With an emphasis on credit quality, our examination of individual loans addresses the following:

Origin, purpose and special terms of the financing package.

The nature and present value of collateral. This includes a review of any appraisals and discussion of any areas of concern regarding the final value estimate, including comment on methodology, comparables utilized, capitalization rates used, etc. Appraised value is also discounted in accordance with any market changes that may have occurred since the time of the report. Current cash flow analysis of the property is also conducted based on the most current data available in file with Bennington's estimate of collateral value supported by this analysis.

The financial condition of all obligors associated with the credit, with a particular emphasis on liquidity, debt service capacity and fallback potential. The analysts spread the most recent financial data in file, and each review includes the actual spreads, corporate debt service analysis and real estate debt service analysis as well as a narrative description of the obligors' financial condition.

Adequacy and timeliness of file documentation, including closing and subsequent legal documents.

Each exposure is risk rated by our field personnel utilizing the risk rating system currently in use at your bank. All risk ratings are reviewed and finalized by the partners. Prior to finalizing ratings and Bennington's management letter, the Bank is provided with a draft of the individual reviews and given the opportunity to discuss any questions or concerns with the partners.

The bank is provided with a management letter at the completion of Bennington's review which summarizes the following: The scope of the review including percentage of penetration within the portfolio. Findings with respect to technical exceptions (i.e. currency of data, adequacy of officer follow-up, etc.). Findings with respect to the risk rating profile of the portfolio. General observations with regard to file maintenance, underwriting practices or other areas that warrant comment based on our observations.

Risk Classification Report - indicates for each risk rating category the total balances of loans in the category and the percentage of the reviewed loans that each category represents.

Delta Report - Compares, for each loan review, the risk ratings assigned by the bank against risk ratings assigned by Bennington.

Officer Task List - Provides for each officer a list of missing items for each loan.

Loan Type Risk Summary - Summarizes different types of loan by risk rating.

Summary Report by Lender and Class - Provides necessary information to analyze individual lender performance.

Review Category Report - Highlights areas of relationship/loan management in which there are strengths and weaknesses.

Compliance Report - Comments on items of non-compliance with specific Bank policies, as well as with certain regulatory requirements

The above-described reports represent the standard reports automatically generated from the database created for the bank. Reports may be modified, or additional reports added, to fit the bank's specific needs.

Individual loan reviews for each exposure are also included with the final package.

All reports are available in electronic format.

The partners make themselves available for meetings with senior management and/or the board after the management reports are finalized, as requested by the bank.

Loan Policies and Procedures
Bennington Partners as an organization is dedicated to working closely with key members of senior management of smaller banks to maximize the mandates of their Boards of Directors.

Bennington Partners because of their vast experience in, and understanding of lending matters can provide extremely competent assistance in all areas pertaining to loans.

The Bennington Lending Program is a system designed to help banks move into the current, stringent regulatory environment. Bennington Partners after consultation with appropriate Bank personnel will devise, review and/or supplement as needed appropriate loan manuals that marry your bank's unique character with the dictates of sound lending and the requirements of the regulatory authorities.

As an additional feature of this program, Bennington will assist with the implementation of these policies and through a periodic maintenance review provide management with the tools to help insure sound and conservative lending practices on an ongoing basis. The scope of the Bennington Lending Program review would typically include such categories as:

w Review with management desired scope w Ratings on each loan using standardized classifications w Analysis of each loan as to: Industry features Management evaluation Balance sheet strengths and weaknesses Collateral evaluation Appraisal reviews Income statement evaluation Debt service capacity Cash flow forecasts Guarantors strength Currency of financial data Adherence to approval conditions

w Documentation Review Appropriate bank forms in file UCC I and UCC II filed properly Insurance in force Loan and security agreements Receipt of recorded mortgage documents w Management Reports Observations on condition of portfolio Individual loan evaluations with specific recommendations to improve the credits Review of portfolios with responsible officers In depth reviews with Senior Managers