SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------------------------
FORM 11-K
|X| Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the fiscal year ended December 31, 1996
|_| Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Commission file number 0-21078
A. Union Bankshares, Ltd. Profit Sharing 401(k) Plan
B. Union Bankshares, Ltd.
1825 Lawrence Street, Suite 444
Denver, Colorado 80202
(303) 298-5352
<PAGE>
UNION BANKSHARES, LTD.
PROFIT-SHARING 401(K) PLAN
ACCOUNTANTS' REPORT AND
FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN
DECEMBER 31, 1996 AND 1995
TABLE OF CONTENTS
PAGE
INDEPENDENT ACCOUNTANTS' REPORT 4
FINANCIAL STATEMENTS
Statements of Net Assets Available for Benefits 5
Statements of Changes in Net Assets Available for Benefits 6
Notes to Financial Statements 9
SUPPLEMENTARY INFORMATION
Item 27a - Schedule of Assets Held for Investment Purposes 15
Item 27d - Schedule of Reportable Transactions 16
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<PAGE>
INDEPENDENT ACCOUNTANTS' REPORT
To the Board of Trustees
Union Bankshares, Ltd. Profit-Sharing 401(k) Plan
Denver, Colorado
We have audited the accompanying statements of net assets available for benefits
of UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN for the years ended
December 31, 1996 and 1995, and the related statements of changes in net assets
available for benefits for the years then ended. These financial statements are
the responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of UNION
BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN as of December 31, 1996 and 1995,
and the changes in net assets available for benefits for the years then ended in
conformity with generally accepted accounting principles.
The accompanying supplemental schedules as of or for the year ended December 31,
1996, are presented for purposes of complying with the Department of Labor's
Rules and Regulations for Reporting and Disclosure under the Employee Retirement
Income Security Act of 1974 and are not a required part of the basic financial
statements. The supplemental schedules have been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, are fairly stated, in all material respects, in relation to the basic
financial statements taken as a whole.
June 24, 1997 /s/ Baird, Kurtz & Dobson
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
(WITH FUND INFORMATION)
DECEMBER 31, 1996 AND 1995
<TABLE>
<CAPTION>
1996
--------------------------------------------------------------------------------------------
NON-
PARTICIPANT
DIRECTED PARTICIPANT DIRECTED
----------- --------------------------------------------------------------------
AMERICAN FUNDS
-------------------------------------------------------
UNION UNION
BANKSHARES, BANKSHARES, CASH
LTD. LTD. NEW INVESTMENT INCOME BOND MANAGEMENT
COMMON COMMON PERSPECTIVE COMPANY OF FUND OF FUND OF TRUST OF
STOCK STOCK FUND AMERICA AMERICA AMERICA AMERICA TOTAL
----------- ----------- ------------ ---------- ---------- ---------- --------- -----------
ASSETS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENTS, At Fair Value
Union Bankshares, Ltd. common stock $ 932,912 $ 275,365 $ - $ - $ - $ - $ - $1,208,277
The American Funds Group mutual
funds:
New Perspective Fund - - 347,925 - - - - 347,925
Investment Company of America - - - 333,955 - - - 333,955
Income Fund of America - - - - 372,518 - - 372,518
Bond Fund of America - - - - - 89,764 - 89,764
Cash Management Trust of America - - - - - - 390,869 390,869
----------- ---------- ----------- --------- ---------- ---------- -------- ----------
932,912 275,365 347,925 333,955 372,518 89,764 390,869 2,743,308
----------- ---------- ----------- --------- ---------- ---------- -------- ----------
EMPLOYER CONTRIBUTION
RECEIVABLE 121,119 - - - - - - 121,119
