SECURITIES AND EXCHANGE COMMISSION

                          WASHINGTON, D.C. 20549

                                                 

                                 FORM 8-K

                              CURRENT REPORT


                  PURSUANT TO SECTION 13 OR 15(d) OF THE
                      SECURITIES EXCHANGE ACT OF 1934


Date of Report (Date of earliest event reported):  October 22, 1996


                            HSBC AMERICAS, INC.
            (Exact name of registrant as specified in charter)


DELAWARE                      I-2940         22-1093160
(State or other juris-        (Commission    (IRS Employer
diction of incorporation)     File Number)   Identification No.)


ONE MARINE MIDLAND CENTER, BUFFALO, NEW YORK 14203
(Address of principal executive offices)

Registrant's telephone number, including area code:  (716) 841-2424


                              Not Applicable
                      (Former name or former address,
                         if changed since report)






                                                                        2.


Item 2.  Acquisition or Disposition of Assets

  On August 29, 1996, HSBC Americas, Inc. (the "Company") filed a Form 8-K
  reporting that on August 21, 1996, the Company and CT Financial Services
  Inc., a federal corporation organized under the laws of Canada (the 
  "Seller"), had entered into a Stock Purchase Agreement pursuant to which 
  the Company agreed to purchase from the Seller all of the issued and 
  outstanding common shares of CTUS Inc. ("CTUS"), a unitary thrift holding
  company.  CTUS owns approximately 99% of the issued and outstanding shares
  of First Federal Savings and Loan Association of Rochester ("First Federal"),
  a thrift institution which, at June 30, 1996 had approximately $7.2 billion 
  in assets and operated 80 branches across New York State, including 31 
  branches in Monroe and Erie counties.  The purchase price to be paid by 
  the Company to the Seller is $620 million in cash, subject to upwards or 
  downwards adjustment to the extent that at the time of closing of the 
  acquisition the book value of First Federal is greater than or less than 
  an amount equal to $400 million plus or minus certain adjustments.  It is 
  contemplated that simultaneously with the purchase of the common shares 
  of CTUS by the Company, First Federal will be merged with and into Marine 
  Midland Bank ("Marine"), the Company's principal subsidiary.  The Stock 
  Purchase Agreement provides that prior to the closing of the purchase of 
  the CTUS common shares by the Company, CTUS will issue to the Seller and 
  the Seller will continue to hold following the purchase, a class of 
  preferred shares of CTUS which will provide for a contingent dividend 
  or redemption equal to the amount of the recovery, net of taxes and costs,
  if any, by First Federal (or Marine as its successor) resulting from the 
  pending action in the United States Court of Claims by First Federal 
  against the United States government alleging breaches by the government 
  of contractual obligations to First Federal following passage of the 
  Financial Institutions Reform, Recovery and Enforcement Act of 1989.  The 
  Company will sell a portion of its portfolio of investment securities to 
  fund the purchase price of the CTUS common shares under the Stock 
  Purchase Agreement.

  Completion of the acquisition is subject to certain conditions, including 
  receipt of necessary regulatory approvals including approval of the Board
  of Governors of the Federal Reserve System and the New York State Banking 
  Department as well as notification of the Office of Thrift Supervision. The 
  transaction when completed will be accounted for as a purchase and the 
  results of CTUS's operations will be included in the Company's financial 
  statements from the date of acquisition. 

  On August 30, 1996 the Company filed a Form 8-K stating that it had reached
  an agreement to acquire the institutional United States dollar clearing
  activity of Morgan Guaranty Trust Company of New York.  This transaction is
  also subject to regulatory approval.  Additionally, prior to June 30, 1996
  the Company acquired two New York City branches of the Hang Seng Bank, an
  affiliate of the Company, and selected assets and liabilities of East River
  Savings Bank.  None of these acquisitions is individually significant to 
  the Company for purposes of Rule 1-02 of Regulation S-X.


Item 7.  Financial Statements and Exhibits

  a. Financial statements of CTUS Inc. are being provided in connection
     with the contemplated acquisition described in Item 2 above.  Audited
     financial statements of CTUS Inc. are included as an Exhibit to this 
     Report and unaudited interim financial information of CTUS Inc. is 
     included herein as follows:


                                                                    3.


     - Consolidated Condensed Balance Sheet of CTUS Inc. as of June 30, 
       1996 (unaudited).

     - Consolidated Condensed Income Statement of CTUS Inc. for the six
       month periods ended June 30, 1996 and June 30, 1995 (unaudited).

     - Consolidated Condensed Statement of Cash Flows of CTUS Inc. for the
       six month periods ended June 30, 1996 and June 30, 1995 (unaudited).

     - Notes to Consolidated Condensed Financial Statements of CTUS Inc.


  b. The following pro forma financial statements are provided:

     - Pro Forma Combined Condensed Balance Sheet of HSBC Americas, Inc. 
       as of June 30, 1996.

     - Pro Forma Combined Condensed Income Statement of HSBC Americas, Inc.
       for the year ended December 31, 1995.

     - Pro Forma Combined Condensed Income Statement of HSBC Americas, Inc.
       for the six months ended June 30, 1996.

     - Notes to Pro Forma Combined Condensed Financial Information of HSBC 
       Americas, Inc.  



                                                                    4.
<TABLE>
<CAPTION>
  

                             CTUS Inc.
                Consolidated Condensed Balance Sheet
                           June 30, 1996
                            (Unaudited)

                                                   (in millions)
<S>                                                   <C>
Assets
   Cash and cash equivalents                          $     197
   Securities available for sale                            614
   Securities held to maturity                              253
   Federal Home Loan Bank stock                              91
   Loans                                                  5,889
   Allowance for loan losses                                (43)
                                                        --------
      Net loans                                           5,846
   Other assets                                             220
                                                        --------
      Total assets                                    $   7,221
                                                        ========
Liabilities and Stockholder's Equity
Liabilities
   Deposits                                           $   4,390
   Securities sold under agreements to repurchase           489
   Advances from Federal Home Loan Bank                   1,780
   Senior and subordinated notes                             82
   Other borrowed funds                                       8
   Other liabilities                                        109
                                                        --------
      Total liabilities                                   6,858
                                                        --------
Stockholder's Equity
   Common stock                                               -
   Additional paid in capital                               163
   Retained earnings                                        205
   Unrealized loss on securities available 
    for sale, net of taxes                                   (5)
                                                        --------
      Total stockholder's equity                            363
                                                        --------
      Total liabilities and stockholder's equity      $   7,221
                                                        ========


See accompanying notes to consolidated condensed financial statements.

</TABLE>




                                                                  5.

<TABLE>
<CAPTION>

                         CTUS Inc.
          Consolidated Condensed Income Statement
                       (Unaudited)

                                             Six months ended
                                                  June 30,
                                            1996           1995
                                               (in millions)
<S>                                        <C>            <C>
Interest income                            $ 252          $ 232
Interest expense                             165            150
                                            ----           ----  
Net interest income before
 provision for loan losses                    87             82
Provision for loan loss                        9              8
                                            ----           ----
Net interest income after provision           78             74
                                            ----           ----
Other operating income
   Loan fees                                   3              2
   Loan servicing income, net                  6              5
   Customer service fees                       5              4
   Net gain on sale of 
    mortgage loans and securities              4              -  
   Other                                       6              8
                                            ----           ----  
                                              24             19
                                            ----           ----
                                             102             93
                                            ----           ----
Operating expenses
   Employee compensation and benefits         29             29
   Office, occupancy and equipment            10             10
   General and administrative                 19             16
   Deposit insurance premiums                  5              5
                                            ----           ----
                                              63             60
                                            ----           ----
Income before taxes                           39             33
Income tax expense (benefit)                 (19)            14
                                            ----           ----
Net income                                 $  58          $  19
                                            ====           ====


See accompanying notes to consolidated condensed financial statements.

</TABLE>


                                                                     6.
<TABLE>
<CAPTION>

                          CTUS Inc.
         Consolidated Condensed Statement of Cash Flows
                         (Unaudited)

                                                   Six months ended
                                                       June 30,
                                                 --------------------
                                                 1996           1995
                                                 -----          -----
                                                     (in millions)
<S>                                             <C>            <C>
Cash flows from operating activities:
   Net income                                   $  58          $  19
   Adjustments to reconcile net income
    to net cash provided (used) by 
    operating activities
      Non-cash income/expenses                     (6)            13
      Net change in:
         Other assets                              (4)            (5)
         Other liabilities                        (49)           (17)
                                                 -----          -----
   Net cash provided (used) by 
    operating activities                           (1)            10
                                                 -----          -----

Cash flows from investing activities:
   Net change in investments                       58             94
   Net change in loans                           (112)          (378)
   Other, net                                     (15)           (10)
                                                 -----          -----
   Net cash used by investing activities          (69)          (294)
                                                 -----          -----

Cash flows from financing activities:
   Net change in deposits                          54            153
   Net change in advances
    from Federal Home Loan Bank                    68             (8)
   Net change in borrowed funds                   (82)            97
                                                 -----          -----
   Net cash provided by financing activities       40            242
                                                 -----          -----

Net decrease in cash and cash equivalents         (30)           (42)
Cash and cash equivalents at beginning 
 of period                                        227            216
                                                 -----          -----
Cash and cash equivalents at end of period      $ 197          $ 174
                                                 =====          =====



See accompanying notes to consolidated condensed financial statements.

</TABLE>


                                                                       7.


                                   CTUS Inc.

              Notes to Consolidated Condensed Financial Statements


1.   Basis of Presentation

  The accounting and reporting policies of CTUS Inc. (the Company) conform
  to generally accepted accounting principles.  Such policies, except as
  noted below, are consistent with those applied in the presentation of the
  Company's annual financial statements which are contained in the exhibits.

  The interim financial information in this report has not been audited.  In
  the opinion of the Company's management, all adjustments necessary for a
  fair presentation of financial position, results of operations and cash
  flows for the interim periods have been made.  The interim financial
  information should be read in conjunction with the Consolidated Financial
  Statements for the years ended December 31, 1995 and 1994.

2.   New Accounting Standards

  Effective January 1, 1996, the Company adopted the provisions of Statement
  of Financial Accounting Standards No. 122, Accounting for Mortgage
  Servicing Rights (FAS 122) prospectively.  FAS 122 requires that a
  mortgage banking enterprise recognize as separate assets, the right to
  service mortgage loans for others, whether acquired directly or in
  conjunction with the acquisition of mortgage loan assets.

  As originated or purchased mortgage loans are sold, securitized or where a
  definitive plan exists to sell or securitize such loans, their total cost
  is allocated between servicing rights and the loans, based on relative
  fair values.

  FAS 122 specifies that servicing rights be evaluated for impairment based
  on the difference between the carrying value of such rights and their
  current fair value.  For purposes of measuring impairment, which is to be
  recorded through use of a valuation reserve, servicing rights will be
  stratified based upon interest rates and whether or not such rates are
  fixed or variable.

  The adoption of FAS 122 did not have a material effect on the financial
  position or results of operations of the Company.

  The Company is required to adopt Statement of Financial Accounting
  Standards No. 125, Accounting for Transfers and Servicing of Financial
  Assets and Extinguishments of Liabilities (FAS 125), effective January 1,
  1997.  The Company does not expect that the adoption of FAS 125 will have
  a material effect on its financial position or results of operation.





                                                                         8.



                            HSBC Americas, Inc.

      UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL INFORMATION


On August 21, 1996 the Company entered into an agreement to purchase CTUS
Inc., a unitary thrift holding company.  CTUS Inc. owns approximately 99% of
the issued and outstanding shares of First Federal Savings and Loan
Association of Rochester.  The acquisition will be accounted for under the
purchase method of accounting.  The transaction is subject to regulatory
approval and is expected to close no later than the first quarter of 1997.  
In addition to the proposed acquisition of CTUS Inc.: (i) on May 20, 1996 the
Company consummated the acquisition of two New York City branches of Hang Seng
Bank, an affiliate of the Company, (ii) on June 28, 1996 the Company 
consummated the acquisition of selected assets and liabilities of East River
Savings Bank (the "Consummated Transactions") and (iii) on August 13, 1996 the
Company agreed to acquire the United States dollar clearing activities of 
Morgan Guaranty Trust Company of New York (the "Dollar Clearing Activities 
Transaction").  The Dollar Clearing Activities Transaction is subject to 
regulatory approval and is expected to close in the fourth quarter of 1996.  
Neither the Consummated Transactions nor the Dollar Clearing Activities 
Transactions are considered to be acquisitions of businesses.  Reliable 
historical financial information concerning results of operations for these 
nonbusiness transactions are not available and therefore are not included 
in the pro forma combined condensed income statements.  However, results of 
the Consummated Transactions are included in the Company's historical income 
statement for the six months ended June 30, 1996 from their respective dates 
of acquisition.  Apart from the CTUS Inc. acquisition, none of these 
acquisitions is individually significant to the Company for purposes of Rule 
1-02 of Regulation S-X.  The following provides the basis of presentation of 
all of the acquisitions in the Company's pro forma combined condensed 
financial information.

The pro forma combined condensed balance sheet as of June 30, 1996 includes
the CTUS Inc. transaction and the Dollar Clearing Activities Transaction
because the consummation of such transactions is considered to be probable.
Information with respect to the Dollar Clearing Activities Transaction is as
of December 31, 1995 as more recent information is not available.  The 
Consummated Transactions are included in the historical balance sheet of the
Company as of June 30, 1996.  The assets and liabilities relating to such
acquisitions were recorded at their respective fair values at the dates such
acquisitions were consummated.

The accompanying pro forma combined condensed income statement for the year
ended December 31, 1995 and for the six months ended June 30, 1996 present
the pro forma impact of the acquisition of CTUS Inc. assuming that the
acquisition had been completed as of the beginning of each period presented.

The pro forma information is based on the historical financial statements
after giving effect to the impact of the purchase accounting adjustments
relating to the acquisitions.  Assumptions and adjustments are set forth in
the accompanying notes made in connection with the preparation of the pro
forma combined condensed financial information.  Purchase accounting
adjustments to reflect estimated fair values have been made with respect to
the assets and liabilities acquired based upon preliminary estimates and 
evaluations as of June 30, 1996.  The allocations of the purchase prices are
subject to final determination, based upon estimates and other evaluations
of fair value, as of the date the acquisitions are consummated.  Therefore,
the allocations reflected in the following pro forma combined condensed 
financial information may differ from the amounts ultimately determined.



                                                                  9.

The pro forma information with respect to CTUS Inc. has been prepared by
the Company's management based upon the financial statements of CTUS Inc.
included elsewhere herein and information obtained by the Company during
its investigation of the activities acquired.  The pro forma financial
information should be read in conjunction with the notes thereto.  This
pro forma information may not be indicative of the results that actually
would have occurred if the purchase had been consummated on the dates
indicated or which may be obtained in the future.  While the Company expects
to achieve certain operating cost savings as a result of the combination,
no adjustment has been included in the pro forma amounts for anticipated
operating cost savings.


                                                                    10.

<TABLE>
<CAPTION>

                                   HSBC Americas, Inc.
                       Pro Forma Combined Condensed Balance Sheet
                                     June 30, 1996
                                     (Unaudited)
                                    (in millions)   

                                         Historical
                                   ----------------------
                                       HSBC
                                     Americas,    CTUS       Other     Pro Forma     Pro Forma
                                       Inc.       Inc.    Acquisition  Adjustments    Combined 
                                     ---------   -------  -----------  ----------    --------
<S>                                <C>        <C>         <C>           <C>          <C>
Assets
   Cash and due from banks         $    2,316 $      197  $       220   $   (45)(2)  $  2,688
   Federal funds sold and 
    securities purchased under
    agreements to resell                  977                   1,130                   2,107
   Trading assets                         871                                             871

                                                                             (4)(6)
                                                                           (660)(4)
   Securities                           3,341        958                   (227)(5)     3,408
   Loans                               14,760      5,889          450        40 (6)    21,139
   Less: allowance for loan loss          458         43                                  501
                                     ---------   -------    ---------   -------       -------  
      Loans, net                       14,302      5,846          450        40        20,638
                                     ---------   -------    ---------   -------       -------   
   Other assets                           794        220                     (4)(6)     1,010
                                                                            276 (4)     
   Goodwill                               126                                12 (6)       414
                                     ---------   -------    ---------   -------       -------
      Total assets                 $   22,727 $    7,221  $     1,800  $   (612)     $ 31,136
                                     =========   ========   =========   =======       =======

Liabilities and Shareholders' Equity
Liabilities
   Deposits - domestic offices     $   14,864 $    4,390  $     1,800  $      6 (6)  $ 21,060
            - foreign offices           2,400                                           2,400
   Federal funds purchased and
    securities sold under
    repurchase agreements               1,184        489                                1,673

                                                                            (82)(1) 
                                                                              2 (6) 
   Other borrowed funds                 2,121      1,870                   (227)(5)     3,684
   Interest, taxes and                                                       16 (3)
    other liabilities                     319        109                     36 (6)       480
                                     ---------   -------     ---------   ------      --------
    Total liabilities                  20,888      6,858         1,800     (249)       29,297
                                     ---------   -------     ---------   ------      -------- 
                                                                           (384)(4) 
                                                                             82 (1) 
                                                                            (45)(2)   
Shareholders' Equity                    1,839        363                    (16)(3)     1,839
                                     ---------   -------     ---------   ------      --------     
      Total liabilities and
       shareholders' equity        $   22,727 $    7,221   $     1,800  $   (612)    $ 31,136
                                     =========   ========    =========   =======    =========


See Notes to Pro Forma Combined Condensed Financial Information.

(1) Conversion to equity of CTUS Inc. debt of $82 million payable to former 
    parent.
(2) Payment of dividend of $45 million by CTUS Inc. to former parent.
(3) As discussed in footnote 17 to the 1995 consolidated financial 
    statements of CTUS Inc. attached as an Exhibit to this Report, CTUS Inc.
    is subject to the one-time assessment to recapitalize the SAIF Insurance
    Fund.  Legislation signed into law on September 30, 1996 resulted in an 
    after tax expense of $16 million being accrued by CTUS Inc. at 
    September 30, 1996 which is one of the downward adjustments to the net
    book value of CTUS Inc. at the time of closing.
(4) Assuming liquidation of investment portfolio to fund acquisitions, 
    including the related goodwill.
(5) Immediate liquidation of $227 million of CTUS Inc. securities portfolio
    upon acquisition and repayment of same amount of advances from the Federal
    Home Loan Bank of New York.
(6) Estimated purchase accounting adjustments to reflect fair value and 
    related acquisition liabilities.


</TABLE>


                                                                        11.

<TABLE>
<CAPTION>

                                HSBC Americas, Inc.
                  Pro Forma Combined Condensed Income Statement
                           Year ended December 31, 1995
                                   (Unaudited)
                                  (in millions)


                            Historical
                         ---------------
                                                                  HSBC
                              HSBC                           Americas,
                         Americas,    CTUS   Pro Forma        Inc. and
                              Inc.    Inc.     Adjust.       CTUS Inc.
                         ---------    ----   ---------       --------- 
<S>                         <C>       <C>       <C>    <C>      <C>         
                            $         $         $ (38) (2)      $
                                                   (2) (1)
Interest income              1,488     481        (13) (3)       1,916 
                                                   (7) (1) 
Interest expense               596     315          3  (3)         907
                             -----     ---       ----            -----
Net interest income            892     166        (49)           1,009
                                                        
Provision for loan loss        175      15          -              190    
                             -----     ---       ----            -----
Net interest income
 after provision for
 loan loss                     717     151        (49)             819
Other Operating income         315      43         (6) (3)         352
                             -----     ---       ----            -----
                             1,032     194        (55)           1,171
Operating expenses             696     123         17  (3)         836
                             -----     ---       ----            -----

Income before taxes            336      71        (72)             335
Income taxes                    52      29        (24) (4)          57
                             -----     ---       ----            -----
Net income                  $  284    $ 42      $ (48)          $  278
                             =====     ===       ====            =====


See Notes to Pro Forma Combined Condensed Financial Information.
(1)  Reduction of interest expense associated with $82 million debt conversion 
     to equity and interest income associated with $45 million dividend.
(2)  Reduction of interest income on securities liquidated.
(3)  Impact of pro forma purchase accounting adjustments.
(4)  Income taxes related to applicable adjustments at 43%.

</TABLE>

                                                                       12.
<TABLE>
<CAPTION>

                           HSBC Americas, Inc.

               Pro Forma Combined Condensed Income Statement
                      Six months ended June 30, 1996
                               (Unaudited)
                              (in millions)


                              Historical
                          -------------------
                                                                       HSBC
                               HSBC                               Americas,
                          Americas,      CTUS     Pro Forma        Inc. and
                               Inc.      Inc.       Adjust.       CTUS Inc.
                          ---------      ----     ---------       ---------
<S>                            <C>       <C>          <C>   <C>      <C>
                               $         $            $(19) (2)      $
                                                        (1) (1)
Interest income                 777       252           (6) (3)       1,003
                                                        (3) (1)
Interest expense                320       165            1  (3)         483
                                ---       ---          ---            -----
Net interest income             457        87          (24)             520
Provision for loan loss          35         9            -               44
                                ---       ---          ---            -----
Net interest income after
 provision for loan loss        422        78          (24)             476
Other operating income          154        24           (3) (3)         175
                                ---       ---          ---            -----
                                576       102          (27)             651
Operating expenses              313        63            9  (3)         385
                                ---       ---          ---            -----
Income before taxes             263        39          (36)             266
Income taxes                     88        16 (5)      (12) (4)          92
                                ---       ---          ---            -----
Net income                     $175      $ 23         $(24)          $  174
                                ===       ===          ===            =====


See Notes to Pro Forma Combined Condensed Financial Information.
(1) Reduction of interest expense associated with $82 million debt conversion
    to equity and interest income associated with $45 million dividend.
(2) Reduction of interest income on securities liquidated.
(3) Impact of pro forma purchase accounting adjustments.
(4) Income taxes related to applicable adjustments at 43%.
(5) Excludes $35 million tax recovery relating to settlement of a net 
    operating loss issue.

</TABLE>


                                                                        13.


                            HSBC Americas, Inc.
        Notes to Pro Forma Combined Condensed Financial Information
                                (Unaudited)


NOTE 1.  Under the purchase agreement relating to the CTUS Inc. acquisition,
immediately prior to consummation of the acquisition of all of the common 
stock of CTUS Inc. by the Company CTUS Inc. will convert senior debt owed to 
its parent to equity and declare and pay a dividend to its parent, in an 
amount to reduce shareholder's equity  immediately prior to the acquisition 
to $400 million plus or minus certain adjustments.  The Company will sell a
portion of its portfolio of investment securities to fund the purchase price
of the CTUS Inc. common shares.

The purchase agreement also provides that prior to the closing of the 
purchase of the CTUS Inc. common shares by the Company, CTUS Inc. will issue
to its former parent and the former parent will continue to hold following 
the purchase, a class of preferred shares of CTUS Inc. which will provide 
for a contingent dividend or redemption equal to the amount of recovery, 
net of taxes and costs if any, by First Federal (or Marine as its successor)
resulting from the pending action against the United States government 
alleging breaches by the government of contractual obligations to First 
Federal following the passage of the Financial Institutions Reform, Recovery
and Enforcement Act of 1989.

NOTE 2.  The assumptions underlying the pro forma purchase accounting
adjustments are summarized as follows:

(a)  The estimated fair value adjustments have been determined by the Company
     based upon information provided by CTUS Inc. and (in the case of the 
     balance sheet adjustments) Morgan Guaranty Trust Company of New York,
     additional information obtained in the preliminary review of the 
     operations of the sellers and various assumptions deemed appropriate 
     by the Company.  The fair values ultimately determined may be different
     from those values used in the pro forma adjustments included herein.

      (i)  Securities were valued at their estimated fair market value as
           of June 30, 1996 less those anticipated to be immediately sold.

     (ii)  Loans were valued based upon interest rates as of June 30, 1996. 
           The resulting net premium is being amortized against income over
           the remaining estimated life of the portfolio utilizing certain
           prepayment assumptions so as to produce a constant yield to
           maturity.

    (iii)  Premises and equipment included in other assets were recorded at
           their estimated fair value.  

     (iv)  Mortgage servicing rights, included in other assets, represent
           acquired servicing rights and were valued at fair value.  The
           resulting premium is being amortized against income over the
           remaining life of the servicing portfolio utilizing certain
           prepayment assumptions.

      (v)  Deposits were valued based upon interest rates for comparable
           deposit liabilities as of June 30, 1996.  The resulting premiums
           are being amortized into interest expense over the remaining
           contractual term so as to produce a constant return to maturity.
                                                               


                                                                    14.


     (vi)  Other borrowed funds were valued based upon interest rates for
           comparable borrowed funds as of June 30, 1996.  Outstandings
           were reduced by amounts received in liquidation of securities.

    (vii)  Upon acquisition it is more likely than not that all tax
           benefits of CTUS Inc. will be realized in some future period by
           the combined entity.  Therefore, the valuation adjustment of
           CTUS Inc. will be brought to zero.

    (viii) Employee benefit liabilities related to employee contracts and
           severance costs related to the elimination of redundant
           personnel costs were recorded.

     (ix)  Liabilities for lease buyouts of facilities to be vacated were
           provided.

      (x)  Excess of the cost of net assets acquired over their fair
           value is being amortized into expense on a straight line basis
           over periods of 10 to 15 years.

<TABLE>
<CAPTION>

(b) The purchase price is estimated to be allocated as described in the 
    table below:

                                 (in millions)
   <S>                                  <C>
   Cost of acquisitions                 $ 660
                                         ---- 
   Net assets acquired                    384 
   Fair value adjustments:
     Securities                            (4)     
     Loans                                 40 
     Other assets
       Mortgage servicing rights           20 
       Premises and equipment             (16)
       Write off of 
        intangible assets                  (8)
     Deposits                              (6)
     Borrowed funds                        (2)
     Reduction in deferred tax
      valuation allowance                  10      
   Other liabilities                          
     Lease termination costs               (4)
     Employee benefits                    (25)
     Acquisition costs                     (6)
     Other costs                           (3)
     Deferred tax liability                (8)
                                          ---    
                                          372 
                                          ---
   Excess of cost of net assets
    acquired over fair value
    (goodwill)                           $288 
                                          ===

    
</TABLE>


NOTE 3.  The Pro Forma Combined Condensed Income Statements for the year 
ended December 31, 1995 and the six months ended June 30, 1996 reflect the
combination of historical operating results of the Company and CTUS Inc. and
include the necessary purchase accounting adjustments as if the combination
had taken place at the beginning of each of the periods presented.  Historical
results of operations relating to the Consummated Transactions and the Dollar
Clearing Activities Transaction are not included as reliable historical
results of operations are not available.  However, results of the Consummated
Transactions are included in the Company's historical income statement for 
the six months ended June 30, 1996 from their respective dates of acquisition.



                                                                       15.


The purchase accounting adjustments used in the preparation of the Pro Forma
Combined Condensed Income Statements are summarized below:


<TABLE>
<CAPTION>

                                                       Six Months
                                    Year Ended              Ended
                             December 31, 1995      June 30, 1996

                                            (in millions)                    
<S>                                       <C>                <C>
Net income of the Company                 $284               $175
Net income of CTUS Inc.                     42                 23
Pro forma adjustments
  Amortization/accretion of
   purchase accounting adjustments:
     Loans                                (13)                 (6)
     Mortgage servicing rights             (6)                 (3)
     Deposits                              (3)                 (1)
     Excess of cost of net assets
      acquired over fair value            (17)                 (9)
  Loss of interest income on
   investments due to assumed use
   of such investments to fund
   the purchase price                     (38)                (19)
  Reduction in interest expense
   associated with debt conversion
   net of dividend                          5                   2 
  Net tax effect associated 
   with above adjustments excluding 
   amortization of excess of cost
   of net assets acquired over
   fair value                              24                  12 

Pro forma net income                     $278                $174 

</TABLE>

<TABLE>
<CAPTION>

NOTE 4.  The following table sets forth the projected effect of purchase
accounting adjustments relating to the CTUS Inc. acquisition, the Consummated
Transactions and the Dollar Clearing Activities Transaction,  on the 
operating results of future periods.  The annual amortization of the excess 
cost of net assets acquired over fair value of $17 million relating to CTUS 
Inc. is not subject to deduction for Federal and state taxes.  The projected
amortization and accretion is subject to change in the event of changes in
fair value on consummation date, if such assets are subsequently sold and to
variations between future prepayments assumed in the preparation of the table
and those which may actually occur.

                            1997    1998   1999    2000   2001
<S>                          <C>     <C>    <C>     <C>    <C>
Amortization of:
  Premium on loans           $13     $11    $ 8     $ 5    $ 3
  Purchased mortgage 
   servicing rights            6       5      4       3      2
  Discount on deposits         3       3      -       -      -
  Excess cost of net
   assets acquired 
    over fair value           28      28     28      28     28
  Charge to operations       $50     $47    $40     $36    $33

    

                                                                     16.


NOTE 5.  The Consummated Transactions and Dollar Clearing Activities 
Transaction are anticipated to provide $100 million in operating revenues,
offset in part by approximately $60 million in operating expenses excluding
income taxes during the first full year of combined operations.




                                                                      17.


(c)  Exhibits

      2.  Stock Purchase Agreement between CT Financial Services Inc. and
          HSBC Americas, Inc. dated as of August 21, 1996.
     
     13.  Audited consolidated financial statements for CTUS Inc. - 
          December 31, 1995 and 1994, including independent auditors' report
          thereon.
     
     23.  Independent Auditors' Consent




                                                                     18.



                                SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.



                              HSBC AMERICAS, INC.

                                                                
                              (REGISTRANT)

                              /s/ Gerald A. Ronning
                                                                
                              NAME:   GERALD A. RONNING
                              TITLE:  EXECUTIVE VICE PRESIDENT &
                                      CONTROLLER
                                                                                


Date:  October 22, 1996






                                                   Exhibit 2

                                                                           
ATTORNEY WORK PRODUCT
PRIVILEGED AND CONFIDENTIAL




                                                                     


                                                           
                                    
                        STOCK PURCHASE AGREEMENT
                                                           
                                    
                                    
                                 between
                                    
                                    
                       CT FINANCIAL SERVICES INC.
                               ("Seller")
                                    
                                   and
                                    
                                    
                           HSBC AMERICAS, INC.
                              ("Purchaser")
                                    
                                    
                       dated as of August 21, 1996




                                                                          
                             TABLE OF CONTENTS

                                                                       Page

                                 ARTICLE I

                                DEFINITIONS

     SECTION 1.01.  Certain Defined Terms. . . . . . . . . . . . . . . .  1
     SECTION 1.02.  Additional Defined Terms . . . . . . . . . . . . . .  6

                                ARTICLE II

                             PURCHASE AND SALE

     SECTION 2.01.  Purchase and Sale. . . . . . . . . . . . . . . . . .  8
     SECTION 2.02.  Purchase Price . . . . . . . . . . . . . . . . . . .  8
     SECTION 2.03.  Closing. . . . . . . . . . . . . . . . . . . . . . .  8
     SECTION 2.04.  Purchase Price Adjustment. . . . . . . . . . . . . .  8
     SECTION 2.05.  Certain Accounting Matters . . . . . . . . . . . . . 11

                                ARTICLE III

               REPRESENTATIONS AND WARRANTIES OF THE SELLER

     SECTION 3.01.  Organization and Authority of the Seller . . . . . . 12
     SECTION 3.02.  CTUS Representation. . . . . . . . . . . . . . . . . 12
     SECTION 3.03.  Organization and Qualification of CTUS, the Company
                              and the Subsidiaries . . . . . . . . . . . 12
     SECTION 3.04.  Capital Stock of CTUS. . . . . . . . . . . . . . . . 13
     SECTION 3.05.  Capital Stock of the Company and the Subsidiaries. . 13
     SECTION 3.06.  Consents and Approvals . . . . . . . . . . . . . . . 14
     SECTION 3.07.  No Conflict. . . . . . . . . . . . . . . . . . . . . 15
     SECTION 3.08.  CTUS Financial Statements. . . . . . . . . . . . . . 15
     SECTION 3.09.  Company Financial Statements . . . . . . . . . . . . 16
     SECTION 3.10.  Absence of Certain Changes or Events . . . . . . . . 16
     SECTION 3.11.  Absence of Litigation. . . . . . . . . . . . . . . . 18
     SECTION 3.12.  Compliance with Laws . . . . . . . . . . . . . . . . 18
     SECTION 3.13.  Contracts. . . . . . . . . . . . . . . . . . . . . . 18
     SECTION 3.14.  Reports. . . . . . . . . . . . . . . . . . . . . . . 19
     SECTION 3.15.  Taxes. . . . . . . . . . . . . . . . . . . . . . . . 19
     SECTION 3.16.  Real Property. . . . . . . . . . . . . . . . . . . . 20
     SECTION 3.17.  Environmental Matters. . . . . . . . . . . . . . . . 21
     SECTION 3.18.  Employee Benefit Matters . . . . . . . . . . . . . . 21
     SECTION 3.19.  Labor Matters. . . . . . . . . . . . . . . . . . . . 25
     SECTION 3.20.  Insurance. . . . . . . . . . . . . . . . . . . . . . 25
     SECTION 3.21.  Minority Shares. . . . . . . . . . . . . . . . . . . 25
     SECTION 3.22.  Intercompany Obligations . . . . . . . . . . . . . . 25
     SECTION 3.23.  Community Reinvestment Act . . . . . . . . . . . . . 26
     SECTION 3.24.  Brokers. . . . . . . . . . . . . . . . . . . . . . . 26

                                ARTICLE IV

              REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

     SECTION 4.01.  Organization and Authority of the Purchaser. . . . . 26
     SECTION 4.02.  Organization of Marine Midland Bank. . . . . . . . . 26
     SECTION 4.03.  Consents and Approvals . . . . . . . . . . . . . . . 27
     SECTION 4.04.  No Conflict. . . . . . . . . . . . . . . . . . . . . 27
     SECTION 4.05.  Compliance with Laws . . . . . . . . . . . . . . . . 27
     SECTION 4.06.  Absence of Litigation. . . . . . . . . . . . . . . . 28
     SECTION 4.07.  Securities Law . . . . . . . . . . . . . . . . . . . 28
     SECTION 4.08.  Financing. . . . . . . . . . . . . . . . . . . . . . 28
     SECTION 4.09.  Community Reinvestment Act . . . . . . . . . . . . . 28
     SECTION 4.10.  Brokers. . . . . . . . . . . . . . . . . . . . . . . 28

                                 ARTICLE V

                           ADDITIONAL AGREEMENTS

     SECTION 5.01.  Conduct of Business Prior to the Closing . . . . . . 29
     SECTION 5.02.  Investigation. . . . . . . . . . . . . . . . . . . . 30
     SECTION 5.03.  Access to Information. . . . . . . . . . . . . . . . 31
     SECTION 5.04.  Books and Records. . . . . . . . . . . . . . . . . . 32
     SECTION 5.05.  Confidentiality. . . . . . . . . . . . . . . . . . . 32
     SECTION 5.06.  Authorizations; Consents and Notices . . . . . . . . 33
     SECTION 5.07.  Pre-Closing Payments . . . . . . . . . . . . . . . . 33
     SECTION 5.08.  Notice of Events . . . . . . . . . . . . . . . . . . 34
     SECTION 5.09.  FIRREA Claim . . . . . . . . . . . . . . . . . . . . 34
     SECTION 5.10.  No Solicitation. . . . . . . . . . . . . . . . . . . 36
     SECTION 5.11.  Covenant Not to Compete. . . . . . . . . . . . . . . 37
     SECTION 5.12.  Environmental Audit. . . . . . . . . . . . . . . . . 38
     SECTION 5.13.  Minority Shares. . . . . . . . . . . . . . . . . . . 38
     SECTION 5.14.  Merger Structure . . . . . . . . . . . . . . . . . . 38
     SECTION 5.15.  FIRTPA Certificate . . . . . . . . . . . . . . . . . 39
     SECTION 5.16.  Further Assurances . . . . . . . . . . . . . . . . . 39
     SECTION 5.17.  Transition . . . . . . . . . . . . . . . . . . . . . 40

                                ARTICLE VI

                             EMPLOYEE MATTERS

     SECTION 6.01.  Provision of Comparable Benefits . . . . . . . . . . 40
     SECTION 6.02.  Succession . . . . . . . . . . . . . . . . . . . . . 41
     SECTION 6.03.  Survival . . . . . . . . . . . . . . . . . . . . . . 41

                                ARTICLE VII

                                TAX MATTERS

     SECTION 7.01.  Tax Indemnities. . . . . . . . . . . . . . . . . . . 41
     SECTION 7.02.  Refunds and Tax Benefits . . . . . . . . . . . . . . 43
     SECTION 7.03.  Contests . . . . . . . . . . . . . . . . . . . . . . 44
     SECTION 7.04.  Preparation of Tax Returns . . . . . . . . . . . . . 47
     SECTION 7.05.  Cooperation and Exchange of Information. . . . . . . 47
     SECTION 7.06.  Conveyance Taxes . . . . . . . . . . . . . . . . . . 48
     SECTION 7.07.  Miscellaneous. . . . . . . . . . . . . . . . . . . . 48

                               ARTICLE VIII

                           CONDITIONS TO CLOSING

     SECTION 8.01.  Conditions to Obligations of the Seller. . . . . . . 48
     SECTION 8.02.  Conditions to Obligations of the Purchaser . . . . . 49

                                ARTICLE IX

                     TERMINATION, AMENDMENT AND WAIVER

     SECTION 9.01.  Termination. . . . . . . . . . . . . . . . . . . . . 50
     SECTION 9.02.  Effect of Termination. . . . . . . . . . . . . . . . 50
     SECTION 9.03.  Waiver . . . . . . . . . . . . . . . . . . . . . . . 51
     SECTION 9.04.  Termination Fee. . . . . . . . . . . . . . . . . . . 51

                                 ARTICLE X

                            GENERAL PROVISIONS

     SECTION 10.01. Non-Survival of Representations, Warranties, Covenants
                              and Agreements . . . . . . . . . . . . . . 51
     SECTION 10.02. Release and Indemnification. . . . . . . . . . . . . 52
     SECTION 10.03. Indemnification by the Seller. . . . . . . . . . . . 52
     SECTION 10.04. Prior Tax Sharing Agreements . . . . . . . . . . . . 56
     SECTION 10.05. Expenses . . . . . . . . . . . . . . . . . . . . . . 56
     SECTION 10.06. Federal Home Loan Bank of New York Advances. . . . . 57
     SECTION 10.07. Notices. . . . . . . . . . . . . . . . . . . . . . . 57
     SECTION 10.08. Public Announcements . . . . . . . . . . . . . . . . 58
     SECTION 10.09. Headings . . . . . . . . . . . . . . . . . . . . . . 58
     SECTION 10.10. Severability . . . . . . . . . . . . . . . . . . . . 58
     SECTION 10.11. Disclosure Schedule. . . . . . . . . . . . . . . . . 58
     SECTION 10.12. Entire Agreement . . . . . . . . . . . . . . . . . . 59
     SECTION 10.13. Assignment . . . . . . . . . . . . . . . . . . . . . 59
     SECTION 10.14. No Third-Party Beneficiaries . . . . . . . . . . . . 59
     SECTION 10.15. Amendment; Waiver. . . . . . . . . . . . . . . . . . 59
     SECTION 10.16. Governing Law. . . . . . . . . . . . . . . . . . . . 59
     SECTION 10.17. Counterparts . . . . . . . . . . . . . . . . . . . . 59


EXHIBITS

     Exhibit 2.05(b)          Sample Calculation of the Audited Book Value 
                              of the Company
     Exhibit 3.08             CTUS Financial Statements
     Exhibit 3.09             Company Financial Statements
     Exhibit 5.09(b)          Term Sheet for Preferred Stock
     Exhibit 5.09(e)          Standard of Conduct for FIRREA Plaintiff
     Exhibit 5.14(c)          Proposed Form of Bank Plan of Merger


          STOCK PURCHASE AGREEMENT dated as of August 21, 1996 between
CT FINANCIAL SERVICES INC., a federal corporation organized under the Laws of
Canada (the "Seller"), and HSBC AMERICAS, INC., a Delaware corporation (the
"Purchaser").


                           W I T N E S S E T H :

          WHEREAS, the Seller owns, directly or indirectly, all of the issued 
and outstanding common shares (the "CTUS Shares") of CTUS Inc., a Delaware 
corporation ("CTUS");

          WHEREAS, on the date hereof, CTUS owns approximately 99% of the
issued and outstanding shares (the "Company Shares") of First Federal Savings 
and Loan Association of Rochester (the "Company"); and

          WHEREAS, the Seller wishes to sell to the Purchaser, and the 
Purchaser wishes to purchase from the Seller, the CTUS Shares on the terms and 
conditions set forth herein and wishes to obtain the indirect ownership of all 
of the issued and outstanding shares of the Company;

          NOW, THEREFORE, in consideration of the premises and of the mutual
agreements and covenants hereinafter set forth, the Seller and the Purchaser 
hereby agree as follows:

          
                                 ARTICLE I

                                DEFINITIONS

          SECTION 1.01.  Certain Defined Terms.  As used in this Agreement, the
following terms shall have the following meanings:

          "Affiliate" of a specified person means a person that directly or 
indirectly, through one or more intermediaries, controls, is controlled by, or 
is under common control with, such specified person.

          "Agreed Minimum Audit Date Book Value" means an amount equal to
(a) the sum of (i) U.S.$400,000,000 and (ii) an amount equal to the excess, if 
any, of the Covered Period Net Earnings over the Earnings Amount less (b) the 
sum of (i) the Employee Amount and (ii) the BIF/SAIF Amount plus (c) the 
amount, if any, by which the Employee Amount exceeds U.S. $16,000,000.

          "Agreement" means this Stock Purchase Agreement dated as of August 21,
1996 (including the exhibits and schedules hereto) and all amendments hereto 
made in accordance with the provisions of Section 10.15.

          "BIF/SAIF Amount" means an amount equal to any special one-time
assessment or charge (net of any Tax benefit) paid or accrued by the Company 
prior to the Closing arising out of or related to any Law with respect to 
insurance of deposits (as defined in the FDIA) of the Company by or through 
the Savings Association Insurance Fund (SAIF), but not any regular premium 
paid or accrued prior to the Closing Date, less the present value at the 
Closing Date of the difference between (a) the premiums paid or accrued in 
respect of the Company's deposits from the date such one-time assessment or 
charge was paid or accrued through the Closing Date and (b) the premiums 
that would have been paid or accrued had no such assessment or charge been
paid or accrued.

          "Book Value" means the amount by which total consolidated assets 
exceeds total consolidated liabilities of an entity as shown on any specified 
consolidated balance sheet prepared in accordance with GAAP.

          "Business" means the business of providing financial services and 
related financial products and all other business which is currently being 
conducted by the indicated person or entity.

          "Business Day" means a day of the year on which banks are not 
required or authorized to be closed in New York or Toronto.

          "Chemical Substance" means any pollutant, chemical, mixture, 
petroleum or any fraction thereof, asbestos or asbestos-containing material, 
polychlorinated biphenyls, or any substances, materials or wastes which are 
regulated under any Environmental Law.

          "Code" means the Internal Revenue Code of 1986, as amended through 
the date hereof.

          "Covered Period Net Earnings" means the net earnings of the 
Company excluding the BIF/SAIF Amount and the Employee Amount from July 1, 
1996 through the Audit Date as determined by the Company's Accountants in 
accordance with Section 2.04.

          "Deferred Tax Valuation Amount" means a maximum amount equal to
U.S.$5,000,000 representing a portion of the aggregate valuation allowances 
provided against deferred tax assets of the Company.

          "Earnings Amount" means the sum of (i) U.S.$5,300,000 multiplied 
by the number of months between July 1, 1996 and the Audit Date and 
(ii) U.S.$5,000,000.

          "Employee Amount" means an amount (net of Tax benefit) equal to 
the aggregate amount of all severance payments, benefits, bonus amounts 
relating to all options, completion or stay bonuses, special and long-term 
incentives paid or payable to employees or former employees of the Company 
or other employment-related consideration but only to the extent the same 
arises out of or results from the transactions contemplated by this 
Agreement and any amounts in respect of the foregoing whether or not paid 
or accrued by the Company before the Audit Date.

          "Encumbrance" means a pledge, lien, security interest, mortgage, 
charge, adverse claim of ownership or use, or other encumbrance of any kind.

          "Environment" means any soil, surface waters, groundwaters, stream
sediments, surface or subsurface strata, and ambient air, and any other 
environmental medium.

          "Environmental Laws" means all applicable federal, state, county 
and local Laws or regulations relating to human health and safety, 
protection of the environment or natural resources in existence on the 
date hereof.

          "ERISA" means the Employee Retirement Income Security Act of 1974, 
as amended. 

          "Final Determination" means, as applied to federal income taxes 
in respect of any item for a Period, (i) a final, unappealable decision by 
a court of competent jurisdiction with respect to such taxes, (ii) the 
expiration of the time for filing a claim for refund with respect to such 
taxes or, if a refund claim with respect to such taxes has been timely 
filed, the expiration of the time for instituting suit in respect of such 
refund claim, if no further adjustment to the items of income, gain, 
deduction, loss or credit for such Period may thereafter be made, (iii) 
the execution by or on behalf of the taxpayer and the IRS of a closing 
agreement under Section 7121 of the Code with respect to such taxes, 
(iv) the acceptance by the IRS of a tender pursuant to an offer in 
compromise with respect to such taxes pursuant to Section 7122 of the 
Code, (v) the execution of a Form 870AD with respect to such taxes or 
(vi) any other final and irrevocable determination of the tax liability 
with respect to such taxes of a party to this Agreement (or an Affiliate 
of a party) for the Period.  In the context of state or local income taxes
in respect of any item for a Period, "Final Determination" means any final, 
unappealable and irrevocable determination of the tax liability of a party 
to this Agreement (or an Affiliate of a party) with respect to such taxes 
for the Period.

          "GAAP" means generally accepted accounting principles in the 
United States in effect from time to time applied consistently throughout 
the period involved.

          "Governmental Authority" means any Canadian or United States 
federal, state, provincial or local government or any other foreign 
government, or any governmental, regulatory or administrative authority, 
agency or commission or any court, tribunal, or judicial or arbitral body.

          "Knowledge of the Seller" or "to the Seller's knowledge" means, 
with respect to matters relating to the Seller, the actual knowledge of 
the senior executive officers of the Seller with respect to such matters 
and, in the case of any matters relating to the Company or any of the 
Subsidiaries, such knowledge as is obtainable after the Seller's due 
inquiry of the senior executive officers of the Company set forth in
Section 1.01 of the Seller Disclosure Schedule.

          "Law" means any U.S. or Canadian federal, state, local or foreign 
statute, law, ordinance, regulation, rule, code, order, rule of any U.S. or 
Canadian administrative body, other requirement or rule of law.

          "Leased Property" means any real property listed in Section 
3.16(b) of the Seller Disclosure Schedule.

          "Loan Property" means any property, other than single-family 
residences and Real Estate Owned, securing a loan held by the Company or 
any Subsidiary, or, where required by the context, the Company or any 
Subsidiary is deemed by a court of competent jurisdiction to be the owner 
or operator of such property.

          "Loss" or "Losses" means any and all losses, liabilities, 
obligations, damages, claims, awards or judgments actually suffered or 
incurred by a party including legal costs and expenses to the extent 
provided in Section 10.03(d), but excluding incidental, special, indirect 
or consequential damages, loss of profits or similar damages.

          "Material Adverse Effect" means any change in, or effect on, 
CTUS, the Company or the Subsidiaries, as the case may be, that is 
materially adverse to the results of operations, financial condition or 
properties and assets of CTUS, the Company and the Subsidiaries, taken as 
a whole; provided, however, that changes or effects resulting directly or 
indirectly from (i) changes in Laws or GAAP (or interpretations thereof),
(ii) changes in the general level of market interest rates, (iii) changes 
in the economic, financial or market conditions affecting the banking or 
thrift industry generally in the regions in which CTUS, the Company or 
the Subsidiaries operate, (iv) the effect of any sale or other disposition 
of loans or any other transaction affecting CTUS, the Company or the 
Subsidiaries to the extent the same is made pursuant to, or as permitted or
contemplated by, this Agreement or with the Purchaser's prior written consent 
or at its written direction, or (v) the announcement of this Agreement or 
the transactions contemplated hereby, shall not constitute or contribute to a 
Material Adverse Effect.

          "Minority Shares" means any shares of the Company not owned by CTUS
on the date hereof.

          "Non-Compete Area" means New York State.

          "Period" means, in respect of a particular Tax, the taxable year or 
any other period for which such Tax is imposed.

          "Person" means any individual, partnership, firm, corporation, 
limited liability company, association, trust, unincorporated organization 
or other entity, as well as any syndicate or group that would be deemed to be 
a person under Section 13(d)(3) of the Securities Exchange Act of 1934, as 
amended.

          "Post-Closing Period" means any Period that begins after the Closing 
Date, and, with respect to any Period beginning before and ending after the 
Closing Date, shall mean the portion of such Period commencing on the day 
following the Closing Date.

          "Pre-Closing Period" means any Period that ends on or before the 
Closing Date, and, with respect to any Period beginning before and ending after 
the Closing Date, shall mean the portion of such Period ending on the Closing 
Date.

          "Purchaser Disclosure Schedule" means the Disclosure Schedule of the
Purchaser dated as of the date hereof, delivered by the Purchaser to the Seller 
upon the execution and delivery of this Agreement.

          "Real Estate Owned" means real estate acquired through foreclosure 
or through a deed in lieu of foreclosure.

          "Real Property" means any real property currently or formerly owned 
(but, in the case of formerly owned property only with respect to the period of 
time owned by CTUS, the Company or any Subsidiary) by CTUS, the Company or any 
Subsidiary and all improvements related thereto, including but not limited to 
owned branch offices, but not including Real Estate Owned or Leased Property.

          "Release" shall have the meaning as defined in or pursuant to the
Comprehensive Environmental Response, Compensation, and Liability Act.

          "Returns" means any report, information statement, return, 
declaration or other filing required to be supplied to any taxing authority or 
jurisdiction with respect to Taxes including any amendments thereto.

          "Seller Disclosure Schedule" means the Disclosure Schedule of the 
Seller, dated as of the date hereof, delivered by the Seller to the Purchaser 
upon the execution and delivery of this Agreement.

          "Subsidiary" means each corporation, bank, savings bank, association,
partnership or other entity in which the Company owns or controls 25% or more 
of the voting power of all outstanding voting securities or interests either 
directly or through an unbroken chain of entities as to each of which 25% or 
more of the voting power of all outstanding voting securities or interests is 
owned directly or indirectly by its parent; provided, however, that as used 
in Article III, other than in the first sentence of Section 3.05(b), 
"Subsidiary" shall not include any entity identified in Section 3.05(b) of
the Seller Disclosure Schedule as being an entity the equity securities or 
interests of which (i) have been acquired through foreclosure or (ii) are 
owned or controlled in a fiduciary capacity.

          "Tax" or "Taxes" means all taxes, however denominated, including 
any interest or penalties that may become payable in respect thereof, imposed 
by any federal, state, local or foreign government or any agency or political 
subdivision of any such government, which taxes shall include, without 
limiting the generality of the foregoing, all net income, alternative or 
add-on minimum, gross income, gross receipts, sales, use, goods and services, 
ad valorem, earnings, franchise, profits, withholding, payroll, employment, 
excise, severance, stamp, occupation, premium, property, excess or windfall
profit or value added tax.

          "U.S.$" means United States dollars.

          SECTION 1.02.  Additional Defined Terms.  The following additional
defined terms shall have the meanings set forth in the sections of this 
Agreement listed below:

     Defined Term                 Section Where Defined
                                          
Audit Date                                   2.04(a)
Audit Date Balance Sheet                     2.04(a)
Audited Book Value                           2.04(b)
Audited Financial Statements                 3.09
Bank Merger                                  5.14(a)
Claim Deductible                             10.03(b)(ii)
Closing                                      2.03(a)
Closing Date                                 2.03(a)
Company                                      Recitals
Company Financial Statements                 3.09
Company Shares                               Recitals
Company's Accountants                        2.04(b)
Confidentiality Agreement                    5.05(a)
Contest                                      7.03(b)
CRA                                          3.23
CTUS                                         Recitals
CTUS Financial Statements                    3.08
CTUS Shares                                  Recitals
Differential Amount                          2.04(b)

Electronic Networks                          5.11
FDIA                                         3.03(b)
FDIC                                         3.03(b)
FIRREA Claim                                 5.09(a)
FIRREA Plaintiff                             5.09(a)
FIRREA Recovery                              5.09(a)
HOLA                                         3.03(b)
Indemnifiable Amount                         10.03(b)(ii)
Indemnification Event                        7.03(a)
Intercompany Obligations                     3.22
IRS                                          3.18(b)
Maximum Aggregate Indemnity Payment Amount   10.03(b)(iii)
Merger                                       5.14(a)
Merger Subsidiary                            5.14(a)
Merrill Lynch                                3.24
OTS                                          3.03(a)
PBGC                                         3.18(e)
Plans                                        3.18(a)
Post-Closing Date Tax benefit                7.02(c)
Preferred Stock                              5.09(b)
Preferred Stock Dividend Amount              5.09(b)
Preferred Stock Redemption Amount            5.09(b)
Public Voting Requirement                    5.11
Purchase Price                               2.02
Purchaser                                    Preamble
Purchaser Operating Approvals                4.05(a)
Purchaser's Accountants                      2.04(c)
Purchaser's Required Approvals               4.03(a)
Reports                                      3.14
Seller                                       Preamble
Seller Operating Approvals                   3.12(a)
Seller's Accountants                         2.04(c)
Seller's Required Approvals                  3.06(a)
SLHC Act                                     3.03(a)
Straddle Period                              7.01(c)
Subsidiary Shares                            3.05(b)
Surviving Corporation                        5.14(b)
Tax Liability Threshold Amount               7.01(d)
Unaudited Financial Statements               3.09


                                ARTICLE II

                             PURCHASE AND SALE

          SECTION 2.01.  Purchase and Sale.  On the terms and subject to the
conditions set forth in this Agreement, the Seller agrees to sell to the 
Purchaser, and the Purchaser agrees to purchase from the Seller, on the Closing 
Date, the CTUS Shares.

         SECTION 2.02.  Purchase Price.  The purchase price (the "Purchase 
Price") for the CTUS Shares shall be payable in New York in cash in the net 
amount of U.S.$620,000,000, free of any withholding, deduction or adjustment of 
any nature whatsoever, except as expressly provided for in Sections 2.04 and 
5.15 of this Agreement or as required by Law.  The Purchase Price shall be 
payable as provided in Section 2.03(c).

          SECTION 2.03.  Closing.  (a)  Subject to the terms and conditions of 
this Agreement, the sale and purchase of the CTUS Shares contemplated hereby 
shall take place at a closing at the offices of Shearman & Sterling, 599 
Lexington Avenue, New York, New York (the "Closing") at 10:00 a.m., local 
time, on the first Business Day of the month following the month in which the 
conditions to Closing set forth in Article VIII are first satisfied or waived 
(on the understanding that such conditions shall continue to have been 
satisfied or waived immediately prior to the Closing) or at such other time 
or on such other date or at such other place as the Seller and the Purchaser 
may mutually agree upon in writing (the day on which the Closing takes place 
being the "Closing Date"); provided, however, that, at any time and from 
time to time, the Seller may, at its option, and without consequences of any 
kind or nature, delay the Closing, until a date no later than the first 
Business Day of March 1997.

          (b)  At the Closing, the Seller shall deliver or cause to be 
delivered to the Purchaser (i) certificates evidencing the CTUS Shares duly 
endorsed in blank, in proper form for transfer or accompanied by stock powers 
duly executed in blank and (ii) the certificates and other documents required 
to be delivered pursuant to Section 8.02(a).  

          (c)  At the Closing, the Purchaser shall deliver to the Seller (i) the
Purchase Price by wire transfer in immediately available funds to no more than 
ten (10) accounts designated by the Seller in writing at least two Business 
Days prior to the Closing Date and (ii) the certificates and other documents 
required to be delivered by the Purchaser pursuant to Section 8.01(a).

          SECTION 2.04.  Purchase Price Adjustment.  The parties hereto
acknowledge that the Purchase Price is to be adjusted as specified in this 
Section 2.04 for the purposes described in Section 2.05:

          (a)  As promptly as practicable, but not later than 60 days after the
Closing Date, the Seller and the Purchaser shall cause CTUS to prepare and
deliver to the Seller and the Purchaser an interim consolidated balance sheet 
for CTUS as of the end of the month immediately preceding the Closing Date 
in a manner consistent with past practice (for ease of reference being referred 
to herein as the "Audit Date Balance Sheet" and the date thereof being referred 
to herein as the "Audit Date").

          (b)  Following preparation of the Audit Date Balance Sheet by CTUS,
The Purchaser shall cause CTUS to request the Company's independent
accountants, Deloitte & Touche LLP (the "Company's Accountants"), (i) to 
audit the Audit Date Balance Sheet in accordance with generally accepted 
auditing standards, (ii) to prepare a schedule to the Audit Date Balance 
Sheet showing (x) the Book Value of CTUS as of the Audit Date on the basis 
of the Audit Date Balance Sheet (the "Audited Book Value"), (y) the 
calculation of the Agreed Minimum Audit Date Book Value on the basis of the 
Audit Date Balance Sheet (including the Covered Period Net Earnings, the 
Earnings Amount, the Employee Amount and the BIF/SAIF Amount) and (z) the 
amount, if any, by which the Audited Book Value exceeds or is less than the 
Agreed Minimum Audit Date Book Value (the "Differential Amount") and (iii) 
to deliver a copy of the items noted in (ii) above and an unqualified 
report stating that the Audit Date Balance Sheet fairly presents, in all 
material respects, the financial condition of CTUS as of the Audit Date and 
the schedule thereto fairly presents, in all material respects, the 
information contained therein, in each case in accordance with GAAP and on 
a basis consistent with prior audited balance sheets of CTUS.  The Seller 
shall pay the fees and expenses of the Company's Accountants incurred by 
them in preparing the Audit Date Balance Sheet and responding to any 
questions or disputes arising in connection therewith.
     
          (c)  Within 20 Business Days following the receipt by the Purchaser 
and the Seller of the Audit Date Balance Sheet, each of the Seller's 
Accountants and the Purchaser's independent accountants KPMG Peat Marwick 
LLP (the "Purchaser's Accountants") shall have an opportunity to make such 
investigation of the accounting records of CTUS (and the pertinent portions 
of the relevant work papers of the Company's Accountants) as any of the 
Purchaser, the Seller, the Seller's independent accountants Price Waterhouse 
LLP (the "Seller's Accountants") and the Purchaser's Accountants shall deem 
necessary and, if the Seller's Accountants or the Purchaser's Accountants 
desire, to meet with the Company's Accountants to discuss the determination 
of the Audited Book Value, the Agreed Minimum Audit Date Book Value and the 
Differential Amount.  If, within such 20 Business Day period, the Seller's 
Accountants and/or the Purchaser's Accountants disagree with the amount or 
calculation of any of the foregoing and/or believe that the Audited Balance 
Sheet does not fairly present the financial condition of CTUS, as of the 
Audit Date, in all material respects in accordance with GAAP, then, in 
either such event, either of the Seller's Accountants and/or the Purchaser's 
Accountants may provide the Company with written notice of any such 
disagreement or belief (together with relevant supporting details) and 
thereafter the Seller's Accountants, the Purchaser's Accountants and the 
Company's Accountants shall promptly attempt to resolve any differences or 
concerns that may exist, it being agreed that if such accountants shall be 
unable within a period of 10 Business Days to resolve the differences and
reach agreement, then, in such event, the Purchaser and the Seller will 
endeavor in good faith to resolve the differences amongst themselves during 
an additional period of 10 Business Days.  If, after this additional 10 
Business Day period, the Purchaser and the Seller have failed to so agree, 
the disputed items shall be submitted for final resolution to an independent 
accounting firm selected and agreed to by the Seller's Accountants and the 
Purchaser's Accountants or, if such accountant is unavailable, to such 
other independent accountant as to which the Seller and the Purchaser shall 
agree, which accountant shall be instructed to apply GAAP (and no other 
standards unless agreed to by both parties hereto), to attempt to resolve 
any such dispute and, following any such resolution, determine whether and 
to what extent, if any, the Audited Book Value or the Agreed Minimum Audit 
Date Book Value should be modified or changes should be made to the Audit 
Date Balance Sheet, which determination shall be required to be completed 
within 15 Business Days and shall be final and binding on the parties 
hereto absent manifest error.  The Seller and the Purchaser shall each 
bear one-half of the fees and expenses of such other independent accounting 
firm as is appointed, if any, by the Purchaser and the Seller as 
contemplated herein.

          (d)  Subject to paragraph (c) above and the proviso set forth 
below (and notwithstanding anything to the contrary in Section 2.02), if 
there is a Differential Amount the Purchase Price shall be adjusted from the 
amount actually paid by the Purchaser in accordance with Section 2.03(c), 
and the Purchaser and the Seller agree to make payments to each other 
following the Closing as follows:

               (i)  if there is a Differential Amount as a result of the 
          Audited Book Value being greater than the Agreed Minimum Audit 
          Date Book Value, then, in any such case, the Purchaser shall make 
          an additional payment to the Seller in respect of the Purchase 
          Price in an amount equal to the sum of the Differential Amount 
          and interest at the rate of 6% per annum payable in respect of 
          the period commencing on the Closing Date and continuing through 
          and including the date on which payment in respect of the 
          Differential Amount is made; or 

               (ii) if there is a Differential Amount as a result of the 
          Audited Book Value being less than the Agreed Minimum Audit Date 
          Book Value, then, in any such case, the Seller shall refund to 
          the Purchaser an amount in respect of the Purchase Price in an 
          amount equal to the sum of the Differential Amount and interest 
          at the rate of 6% per annum payable in respect of the period 
          commencing on the Closing Date and continuing through and 
          including the date on which payment in respect of the 
          Differential Amount is made;

     provided, however, that in giving effect to any such increase or 
     decrease in the Purchase Price, the U.S. dollar amounts shall be 
     rounded up or down to the nearest full U.S. dollar.  Any payments 
     required to be made pursuant to this paragraph (d) shall be made by 
     wire transfer of immediately available funds to the account of the 
     Purchaser or the Seller, as the case may be, designated in writing
     not later than 15 Business Days after the date on which the Audit 
     Date Balance Sheet is finally determined in accordance with Section 
     2.04(c).

          (e)  For purposes of this Section 2.04, the Purchaser and the Seller 
     have agreed that each of the accountants referred to in this Section 
     2.04 is to find any adjustments necessary to cause the Audit Date 
     Balance Sheet, to be in accordance with GAAP, and the schedule 
     referred to in Section 2.04(b) to be in accordance with this Agreement.  
     Such adjustments shall be (i) individual items in excess of $1,000,000 
     and (ii) other items in excess of $250,000 but less than $1,000,000 
     that aggregate to $5,000,000 or more.

          SECTION 2.05.  Certain Accounting Matters.  (a)  In addition to 
the obligation of the Purchaser to pay the Purchase Price, (i) the Seller shall 
be entitled to the economic benefit of net earnings of the Company in an 
average amount of up to U.S.$5,300,000 for each month between July 1, 1996 
through and including the Closing Date plus the Deferred Tax Valuation 
Amount, (ii) the Company shall be obligated following the Audit Date to 
pay the Employee Amount to the extent not paid by the Company prior to the 
Audit Date and the Seller shall be entitled in the computation of the 
Agreed Minimum Audit Date Book Value to reverse the after-tax effect of any
actual accrual on or prior to the Audit Date by the Company with respect 
to the Employee Amount but not in excess of U.S.$16,000,000 on or prior to 
the Audit Date, (iii) the Company shall be obligated following the Closing 
to accrue or pay the      BIF/SAIF Amount and, to the extent that the Company 
has been required on or prior to the Audit Date, to fully expense or pay 
for such BIF/SAIF Amount, the Seller shall be entitled in the computation 
of Audited Book Value to reverse the after-tax effect of any payment or 
required accrual by the Company and (iv) the Seller shall be entitled to 
the benefit of the Deferred Tax Valuation Amount which, if not taken into 
income by the Company prior to the Audit Date, the Seller shall be entitled 
in the computation of Audited Book Value to increase such Book Value by the 
amount of the Deferred Tax Valuation Amount.

          (b)  For the avoidance of doubt, it is agreed that as a result of 
Section 2.05(a), there will be an increase in the retained earnings of the 
Company between the date hereof and the Closing Date which will enable the 
Seller to cause the Company to pay a larger extraordinary dividend as 
contemplated by and subject to the limitations contained in Section 5.07.  
For illustrative purposes, Exhibit 2.05(b) provides a sample calculation 
of the Audited Book Value of the Company.


                                ARTICLE III

               REPRESENTATIONS AND WARRANTIES OF THE SELLER

          The Seller represents and warrants to the Purchaser as follows:

          SECTION 3.01.  Organization and Authority of the Seller.  The Seller 
is a corporation duly organized and validly existing under the laws of Canada 
and has all necessary power (corporate or otherwise) and authority to enter 
into this Agreement, to carry out its obligations hereunder and to consummate 
the transactions contemplated hereby.  The execution and delivery of this 
Agreement by the Seller, the performance by the Seller of its obligations 
hereunder and the consummation by the Seller of the transactions 
contemplated hereby have been duly authorized by all requisite corporate
action on the part of the Seller.  This Agreement has been duly executed 
and delivered by the Seller, and (assuming due authorization, execution and 
delivery by the Purchaser) constitutes a legal, valid and binding 
obligation of the Seller enforceable against the Seller in accordance with 
its terms, subject to the effect of any applicable bankruptcy, 
reorganization, insolvency, moratorium or similar Laws affecting creditors' 
rights generally and by general principles of equity (whether considered 
in a proceeding at law or in equity).

          SECTION 3.02.  CTUS Representation.  CTUS has no direct or indirect
subsidiaries, equity investments or joint ventures except for the Company and 
the Subsidiaries.  CTUS is not a party to any mortgage, lease or other 
agreement except as set forth in Section 3.02 of the Seller Disclosure 
Schedule.  As of the Closing, CTUS shall have no assets other than the Company 
Shares and certain Minority Shares and shall have no liabilities, except as 
set forth on its unaudited balance sheet as of June 30, 1996 (parent only), 
a copy of which has heretofore been furnished to the Purchaser and receipt 
of which is hereby acknowledged.  Except as disclosed in Section 3.02 of the
Seller Disclosure Schedule, since the date of its organization CTUS has not 
engaged in any business or operations, except the ownership of the Company 
Shares and certain Minority Shares and has never had any employees or Plans.

          SECTION 3.03.  Organization and Qualification of CTUS, the 
Company and the Subsidiaries.  (a)  CTUS is (i) a corporation duly organized 
and validly existing under the laws of the State of Delaware and (ii) 
registered as a savings and loan holding company with the Office of Thrift 
Supervision ("OTS") under the Savings and Loan Holding Company Act, as 
amended (the "SLHC Act").  True and complete copies of the certificate of 
incorporation and bylaws (or equivalent organizational documents) of CTUS, 
as amended to the date of this Agreement, have been made available for review
by the Purchaser.

          (b)  The Company is a federally chartered stock savings and loan
association duly organized, validly existing and in good standing under the 
laws of the United States of America and engages only in activities (and 
holds properties only of the types) authorized by the Home Owners' Loan Act 
of 1933, as amended ("HOLA") and the OTS rules and regulations thereunder 
and not prohibited by HOLA or the Federal Deposit Insurance Act (the "FDIA")
and the rules and regulations promulgated by the Federal Deposit Insurance 
Corporation (the "FDIC") thereunder for federal savings associations.  The 
Company's deposit accounts are insured to the fullest extent permitted 
under applicable Law by the Savings Association Insurance Fund as 
administered by the FDIC.  The Company is a qualified thrift lender under 
section 10(m) of HOLA and is a member of the Federal Home Loan Bank of 
New York.  True and complete copies of the certificate of incorporation 
and bylaws (or equivalent organizational documents) of the Company, as 
amended to the date of this Agreement, have been made available for review 
by the Purchaser.

