subordination."

WE MAY DEFER INTEREST PAYMENTS UNDER THE JUNIOR SUBORDINATED
DEBENTURES.

So long as we are not in default under the junior subordinated
debentures, we may defer the payment of interest on the junior
subordinated debentures at any time or from time to time for up to
20 consecutive quarters. Any deferral, however, cannot extend beyond
the stated maturity date of the junior subordinated debentures.

During any period in which we defer interest payments, the Trust
will defer quarterly distributions on the trust preferred
securities, which will continue to accumulate distributions at an
annual rate of 9.875%, and unpaid distributions will accumulate additional
distributions at the annual rate of 9.875% compounded quarterly from the
relevant distribution payment date. During a deferral period you will
continue to accumulate income, in the form of original issue discount,
for federal income tax purposes on the trust preferred securities, but
you will not receive distributions attributable to that income. In
addition, during a deferral period, your tax basis in the trust preferred
securities will increase by the amount of accumulated but unpaid
distributions. If you sell the trust preferred securities during a
deferral period, your increased tax basis will decrease the amount
of any capital gain or increase the amount of any capital loss that
you may have otherwise recognized on the sale. A capital loss,
except in certain limited circumstances, cannot be applied to offset
ordinary income. As a result, deferral of distributions could result
in ordinary income, a related tax liability for the holder, and a
capital loss that may only be used to offset a capital gain. See
"Description of Junior Subordinated Debentures--Option to Extend
Interest Payment Period" and "Certain United States Federal Income
Tax Consequences."

<PAGE>
Should we elect to exercise our right to defer interest payments
on the junior subordinated debentures, the market price for the
trust preferred securities would likely be adversely affected. If
you dispose of trust preferred securities during a deferral period,
you might not recover the same return on your investment as someone
who continues to hold trust preferred securities. Due to our right
to defer interest payments, the market price of the trust preferred
securities may be more volatile than the market prices of other
securities without the deferral feature.

THE GUARANTEE COVERS PAYMENTS ONLY IF THE TRUST HAS FUNDS AVAILABLE.

If we do not make payments on the junior subordinated
debentures, the Trust will not have sufficient funds to pay
distributions or the $10 per trust preferred security liquidation
amount. Because the guarantee does not cover payments when the Trust
does not have sufficient funds, you will not be able to rely on the
guarantee for payment of these amounts. Instead, you or the property
trustee may enforce the rights of the Trust under the junior
subordinated debentures directly against us. See "Description of
Guarantee."

IN CERTAIN CIRCUMSTANCES THE TRUST MAY REDEEM THE TRUST PREFERRED
SECURITIES, WHICH WOULD REQUIRE YOU TO REINVEST YOUR PRINCIPAL
SOONER THAN EXPECTED.

Under the following circumstances and, subject to regulatory
approvals, we may redeem the junior subordinated debentures before
the stated maturity of the junior subordinated debentures:

* We may redeem the junior subordinated debentures in whole, but
not in part, prior to maturity within 90 days after certain
occurrences at any time during the life of the Trust. These
occurrences include certain adverse tax, Investment Company
Act or bank regulatory developments. If we redeem the junior
subordinated debentures due to the occurrence of one of these
events, the Trust will redeem the trust preferred securities.

* We may also at any time shorten the maturity of the junior
subordinated debentures to a date not earlier than
August 2, 2004.

If we redeem the junior subordinated debentures, the Trust will
redeem a pro rata amount of the trust preferred securities, and you
may be required to reinvest your principal at a time when you may
not be able to earn a return that is as high as you were earning on
the trust preferred securities. See "Description of Trust Preferred
Securities--Redemption."

YOU WILL HAVE ONLY LIMITED VOTING RIGHTS, AND WE CAN AMEND THE TRUST
AGREEMENT UNDER CERTAIN CIRCUMSTANCES WITHOUT YOUR CONSENT.

You will have limited voting rights as a holder of trust
preferred securities. Your voting rights will relate only to the
modification of the trust preferred securities and the exercise of
the Trust's rights as holder of the junior subordinated debentures.
You will not usually be able to appoint, remove or replace the
property trustee or the Delaware trustee because these rights
generally reside with us as the holder of the trust common securities.
However, if an event of default with respect to the junior subordinated
debentures occurs and is continuing, the holders of a majority in
aggregate liquidation amount of the trust preferred securities may
remove the trustees. Even if it would adversely affect your rights, we,
together with the property trustee and the trust administrators,
may amend the trust agreement without your consent to ensure that
the Trust will be classified as a grantor trust for United States
federal income tax purposes or to ensure that the Trust will not be
required to register as an investment company.

WE CAN DISTRIBUTE THE JUNIOR SUBORDINATED DEBENTURES TO YOU, WHICH
MAY HAVE ADVERSE TAX CONSEQUENCES FOR YOU AND WHICH MAY AFFECT THE
MARKET PRICE OF THE TRUST PREFERRED SECURITIES.

The Trust may be dissolved at any time before maturity of the
junior subordinated debentures on August 2, 2029. As a result, and
subject to the terms of the trust agreement, the trustees may distribute
the junior subordinated debentures to the holders of the trust preferred
securities. See "Description of Trust Preferred Securities--Liquidation
Distribution Upon Dissolution."

<PAGE>
We cannot predict the market price for the junior subordinated
debentures that may be distributed. Accordingly, the junior
subordinated debentures that you receive upon a distribution, or the
trust preferred securities you hold pending such a distribution, may
trade at a price that is less than you paid to purchase the trust
preferred securities. Because you may receive junior subordinated
debentures, you must also make an investment decision with regard to
the junior subordinated debentures. You should carefully review all
of the information regarding the junior subordinated debentures
contained in this prospectus.

Under current United States federal income tax laws, a
distribution of the junior subordinated debentures to you upon the
dissolution of the Trust would not be a taxable event to you.
Nevertheless, if the Trust is classified for United States federal
income tax purposes as an association taxable as a corporation at
the time it is dissolved, the distribution of the junior
subordinated debentures would be a taxable event to you. In
addition, if there is a change in law, a distribution of junior
subordinated debentures upon the dissolution of the Trust could be a
taxable event to you. See "Certain United States Federal Income Tax
Consequences."

If the junior subordinated debentures are distributed by the
Trust, we will use our best efforts to list the junior subordinated
debentures for trading on the American Stock Exchange. However, we may
not be able to achieve that listing and a market for the junior
subordinated debentures may not develop.

THE HOLDERS OF THE TRUST PREFERRED SECURITIES AND THE JUNIOR
SUBORDINATED DEBENTURES ARE NOT PROTECTED BY COVENANTS IN THE
TRUST AGREEMENT OR THE INDENTURE.

Neither the indenture, which sets forth the terms of the junior
subordinated debentures, nor the trust agreement, which sets forth
the terms of the trust preferred securities and the trust common
securities, protects holders of junior subordinated debentures or
the trust preferred securities, respectively, in the event we
experience significant adverse changes in our financial condition or
results of operations. In addition, neither the indenture nor the
trust agreement limits our ability or the ability of any subsidiary
to incur additional indebtedness. Therefore, the provisions of these
governing instruments should not be considered a significant factor
in evaluating whether we will be able to comply with our obligations
under the junior subordinated debentures or the guarantee.

YOU MUST RELY ON THE PROPERTY TRUSTEE TO ENFORCE YOUR RIGHTS IF
THERE IS AN EVENT OF DEFAULT UNDER THE INDENTURE.

You may not be able to directly enforce your rights against us
if an event of default under the indenture occurs. If an event of
default with respect to the junior subordinated debentures occurs
and is continuing, the event also will be an event of default under
the trust agreement. In that case, you would rely on the enforcement
by the property trustee of its rights against us as holder of the
junior subordinated debentures. The holders of a majority in
liquidation amount of the trust preferred securities will have the
right to direct the property trustee to enforce its rights. If the
property trustee does not enforce its rights following an event of
default and a request by the record holders to do so, any record holder
may take action directly against us to enforce the property trustee's
rights. If an event of default occurs under the trust agreement that
is attributable to an event of default with respect to the junior
subordinated debentures, or if we default under the guarantee, you may
proceed directly against us. You will not be able to exercise directly
any other remedies available to the holders of the junior subordinated
debentures unless the property trustee fails to do so.

THE MARKET PRICE FOR THE TRUST PREFERRED SECURITIES MAY DECLINE
AFTER YOU INVEST.

The market price for the trust preferred securities may decline
during any period that we are deferring interest payments on the
junior subordinated debentures. If this were the case, the trust
preferred securities would not trade at a price that accurately
reflects the value of accumulated but unpaid interest on the
underlying junior subordinated debentures.

There is no current public market for the trust preferred
securities. Although the trust preferred securities have been approved
for listing, subject to official notice of issuance, on the American
Stock Exchange, there is no guarantee that an active or liquid public
trading market will develop for the trust

<PAGE>
preferred securities or that listing of the trust preferred securities
will continue on the American Stock Exchange. If an active trading
market does not develop, the market price and liquidity of the trust
preferred securities will be adversely affected. Even if an active
public market does develop, there is no guarantee that the market
price for the trust preferred securities will equal or exceed the
price you pay for the trust preferred securities.

Future trading prices of the trust preferred securities may be
subject to significant fluctuations in response to prevailing
interest rates, our future operating results and financial
condition, the market for similar securities and general economic
and market conditions. The initial public offering price of the
trust preferred securities has been set at the liquidation amount of
the trust preferred securities and may be greater than the market
price following the offering.

THE TRUST PREFERRED SECURITIES ARE NOT FDIC INSURED.

Neither the Federal Deposit Insurance Corporation nor any other
governmental agency has insured the trust preferred securities.

WE HAVE NOT SOUGHT AN INVESTMENT RATING FOR THE TRUST PREFERRED
SECURITIES.

The trust preferred securities are not rated by any rating
agency and are not anticipated to be rated in the future. We
believe, however, that if the trust preferred securities were to be
rated at this time, the rating determined would be that of
speculative grade.

RISK FACTORS RELATING TO ALLEGIANT AND ITS INDUSTRY

WE MAY EXPERIENCE DIFFICULTIES IN MANAGING OUR GROWTH.

As part of our general strategy, we may acquire banks and
related businesses that we believe provide a strategic fit with our
business. To the extent that we do grow, we cannot assure you that
we will be able to adequately and profitably manage such growth. In
addition, we may not be able to obtain regulatory approval for
acquisitions we want to make. Acquiring other banks and businesses
will involve risks commonly associated with acquisitions, including:

* potential exposure to liabilities of banks and businesses we
acquire;

* difficulty and expense of integrating the operations and
personnel of banks and businesses we acquire;

* potential disruption to our business;

* potential diversion of our management's time and attention;

* impairment of relationships with and the possible loss of key
employees and customers of the banks and businesses we
acquire; and

* incurrence of amortization expense if we account for an
acquisition as a purchase and dilution to our shareholders if
we use our common stock as consideration for the acquisition.

We recognized operating losses in the fourth quarter of 1997
totaling approximately $0.75 million in connection with two branch
acquisitions and upgrading our computer system to an entirely new
operating system. We believe these losses were systemic and
non-recurring. Throughout 1998, we invested significant resources in
reengineering several operational processes and in additional
training in an effort to address the problems that resulted in the
losses.

IT MAY BE DIFFICULT FOR US TO MAINTAIN OUR HISTORICAL GROWTH RATE.

We have completed various acquisitions and opened additional
branches in the past few years that have significantly enhanced our
rate of growth. We cannot provide you assurances that we will
continue to sustain this rate of growth or grow at all. Competition
for suitable acquisition candidates is intense. We may target

<PAGE>
acquisition candidates that a variety of larger financial
institutions with substantially greater resources than us also may
be interested in acquiring, which may make it more difficult for us
to acquire any candidate.

THE LOSS OF CERTAIN KEY PERSONNEL COULD ADVERSELY AFFECT OUR
OPERATIONS.

Our success depends in large part on the retention of key
personnel, including Shaun R. Hayes, our President and Chief
Executive Officer, Marvin S. Wool, our Chairman, and certain other
executive officers.

We will likely undergo a difficult transition period if we lose
the services of any of these individuals. In recognition of this
risk, we own and are the beneficiary of an insurance policy on the
life of Mr. Hayes providing death benefits of $2.00 million.

Our success also depends on the experience of the managers of
our banking facilities and on their relationships with the communities
they serve. The loss of these key persons could negatively impact the
affected banking operations. We may not be able to retain our current
key personnel or attract additional qualified key persons as needed.

CHANGES IN THE LOCAL ECONOMIC CONDITIONS COULD ADVERSELY AFFECT OUR
LOAN PORTFOLIO.

Our success depends to a great extent upon the general economic
conditions of the St. Louis metropolitan area. Unlike larger banks
that are more geographically diversified, we primarily provide
banking and financial services to customers in the St. Louis
metropolitan area. Our commercial, real estate and construction
loans, the ability of the borrowers to repay these loans and the
value of the collateral securing these loans are impacted by our
local economic conditions. We cannot assure you that favorable
economic conditions will exist in our market.

OUR ALLOWANCE FOR LOAN LOSSES MAY NOT BE ADEQUATE TO COVER ACTUAL
LOAN LOSSES.

As a lender, we are exposed to the risk that our customers will
be unable to repay their loans according to their terms and that any
collateral securing the payment of their loans may not be sufficient
to assure repayment. Credit losses are inherent in the lending
business and could have a material adverse effect on our operating
results. Our credit risk with respect to our real estate and
construction loan portfolio relates principally to the general
creditworthiness of individuals and the value of real estate serving
as security for the repayment of loans. Our credit risk with respect
to our commercial and consumer installment loan portfolio relates
principally to the general creditworthiness of businesses and
individuals within our local market.

We make various assumptions and judgments about the
collectibility of our loan portfolio and provide an allowance for
potential losses based on a number of factors. If our assumptions
are wrong, our allowance for loan losses may not be sufficient to
cover our loan losses. We may have to increase the allowance in the
future. Additions to our allowance for loan losses would decrease
our net income.

WE MAY BE UNABLE TO MANAGE INTEREST RATE RISKS THAT COULD REDUCE OUR
NET INTEREST INCOME.

Like other financial institutions, our results of operations are
affected principally by net interest income, which is the difference
between interest earned on loans and investments and interest
expense paid on deposits and other borrowings. We cannot predict or
control changes in interest rates. Regional and local economic
conditions and the policies of regulatory authorities, including
monetary policies of the Board of Governors of the Federal Reserve
System, affect interest income and interest expense. While we
continually take measures intended to manage the risks from changes
in market interest rates, changes in interest rates can still have a
material adverse effect on our profitability.

In addition, certain assets and liabilities may react in
different degrees to changes in market interest rates. For example,
interest rates on some types of assets and liabilities may fluctuate
prior to changes in broader market interest rates, while rates on other
types may lag behind. Further, some of our assets, such as adjustable
rate mortgages, have features, including rate caps, which restrict changes
in their interest rates.
15

<PAGE>

Factors such as inflation, recession, unemployment, money
supply, international disorders, instability in domestic and foreign
financial markets, and other factors beyond our control may affect
interest rates. Changes in market interest rates also will affect
the level of voluntary prepayments on our loans and the receipt of payments
on our mortgage-backed securities resulting in the receipt of proceeds that
may be reinvested at a lower rate than the loan or mortgage-backed security
being prepaid. Although we pursue an asset-liability management
strategy designed to control our risk from changes in market interest
rates, changes in interest rates can still have a material adverse
effect on our profitability.

INSIDERS MAY CONTROL OUR FUTURE OPERATIONS AS A RESULT OF THE
CONCENTRATION OF CONTROL OF OUR COMMON STOCK.

Our executive officers and directors beneficially own
approximately 35% of our outstanding common stock. As a result,
these insiders may be able to control the election of our Board of
Directors and thus our direction and future operations, and our
other shareholders may lack an effective vote with respect to such
matters. See "Beneficial Ownership."

WE CANNOT PREDICT HOW CHANGES IN TECHNOLOGY WILL IMPACT OUR
BUSINESS.

The financial services industry, including the banking sector,
is increasingly affected by advances in technology, including
developments in:

* telecommunications;

* data processing;

* automation;

* Internet banking;

* telebanking; and

* debit cards and so-called "smart cards."

Our ability to compete successfully in the future will depend on
whether we can anticipate and respond to technological changes. To
develop these and other new technologies we will likely have to make
additional capital investments. Although we continually invest in
new technology, we cannot assure you that we will have sufficient
resources or access to the necessary technology to remain
competitive in the future.

THE BANKING BUSINESS IS HIGHLY COMPETITIVE.

We operate in a competitive environment. In the St. Louis
metropolitan area, other commercial banks, savings and loan
associations, credit unions, finance companies, mutual funds,
insurance companies, brokerage and investment banking firms and
other financial intermediaries offer similar services. Many of these
competitors have substantially greater resources and lending limits
and may offer certain services we do not currently provide. In
addition, some of our nonbank competitors are not subject to the
same extensive regulations that govern us, the bank and our
subsidiaries. Our profitability depends upon the ability of the bank
to compete in our market area. See "Business--Competition."

OUR OPERATIONS MAY BE ADVERSELY AFFECTED IF WE, OR CERTAIN PERSONS
WITH WHOM WE DO BUSINESS, FAIL TO ADEQUATELY ADDRESS THE YEAR 2000
ISSUE.

A critical issue has emerged in the banking industry and for the
economy overall regarding how existing application software programs
and operating systems can accommodate the date value for the year
2000. The "year 2000 issue" arose because many of these existing
programs and systems use only the last two digits in referring to a
year. Therefore, these computer programs do not properly recognize a
year beginning with "20" instead of the familiar "19." If not
corrected, many computer applications and other technology-based
systems could fail or create erroneous results. The effects of this
problem will vary from system to system, and the extent of the
potential impact of the year 2000 issue is not yet known. The year
2000 issue may adversely affect a bank's operations. We could experience
interruptions in our business and suffer significant losses if we,
or a supplier or vendor with whom we contract, are unable to achieve
year 2000
16

<PAGE>
readiness before January 1, 2000. We are in the process of working with
our third party service providers and software vendors to assure that we
and our subsidiaries are prepared for the year 2000. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations--
Year 2000."

WE ARE SUBJECT TO EXTENSIVE REGULATION.

The banking industry is heavily regulated under both federal and
state law. These regulations are primarily intended to protect
depositors and the Federal Deposit Insurance Corporation, not our
creditors or shareholders. We and our nonbank subsidiaries also are
subject to the supervision of the Federal Reserve Board, in addition
to other regulatory and self-regulatory organizations. Regulations
affecting banks and financial services companies undergo continuous
change, and the ultimate effect of such changes cannot be predicted.
Regulations and laws may be modified at any time, and new legislation
may be enacted that affects us, the bank or our subsidiaries. We cannot
assure you that such modifications or new laws will not adversely affect
us, the bank or our subsidiaries. See "Business--Supervision and
Regulation."

We will depend primarily upon dividends from the bank to meet
our obligations under the junior subordinated debentures. Banking
regulations may restrict or even prevent us from receiving dividends
from the bank in the future.

USE OF PROCEEDS

The Trust will invest all the proceeds from the sale of the
trust preferred securities in the junior subordinated debentures. We
will use the net proceeds we receive from the sale of the junior
subordinated debentures, which we estimate to be approximately
$14,087,500 ($16,253,125 if the underwriters' over-allotment option
is exercised in full):

* to infuse approximately $8.00 million of capital into the
bank;

* to repay approximately $2.50 million of corporate indebtedness
consisting of $2.00 million under a revolving line of credit
and a $0.50 million principal repayment on term debt. The
revolving line of credit bears interest at the prime
rate (currently 8.00% per annum) and matures in November 1999.
The term loan bears interest at the rate of 7.00% per annum
and matures in November 2001. During July 1999, borrowing under the
line of credit, together with cash on hand of $0.33 million, were
used to repurchase 233,219 shares of our common stock for $2.33
million; and

* for general corporate purposes, including possible future
repurchases of our common stock.

Funds retained for general corporate purposes will be temporarily
invested in short-term investment securities.

<PAGE>
CAPITALIZATION

The following tables set forth (1) our consolidated
capitalization at March 31, 1999, (2) our consolidated
capitalization giving effect to the issuance of the trust preferred
securities, (3) our actual consolidated regulatory capital ratios as
of March 31, 1999, and (4) our capital ratios after giving effect to
the issuance of the trust preferred securities. The tables assume
application of the net proceeds from the corresponding sale of the
junior subordinated debentures to the Trust as if the sale of the
trust preferred securities had been completed on March 31, 1999, and
as if the underwriters' over-allotment was not exercised. The tables
do not include the effects of the common stock repurchase described
below.

<TABLE>
<CAPTION>
MARCH 31, 1999
----------------------------
ACTUAL AS ADJUSTED
--------- ------------
(DOLLARS IN THOUSANDS, EXCEPT SHARE
AND PER SHARE AMOUNTS)
<S> <C> <C>
DEPOSITS:
Noninterest-bearing deposits................................ $ 51,627 $ 51,627
Interest-bearing deposits................................... 429,411 429,411
-------- --------
Total deposits.......................................... $481,038 $481,038
======== ========
INDEBTEDNESS:
Short-term borrowings....................................... $ 10,039 $ 10,039
Federal Home Loan Bank advances............................. 64,125 64,125
Company Obligated Mandatorily Redeemable Trust Preferred
Securities of Subsidiary Trust Holding Solely Subordinated
Debentures................................................ -- 15,000
Other borrowings............................................ 13,150 13,150
-------- --------
Total indebtedness...................................... $ 87,314 $102,314
======== ========
SHAREHOLDERS' EQUITY:
Common Stock, $0.01 par value; 20,000,000 shares authorized;
6,560,124 shares issued and outstanding................... $ 65 $ 65
Capital surplus............................................. 42,026 42,026
Retained earnings........................................... 7,057 7,057
Accumulated other comprehensive income...................... (89) (89)
-------- --------
Total shareholders' equity.............................. $ 49,059 $ 49,059
======== ========
</TABLE>

In July 1999, we repurchased 233,219 shares of our common stock
in a privately negotiated transaction. The aggregate purchase price
was $2.33 million, which primarily was funded by a $2.00 million
borrowing under our revolving line of credit which had a zero
balance as of March 31, 1999 and will have a zero balance after the
application of $2.00 million of the net proceeds of this offering.

<TABLE>
<CAPTION>
MARCH 31, 1999
-------------------------------------------------------------
ACTUAL AS ADJUSTED
------------------------------------------- -----------
"WELL- EXCESS/
CAPITALIZED" (DEFICIT)
CAPITAL STANDARD<F1> CAPITAL CAPITAL<F2>
------- ------------- --------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
DOLLAR BASIS:
Total risk-based capital......... $43,086 $50,745 $(7,659) $58,086
Tier 1 risk-based capital........ 36,738 30,447 6,291 48,984
Tier 1 leverage capital.......... 36,738 29,936 6,802 48,984
PERCENTAGE BASIS:
Total risk-based capital ratio... 8.49% 10.00% 11.45%
Tier 1 risk-based capital ratio.. 7.24 6.00 9.65
Tier 1 leverage capital ratio.... 6.14 5.00 8.18

<CAPTION>
MARCH 31, 1999
---------------------------
AS ADJUSTED
---------------------------
"WELL-
CAPITALIZED" EXCESS
STANDARD<F1> CAPITAL
------------- -------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
DOLLAR BASIS:
Total risk-based capital......... $50,745 $ 7,341
Tier 1 risk-based capital........ 30,447 18,537
Tier 1 leverage capital.......... 29,936 19,048
PERCENTAGE BASIS:
Total risk-based capital ratio... 10.00%
Tier 1 risk-based capital ratio.. 6.00
Tier 1 leverage capital ratio.... 5.00

<FN>
- ---------
<F1> Reflects the minimum amount of capital necessary to meet the
"well-capitalized" regulatory standard. As of March 31, 1999, we exceeded
the minimum "well-capitalized" standard for both Tier 1 leverage and Tier
1 risk-based capital, but the level of total risk-based capital was below
the "well-capitalized" standard. Upon completion of this offering, we will
meet the "well-capitalized" standard for total risk-based capital.
<F2> Federal Reserve Board guidelines for calculation of Tier 1 capital limit
the aggregate amount of trust preferred securities, including securities
similar to the trust preferred securities, which can be included in Tier 1
capital to 25% of total Tier 1 capital. As of March 31, 1999, $12.25
million of the aggregate amount of trust preferred securities would have
qualified as Tier 1 capital, and the remaining amount would have qualified
as Tier 2 capital.
</TABLE>

ACCOUNTING TREATMENT

For financial reporting purposes, the Trust will be treated as
our subsidiary and, accordingly, the accounts of the Trust will be
included in our consolidated financial statements. The trust
preferred securities will be included in our consolidated balance
sheets under the caption "Company Obligated Mandatorily Redeemable
Trust Preferred Securities of Subsidiary Trust Holding Solely
Subordinated Debentures" and appropriate disclosures about the trust
preferred securities, the guarantee and the junior subordinated
debentures will be included in the notes to our consolidated
financial statements. For financial reporting purposes, we will
record distributions on the trust preferred securities in our
consolidated statements of income.

Our future reports filed under the Securities Exchange Act of
1934 will include a footnote to the consolidated financial
statements stating that:

* the Trust is wholly-owned;

* the sole assets of the Trust are the junior subordinated
debentures and specifying their principal amount, interest
rate and maturity date; and

* our obligations described in this prospectus, in the
aggregate, constitute a full, irrevocable and unconditional
guarantee on a subordinated basis by us of the obligations of
the Trust under the trust preferred securities.

<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA

The following is our selected consolidated financial
information. The balance sheet and income statement data as of and
for the five years ended December 31, 1998 are taken from our
audited consolidated financial statements as of the end of and for
each such year. The balance sheet and income statement data as of and
for the three months ended March 31, 1999 and 1998 are taken from
our unaudited condensed consolidated financial statements as of the
end of and for each such three-month period. The quarterly data include all
adjustments which are, in our opinion, necessary to present a fair
statement of these periods and are of a normal recurring nature.
Results for the three months ended March 31, 1999 are not
necessarily indicative of results for the entire year. You should
read this selected consolidated financial information in conjunction
with our consolidated financial statements and notes that appear in
this prospectus.

<PAGE>

<CAPTION>
THREE MONTHS
ENDED MARCH 31, YEARS ENDED DECEMBER 31,
------------------- ----------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
-------- -------- -------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges:
Including deposit interest............... 1.27x 1.16x 1.28x 1.19x 1.20x 1.19x 1.28x
Excluding deposit interest............... 2.31x 1.81x 2.38x 1.96x 1.99x 1.95x 2.64x
Allegiant Capital Ratios (at period-end):
Total risk-based capital................. 8.49% 8.29% 8.68% 8.14% 8.55% 11.51% 8.51%
Tier 1 risk-based capital................ 7.24 6.52 7.42 6.39 6.10 7.98 7.24
Tier 1 leverage capital.................. 6.14 4.84 5.83 6.15 4.38 5.12 4.98
Allegiant Bank Capital Ratios (at
period-end):
Total risk-based capital................. 10.63 9.18 10.93 9.35 10.06 13.48 12.56
Tier 1 risk-based capital................ 9.38 8.11 9.68 8.27 8.87 12.29 11.31
Tier 1 leverage capital.................. 7.81 6.31 7.61 7.76 6.37 8.67 8.42
Other Data:
Number of banking facilities at
period-end.............................. 14 15 13 14 8 7 6
Goodwill amortization.................... $250 $233 $910 $358 $67 $104 $68
</TABLE>

Our efficiency ratio is the quotient of our other expense over
the sum of our net interest income and other income.

For purposes of calculating the ratio of earnings to fixed charges,
earnings consist of earnings before income taxes plus interest and
one-half of rental expense. Fixed charges, excluding interest on
deposits, consist of interest on indebtedness and one-half of rental
expense (which is deemed representative of the interest factor).
Fixed charges, including interest on deposits, consists of the
foregoing items plus interest on deposits.

<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following should be read in connection with our consolidated
financial statements and related notes and the other financial
information included elsewhere in this prospectus.

OVERVIEW

The profitability of our operations depends on our net interest
income, provision for loan losses, other income and other expense.
Net interest income is the difference between the income we receive
on our loan and investment portfolios and our cost of funds, which
consists of interest paid on deposits and borrowings. The provision
for loan losses reflects the cost of credit risk in our loan portfolio.
Other income consists primarily of service charges on deposit accounts
and fees for ancillary banking services and, to a lesser extent,
revenues generated from our mortgage banking, securities brokerage,
insurance brokerage and trust operations. Other expense includes
salaries and employee benefits as well as occupancy, data processing,
marketing, professional fees, insurance and other expenses.

Net interest income is dependent on the amounts and yields of
interest earning assets compared to the amounts and rates on
interest bearing liabilities. Net interest income is sensitive to
changes in market rates of interest and our asset/liability
management procedures are intended to manage the risk presented by
changes in market interest rates. The provision for loan losses is
dependent on changes in the loan portfolio, management's assessment
of the collectibility of the loan portfolio and loss experience, as
well as economic and market factors.

Since the beginning of 1998, we have focused primarily on
improving the profitability of our banking operations. As a result,
we have reduced the amount of one- to four-family mortgages that we
hold in our loan portfolio and increased the amount of higher
yielding commercial loans. We also have hired several banking
professionals with experience in the St. Louis metropolitan area. We
have refined our market focus to concentrate exclusively on
opportunities in the higher-growth St. Louis metropolitan area and,
accordingly, we sold three retail banking offices outside the St.
Louis metropolitan area in December 1998. We also have implemented
company-wide cost-control efforts to enhance efficiencies at our
entire operations.

Our primary financial strategies are to continue to grow our
loan portfolio while maintaining high asset quality, expand our core
deposit base to provide a cost-effective and stable source of
funding for our loan portfolio and increase other income while
maintaining strong expense controls. We believe we have maintained
high asset quality while managing growth both internally and by
acquisition. We also believe our history of strong credit quality
has resulted from sound credit practices.

RESULTS OF OPERATIONS

COMPARISON OF THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998.
Net income for the three months ended March 31, 1999 was $1.00
million, a 59.8% increase over the $0.63 million earned for the
first quarter of 1998. Both basic earnings per share and diluted
earnings per share were $0.15 for the first quarter of 1999 compared
to basic and diluted earnings per share for the first quarter of
1998 of $0.10 and $0.09, respectively. The annualized return on
average assets for the first quarter of 1999 was 0.67% and
represents a 63.41% improvement over the 0.41% annualized return on
average assets reported for the first quarter of 1998. The return on
average equity on an annualized basis was 8.41% for the first
quarter of 1999 compared to 5.98% for the first quarter of 1998.

We experienced modest growth during the first quarter of 1999.
Period-end total assets increased $24.58 million, or 4.12%, from
$596.27 million at December 31, 1998. Asset growth during the period
was primarily in loans which before allowance for loan losses,
increased $24.64 million, or 5.0%. Deposit balances increased $30.27
million, or 6.72%, during the first quarter of 1999. Money market
accounts increased $29.52 million representing the majority of the
net deposit growth during the quarter. This growth was a result of
efforts to promote our new money market product. Certificates of
deposit increased by a net of $5.71 million

<PAGE>
during the first quarter of 1999, including a $20 million increase
in brokered certificates of deposit issued in February.

Net Interest Income. Net interest income for the three months
ended March 31, 1999 was $11.93 million, a 2.81% decrease compared
to the $12.27 million reported for the first quarter of 1998. This
$0.34 million decline was attributable to a slightly lower yield on
earning assets and a decrease of $10.56 million in average earning
assets. The change in average earning assets reflected a decrease in
investment securities of $16.18 million from the first quarter of
1998 to the first quarter of 1999. The reduction in investment
securities provided funds for maturing certificates of deposit which
were not renewed. The decrease in investment securities was
partially offset by a $2.21 million increase in average loans and a
$3.40 million increase in average overnight investments.

Net interest margin for the first quarter of 1999 increased 36
basis points compared to the first quarter of 1998. The earning
assets yield declined 8 basis points while our efforts to shift
maturing certificates of deposit into other deposit accounts at
lower rates resulted in a 48 basis point reduction in the overall
interest rate paid on interest bearing deposits. The net interest
spread increased 33 basis points comparing the first quarter 1999 to
the first quarter 1998.

Interest expense on deposits declined $0.76 million due to a
$20.90 million decline in average interest bearing deposits and due
to a decline in the rate paid on deposits from 5.23% in the first
quarter of 1998 to 4.75% for the comparable period in 1999. The
decrease in interest expense on deposits consisted primarily of a
$1.05 million decline in interest expense on certificates of
deposit, offset by a $0.34 million increase in interest expense on
money markets and NOW accounts. The average balance in certificates
of deposit decreased by $56.73 million during the first quarter of
1999 as compared to the first quarter of 1998 and the rate paid
declined 41 basis points between those periods. The decrease in
average deposits included a $39.99 million reduction from the
December 1998 sale of three branches of the bank located outside the
St. Louis metropolitan area.

The rate paid on other borrowings also contributed to the net
interest margin improvement. The rate paid on other borrowings
declined from 7.60% for the first quarter of 1998 to 5.97% for the
first quarter of 1999. During October 1998, we refinanced a portion
of our long-term debt and all outstanding subordinated debentures
with a $13.65 million, 7.00% fixed rate, three-year loan. This
refinancing caused the rate paid on other borrowings to decline 163
basis points in the first quarter of 1999 compared to the first
quarter of the previous year. The decrease in the average rate on
other borrowings was offset by a 79 basis point increase in the rate
paid on short-term borrowings in the first quarter of 1999 as
compared to the first quarter of 1998.

<PAGE>
The following table sets forth the condensed average balance
sheets for the periods reported. Also shown is the average yield on
each category of interest earning assets and the average rate paid
on interest bearing liabilities for each of the periods reported.

<TABLE>
DISTRIBUTION OF AVERAGE ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY
AND INTEREST RATES

<CAPTION>
THREE MONTHS ENDED MARCH 31,
------------------------------------------------------------------------------------------
1999 1998
------------------------------------------ ------------------------------------------
AVERAGE INTEREST AVERAGE AVERAGE INTEREST AVERAGE
BALANCE EARNED/PAID YIELD/RATE BALANCE EARNED/PAID YIELD/RATE
-------- ----------- ---------- -------- ----------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Interest earning assets:
Loans<F1>........................ $507,830 $11,074 8.84% $505,618 $11,142 8.94%
Taxable investment securities.... 51,217 755 5.90 67,330 1,072 6.37
Non-taxable investment
securities<F2>................. 1,416 17 4.87 1,478 14 3.84
Federal funds sold and other
investments.................... 6,807 79 4.71 3,407 42 5.00
-------- ------- -------- -------
Total interest earning
assets..................... 567,270 11,925 8.53 577,833 12,270 8.61
-------- ------- -------- -------
Non-interest earning assets:
Cash and due from banks.......... 15,476 9,876
Bank premises and equipment...... 10,967 10,615
Other assets..................... 23,667 28,650
Allowance for loan losses........ (6,325) (5,349)
-------- --------
Total assets................. $611,055 $621,625
======== ========
LIABILITIES AND SHAREHOLDERS'
EQUITY:
Interest bearing liabilities:
Money market and NOW accounts.... $155,055 1,530 4.00% $116,030 1,186 4.15%
Savings deposits................. 14,877 79 2.15 16,322 109 2.71
Certificates of deposit.......... 192,664 2,575 5.42 233,878 3,356 5.82
Certificates of deposit over
$100,000....................... 33,474 399 4.83 48,988 672 5.56
IRA certificates................. 18,669 273 5.93 20,423 295 5.86
-------- ------- -------- -------
Total interest bearing
deposits................... 414,739 4,856 4.75 435,641 5,618 5.23
-------- ------- -------- -------
Federal funds purchased,
repurchase agreements and other
short-term borrowings.......... 51,936 639 4.99 54,429 564 4.20
Other borrowings................. 40,275 593 5.97 35,163 659 7.60
-------- ------- -------- -------
Total interest bearing
liabilities................ 506,950 6,088 4.87 525,233 6,841 5.28
-------- ------- -------- -------
Non-interest bearing liabilities
and equity:
Demand deposits.................. 51,796 45,846
Other liabilities................ 3,996 8,002
Shareholders' equity............. 48,313 42,544
-------- --------
Total liabilities and
shareholders' equity....... $611,055 $621,625
======== ========
Net interest income.......... $ 5,837 $ 5,429
======= =======
Net interest spread.......... 3.66% 3.33%
Net interest margin.......... 4.17% 3.81%

<FN>
- --------
<F1> Average balances include non-accrual loans.
<F2> Presented at actual yield rather than tax-equivalent yield.
</TABLE>

<PAGE>
The following table sets forth for the periods indicated the
changes in interest income and interest expense which were
attributable to change in average volume and changes in average
rates. Volume variances are computed using the change in volume
multiplied by the previous year's rate. Rate variances are computed
using the changes in rate multiplied by the previous year's volume.
The change in interest due to both rate and volume has been
allocated between the factors in proportion to the relationship of
the absolute dollar amounts of the change in each.

<TABLE>
RATE/VOLUME ANALYSIS

<CAPTION>
QUARTER ENDED MARCH 31,1999
COMPARED TO THE
QUARTER ENDED MARCH 31, 1998
-----------------------------------
VOLUME RATE NET CHANGE
------ ----- ----------
(IN THOUSANDS)
<S> <C> <C> <C>
INTEREST EARNED ON:
Loans............................................... $ 49 $(117) $ (68)
Taxable investment securities....................... (242) (75) (317)
Non-taxable investment securities................... (1) 4 3
Federal funds sold and other investments............ 40 (3) 37
----- ----- -----
Total interest income........................... (154) (191) (345)
----- ----- -----

INTEREST PAID ON:
Money market and NOW accounts....................... 386 (42) 344
Savings deposits.................................... (9) (21) (30)
Certificates of deposit............................. (562) (219) (781)
Certificates of deposit over $100,000............... (193) (80) (273)
IRA certificates.................................... (26) 4 (22)
Federal funds purchased, repurchase agreements and
other short-term borrowings....................... (27) 102 75
Other borrowings.................................... 88 (154) (66)
----- ----- -----
Total interest expense.......................... (343) (410) (753)
----- ----- -----
Net interest income............................. $ 189 $ 219 $ 408
===== ===== =====
</TABLE>

Other Income. Other income increased by $0.14 million to $1.25
million for the three months ended March 31, 1999 compared to $1.11
million in the first quarter in 1998.

Service charge income for the three-month period ended March 31,
1999 increased $0.11 million, or 43.1%, compared to the first
quarter of 1998. This increase was attributable to our focus on
revenue enhancement programs. Operating lease income increased 4.2%
to $0.30 million for the quarter ended March 31, 1999 from $0.28
million for the comparable period in 1998. The small increase in
income was related to the decision to decrease production of
operating leases during the latter half of 1998.

For the quarter ended March 31, 1999 mortgage banking revenue
was $0.36 million compared to $0.49 million for the quarter ended
March 31, 1998, a 26.6% decrease. The change was primarily the
result of a decrease in servicing fee income due to a reduction in
the servicing portfolio. Other non-interest income increased 183.3%
for the three-month period ended March 31, 1999 to $0.24 million,
compared to $0.08 million for the first quarter of 1998.

Other Expenses. For the three months ended March 31, 1999
compared to the first quarter of 1998, other expenses decreased
$0.26 million to $4.86 million from $5.12 million, a 5.1% decline.

<PAGE>
Salaries and employee benefits increased 5.7% to $2.45 million
for the three months ended March 31, 1999 compared to $2.31 million
for the three months ended March 31, 1998. Additional expenses were
incurred due to management and support staff additions throughout 1998
and into 1999, offset by the sale in December 1998 of three branches
of the bank outside the St. Louis metropolitan area. We had 228
full-time equivalent employees at March 31, 1999 compared to 255
full-time equivalent employees at March 31, 1998. Total annualized
cost per full-time equivalent employee was $42,895 for the three months
ended March 31, 1999 compared to $36,298 for the corresponding
period of 1998.

Expenses associated with premises and equipment decreased for
the three-month period ended March 31, 1999 as compared to the same
period in 1998, with occupancy expense decreasing $0.05 million and
furniture and equipment decreasing $0.01 million. Advertising costs
decreased 40.3% from first quarter 1998 to the comparable period of
1999. In early 1998, management made a decision to commit additional
resources to promote the larger organization due to the significant
growth that occurred from 1997 to 1998. Advertising costs through
March 31, 1999 were $0.09 million compared to $0.14 million for the
first quarter of 1998.

Operating lease depreciation decreased by $0.08 million to $0.22
million for the three months ended March 31, 1999 from $0.30 million
for the three months ended March 31, 1998. This decrease also was
reflective of our decision to decrease production of operating
leases in the latter half of 1998.

Total other expenses for the three months ended March 31, 1999
decreased $0.13 million, or 11.2%, totaling $1.02 million compared
to $1.15 million for the three months ended March 31, 1998. The
decline in other expenses was a direct result of our efforts to
control operating costs.

Our efficiency ratio was 68.5% for the quarter ended March 31,
1999 compared to 78.3% for the first quarter of 1998. This positive
change in the efficiency ratio was a direct result of fewer offices
due to the sale of the three branch offices. This improvement
reflects our commitment to improving our overall efficiency by
continuing to emphasize revenue growth while decreasing our current
level of operating expense.

<PAGE>
The following table sets forth a summary of our other income and
expense for the periods indicated:

<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
-------------------
1999 1998
------ ------
(IN THOUSANDS)
<S> <C> <C>
OTHER INCOME:
Mortgage banking revenues........................... $ 359 $ 489
Leasing revenues.................................... 295 283
Service charges on deposits......................... 362 253
Gain on the sale of securities...................... -- 12
Other non-interest income........................... 238 72
------ ------
Total other income.............................. $1,254 $1,109
====== ======

OTHER EXPENSES:
Salaries and employee benefits...................... $2,445 $2,314
Furniture and equipment............................. 415 431
Occupancy........................................... 349 403
Depreciation of operating leases.................... 215 295
Goodwill amortization............................... 250 233
Advertising......................................... 86 144
Supplies............................................ 76 147
Other non-interest expense.......................... 1,022 1,151
------ ------
Total other expenses............................ $4,858 $5,118
====== ======
</TABLE>

Securities Portfolio. Our securities portfolio consists of
securities classified as held-to-maturity and available-for-sale. We
designate these securities upon purchase into one of these two
categories. At March 31, 1999, held-to-maturity securities amounted
to $10.85 million representing those securities we intended to hold
to maturity. Securities designated as available-for-sale totaled
$45.08 million representing securities which we may sell to meet
liquidity needs or in response to significant changes in interest
rates or prepayment patterns.

