Corpor ate InformatIon

town and Country financial Corporation is the parent holding company for town and Country Bank with offices in Springfield, mt. Zion, forsyth, and Decatur, town & Country Banc mortgage Services, Inc., and Logan County Bank with offices in Lincoln and Buffalo. town and Country financial Corporation shares are traded under the symbol tWCf.

TRANSFER AGENTtown and Country financial Corporation acts as its own transfer agent. Contact us by calling 866.770.3100 with questions on registrations or stock transfer instructions. mail requests to our Corporate office at the following address:

town and Country financial Corporation3601 Wabash aveSpringfield, IL 62711www.townandcountrybank.com

Statement of Condition

2011 thIrD Quarter

STATEmENT oF CoNdiTioNas of September 30 (unaudited) 2011 2010

ASSetSCash and due from banks $ 12,302,154 $ 15,575,487 Investments 102,028,575 103,961,370 Loans, net 242,227,044 224,796,084 Other assets 20,062,514 19,909,939 Total assets $ 376,620,287 $ 364,242,880

LiAbiLitieS & equityDeposits $ 308,376,967 $ 296,821,111 Borrowed money 18,198,810 24,055,072 Other liabilities 961,047 940,178 Total liabilities 327,536,824 321,816,361 Trust preferred securities 11,500,000 11,500,000 Equity capital 37,583,463 30,926,519 Total liabilities & equity $ 376,620,287 $ 364,242,880

NiNe MoNth Period eNded SePteMber 30 (uNAudited)Interest income $ 11,992,224 $ 12,619,966 Interest expense (2,481,717) (3,772,489)Net interest income $ 9,510,507 $ 8,847,477 Provision for loan losses – (585,416)Noninterest income 3,789,370 3,946,761 Gain on sale of securities 195,856 74,824 Writedown due to impairment of securities – (278,600)Noninterest expense (10,395,099) (10,216,162)

Income before income taxes $ 3,100,634 $ 1,788,884 Income taxes (1,039,500) (433,600)Net income $ 2,061,134 $ 1,355,284

SElECTEd FiNANCiAl CompARiSoNNiNe MoNth Period eNded SePteMber 30 (uNAudited)Net income before nonrecurring items per share $ 0.70 $ 0.53 Net income from nonrecurring items per share $ 0.04 $ (0.04)Basic earnings per share $ 0.74 $ 0.49 Net charge offs to average loans -0.03% 0.13%Basic surplus (cash and liquid securities less short/volatile liabilities as % of total assets) 14.40% 15.30%Net revenue excluding nonrecurring (in millions) $ 13.3 $ 12.8 Net interest margin 3.76% 3.56%Return on equity 8.46% 6.05%Return on assets 0.75% 0.50%

AS of AS of SePteMber 30 deceMber 31 (unaudited) 2011 2010Tier 1 leverage ratio 13.1% 10.9%Total risk-based capital ratio 16.7% 15.1%Nonperforming loans 0.62% 0.40%Delinquent loans, excluding nonperforming 0.21% 0.75%Allowance for loan loss 1.25% 1.32%Mortgage loans sold with servicing retained (in millions) $ 352.7 $ 340.6Trust assets under management (in millions) $ 64.0 $ 67.7

dEAR FEllow ShAREholdERS,

the third quarter of 2011 has been a rewarding and exciting time for us. We are pleased, and hope you are as well, at the progress the Company has made in the quarter and throughout the year towards improving core earnings, maintaining a strong balance sheet, and growing the Company.

We strive to keep the needs and desires of our customers at the center of what we do every day and we are committed to investing wisely in people, locations, and technology. During the third quarter, we invested in new atm tech­nology that will allow customers to enjoy the convenience of depositing cash or checks 24/7. at the same time, customers may choose to receive an instant deposit image for their records and peace of mind. the first of two deposit image atms will be available to our customers in october at the ash & macarthur location and in november at the 3601 W. Wabash location. In addition to these two machines, all of our locations will install new or upgraded atms in the very near future.

We were pleased, too, to launch a new website at www.townandcountrybank.com that is a better reflection of who we are and what we do. We hope you’ll take a few minutes to get to know better our team of bankers and how we strive to remove the fear and anxiety that is often associated with money matters. We also hope that you will recommend us to your friends and neighbors who might be seeking a bank focused on their needs.

and finally, another significant event for the Company and the communities we serve was our decision to partic­ipate in the u.S. treasury’s Small Business Lending fund (SBLf) program. under the program we issued $5 million

in preferred shares with the intent to lend up to $50 million to as many qualified businesses as possible. under the terms of the program, the Company pays a dividend to the government that is determined by the amount of qualified loans.

as we turn our focus to the company’s core earnings, we are pleased to report third­quarter net income of $708 thousand, or $0.25 per share, up 5% from the year­ago quarter. the current quarter’s results were supported by a strong net interest margin, 3.73% as compared with 3.56% in the third quarter of 2010. asset quality remained good and did not require a provision expense or impairment charge. In response to a drop in mortgage rates, we recorded a $188m after­tax charge to reflect the change in the value of servicing rights, contracts and locked mortgage commitments.

through the first nine months of 2011, net income was $2.1 million, or $0.74 per share, up 52% as compared to $1.4 million, or $0.49 per share, in the year­ago period. net revenue, excluding equity security gains and impairment charges, was up 4% to $13.3 million while non­interest expense was $10.4 million, or 1.8% higher than the year ago primarily due to expenses related to other real estate holdings. Strong asset quality and lack of charge offs resulted in no current period loan loss expense compared to $585 thousand in the prior year. Lastly, income from the gain on sale of equity securities was $121 thousand higher in the current year and no impairment charge on securities was taken in 2011 compared to a charge of $279 thousand in 2010.

We were pleased with a second, consecutive quarter of loan growth that was led again by loans to businesses. net loans were up $11.5 million from balances reported on June 30, 2011 and liquidity, as measured by the net surplus of cash and liquid securities remained strong. the tier 1 capital ratio improved to 13.1% while total risk­based capital improved to 16.7%, the increase due in large part to the Company’s participation in the SBLf that counts as tier 1 capital. equity capital increased to $37.6 million and the book value per common share was $11.67 as compared to $11.13 on December 31, 2010. the level of past due and nonperforming loans was 0.83% of total loans compared to 1.15% at December 31, 2010. the allowance for loan loss contracted a bit to 1.25% from 1.32% at year­end, reflecting strong credit quality metrics and loan growth.

the Board of Directors declared a $0.03 per share quarterly cash dividend. the dividend is payable on December 15, 2011 to stockholders of record December 1, 2011.

We believe that good financial performance is a result of staying focused on our mission and the customer, and not the other way around. We are pleased our continued financial improvements are demonstrating that belief. to be clear, the challenges facing our industry (from regulation, ill­conceived government intervention, new competitive pressures, and economic weakness) have never been greater. and yet, we remain cautiously optimistic that our unique business model will allow us to thrive.

We sincerely thank you, again, for your continued confidence and investment in town and Country financial Corporation.

Sincerely,

micah r. Bartlett David e. KirschnerPresident and CEO Executive Chairman

Micah R. Bartlett (L) and David E. Kirschner