          (c)  Each Subsidiary is a corporation duly incorporated, validly 
existing and in good standing under the laws of its jurisdiction of 
incorporation.  True and complete copies of the certificate of incorporation 
and bylaws (or equivalent organization documents) of each Subsidiary, each 
of the foregoing as amended to the date of this Agreement, have been made 
available for review by the Purchaser.  Each Subsidiary engages only in 
activities permitted for subsidiaries or service corporations, as the case
may be, of federal savings associations. 

          (d)  Each of CTUS, the Company and each of the Subsidiaries has 
the requisite power and authority to own, operate or lease the properties 
and assets now owned, operated or leased by it and to carry on, in all 
material respects, that portion of the Business of CTUS, the Company and 
the Subsidiaries as is currently conducted by CTUS, the Company or such 
Subsidiary, as the case may be.  Each of CTUS, the Company and each 
Subsidiary is duly qualified to do business, and is in good standing, in
each jurisdiction where the character of its properties owned, operated or 
leased or the nature of its activities makes such qualification necessary, 
except for such failures to be qualified and in good standing which, 
individually or, to the Seller's knowledge, in the aggregate, would not 
have a Material Adverse Effect.

          SECTION 3.04.  Capital Stock of CTUS.  The Seller owns, directly 
or indirectly, all of the CTUS Shares, and as of the date hereof the CTUS 
Shares constitute all the issued and outstanding shares of capital stock 
of CTUS.  The CTUS Shares have been duly authorized and validly issued and 
are fully paid and nonassessable and were not issued in violation of any 
pre-emptive rights.  Other than the provisions hereof relating to the 
Preferred Stock, there are no outstanding options, warrants or rights of 
conversion or other rights, agreements, arrangements or commitments 
relating to the capital stock of CTUS obligating CTUS to issue or sell any 
of its shares of capital stock.  The Seller is the record and beneficial 
owner of the CTUS Shares, free and clear of all Encumbrances except as a 
result of the Seller's obligation to transfer the CTUS Shares to the 
Purchaser pursuant to this Agreement.  On the Closing Date, the Seller will 
cause to be transferred and delivered to the Purchaser valid title to all 
the CTUS Shares, free and clear of all Encumbrances.

          SECTION 3.05.  Capital Stock of the Company and the Subsidiaries.  
          (a)  The Company Shares have been duly authorized and validly issued 
and are fully paid and nonassessable and were not issued in violation of any 
pre-emptive rights.  The Company's issued and outstanding capital stock 
consists of 23,082,429 shares of common stock, 22,925,671 of which 
constitute the Company Shares.  CTUS is the record and beneficial owner 
of all of the Company Shares and at the Closing, assuming payment by the 
Purchaser of the Purchase Price as contemplated herein, will be the record and
beneficial owner of the Minority Shares (other than those Minority Shares 
disclosed in Section 3.21 of the Seller Disclosure Schedule as to which the 
Seller is unable to acquire as contemplated in Section 5.13), in each case 
free and clear of all Encumbrances, except as a result of the Seller's 
obligation to transfer the CTUS Shares to the Purchaser pursuant to this 
Agreement.  Except as disclosed in Section 3.05(a) of the Seller Disclosure 
Schedule, as of the date hereof, there are, and Seller has made or will make
arrangements so that at the Closing, assuming payment by the Purchaser of the 
Purchase Price as contemplated herein, there will be, no outstanding options, 
warrants or rights of conversion or other rights, agreements, arrangements or 
commitments relating to the capital stock of the Company obligating the 
Company to issue or sell any of its shares of capital stock, except as a 
result of the Seller's obligation to transfer the CTUS Shares to the 
Purchaser pursuant to this Agreement.  
  
          (b)  Section 3.05(b) of the Seller Disclosure Schedule sets forth, 
with respect to each Subsidiary, the authorized capital stock and the 
number and type of its issued and outstanding shares of capital stock 
(collectively, the "Subsidiary Shares").  The Subsidiary Shares constitute 
all the issued and outstanding shares of capital stock of the respective 
Subsidiaries.  The Subsidiary Shares have been duly authorized and validly
issued and are fully paid and nonassessable and were not issued in 
violation of any pre-emptive rights.  There are no outstanding options, 
warrants or rights of conversion or other rights, agreements, arrangements 
or commitments relating to the Subsidiary Shares obligating any Subsidiary 
to issue or sell any of its Subsidiary Shares.  The Company owns the 
Subsidiary Shares issued by the respective Subsidiaries, free and clear 
of all Encumbrances, except as set forth on Section 3.05(b) of the Seller 
Disclosure Schedule, and except for any restrictions on transfer to others 
arising out of this Agreement.

          (c)  Except as set forth in Section 3.05(c) of the Seller 
Disclosure Schedule, there are no stockholder agreements, voting trusts, 
proxies or other similar agreements or understandings in effect with 
respect to the voting or transfer of any of the CTUS Shares, the Company 
Shares or the Subsidiary Shares.

          (d)  Except as set forth in Section 3.05(d) of the Seller 
Disclosure Schedule, the Company does not own more than 5% of the voting 
power of all outstanding voting securities or interests of any corporation, 
limited liability company, business trust, limited partnership or other 
entity.

          SECTION 3.06.  Consents and Approvals.  (a)  The execution and 
delivery of this Agreement by the Seller does not, and the performance of 
this Agreement by the Seller will not, require any consent, approval, 
authorization or other action by, or filing with or notification to, any 
Governmental Authority, or any other Person, except (i) for the consents, 
approvals, authorizations, actions, filings or notifications described in
Section 3.06 of the Seller Disclosure Schedule or as otherwise necessary 
in order to permit the transfer of CTUS Shares by the Seller to an 
Affiliate as contemplated in Section 10.13 (the "Seller's Required 
Approvals"), (ii) for such consents, approvals, authorizations, actions, 
filings, or notifications, the failure to make or obtain which would not, 
individually or, to the Seller's knowledge, in the aggregate either 
(x) prevent or delay the Seller from performing any of its material 
obligations under this Agreement or (y) in the case of Seller's Required 
Approvals from persons other than any Governmental Authority, have a 
Material Adverse Effect, and (iii) as may be necessary as a result of 
any facts or circumstances relating solely to the Purchaser.  

          (b)  The Seller has no reason to believe that it will not be able 
to make or, on a timely basis, obtain all Seller's Required Approvals. 

          SECTION 3.07.  No Conflict.  Assuming all consents, approvals,
authorizations and other actions contemplated in Section 3.06 have been 
obtained and all filings and notifications listed in Section 3.06 of the 
Seller Disclosure Schedule have been made, and except as may result from 
any facts or circumstances relating solely to the Purchaser, and except 
as disclosed in Section 3.07 of the Seller Disclosure Schedule, the 
execution, delivery and performance of this Agreement by the Seller does 
not and will not (a) violate or conflict with the charter or by-laws or 
other organizational documents of the Seller, CTUS, the Company or the 
Subsidiaries, (b) except as would not (i) prevent the Seller from 
performing its material obligations under this Agreement or (ii) 
individually or, to the Seller's knowledge, in the aggregate, have a 
Material Adverse Effect, conflict with or violate any Law, rule, 
regulation, order, writ, judgment, injunction, decree, determination 
or award applicable to the Seller, CTUS, the Company or the Subsidiaries 
or (c) except as would not (i) prevent the Seller from performing any
of its material obligations under this Agreement or (ii) individually or, 
to the Seller's knowledge, in the aggregate, have a Material Adverse 
Effect, result in any breach of, or constitute a default (or event which 
with the giving of notice or lapse of time, or both, would become a 
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of any 
Encumbrance on any of the assets or properties of the Seller, CTUS, the 
Company or any of the Subsidiaries pursuant to, any note, bond, mortgage, 
indenture, contract, agreement, lease, license, permit, franchise or other 
instrument relating to such assets or properties to which the Seller, CTUS, 
the Company or any of the Subsidiaries is a party or by which any of such
assets or properties is bound or affected. 

          SECTION 3.08.  CTUS Financial Statements.  The audited 
consolidated financial statements of CTUS as of December 31, 1995 and the 
unaudited consolidated financial statements of CTUS as of June 30, 1996, 
each attached hereto as Exhibit 3.08 (the "CTUS Financial Statements"), 
have been prepared in accordance with GAAP and fairly present in all 
material respects the financial position and results of operations of
CTUS as of the respective dates thereof and for the periods covered thereby
(subject, in the case of the unaudited financial statements, to normal 
year-end adjustments) in conformity with GAAP.

          SECTION 3.09.  Company Financial Statements.  The audited 
consolidated financial statements of the Company and the Subsidiaries as 
of December 31, 1995 (the "Audited Financial Statements"), and the 
unaudited consolidated financial statements of the Company and the 
Subsidiaries as of June 30, 1996 (the "Unaudited Financial Statements"; 
together with the Audited Financial Statements, the "Company Financial
Statements"), each attached hereto as Exhibit 3.09, have been prepared 
in accordance with GAAP and fairly present in all material respects the 
financial position and results of operations of the Company and the 
Subsidiaries as of the respective dates thereof and for the periods 
covered thereby (subject, in the case of the Unaudited Financial 
Statements, to normal year-end adjustments) in conformity with GAAP.

          SECTION 3.10.  Absence of Certain Changes or Events.  (a)  Except 
as disclosed in Section 3.10 of the Seller Disclosure Schedule, from June 30, 
1996 to the date of this Agreement, the Business of CTUS, the Company and 
the Subsidiaries has been conducted in the ordinary course and consistent 
with past practice.

          (b)  From June 30, 1996 to the date of this Agreement, except as
set forth in Section 3.10 of the Seller Disclosure Schedule or as 
contemplated by this Agreement, there has not been:

          (i)  any instances of damage, destruction or loss to any of the 
     assets or properties of CTUS, the Company or any Subsidiary which, 
     either individually or in the aggregate, have had a Material Adverse 
     Effect;

          (ii) except in the ordinary course of business in connection with
     advances from the Federal Home Loan Bank of New York, any material
     Encumbrance of any kind created by CTUS, the Company or any 
     Subsidiaries or, to the knowledge of the Seller, created by any third 
     party or by operation of Law on any property or asset (whether 
     tangible or intangible) of CTUS, the Company or any Subsidiary;

          (iii)  any establishment, amendment to or increase in any bonus,
     insurance, severance, compensation, fringe benefit, welfare, deferred
     compensation, pension, retirement, profit sharing, stock option 
     (including, without limitation, any grant of any stock options, stock 
     appreciation rights, performance awards or restricted stock awards), 
     stock purchase or other employee benefit plans applicable to current 
     or former employees, directors or consultants of CTUS, the Company or 
     any Subsidiary (or with respect to which CTUS, the Company or any 
     Subsidiary may have any liability), or other increase in the 
     compensation payable or to become payable to any officer, director, 
     employee or consultant of CTUS, the Company or any Subsidiary, except, 
     in any case described above, (x) in the ordinary course of business 
     consistent with past practice or (y) as may be required by applicable 
     Law;

          (iv) any employment, consulting, stay bonus, severance or similar
     agreement entered into, amended, renewed or terminated with any officer,
     employee, director or consultant of CTUS, the Company or any Subsidiary 
     (or with respect to which CTUS, the Company or any Subsidiary may have 
     any liability);

          (v)  any sale, assignment, transfer, lease or other disposition or
     agreement to sell, assign, transfer, lease or otherwise dispose of any 
     of the fixed assets of CTUS, the Company or any Subsidiary having an 
     aggregate value exceeding U.S.$1,000,000;

          (vi) any acquisition (by merger, consolidation, or acquisition of 
     stock or assets) by CTUS, the Company or any Subsidiary of any 
     corporation, partnership or other business organization or division 
     thereof;

          (vii) except in the ordinary course of business in respect of 
     deposits taken, advances from the Federal Home Loan Bank of New York, 
     sales of securities with agreements to repurchase and endorsement of 
     instruments in the course of collection, (x) any incurrence by the 
     Company or any Subsidiary of any indebtedness for borrowed money, (y) 
     any issuance by the Company or any Subsidiary of any debt securities 
     or (z) any assumption, granting, guarantee or endorsement of, or other 
     accommodation arrangement making the Company or any Subsidiary 
     responsible for, the obligations of any individual or legal entity
     (other than the Company or another Subsidiary), in the case of (x), 
     (y) and (z) above, having an aggregate value exceeding U.S.$1,000,000;

          (viii) any change in any method of accounting or accounting 
     practice used by the Company or any Subsidiary, other than changes 
     required by GAAP or regulatory accounting requirements;

          (ix) any reclassification, combination, split, subdivision or any
     redemption, repurchase or other acquisition of the capital stock of, 
     or other equity interests in, CTUS, the Company or any Subsidiary, any 
     declaration or payment of any dividends or distributions (whether in 
     cash, securities or other property) with respect to the shares of the 
     Company, any issuance or sale of additional shares of the capital 
     stock of, or other equity interests in, CTUS, the Company or any
     Subsidiary or securities convertible into or exchangeable for such 
     shares or equity interests, or issuance or granting of any options, 
     warrants, calls, subscription rights or other rights of any kind to 
     acquire additional shares of such capital stock, such other equity 
     interests, or such securities;

          (x)  any amendment of organizational or governing documents of CTUS
     (except as provided in Section 5.09 with respect to the Preferred Stock), 
     the Company or any Subsidiary or any alteration or restructuring of the 
     capitalization of CTUS, the Company or any Subsidiary;

          (xi) any Material Adverse Effect; or

          (xii) except for this Agreement, any agreement to take any actions
     specified in this Section 3.10.

          SECTION 3.11.  Absence of Litigation.  Except as disclosed in Section 
3.11 of the Seller Disclosure Schedule, there are no claims, actions, 
proceedings or investigations pending or, to the Seller's knowledge, threatened 
against the Seller, CTUS, the Company or any Subsidiary, or any of their 
respective assets or properties, before any court, arbitrator or administrative,
governmental or regulatory authority that, individually or, to the Seller's 
knowledge, in the aggregate, would have a Material Adverse Effect or which seek 
to delay, prevent or restrict the consummation of the transactions contemplated 
hereby.  None of CTUS, the Company or any Subsidiary or any of their respective 
assets or properties is subject to any order, writ, judgment, injunction, 
decree, determination or award that would have a Material Adverse Effect. 

          SECTION 3.12.  Compliance with Laws.  (a)  Except as disclosed in
Section 3.12 of the Seller Disclosure Schedule, and except as would not have a 
Material Adverse Effect or a material adverse effect on the Seller's ability 
to perform its obligations under this Agreement, (i) each of CTUS, the Company 
and the Subsidiaries has obtained or made all permits, licenses, approvals, 
authorizations, registrations, qualifications and filings with and under all 
U.S. and foreign laws, authorities and agencies that are required to enable 
it to carry on its Business as currently conducted (the "Seller Operating 
Approvals"), (ii) all Seller Operating Approvals are in full force and effect 
and no suspension of such Seller Operating Approvals has been threatened in
writing and (iii) none of CTUS, the Company or any Subsidiary is in violation 
of any applicable Law.

          (b)  None of the Seller, CTUS, the Company or any of the Subsidiaries
is subject to any cease and desist order, written agreement or memorandum of
understanding with, is a party to any commitment letter or similar undertaking 
to, is subject to any order or directive by, or is a recipient of any 
extraordinary supervisory letter from, or has adopted any extraordinary board 
resolution at the request of, any Governmental Authority charged with the 
supervision or regulation of thrifts or thrift holding companies or engaged 
in the insurance of thrift deposits.

          SECTION 3.13.  Contracts.  Except as disclosed in Section 3.13 of the
Seller Disclosure Schedule, none of CTUS, the Company or any of the Subsidiaries
is, or has received written notice that any other party thereto is, in default 
of any contract, agreement, commitment, arrangement, lease, insurance policy 
or other instrument to which CTUS, the Company or any Subsidiary is a party or 
by which CTUS, the Company or any of the Subsidiaries, or any of their assets, 
business or operations, may be bound or affected except for such defaults 
which individually or, to the Seller's knowledge, in the aggregate would not 
have a Material Adverse Effect. 

          SECTION 3.14.  Reports.  Except as disclosed in Section 3.14 of the 
Seller Disclosure Schedule, the Seller, CTUS, the Company and each Subsidiary 
have filed all reports, registrations and statements, together with any 
required amendments thereto, that it was required to file with the OTS, the 
FDIC and any other applicable banking authorities (the "Reports").  As of 
their respective dates, the Reports complied in all material respects with 
all the rules and regulations promulgated by the OTS, the FDIC or other 
applicable banking authorities, as the case may be.  Copies of all the Reports
have been made available for review by the Purchaser.

          SECTION 3.15.  Taxes.  Except as set forth in Section 3.15 of the 
Seller Disclosure Schedule or except as would not have a Material Adverse 
Effect:

          (a)  Each of CTUS, the Company and each Subsidiary has filed, or has
     had filed on its behalf, in a timely manner (within any applicable 
     extension periods) with the appropriate taxing authority, all Returns with
     respect to Taxes of CTUS, the Company and each of the Subsidiaries other 
     than those Returns on which an immaterial amount of Taxes would properly 
     be shown;

          (b)  All such Returns are true, complete and accurate in all material
     respects;

          (c)  All material Taxes due and payable by or with respect to CTUS, 
     the Company and the Subsidiaries have been paid in full or have been 
     provided for in the books and records of CTUS, the Company or the 
     Subsidiaries, as the case may be, in accordance with GAAP;

          (d)  There are no outstanding agreements or waivers extending the
     statutory period of limitations applicable to any federal, state, local 
     or foreign income or other material Returns required to be filed by or 
     with respect to CTUS, the Company or any of the Subsidiaries;

          (e)  None of the Returns of or with respect to CTUS, the Company or
     any of the Subsidiaries is currently being audited or examined by any 
     taxing authority; 

          (f)  No deficiency for any income Taxes has been assessed with respect
     to CTUS, the Company or any of the Subsidiaries that has not been abated or
     paid in full;

          (g)  The federal income tax returns of CTUS, the Company and each of
     the Subsidiaries have been audited and settled, or are closed to 
     assessment, for all years through 1991;

          (h)  There is no claim or assessment outstanding, or, to the Seller's
     knowledge, threatened against CTUS, the Company or any of the Subsidiaries
     for any alleged deficiency in Taxes, and to the Seller's knowledge there 
     are no audits or investigations with respect to any liability of CTUS, 
     the Company or any of the Subsidiaries for Taxes;

          (i)  Each of CTUS, the Company and each of the Subsidiaries has to
     the extent material withheld from its employees (and timely paid to the
     appropriate taxing authority) the required amounts for all periods since 
     1991 in compliance with all tax withholding provisions of applicable 
     federal, state, local and foreign Laws (including, without limitation, 
     income, social security and employment tax withholding);

          (j)  Each of CTUS, the Company and each of the Subsidiaries has to
     the extent material withheld (and timely paid to the appropriate taxing 
     authority) the required amounts for all periods since 1991 in compliance 
     with all tax withholding provisions of applicable federal, state, local 
     and foreign Laws other than provisions relating to employee withholding 
     (including, without limitation, withholding) of tax on dividends, 
     interest and royalties and similar income earned by nonresident aliens 
     and foreign corporations and withholding of tax on dispositions of 
     United States real property interest);

          (k)  The Seller has furnished or made available to the Purchaser
     complete and accurate copies of all federal, state and local income and 
     franchise tax returns, and any amendments thereto, filed by CTUS, the 
     Company and the Subsidiaries for taxable years ending 1993 and 1994; 

          (l)  There is no contract or agreement in existence under which CTUS,
     the Company or the Subsidiaries have, or may at any time in the future 
     have, an obligation to contribute to the payment of any portion of a 
     Tax (or pay any amount calculated with reference to any portion of a Tax) 
     determined on a consolidated, combined or unitary basis with respect to 
     a group of corporations of which CTUS was not the common parent 
     corporation; and

          (m)  No consent has been filed relating to CTUS or the Company
     pursuant to Section 341(f) of the Code.

          SECTION 3.16.  Real Property.  Each parcel of real property, including
without limitation those properties set forth on Section 3.16(a) of the Seller 
Disclosure Schedule (which lists owned properties) and Section 3.16(b) of the 
Seller Disclosure Schedule (which lists leased properties), owned or leased by 
the Company or any Subsidiary is owned or leased, free and clear of all 
Encumbrances, except (a) as disclosed in Section 3.16(a) or Section 3.16(b) 
of the Seller Disclosure Schedule, (b) with respect to liens for Taxes and 
assessments not yet payable, (c) with respect to liens for Taxes, assessments 
and charges and other claims, the validity of which is being contested in good 
faith by appropriate proceedings and which are also identified in Section 
3.16(c) of the Seller Disclosure Schedule, and (d) with respect to imperfections
of title and other Encumbrances, the existence of which, individually and in 
the aggregate, would not have a Material Adverse Effect. 

          SECTION 3.17.  Environmental Matters.  Except as set forth in Section
3.17 of the Seller Disclosure Schedule or except as would not have a Material 
Adverse Effect:

          (a)  CTUS, the Company and each Subsidiary are and have been in
     compliance with all applicable Environmental Laws;

          (b)  There is no suit, claim, action or proceeding pending or, to the
     knowledge of the Seller, threatened, before any Governmental Authority or 
     other forum in which CTUS, the Company or any Subsidiary has been or, with 
     respect to threatened proceedings, is reasonably likely to be named as a 
     defendant (i) for alleged noncompliance (including by any predecessor) 
     with an Environmental Law or (ii) relating to the Release into or 
     presence in the Environment of any Chemical Substance;

          (c)  To the knowledge of the Seller, there are no facts or 
     circumstances which would provide a reasonable basis for any suit, claim, 
     action or proceeding as described in Section 3.17(b);

          (d)  To the knowledge of the Seller, there has been no release of a
     Chemical Substance in, on, under or affecting any Real Property, Leased
     Property, Real Estate Owned or Loan Property;

          (e)  None of the Real Properties or, to the knowledge of the Seller,
     none of the Leased Properties, Real Estate Owned or Loan Properties, is 
     on the National Priority List (NPL) or the Comprehensive Environmental 
     Response Compensation and Liability Information System (CERCLIS), or is 
     the subject of any investigation, remediation or cleanup of any 
     contamination or potential contamination;

          (f)  None of the Real Properties is subject to, or as a result of this
     transaction would be subject to, the requirements of the New Jersey 
     Industrial Site Recovery Act or the New Jersey Environmental Cleanup 
     Responsibility Act or, to the knowledge of the Seller, to any other state 
     or local Environmental Laws which require notice, disclosure, cleanup or 
     approval prior to transfer of such assets, properties, businesses or 
     operations or which would impose liens on such assets, properties, 
     businesses or operations; and

          (g)  Seller does not participate in the management of any Loan 
     Property within the meaning of 40 C.F.R. Section 300.1100(c).

          SECTION 3.18.  Employee Benefit Matters.  (a)  Section 3.18(a) of the
Seller Disclosure Schedule contains a true and complete list as of the date of 
this Agreement of all employee benefit plans and all bonus, stock option, stock
purchase, incentive, deferred compensation, retiree medical or other welfare 
plans or life insurance, supplemental retirement, severance or other employee 
benefit plans, programs, arrangements, agreements, commitments or payroll 
practices, in each case that are maintained by the Company and/or the 
Subsidiaries or to which the Company and/or the Subsidiaries contribute, that 
benefit or relate to current or former employees of CTUS, the Company and/or 
the Subsidiaries, or with respect to which CTUS, the Company and/or the 
Subsidiaries may incur any liability (including, without limitation, 
"employee benefit plans" within the meaning of Section 3(3) of ERISA, salary
continuation for disability, sick leave, employment agreements, consulting 
agreements, incentive compensation plans, company awards and executive 
compensation plans) (collectively, the "Plans").

          (b)  With respect to each Plan, the Seller has delivered or made
available to the Purchaser a true and correct copy of the following documents 
relating to the Plans, as applicable; (i) the most recent annual report (Form 
5500) filed or required to be filed with the Internal Revenue Service (the 
"IRS"); (ii) the Plan document and all amendments thereto; (iii) the trust 
agreement or funding vehicle and all amendments thereto; (iv) the Summary 
Plan Description and any Summary of Material Modification required under 
ERISA; (v) the most recent actuarial report or valuation relating to any
Plan subject to Title IV of ERISA or any other defined benefit Plan; (vi) 
the most recent determination letter, if any, issued by the IRS with respect 
to any Plan intended to be qualified under Section 401(a) of the Code; (vii) 
all material, written communications to employees or former employees within 
the past three years relating to any Plan or any other written communication 
in the past five years that was materially inconsistent with any Plan document 
or that could cause the Company to incur significant liability; and (viii) 
written descriptions of all non-written plans.

          (c)  Except as set forth in Section 3.18(c) of the Seller Disclosure
Schedule, the Plans that are intended to qualify under Section 401(a) of the 
Code are so qualified, the trusts maintained pursuant thereto are exempt from 
federal taxation under Section 501 of the Code and have received a determination
letter from the IRS to that effect and, to the Seller's knowledge, no event 
has occurred with respect to the operation of the Plans which could cause the 
loss of such qualification or exemption or the imposition of any material 
liability, penalty or tax under ERISA or the Code. 

          (d)  Neither the Company nor any of the Subsidiaries nor any of its or
their ERISA Affiliates (meaning any trade or business, whether or not 
incorporated, under common control with the Seller, CTUS, the Company or the 
Subsidiaries within the meaning of Section 414(b), (c), (m) or (o) of the Code) 
has contributed or been obligated to contribute within the six-year period 
ending on the Closing Date to any multiemployer plan which is described in 
Section 4001(a)(3) of ERISA.  None of the Plans are or have been subject to 
Section 4063 or 4064 of ERISA.

          (e)  Except as set forth in Section 3.18(e) of the Seller Disclosure
Schedule, there has been no "reportable event" as that term is defined in 
Section 4043 of ERISA and the regulations thereunder with respect to any Plans 
subject to Title IV of ERISA (nor will the transactions contemplated by this 
Agreement result in the occurrence of a reportable event described in Section 
4043(c)(9), (10), (11), (12) or (13) of ERISA), nor has there been any event 
requiring disclosure under Sections 4041(c)(3)(C) and 4063(a) of ERISA, 
excluding reportable events for which notice has been waived by the Pension 
Benefit Guaranty Corporation (the "PBGC").

          (f)  Except as set forth in Section 3.18(f) of the Seller Disclosure
Schedule, neither CTUS, the Company, the Subsidiaries, the Seller nor any 
"party in interest" or "disqualified person" with respect to any Plan, nor any 
Plan has engaged in a "prohibited transaction" within the meaning of Section 
4975 of the Code or Section 406 of ERISA which would result in a material 
liability to it.

          (g)  Neither CTUS, the Company nor any of the Subsidiaries nor any of
the ERISA Affiliates has any outstanding liability or is expected to incur any 
liability under or arising out of Title IV of ERISA to the PBGC, to a trust 
established under Section 4041 or 4042 of ERISA or to a trustee appointed under 
Section 4042 of ERISA, to any Plan or to any other Person (other than premiums 
due the PBGC, which premiums have been paid when due).

          (h)  With respect to each Plan, all contributions and premiums 
required by Law or by the terms of any Plan or any agreement related thereto 
have been timely made (without regard to any waivers granted with respect 
thereto), no accumulated funding deficiency (whether or not waived) or liquidity
shortfall exists with respect to any Plan subject to Section 412 of the Code or 
Section 302 of ERISA, all amounts properly accrued to date or as of the Closing 
Date as liabilities of CTUS, the Company or any Subsidiary that have not been 
paid have been properly recorded on the books of CTUS, the Company or the 
Subsidiary, as the case may be, and each payment required to be made by any 
Plan has been made when due and none of the assets of CTUS, the Company nor 
any of the Subsidiaries are the subject of any lien arising under Section 
302(f) of ERISA or Section 412(n) of the Code, and neither CTUS, the Company 
nor any of the Subsidiaries have been required to post security pursuant to 
Section 307 of ERISA or Section 401(a)(29) of the Code and, to the Seller's 
knowledge, facts do not exist which could be expected to give rise to such a 
lien or such posting of security.

          (i)  Each of the Plans has been maintained, in form and operation, in 
all material respects, in accordance with its terms and all provisions of 
applicable Law, including, without limitation, ERISA and the Code.  CTUS, the 
Company and each Subsidiary have complied in all material respects with the 
notice and continuation requirements of Section 4980B of the Code.

          (j)  Except as set forth in Section 3.18(j) of the Seller Disclosure
Schedule, there are no material pending or, to the Seller's knowledge, 
threatened claims, or lawsuits which have been asserted or instituted (and, to 
the Seller's knowledge, there are no facts or circumstances on which any such 
claims or lawsuits could be based) with regard to any of the Plans (other than 
claims for benefits made in the ordinary course of administration of the Plans).

          (k)  Except as disclosed in Section 3.18(k) of the Seller Disclosure
Schedule, the consummation of the transactions contemplated by this Agreement 
will not:  (i) entitle any employee, former employee or any other person to any
payment or (ii) accelerate the time of payment or vesting or increase the 
amount of compensation payable to any person or (iii) otherwise result in any 
"parachute payment" within the meaning of Section 280G of the Code.

          (l)  No event has occurred, or is expected to occur, as a result of 
or in connection with the transactions contemplated by this Agreement, in 
connection with which CTUS, the Company, any Subsidiary or any ERISA Affiliate, 
directly or indirectly, could be subject to any material liability under ERISA, 
the Code or any other Law applicable to any Plan, including, without 
limitation, Section 4971, 4975 or 4976 of the Code or Section 406, 502(i), 
502(l) or 4069 of ERISA, or under any agreement or Law pursuant to or under 
which CTUS, the Company, the Subsidiaries or any ERISA Affiliate has agreed 
to indemnify or is required to indemnify any person against liability incurred 
under, or for a violation of or failure to satisfy the requirements of, any 
such agreement, instrument or Law.

          (m)  Except as set forth in Section 3.18(m) of the Seller Disclosure
Schedule, no Plan provides benefits, including death or medical benefits 
(whether or not insured) with respect to any current or former employee of 
CTUS, the Company or any Subsidiary beyond his or her retirement or other 
termination of service (other than (i) coverage mandated by applicable Law, 
(ii) retirement or death benefits under any employee pension plan, (iii) 
disability benefits under any welfare plan that have been fully provided for 
by insurance or otherwise, (iv) deferred compensation benefits accrued as 
liabilities on the books of CTUS, the Company or the Subsidiaries or (v) 
benefits in the nature of severance pay).

          (n)  Except as disclosed in writing by the Company to the OTS with no
objection from the OTS, each employment agreement entered into by CTUS, the
Company or the Subsidiaries complies with OTS Regulation Section 563.39, the
compensation of officers, directors and employees of CTUS, the Company and 
the Subsidiaries complies with OTS Regulation Section 563.161(b), and the 
compensation arrangements of CTUS, the Company and the Subsidiaries are 
consistent with OTS Regulatory Bulletin RB27a.

          (o)  Except as described in Section 3.18(o) of the Seller Disclosure
Schedule, there is no announced plan, promise or legally binding commitment to 
create any additional Plans or to amend or modify any existing Plan.

          (p)  There has been no material adverse change in the funding status 
of the First Federal Savings and Loan Association of Rochester Pension Plan 
from the status reflected in such plan's actuarial report dated as of January 1,
1995.

          SECTION 3.19.  Labor Matters.  None of CTUS, the Company nor any of
the Subsidiaries is party to any labor agreements with respect to its 
employees with any labor organization, group or association and no labor 
organization or group of employees has made a pending demand for recognition, 
and there is no organizing activity involving the employees of CTUS, the 
Company or the Subsidiaries pending, or, to the Seller's knowledge, threatened, 
by any labor organization or group of employees.  Except as disclosed in 
Section 3.19 of the Seller Disclosure Schedule, or as would not have a 
Material Adverse Effect as of the date of this Agreement, (a) there is no 
unfair labor practice charge or complaint against the Company or any of the 
Subsidiaries pending, or to the Seller's knowledge threatened, before the 
National Labor Relations Board, any comparable state agency or any other 
Governmental Authority, (b) there is no labor strike, labor disturbance, work 
stoppage or other material labor dispute pending or to the Seller's knowledge 
threatened against the Company or any of the Subsidiaries and (c) there are 
no complaints, charges or claims pending with the courts or with a Governmental 
Authority or, to the Seller's knowledge, threatened for which the Seller,
CTUS or the Company has received notice, or based on, arising out of, in 
connection with or otherwise related to the employment by CTUS, the Company 
or the Subsidiaries of any of their employees, including any claim relating to 
employment discrimination, equal pay, employee safety and health, wages and 
hours or workers' compensation.  Except as disclosed in Section 3.19 of the 
Seller Disclosure Schedule, each of the Company and each Subsidiary is in 
material compliance with all applicable Laws respecting employment practices, 
terms and conditions of employment and wages and hours. 

          SECTION 3.20.  Insurance.  Except as set forth in Section 3.20 of the
Seller Disclosure Schedule, all material properties and risks of CTUS, the 
Company and the Subsidiaries are covered by valid and currently effective 
insurance policies or binders of insurance or programs of self-insurance in 
such types and amounts as are consistent with customary practices and standards 
of companies engaged in businesses and operations similar to those of CTUS, 
the Company and the Subsidiaries.

          SECTION 3.21.  Minority Shares.  The Seller has entered into such
arrangements and/or agreements as shall be necessary to cause CTUS to be the 
record and beneficial owner of all of the outstanding Minority Shares as of the 
Closing Date, except as disclosed in Section 3.21 of the Seller Disclosure 
Schedule.  Certificates evidencing all of the  Minority Shares, other than those
disclosed in Section 3.21 of the Seller Disclosure Schedule,  are being held in 
escrow by the Company pending delivery of the same to CTUS on the Closing Date.

          SECTION 3.22.  Intercompany Obligations.  Except as disclosed in 
Section 3.22 of the Seller Disclosure Schedule, as of the date hereof, there 
are no intercompany agreements or arrangements between CTUS, the Company and 
the Subsidiaries, on the one hand, and the Seller or any of its Affiliates, 
on the other hand (the "Intercompany Obligations").

          SECTION 3.23.  Community Reinvestment Act.  The Company (a)
received a rating of "outstanding" in its most recent examination with 
respect to the Community Reinvestment Act (the "CRA") and (b) has not been 
notified in writing with respect to supervisory concerns regarding its 
compliance with the CRA or, to the extent applicable, the New York Community 
Reinvestment Act.  

          SECTION 3.24.  Brokers.  Except for Merrill Lynch, Pierce, Fenner &
Smith Incorporated ("Merrill Lynch"), no broker, finder or investment banker 
is entitled to any brokerage, finder's or other fee or commission in 
connection with the transactions contemplated by this Agreement based upon 
arrangements made by or on behalf of the Seller.  The Seller is solely 
responsible for the fees and expenses of Merrill Lynch.



                                ARTICLE IV

              REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

          The Purchaser represents and warrants to the Seller as follows:

          SECTION 4.01.  Organization and Authority of the Purchaser.  The
Purchaser is a corporation duly organized, validly existing and in good 
standing under the laws of the State of Delaware and has all necessary power 
(corporate or otherwise) and authority to enter into this Agreement, to carry 
out its obligations hereunder and to consummate the transactions contemplated 
hereby.  The execution and delivery of this Agreement by the Purchaser, the 
performance by the Purchaser of its obligations hereunder and the consummation 
by the Purchaser of the transactions contemplated hereby have been duly 
authorized by all requisite corporate action on the part of the Purchaser.  
This Agreement has been duly executed and delivered by the Purchaser, and 
(assuming due authorization, execution and delivery by the Seller) constitutes 
a legal, valid and binding obligation of the Purchaser enforceable against 
the Purchaser in accordance with its terms, subject to the effect of any 
applicable bankruptcy, reorganization, insolvency, moratorium or similar laws 
affecting creditors' rights generally and by general principles of equity 
(whether considered in a proceeding at law or in equity).  The Purchaser 
directly owns all of the issued and outstanding shares of capital stock of 
Marine Midland Bank, a New York State chartered commercial bank.

          SECTION 4.02.  Organization of Marine Midland Bank.  Marine Midland
Bank is a New York State chartered commercial bank, duly organized, validly 
existing, and in good standing under the laws of the State of New York, and 
has the requisite corporate power and authority to own its assets and carry 
on its business as currently conducted.  The deposits of Marine Midland Bank 
are insured to the fullest extent permitted under applicable law by the Bank 
Insurance Fund of the FDIC.
 
          SECTION 4.03.  Consents and Approvals.  (a)  The execution and 
delivery of this Agreement by the Purchaser do not, and the performance of 
this Agreement by the Purchaser will not, require any consent, approval, 
authorization or other action by, or filing with or notification to, any 
Governmental Authority, or any other Person, except (i) for the consents, 
approvals, authorizations, actions or filings described in Section 4.03 of
the Purchaser Disclosure Schedule (the "Purchaser's Required Approvals"), 
(ii) for such consents, approvals, authorizations, actions, filings or 
notifications the failure to make or obtain which would not, individually or 
in the aggregate either, prevent or delay the Purchaser from performing any 
of its material obligations under this Agreement and (iii) as may be 
necessary as a result of any facts or circumstances relating solely to the
Seller.    

          (b)  The Purchaser has no reason to believe that it will not be able 
to make or, on a timely basis, obtain all the Purchaser's Required Approvals.

          SECTION 4.04.  No Conflict.  Assuming all consents, approvals,
authorizations and other actions contemplated in Section 4.03 have been 
obtained and all filings and notifications listed in Section 4.03 of the 
Purchaser Disclosure Schedule have been made and, except as may result from 
any facts or circumstances relating solely to the Seller, the execution, 
delivery and performance of this Agreement by the Purchaser do not and will 
not (a) violate or conflict with the charter or by-laws or other
organizational documents of the Purchaser, (b) except as would not prevent the
Purchaser from performing its material obligations under this Agreement, 
conflict with or violate any law, rule, regulation, order, writ, judgment, 
injunction, decree, determination or award applicable to the Purchaser, or 
(c) except as would not prevent the Purchaser from performing any of its 
material obligations under this Agreement, result in any breach of, or 
constitute a default (or event which with the giving of notice or lapse of
time, or both, would become a default) under, or give to others any rights 
of termination, amendment, acceleration or cancellation of, or result in the 
creation of any Encumbrance on any of the assets or properties of the 
Purchaser pursuant to, any note, bond, mortgage, indenture, contract, 
agreement, lease, license, permit, franchise or other instrument relating to 
such assets or properties to which the Purchaser or any of its respective 
subsidiaries is a party or by which any of such assets or properties is bound 
or affected.

          SECTION 4.05.  Compliance with Laws.  (a)  (i) Each of the Purchaser,
Marine Midland Bank and each subsidiary of Marine Midland Bank has or has 
obtained or made all permits, licenses, approvals, authorizations, 
registrations, qualifications and filings with and under all U.S. and foreign 
laws, authorities and agencies that are required to enable it to carry on its 
Business as currently conducted (the "Purchaser Operating Approvals"), (ii) 
all the Purchaser Operating Approvals are in full force and effect, and no 
suspension of such Purchaser Operating Approvals has been threatened in
writing and (iii) none of the Purchaser, Marine Midland Bank or any 
subsidiary of Marine Midland Bank is in violation of any applicable Law, 
except for such failures to obtain or have in full force and effect such 
Purchaser Operating Approvals, such suspensions of Purchaser Operating 
Approvals and such violations of Law as would not individually or, to the 
best of the Purchaser's knowledge, in the aggregate prevent the Purchaser 
from performing its material obligations under this Agreement.

          (b)  None of the Purchaser, Marine Midland Bank or any subsidiary of
Marine Midland Bank is subject to any cease and desist order, written agreement
or memorandum of understanding with, is a party to any commitment letter or 
similar undertaking to, is subject to any order or directive by, or is a 
recipient of any extraordinary supervisory letter from, or has adopted any 
extraordinary board resolution at the request of, any Governmental Authority 
charged with the supervision or regulation of banks or bank holding companies 
or engaged in the insurance of thrift deposits which would have a material 
adverse effect on the Purchaser's ability to perform its obligations under 
this Agreement.

          SECTION 4.06.  Absence of Litigation.  There are no claims, actions,
proceedings or investigations pending or, to the Purchaser's knowledge, 
threatened against the Purchaser, Marine Midland Bank or any subsidiary of 
Marine Midland Bank, or any of its or their assets or properties, before any 
court, arbitrator or administrative, governmental or regulatory authority 
which seek to delay, prevent or restrict the consummation of the transactions 
contemplated hereby.

          SECTION 4.07.  Securities Law.  The Purchaser understands and agrees
that it may not sell or dispose of any of the CTUS Shares or the Company Shares
other than pursuant to an effective registration statement under the 
Securities Act of 1933, as amended, or pursuant to an available exemption 
therefrom.

          SECTION 4.08.  Financing.  The Purchaser currently has, and at the
Closing will continue to have, all funds necessary to satisfy all of its 
obligations hereunder and to consummate the transactions contemplated by 
this Agreement on the terms set forth herein, and its ability to consummate 
such transactions is not dependent or conditional upon receipt of financing 
from any third party.

          SECTION 4.09.  Community Reinvestment Act.  Marine Midland Bank
received a rating of "satisfactory" in its most recent examination with 
respect to the CRA.  Marine Midland Bank has not been notified in writing 
with respect to supervisory concerns regarding its compliance with the CRA 
or, to the extent applicable, the New York Community Reinvestment Act.    

          SECTION 4.10.  Brokers.  No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection 
with the transactions contemplated by this Agreement based upon arrangements 
made by or on behalf of the Purchaser or any of its affiliates. 


                                 ARTICLE V

                           ADDITIONAL AGREEMENTS

          SECTION 5.01.  Conduct of Business Prior to the Closing.  (a)  Except
as otherwise provided or contemplated herein or in Section 5.01(a) of the 
Seller Disclosure Schedule, the Seller agrees that, between the date hereof and
the Closing Date and without the prior written consent of the Purchaser:

          (i)  it will not permit CTUS, the Company or the Subsidiaries to
     conduct their Businesses other than in all material respects in the 
     ordinary course and consistent with prior practice;

          (ii) it will cause CTUS, the Company and each Subsidiary to use
     reasonable efforts to preserve substantially intact the business 
     organization of their respective Businesses, to keep available to the 
     Purchaser the services of the employees of the Company and each 
     Subsidiary (but the Seller shall have no liability to the Purchaser for 
     the failure to keep the services of any employees who voluntarily 
     resign from employment by the Company or the Subsidiaries) and to
     use reasonable efforts to preserve the current relationships with their 
     respective customers, suppliers and other persons with which they have 
     significant business relationships;

          (iii) it will not permit CTUS, the Company or any Subsidiary to amend
     their respective charters, by-laws or similar organizational documents or 
     merge or consolidate, or obligate themselves to do so, with or into any 
     other entity; 

          (iv) it will not permit either CTUS, the Company or a Subsidiary:  
     (x) to change its accounting methods, principles or practices (other than 
     such changes required by GAAP or by applicable Law), (y) to establish or 
     increase any bonus, insurance, severance, deferred compensation, pension, 
     retirement, profit sharing, stock option (including, without limitation, 
     the granting of stock options, stock appreciation rights, performance 
     awards, or restricted stock awards), stock purchase or other employee 
     benefit plan, or otherwise increase the compensation payable or to become 
     payable to any officers or employees of either CTUS, the Company or a
     Subsidiary, except in the ordinary course of business consistent with
     past practice or as may be required by applicable Law or applicable 
     collective bargaining agreements or (z) enter into any employment or 
     severance agreement with any of its employees or establish, adopt, enter 
     into or amend any collective bargaining agreement; and 

          (v)  it will not permit CTUS, the Company or a Subsidiary to adopt any
     new Plan or to amend, modify or terminate any Plan (or commit, promise or
     communicate any intention to adopt any new Plan or amend, modify or 
     terminate any Plan), except as may be required by Law.

          (b)  Notwithstanding anything to the contrary in this Agreement and 
for the purpose of facilitating the establishment or maintenance of an insured 
depository institution and operation of a thrift or banking business in the 
United States, at any time on or prior to the Closing, CTUS may, with the 
consent of the Purchaser (which consent shall not be unreasonably withheld), 
but subject to compliance with all applicable Law, cause the Company to either 
(i) sell, transfer, assign or otherwise dispose of, to the Seller, or such of 
the Seller's Affiliates as the Seller shall have the right to determine up 
to U.S.$5,000,000 in fair market value of mortgage and other residential 
real estate or similar assets of the Company identified by the Seller together 
with the assumption by any such transferee of an equivalent amount of 
non-deposit liabilities of the Company so long as, after giving effect to 
the foregoing, the Book Value of the Company shall not be diminished by an 
amount greater than U.S.$5,000,000 from the amount thereof immediately prior 
to any such action or (ii) sell, transfer, assign or otherwise dispose of
all of the Company's assets and liabilities to a newly-established insured 
depository institution to be owned by CTUS (other than the limited amount of 
assets and liabilities contemplated in the preceding clause (i) and the FIRREA 
Claim) and thereafter transfer ownership of all of the Company Shares to the 
Seller and/or such of the Seller's Affiliates as the Seller may designate, 
in which event the purchase and sale contemplated hereunder shall, without 
any further action on the part of the parties hereto, be deemed to be amended 
to relate solely to the CTUS Shares and, indirectly, the shares of the
newly-established insured depository institution contemplated herein. 

          SECTION 5.02.  Investigation.  (a)  The Purchaser acknowledges and
agrees that it (i) has made its own inquiry and investigation into, and, based 
thereon, has formed an independent judgment concerning, CTUS, the Company and 
the Subsidiaries, (ii) has been furnished with or given adequate access to 
such information about CTUS, the Company and the Subsidiaries and the 
respective Businesses of CTUS, the Company and the Subsidiaries as it has 
requested, and (iii) will not assert any claim against the Seller, CTUS or 
the Company (except as contemplated or otherwise permitted by this Agreement) 
or any of their directors, officers, employees, agents, stockholders, 
affiliates, consultants, investment bankers, attorneys or representatives, 
or hold the Seller, CTUS or the Company or any such persons liable, for any 
inaccuracies, misstatements or omissions with respect to information (other 
than, in the case of the Seller, with respect to the representations, warranties
and information contained in this Agreement, including the Seller Disclosure 
Schedule or in any certificate or other document delivered to the Purchaser 
which certificate or other document was prepared in connection with the sale 
of the CTUS Shares) furnished by the Seller or such persons concerning the 
Seller, CTUS, the Company and the Subsidiaries or the Businesses of CTUS, the
Company and the Subsidiaries.

          (b)  In connection with the Purchaser's investigation of CTUS, the
Company and the Subsidiaries and the Businesses of CTUS, the Company and the
Subsidiaries, the Purchaser received from the Seller certain estimates, 
projections and other forecasts for CTUS, the Company and the Subsidiaries, 
and certain plan and budget information.  The Purchaser acknowledges that 
there are uncertainties inherent in attempting to make such estimates, 
projections, forecasts, plans and budgets, that the Purchaser is familiar 
with such uncertainties, that the Purchaser is taking full responsibility 
for making its own evaluation of the adequacy and accuracy of all estimates, 
projections, forecasts, plans and budgets so furnished to it, and that the
Purchaser will not assert any claim against the Seller or any of its 
affiliates or any of their directors, officers, employees, agents, 
stockholders, affiliates, consultants, investment bankers, attorneys or 
representatives, or hold the Seller or any such persons liable with respect 
thereto except as otherwise permitted under Section 10.03.  Accordingly, the
Seller makes no representation or warranty with respect to any estimates, 
projections, forecasts, plans or budgets referred to in this section other 
than as contemplated in Sections 3.08 and 3.09. 

          SECTION 5.03.  Access to Information.  (a)  From the date hereof until
the Closing Date, upon reasonable notice, the Seller shall, and shall cause 
CTUS and each of CTUS', the Company's and the Subsidiaries' officers, 
directors, employees, auditors and agents to, (i) afford the officers, 
employees and authorized agents and representatives of the Purchaser reasonable 
access, during normal business hours, to the offices, properties, books and 
records of CTUS, the Company and the Subsidiaries and (ii) furnish to the 
officers, employees and authorized agents and representatives of the Purchaser 
such additional financial and operating data and other information regarding 
the assets, properties, goodwill and Business of CTUS, the Company and the 
Subsidiaries as the Purchaser may from time to time reasonably request; 
provided, however, that such investigation shall not unreasonably interfere 
with any of the Business or operations of the Seller, CTUS, the Company, the 
Subsidiaries or any Affiliate of the Seller; and provided further that the 
Seller, CTUS, the Company and any Subsidiary shall not be required to breach 
or violate any confidentiality obligation contained in a written agreement, 
binding on any of the Seller, CTUS, the Company and any Subsidiary.

          (b)  In order to facilitate the resolution after the Closing of any 
claims made by or against or incurred by the Seller prior to the Closing 
arising out of or relating to its ownership of CTUS, the Company or any of 
the Subsidiaries, the Purchaser shall (i) afford the officers, employees and 
authorized agents and representatives of the Seller reasonable access, during 
normal business hours, to the offices, properties, books and records of the 
Purchaser, CTUS, the Company and the Subsidiaries, (ii) furnish to the officers,
employees and authorized agents and representatives of the Seller such 
additional financial and other information regarding CTUS, the Company and the 
Subsidiaries and the Businesses of CTUS, the Company and the Subsidiaries as 
the Seller may from time to time reasonably request and (iii) to the extent 
it does not unreasonably interfere with the discharge of their regular duties
make available to the Seller, the employees of CTUS, the Company and the 
Subsidiaries whose assistance, testimony or presence is necessary to assist 
the Seller in evaluating any such claims and in defending such claims, 
including the presence of such persons as witnesses in hearings or trials 
for such purposes; provided, however, that such investigation shall not 
 unreasonably interfere with the business or operations of the Purchaser, 
CTUS, the Company, the Subsidiaries or any Affiliate of the Purchaser or in
the case of CTUS, the Company and the Subsidiaries, their respective successors;
provided further that the Seller shall pay all out-of-pocket costs of the 
Purchaser, CTUS, the Company, the Subsidiaries or in the case of CTUS, the 
Company and the Subsidiaries, their respective successors and such employees 
incurred in connection with any such investigation and shall reimburse the 
Purchaser, CTUS, the Company, the Subsidiary or in the case of CTUS, the 
Company and the Subsidiaries, their respective successors by which each such 
employee is employed on a per diem basis based on the annual salary and 
benefits, fully costed, of all employees if, in the aggregate, such employees 
are required to devote more than fifty hours to responding to requests from
the Seller pursuant to this Section 5.03(b).

          SECTION 5.04.  Books and Records.  (a)  From the Closing Date until 
six years from the Closing Date or such longer period, if any, as is required 
by applicable Law relating to the Businesses and activities of CTUS, the 
Company and the Subsidiaries, the Purchaser agrees that it shall preserve and 
keep all books and records of CTUS, the Company and the Subsidiaries relating 
to the Pre-Closing Period.  Prior to expiration of six years from the Closing 
Date, before disposing of any of such books and records, the Purchaser shall 
give the Seller at least 90 calendar days' prior written notice of the 
proposed destruction specifying in reasonable detail in the manner currently
employed by the Company to catalog their books and records the books and 
records to be disposed of, and the Seller shall be given an opportunity, at 
its cost and expense, to remove and retain all or any part of such books and 
records as the Seller may select.  During such 90-day period, duly authorized 
representatives of the Seller shall, upon reasonable notice, have access 
thereto during normal business hours to examine, inspect and copy such books 
and records.

          (b)  If, in order properly to prepare documents required to be filed 
with Governmental Authorities or its financial statements, it may be necessary 
that either of the parties hereto or any successors be furnished with additional
information relating to CTUS, the Company and the Subsidiaries or their 
respective Businesses, and such information is in the possession of the other 
party hereto, such party agrees to use its best efforts to furnish such 
information to such other party, at the cost and expense of the party being 
furnished such information.

          SECTION 5.05.  Confidentiality.  (a)  The terms of the letter 
agreement dated as of June 17, 1996 (the "Confidentiality Agreement") between 
Merrill Lynch, on behalf of the Seller, and the Purchaser are hereby 
incorporated by reference and shall continue in full force and effect, except 
as inconsistent with the terms of this Agreement and provided that, if this 
Agreement shall terminate, as provided herein, the Confidentiality Agreement 
shall remain in full force and effect.

          (b)  Except to the extent disclosure is required by Law, or in 
response to any governmental or regulatory authority, or in connection with 
any litigation relating to an alleged breach of this Agreement, each party 
shall maintain the confidentiality of all information obtained from the other 
party hereto other than information that is otherwise publicly available and 
shall use such information only for purposes reasonably related to this 
Agreement and the transactions contemplated hereby.  If this Agreement is 
terminated, each of the parties hereto agrees to return promptly upon request 
all documents received from the other party that contain or embody information 
subject to this paragraph.

          (c)  The Seller acknowledges that, from and after the Closing, all
proprietary and confidential information of CTUS, the Company and the 
Subsidiaries shall be and become the property of the Purchaser, and the Seller 
agrees that it will not, and it will not permit any of its Affiliates to, use 
or disseminate such information for any purpose whatsoever.

          SECTION 5.06.  Authorizations; Consents and Notices.  (a)  Each party
hereto shall use reasonable efforts to obtain all authorizations, consents, 
orders and approvals of, and to give all notices to and make all filings with, 
all Governmental Authorities and other third parties that may be or become 
necessary for such party's execution and delivery of, and the performance of 
such party's obligations pursuant to, this Agreement and will cooperate fully 
with the other party in promptly seeking to obtain all such authorizations, 
consents, orders and approvals, giving such notices, and making such filings.  
The Purchaser acknowledges that it shall be solely responsible for obtaining 
the Purchaser's Required Approvals, and the Seller agrees to use reasonable 
efforts to assist the Purchaser in obtaining the Purchaser's Required 
Approvals on or prior to the Closing Date.  The Seller acknowledges that it 
will be solely responsible for obtaining the Seller's Required Approvals and 
the Purchaser agrees to use reasonable efforts to assist the Seller in 
obtaining the Seller's Required Approvals on or prior to the Closing Date.  
The parties hereto acknowledge that time shall be of the essence in this
Agreement and agree not to take any action that will have the effect of 
unreasonably delaying, impairing or impeding the receipt of any required 
authorizations, consents, orders or approvals.

          (b)  The Purchaser and its subsidiaries will use reasonable efforts to
assist the Seller in obtaining at or prior to the Closing any consents of third 
parties (other than Governmental Authorities) under any lease or contract to 
which the Company or any Subsidiary is a party, which consent is in the 
reasonable judgment of the Seller necessary or advisable in connection with 
the transactions contemplated by this Agreement, including, without limitation, 
(i) providing to such third parties (A) guarantees by the Purchaser of the 
obligations of CTUS, the Company or any Subsidiary under the subject lease or 
contract and (B) such financial statements and other financial information 
with respect to the Purchaser as such third parties may reasonably request
and (ii) agreeing to such adjustments to the terms of the subject lease or 
contract as would not, individually or in the aggregate, have a Material 
Adverse Effect.

          SECTION 5.07.  Pre-Closing Payments.  At or prior to the Closing Date,
the Seller shall have the right, and shall have the right to cause CTUS, the 
Company and the Subsidiaries, to terminate all of the Intercompany Obligations, 
it being understood that (a) at the Seller's discretion the Seller shall (to 
the extent permitted by applicable Law and regulation) cause the Company to 
pay an extraordinary dividend to CTUS at least sufficient to allow CTUS to 
satisfy or repay any Intercompany Obligations and, subject to regulatory 
approval, to pay a dividend such that, after giving effect thereto, the
Book Value as of the date which is expected to be the Audit Date is not less 
than the Agreed Minimum Audit Date Book Value on such date and (b) to 
facilitate the transactions contemplated herein, the Seller may, but shall 
not be obligated to, cause CT North America L.L.C. to forgive, convert or 
otherwise restructure in accordance with applicable Law the intercompany debt 
in an amount of approximately U.S.$82,200,000 owed to it by CTUS so long as 
the foregoing shall result in an increase to the Book Value of CTUS in an 
amount not less than the aggregate outstanding principal amount of such debt 
and any accrued interest thereon; provided, however, that (i) the Seller shall
give the Purchaser five Business Days' prior written notice of any transaction 
described in this Section 5.07 specifying in reasonable detail the actions to 
be taken, (ii) after giving effect to the transactions described in such 
notice, the Book Value of CTUS shall be the Agreed Minimum Audit Date Book 
Value on such date and (iii) any Taxes arising from the payment of any dividend 
or the forgiveness, conversion or restructuring of any debt as contemplated 
in this Section 5.07 shall be expressly deemed to accrue, arise and be payable 
during a Pre-Closing Period.

          SECTION 5.08.  Notice of Events.  The Seller and the Purchaser shall
promptly notify each other of any event or circumstance which shall occur prior 
to the Closing which shall constitute a breach of a representation or warranty 
or a covenant or agreement of either the Seller or the Purchaser, such that it 
is reasonably likely that the conditions set forth in Section 8.01(a) or 
Section 8.02(a), as the case may be, will be incapable of being satisfied by 
the Closing Date.

          SECTION 5.09.  FIRREA Claim.  (a)  Assuming that the action 
contemplated in Section 5.01(b)(ii) shall not have been taken and 
notwithstanding anything herein to the contrary, the parties hereto agree (i) 
that any recovery (the "FIRREA Recovery") on the litigation filed by the 
Company in the United States Court of Claims styled First Federal Savings 
and Loan Association of Rochester v. United States, No. 95-517C (Ct. Cl. 
filed August 7, 1995), and any claim, right or administrative or judicial 
proceeding comprising, arising out of, or resulting from, that litigation (any
such claim, right or proceeding is referred to herein as the "FIRREA Claim") 
shall be for the account of the Seller, (ii) that the Seller shall have the 
sole and exclusive right to direct the prosecution of the FIRREA Claim as 
hereinafter provided, (iii) that the Purchaser, the Company and/or any 
successor-in-interest thereto which holds the FIRREA Claim (the "FIRREA 
Plaintiff") shall take all action reasonably requested by the Seller from 
time to time with respect to the FIRREA Claim, it being understood and
agreed that, in furtherance thereof, the FIRREA Plaintiff's actions shall be 
subject to the conditions set forth in Exhibit 5.09(e), (iv) that the FIRREA 
Plaintiff shall be under no obligation whatsoever to take any action in 
respect of the FIRREA Claim in the absence of direction from the Seller, 
(v) that the FIRREA Plaintiff shall take no action subsequent to the Closing
with respect to the FIRREA Claim that reasonably can be expected to adversely 
affect the likelihood, timing, nature, or amount of any such recovery and 
(vi) that the Seller shall pay all costs and expenses of prosecution of the
FIRREA Claim at the direction of the Seller, including, without limitation, 
all costs and expenses of the FIRREA Plaintiff, the Purchaser or any 
subsidiary of the Purchaser incurred in connection therewith, including, 
without limitation, all fees and disbursements of counsel to the FIRREA 
Plaintiff chosen by Seller as provided in Section 5.09(d).

          (b)  In furtherance of the foregoing (and without in any way 
intending to limit the right and ability of the Seller and the Purchaser to 
consider and agree on other appropriate courses of action, including any 
action or arrangement that is intended to maximize or preserve the value of 
the FIRREA Claim to the Seller, by, among other things, requiring that the 
FIRREA Plaintiff hold the FIRREA Recovery in trust for the benefit of the 
holder of the Preferred Stock), the Purchaser understands and agrees that,
prior to consummation of the transactions contemplated hereby, the Seller 
may cause CTUS to amend its organizational documents to provide for the 
issuance of, and to cause CTUS to issue by way of dividend or otherwise, 
shares of a new class of non-voting preferred stock (the "Preferred Stock") 
having terms and conditions as set forth in Exhibit 5.09(b), including, 
without limitation, terms that require CTUS (or any successor-in-interest):  
(i) (A) to pay a dividend on the Preferred Stock in an amount equal to the
aggregate amount of any cash received by the FIRREA Plaintiff as part of 
the FIRREA Recovery, (B) to make a distribution in kind on the Preferred 
Stock of any non-cash property, right or benefit received by the FIRREA 
Plaintiff as part of the FIRREA Recovery which can be transferred to the 
Seller without impairment in value and (C) to pay a dividend on the 
Preferred Stock, but only at the time actually realized by the FIRREA 
Plaintiff and only in the aggregate amount of the actual proceeds (net of 
any costs of sale incurred with the consent of the Seller) or benefit of 
any non-cash property, right or benefit received by the FIRREA Plaintiff as 
part of the FIRREA Recovery which cannot be transferred to Seller, without 
impairment in value, as determined by an independent internationally 
recognized investment bank mutually chosen by the Seller and the FIRREA 
Plaintiff, in each case net of any applicable Taxes, the amount of
which shall be computed at the maximum applicable marginal statutory tax 
rate in effect at the time of the FIRREA Recovery (the "Preferred Stock 
Dividend Amount") (which amount or in-kind distribution shall be subject to 
any applicable withholding taxes); and (ii) to redeem the Preferred Stock 
at par value plus the amount by which the Preferred Stock Dividend Amount 
exceeds any dividends paid or in kind distributions made on the Preferred 
Stock prior to redemption (the "Preferred Stock Redemption Amount");
provided that the terms and conditions of the Preferred Stock shall be 
substantially in conformity with the terms and conditions set forth in 
Exhibit 5.09(b) or otherwise reasonably acceptable to the Purchaser.  
Notwithstanding the foregoing, (x) at any time prior to the Closing, the 
Company shall have the right, without the consent of the Purchaser, to 
transfer the FIRREA Claim to the Seller, any of its Affiliates or a newly-
created or existing Subsidiary of the Company and the right to transfer the 
shares of any such Subsidiary to the Seller, or any of its Affiliates and 
(y) at any time following the Closing, at the request of the Seller, the 
Purchaser shall transfer or cause the FIRREA Plaintiff to transfer the 
FIRREA Claim to the Seller or such Affiliate of the Seller as the Seller 
shall designate and, in either case, the Purchaser agrees that subject to 
clauses (iii), (iv) and (vi) of paragraph (a) above, following the Closing 
and for so long as the FIRREA Plaintiff is a subsidiary of the Purchaser it 
shall and shall cause the FIRREA Plaintiff, CTUS and/or the appropriate 
Subsidiaries to cooperate fully (including joining as a party) in the 
prosecution of the FIRREA Claim. 

          (c)  Pursuant to the terms and conditions of the Preferred Stock, 
on the first Business Day following the later of (i) 30 days after the receipt
of the FIRREA Recovery by the FIRREA Plaintiff and (ii) 90 days after the 
commencement of the taxation year of the FIRREA Plaintiff in which the FIRREA 
Recovery is received, CTUS shall declare and pay a cash dividend or make a 
distribution in-kind on the Preferred Stock as provided above and shall pay 
any cash by wire transfer in immediately available funds to one or more 
accounts designated by the holder(s) of the Preferred Stock and make any 
in-kind distribution in a commercially reasonable manner.  If the amount of 
any FIRREA Recovery is reduced due to any set off, counterclaim, or other
reduction successfully asserted by the U.S. Government against the FIRREA 
Plaintiff arising out of a claim (i) against the FIRREA Plaintiff or any of 
its Affiliates unrelated to the FIRREA Claim and (ii) in the case of a claim 
against the Company, relating to a period or events following the Closing 
Date, in addition to the payments and distributions otherwise contemplated to 
be paid or made by the issuer of the Preferred Stock pursuant to this 
paragraph (c), the amount includable in the Preferred Stock Dividend Amount 
shall, notwithstanding anything hereto to the contrary, be increased by
an amount equal to the amount of such set off, counterclaim or other 
reduction at the time and in the manner of such other payments made by CTUS 
pursuant to this paragraph (c).

          (d)  So long as, following the Closing, the FIRREA Claim shall be held
in the name of the FIRREA Plaintiff, (i) the Seller shall have the right to 
direct the FIRREA Plaintiff with respect to the prosecution of the FIRREA 
Claim, through counsel of the Seller's own choosing, at the Seller's own 
expense, and (ii) the FIRREA Claim shall not be collected, settled, compromised,
abandoned or otherwise resolved by the FIRREA Plaintiff except on terms and 
conditions to which the Seller shall have provided its express written consent. 
Subject to clauses (iii), (iv) and (vi) of paragraph (a) above, the Purchaser 
shall cooperate fully and, following the Closing, for so long as the FIRREA 
Plaintiff is a subsidiary of the Purchaser, shall cause the FIRREA Plaintiff,
CTUS and/or the appropriate Subsidiaries to cooperate fully (including joining 
as a party) in the prosecution of such FIRREA Claim with the Seller.  For so 
long as the FIRREA Plaintiff is a subsidiary of the Purchaser, the Purchaser 
shall promptly empower, and shall cause the FIRREA Plaintiff promptly to empower
(by power of attorney and such other documentation as may be necessary and 
appropriate), such representatives of the Seller as the Seller may designate to 
represent the FIRREA Plaintiff in the FIRREA Claim, including the power to 
enter into any settlement or compromise concerning such claim.

          SECTION 5.10.  No Solicitation.  Except for the individuals listed on
Section 5.10 of the Seller's Disclosure Schedule, the Seller agrees that, from 
the date hereof until the expiration of the two-year period following the 
Closing (a) the Seller shall not, directly or indirectly, solicit or induce 
any employee of CTUS, the Company or the Subsidiaries to leave such employment 
and become an employee of the Seller or any of its Affiliates and (b) the 
Purchaser, CTUS, the Company and the Subsidiaries shall not, directly or 
indirectly, solicit or induce any employee of the Seller or any Affiliate of 
the Seller to leave such employment and become an employee of the Purchaser, 
CTUS, the Company or the Subsidiaries or any of their Affiliates; provided, 
however, that nothing in this Section 5.10 shall prohibit the Seller or any 
of its Affiliates or the Purchaser, CTUS, the Company or the Subsidiaries or 
any of their Affiliates from employing any person (i) who contacts them on 
his or her initiative and without any direct or indirect solicitation by the 
Seller or any of their Affiliates or the Purchaser, CTUS, the Company or the 
Subsidiaries or any of their Affiliates, as the case may be, or (ii) after 
expiration of the two-year period following the Closing Date.

          SECTION 5.11.  Covenant Not to Compete.  The Seller and its 
subsidiaries shall not (a) for a three-year period following the date hereof, 
establish a savings and loan association operating in the Non-Compete Area, 
(b) utilize the name or current logos of the Company or use in any way any 
proprietary customer list or other similar record of the Company as of the 
Closing Date or (c) for a three-year period commencing on the date hereof, 
open or establish any new permanent offices or branches of a physical nature 
or any physical proprietary ATM system (which for greater certainty excludes 
any shared electronic, telephonic or computer-related networks, ATM system,
Interac or internet systems ("Electronic Networks")) for deposit-gathering 
activities within the Non-Compete Area; provided, however, that nothing 
herein shall in any way limit the ability of the Seller or any of any such 
subsidiaries, including, without limitation, any new savings and loan 
association, savings bank, commercial bank or commercial or consumer lending 
company hereafter established by or for the benefit of the Seller or any of its
Affiliates, to (w) establish a permanent head office or other place of business
within the Non-Compete Area, but only if required for the Seller to obtain a 
license or charter to establish and/or operate an insured depository 
institution (as defined in the FDIA) to enable the Seller, in its discretion, 
to continue to operate a banking or thrift business in the United States, or 
(x) subject to compliance with clause (b) above, solicit deposits
from any location outside the Non-Compete Area by any means or from within the
Non-Compete Area by electronic means, computer-related or telephonic activity, 
whether or not through Electronic Networks, or (y) subject to compliance with 
clause (b) above, offer or solicit loans or other financial products or other 
services whether or not within the Non-Compete Area or (z) acquire any Person 
that has an existing permanent office, branch or branches of a physical nature 
or physical proprietary ATM system (excluding any Electronic Networks) for 
deposit-gathering, lending or other financial services activities within the 
Non-Compete Area which competes with the Company within the Non-Compete Area.  
Notwithstanding the foregoing, (A) in the event of an assignment contemplated 
in Section 10.13, the restriction imposed by this Section 5.11 shall not bind
the assignee but shall continue solely to bind CT Financial Services, Inc. 
and its subsidiaries and (B) the restriction imposed on the Seller and its 
subsidiaries under this Section 5.11 shall automatically cease to be of any 
further force and effect and the Seller and its subsidiaries shall have no 
further obligation hereunder to the Purchaser or any of its subsidiaries in 
the event that at any time during such three-year period from the date
hereof: 

          (i)  there is a "change in control" of the Seller, Canada Trustco
     Mortgage Company or The Canada Trust Company (whether directly or 
     indirectly through a change in control of the direct or indirect 
     controlling shareholder of the Seller, Canada Trustco Mortgage Company 
     or the Canada Trust Company) which shall be deemed to have occurred if 
     any Person or combination of Persons other than a Person currently 
     controlling any of the foregoing through any transaction or series of 
     transactions (whether by purchase, merger, consolidation, amalgamation 
     or otherwise) beneficially acquiring, directly or indirectly, (x) 75%
     or more of the issued and outstanding voting securities or shares of 
     the Seller or The Canada Trust Company, or (y) 75% or more of the issued 
     and outstanding voting securities or shares of Canada Trustco Mortgage 
     Company until such date (currently June 1, 1997) as the Canada Trustco 
     Mortgage Company is required to satisfy the 35% or other specified 
     public voting requirement (the "Public Voting Requirement") under the 
     Loan and Trust Companies Act (Canada) or (z) after the satisfaction of 
     the Public Voting Requirement, 65% (or such other percentage of voting 
     shares remaining after the Public Voting Requirement has been met) of
     the issued and outstanding voting securities or shares of Canada Trustco 
     Mortgage Company; or 

          (ii) there is a sale, transfer, assignment or other disposition of 
     all or substantially all of the assets of the Seller, Canada Trustco 
     Mortgage Company or The Canada Trust Company through any transaction or 
     a series of transactions to a Person or combination of Persons other 
     than a Person currently controlling any of the foregoing.

