Citizens Financial Services - 10-K annual report

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<CENTER><FONT FACE="Arial">UNITED STATES</FONT>

<P>SECURITIES AND EXCHANGE COMMISSION

<P>WASHINGTON, D.C. 20549

<P>FORM 10-K

<P><FONT SIZE=+0>[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE</FONT>

<P><FONT SIZE=+0>SECURITIES EXCHANGE ACT OF 1934</FONT>

<P><FONT SIZE=+0>For the fiscal year ended December 31, 1999</FONT>

<P><FONT SIZE=+0>or</FONT>

<P><FONT SIZE=+0>[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE</FONT>

<P><FONT SIZE=+0>SECURITIES EXCHANGE ACT OF 1934</FONT>

<P><FONT SIZE=+0>For the transition period from _________________ to___________________</FONT>

<P><FONT SIZE=+0>Commission file number 0-13222</FONT>

<P><FONT SIZE=+0>CITIZENS FINANCIAL SERVICES, INC.</FONT>

<BR><FONT SIZE=+0>(Exact name of registrant as specified in our charter)</FONT></CENTER>



<BR>&nbsp;

<P><BR>

<P><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

PENNSYLVANIA&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

23-2265045</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

(State or other jurisdiction of&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;

(I.R.S. Employer</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

incorporation or organization)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;

Identification No.)</FONT>

<BR>&nbsp;

<P><BR>

<CENTER>

<P><FONT SIZE=+0>15 South Main Street, Mansfield, Pennsylvania 16933</FONT>

<BR><FONT SIZE=+0>(Address of principal executive offices) (Zip Code)</FONT>

<P><FONT SIZE=+0>Registrant's telephone number, including area code: (717)662-2121</FONT>

<P><FONT SIZE=+0>Securities registered pursuant to section 12 (b) of the

Act:</FONT></CENTER>



<BR>&nbsp;

<P><BR>

<P><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Title of each class&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Name of each exchange on</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&n

which registered</FONT>

<P><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

NOT APPLICABLE&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

NOT APPLICABLE</FONT>

<BR>&nbsp;

<P><BR>

<CENTER>

<P><FONT SIZE=+0>Securities registered pursuant to section 12 (g) of the

Act:</FONT>

<P><FONT SIZE=+0>Common Stock, par value $1.00 per share.</FONT>

<P><FONT SIZE=+0>(Title of class)</FONT></CENTER>



<P><FONT SIZE=+0>Indicate by checkmark whether the registrant (1) has filed

all reports to be filed by Section 13 or 15 (d) of the SecuritiesExchange

Act of 1934 during the preceding 12 months (or for suchshorter period that

the registrant was required to file such reports), and (2) has been subject

to such filing requirements for</FONT>

<P><FONT SIZE=+0>the past 90 days. Yes__X___No_____</FONT>

<P><FONT SIZE=+0>The total market value of the voting stock of the Registrant

held by non-affiliates (for this purpose, persons or entities other than

executive officers, directors, or 5% or more stockholders) of</FONT>

<BR><FONT SIZE=+0>the Registrant, as of March 1, 2000, is estimated to

have been approximately $40,701,000.</FONT>

<P><FONT SIZE=+0>Indicate by check mark if disclosure of delinquent filers

pursuant to Item 405 or Regulation S-K is not contained herein, and will

not be contained, to the best of registrant's knowledge,</FONT>

<P><FONT SIZE=+0>in definitive proxy or information statements incorporated

by reference in Part III of this Form 10-K or any amendment to this Form

10-K. ___</FONT>

<BR>

<HR>

<P><FONT SIZE=+0>The number of shares outstanding of the Registrant's Common

Stock, as of December 31, 1999, 2,800,563 shares of Common Stock, par value

$1.00.</FONT>

<BR>&nbsp;

<CENTER>

<P><FONT SIZE=+0>DOCUMENTS INCORPORATED BY REFERENCE</FONT></CENTER>



<BR>&nbsp;