For purposes of this discussion, held-to-maturity and
available-for-sale securities are described as the securities portfolio.
At March 31, 1999, the securities portfolio totaled $55.93 million,
a decline of 3.89% from March 31, 1998. The decline in the securities
portfolio occurred in the fourth quarter of 1998, as maturities were
not rolled over in order to fund the previously mentioned branch sales.
We maintain a traditional short-term laddered portfolio investment
strategy to insure adequate liquidity while minimizing interest rate risk.

<PAGE>
The carrying values of the securities portfolio at the dates
indicated were as follows:

<TABLE>
SECURITIES PORTFOLIO

<CAPTION>
MARCH 31, DECEMBER 31, MARCH 31,
1999 1998 1998
--------- ------------ ---------
(IN THOUSANDS)
<S> <C> <C> <C>
U.S. governmental and agency securities........... $39,424 $37,021 $33,833
Mortgage-backed securities........................ 10,792 11,930 14,322
Federal Home Loan Bank stock...................... 3,574 3,574 7,033
States and municipal securities................... 1,346 1,464 1,555
Other securities.................................. 791 791 1,448
------- ------- -------
Total securities................................ $55,927 $54,780 $58,191
======= ======= =======
</TABLE>

Maturities and yield information of the securities
portfolio as of March 31, 1999 were as follows:

<TABLE>
SECURITIES PORTFOLIO--MATURITIES AND YIELDS<F1>

<CAPTION>
WEIGHTED OVER ONE WEIGHTED OVER FIVE WEIGHTED WEIGHTED
ONE YEAR AVERAGE THROUGH AVERAGE THROUGH AVERAGE OVER TEN AVERAGE
OR LESS YIELD FIVE YEARS YIELD TEN YEARS YIELD YEARS YIELD
-------- -------- ---------- -------- --------- -------- -------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. governmental and
agency securities........ $10,520 5.58% $22,967 5.75% $5,937 6.03% $ -- --%
Mortgage-backed
securities............... 4,609 6.56 6,183 5.68 -- -- -- --
Federal Home Loan Bank
stock.................... 3,574 6.25 -- -- -- -- -- --
States and municipal
securities............... 252 4.95 160 5.06 707 4.91 227 4.91
Other securities........... 396 6.42 395 6.76 -- -- -- --
------- ------- ------ -------
Total securities....... $19,351 5.95 $29,705 5.75 $6,644 5.91 $ 227 4.91
======= ======= ====== =======
Total securities
portfolio............ $55,927 5.83%
=======

<FN>
- ---------
<F1> Maturities are shown in this table by expected maturity. Expected
maturities differ from contractual maturities due to the right to call or
prepay obligations. Yields on tax-exempt obligations have been presented
on an actual basis rather than on a tax-equivalent basis.
</TABLE>

Loans. Loans have historically been the primary component of
earning assets. At March 31, 1999, loans totaled $520.31 million, an
increase of 4.97% from year-end 1998. Substantially all of these
loans were originated in our market area. At March 31, 1999,
we had no foreign loans and only a minimal amount of participations
purchased.

The largest increase in loans involved real estate construction
loans, which increased $10.13 million, or 27.67%, during the first
quarter of 1999. The increase was primarily due to loans made to home
builders. Multi-family and commercial real estate mortgage loans
showed the second largest increase of $8.65 million, or 0.44%. The
increase in these loans reflects our efforts to grow our commercial
loan portfolio, including loans originated by our expanded commercial
lending staff. As a result of this emphasis, real estate construction
loans comprised 8.98% of the loan portfolio at March 31, 1999 as compared
to 7.38% at December 31, 1998. Multi-family and commercial real estate
mortgage loans comprised 39.44% of the portfolio at March 31, 1999 versus
39.65% at year-end 1998. Additionally, commercial loans increased 2.60%,
totaling $129.52 million at March 31, 1999 compared to $126.24
million at year-end 1998.

<PAGE>
The following tables summarize the composition of our loan
portfolio at the dates indicated:

<TABLE>
LOAN PORTFOLIO--TYPES OF LOANS

<CAPTION>
MARCH 31, 1999 DECEMBER 31, 1998 MARCH 31, 1998
----------------------- ----------------------- -----------------------
PERCENT PERCENT PERCENT
AMOUNT OF TOTAL AMOUNT OF TOTAL AMOUNT OF TOTAL
-------- -------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
Commercial, financial, agricultural,
municipal and industrial
development........................... $129,523 24.89% $126,239 25.47% $ 93,888 18.51%
Real estate--construction............... 46,717 8.98 36,590 7.38 26,622 5.25
Real estate--mortgage
One- to four-family residential..... 117,894 22.66 116,291 23.46 224,758 44.32
Multi-family and commercial......... 205,192 39.44 196,545 39.65 145,808 28.75
Consumer and other, net of unearned
income.................................. 20,980 4.03 20,004 4.04 16,080 3.17
-------- ------ -------- ------ -------- ------
Total loans......................... $520,306 100.00% $495,669 100.00% $507,156 100.00%
======== ====== ======== ====== ======== ======
</TABLE>

<TABLE>
LOAN PORTFOLIO--MATURITIES AND SENSITIVITIES OF LOANS

<CAPTION>
MARCH 31, 1999
------------------------------------------------------------------------------------------
MATURING AFTER ONE YEAR MATURING AFTER
MATURING IN THROUGH FIVE YEARS FIVE YEARS
ONE YEAR ------------------------- -------------------------
OR LESS FIXED-RATE VARIABLE FIXED-RATE VARIABLE TOTAL
----------- ---------- -------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
(IN THOUSANDS)
Commercial, financial,
agricultural, municipal and
industrial development........... $ 99,228 $ 28,278 $ 378 $ 1,639 $ -- $129,523
Real estate--construction.......... 45,504 507 -- 706 -- 46,717
Real estate--mortgage
One- to four-family
residential.................... 83,874 29,216 479 4,325 -- 117,894
Multi-family and commercial.... 98,470 101,311 724 4,687 -- 205,192
Consumer and other, net of unearned
income........................... 11,064 9,732 -- 184 -- 20,980
-------- -------- ------ ------- ------- --------
Total loans.................... $338,140 $169,044 $1,581 $11,541 $ -- $520,306
======== ======== ====== ======= ======= ========
</TABLE>

Asset Quality. Non-performing assets consist of the following:
nonaccrual loans on which the ultimate collectibility of the full
amount of interest is uncertain; loans which have been renegotiated
to provide for a reduction or deferral of interest or principal
because of a deterioration in the financial condition of the
borrower; and loans past due 90 days or more as to principal or
interest and other real estate owned. Non-performing assets
increased to $1.91 million at March 31, 1999 as compared to $1.41
million at March 31, 1998. At March 31, 1999, non-performing assets
represented 0.31% of total assets compared to 0.23% of total assets
at March 31, 1998. Non-accrual loans were $1.51 million at March 31,
1999 as compared to $0.47 million at March 31, 1998. This increase
was partially offset by declines in loans delinquent 90 days or
more, reflecting migration to non-accrual status, and by liquidation
of other real estate owned.

We continually analyze our loan portfolio to identify potential
risk elements. The loan portfolio is reviewed by lending management
and the bank's internal loan review staff. As an integral part of
their examination process, the various regulatory agencies
periodically review our allowance for loan losses. We believe that
our allowance for loan losses at March 31, 1999 was consistent with
applicable regulatory requirements.

<PAGE>
The following table summarizes, at the dates presented,
non-performing assets by category:

<TABLE>
RISK ELEMENTS--NONACCRUAL, PAST DUE AND RESTRUCTURED LOANS

<CAPTION>
MARCH 31, DECEMBER 31, MARCH 31,
1999 1998 1998
--------- ------------ ---------
<S> <C> <C> <C>
(DOLLARS IN THOUSANDS)
COMMERCIAL, FINANCIAL, AGRICULTURAL, MUNICIPAL AND
INDUSTRIAL DEVELOPMENT:
Past due 90 days or more........................ $ -- $ -- $ --
Non-accrual..................................... 394 962 319
Restructured terms.............................. -- -- --

REAL ESTATE--CONSTRUCTION:
Past due 90 days or more........................ -- -- --
Non-accrual..................................... -- -- 24
Restructured terms.............................. -- -- --

REAL ESTATE--MORTGAGE:
One- to four-family residential:
Past due 90 days or more........................ 396 69 491
Non-accrual..................................... 849 378 63
Restructured terms.............................. -- -- --
Multi-family and commercial:
Past due 90 days or more........................ -- -- --
Non-accrual..................................... 241 307 50
Restructured terms.............................. -- -- --

CONSUMER AND OTHER, NET OF UNEARNED INCOME:
Past due 90 days or more........................ -- -- 30
Non-accrual..................................... 30 62 14
Restructured terms.............................. -- -- --
------ ------ ------
Total non-performing loans.......................... 1,910 1,778 991
------ ------ ------
Other real estate................................... -- -- 422
------ ------ ------
Total non-performing assets......................... $1,910 $1,778 $1,413
====== ====== ======
RATIOS:
Non-performing loans to total loans............. 0.37% 0.36% 0.20%
Non-performing assets to total assets........... 0.31 0.30 0.23
Non-performing loans to shareholders' equity.... 3.89 3.70 2.30
Allowance for loan losses to total loans........ 1.30 1.30 1.07
Allowance for loan losses to non-performing
loans......................................... 354.24 362.32 547.43
</TABLE>

Interest income that would have been recorded during the three
months ended March 31, 1999 had all non-accrual, past due and
restructured loans been current in accordance with their original
terms was immaterial.

Allowance for Loan Losses. The provision for loan losses was
$0.56 million during the first three months of 1999 compared to
$0.40 million for the first quarter of 1998. Net charge-offs were
$0.24 million for the three months ended March 31, 1999 compared to
$0.17 million for the first quarter of 1998. Net charge-offs for the
first three months of 1999 represented 0.05% of average loans,
compared to 0.03% of average loans for the first three months of
1998.

<PAGE>
The allowance for loan losses increased to $6.77 million at
March 31, 1999 compared to $5.43 million at March 31, 1998. As a
percentage of loans outstanding, the allowance represented 1.30% of
loans at March 31, 1999 and December 31, 1998 and 1.07% at March 31,
1998.

The higher expense provision and the higher allowance percentage
were the result of the change in the composition of the loan
portfolio at March 31, 1999 compared to March 31, 1998. Since early
1998, we have been focused on generating higher yielding loans from
the commercial and industrial underwriting areas rather than lower
yielding residential mortgage loans. This increase in risk as a
result of the change in loan mix was reflected in the higher provision
and higher allowance as a percentage of loans outstanding.

Non-performing assets increased to $1.91 million at March 31,
1999 compared to $1.78 million at December 31, 1998 and $1.41
million at March 31, 1998. This increase includes a greater number
of non-accrual residential mortgage loans. The non-performing assets
at March 31, 1999 included one loan of $0.66 million on a single
family residential property which, as of June 30, 1999, was
collected without incurring a loss. Non-performing assets as a
percentage of total assets increased to 0.31% at March 31, 1999 from
0.23% at March 31, 1998. From year-end 1998, the percentage
increased one basis point.

The allowance for loan losses is provided at a level considered
adequate to provide for potential loan losses and, among other
things, is based on management's evaluation of the anticipated
impact on the loan portfolio of current economic conditions, changes
in the character and size of the loan portfolio, evaluation of
potential problem loans identified based on existing circumstances
known to management, potential future loan losses on loans to
specific customers or industries and recent loan loss experience. We
continually monitor the quality of our loan portfolio to ensure the
timely charge-off of problem loans and to determine the adequacy of
the level of the allowance for loan losses. We presently believe
that our asset quality, as measured by the statistics in the
following table, continues to be very high and that our allowance is
adequate to absorb potential losses inherent in the portfolio at
March 31, 1999.

The following table summarizes the allocation of the allowance
for loan losses by major category and identifies the percentage of
each loan category to the total loan portfolio balance:

<TABLE>
ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES

<CAPTION>
MARCH 31,
-------------------------------------------------------
1999 1998
------------------------ ------------------------
ALLOCATED PERCENT ALLOCATED PERCENT
ALLOWANCE OF LOANS ALLOWANCE OF LOANS
--------- -------- --------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
Commercial, financial, agricultural, municipal
and industrial development.................... $1,459 24.89% $1,248 18.51%
Real estate--construction....................... 528 8.98 303 5.25
Real estate--mortgage
One- to four-family residential............ 1,221 22.66 727 44.32
Multi-family and commercial................ 2,901 39.44 1,432 28.75
Consumer and other.............................. 235 4.03 163 3.17
Unallocated..................................... 423 -- 1,552 --
------ ------ ------ ------
Total....................................... $6,767 100.00% $5,425 100.00%
====== ====== ====== ======
</TABLE>

<PAGE>
The following table summarizes, for the periods indicated,
activity in the allowance for loan losses, including amounts of
loans charged off, amounts of recoveries and additions to the
allowance charged to operating expenses.

<TABLE>
SUMMARY OF LOAN LOSS EXPERIENCE AND RELATED INFORMATION

<CAPTION>
THREE MONTHS ENDED
MARCH 31,
-----------------------
1999 1998
-------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
ALLOWANCE FOR LOAN LOSSES (BEGINNING OF PERIOD)..... $ 6,442 $ 5,193
Loans charged off:
Commercial, financial, agricultural, municipal
and industrial development.................... (132) (105)
Real estate--construction....................... -- --
Real estate--mortgage
One- to four-family residential............. (69) (24)
Multi-family and commercial................. -- (25)
Consumer and other.............................. (39) (21)
-------- --------
Total loans charged off............................. (240) (175)
-------- --------

Recoveries of loans previously charged off:
Commercial, financial, agricultural, municipal
and industrial development.................... -- 1
Real estate--construction....................... -- --
Real estate--mortgage
One- to four-family residential............. 1 --
Multi-family and commercial................. -- --
Consumer and other.............................. 2 6
-------- --------
Total recoveries.................................... 3 7
-------- --------

Net loans charged off............................... (237) (168)
-------- --------
Provision for loan losses........................... 562 400
-------- --------
Allowance for loan losses (end of period)........... $ 6,767 $ 5,425
======== ========
LOANS OUTSTANDING:
Average......................................... $507,830 $505,618
End of period................................... 520,305 507,156

RATIOS:
Net charge-offs to average loans................ 0.05% 0.03%
Net charge-offs to provision for loan losses.... 42.35 42.00
Provision for loan losses to average loans...... 0.11 0.08
Allowance for loan losses to total loans........ 1.30 1.07
</TABLE>

Deposits. Total deposits increased $30.27 million, or 6.72%, in
the first quarter of 1999 as compared to a decrease in deposits of
$4.87 million, or 1.00%, in the first quarter of 1998. The 1999
increase was a result of an increase in demand deposits and money
market and NOW accounts offset by a decline in certificates of
deposit, which decline was the result of the sale of the three
branch offices of the bank previously mentioned. The majority of
deposits sold were in the certificate of deposit category, hence the
decline in certificates of deposit as a percent of total deposits to
50.65% at March 31, 1999 from 62.10% at March 31, 1998. In addition,
the reduction in large certificates of deposit was the result of
management's decision to replace these rate sensitive funds with
core deposits.

<PAGE>
The following tables summarizes deposits as of the dates
indicated:

<TABLE>
DEPOSIT LIABILITY COMPOSITION

<CAPTION>
MARCH 31, 1999 DECEMBER 31, 1998
------------------------------ ------------------------------
PERCENT AVG. PERCENT AVG.
AMOUNT OF TOTAL RATE AMOUNT OF TOTAL RATE
-------- -------- ---- -------- -------- ----
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
Demand deposits................ $ 51,627 10.73% --% $ 55,417 12.29% --%
Money market and NOW accounts.. 170,772 35.50 4.00 142,902 31.70 4.12
Savings deposits............... 15,031 3.12 2.15 14,917 3.31 2.57
Certificates of deposit........ 191,740 39.86 5.42 187,886 41.68 5.73
Certificates of deposit over
$100,000..................... 33,033 6.87 4.83 31,173 6.92 5.55
IRA certificates............... 18,835 3.92 5.93 18,471 4.10 5.96
-------- ------ -------- ------
Total deposits............. $481,038 100.00% $450,766 100.00%
======== ====== ======== ======

<CAPTION>
MARCH 31, 1998
------------------------------
PERCENT AVG.
AMOUNT OF TOTAL RATE
-------- -------- ----
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Demand deposits................ $ 44,262 9.23% --%
Money market and NOW accounts.. 120,925 25.20 4.15
Savings deposits............... 16,666 3.47 2.71
Certificates of deposit........ 233,120 48.59 5.82
Certificates of deposit over
$100,000..................... 44,711 9.32 5.56
IRA certificates............... 20,092 4.19 5.86
-------- ------
Total deposits............. $479,776 100.00%
======== ======
</TABLE>

<TABLE>
AMOUNTS AND MATURITIES OF TIME DEPOSITS OF $100,000 OR MORE

<CAPTION>
MARCH 31, 1999
--------------
<S> <C>
(IN THOUSANDS)
Three months or less................................ $ 9,336
Over three months through six months................ 10,138
Over six through twelve months...................... 9,153
Over twelve months.................................. 4,406
-------
Total........................................... $33,033
=======
</TABLE>

COMPARISON OF THE YEARS ENDED DECEMBER 31, 1998 AND 1997. We
reported record earnings for 1998. Consolidated net income was $4.53
million, an increase of 87.74% over the 1997 level of $2.42 million.
The 1998 results represented our seventh consecutive year of record
earnings. Net income has increased at a compound rate of 78.24% over
the past five years. Basic earnings per share were $0.72 compared to
$0.54 in 1997, an increase of 33.33%. A similar increase was
achieved in diluted earnings per share with 1998 results of $0.68
increasing 38.78% compared to the $0.49 recorded for 1997. Diluted
earnings per share have grown at a compound rate of 33.56% during
the last five years.

Return on average assets for 1998 was 0.73%, an improvement from
0.52% recorded for 1997. The improvement in return on assets was the
result of lower asset growth, improved net interest income, improved
mix of earning assets and a considerable increase in shareholders'
equity. Return on average shareholders' equity was 10.14% in 1998
compared to 9.55% in 1997. The improvement in 1998 was achieved
despite a 76.82% increase in average equity between 1998 and 1997.

Net Interest Income. Net interest income totaled $21.95 million,
an increase of $5.65 million in 1998 compared to an increase of
$6.24 million in 1997. The net interest spread increased by 13 basis
points and the net interest margin increased by 11 basis points from
the prior year. All of these increases were the result of a
relatively stable rate environment, the shifting of earning assets
into higher yielding loans and overall growth in average earning
assets and interest bearing liabilities. Partially offsetting these
positive factors were the declines in the prime lending rate which
affected our floating rate loans, the decline in the ratio of
earning assets to total assets and a decline in non-interest bearing
demand deposits to total deposits. Net interest margin and net
interest spread were fairly stable throughout the year, with only
minor quarterly fluctuations. The increase in net interest spread
was due to the yields on earning assets declining only 2 basis
points year-to-year compared to a decline of 15 basis points on
interest bearing liabilities. In 1997, the spread increased 28 basis
points as a result of similar changes on both sides of the balance
sheet, earning assets increasing 14 basis points and interest
bearing liabilities decreasing 14 basis points. In 1998, the yield
on loans declined by 16 basis points. However, this decline was
offset by an increase in the ratio of loans to total earning assets
improving to 85.96% in 1998 compared to 83.17% in 1997. Generally
flat or lower rates

<PAGE>
were paid on all categories of interest bearing liabilities. Total
cost of deposits declined 11 basis points due to a reduction of
rates paid on money market and NOW accounts, savings deposits and
retail certificates of deposit. Further reduction in the costs of
short-term and long-term borrowings also helped lower the overall
costs of funds, despite the substantial increase in long-term debt.

Average earning assets increased $134.61 million, or 30.62%,
during 1998 compared to an increase of $143.23 million, or 48.33%,
in 1997. Average loans increased 35.01%, or $128.00 million,
compared to growth of 57.35%, or $133.30 million, in 1997. The
growth in average loans includes the bulk sale of mortgage loans
that occurred during the second and third quarters of 1998. These
sales, which aggregated $77.04 million, decreased average loans
outstanding for the year by approximately $34.32 million. Our
securities portfolio (held-to-maturity and available-for sale)
increased 9.25% during 1998 compared to an increase of 7.41% in
1997. Average investment securities represented 12.46% of earning
assets during 1998 compared to 14.91% during 1997. This decline in
the relative amount of investment securities was directly correlated
to the increase in the percentage of loans to earning assets
mentioned above. In essence, strong loan growth necessitated the
reduction in the growth of the securities portfolio. Earning assets
as a percentage of total assets declined again in 1998 to 92.76%
from 94.94% in 1997. The increase in non-earning assets was the
result of opening additional branch locations as well as
acquisitions, which increased the number of branches and intangible
assets. This growth was somewhat mitigated by the sale of three
branch offices of the bank located outside the St. Louis
metropolitan area, which occurred in December of 1998. The impact of
this change to average balances was minimal due to the timing of the
consummation of our branch sales.

Average interest bearing liabilities increased 30.61%, or
$121.97 million, for 1998 compared to an increase of $127.23
million, or 46.91%, in 1997. Average deposits increased 29.96% to
$475.74 million compared to $366.07 million in 1997. As was the case
in 1997, only moderate changes occurred in the mix of deposits.
During 1998, certificates of deposit over $100,000 declined as a
percent of total deposits while retail certificates of deposit
increased. Non-interest bearing deposits as a percentage of total
deposits declined only 10 basis points to 10.00% from 10.10%. The
substantial growth in average deposits and the relatively stable mix
allowed for the average cost of interest bearing deposits to decline
by 11 basis points.

Average short-term borrowings were flat during the year
averaging $52.86 million during 1998 compared to $52.70 million
during 1997. The level of short-term borrowings during 1998 was
consistent throughout the year with only minor fluctuations between
quarters.

Average long-term debt for 1998 increased 136.54%, or $22.75
million. The majority of this increase was due to long-term
borrowings from the Federal Home Loan Bank of $26.63 million at
December 31, 1998, a $17.00 million change from December 31, 1997.
We use the Federal Home Loan Bank as a cost-effective source of
funding loans. Additionally, during November 1998, we refinanced a
portion of our long-term debt and our entire issue of subordinated
debentures with a $13.65 million, 7.00% fixed rate, three-year note.

<PAGE>
The following table sets forth the condensed average balance
sheets for the periods reported. Also shown is the average yield on
each category of interest earning assets and the average rate paid
on interest-bearing liabilities for each of the periods reported.

<TABLE>
DISTRIBUTION OF AVERAGE ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY
AND INTEREST RATES

<CAPTION>
YEARS ENDED DECEMBER 31,
------------------------------------------------------------------------------------------
1998 1997
------------------------------------------ ------------------------------------------
AVERAGE INTEREST AVERAGE AVERAGE INTEREST AVERAGE
BALANCE EARNED/PAID YIELD/RATE BALANCE EARNED/PAID YIELD/RATE
-------- ----------- ---------- -------- ----------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Interest earning assets:
Loans<F1>...................... $493,619 $44,411 9.00% $365,615 $33,473 9.16%
Taxable investment
securities................... 70,079 4,223 6.03 64,384 3,910 6.07
Non-taxable investment
securities<F2>............... 1,494 73 4.89 1,130 56 4.96
Federal funds sold and other
investments.................. 9,036 511 5.66 8,492 326 3.84
-------- ------- -------- -------
Total interest earning
assets................... 574,228 49,218 8.57 439,621 37,765 8.59
Non-interest earning assets:
Cash and due from banks........ 12,230 9,341
Bank premises and equipment.... 10,994 6,869
Other assets................... 27,238 11,065
Allowance for loan losses...... (5,674) (3,867)
-------- --------
Total assets............... $619,016 $463,029
======== ========
LIABILITIES AND SHAREHOLDERS'
EQUITY:
Interest bearing liabilities:
Money market and NOW accounts.. $126,829 5,221 4.12% $ 95,431 4,092 4.29%
Savings deposits............... 16,524 425 2.57 9,665 279 2.89
Certificates of deposit........ 224,661 12,878 5.73 162,870 9,436 5.79
Certificates of deposit over
$100,000..................... 39,581 2,198 5.55 48,358 2,686 5.55
IRA certificates............... 20,584 1,227 5.96 12,780 760 5.95
-------- ------- -------- -------
Total interest bearing
deposits................. 428,179 21,949 5.13 329,104 17,253 5.24
-------- ------- -------- -------
Federal funds purchased,
repurchase agreements and
other short-term
borrowings................... 52,855 2,624 4.96 52,702 2,895 5.49
Other borrowings............... 39,403 2,694 6.84 16,658 1,318 7.91
-------- ------- -------- -------
Total interest bearing
liabilities.............. 520,437 27,267 5.24 398,464 21,466 5.39
-------- ------- -------- -------
Non-interest bearing
liabilities and equity:
Demand deposits................ 47,560 36,966
Other liabilities.............. 6,298 2,307
Shareholders' equity........... 44,721 25,292
-------- --------
Total liabilities and
shareholders' equity..... $619,016 $463,029
======== ========
Net interest income............ $21,951 $16,299
======= =======
Net interest spread............ 3.33% 3.20%
Net interest margin............ 3.82% 3.71%

<FN>
- --------
<F1> Average balances include non-accrual loans.
<F2> Presented at actual yield rather than tax-equivalent yield.
</TABLE>

<PAGE>
The following table sets forth for the periods indicated, the
changes in interest income and interest expense which were
attributable to changes in average volume and changes in average
rates.

<TABLE>
RATE/VOLUME ANALYSIS

<CAPTION>
YEAR ENDED DECEMBER 31, 1998
COMPARED TO THE
YEAR ENDED DECEMBER 31, 1997
------------------------------------
VOLUME RATE NET CHANGE
------- ----- ----------
(IN THOUSANDS)
<S> <C> <C> <C>
INTEREST EARNED ON:
Loans................................................... $11,533 $(595) $10,938
Taxable investment securities........................... 340 (27) 313
Non-taxable investment securities....................... 17 -- 17
Federal funds sold and other investments................ 24 161 185
------- ----- -------
Total interest income............................... 11,914 (461) 11,453
------- ----- -------
INTEREST PAID ON:
Money market and NOW accounts........................... 1,298 (169) 1,129
Savings deposits........................................ 180 (34) 146
Certificates of deposit................................. 3,539 (97) 3,442
Certificates of deposit over $100,000................... (488) -- (488)
IRA certificates........................................ 465 2 467
Federal funds purchased, repurchase agreements and other
short-term borrowings................................. 8 (279) (271)
Other borrowings........................................ 1,577 (201) 1,376
------- ----- -------
Total interest expense.............................. 6,579 (778) 5,801
------- ----- -------
Net interest income................................. $ 5,335 $ 317 $ 5,652
======= ===== =======
</TABLE>

Other Income. Other income increased 182.72% totaling $9.32
million in 1998 compared to $3.30 million in 1997. Included in other
income in 1998 were $3.55 million of non-recurring gains,
specifically: $2.37 million from the sale of branches; $1.11 million
from the sale of mortgage loans; and $0.07 million from securities
transactions. Eliminating all one-time or discretionary gains, 1998
other income was $5.77 million compared to $3.27 million in 1997.
The increase in 1998 was due to substantial growth in mortgage
banking revenues, leasing revenues, deposit service charges and
brokerage revenues. Other income, excluding non-recurring gains, has
increased at a compound growth rate of 82.93% over the last five
years.

In December 1998, we completed the sale of three branch offices of
the bank located outside the St. Louis metropolitan area in order to
focus on, and expand our market share in, our market area. This sale
generated a reduction in loans of $13.52 million, a reduction in deposits
of $39.99 million and a pre-tax gain of $2.37 million.

Also during the year, we completed two significant sales of a
large portion of our one- to four-family adjustable rate mortgage
loans. These sales generated a pre-tax gain of $1.11 million. While
we previously had sold some of our mortgage loans, the 1998 bulk
sales reflect a shift in our strategy from originating and holding
mortgage loans to increasing our lending emphasis on more profitable
commercial loan relationships. During 1998, we also hired several
experienced commercial loan officers in order to implement our
strategy.

Mortgage banking revenues increased 76.85% in 1998 to $2.30
million. This compares to $1.30 million in 1997. The increase was
attributable to a continued favorable economic environment of low
unemployment and stable, low long-term interest rates. We benefited
from these macro economic trends as well as a larger customer base.

<PAGE>
Leasing revenues totaled $1.53 million, an increase of 252.66%
compared to 1997's level of $0.44 million. We entered the retail
leasing business during 1997 and the 1998 results reflect a full
year of business operation compared to a partial year in 1997.
During the latter part of 1998, a decision was made to curtail this
line of business because of declining profit margins.

Service charges on deposit accounts increased 51.92% to $1.39
million in 1998 compared to $0.91 million in 1997. The increase in
1998 was due to a larger customer base generating an increased
number of transaction deposits as well as the benefit of a full year
of the bank's revised fee structure.

Brokerage revenues increased 84.62% to $0.31 million compared to
$0.17 million in 1997. Part of this increase reflects a full year of
operation in 1998 compared to nine months of operation in 1997 and
higher transaction volumes.

Other Expenses. Total other expenses increased 62.94%, or $8.23
million, during 1998, totaling $21.30 million compared to $13.07
million in 1997. Operating expenses have increased at a 52.93% five
year annual compound growth rate. Our efficiency ratio for 1998 was
68.09%, up slightly from 66.69% in 1997. The increase in this ratio
was the result of acquisitions, deposit purchases, start-up costs
associated with new lines of business and costs resulting from
additional banking locations.

Salaries and employee benefits showed the largest dollar
increase year to year, increasing $3.47 million to $9.66 million
compared to $6.19 million in 1997. The percentage increase for 1998
was 56.06%. The increase in 1998 was due to additional staffing
resulting from acquisitions and new locations. Also included in this
caption was a payout related to a phantom stock plan for our
president. Amounts expensed under this plan, which has expired, were
$0.05 million in 1998 and $0.23 million in 1997. Average full-time
equivalent employees for 1998 were 237 compared to 146 in 1997, a
62.33% increase. At December 31, 1998 we had 215 full-time
equivalent employees compared to 209 at year-end 1997.

Furniture and equipment expenses increased $0.81 million to
$1.75 million in 1998. The increase in 1998 was the result of
acquisitions in 1997 and branch openings in 1998 and 1997.
Additionally, investments in computer resources in both years also
contributed to the large increase. Occupancy expenses totaled $1.52
million, an increase of $0.79 million, or 106.37%, during 1998. The
increase was attributable to acquisitions and branch openings, as
mentioned above. Depreciation of the assets held for operating
leases increased $0.95 million in 1998 compared to 1997. As
previously discussed, the retail leasing business was started in
late 1997 so that 1998 reflects a full year of operations.

Expense for the amortization of goodwill increased 154.19%
during 1998 or $0.55 million, totaling $0.91 million compared to
$0.39 million in 1997. This increase was the result of acquisitions
and deposit purchases undertaken during 1997 and reflected a full
year of amortization during 1998.

In 1998, operating losses totaled $0.72 million, as compared to
$0.94 million in 1997. Of the amount in 1997, $0.75 million was
considered systemic and non-recurring due to integration of two
branch acquisitions and difficulties associated with upgrading our
computer systems to an entirely new operating system. Excluding
non-recurring items in 1997, the increase in operating losses in
1998 was $0.53 million. The 1998 operating losses relate to
inconsistent operating procedures as a result of expanding the
number of branches and number of employees. Throughout 1998, we
reengineered several operational processes in an effort to improve
quality and control. Additionally, training was a focus for 1998 and
we believe that these types of losses will be substantially reduced
in 1999.

Other non-interest expense increased $1.82 million in 1998
compared to 1997. This growth in expenses was associated with
increases in the number of employees, deposit and loan accounts and
physical locations as compared to prior years.

<PAGE>
The following table sets forth a summary of our other income and
expense for the years indicated:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
------------------------
1998 1997
------- -------
(IN THOUSANDS)
<S> <C> <C>
OTHER INCOME:
Gain on sale of branches............................ $ 2,370 $ --
Mortgage banking revenues........................... 2,299 1,300
Leasing revenues.................................... 1,527 433
Service charges on deposits......................... 1,387 913
Gain on sale of mortgage loans...................... 1,112 27
Brokerage division revenues......................... 312 169
Gain on the sale of securities...................... 68 2
Other non-interest income........................... 249 454
------- -------
Total other income.............................. $ 9,324 $ 3,298
======= =======

OTHER EXPENSES:
Salaries and employee benefits...................... $ 9,663 $ 6,192
Furniture and equipment............................. 1,752 943
Occupancy........................................... 1,523 738
Depreciation of operating leases.................... 1,340 394
Goodwill amortization............................... 910 358
Operating losses.................................... 722 938
Supplies............................................ 489 428
Other non-interest expense.......................... 4,896 3,078
------- -------
Total other expenses............................ $21,295 $13,069
======= =======
</TABLE>

Securities Portfolio. At December 31, 1998, held-to-maturity
securities amounted to $12.04 million and securities designated as
available-for-sale totaled $42.74 million. At December 31, 1998, the
securities portfolio totaled $54.78 million, a decline of 28.74%
from the preceding year. The decline in the securities portfolio
occurred in the fourth quarter of 1998, as maturities were not
rolled over in order to fund the previously mentioned branch sales.
While average balances for 1998 were higher than 1997, the relative
percentage of securities to earning assets declined to 12.46% in
1998 compared to 14.91% in 1997. This decline reflected management's
decision to allow maturing securities to be reinvested in higher
yielding commercial loans.

The carrying values of the securities portfolio at the dates
indicated were as follows:

<TABLE>
SECURITIES PORTFOLIO

<CAPTION>
DECEMBER 31,
---------------------
1998 1997
------- -------
(IN THOUSANDS)
<S> <C> <C>
U.S. governmental and agency securities........... $37,021 $48,354
Mortgage-backed securities........................ 11,930 18,548
Federal Home Loan Bank stock...................... 3,574 7,033
State and municipal securities.................... 1,464 1,563
Other securities.................................. 791 1,371
------- -------
Total securities................................ $54,780 $76,869
======= =======
</TABLE>

<PAGE>
Maturities and yield information of the securities
portfolio as of December 31, 1998 were as follows:

<TABLE>
SECURITIES PORTFOLIO--MATURITIES AND YIELDS<F1>

<CAPTION>
OVER FIVE
WEIGHTED OVER ONE WEIGHTED THROUGH WEIGHTED WEIGHTED
ONE YEAR AVERAGE THROUGH AVERAGE TEN AVERAGE OVER TEN AVERAGE
OR LESS YIELD FIVE YEARS YIELD YEARS YIELD YEARS YIELD
-------- -------- ---------- -------- --------- -------- -------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. governmental and
agency securities........ $24,549 5.89% $12,472 5.94% $ -- --% $ -- --%
Mortgage-backed
securities............... 6,579 6.42 5,294 5.86 57 9.68
Federal Home Loan Bank
stock.................... 3,574 6.55 -- -- -- -- -- --
States and municipal
securities............... 324 4.87 281 5.08 859 4.87 -- --
Other securities........... -- -- 791 6.21 -- -- -- --
------- ------- ---- -------
Total securities....... $35,026 6.05% $18,838 5.91% $916 5.17% $ -- --
======= ======= ==== =======
Total securities
portfolio............ $54,780 5.99%
=======

Loans. Loans have historically been the primary component of
earning assets. At December 31, 1998 loans totaled $495.67 million,
an increase of 2.23% from year-end 1997. This small increase
included the sale of $77.96 million of mortgage loans. Without this
sale, year-end 1998 loans would have increased 18.31% compared to
year-end 1997. Average loans increased 35.01% during 1998 compared
to a 57.38% increase in 1997. Loans have increased at a 48.01%
compound average growth rate over the last five years. Substantially
all of these loans were originated in our primary market areas. At
December 31, 1998, we had no foreign loans and only a minimal amount
of participations purchased.

The largest increase in loans involved commercial real estate
loans, which increased $61.09 million, or 45.10%, in 1998.
Traditional commercial loans showed the second largest increase of
$16.30 million, or 14.83%. Growth in both of these categories
reflected management's decision to focus on the more profitable
commercial relationships instead of emphasizing one- to four-family
mortgage loans. The growth in the commercial sectors was
accomplished by hiring several additional commercial lending
personnel and directing existing staff toward developing commercial
banking relationships. As a result of this emphasis, commercial real
estate loans comprised 39.65% of the loan portfolio at December 31,
1998 compared to 27.94% at December 31, 1997. Traditional commercial
loans comprised 25.47% of the portfolio at December 31, 1998 versus
22.67% in 1997. Additionally, construction loans, which can be
viewed as commercially oriented, increased 34.62%, totaling $36.59
million at year-end 1998 compared to $27.18 million at year-end
1997. Finally, consumer loans increased $4.09 million, or 24.30%,
during 1998, reaching $20.91 million at December 31, 1998 compared
to $16.82 million at December 31, 1997.

Offsetting the substantial loan growth mentioned above was the
decline in one- to four-family residential loans. This category of
loans declined $79.67 million during 1998. This decline was
accomplished by the bulk sale of loans mentioned before as well as
normal pay-offs and amortization. This category represented 23.46%
of total loans at year-end 1998 compared to 40.42% of total loans at
year-end 1997.

<PAGE>
The following table summarizes the composition of our loan
portfolio at the dates indicated:

<TABLE>
LOAN PORTFOLIO--TYPES OF LOANS

<CAPTION>
DECEMBER 31,
--------------------------------------------------------------------------
1998 1997 1996 1995
------------------ ------------------ ------------------ --------
PERCENT PERCENT PERCENT
OF OF OF
AMOUNT TOTAL AMOUNT TOTAL AMOUNT TOTAL AMOUNT
-------- ------- -------- ------- -------- ------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Commercial, financial,
agricultural, municipal
and industrial
development............... $126,239 25.47% $109,937 22.67% $ 75,129 25.74% $ 40,518
Real estate--construction... 36,590 7.38 27,181 5.61 8,763 3.00 8,777
Real estate--mortgage
One- to four-family
residential........... 116,291 23.46 195,964 40.42 121,386 41.58 71,260
Multi-family and
commercial............ 196,545 39.65 135,452 27.94 74,721 25.60 52,795
Consumer and other, net of
unearned income........... 20,004 4.04 16,328 3.36 11,927 4.08 8,194
-------- ------ -------- ------ -------- ------ --------
Total loans......... $495,669 100.00% $484,862 100.00% $291,926 100.00% $181,544
======== ====== ======== ====== ======== ====== ========

<CAPTION>
DECEMBER 31,
-----------------------------
1995 1994
------- ------------------
PERCENT PERCENT
OF OF
TOTAL AMOUNT TOTAL
------- -------- -------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Commercial, financial,
agricultural, municipal
and industrial
development............... 22.32% $ 28,212 23.24%
Real estate--construction... 4.83 5,504 4.53
Real estate--mortgage
One- to four-family
residential........... 39.25 47,109 38.81
Multi-family and
commercial............ 29.08 31,813 26.21
Consumer and other, net of
unearned income........... 4.52 8,755 7.21
------ -------- ------
Total loans......... 100.00% $121,393 100.00%
====== ======== ======
</TABLE>

<TABLE>
LOAN PORTFOLIO--MATURITIES AND SENSITIVITIES OF LOANS

<CAPTION>
DECEMBER 31, 1998
------------------------------------------------------------------------------------------
MATURING AFTER ONE YEAR MATURING AFTER
MATURING IN THROUGH FIVE YEARS FIVE YEARS
ONE YEAR ------------------------- -------------------------
OR LESS FIXED-RATE VARIABLE FIXED-RATE VARIABLE TOTAL
----------- ---------- -------- ---------- -------- --------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
Commercial, financial,
agricultural, municipal and
industrial development...... $ 99,942 $ 24,180 $ 500 $ 1,617 $ -- $126,239
Real estate--construction..... 33,661 2,222 -- 707 -- 36,590
Real estate--mortgage
One- to four-family
residential............. 81,815 29,313 28 5,135 -- 116,291
Multi-family and
commercial.............. 92,411 98,141 1,556 4,437 -- 196,545
Consumer and other, net of
unearned income............. 10,966 8,870 -- 168 -- 20,004
-------- -------- ------ ------- ------- --------
Total loans............... $318,795 $162,726 $2,084 $12,064 $ -- $495,669
======== ======== ====== ======= ======= ========
</TABLE>

Asset Quality. Non-performing assets, consisting of loans past
due 90 days or greater, non-accrual loans, restructured loans and
other real estate owned increased slightly to $1.78 million at
December 31, 1998 compared to $1.71 million at December 31, 1997. At
December 31, 1998 non-performing assets represented 0.30% of total
assets compared to 0.28% of total assets at December 31, 1997.
Non-accrual loans were $1.50 million at December 31, 1998 compared
to $0.56 million at December 31, 1997. This increase was offset by
declines in loans delinquent 90 days or more, reflecting migration
to non-accrual status, and by the elimination of other real estate
owned.

At December 31, 1998, the bank had one loan relationship, not
included in the past-due, restructured or non-accrual categories,
where known information about possible credit problems caused
management to be uncertain as to the ability of the borrower to
comply with the present loan repayment terms over the next six
months. This loan relationship totaled $2.51 million at December 31,
1998. Principal and interest payments were current at December 31,
1998.