----------- ---------- ----------- --------- ---------- ---------- -------- ----------
CASH 1,819 - 1,376 411 20 358 342 4,326
----------- ---------- ----------- --------- ---------- ---------- -------- ----------
NET ASSETS AVAILABLE FOR
BENEFITS $ 1,055,850 $ 275,365 $ 349,301 $ 334,366 $ 372,538 $ 90,122 $391,211 $2,868,753
=========== ========== =========== ========= ========== ========== ======== ==========
</TABLE>
See Notes to Financial Statements
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
(WITH FUND INFORMATION)
DECEMBER 31, 1996 AND 1995
<TABLE>
<CAPTION>
1996
--------------------------------------------------------------------------------------------
NON-
PARTICIPANT
DIRECTED PARTICIPANT DIRECTED
----------- --------------------------------------------------------------------
AMERICAN FUNDS
-------------------------------------------------------
UNION UNION
BANKSHARES, BANKSHARES, CASH
LTD. LTD. NEW INVESTMENT INCOME BOND MANAGEMENT
COMMON COMMON PERSPECTIVE COMPANY OF FUND OF FUND OF TRUST OF
STOCK STOCK FUND AMERICA AMERICA AMERICA AMERICA TOTAL
----------- ----------- ------------ ---------- ---------- ---------- --------- -----------
ASSETS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENTS, At Fair Value
Union Bankshares, Ltd. common stock $399,000 $161,791 $ - $ - $ - $ - $ - $ 560,791
The American Funds Group mutual funds:
New Perspective Fund - - 260,082 - - - - 260,082
Investment Company of America - - - 381,583 - - - 381,583
Income Fund of America - - - - 220,255 - - 220,255
Bond Fund of America - - - - - 73,167 - 73,167
Cash Management Trust of America - - - - - - 448,147 448,147
-------- -------- -------- -------- ------- ------- -------- ----------
399,000 161,791 260,082 381,583 220,255 73,167 448,147 1,944,025
-------- -------- -------- -------- ------- ------- -------- ----------
EMPLOYER CONTRIBUTION
RECEIVABLE 89,158 - - - - - - 89,158
-------- -------- -------- -------- -------- ------- -------- ----------
TRANSFER RECEIVABLE (PAYABLE) - 69,283 1,133 (134,873) 144,770 (286) (80,027) -
-------- -------- -------- -------- -------- ------- -------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $488,158 $231,074 $261,215 $246,710 $365,025 $72,881 $368,120 $2,033,183
======== ======== ======== ======== ======== ======= ======== ==========
</TABLE>
See Notes to Financial Statements
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
(WITH FUND INFORMATION)
YEARS ENDED DECEMBER 31, 1996 AND 1995
<TABLE>
<CAPTION>
1996
--------------------------------------------------------------------------------------------
NON-
PARTICIPANT
DIRECTED PARTICIPANT DIRECTED
----------- --------------------------------------------------------------------
AMERICAN FUNDS
-------------------------------------------------------
UNION UNION
BANKSHARES, BANKSHARES, CASH
LTD. LTD. NEW INVESTMENT INCOME BOND MANAGEMENT
COMMON COMMON PERSPECTIVE COMPANY OF FUND OF FUND OF TRUST OF
STOCK STOCK FUND AMERICA AMERICA AMERICA AMERICA TOTAL
----------- ----------- ------------ ---------- ---------- ---------- --------- -----------
ASSETS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Net appreciation (depreciation) in
fair value of investments $ 260,281 $ 75,341 $ 30,181 $ 37,016 $ 11,888 $ (396) $ - $ 414,311
Interest and dividends 546 158 18,106 19,767 35,940 5,848 18,776 99,141
---------- --------- ---------- --------- --------- --------- --------- ----------
260,827 75,499 48,287 56,783 47,828 5,452 18,776 513,452
---------- --------- ---------- --------- --------- --------- --------- ----------
CONTRIBUTIONS
Employer 177,105 - - - - - - 177,105
Employee - 29,004 35,992 48,649 22,378 2,635 9,468 148,126
---------- --------- ---------- --------- --------- --------- --------- ---------
177,105 29,004 35,992 48,649 22,378 2,635 9,458 325,231