<P><BR>

<P><FONT SIZE=+0>Certain information required by Parts I, III and IV are

incorporated by reference to Registrant's Definitive Proxy Statement for

the Annual Meeting of Stockholders to be held April 18, 2000.</FONT>

<P><FONT SIZE=+0>Certain information required by Parts II and IV are incorporated

by reference to Registrant's Annual Report to Stockholders for the Year

Ended December 31, 1999.</FONT>

<BR>

<HR>

<CENTER>

<P><FONT SIZE=+0>Citizens Financial Services, Inc.</FONT>

<P><FONT SIZE=+0>Form 10-K</FONT>

<P><FONT SIZE=+0>INDEX</FONT></CENTER>



<BR>&nbsp;

<P><BR>

<P><FONT SIZE=+0>Part I&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nb

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Page</FONT>

<P><FONT SIZE=+0>Item 1-Business&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp

;

1-3</FONT>

<P><FONT SIZE=+0>Item 2-Properties&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbs

4</FONT>

<P><FONT SIZE=+0>Item 3-Legal Proceedings&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nb

5</FONT>

<P><FONT SIZE=+0>Item 4-Submission of Matters to a Vote of Stockholders&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

5</FONT>

<P><FONT SIZE=+0>Part II</FONT>

<P><FONT SIZE=+0>Item 5-Market for Registrant's Common Stock and Related</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Shareholder Matters&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&

5</FONT>

<P><FONT SIZE=+0>Item 6-Selected Financial Data&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nb

5</FONT>

<P><FONT SIZE=+0>Item 7-Management's Discussion and Analysis of Financial</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Condition and Results of Operations&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

5</FONT>

<P><FONT SIZE=+0>Item 7A-Quantitative and Qualitative Disclosure</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

About Market Risk&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nb

5</FONT>

<P><FONT SIZE=+0>Item 8-Financial Statements and Supplementary Data&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

6</FONT>

<P><FONT SIZE=+0>Item 9-Changes in and Disagreements with Accountants on</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Accounting and Financial Disclosure&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

6</FONT>

<P><FONT SIZE=+0>Part III</FONT>

<P><FONT SIZE=+0>Item 10-Directors and Executive Officers of the Registrant&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

6</FONT>

<P><FONT SIZE=+0>Item 11-Executive Compensation&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nb

6</FONT>

<P><FONT SIZE=+0>Item 12-Security Ownership of Certain Beneficial Owners

and</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Management&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbs

<P><FONT SIZE=+0>Item 13-Certain Relationships and Related Transactions&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

6</FONT>

<P><FONT SIZE=+0>Part IV</FONT>

<P><FONT SIZE=+0>Item 14-Exhibits, Financial Statement Schedules, and Reports

on</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Form 8-K&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;

7-8</FONT>

<P><FONT SIZE=+0>Signatures&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp

9</FONT>

<BR>

<HR>

<BR><FONT SIZE=-1>[Page 1]</FONT>

<P><FONT SIZE=+0>Part I</FONT>

<P><FONT SIZE=+0>Item 1-Business</FONT>

<P><FONT SIZE=+0>Citizens Financial Services, Inc. (the "company") is a

Pennsylvania business corporation, incorporated April 30, 1984 to form

a bank holding company. On April 30, 1984, First Citizens National Bank

(the "First Citizens") became a wholly owned subsidiary of our company

by means of a merger in which the stockholders of First Citizens became

stockholders of our company.</FONT>

<P><FONT SIZE=+0>In 1932, First National Bank opened for business in Mansfield,

Pennsylvania. In 1970 the First National Bank in Mansfield merged with

Citizens National Bank of Blossburg, Pennsylvania to form First Citizens

National Bank. In 1971, the Bank expanded into Potter County through the

acquisition of the Grange National Bank, which had offices in Ulysses and

Genesee, Pennsylvania.</FONT>

<P><FONT SIZE=+0>On November 16, 1990, we acquired Star Savings and Loan

Association (the "Association"), originally organized as a Pennsylvania-chartered

mutual savings and loan association in 1899 and converted to a Pennsylvania-chartered