<PAGE>
The following table summarizes, at the dates presented,
non-performing assets by category:

<TABLE>
RISK ELEMENTS--NONACCRUAL, PAST DUE AND RESTRUCTURED LOANS

<CAPTION>
DECEMBER 31,
----------------------------------------------------------
1998 1997 1996 1995 1994
------ ------ ------ ------ ------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
COMMERCIAL, FINANCIAL, AGRICULTURAL, MUNICIPAL AND
INDUSTRIAL DEVELOPMENT:
Past due 90 days or more............................ $ -- $ 341 $ 5 $113 $ --
Non-accrual......................................... 962 360 207 109 40
Restructured terms.................................. -- -- -- -- --
REAL ESTATE--CONSTRUCTION:
Past due 90 days or more............................ -- -- 264 36 90
Non-accrual......................................... -- 108 84 20 35
Restructured terms.................................. -- -- -- 3 --
REAL ESTATE--MORTGAGE:
One- to four-family residential:
Past due 90 days or more............................ 69 456 -- -- --
Non-accrual......................................... 378 70 -- -- --
Restructured terms.................................. -- -- -- -- --
Multi-family and commercial:
Past due 90 days or more............................ -- -- -- -- --
Non-accrual......................................... 307 -- -- -- --
Restructured terms.................................. -- -- -- -- --
CONSUMER AND OTHER, NET OF UNEARNED INCOME:
Past due 90 days or more............................ -- 21 23 12 8
Non-accrual......................................... 62 21 109 15 --
Restructured terms.................................. -- -- -- -- --
------ ------ ---- ---- ----
Total non-performing loans.............................. 1,778 1,377 692 308 173
------ ------ ---- ---- ----
Other real estate....................................... -- 330 -- 10 25
------ ------ ---- ---- ----
Total non-performing assets............................. $1,778 $1,707 $692 $318 $198
====== ====== ==== ==== ====
RATIOS:
Non-performing loans to total loans................. 0.36% 0.28% 0.24% 0.17% 0.14%
Non-performing assets to total assets............... 0.30 0.28 0.18 0.11 0.12
Non-performing loans to shareholders' equity........ 3.70 3.27 4.22 2.21 2.05
Allowance for loan losses to total loans............ 1.30 1.07 1.06 1.17 1.20
Allowance for loan losses to non-performing loans... 362.32 377.12 447.98 691.56 841.04
</TABLE>

Allowance for Loan Losses. Our allowance for loan losses
increased 24.05% from $5.19 million on December 31, 1997 to $6.44
million on December 31, 1998. The provision charged to expense was
$2.42 million in 1998. This level, coupled with the bulk sale of
loans previously mentioned, allowed the level of the allowance to
increase to 1.30% of total loans at December 31, 1998 compared to
1.07% at December 31, 1997. As mentioned above in the loan
discussion, we shifted our lending focus in 1998 to higher yielding
commercial relationships. This shift, while providing higher
earnings potential, does entail greater risk than traditional
residential mortgage loans. Because of this shift, the overall level
of the allowance for loan losses was increased. Additionally, as can
be seen from the allocation of the allowance, additional weight was
given to the increased risks associated with the commercial real
estate portfolio that was reflected in the real estate--mortgage
category. Net charge-offs for 1998 were 24 basis points of average
loans outstanding. Although up from 1997's level of 19 basis points,
net charge-offs in 1998 were low and consistent with our
historically low charge-off ratio. At year-end 1998, our allowance
represented 362.32% of non-performing loans compared to 377.12% at
year-end 1997.

<PAGE>
The following table summarizes the allocation of the allowance
for loan losses by major category and identifies the percentage of
each loan category to the total loan portfolio balance:

<TABLE>
ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES

<CAPTION>
DECEMBER 31,
------------------------------------------------------------------------------
1998 1997 1996 1995
------------------- ------------------- ------------------- ---------
PERCENT PERCENT PERCENT
ALLOCATED OF ALLOCATED OF ALLOCATED OF ALLOCATED
ALLOWANCE LOANS ALLOWANCE LOANS ALLOWANCE LOANS ALLOWANCE
--------- ------- --------- ------- --------- ------- ---------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Commercial, financial,
agricultural, municipal and
industrial development........ $1,327 25.47% $1,352 22.67% $ 833 25.74% $ 467
Real estate--construction...... 347 7.38 303 5.61 124 3.00 281
Real estate--mortgage
One- to four-family
residential................. 1,222 23.46 636 40.42 439 41.58 305
Multi-family and
commercial.................. 2,849 39.65 1,572 27,94 714 25.60 513
Consumer and other............. 196 4.04 179 3.36 142 4.08 90
Unallocated.................... 501 -- 1,151 -- 848 -- 474
------ ------ ------ ------ ------ ------ ------
Total...................... $6,442 100.00% $5,193 100.00% $3,100 100.00% $2,130
====== ====== ====== ====== ====== ====== ======

<CAPTION>
DECEMBER 31,
------------------------------
1995 1994
------- -------------------
PERCENT PERCENT
OF ALLOCATED OF
LOANS ALLOWANCE LOANS
------- --------- -------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Commercial, financial,
agricultural, municipal and
industrial development........ 22.32% $ 315 23.24%
Real estate--construction...... 4.83 74 4.53
Real estate--mortgage
One- to four-family
residential................. 39.25 128 38.81
Multi-family and
commercial.................. 29.08 343 26.21
Consumer and other............. 4.52 93 7.21
Unallocated.................... -- 502 --
------ ------ ------
Total...................... 100.00% $1,455 100.00%
====== ====== ======
</TABLE>

The following table summarizes, for the periods indicated,
activity in the allowance for loan losses, including amounts of
loans charged off, amounts of recoveries and additions to the
allowance charged to operating expenses:

<PAGE>
<TABLE>
SUMMARY OF LOAN LOSS EXPERIENCE AND RELATED INFORMATION

<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
ALLOWANCE FOR LOAN LOSSES (BEGINNING OF YEAR).......... $ 5,193 $ 3,100 $ 2,130 $ 1,455 $ 775
Loans charged off:
Commercial, financial, agricultural, municipal and
industrial development........................... (632) (536) (113) (183) (165)
Real estate--construction.......................... (7) (22) (252) (82) --
Real estate--mortgage
One- to four-family residential................ (307) (88) (37) -- (31)
Multi-family and commercial.................... (133) -- (75) -- --
Consumer and other................................. (147) (113) (68) (58) (10)
-------- -------- -------- -------- --------
Total loans charged off................................ (1,226) (759) (545) (323) (206)
-------- -------- -------- -------- --------
Recoveries of loans previously charged off:
Commercial, financial, agricultural, municipal and
industrial development........................... 4 12 54 11 35
Real estate--construction.......................... 6 -- -- -- --
Real estate--mortgage
One- to four-family residential................ 14 10 3 -- --
Multi-family and commercial.................... 20 -- -- -- --
Consumer and other................................. 11 30 10 10 2
-------- -------- -------- -------- --------
Total recoveries....................................... 55 52 67 21 37
-------- -------- -------- -------- --------
Net loans charged off.................................. (1,171) (707) (478) (302) (169)
-------- -------- -------- -------- --------
Acquired subsidiary balance............................ -- 403 -- -- --
Provision for loan losses.............................. 2,420 2,397 1,448 977 849
-------- -------- -------- -------- --------
Allowance for loan losses (end of year)................ $ 6,442 $ 5,193 $ 3,100 $ 2,130 $ 1,455
======== ======== ======== ======== ========
LOANS OUTSTANDING:
Average........................................ $493,619 $365,615 $232,314 $158,503 $ 88,654
End of year.................................... 495,669 484,862 291,926 181,544 121,393
RATIOS:
Net charge-offs to average loans............... 0.24% 0.19% 0.21% 0.19% 0.19%
Net charge-offs to provision for loan losses... 48.39 29.50 33.01 30.91 19.91
Provision for loan losses to average loans..... 0.49 0.66 0.62 0.62 0.96
Allowance for loan losses to total loans....... 1.30 1.07 1.06 1.17 1.20
</TABLE>

<PAGE>
Deposits. Total deposits declined $33.88 million, or 6.99%, in
1998 compared to 1997. As previously mentioned, this decline in
year-end numbers was the result of the sale of three branch offices
of the bank. This sale reduced total deposits at December 31, 1998
by $39.99 million. The majority of deposits sold were in the
certificate of deposit category, hence the decline in certificates
of deposit as a percent of total deposits to 41.55% at December 31,
1998 from 47.79% at December 31, 1997. Absent the sale, deposits
would have increased slightly during 1998.

Average deposits for 1998 were $475.74 million compared to
$366.07 million in 1997. The increase in average deposits was the
result of acquisitions and deposit purchases that occurred during
the third quarter of 1997. The effect of these 1997 acquisitions
increased averages for the full year of 1998. Changes in the mix of
average deposits were concentrated in both categories of
certificates of deposit. On average, retail certificates of deposit
increased as a percentage of total deposits to 47.22% in 1998 from
44.49% in 1997. Certificates of deposit over $100,000 declined to
8.32% of total deposits in 1998 from 13.21% of total deposits in
1997. The reduction in large certificates of deposit was the result
of management's efforts to replace these rate sensitive funds with
core deposits.

The following tables summarize deposits as of the dates
indicated:

<TABLE>
DEPOSIT LIABILITY COMPOSITION

<CAPTION>
DECEMBER 31,
------------------------------------------------------------------
1998 1997
------------------------------- -------------------------------
PERCENT AVG. PERCENT AVG.
AMOUNT OF TOTAL RATE AMOUNT OF TOTAL RATE
-------- -------- ---- -------- -------- ----
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
Demand deposits.................................. $ 55,417 12.29% --% $ 50,060 10.33% --%
Money market and NOW accounts.................... 142,902 31.70 4.12 115,856 23.91 4.29
Savings deposits................................. 14,917 3.31 2.57 16,157 3.33 2.89
Certificates of deposit.......................... 187,886 41.68 5.73 231,601 47.79 5.79
Certificates of deposit over $100,000............ 31,173 6.92 5.55 52,211 10.77 5.55
IRA certificates................................. 18,471 4.10 5.96 18,756 3.87 5.95
-------- ------ -------- ------
Total deposits............................... $450,766 100.00% 5.13 $484,641 100.00% 5.24
======== ====== ======== ======
</TABLE>

<TABLE>
AMOUNTS AND MATURITIES OF TIME DEPOSITS OF $100,000 OR MORE

<CAPTION>
DECEMBER 31, 1998
-----------------
<S> <C>
(IN THOUSANDS)
Three months or less................................ $14,387
Over three months through six months................ 5,658
Over six through twelve months...................... 5,905
Over twelve months.................................. 5,223
-------
Total........................................... $31,173
=======
</TABLE>

<PAGE>
COMPARISON OF THE YEARS ENDED DECEMBER 31, 1997 AND 1996. We
reported then-record earnings for 1997 with consolidated net income
of $2.42 million, an increase of 33.70% over 1996 earnings of $1.81
million. Basic earnings per share were $0.65 compared to $0.66 in
1996. Diluted earnings per share were $0.49, a 2.08% increase over
the $0.48 earned in 1996. Average shares outstanding increased
substantially in 1997 as we continued to increase our equity base to
keep pace with asset growth.

Return on average assets for 1997 was 0.52%, compared to 0.59%
in 1996. Return on average shareholders' equity was 9.55% for the
year compared to 12.17% for 1996. The decline in the return on
average shareholders' equity was attributable to our issuance of
shares of common stock in connection with the acquisition of
Reliance Financial, Inc. in August 1997 and two rights offerings
during 1997.

Net Interest Income. Net interest income increased $6.24
million, or 62.07%, in 1997 compared to an increase of 24.99% in
1996. Net interest margin was 3.71% in 1997 compared to 3.39% in
1996. The increase in net interest income and net interest margin
was due to a relatively stable rate environment, significant
increases in loans and deposits, substantial shifting of earning
assets into higher yielding loans and proportionately greater
non-interest bearing deposits. These improvement factors were
partially offset by a decrease in the ratio of earning assets to
total assets.

Our net interest spread increased by 30 basis points from 2.92%
in 1996 to 3.22% in 1997. This followed a decrease of 30 basis
points in 1996. The increase in 1997 occurred as a result of an
increase on the yields on earning assets of 14 basis points and a 14
basis point decline in rates paid on interest bearing liabilities.
The increase of the yields on earning assets of 14 basis points
followed a decrease of 42 basis points in 1996. The increase in 1997
was due in large part to average loans comprising 83.17% of earning
assets. Despite a 6 basis point decline in loan yields, the
increased volume of loans helped raise overall yield on earning
assets. Yields on taxable securities also improved 35 basis points
as a result of reinvestment opportunities and the additional
investment opportunities and the additional investment of $5.0
million resulting from cash received in the third quarter from the
acquisition of the branches in Union and Warrenton, Missouri. The
lower rates paid on interest bearing liabilities was the result of
generally lower rates in all categories with the exception of
certificates of deposit over $100,000. The decline in rates on
certificates of deposits under $100,000 of 11 basis points had the
most impact.

<PAGE>
The following table sets forth the condensed average balance
sheets for the periods reported. Also shown is the average yield on
each category of interest earning assets and the average rate paid
on interest-bearing liabilities for each of the periods reported.

<TABLE>
DISTRIBUTION OF AVERAGE ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY
AND INTEREST RATES

<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------------------------------------------------------
1997 1996
-------------------------------------- --------------------------------------
AVERAGE INTEREST AVERAGE AVERAGE INTEREST AVERAGE
BALANCE EARNED/PAID YIELD/RATE BALANCE EARNED/PAID YIELD/RATE
-------- ----------- ---------- -------- ----------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Interest-earning assets:
Loans<F1>.............................. $365,615 $33,473 9.16% $232,314 $21,428 9.22%
Taxable investment securities.......... 64,384 3,910 6.07 59,882 3,428 5.72
Non-taxable investment
securities<F2>....................... 1,130 56 4.96 1,115 49 4.39
Federal funds sold and other
investments.......................... 8,492 326 3.84 3,079 151 4.90
-------- ------- ---- -------- ------- ----
Total interest earning assets...... 439,621 37,765 8.59 296,390 25,056 8.45
Non-interest earning assets:
Cash and due from banks................ $ 9,341 $ 6,382
Bank premises and equipment............ 6,869 4,698
Other assets........................... 11,065 3,915
Allowance for loan losses.............. (3,867) (2,401)
-------- --------
Total assets....................... $463,029 $308,984
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Interest bearing liabilities:
Money market and NOW accounts.......... $ 95,431 4,092 4.29% $ 70,948 3,218 4.54%
Savings deposits....................... 9,665 279 2.89 6,985 227 3.25
Certificates of deposit................ 162,870 9,436 5.79 104,283 6,149 5.90
Certificates of deposit over
$100,000............................. 48,358 2,686 5.55 36,387 2,001 5.50
IRA certificates....................... 12,780 760 5.95 7,673 465 6.06
-------- ------- -------- -------
Total interest bearing deposits.... 329,104 17,253 5.24 226,276 12,060 5.33
-------- ------- -------- -------
Federal funds purchased, repurchase
agreements and other short-term
borrowings........................... 52,702 2,895 5.49 27,481 1,542 5.61
Other borrowings....................... 16,658 1,318 7.91 17,482 1,397 7.99
-------- ------- -------- -------
Total interest bearing
liabilities...................... $398,464 $21,466 5.39 $271,239 $14,999 5.53
-------- ------- -------- -------
Non-interest bearing liabilities and
equity:
Demand deposits........................ $ 36,966 $ 21,312
Other liabilities...................... 2,307 1,582
Shareholders' equity................... 25,292 14,851
-------- --------
Total liabilities and shareholders'
equity........................... $463,029 $308,984
======== ========
Net interest income................ $16,299 $10,057
======= =======
Net interest spread................ 3.20% 2.92%
Net interest margin................ 3.71% 3.39%

<FN>
- --------
<F1> Average balances include non-accrual loans.
<F2> Presented at actual yield rather than tax-equivalent yield.
</TABLE>

<PAGE>
The following table sets forth for the periods indicated, the
changes in interest income and interest expense which were
attributable to changes in average volume and changes in average
rates.

<TABLE>
RATE/VOLUME ANALYSIS

<CAPTION>
YEAR ENDED DECEMBER 31, 1997
COMPARED TO THE
YEAR ENDED DECEMBER 31, 1996
------------------------------------
VOLUME RATE NET CHANGE
------- ----- ----------
(IN THOUSANDS)
<S> <C> <C> <C>
INTEREST EARNED ON:
Loans....................................................... $12,186 $(141) $12,045
Taxable investment securities............................... 267 216 483
Non-taxable investment securities........................... 1 6 7
Federal funds sold and other investments.................... 213 (39) 174
------- ----- -------
Total interest income................................... 12,667 42 12,709
------- ----- -------
INTEREST PAID ON:
Money market and NOW accounts............................... 1,060 (186) 874
Savings deposits............................................ 79 (27) 52
Certificates of deposit..................................... 3,404 (117) 3,287
Certificates of deposit over $100,000....................... 666 19 685
IRA certificates............................................ 303 (8) 295
Federal funds purchased, repurchase agreements and other
short-term borrowings..................................... 1,386 (33) 1,353
Other borrowings............................................ (65) (14) (79)
------- ----- -------
Total interest expense.................................. 6,833 (366) 6,467
------- ----- -------
Net interest income..................................... $ 5,834 $ 408 $ 6,242
======= ===== =======
</TABLE>

Other Income. Other income increased 136.76% for 1997 compared
to 1996, and totaled $3.30 million for 1997. Other income, excluding
securities gains and mortgage banking revenues, increased $0.96
million, or 93.41%, in 1997 compared to the prior year. The increase
in other income in 1997 resulted primarily from an increase of $0.99
million in mortgage banking gross revenues generated by Allegiant
Mortgage Company and the newly formed Edge Mortgage Services. In
addition, service charges on deposit accounts grew by $0.30 million
due to the increased number of deposit accounts and an expanded base
of service chargeable products.

Other Expenses. Total operating expenses increased $6.05
million, or 86.19%, to $13.07 million during 1997, compared to an
increase of $1.39 million, or 24.78%, to $7.02 million in 1996. A
majority of the increase was due to the expansion of our business
lines, our two mortgage subsidiaries and an increase in the number
of our banking locations. These additions resulted in increased
salary and benefit expense, furniture and equipment costs and
occupancy expenses. Our efficiency ratio, determined by dividing the
total operating expenses by the total tax-equivalent revenue, was
67.69% in 1997 as compared to 61.30% in 1996.

<PAGE>
The following table sets forth a summary of our other income and
expense for the years indicated:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------
1997 1996
-------- -------
(IN THOUSANDS)
<S> <C> <C>
OTHER INCOME:
Mortgage banking revenues........................... $ 1,300 $ 312
Leasing revenues.................................... 433 --
Service charges on deposits......................... 913 612
Gain on the sale of mortgage loans.................. 27 --
Brokerage division revenues......................... 169 6
Gain on the sale of securities...................... 2 49
Other non-interest income........................... 454 414
------- ------
Total other income.............................. $ 3,298 $1,393
======= ======

OTHER EXPENSES:
Salaries and employee benefits...................... $ 6,192 $3,455
Furniture and equipment............................. 943 689
Occupancy........................................... 738 448
Depreciation of operating leases.................... 394 --
Goodwill amortization............................... 358 67
Operating losses.................................... 938 144
Supplies............................................ 428 202
Other non-interest expense.......................... 3,078 2,014
------- ------
Total other expenses............................ $13,069 $7,019
======= ======
</TABLE>

Securities Portfolios. At December 31, 1997, held-to-maturity
securities amounted to $31.95 million and securities designated as
available-for-sale totaled $44.92 million.

The carrying value of securities portfolio at the dates indicated
were as follows:

<TABLE>
SECURITIES PORTFOLIO

<CAPTION>
DECEMBER 31,
-----------------------
1997 1996
------- -------
(IN THOUSANDS)
<S> <C> <C>
U.S. governmental and agency securities........... $48,354 $36,492
Mortgage-backed securities........................ 18,548 18,202
Federal Home Loan Bank stock...................... 7,033 4,462
State and municipal securities.................... 1,563 1,199
Other securities.................................. 1,371 205
------- -------
Total securities................................ $76,869 $60,560
======= =======
</TABLE>

Loans. Loans, the largest component of interest earning assets,
increased 66.09% for the year ended December 31, 1997 which followed
an increase of 60.80% in 1996. Average total loans outstanding for
1997 were $365.62 million, a 57.38% increase over 1996 average
outstandings. Average total loans outstanding for 1996 were $232.31
million, an increase of 46.57% over average total outstanding loans
in 1995. The loan growth in 1997 consisted of a 46.33% increase in
commercial loans, a 69.00% increase in real estate mortgage loans, a
210.18% increase in real estate construction loans and a 39.20%
increase in consumer loans. Essentially all of the loans were
generated within our primary market area. We had no foreign credits
and an insignificant amount of participations were purchased.

<PAGE>
Commercial loans increased $34.81 million, from $75.13 million
on December 31, 1996 to $109.94 million on December 31, 1997. The
increase in commercial loans was largely due to marketing efforts of
the bank's commercial loan team, strengthened by the additions
during 1997 of experienced personnel. The commercial loan portfolio
is diversified from an industry standpoint and includes businesses
engaged in manufacturing, agribusiness, wholesaling and retailing,
financial services and other service businesses. Emphasis is upon
middle market and community businesses with known management and
financial stability. Consistent with the bank's strategy and
emphasis upon relationship banking, most borrowing customers also
maintain deposit accounts and utilize other banking services. Real
estate is often a material component of collateral for the
commercial and industrial loans even though repayment on the loans
may not be directly related to the real estate. This real estate
provides us with additional collateral protection.

Asset Quality. Our allowance for loan losses increased 67.52%,
from $3.10 million on December 31, 1996, to $5.19 million on
December 31, 1997. The majority of this increase was due to the
provision of $2.40 million to the allowance for loan losses during
1997. The 67.52% increase in the allowance was directly related to
the 66.09% increase during 1997 in our loan balance. The allowance
for loan losses to total loans increased slightly to 1.07% at
December 1997 from 1.06% at December 31, 1996. The allowance for
loan losses represented 377.12% of non-performing loans at
December 31, 1997, compared to 447.98% at December 31, 1996.

Non-performing assets increased by $1.02 million to $1.71
million at December 31, 1997, from $0.69 million on December 31,
1996. The ratio of non-performing loans to total loans was 0.28% at
December 31, 1997 compared to 0.24% as of December 31, 1996. The
increase in non-performing assets included an increase of $0.46
million in past due one- to four-family real estate loans, an
increase of $0.34 million in past due commercial loans and an
increase of $0.33 million in other real estate owned.

Allowance for Loan Losses. The allowance for loan losses equaled
1.07% of loans outstanding at December 31, 1997, essentially the
same percentage level as 1996. For the year ended December 31, 1997,
the provision for loan losses was $2.40 million compared to $1.45
million for the year ended December 31, 1996, an increase of $0.95
million, or 65.54%. The increase in the annual provision for loan
losses was primarily a result of the 66.09% increase in total loans
outstanding at December 31, 1997 compared to December 31, 1996. The
provision to average loans outstanding as 0.66% in 1997 compared to
0.62% in 1996. Net loans charged off during 1997 was $0.71 million,
compared to $0.48 million for the year ended December 31, 1996
representing an increase of 47.91%. Net loans charged off as a
percentage of average loans outstanding was 0.19% and 0.21% in 1997
and 1996, respectively. Non-performing loans to total loans remained
low at 0.28% at December 31, 1997 compared to 0.24% at year-end
1996. Total recoveries for the twelve months ended December 31, 1997
were $0.05 million compared to $0.07 million in 1996.

Deposits. Average deposits increased $118.48 million, or 47.85%,
in 1997 following an increase of $63.28 million, or 34.33%, in 1996.
The increase in 1997 was due to internal growth of approximately
$67.5 million primarily from additional branch openings in 1996 and
1997 and growth of approximately $51.0 million due to acquisitions.
As shown in the table below, total deposits at year-end 1997
increased by $175.97 million, or 57.01%. This growth rate, which is
higher than the average growth rate, was due to the aforementioned
acquisitions taking place in the third quarter of 1997, which
therefore impacted average balances for the year to a lesser degree.

The mix of average deposits changed moderately during the year
with non-interest bearing deposits comprising 10.10% of total
deposits compared to 8.61% in 1996. This increase also was the
result of the previously mentioned deposit acquisition having
proportionately more non-interest bearing accounts. Certificates of
deposit under $100,000 comprised 44.49% of average deposits compared
to 42.12% in 1996. The increase in 1997 was a result of the thrift
acquisition having proportionately more of these deposits.

<PAGE>
The following tables summarize deposits as of the dates
indicated:

<TABLE>
DEPOSIT LIABILITY COMPOSITION

<CAPTION>
DECEMBER 31,
---------------------------------------------------------------------------
1997 1996
---------------------------------- ----------------------------------
PERCENT AVG. PERCENT AVG.
AMOUNT OF TOTAL RATE AMOUNT OF TOTAL RATE
-------- -------- ---- -------- -------- ----
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
Demand deposits.......................... $ 50,060 10.33% --% $ 29,406 9.53% --%
Money market and NOW accounts............ 115,856 23.91 4.29 85,201 27.60 4.54
Savings deposits......................... 16,157 3.33 2.89 6,083 1.97 3.25
Certificates of deposit.................. 231,601 47.79 5.79 128,407 41.60 5.90
Certificates of deposit over $100,000.... 52,211 10.77 5.55 50,825 16.47 5.50
IRA certificates......................... 18,756 3.87 5.95 8,748 2.83 6.06
-------- ------ -------- ------
Total deposits....................... $484,641 100.00% 5.24 $308,670 100.00% 5.33
======== ====== ======== ======
</TABLE>

<TABLE>
AMOUNTS AND MATURITIES OF TIME DEPOSITS OF $100,000 OR MORE

<CAPTION>
DECEMBER 31, 1997
-----------------
(IN THOUSANDS)
<S> <C>
Three months or less.............................. $26,694
Over three months through six months.............. 5,604
Over six through twelve months.................... 11,098
Over twelve months................................ 8,815
-------
Total........................................... $52,211
=======
</TABLE>

INTEREST RATE SENSITIVITY

Our asset/liability strategy is to minimize the sensitivity of
earnings to changes in interest rates while maintaining an
acceptable net interest margin. The bank's asset/liability committee
monitors the interest rate sensitivity of the balance sheet on a
bi-weekly basis. The committee reviews asset and liability repricing
in the context of current and possible future interest rate
scenarios affecting the economic climate in our market area.

Our pricing policy is that all earning assets and interest
bearing liabilities be either based on floating rates or have a
fixed rate for a period not exceeding five years. Real estate
mortgage loans held by us, while having long final maturities,
are comprised of one-, two- or three-year adjustable rate loans.
The adjustable basis of these loans significantly reduces interest
rate risk.

<PAGE>
The following table illustrates our estimated interest rate
sensitivity and periodic and cumulative gap positions calculated as
of March 31, 1999:

<TABLE>
<CAPTION>
TIME TO MATURITY OR REPRICING
--------------------------------------------------------------------
0 TO 3 4 TO 12 1 TO 5 OVER
MONTHS MONTHS YEARS 5 YEARS TOTAL
-------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
RATE SENSITIVE ASSETS (RSA):
Loans............................ $252,550 $ 85,590 $170,625 $ 11,541 $520,306
Investment securities............ 12,806 6,544 29,705 6,872 55,927
Federal funds.................... 4,475 -- -- -- 4,475
-------- -------- -------- -------- --------
Total RSA.................... $269,831 $ 92,134 $200,330 $ 18,413 $580,708
======== ======== ======== ======== ========
RATE SENSITIVE LIABILITIES (RSL):
Money market and NOW accounts.... $170,772 $ -- $ -- $ -- $170,772
Savings.......................... 15,031 -- -- -- 15,031
Time deposits.................... 38,559 72,269 79,746 -- 190,574
Time deposits over $100,000...... 14,336 34,291 4,406 -- 53,033
Repurchase agreements............ 9,292 247 -- -- 9,539
S/T other........................ -- 500 -- -- 500
S/T FHLB borrowings.............. 12,000 25,500 -- -- 37,500
L/T FHLB borrowings.............. -- -- 26,625 -- 26,625
L/T borrowings--other............ -- -- 13,150 -- 13,150
-------- -------- -------- -------- --------
Total RSL.................... $259,990 $132,807 $123,927 $ -- $516,724
======== ======== ======== ======== ========
PERIODIC INFORMATION:
GAP (RSA--RSL)................... $ 9,841 $(40,673) $ 76,403 $ 18,413
RSA/RSL<F1>...................... 103.79% 69.37% 161.65% N/A
RSA/total assets................. 43.49 14.85 32.29 2.97%
RSL/total assets................. 41.90 21.40 19.97 0.00
GAP/total assets................. 1.59 6.56 12.31 2.97
GAP/RSA.......................... 1.69 7.00 13.16 3.17

CUMULATIVE INFORMATION:
Cumulative RSA................... $269,831 $361,965 $562,295 $580,708
Cumulative RSL................... 259,990 392,797 516,724 516,724
GAP (RSA--RSL)................... 9,841 (30,832) 45,571 63,984
RSA/RSL.......................... 103.79% 92.15% 108.82% 112.38%
RSA/total assets................. 43.49 58.34 90.62 93.59
RSL/total assets................. 41.90 63.30 83.28 83.28
GAP/total assets................. 1.59 4.97 7.34 10.31
GAP/RSA.......................... 1.59 5,31 7.85 11.02

<FN>
- -------
<F1> Our current asset/liability policy is to maintain RSA/RSL percentage
between 80% and 135% for the 0 to 3 month maturity range and between 75%
and 125% for the cumulative one-year maturity range.
</TABLE>

<PAGE>
We measure the impact of interest rate changes on our income
statement through the use of gap analysis. The gap represents the
net position of assets and liabilities subject to repricing in
specified time periods. During any given time period, if the amount
of rate sensitive liabilities exceeds the amount of rate sensitive
assets, a company would generally be considered negatively gapped
and would benefit from falling rates over that period of time.
Conversely, a positively gapped company would generally benefit from
rising rates.

We have structured the assets and liabilities of our company to
mitigate the risk of either a rising or falling interest rate
environment. Depending upon our assessment of economic factors such
as the magnitude and direction of projected interest rates over the
short- and long-term, we generally operate within guidelines set by
our asset/liability policy and attempt to maximize our returns
within an acceptable degree of risk. Our intention is to maintain a
gap position at the one-year horizon of between 0.75% and 1.25%. Our
position at March 31, 1999 was 0.92%. We manage our gap position at
the one-year horizon as well as monitor the cumulative gap position
for succeeding time frames.

Interest rate changes do not affect all categories of assets and
liabilities equally or simultaneously. There are other factors that
are difficult to measure and predict that would influence the effect
of interest rate fluctuations on our income statement. For example,
a rapid drop in interest rates might cause our borrowers to repay their
loans at a more rapid pace and certain mortgage-related investments to
be prepaid more quickly than projected. This could mitigate some of the
benefits of falling rates as are expected when negatively gapped.
Conversely, a rapid rise in rates could give us an opportunity to
increase our margins and stifle the rate of repayment on our
mortgage-related loans which would increase our returns.

The following table shows the "rate shock" results of a
simulation model that attempts to measure the effect of rising and
falling interest rates over a two-year horizon in a rapidly changing
rate environment.

<TABLE>
<CAPTION>
+200 BASIS -200 BASIS
POINTS POINTS
---------- ----------
<S> <C> <C>
Percentage change in net income due to an
immediate 200 basis point change in interest
rates over a two-year time horizon............ +37.25% -44.11%
</TABLE>

As this table demonstrates, as of March 31, 1999 we had a
cumulative positive gap position. This table shows that if there
were an instantaneous, parallel shift in the yield curve of +200
basis points, we would realize an increase in net income of 37.25%
over a two year horizon. Conversely, a like shift of -200 basis points
would result in a decrease in net income of 44.11% over a two-year
horizon. We used a sensitivity model that simulated these interest
rate changes on our earning assets and interest-bearing liabilities.
This process allows us to explore the complex relationships among the
financial instruments in various interest rate environments.

The preceding sensitivity analysis is based on numerous
assumptions including: the nature and timing of interest rate levels
including the shape of the yield curve; prepayments on loans and
securities; changes in deposit levels; pricing decisions on loans
and deposits; reinvestment/replacement of asset and liability cash
flows; and others. While assumptions are developed based upon
current economic and local market conditions, we cannot make any
assurances as to the predictive nature of these assumptions
including how client preferences or competitor influences might
change.

Interest rate exposure is measured by the potential impact on
our income statement of possible changes in interest rates. We use
information from our gap analysis and rate shock calculations as
input to help manage our exposure to changing interest rates. During
the past year, we have managed our balance sheet in a negatively
gapped position for the one-year time frame, reflecting our outlook
that the U.S. economy and general interest rate levels will be
stable. We recognized opportunities to extend maturities on assets
to take advantage of higher interest rates at longer maturities.

We use our rate shock information to tell us how much exposure
we have to rapidly changing rates. Based on historical information
and our assessment of future interest rate trends, we do not believe
there is a substantial risk of rapidly rising rates, which would
negatively impact our income statement. Conversely,

<PAGE>
we also believe there is minimal likelihood of rapidly falling
rates, which would positively impact our income statement.

We believe that more likely scenarios include gradual changes in
interest rate levels. We continue to monitor our gap and rate shock
reports to detect changes to our exposure to fluctuating rates. We
have the ability to shorten or lengthen maturities on newly acquired
assets, sell investment securities, or seek funding sources with
different maturities in order to change our asset and liability
structure for the purpose of mitigating the effect of interest rate
risk.

As the following table shows, at December 31, 1998 we had a slight
bias for falling interest rates in the most immediate time frame. This
structure is similar to our positioning at the beginning of 1998;
however, the bias to falling rates has been reduced to mitigate the
impact of any increases in short-term rates. The cumulative gap
positions in all time frames presented are well within our
asset/liability guidelines.

<TABLE>
<CAPTION>
TIME TO MATURITY OR REPRICING
--------------------------------------------------------------------
0 TO 3 4 TO 12 1 TO 5 OVER
MONTHS MONTHS YEARS 5 YEARS TOTAL
-------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
RATE SENSITIVE ASSETS (RSA):
Loans............................ $241,108 $ 77,687 $164,810 $ 12,064 $495,669
Investment securities............ 11,857 23,169 18,838 916 54,780
Federal funds.................... 3,430 -- -- -- 3,430
-------- -------- -------- -------- --------
Total RSA.................... $256,395 $100,856 $183,648 $ 12,980 $553,879
======== ======== ======== ======== ========
RATE SENSITIVE LIABILITIES (RSL):
Money market and NOW accounts.... $142,901 $ -- $ -- $ -- $142,901
Savings.......................... 14,918 -- -- -- 14,918
Time deposits.................... 67,481 70,638 67,564 674 206,357
Time deposits over $100,000...... 15,037 11,865 3,929 342 31,173
Repurchase agreements............ 13,745 297 -- -- 14,042
S/T other........................ -- 500 -- -- 500
S/T FHLB borrowings.............. 27,000 12,500 -- -- 39,500
L/T FHLB borrowings.............. -- -- 15,125 11,500 26,625
L/T borrowings--other............ -- -- 13,150 -- 13,150
-------- -------- -------- -------- --------
Total RSL.................... $281,082 $ 95,800 $ 99,768 $ 12,516 $489,166
======== ======== ======== ======== ========
PERIODIC INFORMATION:
GAP (RSA--RSL)................... $(24,687) $ 5,056 $ 83,880 $ 464
RSA/RSL<F1>...................... 91.22% 105.28% 184,08% 103.71%
RSA/total assets................. 43.00 16.91 30.80 2.18
RSL/total assets................. 47.14 16.07 16.73 2.10
GAP/total assets................. 4.14 0.85 14.07 0.08
GAP/RSA.......................... 4.46 0.91 15.14 0.08

CUMULATIVE INFORMATION:
Cumulative RSA................... $256,395 $357,251 $540,899 $553,879
Cumulative RSL................... 281,082 376,882 476,650 489,166
GAP (RSA--RSL)................... (24,687) (19,631) 64,249 64,713
RSA/RSL.......................... 91.22% 94.79% 113.48% 113,23%
RSA/total assets................. 43.00 59.91 90.71 92.89
RSL/total assets................. 47.14 63.21 79.94 82.04
GAP/total assets................. 4.14 3.29 10.78 10.85
GAP/RSA.......................... 4.46 3.54 11.60 11.68

<PAGE>
<PAGE>
The following table provides additional information about our
financial instruments as of December 31, 1998. For loans, securities
and liabilities with contractual maturities, the table presents
principal cash flow and related weighted-average interest rates by
contractual maturities. Core deposits that have no contractual
maturity are subject to immediate withdrawal or repricing.

<TABLE>
<CAPTION>
YEAR OF CONTRACTUAL MATURITY
------------------------------------------------------------------------------------------
1999 2000 2001 2002 2003 THEREAFTER TOTAL
-------- ------- ------- ------- ------- ---------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
RATE SENSITIVE ASSETS:
Fixed rate loans............... $ 70,498 $63,377 $56,938 $25,309 $24,468 $ 6,845 $247,435
Average interest rate........ 8.07% 8.48% 8.40% 8.40% 8.29% 8.35% 8.37%
Variable rate loans............ $155,556 $31,913 $15,494 $ 8,594 $16,202 $20,475 $248,234
Average interest rate........ 8.45% 8.01% 8.24% 8.50% 7.78% 8.40% 8.33%
Fixed rate securities.......... $ 7,739 $ 6,450 $ 4,403 $ 5,223 $10,240 $ 8,629 $ 42,684
Average interest rate........ 6.11% 6.34% 6.00% 6.09% 5.62% 5.98% 5.98%
Variable rate securities....... -- $ 4,000 -- -- -- $ 8,096 $ 12,096
Average interest rate........ -- 4.85% -- -- -- 6.82% 6.17%
Federal funds sold............. $ 3,430 -- -- -- -- -- $ 3,430
Average interest rate........ 4.55% -- -- -- -- -- 4.55%
RATE SENSITIVE LIABILITIES:
Non-interest-bearing
deposits..................... $ 55,417 -- -- -- -- -- $ 55,417
Savings and interest-bearing
checking..................... 157,819 -- -- -- -- -- 157,819
Average interest rate........ 3.89% -- -- -- -- -- 3.89%
Time deposits.................. $165,021 $41,452 $18,513 $ 6,126 $ 5,402 $ 1,016 $237,530
Average interest rate........ 5.48% 5.41% 5.79% 5.96% 5.67% 6.12% 5.51%
Fixed interest rate
borrowings................... $ 17,042 $20,000 $12,650 $ 625 $ 1,500 $42,000 $ 93,817
Average interest rate........ 4.19% 5.70% 7.00% 5.87% 5.62% 5.01% 5.29%
</TABLE>

CAPITAL RESOURCES AND LIQUIDITY

LIQUIDITY MANAGEMENT. Long-term liquidity is a function of the
core deposit base and an adequate capital base. We are committed to
growth of our deposit base. This growth is both internally generated
through product pricing and product development and externally
generated through brokered certificates of deposit. During the
quarter ended March 31, 1999 and the year ended December 31, 1998,
both of these elements contributed heavily to developing and
maintaining long-term liquidity. Our capital position has been
maintained through earnings and raising capital. See "--Capital
Resources."

Short-term liquidity needs arise from continuous fluctuations in
the flow of funds on both sides of the balance sheet resulting from
growth and seasonal and cyclical customer demands. The securities
portfolio provides stable long-term earnings as well as being a
primary source of liquidity. The designation of securities as
available-for-sale and held-to-maturity does not impact the
portfolio as a source of liquidity due to the ability to enter into
repurchase agreements using those securities.

We anticipate continued loan demand in our market areas as
industry consolidation continues. We have utilized, and expect to
continue to utilize, Federal Home Loan Bank borrowings to fund a
portion of future loan growth. We had a $70.25 million secured
credit facility with the Federal Home Loan Bank as of December 31,
1998, of which $66.13 million was outstanding at December 31, 1998.
As of March 31, 1999, we had availability under our Federal Home
Loan Bank secured credit facility of $71.08 million of which $64.13
million was outstanding.

Average short-term borrowings decreased 1.74% during the first
quarter of 1999 following an increase of 0.29% in the year ended
December 31, 1998. The increases reflected the above-mentioned
strategy of utilizing Federal Home Loan Bank borrowings to fund loan
growth while continuing to systematically build our deposit base. We
anticipate similar use of the Federal Home Loan Bank facility in the
foreseeable future. In addition to the Federal Home Loan Bank credit
facility, as of March 31, 1999, we had available $29.10 million of
additional short-term borrowing capacity.

The following table summarizes short-term borrowings for the
periods indicated:

<TABLE>
AVERAGE SHORT-TERM BORROWINGS

<CAPTION>
QUARTER ENDED YEAR ENDED
MARCH 31, 1999 DECEMBER 31, 1998
--------------------- ---------------------
AVERAGE AVERAGE AVERAGE AVERAGE
BALANCE RATE AMOUNT RATE
------- ------- ------- -------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
Federal funds purchased........................ $ 4,690 5.08% $ 1,272 5.56%
Securities sold under agreement to repurchase
and other short-term borrowings.............. 47,246 4.98 51,583 4.95
------- -------
Total.......................................... $51,936 4.99 $52,855 4.96
======= =======
Total maximum short-term borrowings outstanding
at any month-end during the period........... $53,969 $63,449
</TABLE>

We experienced net growth in assets of 4.12% during the first
three months of 1999, while deposits increased 6.72% during the same
period. Total assets and liabilities were relatively unchanged in
totals from March 31, 1998 to March 31, 1999 and actually increased
subsequent to the sale of the three northeast Missouri branches in
December 1998. The branch sale resulted in a reduction of $13.52
million in loans and $39.99 million in deposits. We continue to
emphasize growth in stable core deposits while utilizing the Federal
Home Loan Bank as necessary to balance liquidity and cost
effectiveness. We closely monitor our level of liquidity to meet
expected future needs.

CAPITAL RESOURCES. Total shareholders' equity increased 2.00% to
$49.06 million at March 31, 1999 compared to $48.10 million at
year-end 1998.

Our capital requirements have been historically financed through
offerings of debt and equity securities, retained earnings and
borrowings from a commercial bank. The bank also utilized its
borrowing capacity with the Federal Home Loan Bank. The principal
amount of our term loan was $13.65 million as of March 31, 1999,
which loan matures in November 2001.

During the first quarter of 1999, we purchased approximately
$20.00 million of brokered deposit at rates between 4.55% and 4.65%
in order to fund loan growth and to provide for other liquidity
needs. Of such deposits, $5.00 million matured in May 1999 and the
remainder matures in August 1999. We may use brokered deposits in
the future as a source of liquidity.

We may from time to time repurchase shares of our common stock
in private transactions. In July 1999, we repurchased 233,219 shares
of our common stock for $2.33 million.

We also analyze our capital and the capital position of our bank
in terms of regulatory capital guidelines. This analysis of capital
is dependent upon a number of factors including asset quality,
earnings strength, liquidity, economic conditions and combinations
thereof. The Federal Reserve Board has issued standards for
measuring capital adequacy for bank holding companies. These
standards are designed to provide risk-responsive capital guidelines
and to incorporate a consistent framework for use by financial
institutions. Management believes that, as of March 31, 1999, we and
the bank met all capital adequacy requirements to which we were
subject.