---------- --------- ---------- --------- --------- --------- --------- ---------
Total additions 437,932 104,503 84,279 105,432 70,206 8,087 28,244 838,683
---------- --------- --------- --------- --------- --------- --------- ---------
BENEFITS PAID TO PARTICIPANTS 1,141 90 1,689 193 - - - 3,113
---------- --------- --------- --------- --------- --------- --------- ---------
TRANSFERS 130,901 (60,122) 5,496 (17,583) (62,693) 9,154 (5,153) -
---------- --------- --------- --------- --------- --------- --------- ---------
NET INCREASE 567,692 44,291 88,086 87,656 7,513 17,241 23,091 835,570
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 488,158 231,074 261,215 246,710 365,025 72,881 368,120 2,033,183
---------- --------- --------- --------- --------- --------- --------- ---------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $1,055,850 $ 275,365 $ 349,301 $ 334,366 $ 372,538 $ 90,122 $ 391,211 $2,868,753
========== ========= ========= ========= ========= ========= ========= ==========
</TABLE>
See Notes to Financial Statements
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
(WITH FUND INFORMATION)
YEARS ENDED DECEMBER 31, 1996 AND 1995
<TABLE>
<CAPTION>
1996
--------------------------------------------------------------------------------------------
NON-
PARTICIPANT
DIRECTED PARTICIPANT DIRECTED
----------- --------------------------------------------------------------------
AMERICAN FUNDS
-------------------------------------------------------
UNION UNION
BANKSHARES, BANKSHARES, CASH
LTD. LTD. NEW INVESTMENT INCOME BOND MANAGEMENT
COMMON COMMON PERSPECTIVE COMPANY OF FUND OF FUND OF TRUST OF
STOCK STOCK FUND AMERICA AMERICA AMERICA AMERICA TOTAL
----------- ----------- ------------ ---------- ---------- ---------- ---------- ---------
ASSETS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Net appreciation (depreciation) in
fair value of investments $ 133,601 $ 49,723 $ 27,403 $ 54,746 $ 37,022 $ 8,210 $ - $ 310,705
Interest and dividends 108 33 13,549 22,590 13,725 7,340 24,301 81,646
--------- --------- --------- --------- --------- --------- --------- ----------
133,709 49,756 40,952 77,336 50,747 15,550 24,301 392,351
--------- --------- --------- --------- --------- --------- --------- ----------
CONTRIBUTIONS
Employer 132,011 - - - - - - 132,011
Employee - 14,238 26,006 39,879 14,821 2,088 10,404 107,436
--------- --------- --------- --------- --------- --------- --------- ----------
132,011 14,238 26,006 39,879 14,821 2,088 10,404 239,447
--------- --------- ---------- --------- --------- --------- --------- ----------
Total additions 265,720 63,994 66,958 117,215 65,568 17,638 34,705 631,798
--------- --------- --------- --------- --------- --------- --------- ----------
BENEFITS PAID TO PARTICIPANTS - 1,280 5,211 - - - - 6,491
--------- --------- --------- --------- --------- --------- --------- ----------
TRANSFERS 8,597 89,391 10,384 (97,862) 129,966 (64,573) (75,903) -
--------- --------- --------- --------- --------- --------- --------- ----------
NET INCREASE (DECREASE) 274,317 152,105 72,131 19,353 195,534 (46,935) (41,198) 625,307
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 213,841 78,969 189,084 227,357 169,491 119,816 409,318 1,407,876
--------- --------- --------- --------- --------- --------- --------- ----------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $ 488,158 $ 231,074 $ 261,215 $ 246,710 $ 365,025 $ 72,881 $ 368,120 $2,033,183
========= ========= ========= ========= ========= ========= ========= ==========
</TABLE>
See Notes to Financial Statements
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
NOTE 1: SIGNIFICANT ACCOUNTING POLICIES
VALUATION OF INVESTMENTS
Investments are carried at their current value, which is the quoted market price
on the last business day of the plan year.
PAYMENTS OF BENEFITS
Benefits are recorded when paid.
