2nd Quarter 2010 – Shareholder’s Report The 2nd quarter of 2010 ushered in a new era for your Bank. We completed all of the preparations to make the change in the Bank’s name from First National Bank of Midland to FirstCapital Bank of Texas. So far, the name change has been accepted very well by our customers. We have had very favorable comments and everyone seems to understand the advantages to be gained from the change. We have completed most of the efforts relative to the name change. We still have new signage going up in each of the markets, but all signage should be completed by early August. You have probably noticed the name change marketing campaign that has been running in each market. The campaign has been very effective in getting the message out to our customers and the general public and we have seen the marketing benefits of the increased exposure. Importantly, many more people now understand the Bank is located in Midland, Lubbock and Amarillo. We continue to be the only community bank that serves all three of these major West Texas markets. Recognition The Bank was notified during the 2nd quarter it had been awarded a 5-Star rating by BauerFinancial, Inc., a national bank rating agency which has been rating all banks and credit unions in the country since 1983. The 5-Star rating is the highest rating given by the company and is based upon a thorough financial analysis of each bank. A copy of the Press Release is included in this report. Continued Growth The Bank continues to experience a very strong rate of growth. Total assets have grown from $376 million at year end to $436 million at the end of the 2nd quarter. For the last 12 months, assets have grown by about $85 million, representing a growth rate of 24.08%. Loans have grown from $265 million at June 30, 2009 to $289 million at June 30, 2010. This represents a growth rate of 9.05%. This is slower than the growth rate we had experienced in the past two or three years, however the slow down was planned due to the economic environment. Most banks have seen flat or declining loan volume, so the fact that we experienced an increase indicates that we are still making loans and serving our customers. Earnings Performance Earnings for the 2nd quarter were our best ever. 2nd quarter earnings were $953 thousand as compared to $397 thousand in the first quarter of the year. This enabled the Bank to surpass 2009 earnings through the first 6 months.

The major reasons for the improvement were reduced loan loss provision expense, improved net interest income and a significantly stronger performance from our mortgage division. We expect solid earnings for the remainder of the year and we should experience full year earnings that are significantly higher than 2009. Thank you for your support. Sincerely, Ken L. Burgess, Jr. CEO

CONTACT: BAUERFINANCIAL, Inc.TEL: 1.800.388.6686

FAX: 1.800.230.9569www.bauerfinancial.com

customerservice@bauerfinancial.com

FOR IMMEDIATE RELEASE: To the Editor:

5-Star First National Bank Soars Above the Competition

July 2010: It is with great pride that BAUERFINANCIAL, Inc., Coral Gables, Florida, announces that First National Bank, Midland, Texas has earned its highest 5-Star Superior rating for strength and stability. The past few years have been extremely difficult for the banking industry and the fact that First National Bank continues to excel in such areas as capital adequacy, delinquent loan levels and profitability, clearly indicates it is one of the strongest banks in the country. “With a full ten percent of the nation’s banks now on the FDIC’s “problem” list and even more on ours,” notes Karen L. Dorway, president of BAUERFINANCIAL, “the fact that First National Bank continues to not just withstand the pressures, but even excel in this environment, indicates its management is doing things right. Bauer’s stringent 5-Star requirements haven’t changed, but the climate definitely has and the fact that First National Bank has earned this prestigious rating sets it well above the competition.” First National Bank was established in 1998 and has been serving the banking needs of its neighbors and friends for 12 years. It currently operates through seven conveniently located offices in Amarillo, Lubbock and Midland and can be found on the internet at www.fnbmidland.com. First National Bank: “Banking the Old Fashioned Way!” BAUERFINANCIAL, INC., Coral Gables, Florida, the nation’s leading independent bank and credit union rating and research firm, has been reporting on and analyzing the performance of U.S. banks and credit unions since 1983. No institution pays BauerFinancial to rate it, nor can any choose to be excluded. Consumers may obtain star-ratings by visiting www.bauerfinancial.com.

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BAUERFINANCIAL, INC. P.O. Box 143520, Coral Gables, FL 33114.