<PAGE>
Allegiant's and the bank's capital ratios were as follows as of
the dates indicated:

<TABLE>
<CAPTION>
MARCH 31, 1999 DECEMBER 31, 1998
------------------------------ ------------------------------
ALLEGIANT ALLEGIANT BANK ALLEGIANT ALLEGIANT BANK
--------- -------------- --------- --------------
<S> <C> <C> <C> <C>
Total capital (to risk-weighted assets)...... 8.49% 10.63% 8.68% 10.93%
Tier 1 capital (to risk-weighted assets)..... 7.24 9.38 7.42 9.68
Tier 1 capital (to average assets)........... 6.14 7.81 5.83 7.61
</TABLE>

Our commitment to maintaining adequate capital is evidenced by
the significant increase in our average equity to average asset
ratio, which improved to 7.90% for the quarter ended March 31, 1999
compared to 6.84% for the first quarter of 1998. We will seek to
maintain a strong equity base while executing our controlled
expansion plans.

YEAR 2000

GENERAL DESCRIPTION OF THE YEAR 2000 ISSUE AND THE READINESS OF
ALLEGIANT. The Year 2000 issue is a result of computer programs
being written using two digits rather than four digits to define the
applicable year. Any of our computer programs or hardware that have
date-sensitive software or embedded chips may recognize a date using
"00" as the year 1900 rather than the year 2000. This could result
in a system failure or miscalculations causing disruptions of
operations including, among other things, a temporary inability to
process transactions, or engage in similar normal business
activities. To mitigate the risk of disruption, a Year 2000 plan has
been developed and implemented. The plan is comprised of five
phases, with completion of all five necessary to protect us against
potential Year 2000 failures.

Our plan to resolve the Year 2000 issue involves the following
five phases: awareness, assessment, remediation, testing and
implementation. During the awareness phase, a comprehensive strategy
for addressing the Year 2000 issue was formulated. We have fully
completed our assessment of all systems that could be significantly
affected by the Year 2000. The completed assessment indicated that
most of the significant information technology systems could be
affected, including the loan, deposit, general ledger and billing
systems. All software and hardware systems have been provided by
third party vendors; therefore, the remediation of systems primarily
involves the installation of upgraded systems that have been
certified by the vendors as Year 2000 compliant. We are in the
process of testing all hardware and software systems to validate
that systems have been renovated. In addition, testing will validate
the compatibility of system interfaces. After all testing is
completed, all systems will be implemented, which will include
certification that all systems are Year 2000 compliant.

YEAR 2000 STATUS, INCLUDING TIMETABLE FOR COMPLETION. As of the
date of this prospectus, the awareness and assessment phases are
100% complete. The remediation phase is substantially complete, with
only two lesser significant software systems requiring upgrades. It
is anticipated that these systems will be upgraded no later than
September 30, 1999. Testing of our systems is accomplished after
upgrades are provided by and certified as Year 2000 compliant by a
third party vendor. As of the date of this prospectus, approximately
85% of all internal systems have been tested. The testing of mission
critical systems was substantially complete by December 31, 1998.
Except for the two systems identified above, it is anticipated that
testing of all systems will be substantially completed by July 31,
1999, with the implementation phase to be completed by August 31,
1999.

IMPORTANCE OF THIRD PARTIES AND THEIR EXPOSURE TO THE YEAR 2000.
We have some systems that interface directly with significant third
party vendors. These include the Electronic Fund Transfer (EFT)
systems related to wire transfers, automated teller machine and
debit card transactions, in addition to trust system software. These
third parties have made, or are in the process of making, their
systems Year 2000 compliant. We are working with these third party
vendors to ensure that the third party systems interface properly
with our systems. Testing for these systems will be accomplished
using actual and proxy testing. Proxy testing is testing that takes
place in a controlled environment using similar software/hardware
that we and the third party vendors utilize. These tests have been
completed.

<PAGE>

We also have gathered information about the Year 2000 compliance
status of customers with significant credit relationships. In
addition, significant suppliers and other third parties that do not
share information with our systems (external agents) have been
queried to assess their Year 2000 status. As of the date of this
prospectus, there is no evidence of any significant customers or
external agents that would materially impact our operations,
liquidity or capital resources. However, we have no means of
ensuring that these entities will be Year 2000 compliant. The
inability of third parties and external agents to complete their
Year 2000 resolution process in a timely fashion could materially
impact us. The effect of non-compliant third parties and external
agents is not determinable.

YEAR 2000 COSTS. We have utilized and will continue to utilize
both internal and external resources to reprogram, replace, test and
implement the software and operating equipment for Year 2000
modifications. The total cost of the Year 2000 project is estimated
at $0.23 million and is being funded through operating cash flows.
As of the date of this prospectus, we have incurred approximately
$0.20 million ($0.11 million expensed and $0.09 million capitalized
for new systems and equipment), related to all phases of the
Year 2000 project. The total remaining project costs, which we
approximate will be $0.03 million, are attributable to the testing
and validation phases of the project and will be expensed as
incurred.

OVERALL YEAR 2000 RISKS. Management believes it has an effective
program in place to resolve the Year 2000 issue in a timely manner.
As noted above, all necessary phases of the Year 2000 program have
not yet been completed. In the event that such phases are not
completed in a timely fashion, we could experience system failures
that may have a significant impact on our financial condition. In
addition, disruptions in the economy generally resulting from the Year
2000 issue also could materially adversely affect us. We could be
subject to litigation for computer system product failures. The
amount of potential liability and lost revenue cannot be reasonably
estimated at this time.

CONTINGENCY PLANNING. We have contingency plans for certain
mission critical applications and are working on plans for all other
systems. These contingency plans involve, among other actions,
manual workarounds and adjusting staffing strategies. In addition,
funding plans are being developed to assure adequate levels of
liquid assets are available in the event of significant customer
withdrawals of cash items as a result of concerns regarding the Year
2000 issue.

<PAGE>
BUSINESS

GENERAL

We are a bank holding company headquartered in St. Louis,
Missouri. Our bank subsidiary, Allegiant Bank, offers full-service
banking and personal trust services to individuals, commercial
businesses and municipalities in the St. Louis metropolitan area.
Our services include commercial, real estate and installment loans,
checking, savings and time deposit accounts, personal trust and
other fiduciary services and various other financial services such
as securities brokerage, insurance and safe deposit boxes. As of
March 31, 1999, we reported, on a consolidated basis, total assets
of $620.86 million, loans of $520.31 million, deposits of $481.04
million and shareholders' equity of $49.06 million.

Since 1989 when we were organized, we have been committed to
building a strong, customer-friendly community bank. As a community
bank, we are able to respond quickly to our customers through local
decision-making and to tailor products and services to meet their
needs. We believe this customer-friendly approach provides us with a
competitive advantage over many of the larger financial institutions
in the St. Louis metropolitan area. In addition, we believe that we
have benefited from recent acquisitions of locally headquartered
financial institutions by larger regional or national out-of-town
financial institutions. Recent acquisitions of financial
institutions in our market area include: Bank America Corporation's
acquisition of Boatmen's Bancshares, Inc.; Union Planters'
Corporation's acquisition of Magna Group, Inc.; and the pending
acquisition by Firstar Corp. of Mercantile Bancorporation Inc.

In 1989 we acquired Allegiant State Bank located in Northeastern
Missouri. We acquired Allegiant Bank in St. Louis, Missouri in 1990. In
November 1994, we acquired Allegiant Mortgage Company. Effective in
January 1995, Allegiant State Bank was merged into Allegiant Bank. We
acquired Reliance Savings and Loan Association of St. Louis County in
August 1997 and later merged it with Allegiant Bank.

In September 1997, the bank acquired two branches in Union and
Warrenton, Missouri, from Roosevelt Bank. In that transaction, the
bank assumed approximately $96.08 million of deposit liabilities,
acquired real property and related automated teller machines,
furniture, fixtures, equipment and other operating assets with an
aggregate value of $0.54 million, and approximately $3.02 million of
consumer loans. The bank recorded goodwill of $8.83 million in
connection with this branch acquisition. In January 1999, the bank
acquired all the assets and liabilities of Allegiant Mortgage
Company which then was dissolved.

In addition to our acquisitions, we have opened several new
branches with a view toward covering all sectors of the St. Louis
metropolitan area. Branch openings in the past three years
include Mehlville in 1996, and St. Peters, Affton and Crestwood in
1997. We also opened a branch in Town & Country in 1998, and a
downtown St. Louis branch in the first quarter of 1999. Later in
1999 we will open our 15th branch in Ballwin.

Since the beginning of 1998, we have focused primarily on
improving the profitability of our banking operations. As a result,
we have reduced the amount of one- to four-family mortgages that we
hold in our loan portfolio and increased the amount of higher
yielding commercial loans. We also have hired several banking
professionals with experience in the St. Louis metropolitan area to
help us grow our commercial loans and deposits. We have refined our
market focus to concentrate exclusively on opportunities in the
higher-growth St. Louis metropolitan area and, accordingly, we sold
three retail banking offices outside the St. Louis metropolitan area
in December 1998. We also have implemented company-wide cost-control
efforts to enhance efficiencies of entire operations.

<PAGE>

The St. Louis metropolitan area is the 17th largest metropolitan
area in the United States with a population of approximately 2.45
million. The St. Louis metropolitan area is home to 19 Fortune 1000
companies, such as Anheuser-Busch Companies, Inc., Monsanto Company,
Ralston Purina Company and Trans World Airlines, Inc. Also the St.
Louis metropolitan area ranks fifth in the United States as a
headquarters location for Fortune 500 companies. In 1998, the St.
Louis area ranked second in Entrepreneur Magazine's listing of the
top places in the United States for small business, marking four
straight years on that publication's top ten list, and Inc. magazine
placed St. Louis among its top ten areas for growing firms.

OPERATIONS

The bank offers complete banking and trust services to
individuals, businesses and municipalities in the St. Louis
metropolitan area. Services include commercial, real estate,
mortgage and installment loans, checking, savings and time deposit
accounts, trust and other fiduciary services, and various other
customer services such as brokerage, insurance and safe deposit
boxes.

COMPETITION

SUPERVISION AND REGULATION

GENERAL. Financial institutions and their holding companies are
extensively regulated under federal and state law. As a result, our
growth and earnings performance can be affected not only by
management decisions and general economic conditions, but also by
the requirements of applicable state and federal statutes and
regulations and the policies of various governmental regulatory
authorities, including the Missouri Division of Finance, the Federal
Reserve Board, the Federal Deposit Insurance Corporation, the
Internal Revenue Service, state taxing authorities and the SEC. We
cannot predict with a high degree of certainty the effect of
applicable statutes, regulations and regulatory policies on us, but
believe that it could be significant.

Federal and state laws and regulations generally applicable to
financial institutions regulate, among other things, the scope of
business, investments, reserves against deposits, capital levels
relative to operations, the nature and amount of collateral for
loans, the establishment of branches, mergers, consolidations and
dividends. The system of supervision and regulation applicable to us
establishes a comprehensive framework for our operations and is
intended primarily for the protection of the FDIC's deposit
insurance funds and the depositors of the bank rather than our
shareholders.

This summary of the material elements of this regulatory
framework does not describe all applicable statutes, regulations and
regulatory policies, nor does it restate all of the requirements of
the statutes, regulations and regulatory policies that are
described. You should review the applicable statutes, regulations
and regulatory policies. Any change in applicable law, regulations
or regulatory policies may have a material effect on our business.

RECENT REGULATORY DEVELOPMENTS. Legislation is pending in
Congress that would allow bank holding companies to engage in a
wider range of nonbanking activities, including additional
securities and insurance activities. The expanded powers generally
would be available to a bank holding company only if the bank
holding company and its bank subsidiaries remain well-capitalized
and well-managed. At this time, we are unable to predict whether the
proposed legislation will be enacted and, therefore, are unable to
predict the impact such legislation may have on us.

<PAGE>
ALLEGIANT BANCORP, INC.

General. We, as the sole shareholder of the bank, are a bank
holding company. As a bank holding company, we are registered with,
and are subject to regulation by, the Federal Reserve Board under
the Bank Holding Company Act. In accordance with Federal Reserve
Board policy, we are expected to act as a source of financial
strength to the bank and to commit resources to support the bank in
circumstances where we might not otherwise do so. We are subject to
periodic examination by the Federal Reserve Board. We also are
required to file with the Federal Reserve Board periodic reports of
our operations and such additional information as the Federal
Reserve Board may require. We also are regulated by the Missouri
Division of Finance under Missouri banking laws.

Investments and Activities. Under the Bank Holding Company Act,
a bank holding company must obtain Federal Reserve Board approval
before: (a) acquiring direct or indirect ownership or control of any
voting shares of another bank or bank holding company if it would
own or control more than 5% of the shares of the other bank or bank
holding company after the acquisition (unless it already owns or
controls the majority of such shares); (b) acquiring all or
substantially all of the assets of another bank; or (c) merging or
consolidating with another bank holding company. Subject to certain
conditions (including certain deposit concentration limits), the
Federal Reserve Board may allow a bank holding company to acquire
banks located in any state of the United States regardless of
whether the acquisition is prohibited by the law of the state in
which the target bank is located. However, in approving interstate
acquisitions, the Federal Reserve Board is required to observe
applicable state law limitations on the aggregate amount of deposits
that may be held by the acquiring bank holding company and its
insured depository institution affiliates in the state in which the
target bank is located (provided that those limits do not
discriminate against out-of-state depository institutions or their
holding companies) and state laws which require that the target bank
have been in existence for a minimum period of time (up to five
years) before being acquired by an out-of-state bank holding
company.

The Bank Holding Company Act also generally prohibits bank
holding companies from acquiring direct or indirect ownership or
control of more than 5% of the voting shares of any company which is
not a bank and from engaging in any business other than that of
banking, managing and controlling banks or furnishing services to
banks and their subsidiaries. This general prohibition is subject to
a number of exceptions. The principal exception allows bank holding
companies to engage in, and to own shares of companies engaged in,
certain businesses found by the Federal Reserve Board to be "so
closely related to banking ... as to be a proper incident thereto."
Under current regulations of the Federal Reserve Board, we are
permitted to engage in a variety of banking-related businesses,
including the operation of a thrift, sales and consumer finance,
equipment leasing, the operation of a computer service bureau
(including software development), and mortgage banking and
brokerage. The Bank Holding Company Act generally does not place
territorial restrictions on the domestic activities of non-bank
subsidiaries of bank holding companies.

Capital Requirements. Bank holding companies are required to
maintain minimum levels of capital in accordance with Federal
Reserve Board capital adequacy guidelines. If capital falls below
minimum guideline levels, a bank holding company, among other
things, may be denied approval to acquire or establish additional
banks or non-bank businesses.

The Federal Reserve Board's capital guidelines contain a
risk-based requirement, expressed as a percentage of total
risk-weighted assets, and a leverage requirement, expressed as a
percentage of total assets. Bank holding companies must maintain a
minimum ratio of total capital to total risk-weighted assets of 8%,
at least one-half of which must be Tier 1 capital, and a minimum
ratio of Tier 1 capital to total assets of 3% for the most highly
rated companies, with a minimum requirement of 4% for all others.
For purposes of these capital standards, Tier 1 capital consists
primarily of permanent shareholders' equity less intangible assets
(other than certain mortgage servicing rights and purchased credit
card relationships). Up to 25% of Tier 1 capital can consist of the
proceeds of the sale of trust preferred securities. Total capital
consists primarily of Tier 1 capital plus certain other debt and
equity instruments that do not qualify as Tier 1 capital, including
any proceeds from the sale of trust preferred securities that would
exceed 25% of Tier 1 capital, and a portion of the bank holding
company's allowance for loan and lease losses.

<PAGE>
The risk-based and leverage standards described above are
minimum requirements. Higher capital levels will be required if
warranted by the particular circumstances or risk profiles of
individual banking organizations. For example, the Federal Reserve
Board's capital guidelines contemplate that additional capital may
be required to take adequate account of, among other things,
interest rate risk, or the risks posed by concentrations of credit,
nontraditional activities or securities trading activities. Further,
any banking organization experiencing or anticipating significant
growth would be expected to maintain capital ratios, including
tangible capital positions (i.e., Tier 1 capital less all intangible
assets), well above the minimum levels.

As of March 31, 1999, we had regulatory capital in excess of the
Federal Reserve Board's minimum requirements, with a total risk-based
capital ratio of 8.49% and a Tier 1 leverage capital ratio of 6.14%.
The Federal Reserve Board does not (and has not in the past) require
us to maintain our capital at levels exceeding minimum requirements.

Dividends. Under Missouri law, we may not pay dividends if our
net assets are less than our stated capital or if payment of
dividends would reduce our net assets below our stated capital.
Additionally, the Federal Reserve Board has issued a policy
statement about the payment of cash dividends by bank holding
companies. The policy statement provides that a bank holding company
should not pay cash dividends that exceed its net income or which
can only be funded in ways that weaken the bank holding company's
financial health, such as by borrowing. The Federal Reserve Board
also possesses enforcement powers over bank holding companies and
their non-bank subsidiaries to prevent or remedy actions that
represent unsafe or unsound practices or violations of applicable
statutes and regulations. These powers include proscribing the
payment of dividends by banks and bank holding companies.

Federal Securities Regulation. Our common stock is registered
with the SEC under the Securities Exchange Act of 1934.
Consequently, we are subject to the information, proxy solicitation,
insider trading and other restrictions and requirements of the SEC
under the Securities Exchange Act of 1934.

ALLEGIANT BANK

General. The bank is chartered in Missouri, and its deposit
accounts are insured by the FDIC's Bank Insurance Fund. As an
FDIC-insured, Missouri-chartered bank, the bank is subject to the
examination, supervision, reporting and enforcement requirements of
the Missouri Division of Finance, as the chartering authority for
Missouri banks, and the FDIC, as administrator of the Bank Insurance
Fund.

Deposit Insurance. As an FDIC-insured institution, the bank is
required to pay deposit insurance premium assessments to the FDIC.
The FDIC has adopted a risk-based assessment system under which all
insured depository institutions are placed into one of nine
categories and assessed insurance premiums based upon their
respective levels of capital and results of supervisory evaluations.
Institutions classified as well-capitalized (as defined by the FDIC)
and considered healthy pay the lowest premium while institutions
that are less than adequately capitalized (as defined by the FDIC)
and considered of substantial supervisory concern pay the highest
premium. The FDIC risk classifies all insured institutions for each
semi-annual assessment period.

During the semi-annual assessment period which began January 1,
1999, Bank Insurance Fund assessment rates ranged from 0% of
deposits to 0.27% of deposits. During the semi-annual assessment
period beginning July 1, 1999, Bank Insurance Fund assessment rates
will continue to range from 0% of deposits to 0.27% of deposits.

The FDIC may terminate the deposit insurance of any insured
depository institution if the FDIC determines, after a hearing, that
the institution (a) has engaged or is engaging in unsafe or unsound
practices, (b) is in an unsafe or unsound condition to continue
operations or (c) has violated any applicable law, regulation,
order, or any condition imposed in writing by, or written agreement
with, the FDIC. The FDIC also may suspend deposit insurance
temporarily during a hearing process about permanent termination of
insurance if the institution has no tangible capital. We are not
aware of any activity or condition that could result in termination
of the deposit insurance of the bank.

<PAGE>
Financing Corporation Assessments. Since 1987, a portion of the
deposit insurance assessments paid by members of the FDIC's Savings
Association Insurance Fund has been used to cover interest payments
due on the outstanding obligations of the Financing Corporation. The
Financing Corporation was created in 1987 to finance the
recapitalization of the Federal Savings and Loan Insurance
Corporation, the predecessor insurance fund to the Savings
Association Insurance Fund.

As a result of federal legislation enacted in 1996, beginning
January 1, 1997, both Savings Association Insurance Fund members and
Bank Insurance Fund members became subject to assessments to cover
the interest payments on outstanding Financing Corporation
obligations. These assessments are in addition to amounts assessed
by the FDIC for deposit insurance. Until January 1, 2000, the
Financing Corporation assessments made against Bank Insurance Fund
members may not exceed 20% of the amount of the Financing
Corporation assessments made against Savings Association Insurance
Fund members. Between January 1, 2000 and the final maturity of the
outstanding Financing Corporation obligations in 2019, Bank
Insurance Fund members and Savings Association Insurance Fund
members will share the cost of the interest on the Financing
Corporation bonds on a pro rata basis. During the year ended
December 31, 1998, the Financing Corporation assessment rate for
Savings Association Insurance Fund members ranged between
approximately 0.061% of deposits and approximately 0.063% of
deposits, while the Financing Corporation assessment rate for Bank
Insurance Fund members ranged between approximately 0.012% of
deposits and approximately 0.013% of deposits. During the quarter
ended March 31, 1999, the Financing Corporation assessment rate for
Bank Insurance Fund members was approximately 0.012% of deposits and
the Financing Corporation assessment rate for Savings Association
Insurance Fund members was approximately 0.061% of deposits.

Supervisory Assessments. All Missouri banks are required to pay
supervisory assessments to the Missouri Division of Finance to fund
the operations of the Missouri Division of Finance. The amount of
the assessment is calculated based on a formula established by the
Missouri Division of Finance which takes into account the
institution's total assets.

Capital Requirements. The FDIC has established minimum capital
standards for state-chartered insured non-member banks, such as the
bank, comprised of a leverage requirement and a risk-based capital
requirement. The leverage requirement mandates a minimum ratio of
Tier 1 capital to total assets of 3% for the most highly-rated banks
and at least 4% for all others. The risk-based capital requirement
provides for a minimum ratio of total capital to total risk-weighted
assets of 8%, at least one-half of which must be Tier 1 capital. For
purposes of these capital standards, Tier 1 capital and total
capital consist of substantially the same components as Tier 1
capital and total capital under the Federal Reserve Board's capital
guidelines for bank holding companies.

The foregoing capital requirements are minimum requirements.
Higher capital levels will be required if warranted by the
particular circumstances or risk profiles of individual
institutions. For example, the regulations of the FDIC provide that
additional capital may be required to take adequate account of,
among other things, interest rate risk or the risks posed by
concentrations of credit, nontraditional activities or securities
trading activities.

During the year ended December 31, 1998 and the quarter ended
March 31, 1999, the bank was not required by the FDIC to increase
its capital to an amount in excess of the minimum regulatory
requirement. As of March 31, 1999, the bank exceeded its minimum
regulatory capital requirements with a Tier 1 leverage capital ratio
of 7.81% and a total risk-based capital ratio of 10.63%.

Federal law provides the federal banking regulators with broad
power to take prompt corrective action to resolve the problems of
undercapitalized institutions. The extent of the regulators' powers
depends on whether an institution is "well capitalized," "adequately
capitalized," "undercapitalized," "significantly undercapitalized"
or "critically undercapitalized," in each case as defined by
regulation. Depending upon the capital category to which an
institution is assigned, the regulators' corrective powers include:
(a) requiring the institution to submit a capital restoration plan;
(b) limiting the institution's asset growth and restricting its
activities; (c) requiring the institution to issue additional
capital stock (including additional voting stock) or to be acquired;
(d) restricting transactions between the institution and its
affiliates; (e) restricting the interest rate the institution can
pay on deposits; (f) ordering a new election of directors of the

<PAGE>
institution; (g) requiring that senior executive officers or
directors be dismissed; (h) prohibiting the institution from
accepting deposits from correspondent banks; (i) requiring the
institution to divest certain subsidiaries; (j) prohibiting the
payment of principal or interest on subordinated debt; (k) and
ultimately, appointing a receiver for the institution. As of March
31, 1999, the bank was "well capitalized," as defined by FDIC
regulations.

Dividends. Under Missouri law, the bank may pay dividends out of
its undivided profits. The payment of dividends by any financial
institution or its holding company, however, is affected by the
requirement to maintain adequate capital pursuant to applicable
capital adequacy guidelines and regulations, and a financial
institution generally is prohibited from paying any dividends if,
following payment of a dividend, the institution would be
undercapitalized. As described above, the bank exceeded its minimum
capital requirements under applicable guidelines as of March 31,
1999. As of March 31, 1999, approximately $13.21 million was
available to be paid as dividends by the bank to us. However, the
FDIC or the Missouri Division of Finance may prohibit the payment of
any dividends from these available funds by the bank if either
determines such payment would constitute an unsafe or unsound
practice.

Insider Transactions. The bank is subject to certain
restrictions imposed by federal law on extensions of credit to us,
on investments in our stock or other of our securities and the
acceptance of our stock or other securities as collateral for loans.
Certain limitations and reporting requirements also are placed on
extensions of credit by the bank to its directors and officers, to
our directors and officers, to our principal shareholders, and to
"related interests" of such directors, officers and principal
shareholders. In addition, federal law and regulations may affect
the terms upon which any person becoming one of our directors or
officers or one of our principal shareholders may obtain credit from
banks with which the bank maintains a correspondent relationship.

Safety and Soundness Standards. The federal banking agencies
have adopted guidelines which establish operational and managerial
standards to promote the safety and soundness of federally insured
depository institutions. The guidelines set forth standards for
internal controls, information systems, internal audit systems, loan
documentation, credit underwriting, interest rate exposure, asset
growth, compensation, fees and benefits, asset quality and earnings.
In addition, in October 1998, the federal banking regulators issued
safety and soundness standards for achieving Year 2000 compliance,
including standards for developing and managing Year 2000 project
plans, testing remediation efforts and planning for contingencies.

In general, the safety and soundness guidelines prescribe the
goals to be achieved in each area, and each institution is
responsible for establishing its own procedures to achieve those
goals. If an institution fails to comply with any of the standards
set forth in the guidelines, the institution's primary federal
regulator may require the institution to submit a plan for achieving
and maintaining compliance. If an institution fails to submit an
acceptable compliance plan, or fails in any material respect to
implement a compliance plan that has been accepted by its primary
federal regulator, the regulator is required to issue an order
directing the institution to cure the deficiency. Until the
deficiency cited in the regulator's order is cured, the regulator
may restrict the institution's rate of growth, require the
institution to increase its capital, restrict the rates the
institution pays on deposits or require the institution to take any
action the regulator deems appropriate under the circumstances.
Noncompliance with the standards established by the safety and
soundness guidelines may also constitute grounds for other
enforcement action by the federal banking regulators, including
cease and desist orders and civil money penalty assessments.

Branching Authority. Missouri banks, such as the bank, have the
authority under Missouri law to establish branches anywhere in the
State of Missouri, subject to receipt of all required regulatory
approvals.

Under the Riegle-Neal Interstate Banking and Branching
Efficiency Act of 1994, both state and national banks are allowed to
establish interstate branch networks by acquiring other banks,
subject to certain conditions, including limitations on the
aggregate amount of deposits that may be held by the surviving bank
and all of its insured depository institution affiliates.
Establishing new interstate branches or acquiring individual
branches of a bank in another state (rather than acquiring an
out-of-state bank in its entirety) is allowed by the Riegle-Neal Act
only if specifically authorized by state law. The legislation
allowed individual states to "opt-out" of certain provisions of the
Riegle-Neal Act by enacting appropriate legislation prior to June 1,
1997. Missouri enacted legislation permitting interstate mergers
beginning on

<PAGE>
June 1, 1997, subject to certain conditions, including a prohibition
against interstate mergers involving a Missouri bank that has been
in existence and continuous operation for fewer than five years.

State Bank Activities. Under federal law and FDIC regulations,
FDIC-insured state banks are prohibited, subject to certain
exceptions, from making or retaining equity investments of a type,
or in an amount, that are not permissible for a national bank.
Federal law and FDIC regulations also prohibit FDIC-insured state
banks and their subsidiaries, subject to certain exceptions, from
engaging as principal in any activity that is not permitted for a
national bank or its subsidiary, respectively, unless the bank
meets, and continues to meet, its minimum regulatory capital
requirements, and the FDIC determines the activity would not pose a
significant risk to the deposit insurance fund of which the bank is
a member. These restrictions have not had, and are not currently
expected to have, a material impact on the operations of the bank.

Federal Reserve System. Federal Reserve Board regulations, as
presently in effect, require depository institutions to maintain
non-interest earning reserves against their transaction accounts
(primarily NOW and regular checking accounts), as follows: for
transaction accounts aggregating $46.5 million or less, the reserve
requirement is 3% of total transaction accounts; and for transaction
accounts aggregating in excess of $46.5 million, the reserve
requirement is $1.395 million plus 10% of the aggregate amount of
total transaction accounts in excess of $46.5 million. The first
$4.9 million of otherwise reservable balances are exempted from the
reserve requirements. These reserve requirements are subject to
annual adjustment by the Federal Reserve Board. The bank is in
compliance with these requirements.

EMPLOYEES

As of March 31, 1999, we had approximately 228 full-time
equivalent employees. None of our employees is subject to a
collective bargaining agreement. We consider our relationships with
our employees and those of the bank to be good.

PROPERTIES

Our principal executive, administrative and operational offices
are located at 2122 Kratky Road in St. Louis, Missouri. The bank
conducts its business and operations out of 14 locations in the
St. Louis metropolitan area. Our physical properties, which are
either owned or leased, are in satisfactory condition, adequately
insured and suitable and adequate for present operations.

<PAGE>
The following table sets forth the location and certain
additional information regarding our banking facilities as of the
date hereof. The expiration date shown includes the renewal option
periods available to the bank.

<TABLE>
<CAPTION>
YEAR OWNED OR LEASED/ APPROXIMATE
BANKING FACILITIES OPENED EXPIRATION DATE SQUARE FOOTAGE
- ------------------ ------ ---------------- --------------
<S> <C> <C> <C>
ST. LOUIS, GRAND
4323 North Grand Blvd. 1990 Owned 10,000
St. Louis, MO 63107

WEST PORT
157 Westport Plaza Drive 1992 Leased/2012 2,500
Maryland Heights, MO 63146

HAZELWOOD
7650 North Lindbergh 1992 Owned 5,000
Hazelwood, MO 63042

CLAYTON
7801 Forsyth Blvd. 1994 Leased/2004 3,200
Clayton, MO 63105

DES PERES
12100 Manchester Road 1995 Owned 2,300
Des Peres, MO 63131

SOUTH COUNTY
7421 South Lindbergh Blvd. 1996 Leased/2015 1,900
Mehlville, MO 63125

ST. PETERS
3551 Harvester Road 1997 Owned 2,500
St. Peters, MO 63303

WARRENTON
236 East Booneslick Road 1997 Owned 1,800
Warrenton, MO 63383

UNION
509 Highway 50 West 1997 Owned 2,900
Union, MO 63084

CRESTWOOD
9792 Watson Road 1997 Leased/2017 2,500
Crestwood, MO 63126

AFFTON
8930 Gravois 1997 Owned 4,400
Affton, MO 63123

TOWN & COUNTRY
157 Lamp & Lantern Village 1998 Owned 3,500
Town & Country, MO 63017

HEADQUARTERS
2122 Kratky Road 1998 Owned 22,000
St. Louis, MO 63114

ST. LOUIS, DOWNTOWN
119 North Broadway 1999 Leased/2028 3,000
St. Louis, MO 63102

BALLWIN<F1>
15061 Manchester Road 1999 Owned 6,000
Ballwin, MO 63011

<FN>
- --------
<F1> Planned opening in August 1999
</TABLE>

LEGAL PROCEEDINGS

Various claims and lawsuits, incidental to the ordinary course
of business, are pending against us. In the opinion of management,
after consultation with legal counsel, resolution of these matters
is not expected to have a material effect on our consolidated
financial condition or results of operations.

<PAGE>
MANAGEMENT

The following table sets forth certain information regarding the
directors and executive officers of Allegiant:

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Marvin S. Wool........................ 70 Chairman of the Board
Shaun R. Hayes........................ 39 President, Chief Executive Officer and Director
Leland B. Curtis...................... 55 Director
Kevin R. Farrell...................... 48 Director and Secretary
Leon A. Felman........................ 64 Director
C. Virginia Kirkpatrick............... 65 Director
Jack K. Krause........................ 67 Director
John L. Weiss......................... 44 Director
Lee S. Wielansky...................... 48 Director
Thomas A. Daiber...................... 41 Senior Vice President and Chief Financial Officer
</TABLE>

Marvin S. Wool has served as a director of Allegiant since 1990
and as the Chairman of Allegiant and Chairman of the bank since
March 1992. From March 1992 through 1998, Mr. Wool served as Chief
Executive Officer of Allegiant. For more than the past five years,
Mr. Wool has served as the President and Chief Executive Officer of
Dash Multi-Corp, Inc., the holding company for subsidiary companies
located in Georgia, Mississippi, Missouri, New Jersey and California
that are in the chemical, cloth coating and carpet industries. Mr.
Wool serves as a director of R-B Rubber Products, Inc., a recycler
and manufacturer of rubber products.

Shaun R. Hayes has served as a director and the President of
Allegiant since 1989 and became Chief Executive Officer of Allegiant
in January 1999. Additionally, Mr. Hayes has served as President and
Chief Executive Officer of the bank since May 1992. From November
1986 through May 1989, Mr. Hayes was Senior Vice President and
Manager of the Metropolitan Banking Division of United Missouri Bank
of St. Louis, where he served as a member of that bank's executive
committee and acted as an advisor to its Board of Directors. Mr.
Hayes currently serves on the Board of Directors of the American
Institute of Banking as well as the United Way of St. Louis.

Leland B. Curtis has been a director since 1996. Mr. Curtis has
been a partner in the law firm of Curtis, Oetting, Heinz, Garrett &
Soule, a law firm located in St. Louis, Missouri, for more than the
past five years.

Kevin R. Farrell has served as a director of Allegiant since
1989 and as Secretary of Allegiant since 1994. Mr. Farrell has been
President of St. Louis Steel Products, Inc., a steel fabricating company,
for more than the past five years.

Leon A. Felman has been a director of Allegiant since 1992. For
more than the past five years, Mr. Felman has been associated with
Sage Systems, Inc., which until June 1999 was a franchisee of Arby's
restaurants in the St. Louis area, and currently serves as its
President and Chief Executive Officer.

C. Virginia Kirkpatrick has been a director of Allegiant since
1990. Ms. Kirkpatrick has been President of CVK Personal Management
& Training Specialists, a business consulting and human resource
management firm, for more than the past five years.

Jack K. Krause has been a director of Allegiant since 1998. Mr.
Krause has been the President and Chief Executive Officer of
Jenkin-Guerin, Inc., a lubricant manufacturing company, since 1971.

John L. Weiss has served as a director of Allegiant since March
1999 and as a director of the bank since 1996. Mr. Weiss has been
President of Brentwood Volvo, Ltd, an automobile dealership in St. Louis,
Missouri, for more than the past five years.

<PAGE>

Lee S. Wielansky has been a director of Allegiant since 1990 and
became Vice Chairman of the bank in February 1999. Mr. Wielansky has
been the Managing Director-Investments and a member of the Board of
Directors of Regency Realty Corporation, a real estate investment trust,
since 1998. Prior to such time, he was the President and Chief Executive
Officer of Midland Development Group, Inc., a real estate development
company, for more than five years.

Thomas A. Daiber has served as a Senior Vice President and the
Chief Financial Officer of Allegiant since May 7, 1999. Mr. Daiber
has been employed by Allegiant since March 17, 1997 and served most
recently as the Director of Internal Auditing. Prior to joining
Allegiant, Mr. Daiber served as an officer of Pioneer Bank and Trust
Company or its holding company, Forbes First Financial Corporation,
for more than five years.

COMMITTEES OF THE BOARD OF DIRECTORS

EXECUTIVE COMMITTEE. Marvin S. Wool (Chairperson), Shaun R.
Hayes, C. Virginia Kirkpatrick, Kevin R. Farrell and Lee S.
Wielansky are the members of the executive committee. The executive
committee may exercise all powers of the Board of Directors that may
be lawfully delegated when the Board of Directors is not in session.

AUDIT COMMITTEE. C. Virginia Kirkpatrick (Chairperson), Jack K.
Krause and Leon A. Felman are the members of the audit committee of
the Board of Directors of Allegiant. The audit committee's duties
include meeting with the independent auditors, management, internal
auditors, compliance and credit review personnel to periodically
review the work of each and ensure that each is properly discharging
its responsibilities. On January 1, 1999, the audit committee
assumed the duties of the former directors' responsibility
committee. The directors' responsibility committee was responsible
for periodically reviewing transactions between directors and
Allegiant to ensure compliance with various regulatory and other
requirements.

DIRECTORS' AND EXECUTIVES' COMPENSATION COMMITTEE. Leland B.
Curtis (Chairperson), Kevin Farrell and John L. Weiss are the
members of the directors' and executives' compensation committee.
The directors' and executives' compensation committee reviews and
recommends the salaries and other compensation of all directors and
executive officers of Allegiant.

<PAGE>
BENEFICIAL OWNERSHIP

The following table sets forth information regarding the amount
of common stock of Allegiant beneficially owned, as of June 24,
1999, by each person who is a director or executive officer of
Allegiant or who is known by us to own beneficially more than 5% of
our common stock, and all directors and executive officers of
Allegiant as a group:

<TABLE>
<CAPTION>
NAME OF NUMBER OF SHARES
BENEFICIAL BENEFICIALLY PERCENT
OWNER OWNED<F1> OF CLASS
---------- ---------------- --------
<S> <C> <C>
Marvin S. Wool.................................... 769,369<F2> 11.5%
Shaun R. Hayes.................................... 451,733<F3> 6.8
Leon A. Felman.................................... 554,615<F4> 8.4
Kevin R. Farrell.................................. 295,096<F5> 4.5
Lee S. Wielansky.................................. 163,210<F6> 2.4
C. Virginia Kirkpatrick........................... 166,555<F7> 2.5
Leland B. Curtis.................................. 35,079<F8> <F9>
Jack K. Krause.................................... 142,777<F10> 2.2
John L. Weiss..................................... 7,422<F11> <F9>
Thomas A. Daiber.................................. 1,080<F12> <F9>

All directors and executive officers as a group
(10 persons).................................... 2,586,936<F13> 37.7%

<FN>
- -------
<F1> Except as otherwise indicated, each individual has sole voting and
investment power over the shares listed beside his or her name. The
percentage calculations for beneficial ownership are based upon 6,611,160
shares of common stock that were issued and outstanding as of June 24,
1999, plus, with respect to each individual and for all directors and
executive officers as a group, the number of shares subject to options
and warrants that may be acquired upon exercise or conversion within 60
days of June 24, 1999.

<F2> Total includes: 76,005 shares held by the Dash Industries Pension Plan;
63,636 shares held in trusts for the benefit of Mr. Wool's children; and
52,354 shares subject to stock options that are presently exercisable or
which are exercisable within 60 days of June 24, 1999. Mr. Wool's address
is 2500 Adie Road, Maryland Heights, Missouri 63043.

<F3> Total includes: 15,661 shares held of record by Mr. Hayes' spouse, as to
which shares Mr. Hayes has shared voting and investment power; 4,956
shares held by Mr. Hayes' spouse as custodian for Mr. Hayes' three
children; and 60,781 shares subject to stock options that are presently
exercisable or which are exercisable within 60 days of June 24, 1999. Mr.
Hayes' address is 2122 Kratky Road, St. Louis, Missouri 63114.

<F4> Total includes 9,900 shares subject to stock options that are presently
exercisable or which are exercisable within 60 days of June 24, 1999. Mr.
Felman's address is 2122 Kratky Road, St. Louis, Missouri 63114.

<F5> Total includes: 178,326 shares held of record by Pentastar Family
Holdings, Inc.; 51,733 shares held by Mr. Farrell as custodian for his
four children; 3,136 shares held by NFSC/FMTC as Trustee for the IRA of
Mr. Farrell's spouse; 505 shares held by Everen Clearing Corporation as
custodian for Mr. Farrell's family; and 9,900 shares subject to stock
options that are presently exercisable or which are exercisable within 60
days of June 24, 1999.

<F6> Total includes 51,300 shares subject to stock options that are presently
exercisable or which are exercisable within 60 days of June 24, 1999.

<F7> Total includes: 23,049 shares held jointly with Ms. Kirkpatrick's spouse;
14,520 shares held of record by Ms. Kirkpatrick's spouse; 19,422 shares
held by Paine Webber as Trustee for the IRA of Ms. Kirkpatrick's spouse;
8,120 shares held jointly with Ms. Kirkpatrick's children; and 39,930
shares subject to stock options that are presently exercisable or which
are exercisable within 60 days of June 24, 1999.

<F8> Total includes 18,480 shares subject to stock options that are presently
exercisable or which are exercisable within 60 days of June 24, 1999.

<F9> Less than one percent.

<F10> Total includes 5,700 shares subject to stock options that are presently
exercisable or which are exercisable within 60 days of June 24, 1999.

<F11> Total includes: 3,720 shares subject to stock options that are presently
exercisable or which are exercisable within 60 days of June 24, 1999; and
1,118 shares held of record by Mr. Weiss's spouse.

<F12> Includes 720 shares subject to stock options that are presently
exercisable or which are exercisable within 60 days of June 24, 1999.

<F13> Total includes 252,785 shares subject to stock options that are presently
exercisable or which are exercisable within 60 days of June 24, 1999.
</TABLE>

<PAGE>
<PAGE>
ALLEGIANT CAPITAL TRUST I

The Trust is a statutory business trust created under Delaware
law pursuant to the filing of a Certificate of Trust with the
Delaware Secretary of State on June 30, 1999. The Trust will be
governed by the trust agreement among us, as depositor, Bankers
Trust (Delaware), as Delaware trustee, Bankers Trust Company, as
property trustee and two individuals selected by us to act as
administrators with respect to the Trust. While we hold the trust
common securities, we intend to select two individuals who are our
employees or officers or affiliated with us to serve as the
administrators. See "Description of Trust Preferred Securities--
Miscellaneous." The Trust exists for the exclusive purposes of:

* issuing and selling the trust preferred securities and the
trust common securities;

* using the proceeds from the sale of the trust preferred
securities and the trust common securities to acquire the
junior subordinated debentures; and

* engaging in only those other activities necessary, convenient
or incidental thereto (such as registering the transfer of the
trust preferred securities and the trust common securities).

Accordingly, the junior subordinated debentures will be the sole
assets of the Trust, and payments under the junior subordinated
debentures will be the sole source of revenue of the Trust.

We will own all of the trust common securities. The trust common
securities will rank equally, and payments on them will be made pro
rata, with the trust preferred securities, except that upon the
occurrence and during the continuation of an event of default under
the junior subordinated debentures, our rights as the holder of the
trust common securities to payment in respect of distributions and
payments upon liquidation, redemption or otherwise will be
subordinated to the rights of the holders of the trust preferred
securities. See "Description of Trust Preferred Securities--
Subordination of Trust Common Securities." We will acquire trust
common securities in an aggregate liquidation amount equal to at
least 3.75% of the total capital of the Trust. The Trust has a term
of 30 years, but may terminate earlier as provided in the trust
agreement.

The address of the Delaware trustee is Bankers Trust (Delaware),
1101 Centre Road, Suite 200, Trust Department, Wilmington, Delaware
19805, and the telephone number is (302) 636-3301.