INCOME TAX STATUS
The Trust established under the Plan to hold the Plan's assets is qualified
pursuant to the appropriate section of the Internal Revenue Code and,
accordingly, the Trust's net investment income is exempt from income taxes. The
Plan has obtained a favorable tax determination letter from the Internal Revenue
Service (May 4, 1994) and the Plan sponsor believes that the Plan continues to
qualify and to operate as designed.
USE OF 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 those estimates.
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
NOTE 2: PLAN DESCRIPTION
The following description of the Plan provides only general information.
Participants should refer to the Plan document for a more complete description
of the plans provisions.
GENERAL
The Plan is a defined contribution plan covering eligible employees of Union
Bankshares, Ltd., and its subsidiaries ("Company"). The Plan was created and
maintained for the purpose of enabling eligible employees and their
beneficiaries to share in Company profits. It is subject to the provisions of
the Employee Retirement Income Security Act of 1974 (ERISA).
PARTICIPATION
Any employee who has attained the age of 21 years, who has completed 1,000 hours
of service and has been employed by the Company for a full year shall be
eligible to participate in the Plan.
PARTICIPANT ACCOUNTS
The Plan administrator maintains an account or accounts for each participant.
Each participant's account is credited with the participant's contribution and
allocation of (a) the Company's contribution, (b) forfeitures and (c) Plan
earnings. Allocations are based on participant earnings or account balances, as
defined. The benefit to which a participant is entitled is the benefit that can
be provided from the participant's vested account.
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
NOTE 2: PLAN DESCRIPTION (continued)
VESTING
Participants are vested immediately in their voluntary contribution plus
earnings thereon. Vesting in the remainder of their account is as follows:
Vested
YEARS OF SERVICE PERCENTAGE
Less than 2 years 0%
2 but less than 3 years 20%
3 but less than 4 years 40%
4 but less than 5 years 60%
5 but less than 6 years 80%
6 years and thereafter 100%
No vesting credit will be allowed when an employee incurs a "break in service",
defined as a Plan year in which less than 500 hours are worked. Therefore,
vesting with respect to employees with a "break in service" is determined at
each Plan year-end. Participants will become 100% vested at normal retirement
age, total disability, or death.
DISTRIBUTION OF BENEFITS
The Trustees of the Plan, at the written request of the Plan Committee, shall
execute all required documents to make a distribution of benefits as provided by
the Plan. Total vested benefits will be determined by the full value of each
participant's account upon distribution for any of the above reasons. Payments
may be made in a lump sum, installments or by some other method.
CONTRIBUTION AND FUNDING
Eligible participants may make voluntary contributions to the Plan provided
that any voluntary contributions for all plans in which an employee may
participate do not exceed 15% of the participants' compensation. Voluntary
contributions may be restricted in amount by other provisions of the Plan.
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
NOTE 2: PLAN DESCRIPTION (continued)
CONTRIBUTION AND FUNDING (continued)
The Company contributes an amount equal to 50% of the participants' voluntary
contribution up to a maximum of 3% of the participant's annual compensation. In
addition, each plan year the Company makes an additional profit-sharing
contribution. During 1996 and 1995, the Company made profit-sharing
contributions of $117,050 and $87,869, respectively. All Company contributions
are invested in the common stock of the Company.
PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA. In the event of Plan termination,
participants will become 100% vested in their accounts.
INVESTMENT OPTIONS
Upon enrollment in the Plan, a participant may direct employee contributions in
any of six investment options. All employer contributions are invested in the
common stock of the Company.
Union Bankshares, Ltd., common stock - Funds are invested in the common
stock of Union Bankshares, Ltd.
New Perspective Fund - A global growth fund.
Investment Company of America - A conservative domestic growth fund.
Income Fund of America - A balanced fund of stocks, bonds, and cash.
Bond Fund of America - Fixed income fund of corporate and government bonds.
Cash Management Trust of America - A money market fund.
