MERCANTILE WILL ACQUIRE CENTRAL MISSOURI BANK

Mercantile Bancorporation Inc., headquartered in St. Louis, has announced plans to strengthen its presence in Central Missouri via a merger with First Financial Corporation of America, a Salem-based bank-holding company.

First Financial operates First National Bank of Salem, an $85 million asset bank located about 25 miles southeast of Rolla.

Mercantile plans to establish First National Bank of Salem as a separate community bank within the soon-to-be consolidated Mercantile Bank of Central Missouri charter.

"The transaction with First Financial is a logical expansion of Mercantile's franchise in Central Missouri," said John H. Beirise, Mercantile's Group President-Emerging Markets. "The bank is the market leader in Dent County and adds another strong organization to our growing multi-state system."

Salem is the county seat of Dent County, which is noted as a food service distribution center and for its recreation and tourism industries.

Mercantile is an $18 billion holding company with banks in Missouri, Iowa, Kansas, Illinois and Arkansas. Two additional mergers are pending, with Today's Bancorp in northwestern Illinois and Peoples State Bank in Topeka, Kan. Today's Bancorp has $510 million in assets and Peoples State Bank has $94 million in assets.

According to the latest agreement, Mercantile will buy First Financial through a combination of common stock and cash totaling $14.98 million. The exchange ratio will be 4.2 shares of Mercantile common stock, or $194.73, per share.

The transaction will be accounted for as a purchase and all shares issued may be repurchased in the open market. The merger is subject to the approval of First Financial Corporation of America shareholders and all appropriate regulatory authorities.

Mercantile Bancorporation includes holdings in Southeast Missouri at Cape Girardeau and Sikeston. Mercantile completed the purchase of AmeriFirst Bank, headquartered at Sikeston, in October of last year.