          SECTION 5.12.  Environmental Audit.  Between the date hereof and the
Closing Date, in the event that, at the time of foreclosure on any real property
securing any loan, the Seller has actual knowledge that any Chemical Substance 
was or is present, manufactured, generated, used, recycled, reclaimed, released,
stored, treated or disposed of at, in or from such property, the Seller shall 
(a) provide notice thereof to the Purchaser, (b) at the written request and 
expense of the Purchaser, conduct an environmental audit prior to foreclosure 
to the extent that doing so will not adversely affect such foreclosure and 
(c) provide the results of such audit to, and consult with, the Purchaser 
regarding the significance of such audit prior to foreclosure on any such 
property.

          SECTION 5.13.  Minority Shares.  Between the date hereof and the
Closing Date, the Seller shall attempt to enter into such arrangements and/or
agreements with the holders of the Minority Shares listed in Section 3.21 of 
the Seller Disclosure Schedule, on terms disclosed or made available to the 
Purchaser, as shall be necessary for CTUS to acquire at its sole cost and 
expense all of the outstanding Minority Shares as of the Closing Date.

          SECTION 5.14.  Merger Structure.  The Seller and the Purchaser agree
within 30 days following the date hereof to attempt to restructure the 
transaction as a merger of CTUS with a wholly-owned subsidiary of the Purchaser 
and a merger of the Company with and into Marine Midland Bank, it being 
understood that (a) the Seller shall have no obligation to do so unless it 
shall, in its sole discretion, have determined that any such restructuring 
will not materially increase its Tax liabilities resulting from the 
consummation of the stock purchase transaction (including the issuance of the
Preferred Stock) provided for in this Agreement and (b) subject to the 
foregoing, both mergers shall be subject to approval by the respective boards 
and will only be effective contemporaneously with the Closing, but shall be 
on the following basis:

          (i)  The acquisition of CTUS by the Purchaser shall be effected 
     through the following transactions:  (A) on the Closing Date a wholly-owned
     subsidiary of the Purchaser (the "Merger Subsidiary") shall merge with and 
     into CTUS (the "Merger"); and (B) the Company shall, simultaneously with 
     the Merger or thereafter, merge with and into Marine Midland Bank, a 
     wholly-owned subsidiary of the Purchaser (the "Bank Merger"); 

          (ii) On the Closing Date, the Merger shall be effected by the Merger
     Subsidiary merging with and into CTUS, with CTUS being the surviving
     corporation (the "Surviving Corporation").  The separate corporate 
     existence of the Merger Subsidiary shall thereupon cease, and the Surviving
     Corporation shall thereupon become a wholly-owned subsidiary of the 
     Purchaser.  The Surviving Corporation shall continue to be governed by 
     the laws of Delaware, and its separate corporate existence with all of 
     its rights, privileges, immunities, powers and franchises shall continue 
     unaffected by the Merger.  At the Closing Date, the certificate of 
     incorporation and by-laws of CTUS in effect immediately prior to the 
     Closing Date shall continue to be the certificate of incorporation and 
     by-laws of the Surviving Corporation.  At the Closing Date, the 
     directors and officers of the Merger Subsidiary shall become the sole 
     directors and officers of the Surviving Corporation; and

          (iii) The Bank Merger shall be effected pursuant to the terms of an
     agreement and plan of merger substantially on terms attached hereto as
     Exhibit 5.14(c), as agreed to by the parties within 30 days of the date 
     hereof.

          SECTION 5.15.  FIRTPA Certificate.  The Seller shall provide the
Purchaser with a certificate that, as of the Closing Date, the CTUS Shares 
do not constitute a U.S. real property interest within the meaning of Section 
1445 of the Code, such certification to satisfy the requirements of Treasury 
regulation Sections 1.897-2(h) and 1.1445-2(c)(3).  If such certificate is 
not received, the Purchaser shall be entitled to withhold 10 percent of the 
purchase price as required by Section 1445 of the Code.

          SECTION 5.16.  Further Assurances.  Each party shall cooperate with 
the other, and execute and deliver, or use its best efforts to cause to be 
executed and delivered, all such other instruments, including instruments of 
conveyance, assignment and transfer, and take all such other actions 
consistent with the terms of this Agreement, as such party may reasonably be 
requested to take by the other party hereto from time to time, in order to 
effectuate the provisions and purposes of this Agreement and the transactions 
contemplated hereby.

          SECTION 5.17.  Transition.  Each party shall cooperate with the other
during the period from the date hereof to the Closing Date to effectuate the 
purposes of this Agreement and the transactions contemplated hereby and shall 
negotiate in good faith and in a commercially reasonable manner to resolve any 
issues which may arise during such period in order to enable the transactions 
contemplated hereby to be consummated.


                                ARTICLE VI

                             EMPLOYEE MATTERS

          SECTION 6.01.  Provision of Comparable Benefits.  (a)  The Purchaser
agrees that, for a period of one year after the Closing Date, the Purchaser 
shall (or shall cause any other appropriate subsidiary of the Purchaser to) 
provide each employee and each former employee of the Company and the 
Subsidiaries who was an employee of the Company or the Subsidiaries on the 
Closing Date with benefits (including, without limitation, welfare benefits) 
that are comparable in the aggregate, in the good faith determination of the 
Purchaser, to the benefits generally provided by the Purchaser to its own 
similarly situated employees.  Consistent with providing comparable benefits 
for one year as is set forth above, nothing in this Section shall affect the 
Purchaser's ability to determine the benefits to provide to any employee or 
former employee, or restrict the Purchaser's ability to terminate, modify or 
amend any Plan, program, arrangement or fringe benefit or to terminate, 
modify or amend the terms and conditions of employment of any individual.  
In no event shall the arrangements set forth herein in any way remove or 
diminish the Purchaser's obligation to comply with, and to provide benefits to 
the extent required by, Section 4980B of the Code with respect to any former 
employee of the Company or its Subsidiaries.

          (b)  With regard to those former employees of the Company or the
Subsidiaries who are receiving retiree health benefits as of the Closing Date,
for a period of one year following the Closing Date, the Purchaser agrees to 
elect either to continue the retiree health benefits such former employees 
were receiving immediately prior to the Closing Date or to provide such former 
employees with the retiree health benefits provided from time to time to 
similarly situated retirees of the Purchaser.

          (c)  To the extent service is relevant for vesting or benefit 
calculations or allowances (including, without limitation, entitlement to 
vacation and sick days) under any plan or arrangement maintained by the 
Purchaser in which employees or former employees of the Company or 
Subsidiaries who were employed by the Company or the Subsidiaries on the 
Closing Date participate, and to the extent permitted by applicable Law, in 
order to provide the benefits described in paragraph (a) above, such plan or
arrangement shall credit employees with service on or prior to the Closing 
Date with the Company or any of the Subsidiaries, if and to the same extent 
such service was credited under comparable plans of the Company or the 
Subsidiaries prior to the Closing Date in which such employees participated; 
provided, however, that the Purchaser shall have the right to offset the 
amount of any accrued benefit under any of the Purchaser's defined benefit 
pension plans in which an employee participates, by the accrued benefit under
any defined benefit pension plan sponsored by the Company or its Subsidiaries
as of the Closing Date.  Nothing herein shall require any such service to be 
credited to the extent it would result in an employee receiving duplicate 
benefits.

          SECTION 6.02.  Succession.  In the event the Purchaser, CTUS, the
Company or any of the Subsidiaries or any of their respective successors or 
assigns (i) consolidates with or merges into any other person and shall not be 
the continuing or surviving corporation or entity of such consolidation or 
merger or (ii) transfers all or substantially all of its properties and assets 
to any person, then, and in each such case, proper provision shall be made 
so that the successors and assigns of the Purchaser, CTUS, the Company or 
the Subsidiaries, as the case may be, shall assume the obligations set forth 
in this Article VI.

          SECTION 6.03.  Survival.  This Article VI shall survive the Closing as
provided in Section 10.01.


                                ARTICLE VII

                                TAX MATTERS

          SECTION 7.01.  Tax Indemnities.  (a)  Subject to Section 7.01(d), the
Seller shall indemnify the Purchaser and its Affiliates and hold them 
harmless from and against any liability for Taxes (other than conveyance taxes, 
which are allocated pursuant to Section 7.06) (i) imposed on CTUS, the Company 
and the Subsidiaries in respect of their income, business, property or 
operations for any Pre-Closing Period, (ii) attributable to any change in 
accounting method employed by CTUS, the Company or any Subsidiary prior to 
the Closing Date, (iii) attributable to discharge of indebtedness, if any, 
that may result from any capital contributions by the Seller (or any Affiliate 
of the Seller) to CTUS, the Company or any Subsidiary of any intercompany 
indebtedness owed by CTUS, the Company or any Subsidiary to the Seller (or any 
Affiliate of the Seller) or (iv) attributable to the issuance or redemption 
of the Preferred Stock and the receipt of the FIRREA Recovery (to the extent 
not taken into account in determining the Preferred Stock Dividend Amount) 
(but only to the extent that the amount of such Taxes is in excess of the 
amount accrued for Taxes (including for greater certainty any reserve for bad 
debts) in the books and records of CTUS, the Company and the Subsidiaries as
of the Closing Date); provided, however, that no indemnity shall be provided 
under this Agreement for any Taxes resulting from (x) a breach by the Purchaser 
of its obligations under this Agreement, (y) a reduction in any net operating 
loss, capital loss or tax credit carryover allocable to CTUS, the Company, or 
any Subsidiary or (z) any transaction of CTUS, the Company or any Subsidiary 
occurring after the Closing on the Closing Date.

          (b)  From and after the Closing Date, the Purchaser, its Affiliates, 
CTUS and the Company shall indemnify the Seller and its Affiliates and hold 
them harmless from and against all Taxes imposed on or with respect to CTUS, 
the Company or its Subsidiaries that are not subject to indemnification pursuant
to paragraph (a) of this Section 7.01.

          (c)  Any Taxes for a Period beginning before the Closing Date and
ending after the Closing Date (a "Straddle Period") shall be apportioned between
the Seller and the Purchaser, in the case of real and personal property taxes, 
and franchise taxes not based on gross or net income, capital (including net 
worth or long-term debt) or gross or net assets, on a per diem basis and, in 
the case of other Taxes (including sale and transfer Taxes not described in 
Section 7.06), shall be determined based on the actual operation of CTUS, the 
Company and the Subsidiaries, as the case may be, during the portion of such 
period that is a Pre-Closing Period and the portion of such period that is a 
Post-Closing Period.  Each such Pre-Closing Period and Post-Closing Period
shall be deemed to be a Period subject to the provisions of Sections 7.01(a) 
and 7.01(b) above.  Notwithstanding the foregoing, in the case of any Tax based 
upon or measured by capital (including net worth or long-term debt), gross or 
net assets or intangibles, the amount of such Tax allocated to the Pre-Closing 
Period shall be computed by reference to the average level of such items during 
the Pre-Closing Period; provided, however, that such method shall apply only 
where the relevant Law requires the use of average amounts and, in such a 
case, the frequency and method of averaging shall be as required by such Law.  
In any other event, the amount of such Tax shall be computed by reference to 
the level of such items on the Audit Date.

          (d)  The respective indemnification obligations of the Purchaser and 
the Seller pursuant to this Section 7.01 shall not be effective until the 
aggregate dollar amount of all Taxes which would otherwise be payable pursuant 
to this Article VII by such party exceeds U.S.$250,000 (the "Tax Liability 
Threshold Amount") and then only to the extent such aggregate amount exceeds 
the Tax Liability Threshold Amount.  

          (e)  Payment by an indemnitor of any amount due under this Section
7.01 shall be made within 30 days following written notice by the indemnitee 
that payment of such amounts to the appropriate tax authority is due, provided 
that the indemnitor shall not be required to make any payment earlier than two 
days before it is due to the appropriate tax authority.  If the Seller receives 
an assessment or other notice of Taxes due with respect to CTUS, the Company 
or any of its Subsidiaries for any Pre-Closing Period for which the Seller 
is not responsible, in whole or in part, pursuant to paragraph (a) of this 
Section 7.01 because all or a part of such Tax does not exceed the amount 
accrued for Taxes in the books and records of CTUS, the Company and its 
Subsidiaries as of the Closing Date, and the Seller pays such Tax, then the 
Purchaser, CTUS or the Company shall pay to the Seller, in accordance with the 
first sentence of this Section 7.01(e), the amount of such Tax for which the 
Seller is not responsible under Section 7.01(a).  In the case of a Tax that is 
contested in accordance with the provisions of Section 7.03, payment of such 
Tax to the appropriate tax authority will not be considered to be due earlier 
than the date of a Final Determination with respect to such Tax.

          SECTION 7.02.  Refunds and Tax Benefits.  (a)  The Purchaser shall
promptly pay to the Seller any refund or credit (including any interest paid or 
credited with respect thereto) received by the Purchaser, CTUS, the Company or 
any Subsidiary of Taxes relating to Pre-Closing Periods or attributable to an 
amount paid by or on behalf of the Seller under Section 7.01 or 5.09 but only 
if and to the extent that the aggregate amount of refunds and credits exceeds 
the aggregate amount that is included as an asset in respect of Taxes on the 
Audit Date Balance Sheet (not taking account of any aggregate valuation 
allowances against deferred tax assets remaining after giving effect to the 
Deferred Tax Valuation Amount (reduced by any Taxes thereon); provided, 
however, that payments with respect to credits shall be made no earlier than 
the time at which such credit reduces or could reduce the Tax liability of the 
Purchaser and its Affiliates, including CTUS, the Company or any Subsidiary.  
In the event that any refund or credit of Taxes for which a payment has been 
made pursuant to this Section 7.02 is subsequently reduced or disallowed, the 
Seller shall indemnify and hold harmless the payor for any Tax liability, 
including interest, assessed against such payor by reason of the reduction or 
disallowance.  The Purchaser shall, if the Seller so requests and at the 
Seller's expense, cause the relevant entity to file for and obtain any refund 
to which the Seller is entitled under this Section 7.02.  Subject to Section 
7.03, the Purchaser shall permit the Seller to control (at the Seller's expense)
the prosecution of any such refund claim, and shall cause the relevant entity 
to authorize by appropriate power of attorney such persons as the Seller shall 
designate to represent such entity with respect to such refund claim.  The 
obligations of the Purchaser pursuant to this Section 7.02(a) shall not be 
effective until the aggregate dollar amount of all amounts refunded and credited
exceeds $250,000, and then only to the extent that such aggregate amount exceeds
$250,000. 

          (b)  In the event and to the extent that the Seller receives a refund
or credit of federal, state or local taxes for any Pre-Closing Period 
attributable solely to the carryback of losses, credits or similar items 
arising in any Post-Closing Period and attributable to CTUS, the Company or 
any Subsidiary, the Seller shall promptly pay to the Purchaser the amount of 
such refund or credit, together with any interest paid or credited with 
respect thereto.  In the event that any refund or credit of Taxes for which a
payment has been made pursuant to this Section 7.02(b) is subsequently 
reduced or disallowed, the Purchaser shall indemnify and hold harmless the payor
for any Tax liability, including interest, assessed by reason of the reduction 
or disallowance.

          (c)  Any amount otherwise payable by the Seller under Section 7.01 
shall be reduced by any Tax benefit realized by the Purchaser, CTUS, the 
Company, any Subsidiary or any of their Affiliates in a Post-Closing Period (a 
"Post-Closing Date Tax Benefit") as a result of either an adjustment to Taxes 
for which the Seller is responsible under Section 7.01 (such as a timing 
adjustment resulting in a Tax deduction for CTUS, the Company or any 
Subsidiary for a Post-Closing Period) or a Tax deduction resulting from an 
indemnifiable payment of Taxes.  The amount of any Post-Closing Date Tax
Benefit shall be computed at the minimum applicable marginal statutory tax 
rate in effect at the time of computation.  Post-Closing Date Tax Benefits 
determined to be substantially likely to be realized not later than the taxable 
year during which an indemnity payment is determined to be due shall be 
considered to be realized currently for purposes of netting against such 
indemnity payment hereunder.  If a payment is made by the Seller in accordance 
with Section 7.01, and if in a subsequent taxable year an actual Post-Closing 
Date Tax Benefit is realized by the Purchaser, CTUS, the Company, any 
Subsidiary or any of their Affiliates (that was not previously taken into 
account pursuant to the preceding sentence to reduce an amount otherwise 
payable by the Seller under Section 7.01), the Purchaser, CTUS, the Company, 
any such Subsidiary or any such Affiliate shall pay to the Seller at the time 
of such realization the amount of such Post-Closing Date Tax Benefit to the 
extent that the Post-Closing Date Tax Benefit would have resulted in a 
reduction in the amount paid by the Seller under Section 7.01 if the 
Post-Closing Date Tax Benefit had been obtained in the year of such payment. 
Subject to the foregoing a Post-Closing Date Tax Benefit will be considered 
to be realized for purposes of this Section 7.02 at the time that it is 
reflected on a Tax return of the Purchaser, CTUS, the Company, any Subsidiary 
or any of their Affiliates.

          SECTION 7.03.  Contests.  (a)  After the Closing Date, the Purchaser 
shall notify the Seller in writing promptly and in any event within 30 days of 
the commencement of any Tax audit or administrative or judicial proceeding or 
of any demand or claim on the Purchaser, CTUS, the Company or a Subsidiary (an
"Indemnification Event"), which could give rise to a claim for indemnification 
under Section 7.01.  Such notice shall contain factual information (to the 
extent known to the Purchaser, CTUS, the Company or a Subsidiary) with respect 
to the Indemnification Event in reasonable detail and shall include copies of 
any notice or other document received from any taxing authority in respect 
thereof.  If the Purchaser fails to give the Seller notice within a reasonable 
period of time or in sufficient detail to apprise the Seller of the nature of 
the claim (in each instance taking into account the facts and circumstances 
with respect to such claim), the Seller shall not be liable under this 
Agreement for such claim to the extent, if any, that the rights of the Seller 
with respect to such claim are actually prejudiced.

          (b)  Subject to Section 7.03(d) below, the Seller may elect to direct,
through counsel of its own choosing and at its own expense, any audit, claim 
for refund and administrative or judicial proceeding involving any Tax Periods 
with respect to which indemnity may be sought from the Seller under Sections 
7.01 or 5.09 (any such audit, claim for refund or proceeding is referred to 
herein as a "Contest").  If the Seller elects to direct a Contest, it shall 
within 30 calendar days of receipt of the notice of the Indemnification Event 
relating to such Contest notify the Purchaser of its intent to do so and, if 
requested by the Purchaser, the Seller shall furnish to the Purchaser in due
course, as a condition to further pursuing such Contest, an opinion of the 
Seller's independent tax counsel to the effect that the Seller has a reasonable
basis to pursue such Contest.  If the Purchaser or an Affiliate is requested 
(or, if an election by the Seller is not timely made, shall determine) to pay 
the Tax claimed and sue for a refund, the Seller shall make a tentative 
indemnity payment to the party making such payment.  In the case of any 
Contest, the Purchaser or its Affiliate, as the case may be, shall not make 
payment of the Tax in question for at least 30 days (or such shorter period 
as may be required by applicable law) after the giving of notice to the Seller 
of its intention to do so (and if the Seller has elected to direct the Contest 
shall not make payment unless requested by the Seller), shall give to the 
Seller any information reasonably requested by the Seller relating to such 
Contest and otherwise shall cooperate with the Seller in good faith in order 
to contest effectively any such Contest, and to the extent not inconsistent
with the Purchaser's or its Affiliates' control over the portion of proceedings 
that relate to issues other than those subject to this indemnity (as described 
below), shall permit the Seller to control such proceedings relating to any 
Contest.  The Seller shall, on demand, reimburse all "out of pocket" costs 
and expenses which the Purchaser or its Affiliate may incur in connection 
with such Contest (but not in connection with exercising the right of
attendance described below), including, without limitation, reasonable 
attorneys' and accountants' fees and disbursements.   The Purchaser or its duly 
appointed representatives shall be allowed to attend all meetings between the 
Seller and the taxing authority in question and shall be provided with copies 
of all correspondence and documents relating to such Contest.  If the Seller 
fails to notify the Purchaser of its election as herein provided, then until 
receiving notification as to the Seller's intentions, the Purchaser, CTUS, 
the Company and/or the appropriate Subsidiary shall take such reasonable steps 
as may be prudent and within its capacity (with due allowance being given to 
the circumstances) to preserve the right of the relevant entity to contest the
asserted Tax liability, may pay, compromise or contest, such asserted Tax 
liability and shall be reimbursed by the Seller for the reasonable cost of 
outside professionals and outside disbursements incurred pursuant to this 
sentence to the extent attributable to a Tax liability indemnifiable by the 
Seller hereunder.  However, in each such case, neither the Purchaser nor CTUS 
nor the Company nor the Subsidiary may settle or compromise any asserted Tax 
liability over the objection of the Seller; provided, however, that consent 
to settlement or compromise shall not be unreasonably withheld.  If the
Purchaser, CTUS, the Company or any Subsidiary assumes control of a Contest with
respect to Taxes pursuant to the foregoing, provided that the Seller has acted 
in good faith, the Seller shall retain the right, at any time thereafter and 
immediately upon notice to the entity that shall have assumed control of such 
Contest, to assume itself, at the Seller's expense, sole direction and control 
of such Contest, as set forth above.  If the Seller chooses to direct the 
Contest, the Purchaser shall promptly empower and shall cause CTUS, the 
Company and/or the appropriate Subsidiaries promptly to empower (by power of 
attorney and such other documentation as may be necessary and appropriate) 
such representatives of the Seller as it may designate to represent the 
Purchaser, CTUS, the Company and/or the Subsidiaries in the Contest insofar as 
the Contest involves an asserted Tax liability for which the Seller could be 
liable under Section 7.01.

          (c)  The Seller may cause such a Contest to be prosecuted to a
determination in a court of initial jurisdiction and, if the Seller shall have 
furnished the Purchaser with an opinion of independent tax counsel to the 
effect that there is a reasonable basis to appeal the determination of any 
court, the Seller may cause such Contest to be prosecuted to a determination 
in an appellate court.  Notwithstanding any other provision of this Section 
7.03 the Seller shall not settle, compromise or abandon without the Purchaser's 
prior written consent any Contest which would materially and adversely affect 
the Tax liability of the Purchaser or its Affiliates in any Post-Closing 
Period (including material adverse changes resulting from the imposition of 
income Tax deficiencies, the reduction of asset basis or cost adjustments, the 
lengthening of any amortization or depreciation periods or the denial of 
amortization or depreciation deductions) determined taking into account the 
then present value of any Tax benefits available to the Purchaser, CTUS, the 
Company or any Subsidiary by reason of any such settlement (taken into account 
as and when the Purchaser reasonably believes such Tax benefits could be 
utilized to reduce the Tax liability of the Purchaser, CTUS, the Company or 
any Subsidiary).  Such consent shall not be unreasonably withheld.

          (d)  With respect to Contests relating to any Post-Closing Period
(including any Contest relating to, or arising out of, any FIRREA Recovery 
described in Section 5.09) the Purchaser shall control all proceedings taken in 
connection with such Contests except that the Seller shall control such 
proceedings to the extent that they relate to a matter in respect of which 
the Seller has indemnified the Purchaser under Section 7.01 or 5.09 (including, 
for greater certainty, any Tax proceedings with respect to a matter that could 
affect the amount of the Preferred Stock Dividend Amount); provided, however, 
that if the Seller shall request in writing in a timely manner and furnish the 
Purchaser an opinion of independent tax counsel to the effect that the Seller 
has a reasonable basis to pursue such Contest, the Seller may cause such 
Contest to be prosecuted to a determination in a court of initial jurisdiction; 
and, provided further that if the Seller shall request in writing in a timely 
manner and furnish the Purchaser an opinion of independent tax counsel to the 
effect that the Seller has a reasonable basis to appeal the determination of 
any court, the Seller may cause such Contest to be prosecuted to a 
determination in an appellate court. 

          (e)  If, after actual receipt by the Purchaser or its Affiliates of an
amount paid by the Seller as a tentative indemnity pursuant to paragraph (b), 
the extent of the liability of the Purchaser or its Affiliates with respect to 
the indemnified matter shall be established by a Final Determination, the 
Purchaser or its Affiliates, as the case may be, shall promptly pay to the 
Seller all or the portion of any refund received by or credited to the 
Purchaser or its Affiliates with respect to the indemnified matter (together 
with any interest paid or credit thereon by the taxing authority) plus (i) the
amount of the Tax savings, if any, realized by the Purchaser or its 
Affiliates as a result of such payment, and (ii) interest at the rate which 
shall be applicable under section 6621(a)(1) of the Code in respect of federal 
income taxes and at the rate provided by applicable law in respect of other 
Taxes from time to time from the date of actual collection by the Purchaser 
or its Affiliates of such refund (and any such interest thereon) to the date 
of payment to the Seller hereunder.

          (f)  Nothing contained herein shall require the Purchaser or its
Affiliates, as the case may be, (i) to pursue a Contest which it would not 
otherwise be required to pursue pursuant to this Agreement or (ii) to permit 
the Seller to control any such Contest, if the Purchaser shall waive the 
payment by the Seller of any amount that might otherwise be payable by the 
Seller hereunder by way of indemnity in respect of such Contest.  Upon any 
such waiver, the Purchaser or its Affiliates, as the case may be, shall 
repay to the Seller any payments made with respect to such Contest pursuant 
to Section 7.03(b) above together with interest at the rate which shall be 
applicable under section 6621(a)(1) of the Code from time to time from the 
date the payment was paid by the Seller to the date of repayment by the 
Purchaser or its Affiliate.

          SECTION 7.04.  Preparation of Tax Returns.  The Seller shall prepare 
and timely file, or cause to be prepared and timely filed, all Returns relating 
to CTUS, the Company and the Subsidiaries that are due (taking into account any 
applicable extension periods) no more than 30 days after the Closing Date.  The 
Purchaser shall prepare and timely file or cause CTUS and the Company and the 
Subsidiaries to prepare and timely file all Returns relating to CTUS and the 
Company or any of the Subsidiaries that are due (taking into account any 
applicable extension period) more than 30 days after the Closing Date.  Returns 
required to be filed by the Purchaser in respect of a Pre-Closing Period shall 
be prepared on a basis consistent with those prepared for prior tax years 
unless a different treatment of any item is required by an intervening change 
in Law.  The Purchaser shall furnish the Seller with a copy of any Return 
prepared by it for a Pre-Closing Period at least 20 days before the anticipated 
filing date thereof and, in preparing such Returns, shall accept any comments 
made by the Seller with respect to any issue or item which could give rise to 
a claim for indemnification; provided, however, that this sentence shall not 
apply in respect of any comments for which the Seller does not provide the 
Purchaser, if so requested in writing to do so, with an opinion of counsel
to the effect that there is a reasonable basis for Seller's comment.

          SECTION 7.05.  Cooperation and Exchange of Information.  Following the
Closing, the Seller and the Purchaser shall provide each other, and the 
Purchaser shall cause CTUS and the Company to provide the Seller, with such 
cooperation and information as reasonably may be requested in filing any Tax 
Return, amended return or claim for refund, determining a liability for Taxes 
or a right to a refund of Taxes or participating in or conducting any audit 
or other proceeding in respect of Taxes.  Such cooperation and information 
shall include providing copies of relevant Tax Returns or portions thereof, 
together with accompanying schedules and related work papers and documents 
relating to rulings or other determinations by taxing authorities.  Each of the
Seller, the Purchaser and the Company shall make its employees available on a 
mutually convenient basis to provide explanations of any documents or 
information provided hereunder.  The Seller, on the one hand, and the Purchaser,
CTUS and the Company, on the other, shall each retain all Returns, schedules and
work papers and all material records or other documents that are in its 
possession immediately following the Closing, or created by or on behalf of it 
thereafter, relating to Tax matters of CTUS, the Company and the Subsidiaries 
for the taxable period of each relevant jurisdiction first ending after the 
Closing Date and for all prior taxable periods until the later of (i) the 
expiration of the statute of limitations of the taxable periods to which such 
returns and other documents relate, without regard to extensions except to the 
extent notified by the other party in writing of such extensions for the 
respective Tax periods, or (ii) eight years following the due date (without 
extension) for such returns.  Any information obtained under this Section 7.05 
shall be kept confidential, except as may be otherwise necessary in connection 
with the filing of Returns or claims for refund or in conducting an audit or
other proceeding.

          SECTION 7.06.  Conveyance Taxes.  Notwithstanding any provision herein
to the contrary, the Seller agrees to assume liability for and to pay a maximum
of U.S.$500,000 of all sales, use, transfer, stamp, stock transfer, withholding,
real property transfer or gains, registration, recording taxes or fees, or any 
similar Taxes or fees incurred as a result of the sale of the transactions 
contemplated hereby, and the Purchaser agrees to assume liability for and to 
pay any such Taxes in excess of such amount.  

          SECTION 7.07.  Miscellaneous.  (a)  The parties agree that all 
payments made under this Article VII, under any other indemnity provision 
contained in this Agreement, and for any misrepresentations or breach of 
warranties or covenants shall constitute adjustments to the Purchase Price 
and that they shall report all such payments on that basis in all Returns 
filed with any taxation authority for purposes hereof.  If, contrary to the 
intent of the parties as expressed in the preceding sentence, any indemnity 
payment made pursuant to this Agreement is treated as taxable income of the 
recipient, then the payor shall indemnify and hold harmless the recipient 
from any liability for Taxes attributable to the receipt of such payment.

          (b)   Except as expressly provided otherwise and except for the
representations contained in Sections 3.15 and 3.18 of this Agreement, this 
Article VII shall be the sole provision governing Tax matters and indemnities 
therefor under this Agreement.

          (c)  For purposes of this Article VII, all references to the 
Purchaser, the Seller, CTUS, the Company or the Subsidiaries include successors 
in interest, whether by operation of Law or otherwise.

          (d)  The covenants and agreements of the parties hereto contained in
this Article VII shall survive the Closing and shall remain in full force and 
effect until the expiration of all statutes of limitations with respect to any 
Taxes that would be indemnifiable by the Seller under Section 7.01(a) of this 
Agreement or by the Purchaser under Section 7.01(b) of this Agreement.


                               ARTICLE VIII

                           CONDITIONS TO CLOSING

          SECTION 8.01.  Conditions to Obligations of the Seller.  The 
obligations of the Seller to consummate the transactions contemplated by this 
Agreement shall be subject to the fulfillment, at or prior to the Closing, of 
each of the following conditions:

          (a)  Representations and Warranties; Covenants.  The representations
     and warranties of the Purchaser contained in this Agreement shall be true 
     and correct in all material respects as of the Closing with the same force 
     and effect as if made as of the Closing, other than such representations 
     and warranties as are made as of another date, and all the covenants 
     contained in this Agreement to be complied with by the Purchaser on or 
     before the Closing shall have been complied with in all material respects, 
     and the Seller shall have received a certificate of the Purchaser to 
     such effect signed by a duly authorized officer of the Purchaser;

          (b)  No Orders or Litigation.  No Governmental Authority shall have
     enacted, issued, promulgated, enforced or entered any statute, rule, 
     regulation, executive order, decree, injunction or other order (whether 
     temporary, preliminary or permanent), which is in effect preventing or 
     prohibiting consummation of any of the transactions contemplated by this 
     Agreement (nor shall any proceeding for any such statute, rule, 
     regulation, order, decree or injunction be pending), nor shall there be 
     any proceeding initiated or pending by any Governmental Authority or any 
     other Person seeking the prevention or prohibition of the consummation of
     any of the transactions contemplated by this Agreement or money damages 
     as a result thereof, including any actions to be taken by either party 
     pursuant hereto, except for any such proceeding pending or threatened by 
     a Person (other than a Governmental Authority) seeking only money damages; 
     provided, however, that the provisions of this Section 8.01(b) shall not 
     apply if the Seller has directly or indirectly solicited or encouraged 
     any such action; and provided further that the Seller may invoke this 
     condition, only if it shall have used its reasonable efforts to have any 
     such order vacated; and

          (c)  Approvals and Consents.  The Seller's Required Approvals shall
     have been made or obtained and any waiting period (and any extension 
     thereof) with respect thereto shall have expired or terminated (except 
     where the failure to obtain any such Seller's Required Approval from a 
     Person other than a Governmental Authority would not result in a Material 
     Adverse Effect) and all such Seller's Required Approvals shall still be 
     in effect.

          SECTION 8.02.  Conditions to Obligations of the Purchaser.  The
obligations of the Purchaser to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior to the Closing, of 
each of the following conditions:

          (a)  Representations and Warranties; Covenants.  The representations
     and warranties of the Seller contained in this Agreement shall be true and 
     correct as of the Closing (without regard to any Material Adverse Change/
     Effect exceptions, thresholds or knowledge qualifiers contained therein) 
     with the same force and effect as if made as of the Closing, other than 
     such representations and warranties as are made as of another date 
     (including Section 3.10(b)) and except for such inaccuracies as, 
     individually or in the aggregate, do not have a Material Adverse Effect, 
     and all material covenants contained in this Agreement to be complied with 
     by the Seller on or before the Closing shall have been complied with in 
     all material respects, and the Purchaser shall have received a certificate 
     of the Seller to such effect signed by a duly authorized officer of the 
     Seller;

          (b)  No Orders or Litigation.  No Governmental Authority shall have
     enacted, issued, promulgated, enforced or entered any statute, rule,
     regulation, executive order, decree, injunction or other order (whether 
     temporary, preliminary or permanent), which is in effect preventing or 
     prohibiting consummation of any of the transactions contemplated by this 
     Agreement (nor shall any proceeding for any such statute, rule, regulation,
     order, decree or injunction be pending), nor shall there be any proceeding 
     initiated or pending by any Governmental Authority or any other Person 
     seeking the prevention or prohibition of the consummation of any of the 
     transactions contemplated by this Agreement or money damages as a result 
     thereof, including any actions to be taken by either party pursuant hereto,
     except for any such proceeding pending by a Person (other than a 
     Governmental Authority) seeking only money damages; provided, however, 
     that the provisions of this Section 8.02(b) shall not apply if the 
     Purchaser has directly or indirectly solicited or encouraged any such 
     action; and provided further that the Purchaser may invoke this condition 
     only if it shall have used its reasonable efforts to have any such order 
     vacated; and

          (c)  Approvals and Consents.  The Purchaser's Required Approvals shall
     have been made or obtained and any waiting period (and any extension 
     thereof) with respect thereto shall have expired or terminated (except 
     where the failure to obtain any such Purchaser's Required Approval from a 
     Person other than a Governmental Authority would not result in a Material 
     Adverse Effect) and all such Purchaser's Required Approvals shall still  
     be in effect. 



                                ARTICLE IX

                     TERMINATION, AMENDMENT AND WAIVER

          SECTION 9.01.  Termination.  This Agreement may be terminated at any
time prior to the Closing:

          (a)  by the mutual written consent of the Seller and the Purchaser; or

          (b)  by either the Seller or the Purchaser, if the Closing shall not 
     have occurred prior to the date one year after the date of this Agreement; 
     provided, however, that the right to terminate this Agreement under this 
     Section 9.01(b) shall not be available to any party whose failure to 
     fulfill any obligation under this Agreement shall have been the cause 
     of, or shall have resulted in, the failure of the Closing to occur prior 
     to such date.

          Time shall be of the essence in this Agreement.

          SECTION 9.02.  Effect of Termination.  In the event of termination of 
this Agreement as provided in Section 9.01, this Agreement shall forthwith 
become void and there shall be no liability on the part of any party hereto (i) 
except as set forth in Section 5.05 and Section 10.05 and (ii) nothing herein 
shall relieve either party from liability for any willful breach hereof.

          SECTION 9.03.  Waiver.  At any time prior to the Closing, any party
hereto may (a) extend the time for the performance of any of the obligations or 
other acts of the other parties hereto, (b) waive any inaccuracies in the 
representations and warranties contained herein or in any document delivered 
pursuant hereto or (c) waive compliance with any of the agreements or 
conditions contained herein.

          SECTION 9.04.  Termination Fee.  In the event that the Seller 
unilaterally terminates this Agreement by repudiating its obligations in 
writing following the acceptance of an unsolicited offer for the purchase of 
CTUS, the Company and the Subsidiaries, the Seller shall promptly pay to or 
on behalf of the Purchaser $35,000,000, payable in immediately available 
funds to an account designated by the Purchaser.  The Purchaser acknowledges 
that, upon receipt of such payment, the Purchaser shall be deemed to have 
waived all claims, demands, damages and causes of action, and shall have no 
further recourse, against the Seller pursuant to this Agreement, and the Seller
shall have no further obligation to the Purchaser or any other Person pursuant 
to this Agreement.


                                 ARTICLE X

                            GENERAL PROVISIONS

          SECTION 10.01.  Non-Survival of Representations, Warranties, Covenants
and Agreements.  The representations, warranties, covenants and agreements 
contained herein shall be deemed to be conditions to the purchase and sale of 
the CTUS Shares as contemplated in Sections 8.01(a) and 8.02(a) and, following 
the Closing and/or the termination of this Agreement pursuant to Section 9.01, 
shall not survive, shall expire, be terminated and extinguished and the 
Purchaser's sole and exclusive remedy for breach of any representation or 
warranty by the Seller hereunder or failure by the Seller to comply with its 
covenants shall be (a) to exercise its rights under the indemnity provided
pursuant to Section 7.01 in the case of any matter relating to Taxes and (b) 
in the case of any other matter, including any matters covered by any 
representations and warranties of the Seller contained herein (other than 
relating to Taxes, which shall be subject only to indemnification as 
contemplated in clause (a) above), solely to exercise its rights to 
indemnification under Section 10.03; provided, however, that (i) consistent 
with the foregoing, following the Closing the representations and warranties 
contained in Sections 3.02, 3.03, 3.04, 3.05, 3.10, 3.11 and 3.17 (but only to 
the extent set forth in Section 10.03 hereof) shall remain in full force and 
effect for eighteen months solely for purposes of providing the basis for 
the indemnity contemplated in Section 10.03, (ii) the covenants and agreements 
set forth in Sections 4.08, 5.02, 5.03(b), 5.04, 5.05, 5.09, 5.10 and 5.11
and Articles VI, VII and X, shall remain in full force and effect for the 
applicable periods specified in such Sections or Articles or, if in any such 
case no such period is specified, until the applicable period under the 
statute of limitations therefor has expired and (iii) following termination 
of the Agreement, the covenants and agreements set forth in Sections 9.02 
and 10.05 shall survive until the applicable statute of limitations thereof
has expired.

          SECTION 10.02.  Release and Indemnification.  (a)  The Purchaser 
agrees to use its reasonable efforts (not including prepayment or renegotiation 
of the terms of any indebtedness) to cause the Seller or any Affiliate of the 
Seller (other than CTUS, the Company or the Subsidiaries) to be absolutely 
and unconditionally released on or effective as of the Closing Date from each 
liability and other obligation, direct or indirect, primary or secondary, for 
the payment of money or otherwise, including purchase or indemnification, 
guarantees or performance bonds, in respect of any outstanding indebtedness 
or contingent liabilities of CTUS, the Company, or the Subsidiaries, or issued 
for the account of or on behalf of a customer of CTUS, the Company of the 
Subsidiaries.  The Purchaser agrees to continue to use its reasonable efforts 
after the Closing Date to relieve the Seller and its Affiliates of any such 
liabilities or obligations that are not released or otherwise discharged on or 
effective as of the Closing Date.  The Seller agrees promptly upon demand to 
reimburse the Purchaser, CTUS, the Company or a Subsidiary, as the case may 
be, for all out-of-pocket costs and expenses incurred by it in securing any 
such release or discharge.

          (b)  The Purchaser shall indemnify and hold harmless the Seller and
each of its Affiliates, officers, directors, employees, successors and assigns 
(each, a "Seller Indemnified Party") for any and all liabilities, obligations, 
losses, damages, claims, costs and expenses, interest, awards, judgments and 
penalties (including, without limitation, reasonable attorneys' and consultants'
fees and expenses) suffered or incurred by them (including, without limitation, 
any claim, action, proceeding or investigation brought or otherwise initiated 
by any of them) to the extent arising solely out of, or resulting from, the 
conduct of the Businesses by CTUS, the Company or the Subsidiaries or the
Purchaser following the Closing or the operations of CTUS, the Company or the
Subsidiaries or the Purchaser subsequent to the Closing; provided, however, 
that the foregoing shall not apply to any transaction entered into between any 
Seller Indemnified Party and the Purchaser, CTUS, the Company or any subsidiary 
of the Purchaser subsequent to the Closing.

          SECTION 10.03.  Indemnification by the Seller.  (a)  Subject to the
procedures set forth in this Section 10.03, the Seller shall indemnify the 
Purchaser, its Affiliates, officers, directors, employees, successors and 
assigns and hold the Purchaser harmless for Losses (other than with respect 
to Taxes the indemnity for which is solely and exclusively as provided in 
Article VII) which relate to a matter or circumstance arising prior to the 
Closing Date and which are discovered and communicated in writing to the Seller 
within eighteen months from the Closing Date (or, in the case of any matter 
covered by clauses (i) and (ii) below, the end of the applicable statute of 
limitations period) solely with respect to Losses arising out of:

          (i)  any transaction contemplated by this Agreement relating to the
     Minority Shares, including, but not limited to, any liability with respect 
     to any payment required by law to be made by the Purchaser and/or its 
     Affiliates subsequent to the Closing to those holders of Minority Shares 
     that shall not have sold their shares, options and/or other similar 
     interests in the Company to the Seller prior to the Closing as 
     contemplated in Section 5.13;

          (ii) the prosecution of the FIRREA Claim in accordance with the
     directions of the Seller on the condition that the Purchaser strictly 
     complies with the Seller's instructions in accordance with the standards 
     contained in Section 5.09;

          (iii) any fraudulent activity of employees of the Seller not 
     disclosed to the Purchaser in the Seller Disclosure Schedule (or otherwise 
     in writing) that is not otherwise covered by insurance (but subject to any 
     deductibles applicable thereto); and

          (iv) any breach of the representations and warranties contained in
     Sections 3.02, 3.03, 3.04, 3.05, 3.11 and 3.17 (subject, in the case of 
     Section 3.17 only, to the knowledge qualifiers set forth therein but, 
     excluding, for purposes of this Section 10.03, any Material Adverse 
     Effect qualifier contained in Section 3.17, and in the case of Section 
     3.10 certain clauses thereof, consisting solely of (A) clause (b)(i) to 
     the extent relating to fixed assets, (B) clause (b)(ii) to the extent
     relating to Encumbrances on Real Property but, for the avoidance of doubt,
     excluding any other properties or assets and (C) clauses (b)(iii), 
     (b)(iv), (b)(v), (b)(vi), (b)(ix) and (b)(x).

          (b)  Notwithstanding anything in the Agreement to the contrary, the
obligation of the Seller to indemnify the Purchaser shall be subject to the 
following limitations:

          (i)  for purposes of calculating the amount of any Loss (A) in the 
     case of a Loss arising out of or in connection with a claim asserted by 
     a third party against the Purchaser, a Loss shall not be required to be 
     indemnified hereunder until the earlier of (x) such time as the Purchaser 
     is required by judicial action or otherwise to pay the Loss (or any 
     portion thereof) to such third party or (y) a liability is conclusively 
     established rather than when payment is claimed by such third party, (B) 
     in the case of any other Loss, such Loss shall not be required to be 
     indemnified hereunder until such time as liability is reasonably 
     demonstrated by the Purchaser to the Seller rather than when payment is 
     claimed by the Purchaser except as otherwise provided for in paragraph 
     (e) of this Section 10.03, and (C) the amount of a Loss shall be reduced 
     by:

               (1)  the amount of the reserve (if any) of such Loss or category 
          of Loss in the Company's financial statements, as the case may be, 
          but any such reserved Losses shall not be included in the Claim 
          Deductible (as defined below); 

               (2)  the financial effect of any Tax benefit obtainable as a 
          result of the recognition of such Loss as contemplated in paragraph 
          (c) below;  

               (3)  the amount of any insurance proceeds and any indemnity,
          contribution or other similar payment in fact recoverable by the 
          Purchaser or any Affiliate from any third party with respect thereto; 
          and

               (4)  the amount of any Loss that results from or arises out of
          actions taken by the Purchaser, the Company or their respective 
          Affiliates after the Closing Date (other than with respect to the 
          defense or settlement of claims relating to periods prior to the 
          Closing Date);

     it being understood and agreed that the Purchaser shall take, and following
     the Closing shall cause the Company to take, all reasonable steps to 
     mitigate their Losses upon and after becoming aware of any event which 
     could reasonably be expected to give rise to any Losses;

          (ii) the indemnification obligations of the Seller pursuant to this
     Section 10.03 shall not be effective with respect to any Loss, as the case 
     may be, unless (x) in the case of any Loss associated with any matter 
     described in clause (a)(i) or (a)(ii) above, the amount of each such Loss 
     exceeds U.S.$1,000, (y) in the case of any Loss arising out of a breach 
     of the representation and warranty in Section 3.02, the amount of each 
     such Loss exceeds U.S.$10,000 and (z) in the case of any Loss arising 
     out of clause (a)(iii) above or a breach of the representations and 
     warranties listed in clause (a)(iv) above (other than as relates to a 
     breach of Section 3.02 but subject, in the case of other referenced 
     sections, to the limitations contained herein), the amount of each such 
     Loss exceeds U.S.$2,500,000 (each, a "Claim Deductible"), it being 
     understood and agreed that only the amount of any such Loss that exceeds 
     the Claim Deductible shall be covered by the indemnity covered in this 
     Section 10.03 and shall be referred to herein as the "Indemnifiable 
     Amount" with respect to such Loss; and

          (iii)     the maximum aggregate payment that the Seller shall be 
     liable to pay out under this Section 10.03 in respect of any Loss or all 
     Losses (other than in respect of any Loss arising out of the matters set 
     forth in clauses (a)(i) and (a)(ii) above) in the aggregate whether in 
     respect of the Indemnified Amounts or otherwise shall be U.S.$60,000,000 
     (the "Maximum Aggregate Indemnity Payment Amount").

          (c)   The amount of any Tax benefit shall be computed at the maximum
applicable marginal statutory tax rate in effect at the time of computation.  
Tax benefits determined to be substantially likely to be realized not later 
than the taxable year during which an indemnity payment is determined to be 
due shall be considered to be realized currently for purposes of netting 
against such indemnity payment hereunder.  If a payment is made by the Seller 
in accordance with this Section 10.03, and if in a subsequent taxable year 
an actual Tax benefit is realized by the Purchaser, CTUS, the Company, any 
Subsidiary or any of their Affiliates (that was not previously taken into 
account to reduce an amount otherwise payable by the Seller under Section 
10.03), the Purchaser, CTUS, the Company, any such Subsidiary or any such 
Affiliate shall pay to the Seller at the time of such realization the amount 
of such Tax benefit to the extent that the Tax benefit would have resulted in 
a reduction in the amount paid by the Seller under this Section 10.03 if the 
Tax benefit had been obtained in the year of such payment.  Subject to the 
foregoing, a Tax benefit will be considered to be realized for purposes of 
this Section 10.03 at the time that it is reflected in a Tax Return of the
Purchaser, CTUS, the Company, any Subsidiary or any of their Affiliates. 

          (d)  For purposes of determining the Seller's liability under this 
Section 10.03, the Purchaser shall have the right initially to undertake the 
defense, appeal or settlement of any claim, assertion, event or proceeding for 
which indemnity is provided for hereunder; provided, however, that (i) prior to 
the Purchaser undertaking the defense, appeal or settlement of any claim, 
assertion, event or proceeding for which indemnity may be available pursuant 
hereto the Seller shall have the right to undertake such defense, appeal or
settlement at its own cost and expense and, if the Seller shall not have 
undertaken any such defense, appeal or settlement, Seller shall have the right 
to consult, through counsel of its own choosing, on such defense, appeal or 
settlement negotiations at its own expense and (ii) in the event that, prior 
to or following the undertaking by the Purchaser of the defense, appeal or 
settlement of any claim, assertion, event or proceeding for which indemnity 
may be available pursuant hereto, the Seller determines that the defense, 
appeal or settlement of a third party claim by the Purchaser is likely to 
result in an increase in the Seller's liability under the indemnity provided 
for herein, then the Seller shall be entitled to undertake the  defense, appeal,
prosecution  or settlement negotiations at its own cost and expense.  All legal 
fees and expenses regarding the defense of any claim, assertion, event or 
proceeding by or in respect of a third party as to which the Purchaser may 
request indemnification shall be includable in the definition of "Loss" 
contained herein subject to the limitation on the Maximum Aggregate Indemnity 
Payment Amount set forth herein, it being understood and agreed, however, 
that (i) the Seller shall fully reimburse the Purchaser and/or its
subsidiaries for legal fees and expenses incurred in retaining counsel to 
provide assistance in connection with the prosecution by Marine Midland Bank 
of the FIRREA Claim, in accordance with the requirements of Section 5.09, so 
long as the Seller shall have approved in advance the selection and retention 
of such counsel and (ii) the Seller shall fully reimburse the Purchaser and/or 
its subsidiaries for reasonable legal fees and expenses incurred in connection 
with any litigation relating to the Minority Shares not acquired by the Seller 
prior to the Closing.

          (e)  In no event shall the Purchaser settle any claim or demand (or 
part thereof) for which indemnification may be sought hereunder without the 
prior written consent of the Seller (which consent shall not be unreasonably 
withheld and which shall be deemed to have been given absent a response 
within 10 Business Days from the date of receipt by the Seller of the relevant 
notice), and the Seller shall not, without the prior written consent of the 
Purchaser (which shall not be unreasonably withheld and which shall be deemed 
to have been given absent a response within 10 Business Days from the date of 
receipt by the Purchaser of the relevant notice), effect any settlement of any
pending or threatened proceeding in respect of which the Purchaser is or could 
have been a party and indemnity could have been sought hereunder by the 
Purchaser unless (i) such proceeding involves only monetary claims and (ii) the 
settlement includes an unconditional release of the Purchaser from all liability
in respect of such claims.

          (f)  In the event the Seller shall make a payment hereunder, the 
Seller shall be deemed to be subrogated fully to the rights of the Purchaser 
against any and all third parties.

          (g)  Except as set forth in this Agreement, the Seller is not making 
any representation, warranty, covenant or agreement with respect to the matters 
contained herein.  Anything herein to the contrary notwithstanding, no breach 
of any representation, warranty, covenant or agreement contained herein shall 
give rise to any right on the part of the Purchaser, after the consummation 
of the purchase and sale of the CTUS Shares and the Minority Shares 
contemplated hereby, to rescind this Agreement or any of the transactions 
contemplated hereby and the Purchaser hereby acknowledges and agrees that, 
as contemplated in Section 10.01, from and after the Closing, its sole and 
exclusive remedy with respect to any and all claims relating to or arising 
out of this Agreement shall be pursuant to the indemnification provisions set
forth in this Section 10.03.  In furtherance of the foregoing, the Purchaser 
hereby waives, from and after the Closing, to the fullest extent permitted 
under applicable Law, any and all other rights, claims and causes of action 
it (or, after the Closing, any Company) may have against the Seller or its 
officers, directors, employees, agents, representatives and Affiliates 
relating to the subject matter of this Agreement; provided, however, that,
except as otherwise contemplated in Section 9.04, the foregoing waiver shall 
not preclude legal action by the Purchaser for knowing misrepresentation by 
the Seller or willful noncompliance by the Seller with the terms of this 
Agreement.

          SECTION 10.04.  Prior Tax Sharing Agreements.  This Agreement
terminates and supersedes any and all other tax sharing or allocation agreements
in effect on the date hereof as between the Seller or any predecessor or 
Affiliate (other than an identified Affiliate for which CTUS is a common parent 
corporation) thereof on the one hand, and CTUS, the Company and any of the 
Subsidiaries on the other hand, for all taxes imposed by any federal, state, 
foreign or local government or taxing authority, regardless of the Period 
for which such taxes are imposed.

          SECTION 10.05.  Expenses.  Except as otherwise provided in Sections 
2.04, 5.03(b), 5.09, 5.12, 5.13, 7.03(b) and 7.06, all costs and expenses, 
including, without limitation, fees and disbursements of counsel, financial 
advisors and accountants, incurred in connection with this Agreement and the 
transactions contemplated hereby shall be paid by the party incurring such 
costs and expenses, whether or not the Closing shall have occurred.

          SECTION 10.06.  Federal Home Loan Bank of New York Advances. 
Notwithstanding anything herein to the contrary, it is understood and agreed 
by the Seller and Purchaser that solely with respect to any of the advances 
to, or maintained by, the Company on the Closing Date from the Federal Home 
Loan Bank of New York, the Purchaser shall pay and be responsible for any 
fees and expenses of any kind or nature, arising out of or resulting from the 
consummation of the transactions contemplated by this Agreement or any 
repayment or prepayment or change in any of the terms of any such advances 
and such fees and expenses shall not be used in any adjustment pursuant to 
Section 2.04, Section 2.05 or otherwise or in any way become payable or 
suffered in any way by the Seller or the Company.   

          SECTION 10.07.  Notices.  All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be given or made 
(and shall be deemed to have been duly given or made upon receipt) by delivery 
in person, by courier service, by cable, by telecopy, by telegram, by telex or 
by registered or certified mail (postage prepaid, return receipt requested) to 
the parties at the following addresses (or at such other address for a party 
as shall be specified by like notice):

          (a)  if to the Seller:

               CT Financial Services Inc.
               Canada Trust Tower
               161 Bay Street, 35th Floor
               Toronto, Ontario M5J 2T2
               Attention:     Diane E. Walker, Esq.
                       Senior Vice President,
                       Law & Governmental Relations
               Telecopy:  (416) 361-5465

               with a copy to:

               Shearman & Sterling
               599 Lexington Avenue
               New York, New York  10022
               Attention:  Stuart K. Fleischmann, Esq.
               Telecopy:  (212) 848-7179

          (b)  if to the Purchaser:

               One Marine Midland Center
               24th Floor
               Buffalo, New York  14203
               Attention:  Philip S. Toohey, Esq.
                       General Counsel and Secretary
               Telecopy:  (716) 841-5391

               with a copy to:

               Cleary, Gottlieb, Steen & Hamilton
               One Liberty Plaza
               New York, New York  10006
               Attention:  James F. Munsell, Esq.
               Telecopy:  (212) 225-3999

          SECTION 10.08.  Public Announcements.  Unless otherwise required by
stock exchanges, regulatory agencies or under any Law, no party to this 
Agreement shall make any public announcements in respect of this Agreement or 
the transactions contemplated herein or otherwise communicate with any news 
media without prior notification to the other party, and the parties shall 
cooperate as to the timing and contents of any such announcement.

          SECTION 10.09.  Headings.  The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

          SECTION 10.10.  Severability.  If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of 
Law or public policy, all other conditions and provisions of this Agreement 
shall nevertheless remain in full force and effect so long as the economic or 
legal substance of the transactions contemplated hereby is not affected in any 
manner materially adverse to any party.  Upon such determination that any 
term or other provision is invalid, illegal or incapable of being enforced, 
the parties hereto shall negotiate in good faith to modify this Agreement so 
as to effect the original intent of the parties as closely as possible in a
mutually acceptable manner in order that the transactions contemplated hereby be
consummated as originally contemplated to the greatest extent possible.

          SECTION 10.11.  Disclosure Schedule.  Disclosure of information by the
Seller in any portion of the Seller Disclosure Schedule, and disclosure of 
information by the Purchaser in any portion of the Purchaser Disclosure 
Schedule, shall be deemed disclosure in any other portion of the Seller 
Disclosure Schedule or the Purchaser Disclosure Schedule, as the case may be.

          SECTION 10.12.  Entire Agreement.  This Agreement constitutes the
entire agreement of the parties hereto with respect to the subject matter 
hereof and supersedes all prior agreements and undertakings, both written and 
oral, other than the Confidentiality Agreement between the Seller and the 
Purchaser with respect to the subject matter hereof and except as otherwise 
expressly provided herein.

          SECTION 10.13.  Assignment.  This Agreement may not be assigned by
either party hereto without the consent of the other party hereto (whether by 
operation of law or otherwise unless specifically provided herein); provided, 
however, that the Seller may transfer or assign any or all of its CTUS Shares 
and/or any or all of its rights and obligations under this Agreement, in whole 
or in part, to Imasco Limited or any direct or indirect subsidiary of Imasco 
Limited or the Seller so long as (i) CT Financial Services Inc., shall remain 
liable for all of such assignee's obligations under this Agreement and (ii) 
the representations and warranties made at Closing shall be deemed to have 
been made by CT Financial Services Inc. except that, to the extent the CTUS
Shares are assigned to any assignee, the first sentence of Section 3.04 shall 
be revised to reflect the transfer of record and beneficial ownership to such 
assignee, and Section 5.11 which, for the avoidance of doubt, shall only be 
a covenant of CT Financial Services, Inc. and by no other Person, including 
any permitted assignee as contemplated herein.

          SECTION 10.14.  No Third-Party Beneficiaries.  Except as provided in
Article VII and Sections 5.02(a) and 10.02, this Agreement is for the sole 
benefit of the parties hereto and their permitted assigns and nothing herein, 
express or implied, is intended to or shall confer upon any other person or 
entity any legal or equitable right, benefit or remedy of any nature whatsoever 
under or by reason of this Agreement.

          SECTION 10.15.  Amendment; Waiver.  This Agreement may not be
amended or modified except by an instrument in writing signed by the Seller 
and the Purchaser.  Waiver of any term or condition of this Agreement shall 
only be effective if in writing and shall not be construed as a waiver of any 
subsequent breach or a waiver of any other term or condition of this Agreement.

          SECTION 10.16.  Governing Law.  This Agreement shall be governed by,
and construed in accordance with, the Laws of New York applicable to contracts
executed in and to be performed in that State.  All actions and proceedings 
arising out of or relating to this Agreement shall be heard and determined in 
a New York state or federal court sitting in the Southern District of New York, 
and the parties hereto hereby irrevocably submit to the exclusive jurisdiction 
of such courts in any such action or proceeding and irrevocably waive the 
defense of an inconvenient forum to the maintenance of any such action or 
proceeding.

          SECTION 10.17.  Counterparts.  This Agreement may be executed in one
or more counterparts, and by the different parties hereto in separate 
counterparts, including via telecopier, each of which when executed shall be 
deemed to be an original but all of which taken together shall constitute one 
and the same agreement.



          IN WITNESS WHEREOF, the Seller and the Purchaser have caused this
Agreement to be executed as of the date first written above by their respective 
officers thereunto duly authorized.
                                   
               

                                   CT FINANCIAL SERVICES INC.


                                   By:   /s/  Edmund Clark                 


                                   By:   /s/  Paul Derksen                 



                                   HSBC AMERICAS, INC.


                                   By:   /s/  James H. Cleave              


                                   By:   /s/  Philip S. Toohey             





</TABLE>
<TABLE>
<CAPTION>
                                                          Exhibit 2.05(b)

Forecast of book value (of the Company) pursuant to stock purchase agreement

($ in millions)
                                       Projected   Accrual    Accrual Recapture   
                                            core       for        for        to             Estimated
                                             net estimated  estimated     def'd                  book
                                Actual    income     stock  severance       tax  Accrual of     value
                            book value        (5    option          &       val        SAIF        at
                               6/30/96    months)   payout incentives     allow  assessment   closing
<S>                             <C>       <C>       <C>          <C>        <C>       <C>      <C>
Total expected benefit 
 (obligation)                   $ 43.9    $(15.0)   $(18.0)      $5.0         -
Less:  current amounts 
        accrued                                       10.0 
Less:  amounts covered by 
        Marine                                                   16.0 
  Pre tax income (expense)                  43.9      (5.0)      (2.0)      5.0           -           
Taxes                                      (18.9)      2.2        0.9         -           - 
  Net Income                                25.0      (2.9)      (1.1)      5.0           -
Div to CT per sec 2.05 
 (<= $5.3 @ month)                         (25.0)
  Book value                    $448.0       0.0      (2.9)      (1.1)      5.0           -    $449.0
Adjustments to audited 
 book value per sec 2.05                               2.9        1.1         -           -
Pre closing payments/div 
 per sec 5.07                              (53.0) 
  "Audited" book value          $448.0     (53.0)        -          -       5.0           -    $400.0
Total dividends paid to CT                          Differential amount
                                          $ 78.0     Audited book value                        $400.0
                                                    Targeted book value               400.0          
                                                    Add: excess interim
                                                     earnings > $5.3 mm                   -     400.0
                                                    Differential: 
                                                     adjustment to      
                                                     purchase price                            $  0.0

</TABLE>



                                                             Exhibit 5.09(b)

                    Term Sheet for the Preferred Stock

Issuer:             CTUS 

Issue:              100 shares of Series A Preferred Stock, par value $.01
                    per share (the "Preferred Stock").

Ranking:            Will rank senior to the common stock of CTUS and any
                    preferred stock of CTUS or any successor-in-interest thereto
                    issued after the issuance of the Preferred Stock.

Annual Dividends:   None.

Special Dividends:  Payment made in an amount equal to the Preferred Stock
                    Dividend Amount on first Business Day following the later 
                    of (i) 90 days after the commencement of the FIRREA
                    Plaintiff's taxation year in which the FIRREA Plaintiff
                    receives the FIRREA Recovery and (ii) 30 days after 
                    receipt of the FIRREA Recovery by the FIRREA Plaintiff.

Redemption/
Cancellation:       Redemption at the option of the holder, following the
                    later of (i) the final determination, settlement or
                    compromise of the FIRREA Claim and (ii) the receipt
                    by the FIRREA Plaintiff of the FIRREA Recovery, if
                    any.  Redeemable at the option of the issuer 280 days
                    following the distribution of the Preferred Stock
                    Dividend Amount. 

Redemption Amount/
Liquidation Preference:       Preferred Stock Redemption Amount.

Voting Rights:      No voting rights, except as provided by law.  CTUS or any
                    successor-in-interest thereto shall not, without the vote 
                    of two-thirds of the outstanding shares of the Preferred 
                    Stock, (a) amend, alter, repeal or waive compliance with 
                    any provision of the Certificate of Incorporation of CTUS 
                    or any successor-in-interest thereto so as to affect 
                    adversely the specified rights, preferences, privileges 
                    or voting rights of the Preferred Stock, (b) authorize 
                    the issuance of any additional shares of Preferred Stock 
                    or any securities senior to the Preferred Stock or 
                    (c) effect any reclassification of the Preferred Stock.

Other Rights:       The holder(s) of the Preferred Stock shall have the right
                    to direct the FIRREA Claim and shall have sufficient
                    protection to maintain their rights in the FIRREA Claim
                    in the event that the Company (or any successor-in-
                    interest) is not a wholly-owned subsidiary or CTUS (or
                    any successor-in-interest).

Transferability:    Within Imasco/BAT family and otherwise with the
                    Purchaser's consent.




                                                             Exhibit 5.09(e)

                           STANDARDS OF CONDUCT
                           FOR FIRREA PLAINTIFF

          (a)  the FIRREA Plaintiff may rely and shall be protected in acting 
  or refraining from acting upon any resolution, certificate, statement, 
  instrument, opinion, report, notice, request, direction, consent, order or 
  other paper or document believed by it to be genuine and to have been signed 
  or presented by the Seller;

          (b)  any request or direction of the Seller pursuant to Section 5.09 
  of the Agreement shall be sufficiently evidenced by a Seller request or order 
  which appears on its face to have been signed by an executive officer of the 
  Seller and any resolution of the Board of Directors of the Seller may be 
  sufficiently evidenced by a board resolution of the Seller certified by its 
  secretary or an assistant secretary;

          (c)  whenever the FIRREA Plaintiff shall deem it desirable that a
  matter be proved or established prior to taking, suffering or omitting any 
  action hereunder, the FIRREA Plaintiff (unless other evidence be herein 
  specifically prescribed) may, in the absence of bad faith on its part, rely 
  upon a board resolution, an opinion of counsel or an officers' certificate 
  of the Seller;

          (d)  the FIRREA Plaintiff shall not be bound to make any 
  investigation into the facts or matters stated in any resolution, 
  certificate, statement, instrument, opinion, report, notice, request, 
  direction, consent, order or other paper or document, but the FIRREA 
  Plaintiff, in its discretion, may make such further inquiry or investigation 
  into such facts or matters as it may see fit;

          (e)  the FIRREA Plaintiff may execute any of the powers provided  
  for in Section 5.09(c) of the Agreement or perform any duties thereunder 
  either directly or by or through agents, attorneys, custodians or nominees 
  and the FIRREA Plaintiff shall not be responsible for the supervision of or 
  any misconduct or negligence on the part of any such agent, attorney, 
  custodian or nominee appointed with due care by it hereunder; 

          (f)  the FIRREA Plaintiff shall not be liable for any action taken,
  suffered or omitted by it in good faith and believed by it to be authorized 
  or within the discretion or rights or powers conferred upon it by Section 
  5.09(c) of the Agreement;

          (g)  The FIRREA Plaintiff shall not be required to expend or risk 
  its own funds or otherwise incur any financial liability in the performance 
  of any of it duties set forth in Section 5.09(c) of the Agreement, or in 
  the exercise of any of its rights or powers, if it shall have reasonable 
  grounds for believing that repayment of such funds or adequate indemnity 
  against such risk or liability is not reasonably assured to it;

          (h)  The FIRREA Plaintiff shall not be required to expose itself to
  criminal liability or punitive damages in the performance of any of its 
  obligations under Section 5.09 of the Agreement.






                                                            Exhibit 5.14(c)

                                    
               
                                    
                                    
                                    
                                    
                                    
                  PROPOSED FORM OF BANK PLAN OF MERGER
                                    
                                    
                                 BETWEEN
                                    
                           MARINE MIDLAND BANK
                                    
                                   AND
                                    
         FIRST FEDERAL SAVINGS AND LOAN ASSOCIATION OF ROCHESTER
                                    
                                    
                  DATED                         , 1996










           BANK PLAN OF MERGER dated ______________________, 1996 (the
"Agreement"), between MARINE MIDLAND BANK ("Marine"), a New York banking
corporation and a subsidiary of HSBC AMERICAS, INC. ("HZ"), and FIRST
FEDERAL SAVINGS AND LOAN ASSOCIATION OF ROCHESTER ("First
Federal"), a federal savings and loan association and a subsidiary of CTUS, 
Inc. ("CTUS").