permanent reserve fund stock savings and loan association on March 27,

1986. On December 31, 1991, the Association merged with First Citizens

terminating the Association's separate operations as a savings and loan.</FONT>

<P><FONT SIZE=+0>On April 20, 1996 First Citizens purchased two branch

offices of Meridian Bank in Canton and Gillett, Pennsylvania.</FONT>

<P><FONT SIZE=+0>Next, we opened a branch office in the new Weis supermarket

in Wellsboro, Pennsylvania on October 31, 1996.</FONT>

<P><FONT SIZE=+0>As of December 31, 1999, First Citizens employed 134 full

time equivalent employees at our ten banking facilities.</FONT>

<P><FONT SIZE=+0>Our company's profitability does not depend upon a few

customers, losing the business of any one customer or group of customers

would not cause a material impact on our business.</FONT>

<P><FONT SIZE=+0>We are dependent geographically upon the economic conditions

in north central Pennsylvania and western New York. Additional information

related to our business and the competition is detailed in the Management's

Discussion and Analysis of the 1999 Annual Report to the Stockholders,

which information is included at Exhibit 13, hereof and incorporated herein

by reference.</FONT>

<BR>&nbsp;

<P><FONT SIZE=+0>REGULATION AND SUPERVISION</FONT>

<P><FONT SIZE=+0>Our company's operations and those of First Citizens are

regulated by several federal and state entities, including the Federal

Reserve System, the Federal Deposit Insurance Corporation ("FDIC") and

the Office of the Comptroller of the Currency ("Comptroller").</FONT>

<P><FONT SIZE=+0>The Comptroller is the primary supervisory authority over

First Citizens. The Comptroller regularly examines our bank and has the

authority, under the Financial Institutions Supervisory Act, to prevent

us from engaging in unsafe or unsound practices in the conduct of our business.</FONT>

<P><FONT SIZE=+0>Our company is subject to regulation under the Bank Holding

Company Act of 1956, as amended (the "Act"). The Act generally does not

permit bank holding companies:</FONT>

<BR>&nbsp;

<BLOCKQUOTE><FONT SIZE=+0>To acquire direct or indirect ownership of any

company which is not a bank;</FONT></BLOCKQUOTE>



<BLOCKQUOTE><FONT SIZE=+0>To acquire control of more than 5% of the voting

shares of any company which is not a bank; or</FONT></BLOCKQUOTE>



<BLOCKQUOTE><FONT SIZE=+0>To engage in any business other than that of:</FONT></BLOCKQUOTE>



<HR>

<BR><FONT SIZE=-1>[Page 2]</FONT>

<BR>&nbsp;

<BLOCKQUOTE><FONT SIZE=+0>Banking;</FONT>

<P><FONT SIZE=+0>Managing and controlling banks;</FONT>

<P><FONT SIZE=+0>Furnishing services to subsidiary banks; or</FONT>

<P><FONT SIZE=+0>Engaging in any other activity which the Federal Reserve

deems to be closely related to banking.</FONT></BLOCKQUOTE>

<FONT SIZE=+0></FONT>

<P><BR><FONT SIZE=+0>The Act also prohibits our company from engaging in

"tie-in" arrangements with our customers in which we would extend credit

to a customer, and in exchange, the customer would perform services for

First Citizens.</FONT>

<P><FONT SIZE=+0>The Act requires our company to obtain the approval of

the Federal Reserve before we acquire more that 5% of the voting stock

of another bank. The Act also requires us to file annual reports with the

Federal Reserve. The Act also permits the Federal Reserve to examine the

operations of our company.</FONT>

<P><FONT SIZE=+0>The Act requires prior approval by the Federal Reserve

of the acquisition by our company of more than 5% of the voting stock of

any additional bank. Our company is required by the Act to file annual

reports of our operations with the Federal Reserve and of any additional

information that the Federal Reserve may require. The Federal Reserve may

also make examinations of our company and any or all of our subsidiaries.