The address of the property trustee, the guarantee trustee and
the debenture trustee is Bankers Trust Company, Four Albany Street,
4th Street, New York, New York 10006, and the telephone number is
(212) 250-2500.

<PAGE>
DESCRIPTION OF TRUST PREFERRED SECURITIES

The Trust will issue the trust preferred securities and the
trust common securities under the trust agreement for the Trust.
This summary of certain provisions of the trust preferred securities
and the trust agreement is not complete. You should read the form of
the trust agreement, which is filed as an exhibit to the
registration statement of which this prospectus is a part. Wherever
particular defined terms of the trust agreement are referred to in
this prospectus, such defined terms are incorporated herein by
reference. A copy of the form of the trust agreement also is
available upon request from the trustees.

In addition, the trust agreement will be qualified as an
indenture under the Trust Indenture Act of 1939. The terms of the
trust preferred securities include those made a part of the trust
agreement by the Trust Indenture Act. Therefore, this summary is
qualified by reference to the Trust Indenture Act and you should be
familiar with its provisions.

GENERAL

The trust preferred securities will be limited to $15 million
aggregate liquidation amount outstanding (which amount will be
increased by up to $2.25 million aggregate liquidation amount of
trust preferred securities if the underwriters exercise their
over-allotment option in full). See "Underwriting." The trust
preferred securities will rank equally, and payments will be made
pro rata, with the trust common securities except as described under
"--Subordination of Trust Common Securities." We will purchase and
hold all of the trust common securities. The Trust will use the
proceeds from selling the trust preferred securities and the trust
common securities to purchase the junior subordinated debentures
from us. The junior subordinated debentures will be registered in
the name of the Trust and held by the property trustee in trust for
your benefit and for our benefit as holder of the trust common
securities. The guarantee we will execute for the benefit of the
holders of the trust preferred securities will be a guarantee on a
subordinated basis with respect to the trust preferred securities
but will not guarantee payment of distributions or amounts payable
on redemption or liquidation of the trust preferred securities when
the Trust does not have funds on hand available to make such
payments. See "Description of Guarantee."

DISTRIBUTIONS

You will receive distributions on each trust preferred security
at the annual rate of 9.875% of the stated liquidation amount of $10,
payable quarterly in arrears on March 31, June 30, September 30 and
December 31 of each year, to record holders at the close of business
on the 15th day of the month of the relevant distribution date. Each
date on which distributions will be paid is referred to as a distribution
date in this prospectus. Distributions on the trust preferred securities
will be cumulative. Distributions will accumulate from August 2, 1999. The
first distribution date for the trust preferred securities will be September
30, 1999. Distributions payable for each full distribution period will be
computed by dividing the annual rate by four. The amount of distributions
payable for any period less than a full distribution period will be computed
on the basis of a 360-day year of twelve 30-day months and the actual days
elapsed in a partial month in such period. If any date on which
distributions are payable is not a business day or a holiday, then
payment will be made on the next succeeding day that is a business
day and not a holiday (without any additional distributions or other
payment because of the delay), except that, if such business day
falls in the next calendar year, the payment will be made on the
immediately preceding business day.

The term "distributions" includes quarterly distributions,
distributions that accumulate on distributions not paid on the
applicable distribution date and, if applicable, any additional sums
paid during a tax event, all as further described herein.

So long as no event of default under the indenture has occurred
and is continuing, we have the right to defer the payment of
interest on the junior subordinated debentures at any time or from
time to time for an "extension period" that does not (a) exceed 20
consecutive quarterly periods with respect to each extension period,
(b) extend beyond the maturity date of the junior subordinated
debentures or (c) end on a date that is not a distribution date. As
a consequence of any such deferral, quarterly distributions on the
trust preferred securities will be deferred during the extension
period. Distributions to which you are entitled will accumulate
additional distributions thereon at an annual rate of 9.875%.

<PAGE>
During any extension period, we may not (1) declare or pay any
dividends or distributions on, or redeem, purchase, acquire or make
a liquidation payment with respect to, any of our capital stock, (2)
make any payment of principal of or interest or premium, if any, on
or repay, repurchase or redeem any of our debt securities that rank
equally with or junior in interest to the junior subordinated
debentures (including the trust preferred securities), or (3)
redeem, purchase or acquire less than all of the junior subordinated
debentures or any of the trust preferred securities.

These prohibitions, however, do not apply to:

* repurchases, redemptions or other acquisitions of our capital
stock, in order to satisfy our obligations under any
employment contract, benefit plan or other similar
arrangement, a dividend reinvestment or shareholder stock
purchase plan or in connection with the issuance of our capital
stock (or securities convertible into or exercisable for such
capital stock) as consideration in any acquisition transactions
announced at least 30 days prior to any extension period;

* a reclassification, exchange or conversion of any class or
series of our capital stock (or any capital stock of the bank,
any of its subsidiaries or any of our future subsidiaries) for
any class or series of our capital stock;

* the purchase of fractional interests in shares of our capital
stock pursuant to the conversion or exchange provisions of
such capital stock or the security being converted or
exchanged;

* any declaration of a dividend in connection with any
shareholders' rights plan, or the issuance of rights, stock or
other property under any shareholders' rights plan, or the
redemption or repurchase of rights pursuant thereto; or

* any dividend in the form of stock, warrants, options or other
rights where the dividend stock or the stock issuable upon
exercise of such warrants, options or other rights is the same
stock as that on which the dividend is being paid or ranks
equally with or junior to such stock.

Before the end of an extension period, we may extend the
extension period (subject to the limits imposed on the duration and
ending date of an extension period), further deferring the payment
of interest as long as no event of default under the indenture has
occurred and is continuing. Upon the termination of an extension
period and the payment of all amounts then due, we may elect to
begin a new extension period subject to the above conditions. No
interest will be due on the junior subordinated debentures during an
extension period, except at the end of the extension period. We must
give you and the trustees notice of our election of an extension
period at least one business day prior to the earlier of (1) the
date the distributions on the trust preferred securities would have
been payable but for the election to begin the extension period and
(2) the date the property trustee is required to give you notice of
the record date or the date the distributions are payable, but in
any event not less than one business day prior to the record date.
The property trustee will give you notice of our election to begin a
new extension period. Subject to the foregoing, there is no
limitation on the number of times that we may elect to begin an
extension period. During an extention period, distributions will
continue to accumulate, and you will be required to accrue and
recognize interest income for United States federal income tax
purposes. See "Description of Junior Subordinated Debentures--Option
To Extend Interest Payment Period" and "Certain United States
Federal Income Tax Consequences--Interest Income and Original Issue
Discount."

We currently do not intend to exercise our right to defer
payments of interest by extending the interest payment period on the
junior subordinated debentures.

The revenue of the Trust available for distribution to you will
be limited to payments under the junior subordinated debentures.
Under the terms of the trust agreement, the trust cannot issue any
securities other than trust preferred securities, incur any
indebtedness or pledge any of its assets. If we do not make payments
on the junior subordinated debentures, the Trust may not have funds
available to pay distributions or other amounts payable on the trust
preferred securities. The payment of distributions and other amounts
payable on the trust preferred securities (if and to the extent the
Trust has funds sufficient to make such payments) is guaranteed by
us on a limited basis as set forth herein under "Description of
Guarantee."

<PAGE>
REDEMPTION

The junior subordinated debentures mature on August 2, 2029.
We may redeem the junior subordinated debentures (1) on or after
August 2, 2004 in whole at any time or in part from time to
time, or (2) in whole, but not in part, at any time within 90 days
following the occurrence and during the continuation of a tax event,
investment company event or capital treatment event (each as defined
below), in each case subject to prior regulatory approval if it is
then required. See "--Liquidation Distribution Upon Dissolution." We
also may repurchase the junior subordinated debentures, in whole or
in part, from the Trust any time after August 2, 2004. A redemption
or repurchase of the junior subordinated debentures would cause a
mandatory redemption of a proportionate amount of the trust preferred
securities and trust common securities at the redemption price.

"Tax event" means the receipt by us and the Trust of an opinion
of counsel experienced in such matters to the effect that, as a
result of any amendment to, or change (including an announced
prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority,
or as a result of any official or administrative pronouncement or
judicial decision interpreting or applying such laws or regulations,
which amendment or change is effective or which pronouncement or
decision is announced on or after the date of issuance of the trust
preferred securities, there is more than an insubstantial risk that:

* the Trust is, or will be within 90 days of the delivery of
such opinion, subject to United States federal income tax with
respect to income received or accrued on the junior
subordinated debentures;

* interest payable by us on the junior subordinated debentures
is not, or within 90 days of the delivery of such opinion will
not be, deductible by us, in whole or in part, for United
States federal income tax purposes; or

* the Trust is, or will be within 90 days of the delivery of
such opinion, subject to more than a de minimis amount of
other taxes, duties or other governmental charges.

See "Certain United States Federal Income Tax Consequences--Pending
Tax Litigation Affecting the Trust Preferred Securities" for
discussion of pending United States Tax Court litigation that, if
decided adversely to the taxpayer, could give rise to a tax event,
that may permit us to redeem the junior subordinated debentures
prior to August 2, 2004.

If a tax event described in the first or third circumstances
above has occurred and is continuing and the Trust holds all of the
junior subordinated debentures, we will pay on the junior
subordinated debentures any additional amounts as may be necessary
in order that the amount of distributions then due and payable by
the Trust on the outstanding trust preferred securities and trust
common securities of the Trust will not be reduced as a result of
any additional taxes, duties and other governmental charges to which
the Trust has become subject.

"Investment company event" means the receipt by us and the Trust
of an opinion of counsel experienced in such matters to the effect
that, as a result of the occurrence of a change in law or regulation
or a written change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or
regulatory authority, the Trust is or will be considered an
"investment company" that is required to be registered under the
Investment Company Act of 1940, which change becomes effective on or
after the date of the issuance of the trust preferred securities.

"Capital treatment event" means the receipt by us and the Trust
of an opinion of counsel experienced in such matters to the effect
that, as a result of the occurrence of any amendment to, or change
(including any announced prospective change) in, the laws (or any
rules or regulations thereunder) of the United States or any
political subdivision, or as a result of any official or
administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment
or change is effective or such pronouncement, action or decision, is
announced on or after the date of issuance of the trust preferred
securities, there is more than an insubstantial risk that we will
not be entitled to treat an amount equal to the liquidation amount
of the trust preferred securities as Tier 1 capital (or the then
equivalent thereof), except as otherwise restricted by the Federal
Reserve Board, for purposes of the risk-based capital

<PAGE>
adequacy guidelines of the Federal Reserve Board, as then in effect
and applicable to us. The Federal Reserve Board has determined that
the proceeds of certain qualifying securities like the trust
preferred securities will qualify as Tier I capital for us only up
to an amount not to exceed, when taken together with all of our
cumulative preferred stock, if any, 25% of our Tier 1 capital.

We or the Trust must request an opinion of counsel with regard
to the matter deemed to be an event within a reasonable period of
time after we or the Trust, as appropriate, become aware of the
possible occurrence of any such event.

REDEMPTION PROCEDURES

If we repay or redeem the junior subordinated debentures, we
must give the property trustee not less than 30 nor more than 60
days' notice in order that it can redeem a proportionate amount of
the preferred and trust common securities. The redemption price for
each trust preferred security shall equal $10 plus accumulated but
unpaid distributions through the redemption date and the related
amount of the premium, if any, paid by us upon the concurrent
redemption of such junior subordinated debentures.

Redemptions of the trust preferred securities will be made and
the redemption price will be payable on each redemption date only to
the extent that the Trust has funds on hand available for the
payment of such redemption price. See also "--Subordination of Trust
Common Securities."

If the Trust gives notice of redemption of the trust preferred
securities, then, by 12:00 noon, Eastern time, on the redemption
date, to the extent funds are available, in the case of trust
preferred securities held in book-entry form, the property trustee
will deposit irrevocably with The Depository Trust Company funds
sufficient to pay the applicable redemption price and will give DTC
irrevocable instructions and authority to pay the redemption price
to you. With respect to trust preferred securities not held in
book-entry form, the property trustee, to the extent funds are
available, will irrevocably deposit with the paying agent for the
trust preferred securities funds sufficient to pay the applicable
redemption price and will give the paying agent irrevocable
instructions and authority to pay the redemption price to you once
you surrender your certificates evidencing the trust preferred
securities. Notwithstanding the foregoing, distributions payable on
or prior to the redemption date for any trust preferred securities
called for redemption will be payable to you on the relevant record
dates for the related distribution dates.

If notice of redemption is given and funds are deposited as
required, then upon the date of such deposit all of your rights with
respect to your trust preferred securities so called for redemption
will cease, except your right to receive the redemption price and
any distributions payable in respect of the trust preferred
securities on or prior to the redemption date, but without interest,
and trust preferred securities that are redeemed will cease to be
outstanding. If any date fixed for redemption of trust preferred
securities is not a business day or is a holiday, then payment of
the redemption price payable on such date will be made on the next
succeeding day which is a business day and not a holiday (without
any interest or other payment in respect of any such delay), except
that, if such business day falls in the next calendar year, such
payment will be made on the immediately preceding business day. In
the event that payment of the redemption price for the trust
preferred securities called for redemption is improperly withheld or
refused and not paid either by the Trust or by us pursuant to the
guarantee as described under "--Description of Guarantee,"
distributions on such trust preferred securities will continue to
accumulate at the then applicable rate, from the redemption date
originally established by the Trust for such trust preferred
securities to the date such redemption price is actually paid, in
which case the actual payment date will be the date fixed for
redemption for purposes of calculating the redemption price.

Subject to applicable law (including, without limitation, United
States federal securities laws), we or our affiliates may from time
to time purchase outstanding trust preferred securities by tender,
in the open market or by private agreement, and may resell such
securities at any time that (a) interest on the junior subordinated
debentures is not being deferred during an extension period, and (b)
there is no event of default or an event that could cause an event
of default under the indenture or an event of default under the
guarantee.

<PAGE>
If less than all the trust preferred securities and trust common
securities are to be redeemed on a redemption date, then the
aggregate liquidation amount of such trust preferred securities and
trust common securities to be redeemed shall be allocated pro rata
to the trust preferred securities and the trust common securities
based upon the relative liquidation amounts of such classes. The
particular trust preferred securities to be redeemed shall be
selected in a manner that the property trustee deems fair, not more
than 60 days prior to the redemption date by the property trustee
from the outstanding trust preferred securities not previously
called for redemption, or in accordance with DTC's customary
procedures if the trust preferred securities are then held in the
form of a global trust preferred security in accordance with DTC's
customary practices. The property trustee shall promptly notify the
securities registrar for the trust preferred securities in writing
of the trust preferred securities selected for redemption and, in
the case of any trust preferred securities selected for partial
redemption, the liquidation amount of the trust preferred securities
to be redeemed. For all purposes of the trust agreement, unless the
context otherwise requires, all provisions relating to the
redemption of trust preferred securities shall relate, in the case
of any trust preferred securities redeemed or to be redeemed only in
part, to the portion of the aggregate liquidation amount of trust
preferred securities which has been or is to be redeemed.

Notice of any redemption will be mailed to you at your address
as it appears on the securities register for the Trust at least 30
days but not more than 60 days before the redemption date if your
trust preferred securities will be redeemed. Unless we default in
payment of the redemption price on the junior subordinated
debentures, on and after the redemption date interest will cease to
accrue on the junior subordinated debentures or portions thereof
called for redemption. Unless payment of the redemption price in
respect of the trust preferred securities is withheld or refused and
not paid either by the Trust or us pursuant to the guarantee,
distributions will cease to accumulate on the trust preferred
securities or portions thereof called for redemption.

SUBORDINATION OF TRUST COMMON SECURITIES

Payment of distributions on, the redemption price of, and the
liquidation distribution in respect of, as described under
"--Liquidation Distribution Upon Dissolution," the trust preferred
securities and trust common securities, as applicable, will be made
pro rata based on the liquidation amount of such trust preferred
securities and trust common securities. However, if on any
distribution date, redemption date or liquidation date an event of
default under the junior subordinated debenture has occurred and is
continuing, no payment of any distribution on, or redemption price
of, or liquidation distribution in respect of, any of the trust
common securities, and no other payment on account of the
redemption, liquidation or other acquisition of such trust common
securities, will be made unless payment in full in cash of all
accumulated and unpaid distributions on all the outstanding trust
preferred securities for all distribution periods terminating on or
prior thereto, or in the case of payment of the redemption price or
a liquidation distribution, the full amount of such redemption price
or liquidation distribution on all the outstanding trust preferred
securities then called for redemption or liquidation, as the case
may be, shall have been made or provided for, and all funds
immediately available to the property trustee shall first be applied
to the payment in full in cash of all distributions on, or
redemption price of, the trust preferred securities then due and
payable.

In the case of any event of default with respect to the trust
preferred securities (as described below under "--Events of Default;
Notice") resulting from an event of default with respect to junior
subordinated debentures (as described below under "Description of
Junior Subordinated Debentures--Debenture Events of Default"), we,
as the holder of the trust common securities, shall have no right to
act with respect to any event of default under the trust agreement
until the effects of all events of default with respect to such
trust preferred securities have been cured, waived or otherwise
eliminated. See "--Events of Default; Notice" and "Description of
Junior Subordinated Debentures--Debenture Events of Default." Until
all events of default under the trust agreement with respect to the
trust preferred securities have been so cured, waived or otherwise
eliminated, the property trustee will act solely on your behalf and
not on our behalf as the holder of the trust common securities, and
only you will have the right to direct the property trustee to act
on your behalf.

<PAGE>
LIQUIDATION DISTRIBUTION UPON DISSOLUTION

The amount payable on the trust preferred securities in the
event of any liquidation of the Trust is $10 per trust preferred
security plus accumulated and unpaid distributions (as long as the
Trust has assets available therefor), subject to certain exceptions,
which may be in the form of a distribution of such amount in junior
subordinated debentures.

We, as the holder of all the outstanding trust common
securities, have the right at any time to dissolve the Trust and,
after satisfaction of liabilities to creditors of the Trust as
provided by applicable law, cause the junior subordinated debentures
to be distributed to you and us, as the holder of the trust common
securities, in liquidation of the Trust.

The Federal Reserve Board's risk-based capital guidelines
currently provide that redemptions of permanent equity or other
capital instruments before stated maturity could have a significant
impact on a bank holding company's overall capital structure and
that any organization considering such a redemption should consult
with the Federal Reserve Board before redeeming any equity or
capital instrument prior to maturity if such redemption could have a
material effect on the level or composition of the organization's
capital base (this consultation may not be necessary if the equity
or capital instrument is redeemed with the proceeds of, or replaced
by, a like amount of a similar or higher quality capital instrument
and the Federal Reserve Board considers the organization's capital
position to be fully adequate after the redemption).

In the event we, while the holder of the trust common
securities, dissolve the Trust prior to the maturity date of the
trust preferred securities and the dissolution of the Trust is
deemed to constitute the redemption of capital instruments by the
Federal Reserve Board under its risk-based capital guidelines or
policies, our dissolution of the Trust may be subject to the prior
approval of the Federal Reserve Board. Moreover, any changes in
applicable law or changes in the Federal Reserve Board's risk-based
capital guidelines or policies could impose a requirement on us to
obtain the prior approval of the Federal Reserve Board to dissolve
the Trust.

Pursuant to the trust agreement, the Trust will automatically
dissolve upon expiration of its term or, if earlier, will dissolve
on the first to occur of:

* certain events of bankruptcy, dissolution or liquidation of us
or another holder of the trust common securities;

* the distribution of a proportionate amount of the junior
subordinated debentures to you and to us, as the holder of the
trust common securities, if we, as the holders of trust common
securities, have given written direction to the property
trustee to dissolve the Trust (which direction, subject to the
foregoing restrictions, is optional and wholly within our
discretion);

* the redemption of all the trust preferred securities and trust
common securities as described under "--Redemption;" and

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

If dissolution of the Trust occurs as described in any of the first,
second and fourth circumstances described above, the Trust will be
liquidated by the property trustee as expeditiously as the property
trustee determines to be possible by distributing, after
satisfaction of liabilities to creditors of the Trust as provided by
applicable law, to you and to us, as holder of the trust common
securities, a proportionate amount of the junior subordinated
debentures, unless such distribution is not practical.

If distribution of the junior subordinated debentures is not
practical, you and the holders of trust preferred securities and
trust common securities will be entitled to receive out of the
assets of the Trust available for distribution to holders, after
satisfaction of liabilities to creditors of the Trust as provided by
applicable law, an amount equal to the aggregate of the liquidation
amount plus accumulated and unpaid distributions thereon to the date
of payment. If such liquidation distribution can be paid only in
part because the Trust has insufficient assets available to pay in
full the aggregate liquidation distribution, then the amounts
payable directly by the Trust on its trust preferred securities
shall be paid on a pro rata basis.

<PAGE>
We, as the holder of the trust common securities, will be
entitled to receive distributions upon any such liquidation pro rata
with you, except that if an event of default under the junior
subordinated debentures has occurred and is continuing, the trust
preferred securities shall have a priority over the trust common
securities. See "--Subordination of Trust Common Securities."

After the liquidation date is fixed for any distribution of
junior subordinated debentures:

* the trust preferred securities will no longer be deemed to be
outstanding;

* DTC or its nominee, as the registered holder of trust
preferred securities, will receive a registered global
certificate or certificate representing the junior
subordinated debentures to be delivered upon such distribution
with respect to trust preferred securities held by DTC or its
nominee; and

* any certificates representing the trust preferred securities
not held by DTC or its nominee will be deemed to represent the
junior subordinated debentures having a principal amount equal
to the stated liquidation amount of the trust preferred
securities and bearing accrued and unpaid interest in an
amount equal to the accumulated and unpaid distributions on
the trust preferred securities until such certificates are
presented to the security registrar for the trust preferred
securities and trust common securities for transfer or
reissuance.

If we do not redeem the junior subordinated debentures prior to
maturity, the Trust is not liquidated and the junior subordinated
debentures are not distributed to you, then the trust preferred
securities will remain outstanding until the repayment of the junior
subordinated debentures and the distribution of the liquidation
distribution to you.

Under current United States federal income tax law and
interpretations and assuming, as expected, that the Trust is treated
as a grantor trust, a distribution of the junior subordinated
debentures should not be a taxable event to you. Should there be a
change in law, a change in legal interpretation, a tax event or
other circumstances, however, the distribution could be a taxable
event to you. If we elect neither to redeem the junior subordinated
debentures prior to maturity nor to liquidate the Trust and
distribute the junior subordinated debentures to you, the trust
preferred securities will remain outstanding until the repayment of
the junior subordinated debentures. See "Certain United States
Federal Income Tax Consequences."

There can be no assurance as to the market prices for the trust
preferred securities or the junior subordinated debentures that may
be distributed in exchange for trust preferred securities if a
dissolution and liquidation of the Trust occurs. Accordingly, the
trust preferred securities that you may purchase, or the junior
subordinated debentures that you may receive on dissolution and
liquidation of the Trust, may trade at a discount to the price that
you paid to purchase the trust preferred securities.

EVENTS OF DEFAULT; NOTICE

Any one of the following events constitutes an event of default
under the trust agreement with respect to the trust preferred
securities (whatever the reason for such event of default and
whether it is voluntary or involuntary or effected by operation of
law or pursuant to a judgment, decree or order of any court or any
order, rule or regulation of any administrative or governmental
body):

* the occurrence of a event of default with respect to the
junior subordinated debentures (see "Description of Junior
Subordinated Debentures--Debenture Events of Default");

* default by the Trust in the payment of any distribution when
it becomes due and payable, and continuation of such default
for a period of 30 days;

* default by the Trust in the payment of any redemption price of
any trust preferred security or trust common security when it
becomes due and payable;

* default in the performance, or breach, in any material
respect, of any covenant or warranty of the trustees in the
trust agreement (other than a covenant or warranty a default
in the performance of which or the breach of which is dealt
with in either the second or third bulleted clause above), and
continuation of such default or breach for a period of 60 days
after there has been given, by registered or certified mail,
to the trustees and us by the holders of at least 25% in
aggregate

<PAGE>
liquidation amount of the outstanding trust preferred
securities, a written notice specifying such default or breach
and requiring it to be remedied and stating that such notice
is a "Notice of Default" under the trust agreement; or

* the occurrence of certain events of bankruptcy or insolvency
with respect to the property trustee if a successor property
trustee has not been appointed within 60 days thereof.

Within five business days after the occurrence of any event of
default actually known to the property trustee, the property trustee
will transmit notice of the event of default to you, as the holder
of the trust preferred securities, and to us, as the holder of the
trust common securities, and the administrators, unless the event of
default has been cured or waived. We, as depositor, and the
administrators are required to file annually with the property
trustee a certificate as to whether or not we are in compliance with
all the conditions and covenants applicable to us under the trust
agreement.

If an event of default with respect to the junior subordinated
debentures has occurred and is continuing, the trust preferred
securities will have a preference over the trust common securities
with respect to payments of any amounts as described above. The
existence of an event of default does not entitle holders of the
trust preferred securities to accelerate the maturity of the trust
preferred securities unless the default is caused by an event of
default with respect to the junior subordinated debentures and both
the debenture trustee and holders of at least 25% in aggregate
liquidation amount of the junior subordinated debentures fail to
accelerate the maturity thereof. See "--Subordination of Trust
Common Securities," "--Liquidation Distribution Upon Dissolution"
and "Description of Junior Subordinated Debentures--Debenture Events
of Default."

REMOVAL OF TRUSTEES; APPOINTMENT OF SUCCESSORS

The holders of a majority in aggregate liquidation amount of the
outstanding trust preferred securities may remove any trustee (but
not any administrator) for cause at any time, or with or without
cause, if an event of default with respect to the junior
subordinated debentures has occurred and is continuing. If a trustee
is removed by the holders of the outstanding trust preferred
securities, the successor may be appointed by the holders of at
least 25% in aggregate liquidation amount of trust preferred
securities. If a trustee resigns, such trustee will appoint its
successor. If a trustee fails to appoint a successor, the holders of
at least 25% in aggregate liquidation amount of the outstanding
trust preferred securities may appoint a successor. If a successor
has not been appointed by the holders, any holder of trust preferred
securities or trust common securities or the other trustee may
petition a court in the State of Delaware to appoint a successor.
Any Delaware trustee must meet the applicable requirements of
Delaware law. Any property trustee must be a national or
state-chartered bank and have capital and surplus of at least
$50,000,000. No resignation or removal of a trustee and no
appointment of a successor trustee shall be effective until the
acceptance of appointment by the successor trustee in accordance
with the provisions of the trust agreement. You do not have any
right to appoint, remove or replace the administrators of the Trust.
Only we, as holder of the trust common securities, have these
rights.

MERGER OR CONSOLIDATION OF TRUSTEES

Any entity into which the property trustee or the Delaware
trustee may be merged or converted or with which it may be
consolidated, or any entity resulting from any merger, conversion or
consolidation to which such trustee is a party, or any entity
succeeding to all or substantially all the corporate trust business
of such trustee, will be the successor of such trustee under the
trust agreement, provided such entity is otherwise qualified and
eligible.

MERGERS, REPLACEMENTS OR SIMILAR TRANSACTIONS OF THE TRUST

The Trust may not merge with, be replaced by, convey its assets
substantially as an entirety to, or engage in any similar
transaction with any entity except as described below or as otherwise
set forth in the trust agreement. The Trust may, at our request as
the holder of the trust common securities, and with the consent of
the holders of a majority aggregate liquidation amount of the
outstanding trust preferred securities, the property trustee and the
Delaware trustee, merge with or into, consolidate, amalgamate, or be

<PAGE>
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to a trust organized as such under the
laws of any state, so long as:

* such successor entity (1) expressly assumes all the
obligations of the Trust with respect to the trust preferred
securities or (2) substitutes for the trust preferred
securities other securities having substantially the same
terms as the trust preferred securities so long as the
substitute securities have the same priority as the trust
preferred securities with respect to distributions and
payments upon liquidation, redemption and otherwise and which
are then listed or listed upon notification of issuance on any
national securities exchange or automated quotation system on
which the trust preferred securities are then listed;

* a trustee of such successor entity, possessing the same powers
and duties as the property trustee, is appointed to hold the
junior subordinated debentures;

* such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not cause the trust
preferred securities (including any substitute securities) to
be downgraded by any nationally recognized statistical rating
organization, if then rated;

* such merger, replacement, conveyance or similar transaction
does not adversely affect the rights, preferences and
privileges of the holders of the trust preferred securities
(including any substitute securities) in any material respect;

* such successor entity has a purpose substantially identical to
that of the Trust;

* prior to such merger, replacement, conveyance or similar
transaction, the Trust has received an opinion from
independent counsel experienced in such matters to the effect
that (1) such merger, replacement, conveyance or similar
transaction does not adversely affect your rights, preference
and privileges as a holder of trust preferred securities (or
substitute securities) in any material respect, and (2)
following such merger, replacement, conveyance or similar
transaction, neither the Trust nor such successor entity will
be required to register as an investment company under the
Investment Company Act; and

* we or any permitted successor or assignee own all the trust
common securities of such successor entity and guarantee the
obligations of such successor entity under the successor
securities at least to the extent provided by the guarantee.

Notwithstanding the foregoing, the Trust may not, except with the
consent of holders of 100% in aggregate liquidation amount of the
trust preferred securities, merge with, be replaced by, or convey
its assets substantially as an entirety to, or engage in any similar
transaction with, any other entity if such merger, replacement,
conveyance or similar transaction would cause the Trust or the
successor entity to be classified as other than a grantor trust for
United States federal income tax purposes.

VOTING RIGHTS; AMENDMENT OF TRUST AGREEMENT

Except as provided above and under "--Removal of Trustees;
Appointment of Successors" and "Description of Guarantee--Amendments
and Assignment," as provided below and as otherwise required by law
and the trust agreement, you will have no voting rights.

We, as the holder of the trust common securities, the property
trustee and the administrators may amend the trust agreement from
time to time, without your consent, to:

* cure any ambiguity, correct or supplement any provisions in
the trust agreement that may be inconsistent with any other
provision, or to make any other provisions with respect to
matters or questions arising under the trust agreement,
provided that any such amendment does not adversely affect in
any material respect your interests; or

* modify, eliminate or add to any provisions of the trust
agreement to such extent as may be necessary to ensure that
the Trust will be classified as a grantor trust for United
States federal income tax purposes at any time that any trust
preferred securities or trust common securities are
outstanding or

<PAGE>
to ensure that the Trust will not be required to register as
an investment company under the Investment Company Act.

Any such amendments of the trust agreement will become effective
when notice of such amendment is given to the holders of trust
preferred securities and trust common securities.

We, as the holder of the trust common securities, the property
trustee and the administrators may amend the trust agreement from
time to time with:

* the consent of holders representing a majority in aggregate
liquidation amount of the trust preferred securities; and

* receipt by the trustees of an opinion of counsel to the effect
that such amendment or the exercise of any power granted to
the trustees in accordance with such amendment will not affect
the Trust's status as a grantor trust for United States
federal income tax purposes or the Trust's exemption from
status as an investment company under the Investment Company
Act.

However, without the consent of each holder of trust preferred
securities or trust common securities affected thereby, the trust
agreement may not be amended to:

* change the amount or timing of any distribution on the trust
preferred securities or trust common securities or otherwise
adversely affect the amount of any distribution required to be
made in respect of the trust preferred securities or trust
common securities as of a specified date; or

* restrict your right or our right, as the holder of the trust
common securities, to institute suit for the enforcement of
any such payment on or after such date.

So long as any junior subordinated debentures are held by the
Trust, the property trustee will not:

* direct the time, method and place of conducting any proceeding
for any remedy available to the debenture trustee, or execute
any trust or power conferred on the property trustee with
respect to the junior subordinated debentures;

* waive any past default that is waivable pursuant to the terms
of the indenture;

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

* consent to any amendment, modification or termination of the
indenture or the junior subordinated debentures, where such
consent shall be required, without, in each case, obtaining
the prior approval of the holders of a majority in aggregate
liquidation amount of the trust preferred securities, or, if a
consent under the indenture would require the consent of each
holder of junior subordinated debentures affected thereby, no
such consent will be given by the property trustee without the
prior consent of each holder of the trust preferred
securities.

The property trustee may not revoke any action previously
authorized or approved by a vote of the holders of the trust
preferred securities except by subsequent vote of the holders of the
trust preferred securities. In addition to obtaining your approval
as described above, before taking any of the actions listed above,
the property trustee will obtain an opinion of counsel experienced
in such matters to the effect that the Trust will not fail to be
classified as a grantor trust for United States federal income tax
purposes on account of such action.

Your vote or consent will not be required to redeem and cancel
trust preferred securities in accordance with the trust agreement.

Notwithstanding that you and other holders of trust preferred
securities are entitled to vote or consent under any of the
circumstances described above, any of the trust preferred securities
that are owned by us, the trustees or any of our respective
affiliates will, for purposes of such vote or consent, be treated as
if they were not outstanding.

<PAGE>
EXPENSES AND TAXES

Through the trust agreement, the indenture and the guarantee
agreement, we have agreed to pay all debts and other obligations
(other than distributions on the trust preferred securities) and all
costs and expenses of the Trust (including costs and expenses
relating to the organization of the Trust, the fees and expenses of
the trustees and the costs and expenses relating to the operation of
the Trust) and to pay any and all taxes and all costs and expenses
(other than United States withholding taxes) to which the Trust
might become subject. These obligations of ours are for the benefit
of, and shall be enforceable by, any creditor of the Trust to whom
any of these debts, obligations, costs, expenses and taxes are owed
whether or not such creditor has received notice thereof. Any such
creditor may enforce these obligations directly against us, and we
have irrevocably waived any right or remedy to require that any
creditor take any action against the Trust or any other person
before proceeding against us. We also have agreed in the indenture
to execute such additional agreements as may be necessary or
desirable to give full effect to the foregoing.

BOOK ENTRY, DELIVERY AND FORM

The trust preferred securities will be issued in the form of one
or more fully registered global securities, which will be deposited
with, or on behalf of, DTC and registered in the name of a DTC
nominee. Unless and until it is exchangeable in whole or in part for
the trust preferred securities in definitive form, a global security
may not be transferred except as a whole by DTC to a nominee of DTC
or by a nominee of DTC to DTC or to another nominee of DTC or by DTC
or any such nominee to a successor of DTC or to a nominee of such
successor.

Ownership of beneficial interests in a global security will be
limited to participants that have accounts with DTC or its nominee
or persons that may hold interests through such participants. We
expect that, upon the issuance of a global security, DTC will
credit, on its book-entry registration and transfer system, the
participants' accounts with their respective principal amounts of
trust preferred securities represented by such global security.
Ownership of beneficial interests in such global security will be
shown on, and the transfer of such ownership interests will be
effected only through, records maintained by DTC (with respect to
the interests of participants) and on the records of participants
(with respect to your interests). You will not receive written
confirmation from DTC of your purchase, but are expected to receive
written confirmations from participants through which you entered
into the transaction. Transfers of ownership interests will be
accomplished by entries on the books of participants acting on your
behalf.

So long as DTC, or its nominee, is the registered owner of a
global security, DTC or such nominee, as the case may be, will be
considered the sole owner or holder of the trust preferred
securities represented by such global security for all purposes
under the trust agreement. Except as provided below, you are the
owner of beneficial interests in a global security and will not be
entitled to receive physical delivery of the trust preferred
securities in definitive form. You will not be considered an owner
or holder under the trust agreement. Accordingly, you must rely on
the procedures of DTC and, if you are not a participant, on the
procedures of the participant through which you own your interest,
to exercise any rights as a holder of trust preferred securities
under the trust agreement. We understand that, under DTC's existing
practices, in the event that we request any action of you, or if you
desire to take any action which a holder of trust preferred
securities is entitled to take under the trust agreement, DTC would
authorize the participants holding your interests to take such
action, and such participants would authorize you to take such
action or would otherwise act upon your instructions. Redemption and
other notices also will be sent to DTC. If less than all of the
trust preferred securities are being redeemed, we understand that it
is DTC's existing practice to determine by lot the amount of the
interest of each participant to be redeemed. Therefore, as long as
the trust preferred securities are held in book-entry form,
references in this prospectus to your rights and benefits mean your
indirect interest held through DTC. You should consider the
procedures of DTC with respect to distributions, redemptions,
notice, voting and similar rights and benefits, as well as those
described in this prospectus.

Distributions on the trust preferred securities registered in
the name of DTC or its nominee will be made to DTC or its nominee,
as the case may be, as the registered owner of the global security
representing such trust preferred securities. Neither the trustees,
nor the administrators, any paying agent or any other

<PAGE>
agent of ours or the trustees will have any responsibility or
liability for any aspect of the records relating to or payments made
on account of beneficial ownership interests in the global security
for such trust preferred securities or for maintaining, supervising
or reviewing any records relating to such beneficial ownership
interests. Disbursements of distributions to participants shall be
the responsibility of DTC. DTC's practice is to credit participants'
accounts on a payable date in accordance with their respective
holdings shown on DTC's records unless DTC has reason to believe
that it will not receive payment on the payable date. Payments by
participants to you will be governed by standing instructions and
customary practices, as is the case with securities held for the
accounts of customers in bearer form or registered in "street name,"
and will be the responsibility of such participant and not of DTC,
us, the trustees, the paying agent or any other agent of ours,
subject to any statutory or regulatory requirements as may be in
effect from time to time. The laws of some states require that
certain purchasers of securities take physical delivery of their
purchased securities in definitive form. Such limits and laws may
impair the ability to transfer beneficial interests in the global
security.

DTC may discontinue providing its services as securities
depository with respect to the trust preferred securities at any
time by giving reasonable notice to us or the trustees. If DTC
notifies us that it is unwilling to continue as such, or if it is
unable to continue or ceases to be a clearing agency registered
under the Exchange Act and a successor depository is not appointed
by us within 90 days after receiving such notice or becoming aware
that DTC is no longer so registered, we will issue the trust
preferred securities in definitive form upon registration of,
transfer of, or in exchange for, such global security. In addition,
we may at any time and in our sole discretion determine not to have
the trust preferred securities represented by one or more global
securities and, in such event, will issue trust preferred securities
in definitive form in exchange for all of the global securities
representing such trust preferred securities. Finally, holders of a
majority in liquidation amount of trust preferred securities may
determine to discontinue the system of book-entry transfers through
DTC following an event of default with respect to the trust
preferred securities.

DTC has advised the Trust and us as follows:

* DTC is a limited purpose trust company organized under the
laws of the State of New York, a "banking organization" within
the meaning of New York banking law, a member of the Federal
Reserve Board, a "clearing corporation" within the meaning of
the Uniform Commercial Code and a "clearing agency" registered
pursuant to the provisions of Section 17A of the Exchange Act;

* DTC was created to hold securities for its participants and to
facilitate the clearance and settlement of securities
transactions between participants through electronic book
entry changes to accounts of its participants, thereby
eliminating the need for physical movement of certificates;

* participants include securities brokers and dealers (such as
the underwriters), banks, trust companies and clearing
corporations and may include certain other organizations;

* certain of such participants (or their representatives),
together with other entities, own DTC; and

* indirect access to the DTC system is available to others such
as banks, brokers, dealers and trust companies that clear
through, or maintain a custodial relationship with, a
participant, either directly or indirectly.

PAYMENT AND PAYING AGENCY

Payments in respect of the trust preferred securities will be
made to DTC, which will credit the relevant accounts at DTC on the
applicable distribution dates or, if the trust preferred securities
are not held by DTC, such payments will be made by check mailed to
the address of the holder entitled thereto such address appears on
the securities register for the trust preferred securities. The
paying agent will initially be the property trustee. The paying
agent will be permitted to resign as paying agent upon 30 days'
written notice to the property trustee and the administrators. If
the property trustee is no longer the paying agent, the property
trustee is to appoint a successor (which must be a bank or trust
company reasonably acceptable to the administrators) to act as
paying agent.

<PAGE>
REGISTRAR AND TRANSFER AGENT

The property trustee will act as registrar and transfer agent
for the trust preferred securities.

Registration of transfers of trust preferred securities will be
effected without charge by or on behalf of the Trust, but only upon
payment of any tax or other governmental charges that may be imposed
in connection with any transfer or exchange. The Trust will not be
required to register or cause to be registered the transfer of the
trust preferred securities after the trust preferred securities have
been called for redemption.

OBLIGATIONS AND DUTIES OF THE PROPERTY TRUSTEE

The property trustee, other than during the occurrence and
continuance of an event of default, undertakes to perform only such
duties as are specifically set forth in the trust agreement and the
Trust Indenture Act and, after such event of default, must exercise
the same degree of care and skill as a prudent person would exercise
or use in the conduct of his or her own affairs. Subject to this
provision, the property trustee is under no obligation to exercise
any of the powers vested in it by the trust agreement at your
request, unless offered by you reasonable indemnity against the
costs, expenses and liabilities that might be incurred by the
exercise of these powers. The property trustee is not required to
expend or risk its own funds or otherwise incur any financial
liability in the performance of its duties if it has reasonable
grounds to believe that repayment or adequate indemnity is not
assured to it.

Prior to the occurrence of an event of default, the property
trustee may rely upon any certificates or opinions furnished to it
and conforming to the requirements of the trust agreement.

For information concerning the relationships between Bankers
Trust Company, the property trustee, and us, see "Description of
Junior Subordinated Debentures--Information Concerning the Debenture
Trustee."

MISCELLANEOUS

The administrators and the property trustee are authorized and
directed to conduct the affairs of and to operate the Trust in such
a way that (1) the Trust will not be deemed to be an "investment
company" required to be registered under the Investment Company Act
or be classified as other than a grantor trust taxable as a
corporation for United States federal income tax purposes and (2)
the junior subordinated debentures will be treated as our
indebtedness for United States federal income tax purposes. In this
connection, the property trustee and we and the administrators are
authorized to take any action not inconsistent with applicable law,
the certificate of trust of the Trust or the trust agreement that
the property trustee and we, as the holder of the trust common
securities, and the administrators, determine in their discretion to
be necessary or desirable for such purposes, as long as such action
does not materially adversely affect your interests.

You will not have preemptive or similar rights.

GOVERNING LAW

The trust agreement will be governed by and construed in
accordance with the laws of the State of Delaware.

<PAGE>
DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES

We will issue the junior subordinated debentures under the
indenture between Bankers Trust Company, the debenture trustee, and
us. This summary of certain terms and provisions of the junior
subordinated debentures and the indenture is not complete. You
should read the form of the indenture that is filed as an exhibit to
the registration statement of which this prospectus is a part.
Whenever particular defined terms of the indenture are referred to
in this prospectus, such defined terms are incorporated herein by
reference. A copy of the form of indenture is available from the
debenture trustee upon request. In addition, the indenture will be
qualified under the Trust Indenture Act of 1939. The terms of the
junior subordinated debentures include those made a part of the
indenture by the Trust Indenture Act. This summary is qualified by
reference to the Trust Indenture Act and you should be familiar with
its provisions.

