CONDENSED STATEMENTS OF INCOME YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000 CONDENSED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000 59 (dollars in thousands) 2002 2001 2000 Cash Flows from Operating Activities Net income $18,453 $ 14,508  $12,975  Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 12  – – Increase in equity in net income of subsidiaries (1,346) (236)(4,345) Noncash compensation expense 596 479  579  Other, net 186  2,955  (2,355) Net Cash Provided by Operating Activities 17,901  17,706  6,854  Cash Flows from Investing Activities Purchases of premise and equipment (223) – – Net Cash Used in Investing Activities (223) – – Cash Flows from Financing Activities Dividends paid to shareholders (4,066) (3,981)(3,817) Capital contributed to subsidiaries (123) (152)(175) Proceeds from long-term debt 10,000 – 4,650  Repayments of long-term debt – (9,225)(3,000) Net change in short-term borrowings (4,250) 4,250  – Payments received from ESOP 500  578  655  Payments to repurchase common stock  (12,644) (8,414)(5,377) Proceeds from sale of treasury stock 701 283  – Net Cash Used in Financing Activities (9,882) (16,661)(7,064) Net Increase (Decrease) in Cash and Cash Equivalents 7,796  1,045  (210) Cash and Cash Equivalents at Beginning of Period 1,756  711  921  Cash and Cash Equivalents at End of Period $ 9,552  $ 1,756  $ 711 (dollars in thousands) 2002 2001 2000 Operating income Dividends from subsidiaries $18,000 $15,050  $ 9,600  Interest income 24 29  45  Total operating income 18,024  15,079  9,645  Operating expenses Interest expense 152 172  563  Other expenses 1,241  1,049  1,072  Total operating expenses 1,393  1,221  1,635  Income before income tax expense and increase in equity in undistributed earnings of subsidiaries 16,631  13,858  8,010  Income tax benefit 476 414  620  Income before increase in equity in undistributed earnings of subsidiaries 17,107 14,272  8,630  Increase in equity in undistributed earnings of subsidiaries 1,346  236  4,345  Net Income $18,453  $14,508  $12,975 