Further, under Section 106 of the 1970 amendments to the Act and the Federal

Reserve's regulations, a bank holding company and our subsidiaries are

prohibited from engaging in certain tie-in arrangements in connection with

any extension of credit or provision of credit or provision of any property

or service.</FONT>

<P><FONT SIZE=+0>Subsidiary banks of a bank holding company are subject

to certain restrictions imposed by the Federal Reserve Act on any extensions

of credit to our bank holding company or any of our subsidiaries, or investments

in the stock or other securities of our bank holding company and on taking

of such stock or securities as collateral for loans to any borrower.</FONT>

<BR>&nbsp;

<P><FONT SIZE=+0>PERMITTED NON-BANKING ACTIVITIES</FONT>

<P><FONT SIZE=+0>The Federal Reserve permits our bank holding companies

to engage in non-banking activities which are closely related to banking

or managing or controlling banks. Our company presently does not engage

in any such activities nor does it intend to in the near future.</FONT>

<P><FONT SIZE=+0>Neither our company nor our subsidiary anticipates that

compliance with environmental laws and regulations will have any material

effect on capital expenditures, earnings, or on our competitive position.</FONT>

<P><FONT SIZE=+0>Our company is a legal entity, separate and distinct from

First Citizens. Most of our company's revenues, including funds available

for payment of dividends and for operating expenses, are provided by dividends

from First Citizens. Certain limitations exist on the availability of First

Citizens's undistributed net assets for the payment of dividends to our

parent without prior approval of First Citizens regulatory authorities

as further described in Footnote 14 of the 1999 Annual Report to the stockholders,

which information is included at Exhibit 13, hereof and incorporated herein

by reference.</FONT>

<BR>&nbsp;

<P><FONT SIZE=+0>LEGISLATION AND REGULATORY CHANGES</FONT>

<P><FONT SIZE=+0>From time to time, various types of federal and state

legislation have been proposed that could result in additional regulation

of and restrictions on the business of our company and First Citizens.

We cannot predict whether such legislation will be adopted or, if adopted,

how such legislation would affect the business of our company or First

Citizens. As a consequence of the extensive regulation of commercial banking

activities in the United States, the company's and Bank's business is particularly

susceptible to being affected by new and revised federal legislation and

regulations that may increase the cost of doing business.</FONT>

<BR>

<HR>

<BR><FONT SIZE=-1>[Page 3]</FONT>

<P><FONT SIZE=+0>Risk-Based Capital Guidelines. The Federal Reserve, the

FDIC and the Comptroller have issued certain risk-based capital guidelines,

which supplement existing capital requirements and have been discussed

in Footnote 14 of the 1999 Annual Report to the stockholders, which information

is included at Exhibit 13, hereof and incorporated herein by reference.</FONT>

<P><FONT SIZE=+0>We are not aware of any other current specific recommendations

by regulatory authorities or proposed legislation, which if it were adopted,

would have a material adverse effect upon our company's liquidity, capital

resources, or results of operations, although the general cost of compliance

with numerous federal and state laws and regulations does have, and in

the future may have, a negative impact on our company's results of operations.</FONT>

<P><FONT SIZE=+0>The state of the financial services industry effects the

business of our company is also. As a result of legal and industry changes,

we believe that the industry will continue to experience an increase in

consolidations and mergers as the financial services industry strives for

greater cost efficiencies and market share. We believe that such consolidations

and mergers may enhance our competitive position as a community bank by

creating the customer perception of poor service at large institutions.</FONT>

<BR>&nbsp;

<P><FONT SIZE=+0>EFFECT OF GOVERNMENT MONETARY POLICIES</FONT>

<P><FONT SIZE=+0>The monetary and fiscal policies of the United States

government and agencies greatly affect domestic economic conditions and

the economic conditions in the United States affect the earnings of our

company.</FONT>

<P><FONT SIZE=+0>The monetary policies of the Federal Reserve Board have

had and will likely continue to have, an important impact on the operating

results of commercial banks through our power to implement national monetary

policy in order, among other things, to curb inflation or combat a recession.

The Federal Reserve Board has a major effect upon the levels of bank loans,

investments and deposits through our open market operations in United States

securities and through our regulation of, among other things, the discount

rate on borrowings of member banks and the reserve requirements against

member bank deposits. It is not possible to predict the nature and impact

of future changes in monetary and fiscal policies (also see page 53 of

Management's Discussion and Analysis of the 1999 Annual Report to the Stockholders,

which information is included at Exhibit 13, hereof and incorporated herein

by reference).</FONT>

<BR>

<HR>

<BR><FONT SIZE=-1>[Page 4]</FONT>

<P><FONT SIZE=+0>Item 2-Properties</FONT>

<P><FONT SIZE=+0>The headquarters of our company is located in Mansfield,

Pennsylvania. The building contains the central offices of the company

and First Citizens. Our Bank also owns eight other banking facilities.

