text: **Balance Sheet Review**
  
  *Loans*. The loan portfolio is comprised of loans made to businesses, individuals, and farm and ranch operations 
  located in the primary trade areas served by our subsidiary banks. Real estate loans represent loans primarily for 
  new home construction and owner-occupied real estate. The structure of loans in the real estate mortgage 
  classification generally provides repricing intervals to minimize the interest rate risk inherent in long-term fixed rate 
  mortgage loans. As of December 31, 2002, total loans were $964.0 million, an increase of $23.9 million, as 
  compared to December 31, 2001. As compared to year-end 2001, real estate loans increased $28.6 million and 
  consumer loans decreased $4.4 million. Commercial, financial and agricultural loans as of year-end 2002 were 
  virtually unchanged from one year ago. Loans averaged $942.1 million during 2002, an increase of $44.5 million 
  over the prior year average. 