                             Recitals

                                   
          A.   The Boards of Directors of HZ and CTUS have approved, and
deem it advisable and in the best interests of their shareholders to 
consummate, the business combination transaction set forth in the Stock 
Purchase Agreement and Plan of Merger, dated as of August 21, 1996, between 
HZ, MM Merger Corporation, a wholly owned subsidiary of HZ (the "Merger 
Subsidiary"), and CT Financial Services, Inc. (the "Parent Merger Agreement") 
pursuant to which the Merger Subsidiary would merge with and into CTUS (the 
"Parent Merger").

          B.   The Boards of Directors of Marine and First Federal, and HZ 
and CTUS as the sole shareholders of Marine and First Federal, have approved 
and deem it advisable to consummate the business combination transaction 
provided for in this Agreement, pursuant to which First Federal would merge
with and into Marine (the "Bank Merger"), subject to and as soon as 
practicable after consummation of the Parent Merger.


                              Agreement
   
                              
                              ARTICLE I
                          
                              The Merger
                         

          1.1  Effective Time of Bank Merger.  The Bank Merger shall become
effective on the filing of this Agreement (the "Plan of Merger") in the 
office of the Superintendent of Banks of the State of New York as provided 
in Section 601-b of the New York Banking Law and upon the filing of Articles 
of Combination with the Office of Thrift Supervision ("OTS") and the 
endorsement of the Articles of Combination by the OTS in accordance with 
12 C.F.R. Section 552.13(j) (the "Effective Time").  After the filing of the 
Plan of Merger in the Superintendent's office and the filing of the Articles 
of Combination with the OTS, the Surviving Bank (as defined in Section 1.2) 
shall cause the Plan of Merger to be filed in the office of the Clerk of 
Erie County.  

          1.2  Effects of Merger.

          (a)  At the Effective Time (i) the separate existence of First 
Federal shall cease, and First Federal shall be merged with and into Marine 
(Marine and First Federal being sometimes referred to as the "Constituent 
Banks" and Marine being sometimes referred to as the "Surviving Bank"); and 
(ii) the Organization Certificate of Marine as in effect immediately prior 
to the Effective Time shall be the Organization Certificate of the Surviving 
Bank, and the name of the Surviving Bank shall be "Marine Midland Bank"; 
and (iii) the By-Laws of Marine in effect immediately prior to the Effective 
Time shall be the By-Laws of the Surviving Bank.

          (b)  At and after the Effective Time, the Bank Merger shall have 
all the effects set forth in Section 602 of the New York Banking Law; the 
separate existence of First Federal shall cease; and all of the property, 
rights, powers, duties and obligations of First Federal and Marine shall 
be taken by and deemed to be transferred to and vested in the Surviving 
Bank without further act or deed. 

          1.3  Headquarters; Offices.  The headquarters and principal office 
of the Surviving Bank shall be at One Marine Midland Center, Buffalo, 
New York.  The branch offices of Marine shall remain the branch offices of 
the Surviving Bank, and First Federal's principal office at One First 
Federal Plaza, Rochester, New York, and its branch offices shall become 
branch offices of the Surviving Bank.

          1.4  Directors and Officers.  From and after the Effective Time, 
the directors of the Surviving Bank shall be the directors of Marine in 
office immediately before the Effective Time.  The officers of the Surviving 
Bank shall be the officers of Marine in office immediately before the 
Effective Time.


                                ARTICLE II

               Effect on Capital Stock of Constituent Banks


          2.1  Effect on First Federal Stock.  At the Effective Time, by 
virtue of the Bank Merger and without any action on the part of the holder 
of the shares of the common stock, par value $           per share, of 
First Federal ("First Federal Common Stock"):

          (a)  Cancellation of Treasury Stock.  All shares of First Federal
Common Stock owned by First Federal as treasury stock shall be cancelled and 
retired and shall cease to exist, and all rights in respect of such shares 
shall cease.

          (b)  Cancellation of Issued and Outstanding Common Stock.  All 
shares of First Federal Common Stock issued and outstanding immediately prior 
to the Effective Time shall be deemed cancelled and retired and shall cease to 
exist, and all rights in respect of such shares shall cease.

          2.2  Effect on Marine Stock.  At the Effective Time, by virtue of 
the Bank Merger and without any action on the part of the holder of the shares 
of common stock, par value $100.00 per share, of Marine (the "Marine Common 
Stock"), each share of the Marine Common Stock issued and outstanding 
immediately prior to the Effective Time shall be converted into one issued 
and outstanding share of the Surviving Bank, and the holder of the Marine 
Common Stock shall automatically become the holder of the issued and 
outstanding shares of the Surviving Bank. 


                                ARTICLE III

                           Conditions Precedent


          3.1  Conditions to Each Party's Obligations.  The obligations of each
party to effect the Bank Merger shall be subject to the satisfaction of the 
following conditions before the Closing Date (as defined in the Parent Merger 
Agreement):

          (a)  Parent Merger.  The Parent Merger shall have occurred.

          (b)  No Injunctions or Restraints; Illegality.  No temporary 
restraining order, preliminary or permanent injunction or other order issued 
by any court of competent jurisdiction or any other legal restraint or 
prohibition ("Injunction") preventing the consummation of the Bank Merger 
shall be in effect.  There shall not have been any action taken or any 
statute, rule or other regulation enacted, entered, enforced or deemed 
applicable to the Bank Merger that makes the consummation of the Bank Merger 
illegal.

          (c)  Other Approvals.  All regulatory and stockholder approvals 
required in the Parent Merger Agreement shall have been obtained and continue 
to be in full force and effect, and CTUS, as the sole stockholder of First 
Federal, shall have approved the Bank Merger.


                                ARTICLE IV

                               Miscellaneous


          4.1  Termination.  This Agreement shall be deemed terminated if the
Parent Merger Agreement is terminated pursuant to Section 9.01 thereof, and
termination of this Agreement shall have the same effects as those set forth 
in Section 9.02 of the Parent Merger Agreement with respect to the termination 
of the Parent Merger Agreement.

          4.2  Amendment.  This Agreement may be amended only by a written
agreement signed by the parties, and any amendment shall be subject to any 
required regulatory agency approval.  An extension of time to perform any 
obligation under this Agreement or a waiver of any breach or requirement 
of this Agreement shall be effective only if it is set forth in a writing 
signed by the party against whom it is sought to be enforced.

          4.3  Captions.  The subject headings of this Agreement are included 
for convenience only and shall not affect the construction or interpretation 
of this Agreement.

          4.4  Definitions.  Capitalized terms not otherwise defined in this
Agreement shall have the meanings for such terms that are set forth in the 
Parent Merger Agreement.

          4.5  Survival.  Each representation, warranty and covenant set forth 
in this Agreement shall terminate as of the Closing Date.

          4.6  Counterparts.  This Agreement may be executed in any number of
counterparts.  Each counterpart shall constitute an original instrument, but all
counterparts shall constitute one and the same instrument.

          4.7  Governing Law.  Except to the extent governed by federal law, the
validity, construction and enforceability of this Agreement shall be governed 
by the internal laws of the State of New York without reference to conflicts 
of law principles.

          Marine and First Federal have caused this Agreement to be executed 
by their duly authorized officers and their corporate seals to be affixed as 
of the date first written above.

                                   MARINE MIDLAND BANK

[SEAL]
                                   By                       


                                   FIRST FEDERAL SAVINGS AND
                                   LOAN ASSOCIATION OF
                                   ROCHESTER

[SEAL]
                                   By                       





                                                      Exhibit 13




                           CTUS AND SUBSIDIARIES

                    Consolidated Financial Statements

                        December 31, 1995 and 1994
 
               (With Independent Auditors' Report Thereon)




Peat Marwick LLP
600 Clinton Square  
Telephone 716 454 1644 Telefax 716 454 1469
Rochester, NY 14604



                      Independent Auditors' Report


The Shareholder and Board of Directors of CTUS:



We have audited the accompanying consolidated statements of
financial condition of CTUS and subsidiaries as of December 31,
1995 and 1994, and the related consolidated statements of income,
changes in stockholder's equity, and cash flows for the years
then ended. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is
to express an opinion on these consolidated financial statements
based on our audits.

We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial
position of CTUS and subsidiaries as of December 31, 1995 and
1994, and results of their operations and their cash flows for
the years then ended in conformity with generally accepted
accounting principles.

As discussed in note 1 to the consolidated financial statements, 
the Company adopted the provisions of Statement of Financial 
Accounting Standards (SFAS) No. 114, Accounting for Impairment of 
a Loan, as amended by SFAS No. 118, Accounting by Creditors for 
Impairment of a Loan - Income Recognition and Disclosures, on 
January 1, 1995, and SFAS No. 115, Accounting for Certain 
Investments in Debt and Equity Securities, on January 1, 1994.


                         /s/ KPMG Peat Marwick LLP

January 12, 1996



<TABLE>
<CAPTION>

                             CTUS AND SUBSIDIARIES
                 Consolidated Statements of Financial Condition
                           December 31, 1995 and 1994
                   (amounts in thousands except share amounts)




                                                   1995        1994 
     Assets
<S>                                          <C>         <C> 
Cash and cash equivalents                    $  227,185  $  215,363 
Securities available for sale, 
 at fair value                                  629,395      65,763      
Securities held to maturity                     300,460   1,159,538 
Loans                                         5,777,051   4,955,678 
  Allowance for loan losses                      38,842      35,373 
  Net loans                                   5,738,209   4,920,305 
 
Federal Home Loan Bank stock, at cost            85,838      75,625 
Accrued interest receivable                      44,291      37,783 
Premises and equipment, net                      56,785      56,213 
Cost of loan servicing rights acquired           59,018      29,062      
Excess loan servicing fees capitalized           15,095      17,231 
Other assets                                     40,444      38,780 
     Total assets                            $7,196,720  $6,615,663 


     Liabilities and Stockholder's Equity

Liabilities:
  Deposits                                   $4,210,502  $4,031,197 
  Advances from Federal Home Loan Bank        1,710,955   1,504,874 
  Securities sold under agreements to
   repurchase                                   570,648     498,077 
  Collateralized mortgage obligations             8,531       9,918 
  Senior and subordinated debt                   82,000      53,000      
  Advances from borrowers for taxes and
   insurance                                    125,799     111,411 
  Accrued interest payable                       47,566      25,746 
  Other liabilities                             126,861     112,495 
  Minority interest in subsidiary                 2,710       2,469 
     Total liabilities                        6,885,572   6,349,187 

Stockholder's Equity
  Common stock, $.01 par value, 10,000 
   shares authorized, 100 shares issued 
   and outstanding                                    -           - 
  Additional paid in capital                    163,000     163,000 
  Retained earnings                             146,714     104,506 
  Unrealized gain (loss) on securities
   available for sale, net of taxes               1,434      (1,030)     

     Total stockholder's equity                 311,148     266,476 

     Total liabilities and 
      stockholder's equity                   $7,196,720  $6,615,663 



See accompanying notes to consolidated financial statements.


</TABLE>


<TABLE>
<CAPTION>

                         CTUS AND SUBSIDIARIES
        Consolidated Statement of Changes in Stockholder's Equity
                Years Ended December 31, 1995 and 1994
                        (amounts in thousands)



                              Common Stock            Net unrealized
                                       and             Gain(Loss) on
                                Additional                Securities
                                      Paid  Retained       Available
                                in Capital  Earnings        for Sale     Total  
                                                                                
<S>                               <C>        <C>            <C>       <C>   
Balance, December 31, 1993        $163,000   $72,418        $     -   $235,418 

Net income, 1994                         -    32,088              -     32,088 

Net unrealized loss
 on securities available
 for sale, net of tax
 effect of $776                          -         -         (1,030)    (1,030) 


Balance, December 31, 1994         163,000   104,506         (1,030)   266,476 

Net income, 1995                         -    42,208              -     42,208 

Net change in unrealized 
 gain (loss) on securities 
 available for sale, net of 
 tax effect of $1,858                    -         -          2,464      2,464 

Balance, December 31, 1995        $163,000  $146,714        $ 1,434   $311,148 





See accompanying notes to consolidated financial statements.

</TABLE>




<TABLE>
<CAPTION>

                              CTUS AND SUBSIDIARIES
                        Consolidated Statements of Income
                     Years Ended December 31, 1995 and 1994
                             (amounts in thousands)


                                                 1995        1994 
<S>                                          <C>         <C>
Interest income:                                                                   
  Loans - interest and fees                  $396,178    $306,177            
  Securities                                   67,492      70,462 
  Cash equivalents                              7,569       7,715 
  Other                                         9,964       9,848 
     Total interest income                    481,203     394,202 

Interest expense:
  Deposits                                    172,177     132,521 
  Federal Home Loan Bank advances             100,183      76,793 
  Securities sold under agreements
   to repurchase                               33,181      16,747 
  Other borrowings                              9,330       7,052 
     Total interest expense                   314,871     233,113 

     Net interest income before provision     166,332     161,089 

Provision for loan and mortgage-backed
 security losses                               15,756      18,054 

     Net interest income after provision      150,576     143,035 


Other operating income:
  Loan fees                                     5,166       4,246 
  Loan servicing income, net                   11,376       9,741 
  Customer service fees                        14,685      13,439 
  Net gain (loss) on sale of mortgage loans
   and securities                               6,194        (433)
  Other                                         5,939       5,196 
     Total other operating income              43,360      32,189 


Other operating expenses:
  Employee compensation and benefits           59,206      55,687 
  Office occupancy and equipment               23,048      20,256 
  General and administrative                   25,520      27,763 
  Marketing                                     3,800       4,033 
  Deposit insurance premiums                   10,831      10,734 
     Total other operating expenses           122,405     118,473 

Minority interest in net income of 
 subsidiary                                       280         252 

  Income before taxes                          71,251      56,499 

  Income taxes                                 29,043      24,411 


  Net income                                 $ 42,208    $ 32,088 



See accompanying notes to consolidated financial statements.

</TABLE>


<TABLE>
<CAPTION>

                    CTUS AND SUBSIDIARIES
             Consolidated Statements of Cash Flows
             Years Ended December 31, 1995 and 1994
                     (amounts in thousands)


                                                1995         1994 
<S>                                      <C>            <C>
Cash flows from operating activities:
  Net income                             $    42,208    $  32,088 
  Adjustments to reconcile net income 
   to net cash provided by operating 
   activities:
     Depreciation, amortization and 
      accretion                               22,325       20,491 
     Provision for loan and mortgage-
      backed security losses                  15,756       18,054 
     Deferred income taxes                    (4,991)      11,076 
     Net (gain) loss on sale of mortgage 
      loans and securities                    (6,194)         433 
     Loan fees and discounts deferred - net  (13,710)      (8,295)
     Decrease(Increase) in mortgage loans 
      held for sale - net                    (77,920)     105,865 
     Net change in:
        Other assets and accrued interest 
          receivable                          (8,172)       2,884 
        Other liabilities and accrued 
         interest payable                     41,178      (65,614)
        Other items                              788       (3,420)
        Net Cash provided by operating 
         activities                           11,268      113,562 

Cash flows from investing activities:
  Proceeds from sales of portfolio loans      84,665       59,348 
  Proceeds from sales of securities 
   available for sale                        143,028      160,634 
  Principal payments of loans for 
   portfolio                                 835,279      803,849 
  Investments in loans                    (1,659,142)  (1,676,813)
  Purchases of securities available 
   for sale                                  (49,000)     (13,688)
  Purchases of securities held to 
    maturity                                 (20,000)    (168,145)
  Increase in servicing rights               (36,132)     (16,594)
  Purchase of FHLB stock, net                (10,213)      (3,635)
  Purchases of premises and 
    equipment, net                           (10,311)     (10,744)
  Proceeds from maturities of and 
    principal collected on securities        224,250      332,408 
     Net cash used by investing 
      activities                            (497,576)    (533,380)

Cash flows from financing activities:
  Deposit acquisitions                             -       25,065 
  Increase in deposits                       179,305       77,490 
  Proceeds from FHLB advances              2,242,489    1,985,180 
  Payments on FHLB advances               (2,038,236)  (1,882,000)
  Increase in securities sold under 
   agreement to repurchase                    72,571      199,391 
  Increase in subordinated debt               29,000            - 
  Net increase (decrease) in advances 
   from borrowers for taxes and insurance     14,388          (56)
  Decrease in collateralized mortgage 
   obligations                                (1,387)      (2,634)
Net cash provided by financing 
 activities                                  498,130      402,436 
  Net increase(decrease) in cash and 
   cash equivalents                           11,822      (17,382)
Cash and cash equivalents at 
 beginning of year                           215,363      232,745 
Cash and cash equivalents at 
 end of year                             $   227,185   $  215,363 

Supplemental disclosure of cash flow 
 information:
  Cash paid during the year for:
     Interest                            $   293,023   $  246,577 
     Income taxes                             22,595        9,795 

Non cash investing activities:
  Change in net unrealized gain (loss) 
   on securities available for sale      $     2,464   $    1,030 
  Transfer of foreclosed real estate          19,547       32,600 




See accompanying notes to consolidated financial statements.

</TABLE>
              



                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

                        December 31, 1995 and 1994



(1)  Summary of Significant Accounting Policies

     (a)  Basis of Presentation

          CTUS, a unitary thrift holding company (the "Company"), is the
          parent of First Federal Savings and Loan Association of Rochester
          and subsidiaries (the "Subsidiary") and is owned by CT Financial
          Services, Inc. (the "Parent") through a subsidiary of the parent,
          CT North America Financial Holdings.  

     (b)  Principles of Consolidation

          The consolidated financial statements include the accounts of the
          Company and its Subsidiary.  All significant intercompany accounts
          and transactions have been eliminated.

     (c)  Cash Equivalents

          Cash equivalents consist of federal funds sold, certificates of
          deposits and funds due from banks.  For purposes of the statements
          of cash flows, all highly liquid debt instruments with original
          maturities of three months or less are considered cash
          equivalents.

     (d)  Securities
     
          Effective January 1, 1994, the Company adopted the provisions of
          Statement of Financial Accounting Standards No. 115, Accounting
          for Certain Investments in Debt and Equity Securities.  The
          Statement requires classification of securities into three
          categories: trading, available for sale, or held to maturity.  The
          Company classifies its debt securities as either available for
          sale or held to maturity, as the Company does not hold any
          securities considered to be trading.

          Held to maturity securities are those that the Company has
          the positive intent and ability to hold to maturity.  All
          other securities not classified as held to maturity are
          classified as available for sale.

          Available for sale securities are recorded at fair value.  Held to
          maturity securities are recorded at cost, adjusted for the
          amortization or accretion of premiums or discounts.  Unrealized
          holding gains and losses, net of the related tax effect, on
          available for sale securities are excluded from earnings and are
          reported as a separate component of stockholder's equity until
          realized.  

          A decline in the fair value of any available for sale or held to
          maturity security below cost that is deemed other than temporary
          is charged to earnings resulting in the establishment of a new
          cost basis for the security.

          Interest income includes interest earned on the securities and the
          amortization of premiums and accretion of discounts of the related
          held to maturity securities as an adjustment to yield using the
          effective interest method.  Realized gains or losses on securities
          sold are recognized on the trade date using the specific
          identification method.




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements


(1)  Summary of Significant Accounting Policies

     (e)  Loans

          Loans are stated at the principal amount outstanding adjusted for
          unearned discounts, unamortized premiums and net deferred fees.
          Loan origination fees and certain direct origination costs are
          deferred and amortized over the contractual life of the related
          loans using the interest method.

     (f)  Mortgage Banking Activities

          Mortgage loans held for sale are recorded at the lower of
          aggregate cost or estimated market value.  Net unrealized losses
          are recognized through a valuation allowance by charges to
          earnings.

          Gains and losses on loan sales are recognized on trade date and
          are determined by the difference between net sales proceeds and
          the carrying value of the mortgage loans sold.  When servicing is
          retained, an additional gain or loss may be recognized based upon
          the net present value of expected amounts to be received or paid
          resulting from the difference between the contractual interest
          rates received from the borrowers and the rates paid to the buyers
          excluding a normal loan servicing fee, securitization fees and
          costs, and considering estimated prepayments on such loans.  The
          resulting excess loan interest income (excess loan servicing fees
          capitalized) is amortized over the estimated remaining life of the
          loans using the interest method.

          The cost of acquiring the right to service mortgage loans is
          capitalized and amortized in proportion to and over the period of
          estimated net servicing income based on the interest method.

          Fees related to the servicing of mortgage loans for the benefit of
          others are determined on the basis of loans serviced and are
          recorded as income when payments are received.

          Statement of Financial Accounting Standards No. 122, Accounting
          for Mortgage Servicing Rights, an amendment of FASB Statement No.
          65, was issued in May 1995.  The Statement requires mortgage
          banking enterprises to recognize as separate assets the rights to
          service mortgage loans for others, however those rights are
          acquired, eliminating the previously existing accounting
          distinction between servicing rights acquired through purchase
          transactions and those acquired through loan originations.  The
          provisions of the Statement will be applied prospectively
          beginning in fiscal 1996.  The expected impact to the financial
          statements in 1996 is not material.




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(1)  Summary of Significant Accounting Policies

     (g)  Allowance for Loan Losses
          
          The Company's provision for loan losses charged to operations is
          based upon management's evaluation of the loan portfolio.  The
          allowance for loan losses is maintained at an amount management
          deems adequate to provide for potential loan losses considering
          the character of the loan portfolio, economic conditions, analysis
          of specific loans and historical loss experience.  While
          management uses available information to recognize losses on
          loans, future additions to the allowance may be necessary based on
          changes in economic conditions.  In addition, various regulatory
          agencies, as an integral part of their examination process,
          periodically review the Company's allowances for loan losses. 
          Such agencies may require the Company to recognize additions to
          the allowance based on their judgements about information
          available to them at the time of their examination.

          The accrual of interest on impaired loans is discontinued when
          loans are contractually ninety days past due or in management's
          opinion, the borrower may be unable to meet payments as they
          become due.  When interest accrual is discontinued, all unpaid
          accrued interest is reversed.  Income is subsequently recognized
          only to the extent cash payments are received and the principal
          balance is expected to be recovered.  Such loans are restored to
          an accrual status only if the loan is brought contractually
          current and the borrower has demonstrated the ability to make
          future payments of principal and interest.

          The Company adopted the provisions of Statement of Financial
          Accounting Standards  No. 114, Accounting for Creditors for
          Impairment of a Loan as amended by FASB Statement No. 118,
          Accounting by Creditors for Impairment of a Loan - Income
          Recognition and Disclosures in 1995.  The Statement provides
          guidance in defining and measuring loan impairment.  A loan is
          considered impaired when, based on current information and events,
          it is probable that a creditor will be unable to collect all
          amounts of principal and interest under the original terms of the
          agreement.  Accordingly, the Company measures certain impaired
          commercial mortgage loans based on the present value of expected
          future cash flows, discounted at the loan's effective interest
          rate or, at the loan's observable market price or fair value of
          collateral.  The Statement does not apply to large groups of small
          balance, homogeneous loans that are collectively evaluated for
          impairment.  The Statement did not have a material impact on the
          Company's 1995 consolidated financial statements.

     (h)  Premises and Equipment

          Premises and equipment are recorded at acquired cost less
          accumulated depreciation.  Depreciation and amortization are
          calculated primarily using the straight-line method over the
          estimated useful lives of the depreciable asset.  The lives used
          to compute depreciation and amortization are 30 to 50 years for
          buildings, the lesser of the lease term or estimated useful life
          for leasehold improvements, and 5 to 10 years for equipment.




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(1)  Summary of Significant Accounting Policies

     (i)  Foreclosed Real Estate

          Foreclosed real estate represents property acquired through, or in
          lieu of, foreclosure.  At acquisition, foreclosed real estate is
          valued at the lower of fair value or the carrying amount,
          including related costs incurred to acquire the property at
          acquisition.  Subsequent to acquisition, foreclosed real estate is
          carried at the lower of the carrying amount or fair value less
          estimated costs to sell.  Foreclosed real estate is included in
          other assets.


     (j)  Financial Instruments

          The Company holds various derivative financial instruments to
          hedge exposure to fluctuating interest rates.  The Company is not
          an issuer of any financial instrument derivatives.

          Interest-Rate Exchange Agreements.  Interest-rate
          exchange agreements (swaps) used in asset/liability
          management activities are accounted for using the
          accrual method.  Net interest income  (expense)
          resulting from the differential between exchanging
          floating and fixed-rate interest payments is recorded
          on a current basis.  Gains or losses, if any, on
          terminated swaps used in asset/liability management
          activities are deferred and amortized into interest
          income or expense over the original maturity period of
          the swap.

          Interest Rate Caps.  Premiums paid  for interest  rate caps are
          capitalized and amortized  into  interest expense over the
          contractual terms of the cap.  Interest received  under  the 
          terms of  the caps is  accrued  and  recorded as a reduction of 
          interest expense.

          Options.  Option premiums paid are capitalized and amortized to
          income over the exercise period of the option, while realized
          gains on exercised options are deferred and amortized over the
          term of the expected benefit.

          Other Off-Balance-Sheet Instruments.  In the ordinary course of
          business the Company has entered into off-balance-sheet financial
          instruments consisting of commitments to extend credit and forward
          commitments to sell securitized loans.  Such financial instruments
          are recorded in the financial statements when they are funded or
          related fees are incurred or received.

          Although off-balance sheet derivative financial instruments do not
          expose the Company to credit risk equal to the notional amount,
          the Company is exposed to credit risk to the extent of the fair
          value gain of an off-balance sheet derivative financial instrument
          if the counterparty fails to perform.  The Company minimizes the
          credit risk in these instruments by dealing only with highly rated
          counterparties who have credit ratings of investment grade as
          rated by the major rating agencies.  Each transaction is
          specifically approved for applicable credit exposure.

     




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(1)  Summary of Significant Accounting Policies


     (k)  Securities Sold under Agreements to Repurchase

          The Company enters into sales of mortgage-backed securities under
          agreements to repurchase. These agreements are financing
          transactions, and as a result, sales proceeds are treated as
          borrowings and reflected as liabilities in the consolidated
          statements of financial condition.  The amount of the securities
          underlying the agreements remains in the asset account. The
          securities underlying the agreements were delivered to dealers who
          arranged the transactions.  The dealers may have sold, loaned or
          otherwise disposed of the securities to other parties in the
          normal course of their operations, and have agreed to return
          substantially identical securities to the Company at the maturity
          of these agreements.

     (l)  Income Taxes
     
          Deferred tax assets and liabilities are recognized for future tax
          consequences attributable to differences between the financial
          statement carrying amounts of existing assets and liabilities and
          their respective tax basis.  Deferred tax assets and liabilities
          are reflected at currently enacted income tax rates applicable to
          the period in which the deferred tax assets or liabilities are
          expected to be realized or settled.  As changes in tax laws or
          rates are enacted, deferred tax assets and liabilities are
          adjusted through the provision for income taxes.

     (m)  Other Standards

          The Company maintains compensation plans which provide for grants
          of stock options and restricted stock to officers.  As described
          in Note 16, the Company currently follows Accounting Principles
          Board Opinion No. 25, Accounting for Stock Issued to Employees in
          accounting for its plans.  In October 1995, the FASB issued 
          Statement No. 123 entitled Accounting for Stock-Based Compensation
          which encourages, but does not require, companies to use a fair
          value based method of accounting for stock-based employee
          compensation plans.  Under this method, compensation cost is
          measured as of the date stock awards are granted based on the fair
          value rather than the intrinsic value of the award, and such cost
          is recognized over the service period, which is usually the
          vesting period.  If a company elects to continue using the
          intrinsic value based method under Opinion 25, pro forma
          disclosures of net income and net income per share are required,
          as if the fair value based method had been applied.  The Company's
          current policy substantially complies with the requirements of
          Statement 123.

     (n)  Reclassifications

          Reclassifications are made to prior year financial statements
          whenever necessary to conform with the current year presentation.







                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements


(2)  Cash and cash equivalents

<TABLE>
<CAPTION>

     Cash and cash equivalents as of December 31, 1995 and 1994 follows
     (amounts in thousands):

                                                1995         1994
     <S>                                    <C>          <C>
     Federal funds sold-overnight           $ 77,025     $ 20,679
     Federal funds sold-term                  65,800       22,000
     Time deposits                                 -       85,000
     Other interest bearing accounts          26,813       24,726
                                             169,638      152,405
     Cash                                     57,547       62,958     
                                            $227,185     $215,363

</TABLE>

     
(3)  Securities

<TABLE>
<CAPTION>

     The amortized costs and estimated fair values of securities as of
     December 31, 1995 and 1994 follows (amounts in thousands):

                                                  Gross         Gross
                                  Amortized   Unrealized   Unrealized    Estimated
               1995                    Cost        Gains       Losses   Fair Value
    <S>                            <C>            <C>          <C>        <C>
    Securities held to maturity:
      Mortgage-backed
       securities:
        FHLMC                      $128,064       $  797       $  249     $128,612          
        FNMA                         54,685          141          152       54,674          
        GNMA                            207           17            -          224            
        Conventional                 67,478            8        1,448       66,038
      U.S. Treasury bills             4,964           12            -        4,976
      U.S. Treasury notes            45,038          199           10       45,227
      U.S. Government
       and agency bonds                  24            -            -           24

        Total securities held
         to maturity               $300,460       $1,174       $1,859     $299,775

    Securities available for sale:
      Debt securities:
       Mortgage-backed                                                                        
        securities:                        
        Conventional               $ 94,145       $1,255       $    -     $ 95,400                     
        FHLMC                       285,877        2,047          728      287,196
        FNMA                        201,919          870        1,362      201,427
        GNMA                         15,705          210            -       15,915
       U.S. Treasury notes           29,018          224            -       29,242
        Total debt securities       626,664        4,606        2,090      629,180

      Equity securities:
       Other securities                 215            -            -          215

        Total securities
       available for sale          $626,879       $4,606       $2,090     $629,395
      
</TABLE>




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements


<TABLE>
<CAPTION>

(3) Securities, Continued
                                                    Gross        Gross
                                   Amortized   Unrealized   Unrealized    Estimated
              1994                      Cost        Gains       Losses   Fair Value
    <S>                           <C>                <C>       <C>       <C>
    Securities held to maturity:
      Mortgage-backed
       securities:                                                                           
        FHLMC                     $  542,148         $116      $21,550   $  520,714
        FNMA                         312,260           76       21,097      291,239
        GNMA                          15,722           33          605       15,150
        Conventional                 211,274          251        3,270      208,255
      U.S. Treasury bills             18,147            -           97       18,050          
      U.S. Treasury notes             59,963            -        1,184       58,779
      U.S. Government
       and agency bonds                   24            -            -           24

        Total securities 
       held to maturity           $1,159,538         $476      $47,803   $1,112,211

    Securities available for sale:
      Debt securities:
       Mortgage-backed
        securities:
        FHLMC                     $    8,687         $  -      $   422   $    8,265
        FNMA                          13,326           40          255       13,111
        GNMA                          45,346           61        1,230       44,177
        
        Total debt securities         67,359          101        1,907       65,553
      Equity securities:
       Other securities                  210            -            -          210

        Total securities
       available for sale         $   67,569         $101      $ 1,907   $   65,763

</TABLE>


     Under the one-time opportunity allowed by the Financial Accounting 
     Standards Board ("FASB") to reassess the designation of securities, 
     the Company transferred securities with an amortized cost of 
     $684,823,465 and a fair value of $690,293,630 from held to maturity 
     to available for sale in November 1995.  As provided in the FASB 
     guidance, the one-time transfer does not call into question 
     management's ability and intent to hold securities to maturity.





                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(3) Securities, Continued

    Proceeds from the sale of securities available for sale for the years
    ended December 31, 1995 and 1994 were $143,028,000 and $160,634,000,
    respectively.  Gross gains and (gross  losses) realized on these sales
    of securities available for sale were $3,974,000 and $(0), respectively,
    for the year ended December 31, 1995 and $216,000 and $(77,000),
    respectively, for the year ended December 31, 1994.

    GNMA, FHLMC and FNMA mortgage-backed certificates with a carrying value
    of $545,910,000 and $490,780,000 at December 31, 1995 and 1994 were sold
    under  agreements to repurchase (See Note 10).

    FHLMC mortgage-backed certificates with a carrying value of $9,230,000
    and $11,054,000 at December 31, 1995 and 1994 were pledged as collateral
    for the collateralized mortgage obligations issued by the Company (See
    Note 11).


<TABLE>
<CAPTION>

    The amortized cost and estimated fair value of debt securities at
    December 31, 1995 by contractual maturity follows (amounts in
    thousands):


                                  Held to Maturity         Available for Sale 

                               Amortized   Estimated    Amortized    Estimated
                                    Cost  Fair Value         Cost   Fair Value
     <S>                        <C>         <C>          <C>           <C>
     One year or less           $ 34,903    $ 35,086     $  4,635      $ 4,883
     After one year
      through five years         134,951     135,191      151,782      153,283
     After five years
      through ten years           44,223      44,043      189,945      188,207
     After ten years              86,383      85,454      280,302      282,807
                                $300,460    $299,775     $626,664     $629,180

</TABLE>



                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(4)  Loans

<TABLE>
<CAPTION>

     A summary of loans as of December 31, 1995 and 1994 follows (amounts in
     thousands):


                                                         1995           1994 
    <S>                                            <C>            <C>
    Mortgage loans:
      Conventional:
       one to four family residential-fixed        $  199,878     $  151,647 
       one to four family residential-variable      4,697,820      3,980,857 
       commercial and construction                    401,125        357,777 
      FHA insured and VA guaranteed                   106,015        106,609 

               Total mortgage loans                 5,404,838      4,596,890 

    Other loans:
      Second mortgage                                 220,952        232,892 
      Home improvement                                  7,557          9,773 
      Student                                          82,629         72,281 
      Other consumer                                   23,117         19,594 

               Total other loans                      334,255        334,540 

               Total loans                          5,739,093      4,931,430 

      Allowance for loan losses                       (38,842)       (35,373)
      Unearned net loan premiums and fees              37,958         24,248 

               Loans, net                          $5,738,209     $4,920,305 

</TABLE>

    The interest rates on adjustable-rate residential mortgage loans held in
    the Company's portfolio generally float at designated spreads above
    indices based on U.S. Treasury securities.  The loans are generally
    subject to caps on increases in the rate of interest.  Adjustable-rate
    loans may provide for initial rates of interest below the rates that
    would prevail if the market rate indices used for repricing were applied
    initially.  Adjustable-rate mortgages pose potential additional risks,
    primarily because as interest rates rise, the mortgage payments by the
    borrowers rise as a result of periodic repricing, increasing the
    potential for default.



                                     

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(4) Loans, Continued


<TABLE>
<CAPTION>

    The following summarizes activity in the allowance for loan losses for
    the years ended December 31, 1995 and 1994 (amounts in thousands):

                                              1995          1994 
    <S>                                   <C>           <C>
    Balance, beginning of year            $ 35,373      $ 48,461 
    Provision for loan losses               15,336        16,211 
    Loans charged-off                      (14,020)      (21,482)
    Reduction for non-performing
     loan sale                                   -        (9,919)
    Recoveries                               2,153         2,102 

    Balance, end of year                   $38,842       $35,373 

</TABLE>

    In 1994, the Company sold $40,862,800 of non-performing loans and
    foreclosed real estate.  Cash proceeds of the sale were $27,929,400 and
    related valuation allowances at sale date were $9,919,000.  The
    remaining $3,014,400 loss was charged to earnings.

    The principal balance of residential mortgage loans not accruing
    interest as of December 31, 1995 and 1994 amounted to $32,857,000 and
    $19,761,000.  The effect on interest income for non-accrual residential
    loans was $2,942,000 and $2,267,000 for the years ended December 31,
    1995 and 1994.

    Impaired commercial mortgage loans were $4,536,000 at December 31, 1995
    and the total allowance for loan losses related to these loans was
    $2,797,000.  Commercial mortgage loans with modified payment terms were
    immaterial at December 31, 1995 and 1994.  The effect on interest income
    of impaired loans was not material to the consolidated financial
    statements in 1995 and 1994.  The Company is not committed to lend
    additional funds to these borrowers.

    As of December 31, 1995, approximately 28.6% of the outstanding
    principal balance of the Company's residential mortgage loan portfolio
    was located in New York State, 10.2% in New Jersey, and 9.4% in
    Maryland.  The balance was secured by properties located in 45 states,
    with no other state or territory accounting for 8.5% or more of the
    portfolio.  As of December 31, 1995, approximately 83.5% of the
    outstanding principal balance of the Company's portfolio of multi-
    family, commercial and construction mortgage loans was secured by
    properties located in New York State, and 10.2% in New Jersey.  The
    balance was secured by properties located in 18 states, with no other
    state accounting for 2% or more of the portfolio.





                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(4) Loans, Continued

<TABLE>
<CAPTION>

    Total non-performing mortgage loans (including residential, commercial,
    and construction real estate loans) by geographic region as of December
    31, 1995 and 1994 follows (amounts in thousands):

                                   1995                   1994       
                             Amount       %         Amount       % 
    <S>                     <C>        <C>         <C>        <C>    
    New York                $20,678    55.3%       $14,243    62.4%
    New Jersey                5,011    13.4          4,040    17.7 
    Connecticut               4,151    11.1          3,515    15.4 
    All other states          7,553    20.2          1,028     4.5 

        Total               $37,393   100.0%       $22,826   100.0%

</TABLE>

(5) Mortgage Banking Activities

    Mortgage loans includes loans held for sale (which are principally
    residential loans) of $95,974,000 and $18,054,000 as of December 31,
    1995 and 1994.  Proceeds from the sale of loans held for sale were
    $439,714,000 and $508,516,000 for the years ended December 31, 1995 and
    1994.  Net gain(loss) on sales of loans was $2,220,000 and $(572,000)
    for the years ended December 31, 1995 and 1994.  No significant income
    statement impact is anticipated from the disposition of the loans held
    for sale.

    Loans serviced for others, amounting to $6.1 billion and $3.8 billion at
    December 31, 1995 and 1994 are not included in the consolidated
    financial statements.  Custodial escrow balances maintained in
    connection with the foregoing loan servicing were $87,143,932 and
    $67,162,515 at December 31, 1995 and 1994.

<TABLE>
<CAPTION>

    The following analysis reflects the changes in loan servicing rights
    acquired (purchased) and excess loan servicing fees capitalized
    (retained) balances for the years ended December 31, 1995 and 1994
    (amounts in thousands):

                                         Purchased      Retained 
      <S>                                 <C>            <C>
      Balance December 31, 1993           $ 19,242       $18,250 
       Additions                            14,187         2,407      
       Amortization                         (4,367)       (3,426)
      Balance December 31,1994              29,062        17,231 
       Additions                            35,444           688 
       Amortization                         (5,488)       (2,824)
      Balance December 31, 1995            $59,018       $15,095 

</TABLE>




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(5) Mortgage Banking Activities, Continued

    In June 1995, the Company, through the Subsidiary, acquired the
    outstanding common stock of Sibley Mortgage Corporation (Sibley) for $20
    million in cash.  Sibley's primary business was the origination,
    purchase, sale and servicing of residential and multi-family loans.  The
    acquisition was recorded using the purchase method of accounting. 
    Accordingly, purchased mortgage servicing rights of $14.3 million and
    goodwill of $4.2 million were recorded.  Goodwill is being amortized on
    a straight-line method over 10 years.


(6) Accrued Interest Receivable

<TABLE>
<CAPTION>

    Accrued interest receivable as of December 31, 1995 and 1994 follows
    (amounts in thousands):


                                              1995          1994 
        <S>                                <C>           <C> 
        Loans                              $37,003       $29,657 
        Securities                           6,171         7,066 
        Other assets                         1,117         1,060 
                                           $44,291       $37,783 
</TABLE>



(7) Premises and Equipment

<TABLE>
<CAPTION>

        A summary of premises and equipment as of December 31, 1995 and
        1994 follows (amounts in thousands):

                                              1995          1994 
        <S>                               <C>           <C>
        Land                              $  3,369      $  3,408 
        Office buildings                    30,117        27,933 
        Furniture and equipment             41,575        35,365 
        Leasehold improvements              15,272        13,227 
                                            90,333        79,933 
        Less accumulated depreciation
         and amortization                  (33,548)      (23,720)
                                          $ 56,785      $ 56,213 


    Depreciation and amortization expense was $9,361,000 and $7,675,000 for
    the years ended December 31, 1995 and 1994.

</TABLE>


                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements


(8)     Deposits

<TABLE>
<CAPTION>

    A summary of deposits and  interest rates as of December 31, 1995 and
    1994 follows (amounts in thousands):


                                       1995                    1994         
                                          Year End                Year End
                                          Interest                Interest
                                  Amount      Rate        Amount      Rate 
    <S>                       <C>            <C>      <C>            <C> 
    Demand deposits
     and NOW accounts         $  389,423      .78%    $  386,995      .95%

    Passbook, statement
     and club accounts         1,048,225     2.95      1,222,444     2.85 
    Insured money market
     funds                       509,021     3.71        502,697     3.04 
                               1,557,246     3.20      1,725,141     2.91 

    Certificates of
     deposit maturing:
        12 months or less      1,842,879     5.89      1,477,253     4.67 
        13-24 months             201,238     5.97        200,834     5.48 
        25 months or longer      219,716     6.21        240,974     5.86      
                               2,263,833     5.93      1,919,061     4.90 
                              $4,210,502     4.44%    $4,031,197     3.67%


    Jumbo certificates of deposit were $210,961,000 and $156,883,000 at
    December 31, 1995 and 1994.  

</TABLE>

<TABLE>
<CAPTION>

    Interest expense on deposits for the years ended December 31, 1995 and
    1994 follows (amounts in thousands):


                                              1995           1994
    <S>                                   <C>            <C>
    Demand deposits and NOW accounts      $  3,444       $  3,904
    Passbook statement and club accounts    33,286         40,198
    Insured money market funds              17,793         15,995
    Certificates of deposit                119,488         71,474
    Interest on Swaps, net                  (1,834)           950

                                          $172,177       $132,521

</TABLE>



                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

<TABLE>
<CAPTION>

(9) Advances From Federal Home Loan Bank

    Advances from the Federal Home Loan Bank of New York as of December 31,
    1995 and 1994 consisted of the following (amounts in thousands):

                          1995                           1994           
                           Weighted Average               Weighted Average     
    Due Date        Amount    Interest Rate        Amount    Interest Rate
      <C>       <C>               <C>          <C>               <C>
      1995      $        -           -%        $  516,043        5.43%   
      1996         889,742        5.97            573,784        5.98    
      1997         378,161        6.25            354,669        5.82    
      1998         352,174        6.68             25,000        5.51    
      1999           8,500        7.94              8,500        7.94    
      2000          50,000        6.07                  -           -    
      2001          25,518        6.95             25,518        6.95    
      2002             702        2.67                702        2.67    
      2005           5,500        6.35                  -           -    
      2006             256        6.02                256        6.02    
      2007             402        6.45                402        6.45    
                $1,710,955                     $1,504,874

</TABLE>

    The Company has pledged qualifying collateral, primarily mortgage loans,
    with a market value of at least 110% of the amount of the advances.  The
    Company has an available line of credit with Federal Home Loan Bank of
    New York equal to 30% of total assets exclusive of withdrawal advances. 
    The Company is required to hold stock in the Federal Home Loan Bank of
    New York in an amount equal to the greater of 5% of the outstanding
    advance balance or 1% of eligible mortgage loans.


(10)  Securities Sold Under Agreement to Repurchase

    Securities sold under agreements to repurchase as of December 31, 1995
    and 1994 were $570,648,000 and $498,077,000, respectively.  These
    securities are collateralized by mortgage-backed securities with a fair
    value of $545,227,000 and $465,985,000 at December 31, 1995 and 1994.

    The securities sold under agreements to repurchase had a weighted
    average borrowing rate of 6.04% and 4.15% for the years ended Decem-
    ber 31, 1995 and 1994.  Such borrowings had an average outstanding
    balance of approximately $545,928,000 and $403,766,000 for the years
    ended December 31, 1995 and 1994 with the maximum amounts outstanding at
    any month end during these periods of approximately $611,883,000 and
    $524,641,000.   All such borrowings mature within one year.




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

<TABLE>
<CAPTION>

(11)  Collateralized Mortgage Obligations

    In April and August 1986, First Federal Capital Corporation, a wholly
    owned subsidiary of the Subsidiary issued collateralized mortgage bonds
    ("Bonds") of $12,496,000 and $19,542,000.  The Bonds are general
    obligations of the corporation and are collateralized by a pledge of
    FHLMC mortgage-backed certificates with a carrying value of $9,230,000
    and $11,054,000 at December 31, 1995 and 1994.  All payments received on
    the pledged mortgage-backed securities, net of certain costs, must be
    applied to repay the Bonds.  It is expected that the actual life of the
    Bonds will be less than their stated maturity.  A schedule of the Bonds
    outstanding as of December 31, 1995 and 1994 follows (amounts in
    thousands):

                                1995                   1994        
                                    Stated                Stated 
    Maturity               Amount     Rate       Amount     Rate 
    <S>                   <C>         <C>        <C>        <C>
    January, 2000         $ 2,864     7.33%      $3,780     7.33%                    
    September, 2002         3,231     7.89        3,959     7.89 
    October, 2006           2,436     7.27        2,179     7.27 
                          $ 8,531                $9,918
</TABLE>



(12)  Senior and Subordinated Debt

<TABLE>
<CAPTION>

    Senior and subordinated debt is comprised of three notes payable to CT
    North America L.L.C., amounts outstanding as of December 31, 1995 and
    1994 follow (amounts in thousands):

                                                          1995      1994
    <S>                                                <C>       <C>
    Floating Rate Unsecured Senior Capital 
     Note due April 25, 1997.  Interest only
     payable semi-annually, based on the
     current six month LIBOR rate plus 4.5%            $25,000   $25,000
    
    Fixed Rate Unsecured Subordinated Capital 
     Note due March 25, 2003.  Interest only
     payable semi-annually.  Interest fixed at 
     8.25%. Obligation is subordinate to obligation
     under Floating Rate Unsecured Senior
     Capital Note                                       28,000    28,000

    Floating Rate Unsecured Subordinated 
     Capital Note due March 10, 2005.  
     Interest only payable semi-annually, based 
     on the current six month Libor rate plus 1.0%.     29,000         -
                                                       $82,000   $53,000

</TABLE>


<TABLE>
<CAPTION>

    The Company may redeem all or part of the outstanding principal amount
    of the notes at specific redemption prices, plus accrued interest as
    follows:

                                Redemption Price as of % of Principal       
                                $25,000            $29,000           Fixed  
     Year of Redemption    Floating Rate Note  Floating Rate Note  Rate Note
    <C>                          <C>                <C>              <C>
    1995                         100.5%             102.0%           100.0% 
    1996                         100.0              101.0            100.0  
    1997 and thereafter          100.0              100.0            100.0  

</TABLE>


                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(13)  Income Taxes

<TABLE>
<CAPTION>

    Tax Provision

    Income taxes for the years ended December 31, 1995 and 1994 were
    allocated as follows (amounts in thousands):

                                              1995         1994 
      <S>                                  <C>          <C>
      Taxes charged to operations          $29,043      $24,411 

      Taxes charged to stockholder's
        equity, for net unrealized gain
       (loss) on certain securities          1,858         (776)
                                           $30,901      $23,635 
</TABLE>

<TABLE>
<CAPTION>

    The components of the provision for income tax expense (benefit) charged
    to operations for the years ended December 31, 1995 and 1994 are as
    follows (amounts in thousands):

                                              1995         1994 
      <S>                                  <C>          <C>
      Current:
        Federal                            $25,196      $ 9,531 
        State and local                      8,838        3,804 
                                            34,034       13,335 
      Deferred:
        Federal                             (4,290)       7,918      
        State and local                       (701)       3,158 
                                            (4,991)      11,076 
                                           $29,043      $24,411 
</TABLE>

    Reconciliation of Expected Federal Statutory Rate to Actual Rate

<TABLE>
<CAPTION>

    The provision for federal income taxes from continuing operations is
    based on income before taxes at the statutory rate of 35% for the years
    ended December 31, 1995 and 1994 adjusted for the following differences
    (amounts in thousands):


                                              1995       1994 
      <S>                                  <C>        <C>      
      Income tax at statutory rate         $24,938    $19,774 

      Increase (Reduction) in income
        taxes resulting from:
          State and local income taxes,
            net of Federal benefit           5,289      4,525 
          Change in valuation allowance
            for deferred tax assets         (1,164)      (291)
          Other differences                    (20)       403 
      Provision for income taxes           $29,043    $24,411 

</TABLE>



                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements


(13)  Income Taxes, Continued

<TABLE>
<CAPTION>

    Deferred Taxes

    The tax effects of temporary differences that give rise to significant
    portions of the deferred tax assets and liabilities at December 31, 1995
    and 1994 are presented below.

                                                   1995       1994 
      <S>                                      <C>        <C>
      Deferred tax assets:
         Loan valuation allowance              $ 18,743   $ 16,913 
         Intangible asset amortization            3,092      5,770 
         Compensation and benefits                5,001      3,990 
         Purchase accounting - discounts          4,116      2,933      
         Net unrealized loss on securities
          available for sale                          -        776 
         Fixed assets                             1,331      1,900 

      Total gross deferred assets                32,283     32,282 
         Less valuation allowance               (16,747)   (17,911)     
            Net deferred tax assets              15,536     14,371 

      Deferred tax liabilities:
         Tax bad debt reserve                    10,844      9,784      
         Deferred origination income                544        994 
         Loan servicing rights                    2,849      2,217 
         Purchase accounting - premiums           9,477     12,375 
         Net unrealized gain on securities
           available for sale                     1,082          - 
         Other                                    2,222      3,613 

      Total gross deferred tax liabilities       27,018     28,983 

      Net deferred tax liability, included in
        other liabilities                       $11,482    $14,612 

</TABLE>

    The net change in the valuation allowance for deferred tax assets was a
    decline of $1,164,000 and $291,000 for the years ended December 31, 1995
    and 1994, respectively.

    Realization of deferred tax assets is dependent upon the generation of
    future taxable income or the existence of sufficient taxable income
    within the carryback period.  A valuation allowance is provided when it
    is more likely than not that some portion of the deferred tax assets
    will not be realized.  In assessing the continuing need for a valuation
    allowance, management considers the scheduled reversal of the deferred
    tax liabilities, the level of historical taxable income and projected
    future taxable income over the periods in which the temporary
    differences comprising the deferred tax assets will be deductible.  






                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements


(14)  Financial Instruments

    a)   Interest Rate Swaps

<TABLE>
<CAPTION>

      Interest rate swaps entitle the Company to receive variable interest
      payments based on specified spreads over various London Interbank Bid
      and Offer Rates (LIBOR), in exchange for fixed interest payments. 
      The following summarizes the terms and characteristics of interest
      rate swaps as of December 31, 1995 and 1994 (dollar amounts in
      thousands):

                                         1995           1994  
      <S>                               <C>          <C>      
      Carrying amount (including
        accrued interest)               $(822)       $(1,142) 
      Fair value                          242          2,514  
      Hedged item                  3 Month CD's   3 Month CD's
      Notional amount                 $85,000        $200,000 
      Original term to maturity         3 yrs.     2 to 3 yrs.
      Weighted average maturity      3 months            1 yr.
      Weighted average interest
        rate receivable                  5.81%          5.69% 
      Weighted average interest 
        rate payable                     4.69%          4.42% 

</TABLE>

      Net interest (income) expense from interest rate swaps for the years
      ended December 31, 1995 and 1994 was $(1,834,478) and $949,792 which
      is included in interest expense on deposits.


    b)   Interest Rate Caps

<TABLE>
<CAPTION>

      Interest Rate Caps entitle the Company to receive interest payments
      in exchange for payment of a premium, provided the 3 month LIBOR rate
      exceeds the cap rate.  The following summarizes the terms and
      characteristics of the cap agreements as of December 31, 1995 and
      1994 (dollar amounts in thousands):

                                              1995       1994 
      <S>                                 <C>        <C>
      Carrying amount
        (including accrued interest)      $  5,329   $  5,782 
      Fair value                             2,663     15,756 
      Notional amount                      550,000    312,500 
      Weighted cap rate                       5.56%      4.81%
      Weighted term to maturity               1 yr.      2 yr.

</TABLE>

      The Company recognized interest income of $4,408,000 for the year
      ended December 31, 1995 and $2,375,000 in 1994.  Amortized premiums
      for the years ended December 31, 1995 and 1994 were $4,333,000 and
      $2,957,000.  The income received and amortized premium expense were
      included in interest expense on FHLB advances.





                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(14)  Financial Instruments, Continued

<TABLE>
<CAPTION>

    c)   Put Options

      The Company purchases put options on Eurodollar futures contracts, in
      order to offset for the potential effect of rising rates on interest
      margin.  Eurodollar futures are indexed to LIBOR.  The following
      summarizes the terms and characteristics of the put options as of
      December 31, 1995 and 1994 (dollar amounts in thousands):

                                        1995                  1994     
      <S>                         <C>                   <C>
      Carrying amount                   $917                $   985     
      Fair value                         148                 13,808     
      Instrument underlying
        put option                Eurodollar futures    Eurodollar futures
      Contract amount                 $1,875,000           $4,700,000   
      Option expiration dates       March 17, 1997      December 18, 1995
      Strike price                  92.25 to 95.75       92.50 to 94.50 

</TABLE>

      The amount of option premiums amortized and charged to income for the
      years ended December 31, 1995 and 1994 was $6,512,000 and $8,586,000. 
      Amortized gains from sold option contracts were $3,685,000 in 1995
      and $5,400,000 in 1994 and were offset against interest expense on
      FHLB advances.  Unamortized premiums at December 31, 1995 and 1994
      were $928,000 and $3,678,000. Unamortized gains at December 31, 1995
      and 1994 were $11,000 and $2,693,000.

<TABLE>
<CAPTION>

    d)   Call Options

      The Company purchases call options on Eurodollar futures contracts
      and Treasury Notes, in order to offset for the potential effect of
      falling rates on interest margin.  Eurodollar futures are indexed to
      LIBOR. The following summarizes the terms and characteristics of the
      call options as of December 31, 1995 (dollar amounts in thousands):

                                        1995                  1994       
      <S>                         <C>                   <C>
      Carrying amount (including
        net deferred gains)           $  (812)                $489       
      Fair value                        3,364                  183       
      Instrument underlying       Eurodollar futures    Eurodollar futures
        call option               and Treasury Notes    
      Contract amount                $1,432,000             $5,850,000    
      Option expiration dates       June 17, 1996         March 18, 1995  
      Strike price                  93.25 to 95.50        93.75 to 94.75  

</TABLE>

      The amount of option premiums amortized and charged to income for the
      years ended December 31, 1995 and 1994  was $992,000 and $244,000. 
      Amortized gains from sold option contracts in 1995 and 1994 were
      $1,211,000 and $0. Unamortized premiums at December 31, 1995 and 1994
      were $728,000 and $489,000.  Unamortized gains at December 31, 1995
      and 1994 were $1,540,000 and $0.




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(15)  Employee Benefits

    a)   Retirement Plans

      The Company has a non-contributory defined benefit pension plan
      covering substantially all employees.  The plan provides pension
      benefits that are based on each employee's years of service and
      average compensation prior to retirement.  The Company's funding
      policy is to contribute annually at least the minimum required by
      law.  Plan assets are invested in the general account and certain
      separate accounts of The New England Company and Morgan Stanley.

<TABLE>
<CAPTION>

      For the years ended December 31, 1995 and 1994, the net
      pension cost is summarized as follows (amounts in thousands):

                                              1995         1994 
         <S>                               <C>           <C>
         Service cost                      $ 1,042       $1,357 
         Interest cost                       2,498        2,301 
         Return on plan assets              (2,415)      (2,156)
         Net amortization and
            deferral                          (115)        (174)     

         Net periodic pension cost         $ 1,010      $ 1,328 

</TABLE>
 

<TABLE>
<CAPTION>

      The following schedule reconciles the funded status of the plan as of
      December 31, 1995 and 1994 (amounts in thousands):

                                              1995                 1994       
      <S>                              <C>       <C>         <C>       <C>
      Estimated fair value of plan
       assets                                    $ 32,296              $ 31,748 
      Benefit obligations:
        Vested benefit obligation      (25,215)              (24,337)
        Accumulated benefit 
         obligation                    (25,827)              (24,830)
        Projected benefit obligation              (32,068)              (32,318)
      Unrecognized net loss                         4,434                 3,906 
      Unrecorded prior service cost                  (705)                 (833)
      Remaining unrecognized net
       transition asset                              (111)                 (238)

         Net pension asset
            recognized in the 
            consolidated statement 
            of financial condition 
            as of December 31, 1995
            and 1994                              $ 3,846               $ 2,265 

</TABLE>


                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(15)  Employee Benefits, Continued

    a)   Retirement Plans, Continued

<TABLE>
<CAPTION>

      Certain assumptions utilized in the calculation summarized on the
      previous page are as follows:

                                                 1995       1994 
      <S>                                        <C>        <C> 
      Assumed discount rate                      8.25%      7.50%
      Assumed rate of compensation increase      6.00       6.00 
      Expected long term rate of return on
         plan assets                             8.25       7.50 

</TABLE>

      The Company also has a 401(K) Salary Reduction Profit Sharing Plan in
      which substantially all employees are eligible to participate.  Total
      expense for this plan was $746,734 and $722,844 for the years ended
      December 31, 1995 and 1994.

      The Company maintains certain non qualified retirement plans (i.e.,
      Supplemental Employee Retirement Plan and Directors Retirement Plan)
      for key officers and directors.  Certain of these plans are funded
      annually, and the net periodic pension cost recorded for these plans
      was $304,672 and $242,808 for the years ended December 31, 1995 and
      1994.

    b)   Post Retirement Benefits

      The Company sponsors a defined benefit post retirement medical plan
      that covers all of its full time employees.  All employees who retire
      from the Company's defined benefit pension plan who have attained age
      55 with 5 years of service are eligible.  Employees are required to
      contribute a portion of the premium based on their age and service at
      retirement.  Spouses pay the full premium.  The plan is not funded. 
      Upon adoption of SFAS No. 106, the Company recorded the entire
      accumulated post retirement benefit obligation on May 1, 1991. 

      


                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(15)  Employee Benefits, Continued

    b)   Post Retirement Benefits, Continued

<TABLE>
<CAPTION>

      Net periodic postretirement benefit cost for the years ended December
      31, 1995 and 1994 included the following components (amounts in
      thousands):

                                                  1995       1994 
      <S>                                        <C>        <C>
      Service cost - benefits
        attributed to service
        during the period                        $ 472      $ 498 
      Interest cost                                519        527 
      Net amortization and
        deferral                                   (95)       (36)
      Net periodic postretirement
        benefit cost                             $ 896      $ 989 
</TABLE>

<TABLE>
<CAPTION>

      The following table sets forth the plan's funded status reconciled
      with the amount shown in the Company's financial statements at
      December 31, 1995 and 1994 (amounts in thousands):

                                                  1995       1994 
      <S>                                      <C>        <C>
      Accumulated postretirement benefit
        obligation:
           Retired employees                   $(5,123)   $(2,067)
           Active employees                     (1,544)    (5,329)
           Total                                (6,667)    (7,396)
      Plan assets at fair value                      -          - 
      Unfunded accumulated benefit obligation
         in excess of plan assets               (6,667)    (7,396)
      Unrecognized net gain                     (1,464)       (80)
      Unrecognized prior service cost             (473)      (509)
      Accrued postretirement medical
         benefit cost                          $(8,604)   $(7,985)

</TABLE>

      For measurement purposes, a 12.75% annual rate of increase in the per
      capita cost of health care benefits for retirees was assumed for
      1995.  The rate was assumed to decrease gradually to 6.00% by 2006
      and remain at that level thereafter.  The health care cost trend rate
      assumption has a significant effect on the amounts reported.  To
      illustrate, increasing the assumed health care cost trend rates by 1%
      in each year would increase the accumulated postretirement benefit
      obligation at December 31, 1995 by $780,000, and the net periodic
      postretirement benefit cost by $126,000 for the year then ended.  

      The weighted average discount rate used in determining the
      accumulated postretirement obligation was 8.25% for 1995 and 7.50%
      for 1994.



                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(16)  Stock Option Plans and Stock Grant

<TABLE>
<CAPTION>

    On May 8, 1991, the Subsidiary adopted a Non-qualified Stock Option Plan
    (the "Plan") for its officers.  On that date, options were granted to
    purchase 1,004,900 shares of common stock at an exercise price equal to
    the net book value per share at date of grant.  The plan provides for
    subsequent additional awards of stock options based on a formula linked
    to compensation increases.  The basis of subsequent options purchased is
    based on the net book value per share at date of grant.  Subsequent to
    exercise, the optionee may sell the shares back to the Subsidiary at a
    price equal to the current net book value per share.  The right to
    exercise options granted is phased in over a seven year vesting
    schedule.  As of December 31, 1995, 979,590 share options were
    outstanding and become exercisable according to the following schedule:

         Date of Exercisability     Aggregate Number Exercisable
               <S>                           <C>
               May 8, 1995                   602,100
               May 8, 1996                   749,610
               May 8, 1997                   895,245
               May 8, 1998                   927,900
               May 8, 1999                   951,735
               May 8, 2000                   969,255
               May 8, 2001                   979,590

</TABLE>

<TABLE>
<CAPTION>

    The following is a summary of the changes in options outstanding during
    1995 and 1994:

                                            Weighted
                                             Average  Redemption
                                Number  Option Price       Price
                             of Shares     per share   per share
    <S>                      <C>             <C>          <C>
    Outstanding at 
      December 31, 1993      1,050,000       $ 10.41      $13.54
    Granted                     82,200         13.92           -
    Exercised                 (49,495)         10.52       16.02
    Terminated                (80,550)         11.95           -
    Outstanding at 
      December 31, 1994      1,002,155         10.57       14.93
    Granted                     73,700          5.49           -
    Exercised                 (43,295)         11.68       15.57
    Terminated                (52,970)         12.31           -     
    Outstanding at                     
      December 31, 1995        979,590         10.79       16.84

</TABLE>

    On May 8, 1991 the Subsidiary also issued 199,487 shares of common stock
    to senior officers, at the book value per share at date of grant.  The
    grantee may sell the stock back to the Subsidiary at a price equal to
    current net book value per share.  The initial cost of the stock grant
    was included as a merger cost and represents the initial minority
    interest.  Shares issued and outstanding at December 31, 1995 and 1994
    were 156,758 and 156,558 respectively.

    The cost of both plans is recognized based on the increased value of all
    shares granted.  The increased value of both plans, which has been
    recorded as compensation expense, was $1,917,594 for the year ended
    December 31, 1995 and $1,333,696 for 1994.




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements


(17)  Commitments and Contingencies

<TABLE>
<CAPTION>

    At December 31, 1995 and 1994, the Company had commitments outstanding
    generally for up to 90 days, to originate and purchase loans and
    commitments to sell loans as follows (amounts in thousands):

                                               1995          1994
      <S>                                  <C>           <C>
      Commitments outstanding to
         originate and purchase loans      $330,030      $200,695
      Commitments to sell loans             164,319        36,025
      Commitments to purchase 
         mortgage-backed securities          25,000             -
      Commitment to purchase
         interest rate caps                       -         4,946

</TABLE>

    Substantially all commitments to originate and purchase loans (net of
    commitments to sell loans) are for adjustable rate loans with the
    initial interest rate fixed at the commitment date.

    Under pending federal legislation, is the proposed one-time special
    assessment to recapitalize the SAIF insurance fund.  If enacted in its
    current form, the assessment is estimated to be between 75 to 80 basis
    points of SAIF insured deposits held as of March 31, 1995.  Based upon
    these rates the Company's pre-tax expense would be approximately  $31.4
    million to $33.5 million.  There is no assurance that this pending
    legislation will be enacted into law, therefore, the FASB has stated
    that the charge to earnings must be recorded in the period it is
    enacted.  Accordingly, the Company has made no accrual for this
    potential obligation.

    On February 6, 1995, the Superintendent of Banks for the State of New
    York seized Nationar, a check-clearing and trust company, freezing all
    of Nationar's assets.  On that date, the Company had items in process of
    approximately $2,900,000 with Nationar.  Based on information set forth
    in certain publicly available documents, which by their terms are
    preliminary, management believes that there is a reasonable likelihood
    that the Company will not recover all of its items in process owed by
    Nationar.  In accordance with the Company's normal procedures for
    monitoring asset quality, the Company has established a valuation
    allowance of approximately $200,000 against the items in process with
    Nationar at December 31, 1995.  The foregoing event has not had any
    material effect on the Company's ability to meet their liquidity needs. 
    Management has taken all steps necessary to recover the amounts owed the
    Company by Nationar.

<TABLE>
<CAPTION>

    The Company leases certain premises and equipment under various non-
    cancelable operating lease agreements.  At December 31, 1995, the total
    future minimum rental commitments, exclusive of amortization of premiums
    arising from recapitalization, are as follows (amounts in thousands):
                      <C>            <C>
                      1996           $ 3,933
                      1997             3,687
                      1998             3,216
                      1999             2,889
                      2000             2,511
                  Later Years         12,109

</TABLE>

    The total rental expense was $7,187,442 for the year ended December 31,
    1995 and $6,902,963 for 1994.

    In the conduct of business, the Company is involved in various
    litigation matters.  Management  of the Company, based on its review
    with counsel of the development of these matters, is of the opinion that
    the ultimate disposition of these litigation matters should not have a
    materially adverse effect on the financial position of the Company.




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(18)  Fair Values of Financial Instruments

    The following methods and assumptions were used to estimate the fair
    value of each class of financial instruments:
    
    Securities

    Fair values for securities are based on quoted market prices or dealer
    quotes, where available.  Where quoted market prices are not available,
    fair values are based on quoted market prices of comparable instruments.

    Loans

    The fair values of adjustable rate residential real estate loans are
    determined using an option based pricing model.  The cash flows are
    discounted using a rate comprised of an option adjusted spread and the
    appropriate term rate.  The option adjusted spread includes an
    additional spread over that of ARM securities to compensate for the
    added risk associated with whole loans.

    The fair values of fixed rate residential, second mortgage loans,
    consumer loans and commercial mortgages are estimated using a discounted
    cash flow approach, using the appropriate index plus a spread.

    Delinquent loans (not in foreclosure) are valued using the method noted
    above and loans delinquent more than 30 days but less than 91 days
    delinquent, are reduced by an allocated amount of required general
    valuation allowances.  The fair value of loans currently in foreclosure
    is estimated to approximate carrying value, as such loans are generally
    carried at net realizable value.

    Excess Servicing Rights

    Fair value is estimated by discounting the excess net servicing income
    to be received over the estimated servicing term using a current market
    rate.

    Deposits

    The fair value of demand deposits, passbook savings accounts, and
    certain money market accounts is the amount payable on demand at the
    reporting date.  The fair value of fixed maturity certificates of
    deposit is estimated using a discounted cash flow approach that applies
    current market rates (prevailing CD rates) to a schedule of aggregated
    expected monthly maturities on time deposits.

    Advances from Federal Home Loan Bank

    The carrying value of variable rate advances approximates fair value. 
    The fair value of fixed rate advances is estimated using a discounted
    cash flow approach, that applies the current incremental advance
    borrowing rate.




                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(18)  Fair Values of Financial Instruments, Continued

    Collateralized Mortgage Obligations

    The fair value of these instruments is estimated using a discounted cash
    flow approach that applies current market rates for similarly traded
    instruments.

    Senior and Subordinated Debt

    The carrying value of the variable rate instrument, which reprices every
    six months, approximates fair value.  The fair value of the fixed rate
    instrument is estimated using a discounted cash flow approach that
    applies a current market rate for similar securities.

    Interest rate swaps, caps and options

    The fair value of interest rate swaps and interest rate caps are
    obtained from dealer quotes.  These values represent current settlement
    prices.  The fair value of options is also obtained from dealer quotes.

    Other Financial Instruments

    Based on the characteristics of cash and cash equivalents, FHLB stock,
    accrued interest receivable and payable, securities sold under
    agreements to repurchase, advances from borrowers for taxes and
    insurance and the commitments to purchase or sell loans and securities,
    the carrying value approximates fair value.