All buildings are owned by First Citizens and are free of any liens or

encumbrances.</FONT>

<P><FONT SIZE=+0>PROPERTIES&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Current Building</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&n

Construction Date</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&n

(Renovation Date)</FONT>

<P><FONT SIZE=+0>Main office:</FONT>

<BR><FONT SIZE=+0>&nbsp; 15 South Main St.</FONT>

<BR><FONT SIZE=+0>&nbsp; Mansfield, PA 16933&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

1971</FONT>

<P><FONT SIZE=+0>Branch offices:</FONT>

<BR><FONT SIZE=+0>&nbsp; 320 Main St.</FONT>

<BR><FONT SIZE=+0>&nbsp; Blossburg, PA 16912&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

1988</FONT>

<P><FONT SIZE=+0>&nbsp; 502 Main St.</FONT>

<BR><FONT SIZE=+0>&nbsp; Ulysses, PA 16948&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

1977</FONT>

<P><FONT SIZE=+0>&nbsp; Main St.</FONT>

<BR><FONT SIZE=+0>&nbsp; Genesee, PA 16923&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

1985</FONT>

<P><FONT SIZE=+0>&nbsp; 306 West Lockhart St.</FONT>

<BR><FONT SIZE=+0>&nbsp; Sayre, PA 18840&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

1989</FONT>

<P><FONT SIZE=+0>&nbsp; 99 Main St.</FONT>

<BR><FONT SIZE=+0>&nbsp; Wellsboro, PA 16901&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

1979</FONT>

<P><FONT SIZE=+0>&nbsp; 103 West Main St.</FONT>

<BR><FONT SIZE=+0>&nbsp; Troy, PA 16947&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp

1988</FONT>

<P><FONT SIZE=+0>&nbsp; 29 West Main</FONT>

<BR><FONT SIZE=+0>&nbsp; Canton, PA 17724&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

1974 (1997)</FONT>

<P><FONT SIZE=+0>&nbsp; Main St.</FONT>

<BR><FONT SIZE=+0>&nbsp; Gillett, PA 16925&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&n

1970 (1997)</FONT>

<P><FONT SIZE=+0>Operations Center</FONT>

<BR><FONT SIZE=+0>&nbsp; 1163 South Main St.</FONT>

<BR><FONT SIZE=+0>&nbsp; Mansfield PA 16933&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

1999</FONT>

<P><FONT SIZE=+0>The net book value for these properties, as of December

31, 1999 was $5,942,000. The properties are adequate to meet the needs

of the employees and customers. We discuss future expansion plans for the

Mansfield office and operations center in Management's Discussion and Analysis

on pages 51 of the 1999 Annual Report to the Stockholders, which information

is included at Exhibit 13, hereof and incorporated herein by reference.

We have equipped all of our facilities with current technological improvements

for data and word processing.</FONT>

<P><FONT SIZE=+0>Inflation has an impact on our company's operating costs,

however, unlike many industrial companies, substantially all of our company's

assets and liabilities are monetary in nature. As a result, interest rates

have a more significant impact on our company's performance than the general

level of inflation. Over short periods of time, interest rates may not

necessarily move in the same direction or in the same magnitude as prices

of goods and services.</FONT>

<BR>

<HR>

<BR><FONT SIZE=-1>[Page 5]</FONT>

<P><FONT SIZE=+0>Item 3-Legal Proceedings</FONT>

<P><FONT SIZE=+0>We are not aware of any litigation that would have a material

adverse effect on the consolidated financial position of our company. We

know of no proceedings pending other than ordinary, routine litigation

incidental to the business of the company and our subsidiary. In addition,

we know of no material proceedings that are pending or are known to be

threatened or contemplated against our company and our bank subsidiary

by government authorities.</FONT>

<P><FONT SIZE=+0>Item 4-Submission of Matters to a Vote of Stockholders</FONT>

<P><FONT SIZE=+0>We submitted no matters to a vote of security holders

in the fourth quarter of 1999.</FONT>

<P><FONT SIZE=+0>Part II</FONT>

<P><FONT SIZE=+0>Item 5-Market for the Registrant's Common Stock and Related</FONT>