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
NOTE 3: INVESTMENTS
Plan investments are summarized as follows:
<TABLE>
<CAPTION>
DECEMBER 31, 1996 DECEMBER 31, 1995
-------------------------------- ----------------------------------
NUMBER OF NUMBER OF
SHARES OR SHARES OF
PRINCIPAL PRINCIPAL
AMOUNT FAIR VALUE AMOUNT FAIR VALUE
-------------- --------------- -------------- -----------------
<S> <C> <C> <C> <C>
Common Stock, Union Bankshares, Ltd. 73,787 $ 1,208,277 47,505 $ 560,791
American Fund Mutual Funds:
New Perspective Fund 19,148 347,925 15,878 260,082
Investment Company of America 13,783 333,955 17,658 381,583
Income Fund of America 22,549 372,518 13,879 220,255
Bond Fund of America 6,528 89,764 5,271 73,167
Cash Management Trust of America 390,869 390,869 448,147 448,147
------------- -------------
$ 2,743,308 $ 1,944,025
============= =============
</TABLE>
The net change in the fair value of the Plan's investments, including
investments bought, sold and held during the years ended December 31, 1996 and
1995, are as follows:
1996 1995
---------------- ----------------
Common Stock, Union Bankshares, Ltd. $ 335,622 $ 183,324
Mutual Funds 78,689 127,381
---------------- ----------------
$ 414,311 $ 310,705
================ ================
NOTE 4: ADMINISTRATIVE COSTS
Certain administrative functions are performed by officers or employees of the
Company. No such officer or employee receives compensation from the Plan. The
Company pays for all administrative costs of the Plan. These amounts are
considered insignificant to the Plan as a whole.
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<PAGE>
SUPPLEMENTARY INFORMATION
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING PLAN AND TRUST
ITEM 27A - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1996
SHARES OR
PRINCIPAL MARKET OR
AMOUNT FAIR VALUE
---------------- ------------------
Common Stock, Union Bankshares, Ltd. 73,787 $ 1,208,277
American Funds:
New Perspective Fund 19,148 347,925
Investment Company of America 13,783 333,955
Income Fund of America 22,549 372,518
Bond Fund of America 6,528 89,764
Cash Management Trust of America 390,869 390,869
------------------
Total Investments $ 2,743,308
==================
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<PAGE>
UNION BANKSHARES, LTD. PROFIT-SHARING PLAN AND TRUST
ITEM 27D - SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
NUMBER OF NUMBER OF
PURCHASES TOTAL VALUE SALES NET SELLING TOTAL COST OF
DESCRIPTION OF ASSETS TRANSACTIONS OF PURCHASES TRANSACTIONS PRICE ASSETS SOLD NET GAIN
- ----------------------------------------------- ------------ ------------ ------------ ----------- -------------- --------
Series of transactions involving securities
of the same issue that, in the aggregate,
exceed 5% of the plan assets for the
beginning of the plan year:
<S> <C> <C> <C> <C> <C> <C>
Common Stock, Union Bankshares, Ltd. Various $206,109 $ - $ - $ - $ -
</TABLE>
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees have duly caused this annual report to be signed on their behalf by the
undersigned thereunto duly authorized.
UNION BANKSHARES, LTD. PROFIT SHARING
401(k) PLAN
Date: September 30, 1997 By /s/ Herman J. Zueck
--------------------------------------
Name: Herman J. Zueck
Title: Trustee
Date: September 30, 1997 By /s/ Charles R. Harrison
--------------------------------------
Name: Charles R. Harrison
Title: Trustee
Date: September 30, 1997 By /s/ Bruce E. Hall
--------------------------------------
Name: Bruce E. Hall
Title: Trustee
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<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
23.1 Consent of Baird, Kurtz & Dobson
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<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in Form S-8 of our report on the
financial statements included in the annual report on Form 11-K of Union
Bankshares, Ltd. Profit Sharing 401(k) Plan for the year ended December 31,
1996.
/s/ Baird, Kurtz & Dobson
September 29, 1997
Denver, Colorado,
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