                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements



(18)  Fair Values of Financial Instruments, Continued

<TABLE>
<CAPTION>

    The following table presents the carrying value and the estimated fair
    values of the forementioned Company's financial instruments as of
    December 31, 1995 and 1994 are as follows (amounts in thousands):


                                          1995                     1994           
                                                  (2)                       (2) 
                                 Carrying        Fair      Carrying        Fair 
                                   Amount       Value        Amount       Value 
    <S>                        <C>         <C>           <C>         <C> 
    Financial Assets:
      Securities               $  929,855  $  929,170    $1,225,301  $1,177,974      
      Loans, net of 
       loss allowances          5,738,209   5,908,304     4,920,305   4,965,878      
      Excess loan servicing 
       fees capitalized            15,095      18,745        17,231      21,600 
      
    Financial Liabilities:
      Deposits                  4,210,502   4,221,482     4,031,197   3,983,676 
      Advances from Federal 
       Home Loan Bank           1,710,955   1,723,322     1,504,874   1,476,262 
      Collateralized mortgage 
       obligations                  8,531      10,467         9,918      10,368                          


    Off-balance sheet financial
     instruments:  (1)                                                                                   

  
           

      Interest rate swaps:
        Net receivable                277         272           979         979 
        Net payable                (1,099)        (30)       (2,121)      1,535                          

      Interest rate caps            5,329       2,663         5,782      15,756 
      Option premiums                 105       3,512         1,474      13,991 



    (1) Amounts reflected under "carrying amount" represent accruals or
        deferred income (expense) arising from those unrecognized financial
        instruments.

    (2) Fair value estimates are made at a specific point in time, based on
        relevant market information and information about the financial
        instrument.  These estimates are subjective in nature and involve
        uncertainties and matters of significant judgement and therefore
        cannot be determined with precision.  Changes in assumptions could
        significantly affect the estimates.   

</TABLE>
        



                                                               Exhibit 23




                        Independent Auditors' Consent


The Board of Directors
CTUS:


We consent to the inclusion of our report dated January 12, 1996, with respect
to the consolidated statements of financial condition of CTUS and subsidiaries
as of December 31, 1995 and 1994, and the related consolidated statements of
income, stockholder's equity, and cash flows for the years then ended, which
report appears in the Form 8-K of HSBC Americas, Inc. dated October 22, 1996.
Our report refers to the adoption of Statements of Financial Accounting
Standards (SFAS) Nos. 114 and 118 on January 1, 1995 and SFAS No. 115 on 
January 1, 1994.


                                           /s/ KPMG Peat Marwick LLP

Rochester, New York
October 22, 1996
[{"type": "8-K", "sequence": "1", "secsgml_size_bytes": 350358}]
{"company-data": {"conformed-name": "HSBC AMERICAS INC", "cik": "0000062348", "assigned-sic": "6022", "irs-number": "221093160", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-02940", "film-number": "96647035"}, "business-address": {"street1": "ONE MARINE MIDLAND CTR", "street2": "MARINE MIDLAND BANK 22ND FL", "city": "BUFFALO", "state": "NY", "zip": "14203", "phone": "7168412424"}, "mail-address": {"street2": "ONE MARINE MIDLAND CENTER 22ND FL", "city": "BUFFALO", "state": "NY", "zip": "14203"}, "former-company": [{"former-conformed-name": "MARINE MIDLAND BANKS INC", "date-changed": "19920703"}, {"former-conformed-name": "MARINE MIDLAND CORP", "date-changed": "19680614"}]}
SECURITIES AND EXCHANGE COMMISSION

                          WASHINGTON, D.C. 20549

                                                 

                                 FORM 8-K

                              CURRENT REPORT

                  PURSUANT TO SECTION 13 OR 15(d) OF THE
                      SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):  October 22, 1996

                            HSBC AMERICAS, INC.
            (Exact name of registrant as specified in charter)

DELAWARE                      I-2940         22-1093160
(State or other juris-        (Commission    (IRS Employer
diction of incorporation)     File Number)   Identification No.)

ONE MARINE MIDLAND CENTER, BUFFALO, NEW YORK 14203
(Address of principal executive offices)

Registrant's telephone number, including area code:  (716) 841-2424

                              Not Applicable
                      (Former name or former address,
                         if changed since report)

                                                                        2.

Item 2.  Acquisition or Disposition of Assets

  On August 29, 1996, HSBC Americas, Inc. (the "Company") filed a Form 8-K
  reporting that on August 21, 1996, the Company and CT Financial Services
  Inc., a federal corporation organized under the laws of Canada (the 
  "Seller"), had entered into a Stock Purchase Agreement pursuant to which 
  the Company agreed to purchase from the Seller all of the issued and 
  outstanding common shares of CTUS Inc. ("CTUS"), a unitary thrift holding
  company.  CTUS owns approximately 99% of the issued and outstanding shares
  of First Federal Savings and Loan Association of Rochester ("First Federal"),
  a thrift institution which, at June 30, 1996 had approximately $7.2 billion 
  in assets and operated 80 branches across New York State, including 31 
  branches in Monroe and Erie counties.  The purchase price to be paid by 
  the Company to the Seller is $620 million in cash, subject to upwards or 
  downwards adjustment to the extent that at the time of closing of the 
  acquisition the book value of First Federal is greater than or less than 
  an amount equal to $400 million plus or minus certain adjustments.  It is 
  contemplated that simultaneously with the purchase of the common shares 
  of CTUS by the Company, First Federal will be merged with and into Marine 
  Midland Bank ("Marine"), the Company's principal subsidiary.  The Stock 
  Purchase Agreement provides that prior to the closing of the purchase of 
  the CTUS common shares by the Company, CTUS will issue to the Seller and 
  the Seller will continue to hold following the purchase, a class of 
  preferred shares of CTUS which will provide for a contingent dividend 
  or redemption equal to the amount of the recovery, net of taxes and costs,
  if any, by First Federal (or Marine as its successor) resulting from the 
  pending action in the United States Court of Claims by First Federal 
  against the United States government alleging breaches by the government 
  of contractual obligations to First Federal following passage of the 
  Financial Institutions Reform, Recovery and Enforcement Act of 1989.  The 
  Company will sell a portion of its portfolio of investment securities to 
  fund the purchase price of the CTUS common shares under the Stock 
  Purchase Agreement.

  Completion of the acquisition is subject to certain conditions, including 
  receipt of necessary regulatory approvals including approval of the Board
  of Governors of the Federal Reserve System and the New York State Banking 
  Department as well as notification of the Office of Thrift Supervision. The 
  transaction when completed will be accounted for as a purchase and the 
  results of CTUS's operations will be included in the Company's financial 
  statements from the date of acquisition. 

  On August 30, 1996 the Company filed a Form 8-K stating that it had reached
  an agreement to acquire the institutional United States dollar clearing
  activity of Morgan Guaranty Trust Company of New York.  This transaction is
  also subject to regulatory approval.  Additionally, prior to June 30, 1996
  the Company acquired two New York City branches of the Hang Seng Bank, an
  affiliate of the Company, and selected assets and liabilities of East River
  Savings Bank.  None of these acquisitions is individually significant to 
  the Company for purposes of Rule 1-02 of Regulation S-X.

Item 7.  Financial Statements and Exhibits

  a. Financial statements of CTUS Inc. are being provided in connection
     with the contemplated acquisition described in Item 2 above.  Audited
     financial statements of CTUS Inc. are included as an Exhibit to this 
     Report and unaudited interim financial information of CTUS Inc. is 
     included herein as follows:

                                                                    3.

     - Consolidated Condensed Balance Sheet of CTUS Inc. as of June 30, 
       1996 (unaudited).

     - Consolidated Condensed Income Statement of CTUS Inc. for the six
       month periods ended June 30, 1996 and June 30, 1995 (unaudited).

     - Consolidated Condensed Statement of Cash Flows of CTUS Inc. for the
       six month periods ended June 30, 1996 and June 30, 1995 (unaudited).

     - Notes to Consolidated Condensed Financial Statements of CTUS Inc.

  b. The following pro forma financial statements are provided:

     - Pro Forma Combined Condensed Balance Sheet of HSBC Americas, Inc. 
       as of June 30, 1996.

     - Pro Forma Combined Condensed Income Statement of HSBC Americas, Inc.
       for the year ended December 31, 1995.

     - Pro Forma Combined Condensed Income Statement of HSBC Americas, Inc.
       for the six months ended June 30, 1996.

     - Notes to Pro Forma Combined Condensed Financial Information of HSBC 
       Americas, Inc.  

                                                                    4.
CTUS Inc.
                Consolidated Condensed Balance Sheet
                           June 30, 1996
                            (Unaudited)

                                                   (in millions)
Assets
   Cash and cash equivalents                          $     197
   Securities available for sale                            614
   Securities held to maturity                              253
   Federal Home Loan Bank stock                              91
   Loans                                                  5,889
   Allowance for loan losses                                (43)
                                                        --------
      Net loans                                           5,846
   Other assets                                             220
                                                        --------
      Total assets                                    $   7,221
                                                        ========
Liabilities and Stockholder's Equity
Liabilities
   Deposits                                           $   4,390
   Securities sold under agreements to repurchase           489
   Advances from Federal Home Loan Bank                   1,780
   Senior and subordinated notes                             82
   Other borrowed funds                                       8
   Other liabilities                                        109
                                                        --------
      Total liabilities                                   6,858
                                                        --------
Stockholder's Equity
   Common stock                                               -
   Additional paid in capital                               163
   Retained earnings                                        205
   Unrealized loss on securities available 
    for sale, net of taxes                                   (5)
                                                        --------
      Total stockholder's equity                            363
                                                        --------
      Total liabilities and stockholder's equity      $   7,221
                                                        ========

See accompanying notes to consolidated condensed financial statements.
5.
CTUS Inc.
          Consolidated Condensed Income Statement
                       (Unaudited)

                                             Six months ended
                                                  June 30,
                                            1996           1995
                                               (in millions)
Interest income                            $ 252          $ 232
Interest expense                             165            150
                                            ----           ----  
Net interest income before
 provision for loan losses                    87             82
Provision for loan loss                        9              8
                                            ----           ----
Net interest income after provision           78             74
                                            ----           ----
Other operating income
   Loan fees                                   3              2
   Loan servicing income, net                  6              5
   Customer service fees                       5              4
   Net gain on sale of 
    mortgage loans and securities              4              -  
   Other                                       6              8
                                            ----           ----  
                                              24             19
                                            ----           ----
                                             102             93
                                            ----           ----
Operating expenses
   Employee compensation and benefits         29             29
   Office, occupancy and equipment            10             10
   General and administrative                 19             16
   Deposit insurance premiums                  5              5
                                            ----           ----
                                              63             60
                                            ----           ----
Income before taxes                           39             33
Income tax expense (benefit)                 (19)            14
                                            ----           ----
Net income                                 $  58          $  19
                                            ====           ====

See accompanying notes to consolidated condensed financial statements.
6.
CTUS Inc.
         Consolidated Condensed Statement of Cash Flows
                         (Unaudited)

                                                   Six months ended
                                                       June 30,
                                                 --------------------
                                                 1996           1995
                                                 -----          -----
                                                     (in millions)
Cash flows from operating activities:
   Net income                                   $  58          $  19
   Adjustments to reconcile net income
    to net cash provided (used) by 
    operating activities
      Non-cash income/expenses                     (6)            13
      Net change in:
         Other assets                              (4)            (5)
         Other liabilities                        (49)           (17)
                                                 -----          -----
   Net cash provided (used) by 
    operating activities                           (1)            10
                                                 -----          -----

Cash flows from investing activities:
   Net change in investments                       58             94
   Net change in loans                           (112)          (378)
   Other, net                                     (15)           (10)
                                                 -----          -----
   Net cash used by investing activities          (69)          (294)
                                                 -----          -----

Cash flows from financing activities:
   Net change in deposits                          54            153
   Net change in advances
    from Federal Home Loan Bank                    68             (8)
   Net change in borrowed funds                   (82)            97
                                                 -----          -----
   Net cash provided by financing activities       40            242
                                                 -----          -----

Net decrease in cash and cash equivalents         (30)           (42)
Cash and cash equivalents at beginning 
 of period                                        227            216
                                                 -----          -----
Cash and cash equivalents at end of period      $ 197          $ 174
                                                 =====          =====

See accompanying notes to consolidated condensed financial statements.
7.

                                   CTUS Inc.

              Notes to Consolidated Condensed Financial Statements

1.   Basis of Presentation

  The accounting and reporting policies of CTUS Inc. (the Company) conform
  to generally accepted accounting principles.  Such policies, except as
  noted below, are consistent with those applied in the presentation of the
  Company's annual financial statements which are contained in the exhibits.

  The interim financial information in this report has not been audited.  In
  the opinion of the Company's management, all adjustments necessary for a
  fair presentation of financial position, results of operations and cash
  flows for the interim periods have been made.  The interim financial
  information should be read in conjunction with the Consolidated Financial
  Statements for the years ended December 31, 1995 and 1994.

2.   New Accounting Standards

  Effective January 1, 1996, the Company adopted the provisions of Statement
  of Financial Accounting Standards No. 122, Accounting for Mortgage
  Servicing Rights (FAS 122) prospectively.  FAS 122 requires that a
  mortgage banking enterprise recognize as separate assets, the right to
  service mortgage loans for others, whether acquired directly or in
  conjunction with the acquisition of mortgage loan assets.

  As originated or purchased mortgage loans are sold, securitized or where a
  definitive plan exists to sell or securitize such loans, their total cost
  is allocated between servicing rights and the loans, based on relative
  fair values.

  FAS 122 specifies that servicing rights be evaluated for impairment based
  on the difference between the carrying value of such rights and their
  current fair value.  For purposes of measuring impairment, which is to be
  recorded through use of a valuation reserve, servicing rights will be
  stratified based upon interest rates and whether or not such rates are
  fixed or variable.

  The adoption of FAS 122 did not have a material effect on the financial
  position or results of operations of the Company.

  The Company is required to adopt Statement of Financial Accounting
  Standards No. 125, Accounting for Transfers and Servicing of Financial
  Assets and Extinguishments of Liabilities (FAS 125), effective January 1,
  1997.  The Company does not expect that the adoption of FAS 125 will have
  a material effect on its financial position or results of operation.

                                                                         8.

                            HSBC Americas, Inc.

      UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL INFORMATION

On August 21, 1996 the Company entered into an agreement to purchase CTUS
Inc., a unitary thrift holding company.  CTUS Inc. owns approximately 99% of
the issued and outstanding shares of First Federal Savings and Loan
Association of Rochester.  The acquisition will be accounted for under the
purchase method of accounting.  The transaction is subject to regulatory
approval and is expected to close no later than the first quarter of 1997.  
In addition to the proposed acquisition of CTUS Inc.: (i) on May 20, 1996 the
Company consummated the acquisition of two New York City branches of Hang Seng
Bank, an affiliate of the Company, (ii) on June 28, 1996 the Company 
consummated the acquisition of selected assets and liabilities of East River
Savings Bank (the "Consummated Transactions") and (iii) on August 13, 1996 the
Company agreed to acquire the United States dollar clearing activities of 
Morgan Guaranty Trust Company of New York (the "Dollar Clearing Activities 
Transaction").  The Dollar Clearing Activities Transaction is subject to 
regulatory approval and is expected to close in the fourth quarter of 1996.  
Neither the Consummated Transactions nor the Dollar Clearing Activities 
Transactions are considered to be acquisitions of businesses.  Reliable 
historical financial information concerning results of operations for these 
nonbusiness transactions are not available and therefore are not included 
in the pro forma combined condensed income statements.  However, results of 
the Consummated Transactions are included in the Company's historical income 
statement for the six months ended June 30, 1996 from their respective dates 
of acquisition.  Apart from the CTUS Inc. acquisition, none of these 
acquisitions is individually significant to the Company for purposes of Rule 
1-02 of Regulation S-X.  The following provides the basis of presentation of 
all of the acquisitions in the Company's pro forma combined condensed 
financial information.

The pro forma combined condensed balance sheet as of June 30, 1996 includes
the CTUS Inc. transaction and the Dollar Clearing Activities Transaction
because the consummation of such transactions is considered to be probable.
Information with respect to the Dollar Clearing Activities Transaction is as
of December 31, 1995 as more recent information is not available.  The 
Consummated Transactions are included in the historical balance sheet of the
Company as of June 30, 1996.  The assets and liabilities relating to such
acquisitions were recorded at their respective fair values at the dates such
acquisitions were consummated.

The accompanying pro forma combined condensed income statement for the year
ended December 31, 1995 and for the six months ended June 30, 1996 present
the pro forma impact of the acquisition of CTUS Inc. assuming that the
acquisition had been completed as of the beginning of each period presented.

The pro forma information is based on the historical financial statements
after giving effect to the impact of the purchase accounting adjustments
relating to the acquisitions.  Assumptions and adjustments are set forth in
the accompanying notes made in connection with the preparation of the pro
forma combined condensed financial information.  Purchase accounting
adjustments to reflect estimated fair values have been made with respect to
the assets and liabilities acquired based upon preliminary estimates and 
evaluations as of June 30, 1996.  The allocations of the purchase prices are
subject to final determination, based upon estimates and other evaluations
of fair value, as of the date the acquisitions are consummated.  Therefore,
the allocations reflected in the following pro forma combined condensed 
financial information may differ from the amounts ultimately determined.

                                                                  9.

The pro forma information with respect to CTUS Inc. has been prepared by
the Company's management based upon the financial statements of CTUS Inc.
included elsewhere herein and information obtained by the Company during
its investigation of the activities acquired.  The pro forma financial
information should be read in conjunction with the notes thereto.  This
pro forma information may not be indicative of the results that actually
would have occurred if the purchase had been consummated on the dates
indicated or which may be obtained in the future.  While the Company expects
to achieve certain operating cost savings as a result of the combination,
no adjustment has been included in the pro forma amounts for anticipated
operating cost savings.

                                                                    10.
HSBC Americas, Inc.
                       Pro Forma Combined Condensed Balance Sheet
                                     June 30, 1996
                                     (Unaudited)
                                    (in millions)   

                                         Historical
                                   ----------------------
                                       HSBC
                                     Americas,    CTUS       Other     Pro Forma     Pro Forma
                                       Inc.       Inc.    Acquisition  Adjustments    Combined 
                                     ---------   -------  -----------  ----------    --------
Assets
   Cash and due from banks         $    2,316 $      197  $       220   $   (45)(2)  $  2,688
   Federal funds sold and 
    securities purchased under
    agreements to resell                  977                   1,130                   2,107
   Trading assets                         871                                             871

                                                                             (4)(6)
                                                                           (660)(4)
   Securities                           3,341        958                   (227)(5)     3,408
   Loans                               14,760      5,889          450        40 (6)    21,139
   Less: allowance for loan loss          458         43                                  501
                                     ---------   -------    ---------   -------       -------  
      Loans, net                       14,302      5,846          450        40        20,638
                                     ---------   -------    ---------   -------       -------   
   Other assets                           794        220                     (4)(6)     1,010
                                                                            276 (4)     
   Goodwill                               126                                12 (6)       414
                                     ---------   -------    ---------   -------       -------
      Total assets                 $   22,727 $    7,221  $     1,800  $   (612)     $ 31,136
                                     =========   ========   =========   =======       =======

Liabilities and Shareholders' Equity
Liabilities
   Deposits - domestic offices     $   14,864 $    4,390  $     1,800  $      6 (6)  $ 21,060
            - foreign offices           2,400                                           2,400
   Federal funds purchased and
    securities sold under
    repurchase agreements               1,184        489                                1,673

                                                                            (82)(1) 
                                                                              2 (6) 
   Other borrowed funds                 2,121      1,870                   (227)(5)     3,684
   Interest, taxes and                                                       16 (3)
    other liabilities                     319        109                     36 (6)       480
                                     ---------   -------     ---------   ------      --------
    Total liabilities                  20,888      6,858         1,800     (249)       29,297
                                     ---------   -------     ---------   ------      -------- 
                                                                           (384)(4) 
                                                                             82 (1) 
                                                                            (45)(2)   
Shareholders' Equity                    1,839        363                    (16)(3)     1,839
                                     ---------   -------     ---------   ------      --------     
      Total liabilities and
       shareholders' equity        $   22,727 $    7,221   $     1,800  $   (612)    $ 31,136
                                     =========   ========    =========   =======    =========

See Notes to Pro Forma Combined Condensed Financial Information.

(1) Conversion to equity of CTUS Inc. debt of $82 million payable to former 
    parent.
(2) Payment of dividend of $45 million by CTUS Inc. to former parent.
(3) As discussed in footnote 17 to the 1995 consolidated financial 
    statements of CTUS Inc. attached as an Exhibit to this Report, CTUS Inc.
    is subject to the one-time assessment to recapitalize the SAIF Insurance
    Fund.  Legislation signed into law on September 30, 1996 resulted in an 
    after tax expense of $16 million being accrued by CTUS Inc. at 
    September 30, 1996 which is one of the downward adjustments to the net
    book value of CTUS Inc. at the time of closing.
(4) Assuming liquidation of investment portfolio to fund acquisitions, 
    including the related goodwill.
(5) Immediate liquidation of $227 million of CTUS Inc. securities portfolio
    upon acquisition and repayment of same amount of advances from the Federal
    Home Loan Bank of New York.
(6) Estimated purchase accounting adjustments to reflect fair value and 
    related acquisition liabilities.
11.
HSBC Americas, Inc.
                  Pro Forma Combined Condensed Income Statement
                           Year ended December 31, 1995
                                   (Unaudited)
                                  (in millions)

                            Historical
                         ---------------
                                                                  HSBC
                              HSBC                           Americas,
                         Americas,    CTUS   Pro Forma        Inc. and
                              Inc.    Inc.     Adjust.       CTUS Inc.
                         ---------    ----   ---------       ---------
$         $         $ (38) (2)      $
                                                   (2) (1)
Interest income              1,488     481        (13) (3)       1,916 
                                                   (7) (1) 
Interest expense               596     315          3  (3)         907
                             -----     ---       ----            -----
Net interest income            892     166        (49)           1,009
                                                        
Provision for loan loss        175      15          -              190    
                             -----     ---       ----            -----
Net interest income
 after provision for
 loan loss                     717     151        (49)             819
Other Operating income         315      43         (6) (3)         352
                             -----     ---       ----            -----
                             1,032     194        (55)           1,171
Operating expenses             696     123         17  (3)         836
                             -----     ---       ----            -----

Income before taxes            336      71        (72)             335
Income taxes                    52      29        (24) (4)          57
                             -----     ---       ----            -----
Net income                  $  284    $ 42      $ (48)          $  278
                             =====     ===       ====            =====

See Notes to Pro Forma Combined Condensed Financial Information.
(1)  Reduction of interest expense associated with $82 million debt conversion 
     to equity and interest income associated with $45 million dividend.
(2)  Reduction of interest income on securities liquidated.
(3)  Impact of pro forma purchase accounting adjustments.
(4)  Income taxes related to applicable adjustments at 43%.
12.
HSBC Americas, Inc.

               Pro Forma Combined Condensed Income Statement
                      Six months ended June 30, 1996
                               (Unaudited)
                              (in millions)

                              Historical
                          -------------------
                                                                       HSBC
                               HSBC                               Americas,
                          Americas,      CTUS     Pro Forma        Inc. and
                               Inc.      Inc.       Adjust.       CTUS Inc.
                          ---------      ----     ---------       ---------
$         $            $(19) (2)      $
                                                        (1) (1)
Interest income                 777       252           (6) (3)       1,003
                                                        (3) (1)
Interest expense                320       165            1  (3)         483
                                ---       ---          ---            -----
Net interest income             457        87          (24)             520
Provision for loan loss          35         9            -               44
                                ---       ---          ---            -----
Net interest income after
 provision for loan loss        422        78          (24)             476
Other operating income          154        24           (3) (3)         175
                                ---       ---          ---            -----
                                576       102          (27)             651
Operating expenses              313        63            9  (3)         385
                                ---       ---          ---            -----
Income before taxes             263        39          (36)             266
Income taxes                     88        16 (5)      (12) (4)          92
                                ---       ---          ---            -----
Net income                     $175      $ 23         $(24)          $  174
                                ===       ===          ===            =====

See Notes to Pro Forma Combined Condensed Financial Information.
(1) Reduction of interest expense associated with $82 million debt conversion
    to equity and interest income associated with $45 million dividend.
(2) Reduction of interest income on securities liquidated.
(3) Impact of pro forma purchase accounting adjustments.
(4) Income taxes related to applicable adjustments at 43%.
(5) Excludes $35 million tax recovery relating to settlement of a net 
    operating loss issue.
13.

                            HSBC Americas, Inc.
        Notes to Pro Forma Combined Condensed Financial Information
                                (Unaudited)

NOTE 1.  Under the purchase agreement relating to the CTUS Inc. acquisition,
immediately prior to consummation of the acquisition of all of the common 
stock of CTUS Inc. by the Company CTUS Inc. will convert senior debt owed to 
its parent to equity and declare and pay a dividend to its parent, in an 
amount to reduce shareholder's equity  immediately prior to the acquisition 
to $400 million plus or minus certain adjustments.  The Company will sell a
portion of its portfolio of investment securities to fund the purchase price
of the CTUS Inc. common shares.

The purchase agreement also provides that prior to the closing of the 
purchase of the CTUS Inc. common shares by the Company, CTUS Inc. will issue
to its former parent and the former parent will continue to hold following 
the purchase, a class of preferred shares of CTUS Inc. which will provide 
for a contingent dividend or redemption equal to the amount of recovery, 
net of taxes and costs if any, by First Federal (or Marine as its successor)
resulting from the pending action against the United States government 
alleging breaches by the government of contractual obligations to First 
Federal following the passage of the Financial Institutions Reform, Recovery
and Enforcement Act of 1989.

NOTE 2.  The assumptions underlying the pro forma purchase accounting
adjustments are summarized as follows:

(a)  The estimated fair value adjustments have been determined by the Company
     based upon information provided by CTUS Inc. and (in the case of the 
     balance sheet adjustments) Morgan Guaranty Trust Company of New York,
     additional information obtained in the preliminary review of the 
     operations of the sellers and various assumptions deemed appropriate 
     by the Company.  The fair values ultimately determined may be different
     from those values used in the pro forma adjustments included herein.

      (i)  Securities were valued at their estimated fair market value as
           of June 30, 1996 less those anticipated to be immediately sold.

     (ii)  Loans were valued based upon interest rates as of June 30, 1996. 
           The resulting net premium is being amortized against income over
           the remaining estimated life of the portfolio utilizing certain
           prepayment assumptions so as to produce a constant yield to
           maturity.

    (iii)  Premises and equipment included in other assets were recorded at
           their estimated fair value.  

     (iv)  Mortgage servicing rights, included in other assets, represent
           acquired servicing rights and were valued at fair value.  The
           resulting premium is being amortized against income over the
           remaining life of the servicing portfolio utilizing certain
           prepayment assumptions.

      (v)  Deposits were valued based upon interest rates for comparable
           deposit liabilities as of June 30, 1996.  The resulting premiums
           are being amortized into interest expense over the remaining
           contractual term so as to produce a constant return to maturity.
                                                               

                                                                    14.

     (vi)  Other borrowed funds were valued based upon interest rates for
           comparable borrowed funds as of June 30, 1996.  Outstandings
           were reduced by amounts received in liquidation of securities.

    (vii)  Upon acquisition it is more likely than not that all tax
           benefits of CTUS Inc. will be realized in some future period by
           the combined entity.  Therefore, the valuation adjustment of
           CTUS Inc. will be brought to zero.

    (viii) Employee benefit liabilities related to employee contracts and
           severance costs related to the elimination of redundant
           personnel costs were recorded.

     (ix)  Liabilities for lease buyouts of facilities to be vacated were
           provided.

      (x)  Excess of the cost of net assets acquired over their fair
           value is being amortized into expense on a straight line basis
           over periods of 10 to 15 years.
(b) The purchase price is estimated to be allocated as described in the 
    table below:

                                 (in millions)
Cost of acquisitions                 $ 660
                                         ---- 
   Net assets acquired                    384 
   Fair value adjustments:
     Securities                            (4)     
     Loans                                 40 
     Other assets
       Mortgage servicing rights           20 
       Premises and equipment             (16)
       Write off of 
        intangible assets                  (8)
     Deposits                              (6)
     Borrowed funds                        (2)
     Reduction in deferred tax
      valuation allowance                  10      
   Other liabilities                          
     Lease termination costs               (4)
     Employee benefits                    (25)
     Acquisition costs                     (6)
     Other costs                           (3)
     Deferred tax liability                (8)
                                          ---    
                                          372 
                                          ---
   Excess of cost of net assets
    acquired over fair value
    (goodwill)                           $288 
                                          ===
NOTE 3.  The Pro Forma Combined Condensed Income Statements for the year 
ended December 31, 1995 and the six months ended June 30, 1996 reflect the
combination of historical operating results of the Company and CTUS Inc. and
include the necessary purchase accounting adjustments as if the combination
had taken place at the beginning of each of the periods presented.  Historical
results of operations relating to the Consummated Transactions and the Dollar
Clearing Activities Transaction are not included as reliable historical
results of operations are not available.  However, results of the Consummated
Transactions are included in the Company's historical income statement for 
the six months ended June 30, 1996 from their respective dates of acquisition.

                                                                       15.

The purchase accounting adjustments used in the preparation of the Pro Forma
Combined Condensed Income Statements are summarized below:
Six Months
                                    Year Ended              Ended
                             December 31, 1995      June 30, 1996

                                            (in millions)
Net income of the Company                 $284               $175
Net income of CTUS Inc.                     42                 23
Pro forma adjustments
  Amortization/accretion of
   purchase accounting adjustments:
     Loans                                (13)                 (6)
     Mortgage servicing rights             (6)                 (3)
     Deposits                              (3)                 (1)
     Excess of cost of net assets
      acquired over fair value            (17)                 (9)
  Loss of interest income on
   investments due to assumed use
   of such investments to fund
   the purchase price                     (38)                (19)
  Reduction in interest expense
   associated with debt conversion
   net of dividend                          5                   2 
  Net tax effect associated 
   with above adjustments excluding 
   amortization of excess of cost
   of net assets acquired over
   fair value                              24                  12 

Pro forma net income                     $278                $174
NOTE 4.  The following table sets forth the projected effect of purchase
accounting adjustments relating to the CTUS Inc. acquisition, the Consummated
Transactions and the Dollar Clearing Activities Transaction,  on the 
operating results of future periods.  The annual amortization of the excess 
cost of net assets acquired over fair value of $17 million relating to CTUS 
Inc. is not subject to deduction for Federal and state taxes.  The projected
amortization and accretion is subject to change in the event of changes in
fair value on consummation date, if such assets are subsequently sold and to
variations between future prepayments assumed in the preparation of the table
and those which may actually occur.

                            1997    1998   1999    2000   2001
Amortization of:
  Premium on loans           $13     $11    $ 8     $ 5    $ 3
  Purchased mortgage 
   servicing rights            6       5      4       3      2
  Discount on deposits         3       3      -       -      -
  Excess cost of net
   assets acquired 
    over fair value           28      28     28      28     28
  Charge to operations       $50     $47    $40     $36    $33

    

                                                                     16.

NOTE 5.  The Consummated Transactions and Dollar Clearing Activities 
Transaction are anticipated to provide $100 million in operating revenues,
offset in part by approximately $60 million in operating expenses excluding
income taxes during the first full year of combined operations.

                                                                      17.

(c)  Exhibits

      2.  Stock Purchase Agreement between CT Financial Services Inc. and
          HSBC Americas, Inc. dated as of August 21, 1996.
     
     13.  Audited consolidated financial statements for CTUS Inc. - 
          December 31, 1995 and 1994, including independent auditors' report
          thereon.
     
     23.  Independent Auditors' Consent

                                                                     18.

                                SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                              HSBC AMERICAS, INC.

                                                                
                              (REGISTRANT)

                              /s/ Gerald A. Ronning
                                                                
                              NAME:   GERALD A. RONNING
                              TITLE:  EXECUTIVE VICE PRESIDENT &
                                      CONTROLLER
                                                                                

Date:  October 22, 1996

                                                   Exhibit 2

                                                                           
ATTORNEY WORK PRODUCT
PRIVILEGED AND CONFIDENTIAL

                                                                     

                                                           
                                    
                        STOCK PURCHASE AGREEMENT
                                                           
                                    
                                    
                                 between
                                    
                                    
                       CT FINANCIAL SERVICES INC.
                               ("Seller")
                                    
                                   and
                                    
                                    
                           HSBC AMERICAS, INC.
                              ("Purchaser")
                                    
                                    
                       dated as of August 21, 1996

                                                                          
                             TABLE OF CONTENTS

                                                                       Page

                                 ARTICLE I

                                DEFINITIONS

     SECTION 1.01.  Certain Defined Terms. . . . . . . . . . . . . . . .  1
     SECTION 1.02.  Additional Defined Terms . . . . . . . . . . . . . .  6

                                ARTICLE II

                             PURCHASE AND SALE

     SECTION 2.01.  Purchase and Sale. . . . . . . . . . . . . . . . . .  8
     SECTION 2.02.  Purchase Price . . . . . . . . . . . . . . . . . . .  8
     SECTION 2.03.  Closing. . . . . . . . . . . . . . . . . . . . . . .  8
     SECTION 2.04.  Purchase Price Adjustment. . . . . . . . . . . . . .  8
     SECTION 2.05.  Certain Accounting Matters . . . . . . . . . . . . . 11

                                ARTICLE III

               REPRESENTATIONS AND WARRANTIES OF THE SELLER

     SECTION 3.01.  Organization and Authority of the Seller . . . . . . 12
     SECTION 3.02.  CTUS Representation. . . . . . . . . . . . . . . . . 12
     SECTION 3.03.  Organization and Qualification of CTUS, the Company
                              and the Subsidiaries . . . . . . . . . . . 12
     SECTION 3.04.  Capital Stock of CTUS. . . . . . . . . . . . . . . . 13
     SECTION 3.05.  Capital Stock of the Company and the Subsidiaries. . 13
     SECTION 3.06.  Consents and Approvals . . . . . . . . . . . . . . . 14
     SECTION 3.07.  No Conflict. . . . . . . . . . . . . . . . . . . . . 15
     SECTION 3.08.  CTUS Financial Statements. . . . . . . . . . . . . . 15
     SECTION 3.09.  Company Financial Statements . . . . . . . . . . . . 16
     SECTION 3.10.  Absence of Certain Changes or Events . . . . . . . . 16
     SECTION 3.11.  Absence of Litigation. . . . . . . . . . . . . . . . 18
     SECTION 3.12.  Compliance with Laws . . . . . . . . . . . . . . . . 18
     SECTION 3.13.  Contracts. . . . . . . . . . . . . . . . . . . . . . 18
     SECTION 3.14.  Reports. . . . . . . . . . . . . . . . . . . . . . . 19
     SECTION 3.15.  Taxes. . . . . . . . . . . . . . . . . . . . . . . . 19
     SECTION 3.16.  Real Property. . . . . . . . . . . . . . . . . . . . 20
     SECTION 3.17.  Environmental Matters. . . . . . . . . . . . . . . . 21
     SECTION 3.18.  Employee Benefit Matters . . . . . . . . . . . . . . 21
     SECTION 3.19.  Labor Matters. . . . . . . . . . . . . . . . . . . . 25
     SECTION 3.20.  Insurance. . . . . . . . . . . . . . . . . . . . . . 25
     SECTION 3.21.  Minority Shares. . . . . . . . . . . . . . . . . . . 25
     SECTION 3.22.  Intercompany Obligations . . . . . . . . . . . . . . 25
     SECTION 3.23.  Community Reinvestment Act . . . . . . . . . . . . . 26
     SECTION 3.24.  Brokers. . . . . . . . . . . . . . . . . . . . . . . 26

                                ARTICLE IV

              REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

     SECTION 4.01.  Organization and Authority of the Purchaser. . . . . 26
     SECTION 4.02.  Organization of Marine Midland Bank. . . . . . . . . 26
     SECTION 4.03.  Consents and Approvals . . . . . . . . . . . . . . . 27
     SECTION 4.04.  No Conflict. . . . . . . . . . . . . . . . . . . . . 27
     SECTION 4.05.  Compliance with Laws . . . . . . . . . . . . . . . . 27
     SECTION 4.06.  Absence of Litigation. . . . . . . . . . . . . . . . 28
     SECTION 4.07.  Securities Law . . . . . . . . . . . . . . . . . . . 28
     SECTION 4.08.  Financing. . . . . . . . . . . . . . . . . . . . . . 28
     SECTION 4.09.  Community Reinvestment Act . . . . . . . . . . . . . 28
     SECTION 4.10.  Brokers. . . . . . . . . . . . . . . . . . . . . . . 28

                                 ARTICLE V

                           ADDITIONAL AGREEMENTS

     SECTION 5.01.  Conduct of Business Prior to the Closing . . . . . . 29
     SECTION 5.02.  Investigation. . . . . . . . . . . . . . . . . . . . 30
     SECTION 5.03.  Access to Information. . . . . . . . . . . . . . . . 31
     SECTION 5.04.  Books and Records. . . . . . . . . . . . . . . . . . 32
     SECTION 5.05.  Confidentiality. . . . . . . . . . . . . . . . . . . 32
     SECTION 5.06.  Authorizations; Consents and Notices . . . . . . . . 33
     SECTION 5.07.  Pre-Closing Payments . . . . . . . . . . . . . . . . 33
     SECTION 5.08.  Notice of Events . . . . . . . . . . . . . . . . . . 34
     SECTION 5.09.  FIRREA Claim . . . . . . . . . . . . . . . . . . . . 34
     SECTION 5.10.  No Solicitation. . . . . . . . . . . . . . . . . . . 36
     SECTION 5.11.  Covenant Not to Compete. . . . . . . . . . . . . . . 37
     SECTION 5.12.  Environmental Audit. . . . . . . . . . . . . . . . . 38
     SECTION 5.13.  Minority Shares. . . . . . . . . . . . . . . . . . . 38
     SECTION 5.14.  Merger Structure . . . . . . . . . . . . . . . . . . 38
     SECTION 5.15.  FIRTPA Certificate . . . . . . . . . . . . . . . . . 39
     SECTION 5.16.  Further Assurances . . . . . . . . . . . . . . . . . 39
     SECTION 5.17.  Transition . . . . . . . . . . . . . . . . . . . . . 40

                                ARTICLE VI

                             EMPLOYEE MATTERS

     SECTION 6.01.  Provision of Comparable Benefits . . . . . . . . . . 40
     SECTION 6.02.  Succession . . . . . . . . . . . . . . . . . . . . . 41
     SECTION 6.03.  Survival . . . . . . . . . . . . . . . . . . . . . . 41

                                ARTICLE VII

                                TAX MATTERS

     SECTION 7.01.  Tax Indemnities. . . . . . . . . . . . . . . . . . . 41
     SECTION 7.02.  Refunds and Tax Benefits . . . . . . . . . . . . . . 43
     SECTION 7.03.  Contests . . . . . . . . . . . . . . . . . . . . . . 44
     SECTION 7.04.  Preparation of Tax Returns . . . . . . . . . . . . . 47
     SECTION 7.05.  Cooperation and Exchange of Information. . . . . . . 47
     SECTION 7.06.  Conveyance Taxes . . . . . . . . . . . . . . . . . . 48
     SECTION 7.07.  Miscellaneous. . . . . . . . . . . . . . . . . . . . 48

                               ARTICLE VIII

                           CONDITIONS TO CLOSING

     SECTION 8.01.  Conditions to Obligations of the Seller. . . . . . . 48
     SECTION 8.02.  Conditions to Obligations of the Purchaser . . . . . 49

                                ARTICLE IX

                     TERMINATION, AMENDMENT AND WAIVER

     SECTION 9.01.  Termination. . . . . . . . . . . . . . . . . . . . . 50
     SECTION 9.02.  Effect of Termination. . . . . . . . . . . . . . . . 50
     SECTION 9.03.  Waiver . . . . . . . . . . . . . . . . . . . . . . . 51
     SECTION 9.04.  Termination Fee. . . . . . . . . . . . . . . . . . . 51

                                 ARTICLE X

                            GENERAL PROVISIONS

     SECTION 10.01. Non-Survival of Representations, Warranties, Covenants
                              and Agreements . . . . . . . . . . . . . . 51
     SECTION 10.02. Release and Indemnification. . . . . . . . . . . . . 52
     SECTION 10.03. Indemnification by the Seller. . . . . . . . . . . . 52
     SECTION 10.04. Prior Tax Sharing Agreements . . . . . . . . . . . . 56
     SECTION 10.05. Expenses . . . . . . . . . . . . . . . . . . . . . . 56
     SECTION 10.06. Federal Home Loan Bank of New York Advances. . . . . 57
     SECTION 10.07. Notices. . . . . . . . . . . . . . . . . . . . . . . 57
     SECTION 10.08. Public Announcements . . . . . . . . . . . . . . . . 58
     SECTION 10.09. Headings . . . . . . . . . . . . . . . . . . . . . . 58
     SECTION 10.10. Severability . . . . . . . . . . . . . . . . . . . . 58
     SECTION 10.11. Disclosure Schedule. . . . . . . . . . . . . . . . . 58
     SECTION 10.12. Entire Agreement . . . . . . . . . . . . . . . . . . 59
     SECTION 10.13. Assignment . . . . . . . . . . . . . . . . . . . . . 59
     SECTION 10.14. No Third-Party Beneficiaries . . . . . . . . . . . . 59
     SECTION 10.15. Amendment; Waiver. . . . . . . . . . . . . . . . . . 59
     SECTION 10.16. Governing Law. . . . . . . . . . . . . . . . . . . . 59
     SECTION 10.17. Counterparts . . . . . . . . . . . . . . . . . . . . 59

EXHIBITS

     Exhibit 2.05(b)          Sample Calculation of the Audited Book Value 
                              of the Company
     Exhibit 3.08             CTUS Financial Statements
     Exhibit 3.09             Company Financial Statements
     Exhibit 5.09(b)          Term Sheet for Preferred Stock
     Exhibit 5.09(e)          Standard of Conduct for FIRREA Plaintiff
     Exhibit 5.14(c)          Proposed Form of Bank Plan of Merger

          STOCK PURCHASE AGREEMENT dated as of August 21, 1996 between
CT FINANCIAL SERVICES INC., a federal corporation organized under the Laws of
Canada (the "Seller"), and HSBC AMERICAS, INC., a Delaware corporation (the
"Purchaser").

                           W I T N E S S E T H :

          WHEREAS, the Seller owns, directly or indirectly, all of the issued 
and outstanding common shares (the "CTUS Shares") of CTUS Inc., a Delaware 
corporation ("CTUS");

          WHEREAS, on the date hereof, CTUS owns approximately 99% of the
issued and outstanding shares (the "Company Shares") of First Federal Savings 
and Loan Association of Rochester (the "Company"); and

          WHEREAS, the Seller wishes to sell to the Purchaser, and the 
Purchaser wishes to purchase from the Seller, the CTUS Shares on the terms and 
conditions set forth herein and wishes to obtain the indirect ownership of all 
of the issued and outstanding shares of the Company;

          NOW, THEREFORE, in consideration of the premises and of the mutual
agreements and covenants hereinafter set forth, the Seller and the Purchaser 
hereby agree as follows:

          
                                 ARTICLE I

                                DEFINITIONS

          SECTION 1.01.  Certain Defined Terms.  As used in this Agreement, the
following terms shall have the following meanings:

          "Affiliate" of a specified person means a person that directly or 
indirectly, through one or more intermediaries, controls, is controlled by, or 
is under common control with, such specified person.

          "Agreed Minimum Audit Date Book Value" means an amount equal to
(a) the sum of (i) U.S.$400,000,000 and (ii) an amount equal to the excess, if 
any, of the Covered Period Net Earnings over the Earnings Amount less (b) the 
sum of (i) the Employee Amount and (ii) the BIF/SAIF Amount plus (c) the 
amount, if any, by which the Employee Amount exceeds U.S. $16,000,000.

          "Agreement" means this Stock Purchase Agreement dated as of August 21,
1996 (including the exhibits and schedules hereto) and all amendments hereto 
made in accordance with the provisions of Section 10.15.

          "BIF/SAIF Amount" means an amount equal to any special one-time
assessment or charge (net of any Tax benefit) paid or accrued by the Company 
prior to the Closing arising out of or related to any Law with respect to 
insurance of deposits (as defined in the FDIA) of the Company by or through 
the Savings Association Insurance Fund (SAIF), but not any regular premium 
paid or accrued prior to the Closing Date, less the present value at the 
Closing Date of the difference between (a) the premiums paid or accrued in 
respect of the Company's deposits from the date such one-time assessment or 
charge was paid or accrued through the Closing Date and (b) the premiums 
that would have been paid or accrued had no such assessment or charge been
paid or accrued.

          "Book Value" means the amount by which total consolidated assets 
exceeds total consolidated liabilities of an entity as shown on any specified 
consolidated balance sheet prepared in accordance with GAAP.

          "Business" means the business of providing financial services and 
related financial products and all other business which is currently being 
conducted by the indicated person or entity.

          "Business Day" means a day of the year on which banks are not 
required or authorized to be closed in New York or Toronto.

          "Chemical Substance" means any pollutant, chemical, mixture, 
petroleum or any fraction thereof, asbestos or asbestos-containing material, 
polychlorinated biphenyls, or any substances, materials or wastes which are 
regulated under any Environmental Law.

          "Code" means the Internal Revenue Code of 1986, as amended through 
the date hereof.

          "Covered Period Net Earnings" means the net earnings of the 
Company excluding the BIF/SAIF Amount and the Employee Amount from July 1, 
1996 through the Audit Date as determined by the Company's Accountants in 
accordance with Section 2.04.

          "Deferred Tax Valuation Amount" means a maximum amount equal to
U.S.$5,000,000 representing a portion of the aggregate valuation allowances 
provided against deferred tax assets of the Company.

          "Earnings Amount" means the sum of (i) U.S.$5,300,000 multiplied 
by the number of months between July 1, 1996 and the Audit Date and 
(ii) U.S.$5,000,000.

          "Employee Amount" means an amount (net of Tax benefit) equal to 
the aggregate amount of all severance payments, benefits, bonus amounts 
relating to all options, completion or stay bonuses, special and long-term 
incentives paid or payable to employees or former employees of the Company 
or other employment-related consideration but only to the extent the same 
arises out of or results from the transactions contemplated by this 
Agreement and any amounts in respect of the foregoing whether or not paid 
or accrued by the Company before the Audit Date.

          "Encumbrance" means a pledge, lien, security interest, mortgage, 
charge, adverse claim of ownership or use, or other encumbrance of any kind.

          "Environment" means any soil, surface waters, groundwaters, stream
sediments, surface or subsurface strata, and ambient air, and any other 
environmental medium.

          "Environmental Laws" means all applicable federal, state, county 
and local Laws or regulations relating to human health and safety, 
protection of the environment or natural resources in existence on the 
date hereof.

          "ERISA" means the Employee Retirement Income Security Act of 1974, 
as amended. 

          "Final Determination" means, as applied to federal income taxes 
in respect of any item for a Period, (i) a final, unappealable decision by 
a court of competent jurisdiction with respect to such taxes, (ii) the 
expiration of the time for filing a claim for refund with respect to such 
taxes or, if a refund claim with respect to such taxes has been timely 
filed, the expiration of the time for instituting suit in respect of such 
refund claim, if no further adjustment to the items of income, gain, 
deduction, loss or credit for such Period may thereafter be made, (iii) 
the execution by or on behalf of the taxpayer and the IRS of a closing 
agreement under Section 7121 of the Code with respect to such taxes, 
(iv) the acceptance by the IRS of a tender pursuant to an offer in 
compromise with respect to such taxes pursuant to Section 7122 of the 
Code, (v) the execution of a Form 870AD with respect to such taxes or 
(vi) any other final and irrevocable determination of the tax liability 
with respect to such taxes of a party to this Agreement (or an Affiliate 
of a party) for the Period.  In the context of state or local income taxes
in respect of any item for a Period, "Final Determination" means any final, 
unappealable and irrevocable determination of the tax liability of a party 
to this Agreement (or an Affiliate of a party) with respect to such taxes 
for the Period.

          "GAAP" means generally accepted accounting principles in the 
United States in effect from time to time applied consistently throughout 
the period involved.

          "Governmental Authority" means any Canadian or United States 
federal, state, provincial or local government or any other foreign 
government, or any governmental, regulatory or administrative authority, 
agency or commission or any court, tribunal, or judicial or arbitral body.

          "Knowledge of the Seller" or "to the Seller's knowledge" means, 
with respect to matters relating to the Seller, the actual knowledge of 
the senior executive officers of the Seller with respect to such matters 
and, in the case of any matters relating to the Company or any of the 
Subsidiaries, such knowledge as is obtainable after the Seller's due 
inquiry of the senior executive officers of the Company set forth in
Section 1.01 of the Seller Disclosure Schedule.

          "Law" means any U.S. or Canadian federal, state, local or foreign 
statute, law, ordinance, regulation, rule, code, order, rule of any U.S. or 
Canadian administrative body, other requirement or rule of law.

          "Leased Property" means any real property listed in Section 
3.16(b) of the Seller Disclosure Schedule.

          "Loan Property" means any property, other than single-family 
residences and Real Estate Owned, securing a loan held by the Company or 
any Subsidiary, or, where required by the context, the Company or any 
Subsidiary is deemed by a court of competent jurisdiction to be the owner 
or operator of such property.

          "Loss" or "Losses" means any and all losses, liabilities, 
obligations, damages, claims, awards or judgments actually suffered or 
incurred by a party including legal costs and expenses to the extent 
provided in Section 10.03(d), but excluding incidental, special, indirect 
or consequential damages, loss of profits or similar damages.

          "Material Adverse Effect" means any change in, or effect on, 
CTUS, the Company or the Subsidiaries, as the case may be, that is 
materially adverse to the results of operations, financial condition or 
properties and assets of CTUS, the Company and the Subsidiaries, taken as 
a whole; provided, however, that changes or effects resulting directly or 
indirectly from (i) changes in Laws or GAAP (or interpretations thereof),
(ii) changes in the general level of market interest rates, (iii) changes 
in the economic, financial or market conditions affecting the banking or 
thrift industry generally in the regions in which CTUS, the Company or 
the Subsidiaries operate, (iv) the effect of any sale or other disposition 
of loans or any other transaction affecting CTUS, the Company or the 
Subsidiaries to the extent the same is made pursuant to, or as permitted or
contemplated by, this Agreement or with the Purchaser's prior written consent 
or at its written direction, or (v) the announcement of this Agreement or 
the transactions contemplated hereby, shall not constitute or contribute to a 
Material Adverse Effect.

          "Minority Shares" means any shares of the Company not owned by CTUS
on the date hereof.

          "Non-Compete Area" means New York State.

          "Period" means, in respect of a particular Tax, the taxable year or 
any other period for which such Tax is imposed.

          "Person" means any individual, partnership, firm, corporation, 
limited liability company, association, trust, unincorporated organization 
or other entity, as well as any syndicate or group that would be deemed to be 
a person under Section 13(d)(3) of the Securities Exchange Act of 1934, as 
amended.

          "Post-Closing Period" means any Period that begins after the Closing 
Date, and, with respect to any Period beginning before and ending after the 
Closing Date, shall mean the portion of such Period commencing on the day 
following the Closing Date.

          "Pre-Closing Period" means any Period that ends on or before the 
Closing Date, and, with respect to any Period beginning before and ending after 
the Closing Date, shall mean the portion of such Period ending on the Closing 
Date.

          "Purchaser Disclosure Schedule" means the Disclosure Schedule of the
Purchaser dated as of the date hereof, delivered by the Purchaser to the Seller 
upon the execution and delivery of this Agreement.

          "Real Estate Owned" means real estate acquired through foreclosure 
or through a deed in lieu of foreclosure.

          "Real Property" means any real property currently or formerly owned 
(but, in the case of formerly owned property only with respect to the period of 
time owned by CTUS, the Company or any Subsidiary) by CTUS, the Company or any 
Subsidiary and all improvements related thereto, including but not limited to 
owned branch offices, but not including Real Estate Owned or Leased Property.

          "Release" shall have the meaning as defined in or pursuant to the
Comprehensive Environmental Response, Compensation, and Liability Act.

          "Returns" means any report, information statement, return, 
declaration or other filing required to be supplied to any taxing authority or 
jurisdiction with respect to Taxes including any amendments thereto.

          "Seller Disclosure Schedule" means the Disclosure Schedule of the 
Seller, dated as of the date hereof, delivered by the Seller to the Purchaser 
upon the execution and delivery of this Agreement.

          "Subsidiary" means each corporation, bank, savings bank, association,
partnership or other entity in which the Company owns or controls 25% or more 
of the voting power of all outstanding voting securities or interests either 
directly or through an unbroken chain of entities as to each of which 25% or 
more of the voting power of all outstanding voting securities or interests is 
owned directly or indirectly by its parent; provided, however, that as used 
in Article III, other than in the first sentence of Section 3.05(b), 
"Subsidiary" shall not include any entity identified in Section 3.05(b) of
the Seller Disclosure Schedule as being an entity the equity securities or 
interests of which (i) have been acquired through foreclosure or (ii) are 
owned or controlled in a fiduciary capacity.

          "Tax" or "Taxes" means all taxes, however denominated, including 
any interest or penalties that may become payable in respect thereof, imposed 
by any federal, state, local or foreign government or any agency or political 
subdivision of any such government, which taxes shall include, without 
limiting the generality of the foregoing, all net income, alternative or 
add-on minimum, gross income, gross receipts, sales, use, goods and services, 
ad valorem, earnings, franchise, profits, withholding, payroll, employment, 
excise, severance, stamp, occupation, premium, property, excess or windfall
profit or value added tax.

          "U.S.$" means United States dollars.

          SECTION 1.02.  Additional Defined Terms.  The following additional
defined terms shall have the meanings set forth in the sections of this 
Agreement listed below:

     Defined Term                 Section Where Defined
                                          
Audit Date                                   2.04(a)
Audit Date Balance Sheet                     2.04(a)
Audited Book Value                           2.04(b)
Audited Financial Statements                 3.09
Bank Merger                                  5.14(a)
Claim Deductible                             10.03(b)(ii)
Closing                                      2.03(a)
Closing Date                                 2.03(a)
Company                                      Recitals
Company Financial Statements                 3.09
Company Shares                               Recitals
Company's Accountants                        2.04(b)
Confidentiality Agreement                    5.05(a)
Contest                                      7.03(b)
CRA                                          3.23
CTUS                                         Recitals
CTUS Financial Statements                    3.08
CTUS Shares                                  Recitals
Differential Amount                          2.04(b)

Electronic Networks                          5.11
FDIA                                         3.03(b)
FDIC                                         3.03(b)
FIRREA Claim                                 5.09(a)
FIRREA Plaintiff                             5.09(a)
FIRREA Recovery                              5.09(a)
HOLA                                         3.03(b)
Indemnifiable Amount                         10.03(b)(ii)
Indemnification Event                        7.03(a)
Intercompany Obligations                     3.22
IRS                                          3.18(b)
Maximum Aggregate Indemnity Payment Amount   10.03(b)(iii)
Merger                                       5.14(a)
Merger Subsidiary                            5.14(a)
Merrill Lynch                                3.24
OTS                                          3.03(a)
PBGC                                         3.18(e)
Plans                                        3.18(a)
Post-Closing Date Tax benefit                7.02(c)
Preferred Stock                              5.09(b)
Preferred Stock Dividend Amount              5.09(b)
Preferred Stock Redemption Amount            5.09(b)
Public Voting Requirement                    5.11
Purchase Price                               2.02
Purchaser                                    Preamble
Purchaser Operating Approvals                4.05(a)
Purchaser's Accountants                      2.04(c)
Purchaser's Required Approvals               4.03(a)
Reports                                      3.14
Seller                                       Preamble
Seller Operating Approvals                   3.12(a)
Seller's Accountants                         2.04(c)
Seller's Required Approvals                  3.06(a)
SLHC Act                                     3.03(a)
Straddle Period                              7.01(c)
Subsidiary Shares                            3.05(b)
Surviving Corporation                        5.14(b)
Tax Liability Threshold Amount               7.01(d)
Unaudited Financial Statements               3.09

                                ARTICLE II

                             PURCHASE AND SALE

          SECTION 2.01.  Purchase and Sale.  On the terms and subject to the
conditions set forth in this Agreement, the Seller agrees to sell to the 
Purchaser, and the Purchaser agrees to purchase from the Seller, on the Closing 
Date, the CTUS Shares.

         SECTION 2.02.  Purchase Price.  The purchase price (the "Purchase 
Price") for the CTUS Shares shall be payable in New York in cash in the net 
amount of U.S.$620,000,000, free of any withholding, deduction or adjustment of 
any nature whatsoever, except as expressly provided for in Sections 2.04 and 
5.15 of this Agreement or as required by Law.  The Purchase Price shall be 
payable as provided in Section 2.03(c).

          SECTION 2.03.  Closing.  (a)  Subject to the terms and conditions of 
this Agreement, the sale and purchase of the CTUS Shares contemplated hereby 
shall take place at a closing at the offices of Shearman & Sterling, 599 
Lexington Avenue, New York, New York (the "Closing") at 10:00 a.m., local 
time, on the first Business Day of the month following the month in which the 
conditions to Closing set forth in Article VIII are first satisfied or waived 
(on the understanding that such conditions shall continue to have been 
satisfied or waived immediately prior to the Closing) or at such other time 
or on such other date or at such other place as the Seller and the Purchaser 
may mutually agree upon in writing (the day on which the Closing takes place 
being the "Closing Date"); provided, however, that, at any time and from 
time to time, the Seller may, at its option, and without consequences of any 
kind or nature, delay the Closing, until a date no later than the first 
Business Day of March 1997.

          (b)  At the Closing, the Seller shall deliver or cause to be 
delivered to the Purchaser (i) certificates evidencing the CTUS Shares duly 
endorsed in blank, in proper form for transfer or accompanied by stock powers 
duly executed in blank and (ii) the certificates and other documents required 
to be delivered pursuant to Section 8.02(a).  

          (c)  At the Closing, the Purchaser shall deliver to the Seller (i) the
Purchase Price by wire transfer in immediately available funds to no more than 
ten (10) accounts designated by the Seller in writing at least two Business 
Days prior to the Closing Date and (ii) the certificates and other documents 
required to be delivered by the Purchaser pursuant to Section 8.01(a).

          SECTION 2.04.  Purchase Price Adjustment.  The parties hereto
acknowledge that the Purchase Price is to be adjusted as specified in this 
Section 2.04 for the purposes described in Section 2.05:

          (a)  As promptly as practicable, but not later than 60 days after the
Closing Date, the Seller and the Purchaser shall cause CTUS to prepare and
deliver to the Seller and the Purchaser an interim consolidated balance sheet 
for CTUS as of the end of the month immediately preceding the Closing Date 
in a manner consistent with past practice (for ease of reference being referred 
to herein as the "Audit Date Balance Sheet" and the date thereof being referred 
to herein as the "Audit Date").

          (b)  Following preparation of the Audit Date Balance Sheet by CTUS,
The Purchaser shall cause CTUS to request the Company's independent
accountants, Deloitte & Touche LLP (the "Company's Accountants"), (i) to 
audit the Audit Date Balance Sheet in accordance with generally accepted 
auditing standards, (ii) to prepare a schedule to the Audit Date Balance 
Sheet showing (x) the Book Value of CTUS as of the Audit Date on the basis 
of the Audit Date Balance Sheet (the "Audited Book Value"), (y) the 
calculation of the Agreed Minimum Audit Date Book Value on the basis of the 
Audit Date Balance Sheet (including the Covered Period Net Earnings, the 
Earnings Amount, the Employee Amount and the BIF/SAIF Amount) and (z) the 
amount, if any, by which the Audited Book Value exceeds or is less than the 
Agreed Minimum Audit Date Book Value (the "Differential Amount") and (iii) 
to deliver a copy of the items noted in (ii) above and an unqualified 
report stating that the Audit Date Balance Sheet fairly presents, in all 
material respects, the financial condition of CTUS as of the Audit Date and 
the schedule thereto fairly presents, in all material respects, the 
information contained therein, in each case in accordance with GAAP and on 
a basis consistent with prior audited balance sheets of CTUS.  The Seller 
shall pay the fees and expenses of the Company's Accountants incurred by 
them in preparing the Audit Date Balance Sheet and responding to any 
questions or disputes arising in connection therewith.
     
          (c)  Within 20 Business Days following the receipt by the Purchaser 
and the Seller of the Audit Date Balance Sheet, each of the Seller's 
Accountants and the Purchaser's independent accountants KPMG Peat Marwick 
LLP (the "Purchaser's Accountants") shall have an opportunity to make such 
investigation of the accounting records of CTUS (and the pertinent portions 
of the relevant work papers of the Company's Accountants) as any of the 
Purchaser, the Seller, the Seller's independent accountants Price Waterhouse 
LLP (the "Seller's Accountants") and the Purchaser's Accountants shall deem 
necessary and, if the Seller's Accountants or the Purchaser's Accountants 
desire, to meet with the Company's Accountants to discuss the determination 
of the Audited Book Value, the Agreed Minimum Audit Date Book Value and the 
Differential Amount.  If, within such 20 Business Day period, the Seller's 
Accountants and/or the Purchaser's Accountants disagree with the amount or 
calculation of any of the foregoing and/or believe that the Audited Balance 
Sheet does not fairly present the financial condition of CTUS, as of the 
Audit Date, in all material respects in accordance with GAAP, then, in 
either such event, either of the Seller's Accountants and/or the Purchaser's 
Accountants may provide the Company with written notice of any such 
disagreement or belief (together with relevant supporting details) and 
thereafter the Seller's Accountants, the Purchaser's Accountants and the 
Company's Accountants shall promptly attempt to resolve any differences or 
concerns that may exist, it being agreed that if such accountants shall be 
unable within a period of 10 Business Days to resolve the differences and
reach agreement, then, in such event, the Purchaser and the Seller will 
endeavor in good faith to resolve the differences amongst themselves during 
an additional period of 10 Business Days.  If, after this additional 10 
Business Day period, the Purchaser and the Seller have failed to so agree, 
the disputed items shall be submitted for final resolution to an independent 
accounting firm selected and agreed to by the Seller's Accountants and the 
Purchaser's Accountants or, if such accountant is unavailable, to such 
other independent accountant as to which the Seller and the Purchaser shall 
agree, which accountant shall be instructed to apply GAAP (and no other 
standards unless agreed to by both parties hereto), to attempt to resolve 
any such dispute and, following any such resolution, determine whether and 
to what extent, if any, the Audited Book Value or the Agreed Minimum Audit 
Date Book Value should be modified or changes should be made to the Audit 
Date Balance Sheet, which determination shall be required to be completed 
within 15 Business Days and shall be final and binding on the parties 
hereto absent manifest error.  The Seller and the Purchaser shall each 
bear one-half of the fees and expenses of such other independent accounting 
firm as is appointed, if any, by the Purchaser and the Seller as 
contemplated herein.

          (d)  Subject to paragraph (c) above and the proviso set forth 
below (and notwithstanding anything to the contrary in Section 2.02), if 
there is a Differential Amount the Purchase Price shall be adjusted from the 
amount actually paid by the Purchaser in accordance with Section 2.03(c), 
and the Purchaser and the Seller agree to make payments to each other 
following the Closing as follows:

               (i)  if there is a Differential Amount as a result of the 
          Audited Book Value being greater than the Agreed Minimum Audit 
          Date Book Value, then, in any such case, the Purchaser shall make 
          an additional payment to the Seller in respect of the Purchase 
          Price in an amount equal to the sum of the Differential Amount 
          and interest at the rate of 6% per annum payable in respect of 
          the period commencing on the Closing Date and continuing through 
          and including the date on which payment in respect of the 
          Differential Amount is made; or 

               (ii) if there is a Differential Amount as a result of the 
          Audited Book Value being less than the Agreed Minimum Audit Date 
          Book Value, then, in any such case, the Seller shall refund to 
          the Purchaser an amount in respect of the Purchase Price in an 
          amount equal to the sum of the Differential Amount and interest 
          at the rate of 6% per annum payable in respect of the period 
          commencing on the Closing Date and continuing through and 
          including the date on which payment in respect of the 
          Differential Amount is made;

     provided, however, that in giving effect to any such increase or 
     decrease in the Purchase Price, the U.S. dollar amounts shall be 
     rounded up or down to the nearest full U.S. dollar.  Any payments 
     required to be made pursuant to this paragraph (d) shall be made by 
     wire transfer of immediately available funds to the account of the 
     Purchaser or the Seller, as the case may be, designated in writing
     not later than 15 Business Days after the date on which the Audit 
     Date Balance Sheet is finally determined in accordance with Section 
     2.04(c).

          (e)  For purposes of this Section 2.04, the Purchaser and the Seller 
     have agreed that each of the accountants referred to in this Section 
     2.04 is to find any adjustments necessary to cause the Audit Date 
     Balance Sheet, to be in accordance with GAAP, and the schedule 
     referred to in Section 2.04(b) to be in accordance with this Agreement.  
     Such adjustments shall be (i) individual items in excess of $1,000,000 
     and (ii) other items in excess of $250,000 but less than $1,000,000 
     that aggregate to $5,000,000 or more.

          SECTION 2.05.  Certain Accounting Matters.  (a)  In addition to 
the obligation of the Purchaser to pay the Purchase Price, (i) the Seller shall 
be entitled to the economic benefit of net earnings of the Company in an 
average amount of up to U.S.$5,300,000 for each month between July 1, 1996 
through and including the Closing Date plus the Deferred Tax Valuation 
Amount, (ii) the Company shall be obligated following the Audit Date to 
pay the Employee Amount to the extent not paid by the Company prior to the 
Audit Date and the Seller shall be entitled in the computation of the 
Agreed Minimum Audit Date Book Value to reverse the after-tax effect of any
actual accrual on or prior to the Audit Date by the Company with respect 
to the Employee Amount but not in excess of U.S.$16,000,000 on or prior to 
the Audit Date, (iii) the Company shall be obligated following the Closing 
to accrue or pay the      BIF/SAIF Amount and, to the extent that the Company 
has been required on or prior to the Audit Date, to fully expense or pay 
for such BIF/SAIF Amount, the Seller shall be entitled in the computation 
of Audited Book Value to reverse the after-tax effect of any payment or 
required accrual by the Company and (iv) the Seller shall be entitled to 
the benefit of the Deferred Tax Valuation Amount which, if not taken into 
income by the Company prior to the Audit Date, the Seller shall be entitled 
in the computation of Audited Book Value to increase such Book Value by the 
amount of the Deferred Tax Valuation Amount.

          (b)  For the avoidance of doubt, it is agreed that as a result of 
Section 2.05(a), there will be an increase in the retained earnings of the 
Company between the date hereof and the Closing Date which will enable the 
Seller to cause the Company to pay a larger extraordinary dividend as 
contemplated by and subject to the limitations contained in Section 5.07.  
For illustrative purposes, Exhibit 2.05(b) provides a sample calculation 
of the Audited Book Value of the Company.

                                ARTICLE III

               REPRESENTATIONS AND WARRANTIES OF THE SELLER

          The Seller represents and warrants to the Purchaser as follows:

          SECTION 3.01.  Organization and Authority of the Seller.  The Seller 
is a corporation duly organized and validly existing under the laws of Canada 
and has all necessary power (corporate or otherwise) and authority to enter 
into this Agreement, to carry out its obligations hereunder and to consummate 
the transactions contemplated hereby.  The execution and delivery of this 
Agreement by the Seller, the performance by the Seller of its obligations 
hereunder and the consummation by the Seller of the transactions 
contemplated hereby have been duly authorized by all requisite corporate
action on the part of the Seller.  This Agreement has been duly executed 
and delivered by the Seller, and (assuming due authorization, execution and 
delivery by the Purchaser) constitutes a legal, valid and binding 
obligation of the Seller enforceable against the Seller in accordance with 
its terms, subject to the effect of any applicable bankruptcy, 
reorganization, insolvency, moratorium or similar Laws affecting creditors' 
rights generally and by general principles of equity (whether considered 
in a proceeding at law or in equity).

          SECTION 3.02.  CTUS Representation.  CTUS has no direct or indirect
subsidiaries, equity investments or joint ventures except for the Company and 
the Subsidiaries.  CTUS is not a party to any mortgage, lease or other 
agreement except as set forth in Section 3.02 of the Seller Disclosure 
Schedule.  As of the Closing, CTUS shall have no assets other than the Company 
Shares and certain Minority Shares and shall have no liabilities, except as 
set forth on its unaudited balance sheet as of June 30, 1996 (parent only), 
a copy of which has heretofore been furnished to the Purchaser and receipt 
of which is hereby acknowledged.  Except as disclosed in Section 3.02 of the
Seller Disclosure Schedule, since the date of its organization CTUS has not 
engaged in any business or operations, except the ownership of the Company 
Shares and certain Minority Shares and has never had any employees or Plans.