<P><FONT SIZE=+0>Shareholder Matters</FONT>

<P><FONT SIZE=+0>Our company's stock is not listed on any stock exchange,

but it is listed on the National Association of Securities Dealers OTC

Bulletin Board electronic system under the trading symbol CZFS.</FONT>

<P><FONT SIZE=+0>You can find our market and dividend information on pages

20, 36, and 56 of our company's 1999 Annual Report to the Stockholders

which are included in Exhibit 13 hereto.</FONT>

<P><FONT SIZE=+0>Our company has paid dividends since April 30, 1984, the

effective date of our formation as a bank holding company. Our company's

Board of Directors intends to continue the dividend payment policy; however,

future dividends necessarily depend upon earnings, financial condition,

appropriate legal restrictions and other factors as in existence at the

time the Board of Directors considers dividend policy. Cash available for

dividend distributions to stockholders of our company comes from dividends

paid to our company by First Citizens. Therefore, restrictions on the ability

of First Citizens to make dividend payments are directly applicable to

our company.</FONT>

<P><FONT SIZE=+0>Under the Pennsylvania Business Corporation Law of 1988,

our company may pay dividends only if, after payment, our company would

be able to pay our debts as they become due in the usual course of our

business and our total assets will be greater than the sum of our total

liabilities.</FONT>

<P><FONT SIZE=+0>As of February 18, 2000 our company had approximately

1,484 stockholders of record.</FONT>

<P><FONT SIZE=+0>Item 6-Selected Financial Data</FONT>

<P><FONT SIZE=+0>You can find the discussion required by this item on page

36 of the 1999 Annual Report to the Stockholders, which information is

included at Exhibit 13, hereof and incorporated herein by reference.</FONT>

<P><FONT SIZE=+0>Item 7-Management's Discussion and Analysis of Financial</FONT>

<P><FONT SIZE=+0>Condition and Results of Operations</FONT>

<P><FONT SIZE=+0>You can find information required by this item on pages

38 - 53 of the 1999 Annual Report to the Stockholders, which information

is included at Exhibit 13, hereof and incorporated herein by reference.</FONT>

<P><FONT SIZE=+0>Item 7A-Quantitative and Qualitative Disclosures About

Market Rate Risk</FONT>

<P><FONT SIZE=+0>You can find information required by this item 7A on pages

51 - 53 of the 1999 Annual Report to the Stockholders, which information

is included at Exhibit 13, hereof and incorporated herein by reference.</FONT>

<BR>

<HR>

<BR><FONT SIZE=-1>[Page 6]</FONT>

<P><FONT SIZE=+0>Item 8-Financial Statements and Supplementary Data</FONT>

<P><FONT SIZE=+0>You can find information required by this item on pages

13 - 34 and 36 of the 1999 Annual Report to the Stockholders, which information

is included at Exhibit 13, hereof and incorporated herein by reference.</FONT>

<P><FONT SIZE=+0>Financial Statements:</FONT>

<BLOCKQUOTE><FONT SIZE=+0>Consolidated Balance Sheet as of December 31,

1999 and 1998</FONT>

<BR><FONT SIZE=+0>Consolidated Statement of Income for the Years Ended&nbsp;

December 31, 1999, 1998 and 1997</FONT>

<BR><FONT SIZE=+0>Consolidated Statement of Changes in Stockholders' Equity&nbsp;

for the Years Ended December 31, 1999, 1998 and 1997</FONT>

<BR><FONT SIZE=+0>Consolidated Statement of Cash Flows for the Years Ended

December 31, 1999, 1998 and 1997</FONT>

<BR><FONT SIZE=+0>Notes to Consolidated Financial Statements</FONT>

<BR><FONT SIZE=+0>Report of Independent Certified Public Accountants</FONT></BLOCKQUOTE>