GENERAL

Concurrently with the issuance of the trust preferred
securities, the Trust will invest the proceeds, together with the
consideration paid by us for the trust common securities, in the
junior subordinated debentures issued by us. The aggregate principal
amount of the junior subordinated debentures will be limited to the
aggregate liquidation amount of the trust preferred securities and
trust common securities. The junior subordinated debentures will be
unsecured and will rank junior and be subordinate in right of payment
to all of our senior indebtedness and other subordinated indebtedness.
The junior subordinated debentures will not be subject to a sinking
fund. The indenture does not limit our ability to incur or issue
other secured or unsecured debt, including senior indebtedness and
other subordinated indebtedness, whether under the junior subordinated
debentures or any existing or other indenture that we may enter into
in the future or otherwise. See "--Subordination." In addition,
because we are a holding company, our right to participate in any
distribution of assets by any of our subsidiaries upon a
subsidiary's liquidation or similar event is subject to the prior
claims of creditors of that subsidiary, except to the extent we are
recognized as a creditor of that subsidiary. Our obligations under
the junior subordinated debentures are effectively subordinated to
all existing and future liabilities of our subsidiaries. The junior
subordinated debentures will bear interest, accruing from August 2,
1999, at the annual rate of 9.875% of the principal amount thereof, payable
quarterly in arrears on March 31, June 30, September 30 and December 31
of each year, commencing September 30, 1999, to the person in whose name
each junior subordinated debenture is registered at the close of business
on the 15th day of the month of such interest payment date. It is
anticipated that, unless the Trust is liquidated, each junior
subordinated debenture will be registered in the name of the Trust
and held by the property trustee in trust for you and the holders of
the trust common securities.

The amount of interest payable for any full interest period will
be computed by dividing the annual rate by four. The amount of
interest payable for any period less than a full interest period
will be computed on the basis of a 360-day year of twelve 30-day
months and the actual days elapsed in a partial month in such
period. If any date on which interest is payable to the junior
subordinated debentures is not a business day or is a holiday, then
payment of the interest payable on such date will be made on the
next business day that is not a holiday (without any interest or
other payment in respect of any such delay), or, if such business
day falls in the next calendar year, such payment will be made on
the immediately preceding business day in each case with the same
force and effect as if made on the date such payment was originally
payable.

Accrued interest that is not paid on the applicable interest
payment date will bear additional interest on the amount thereof (to
the extent permitted by law) at the annual rate of 9.875%, compounded
quarterly.

The term "interest" includes quarterly interest payments,
interest on quarterly interest payments not paid on the applicable
interest payment date and, if applicable, any additional sums we pay
on the junior subordinated debentures following a tax event (as
defined under "Description of Trust Preferred Securities--Redemption")
that may be required so that distributions payable by the Trust will not
be reduced by any additional taxes, duties or other governmental changes.

The junior subordinated debentures will mature on August 2, 2029,
subject to our right to shorten the maturity date once at any time
to any date not earlier than August 2, 2004, if we have received prior
approval of the Federal Reserve Board if then required under applicable
capital guidelines or policies of the

<PAGE>
Federal Reserve Board. In the event we elect to shorten the maturity
of the junior subordinated debentures, we will give notice to the
registered holders of the junior subordinated debentures, the
debenture trustee and the Trust of such shortening no less than
90 days prior to the effectiveness thereof.

OPTION TO EXTEND INTEREST PAYMENT PERIOD

So long as no event of default under the indenture has occurred
and is continuing, we have the right at any time during the term of
the junior subordinated debentures to defer the payment of interest
at any time for a period (a) not exceeding 20 consecutive quarterly
periods with respect to each extension period, (b) that does not
extend beyond the stated maturity of the junior subordinated
debentures and (c) that does not end on a date other than an
interest payment date. During any extension period we have the right
to make partial payments of interest on any interest payment date.
At the end of an extension period, we must pay all interest then
accrued and unpaid. During an extension period, interest will
continue to accrue and holders of junior subordinated debentures
(and holders of trust preferred securities while outstanding) will
be required to accrue and recognize interest income for United
States federal income tax purposes. See "Certain United States
Federal Income Tax Consequences--Interest Income and Original Issue
Discount."

During any extension period, we may not:

* make any payment of principal of or interest or premium, if
any, on or repay, repurchase or redeem any of our debt
securities that rank equally with or junior in interest to the
junior subordinated debentures; or

* redeem, purchase or acquire less than all of the junior
subordinated debentures or any trust preferred securities; or

* declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect
to, any of our capital stock, except that we may:

(a) repurchase, redeem or make other acquisitions of shares of
our capital stock in connection with any employment
contract, benefit plan or other similar arrangement in
connection with a dividend reinvestment or shareholder
stock purchase plan or in connection with the issuance of our
capital stock (or securities convertible into or exercisable
for such capital stock) as consideration in any acquisition
transactions announced at least 30 days prior to any extension
period;

(b)take any necessary action in connection with any
reclassification, exchange or conversion of any class or
series of our capital stock (or any capital stock of a
subsidiary of ours) for any class or series of our capital
stock;

(c)purchase fractional interests in shares of our capital
stock pursuant to the conversion or exchange provisions of
such capital stock or the security being converted or
exchanged;

(d)declare a dividend in connection with any shareholders'
rights plan, or issue rights, stock or other property under
any shareholders' rights plan, or redeem or repurchase
rights pursuant thereto; or

(e)declare a dividend in the form of stock, warrants, options
or other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options or other
rights is the same stock as that on which the dividend is
being paid or ranks equally with or junior to such stock.

Prior to the termination of any extension period, we may extend
the extension period (subject to the limits imposed on the duration
and ending date of an extension period) further deferring the
payment of interest as long as no event of default under the
indenture has occurred and is continuing. Upon the termination of
any extension period and the payment of all amounts then due, we may
elect to begin a new extension period subject to the above
conditions. No interest will be due and payable during an extension
period, except at its end. We must give the holders of the junior
subordinated debentures and the debenture trustee notice of our
election of such extension period at least one business day prior to
the earlier of (1) the next succeeding date the distribution on the
trust preferred securities would have been payable but for the
election to begin an extension period and (2) the date the property
trustee is required to give you notice of

<PAGE>
the record date or the date such distribution is payable, but in
any event not less than one business day prior to such record date.
The debenture trustee will give you prompt notice of our election
to begin an extension period. Subject to the foregoing, there is no
limitation on the number of times that we may elect to begin an
extension period.

REDEMPTION

We may redeem the junior subordinated debentures prior to
maturity at our option (1) on or after August 2, 2004, in whole
at any time or in part from time to time, or (2) in whole, but not in
part, at any time within 90 days following the occurrence and during
the continuation of a tax event, investment company event or capital
treatment event (each as defined under "Description of Trust Preferred
Securities--Redemption"), in each case at a redemption price equal to
the outstanding principal amount of the junior subordinated debentures
plus accrued interest to the redemption date. The proceeds of any such
redemption will be used by the Trust to redeem the trust preferred securities.

The Federal Reserve Board's risk-based capital guidelines, which
are subject to change, currently provide that redemptions of
permanent equity or other capital instruments before stated maturity
could have a significant impact on a bank holding company's overall
capital structure and that any organization considering such a
redemption should consult with the Federal Reserve Board before
redeeming any equity or capital instrument prior to maturity if such
redemption could have a material effect on the level or composition
of the organization's capital base. Consultation may not be
necessary if the equity or capital instrument was redeemed with the
proceeds of, or replaced by, a like amount of a similar or higher
quality capital instrument and the Federal Reserve Board considers
the organization's capital position to be fully adequate after the
redemption.

If we redeem the junior subordinated debentures prior to their
stated maturity, such redemption would constitute the redemption of
capital instruments under the Federal Reserve Board's current
risk-based capital guidelines and may be subject to the prior
approval of the Federal Reserve Board. The redemption of the junior
subordinated debentures also could be subject to the additional
prior approval of the Federal Reserve Board under its current
risk-based capital guidelines.

ADDITIONAL SUMS

We have covenanted in the indenture that, if and for so long as
the Trust is the holder of all junior subordinated debentures and
the Trust is required to pay any additional taxes, duties or other
governmental charges as a result of a tax event, we will pay as
additional sums on the junior subordinated debentures such amounts
as may be required so that the distributions payable by the Trust
will not be reduced as a result of any such additional taxes, duties
or other governmental charges. See "Description of Trust Preferred
Securities--Redemption."

REGISTRATION, DENOMINATION AND TRANSFER

The junior subordinated debentures will initially be registered
in the name of the Trust. If the junior subordinated debentures are
distributed to you, it is anticipated that the depositary
arrangements for the junior subordinated debentures will be
substantially identical to those in effect for the trust preferred
securities. See "Description of Trust Preferred Securities--Book
Entry, Delivery and Form."

Although DTC has agreed to the procedures described in
"Description of Trust Preferred Securities--Book Entry, Delivery and
Form," it is under no obligation to perform or continue to perform
such procedures, and such procedures may be discontinued at any
time. If DTC is at any time unwilling or unable to continue as
depositary and we do not appoint a successor depositary within 90
days of receipt of notice from DTC to such effect, we will cause the
junior subordinated debentures to be issued in definitive form.

Payments on junior subordinated debentures represented by a
global security will be made to Cede & Co., the nominee for DTC, as
the registered holder of the junior subordinated debentures,
described under "Description of Trust Preferred Securities--Book
Entry, Delivery and Form." If junior subordinated

<PAGE>
debentures are issued in certificated form, principal and interest will
be payable, the transfer of the junior subordinated debentures will
be registerable, and junior subordinated debentures will be
exchangeable for junior subordinated debentures of other authorized
denominations of a like aggregate principal amount, at the corporate
trust office of the debenture trustee in New York, New York, or at
the offices of any paying agent or transfer agent we appoint, provided
that payment of interest may be made at our option by check
mailed to the address of the persons entitled thereto. However, a
holder of $1.00 million or more in aggregate principal amount of
junior subordinated debentures may receive payments of interest
(other than interest payable at the stated maturity) by wire
transfer of immediately available funds upon written request to the
debenture trustee not later than 15 calendar days prior to the date
on which the interest is payable.

Junior subordinated debentures are issuable only in registered
form without coupons in integral multiples of $10. Junior
subordinated debentures will be exchangeable for other junior
subordinated debentures of like tenor, of any authorized
denominations, and of a like aggregate principal amount.

Junior subordinated debentures may be presented for exchange as
provided above, and may be presented for registration of transfer
(with the form of transfer endorsed thereon, or a satisfactory
written instrument of transfer, duly executed), at the office of the
securities registrar appointed under the indenture or at the office
of any transfer agent we designate for such purpose without service
charge and upon payment of any taxes and other governmental charges
as described in the indenture. We will appoint the debenture trustee
as securities registrar under the indenture.

In the event of any redemption, we will not, nor will the
debenture trustee be required to:

* issue, register the transfer of or exchange junior
subordinated debentures during a period beginning at the
opening of business 15 days before the day of selection for
redemption of the junior subordinated debentures to be
redeemed and ending at the close of business on the day of
mailing of the relevant notice of redemption; or

* register the transfer of or exchange any junior subordinated
debentures so selected for redemption, except, in the case of
any junior subordinated debentures being redeemed in part, any
portion of the debenture not to be redeemed.

Any monies deposited with the debenture trustee or any paying
agent, or then held by us in trust, for the payment of the principal
of (and premium, if any) or interest on any junior subordinated
debenture and remaining unclaimed for two years after this principal
(and premium, if any) or interest has become due and payable shall,
at our request, be repaid to us and the holder of such junior
subordinated debenture must look, as a general unsecured creditor,
only to us for payment thereof.

RESTRICTIONS ON CERTAIN PAYMENTS; CERTAIN COVENANTS

We have covenanted that at any time (1) there has occurred any
event (a) of which we have actual knowledge that with the giving of
notice or the lapse of time, or both, would constitute an event of
default under the indenture and (b) that we have not taken
reasonable steps to cure, (2) there has occurred an event of default
under the indenture, (3) if the junior subordinated debentures are
held by the Trust, we are in default with respect to our payment of
any obligations under the guarantee, or (4) we have given notice of
our election of an extension period as provided in the indenture and
have not rescinded such notice, or such extension period, or any
extension thereof, is continuing, then we will not:

* make any payment of principal of or interest or premium, if
any, on or repay, repurchase or redeem any of our debt
securities that rank equally in all respects with, or junior
in interest to, the junior subordinated debentures; or

* redeem, purchase or acquire less than all of the junior
subordinated debentures or any trust preferred securities; or

<PAGE>
* declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect
to, any of our capital stock, except that we may:

(a) repurchase, redeem or make other acquisitions of shares
of our capital stock in connection with any employment
contract, benefit plan or other similar arrangement with or
for the benefit of any one or more employees, officers,
directors or consultants, in connection with a dividend
reinvestment or shareholder stock purchase plan or in
connection with the issuance of our capital stock (or securities
convertible into or exercisable for such capital stock) as
consideration in any acquisition transactions announced at least
30 days prior to any extension period;

(b) take any necessary action in connection with any
reclassification, exchange or conversion of any class or
series of our capital stock (or any capital stock of any
subsidiary of ours) for any class or series of our capital
stock;

(c) purchase fractional interests in shares of our capital
stock pursuant to the conversion or exchange provisions of
such capital stock or the security being converted or
exchanged;

(d) declare a dividend in connection with any shareholders'
rights plan, or issue rights, stock or other property under
any shareholders' rights plan, or redeem or repurchase
rights pursuant thereto; or

(e) declare a dividend in the form of stock, warrants, options
or other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options or other
rights is the same stock as that on which the dividend is
being paid or ranks equally with or junior to such stock.

We have covenanted in the indenture:

* to continue to hold, directly or indirectly, 100% of the trust
common securities, provided that certain successors that are
permitted pursuant to the indenture may succeed to our
ownership of the trust common securities;

* as holder of the trust common securities, not to voluntarily
terminate, windup or liquidate the Trust, other than:

(a) in connection with a distribution of junior subordinated
debentures to the holders of the trust preferred securities
in liquidation of the Trust; or

(b) in connection with certain mergers, consolidations or
amalgamations permitted by the trust agreement; and

* to use reasonable efforts, consistent with the terms and
provisions of the trust agreement, to cause the Trust to
continue to be classified as a grantor trust for United States
federal income tax purposes.

MODIFICATION OF INDENTURE

From time to time, we as well as the debenture trustee may,
without the consent of any of the holders of the outstanding junior
subordinated debentures, amend, waive or supplement the provisions
of the indenture to:

* evidence the succession of another corporation or association
and the assumption by such person of our obligations under the
junior subordinated debentures;

* add further covenants, restrictions or conditions for the
protection of holders of the junior subordinated debentures or
to surrender any right or power conferred upon us under the
indenture;

* cure any ambiguity, to correct or supplement any provision in
the indenture that may be defective or inconsistent with any
other provision in the indenture, or to make any other
provisions with respect to matters or questions arising under
the indenture, provided that such action shall not adversely
affect the interest of the holders of the trust preferred
securities and the trust common securities in any material
respect or, in the case of the securities issued to the Trust
and for so long as any of the trust preferred securities
issued by the Trust shall remain outstanding, the holders of
such trust preferred securities;

<PAGE>

* change the terms of the junior subordinated debentures to
facilitate the issuance of the junior subordinated debentures
in certificated or other definitive form;

* evidence or provide for the appointment of a successor
debenture trustee;

* qualify, or maintain the qualification of, the indenture under
the Trust Indenture Act;

* convey, transfer, assign, mortgage, pledge any property to or
with the debenture trustee or to surrender any right or power
conferred upon us by the indenture;

* add any additional events of default under the indenture for
the benefit of the holders of the trust preferred securities
and the trust common securities; or

* change or eliminate any of the provisions of the indenture,
provided that any such change or elimination shall not apply
to any outstanding securities.

The indenture contains provisions permitting the debenture
trustee and us, with the consent of the holders of a majority in
principal amount of the junior subordinated debentures, to modify
the indenture in a manner affecting the rights of the holders of the
junior subordinated debentures. However, none of these modifications
may be made, without the consent of the holder of each outstanding
junior subordinated debenture so affected, that would:

* change the stated maturity of, or any installment of interest
on, the junior subordinated debentures, or reduce the
principal amount, the rate of interest or any premium payable
upon its redemption, or change the place of payment where, or
the currency in which, any such amount is payable, or impair
the right to institute suit for the enforcement of any payment
on the junior subordinated debentures; or

* reduce the percentage of principal amount of junior
subordinated debentures, the holders of which are required to
consent to any modification of, or waiver of rights under, the
indenture.

Furthermore, so long as any of the trust preferred securities
remain outstanding, no modification may be made that adversely
affects you in any material respect, and no termination of the
indenture may occur, and no waiver of any event of default or
compliance with any covenant under the indenture may be effective,
without the prior consent of the holders of a majority of the
aggregate liquidation amount of the outstanding trust preferred
securities unless and until the principal of (and premium, if any,
on) the junior subordinated debentures and all accrued and unpaid
interest have been paid in full and certain other conditions are
satisfied.

DEBENTURE EVENTS OF DEFAULT

The indenture provides that any one or more of the following
described events with respect to the junior subordinated debentures
that has occurred and is continuing constitute an "event of default"
with respect to the junior subordinated debentures:

* failure to pay any interest on the junior subordinated
debentures when due and continuance of this default for a
period of 30 days (subject to the deferral of any due date in
the case of an extension period);

* failure to pay any principal of or premium, if any, on the
junior subordinated debentures when due whether at the stated
maturity or otherwise;

* failure to observe or perform any of the other covenants
contained in the indenture for 90 days after written notice of
such failure to us from the debenture trustee or the holders
of at least 25% in aggregate outstanding principal amount of
the outstanding junior subordinated debentures; or

* the occurrence of the appointment of a receiver or other
similar official in any liquidation, insolvency or similar
proceeding with respect to us or all or substantially all of
our property; or a court or other governmental agency enters a
decree or order appointing a receiver or similar official and
such decree or order remains unstayed and undischarged for a
period of 60 days.

<PAGE>
As described in "Description of Trust Preferred
Securities--Events of Default; Notice," the occurrence of an event
of default in respect of the junior subordinated debentures also
will constitute an event of default in respect of the trust
preferred securities and trust common securities.

Subject to certain limitations, the holders of a majority in
aggregate principal amount of outstanding junior subordinated
debentures have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the debenture
trustee. The debenture trustee or the holders of not less than 25%
in aggregate principal amount of outstanding junior subordinated
debentures may declare the principal due and payable immediately upon
an event of default, and, should the debenture trustee or such
holders of junior subordinated debentures fail to make such declaration,
the holders of at least 25% in aggregate liquidation amount of the
outstanding trust preferred securities shall have such right. The
holders of a majority in aggregate principal amount of outstanding
junior subordinated debentures may annul such declaration and waive
the default if all defaults (other than the non-payment of the principal
of junior subordinated debentures which has become due solely by such
acceleration) have been cured and a sum sufficient to pay all matured
installments of interest and principal due otherwise than by acceleration
and all sums paid or advanced by the debenture trustee and the reasonable
compensation, expenses, disbursements and advances of the debenture
trustee, its agent and its counsel has been deposited with the debenture
trustee. Should the holders of junior subordinated debentures fail to
annul such declaration and waive such default, the holders of a majority
in aggregate liquidation amount of the outstanding trust preferred
securities shall have such right.

We are required to certify annually to the debenture trustee as
to whether or not we are in compliance with all the conditions and
covenants applicable to us under the indenture.

ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF TRUST PREFERRED SECURITIES

If an event of default has occurred and is continuing and such
event is attributable to our failure to pay any amounts payable in
respect of the junior subordinated debentures on the date such
amounts are otherwise payable, you may institute a legal action
against us to enforce the payment to you of an amount equal to the
amount payable in respect of junior subordinated debentures having a
principal amount equal to the aggregate liquidation amount of the
trust preferred securities you hold. We may not amend the indenture
to remove the foregoing right to bring such legal action without
your prior written consent. We will have the right under the
indenture to set-off of any payment we make to you in connection
with such a legal action.

As a holder of trust preferred securities, you will not be able
to exercise directly any remedies available to the holders of the
junior subordinated debentures except under the circumstances
described in the preceding paragraph unless there has been an event
of default under the trust agreement. See "Description of Trust
Preferred Securities--Events of Default; Notice."

CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS

The indenture provides that we may not consolidate with or merge
into any other entity or convey, transfer or lease our properties
and assets substantially as an entirety to any entity, and no entity
may consolidate with or merge into us or convey, transfer or lease
its properties and assets substantially as an entirety to us,
unless:

* in the event we consolidate with or merge into another entity
or convey or transfer our properties and assets substantially
as an entirety to any entity, the successor entity is
organized under the laws of the United States or any state or
the District of Columbia, and such successor entity expressly
assumes our obligations in respect of the junior subordinated
debentures; provided, however, that nothing in the indenture
shall be deemed to restrict or prohibit, and no supplemental
indenture shall be required in the case of the merger of a
bank (as defined below) with and into a bank or us, the
consolidation of banks into a bank or us, or the sale or other
disposition of all or substantially all of the assets of any
bank to another bank or us, if, in any such case in which we
are not the surviving, resulting or acquiring entity, we would
own, directly or indirectly, at least 80% of the voting
securities

<PAGE>
of the bank (and of any other bank any voting securities of
which are owned, directly or indirectly, by such bank)
surviving such merger, resulting from such consolidation
or acquiring such assets;

* immediately after giving effect thereto, no event of default
with respect to the junior subordinated debentures, and no
event which, after notice or lapse of time or both, would
constitute an event of default with respect to the junior
subordinated debentures, has occurred and is continuing; and

* certain other conditions as prescribed in the indenture are
satisfied.

For purposes of the first bullet point above, the term "bank"
means each of:

* any banking subsidiary of ours the consolidated assets of
which constitute 20% or more of our consolidated assets;

* any other banking subsidiary designated as a bank pursuant to
a board resolution and set forth in an officers' certificate
delivered to the trustee; and

* any subsidiary of ours that owns, directly or indirectly, any
voting securities, or options, warrants or rights to subscribe
for or purchase voting securities, of any bank under the first
and second bullet points above and in the case of all three
bullet points above their respective successors (whether by
consolidation, merger, conversion transfer of substantially
all their assets and business or otherwise) so long as any
such successor is a banking subsidiary (in the case of the
first and second bullet point or a subsidiary (in the case of
the third bullet point) of ours.

The provisions of the indenture do not afford holders of the
junior subordinated debentures protection in the event we are
involved in a highly leveraged or other transaction that may
adversely affect holders of the junior subordinated debentures.

SATISFACTION AND DISCHARGE

The indenture will cease to be of further effect and we will be
deemed to have satisfied and discharged the indenture when:

* all junior subordinated debentures have been delivered to the
debenture trustee for cancellation, or all junior subordinated
debentures not previously delivered to the debenture trustee
for cancellation (1) have become due and payable, or (2) will
become due and payable at the stated maturity within one year
or (3) are to be called for redemption within one year under
arrangements satisfactory to the debenture trustee;

* we deposit or cause to be deposited with the debenture trustee
funds, in trust, for the purpose and in an amount sufficient
to pay and discharge the entire indebtedness on the junior
subordinated debentures not previously delivered to the
debenture trustee for cancellation, for the principal (and
premium, if any) and interest to the date of the deposit or to
the stated maturity or redemption date; and

* we have paid all other sums payable by us under the indenture
and we have delivered applicable certificates and opinions of
counsel that indicate we have complied with all of our
obligations.

SUBORDINATION

The junior subordinated debentures generally will be subordinate
and junior in right of payment, to the extent set forth in the
indenture, to all of our senior indebtedness or other subordinated
indebtedness (as defined below). If we default in the payment of any
principal, premium, if any, or interest, if any, or any other amount
payable on any senior or other subordinated indebtedness when the
same becomes due and payable whether at maturity or at a date fixed
for redemption or by declaration of acceleration or otherwise, then
unless and until such default has been cured or waived or has ceased
to exist or all senior indebtedness has been paid, no direct or
indirect payment (in cash, property, securities, by set-off or
otherwise) may be made or agreed to be made on the junior
subordinated debentures, or in respect of any redemption repayment,
retirement, purchase or other acquisition of any of the junior
subordinated debentures.

<PAGE>

As used herein, "senior indebtedness or other subordinated
indebtedness" means, whether recourse is to all or a portion of our
assets and whether or not contingent:

* every obligation of ours for money borrowed;

* every obligation of ours evidenced by bonds, debentures, notes
or other similar instruments, including obligations incurred
in connection with the acquisition of property, assets or
businesses;

* every reimbursement obligation of ours with respect to letters
of credit, bankers' acceptances or similar facilities issued
for our account;

* every obligation of ours issued or assumed as the deferred
purchase price of property or services (but excluding trade
accounts payable or accrued liabilities arising in the
ordinary course of business);

* every capital lease obligation of ours;

* every obligation of ours for claims (as defined in Section
101(4) of the United States Bankruptcy Code of 1978, as
amended) in respect of derivative products such as interest
foreign exchange rate contracts, commodity contracts and
similar arrangements; and

* every obligation of the type referred to above of another
person and all dividends of another person the payment of
which, in either case, we have guaranteed or are responsible
or liable, directly or indirectly, as obligor or otherwise.

However, senior indebtedness and other subordinated indebtedness
shall not include any of the following:

* any obligations which, by their terms, are expressly stated to
rank equally in right of payment with, or to not be superior
in right of payment to, the junior subordinated debentures;

* any of our senior indebtedness and other subordinated
indebtedness which when incurred and without respect to any
election under Section 1111(b) of the United States Bankruptcy
Code of 1978, as amended, was without recourse to us;

* any indebtedness of ours to any of our subsidiaries;

* indebtedness, other than indebtedness for wages or bank
deposits, payable to executive officers, directors or employees;

* any indebtedness which by its terms is subordinated to trade
accounts payable or accrued liabilities arising in the
ordinary course of business to the extent that payments made
to the holders of such indebtedness by the holders of the
junior subordinated debentures because of the debentures'
subordination provisions exceed amounts to which the obligees
of such indebtedness would be entitled under the subordination
provisions to which such debt is entitled; and

* any indebtedness in respect of debt securities issued to any
trust, or a trustee of such trust, partnership or other entity
affiliated with us that is a financing entity of ours in
connection with the issuance by such financing entity of
securities that are similar to the trust preferred securities.

As of March 31, 1999, our senior indebtedness and other
subordinated indebtedness was approximately $87.31 million. All
senior indebtedness (including any interest thereon accruing after
the commencement of any such proceedings) must first be paid in full
before any payment or distribution, whether in cash, securities or
other property, is made on account of the junior subordinated
debentures in the event of:

* any insolvency, bankruptcy, receivership, liquidation,
reorganization, readjustment, imposition or other similar
proceedings relating to us, our creditors or our property;

* any proceeding for our liquidation, dissolution or other
winding up, voluntary or involuntary, whether or not involving
insolvency or bankruptcy proceedings;

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

* any other marshaling of our assets.

<PAGE>
In such event, any payment or distribution on account of the junior
subordinated debentures, whether in cash, securities or other
property, that would otherwise (but for the subordination
provisions) be payable or deliverable in respect of the junior
subordinated debentures will be paid as described above directly to
the holders of senior indebtedness in accordance with the priorities
then existing among such holders until all senior indebtedness and
other subordinated indebtedness (including any interest accruing
after the commencement of any such proceedings) has been paid in
full.

In the event of any proceeding described above, after payment in
full of all sums owing with respect to our senior indebtedness and
other subordinated indebtedness, the holders of junior subordinated
debentures, together with the holders of our obligations ranking on
a parity with the junior subordinated debentures, will be entitled
to be paid from our remaining assets the amounts at the time due and
owing on the junior subordinated debentures and such other
obligations. This payment will be made before any payment or other
distribution, whether in cash, property or otherwise, will be made
on account of any capital stock or obligations ranking junior to the
junior subordinated debentures and such other obligations. If
payment or distribution on account of the junior subordinated
debentures of any character or security, whether in cash, securities
or other property, is received by any holder of any junior
subordinated debentures in contravention of any of the terms of the
indenture and before all our senior indebtedness has been paid in
full, such payment or distribution or security will be received in
trust for the benefit of, and must be paid over or delivered and
transferred to, the holders of our senior indebtedness at the time
outstanding in accordance with the priorities then existing among
such holders for application to the payment of all senior
indebtedness remaining unpaid to the extent necessary to pay all
such senior indebtedness in full.

By reason of such subordination, in the event of our insolvency,
holders of senior indebtedness and other subordinated indebtedness
may receive more, ratably, and holders of the junior subordinated
debentures may receive less, ratably, than our other creditors. Such
subordination will not prevent the occurrence of any event of
default in respect of the junior subordinated debentures.

The indenture places no limitation on the amount of additional
senior indebtedness and other subordinated indebtedness that we may
incur. We expect from time to time to incur additional senior
indebtedness and other subordinated indebtedness.

INFORMATION CONCERNING THE DEBENTURE TRUSTEE

The debenture trustee, other than during the occurrence and
continuance of a default in the performance of our obligations under
the junior subordinated debentures, is under no obligation to
exercise any of the powers vested in it by the indenture at the
request of any holder of junior subordinated debentures, unless
offered reasonable indemnity by such holder against the costs,
expenses and liabilities that might be incurred by the exercise of
these powers. The debenture trustee is not required to expend or
risk its own funds or otherwise incur personal financial liability
in the performance of its duties if the debenture trustee reasonably
believes that repayment or adequate indemnity is not reasonably
assured to it.

The debenture trustee may rely and shall be protected in acting
or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, security or other paper or document
believed by it to be genuine and to have been signed or presented by
the proper party or parties. The debenture trustee may consult with
counsel of its choice and the advice of such counsel or any opinion
of such counsel shall be full and complete authorization and
protection in respect of any action taken in reliance thereon.

Bankers Trust Company, the debenture trustee, may serve from
time to time as trustee under other indentures or trust agreements
with us or our subsidiaries relating to other issues of our
securities. In addition, we as well as certain of our affiliates may
have other banking relationships with Bankers Trust Company and its
affiliates.

GOVERNING LAW

The indenture and the junior subordinated debentures will be
governed by and construed in accordance with the laws of the State
of New York.

<PAGE>
DESCRIPTION OF GUARANTEE

We will execute and deliver the guarantee concurrently with the
issuance of preferred securities by the Trust for your benefit.
Bankers Trust Company will act as guarantee trustee under the
guarantee and will hold the guarantee for your benefit. This summary
of certain provisions of the guarantee is not complete. You should
read the form of the guarantee, which is filed as an exhibit to the
registration statement of which this prospectus is a part. Whenever
particular defined terms of the guarantee are referred to in this
prospectus, such terms are incorporated herein by reference. A copy
of the form of guarantee is available upon request from the
guarantee trustee. The guarantee will be qualified as an indenture
under the Trust Indenture Act. This summary is qualified by
reference to the Trust Indenture Act and you should be familiar with
its provisions.

GENERAL

We will irrevocably agree to pay in full on a subordinated
basis, to the extent set forth in the guarantee and described
herein, the payments described below to you, as and when due,
regardless of any defense, right of set-off or counterclaim that the
Trust may have or assert other than the defense of payment. The
following payments with respect to the trust preferred securities,
to the extent not paid by or on behalf of the Trust, will be subject
to the guarantee:

* any accumulated and unpaid distributions required to be paid
on the trust preferred securities, to the extent that the
Trust has funds available for their payment at such time;

* the redemption price with respect to any trust preferred
securities called for redemption, to the extent that the Trust
has funds available for its payment at such time; and

* upon a voluntary or involuntary dissolution, termination,
winding up or liquidation of the Trust (unless the junior
subordinated debentures are distributed to you and the other
holders of the trust preferred securities), the lesser of:

(a)the aggregate of the liquidation amount and all accumulated
and unpaid distributions to the date of payment, to the
extent that the Trust has funds available for their
payment; and

(b)the amount of assets of the Trust remaining available for
distribution to you on liquidation of the Trust.

Our obligation to make a guarantee payment may be satisfied by
directly paying you or by causing the Trust to pay you.

The guarantee will be an irrevocable, subordinated guarantee of
payment on a subordinated basis of the Trust's obligations under the
trust preferred securities. The guarantee will apply only to the
extent that the Trust has funds sufficient to make such payments. If
we do not make payments on the junior subordinated debentures held
by the Trust, the Trust will not be able to pay any amounts payable
in respect of the trust preferred securities and will not have funds
available for these payments. The guarantee will rank subordinate
and junior in right of payment to all of our senior indebtedness and
all of our other subordinated indebtedness. See "--Status of the
Guarantee."

STATUS OF THE GUARANTEE

The guarantee will constitute our unsecured obligation and will
rank subordinate and junior in right of payment to all of our senior
indebtedness and subordinated indebtedness in the same manner as the
junior subordinated debentures. The guarantee does not limit our
ability to incur or issue other secured or unsecured senior or
subordinated indebtedness. In addition, because we are a holding
company, our right to participate in any distribution of assets by
any of our subsidiaries upon a subsidiary's liquidation or similar
event is subject to the prior claims of the creditors of the
subsidiary except to the extent we are recognized as a creditor of
that subsidiary. Our obligations under the guarantee are effectively
subordinated to all existing and future liabilities of any of our
subsidiaries and their respective subsidiaries.

The guarantee will constitute a guarantee of payment and not of
collection. A guarantee of payment entitles the guarantee trustee or
you to institute a legal proceeding directly against us as the guarantor
to enforce your rights under the guarantee without first instituting
a legal proceeding against the Trust or any

<PAGE>

other person or entity. The guarantee will be held by the guarantee
trustee for your benefit. The guarantee will not be discharged except
by paying the amounts required under the guarantee in full to the extent
not paid by the Trust or distributing the junior subordinated debentures
to you.

AMENDMENTS AND ASSIGNMENT

Except with respect to any changes that do not materially
adversely affect your rights (in which case no consent will be
required), the guarantee may not be amended without the prior
approval of the holders of a majority of the aggregate liquidation
amount of the outstanding trust preferred securities. The manner of
obtaining any such approval is set forth under "Description of Trust
Preferred Securities--Voting Rights; Amendment of Trust Agreement."
All guarantees and agreements contained in the guarantee will bind
our successors, assigns, receivers, trustees and representatives and
will inure to your benefit and the benefit of all of the holders of
the trust preferred securities then outstanding.

EVENTS OF DEFAULT

An event of default under the guarantee will occur if we fail to
perform any of our payment or other obligations under the guarantee,
or fail to perform any non-payment obligation if our failure remains
unremedied for 30 days. If an event of default occurs the guarantee
trustee must enforce your rights under the guarantee. The holders of
a majority in aggregate liquidation amount of the outstanding trust
preferred securities have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the
guarantee trustee under the guarantee or to direct the guarantee
trustee to exercise any trust or power conferred upon the guarantee
trustee under the guarantee.

In addition to acts taken by the guarantee trustee, you may
institute a legal proceeding directly against us to enforce your
rights under the guarantee without first instituting a legal
proceeding against the Trust, the guarantee trustee or any other
person or entity. Since you will not be the record holder of the
trust preferred securities while they are in book-entry form, you
will have to observe the procedures of DTC to take such action. See
"Description of Trust Preferred Securities--Book Entry, Delivery and
Form."

We are required, as guarantor, to certify annually to the
guarantee trustee whether or not we are in compliance with all the
conditions and covenants applicable to us under the guarantee.

INFORMATION CONCERNING THE GUARANTEE TRUSTEE

The guarantee trustee, other than during a default by us in
performance of the guarantee, undertakes to perform only duties that
are set forth in the guarantee. After the occurrence of an event of
default with respect to the guarantee, the guarantee trustee must
enforce the guarantee and must exercise the same degree of care and
skill as a prudent person would exercise or use in the conduct of
his or her own affairs. The guarantee trustee is under no obligation
to expend or risk its own funds or otherwise incur any financial
liability in the performance of its duties if it has reasonable
grounds to believe that repayment or adequate indemnity is not
assured.

For information concerning our relationship with Bankers Trust
Company, as guarantee trustee, see "Description of Junior
Subordinated Debentures--Information Concerning the Debenture
Trustee."

TERMINATION OF THE GUARANTEE

The guarantee will terminate and be of no further force and
effect upon full payment of the redemption price of the trust
preferred securities, upon full payment of the amounts payable with
respect to the trust preferred securities upon liquidation of the
Trust, or upon distribution of junior subordinated debentures to you
and the other holders of the trust preferred securities in exchange
for all of the trust preferred securities. The guarantee will
continue to be effective or will be reinstated, as the case may be,
if at any time you must restore payment of any sums paid to you
under the trust preferred securities or the guarantee.

GOVERNING LAW

The guarantee will be governed by and construed in accordance
with the laws of the State of New York.

<PAGE>

RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES, THE JUNIOR
SUBORDINATED DEBENTURES AND THE GUARANTEE

FULL AND UNCONDITIONAL GUARANTEE

We have irrevocably guaranteed, on a subordinate basis, payments
of distributions and other amounts due on the trust preferred
securities (to the extent that Trust has funds available for such
payment) to the extent set forth under "Description of Guarantee."
Taken together, our obligations under the junior subordinated
debentures, the indenture, the trust agreement and the guarantee
provide, in the aggregate, a full, irrevocable and unconditional
guarantee of payments of distributions and other amounts due on the
trust preferred securities. No single document standing alone or
operating in conjunction with fewer than all the other documents
constitutes such guarantee. It is only the combined operation of
these documents that has the effect of providing a full, irrevocable
and unconditional guarantee of the Trust's obligations in respect of
the trust preferred securities.

If and to the extent that we do not make payments on the junior
subordinated debentures, the Trust will not have sufficient funds to
pay distributions or other amounts due on the trust preferred
securities. The guarantee does not cover payment of amounts payable
with respect to the trust preferred securities when the Trust does
not have sufficient funds to pay such amounts. In such event, your
remedy is to institute a legal proceeding directly against us for
enforcement of our payment obligations under the junior subordinated
debentures having a principal amount equal to the liquidation amount
of the trust preferred securities you hold.

Our obligations under the junior subordinated debentures and the
guarantee are subordinate and junior in right of payment to all of our
senior indebtedness and other subordinated indebtedness. An event of
default under any of our senior indebtedness or other subordinated
indebtedness would not constitute an event of default in respect of
the trust preferred securities. However, in the event of payment
defaults under, or acceleration of, our senior indebtedness or other
subordinated indebtedness, the subordination provisions of the
indenture provide that no payments may be made in respect of the
junior subordinated debentures until such senior indebtedness or
other subordinated indebtedness has been paid in full or any payment
default on senior indebtedness or other subordinated indebtedness
has been cured or waived. See "Description of Junior Subordinated
Debentures--Subordination." Failure to make required payments on the
junior subordinated debentures would constitute an event of default
in respect of the trust preferred securities.

SUFFICIENCY OF PAYMENTS

As long as we make the payments on the junior subordinated
debentures when they are due, such payments will be sufficient to
cover distributions and other payments distributable on the trust
preferred securities, primarily because:

* the aggregate principal amount of the junior subordinated
debentures will be equal to the sum of the aggregate stated
liquidation amount of the trust preferred securities and trust
common securities;

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

* we will pay for any and all costs, expenses and liabilities of
the Trust except the Trust's obligations to you and to us, as
the holder of the trust common securities, to pay amounts due
under the trust preferred securities and the trust common
securities, respectively; and

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

Notwithstanding anything to the contrary in the indenture, we
have the right to set-off any payment we are otherwise required to
make thereunder against and to the extent we have previously made,
or are concurrently making, a payment under the guarantee.

<PAGE>

ENFORCEMENT RIGHTS OF HOLDERS OF TRUST PREFERRED SECURITIES

You may institute a legal proceeding directly against us to
enforce your rights under the guarantee without first instituting a
legal proceeding against the guarantee trustee, the Trust or any
other person or entity. See "Description of Guarantee."

RIGHTS TO DISTRIBUTIONS

The trust preferred securities represent preferred undivided
beneficial interests in the assets of the Trust, and the Trust
exists for the sole purposes of issuing the trust preferred
securities and trust common securities and investing the proceeds
from their issuance in the junior subordinated debentures and
engaging in other activities necessary, convenient or incidental
thereto. A principal difference between your rights as a holder of
trust preferred securities and a holder of a junior subordinated
debenture is that a holder of a junior subordinated debenture is
entitled to receive from us payments on the junior subordinated
debentures held, while you are entitled to receive distributions or
other amounts distributable with respect to the trust preferred
securities from the Trust (or from us under the guarantee) only if
and to the extent the Trust has funds available for the payment of
such distributions.

RIGHTS UPON DISSOLUTION

Upon any voluntary or involuntary dissolution of the Trust,
other than any dissolution involving the distribution of the junior
subordinated debentures to you and the other holders of the trust
preferred securities, and after satisfaction of liabilities to
creditors of the Trust as required by applicable law, you will be
entitled to receive, out of assets held by the Trust, the
liquidation distribution in cash. See "Description of Trust
Preferred Securities--Liquidation Distribution Upon Dissolution." If
we are voluntarily or involuntarily liquidated or declare
bankruptcy, the Trust, as registered holder of the junior
subordinated debentures, will be our subordinated creditor,
subordinated and junior in right of payment to all our senior
indebtedness or other subordinated indebtedness as set forth in the
indenture, but entitled to receive payment in full of all amounts
payable with respect to the junior subordinated debentures before
any of our shareholders receive payments or distributions. Since we
are the guarantor under the guarantee and have agreed under the
indenture to pay for all costs, expenses and liabilities of the
Trust (other than the Trust's obligations to you and the holders of
the trust common securities), your position as a holder of the trust
preferred securities and the position of a holder of such junior
subordinated debentures relative to other creditors and to our
shareholders in the event of our liquidation or bankruptcy are
expected to be substantially the same.

<PAGE>
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

GENERAL

In the opinion of Thompson Coburn LLP, St. Louis, Missouri, our
counsel, the following discussion fairly summarizes the material
United States federal income tax consequences of the purchase,
ownership, and disposition of the trust preferred securities.

The following discussion is general and may not apply to your
particular circumstances for any of the following (or other)
reasons:

* This summary is based on United States federal income tax laws
in effect as of the date of this prospectus, including
applicable regulations and administrative and judicial
interpretations. Changes to any of these laws, regulations or
interpretations after this date may affect the tax
consequences described below, possibly on a retroactive basis.