          SECTION 3.03.  Organization and Qualification of CTUS, the 
Company and the Subsidiaries.  (a)  CTUS is (i) a corporation duly organized 
and validly existing under the laws of the State of Delaware and (ii) 
registered as a savings and loan holding company with the Office of Thrift 
Supervision ("OTS") under the Savings and Loan Holding Company Act, as 
amended (the "SLHC Act").  True and complete copies of the certificate of 
incorporation and bylaws (or equivalent organizational documents) of CTUS, 
as amended to the date of this Agreement, have been made available for review
by the Purchaser.

          (b)  The Company is a federally chartered stock savings and loan
association duly organized, validly existing and in good standing under the 
laws of the United States of America and engages only in activities (and 
holds properties only of the types) authorized by the Home Owners' Loan Act 
of 1933, as amended ("HOLA") and the OTS rules and regulations thereunder 
and not prohibited by HOLA or the Federal Deposit Insurance Act (the "FDIA")
and the rules and regulations promulgated by the Federal Deposit Insurance 
Corporation (the "FDIC") thereunder for federal savings associations.  The 
Company's deposit accounts are insured to the fullest extent permitted 
under applicable Law by the Savings Association Insurance Fund as 
administered by the FDIC.  The Company is a qualified thrift lender under 
section 10(m) of HOLA and is a member of the Federal Home Loan Bank of 
New York.  True and complete copies of the certificate of incorporation 
and bylaws (or equivalent organizational documents) of the Company, as 
amended to the date of this Agreement, have been made available for review 
by the Purchaser.

          (c)  Each Subsidiary is a corporation duly incorporated, validly 
existing and in good standing under the laws of its jurisdiction of 
incorporation.  True and complete copies of the certificate of incorporation 
and bylaws (or equivalent organization documents) of each Subsidiary, each 
of the foregoing as amended to the date of this Agreement, have been made 
available for review by the Purchaser.  Each Subsidiary engages only in 
activities permitted for subsidiaries or service corporations, as the case
may be, of federal savings associations. 

          (d)  Each of CTUS, the Company and each of the Subsidiaries has 
the requisite power and authority to own, operate or lease the properties 
and assets now owned, operated or leased by it and to carry on, in all 
material respects, that portion of the Business of CTUS, the Company and 
the Subsidiaries as is currently conducted by CTUS, the Company or such 
Subsidiary, as the case may be.  Each of CTUS, the Company and each 
Subsidiary is duly qualified to do business, and is in good standing, in
each jurisdiction where the character of its properties owned, operated or 
leased or the nature of its activities makes such qualification necessary, 
except for such failures to be qualified and in good standing which, 
individually or, to the Seller's knowledge, in the aggregate, would not 
have a Material Adverse Effect.

          SECTION 3.04.  Capital Stock of CTUS.  The Seller owns, directly 
or indirectly, all of the CTUS Shares, and as of the date hereof the CTUS 
Shares constitute all the issued and outstanding shares of capital stock 
of CTUS.  The CTUS Shares have been duly authorized and validly issued and 
are fully paid and nonassessable and were not issued in violation of any 
pre-emptive rights.  Other than the provisions hereof relating to the 
Preferred Stock, there are no outstanding options, warrants or rights of 
conversion or other rights, agreements, arrangements or commitments 
relating to the capital stock of CTUS obligating CTUS to issue or sell any 
of its shares of capital stock.  The Seller is the record and beneficial 
owner of the CTUS Shares, free and clear of all Encumbrances except as a 
result of the Seller's obligation to transfer the CTUS Shares to the 
Purchaser pursuant to this Agreement.  On the Closing Date, the Seller will 
cause to be transferred and delivered to the Purchaser valid title to all 
the CTUS Shares, free and clear of all Encumbrances.

          SECTION 3.05.  Capital Stock of the Company and the Subsidiaries.  
          (a)  The Company Shares have been duly authorized and validly issued 
and are fully paid and nonassessable and were not issued in violation of any 
pre-emptive rights.  The Company's issued and outstanding capital stock 
consists of 23,082,429 shares of common stock, 22,925,671 of which 
constitute the Company Shares.  CTUS is the record and beneficial owner 
of all of the Company Shares and at the Closing, assuming payment by the 
Purchaser of the Purchase Price as contemplated herein, will be the record and
beneficial owner of the Minority Shares (other than those Minority Shares 
disclosed in Section 3.21 of the Seller Disclosure Schedule as to which the 
Seller is unable to acquire as contemplated in Section 5.13), in each case 
free and clear of all Encumbrances, except as a result of the Seller's 
obligation to transfer the CTUS Shares to the Purchaser pursuant to this 
Agreement.  Except as disclosed in Section 3.05(a) of the Seller Disclosure 
Schedule, as of the date hereof, there are, and Seller has made or will make
arrangements so that at the Closing, assuming payment by the Purchaser of the 
Purchase Price as contemplated herein, there will be, no outstanding options, 
warrants or rights of conversion or other rights, agreements, arrangements or 
commitments relating to the capital stock of the Company obligating the 
Company to issue or sell any of its shares of capital stock, except as a 
result of the Seller's obligation to transfer the CTUS Shares to the 
Purchaser pursuant to this Agreement.  
  
          (b)  Section 3.05(b) of the Seller Disclosure Schedule sets forth, 
with respect to each Subsidiary, the authorized capital stock and the 
number and type of its issued and outstanding shares of capital stock 
(collectively, the "Subsidiary Shares").  The Subsidiary Shares constitute 
all the issued and outstanding shares of capital stock of the respective 
Subsidiaries.  The Subsidiary Shares have been duly authorized and validly
issued and are fully paid and nonassessable and were not issued in 
violation of any pre-emptive rights.  There are no outstanding options, 
warrants or rights of conversion or other rights, agreements, arrangements 
or commitments relating to the Subsidiary Shares obligating any Subsidiary 
to issue or sell any of its Subsidiary Shares.  The Company owns the 
Subsidiary Shares issued by the respective Subsidiaries, free and clear 
of all Encumbrances, except as set forth on Section 3.05(b) of the Seller 
Disclosure Schedule, and except for any restrictions on transfer to others 
arising out of this Agreement.

          (c)  Except as set forth in Section 3.05(c) of the Seller 
Disclosure Schedule, there are no stockholder agreements, voting trusts, 
proxies or other similar agreements or understandings in effect with 
respect to the voting or transfer of any of the CTUS Shares, the Company 
Shares or the Subsidiary Shares.

          (d)  Except as set forth in Section 3.05(d) of the Seller 
Disclosure Schedule, the Company does not own more than 5% of the voting 
power of all outstanding voting securities or interests of any corporation, 
limited liability company, business trust, limited partnership or other 
entity.

          SECTION 3.06.  Consents and Approvals.  (a)  The execution and 
delivery of this Agreement by the Seller does not, and the performance of 
this Agreement by the Seller will not, require any consent, approval, 
authorization or other action by, or filing with or notification to, any 
Governmental Authority, or any other Person, except (i) for the consents, 
approvals, authorizations, actions, filings or notifications described in
Section 3.06 of the Seller Disclosure Schedule or as otherwise necessary 
in order to permit the transfer of CTUS Shares by the Seller to an 
Affiliate as contemplated in Section 10.13 (the "Seller's Required 
Approvals"), (ii) for such consents, approvals, authorizations, actions, 
filings, or notifications, the failure to make or obtain which would not, 
individually or, to the Seller's knowledge, in the aggregate either 
(x) prevent or delay the Seller from performing any of its material 
obligations under this Agreement or (y) in the case of Seller's Required 
Approvals from persons other than any Governmental Authority, have a 
Material Adverse Effect, and (iii) as may be necessary as a result of 
any facts or circumstances relating solely to the Purchaser.  

          (b)  The Seller has no reason to believe that it will not be able 
to make or, on a timely basis, obtain all Seller's Required Approvals. 

          SECTION 3.07.  No Conflict.  Assuming all consents, approvals,
authorizations and other actions contemplated in Section 3.06 have been 
obtained and all filings and notifications listed in Section 3.06 of the 
Seller Disclosure Schedule have been made, and except as may result from 
any facts or circumstances relating solely to the Purchaser, and except 
as disclosed in Section 3.07 of the Seller Disclosure Schedule, the 
execution, delivery and performance of this Agreement by the Seller does 
not and will not (a) violate or conflict with the charter or by-laws or 
other organizational documents of the Seller, CTUS, the Company or the 
Subsidiaries, (b) except as would not (i) prevent the Seller from 
performing its material obligations under this Agreement or (ii) 
individually or, to the Seller's knowledge, in the aggregate, have a 
Material Adverse Effect, conflict with or violate any Law, rule, 
regulation, order, writ, judgment, injunction, decree, determination 
or award applicable to the Seller, CTUS, the Company or the Subsidiaries 
or (c) except as would not (i) prevent the Seller from performing any
of its material obligations under this Agreement or (ii) individually or, 
to the Seller's knowledge, in the aggregate, have a Material Adverse 
Effect, result in any breach of, or constitute a default (or event which 
with the giving of notice or lapse of time, or both, would become a 
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of any 
Encumbrance on any of the assets or properties of the Seller, CTUS, the 
Company or any of the Subsidiaries pursuant to, any note, bond, mortgage, 
indenture, contract, agreement, lease, license, permit, franchise or other 
instrument relating to such assets or properties to which the Seller, CTUS, 
the Company or any of the Subsidiaries is a party or by which any of such
assets or properties is bound or affected. 

          SECTION 3.08.  CTUS Financial Statements.  The audited 
consolidated financial statements of CTUS as of December 31, 1995 and the 
unaudited consolidated financial statements of CTUS as of June 30, 1996, 
each attached hereto as Exhibit 3.08 (the "CTUS Financial Statements"), 
have been prepared in accordance with GAAP and fairly present in all 
material respects the financial position and results of operations of
CTUS as of the respective dates thereof and for the periods covered thereby
(subject, in the case of the unaudited financial statements, to normal 
year-end adjustments) in conformity with GAAP.

          SECTION 3.09.  Company Financial Statements.  The audited 
consolidated financial statements of the Company and the Subsidiaries as 
of December 31, 1995 (the "Audited Financial Statements"), and the 
unaudited consolidated financial statements of the Company and the 
Subsidiaries as of June 30, 1996 (the "Unaudited Financial Statements"; 
together with the Audited Financial Statements, the "Company Financial
Statements"), each attached hereto as Exhibit 3.09, have been prepared 
in accordance with GAAP and fairly present in all material respects the 
financial position and results of operations of the Company and the 
Subsidiaries as of the respective dates thereof and for the periods 
covered thereby (subject, in the case of the Unaudited Financial 
Statements, to normal year-end adjustments) in conformity with GAAP.

          SECTION 3.10.  Absence of Certain Changes or Events.  (a)  Except 
as disclosed in Section 3.10 of the Seller Disclosure Schedule, from June 30, 
1996 to the date of this Agreement, the Business of CTUS, the Company and 
the Subsidiaries has been conducted in the ordinary course and consistent 
with past practice.

          (b)  From June 30, 1996 to the date of this Agreement, except as
set forth in Section 3.10 of the Seller Disclosure Schedule or as 
contemplated by this Agreement, there has not been:

          (i)  any instances of damage, destruction or loss to any of the 
     assets or properties of CTUS, the Company or any Subsidiary which, 
     either individually or in the aggregate, have had a Material Adverse 
     Effect;

          (ii) except in the ordinary course of business in connection with
     advances from the Federal Home Loan Bank of New York, any material
     Encumbrance of any kind created by CTUS, the Company or any 
     Subsidiaries or, to the knowledge of the Seller, created by any third 
     party or by operation of Law on any property or asset (whether 
     tangible or intangible) of CTUS, the Company or any Subsidiary;

          (iii)  any establishment, amendment to or increase in any bonus,
     insurance, severance, compensation, fringe benefit, welfare, deferred
     compensation, pension, retirement, profit sharing, stock option 
     (including, without limitation, any grant of any stock options, stock 
     appreciation rights, performance awards or restricted stock awards), 
     stock purchase or other employee benefit plans applicable to current 
     or former employees, directors or consultants of CTUS, the Company or 
     any Subsidiary (or with respect to which CTUS, the Company or any 
     Subsidiary may have any liability), or other increase in the 
     compensation payable or to become payable to any officer, director, 
     employee or consultant of CTUS, the Company or any Subsidiary, except, 
     in any case described above, (x) in the ordinary course of business 
     consistent with past practice or (y) as may be required by applicable 
     Law;

          (iv) any employment, consulting, stay bonus, severance or similar
     agreement entered into, amended, renewed or terminated with any officer,
     employee, director or consultant of CTUS, the Company or any Subsidiary 
     (or with respect to which CTUS, the Company or any Subsidiary may have 
     any liability);

          (v)  any sale, assignment, transfer, lease or other disposition or
     agreement to sell, assign, transfer, lease or otherwise dispose of any 
     of the fixed assets of CTUS, the Company or any Subsidiary having an 
     aggregate value exceeding U.S.$1,000,000;

          (vi) any acquisition (by merger, consolidation, or acquisition of 
     stock or assets) by CTUS, the Company or any Subsidiary of any 
     corporation, partnership or other business organization or division 
     thereof;

          (vii) except in the ordinary course of business in respect of 
     deposits taken, advances from the Federal Home Loan Bank of New York, 
     sales of securities with agreements to repurchase and endorsement of 
     instruments in the course of collection, (x) any incurrence by the 
     Company or any Subsidiary of any indebtedness for borrowed money, (y) 
     any issuance by the Company or any Subsidiary of any debt securities 
     or (z) any assumption, granting, guarantee or endorsement of, or other 
     accommodation arrangement making the Company or any Subsidiary 
     responsible for, the obligations of any individual or legal entity
     (other than the Company or another Subsidiary), in the case of (x), 
     (y) and (z) above, having an aggregate value exceeding U.S.$1,000,000;

          (viii) any change in any method of accounting or accounting 
     practice used by the Company or any Subsidiary, other than changes 
     required by GAAP or regulatory accounting requirements;

          (ix) any reclassification, combination, split, subdivision or any
     redemption, repurchase or other acquisition of the capital stock of, 
     or other equity interests in, CTUS, the Company or any Subsidiary, any 
     declaration or payment of any dividends or distributions (whether in 
     cash, securities or other property) with respect to the shares of the 
     Company, any issuance or sale of additional shares of the capital 
     stock of, or other equity interests in, CTUS, the Company or any
     Subsidiary or securities convertible into or exchangeable for such 
     shares or equity interests, or issuance or granting of any options, 
     warrants, calls, subscription rights or other rights of any kind to 
     acquire additional shares of such capital stock, such other equity 
     interests, or such securities;

          (x)  any amendment of organizational or governing documents of CTUS
     (except as provided in Section 5.09 with respect to the Preferred Stock), 
     the Company or any Subsidiary or any alteration or restructuring of the 
     capitalization of CTUS, the Company or any Subsidiary;

          (xi) any Material Adverse Effect; or

          (xii) except for this Agreement, any agreement to take any actions
     specified in this Section 3.10.

          SECTION 3.11.  Absence of Litigation.  Except as disclosed in Section 
3.11 of the Seller Disclosure Schedule, there are no claims, actions, 
proceedings or investigations pending or, to the Seller's knowledge, threatened 
against the Seller, CTUS, the Company or any Subsidiary, or any of their 
respective assets or properties, before any court, arbitrator or administrative,
governmental or regulatory authority that, individually or, to the Seller's 
knowledge, in the aggregate, would have a Material Adverse Effect or which seek 
to delay, prevent or restrict the consummation of the transactions contemplated 
hereby.  None of CTUS, the Company or any Subsidiary or any of their respective 
assets or properties is subject to any order, writ, judgment, injunction, 
decree, determination or award that would have a Material Adverse Effect. 

          SECTION 3.12.  Compliance with Laws.  (a)  Except as disclosed in
Section 3.12 of the Seller Disclosure Schedule, and except as would not have a 
Material Adverse Effect or a material adverse effect on the Seller's ability 
to perform its obligations under this Agreement, (i) each of CTUS, the Company 
and the Subsidiaries has obtained or made all permits, licenses, approvals, 
authorizations, registrations, qualifications and filings with and under all 
U.S. and foreign laws, authorities and agencies that are required to enable 
it to carry on its Business as currently conducted (the "Seller Operating 
Approvals"), (ii) all Seller Operating Approvals are in full force and effect 
and no suspension of such Seller Operating Approvals has been threatened in
writing and (iii) none of CTUS, the Company or any Subsidiary is in violation 
of any applicable Law.

          (b)  None of the Seller, CTUS, the Company or any of the Subsidiaries
is subject to any cease and desist order, written agreement or memorandum of
understanding with, is a party to any commitment letter or similar undertaking 
to, is subject to any order or directive by, or is a recipient of any 
extraordinary supervisory letter from, or has adopted any extraordinary board 
resolution at the request of, any Governmental Authority charged with the 
supervision or regulation of thrifts or thrift holding companies or engaged 
in the insurance of thrift deposits.

          SECTION 3.13.  Contracts.  Except as disclosed in Section 3.13 of the
Seller Disclosure Schedule, none of CTUS, the Company or any of the Subsidiaries
is, or has received written notice that any other party thereto is, in default 
of any contract, agreement, commitment, arrangement, lease, insurance policy 
or other instrument to which CTUS, the Company or any Subsidiary is a party or 
by which CTUS, the Company or any of the Subsidiaries, or any of their assets, 
business or operations, may be bound or affected except for such defaults 
which individually or, to the Seller's knowledge, in the aggregate would not 
have a Material Adverse Effect. 

          SECTION 3.14.  Reports.  Except as disclosed in Section 3.14 of the 
Seller Disclosure Schedule, the Seller, CTUS, the Company and each Subsidiary 
have filed all reports, registrations and statements, together with any 
required amendments thereto, that it was required to file with the OTS, the 
FDIC and any other applicable banking authorities (the "Reports").  As of 
their respective dates, the Reports complied in all material respects with 
all the rules and regulations promulgated by the OTS, the FDIC or other 
applicable banking authorities, as the case may be.  Copies of all the Reports
have been made available for review by the Purchaser.

          SECTION 3.15.  Taxes.  Except as set forth in Section 3.15 of the 
Seller Disclosure Schedule or except as would not have a Material Adverse 
Effect:

          (a)  Each of CTUS, the Company and each Subsidiary has filed, or has
     had filed on its behalf, in a timely manner (within any applicable 
     extension periods) with the appropriate taxing authority, all Returns with
     respect to Taxes of CTUS, the Company and each of the Subsidiaries other 
     than those Returns on which an immaterial amount of Taxes would properly 
     be shown;

          (b)  All such Returns are true, complete and accurate in all material
     respects;

          (c)  All material Taxes due and payable by or with respect to CTUS, 
     the Company and the Subsidiaries have been paid in full or have been 
     provided for in the books and records of CTUS, the Company or the 
     Subsidiaries, as the case may be, in accordance with GAAP;

          (d)  There are no outstanding agreements or waivers extending the
     statutory period of limitations applicable to any federal, state, local 
     or foreign income or other material Returns required to be filed by or 
     with respect to CTUS, the Company or any of the Subsidiaries;

          (e)  None of the Returns of or with respect to CTUS, the Company or
     any of the Subsidiaries is currently being audited or examined by any 
     taxing authority; 

          (f)  No deficiency for any income Taxes has been assessed with respect
     to CTUS, the Company or any of the Subsidiaries that has not been abated or
     paid in full;

          (g)  The federal income tax returns of CTUS, the Company and each of
     the Subsidiaries have been audited and settled, or are closed to 
     assessment, for all years through 1991;

          (h)  There is no claim or assessment outstanding, or, to the Seller's
     knowledge, threatened against CTUS, the Company or any of the Subsidiaries
     for any alleged deficiency in Taxes, and to the Seller's knowledge there 
     are no audits or investigations with respect to any liability of CTUS, 
     the Company or any of the Subsidiaries for Taxes;

          (i)  Each of CTUS, the Company and each of the Subsidiaries has to
     the extent material withheld from its employees (and timely paid to the
     appropriate taxing authority) the required amounts for all periods since 
     1991 in compliance with all tax withholding provisions of applicable 
     federal, state, local and foreign Laws (including, without limitation, 
     income, social security and employment tax withholding);

          (j)  Each of CTUS, the Company and each of the Subsidiaries has to
     the extent material withheld (and timely paid to the appropriate taxing 
     authority) the required amounts for all periods since 1991 in compliance 
     with all tax withholding provisions of applicable federal, state, local 
     and foreign Laws other than provisions relating to employee withholding 
     (including, without limitation, withholding) of tax on dividends, 
     interest and royalties and similar income earned by nonresident aliens 
     and foreign corporations and withholding of tax on dispositions of 
     United States real property interest);

          (k)  The Seller has furnished or made available to the Purchaser
     complete and accurate copies of all federal, state and local income and 
     franchise tax returns, and any amendments thereto, filed by CTUS, the 
     Company and the Subsidiaries for taxable years ending 1993 and 1994; 

          (l)  There is no contract or agreement in existence under which CTUS,
     the Company or the Subsidiaries have, or may at any time in the future 
     have, an obligation to contribute to the payment of any portion of a 
     Tax (or pay any amount calculated with reference to any portion of a Tax) 
     determined on a consolidated, combined or unitary basis with respect to 
     a group of corporations of which CTUS was not the common parent 
     corporation; and

          (m)  No consent has been filed relating to CTUS or the Company
     pursuant to Section 341(f) of the Code.

          SECTION 3.16.  Real Property.  Each parcel of real property, including
without limitation those properties set forth on Section 3.16(a) of the Seller 
Disclosure Schedule (which lists owned properties) and Section 3.16(b) of the 
Seller Disclosure Schedule (which lists leased properties), owned or leased by 
the Company or any Subsidiary is owned or leased, free and clear of all 
Encumbrances, except (a) as disclosed in Section 3.16(a) or Section 3.16(b) 
of the Seller Disclosure Schedule, (b) with respect to liens for Taxes and 
assessments not yet payable, (c) with respect to liens for Taxes, assessments 
and charges and other claims, the validity of which is being contested in good 
faith by appropriate proceedings and which are also identified in Section 
3.16(c) of the Seller Disclosure Schedule, and (d) with respect to imperfections
of title and other Encumbrances, the existence of which, individually and in 
the aggregate, would not have a Material Adverse Effect. 

          SECTION 3.17.  Environmental Matters.  Except as set forth in Section
3.17 of the Seller Disclosure Schedule or except as would not have a Material 
Adverse Effect:

          (a)  CTUS, the Company and each Subsidiary are and have been in
     compliance with all applicable Environmental Laws;

          (b)  There is no suit, claim, action or proceeding pending or, to the
     knowledge of the Seller, threatened, before any Governmental Authority or 
     other forum in which CTUS, the Company or any Subsidiary has been or, with 
     respect to threatened proceedings, is reasonably likely to be named as a 
     defendant (i) for alleged noncompliance (including by any predecessor) 
     with an Environmental Law or (ii) relating to the Release into or 
     presence in the Environment of any Chemical Substance;

          (c)  To the knowledge of the Seller, there are no facts or 
     circumstances which would provide a reasonable basis for any suit, claim, 
     action or proceeding as described in Section 3.17(b);

          (d)  To the knowledge of the Seller, there has been no release of a
     Chemical Substance in, on, under or affecting any Real Property, Leased
     Property, Real Estate Owned or Loan Property;

          (e)  None of the Real Properties or, to the knowledge of the Seller,
     none of the Leased Properties, Real Estate Owned or Loan Properties, is 
     on the National Priority List (NPL) or the Comprehensive Environmental 
     Response Compensation and Liability Information System (CERCLIS), or is 
     the subject of any investigation, remediation or cleanup of any 
     contamination or potential contamination;

          (f)  None of the Real Properties is subject to, or as a result of this
     transaction would be subject to, the requirements of the New Jersey 
     Industrial Site Recovery Act or the New Jersey Environmental Cleanup 
     Responsibility Act or, to the knowledge of the Seller, to any other state 
     or local Environmental Laws which require notice, disclosure, cleanup or 
     approval prior to transfer of such assets, properties, businesses or 
     operations or which would impose liens on such assets, properties, 
     businesses or operations; and

          (g)  Seller does not participate in the management of any Loan 
     Property within the meaning of 40 C.F.R. Section 300.1100(c).

          SECTION 3.18.  Employee Benefit Matters.  (a)  Section 3.18(a) of the
Seller Disclosure Schedule contains a true and complete list as of the date of 
this Agreement of all employee benefit plans and all bonus, stock option, stock
purchase, incentive, deferred compensation, retiree medical or other welfare 
plans or life insurance, supplemental retirement, severance or other employee 
benefit plans, programs, arrangements, agreements, commitments or payroll 
practices, in each case that are maintained by the Company and/or the 
Subsidiaries or to which the Company and/or the Subsidiaries contribute, that 
benefit or relate to current or former employees of CTUS, the Company and/or 
the Subsidiaries, or with respect to which CTUS, the Company and/or the 
Subsidiaries may incur any liability (including, without limitation, 
"employee benefit plans" within the meaning of Section 3(3) of ERISA, salary
continuation for disability, sick leave, employment agreements, consulting 
agreements, incentive compensation plans, company awards and executive 
compensation plans) (collectively, the "Plans").

          (b)  With respect to each Plan, the Seller has delivered or made
available to the Purchaser a true and correct copy of the following documents 
relating to the Plans, as applicable; (i) the most recent annual report (Form 
5500) filed or required to be filed with the Internal Revenue Service (the 
"IRS"); (ii) the Plan document and all amendments thereto; (iii) the trust 
agreement or funding vehicle and all amendments thereto; (iv) the Summary 
Plan Description and any Summary of Material Modification required under 
ERISA; (v) the most recent actuarial report or valuation relating to any
Plan subject to Title IV of ERISA or any other defined benefit Plan; (vi) 
the most recent determination letter, if any, issued by the IRS with respect 
to any Plan intended to be qualified under Section 401(a) of the Code; (vii) 
all material, written communications to employees or former employees within 
the past three years relating to any Plan or any other written communication 
in the past five years that was materially inconsistent with any Plan document 
or that could cause the Company to incur significant liability; and (viii) 
written descriptions of all non-written plans.

          (c)  Except as set forth in Section 3.18(c) of the Seller Disclosure
Schedule, the Plans that are intended to qualify under Section 401(a) of the 
Code are so qualified, the trusts maintained pursuant thereto are exempt from 
federal taxation under Section 501 of the Code and have received a determination
letter from the IRS to that effect and, to the Seller's knowledge, no event 
has occurred with respect to the operation of the Plans which could cause the 
loss of such qualification or exemption or the imposition of any material 
liability, penalty or tax under ERISA or the Code. 

          (d)  Neither the Company nor any of the Subsidiaries nor any of its or
their ERISA Affiliates (meaning any trade or business, whether or not 
incorporated, under common control with the Seller, CTUS, the Company or the 
Subsidiaries within the meaning of Section 414(b), (c), (m) or (o) of the Code) 
has contributed or been obligated to contribute within the six-year period 
ending on the Closing Date to any multiemployer plan which is described in 
Section 4001(a)(3) of ERISA.  None of the Plans are or have been subject to 
Section 4063 or 4064 of ERISA.

          (e)  Except as set forth in Section 3.18(e) of the Seller Disclosure
Schedule, there has been no "reportable event" as that term is defined in 
Section 4043 of ERISA and the regulations thereunder with respect to any Plans 
subject to Title IV of ERISA (nor will the transactions contemplated by this 
Agreement result in the occurrence of a reportable event described in Section 
4043(c)(9), (10), (11), (12) or (13) of ERISA), nor has there been any event 
requiring disclosure under Sections 4041(c)(3)(C) and 4063(a) of ERISA, 
excluding reportable events for which notice has been waived by the Pension 
Benefit Guaranty Corporation (the "PBGC").

          (f)  Except as set forth in Section 3.18(f) of the Seller Disclosure
Schedule, neither CTUS, the Company, the Subsidiaries, the Seller nor any 
"party in interest" or "disqualified person" with respect to any Plan, nor any 
Plan has engaged in a "prohibited transaction" within the meaning of Section 
4975 of the Code or Section 406 of ERISA which would result in a material 
liability to it.

          (g)  Neither CTUS, the Company nor any of the Subsidiaries nor any of
the ERISA Affiliates has any outstanding liability or is expected to incur any 
liability under or arising out of Title IV of ERISA to the PBGC, to a trust 
established under Section 4041 or 4042 of ERISA or to a trustee appointed under 
Section 4042 of ERISA, to any Plan or to any other Person (other than premiums 
due the PBGC, which premiums have been paid when due).

          (h)  With respect to each Plan, all contributions and premiums 
required by Law or by the terms of any Plan or any agreement related thereto 
have been timely made (without regard to any waivers granted with respect 
thereto), no accumulated funding deficiency (whether or not waived) or liquidity
shortfall exists with respect to any Plan subject to Section 412 of the Code or 
Section 302 of ERISA, all amounts properly accrued to date or as of the Closing 
Date as liabilities of CTUS, the Company or any Subsidiary that have not been 
paid have been properly recorded on the books of CTUS, the Company or the 
Subsidiary, as the case may be, and each payment required to be made by any 
Plan has been made when due and none of the assets of CTUS, the Company nor 
any of the Subsidiaries are the subject of any lien arising under Section 
302(f) of ERISA or Section 412(n) of the Code, and neither CTUS, the Company 
nor any of the Subsidiaries have been required to post security pursuant to 
Section 307 of ERISA or Section 401(a)(29) of the Code and, to the Seller's 
knowledge, facts do not exist which could be expected to give rise to such a 
lien or such posting of security.

          (i)  Each of the Plans has been maintained, in form and operation, in 
all material respects, in accordance with its terms and all provisions of 
applicable Law, including, without limitation, ERISA and the Code.  CTUS, the 
Company and each Subsidiary have complied in all material respects with the 
notice and continuation requirements of Section 4980B of the Code.

          (j)  Except as set forth in Section 3.18(j) of the Seller Disclosure
Schedule, there are no material pending or, to the Seller's knowledge, 
threatened claims, or lawsuits which have been asserted or instituted (and, to 
the Seller's knowledge, there are no facts or circumstances on which any such 
claims or lawsuits could be based) with regard to any of the Plans (other than 
claims for benefits made in the ordinary course of administration of the Plans).

          (k)  Except as disclosed in Section 3.18(k) of the Seller Disclosure
Schedule, the consummation of the transactions contemplated by this Agreement 
will not:  (i) entitle any employee, former employee or any other person to any
payment or (ii) accelerate the time of payment or vesting or increase the 
amount of compensation payable to any person or (iii) otherwise result in any 
"parachute payment" within the meaning of Section 280G of the Code.

          (l)  No event has occurred, or is expected to occur, as a result of 
or in connection with the transactions contemplated by this Agreement, in 
connection with which CTUS, the Company, any Subsidiary or any ERISA Affiliate, 
directly or indirectly, could be subject to any material liability under ERISA, 
the Code or any other Law applicable to any Plan, including, without 
limitation, Section 4971, 4975 or 4976 of the Code or Section 406, 502(i), 
502(l) or 4069 of ERISA, or under any agreement or Law pursuant to or under 
which CTUS, the Company, the Subsidiaries or any ERISA Affiliate has agreed 
to indemnify or is required to indemnify any person against liability incurred 
under, or for a violation of or failure to satisfy the requirements of, any 
such agreement, instrument or Law.

          (m)  Except as set forth in Section 3.18(m) of the Seller Disclosure
Schedule, no Plan provides benefits, including death or medical benefits 
(whether or not insured) with respect to any current or former employee of 
CTUS, the Company or any Subsidiary beyond his or her retirement or other 
termination of service (other than (i) coverage mandated by applicable Law, 
(ii) retirement or death benefits under any employee pension plan, (iii) 
disability benefits under any welfare plan that have been fully provided for 
by insurance or otherwise, (iv) deferred compensation benefits accrued as 
liabilities on the books of CTUS, the Company or the Subsidiaries or (v) 
benefits in the nature of severance pay).

          (n)  Except as disclosed in writing by the Company to the OTS with no
objection from the OTS, each employment agreement entered into by CTUS, the
Company or the Subsidiaries complies with OTS Regulation Section 563.39, the
compensation of officers, directors and employees of CTUS, the Company and 
the Subsidiaries complies with OTS Regulation Section 563.161(b), and the 
compensation arrangements of CTUS, the Company and the Subsidiaries are 
consistent with OTS Regulatory Bulletin RB27a.

          (o)  Except as described in Section 3.18(o) of the Seller Disclosure
Schedule, there is no announced plan, promise or legally binding commitment to 
create any additional Plans or to amend or modify any existing Plan.

          (p)  There has been no material adverse change in the funding status 
of the First Federal Savings and Loan Association of Rochester Pension Plan 
from the status reflected in such plan's actuarial report dated as of January 1,
1995.

          SECTION 3.19.  Labor Matters.  None of CTUS, the Company nor any of
the Subsidiaries is party to any labor agreements with respect to its 
employees with any labor organization, group or association and no labor 
organization or group of employees has made a pending demand for recognition, 
and there is no organizing activity involving the employees of CTUS, the 
Company or the Subsidiaries pending, or, to the Seller's knowledge, threatened, 
by any labor organization or group of employees.  Except as disclosed in 
Section 3.19 of the Seller Disclosure Schedule, or as would not have a 
Material Adverse Effect as of the date of this Agreement, (a) there is no 
unfair labor practice charge or complaint against the Company or any of the 
Subsidiaries pending, or to the Seller's knowledge threatened, before the 
National Labor Relations Board, any comparable state agency or any other 
Governmental Authority, (b) there is no labor strike, labor disturbance, work 
stoppage or other material labor dispute pending or to the Seller's knowledge 
threatened against the Company or any of the Subsidiaries and (c) there are 
no complaints, charges or claims pending with the courts or with a Governmental 
Authority or, to the Seller's knowledge, threatened for which the Seller,
CTUS or the Company has received notice, or based on, arising out of, in 
connection with or otherwise related to the employment by CTUS, the Company 
or the Subsidiaries of any of their employees, including any claim relating to 
employment discrimination, equal pay, employee safety and health, wages and 
hours or workers' compensation.  Except as disclosed in Section 3.19 of the 
Seller Disclosure Schedule, each of the Company and each Subsidiary is in 
material compliance with all applicable Laws respecting employment practices, 
terms and conditions of employment and wages and hours. 

          SECTION 3.20.  Insurance.  Except as set forth in Section 3.20 of the
Seller Disclosure Schedule, all material properties and risks of CTUS, the 
Company and the Subsidiaries are covered by valid and currently effective 
insurance policies or binders of insurance or programs of self-insurance in 
such types and amounts as are consistent with customary practices and standards 
of companies engaged in businesses and operations similar to those of CTUS, 
the Company and the Subsidiaries.

          SECTION 3.21.  Minority Shares.  The Seller has entered into such
arrangements and/or agreements as shall be necessary to cause CTUS to be the 
record and beneficial owner of all of the outstanding Minority Shares as of the 
Closing Date, except as disclosed in Section 3.21 of the Seller Disclosure 
Schedule.  Certificates evidencing all of the  Minority Shares, other than those
disclosed in Section 3.21 of the Seller Disclosure Schedule,  are being held in 
escrow by the Company pending delivery of the same to CTUS on the Closing Date.

          SECTION 3.22.  Intercompany Obligations.  Except as disclosed in 
Section 3.22 of the Seller Disclosure Schedule, as of the date hereof, there 
are no intercompany agreements or arrangements between CTUS, the Company and 
the Subsidiaries, on the one hand, and the Seller or any of its Affiliates, 
on the other hand (the "Intercompany Obligations").

          SECTION 3.23.  Community Reinvestment Act.  The Company (a)
received a rating of "outstanding" in its most recent examination with 
respect to the Community Reinvestment Act (the "CRA") and (b) has not been 
notified in writing with respect to supervisory concerns regarding its 
compliance with the CRA or, to the extent applicable, the New York Community 
Reinvestment Act.  

          SECTION 3.24.  Brokers.  Except for Merrill Lynch, Pierce, Fenner &
Smith Incorporated ("Merrill Lynch"), no broker, finder or investment banker 
is entitled to any brokerage, finder's or other fee or commission in 
connection with the transactions contemplated by this Agreement based upon 
arrangements made by or on behalf of the Seller.  The Seller is solely 
responsible for the fees and expenses of Merrill Lynch.

                                ARTICLE IV

              REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

          The Purchaser represents and warrants to the Seller as follows:

          SECTION 4.01.  Organization and Authority of the Purchaser.  The
Purchaser is a corporation duly organized, validly existing and in good 
standing under the laws of the State of Delaware and has all necessary power 
(corporate or otherwise) and authority to enter into this Agreement, to carry 
out its obligations hereunder and to consummate the transactions contemplated 
hereby.  The execution and delivery of this Agreement by the Purchaser, the 
performance by the Purchaser of its obligations hereunder and the consummation 
by the Purchaser of the transactions contemplated hereby have been duly 
authorized by all requisite corporate action on the part of the Purchaser.  
This Agreement has been duly executed and delivered by the Purchaser, and 
(assuming due authorization, execution and delivery by the Seller) constitutes 
a legal, valid and binding obligation of the Purchaser enforceable against 
the Purchaser in accordance with its terms, subject to the effect of any 
applicable bankruptcy, reorganization, insolvency, moratorium or similar laws 
affecting creditors' rights generally and by general principles of equity 
(whether considered in a proceeding at law or in equity).  The Purchaser 
directly owns all of the issued and outstanding shares of capital stock of 
Marine Midland Bank, a New York State chartered commercial bank.

          SECTION 4.02.  Organization of Marine Midland Bank.  Marine Midland
Bank is a New York State chartered commercial bank, duly organized, validly 
existing, and in good standing under the laws of the State of New York, and 
has the requisite corporate power and authority to own its assets and carry 
on its business as currently conducted.  The deposits of Marine Midland Bank 
are insured to the fullest extent permitted under applicable law by the Bank 
Insurance Fund of the FDIC.
 
          SECTION 4.03.  Consents and Approvals.  (a)  The execution and 
delivery of this Agreement by the Purchaser do not, and the performance of 
this Agreement by the Purchaser will not, require any consent, approval, 
authorization or other action by, or filing with or notification to, any 
Governmental Authority, or any other Person, except (i) for the consents, 
approvals, authorizations, actions or filings described in Section 4.03 of
the Purchaser Disclosure Schedule (the "Purchaser's Required Approvals"), 
(ii) for such consents, approvals, authorizations, actions, filings or 
notifications the failure to make or obtain which would not, individually or 
in the aggregate either, prevent or delay the Purchaser from performing any 
of its material obligations under this Agreement and (iii) as may be 
necessary as a result of any facts or circumstances relating solely to the
Seller.    

          (b)  The Purchaser has no reason to believe that it will not be able 
to make or, on a timely basis, obtain all the Purchaser's Required Approvals.

          SECTION 4.04.  No Conflict.  Assuming all consents, approvals,
authorizations and other actions contemplated in Section 4.03 have been 
obtained and all filings and notifications listed in Section 4.03 of the 
Purchaser Disclosure Schedule have been made and, except as may result from 
any facts or circumstances relating solely to the Seller, the execution, 
delivery and performance of this Agreement by the Purchaser do not and will 
not (a) violate or conflict with the charter or by-laws or other
organizational documents of the Purchaser, (b) except as would not prevent the
Purchaser from performing its material obligations under this Agreement, 
conflict with or violate any law, rule, regulation, order, writ, judgment, 
injunction, decree, determination or award applicable to the Purchaser, or 
(c) except as would not prevent the Purchaser from performing any of its 
material obligations under this Agreement, result in any breach of, or 
constitute a default (or event which with the giving of notice or lapse of
time, or both, would become a default) under, or give to others any rights 
of termination, amendment, acceleration or cancellation of, or result in the 
creation of any Encumbrance on any of the assets or properties of the 
Purchaser pursuant to, any note, bond, mortgage, indenture, contract, 
agreement, lease, license, permit, franchise or other instrument relating to 
such assets or properties to which the Purchaser or any of its respective 
subsidiaries is a party or by which any of such assets or properties is bound 
or affected.

          SECTION 4.05.  Compliance with Laws.  (a)  (i) Each of the Purchaser,
Marine Midland Bank and each subsidiary of Marine Midland Bank has or has 
obtained or made all permits, licenses, approvals, authorizations, 
registrations, qualifications and filings with and under all U.S. and foreign 
laws, authorities and agencies that are required to enable it to carry on its 
Business as currently conducted (the "Purchaser Operating Approvals"), (ii) 
all the Purchaser Operating Approvals are in full force and effect, and no 
suspension of such Purchaser Operating Approvals has been threatened in
writing and (iii) none of the Purchaser, Marine Midland Bank or any 
subsidiary of Marine Midland Bank is in violation of any applicable Law, 
except for such failures to obtain or have in full force and effect such 
Purchaser Operating Approvals, such suspensions of Purchaser Operating 
Approvals and such violations of Law as would not individually or, to the 
best of the Purchaser's knowledge, in the aggregate prevent the Purchaser 
from performing its material obligations under this Agreement.

          (b)  None of the Purchaser, Marine Midland Bank or any subsidiary of
Marine Midland Bank is subject to any cease and desist order, written agreement
or memorandum of understanding with, is a party to any commitment letter or 
similar undertaking to, is subject to any order or directive by, or is a 
recipient of any extraordinary supervisory letter from, or has adopted any 
extraordinary board resolution at the request of, any Governmental Authority 
charged with the supervision or regulation of banks or bank holding companies 
or engaged in the insurance of thrift deposits which would have a material 
adverse effect on the Purchaser's ability to perform its obligations under 
this Agreement.

          SECTION 4.06.  Absence of Litigation.  There are no claims, actions,
proceedings or investigations pending or, to the Purchaser's knowledge, 
threatened against the Purchaser, Marine Midland Bank or any subsidiary of 
Marine Midland Bank, or any of its or their assets or properties, before any 
court, arbitrator or administrative, governmental or regulatory authority 
which seek to delay, prevent or restrict the consummation of the transactions 
contemplated hereby.

          SECTION 4.07.  Securities Law.  The Purchaser understands and agrees
that it may not sell or dispose of any of the CTUS Shares or the Company Shares
other than pursuant to an effective registration statement under the 
Securities Act of 1933, as amended, or pursuant to an available exemption 
therefrom.

          SECTION 4.08.  Financing.  The Purchaser currently has, and at the
Closing will continue to have, all funds necessary to satisfy all of its 
obligations hereunder and to consummate the transactions contemplated by 
this Agreement on the terms set forth herein, and its ability to consummate 
such transactions is not dependent or conditional upon receipt of financing 
from any third party.

          SECTION 4.09.  Community Reinvestment Act.  Marine Midland Bank
received a rating of "satisfactory" in its most recent examination with 
respect to the CRA.  Marine Midland Bank has not been notified in writing 
with respect to supervisory concerns regarding its compliance with the CRA 
or, to the extent applicable, the New York Community Reinvestment Act.    

          SECTION 4.10.  Brokers.  No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection 
with the transactions contemplated by this Agreement based upon arrangements 
made by or on behalf of the Purchaser or any of its affiliates. 

                                 ARTICLE V

                           ADDITIONAL AGREEMENTS

          SECTION 5.01.  Conduct of Business Prior to the Closing.  (a)  Except
as otherwise provided or contemplated herein or in Section 5.01(a) of the 
Seller Disclosure Schedule, the Seller agrees that, between the date hereof and
the Closing Date and without the prior written consent of the Purchaser:

          (i)  it will not permit CTUS, the Company or the Subsidiaries to
     conduct their Businesses other than in all material respects in the 
     ordinary course and consistent with prior practice;

          (ii) it will cause CTUS, the Company and each Subsidiary to use
     reasonable efforts to preserve substantially intact the business 
     organization of their respective Businesses, to keep available to the 
     Purchaser the services of the employees of the Company and each 
     Subsidiary (but the Seller shall have no liability to the Purchaser for 
     the failure to keep the services of any employees who voluntarily 
     resign from employment by the Company or the Subsidiaries) and to
     use reasonable efforts to preserve the current relationships with their 
     respective customers, suppliers and other persons with which they have 
     significant business relationships;

          (iii) it will not permit CTUS, the Company or any Subsidiary to amend
     their respective charters, by-laws or similar organizational documents or 
     merge or consolidate, or obligate themselves to do so, with or into any 
     other entity; 

          (iv) it will not permit either CTUS, the Company or a Subsidiary:  
     (x) to change its accounting methods, principles or practices (other than 
     such changes required by GAAP or by applicable Law), (y) to establish or 
     increase any bonus, insurance, severance, deferred compensation, pension, 
     retirement, profit sharing, stock option (including, without limitation, 
     the granting of stock options, stock appreciation rights, performance 
     awards, or restricted stock awards), stock purchase or other employee 
     benefit plan, or otherwise increase the compensation payable or to become 
     payable to any officers or employees of either CTUS, the Company or a
     Subsidiary, except in the ordinary course of business consistent with
     past practice or as may be required by applicable Law or applicable 
     collective bargaining agreements or (z) enter into any employment or 
     severance agreement with any of its employees or establish, adopt, enter 
     into or amend any collective bargaining agreement; and 

          (v)  it will not permit CTUS, the Company or a Subsidiary to adopt any
     new Plan or to amend, modify or terminate any Plan (or commit, promise or
     communicate any intention to adopt any new Plan or amend, modify or 
     terminate any Plan), except as may be required by Law.

          (b)  Notwithstanding anything to the contrary in this Agreement and 
for the purpose of facilitating the establishment or maintenance of an insured 
depository institution and operation of a thrift or banking business in the 
United States, at any time on or prior to the Closing, CTUS may, with the 
consent of the Purchaser (which consent shall not be unreasonably withheld), 
but subject to compliance with all applicable Law, cause the Company to either 
(i) sell, transfer, assign or otherwise dispose of, to the Seller, or such of 
the Seller's Affiliates as the Seller shall have the right to determine up 
to U.S.$5,000,000 in fair market value of mortgage and other residential 
real estate or similar assets of the Company identified by the Seller together 
with the assumption by any such transferee of an equivalent amount of 
non-deposit liabilities of the Company so long as, after giving effect to 
the foregoing, the Book Value of the Company shall not be diminished by an 
amount greater than U.S.$5,000,000 from the amount thereof immediately prior 
to any such action or (ii) sell, transfer, assign or otherwise dispose of
all of the Company's assets and liabilities to a newly-established insured 
depository institution to be owned by CTUS (other than the limited amount of 
assets and liabilities contemplated in the preceding clause (i) and the FIRREA 
Claim) and thereafter transfer ownership of all of the Company Shares to the 
Seller and/or such of the Seller's Affiliates as the Seller may designate, 
in which event the purchase and sale contemplated hereunder shall, without 
any further action on the part of the parties hereto, be deemed to be amended 
to relate solely to the CTUS Shares and, indirectly, the shares of the
newly-established insured depository institution contemplated herein. 

          SECTION 5.02.  Investigation.  (a)  The Purchaser acknowledges and
agrees that it (i) has made its own inquiry and investigation into, and, based 
thereon, has formed an independent judgment concerning, CTUS, the Company and 
the Subsidiaries, (ii) has been furnished with or given adequate access to 
such information about CTUS, the Company and the Subsidiaries and the 
respective Businesses of CTUS, the Company and the Subsidiaries as it has 
requested, and (iii) will not assert any claim against the Seller, CTUS or 
the Company (except as contemplated or otherwise permitted by this Agreement) 
or any of their directors, officers, employees, agents, stockholders, 
affiliates, consultants, investment bankers, attorneys or representatives, 
or hold the Seller, CTUS or the Company or any such persons liable, for any 
inaccuracies, misstatements or omissions with respect to information (other 
than, in the case of the Seller, with respect to the representations, warranties
and information contained in this Agreement, including the Seller Disclosure 
Schedule or in any certificate or other document delivered to the Purchaser 
which certificate or other document was prepared in connection with the sale 
of the CTUS Shares) furnished by the Seller or such persons concerning the 
Seller, CTUS, the Company and the Subsidiaries or the Businesses of CTUS, the
Company and the Subsidiaries.

          (b)  In connection with the Purchaser's investigation of CTUS, the
Company and the Subsidiaries and the Businesses of CTUS, the Company and the
Subsidiaries, the Purchaser received from the Seller certain estimates, 
projections and other forecasts for CTUS, the Company and the Subsidiaries, 
and certain plan and budget information.  The Purchaser acknowledges that 
there are uncertainties inherent in attempting to make such estimates, 
projections, forecasts, plans and budgets, that the Purchaser is familiar 
with such uncertainties, that the Purchaser is taking full responsibility 
for making its own evaluation of the adequacy and accuracy of all estimates, 
projections, forecasts, plans and budgets so furnished to it, and that the
Purchaser will not assert any claim against the Seller or any of its 
affiliates or any of their directors, officers, employees, agents, 
stockholders, affiliates, consultants, investment bankers, attorneys or 
representatives, or hold the Seller or any such persons liable with respect 
thereto except as otherwise permitted under Section 10.03.  Accordingly, the
Seller makes no representation or warranty with respect to any estimates, 
projections, forecasts, plans or budgets referred to in this section other 
than as contemplated in Sections 3.08 and 3.09. 

          SECTION 5.03.  Access to Information.  (a)  From the date hereof until
the Closing Date, upon reasonable notice, the Seller shall, and shall cause 
CTUS and each of CTUS', the Company's and the Subsidiaries' officers, 
directors, employees, auditors and agents to, (i) afford the officers, 
employees and authorized agents and representatives of the Purchaser reasonable 
access, during normal business hours, to the offices, properties, books and 
records of CTUS, the Company and the Subsidiaries and (ii) furnish to the 
officers, employees and authorized agents and representatives of the Purchaser 
such additional financial and operating data and other information regarding 
the assets, properties, goodwill and Business of CTUS, the Company and the 
Subsidiaries as the Purchaser may from time to time reasonably request; 
provided, however, that such investigation shall not unreasonably interfere 
with any of the Business or operations of the Seller, CTUS, the Company, the 
Subsidiaries or any Affiliate of the Seller; and provided further that the 
Seller, CTUS, the Company and any Subsidiary shall not be required to breach 
or violate any confidentiality obligation contained in a written agreement, 
binding on any of the Seller, CTUS, the Company and any Subsidiary.

          (b)  In order to facilitate the resolution after the Closing of any 
claims made by or against or incurred by the Seller prior to the Closing 
arising out of or relating to its ownership of CTUS, the Company or any of 
the Subsidiaries, the Purchaser shall (i) afford the officers, employees and 
authorized agents and representatives of the Seller reasonable access, during 
normal business hours, to the offices, properties, books and records of the 
Purchaser, CTUS, the Company and the Subsidiaries, (ii) furnish to the officers,
employees and authorized agents and representatives of the Seller such 
additional financial and other information regarding CTUS, the Company and the 
Subsidiaries and the Businesses of CTUS, the Company and the Subsidiaries as 
the Seller may from time to time reasonably request and (iii) to the extent 
it does not unreasonably interfere with the discharge of their regular duties
make available to the Seller, the employees of CTUS, the Company and the 
Subsidiaries whose assistance, testimony or presence is necessary to assist 
the Seller in evaluating any such claims and in defending such claims, 
including the presence of such persons as witnesses in hearings or trials 
for such purposes; provided, however, that such investigation shall not 
 unreasonably interfere with the business or operations of the Purchaser, 
CTUS, the Company, the Subsidiaries or any Affiliate of the Purchaser or in
the case of CTUS, the Company and the Subsidiaries, their respective successors;
provided further that the Seller shall pay all out-of-pocket costs of the 
Purchaser, CTUS, the Company, the Subsidiaries or in the case of CTUS, the 
Company and the Subsidiaries, their respective successors and such employees 
incurred in connection with any such investigation and shall reimburse the 
Purchaser, CTUS, the Company, the Subsidiary or in the case of CTUS, the 
Company and the Subsidiaries, their respective successors by which each such 
employee is employed on a per diem basis based on the annual salary and 
benefits, fully costed, of all employees if, in the aggregate, such employees 
are required to devote more than fifty hours to responding to requests from
the Seller pursuant to this Section 5.03(b).

          SECTION 5.04.  Books and Records.  (a)  From the Closing Date until 
six years from the Closing Date or such longer period, if any, as is required 
by applicable Law relating to the Businesses and activities of CTUS, the 
Company and the Subsidiaries, the Purchaser agrees that it shall preserve and 
keep all books and records of CTUS, the Company and the Subsidiaries relating 
to the Pre-Closing Period.  Prior to expiration of six years from the Closing 
Date, before disposing of any of such books and records, the Purchaser shall 
give the Seller at least 90 calendar days' prior written notice of the 
proposed destruction specifying in reasonable detail in the manner currently
employed by the Company to catalog their books and records the books and 
records to be disposed of, and the Seller shall be given an opportunity, at 
its cost and expense, to remove and retain all or any part of such books and 
records as the Seller may select.  During such 90-day period, duly authorized 
representatives of the Seller shall, upon reasonable notice, have access 
thereto during normal business hours to examine, inspect and copy such books 
and records.

          (b)  If, in order properly to prepare documents required to be filed 
with Governmental Authorities or its financial statements, it may be necessary 
that either of the parties hereto or any successors be furnished with additional
information relating to CTUS, the Company and the Subsidiaries or their 
respective Businesses, and such information is in the possession of the other 
party hereto, such party agrees to use its best efforts to furnish such 
information to such other party, at the cost and expense of the party being 
furnished such information.

          SECTION 5.05.  Confidentiality.  (a)  The terms of the letter 
agreement dated as of June 17, 1996 (the "Confidentiality Agreement") between 
Merrill Lynch, on behalf of the Seller, and the Purchaser are hereby 
incorporated by reference and shall continue in full force and effect, except 
as inconsistent with the terms of this Agreement and provided that, if this 
Agreement shall terminate, as provided herein, the Confidentiality Agreement 
shall remain in full force and effect.

          (b)  Except to the extent disclosure is required by Law, or in 
response to any governmental or regulatory authority, or in connection with 
any litigation relating to an alleged breach of this Agreement, each party 
shall maintain the confidentiality of all information obtained from the other 
party hereto other than information that is otherwise publicly available and 
shall use such information only for purposes reasonably related to this 
Agreement and the transactions contemplated hereby.  If this Agreement is 
terminated, each of the parties hereto agrees to return promptly upon request 
all documents received from the other party that contain or embody information 
subject to this paragraph.

          (c)  The Seller acknowledges that, from and after the Closing, all
proprietary and confidential information of CTUS, the Company and the 
Subsidiaries shall be and become the property of the Purchaser, and the Seller 
agrees that it will not, and it will not permit any of its Affiliates to, use 
or disseminate such information for any purpose whatsoever.

          SECTION 5.06.  Authorizations; Consents and Notices.  (a)  Each party
hereto shall use reasonable efforts to obtain all authorizations, consents, 
orders and approvals of, and to give all notices to and make all filings with, 
all Governmental Authorities and other third parties that may be or become 
necessary for such party's execution and delivery of, and the performance of 
such party's obligations pursuant to, this Agreement and will cooperate fully 
with the other party in promptly seeking to obtain all such authorizations, 
consents, orders and approvals, giving such notices, and making such filings.  
The Purchaser acknowledges that it shall be solely responsible for obtaining 
the Purchaser's Required Approvals, and the Seller agrees to use reasonable 
efforts to assist the Purchaser in obtaining the Purchaser's Required 
Approvals on or prior to the Closing Date.  The Seller acknowledges that it 
will be solely responsible for obtaining the Seller's Required Approvals and 
the Purchaser agrees to use reasonable efforts to assist the Seller in 
obtaining the Seller's Required Approvals on or prior to the Closing Date.  
The parties hereto acknowledge that time shall be of the essence in this
Agreement and agree not to take any action that will have the effect of 
unreasonably delaying, impairing or impeding the receipt of any required 
authorizations, consents, orders or approvals.

          (b)  The Purchaser and its subsidiaries will use reasonable efforts to
assist the Seller in obtaining at or prior to the Closing any consents of third 
parties (other than Governmental Authorities) under any lease or contract to 
which the Company or any Subsidiary is a party, which consent is in the 
reasonable judgment of the Seller necessary or advisable in connection with 
the transactions contemplated by this Agreement, including, without limitation, 
(i) providing to such third parties (A) guarantees by the Purchaser of the 
obligations of CTUS, the Company or any Subsidiary under the subject lease or 
contract and (B) such financial statements and other financial information 
with respect to the Purchaser as such third parties may reasonably request
and (ii) agreeing to such adjustments to the terms of the subject lease or 
contract as would not, individually or in the aggregate, have a Material 
Adverse Effect.

          SECTION 5.07.  Pre-Closing Payments.  At or prior to the Closing Date,
the Seller shall have the right, and shall have the right to cause CTUS, the 
Company and the Subsidiaries, to terminate all of the Intercompany Obligations, 
it being understood that (a) at the Seller's discretion the Seller shall (to 
the extent permitted by applicable Law and regulation) cause the Company to 
pay an extraordinary dividend to CTUS at least sufficient to allow CTUS to 
satisfy or repay any Intercompany Obligations and, subject to regulatory 
approval, to pay a dividend such that, after giving effect thereto, the
Book Value as of the date which is expected to be the Audit Date is not less 
than the Agreed Minimum Audit Date Book Value on such date and (b) to 
facilitate the transactions contemplated herein, the Seller may, but shall 
not be obligated to, cause CT North America L.L.C. to forgive, convert or 
otherwise restructure in accordance with applicable Law the intercompany debt 
in an amount of approximately U.S.$82,200,000 owed to it by CTUS so long as 
the foregoing shall result in an increase to the Book Value of CTUS in an 
amount not less than the aggregate outstanding principal amount of such debt 
and any accrued interest thereon; provided, however, that (i) the Seller shall
give the Purchaser five Business Days' prior written notice of any transaction 
described in this Section 5.07 specifying in reasonable detail the actions to 
be taken, (ii) after giving effect to the transactions described in such 
notice, the Book Value of CTUS shall be the Agreed Minimum Audit Date Book 
Value on such date and (iii) any Taxes arising from the payment of any dividend 
or the forgiveness, conversion or restructuring of any debt as contemplated 
in this Section 5.07 shall be expressly deemed to accrue, arise and be payable 
during a Pre-Closing Period.

          SECTION 5.08.  Notice of Events.  The Seller and the Purchaser shall
promptly notify each other of any event or circumstance which shall occur prior 
to the Closing which shall constitute a breach of a representation or warranty 
or a covenant or agreement of either the Seller or the Purchaser, such that it 
is reasonably likely that the conditions set forth in Section 8.01(a) or 
Section 8.02(a), as the case may be, will be incapable of being satisfied by 
the Closing Date.

          SECTION 5.09.  FIRREA Claim.  (a)  Assuming that the action 
contemplated in Section 5.01(b)(ii) shall not have been taken and 
notwithstanding anything herein to the contrary, the parties hereto agree (i) 
that any recovery (the "FIRREA Recovery") on the litigation filed by the 
Company in the United States Court of Claims styled First Federal Savings 
and Loan Association of Rochester v. United States, No. 95-517C (Ct. Cl. 
filed August 7, 1995), and any claim, right or administrative or judicial 
proceeding comprising, arising out of, or resulting from, that litigation (any
such claim, right or proceeding is referred to herein as the "FIRREA Claim") 
shall be for the account of the Seller, (ii) that the Seller shall have the 
sole and exclusive right to direct the prosecution of the FIRREA Claim as 
hereinafter provided, (iii) that the Purchaser, the Company and/or any 
successor-in-interest thereto which holds the FIRREA Claim (the "FIRREA 
Plaintiff") shall take all action reasonably requested by the Seller from 
time to time with respect to the FIRREA Claim, it being understood and
agreed that, in furtherance thereof, the FIRREA Plaintiff's actions shall be 
subject to the conditions set forth in Exhibit 5.09(e), (iv) that the FIRREA 
Plaintiff shall be under no obligation whatsoever to take any action in 
respect of the FIRREA Claim in the absence of direction from the Seller, 
(v) that the FIRREA Plaintiff shall take no action subsequent to the Closing
with respect to the FIRREA Claim that reasonably can be expected to adversely 
affect the likelihood, timing, nature, or amount of any such recovery and 
(vi) that the Seller shall pay all costs and expenses of prosecution of the
FIRREA Claim at the direction of the Seller, including, without limitation, 
all costs and expenses of the FIRREA Plaintiff, the Purchaser or any 
subsidiary of the Purchaser incurred in connection therewith, including, 
without limitation, all fees and disbursements of counsel to the FIRREA 
Plaintiff chosen by Seller as provided in Section 5.09(d).

          (b)  In furtherance of the foregoing (and without in any way 
intending to limit the right and ability of the Seller and the Purchaser to 
consider and agree on other appropriate courses of action, including any 
action or arrangement that is intended to maximize or preserve the value of 
the FIRREA Claim to the Seller, by, among other things, requiring that the 
FIRREA Plaintiff hold the FIRREA Recovery in trust for the benefit of the 
holder of the Preferred Stock), the Purchaser understands and agrees that,
prior to consummation of the transactions contemplated hereby, the Seller 
may cause CTUS to amend its organizational documents to provide for the 
issuance of, and to cause CTUS to issue by way of dividend or otherwise, 
shares of a new class of non-voting preferred stock (the "Preferred Stock") 
having terms and conditions as set forth in Exhibit 5.09(b), including, 
without limitation, terms that require CTUS (or any successor-in-interest):  
(i) (A) to pay a dividend on the Preferred Stock in an amount equal to the
aggregate amount of any cash received by the FIRREA Plaintiff as part of 
the FIRREA Recovery, (B) to make a distribution in kind on the Preferred 
Stock of any non-cash property, right or benefit received by the FIRREA 
Plaintiff as part of the FIRREA Recovery which can be transferred to the 
Seller without impairment in value and (C) to pay a dividend on the 
Preferred Stock, but only at the time actually realized by the FIRREA 
Plaintiff and only in the aggregate amount of the actual proceeds (net of 
any costs of sale incurred with the consent of the Seller) or benefit of 
any non-cash property, right or benefit received by the FIRREA Plaintiff as 
part of the FIRREA Recovery which cannot be transferred to Seller, without 
impairment in value, as determined by an independent internationally 
recognized investment bank mutually chosen by the Seller and the FIRREA 
Plaintiff, in each case net of any applicable Taxes, the amount of
which shall be computed at the maximum applicable marginal statutory tax 
rate in effect at the time of the FIRREA Recovery (the "Preferred Stock 
Dividend Amount") (which amount or in-kind distribution shall be subject to 
any applicable withholding taxes); and (ii) to redeem the Preferred Stock 
at par value plus the amount by which the Preferred Stock Dividend Amount 
exceeds any dividends paid or in kind distributions made on the Preferred 
Stock prior to redemption (the "Preferred Stock Redemption Amount");
provided that the terms and conditions of the Preferred Stock shall be 
substantially in conformity with the terms and conditions set forth in 
Exhibit 5.09(b) or otherwise reasonably acceptable to the Purchaser.  
Notwithstanding the foregoing, (x) at any time prior to the Closing, the 
Company shall have the right, without the consent of the Purchaser, to 
transfer the FIRREA Claim to the Seller, any of its Affiliates or a newly-
created or existing Subsidiary of the Company and the right to transfer the 
shares of any such Subsidiary to the Seller, or any of its Affiliates and 
(y) at any time following the Closing, at the request of the Seller, the 
Purchaser shall transfer or cause the FIRREA Plaintiff to transfer the 
FIRREA Claim to the Seller or such Affiliate of the Seller as the Seller 
shall designate and, in either case, the Purchaser agrees that subject to 
clauses (iii), (iv) and (vi) of paragraph (a) above, following the Closing 
and for so long as the FIRREA Plaintiff is a subsidiary of the Purchaser it 
shall and shall cause the FIRREA Plaintiff, CTUS and/or the appropriate 
Subsidiaries to cooperate fully (including joining as a party) in the 
prosecution of the FIRREA Claim. 

          (c)  Pursuant to the terms and conditions of the Preferred Stock, 
on the first Business Day following the later of (i) 30 days after the receipt
of the FIRREA Recovery by the FIRREA Plaintiff and (ii) 90 days after the 
commencement of the taxation year of the FIRREA Plaintiff in which the FIRREA 
Recovery is received, CTUS shall declare and pay a cash dividend or make a 
distribution in-kind on the Preferred Stock as provided above and shall pay 
any cash by wire transfer in immediately available funds to one or more 
accounts designated by the holder(s) of the Preferred Stock and make any 
in-kind distribution in a commercially reasonable manner.  If the amount of 
any FIRREA Recovery is reduced due to any set off, counterclaim, or other
reduction successfully asserted by the U.S. Government against the FIRREA 
Plaintiff arising out of a claim (i) against the FIRREA Plaintiff or any of 
its Affiliates unrelated to the FIRREA Claim and (ii) in the case of a claim 
against the Company, relating to a period or events following the Closing 
Date, in addition to the payments and distributions otherwise contemplated to 
be paid or made by the issuer of the Preferred Stock pursuant to this 
paragraph (c), the amount includable in the Preferred Stock Dividend Amount 
shall, notwithstanding anything hereto to the contrary, be increased by
an amount equal to the amount of such set off, counterclaim or other 
reduction at the time and in the manner of such other payments made by CTUS 
pursuant to this paragraph (c).

          (d)  So long as, following the Closing, the FIRREA Claim shall be held
in the name of the FIRREA Plaintiff, (i) the Seller shall have the right to 
direct the FIRREA Plaintiff with respect to the prosecution of the FIRREA 
Claim, through counsel of the Seller's own choosing, at the Seller's own 
expense, and (ii) the FIRREA Claim shall not be collected, settled, compromised,
abandoned or otherwise resolved by the FIRREA Plaintiff except on terms and 
conditions to which the Seller shall have provided its express written consent. 
Subject to clauses (iii), (iv) and (vi) of paragraph (a) above, the Purchaser 
shall cooperate fully and, following the Closing, for so long as the FIRREA 
Plaintiff is a subsidiary of the Purchaser, shall cause the FIRREA Plaintiff,
CTUS and/or the appropriate Subsidiaries to cooperate fully (including joining 
as a party) in the prosecution of such FIRREA Claim with the Seller.  For so 
long as the FIRREA Plaintiff is a subsidiary of the Purchaser, the Purchaser 
shall promptly empower, and shall cause the FIRREA Plaintiff promptly to empower
(by power of attorney and such other documentation as may be necessary and 
appropriate), such representatives of the Seller as the Seller may designate to 
represent the FIRREA Plaintiff in the FIRREA Claim, including the power to 
enter into any settlement or compromise concerning such claim.

          SECTION 5.10.  No Solicitation.  Except for the individuals listed on
Section 5.10 of the Seller's Disclosure Schedule, the Seller agrees that, from 
the date hereof until the expiration of the two-year period following the 
Closing (a) the Seller shall not, directly or indirectly, solicit or induce 
any employee of CTUS, the Company or the Subsidiaries to leave such employment 
and become an employee of the Seller or any of its Affiliates and (b) the 
Purchaser, CTUS, the Company and the Subsidiaries shall not, directly or 
indirectly, solicit or induce any employee of the Seller or any Affiliate of 
the Seller to leave such employment and become an employee of the Purchaser, 
CTUS, the Company or the Subsidiaries or any of their Affiliates; provided, 
however, that nothing in this Section 5.10 shall prohibit the Seller or any 
of its Affiliates or the Purchaser, CTUS, the Company or the Subsidiaries or 
any of their Affiliates from employing any person (i) who contacts them on 
his or her initiative and without any direct or indirect solicitation by the 
Seller or any of their Affiliates or the Purchaser, CTUS, the Company or the 
Subsidiaries or any of their Affiliates, as the case may be, or (ii) after 
expiration of the two-year period following the Closing Date.