<FONT SIZE=+0>Item 9-Changes in and Disagreements with Accountants on</FONT>

<P><FONT SIZE=+0>Accounting and Financial Disclosure</FONT>

<P><FONT SIZE=+0>None</FONT>

<P><FONT SIZE=+0>Part III</FONT>

<P><FONT SIZE=+0>Item 10-Directors and Executive Officers of the Registrant</FONT>

<P><FONT SIZE=+0>You can find this information appearing in our Proxy Statement

under the caption "Board of Directors and Executive Officers" to the Annual

Meeting of Stockholders to be held April 18, 2000, those sections of our

proxy statement are incorporated by reference in response to this item.</FONT>

<P><FONT SIZE=+0>Item 11-Executive Compensation</FONT>

<P><FONT SIZE=+0>You can find information appearing in our Proxy Statement

under the caption "Executive Compensation", that section of our proxy statement

is incorporated by reference in response to this item.</FONT>

<P><FONT SIZE=+0>Item 12-Security Ownership of Certain Beneficial Owners

and</FONT>

<P><FONT SIZE=+0>Management</FONT>

<P><FONT SIZE=+0>You can find this information appearing in our Proxy Statement

under the caption "Beneficial Ownership of the Corporation's Stock Owned

by Principal Owners and Management". That section of our proxy statement

is related to the Annual Meeting of Stockholders to be held April 18, 2000,

is incorporated by reference in response to this item.</FONT>

<P><FONT SIZE=+0>Item 13-Certain Relationships and Related Transactions</FONT>

<P><FONT SIZE=+0>You can find this in our Proxy Statement under the caption

"Certain Relationships and Related Transactions" that is incorporated by

reference in response to this item.</FONT>

<BR>

<HR>

<BR><FONT SIZE=-1>[Page 7]</FONT>

<P><FONT SIZE=+0>Part IV</FONT>

<P><FONT SIZE=+0>Item 14-Exhibits, Financial Statement Schedules and Reports

on Form 8-K.</FONT>

<P><FONT SIZE=+0>a(1)-Financial Statements. The following consolidated

financial statements of Citizens Financial Services, Inc. and subsidiary

are incorporated by reference to the 1999 Annual Report:</FONT>

<BLOCKQUOTE><FONT SIZE=+0>Consolidated Balance Sheet as of December 31,

1999 and 1998</FONT>

<BR><FONT SIZE=+0>Consolidated Statement of Income for the Years Ended

December 31, 1999, 1998 and 1997</FONT>

<BR><FONT SIZE=+0>Consolidated Statement of Changes in Stockholders' Equity

for the Years Ended December 31, 1999, 1998 and 1997</FONT>

<BR><FONT SIZE=+0>Consolidated Statement of Cash Flows for the Years Ended

December 31, 1999, 1998 and 1997</FONT>

<BR><FONT SIZE=+0>Notes to Consolidated Financial Statements</FONT>

<P><FONT SIZE=+0>Report of Independent Certified Public Accountants</FONT></BLOCKQUOTE>



<P><BR><FONT SIZE=+0>(2)-Financial Statement Schedules. Financial Statement

Schedules are omitted because the required information is either not applicable,

not required or is shown in the respective financial statement or in the

notes thereto.</FONT>

<P><FONT SIZE=+0>(3)-Exhibits: The following Exhibits are filed herewith,

or incorporated by reference as a part of this report.</FONT>

<DIR>

<DIR>

<DIR><FONT SIZE=+0>(3)(i) - Articles of Incorporation of the Corporation,

as amended. (Incorporated by Reference to Exhibit (3)(i) to the Annual

Report of Form 10-K for the fiscal year ended December 31, 1998, as filed

with the Commission on March 17, 1999.)</FONT>

<P><FONT SIZE=+0>(3)(ii)- By-laws of the Corporation, as amended. (Incorporated

by Reference to Exhibit (3)(ii) to the Annual Report of Form 10-K for the

fiscal year ended December 31, 1995, as filed with the Commission on March

26, 1996.)</FONT></DIR>

</DIR>

</DIR>



<DIR>

<DIR>

<DIR><FONT SIZE=+0>(4) - Instruments Defining the Rights of Stockholders.