* This summary discusses only trust preferred securities you
acquire at original issuance at the original offering price
and hold as capital assets (within the meaning of federal tax
law). It does not discuss all of the tax consequences that may
be relevant to, beneficial owners who are subject to special
rules, such as banks, thrift institutions, real estate
investment trusts, regulated investment companies, insurance
companies, brokers and dealers in securities or currencies,
certain securities traders, tax-exempt organizations and
certain other financial institutions. This discussion also
does not discuss tax consequences that may be relevant to an
owner in light of the owner's particular circumstances, such
as an owner holding a trust preferred security as a position
in a straddle, hedging, conversion or other integrated
investment.

* This summary does not address:

(a)The income tax consequences to stockholders in, or partners
of beneficiaries of, a holder of trust preferred
securities;

(b)the United States alternative minimum tax consequences of
purchasing, owning and disposing of trust preferred
securities; or

(c)any state, local or foreign tax consequences of purchasing,
owning and disposing of trust preferred securities.

The authorities on which this summary is based are subject to
various interpretations, and the opinions of Thompson Coburn LLP are
not binding on the Internal Revenue Service, or the courts, either
of which could take a contrary position. Moreover, no rulings have
been or will be sought from the Service with respect to the
transaction described herein. Accordingly, we cannot assure you that
the Service will not challenge the opinion expressed herein or that
a court would not sustain such a challenge.

We advise you to consult your own tax advisors regarding the tax
consequences of purchasing, owning and disposing of the trust
preferred securities based on your particular circumstances and the
relevant taxing jurisdictions.

UNITED STATES HOLDERS

IN GENERAL. For purposes of the following discussion, a "United
States Holder" means:

* a citizen or individual resident of the United States;

* a corporation or partnership created or organized in or under
the laws of the United States or any political subdivision
thereof;

* an estate the income of which is includible in its gross
income for United States federal income tax purposes without
regard to its source; or

* a trust if a court within the United States is able to
exercise primary supervision over its administration and at
least one United States person has the authority to control
all substantial decisions of the trust.

<PAGE>
CHARACTERIZATION OF THE TRUST. Prior to the time that the trust
preferred securities are issued, Counsel will opine that (1) under
then current law and based on the representations, facts and
assumptions set forth in this prospectus, (2) assuming full
compliance with the terms of the trust agreement (and other relevant
documents), and (3) based on certain assumption and qualifications
referred to in the opinion, the Trust should be characterized for
United States federal income tax purposes as a grantor trust.
Accordingly, for United States federal income tax purposes, if you,
as a United States Holder, purchase a trust preferred security you
should be considered the owner of an undivided interest in the
junior subordinated debentures owned by the Trust, and you should be
required to include all income or gain recognized for United States
federal income tax purposes with respect to your share of the junior
subordinated debentures on your income tax return.

INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT. Under the terms of
the junior subordinated debentures, we have the ability to defer
payments of interest from time to time by extending the interest
payment period for a period not exceeding 20 consecutive quarterly
periods, but not beyond the maturity of the junior subordinated
debentures. Assuming that the junior subordinated debentures are
issued at face value and the likelihood of deferring interest
payments is "remote" within the meaning of applicable Treasury
regulations, the junior subordinated debentures will not be
considered issued with original issue discount ("OID").

We conclude that, as of the date of this prospectus, the
likelihood of our deferring payments of interest is "remote" within
the meaning of the applicable Treasury regulations. This conclusion
is based in part on the fact that exercising that option would
prevent us from declaring dividends on our common stock and would
prevent us from making any payments with respect to debt securities
that rank equally with or junior to the junior subordinated
debentures. Therefore, the junior subordinated debentures should not
be treated as issued with OID by reason of our deferral option
alone. Rather, you will be taxed on stated interest on the junior
subordinated debentures when such interest is paid or accrued in
accordance with your method of accounting for income tax purposes.
You should note, however, that no published rulings or any other
published authorities of the Service have addressed this issue.
Accordingly, we cannot assure you that the Service will not
challenge this conclusion or that a court would not sustain such a
challenge.

In the event we exercise our option to defer payments of
interest, the junior subordinated debentures would be treated as
redeemed and reissued for OID purposes. The sum of the remaining
interest payments (and any de minimus OID) on the junior
subordinated debentures would thereafter be treated as OID. The OID
would accrue, and be includible in your taxable income, on a daily
accrual basis (regardless of your method of accounting for income
tax purposes) over the remaining term of the junior subordinated
debentures (including any period of interest deferral), without
regard to the timing of payments under the junior subordinated
debentures. Subsequent distributions of interest on the junior
subordinated debentures generally would not be taxable. The amount
of OID that would accrue in any period would generally equal the
amount of interest that accrued on the junior subordinated
debentures in that period at the stated interest rate. Consequently,
during any period of interest deferral, you will include OID in
gross income in advance of the receipt of cash, and if you dispose
of a trust preferred security prior to the record date for payment
of distributions on the junior subordinated debentures following
that period, you will be subject to income tax on OID accrued
through the date of disposition (and not previously included in
income), but you will not receive cash from the Trust with respect
to the OID.

If our exercise of our option to defer payments of interest is
not treated as remote, the junior subordinated debentures would be
treated as initially issued with OID in an amount equal to the
aggregate stated interest (plus any de minimus OID) over the term of
the junior subordinated debentures. You would include that OID in
your taxable income, over the term of the junior subordinated
debentures, on a daily accrual basis.

CHARACTERIZATION OF INCOME. Because the income underlying the
trust preferred securities should not be characterized as dividends
for income tax purposes, a corporate holder of the trust preferred
securities will not be entitled to a dividends-received deduction
for any income recognized with respect to the trust preferred
securities.

MARKET DISCOUNT AND BOND PREMIUM. If you are not the initial
purchaser of the trust preferred securities or if you are the
initial purchaser but you do not purchase at the original offering
price, you may

<PAGE>
be considered to have acquired your undivided interest in the junior
subordinated debentures with market discount or bond premium (as
each phrase is defined for United States federal income tax
purposes). In this situation, you need to contact your own tax
advisor to determine your particular tax consequences.

RECEIPT OF JUNIOR SUBORDINATED DEBENTURES OR CASH UPON
LIQUIDATION OF THE TRUST. Under certain circumstances described
above (see "Description of Trust Preferred Securities--Liquidation
Distribution Upon Dissolution"), the Trust may distribute the junior
subordinated debentures to you in exchange for your trust preferred
securities and in liquidation of the Trust. Except as discussed
below, such a distribution would not be a taxable event for United
States federal income tax purposes, and you would have an aggregate
adjusted basis in the junior subordinated debentures you receive for
United States federal income tax purposes equal to your aggregate
adjusted basis in your trust preferred securities. For United States
federal income tax purposes, your holding period in the junior
subordinated debentures you receive in such a liquidation of the
Trust would include the period during which you held the trust
preferred securities. If, however, the relevant event is a tax event
as described in "Description of Trust Preferred Securities--
Redemption," which results in the Trust being treated as an
association taxable as a corporation, the distribution would likely
constitute a taxable event to you for United States federal income
tax purposes.

Under certain circumstances described herein (see "Description
of Trust Preferred Securities"), we may redeem junior subordinated
debentures for cash and distribute the proceeds of such redemption
to you in redemption of your trust preferred securities. Such a
redemption would be taxable for United States federal income tax
purposes, and you would recognize gain or loss as if you had sold
the trust preferred securities for cash. See "--Sales of Trust
Preferred Securities" below.

SALES OF TRUST PREFERRED SECURITIES. If you sell your trust
preferred securities, you will recognize gain or loss equal to the
difference between your adjusted basis in the trust preferred
securities and the amount realized on the sale of such trust
preferred securities. Your adjusted basis in the trust preferred
securities generally will be the initial purchase price, increased
by OID previously included (or currently includible) in your gross
income to the date of disposition, and decreased by payments
received on the trust preferred securities (other than any interest
received with respect to the period prior to the effective date we
first exercise our option to defer payments of interest). Any such
gain or loss generally will be capital gain or loss, and generally
will be a long-term capital gain or loss if you have held the trust
preferred securities for more than one year prior to the date of
disposition.

If you dispose of your trust preferred securities between record
dates for payments of distributions thereon, you will be required to
include accrued but unpaid interest (or OID) on the junior
subordinated debentures through the date of disposition in your
taxable income for United States federal income tax purposes
(notwithstanding that you may receive a separate payment from the
purchaser with respect to accrued interest). You may deduct that
amount from the sales proceeds received (including the separate
payment, if any, with respect to accrued interest) for the trust
preferred securities (or as to OID only, to add such amount to your
adjusted tax basis in the trust preferred securities). To the extent
the selling price is less than your adjusted tax basis (which will
include accrued but unpaid OID if any), you will recognize a capital
loss. Subject to certain limited exceptions, capital losses
generally cannot be applied to offset ordinary income for United
States federal income tax purposes.

PENDING TAX LITIGATION AFFECTING THE TRUST PREFERRED SECURITIES

Last year, a taxpayer filed a petition in the United States Tax
Court contesting the Service's disallowance of interest deductions
that the taxpayer claimed in respect of securities issued in 1993
and 1994 that are, in some respects, similar to the trust preferred
securities. (Enron Corp. v. Commissioner, Docket No. 6149-98, filed
April 1, 1998). The matter is still pending before the Tax Court. An
adverse decision by the Tax Court concerning the deductibility of
such interest may cause a tax event, giving us the right to redeem
the junior subordinated debentures. See "Description of Junior
Subordinated Debentures--Redemption" and "Description of Trust Preferred
Securities--Liquidation Distribution Upon Dissolution."

NON-UNITED STATES HOLDERS

The following discussion applies to you if you are not a United
States Holder as described above.

<PAGE>
Payments of interest, including OID, to you, as a non-United
States Holder, on a trust preferred security will generally not be
subject to withholding of United States federal income tax, provided
that:

* you did not (directly or indirectly, actually or
constructively) own 10% or more of the total combined voting
power of all classes of our stock entitled to vote;

* you are not a controlled foreign corporation that is related
to us through stock ownership;

* the interest does not constitute contingent interest as
described in Section 871(h)(4) of the Internal Revenue Code of
1986, as amended (the "Code");

* you are not a bank receiving interest described in Section
881(c)(3)(A) of the Code; and

* either (a) you certify to the Trust or its agent (or other
applicable payor), under penalties of perjury and in
accordance with applicable Treasury regulations, that you are
not a United States Holder and provide your name and address,
or (b) a securities clearing organization, bank or other
financial institution that holds customers' securities in the
ordinary course of its trade or business (a "Financial
Institution"), and holds the trust preferred security in such
capacity, certifies to the Trust or its agent (or other
applicable payor), under penalties of perjury and in
accordance with applicable Treasury regulations, that it
requires and has received such a statement from you or another
Financial Institution between it and you in the chain of
ownership, and furnishes the Trust or its agent (or other
applicable payor) with a copy thereof.

Recently finalized Treasury regulations, that are generally
effective with respect to payments made after December 31, 2000,
would provide alternative methods for satisfying the certification
requirements described above.

It is possible that changes in the law affecting the income tax
consequences of the junior subordinated debentures could adversely
affect our ability to deduct interest payable on the junior
subordinated debentures. Such changes could also cause the junior
subordinated debentures to be classified as our equity (rather than
our debt) for United States federal income tax purposes. This might
cause the income derived from the junior subordinated debentures to
be characterized as dividends, generally subject to a 30% income tax
(on a withholding basis) when paid to you if you are not a United
States Holder, rather than as interest which, as discussed above,
generally is exempt from income tax in the hands of a person who is
not a United States Holder.

You, as a non-United States Holder, will generally not be
subject to withholding of income tax on any gain realized upon the
sale or other disposition of a trust preferred security.

If you hold the trust preferred securities in connection with
the active conduct of a United States trade or business, you will be
subject to income tax on all income and gains recognized with
respect to your proportionate share of the junior subordinated
debentures.

INFORMATION REPORTING

In general, information reporting requirements will apply to
payments of any interest or premium on, and proceeds from the sale
of, the trust preferred securities within the United States to, and
to the accrual of OID on trust preferred securities with respect to,
a non-corporate United States Holder. In addition, payments made on,
and payments of the proceeds from the sale of, the trust preferred
securities to or through the United States office of a broker are
subject to information reporting unless you certify as to your
non-United States Holder status or otherwise establish an exemption
from information reporting and backup withholding. See "--Backup
Withholding." Taxable income on the trust preferred securities for a
calendar year should be reported to United States Holders on the
appropriate forms by the following January 31st.

BACKUP WITHHOLDING

Payments of any interest or premium on, proceeds from the sale
of, and the accrual of OID on, the trust preferred securities may be
subject to a "backup" withholding tax of 31% unless you comply with
certain identification or exemption requirements. Any amounts so
withheld will be allowed as a credit against your income tax
liability, or refunded, if the required information is provided to
the Service.

<PAGE>
CERTAIN ERISA CONSIDERATIONS

We and certain of our affiliates may each be considered a "party
in interest" within the meaning of the Employee Retirement Income
Security Act of 1974, or a "disqualified person" within the meaning of
Section 4975 of the Code with respect to many employee benefit plans
that are subject to Employee Retirement Income Security Act and
individual retirement accounts. The purchase of the trust preferred
securities by an employee benefit plan or IRA that is subject to the
fiduciary responsibility provisions of Employee Retirement Income
Security Act or the prohibited transaction provisions Section 4975(e)(1)
of the Internal Revenue Code and with respect to which we, or any
affiliate of ours is a service provider (or otherwise is a party in
interest or a disqualified person), may constitute or result in a
prohibited transaction under Employee Retirement Income Security Act or
Section 4975 of the Internal Revenue Code, unless the trust preferred
securities are acquired pursuant to and in accordance with an applicable
exemption. Any pension or other employee benefit plan, fiduciary or IRA
holder, proposing to acquire any trust preferred securities for such a
plan or IRA should consult with legal counsel.

UNDERWRITING

Subject to the terms and conditions of an underwriting
agreement, the underwriters named below, for whom EVEREN Securities,
Inc. and Wheat First Securities, a division of First Union Capital
Markets Corp., are acting as representatives, have severally agreed to
purchase from us, and we have agreed to sell to them, the respective number
of trust preferred securities set forth opposite each underwriter's
name below:

<TABLE>
<CAPTION>
NUMBER OF TRUST
UNDERWRITERS PREFERRED SECURITIES
------------ --------------------
<S> <C>
EVEREN Securities, Inc................................ 790,000

Wheat First Securities................................ 500,000

Advest, Inc........................................... 30,000

Fahnestock & Co. Inc.................................. 30,000

Howe Barnes Investments Inc........................... 30,000

Ryan, Beck & Co., Inc................................. 30,000

Sandler O'Neill & Partners, L.P....................... 30,000

Stifel, Nicolaus & Company, Incorporated.............. 30,000

Utendahl Capital Partners, L.P........................ 30,000

---------
Total............................................. 1,500,000
=========
</TABLE>

The underwriting agreement provides that the obligations of the
several underwriters thereunder are subject to approval of certain
legal matters by their counsel and to various conditions. The nature
of the underwriters' obligation is such that they are committed to
purchase and pay for all the trust preferred securities (other than
those covered by the over-allotment option discussed below) if any
are purchased.

The underwriters will initially offer the trust preferred
securities to the public at the price stated on the cover page. The
underwriters may offer trust preferred securities to selected
dealers at the public offering price less a concession of up to
$0.20 per trust preferred security. Those dealers may reallow a
discount not in excess of $0.10 per trust preferred security to
other brokers and dealers. After the initial offering of the trust
preferred securities, the underwriters may change the offering price,
concession, discount and other selling terms.

The Trust has granted the underwriters an option to purchase
up to 225,000 additional trust preferred securities. This option is
exercisable from time to time for 30 days after the date of this
prospectus, but may be exercised by the underwriters only to cover
any over-allotments.

The underwriters agreed to purchase the trust preferred
securities at the price stated on the cover page of this prospectus.
Because the Trust will use the proceeds from the sale of the trust
preferred securities to

100

<PAGE>

purchase the junior subordinated debentures from us, we have agreed
to pay the underwriters the following compensation:

<TABLE>
<CAPTION>
UNDERWRITING
COMPENSATION
------------
<S> <C>
Per trust preferred security........................ $ 0.375
Total (assuming no exercise of over-allotment
option)........................................... 562,500
Total (assuming full exercise of over-allotment
option)........................................... 646,875
</TABLE>

We estimate that we will spend approximately $350,000 for printing,
depository and trustees' fees, legal and accounting fees, and other
expenses of the offering in addition to underwriting compensation.

In connection with the offering, the underwriters and their
affiliates may engage in transactions, effected in accordance with
the SEC's Regulation M, that are intended to stabilize, maintain or
otherwise affect the market price of the trust preferred securities.
These transactions may include over-allotment or other mechanisms
through which the underwriters create a selling syndicate short position
by selling more trust preferred securities than the underwriters are
committed to purchase from the Trust. The underwriters may purchase trust
preferred securities in the open market following completion of the
initial offering. The underwriters also may bid for, and purchase,
the trust preferred securities, including at a price above that
which might otherwise prevail in the open market for the purpose of
preventing or retarding a decline in the market price of the trust
preferred securities. The underwriters may impose penalty bids under
which selling commissions allowed to syndicated members or other dealers
participating in the offering are reclaimed if trust preferred securities
previously distributed in the offering are repurchased by the underwriters.
Any of these transactions may maintain or stabilize the price for the
trust preferred securities at a level above that which might otherwise
prevail in the open market. None of the underwriters, the Trust or us
make any representation or prediction as to the direction or magnitude of
any effect that the transactions described above may have on the market
price of the trust preferred securities. The underwriters are not required
to engage in any of these transactions and may discontinue them at any
time without notice if they commence them. The underwriters may
effect these transactions on the American Stock Exchange or
elsewhere.

We and the Trust have agreed to indemnify the underwriters
against liabilities arising from the offering of the trust preferred
securities, including civil liabilities under the Securities Act of
1933, or to contribute to payments that the underwriters may be
required to make in connection with those liabilities.

The underwriters have advised us that they do not intend to
confirm any sales or trust preferred securities to any discretionary
accounts. The underwriters will comply with Rule 2810 under the NASD
Conduct Rules when they offer and sell the trust preferred
securities because the National Association of Securities Dealers,
Inc. may view the trust preferred securities as interests in a
direct participation. The underwriters and their affiliates may
provide investment banking services for us or our affiliates in the
future for which they would expect to receive customary fees and
commissions.

VALIDITY OF SECURITIES

The validity of the guarantee and the junior subordinated
debentures and certain tax matters will be passed upon for us by
Thompson Coburn LLP, St. Louis, Missouri, our counsel, and certain
legal matters will be passed upon for the underwriters by Barack
Ferrazzano Kirschbaum Perlman & Nagelberg, Chicago, Illinois.
Certain matters of Delaware law relating to the validity of the
trust preferred securities, the enforceability of the trust
agreement and the creation of the Trust will be passed upon by
Richards, Layton & Finger, P.A. as special Delaware counsel to us and the
Trust. Thompson Coburn LLP and Barack Ferrazzano Kirschbaum Perlman
& Nagelberg will rely as to certain matters of Delaware law on the
opinion of Richards, Layton & Finger, P.A.

101

<PAGE>
<PAGE>
EXPERTS

Ernst & Young, LLP, independent auditors, have audited our
consolidated financial statements included in our Annual Report on
Form 10-K for the year ended December 31, 1998 as set forth in their
report, which is included and incorporated by reference in this
prospectus and elsewhere in the registration statement. Our
financial statements are included and incorporated by reference in
reliance on Ernst & Young, LLP's report, given on their authority as
experts in accounting and auditing.

The consolidated financial statements of Allegiant as of
December 31, 1997 and for each of the two years in the period ended
December 31, 1997, included in this prospectus and in the
registration statement of which this prospectus is a part, have been
audited by BDO Seidman, LLP, independent auditors, as set forth in
their report dated March 13, 1998 appearing in the registration
statement, and are included in reliance on such report given upon the
authority of such firm as experts in accounting and auditing.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

We are subject to the informational requirements of the
Securities Exchange Act of 1934. Accordingly, we file annual,
quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. You may
read and copy any document we file with the Securities and Exchange
Commission at the public reference facilities maintained by the
Securities and Exchange Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Our filings with the Securities and Exchange
Commission also are available to the public from the Securities and
Exchange Commission's website at http://www.sec.gov. Please call the
Securities and Exchange Commission at 1-800-SEC-0330 for further
information. Our common stock is listed on the Nasdaq National
Market.

This prospectus is part of a registration statement we filed
with the Securities and Exchange Commission and does not contain all
of the information set forth in the registration statement. You
should consult the registration statement for further information
with respect to our company and these securities.

The Securities and Exchange Commission allows us to "incorporate
by reference" the information we file with them, which means that we
can disclose important information to you by referring you to those
documents. The information incorporated by reference is considered
to be part of this prospectus, and later information that we file
with the Securities and Exchange Commission will automatically
update and supersede this information and information in this
prospectus. We incorporate by reference the documents listed below
and any future filings made with the Securities and Exchange
Commission under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 until all of the securities are
sold.

* Annual Report on Form 10-K, as amended by Annual Report on
Form 10-K/A, for the year ended December 31, 1998; and

* Quarterly Report on Form 10-Q for the quarter ended March 31,
1999.

You may request a copy of these filings, at no cost, by writing
or calling us at the following address: Secretary, Allegiant
Bancorp, Inc., 2122 Kratky Road, St. Louis, Missouri 63114,
telephone (314) 692-8200.

No separate financial statements of the Trust have been included
or incorporated by reference in this document. We do not, nor does
the Trust, consider that such financial statements would be material
to holders of the trust preferred securities because the Trust is a
newly formed special purpose entity, has no operating history or
independent operations and is not engaged in and does not propose to
engage in any activity other than holding as trust assets the junior
subordinated debentures and issuing the trust preferred securities
and trust common securities. See "Allegiant Capital Trust I,"
"Description of Trust Preferred Securities," "Description of Junior
Subordinated Debentures" and "Description of Guarantee." In
addition, we do not expect that the Trust will be filing reports
under the Securities Exchange Act of 1934 with the SEC.

102

<PAGE>
<TABLE>
INDEX TO FINANCIAL STATEMENTS

<S> <C>
Report of Independent Auditors--Ernst & Young LLP........... F-1
Consolidated Balance Sheets as of March 31, 1999 (unaudited)
and December 31, 1998 and 1997............................ F-2
Consolidated Statements of Income for the three months ended
March 31, 1999 and 1998 (unaudited) and each of the years
in the three-year period ended December 31, 1998.......... F-3
Consolidated Statements of Shareholders' Equity for the
three months ended March 31, 1999 (unaudited) and for each
of the years in the three-year period ended December 31,
1998...................................................... F-4
Consolidated Statements of Cash Flows for the three months
ended March 31, 1999 and 1998 (unaudited) and for each of
the years in the three-year period ended December 31, 1998 F-5
Notes to Consolidated Financial Statements.................. F-6
</TABLE>

103

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

THIS PAGE INTENTIONALLY

LEFT BLANK

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

REPORT OF INDEPENDENT AUDITORS

Shareholders and Board of Directors
Allegiant Bancorp, Inc.

We have audited the accompanying consolidated balance sheet of Allegiant
Bancorp, Inc. as of December 31, 1998 and the related consolidated statements
of income, shareholders' equity, and cash flows for the year then ended. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits. The consolidated balance sheets as of December 31, 1997, and the
related consolidated statements of income, changes in shareholders' equity and
cash flows for the two-year period ended December 31, 1997, were audited by
other auditors whose report dated March 13, 1998 expressed an unqualified
opinion on those statements.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the 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 audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Allegiant
Bancorp, Inc. at December 31, 1998 and the consolidated results of its
operations and its cash flows for the year then ended in conformity with
generally accepted accounting principles.

Ernst & Young LLP
St. Louis, Missouri
January 21, 1999

F-1

<TABLE>
ALLEGIANT BANCORP, INC.
CONSOLIDATED BALANCE SHEETS

<CAPTION>
DECEMBER 31,
MARCH 31, -----------------------
1999 1998 1997
----------- -------- --------
(UNAUDITED)
(DOLLARS IN THOUSANDS,
EXCEPT SHARE AND PER SHARE AMOUNTS)
<S> <C> <C> <C>
ASSETS:
Cash and due from banks..................................... $ 12,855 $ 13,693 $ 14,872
Federal funds sold and other overnight investments.......... 4,475 3,430 1,600
Investment securities
Available-for-sale (at estimated market value).......... 45,075 42,740 44,918
Held-to-maturity (estimated market value of $10,927,
$12,132 and $32,146, respectively).................... 10,852 12,040 31,951
Loans, net of allowance for loan losses of $6,767, $6,442
and $5,193, respectively.................................. 513,539 489,227 479,669
Premises and equipment...................................... 10,866 11,010 10,801
Accrued interest and other assets........................... 10,747 11,438 10,837
Intangible assets........................................... 12,448 12,696 13,589
-------- -------- --------
Total assets................................................ $620,857 $596,274 $608,237
======== ======== ========

LIABILITIES AND SHAREHOLDERS' EQUITY:

DEPOSITS:
Non-interest bearing.................................... $ 51,627 $ 55,417 $ 50,060
Interest bearing........................................ 396,378 364,176 382,370
Certificates of deposit of $100,000 or more............. 33,033 31,173 52,211
-------- -------- --------
Total deposits.............................................. 481,038 450,766 484,641
-------- -------- --------
Short-term borrowings....................................... 47,039 53,542 53,579
Long-term debt.............................................. 40,275 40,275 23,275
Accrued expenses and other liabilities...................... 3,446 3,587 4,671
-------- -------- --------
Total liabilities........................................... 571,798 548,170 566,166

SHAREHOLDERS' EQUITY:

Common Stock, $.01 par value--authorized 20,000,000
shares; issued 6,558,015, 6,536,164 and 6,111,743
shares, respectively.................................. 65 65 61
Capital surplus......................................... 42,026 41,898 39,484
Retained earnings....................................... 7,057 6,058 2,441
Accumulated other comprehensive income.................. (89) 83 85
-------- -------- --------
Total shareholders' equity.................................. 49,059 48,104 42,071
-------- -------- --------
Total liabilities and shareholders' equity.................. $620,857 $596,274 $608,237
======== ======== ========

See accompanying notes to consolidated financial statements.
</TABLE>

F-2

<TABLE>
ALLEGIANT BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME

<CAPTION>
THREE MONTHS ENDED
MARCH 31, YEARS ENDED DECEMBER 31,
--------------------- -----------------------------------
1999 1998 1998 1997 1996
------- ------- ------- ------- -------
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
INTEREST INCOME:
Interest and fees on loans..................... $11,073 $11,142 $44,412 $33,473 $21,428
Investment securities.......................... 773 1,086 4,295 3,966 3,477
Federal funds sold and overnight investments... 79 42 511 326 151
------- ------- ------- ------- -------
Total interest income.............................. 11,925 12,270 49,218 37,765 25,056
------- ------- ------- ------- -------

INTEREST EXPENSE:
Interest on deposits........................... 4,856 5,618 21,948 17,253 12,060
Interest on short-term borrowings.............. 639 564 2,625 2,895 1,542
Interest on long-term debt..................... 593 659 2,694 1,318 1,397
------- ------- ------- ------- -------
Total interest expense............................. 6,088 6,841 27,267 21,466 14,999
------- ------- ------- ------- -------
Net interest income................................ 5,837 5,429 21,951 16,299 10,057
Provision for loan losses.......................... 562 400 2,420 2,397 1,448
------- ------- ------- ------- -------
Net interest income after provision for loan
losses........................................... 5,275 5,029 19,531 13,902 8,609
------- ------- ------- ------- -------
OTHER INCOME:
Service charges on deposits.................... 148 89 1,387 913 612
Net gain on sale of securities................. -- 12 68 2 49
Other income................................... 1,106 1,008 7,869 2,383 732
------- ------- ------- ------- -------
Total other income................................. 1,254 1,109 9,324 3,298 1,393
------- ------- ------- ------- -------

OTHER EXPENSES:
Salaries and employee benefits................. 2,445 2,314 9,663 6,192 3,455
Occupancy and furniture and equipment.......... 764 834 3,275 1,681 1,137
Other expense.................................. 1,649 1,970 8,357 5,196 2,427
------- ------- ------- ------- -------
Total other expenses............................... 4,858 5,118 21,295 13,069 7,019
------- ------- ------- ------- -------
Income before income taxes......................... 1,671 1,020 7,560 4,131 2,983
Provision for income taxes......................... 669 393 3,026 1,716 1,175
------- ------- ------- ------- -------
Net income......................................... $ 1,002 $ 627 $ 4,534 $ 2,415 $ 1,808
======= ======= ======= ======= =======
Basic earnings per share....................... $ 0.15 $ 0.10 $ 0.72 $ 0.54 $ 0.55
Diluted earnings per share..................... $ 0.15 $ 0.09 $ 0.68 $ 0.49 $ 0.48

See accompanying notes to consolidated financial statements.
</TABLE>

F-3

<TABLE>
ALLEGIANT BANCORP, INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<CAPTION>
ACCUMULATED
OTHER TOTAL
COMMON STOCK CAPITAL RETAINED COMPREHENSIVE SHAREHOLDERS' COMPREHENSIVE
SHARES PAR SURPLUS EARNINGS INCOME EQUITY INCOME
--------- ----- ------- -------- ------------- ------------- -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, January 1, 1996 as originally
reported.............................. 1,989,033 20 $13,542 $ 467 $ (91) $13,938
Reflect 5-for-4 stock split......... 497,259 5 (5) -- --
Reflect 6-for-5 stock split......... 497,259 5 (5) -- --
--------- --- ------- ------ ----- -------
Adjusted January 1, 1996................ 2,983,551 30 13,532 467 (91) 13,938
Net income.......................... -- -- -- 1,808 1,808 $1,808
Change in net unrealized gains
(losses) on available-for-sale
securities........................ -- -- -- -- 114 114 114
------
Comprehensive income................ $1,922
======
Cash dividends declared............. -- -- -- (187) (187)
Issuance of Common Stock for:
Stock dividend declared......... 309,518 3 1,728 (1,731) --
Conversion of subordinated
debentures.................... 86,592 1 503 -- 504
Exercise of stock
warrants/options.............. 17,771 -- 25 -- 25
Various stock issuance plans.... 8,264 -- 184 -- 184
--------- --- ------- ------ ----- -------
Balance December 31, 1996............... 3,405,696 34 15,972 357 23 16,386
Net income.......................... -- -- -- 2,415 2,415 $2,415
Change in net unrealized gains
(losses) on available-for-sale
securities........................ -- -- -- -- 62 62 62
------
Comprehensive income................ $2,477
======
Cash dividends declared............. -- -- -- (331) (331)
Issuance of Common Stock for:
Rights offerings................ 1,523,037 15 11,226 -- 11,241
Acquisition of Reliance
Financial, Inc................ 898,689 9 10,578 -- 10,587
Exercise of stock
warrants/options.............. 260,414 3 1,509 -- 1,512
Various stock issuance plans.... 23,907 -- 199 -- 199
--------- --- ------- ------ ----- -------
Balance December 31, 1997............... 6,111,743 61 39,484 2,441 85 42,071
Net income.......................... -- -- -- 4,534 4,534 $4,534
Change in net unrealized gains
(losses) on available-for-sale
securities........................ -- -- -- -- (2) (2) (2)
------
Comprehensive income................ $4,532
======
Cash dividends declared............. -- -- -- (917) (917)
Issuance of Common Stock for:
Exercise of stock
warrants/options.............. 384,785 4 2,112 -- 2,116
Various stock issuance plans.... 39,636 -- 302 -- 302
--------- --- ------- ------ ----- -------
Balance December 31, 1998............... 6,536,164 65 41,898 6,058 83 48,104

<CAPTION>
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C>
Net income -- -- -- 1,002 1,002 $1,002
Unrealized losses on available-
for-sale securities, net of
reclassification adjustment
(see below)....................... -- -- -- -- (172) (172) (172)
------
Comprehensive income................ -- -- -- -- -- $ 830
======
Issuance of Common Stock for:
Warrants exercised.............. 1,770 -- 10 -- 10
New shares issued............... 3,445 -- 52 -- 52
Options exercised............... 16,636 -- 66 -- 66
--------- --- ------- ------ ----- -------
Balance March 31, 1999.................. 6,558,015 $65 $42,026 $7,057 $ (89) $49,059
========= === ======= ====== ===== =======

<PAGE>
<CAPTION>
YEAR ENDED DECEMBER 31,
THREE MONTHS ENDED -----------------------------------
MARCH 31, 1999 1998 1997 1996
------------------ ---- ---- ----
(UNAUDITED)
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Reclassification adjustments:
Unrealized gains (losses) on
available-for-sale securities........ $(172) $39 $63 $144
Less:
Reclassification adjustment for
gains realized included in net
income........................... -- 41 1 30
----- --- --- ----
Net unrealized gains (losses) on
available-for-sale securities........ $(172) $(2) $62 $114
===== === === ====
See accompanying notes to consolidated financial statements.
</TABLE>

F-4

<PAGE>
<PAGE>
<TABLE>
ALLEGIANT BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

<CAPTION>
THREE MONTHS ENDED
MARCH 31, YEARS ENDED DECEMBER 31,
---------------------- ---------------------------------------
1999 1998 1998 1997 1996
-------- -------- --------- --------- ---------
(UNAUDITED)
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES:
Net income.................................... $ 1,002 $ 627 $ 4,534 $ 2,415 $ 1,808
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization............... 873 723 4,366 1,057 536
Provision for loan losses................... 562 400 2,420 2,397 1,448
Net realized gains on securities
available-for-sale......................... -- -- (68) (2) (49)
Deferred tax benefit........................ -- -- (496) (685) (282)
Net gain on sale of mortgage loans.......... -- -- (1,112) -- --
Net gain on disposition of branches......... -- -- (2,370) -- --
Changes in assets and liabilities:
Accrued interest receivable and other
assets................................... 577 (1,435) 811 (1,077) (938)
Accrued expenses and other liabilities.... (128) 945 (745) 623 768
-------- -------- --------- --------- ---------
Cash provided by operating activities..... 2,886 1,260 7,340 4,728 3,291
-------- -------- --------- --------- ---------

INVESTING ACTIVITIES:
Net cash received in acquisition of Reliance
Financial, Inc............................... -- -- -- 1,533 --
Net cash received in acquisition of
branches..................................... -- -- -- 83,596 --
Net cash paid in disposition of branches...... -- -- (22,662)
Proceeds from maturities of securities
held-to-maturity............................. 1,188 9,111 22,885 17,019 41,343
Purchase of investment securities
held-to-maturity............................. -- -- (2,974) (10,396) (25,279)
Proceeds from maturities of securities
available-for-sale........................... 9,659 9,888 87,840 25,020 36,797
Proceeds from sales of securities
available-for-sale........................... -- 1,230 8,989 2,949 3,882
Purchase of investments securities
available-for-sale........................... (12,281) (1,500) (94,586) (39,211) (34,457)
Loans made to customers, net of repayments.... (24,874) (22,693) (102,815) (175,387) (120,070)
Proceeds from sale of mortgage loans.......... -- -- 78,374 -- --
Purchases of assets held for operating leases,
net.......................................... -- -- (2,959) (2,992) --
Additions to premises and equipment........... (266) (676) (3,186) (4,710) (1,574)
-------- -------- --------- --------- ---------
Cash used in investing activities......... (26,574) (4,640) (31,094) (102,579) (99,358)
-------- -------- --------- --------- ---------

FINANCING ACTIVITIES:
Net increase in deposits...................... 30,273 (4,865) 5,201 57,518 77,362
Net increase in short-term borrowings......... (6,503) (2,541) 338 17,442 22,029
Proceeds from issuance of long-term debt...... -- 15,000 31,150 8,625 --
Repayment of long-term debt................... -- -- (13,650) (13) (4,552)
Proceeds from issuance of common stock........ 128 266 2,283 12,753 61
Payment of dividends.......................... (3) (122) (917) (331) (187)
-------- -------- --------- --------- ---------
Cash provided by financing activities..... 23,895 7,738 24,405 95,994 94,713
-------- -------- --------- --------- ---------
Net (decrease) increase in cash and cash
equivalents.................................. 207 4,358 651 (1,857) (1,354)
Cash and cash equivalents, beginning of
period....................................... 17,123 16,472 16,472 18,329 19,683
-------- -------- --------- --------- ---------
Cash and cash equivalents, end of period...... $ 17,330 $ 20,830 $ 17,123 $ 16,472 $ 18,329
======== ======== ========= ========= =========

See accompanying notes to consolidated financial statements.
</TABLE>

F-5

ALLEGIANT BANCORP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1. ACCOUNTING POLICIES:

Basis of Presentation. The accompanying consolidated financial statements
include the accounts of Allegiant Bancorp, Inc. (the "Company") and its
subsidiaries. The financial statements have been prepared in conformity with
generally accepted accounting principles and reporting practices applicable to
the banking industry. All significant intercompany transactions and balances
have been eliminated. The significant accounting policies are summarized below.

Business. The Company's bank subsidiary, (the "Bank") provides a full range
of banking services to individual and corporate customers in the St. Louis,
Missouri metropolitan area. The Bank is subject to intense competition from
other financial institutions. The Bank also is subject to the regulations of
certain federal and state agencies and undergoes periodic examination by those
regulatory authorities.

Accounting Estimates. The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from estimates.

Reclassifications. Certain reclassifications have been made to the 1996 and
1997 financial statements to conform to the 1998 presentation. These
reclassifications had no effect on net income.

Investment Securities. Securities are classified as held-to-maturity or
available-for-sale. Only those securities which management has the intent and
ability to hold to maturity are classified as held-to-maturity and are reported
at amortized cost. Securities that are purchased with the intent to hold for an
indefinite period of time, including securities that management intends to use
as part of its asset/liability strategy or that may be sold to meet liquidity
needs, are classified as available-for-sale securities. Available-for-sale
securities are reported at fair value with unrealized gains and losses, net of
related deferred income taxes, reported in other comprehensive income. Interest
and dividends on securities, including amortization of premium and accretion of
discounts, are reported in interest income using the interest method. Realized
securities gains or losses are reported in the Consolidated Statements of
Income. Gains and losses on securities are determined on an identified
certificate basis.

Loans Held-for-Sale. In its lending activities, the Company originates
residential mortgage loans intended for sale in the secondary market. Loans
held-for-sale are carried at the lower of cost or fair value, which is
determined on an aggregate basis. Gains or losses on the sale of loans
held-for-sale are determined on a specific identification method.

Loans. Interest income on loans is generally accrued on a simple interest
basis. Loan fees and direct costs of loan originations are deferred and
amortized over the estimated life of the loans under methods approximating the
interest method.

When, in management's opinion, the collection of interest on a loan will
not be collected in the normal course of business, or when either principal or
interest is past due over 90 days, that loan is generally placed on a
non-accrual status. When a loan is placed on non-accrual status, accrued
interest for the current year is reversed and charged against current earnings,
and accrued interest from prior years is charged against the reserve for
possible loan losses. Interest payments received on non-accrual loans are
applied to principal if there is doubt as to the collectibility of such
principal; otherwise, these receipts are recorded as interest income. A loan
remains on non-accrual status until the loan is current as to payment of both
principal and interest, and/or the borrower demonstrates the ability to pay and
remain current.

All non-accrual and renegotiated commercial-related loans are considered
impaired. Impaired loans are measured based on the present value of expected
future cash flows discounted at the loan's effective interest

F-6

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

rate, or at the loan's observable market price, or the fair value of the
collateral, if the loan is collateral dependent.

Allowance for loan losses. The allowance for loan losses is increased by
the provision charged to expense and decreased by charge-offs, net of
recoveries. Management's periodic evaluation of the adequacy of the allowance
is based on the Bank's past loan loss experience, known and inherent risks in
the portfolio, adverse situations that may affect the borrowers' ability to
repay, the estimated value of any underlying collateral and current economic
conditions.

Premises and Equipment. Premises and equipment are stated at cost less
accumulated depreciation. The provision for depreciation is computed using the
straight-line method over the estimated useful lives of the individual assets
for book purposes and accelerated methods for tax purposes. Ordinary
maintenance and repairs are charged to expense as incurred.

Real Estate Owned. Real estate acquired in foreclosure or other settlement
of loans is initially recorded at the lower of fair market value of the assets
received (less estimated selling costs) or the recorded investment in the loan
at the date of transfer. Any adjustment to fair market value at the date of
transfer is charged against the allowance for loan losses. Subsequent
write-downs are charged to operating expense including charges relating to
operating, holding or disposing of the property. Real estate owned was
approximately $0 and $330,000 at December 31, 1998 and 1997, respectively.

Intangible Assets. Intangible assets consist primarily of goodwill and
mortgage servicing assets. Goodwill, the excess of cost over the net assets
acquired in business combinations accounted for as purchases, is amortized
using the straight-line method over the estimated period to be benefited,
but not exceeding 15 years. Management reviews goodwill for possible impairment
if there is a significant event that detrimentally affects operations.
Impairment is measured using estimates of the discounted future earnings
potential of the entity or assets acquired.

Mortgage servicing assets represent recorded value associated with the
contractual right to service loans in return for a fee. These assets may be
purchased and recorded at fair value or result from the sale of loans, where
servicing is retained and recorded at an allocated carrying amount based on the
relative fair value of the assets sold. This intangible is amortized using the
level-yield method over the estimated lives of the related loans. The carrying
value of mortgage servicing assets is subject to periodic adjustment based upon
changing market conditions. At December 31, 1998 the Company had no capitalized
mortgage servicing assets compared to $182,000 at December 31, 1997.

Income Taxes. Income taxes are accounted for under the liability method in
which deferred income taxes are recognized as a result of temporary differences
between the financial reporting basis and the tax basis of the assets and
liabilities of the Company.

Cash Equivalents. For purposes of the Consolidated Statements of Cash
Flows, the Company considers cash and due from banks, federal funds sold and
other overnight investments to be cash equivalents.

New Accounting Pronouncements. Effective January 1, 1998, the Company
adopted the Financial Accounting Standards Board ("FASB") Statement of
Financial Accounting Standards No. 130, Reporting Comprehensive Income
(Statement 130). Statement 130 requires the reporting of comprehensive income
and its components in the 1998 financial statements. Comprehensive income is
defined as the change in equity from transactions and other events and
circumstances from non-owner sources, and excludes investments by and
distributions to owners. Comprehensive income also includes net income and
other items of comprehensive income meeting the above criteria. The Company's
most significant component of other comprehensive income is the unrealized
holding gains and losses on available-for-sale securities.