Media Release

Financial HighlightsAt and For the Six Months Ended June 30,

2010 2009 Change

Total Assets 436,513$ 351,800$ 24.08%Average Assets 398,841 324,355 22.96%Investments* 128,855 67,667 90.43%Loans, net 285,733 262,042 9.04%Deposits 394,339 316,720 24.51%Shareholders' Equity 36,409 28,194 29.14%Interest Income 9,116 8,474 7.58%Interest Expense 1,565 1,626 -3.75%Net Income 1,350$ 1,217$ 10.93%

Per Share Data:Net Income** 0.16$ 0.17$ Book Value** 4.79$ 4.12$

Ratios:Return on Average Assets 0.66% 0.77%Return on Shareholders' Equity 7.84% 9.23%

Net Interest Margin (tax equivalent basis) 4.08% 4.53%Number of Shareholders (of record)** 377 251

*Includes investment securities, interest bearing deposits and Federal funds sold**Data at the Bank holding company level. All other data shown is at Bank level.

(In Thousands)

Balance Sheet

2010 2009 2009AssetsCASH AND DUE FROM BANKS 7,074$ 8,527$ 10,485$ INVESTMENTS:

Municipal securities 13,474 9,743 10,584 U.S. gov't agencies - 2,998 499 Mortgage backed securities 38,724 26,569 27,827 Due from bank money market accounts 69,124 23,685 41,413 Federal Reserve Bank stock 769 604 604 Federal Home Loan Bank stock 229 228 228 Independent Bank Capital Fund 73 - 38 Texas Independent Bankers Bank Stock 200 200 200

Total Investments 122,593 64,027 81,393 FEDERAL FUNDS SOLD 6,262 3,640 4,734 LOANS:

Real estate 170,404 129,440 157,435 Secondary mortgage 9,837 13,795 8,096 Commercial, industrial, and agricultural 89,749 100,696 81,801 Government entities 5,059 6,451 6,152 Consumer 13,831 14,832 14,376 Other 78 57 55

Total Loans 288,958 265,271 267,915 Less - Allowance for possible loan losses (3,225) (3,229) (3,159)

Loans, net 285,733 262,042 264,756 BANK PREMISES AND EQUIPMENT, NET 9,755 10,448 10,019 OTHER ASSETS 5,096 3,116 4,947

TOTAL ASSETS 436,513$ 351,800$ 376,334$

Liabilities & Shareholders' EquityDEPOSITS:

Demand 100,584$ 81,983$ 93,289$ NOW Accounts 27,925 23,620 26,030 Savings 8,119 6,641 5,860 Time 197,391 146,632 164,181 CDARS 60,320 57,844 50,500

Total Deposits 394,339 316,720 339,860 SHORT-TERM BORROWINGS

Federal funds purchased - - - Securities sold under agreement to repurchase 4,381 5,876 5,821 Federal Home Loan Bank borrowings - - -

Total short-term borrowings 4,381 5,876 5,821 ACCRUED EXPENSES AND OTHER LIABILITIES 1,384 1,010 772

Total Liabilities 400,104 323,606 346,453 SHAREHOLDER'S EQUITY

Common Stock 3,096 3,096 3,096 Surplus 22,546 17,046 17,546 Retained earnings 10,767 8,052 9,239

Total shareholders' equity 36,409 28,194 29,881 TOTAL LIABILITIES AND SHAREHOLDERS'

EQUITY 436,513$ 351,800$ 376,334$

December 31,

First National Bank of Midland(Unaudited Bank Subsidiary Only)

(In Thousands)

June 30,

Statement of IncomeFor the Six Months Ended June 30,

2010 2009

Interest Income:Interest and fees on loans 8,155$ 7,554$ Interest on investment securities 770 871 Interest on Federal funds sold 24 9 Other interest income 167 40

TOTAL INTEREST INCOME 9,116 8,474

Interest Expense:Deposits 1,550 1,590 Short-term borrowings 15 36

TOTAL INTEREST EXPENSE 1,565 1,626

Net Interest Income 7,551 6,848 Provision for possible loan losses 1,100 900

Net Interest Income After ProvisionFor Possible Loan Losses 6,451 5,948

Other Income:Mortgage 1,745 1,906 Trust, net 85 102 Other income 528 494

TOTAL OTHER INCOME 2,358 2,502

Other Expenses:Salary and employee benefits 3,847 3,826 Building occupancy expense 1,084 1,070 Marketing expense 142 115 Data processing expense 174 150 Other employee expense 141 118 Regulatory expense 345 364 Other expenses 1,174 1,073