          SECTION 5.11.  Covenant Not to Compete.  The Seller and its 
subsidiaries shall not (a) for a three-year period following the date hereof, 
establish a savings and loan association operating in the Non-Compete Area, 
(b) utilize the name or current logos of the Company or use in any way any 
proprietary customer list or other similar record of the Company as of the 
Closing Date or (c) for a three-year period commencing on the date hereof, 
open or establish any new permanent offices or branches of a physical nature 
or any physical proprietary ATM system (which for greater certainty excludes 
any shared electronic, telephonic or computer-related networks, ATM system,
Interac or internet systems ("Electronic Networks")) for deposit-gathering 
activities within the Non-Compete Area; provided, however, that nothing 
herein shall in any way limit the ability of the Seller or any of any such 
subsidiaries, including, without limitation, any new savings and loan 
association, savings bank, commercial bank or commercial or consumer lending 
company hereafter established by or for the benefit of the Seller or any of its
Affiliates, to (w) establish a permanent head office or other place of business
within the Non-Compete Area, but only if required for the Seller to obtain a 
license or charter to establish and/or operate an insured depository 
institution (as defined in the FDIA) to enable the Seller, in its discretion, 
to continue to operate a banking or thrift business in the United States, or 
(x) subject to compliance with clause (b) above, solicit deposits
from any location outside the Non-Compete Area by any means or from within the
Non-Compete Area by electronic means, computer-related or telephonic activity, 
whether or not through Electronic Networks, or (y) subject to compliance with 
clause (b) above, offer or solicit loans or other financial products or other 
services whether or not within the Non-Compete Area or (z) acquire any Person 
that has an existing permanent office, branch or branches of a physical nature 
or physical proprietary ATM system (excluding any Electronic Networks) for 
deposit-gathering, lending or other financial services activities within the 
Non-Compete Area which competes with the Company within the Non-Compete Area.  
Notwithstanding the foregoing, (A) in the event of an assignment contemplated 
in Section 10.13, the restriction imposed by this Section 5.11 shall not bind
the assignee but shall continue solely to bind CT Financial Services, Inc. 
and its subsidiaries and (B) the restriction imposed on the Seller and its 
subsidiaries under this Section 5.11 shall automatically cease to be of any 
further force and effect and the Seller and its subsidiaries shall have no 
further obligation hereunder to the Purchaser or any of its subsidiaries in 
the event that at any time during such three-year period from the date
hereof: 

          (i)  there is a "change in control" of the Seller, Canada Trustco
     Mortgage Company or The Canada Trust Company (whether directly or 
     indirectly through a change in control of the direct or indirect 
     controlling shareholder of the Seller, Canada Trustco Mortgage Company 
     or the Canada Trust Company) which shall be deemed to have occurred if 
     any Person or combination of Persons other than a Person currently 
     controlling any of the foregoing through any transaction or series of 
     transactions (whether by purchase, merger, consolidation, amalgamation 
     or otherwise) beneficially acquiring, directly or indirectly, (x) 75%
     or more of the issued and outstanding voting securities or shares of 
     the Seller or The Canada Trust Company, or (y) 75% or more of the issued 
     and outstanding voting securities or shares of Canada Trustco Mortgage 
     Company until such date (currently June 1, 1997) as the Canada Trustco 
     Mortgage Company is required to satisfy the 35% or other specified 
     public voting requirement (the "Public Voting Requirement") under the 
     Loan and Trust Companies Act (Canada) or (z) after the satisfaction of 
     the Public Voting Requirement, 65% (or such other percentage of voting 
     shares remaining after the Public Voting Requirement has been met) of
     the issued and outstanding voting securities or shares of Canada Trustco 
     Mortgage Company; or 

          (ii) there is a sale, transfer, assignment or other disposition of 
     all or substantially all of the assets of the Seller, Canada Trustco 
     Mortgage Company or The Canada Trust Company through any transaction or 
     a series of transactions to a Person or combination of Persons other 
     than a Person currently controlling any of the foregoing.

          SECTION 5.12.  Environmental Audit.  Between the date hereof and the
Closing Date, in the event that, at the time of foreclosure on any real property
securing any loan, the Seller has actual knowledge that any Chemical Substance 
was or is present, manufactured, generated, used, recycled, reclaimed, released,
stored, treated or disposed of at, in or from such property, the Seller shall 
(a) provide notice thereof to the Purchaser, (b) at the written request and 
expense of the Purchaser, conduct an environmental audit prior to foreclosure 
to the extent that doing so will not adversely affect such foreclosure and 
(c) provide the results of such audit to, and consult with, the Purchaser 
regarding the significance of such audit prior to foreclosure on any such 
property.

          SECTION 5.13.  Minority Shares.  Between the date hereof and the
Closing Date, the Seller shall attempt to enter into such arrangements and/or
agreements with the holders of the Minority Shares listed in Section 3.21 of 
the Seller Disclosure Schedule, on terms disclosed or made available to the 
Purchaser, as shall be necessary for CTUS to acquire at its sole cost and 
expense all of the outstanding Minority Shares as of the Closing Date.

          SECTION 5.14.  Merger Structure.  The Seller and the Purchaser agree
within 30 days following the date hereof to attempt to restructure the 
transaction as a merger of CTUS with a wholly-owned subsidiary of the Purchaser 
and a merger of the Company with and into Marine Midland Bank, it being 
understood that (a) the Seller shall have no obligation to do so unless it 
shall, in its sole discretion, have determined that any such restructuring 
will not materially increase its Tax liabilities resulting from the 
consummation of the stock purchase transaction (including the issuance of the
Preferred Stock) provided for in this Agreement and (b) subject to the 
foregoing, both mergers shall be subject to approval by the respective boards 
and will only be effective contemporaneously with the Closing, but shall be 
on the following basis:

          (i)  The acquisition of CTUS by the Purchaser shall be effected 
     through the following transactions:  (A) on the Closing Date a wholly-owned
     subsidiary of the Purchaser (the "Merger Subsidiary") shall merge with and 
     into CTUS (the "Merger"); and (B) the Company shall, simultaneously with 
     the Merger or thereafter, merge with and into Marine Midland Bank, a 
     wholly-owned subsidiary of the Purchaser (the "Bank Merger"); 

          (ii) On the Closing Date, the Merger shall be effected by the Merger
     Subsidiary merging with and into CTUS, with CTUS being the surviving
     corporation (the "Surviving Corporation").  The separate corporate 
     existence of the Merger Subsidiary shall thereupon cease, and the Surviving
     Corporation shall thereupon become a wholly-owned subsidiary of the 
     Purchaser.  The Surviving Corporation shall continue to be governed by 
     the laws of Delaware, and its separate corporate existence with all of 
     its rights, privileges, immunities, powers and franchises shall continue 
     unaffected by the Merger.  At the Closing Date, the certificate of 
     incorporation and by-laws of CTUS in effect immediately prior to the 
     Closing Date shall continue to be the certificate of incorporation and 
     by-laws of the Surviving Corporation.  At the Closing Date, the 
     directors and officers of the Merger Subsidiary shall become the sole 
     directors and officers of the Surviving Corporation; and

          (iii) The Bank Merger shall be effected pursuant to the terms of an
     agreement and plan of merger substantially on terms attached hereto as
     Exhibit 5.14(c), as agreed to by the parties within 30 days of the date 
     hereof.

          SECTION 5.15.  FIRTPA Certificate.  The Seller shall provide the
Purchaser with a certificate that, as of the Closing Date, the CTUS Shares 
do not constitute a U.S. real property interest within the meaning of Section 
1445 of the Code, such certification to satisfy the requirements of Treasury 
regulation Sections 1.897-2(h) and 1.1445-2(c)(3).  If such certificate is 
not received, the Purchaser shall be entitled to withhold 10 percent of the 
purchase price as required by Section 1445 of the Code.

          SECTION 5.16.  Further Assurances.  Each party shall cooperate with 
the other, and execute and deliver, or use its best efforts to cause to be 
executed and delivered, all such other instruments, including instruments of 
conveyance, assignment and transfer, and take all such other actions 
consistent with the terms of this Agreement, as such party may reasonably be 
requested to take by the other party hereto from time to time, in order to 
effectuate the provisions and purposes of this Agreement and the transactions 
contemplated hereby.

          SECTION 5.17.  Transition.  Each party shall cooperate with the other
during the period from the date hereof to the Closing Date to effectuate the 
purposes of this Agreement and the transactions contemplated hereby and shall 
negotiate in good faith and in a commercially reasonable manner to resolve any 
issues which may arise during such period in order to enable the transactions 
contemplated hereby to be consummated.

                                ARTICLE VI

                             EMPLOYEE MATTERS

          SECTION 6.01.  Provision of Comparable Benefits.  (a)  The Purchaser
agrees that, for a period of one year after the Closing Date, the Purchaser 
shall (or shall cause any other appropriate subsidiary of the Purchaser to) 
provide each employee and each former employee of the Company and the 
Subsidiaries who was an employee of the Company or the Subsidiaries on the 
Closing Date with benefits (including, without limitation, welfare benefits) 
that are comparable in the aggregate, in the good faith determination of the 
Purchaser, to the benefits generally provided by the Purchaser to its own 
similarly situated employees.  Consistent with providing comparable benefits 
for one year as is set forth above, nothing in this Section shall affect the 
Purchaser's ability to determine the benefits to provide to any employee or 
former employee, or restrict the Purchaser's ability to terminate, modify or 
amend any Plan, program, arrangement or fringe benefit or to terminate, 
modify or amend the terms and conditions of employment of any individual.  
In no event shall the arrangements set forth herein in any way remove or 
diminish the Purchaser's obligation to comply with, and to provide benefits to 
the extent required by, Section 4980B of the Code with respect to any former 
employee of the Company or its Subsidiaries.

          (b)  With regard to those former employees of the Company or the
Subsidiaries who are receiving retiree health benefits as of the Closing Date,
for a period of one year following the Closing Date, the Purchaser agrees to 
elect either to continue the retiree health benefits such former employees 
were receiving immediately prior to the Closing Date or to provide such former 
employees with the retiree health benefits provided from time to time to 
similarly situated retirees of the Purchaser.

          (c)  To the extent service is relevant for vesting or benefit 
calculations or allowances (including, without limitation, entitlement to 
vacation and sick days) under any plan or arrangement maintained by the 
Purchaser in which employees or former employees of the Company or 
Subsidiaries who were employed by the Company or the Subsidiaries on the 
Closing Date participate, and to the extent permitted by applicable Law, in 
order to provide the benefits described in paragraph (a) above, such plan or
arrangement shall credit employees with service on or prior to the Closing 
Date with the Company or any of the Subsidiaries, if and to the same extent 
such service was credited under comparable plans of the Company or the 
Subsidiaries prior to the Closing Date in which such employees participated; 
provided, however, that the Purchaser shall have the right to offset the 
amount of any accrued benefit under any of the Purchaser's defined benefit 
pension plans in which an employee participates, by the accrued benefit under
any defined benefit pension plan sponsored by the Company or its Subsidiaries
as of the Closing Date.  Nothing herein shall require any such service to be 
credited to the extent it would result in an employee receiving duplicate 
benefits.

          SECTION 6.02.  Succession.  In the event the Purchaser, CTUS, the
Company or any of the Subsidiaries or any of their respective successors or 
assigns (i) consolidates with or merges into any other person and shall not be 
the continuing or surviving corporation or entity of such consolidation or 
merger or (ii) transfers all or substantially all of its properties and assets 
to any person, then, and in each such case, proper provision shall be made 
so that the successors and assigns of the Purchaser, CTUS, the Company or 
the Subsidiaries, as the case may be, shall assume the obligations set forth 
in this Article VI.

          SECTION 6.03.  Survival.  This Article VI shall survive the Closing as
provided in Section 10.01.

                                ARTICLE VII

                                TAX MATTERS

          SECTION 7.01.  Tax Indemnities.  (a)  Subject to Section 7.01(d), the
Seller shall indemnify the Purchaser and its Affiliates and hold them 
harmless from and against any liability for Taxes (other than conveyance taxes, 
which are allocated pursuant to Section 7.06) (i) imposed on CTUS, the Company 
and the Subsidiaries in respect of their income, business, property or 
operations for any Pre-Closing Period, (ii) attributable to any change in 
accounting method employed by CTUS, the Company or any Subsidiary prior to 
the Closing Date, (iii) attributable to discharge of indebtedness, if any, 
that may result from any capital contributions by the Seller (or any Affiliate 
of the Seller) to CTUS, the Company or any Subsidiary of any intercompany 
indebtedness owed by CTUS, the Company or any Subsidiary to the Seller (or any 
Affiliate of the Seller) or (iv) attributable to the issuance or redemption 
of the Preferred Stock and the receipt of the FIRREA Recovery (to the extent 
not taken into account in determining the Preferred Stock Dividend Amount) 
(but only to the extent that the amount of such Taxes is in excess of the 
amount accrued for Taxes (including for greater certainty any reserve for bad 
debts) in the books and records of CTUS, the Company and the Subsidiaries as
of the Closing Date); provided, however, that no indemnity shall be provided 
under this Agreement for any Taxes resulting from (x) a breach by the Purchaser 
of its obligations under this Agreement, (y) a reduction in any net operating 
loss, capital loss or tax credit carryover allocable to CTUS, the Company, or 
any Subsidiary or (z) any transaction of CTUS, the Company or any Subsidiary 
occurring after the Closing on the Closing Date.

          (b)  From and after the Closing Date, the Purchaser, its Affiliates, 
CTUS and the Company shall indemnify the Seller and its Affiliates and hold 
them harmless from and against all Taxes imposed on or with respect to CTUS, 
the Company or its Subsidiaries that are not subject to indemnification pursuant
to paragraph (a) of this Section 7.01.

          (c)  Any Taxes for a Period beginning before the Closing Date and
ending after the Closing Date (a "Straddle Period") shall be apportioned between
the Seller and the Purchaser, in the case of real and personal property taxes, 
and franchise taxes not based on gross or net income, capital (including net 
worth or long-term debt) or gross or net assets, on a per diem basis and, in 
the case of other Taxes (including sale and transfer Taxes not described in 
Section 7.06), shall be determined based on the actual operation of CTUS, the 
Company and the Subsidiaries, as the case may be, during the portion of such 
period that is a Pre-Closing Period and the portion of such period that is a 
Post-Closing Period.  Each such Pre-Closing Period and Post-Closing Period
shall be deemed to be a Period subject to the provisions of Sections 7.01(a) 
and 7.01(b) above.  Notwithstanding the foregoing, in the case of any Tax based 
upon or measured by capital (including net worth or long-term debt), gross or 
net assets or intangibles, the amount of such Tax allocated to the Pre-Closing 
Period shall be computed by reference to the average level of such items during 
the Pre-Closing Period; provided, however, that such method shall apply only 
where the relevant Law requires the use of average amounts and, in such a 
case, the frequency and method of averaging shall be as required by such Law.  
In any other event, the amount of such Tax shall be computed by reference to 
the level of such items on the Audit Date.

          (d)  The respective indemnification obligations of the Purchaser and 
the Seller pursuant to this Section 7.01 shall not be effective until the 
aggregate dollar amount of all Taxes which would otherwise be payable pursuant 
to this Article VII by such party exceeds U.S.$250,000 (the "Tax Liability 
Threshold Amount") and then only to the extent such aggregate amount exceeds 
the Tax Liability Threshold Amount.  

          (e)  Payment by an indemnitor of any amount due under this Section
7.01 shall be made within 30 days following written notice by the indemnitee 
that payment of such amounts to the appropriate tax authority is due, provided 
that the indemnitor shall not be required to make any payment earlier than two 
days before it is due to the appropriate tax authority.  If the Seller receives 
an assessment or other notice of Taxes due with respect to CTUS, the Company 
or any of its Subsidiaries for any Pre-Closing Period for which the Seller 
is not responsible, in whole or in part, pursuant to paragraph (a) of this 
Section 7.01 because all or a part of such Tax does not exceed the amount 
accrued for Taxes in the books and records of CTUS, the Company and its 
Subsidiaries as of the Closing Date, and the Seller pays such Tax, then the 
Purchaser, CTUS or the Company shall pay to the Seller, in accordance with the 
first sentence of this Section 7.01(e), the amount of such Tax for which the 
Seller is not responsible under Section 7.01(a).  In the case of a Tax that is 
contested in accordance with the provisions of Section 7.03, payment of such 
Tax to the appropriate tax authority will not be considered to be due earlier 
than the date of a Final Determination with respect to such Tax.

          SECTION 7.02.  Refunds and Tax Benefits.  (a)  The Purchaser shall
promptly pay to the Seller any refund or credit (including any interest paid or 
credited with respect thereto) received by the Purchaser, CTUS, the Company or 
any Subsidiary of Taxes relating to Pre-Closing Periods or attributable to an 
amount paid by or on behalf of the Seller under Section 7.01 or 5.09 but only 
if and to the extent that the aggregate amount of refunds and credits exceeds 
the aggregate amount that is included as an asset in respect of Taxes on the 
Audit Date Balance Sheet (not taking account of any aggregate valuation 
allowances against deferred tax assets remaining after giving effect to the 
Deferred Tax Valuation Amount (reduced by any Taxes thereon); provided, 
however, that payments with respect to credits shall be made no earlier than 
the time at which such credit reduces or could reduce the Tax liability of the 
Purchaser and its Affiliates, including CTUS, the Company or any Subsidiary.  
In the event that any refund or credit of Taxes for which a payment has been 
made pursuant to this Section 7.02 is subsequently reduced or disallowed, the 
Seller shall indemnify and hold harmless the payor for any Tax liability, 
including interest, assessed against such payor by reason of the reduction or 
disallowance.  The Purchaser shall, if the Seller so requests and at the 
Seller's expense, cause the relevant entity to file for and obtain any refund 
to which the Seller is entitled under this Section 7.02.  Subject to Section 
7.03, the Purchaser shall permit the Seller to control (at the Seller's expense)
the prosecution of any such refund claim, and shall cause the relevant entity 
to authorize by appropriate power of attorney such persons as the Seller shall 
designate to represent such entity with respect to such refund claim.  The 
obligations of the Purchaser pursuant to this Section 7.02(a) shall not be 
effective until the aggregate dollar amount of all amounts refunded and credited
exceeds $250,000, and then only to the extent that such aggregate amount exceeds
$250,000. 

          (b)  In the event and to the extent that the Seller receives a refund
or credit of federal, state or local taxes for any Pre-Closing Period 
attributable solely to the carryback of losses, credits or similar items 
arising in any Post-Closing Period and attributable to CTUS, the Company or 
any Subsidiary, the Seller shall promptly pay to the Purchaser the amount of 
such refund or credit, together with any interest paid or credited with 
respect thereto.  In the event that any refund or credit of Taxes for which a
payment has been made pursuant to this Section 7.02(b) is subsequently 
reduced or disallowed, the Purchaser shall indemnify and hold harmless the payor
for any Tax liability, including interest, assessed by reason of the reduction 
or disallowance.

          (c)  Any amount otherwise payable by the Seller under Section 7.01 
shall be reduced by any Tax benefit realized by the Purchaser, CTUS, the 
Company, any Subsidiary or any of their Affiliates in a Post-Closing Period (a 
"Post-Closing Date Tax Benefit") as a result of either an adjustment to Taxes 
for which the Seller is responsible under Section 7.01 (such as a timing 
adjustment resulting in a Tax deduction for CTUS, the Company or any 
Subsidiary for a Post-Closing Period) or a Tax deduction resulting from an 
indemnifiable payment of Taxes.  The amount of any Post-Closing Date Tax
Benefit shall be computed at the minimum applicable marginal statutory tax 
rate in effect at the time of computation.  Post-Closing Date Tax Benefits 
determined to be substantially likely to be realized not later than the taxable 
year during which an indemnity payment is determined to be due shall be 
considered to be realized currently for purposes of netting against such 
indemnity payment hereunder.  If a payment is made by the Seller in accordance 
with Section 7.01, and if in a subsequent taxable year an actual Post-Closing 
Date Tax Benefit is realized by the Purchaser, CTUS, the Company, any 
Subsidiary or any of their Affiliates (that was not previously taken into 
account pursuant to the preceding sentence to reduce an amount otherwise 
payable by the Seller under Section 7.01), the Purchaser, CTUS, the Company, 
any such Subsidiary or any such Affiliate shall pay to the Seller at the time 
of such realization the amount of such Post-Closing Date Tax Benefit to the 
extent that the Post-Closing Date Tax Benefit would have resulted in a 
reduction in the amount paid by the Seller under Section 7.01 if the 
Post-Closing Date Tax Benefit had been obtained in the year of such payment. 
Subject to the foregoing a Post-Closing Date Tax Benefit will be considered 
to be realized for purposes of this Section 7.02 at the time that it is 
reflected on a Tax return of the Purchaser, CTUS, the Company, any Subsidiary 
or any of their Affiliates.

          SECTION 7.03.  Contests.  (a)  After the Closing Date, the Purchaser 
shall notify the Seller in writing promptly and in any event within 30 days of 
the commencement of any Tax audit or administrative or judicial proceeding or 
of any demand or claim on the Purchaser, CTUS, the Company or a Subsidiary (an
"Indemnification Event"), which could give rise to a claim for indemnification 
under Section 7.01.  Such notice shall contain factual information (to the 
extent known to the Purchaser, CTUS, the Company or a Subsidiary) with respect 
to the Indemnification Event in reasonable detail and shall include copies of 
any notice or other document received from any taxing authority in respect 
thereof.  If the Purchaser fails to give the Seller notice within a reasonable 
period of time or in sufficient detail to apprise the Seller of the nature of 
the claim (in each instance taking into account the facts and circumstances 
with respect to such claim), the Seller shall not be liable under this 
Agreement for such claim to the extent, if any, that the rights of the Seller 
with respect to such claim are actually prejudiced.

          (b)  Subject to Section 7.03(d) below, the Seller may elect to direct,
through counsel of its own choosing and at its own expense, any audit, claim 
for refund and administrative or judicial proceeding involving any Tax Periods 
with respect to which indemnity may be sought from the Seller under Sections 
7.01 or 5.09 (any such audit, claim for refund or proceeding is referred to 
herein as a "Contest").  If the Seller elects to direct a Contest, it shall 
within 30 calendar days of receipt of the notice of the Indemnification Event 
relating to such Contest notify the Purchaser of its intent to do so and, if 
requested by the Purchaser, the Seller shall furnish to the Purchaser in due
course, as a condition to further pursuing such Contest, an opinion of the 
Seller's independent tax counsel to the effect that the Seller has a reasonable
basis to pursue such Contest.  If the Purchaser or an Affiliate is requested 
(or, if an election by the Seller is not timely made, shall determine) to pay 
the Tax claimed and sue for a refund, the Seller shall make a tentative 
indemnity payment to the party making such payment.  In the case of any 
Contest, the Purchaser or its Affiliate, as the case may be, shall not make 
payment of the Tax in question for at least 30 days (or such shorter period 
as may be required by applicable law) after the giving of notice to the Seller 
of its intention to do so (and if the Seller has elected to direct the Contest 
shall not make payment unless requested by the Seller), shall give to the 
Seller any information reasonably requested by the Seller relating to such 
Contest and otherwise shall cooperate with the Seller in good faith in order 
to contest effectively any such Contest, and to the extent not inconsistent
with the Purchaser's or its Affiliates' control over the portion of proceedings 
that relate to issues other than those subject to this indemnity (as described 
below), shall permit the Seller to control such proceedings relating to any 
Contest.  The Seller shall, on demand, reimburse all "out of pocket" costs 
and expenses which the Purchaser or its Affiliate may incur in connection 
with such Contest (but not in connection with exercising the right of
attendance described below), including, without limitation, reasonable 
attorneys' and accountants' fees and disbursements.   The Purchaser or its duly 
appointed representatives shall be allowed to attend all meetings between the 
Seller and the taxing authority in question and shall be provided with copies 
of all correspondence and documents relating to such Contest.  If the Seller 
fails to notify the Purchaser of its election as herein provided, then until 
receiving notification as to the Seller's intentions, the Purchaser, CTUS, 
the Company and/or the appropriate Subsidiary shall take such reasonable steps 
as may be prudent and within its capacity (with due allowance being given to 
the circumstances) to preserve the right of the relevant entity to contest the
asserted Tax liability, may pay, compromise or contest, such asserted Tax 
liability and shall be reimbursed by the Seller for the reasonable cost of 
outside professionals and outside disbursements incurred pursuant to this 
sentence to the extent attributable to a Tax liability indemnifiable by the 
Seller hereunder.  However, in each such case, neither the Purchaser nor CTUS 
nor the Company nor the Subsidiary may settle or compromise any asserted Tax 
liability over the objection of the Seller; provided, however, that consent 
to settlement or compromise shall not be unreasonably withheld.  If the
Purchaser, CTUS, the Company or any Subsidiary assumes control of a Contest with
respect to Taxes pursuant to the foregoing, provided that the Seller has acted 
in good faith, the Seller shall retain the right, at any time thereafter and 
immediately upon notice to the entity that shall have assumed control of such 
Contest, to assume itself, at the Seller's expense, sole direction and control 
of such Contest, as set forth above.  If the Seller chooses to direct the 
Contest, the Purchaser shall promptly empower and shall cause CTUS, the 
Company and/or the appropriate Subsidiaries promptly to empower (by power of 
attorney and such other documentation as may be necessary and appropriate) 
such representatives of the Seller as it may designate to represent the 
Purchaser, CTUS, the Company and/or the Subsidiaries in the Contest insofar as 
the Contest involves an asserted Tax liability for which the Seller could be 
liable under Section 7.01.

          (c)  The Seller may cause such a Contest to be prosecuted to a
determination in a court of initial jurisdiction and, if the Seller shall have 
furnished the Purchaser with an opinion of independent tax counsel to the 
effect that there is a reasonable basis to appeal the determination of any 
court, the Seller may cause such Contest to be prosecuted to a determination 
in an appellate court.  Notwithstanding any other provision of this Section 
7.03 the Seller shall not settle, compromise or abandon without the Purchaser's 
prior written consent any Contest which would materially and adversely affect 
the Tax liability of the Purchaser or its Affiliates in any Post-Closing 
Period (including material adverse changes resulting from the imposition of 
income Tax deficiencies, the reduction of asset basis or cost adjustments, the 
lengthening of any amortization or depreciation periods or the denial of 
amortization or depreciation deductions) determined taking into account the 
then present value of any Tax benefits available to the Purchaser, CTUS, the 
Company or any Subsidiary by reason of any such settlement (taken into account 
as and when the Purchaser reasonably believes such Tax benefits could be 
utilized to reduce the Tax liability of the Purchaser, CTUS, the Company or 
any Subsidiary).  Such consent shall not be unreasonably withheld.

          (d)  With respect to Contests relating to any Post-Closing Period
(including any Contest relating to, or arising out of, any FIRREA Recovery 
described in Section 5.09) the Purchaser shall control all proceedings taken in 
connection with such Contests except that the Seller shall control such 
proceedings to the extent that they relate to a matter in respect of which 
the Seller has indemnified the Purchaser under Section 7.01 or 5.09 (including, 
for greater certainty, any Tax proceedings with respect to a matter that could 
affect the amount of the Preferred Stock Dividend Amount); provided, however, 
that if the Seller shall request in writing in a timely manner and furnish the 
Purchaser an opinion of independent tax counsel to the effect that the Seller 
has a reasonable basis to pursue such Contest, the Seller may cause such 
Contest to be prosecuted to a determination in a court of initial jurisdiction; 
and, provided further that if the Seller shall request in writing in a timely 
manner and furnish the Purchaser an opinion of independent tax counsel to the 
effect that the Seller has a reasonable basis to appeal the determination of 
any court, the Seller may cause such Contest to be prosecuted to a 
determination in an appellate court. 

          (e)  If, after actual receipt by the Purchaser or its Affiliates of an
amount paid by the Seller as a tentative indemnity pursuant to paragraph (b), 
the extent of the liability of the Purchaser or its Affiliates with respect to 
the indemnified matter shall be established by a Final Determination, the 
Purchaser or its Affiliates, as the case may be, shall promptly pay to the 
Seller all or the portion of any refund received by or credited to the 
Purchaser or its Affiliates with respect to the indemnified matter (together 
with any interest paid or credit thereon by the taxing authority) plus (i) the
amount of the Tax savings, if any, realized by the Purchaser or its 
Affiliates as a result of such payment, and (ii) interest at the rate which 
shall be applicable under section 6621(a)(1) of the Code in respect of federal 
income taxes and at the rate provided by applicable law in respect of other 
Taxes from time to time from the date of actual collection by the Purchaser 
or its Affiliates of such refund (and any such interest thereon) to the date 
of payment to the Seller hereunder.

          (f)  Nothing contained herein shall require the Purchaser or its
Affiliates, as the case may be, (i) to pursue a Contest which it would not 
otherwise be required to pursue pursuant to this Agreement or (ii) to permit 
the Seller to control any such Contest, if the Purchaser shall waive the 
payment by the Seller of any amount that might otherwise be payable by the 
Seller hereunder by way of indemnity in respect of such Contest.  Upon any 
such waiver, the Purchaser or its Affiliates, as the case may be, shall 
repay to the Seller any payments made with respect to such Contest pursuant 
to Section 7.03(b) above together with interest at the rate which shall be 
applicable under section 6621(a)(1) of the Code from time to time from the 
date the payment was paid by the Seller to the date of repayment by the 
Purchaser or its Affiliate.

          SECTION 7.04.  Preparation of Tax Returns.  The Seller shall prepare 
and timely file, or cause to be prepared and timely filed, all Returns relating 
to CTUS, the Company and the Subsidiaries that are due (taking into account any 
applicable extension periods) no more than 30 days after the Closing Date.  The 
Purchaser shall prepare and timely file or cause CTUS and the Company and the 
Subsidiaries to prepare and timely file all Returns relating to CTUS and the 
Company or any of the Subsidiaries that are due (taking into account any 
applicable extension period) more than 30 days after the Closing Date.  Returns 
required to be filed by the Purchaser in respect of a Pre-Closing Period shall 
be prepared on a basis consistent with those prepared for prior tax years 
unless a different treatment of any item is required by an intervening change 
in Law.  The Purchaser shall furnish the Seller with a copy of any Return 
prepared by it for a Pre-Closing Period at least 20 days before the anticipated 
filing date thereof and, in preparing such Returns, shall accept any comments 
made by the Seller with respect to any issue or item which could give rise to 
a claim for indemnification; provided, however, that this sentence shall not 
apply in respect of any comments for which the Seller does not provide the 
Purchaser, if so requested in writing to do so, with an opinion of counsel
to the effect that there is a reasonable basis for Seller's comment.

          SECTION 7.05.  Cooperation and Exchange of Information.  Following the
Closing, the Seller and the Purchaser shall provide each other, and the 
Purchaser shall cause CTUS and the Company to provide the Seller, with such 
cooperation and information as reasonably may be requested in filing any Tax 
Return, amended return or claim for refund, determining a liability for Taxes 
or a right to a refund of Taxes or participating in or conducting any audit 
or other proceeding in respect of Taxes.  Such cooperation and information 
shall include providing copies of relevant Tax Returns or portions thereof, 
together with accompanying schedules and related work papers and documents 
relating to rulings or other determinations by taxing authorities.  Each of the
Seller, the Purchaser and the Company shall make its employees available on a 
mutually convenient basis to provide explanations of any documents or 
information provided hereunder.  The Seller, on the one hand, and the Purchaser,
CTUS and the Company, on the other, shall each retain all Returns, schedules and
work papers and all material records or other documents that are in its 
possession immediately following the Closing, or created by or on behalf of it 
thereafter, relating to Tax matters of CTUS, the Company and the Subsidiaries 
for the taxable period of each relevant jurisdiction first ending after the 
Closing Date and for all prior taxable periods until the later of (i) the 
expiration of the statute of limitations of the taxable periods to which such 
returns and other documents relate, without regard to extensions except to the 
extent notified by the other party in writing of such extensions for the 
respective Tax periods, or (ii) eight years following the due date (without 
extension) for such returns.  Any information obtained under this Section 7.05 
shall be kept confidential, except as may be otherwise necessary in connection 
with the filing of Returns or claims for refund or in conducting an audit or
other proceeding.

          SECTION 7.06.  Conveyance Taxes.  Notwithstanding any provision herein
to the contrary, the Seller agrees to assume liability for and to pay a maximum
of U.S.$500,000 of all sales, use, transfer, stamp, stock transfer, withholding,
real property transfer or gains, registration, recording taxes or fees, or any 
similar Taxes or fees incurred as a result of the sale of the transactions 
contemplated hereby, and the Purchaser agrees to assume liability for and to 
pay any such Taxes in excess of such amount.  

          SECTION 7.07.  Miscellaneous.  (a)  The parties agree that all 
payments made under this Article VII, under any other indemnity provision 
contained in this Agreement, and for any misrepresentations or breach of 
warranties or covenants shall constitute adjustments to the Purchase Price 
and that they shall report all such payments on that basis in all Returns 
filed with any taxation authority for purposes hereof.  If, contrary to the 
intent of the parties as expressed in the preceding sentence, any indemnity 
payment made pursuant to this Agreement is treated as taxable income of the 
recipient, then the payor shall indemnify and hold harmless the recipient 
from any liability for Taxes attributable to the receipt of such payment.

          (b)   Except as expressly provided otherwise and except for the
representations contained in Sections 3.15 and 3.18 of this Agreement, this 
Article VII shall be the sole provision governing Tax matters and indemnities 
therefor under this Agreement.

          (c)  For purposes of this Article VII, all references to the 
Purchaser, the Seller, CTUS, the Company or the Subsidiaries include successors 
in interest, whether by operation of Law or otherwise.

          (d)  The covenants and agreements of the parties hereto contained in
this Article VII shall survive the Closing and shall remain in full force and 
effect until the expiration of all statutes of limitations with respect to any 
Taxes that would be indemnifiable by the Seller under Section 7.01(a) of this 
Agreement or by the Purchaser under Section 7.01(b) of this Agreement.

                               ARTICLE VIII

                           CONDITIONS TO CLOSING

          SECTION 8.01.  Conditions to Obligations of the Seller.  The 
obligations of the Seller to consummate the transactions contemplated by this 
Agreement shall be subject to the fulfillment, at or prior to the Closing, of 
each of the following conditions:

          (a)  Representations and Warranties; Covenants.  The representations
     and warranties of the Purchaser contained in this Agreement shall be true 
     and correct in all material respects as of the Closing with the same force 
     and effect as if made as of the Closing, other than such representations 
     and warranties as are made as of another date, and all the covenants 
     contained in this Agreement to be complied with by the Purchaser on or 
     before the Closing shall have been complied with in all material respects, 
     and the Seller shall have received a certificate of the Purchaser to 
     such effect signed by a duly authorized officer of the Purchaser;

          (b)  No Orders or Litigation.  No Governmental Authority shall have
     enacted, issued, promulgated, enforced or entered any statute, rule, 
     regulation, executive order, decree, injunction or other order (whether 
     temporary, preliminary or permanent), which is in effect preventing or 
     prohibiting consummation of any of the transactions contemplated by this 
     Agreement (nor shall any proceeding for any such statute, rule, 
     regulation, order, decree or injunction be pending), nor shall there be 
     any proceeding initiated or pending by any Governmental Authority or any 
     other Person seeking the prevention or prohibition of the consummation of
     any of the transactions contemplated by this Agreement or money damages 
     as a result thereof, including any actions to be taken by either party 
     pursuant hereto, except for any such proceeding pending or threatened by 
     a Person (other than a Governmental Authority) seeking only money damages; 
     provided, however, that the provisions of this Section 8.01(b) shall not 
     apply if the Seller has directly or indirectly solicited or encouraged 
     any such action; and provided further that the Seller may invoke this 
     condition, only if it shall have used its reasonable efforts to have any 
     such order vacated; and

          (c)  Approvals and Consents.  The Seller's Required Approvals shall
     have been made or obtained and any waiting period (and any extension 
     thereof) with respect thereto shall have expired or terminated (except 
     where the failure to obtain any such Seller's Required Approval from a 
     Person other than a Governmental Authority would not result in a Material 
     Adverse Effect) and all such Seller's Required Approvals shall still be 
     in effect.

          SECTION 8.02.  Conditions to Obligations of the Purchaser.  The
obligations of the Purchaser to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior to the Closing, of 
each of the following conditions:

          (a)  Representations and Warranties; Covenants.  The representations
     and warranties of the Seller contained in this Agreement shall be true and 
     correct as of the Closing (without regard to any Material Adverse Change/
     Effect exceptions, thresholds or knowledge qualifiers contained therein) 
     with the same force and effect as if made as of the Closing, other than 
     such representations and warranties as are made as of another date 
     (including Section 3.10(b)) and except for such inaccuracies as, 
     individually or in the aggregate, do not have a Material Adverse Effect, 
     and all material covenants contained in this Agreement to be complied with 
     by the Seller on or before the Closing shall have been complied with in 
     all material respects, and the Purchaser shall have received a certificate 
     of the Seller to such effect signed by a duly authorized officer of the 
     Seller;

          (b)  No Orders or Litigation.  No Governmental Authority shall have
     enacted, issued, promulgated, enforced or entered any statute, rule,
     regulation, executive order, decree, injunction or other order (whether 
     temporary, preliminary or permanent), which is in effect preventing or 
     prohibiting consummation of any of the transactions contemplated by this 
     Agreement (nor shall any proceeding for any such statute, rule, regulation,
     order, decree or injunction be pending), nor shall there be any proceeding 
     initiated or pending by any Governmental Authority or any other Person 
     seeking the prevention or prohibition of the consummation of any of the 
     transactions contemplated by this Agreement or money damages as a result 
     thereof, including any actions to be taken by either party pursuant hereto,
     except for any such proceeding pending by a Person (other than a 
     Governmental Authority) seeking only money damages; provided, however, 
     that the provisions of this Section 8.02(b) shall not apply if the 
     Purchaser has directly or indirectly solicited or encouraged any such 
     action; and provided further that the Purchaser may invoke this condition 
     only if it shall have used its reasonable efforts to have any such order 
     vacated; and

          (c)  Approvals and Consents.  The Purchaser's Required Approvals shall
     have been made or obtained and any waiting period (and any extension 
     thereof) with respect thereto shall have expired or terminated (except 
     where the failure to obtain any such Purchaser's Required Approval from a 
     Person other than a Governmental Authority would not result in a Material 
     Adverse Effect) and all such Purchaser's Required Approvals shall still  
     be in effect. 

                                ARTICLE IX

                     TERMINATION, AMENDMENT AND WAIVER

          SECTION 9.01.  Termination.  This Agreement may be terminated at any
time prior to the Closing:

          (a)  by the mutual written consent of the Seller and the Purchaser; or

          (b)  by either the Seller or the Purchaser, if the Closing shall not 
     have occurred prior to the date one year after the date of this Agreement; 
     provided, however, that the right to terminate this Agreement under this 
     Section 9.01(b) shall not be available to any party whose failure to 
     fulfill any obligation under this Agreement shall have been the cause 
     of, or shall have resulted in, the failure of the Closing to occur prior 
     to such date.

          Time shall be of the essence in this Agreement.

          SECTION 9.02.  Effect of Termination.  In the event of termination of 
this Agreement as provided in Section 9.01, this Agreement shall forthwith 
become void and there shall be no liability on the part of any party hereto (i) 
except as set forth in Section 5.05 and Section 10.05 and (ii) nothing herein 
shall relieve either party from liability for any willful breach hereof.

          SECTION 9.03.  Waiver.  At any time prior to the Closing, any party
hereto may (a) extend the time for the performance of any of the obligations or 
other acts of the other parties hereto, (b) waive any inaccuracies in the 
representations and warranties contained herein or in any document delivered 
pursuant hereto or (c) waive compliance with any of the agreements or 
conditions contained herein.

          SECTION 9.04.  Termination Fee.  In the event that the Seller 
unilaterally terminates this Agreement by repudiating its obligations in 
writing following the acceptance of an unsolicited offer for the purchase of 
CTUS, the Company and the Subsidiaries, the Seller shall promptly pay to or 
on behalf of the Purchaser $35,000,000, payable in immediately available 
funds to an account designated by the Purchaser.  The Purchaser acknowledges 
that, upon receipt of such payment, the Purchaser shall be deemed to have 
waived all claims, demands, damages and causes of action, and shall have no 
further recourse, against the Seller pursuant to this Agreement, and the Seller
shall have no further obligation to the Purchaser or any other Person pursuant 
to this Agreement.

                                 ARTICLE X

                            GENERAL PROVISIONS

          SECTION 10.01.  Non-Survival of Representations, Warranties, Covenants
and Agreements.  The representations, warranties, covenants and agreements 
contained herein shall be deemed to be conditions to the purchase and sale of 
the CTUS Shares as contemplated in Sections 8.01(a) and 8.02(a) and, following 
the Closing and/or the termination of this Agreement pursuant to Section 9.01, 
shall not survive, shall expire, be terminated and extinguished and the 
Purchaser's sole and exclusive remedy for breach of any representation or 
warranty by the Seller hereunder or failure by the Seller to comply with its 
covenants shall be (a) to exercise its rights under the indemnity provided
pursuant to Section 7.01 in the case of any matter relating to Taxes and (b) 
in the case of any other matter, including any matters covered by any 
representations and warranties of the Seller contained herein (other than 
relating to Taxes, which shall be subject only to indemnification as 
contemplated in clause (a) above), solely to exercise its rights to 
indemnification under Section 10.03; provided, however, that (i) consistent 
with the foregoing, following the Closing the representations and warranties 
contained in Sections 3.02, 3.03, 3.04, 3.05, 3.10, 3.11 and 3.17 (but only to 
the extent set forth in Section 10.03 hereof) shall remain in full force and 
effect for eighteen months solely for purposes of providing the basis for 
the indemnity contemplated in Section 10.03, (ii) the covenants and agreements 
set forth in Sections 4.08, 5.02, 5.03(b), 5.04, 5.05, 5.09, 5.10 and 5.11
and Articles VI, VII and X, shall remain in full force and effect for the 
applicable periods specified in such Sections or Articles or, if in any such 
case no such period is specified, until the applicable period under the 
statute of limitations therefor has expired and (iii) following termination 
of the Agreement, the covenants and agreements set forth in Sections 9.02 
and 10.05 shall survive until the applicable statute of limitations thereof
has expired.

          SECTION 10.02.  Release and Indemnification.  (a)  The Purchaser 
agrees to use its reasonable efforts (not including prepayment or renegotiation 
of the terms of any indebtedness) to cause the Seller or any Affiliate of the 
Seller (other than CTUS, the Company or the Subsidiaries) to be absolutely 
and unconditionally released on or effective as of the Closing Date from each 
liability and other obligation, direct or indirect, primary or secondary, for 
the payment of money or otherwise, including purchase or indemnification, 
guarantees or performance bonds, in respect of any outstanding indebtedness 
or contingent liabilities of CTUS, the Company, or the Subsidiaries, or issued 
for the account of or on behalf of a customer of CTUS, the Company of the 
Subsidiaries.  The Purchaser agrees to continue to use its reasonable efforts 
after the Closing Date to relieve the Seller and its Affiliates of any such 
liabilities or obligations that are not released or otherwise discharged on or 
effective as of the Closing Date.  The Seller agrees promptly upon demand to 
reimburse the Purchaser, CTUS, the Company or a Subsidiary, as the case may 
be, for all out-of-pocket costs and expenses incurred by it in securing any 
such release or discharge.

          (b)  The Purchaser shall indemnify and hold harmless the Seller and
each of its Affiliates, officers, directors, employees, successors and assigns 
(each, a "Seller Indemnified Party") for any and all liabilities, obligations, 
losses, damages, claims, costs and expenses, interest, awards, judgments and 
penalties (including, without limitation, reasonable attorneys' and consultants'
fees and expenses) suffered or incurred by them (including, without limitation, 
any claim, action, proceeding or investigation brought or otherwise initiated 
by any of them) to the extent arising solely out of, or resulting from, the 
conduct of the Businesses by CTUS, the Company or the Subsidiaries or the
Purchaser following the Closing or the operations of CTUS, the Company or the
Subsidiaries or the Purchaser subsequent to the Closing; provided, however, 
that the foregoing shall not apply to any transaction entered into between any 
Seller Indemnified Party and the Purchaser, CTUS, the Company or any subsidiary 
of the Purchaser subsequent to the Closing.

          SECTION 10.03.  Indemnification by the Seller.  (a)  Subject to the
procedures set forth in this Section 10.03, the Seller shall indemnify the 
Purchaser, its Affiliates, officers, directors, employees, successors and 
assigns and hold the Purchaser harmless for Losses (other than with respect 
to Taxes the indemnity for which is solely and exclusively as provided in 
Article VII) which relate to a matter or circumstance arising prior to the 
Closing Date and which are discovered and communicated in writing to the Seller 
within eighteen months from the Closing Date (or, in the case of any matter 
covered by clauses (i) and (ii) below, the end of the applicable statute of 
limitations period) solely with respect to Losses arising out of:

          (i)  any transaction contemplated by this Agreement relating to the
     Minority Shares, including, but not limited to, any liability with respect 
     to any payment required by law to be made by the Purchaser and/or its 
     Affiliates subsequent to the Closing to those holders of Minority Shares 
     that shall not have sold their shares, options and/or other similar 
     interests in the Company to the Seller prior to the Closing as 
     contemplated in Section 5.13;

          (ii) the prosecution of the FIRREA Claim in accordance with the
     directions of the Seller on the condition that the Purchaser strictly 
     complies with the Seller's instructions in accordance with the standards 
     contained in Section 5.09;

          (iii) any fraudulent activity of employees of the Seller not 
     disclosed to the Purchaser in the Seller Disclosure Schedule (or otherwise 
     in writing) that is not otherwise covered by insurance (but subject to any 
     deductibles applicable thereto); and

          (iv) any breach of the representations and warranties contained in
     Sections 3.02, 3.03, 3.04, 3.05, 3.11 and 3.17 (subject, in the case of 
     Section 3.17 only, to the knowledge qualifiers set forth therein but, 
     excluding, for purposes of this Section 10.03, any Material Adverse 
     Effect qualifier contained in Section 3.17, and in the case of Section 
     3.10 certain clauses thereof, consisting solely of (A) clause (b)(i) to 
     the extent relating to fixed assets, (B) clause (b)(ii) to the extent
     relating to Encumbrances on Real Property but, for the avoidance of doubt,
     excluding any other properties or assets and (C) clauses (b)(iii), 
     (b)(iv), (b)(v), (b)(vi), (b)(ix) and (b)(x).

          (b)  Notwithstanding anything in the Agreement to the contrary, the
obligation of the Seller to indemnify the Purchaser shall be subject to the 
following limitations:

          (i)  for purposes of calculating the amount of any Loss (A) in the 
     case of a Loss arising out of or in connection with a claim asserted by 
     a third party against the Purchaser, a Loss shall not be required to be 
     indemnified hereunder until the earlier of (x) such time as the Purchaser 
     is required by judicial action or otherwise to pay the Loss (or any 
     portion thereof) to such third party or (y) a liability is conclusively 
     established rather than when payment is claimed by such third party, (B) 
     in the case of any other Loss, such Loss shall not be required to be 
     indemnified hereunder until such time as liability is reasonably 
     demonstrated by the Purchaser to the Seller rather than when payment is 
     claimed by the Purchaser except as otherwise provided for in paragraph 
     (e) of this Section 10.03, and (C) the amount of a Loss shall be reduced 
     by:

               (1)  the amount of the reserve (if any) of such Loss or category 
          of Loss in the Company's financial statements, as the case may be, 
          but any such reserved Losses shall not be included in the Claim 
          Deductible (as defined below); 

               (2)  the financial effect of any Tax benefit obtainable as a 
          result of the recognition of such Loss as contemplated in paragraph 
          (c) below;  

               (3)  the amount of any insurance proceeds and any indemnity,
          contribution or other similar payment in fact recoverable by the 
          Purchaser or any Affiliate from any third party with respect thereto; 
          and

               (4)  the amount of any Loss that results from or arises out of
          actions taken by the Purchaser, the Company or their respective 
          Affiliates after the Closing Date (other than with respect to the 
          defense or settlement of claims relating to periods prior to the 
          Closing Date);

     it being understood and agreed that the Purchaser shall take, and following
     the Closing shall cause the Company to take, all reasonable steps to 
     mitigate their Losses upon and after becoming aware of any event which 
     could reasonably be expected to give rise to any Losses;

          (ii) the indemnification obligations of the Seller pursuant to this
     Section 10.03 shall not be effective with respect to any Loss, as the case 
     may be, unless (x) in the case of any Loss associated with any matter 
     described in clause (a)(i) or (a)(ii) above, the amount of each such Loss 
     exceeds U.S.$1,000, (y) in the case of any Loss arising out of a breach 
     of the representation and warranty in Section 3.02, the amount of each 
     such Loss exceeds U.S.$10,000 and (z) in the case of any Loss arising 
     out of clause (a)(iii) above or a breach of the representations and 
     warranties listed in clause (a)(iv) above (other than as relates to a 
     breach of Section 3.02 but subject, in the case of other referenced 
     sections, to the limitations contained herein), the amount of each such 
     Loss exceeds U.S.$2,500,000 (each, a "Claim Deductible"), it being 
     understood and agreed that only the amount of any such Loss that exceeds 
     the Claim Deductible shall be covered by the indemnity covered in this 
     Section 10.03 and shall be referred to herein as the "Indemnifiable 
     Amount" with respect to such Loss; and

          (iii)     the maximum aggregate payment that the Seller shall be 
     liable to pay out under this Section 10.03 in respect of any Loss or all 
     Losses (other than in respect of any Loss arising out of the matters set 
     forth in clauses (a)(i) and (a)(ii) above) in the aggregate whether in 
     respect of the Indemnified Amounts or otherwise shall be U.S.$60,000,000 
     (the "Maximum Aggregate Indemnity Payment Amount").

          (c)   The amount of any Tax benefit shall be computed at the maximum
applicable marginal statutory tax rate in effect at the time of computation.  
Tax benefits determined to be substantially likely to be realized not later 
than the taxable year during which an indemnity payment is determined to be 
due shall be considered to be realized currently for purposes of netting 
against such indemnity payment hereunder.  If a payment is made by the Seller 
in accordance with this Section 10.03, and if in a subsequent taxable year 
an actual Tax benefit is realized by the Purchaser, CTUS, the Company, any 
Subsidiary or any of their Affiliates (that was not previously taken into 
account to reduce an amount otherwise payable by the Seller under Section 
10.03), the Purchaser, CTUS, the Company, any such Subsidiary or any such 
Affiliate shall pay to the Seller at the time of such realization the amount 
of such Tax benefit to the extent that the Tax benefit would have resulted in 
a reduction in the amount paid by the Seller under this Section 10.03 if the 
Tax benefit had been obtained in the year of such payment.  Subject to the 
foregoing, a Tax benefit will be considered to be realized for purposes of 
this Section 10.03 at the time that it is reflected in a Tax Return of the
Purchaser, CTUS, the Company, any Subsidiary or any of their Affiliates. 

          (d)  For purposes of determining the Seller's liability under this 
Section 10.03, the Purchaser shall have the right initially to undertake the 
defense, appeal or settlement of any claim, assertion, event or proceeding for 
which indemnity is provided for hereunder; provided, however, that (i) prior to 
the Purchaser undertaking the defense, appeal or settlement of any claim, 
assertion, event or proceeding for which indemnity may be available pursuant 
hereto the Seller shall have the right to undertake such defense, appeal or
settlement at its own cost and expense and, if the Seller shall not have 
undertaken any such defense, appeal or settlement, Seller shall have the right 
to consult, through counsel of its own choosing, on such defense, appeal or 
settlement negotiations at its own expense and (ii) in the event that, prior 
to or following the undertaking by the Purchaser of the defense, appeal or 
settlement of any claim, assertion, event or proceeding for which indemnity 
may be available pursuant hereto, the Seller determines that the defense, 
appeal or settlement of a third party claim by the Purchaser is likely to 
result in an increase in the Seller's liability under the indemnity provided 
for herein, then the Seller shall be entitled to undertake the  defense, appeal,
prosecution  or settlement negotiations at its own cost and expense.  All legal 
fees and expenses regarding the defense of any claim, assertion, event or 
proceeding by or in respect of a third party as to which the Purchaser may 
request indemnification shall be includable in the definition of "Loss" 
contained herein subject to the limitation on the Maximum Aggregate Indemnity 
Payment Amount set forth herein, it being understood and agreed, however, 
that (i) the Seller shall fully reimburse the Purchaser and/or its
subsidiaries for legal fees and expenses incurred in retaining counsel to 
provide assistance in connection with the prosecution by Marine Midland Bank 
of the FIRREA Claim, in accordance with the requirements of Section 5.09, so 
long as the Seller shall have approved in advance the selection and retention 
of such counsel and (ii) the Seller shall fully reimburse the Purchaser and/or 
its subsidiaries for reasonable legal fees and expenses incurred in connection 
with any litigation relating to the Minority Shares not acquired by the Seller 
prior to the Closing.

          (e)  In no event shall the Purchaser settle any claim or demand (or 
part thereof) for which indemnification may be sought hereunder without the 
prior written consent of the Seller (which consent shall not be unreasonably 
withheld and which shall be deemed to have been given absent a response 
within 10 Business Days from the date of receipt by the Seller of the relevant 
notice), and the Seller shall not, without the prior written consent of the 
Purchaser (which shall not be unreasonably withheld and which shall be deemed 
to have been given absent a response within 10 Business Days from the date of 
receipt by the Purchaser of the relevant notice), effect any settlement of any
pending or threatened proceeding in respect of which the Purchaser is or could 
have been a party and indemnity could have been sought hereunder by the 
Purchaser unless (i) such proceeding involves only monetary claims and (ii) the 
settlement includes an unconditional release of the Purchaser from all liability
in respect of such claims.

          (f)  In the event the Seller shall make a payment hereunder, the 
Seller shall be deemed to be subrogated fully to the rights of the Purchaser 
against any and all third parties.

          (g)  Except as set forth in this Agreement, the Seller is not making 
any representation, warranty, covenant or agreement with respect to the matters 
contained herein.  Anything herein to the contrary notwithstanding, no breach 
of any representation, warranty, covenant or agreement contained herein shall 
give rise to any right on the part of the Purchaser, after the consummation 
of the purchase and sale of the CTUS Shares and the Minority Shares 
contemplated hereby, to rescind this Agreement or any of the transactions 
contemplated hereby and the Purchaser hereby acknowledges and agrees that, 
as contemplated in Section 10.01, from and after the Closing, its sole and 
exclusive remedy with respect to any and all claims relating to or arising 
out of this Agreement shall be pursuant to the indemnification provisions set
forth in this Section 10.03.  In furtherance of the foregoing, the Purchaser 
hereby waives, from and after the Closing, to the fullest extent permitted 
under applicable Law, any and all other rights, claims and causes of action 
it (or, after the Closing, any Company) may have against the Seller or its 
officers, directors, employees, agents, representatives and Affiliates 
relating to the subject matter of this Agreement; provided, however, that,
except as otherwise contemplated in Section 9.04, the foregoing waiver shall 
not preclude legal action by the Purchaser for knowing misrepresentation by 
the Seller or willful noncompliance by the Seller with the terms of this 
Agreement.

          SECTION 10.04.  Prior Tax Sharing Agreements.  This Agreement
terminates and supersedes any and all other tax sharing or allocation agreements
in effect on the date hereof as between the Seller or any predecessor or 
Affiliate (other than an identified Affiliate for which CTUS is a common parent 
corporation) thereof on the one hand, and CTUS, the Company and any of the 
Subsidiaries on the other hand, for all taxes imposed by any federal, state, 
foreign or local government or taxing authority, regardless of the Period 
for which such taxes are imposed.

          SECTION 10.05.  Expenses.  Except as otherwise provided in Sections 
2.04, 5.03(b), 5.09, 5.12, 5.13, 7.03(b) and 7.06, all costs and expenses, 
including, without limitation, fees and disbursements of counsel, financial 
advisors and accountants, incurred in connection with this Agreement and the 
transactions contemplated hereby shall be paid by the party incurring such 
costs and expenses, whether or not the Closing shall have occurred.

          SECTION 10.06.  Federal Home Loan Bank of New York Advances. 
Notwithstanding anything herein to the contrary, it is understood and agreed 
by the Seller and Purchaser that solely with respect to any of the advances 
to, or maintained by, the Company on the Closing Date from the Federal Home 
Loan Bank of New York, the Purchaser shall pay and be responsible for any 
fees and expenses of any kind or nature, arising out of or resulting from the 
consummation of the transactions contemplated by this Agreement or any 
repayment or prepayment or change in any of the terms of any such advances 
and such fees and expenses shall not be used in any adjustment pursuant to 
Section 2.04, Section 2.05 or otherwise or in any way become payable or 
suffered in any way by the Seller or the Company.   

          SECTION 10.07.  Notices.  All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be given or made 
(and shall be deemed to have been duly given or made upon receipt) by delivery 
in person, by courier service, by cable, by telecopy, by telegram, by telex or 
by registered or certified mail (postage prepaid, return receipt requested) to 
the parties at the following addresses (or at such other address for a party 
as shall be specified by like notice):

          (a)  if to the Seller:

               CT Financial Services Inc.
               Canada Trust Tower
               161 Bay Street, 35th Floor
               Toronto, Ontario M5J 2T2
               Attention:     Diane E. Walker, Esq.
                       Senior Vice President,
                       Law & Governmental Relations
               Telecopy:  (416) 361-5465

               with a copy to:

               Shearman & Sterling
               599 Lexington Avenue
               New York, New York  10022
               Attention:  Stuart K. Fleischmann, Esq.
               Telecopy:  (212) 848-7179

          (b)  if to the Purchaser:

               One Marine Midland Center
               24th Floor
               Buffalo, New York  14203
               Attention:  Philip S. Toohey, Esq.
                       General Counsel and Secretary
               Telecopy:  (716) 841-5391

               with a copy to:

               Cleary, Gottlieb, Steen & Hamilton
               One Liberty Plaza
               New York, New York  10006
               Attention:  James F. Munsell, Esq.
               Telecopy:  (212) 225-3999

          SECTION 10.08.  Public Announcements.  Unless otherwise required by
stock exchanges, regulatory agencies or under any Law, no party to this 
Agreement shall make any public announcements in respect of this Agreement or 
the transactions contemplated herein or otherwise communicate with any news 
media without prior notification to the other party, and the parties shall 
cooperate as to the timing and contents of any such announcement.

          SECTION 10.09.  Headings.  The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

          SECTION 10.10.  Severability.  If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of 
Law or public policy, all other conditions and provisions of this Agreement 
shall nevertheless remain in full force and effect so long as the economic or 
legal substance of the transactions contemplated hereby is not affected in any 
manner materially adverse to any party.  Upon such determination that any 
term or other provision is invalid, illegal or incapable of being enforced, 
the parties hereto shall negotiate in good faith to modify this Agreement so 
as to effect the original intent of the parties as closely as possible in a
mutually acceptable manner in order that the transactions contemplated hereby be
consummated as originally contemplated to the greatest extent possible.

          SECTION 10.11.  Disclosure Schedule.  Disclosure of information by the
Seller in any portion of the Seller Disclosure Schedule, and disclosure of 
information by the Purchaser in any portion of the Purchaser Disclosure 
Schedule, shall be deemed disclosure in any other portion of the Seller 
Disclosure Schedule or the Purchaser Disclosure Schedule, as the case may be.

          SECTION 10.12.  Entire Agreement.  This Agreement constitutes the
entire agreement of the parties hereto with respect to the subject matter 
hereof and supersedes all prior agreements and undertakings, both written and 
oral, other than the Confidentiality Agreement between the Seller and the 
Purchaser with respect to the subject matter hereof and except as otherwise 
expressly provided herein.

          SECTION 10.13.  Assignment.  This Agreement may not be assigned by
either party hereto without the consent of the other party hereto (whether by 
operation of law or otherwise unless specifically provided herein); provided, 
however, that the Seller may transfer or assign any or all of its CTUS Shares 
and/or any or all of its rights and obligations under this Agreement, in whole 
or in part, to Imasco Limited or any direct or indirect subsidiary of Imasco 
Limited or the Seller so long as (i) CT Financial Services Inc., shall remain 
liable for all of such assignee's obligations under this Agreement and (ii) 
the representations and warranties made at Closing shall be deemed to have 
been made by CT Financial Services Inc. except that, to the extent the CTUS
Shares are assigned to any assignee, the first sentence of Section 3.04 shall 
be revised to reflect the transfer of record and beneficial ownership to such 
assignee, and Section 5.11 which, for the avoidance of doubt, shall only be 
a covenant of CT Financial Services, Inc. and by no other Person, including 
any permitted assignee as contemplated herein.

          SECTION 10.14.  No Third-Party Beneficiaries.  Except as provided in
Article VII and Sections 5.02(a) and 10.02, this Agreement is for the sole 
benefit of the parties hereto and their permitted assigns and nothing herein, 
express or implied, is intended to or shall confer upon any other person or 
entity any legal or equitable right, benefit or remedy of any nature whatsoever 
under or by reason of this Agreement.

          SECTION 10.15.  Amendment; Waiver.  This Agreement may not be
amended or modified except by an instrument in writing signed by the Seller 
and the Purchaser.  Waiver of any term or condition of this Agreement shall 
only be effective if in writing and shall not be construed as a waiver of any 
subsequent breach or a waiver of any other term or condition of this Agreement.

          SECTION 10.16.  Governing Law.  This Agreement shall be governed by,
and construed in accordance with, the Laws of New York applicable to contracts
executed in and to be performed in that State.  All actions and proceedings 
arising out of or relating to this Agreement shall be heard and determined in 
a New York state or federal court sitting in the Southern District of New York, 
and the parties hereto hereby irrevocably submit to the exclusive jurisdiction 
of such courts in any such action or proceeding and irrevocably waive the 
defense of an inconvenient forum to the maintenance of any such action or 
proceeding.

          SECTION 10.17.  Counterparts.  This Agreement may be executed in one
or more counterparts, and by the different parties hereto in separate 
counterparts, including via telecopier, each of which when executed shall be 
deemed to be an original but all of which taken together shall constitute one 
and the same agreement.

          IN WITNESS WHEREOF, the Seller and the Purchaser have caused this
Agreement to be executed as of the date first written above by their respective 
officers thereunto duly authorized.
                                   
               

                                   CT FINANCIAL SERVICES INC.

                                   By:   /s/  Edmund Clark                 

                                   By:   /s/  Paul Derksen                 

                                   HSBC AMERICAS, INC.

                                   By:   /s/  James H. Cleave              

                                   By:   /s/  Philip S. Toohey
Exhibit 2.05(b)

Forecast of book value (of the Company) pursuant to stock purchase agreement

($ in millions)
                                       Projected   Accrual    Accrual Recapture   
                                            core       for        for        to             Estimated
                                             net estimated  estimated     def'd                  book
                                Actual    income     stock  severance       tax  Accrual of     value
                            book value        (5    option          &       val        SAIF        at
                               6/30/96    months)   payout incentives     allow  assessment   closing
Total expected benefit 
 (obligation)                   $ 43.9    $(15.0)   $(18.0)      $5.0         -
Less:  current amounts 
        accrued                                       10.0 
Less:  amounts covered by 
        Marine                                                   16.0 
  Pre tax income (expense)                  43.9      (5.0)      (2.0)      5.0           -           
Taxes                                      (18.9)      2.2        0.9         -           - 
  Net Income                                25.0      (2.9)      (1.1)      5.0           -
Div to CT per sec 2.05 
 (<= $5.3 @ month)                         (25.0)
  Book value                    $448.0       0.0      (2.9)      (1.1)      5.0           -    $449.0
Adjustments to audited 
 book value per sec 2.05                               2.9        1.1         -           -
Pre closing payments/div 
 per sec 5.07                              (53.0) 
  "Audited" book value          $448.0     (53.0)        -          -       5.0           -    $400.0
Total dividends paid to CT                          Differential amount
                                          $ 78.0     Audited book value                        $400.0
                                                    Targeted book value               400.0          
                                                    Add: excess interim
                                                     earnings > $5.3 mm                   -     400.0
                                                    Differential: 
                                                     adjustment to      
                                                     purchase price                            $  0.0
Exhibit 5.09(b)

                    Term Sheet for the Preferred Stock

Issuer:             CTUS 

Issue:              100 shares of Series A Preferred Stock, par value $.01
                    per share (the "Preferred Stock").

Ranking:            Will rank senior to the common stock of CTUS and any
                    preferred stock of CTUS or any successor-in-interest thereto
                    issued after the issuance of the Preferred Stock.

Annual Dividends:   None.

Special Dividends:  Payment made in an amount equal to the Preferred Stock
                    Dividend Amount on first Business Day following the later 
                    of (i) 90 days after the commencement of the FIRREA
                    Plaintiff's taxation year in which the FIRREA Plaintiff
                    receives the FIRREA Recovery and (ii) 30 days after 
                    receipt of the FIRREA Recovery by the FIRREA Plaintiff.

Redemption/
Cancellation:       Redemption at the option of the holder, following the
                    later of (i) the final determination, settlement or
                    compromise of the FIRREA Claim and (ii) the receipt
                    by the FIRREA Plaintiff of the FIRREA Recovery, if
                    any.  Redeemable at the option of the issuer 280 days
                    following the distribution of the Preferred Stock
                    Dividend Amount. 

Redemption Amount/
Liquidation Preference:       Preferred Stock Redemption Amount.

Voting Rights:      No voting rights, except as provided by law.  CTUS or any
                    successor-in-interest thereto shall not, without the vote 
                    of two-thirds of the outstanding shares of the Preferred 
                    Stock, (a) amend, alter, repeal or waive compliance with 
                    any provision of the Certificate of Incorporation of CTUS 
                    or any successor-in-interest thereto so as to affect 
                    adversely the specified rights, preferences, privileges 
                    or voting rights of the Preferred Stock, (b) authorize 
                    the issuance of any additional shares of Preferred Stock 
                    or any securities senior to the Preferred Stock or 
                    (c) effect any reclassification of the Preferred Stock.

Other Rights:       The holder(s) of the Preferred Stock shall have the right
                    to direct the FIRREA Claim and shall have sufficient
                    protection to maintain their rights in the FIRREA Claim
                    in the event that the Company (or any successor-in-
                    interest) is not a wholly-owned subsidiary or CTUS (or
                    any successor-in-interest).

Transferability:    Within Imasco/BAT family and otherwise with the
                    Purchaser's consent.

                                                             Exhibit 5.09(e)

                           STANDARDS OF CONDUCT
                           FOR FIRREA PLAINTIFF

          (a)  the FIRREA Plaintiff may rely and shall be protected in acting 
  or refraining from acting upon any resolution, certificate, statement, 
  instrument, opinion, report, notice, request, direction, consent, order or 
  other paper or document believed by it to be genuine and to have been signed 
  or presented by the Seller;

          (b)  any request or direction of the Seller pursuant to Section 5.09 
  of the Agreement shall be sufficiently evidenced by a Seller request or order 
  which appears on its face to have been signed by an executive officer of the 
  Seller and any resolution of the Board of Directors of the Seller may be 
  sufficiently evidenced by a board resolution of the Seller certified by its 
  secretary or an assistant secretary;

          (c)  whenever the FIRREA Plaintiff shall deem it desirable that a
  matter be proved or established prior to taking, suffering or omitting any 
  action hereunder, the FIRREA Plaintiff (unless other evidence be herein 
  specifically prescribed) may, in the absence of bad faith on its part, rely 
  upon a board resolution, an opinion of counsel or an officers' certificate 
  of the Seller;

          (d)  the FIRREA Plaintiff shall not be bound to make any 
  investigation into the facts or matters stated in any resolution, 
  certificate, statement, instrument, opinion, report, notice, request, 
  direction, consent, order or other paper or document, but the FIRREA 
  Plaintiff, in its discretion, may make such further inquiry or investigation 
  into such facts or matters as it may see fit;

          (e)  the FIRREA Plaintiff may execute any of the powers provided  
  for in Section 5.09(c) of the Agreement or perform any duties thereunder 
  either directly or by or through agents, attorneys, custodians or nominees 
  and the FIRREA Plaintiff shall not be responsible for the supervision of or 
  any misconduct or negligence on the part of any such agent, attorney, 
  custodian or nominee appointed with due care by it hereunder; 

          (f)  the FIRREA Plaintiff shall not be liable for any action taken,
  suffered or omitted by it in good faith and believed by it to be authorized 
  or within the discretion or rights or powers conferred upon it by Section 
  5.09(c) of the Agreement;

          (g)  The FIRREA Plaintiff shall not be required to expend or risk 
  its own funds or otherwise incur any financial liability in the performance 
  of any of it duties set forth in Section 5.09(c) of the Agreement, or in 
  the exercise of any of its rights or powers, if it shall have reasonable 
  grounds for believing that repayment of such funds or adequate indemnity 
  against such risk or liability is not reasonably assured to it;

          (h)  The FIRREA Plaintiff shall not be required to expose itself to
  criminal liability or punitive damages in the performance of any of its 
  obligations under Section 5.09 of the Agreement.