Effective January 1, 1998, the Company adopted the Financial Accounting
Standards Board's Statement of Financial Accounting Standards No. 131,
Disclosures about Segments of an Enterprise and Related

F-7

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Information (Statement 131). Statement 131 superseded FASB Statement No. 14,
Financial Reporting for Segments of a Business Enterprise. Statement 131
establishes standards for the way that public business enterprises report
information about operating segments in annual financial statements and
requires that those enterprises report selected information about operating
segments in interim financial reports. Statement 131 also establishes standards
for related disclosures about products and services, geographic areas and major
customers. Based on an analysis of Statement 131, the Company has one operating
segment; therefore, no additional disclosures of segment information are
presented. The adoption of Statement 131 did not affect results of operations
or financial position.

In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Standards No. 133, Accounting for Derivative Instruments and Hedging
Activities (Statement 133). The Company expects to adopt the new statement
effective January 1, 2000. Statement 133 will require the Company to recognize
all derivatives on the balance sheet at fair value. The Company does not
anticipate that the adoption of Statement 133 will have a significant effect
on its results of operations or financial position.

Unaudited Interim Financial Information. The interim financial information
as of March 31, 1999 and for the three-month periods ended March 31, 1999 and
1998 is unaudited. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. The interim results are not necessarily indicative of results
for any future period.

NOTE 2. ACQUISITIONS AND DIVESTITURES:

In August 1997, the Company acquired all the outstanding capital stock of
Reliance Financial, Inc. in exchange for 599,126 shares of the Company's Common
Stock. In September 1997, the Company purchased two bank branch offices from
Roosevelt Bank. As part of the agreement, the Company assumed deposits of
$96.076 million in exchange for loans of $3.017 million, premises and equipment
of $537 thousand and cash of $84.035 million. Total goodwill and core deposit
intangible assets recorded by the Company in connection with this acquisition
was $8.833 million. Both acquisitions were recorded using the purchase method
of accounting. Results of operations of companies and branches acquired in
purchase business combinations are included from the date of acquisition.

In December 1998, the Company sold three out-of-market branches to another
financial institution. The book value of assets disposed of totaled $17.492
million, the book value of liabilities transferred totaled $39.992 million
and the net cash paid for the divestiture was $22.662 million. A $2.370
million gain was recognized from the sale.

F-8

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 3. INVESTMENT SECURITIES:

Debt and equity securities have been classified in the Consolidated Balance
Sheets according to management's intent. The carrying amount of securities and
their approximate fair values at December 31 were as follows:

<TABLE>
<CAPTION>
SECURITIES AVAILABLE-FOR-SALE SECURITIES HELD-TO-MATURITY
DECEMBER 31, 1998 DECEMBER 31, 1998
------------------------------------------------ ------------------------------------------------
GROSS GROSS GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR AMORTIZED UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE COST GAINS LOSSES VALUE
--------- ---------- ---------- ------- --------- ---------- ---------- -------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. government and agency
securities.............. $29,269 $217 $ (51) $29,436 $ 7,585 $ 30 $(21) $ 7,595
State and municipal
securities.............. 598 9 -- 606 858 28 -- 886
Mortgage-backed
securities.............. 8,360 38 (65) 8,333 3,597 55 -- 3,651
Federal Home Loan Bank
stock................... 3,574 -- -- 3,574 -- -- -- --
Other securities.......... 791 -- -- 791 -- -- -- --
------- ---- ----- ------- ------- ---- ---- -------
Total..................... $42,592 $264 $(116) $42,740 $12,040 $113 $(21) $12,132
======= ==== ===== ======= ======= ==== ==== =======

<CAPTION>
SECURITIES AVAILABLE-FOR-SALE SECURITIES HELD-TO-MATURITY
DECEMBER 31, 1997 DECEMBER 31, 1997
------------------------------------------------ ------------------------------------------------
GROSS GROSS GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR AMORTIZED UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE COST GAINS LOSSES VALUE
--------- ---------- ---------- ------- --------- ---------- ---------- -------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. government and agency
securities.............. $26,545 $106 $ (9) $26,642 $21,712 $ 50 $(131) $21,631
State and municipal
securities.............. 597 -- -- 597 966 24 -- 990
Mortgage-backed
securities.............. 9,243 33 (1) 9,275 9,273 253 (1) 9,525
Federal Home Loan Bank
stock................... 7,033 -- -- 7,033 -- -- -- --
Other securities.......... 1,371 -- -- 1,371 -- -- -- --
------- ---- ---- ------- ------- ---- ----- -------
Total..................... $44,789 $139 $(10) $41,918 $31,951 $327 $(132) $32,146
======= ==== ==== ======= ======= ==== ===== =======
</TABLE>

Gross realized gains and losses on the sale of securities available-for-sale
were $71 thousand and $3 thousand, respectively, in 1998 and $15 thousand and
$13 thousand, respectively, in 1997.

Held-to-maturity and available-for-sale securities with a carrying value of
$33.579 million and $47.373 million at December 31, 1998 and 1997, respectively,
were pledged to secure public deposits and short-term borrowings.

F-9

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The contractual maturities of securities held-to-maturity and securities
(other than Federal Home Loan Bank stock and other securities)
available-for-sale at December 31, 1998 were as follows:

<TABLE>
<CAPTION>
DECEMBER 31, 1998
-----------------------------------------------------
SECURITIES SECURITIES
AVAILABLE-FOR-SALE HELD-TO-MATURITY
----------------------- -----------------------
AMORTIZED FAIR AMORTIZED FAIR
COST VALUE COST VALUE
--------- ------- --------- -------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Due in one year or less.......................... $ 5,503 $ 5,538 $ 1,818 $ 1,829
Due from one year to five years.................. 21,561 21,646 6,294 6,302
Due from five years to ten years................. 3,396 3,446 305 323
Due after ten years.............................. 198 203 26 27
------- ------- ------- -------
Subtotal..................................... 30,658 30,883 8,443 8,481
Mortgage-backed securities....................... 8,360 8,333 3,597 3,651
------- ------- ------- -------
Total........................................ $39,018 $39,166 $12,040 $12,132
======= ======= ======= =======
</TABLE>

NOTE 4. LOANS:

The components of loans in the Consolidated Balance Sheets were as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------
1998 1997
-------- --------
(IN THOUSANDS)
<S> <C> <C>
Commercial........................................ $126,239 $109,937
Real estate mortgage.............................. 312,836 331,416
Real estate construction.......................... 36,590 27,181
Consumer and other................................ 20,908 16,821
Net deferred loan fees, premiums and discounts.... (904) (493)
-------- --------
Total loans....................................... 495,669 484,862
Allowance for loan losses......................... (6,442) (5,193)
-------- --------
Net loans......................................... $489,227 $479,669
======== ========
</TABLE>

An analysis of the change in the allowance for loan losses follows:

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------
1998 1997
------ ------
(IN THOUSANDS)
<S> <C> <C>
Balance, beginning of year........................ $5,193 $3,100
Acquired subsidiary balance....................... -- 403
Loans charged off................................. (1,226) (759)
Recoveries........................................ 55 52
------ ------
Net loans charged off............................. (1,171) (707)
Provision for loan losses......................... 2,420 2,397
------ ------
Balance, end of year.............................. $6,442 $5,193
====== ======
</TABLE>

F-10

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The recorded investment in loans that were considered to be impaired under
Statement of Financial Accounting Standards No. 114, as amended by Statement of
Financial Accounting Standards No. 118, was $1.495 million in 1998 and $559
thousand in 1997 (these impaired loans were all classified as non-accrual
loans). The related allowance for these impaired loans was $269 thousand in 1998
and $86 thousand in 1997. Interest income that would have been recognized for
non-accrual loans was $72 thousand in 1998 and $57 thousand in 1997. Cash basis
income on non-accrual loans was not significant for 1998 or 1997.

The Company and the Bank have entered into transactions with their
directors, significant shareholders and affiliates (related parties). Such
transactions were made in the ordinary course of business on substantially the
same terms and conditions, including interest rates and collateral, as those
prevailing at the same time for comparable transactions with other customers,
and did not, in the opinion of management, involve more than normal credit risk
or present other unfavorable features. The aggregate amount of loans to such
related parties at December 31, 1998 and 1997 was $35.930 million and $16.432
million, respectively. During 1998, $26.049 million of new loans and $6.551
million of repayments were made on related party loans. Prior year numbers have
been reclassified for those directors and executive officers that no longer
hold such positions. As of December 31, 1998 $166 thousand of a related party
loan was past due 90 days or more. This loan has subsequently been brought
current. No related party loans were past due more than 90 days as of
December 31, 1997.

NOTE 5. PREMISES AND EQUIPMENT:

Components of premises and equipment as of December 31, 1998 and 1997 were
as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------
1998 1997
------- -------
(IN THOUSANDS)
<S> <C> <C>
Land.............................................. $ 2,546 $ 2,618
Bank premises..................................... 5,657 5,019
Furniture, equipment and automobiles.............. 6,537 5,630
------- -------
Total cost........................................ 14,740 13,267
Less accumulated depreciation..................... (3,730) (2,466)
------- -------
Net book value.................................... $11,010 $10,801
======= =======
</TABLE>

The bank leases various banking facilities and one piece of equipment under
agreements, which expire at various dates through September 2012. These
agreements have options to renew. Future minimum lease payments required under
operating leases which have initial or remaining non-cancelable terms in excess
of one year as of December 31, 1998 were approximately as follows:

<TABLE>
<CAPTION>
YEARS ENDED MINIMUM
DECEMBER 31, RENTAL
------------ -------
(IN THOUSANDS)
<S> <C>
1999................................ $ 201
2000................................ 217
2001................................ 234
2002................................ 224
2003................................ 192
2004 and later...................... 1,399
------
Total........................... $2,467
======
</TABLE>

F-11

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Rental expense for all operating leases was $327 thousand in 1998 and $210
thousand in 1997.

NOTE 6. DEPOSITS:

Deposits consisted of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------
1998 1997
-------- --------
(IN THOUSANDS)
<S> <C> <C>
Non-interest bearing.............................. $ 55,417 $ 50,060
Interest bearing demand........................... 19,075 18,448
Money market accounts............................. 123,827 97,408
Savings........................................... 14,917 16,157
Time and IRA certificates under $100,000.......... 206,357 250,357
-------- --------
Total core deposits............................. 419,593 432,430
Time certificates $100,000 and over............... 31,173 52,211
-------- --------
Total deposits.................................. $450,766 $484,641
======== ========
</TABLE>

The scheduled maturities of the Company's consumer time certificates under
$100,000 and time certificates $100,000 and over as of December 31, 1998 are as
follows:

<TABLE>
<CAPTION>
SCHEDULED
MATURITY
PERIOD AMOUNT
------ ---------
(IN THOUSANDS)
<S> <C>
1999............................... $165,023
2000............................... 41,452
2001............................... 18,513
2002............................... 6,126
2003............................... 5,402
2004 and later..................... 1,014
--------
Total.......................... $237,530
========
</TABLE>

NOTE 7. INCOME TAXES:

The Company's results include income tax expense (benefit) as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------
1998 1997 1996
------ ------ ------
(IN THOUSANDS)
<S> <C> <C> <C>
Current........................................... $3,522 $2,401 $1,457
Deferred.......................................... (496) (685) (282)
------ ------ ------
Total............................................. $3,026 $1,716 $1,175
====== ====== ======
</TABLE>

F-12

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The tax effects of temporary differences that gave rise to the deferred tax
assets and liabilities are presented below:

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------
1998 1997
------ ------
(IN THOUSANDS)
<S> <C> <C>
DEFERRED TAX ASSETS:
Reserve for possible loan losses................ $2,217 $1,536
Deferred loan fees.............................. -- 194
Deferred compensation........................... -- 74
Accrued expenses................................ -- 63
Mark-to-market securities adjustments........... -- 44
Other........................................... 116 72
------ ------
Total deferred tax assets........................... 2,333 1,983
------ ------

DEFERRED TAX LIABILITIES:
Depreciation.................................... (119) (461)
Investments in debt and equity securities--SFAS
No. 115....................................... (50) --
Discount accretion.............................. (83) --
Other........................................... (10) (29)
------ ------
Total deferred tax liabilities...................... (262) (490)
------ ------
Net deferred tax assets............................. $2,071 $1,493
====== ======
</TABLE>

A valuation allowance would be provided on deferred tax assets when it is
more likely than not that some portion of the assets will not be realized. The
Company has not established a valuation allowance as of December 31, 1998 or
1997, due to management's belief that all criteria for recognition have been
met, including the existence of a history of taxes paid sufficient to support
the realization of the deferred tax assets.

Income tax expense as reported differs from the amounts computed by applying
the statutory federal income tax rate to pre-tax income as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------
1998 1997 1996
------ ------ ------
(IN THOUSANDS)
<S> <C> <C> <C>
Computed expected tax expense..................... $2,646 $1,405 $1,014
Tax-exempt income................................. (157) (38) (19)
State and local income taxes, net of federal tax
benefits........................................ 314 258 143
Goodwill amortization............................. 318 24 23
Other, net........................................ (95) 67 14
------ ------ ------
Total tax expense................................. $3,026 $1,716 $1,175
====== ====== ======
</TABLE>

F-13

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 8. SHORT-TERM BORROWINGS:

Short-term borrowings were as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------
1998 1997
------- -------
(IN THOUSANDS)
<S> <C> <C>
Securities sold under agreements to repurchase.... $14,042 $ 8,252
Federal funds purchased........................... -- 6,500
Federal Home Loan Bank advances................... 39,500 37,850
Other short-term borrowings....................... -- 977
------- -------
Total short-term borrowings....................... $53,542 $53,579
======= =======
</TABLE>

As collateral for the Federal Home Loan Bank advances, the Bank has entered
into a blanket agreement that pledges first mortgage loans with principal
balances aggregating 130% of the outstanding advances.

NOTE 9. LONG-TERM DEBT:

Long-term debt consisted of the following at year-end:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------
1998 1997
------- -------
(IN THOUSANDS)
<S> <C> <C>
Notes payable to a financial institution, interest payable
quarterly (7% on December 31, 1998), balance outstanding
payable on November 12, 2001, secured by Bank stock....... $13,650 $ --
Note payable to a financial institution, interest payable
quarterly at prime less one half of one percent (7.25% on
December 31, 1998), balance outstanding payable on
December 31, 1999, secured by Bank stock.................. -- 10,400
Notes payable to FHLB, interest payable monthly at rates
varying from 5.05% to 6.27%, principal balance due at
maturity ranging from April 3, 2000 to January 16, 2008
secured by stock in FHLB and certain loans................ 26,625 9,625
Subordinated debentures with certain shareholders, interest
payable quarterly at prime plus 3% (with a minimum floor
of 10%), called in 1998................................... -- 3,250
------- -------
Total long-term debt........................................ $40,275 $23,275
======= =======
</TABLE>

Under the terms of the current notes payable to a financial institution,
the Company and/or its subsidiaries are required to maintain certain financial
ratios and are limited with respect to cash dividends, capital expenditures
and the incurrence of additional indebtedness without prior approval. Principal
payments are required as follows: $500 thousand payable on October 1, 1999;
$500 thousand payable on October 1, 2000; $1.000 million payable on October
1, 2001; and the balance outstanding payable on November 12, 2001.

Common stock warrants of 121,049 exercisable at $6.61 per share, which were
issued in connection with the subordinated debentures, remained outstanding at
December 31, 1998. These warrants expire on May 31, 1999.

F-14

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

A summary of annual principal reductions of long-term debt as of December
31, 1998 is as follows:

<TABLE>
<CAPTION>
ANNUAL
PRINCIPAL
YEAR REDUCTIONS
---- ----------
(IN THOUSANDS)
<S> <C>
1999................................ $ 500
2000................................ 5,000
2001................................ 12,650
2002................................ 625
2003................................ 1,500
2004 and later...................... 20,000
-------
Total........................... $40,275
=======
</TABLE>

NOTE 10. COMMON STOCK AND EARNINGS PER SHARE:

On July 1, 1998, the Company's Board of Directors declared a six-for-five
stock split (in the form of a stock dividend) of the Company's Common Stock to
shareholders of record on January 8, 1999, payable January 29, 1999. Common
stock was credited and capital surplus was charged for the aggregate par value
of shares that were issued. The stated par value of each share was not changed
from $.01.

On September 19, 1997, the Company's Board of Directors declared a
five-for-four stock split (in the form of a stock dividend) of the Company's
Common Stock to shareholders of record on January 7, 1998, payable on January
21, 1998. Common Stock was credited and capital surplus was charged for the
aggregate par value of the shares that were issued. The stated par value of
each share was not changed from $.01.

On September 19, 1996, the Company's Board of Directors declared a 10%
stock dividend to shareholders of record on January 2, 1997, payable on
January 15, 1997. The transaction was valued based on the closing market price
of the Company's Common Stock at the date of declaration.

All per share data in this report have been restated to reflect the
aforementioned stock splits and stock dividend.

Basic earnings per share is computed by dividing income available to common
shareholders by the weighted average number of common shares outstanding during
the year. Diluted earnings per share gives effect to all dilutive potential
common shares that were outstanding during the year. The components of basic
and diluted earnings per share as prescribed by SFAS No. 128 are as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------------------
1998 1997 1996
---------- ---------- ----------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
Net income............................................. $ 4,534 $ 2,415 $ 1,808
========== ========== ==========
Denominator:
Weighted average shares outstanding................ 6,250,910 4,481,724 3,298,013
Effect of dilutive securities:
Stock options and warrants..................... 383,946 403,579 410,808
---------- ---------- ----------
Dilutive potential common shares....................... 383,946 403,579 410,808
---------- ---------- ----------
Denominator for diluted earnings per share-adjusted
weighted average shares.............................. 6,634,856 4,885,303 3,708,821
========== ========== ==========
Basic earnings per share............................... $ 0.72 $ 0.54 $ 0.55
Diluted earnings per share............................. 0.68 0.49 0.48
</TABLE>

F-15

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 11. EMPLOYEE BENEFITS:

Pension Plan. The Company has a defined contribution pension plan in effect
for substantially all full-time employees. Salaries and employee benefits
expense includes $39 thousand in 1997 and $30 thousand in 1996 for such plans.
Contributions under the defined contribution plan are made at the discretion of
Company management.

Phantom Stock Plan. In December 1994, the Company's Board of Directors
approved a Phantom Stock Plan for the President, under which the Company agreed
to pay a cash award to the President of the Company based on the increase in
book value on shares of the Company's Common Stock, from December 31, 1994 until
the earlier of December 31, 1998 or the year immediately preceding the year the
President's employment terminates. The annual provision under this plan for the
years ended December 31, 1998, 1997, and 1996 was approximately $47 thousand,
$225 thousand and $55 thousand, respectively. Deferred compensation included in
accrued expenses and other liabilities totaled $365 thousand, $318 thousand and
$93 thousand at December 31, 1998, 1997 and 1996, respectively.

NOTE 12. STOCK OPTION PLANS AND DIRECTORS STOCK PURCHASE PLAN:

The Company has reserved 1,454,000 shares of its Common Stock for issuance
under various stock option plans offered to directors and certain key employees
of the Company and its subsidiaries. Options are granted, by action of the
Board of Directors, to acquire stock at 110% of fair market value at the date
of the grant, for a term of up to ten years.

At December 31, 1998, 525 thousand shares remained available for option
grants under these programs. The following tables summarize option activity
over the last three years and current options outstanding:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-----------------------------------------------------------------------------------------
1998 1997 1996
-------------------------- -------------------------- -------------------------
WEIGHTED- WEIGHTED- WEIGHTED-
AVERAGE AVERAGE AVERAGE
SHARES OPTION PRICE SHARES OPTION PRICE SHARES OPTION PRICE
-------- ------------ -------- ------------ ------- ------------
<S> <C> <C> <C> <C> <C> <C>
Outstanding, beginning of
year...................... 768,230 $ 6.42 691,987 $ 5.11 509,938 $3.82
Granted..................... 146,386 14.84 284,273 9.20 190,245 8.54
Exercised................... (378,767) 4.51 (204,580) 5.79 (7,865) 3.82
Canceled.................... (18,009) 11.28 (3,450) 10.00 (331) 8.00
-------- ------ -------- ------ ------- -----
Outstanding, end of year.... 517,840 10.02 768,230 6.42 691,987 5.11
======== ======== =======
Weighted-average fair value
of options granted during
the year.................. $ 3.59 $ 2.74 $ 2.28
======== ======== =======

<CAPTION>
OPTIONS OUTSTANDING OPTIONS EXERCISABLE
- --------------------------------------------------------------------------- -------------------------------
WEIGHTED
NUMBER AVERAGE WEIGHTED NUMBER WEIGHTED
OUTSTANDING AT REMAINING AVERAGE EXERCISABLE AT AVERAGE
RANGE OF DECEMBER 31, CONTRACTUAL EXERCISE DECEMBER 31, EXERCISE
EXERCISE PRICE 1998 LIFE PRICE 1998 PRICE
- --------------------------------------------------------------------------- -------------------------------
<S> <C> <C> <C> <C> <C>
$ 2.76 - $ 3.97 46,790 0.7 years $ 3.68 43,462 $ 3.65
4.13 - 7.92 101,488 2.0 years 6.78 97,858 6.88
8.78 - 10.45 213,174 3.0 years 9.68 141,684 9.43
11.58 - 18.57 156,388 4.2 years 14.49 64,432 15.33
------- -------
2.76 - 18.57 517,840 2.9 years 10.02 347,436 9.08
======= =======
</TABLE>

F-16

<PAGE>
<PAGE>
ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The Company has a directors stock purchase plan whereby outside directors
of the Company and its subsidiaries may elect to use their directors' fees to
purchase Common Stock at market value. Twelve thousand shares were purchased at
an average price of $11.50 in 1998, thirteen thousand shares were purchased at
an average price of $10.74 in 1997 and 25 thousand shares were purchased at an
average price of $7.27 in 1996.

The Company applies Accounting Principles Board Opinion No. 25, Accounting
for Stock Issued to Employees, and related interpretations in accounting for
its plans. Accordingly, no compensation expense has been recognized for its
stock-based compensation plans. Had compensation cost for the Company's
stock-based compensation plans been determined based upon the fair value of the
grant date for the awards under these plans consistent with the methodology
prescribed under Statement of Financial Accounting Standards No. 123,
Accounting for Stock-Based Compensation, the Company's net income and earnings
per share would have been reduced to the pro forma amounts indicated below:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
---------------------------------------
1998 1997 1996
------- ------- -------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
Net income As reported............................ $4,534 $2,415 $1,808
Pro forma.............................. 4,208 1,988 1,534
Basic earnings per share As reported............................ 0.72 0.54 0.55
Pro forma.............................. 0.67 0.44 0.47
Diluted earnings per share As reported............................ 0.68 0.49 0.48
Pro forma.............................. 0.63 0.41 0.42
</TABLE>

The fair value of each option granted is estimated on the date of the grant
using the Black-Scholes option-pricing model using the following
weighted-average assumptions:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------------
1998 1997 1996
-------- -------- --------
<S> <C> <C> <C>
Dividend yield.................................. 1.80% 0.90% 0.93%
Volatility...................................... 30.80 16.38 34.23
Risk-free interest rate......................... 5.02 6.44 6.41
Expected life................................... 5 years 5 years 5 years
</TABLE>

NOTE 13. CONCENTRATIONS OF CREDIT:

Substantially all of the Bank's loans, commitments and commercial and
standby letters of credit have been granted to customers that are depositors
of the Bank and in the Bank's market area. Investments in state and municipal
securities also involve governmental entities within the Bank's market area.
The concentrations of credit by type of loan are set forth in Note 4. The
distribution of commitments to extend credit approximates the distribution
of loans outstanding. Commercial and standby letters of credit were granted
primarily to commercial borrowers.

NOTE 14. FINANCIAL INSTRUMENTS:

The Bank is a party to financial instruments with off-balance sheet risk
in the normal course of business to meet the financing needs of its customers.
These financial instruments include commitments to extend credit, standby
letters of credit and financial guarantees. These instruments involve, to
varying degrees, elements of credit and interest-rate risk in excess of the
amount recognized in the Consolidated Balance

F-17

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Sheets. The contract or notional amounts of these instruments reflect the extent
of the Bank's involvement in particular classes of financial instruments.

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

A summary of the notional amounts of the Bank's financial instruments with
off-balance sheet risk at December 31, 1998, 1997 and 1996 follows:

<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------------------
1998 1997 1996
------- ------- -------
(IN THOUSANDS)
<S> <C> <C> <C>
Commitments to extend credit...................... $82,530 $84,604 $73,522
Standby letters of credit......................... 6,496 3,868 1,310
</TABLE>

Commitments to extend credit are agreements to lend to a customer as long
as there is no 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. The Bank evaluates each
customer's creditworthiness on a case-by-case basis. The amount of collateral
obtained, if it is deemed necessary by the Bank upon extension of credit, is
based on management's credit evaluation of the counterparts. Collateral held
varies but may include accounts receivable, inventory, property, plant,
equipment and real estate.

Standby letters of credit and financial guarantees written are conditional
commitments issued by the Bank to guarantee the performance of a customer to a
third party. Those guarantees are primarily issued to support contractual
obligations of Bank customers. The credit risk involved in issuing letters of
credit is essentially the same as that involved in extending loan facilities
to customers.

The carrying amount and estimated fair values of the Company's financial
instruments were as follows:

<TABLE>
<CAPTION>
DECEMBER 31, 1998 DECEMBER 31, 1997
----------------------- -----------------------
CARRYING FAIR CARRYING FAIR
AMOUNT VALUE AMOUNT VALUE
-------- -------- -------- --------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
FINANCIAL ASSETS:
Cash and due from banks, federal funds sold
and other overnight investments.......... $ 17,123 $ 17,123 $ 16,472 $ 16,472
Securities available-for-sale.............. 42,740 42,740 44,918 44,918
Securities held-to-maturity................ 12,040 12,132 31,951 32,146
Loans, net of allowance.................... 492,787 490,596 479,669 479,502

FINANCIAL LIABILITIES:
Deposits................................... $450,766 $452,788 $484,641 $484,728
Short-term borrowings...................... 53,542 53,566 53,579 53,663
Long-term debt............................. 40,275 40,219 23,275 23,817
</TABLE>

F-18

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following methods and assumptions were used by the Company in
estimating fair values of financial instruments as disclosed herein:

Cash and Short-Term Instruments: The carrying amounts of cash and due from
banks and federal funds sold approximate their fair value.

Securities: Fair values for held-to-maturity and available-for-sale
securities are based on quoted market prices or dealer quotes, where available.
If quoted market prices are not available for a specific security, fair values
are based on quoted market prices of comparable instruments.

Loans: For variable-rate loans that reprice frequently and with no
significant change in credit risk, fair values are based on carrying values.
The fair values for fixed-rate loans are estimated using discounted cash flow
analyses and applying interest rates currently being offered for loans with
similar terms to borrowers of similar credit quality. The fair values for
non-performing loans are estimated using assumptions regarding current
assessments of collectibility and historical loss experience.

Deposits: The fair values disclosed for deposits generally payable on
demand, such as non-interest bearing checking accounts, savings accounts, NOW
accounts and market rate deposit accounts, are by definition, equal to the
amount payable on demand at the reporting date. The carrying amounts for
variable-rate, fixed-term market rate deposit accounts and certificates of
deposit approximate their fair values at the reporting date. Fair values for
fixed-rate certificates of deposit are estimated using a discounted cash flow
calculation that applies interest rates currently being offered on certificates
of similar remaining maturities to a schedule of aggregated monthly maturities
on time deposits.

Short-Term Borrowings: The carrying amounts of federal funds purchased,
borrowings under repurchase agreements and other short-term borrowings
approximate their fair values at the reporting date.

Long-Term Debt: The fair value of the Company's long-term debt is based on
quoted market prices for similar issues or estimates using discounted cash flow
analyses, based on the Company's current incremental borrowing rates for
similar types of debt instruments.

Off-Balance Sheet Financial Instruments: The fair value of commitments to
extend credit and standby letters of credit are estimated using the fees
currently charged to enter into similar agreements, taking into account the
remaining terms of the agreements, the likelihood of the counterparties drawing
on such financial instruments and the present creditworthiness of such
counterparties. The Company believes such commitments have been made on terms
which are competitive in the markets in which it operates; however, no premium
or discount is offered thereon and accordingly, the Company has not assigned a
value to such instruments for the purposes of this disclosure.

Fair value estimates are made at a specific point in time, based on
relevant market information and information about the financial instrument.
These estimates do not reflect any premium or discount that could result from
offering for sale at one time the Company's entire holdings of a particular
financial instrument. Because no market exists for a significant portion of the
Company's financial instruments, fair value estimates are based on judgments
regarding future expected loss experience, current economic conditions, risk
characteristics of various financial instruments and other factors. These
estimates are subjective in nature and involve uncertainties and matters of
significant judgment 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 that are not considered
financial instruments. 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 in many of the estimates.

F-19

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 15. REGULATORY MATTERS:

The Company and the Bank are subject to various regulatory capital
requirements administered by federal and state banking agencies. Failure to
meet minimum capital requirements can initiate certain mandatory, and possibly
additional discretionary, actions by regulators that, if undertaken, could have
a direct material effect on the Company's financial statements. Under capital
adequacy guidelines and the regulatory framework for prompt corrective action,
the Company and the Bank must meet specific capital guidelines that involve
quantitative measures of the Company's and the Bank's assets, liabilities and
certain off-balance sheet items as calculated under regulatory accounting
practices. The Company's and the Bank's capital amounts and classifications
also are subject to qualitative judgments by the regulators about components,
risk weightings and other factors.

Quantitative measures established by regulators to ensure capital adequacy
require the Company and the Bank to maintain minimum amounts and ratios (set
forth in the table below) of total and Tier 1 capital (as defined in the
regulations) to risk-weighted assets (as defined), and of Tier 1 capital (as
defined) to average assets (as defined). Management believes that, as of
December 31, 1998 the Company and the Bank met all capital adequacy
requirements to which they are subject.

As of June 30, 1998 the date of the most recent notification from the
regulatory agencies, the Bank was categorized as well capitalized under the
regulatory framework.

The actual and required capital amounts and ratios as of December 31, 1998
and 1997 for the Company and the Bank are listed in the following table:

<TABLE>
<CAPTION>
TO BE WELL
CAPITALIZED UNDER
FOR CAPITAL PROMPT CORRECTIVE
ACTUAL ADEQUACY PURPOSES ACTION PROVISIONS
------------------- ------------------- -------------------
AMOUNT RATIO AMOUNT RATIO AMOUNT RATIO
------- ----- ------- ----- ------- -----
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
AS OF DECEMBER 31, 1998:
Total Capital (to Risk-Weighted Assets)
Allegiant Bancorp, Inc.............. $41,272 8.68% $38,059 8.00% $ N/A N/A%
Allegiant Bank...................... 51,931 10.93 37,999 8.00 47,499 10.00
Tier 1 Capital (to Risk-Weighted Assets)
Allegiant Bancorp, Inc.............. 35,319 7.42 19,030 4.00 N/A N/A
Allegiant Bank...................... 45,991 9.68 18,999 4.00 28,499 6.00
Tier 1 Capital (to Average Assets)
Allegiant Bancorp, Inc.............. 35,319 5.83 24,221 4.00 N/A N/A
Allegiant Bank...................... 45,991 7.61 24,185 4.00 30,232 5.00

AS OF DECEMBER 31, 1997:
Total Capital (to Risk-Weighted Assets)
Allegiant Bancorp, Inc.............. 36,250 8.14 35,646 8.00 N/A N/A
Allegiant Bank...................... 39,820 9.35 34,081 8.00 42,601 10.00
Tier 1 Capital (to Risk-Weighted Assets)
Allegiant Bancorp, Inc.............. 28,457 6.39 17,823 4.00 N/A N/A
Allegiant Bank...................... 35,237 8.27 17,040 4.00 25,560 6.00
Tier 1 Capital (to Average Assets)
Allegiant Bancorp, Inc.............. 28,457 6.15 18,521 4.00 N/A N/A
Allegiant Bank...................... 35,237 7.76 18,156 4.00 22,695 5.00
</TABLE>

F-20

<PAGE>
<PAGE>
ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 16. RESTRICTIONS ON CASH AND DUE FROM BANKS:

At December 31, 1998, $1.926 million in cash and due from bank balances were
maintained in accordance with the guidelines set forth by the Federal Reserve
Board to maintain certain average reserve balances.

NOTE 17. OTHER INCOME AND EXPENSES:

A summary of the components of other income and other expenses exceeding one
percent of revenues in each of the years presented is as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
------------------------------
1998 1997 1996
------ ------ ----
(IN THOUSANDS)
<S> <C> <C> <C>
Gain on sale of branches.......................... $2,370 $ -- $ --
Mortgage banking revenue.......................... 2,299 1,300 312
Leasing revenue................................... 1,527 433 --
Gain on sale of mortgage loans.................... 1,112 27 99
Furniture and equipment........................... 1,752 943 689
Occupancy......................................... 1,523 738 448
Depreciation of operating leases.................. 1,340 394 --
Goodwill amortization............................. 910 358 67
Operating losses.................................. 722 938 144
Supplies.......................................... 489 428 202
</TABLE>

NOTE 18. PARENT COMPANY CONDENSED FINANCIAL INFORMATION:

Following are the condensed financial statements of the Company (parent
company only) for the periods indicated:

BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------
1998 1997
------- -------
(IN THOUSANDS)
<S> <C> <C>
ASSETS:
Cash................................................ $ 1,044 $ 1,555
Investment in subsidiaries.......................... 60,046 53,301
Other assets........................................ 1,707 3,034
------- -------
Total assets.................................... 62,797 57,890

LIABILITIES:
Long-term debt...................................... 13,650 13,650
Other liabilities................................... 1,042 2,169
------- -------
Total liabilities............................... 14,692 15,819

SHAREHOLDERS' EQUITY:............................... 48,105 42,071
------- -------
Total Liabilities and Shareholders' Equity...... $62,797 $57,890
======= =======
</TABLE>

F-21

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

<TABLE>
<CAPTION>
STATEMENTS OF INCOME

YEARS ENDED DECEMBER 31,
---------------------------------
1998 1997 1996
------- ------ ------
(IN THOUSANDS)
<S> <C> <C> <C>
INCOME:
Dividends from subsidiaries......................... $ 1,000 $1,475 $1,600
Total Income.................................... 1,000 1,475 1,600

EXPENSE:
Interest on long-term debt.......................... 1,183 812 828
Personnel expense................................... 1,674 350 42
Other operating expenses............................ 799 248 204
------- ------ ------
Total Expense................................... 3,656 1,410 1,074

Income before income tax benefit and equity in
undistributed income of subsidiaries.............. (2,656) 65 526
Income tax benefit.................................. 1,448 490 430
Income before equity in undistributed income of
subsidiaries...................................... (1,208) 555 956
Equity in undistributed income of subsidiaries...... 5,742 1,860 852
------- ------ ------
Net Income...................................... $ 4,534 $2,415 $1,808
======= ====== ======

<CAPTION>
STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31,
-----------------------------------
1998 1997 1996
------- ------- -------
(IN THOUSANDS)
<S> <C> <C> <C>

OPERATING ACTIVITIES:
Net income.......................................... $ 4,534 $ 2,415 $ 1,808
Adjustment to reconcile net income to net cash
provided by operating activities
Net income of subsidiaries...................... (6,742) (3,335) (2,452)
Dividend from subsidiaries...................... 1,000 1,475 1,600
Other, net...................................... 211 (558) 237
------- ------- -------
Net cash provided by operating activities....... (997) (3) 1,193

INVESTING ACTIVITIES:
Contributions of capital to subsidiaries............ (1,000) (13,979) --
Other, net.......................................... (15) -- --
------- ------- -------
Net cash used by investing activities........... (1,015) (13,979) --

FINANCING ACTIVITIES:
Cash dividends paid................................. (917) (331) (187)
Net issuance of common stock........................ 2,418 12,753 61
Issuance of long-term debt.......................... 13,650 3,000 --
Principal payments on long-term debt................ (13,650) -- (956)
------- ------- -------
Net cash provided (used) by financing
activities.................................... 1,501 15,422 (1,082)
Increase (decrease) in cash and cash equivalents.... (511) 1,440 111
Cash and cash equivalents at beginning of year...... 1,555 115 4
------- ------- -------
Cash and cash equivalents at end of year............ $ 1,044 $ 1,555 $ 115
======= ======= =======
</TABLE>

F-22

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 19. RESTRICTIONS ON SUBSIDIARY DIVIDENDS:

Subsidiary bank dividends are the principal source of funds for payment of
dividends by the Company to its shareholders. The payment of dividends by the
bank is subject to regulation by the Federal Deposit Insurance Corporation. The
state-chartered bank is also subject to regulation by the state of Missouri.
These payments are not restricted as to the amount of dividends that can be
paid, other than what prudent and sound banking principles permit and what must
be retained to meet minimum legal capital requirements. Accordingly,
approximately $11,997,000 could be paid in December 31, 1998 without prior
regulatory approval.

Extensions of credit by subsidiaries to the Company are permitted by
regulatory authorities but are limited in amount and subject to collateral
requirement. At December 31, 1998 approximately, $3,993,000 would have been
available under Federal Reserve Board guidelines.

NOTE 20. SUPPLEMENTAL DISCLOSURE FOR THE CONSOLIDATED STATEMENT OF CASH FLOWS:

Supplemental disclosures of noncash investing and financing activities, and
additional disclosures including details of cash and cash equivalents from
acquisitions accounted for as purchases and dispositions of branches, were as
follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------------------
1998 1997 1996
-------- -------- -------
(IN THOUSANDS)
<S> <C> <C> <C>
Fair value of assets purchased (disposed)................... $ 17,492 $ 46,682 $ --
Liabilities assumed (transferred)........................... (40,154) 119,691 --
Issuance of common stock.................................... -- 10,587 --
-------- -------- -------
Net cash received (paid) for acquisitions and
dispositions.............................................. (22,662) 83,596 --
Cash and cash equivalent acquired........................... -- 1,533 --
-------- -------- -------
$(22,662) $ 85,129 $ --
======== ======== =======

CASH PAID DURING THE YEAR FOR:
Interest on deposits and borrowings..................... $ 28,096 $ 20,930 $14,750
Income taxes............................................ 3,345 2,768 1,393

NONCASH TRANSACTIONS:
Transfers to other real estate owned in settlement of
loans................................................. $ -- $ 330 $ --
Loans securitized....................................... -- 7,102 9,209
Common stock issued in acquisition of Reliance
Financial, Inc........................................ -- 10,587 --
Conversion of subordinate debentures to common stock.... -- -- 504
Conversion of directors' fees to common stock........... 135 136 148
Conversion of employee stock bonus to common stock...... -- 63 --
</TABLE>

F-23

ALLEGIANT BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 21. SUMMARY OF QUARTERLY FINANCIAL INFORMATION (UNAUDITED):

The following is a summary of quarterly operating results for the years
ended December 31, 1998 and 1997:

<TABLE>
<CAPTION>
FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER
------- ------- ------- -------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
1998
Interest income.................................... $12,270 $12,288 $12,452 $12,208
Interest expense................................... 6,841 7,052 6,835 6,539
------- ------- ------- -------
Net interest income............................ 5,429 5,236 5,617 5,669
Provision for loan losses.......................... 400 315 465 1,240
Securities transactions............................ 12 46 4 6
Other income....................................... 1,097 2,130 1,946 4,083
Other expense...................................... 5,118 5,295 5,112 5,770
Income taxes....................................... 393 725 783 1,125
------- ------- ------- -------
Net income..................................... $ 627 $ 1,077 $ 1,207 $ 1,623
======= ======= ======= =======

Earnings per share:
Basic.......................................... $ 0.10 $ 0.17 $ 0.19 $ 0.26
Diluted........................................ 0.09 0.16 0.18 0.25

1997
Interest income.................................... $ 7,536 $ 8,337 $10,124 $11,768
Interest expense................................... 4,374 4,625 5,729 6,738
------- ------- ------- -------
Net interest income............................ 3,162 3,712 4,395 5,030
Provision for loan losses.......................... 493 628 556 720
Securities transactions............................ -- -- 25 (23)
Other income....................................... 636 556 938 1,166
Other expense...................................... 2,303 2,475 3,408 4,883
Income taxes....................................... 401 465 556 294
------- ------- ------- -------
Net income..................................... $ 601 $ 700 $ 838 $ 276
------- ------- ------- -------

Earnings per share:
Basic.......................................... $ 0.17 $ 0.17 $ 0.18 $ 0.02
Diluted........................................ 0.15 0.15 0.17 0.02
</TABLE>

F-24

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

THIS PAGE INTENTIONALLY

LEFT BLANK

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

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

THIS PAGE INTENTIONALLY

LEFT BLANK

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

<PAGE>
<PAGE>
- --------------------------------------------------------------------------------

NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY US OR ANY OF THE UNDERWRITERS. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER
TO BUY, TO ANY PERSON IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS
NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING THE OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER
OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS
CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE HEREOF.

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

TABLE OF CONTENTS

Page
----

Cautionary Statement Regarding
Forward-Looking Statements............ 3
Prospectus Summary......................... 4
Risk Factors............................... 11
Use of Proceeds............................ 17
Capitalization............................. 18
Accounting Treatment....................... 19
Selected Consolidated Financial Data....... 20
Management's Discussion and Analysis of
Financial Condition and Results of
Operations............................ 22
Business................................... 57
Management................................. 65
Beneficial Ownership....................... 67
Allegiant Capital Trust I.................. 68
Description of Trust Preferred
Securities............................ 69
Description of Junior Subordinated
Debentures............................ 82
Description of Guarantee................... 92
Relationship Among the Trust Preferred
Securities, the Junior Subordinated
Debentures and the Guarantee.......... 94
Certain United States Federal Income Tax
Consequences.......................... 96
Certain ERISA Considerations............... 100
Underwriting............................... 100
Validity of Securities..................... 101

Experts.................................... 102

Where You Can Find Additional
Information........................... 102
Index to Financial Statements.............. 103

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

PROSPECTUS JULY 27, 1999
- --------------------------------------------------------------------------------

1,500,000 TRUST PREFERRED SECURITIES

ALLEGIANT CAPITAL
TRUST I

9.875% CUMULATIVE TRUST PREFERRED SECURITIES
(LIQUIDATION AMOUNT $10 PER TRUST
PREFERRED SECURITY)
FULLY AND UNCONDITIONALLY
GUARANTEED AS DESCRIBED HEREIN BY

ALLEGIANT BANCORP, INC.

[Allegiant Bancorp Logo]

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

EVEREN SECURITIES, INC.

WHEAT FIRST SECURITIES

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