TOTAL OTHER EXPENSES 6,907 6,716

Income Before Income Taxes 1,902 1,734 Provision for income taxes 552 517

NET INCOME 1,350$ 1,217$

(In Thousands)

First National Bank of Midland(Unaudited Bank Subsidiary Only)

Bank Officers

Michael J. Canon Shea EdwardsChairman of the Board Banking Officer & Team Resources Representative

Kenneth L. Burgess, Jr. Rodger L. HortonChief Executive Officer & President Banking Officer & Sr. Credit Analyst

Kathy MirelesMidland Market - Banking Officer & Teller Supervisor

Jay W. Isaacs Veronica S. PylePresident – Midland Market & Sr. Trust Officer Banking Officer & Relationship Services Representative

Brad D. Bullock, CRCM Chris A. WhitneyExecutive Vice President & Sr. Compliance Officer Banking Officer, Branch Manager & Personal Banker

Bill J. HillSr. Vice President & Trust Administration Officer Amarillo Market -

Toby D. Payne J. Greg BurgessSr. Vice President & Sr. Relationship Manager President - Amarillo Market & Chief Lending Officer

Robin Richey George H. ReevesSr. Vice President, Secretary to the Board & Trust Administration Officer Executive Vice President & Chief Operations Officer

Lynne M. Sawyer Anita K. FinkSr. Vice President & Relationship Services Manager Vice President, Operations

Shannon L. Smith Dora M. EvansSr. Vice President & Sr. Relationship Manager Assistant Vice President & Credit Administration Manager

Tracy A. Timlin Landon M. GannSr. Vice President & Mortgage Division Manager Assistant Vice President & Relationship Manager

Janene D. Binnion, PHR Kenneth L. Burgess, IIIVice President & Team Resources Manager Banking Officer & Sr. Credit Analyst

Jon D. Black Stacye M. WorthenVice President, Odessa Mortgage Manager Banking Officer & Branch Manager

R. Kyle CliftonVice President, Cashier & Controller Lubbock Market -

Debbie K. Glennan Brad D. BurgessVice President & Branch Operations Manager President - Lubbock Market & Sr. Relationship Manager

Chris L. McGinnis David R. QuintanillaVice President & IT Manager Executive Vice President & Sr. Relationship Manager

Jeremy M. Bishop Tony PenaAssistant Vice President & Relationship Manager Sr. Vice President & Sr. Relationship Manager

Melanie J. Horton Lisha F. KingAssistant Vice President & Assistant Controller Vice President & Branch Operations Manager

Martin F. Ruehl Cindi LeaAssistant Vice President, Branch Manager & Relationship Manager Vice President & Lubbock Mortgage Manager

Katie J. Boyd Beverly R. HollandBanking Officer & Compliance Specialist Assistant Vice President & Relationship Services Manager

Griselda J. Bujanda Raina KenedaBanking Officer & Loan Operations Manager Assistant Vice President & Credit Administration Manager

Michael J. Canon, Jr. Brady CampbellBanking Officer & IT Specialist Banking Officer & Sr. Credit Analyst

Rachel CoxBanking Officer & Sr. Credit Analyst

Bank Directors Michael J. Canon Chairman of the Board

Kenneth L. Burgess, Jr. Chief Executive Officer & President

Jay W. Isaacs President – Midland Market & Sr. Trust Officer

J. Greg Burgess President – Amarillo Market & Chief Lending Officer

Brad D. Burgess President – Lubbock Market & Sr. Relationship Manager

George H. Reeves Executive Vice President & Chief Operations Officer

David R. Quintanilla Executive Vice President & Sr. Relationship Manager

Breck Colquett Owner, B.C. Supply

John D. Bergman Oil & Gas Independent

Cary Billingsley Independent Petroleum Engineer

Stephen N. Castle Oil & Gas Independent

Dr. David Daniel Retired, former Midland College President

A. Scott Dufford Oil & Gas Independent

J. Gaut Commercial Real Estate Broker

H. Tevis Herd Attorney at Law

Robert C. Leibrock Oil & Gas Independent

Chris Matthews Investments

Subodh I. Patel Hospitality Industry

C. Todd Sparks Vice President & CFO, Discovery Operating, Inc.

Dr. James Welsh Physician

Terry D. Wilkinson Investments