                                                            Exhibit 5.14(c)

                                    
               
                                    
                                    
                                    
                                    
                                    
                  PROPOSED FORM OF BANK PLAN OF MERGER
                                    
                                    
                                 BETWEEN
                                    
                           MARINE MIDLAND BANK
                                    
                                   AND
                                    
         FIRST FEDERAL SAVINGS AND LOAN ASSOCIATION OF ROCHESTER
                                    
                                    
                  DATED                         , 1996

           BANK PLAN OF MERGER dated ______________________, 1996 (the
"Agreement"), between MARINE MIDLAND BANK ("Marine"), a New York banking
corporation and a subsidiary of HSBC AMERICAS, INC. ("HZ"), and FIRST
FEDERAL SAVINGS AND LOAN ASSOCIATION OF ROCHESTER ("First
Federal"), a federal savings and loan association and a subsidiary of CTUS, 
Inc. ("CTUS").

                             Recitals

                                   
          A.   The Boards of Directors of HZ and CTUS have approved, and
deem it advisable and in the best interests of their shareholders to 
consummate, the business combination transaction set forth in the Stock 
Purchase Agreement and Plan of Merger, dated as of August 21, 1996, between 
HZ, MM Merger Corporation, a wholly owned subsidiary of HZ (the "Merger 
Subsidiary"), and CT Financial Services, Inc. (the "Parent Merger Agreement") 
pursuant to which the Merger Subsidiary would merge with and into CTUS (the 
"Parent Merger").

          B.   The Boards of Directors of Marine and First Federal, and HZ 
and CTUS as the sole shareholders of Marine and First Federal, have approved 
and deem it advisable to consummate the business combination transaction 
provided for in this Agreement, pursuant to which First Federal would merge
with and into Marine (the "Bank Merger"), subject to and as soon as 
practicable after consummation of the Parent Merger.

                              Agreement
   
                              
                              ARTICLE I
                          
                              The Merger
                         

          1.1  Effective Time of Bank Merger.  The Bank Merger shall become
effective on the filing of this Agreement (the "Plan of Merger") in the 
office of the Superintendent of Banks of the State of New York as provided 
in Section 601-b of the New York Banking Law and upon the filing of Articles 
of Combination with the Office of Thrift Supervision ("OTS") and the 
endorsement of the Articles of Combination by the OTS in accordance with 
12 C.F.R. Section 552.13(j) (the "Effective Time").  After the filing of the 
Plan of Merger in the Superintendent's office and the filing of the Articles 
of Combination with the OTS, the Surviving Bank (as defined in Section 1.2) 
shall cause the Plan of Merger to be filed in the office of the Clerk of 
Erie County.  

          1.2  Effects of Merger.

          (a)  At the Effective Time (i) the separate existence of First 
Federal shall cease, and First Federal shall be merged with and into Marine 
(Marine and First Federal being sometimes referred to as the "Constituent 
Banks" and Marine being sometimes referred to as the "Surviving Bank"); and 
(ii) the Organization Certificate of Marine as in effect immediately prior 
to the Effective Time shall be the Organization Certificate of the Surviving 
Bank, and the name of the Surviving Bank shall be "Marine Midland Bank"; 
and (iii) the By-Laws of Marine in effect immediately prior to the Effective 
Time shall be the By-Laws of the Surviving Bank.

          (b)  At and after the Effective Time, the Bank Merger shall have 
all the effects set forth in Section 602 of the New York Banking Law; the 
separate existence of First Federal shall cease; and all of the property, 
rights, powers, duties and obligations of First Federal and Marine shall 
be taken by and deemed to be transferred to and vested in the Surviving 
Bank without further act or deed. 

          1.3  Headquarters; Offices.  The headquarters and principal office 
of the Surviving Bank shall be at One Marine Midland Center, Buffalo, 
New York.  The branch offices of Marine shall remain the branch offices of 
the Surviving Bank, and First Federal's principal office at One First 
Federal Plaza, Rochester, New York, and its branch offices shall become 
branch offices of the Surviving Bank.

          1.4  Directors and Officers.  From and after the Effective Time, 
the directors of the Surviving Bank shall be the directors of Marine in 
office immediately before the Effective Time.  The officers of the Surviving 
Bank shall be the officers of Marine in office immediately before the 
Effective Time.

                                ARTICLE II

               Effect on Capital Stock of Constituent Banks

          2.1  Effect on First Federal Stock.  At the Effective Time, by 
virtue of the Bank Merger and without any action on the part of the holder 
of the shares of the common stock, par value $           per share, of 
First Federal ("First Federal Common Stock"):

          (a)  Cancellation of Treasury Stock.  All shares of First Federal
Common Stock owned by First Federal as treasury stock shall be cancelled and 
retired and shall cease to exist, and all rights in respect of such shares 
shall cease.

          (b)  Cancellation of Issued and Outstanding Common Stock.  All 
shares of First Federal Common Stock issued and outstanding immediately prior 
to the Effective Time shall be deemed cancelled and retired and shall cease to 
exist, and all rights in respect of such shares shall cease.

          2.2  Effect on Marine Stock.  At the Effective Time, by virtue of 
the Bank Merger and without any action on the part of the holder of the shares 
of common stock, par value $100.00 per share, of Marine (the "Marine Common 
Stock"), each share of the Marine Common Stock issued and outstanding 
immediately prior to the Effective Time shall be converted into one issued 
and outstanding share of the Surviving Bank, and the holder of the Marine 
Common Stock shall automatically become the holder of the issued and 
outstanding shares of the Surviving Bank. 

                                ARTICLE III

                           Conditions Precedent

          3.1  Conditions to Each Party's Obligations.  The obligations of each
party to effect the Bank Merger shall be subject to the satisfaction of the 
following conditions before the Closing Date (as defined in the Parent Merger 
Agreement):

          (a)  Parent Merger.  The Parent Merger shall have occurred.

          (b)  No Injunctions or Restraints; Illegality.  No temporary 
restraining order, preliminary or permanent injunction or other order issued 
by any court of competent jurisdiction or any other legal restraint or 
prohibition ("Injunction") preventing the consummation of the Bank Merger 
shall be in effect.  There shall not have been any action taken or any 
statute, rule or other regulation enacted, entered, enforced or deemed 
applicable to the Bank Merger that makes the consummation of the Bank Merger 
illegal.

          (c)  Other Approvals.  All regulatory and stockholder approvals 
required in the Parent Merger Agreement shall have been obtained and continue 
to be in full force and effect, and CTUS, as the sole stockholder of First 
Federal, shall have approved the Bank Merger.

                                ARTICLE IV

                               Miscellaneous

          4.1  Termination.  This Agreement shall be deemed terminated if the
Parent Merger Agreement is terminated pursuant to Section 9.01 thereof, and
termination of this Agreement shall have the same effects as those set forth 
in Section 9.02 of the Parent Merger Agreement with respect to the termination 
of the Parent Merger Agreement.

          4.2  Amendment.  This Agreement may be amended only by a written
agreement signed by the parties, and any amendment shall be subject to any 
required regulatory agency approval.  An extension of time to perform any 
obligation under this Agreement or a waiver of any breach or requirement 
of this Agreement shall be effective only if it is set forth in a writing 
signed by the party against whom it is sought to be enforced.

          4.3  Captions.  The subject headings of this Agreement are included 
for convenience only and shall not affect the construction or interpretation 
of this Agreement.

          4.4  Definitions.  Capitalized terms not otherwise defined in this
Agreement shall have the meanings for such terms that are set forth in the 
Parent Merger Agreement.

          4.5  Survival.  Each representation, warranty and covenant set forth 
in this Agreement shall terminate as of the Closing Date.

          4.6  Counterparts.  This Agreement may be executed in any number of
counterparts.  Each counterpart shall constitute an original instrument, but all
counterparts shall constitute one and the same instrument.

          4.7  Governing Law.  Except to the extent governed by federal law, the
validity, construction and enforceability of this Agreement shall be governed 
by the internal laws of the State of New York without reference to conflicts 
of law principles.

          Marine and First Federal have caused this Agreement to be executed 
by their duly authorized officers and their corporate seals to be affixed as 
of the date first written above.

                                   MARINE MIDLAND BANK

[SEAL]
                                   By                       

                                   FIRST FEDERAL SAVINGS AND
                                   LOAN ASSOCIATION OF
                                   ROCHESTER

[SEAL]
                                   By                       

                                                      Exhibit 13

                           CTUS AND SUBSIDIARIES

                    Consolidated Financial Statements

                        December 31, 1995 and 1994
 
               (With Independent Auditors' Report Thereon)

Peat Marwick LLP
600 Clinton Square  
Telephone 716 454 1644 Telefax 716 454 1469
Rochester, NY 14604

                      Independent Auditors' Report

The Shareholder and Board of Directors of CTUS:

We have audited the accompanying consolidated statements of
financial condition of CTUS and subsidiaries as of December 31,
1995 and 1994, and the related consolidated statements of income,
changes in stockholder's equity, and cash flows for the years
then ended. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is
to express an opinion on these consolidated financial statements
based on our audits.

We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial
position of CTUS and subsidiaries as of December 31, 1995 and
1994, and results of their operations and their cash flows for
the years then ended in conformity with generally accepted
accounting principles.

As discussed in note 1 to the consolidated financial statements, 
the Company adopted the provisions of Statement of Financial 
Accounting Standards (SFAS) No. 114, Accounting for Impairment of 
a Loan, as amended by SFAS No. 118, Accounting by Creditors for 
Impairment of a Loan - Income Recognition and Disclosures, on 
January 1, 1995, and SFAS No. 115, Accounting for Certain 
Investments in Debt and Equity Securities, on January 1, 1994.

                         /s/ KPMG Peat Marwick LLP

January 12, 1996
CTUS AND SUBSIDIARIES
                 Consolidated Statements of Financial Condition
                           December 31, 1995 and 1994
                   (amounts in thousands except share amounts)

                                                   1995        1994 
     Assets
Cash and cash equivalents                    $  227,185  $  215,363 
Securities available for sale, 
 at fair value                                  629,395      65,763      
Securities held to maturity                     300,460   1,159,538 
Loans                                         5,777,051   4,955,678 
  Allowance for loan losses                      38,842      35,373 
  Net loans                                   5,738,209   4,920,305 
 
Federal Home Loan Bank stock, at cost            85,838      75,625 
Accrued interest receivable                      44,291      37,783 
Premises and equipment, net                      56,785      56,213 
Cost of loan servicing rights acquired           59,018      29,062      
Excess loan servicing fees capitalized           15,095      17,231 
Other assets                                     40,444      38,780 
     Total assets                            $7,196,720  $6,615,663 

     Liabilities and Stockholder's Equity

Liabilities:
  Deposits                                   $4,210,502  $4,031,197 
  Advances from Federal Home Loan Bank        1,710,955   1,504,874 
  Securities sold under agreements to
   repurchase                                   570,648     498,077 
  Collateralized mortgage obligations             8,531       9,918 
  Senior and subordinated debt                   82,000      53,000      
  Advances from borrowers for taxes and
   insurance                                    125,799     111,411 
  Accrued interest payable                       47,566      25,746 
  Other liabilities                             126,861     112,495 
  Minority interest in subsidiary                 2,710       2,469 
     Total liabilities                        6,885,572   6,349,187 

Stockholder's Equity
  Common stock, $.01 par value, 10,000 
   shares authorized, 100 shares issued 
   and outstanding                                    -           - 
  Additional paid in capital                    163,000     163,000 
  Retained earnings                             146,714     104,506 
  Unrealized gain (loss) on securities
   available for sale, net of taxes               1,434      (1,030)     

     Total stockholder's equity                 311,148     266,476 

     Total liabilities and 
      stockholder's equity                   $7,196,720  $6,615,663 

See accompanying notes to consolidated financial statements.
CTUS AND SUBSIDIARIES
        Consolidated Statement of Changes in Stockholder's Equity
                Years Ended December 31, 1995 and 1994
                        (amounts in thousands)

                              Common Stock            Net unrealized
                                       and             Gain(Loss) on
                                Additional                Securities
                                      Paid  Retained       Available
                                in Capital  Earnings        for Sale     Total
Balance, December 31, 1993        $163,000   $72,418        $     -   $235,418 

Net income, 1994                         -    32,088              -     32,088 

Net unrealized loss
 on securities available
 for sale, net of tax
 effect of $776                          -         -         (1,030)    (1,030) 

Balance, December 31, 1994         163,000   104,506         (1,030)   266,476 

Net income, 1995                         -    42,208              -     42,208 

Net change in unrealized 
 gain (loss) on securities 
 available for sale, net of 
 tax effect of $1,858                    -         -          2,464      2,464 

Balance, December 31, 1995        $163,000  $146,714        $ 1,434   $311,148 

See accompanying notes to consolidated financial statements.
CTUS AND SUBSIDIARIES
                        Consolidated Statements of Income
                     Years Ended December 31, 1995 and 1994
                             (amounts in thousands)

                                                 1995        1994
Interest income:                                                                   
  Loans - interest and fees                  $396,178    $306,177            
  Securities                                   67,492      70,462 
  Cash equivalents                              7,569       7,715 
  Other                                         9,964       9,848 
     Total interest income                    481,203     394,202 

Interest expense:
  Deposits                                    172,177     132,521 
  Federal Home Loan Bank advances             100,183      76,793 
  Securities sold under agreements
   to repurchase                               33,181      16,747 
  Other borrowings                              9,330       7,052 
     Total interest expense                   314,871     233,113 

     Net interest income before provision     166,332     161,089 

Provision for loan and mortgage-backed
 security losses                               15,756      18,054 

     Net interest income after provision      150,576     143,035 

Other operating income:
  Loan fees                                     5,166       4,246 
  Loan servicing income, net                   11,376       9,741 
  Customer service fees                        14,685      13,439 
  Net gain (loss) on sale of mortgage loans
   and securities                               6,194        (433)
  Other                                         5,939       5,196 
     Total other operating income              43,360      32,189 

Other operating expenses:
  Employee compensation and benefits           59,206      55,687 
  Office occupancy and equipment               23,048      20,256 
  General and administrative                   25,520      27,763 
  Marketing                                     3,800       4,033 
  Deposit insurance premiums                   10,831      10,734 
     Total other operating expenses           122,405     118,473 

Minority interest in net income of 
 subsidiary                                       280         252 

  Income before taxes                          71,251      56,499 

  Income taxes                                 29,043      24,411 

  Net income                                 $ 42,208    $ 32,088 

See accompanying notes to consolidated financial statements.
CTUS AND SUBSIDIARIES
             Consolidated Statements of Cash Flows
             Years Ended December 31, 1995 and 1994
                     (amounts in thousands)

                                                1995         1994
Cash flows from operating activities:
  Net income                             $    42,208    $  32,088 
  Adjustments to reconcile net income 
   to net cash provided by operating 
   activities:
     Depreciation, amortization and 
      accretion                               22,325       20,491 
     Provision for loan and mortgage-
      backed security losses                  15,756       18,054 
     Deferred income taxes                    (4,991)      11,076 
     Net (gain) loss on sale of mortgage 
      loans and securities                    (6,194)         433 
     Loan fees and discounts deferred - net  (13,710)      (8,295)
     Decrease(Increase) in mortgage loans 
      held for sale - net                    (77,920)     105,865 
     Net change in:
        Other assets and accrued interest 
          receivable                          (8,172)       2,884 
        Other liabilities and accrued 
         interest payable                     41,178      (65,614)
        Other items                              788       (3,420)
        Net Cash provided by operating 
         activities                           11,268      113,562 

Cash flows from investing activities:
  Proceeds from sales of portfolio loans      84,665       59,348 
  Proceeds from sales of securities 
   available for sale                        143,028      160,634 
  Principal payments of loans for 
   portfolio                                 835,279      803,849 
  Investments in loans                    (1,659,142)  (1,676,813)
  Purchases of securities available 
   for sale                                  (49,000)     (13,688)
  Purchases of securities held to 
    maturity                                 (20,000)    (168,145)
  Increase in servicing rights               (36,132)     (16,594)
  Purchase of FHLB stock, net                (10,213)      (3,635)
  Purchases of premises and 
    equipment, net                           (10,311)     (10,744)
  Proceeds from maturities of and 
    principal collected on securities        224,250      332,408 
     Net cash used by investing 
      activities                            (497,576)    (533,380)

Cash flows from financing activities:
  Deposit acquisitions                             -       25,065 
  Increase in deposits                       179,305       77,490 
  Proceeds from FHLB advances              2,242,489    1,985,180 
  Payments on FHLB advances               (2,038,236)  (1,882,000)
  Increase in securities sold under 
   agreement to repurchase                    72,571      199,391 
  Increase in subordinated debt               29,000            - 
  Net increase (decrease) in advances 
   from borrowers for taxes and insurance     14,388          (56)
  Decrease in collateralized mortgage 
   obligations                                (1,387)      (2,634)
Net cash provided by financing 
 activities                                  498,130      402,436 
  Net increase(decrease) in cash and 
   cash equivalents                           11,822      (17,382)
Cash and cash equivalents at 
 beginning of year                           215,363      232,745 
Cash and cash equivalents at 
 end of year                             $   227,185   $  215,363 

Supplemental disclosure of cash flow 
 information:
  Cash paid during the year for:
     Interest                            $   293,023   $  246,577 
     Income taxes                             22,595        9,795 

Non cash investing activities:
  Change in net unrealized gain (loss) 
   on securities available for sale      $     2,464   $    1,030 
  Transfer of foreclosed real estate          19,547       32,600 

See accompanying notes to consolidated financial statements.
CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

                        December 31, 1995 and 1994

(1)  Summary of Significant Accounting Policies

     (a)  Basis of Presentation

          CTUS, a unitary thrift holding company (the "Company"), is the
          parent of First Federal Savings and Loan Association of Rochester
          and subsidiaries (the "Subsidiary") and is owned by CT Financial
          Services, Inc. (the "Parent") through a subsidiary of the parent,
          CT North America Financial Holdings.  

     (b)  Principles of Consolidation

          The consolidated financial statements include the accounts of the
          Company and its Subsidiary.  All significant intercompany accounts
          and transactions have been eliminated.

     (c)  Cash Equivalents

          Cash equivalents consist of federal funds sold, certificates of
          deposits and funds due from banks.  For purposes of the statements
          of cash flows, all highly liquid debt instruments with original
          maturities of three months or less are considered cash
          equivalents.

     (d)  Securities
     
          Effective January 1, 1994, the Company adopted the provisions of
          Statement of Financial Accounting Standards No. 115, Accounting
          for Certain Investments in Debt and Equity Securities.  The
          Statement requires classification of securities into three
          categories: trading, available for sale, or held to maturity.  The
          Company classifies its debt securities as either available for
          sale or held to maturity, as the Company does not hold any
          securities considered to be trading.

          Held to maturity securities are those that the Company has
          the positive intent and ability to hold to maturity.  All
          other securities not classified as held to maturity are
          classified as available for sale.

          Available for sale securities are recorded at fair value.  Held to
          maturity securities are recorded at cost, adjusted for the
          amortization or accretion of premiums or discounts.  Unrealized
          holding gains and losses, net of the related tax effect, on
          available for sale securities are excluded from earnings and are
          reported as a separate component of stockholder's equity until
          realized.  

          A decline in the fair value of any available for sale or held to
          maturity security below cost that is deemed other than temporary
          is charged to earnings resulting in the establishment of a new
          cost basis for the security.

          Interest income includes interest earned on the securities and the
          amortization of premiums and accretion of discounts of the related
          held to maturity securities as an adjustment to yield using the
          effective interest method.  Realized gains or losses on securities
          sold are recognized on the trade date using the specific
          identification method.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(1)  Summary of Significant Accounting Policies

     (e)  Loans

          Loans are stated at the principal amount outstanding adjusted for
          unearned discounts, unamortized premiums and net deferred fees.
          Loan origination fees and certain direct origination costs are
          deferred and amortized over the contractual life of the related
          loans using the interest method.

     (f)  Mortgage Banking Activities

          Mortgage loans held for sale are recorded at the lower of
          aggregate cost or estimated market value.  Net unrealized losses
          are recognized through a valuation allowance by charges to
          earnings.

          Gains and losses on loan sales are recognized on trade date and
          are determined by the difference between net sales proceeds and
          the carrying value of the mortgage loans sold.  When servicing is
          retained, an additional gain or loss may be recognized based upon
          the net present value of expected amounts to be received or paid
          resulting from the difference between the contractual interest
          rates received from the borrowers and the rates paid to the buyers
          excluding a normal loan servicing fee, securitization fees and
          costs, and considering estimated prepayments on such loans.  The
          resulting excess loan interest income (excess loan servicing fees
          capitalized) is amortized over the estimated remaining life of the
          loans using the interest method.

          The cost of acquiring the right to service mortgage loans is
          capitalized and amortized in proportion to and over the period of
          estimated net servicing income based on the interest method.

          Fees related to the servicing of mortgage loans for the benefit of
          others are determined on the basis of loans serviced and are
          recorded as income when payments are received.

          Statement of Financial Accounting Standards No. 122, Accounting
          for Mortgage Servicing Rights, an amendment of FASB Statement No.
          65, was issued in May 1995.  The Statement requires mortgage
          banking enterprises to recognize as separate assets the rights to
          service mortgage loans for others, however those rights are
          acquired, eliminating the previously existing accounting
          distinction between servicing rights acquired through purchase
          transactions and those acquired through loan originations.  The
          provisions of the Statement will be applied prospectively
          beginning in fiscal 1996.  The expected impact to the financial
          statements in 1996 is not material.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(1)  Summary of Significant Accounting Policies

     (g)  Allowance for Loan Losses
          
          The Company's provision for loan losses charged to operations is
          based upon management's evaluation of the loan portfolio.  The
          allowance for loan losses is maintained at an amount management
          deems adequate to provide for potential loan losses considering
          the character of the loan portfolio, economic conditions, analysis
          of specific loans and historical loss experience.  While
          management uses available information to recognize losses on
          loans, future additions to the allowance may be necessary based on
          changes in economic conditions.  In addition, various regulatory
          agencies, as an integral part of their examination process,
          periodically review the Company's allowances for loan losses. 
          Such agencies may require the Company to recognize additions to
          the allowance based on their judgements about information
          available to them at the time of their examination.

          The accrual of interest on impaired loans is discontinued when
          loans are contractually ninety days past due or in management's
          opinion, the borrower may be unable to meet payments as they
          become due.  When interest accrual is discontinued, all unpaid
          accrued interest is reversed.  Income is subsequently recognized
          only to the extent cash payments are received and the principal
          balance is expected to be recovered.  Such loans are restored to
          an accrual status only if the loan is brought contractually
          current and the borrower has demonstrated the ability to make
          future payments of principal and interest.

          The Company adopted the provisions of Statement of Financial
          Accounting Standards  No. 114, Accounting for Creditors for
          Impairment of a Loan as amended by FASB Statement No. 118,
          Accounting by Creditors for Impairment of a Loan - Income
          Recognition and Disclosures in 1995.  The Statement provides
          guidance in defining and measuring loan impairment.  A loan is
          considered impaired when, based on current information and events,
          it is probable that a creditor will be unable to collect all
          amounts of principal and interest under the original terms of the
          agreement.  Accordingly, the Company measures certain impaired
          commercial mortgage loans based on the present value of expected
          future cash flows, discounted at the loan's effective interest
          rate or, at the loan's observable market price or fair value of
          collateral.  The Statement does not apply to large groups of small
          balance, homogeneous loans that are collectively evaluated for
          impairment.  The Statement did not have a material impact on the
          Company's 1995 consolidated financial statements.

     (h)  Premises and Equipment

          Premises and equipment are recorded at acquired cost less
          accumulated depreciation.  Depreciation and amortization are
          calculated primarily using the straight-line method over the
          estimated useful lives of the depreciable asset.  The lives used
          to compute depreciation and amortization are 30 to 50 years for
          buildings, the lesser of the lease term or estimated useful life
          for leasehold improvements, and 5 to 10 years for equipment.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(1)  Summary of Significant Accounting Policies

     (i)  Foreclosed Real Estate

          Foreclosed real estate represents property acquired through, or in
          lieu of, foreclosure.  At acquisition, foreclosed real estate is
          valued at the lower of fair value or the carrying amount,
          including related costs incurred to acquire the property at
          acquisition.  Subsequent to acquisition, foreclosed real estate is
          carried at the lower of the carrying amount or fair value less
          estimated costs to sell.  Foreclosed real estate is included in
          other assets.

     (j)  Financial Instruments

          The Company holds various derivative financial instruments to
          hedge exposure to fluctuating interest rates.  The Company is not
          an issuer of any financial instrument derivatives.

          Interest-Rate Exchange Agreements.  Interest-rate
          exchange agreements (swaps) used in asset/liability
          management activities are accounted for using the
          accrual method.  Net interest income  (expense)
          resulting from the differential between exchanging
          floating and fixed-rate interest payments is recorded
          on a current basis.  Gains or losses, if any, on
          terminated swaps used in asset/liability management
          activities are deferred and amortized into interest
          income or expense over the original maturity period of
          the swap.

          Interest Rate Caps.  Premiums paid  for interest  rate caps are
          capitalized and amortized  into  interest expense over the
          contractual terms of the cap.  Interest received  under  the 
          terms of  the caps is  accrued  and  recorded as a reduction of 
          interest expense.

          Options.  Option premiums paid are capitalized and amortized to
          income over the exercise period of the option, while realized
          gains on exercised options are deferred and amortized over the
          term of the expected benefit.

          Other Off-Balance-Sheet Instruments.  In the ordinary course of
          business the Company has entered into off-balance-sheet financial
          instruments consisting of commitments to extend credit and forward
          commitments to sell securitized loans.  Such financial instruments
          are recorded in the financial statements when they are funded or
          related fees are incurred or received.

          Although off-balance sheet derivative financial instruments do not
          expose the Company to credit risk equal to the notional amount,
          the Company is exposed to credit risk to the extent of the fair
          value gain of an off-balance sheet derivative financial instrument
          if the counterparty fails to perform.  The Company minimizes the
          credit risk in these instruments by dealing only with highly rated
          counterparties who have credit ratings of investment grade as
          rated by the major rating agencies.  Each transaction is
          specifically approved for applicable credit exposure.

     

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(1)  Summary of Significant Accounting Policies

     (k)  Securities Sold under Agreements to Repurchase

          The Company enters into sales of mortgage-backed securities under
          agreements to repurchase. These agreements are financing
          transactions, and as a result, sales proceeds are treated as
          borrowings and reflected as liabilities in the consolidated
          statements of financial condition.  The amount of the securities
          underlying the agreements remains in the asset account. The
          securities underlying the agreements were delivered to dealers who
          arranged the transactions.  The dealers may have sold, loaned or
          otherwise disposed of the securities to other parties in the
          normal course of their operations, and have agreed to return
          substantially identical securities to the Company at the maturity
          of these agreements.

     (l)  Income Taxes
     
          Deferred tax assets and liabilities are recognized for future tax
          consequences attributable to differences between the financial
          statement carrying amounts of existing assets and liabilities and
          their respective tax basis.  Deferred tax assets and liabilities
          are reflected at currently enacted income tax rates applicable to
          the period in which the deferred tax assets or liabilities are
          expected to be realized or settled.  As changes in tax laws or
          rates are enacted, deferred tax assets and liabilities are
          adjusted through the provision for income taxes.

     (m)  Other Standards

          The Company maintains compensation plans which provide for grants
          of stock options and restricted stock to officers.  As described
          in Note 16, the Company currently follows Accounting Principles
          Board Opinion No. 25, Accounting for Stock Issued to Employees in
          accounting for its plans.  In October 1995, the FASB issued 
          Statement No. 123 entitled Accounting for Stock-Based Compensation
          which encourages, but does not require, companies to use a fair
          value based method of accounting for stock-based employee
          compensation plans.  Under this method, compensation cost is
          measured as of the date stock awards are granted based on the fair
          value rather than the intrinsic value of the award, and such cost
          is recognized over the service period, which is usually the
          vesting period.  If a company elects to continue using the
          intrinsic value based method under Opinion 25, pro forma
          disclosures of net income and net income per share are required,
          as if the fair value based method had been applied.  The Company's
          current policy substantially complies with the requirements of
          Statement 123.

     (n)  Reclassifications

          Reclassifications are made to prior year financial statements
          whenever necessary to conform with the current year presentation.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(2)  Cash and cash equivalents
Cash and cash equivalents as of December 31, 1995 and 1994 follows
     (amounts in thousands):

                                                1995         1994
Federal funds sold-overnight           $ 77,025     $ 20,679
     Federal funds sold-term                  65,800       22,000
     Time deposits                                 -       85,000
     Other interest bearing accounts          26,813       24,726
                                             169,638      152,405
     Cash                                     57,547       62,958     
                                            $227,185     $215,363
(3)  Securities
The amortized costs and estimated fair values of securities as of
     December 31, 1995 and 1994 follows (amounts in thousands):

                                                  Gross         Gross
                                  Amortized   Unrealized   Unrealized    Estimated
               1995                    Cost        Gains       Losses   Fair Value
Securities held to maturity:
      Mortgage-backed
       securities:
        FHLMC                      $128,064       $  797       $  249     $128,612          
        FNMA                         54,685          141          152       54,674          
        GNMA                            207           17            -          224            
        Conventional                 67,478            8        1,448       66,038
      U.S. Treasury bills             4,964           12            -        4,976
      U.S. Treasury notes            45,038          199           10       45,227
      U.S. Government
       and agency bonds                  24            -            -           24

        Total securities held
         to maturity               $300,460       $1,174       $1,859     $299,775

    Securities available for sale:
      Debt securities:
       Mortgage-backed                                                                        
        securities:                        
        Conventional               $ 94,145       $1,255       $    -     $ 95,400                     
        FHLMC                       285,877        2,047          728      287,196
        FNMA                        201,919          870        1,362      201,427
        GNMA                         15,705          210            -       15,915
       U.S. Treasury notes           29,018          224            -       29,242
        Total debt securities       626,664        4,606        2,090      629,180

      Equity securities:
       Other securities                 215            -            -          215

        Total securities
       available for sale          $626,879       $4,606       $2,090     $629,395
CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements
(3) Securities, Continued
                                                    Gross        Gross
                                   Amortized   Unrealized   Unrealized    Estimated
              1994                      Cost        Gains       Losses   Fair Value
Securities held to maturity:
      Mortgage-backed
       securities:                                                                           
        FHLMC                     $  542,148         $116      $21,550   $  520,714
        FNMA                         312,260           76       21,097      291,239
        GNMA                          15,722           33          605       15,150
        Conventional                 211,274          251        3,270      208,255
      U.S. Treasury bills             18,147            -           97       18,050          
      U.S. Treasury notes             59,963            -        1,184       58,779
      U.S. Government
       and agency bonds                   24            -            -           24

        Total securities 
       held to maturity           $1,159,538         $476      $47,803   $1,112,211

    Securities available for sale:
      Debt securities:
       Mortgage-backed
        securities:
        FHLMC                     $    8,687         $  -      $   422   $    8,265
        FNMA                          13,326           40          255       13,111
        GNMA                          45,346           61        1,230       44,177
        
        Total debt securities         67,359          101        1,907       65,553
      Equity securities:
       Other securities                  210            -            -          210

        Total securities
       available for sale         $   67,569         $101      $ 1,907   $   65,763
Under the one-time opportunity allowed by the Financial Accounting 
     Standards Board ("FASB") to reassess the designation of securities, 
     the Company transferred securities with an amortized cost of 
     $684,823,465 and a fair value of $690,293,630 from held to maturity 
     to available for sale in November 1995.  As provided in the FASB 
     guidance, the one-time transfer does not call into question 
     management's ability and intent to hold securities to maturity.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(3) Securities, Continued

    Proceeds from the sale of securities available for sale for the years
    ended December 31, 1995 and 1994 were $143,028,000 and $160,634,000,
    respectively.  Gross gains and (gross  losses) realized on these sales
    of securities available for sale were $3,974,000 and $(0), respectively,
    for the year ended December 31, 1995 and $216,000 and $(77,000),
    respectively, for the year ended December 31, 1994.

    GNMA, FHLMC and FNMA mortgage-backed certificates with a carrying value
    of $545,910,000 and $490,780,000 at December 31, 1995 and 1994 were sold
    under  agreements to repurchase (See Note 10).

    FHLMC mortgage-backed certificates with a carrying value of $9,230,000
    and $11,054,000 at December 31, 1995 and 1994 were pledged as collateral
    for the collateralized mortgage obligations issued by the Company (See
    Note 11).
The amortized cost and estimated fair value of debt securities at
    December 31, 1995 by contractual maturity follows (amounts in
    thousands):

                                  Held to Maturity         Available for Sale 

                               Amortized   Estimated    Amortized    Estimated
                                    Cost  Fair Value         Cost   Fair Value
One year or less           $ 34,903    $ 35,086     $  4,635      $ 4,883
     After one year
      through five years         134,951     135,191      151,782      153,283
     After five years
      through ten years           44,223      44,043      189,945      188,207
     After ten years              86,383      85,454      280,302      282,807
                                $300,460    $299,775     $626,664     $629,180
CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(4)  Loans
A summary of loans as of December 31, 1995 and 1994 follows (amounts in
     thousands):

                                                         1995           1994
Mortgage loans:
      Conventional:
       one to four family residential-fixed        $  199,878     $  151,647 
       one to four family residential-variable      4,697,820      3,980,857 
       commercial and construction                    401,125        357,777 
      FHA insured and VA guaranteed                   106,015        106,609 

               Total mortgage loans                 5,404,838      4,596,890 

    Other loans:
      Second mortgage                                 220,952        232,892 
      Home improvement                                  7,557          9,773 
      Student                                          82,629         72,281 
      Other consumer                                   23,117         19,594 

               Total other loans                      334,255        334,540 

               Total loans                          5,739,093      4,931,430 

      Allowance for loan losses                       (38,842)       (35,373)
      Unearned net loan premiums and fees              37,958         24,248 

               Loans, net                          $5,738,209     $4,920,305
The interest rates on adjustable-rate residential mortgage loans held in
    the Company's portfolio generally float at designated spreads above
    indices based on U.S. Treasury securities.  The loans are generally
    subject to caps on increases in the rate of interest.  Adjustable-rate
    loans may provide for initial rates of interest below the rates that
    would prevail if the market rate indices used for repricing were applied
    initially.  Adjustable-rate mortgages pose potential additional risks,
    primarily because as interest rates rise, the mortgage payments by the
    borrowers rise as a result of periodic repricing, increasing the
    potential for default.

                                     

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(4) Loans, Continued
The following summarizes activity in the allowance for loan losses for
    the years ended December 31, 1995 and 1994 (amounts in thousands):

                                              1995          1994
Balance, beginning of year            $ 35,373      $ 48,461 
    Provision for loan losses               15,336        16,211 
    Loans charged-off                      (14,020)      (21,482)
    Reduction for non-performing
     loan sale                                   -        (9,919)
    Recoveries                               2,153         2,102 

    Balance, end of year                   $38,842       $35,373
In 1994, the Company sold $40,862,800 of non-performing loans and
    foreclosed real estate.  Cash proceeds of the sale were $27,929,400 and
    related valuation allowances at sale date were $9,919,000.  The
    remaining $3,014,400 loss was charged to earnings.

    The principal balance of residential mortgage loans not accruing
    interest as of December 31, 1995 and 1994 amounted to $32,857,000 and
    $19,761,000.  The effect on interest income for non-accrual residential
    loans was $2,942,000 and $2,267,000 for the years ended December 31,
    1995 and 1994.

    Impaired commercial mortgage loans were $4,536,000 at December 31, 1995
    and the total allowance for loan losses related to these loans was
    $2,797,000.  Commercial mortgage loans with modified payment terms were
    immaterial at December 31, 1995 and 1994.  The effect on interest income
    of impaired loans was not material to the consolidated financial
    statements in 1995 and 1994.  The Company is not committed to lend
    additional funds to these borrowers.

    As of December 31, 1995, approximately 28.6% of the outstanding
    principal balance of the Company's residential mortgage loan portfolio
    was located in New York State, 10.2% in New Jersey, and 9.4% in
    Maryland.  The balance was secured by properties located in 45 states,
    with no other state or territory accounting for 8.5% or more of the
    portfolio.  As of December 31, 1995, approximately 83.5% of the
    outstanding principal balance of the Company's portfolio of multi-
    family, commercial and construction mortgage loans was secured by
    properties located in New York State, and 10.2% in New Jersey.  The
    balance was secured by properties located in 18 states, with no other
    state accounting for 2% or more of the portfolio.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(4) Loans, Continued
Total non-performing mortgage loans (including residential, commercial,
    and construction real estate loans) by geographic region as of December
    31, 1995 and 1994 follows (amounts in thousands):

                                   1995                   1994       
                             Amount       %         Amount       %
New York                $20,678    55.3%       $14,243    62.4%
    New Jersey                5,011    13.4          4,040    17.7 
    Connecticut               4,151    11.1          3,515    15.4 
    All other states          7,553    20.2          1,028     4.5 

        Total               $37,393   100.0%       $22,826   100.0%
(5) Mortgage Banking Activities

    Mortgage loans includes loans held for sale (which are principally
    residential loans) of $95,974,000 and $18,054,000 as of December 31,
    1995 and 1994.  Proceeds from the sale of loans held for sale were
    $439,714,000 and $508,516,000 for the years ended December 31, 1995 and
    1994.  Net gain(loss) on sales of loans was $2,220,000 and $(572,000)
    for the years ended December 31, 1995 and 1994.  No significant income
    statement impact is anticipated from the disposition of the loans held
    for sale.

    Loans serviced for others, amounting to $6.1 billion and $3.8 billion at
    December 31, 1995 and 1994 are not included in the consolidated
    financial statements.  Custodial escrow balances maintained in
    connection with the foregoing loan servicing were $87,143,932 and
    $67,162,515 at December 31, 1995 and 1994.
The following analysis reflects the changes in loan servicing rights
    acquired (purchased) and excess loan servicing fees capitalized
    (retained) balances for the years ended December 31, 1995 and 1994
    (amounts in thousands):

                                         Purchased      Retained
Balance December 31, 1993           $ 19,242       $18,250 
       Additions                            14,187         2,407      
       Amortization                         (4,367)       (3,426)
      Balance December 31,1994              29,062        17,231 
       Additions                            35,444           688 
       Amortization                         (5,488)       (2,824)
      Balance December 31, 1995            $59,018       $15,095
CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(5) Mortgage Banking Activities, Continued

    In June 1995, the Company, through the Subsidiary, acquired the
    outstanding common stock of Sibley Mortgage Corporation (Sibley) for $20
    million in cash.  Sibley's primary business was the origination,
    purchase, sale and servicing of residential and multi-family loans.  The
    acquisition was recorded using the purchase method of accounting. 
    Accordingly, purchased mortgage servicing rights of $14.3 million and
    goodwill of $4.2 million were recorded.  Goodwill is being amortized on
    a straight-line method over 10 years.

(6) Accrued Interest Receivable
Accrued interest receivable as of December 31, 1995 and 1994 follows
    (amounts in thousands):

                                              1995          1994
Loans                              $37,003       $29,657 
        Securities                           6,171         7,066 
        Other assets                         1,117         1,060 
                                           $44,291       $37,783
(7) Premises and Equipment
A summary of premises and equipment as of December 31, 1995 and
        1994 follows (amounts in thousands):

                                              1995          1994
Land                              $  3,369      $  3,408 
        Office buildings                    30,117        27,933 
        Furniture and equipment             41,575        35,365 
        Leasehold improvements              15,272        13,227 
                                            90,333        79,933 
        Less accumulated depreciation
         and amortization                  (33,548)      (23,720)
                                          $ 56,785      $ 56,213 

    Depreciation and amortization expense was $9,361,000 and $7,675,000 for
    the years ended December 31, 1995 and 1994.
CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(8)     Deposits
A summary of deposits and  interest rates as of December 31, 1995 and
    1994 follows (amounts in thousands):

                                       1995                    1994         
                                          Year End                Year End
                                          Interest                Interest
                                  Amount      Rate        Amount      Rate
Demand deposits
     and NOW accounts         $  389,423      .78%    $  386,995      .95%

    Passbook, statement
     and club accounts         1,048,225     2.95      1,222,444     2.85 
    Insured money market
     funds                       509,021     3.71        502,697     3.04 
                               1,557,246     3.20      1,725,141     2.91 

    Certificates of
     deposit maturing:
        12 months or less      1,842,879     5.89      1,477,253     4.67 
        13-24 months             201,238     5.97        200,834     5.48 
        25 months or longer      219,716     6.21        240,974     5.86      
                               2,263,833     5.93      1,919,061     4.90 
                              $4,210,502     4.44%    $4,031,197     3.67%

    Jumbo certificates of deposit were $210,961,000 and $156,883,000 at
    December 31, 1995 and 1994.
Interest expense on deposits for the years ended December 31, 1995 and
    1994 follows (amounts in thousands):

                                              1995           1994
Demand deposits and NOW accounts      $  3,444       $  3,904
    Passbook statement and club accounts    33,286         40,198
    Insured money market funds              17,793         15,995
    Certificates of deposit                119,488         71,474
    Interest on Swaps, net                  (1,834)           950

                                          $172,177       $132,521
CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements
(9) Advances From Federal Home Loan Bank

    Advances from the Federal Home Loan Bank of New York as of December 31,
    1995 and 1994 consisted of the following (amounts in thousands):

                          1995                           1994           
                           Weighted Average               Weighted Average     
    Due Date        Amount    Interest Rate        Amount    Interest Rate
1995      $        -           -%        $  516,043        5.43%   
      1996         889,742        5.97            573,784        5.98    
      1997         378,161        6.25            354,669        5.82    
      1998         352,174        6.68             25,000        5.51    
      1999           8,500        7.94              8,500        7.94    
      2000          50,000        6.07                  -           -    
      2001          25,518        6.95             25,518        6.95    
      2002             702        2.67                702        2.67    
      2005           5,500        6.35                  -           -    
      2006             256        6.02                256        6.02    
      2007             402        6.45                402        6.45    
                $1,710,955                     $1,504,874
The Company has pledged qualifying collateral, primarily mortgage loans,
    with a market value of at least 110% of the amount of the advances.  The
    Company has an available line of credit with Federal Home Loan Bank of
    New York equal to 30% of total assets exclusive of withdrawal advances. 
    The Company is required to hold stock in the Federal Home Loan Bank of
    New York in an amount equal to the greater of 5% of the outstanding
    advance balance or 1% of eligible mortgage loans.

(10)  Securities Sold Under Agreement to Repurchase

    Securities sold under agreements to repurchase as of December 31, 1995
    and 1994 were $570,648,000 and $498,077,000, respectively.  These
    securities are collateralized by mortgage-backed securities with a fair
    value of $545,227,000 and $465,985,000 at December 31, 1995 and 1994.

    The securities sold under agreements to repurchase had a weighted
    average borrowing rate of 6.04% and 4.15% for the years ended Decem-
    ber 31, 1995 and 1994.  Such borrowings had an average outstanding
    balance of approximately $545,928,000 and $403,766,000 for the years
    ended December 31, 1995 and 1994 with the maximum amounts outstanding at
    any month end during these periods of approximately $611,883,000 and
    $524,641,000.   All such borrowings mature within one year.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements
(11)  Collateralized Mortgage Obligations

    In April and August 1986, First Federal Capital Corporation, a wholly
    owned subsidiary of the Subsidiary issued collateralized mortgage bonds
    ("Bonds") of $12,496,000 and $19,542,000.  The Bonds are general
    obligations of the corporation and are collateralized by a pledge of
    FHLMC mortgage-backed certificates with a carrying value of $9,230,000
    and $11,054,000 at December 31, 1995 and 1994.  All payments received on
    the pledged mortgage-backed securities, net of certain costs, must be
    applied to repay the Bonds.  It is expected that the actual life of the
    Bonds will be less than their stated maturity.  A schedule of the Bonds
    outstanding as of December 31, 1995 and 1994 follows (amounts in
    thousands):

                                1995                   1994        
                                    Stated                Stated 
    Maturity               Amount     Rate       Amount     Rate
January, 2000         $ 2,864     7.33%      $3,780     7.33%                    
    September, 2002         3,231     7.89        3,959     7.89 
    October, 2006           2,436     7.27        2,179     7.27 
                          $ 8,531                $9,918
(12)  Senior and Subordinated Debt
Senior and subordinated debt is comprised of three notes payable to CT
    North America L.L.C., amounts outstanding as of December 31, 1995 and
    1994 follow (amounts in thousands):

                                                          1995      1994
Floating Rate Unsecured Senior Capital 
     Note due April 25, 1997.  Interest only
     payable semi-annually, based on the
     current six month LIBOR rate plus 4.5%            $25,000   $25,000
    
    Fixed Rate Unsecured Subordinated Capital 
     Note due March 25, 2003.  Interest only
     payable semi-annually.  Interest fixed at 
     8.25%. Obligation is subordinate to obligation
     under Floating Rate Unsecured Senior
     Capital Note                                       28,000    28,000

    Floating Rate Unsecured Subordinated 
     Capital Note due March 10, 2005.  
     Interest only payable semi-annually, based 
     on the current six month Libor rate plus 1.0%.     29,000         -
                                                       $82,000   $53,000
The Company may redeem all or part of the outstanding principal amount
    of the notes at specific redemption prices, plus accrued interest as
    follows:

                                Redemption Price as of % of Principal       
                                $25,000            $29,000           Fixed  
     Year of Redemption    Floating Rate Note  Floating Rate Note  Rate Note
1995                         100.5%             102.0%           100.0% 
    1996                         100.0              101.0            100.0  
    1997 and thereafter          100.0              100.0            100.0
CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(13)  Income Taxes
Tax Provision

    Income taxes for the years ended December 31, 1995 and 1994 were
    allocated as follows (amounts in thousands):

                                              1995         1994
Taxes charged to operations          $29,043      $24,411 

      Taxes charged to stockholder's
        equity, for net unrealized gain
       (loss) on certain securities          1,858         (776)
                                           $30,901      $23,635
The components of the provision for income tax expense (benefit) charged
    to operations for the years ended December 31, 1995 and 1994 are as
    follows (amounts in thousands):

                                              1995         1994
Current:
        Federal                            $25,196      $ 9,531 
        State and local                      8,838        3,804 
                                            34,034       13,335 
      Deferred:
        Federal                             (4,290)       7,918      
        State and local                       (701)       3,158 
                                            (4,991)      11,076 
                                           $29,043      $24,411
Reconciliation of Expected Federal Statutory Rate to Actual Rate
The provision for federal income taxes from continuing operations is
    based on income before taxes at the statutory rate of 35% for the years
    ended December 31, 1995 and 1994 adjusted for the following differences
    (amounts in thousands):

                                              1995       1994
Income tax at statutory rate         $24,938    $19,774 

      Increase (Reduction) in income
        taxes resulting from:
          State and local income taxes,
            net of Federal benefit           5,289      4,525 
          Change in valuation allowance
            for deferred tax assets         (1,164)      (291)
          Other differences                    (20)       403 
      Provision for income taxes           $29,043    $24,411
CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(13)  Income Taxes, Continued
Deferred Taxes

    The tax effects of temporary differences that give rise to significant
    portions of the deferred tax assets and liabilities at December 31, 1995
    and 1994 are presented below.

                                                   1995       1994
Deferred tax assets:
         Loan valuation allowance              $ 18,743   $ 16,913 
         Intangible asset amortization            3,092      5,770 
         Compensation and benefits                5,001      3,990 
         Purchase accounting - discounts          4,116      2,933      
         Net unrealized loss on securities
          available for sale                          -        776 
         Fixed assets                             1,331      1,900 

      Total gross deferred assets                32,283     32,282 
         Less valuation allowance               (16,747)   (17,911)     
            Net deferred tax assets              15,536     14,371 

      Deferred tax liabilities:
         Tax bad debt reserve                    10,844      9,784      
         Deferred origination income                544        994 
         Loan servicing rights                    2,849      2,217 
         Purchase accounting - premiums           9,477     12,375 
         Net unrealized gain on securities
           available for sale                     1,082          - 
         Other                                    2,222      3,613 

      Total gross deferred tax liabilities       27,018     28,983 

      Net deferred tax liability, included in
        other liabilities                       $11,482    $14,612
The net change in the valuation allowance for deferred tax assets was a
    decline of $1,164,000 and $291,000 for the years ended December 31, 1995
    and 1994, respectively.

    Realization of deferred tax assets is dependent upon the generation of
    future taxable income or the existence of sufficient taxable income
    within the carryback period.  A valuation allowance is provided when it
    is more likely than not that some portion of the deferred tax assets
    will not be realized.  In assessing the continuing need for a valuation
    allowance, management considers the scheduled reversal of the deferred
    tax liabilities, the level of historical taxable income and projected
    future taxable income over the periods in which the temporary
    differences comprising the deferred tax assets will be deductible.  

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(14)  Financial Instruments

    a)   Interest Rate Swaps
Interest rate swaps entitle the Company to receive variable interest
      payments based on specified spreads over various London Interbank Bid
      and Offer Rates (LIBOR), in exchange for fixed interest payments. 
      The following summarizes the terms and characteristics of interest
      rate swaps as of December 31, 1995 and 1994 (dollar amounts in
      thousands):

                                         1995           1994
Carrying amount (including
        accrued interest)               $(822)       $(1,142) 
      Fair value                          242          2,514  
      Hedged item                  3 Month CD's   3 Month CD's
      Notional amount                 $85,000        $200,000 
      Original term to maturity         3 yrs.     2 to 3 yrs.
      Weighted average maturity      3 months            1 yr.
      Weighted average interest
        rate receivable                  5.81%          5.69% 
      Weighted average interest 
        rate payable                     4.69%          4.42%
Net interest (income) expense from interest rate swaps for the years
      ended December 31, 1995 and 1994 was $(1,834,478) and $949,792 which
      is included in interest expense on deposits.

    b)   Interest Rate Caps
Interest Rate Caps entitle the Company to receive interest payments
      in exchange for payment of a premium, provided the 3 month LIBOR rate
      exceeds the cap rate.  The following summarizes the terms and
      characteristics of the cap agreements as of December 31, 1995 and
      1994 (dollar amounts in thousands):

                                              1995       1994
Carrying amount
        (including accrued interest)      $  5,329   $  5,782 
      Fair value                             2,663     15,756 
      Notional amount                      550,000    312,500 
      Weighted cap rate                       5.56%      4.81%
      Weighted term to maturity               1 yr.      2 yr.
The Company recognized interest income of $4,408,000 for the year
      ended December 31, 1995 and $2,375,000 in 1994.  Amortized premiums
      for the years ended December 31, 1995 and 1994 were $4,333,000 and
      $2,957,000.  The income received and amortized premium expense were
      included in interest expense on FHLB advances.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(14)  Financial Instruments, Continued
c)   Put Options

      The Company purchases put options on Eurodollar futures contracts, in
      order to offset for the potential effect of rising rates on interest
      margin.  Eurodollar futures are indexed to LIBOR.  The following
      summarizes the terms and characteristics of the put options as of
      December 31, 1995 and 1994 (dollar amounts in thousands):

                                        1995                  1994
Carrying amount                   $917                $   985     
      Fair value                         148                 13,808     
      Instrument underlying
        put option                Eurodollar futures    Eurodollar futures
      Contract amount                 $1,875,000           $4,700,000   
      Option expiration dates       March 17, 1997      December 18, 1995
      Strike price                  92.25 to 95.75       92.50 to 94.50
The amount of option premiums amortized and charged to income for the
      years ended December 31, 1995 and 1994 was $6,512,000 and $8,586,000. 
      Amortized gains from sold option contracts were $3,685,000 in 1995
      and $5,400,000 in 1994 and were offset against interest expense on
      FHLB advances.  Unamortized premiums at December 31, 1995 and 1994
      were $928,000 and $3,678,000. Unamortized gains at December 31, 1995
      and 1994 were $11,000 and $2,693,000.
d)   Call Options

      The Company purchases call options on Eurodollar futures contracts
      and Treasury Notes, in order to offset for the potential effect of
      falling rates on interest margin.  Eurodollar futures are indexed to
      LIBOR. The following summarizes the terms and characteristics of the
      call options as of December 31, 1995 (dollar amounts in thousands):

                                        1995                  1994
Carrying amount (including
        net deferred gains)           $  (812)                $489       
      Fair value                        3,364                  183       
      Instrument underlying       Eurodollar futures    Eurodollar futures
        call option               and Treasury Notes    
      Contract amount                $1,432,000             $5,850,000    
      Option expiration dates       June 17, 1996         March 18, 1995  
      Strike price                  93.25 to 95.50        93.75 to 94.75
The amount of option premiums amortized and charged to income for the
      years ended December 31, 1995 and 1994  was $992,000 and $244,000. 
      Amortized gains from sold option contracts in 1995 and 1994 were
      $1,211,000 and $0. Unamortized premiums at December 31, 1995 and 1994
      were $728,000 and $489,000.  Unamortized gains at December 31, 1995
      and 1994 were $1,540,000 and $0.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(15)  Employee Benefits

    a)   Retirement Plans

      The Company has a non-contributory defined benefit pension plan
      covering substantially all employees.  The plan provides pension
      benefits that are based on each employee's years of service and
      average compensation prior to retirement.  The Company's funding
      policy is to contribute annually at least the minimum required by
      law.  Plan assets are invested in the general account and certain
      separate accounts of The New England Company and Morgan Stanley.
For the years ended December 31, 1995 and 1994, the net
      pension cost is summarized as follows (amounts in thousands):

                                              1995         1994
Service cost                      $ 1,042       $1,357 
         Interest cost                       2,498        2,301 
         Return on plan assets              (2,415)      (2,156)
         Net amortization and
            deferral                          (115)        (174)     

         Net periodic pension cost         $ 1,010      $ 1,328
The following schedule reconciles the funded status of the plan as of
      December 31, 1995 and 1994 (amounts in thousands):

                                              1995                 1994
Estimated fair value of plan
       assets                                    $ 32,296              $ 31,748 
      Benefit obligations:
        Vested benefit obligation      (25,215)              (24,337)
        Accumulated benefit 
         obligation                    (25,827)              (24,830)
        Projected benefit obligation              (32,068)              (32,318)
      Unrecognized net loss                         4,434                 3,906 
      Unrecorded prior service cost                  (705)                 (833)
      Remaining unrecognized net
       transition asset                              (111)                 (238)

         Net pension asset
            recognized in the 
            consolidated statement 
            of financial condition 
            as of December 31, 1995
            and 1994                              $ 3,846               $ 2,265
CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(15)  Employee Benefits, Continued

    a)   Retirement Plans, Continued
Certain assumptions utilized in the calculation summarized on the
      previous page are as follows:

                                                 1995       1994
Assumed discount rate                      8.25%      7.50%
      Assumed rate of compensation increase      6.00       6.00 
      Expected long term rate of return on
         plan assets                             8.25       7.50
The Company also has a 401(K) Salary Reduction Profit Sharing Plan in
      which substantially all employees are eligible to participate.  Total
      expense for this plan was $746,734 and $722,844 for the years ended
      December 31, 1995 and 1994.

      The Company maintains certain non qualified retirement plans (i.e.,
      Supplemental Employee Retirement Plan and Directors Retirement Plan)
      for key officers and directors.  Certain of these plans are funded
      annually, and the net periodic pension cost recorded for these plans
      was $304,672 and $242,808 for the years ended December 31, 1995 and
      1994.

    b)   Post Retirement Benefits

      The Company sponsors a defined benefit post retirement medical plan
      that covers all of its full time employees.  All employees who retire
      from the Company's defined benefit pension plan who have attained age
      55 with 5 years of service are eligible.  Employees are required to
      contribute a portion of the premium based on their age and service at
      retirement.  Spouses pay the full premium.  The plan is not funded. 
      Upon adoption of SFAS No. 106, the Company recorded the entire
      accumulated post retirement benefit obligation on May 1, 1991. 

      

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(15)  Employee Benefits, Continued

    b)   Post Retirement Benefits, Continued
Net periodic postretirement benefit cost for the years ended December
      31, 1995 and 1994 included the following components (amounts in
      thousands):

                                                  1995       1994
Service cost - benefits
        attributed to service
        during the period                        $ 472      $ 498 
      Interest cost                                519        527 
      Net amortization and
        deferral                                   (95)       (36)
      Net periodic postretirement
        benefit cost                             $ 896      $ 989
The following table sets forth the plan's funded status reconciled
      with the amount shown in the Company's financial statements at
      December 31, 1995 and 1994 (amounts in thousands):

                                                  1995       1994
Accumulated postretirement benefit
        obligation:
           Retired employees                   $(5,123)   $(2,067)
           Active employees                     (1,544)    (5,329)
           Total                                (6,667)    (7,396)
      Plan assets at fair value                      -          - 
      Unfunded accumulated benefit obligation
         in excess of plan assets               (6,667)    (7,396)
      Unrecognized net gain                     (1,464)       (80)
      Unrecognized prior service cost             (473)      (509)
      Accrued postretirement medical
         benefit cost                          $(8,604)   $(7,985)
For measurement purposes, a 12.75% annual rate of increase in the per
      capita cost of health care benefits for retirees was assumed for
      1995.  The rate was assumed to decrease gradually to 6.00% by 2006
      and remain at that level thereafter.  The health care cost trend rate
      assumption has a significant effect on the amounts reported.  To
      illustrate, increasing the assumed health care cost trend rates by 1%
      in each year would increase the accumulated postretirement benefit
      obligation at December 31, 1995 by $780,000, and the net periodic
      postretirement benefit cost by $126,000 for the year then ended.  

      The weighted average discount rate used in determining the
      accumulated postretirement obligation was 8.25% for 1995 and 7.50%
      for 1994.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(16)  Stock Option Plans and Stock Grant
On May 8, 1991, the Subsidiary adopted a Non-qualified Stock Option Plan
    (the "Plan") for its officers.  On that date, options were granted to
    purchase 1,004,900 shares of common stock at an exercise price equal to
    the net book value per share at date of grant.  The plan provides for
    subsequent additional awards of stock options based on a formula linked
    to compensation increases.  The basis of subsequent options purchased is
    based on the net book value per share at date of grant.  Subsequent to
    exercise, the optionee may sell the shares back to the Subsidiary at a
    price equal to the current net book value per share.  The right to
    exercise options granted is phased in over a seven year vesting
    schedule.  As of December 31, 1995, 979,590 share options were
    outstanding and become exercisable according to the following schedule:

         Date of Exercisability     Aggregate Number Exercisable
May 8, 1995                   602,100
               May 8, 1996                   749,610
               May 8, 1997                   895,245
               May 8, 1998                   927,900
               May 8, 1999                   951,735
               May 8, 2000                   969,255
               May 8, 2001                   979,590
The following is a summary of the changes in options outstanding during
    1995 and 1994:

                                            Weighted
                                             Average  Redemption
                                Number  Option Price       Price
                             of Shares     per share   per share
Outstanding at 
      December 31, 1993      1,050,000       $ 10.41      $13.54
    Granted                     82,200         13.92           -
    Exercised                 (49,495)         10.52       16.02
    Terminated                (80,550)         11.95           -
    Outstanding at 
      December 31, 1994      1,002,155         10.57       14.93
    Granted                     73,700          5.49           -
    Exercised                 (43,295)         11.68       15.57
    Terminated                (52,970)         12.31           -     
    Outstanding at                     
      December 31, 1995        979,590         10.79       16.84
On May 8, 1991 the Subsidiary also issued 199,487 shares of common stock
    to senior officers, at the book value per share at date of grant.  The
    grantee may sell the stock back to the Subsidiary at a price equal to
    current net book value per share.  The initial cost of the stock grant
    was included as a merger cost and represents the initial minority
    interest.  Shares issued and outstanding at December 31, 1995 and 1994
    were 156,758 and 156,558 respectively.

    The cost of both plans is recognized based on the increased value of all
    shares granted.  The increased value of both plans, which has been
    recorded as compensation expense, was $1,917,594 for the year ended
    December 31, 1995 and $1,333,696 for 1994.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(17)  Commitments and Contingencies
At December 31, 1995 and 1994, the Company had commitments outstanding
    generally for up to 90 days, to originate and purchase loans and
    commitments to sell loans as follows (amounts in thousands):

                                               1995          1994
Commitments outstanding to
         originate and purchase loans      $330,030      $200,695
      Commitments to sell loans             164,319        36,025
      Commitments to purchase 
         mortgage-backed securities          25,000             -
      Commitment to purchase
         interest rate caps                       -         4,946
Substantially all commitments to originate and purchase loans (net of
    commitments to sell loans) are for adjustable rate loans with the
    initial interest rate fixed at the commitment date.

    Under pending federal legislation, is the proposed one-time special
    assessment to recapitalize the SAIF insurance fund.  If enacted in its
    current form, the assessment is estimated to be between 75 to 80 basis
    points of SAIF insured deposits held as of March 31, 1995.  Based upon
    these rates the Company's pre-tax expense would be approximately  $31.4
    million to $33.5 million.  There is no assurance that this pending
    legislation will be enacted into law, therefore, the FASB has stated
    that the charge to earnings must be recorded in the period it is
    enacted.  Accordingly, the Company has made no accrual for this
    potential obligation.

    On February 6, 1995, the Superintendent of Banks for the State of New
    York seized Nationar, a check-clearing and trust company, freezing all
    of Nationar's assets.  On that date, the Company had items in process of
    approximately $2,900,000 with Nationar.  Based on information set forth
    in certain publicly available documents, which by their terms are
    preliminary, management believes that there is a reasonable likelihood
    that the Company will not recover all of its items in process owed by
    Nationar.  In accordance with the Company's normal procedures for
    monitoring asset quality, the Company has established a valuation
    allowance of approximately $200,000 against the items in process with
    Nationar at December 31, 1995.  The foregoing event has not had any
    material effect on the Company's ability to meet their liquidity needs. 
    Management has taken all steps necessary to recover the amounts owed the
    Company by Nationar.
The Company leases certain premises and equipment under various non-
    cancelable operating lease agreements.  At December 31, 1995, the total
    future minimum rental commitments, exclusive of amortization of premiums
    arising from recapitalization, are as follows (amounts in thousands):
1996           $ 3,933
                      1997             3,687
                      1998             3,216
                      1999             2,889
                      2000             2,511
                  Later Years         12,109
The total rental expense was $7,187,442 for the year ended December 31,
    1995 and $6,902,963 for 1994.

    In the conduct of business, the Company is involved in various
    litigation matters.  Management  of the Company, based on its review
    with counsel of the development of these matters, is of the opinion that
    the ultimate disposition of these litigation matters should not have a
    materially adverse effect on the financial position of the Company.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(18)  Fair Values of Financial Instruments

    The following methods and assumptions were used to estimate the fair
    value of each class of financial instruments:
    
    Securities

    Fair values for securities are based on quoted market prices or dealer
    quotes, where available.  Where quoted market prices are not available,
    fair values are based on quoted market prices of comparable instruments.

    Loans

    The fair values of adjustable rate residential real estate loans are
    determined using an option based pricing model.  The cash flows are
    discounted using a rate comprised of an option adjusted spread and the
    appropriate term rate.  The option adjusted spread includes an
    additional spread over that of ARM securities to compensate for the
    added risk associated with whole loans.

    The fair values of fixed rate residential, second mortgage loans,
    consumer loans and commercial mortgages are estimated using a discounted
    cash flow approach, using the appropriate index plus a spread.

    Delinquent loans (not in foreclosure) are valued using the method noted
    above and loans delinquent more than 30 days but less than 91 days
    delinquent, are reduced by an allocated amount of required general
    valuation allowances.  The fair value of loans currently in foreclosure
    is estimated to approximate carrying value, as such loans are generally
    carried at net realizable value.

    Excess Servicing Rights

    Fair value is estimated by discounting the excess net servicing income
    to be received over the estimated servicing term using a current market
    rate.

    Deposits

    The fair value of demand deposits, passbook savings accounts, and
    certain money market accounts is the amount payable on demand at the
    reporting date.  The fair value of fixed maturity certificates of
    deposit is estimated using a discounted cash flow approach that applies
    current market rates (prevailing CD rates) to a schedule of aggregated
    expected monthly maturities on time deposits.

    Advances from Federal Home Loan Bank

    The carrying value of variable rate advances approximates fair value. 
    The fair value of fixed rate advances is estimated using a discounted
    cash flow approach, that applies the current incremental advance
    borrowing rate.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(18)  Fair Values of Financial Instruments, Continued

    Collateralized Mortgage Obligations

    The fair value of these instruments is estimated using a discounted cash
    flow approach that applies current market rates for similarly traded
    instruments.

    Senior and Subordinated Debt

    The carrying value of the variable rate instrument, which reprices every
    six months, approximates fair value.  The fair value of the fixed rate
    instrument is estimated using a discounted cash flow approach that
    applies a current market rate for similar securities.

    Interest rate swaps, caps and options

    The fair value of interest rate swaps and interest rate caps are
    obtained from dealer quotes.  These values represent current settlement
    prices.  The fair value of options is also obtained from dealer quotes.

    Other Financial Instruments

    Based on the characteristics of cash and cash equivalents, FHLB stock,
    accrued interest receivable and payable, securities sold under
    agreements to repurchase, advances from borrowers for taxes and
    insurance and the commitments to purchase or sell loans and securities,
    the carrying value approximates fair value.

                           CTUS AND SUBSIDIARIES
                Notes to Consolidated Financial Statements

(18)  Fair Values of Financial Instruments, Continued
The following table presents the carrying value and the estimated fair
    values of the forementioned Company's financial instruments as of
    December 31, 1995 and 1994 are as follows (amounts in thousands):

                                          1995                     1994           
                                                  (2)                       (2) 
                                 Carrying        Fair      Carrying        Fair 
                                   Amount       Value        Amount       Value
Financial Assets:
      Securities               $  929,855  $  929,170    $1,225,301  $1,177,974      
      Loans, net of 
       loss allowances          5,738,209   5,908,304     4,920,305   4,965,878      
      Excess loan servicing 
       fees capitalized            15,095      18,745        17,231      21,600 
      
    Financial Liabilities:
      Deposits                  4,210,502   4,221,482     4,031,197   3,983,676 
      Advances from Federal 
       Home Loan Bank           1,710,955   1,723,322     1,504,874   1,476,262 
      Collateralized mortgage 
       obligations                  8,531      10,467         9,918      10,368                          

    Off-balance sheet financial
     instruments:  (1)                                                                                   

  
           

      Interest rate swaps:
        Net receivable                277         272           979         979 
        Net payable                (1,099)        (30)       (2,121)      1,535                          

      Interest rate caps            5,329       2,663         5,782      15,756 
      Option premiums                 105       3,512         1,474      13,991 

    (1) Amounts reflected under "carrying amount" represent accruals or
        deferred income (expense) arising from those unrecognized financial
        instruments.

    (2) Fair value estimates are made at a specific point in time, based on
        relevant market information and information about the financial
        instrument.  These estimates are subjective in nature and involve
        uncertainties and matters of significant judgement and therefore
        cannot be determined with precision.  Changes in assumptions could
        significantly affect the estimates.
Exhibit 23

                        Independent Auditors' Consent

The Board of Directors
CTUS:

We consent to the inclusion of our report dated January 12, 1996, with respect
to the consolidated statements of financial condition of CTUS and subsidiaries
as of December 31, 1995 and 1994, and the related consolidated statements of
income, stockholder's equity, and cash flows for the years then ended, which
report appears in the Form 8-K of HSBC Americas, Inc. dated October 22, 1996.
Our report refers to the adoption of Statements of Financial Accounting
Standards (SFAS) Nos. 114 and 118 on January 1, 1995 and SFAS No. 115 on 
January 1, 1994.

                                           /s/ KPMG Peat Marwick LLP

Rochester, New York
October 22, 1996