(Incorporated by reference to the Registrant's Registration Statement No.2-89103

on Form S-14, as filed with the Commission on February 17, 1984.)</FONT>

<P><FONT SIZE=+0>(10) - Material Contracts. Employment Agreement between

our company and Richard E. Wilber. (Incorporated by Reference to Exhibit

(10)to the Annual Report of Form 10-K for the fiscal year ended December

31, 1998, as filed with the Commission on March 17, 1998.)</FONT>

<P><FONT SIZE=+0>(11) - Computation of Earnings Per Share included on page

20 of the 1999 Annual Report to Stockholders.</FONT>

<P><FONT SIZE=+0>(13) - Annual Report to Stockholders for the year ended

December 31, 1999.</FONT></DIR>

</DIR>

</DIR>

<FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

(21) - Subsidiaries of Citizens Financial Services, Inc.</FONT>

<DIR>

<DIR>

<DIR><FONT SIZE=+0>(27) - Financial Data Schedule, which are submitted

electronically to the Securities and Exchange Commission for information

only and not filed.</FONT>

<BR>

<HR>

<BR><FONT SIZE=-1>[Page 8]</FONT></DIR>

</DIR>

</DIR>

<FONT SIZE=+0>(b) Reports on Form 8-K.</FONT>

<P><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp; No current report on Form 8-K

was filed by the Registrant during the fourth quarter of the 1999 fiscal

year.</FONT>

<P><FONT SIZE=+0>(c) The exhibits required to be filed by this item are

listed under Item 14(a)(3) above.</FONT>

<P><FONT SIZE=+0>(d) Not applicable.</FONT>

<BR>

<HR>

<BR>&nbsp;

<P><BR>

<CENTER>

<P><FONT SIZE=+0>SIGNATURES</FONT></CENTER>



<BR>&nbsp;

<P><BR>

<P><FONT SIZE=+0>Pursuant to the requirements of Section 13 or 15 (d) of

the Securities Exchange Act of 1934, the Registrant has duly caused this

report to be signed on our behalf by the undersigned, there unto duly authorized.</FONT>

<P><FONT SIZE=+0>Citizens Financial Services, Inc.</FONT>

<P><FONT SIZE=+0>(Registrant)</FONT>

<P><FONT SIZE=+0>/s/ Richard E. Wilber&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

/s/ Thomas C. Lyman</FONT>

<BR><FONT SIZE=+0>By: Richard E. Wilber&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

By: Thomas C. Lyman</FONT>

<BR><FONT SIZE=+0>President, Chief Executive Officer&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Treasurer</FONT>

<BR><FONT SIZE=+0>(Principal Executive Officer)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

(Principal Financial &amp;</FONT>

<BR><FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&n

Accounting Officer)</FONT>

<P><FONT SIZE=+0>Date: March 7, 2000&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Date:&nbsp; March 7, 2000</FONT>

<P><FONT SIZE=+0>Pursuant to the requirements of the Securities Exchange

Act of 1934, this report has been signed below by the following persons

on behalf of the Registrant and in the capacities and on the dates indicated.</FONT>

<P><FONT SIZE=+0>Signature and Capacity&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Date</FONT>

<P><FONT SIZE=+0>/s/ Richard E. Wilber&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

March 7, 2000</FONT>

<BR><FONT SIZE=+0>Richard E. Wilber, President, Chief Executive Officer,

Director (Principal Executive Officer)</FONT>

<P><FONT SIZE=+0>/s/ Carol J. Tama&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

March 7, 2000</FONT>

<BR><FONT SIZE=+0>Carol J. Tama, Director</FONT>

<P><FONT SIZE=+0>/s/ R. Lowell Coolidge&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

March 7, 2000</FONT>

<BR><FONT SIZE=+0>R. Lowell Coolidge, Director</FONT>

<P><FONT SIZE=+0>/s/ Rudolph J. van der Hiel&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

March 7, 2000</FONT>

<BR><FONT SIZE=+0>Rudolph J. van der Hiel, Director</FONT>

<BR>&nbsp;

<P><FONT SIZE=+0>John E. Novak, Director</FONT>

<P><FONT SIZE=+0>/s/ Bruce L. Adams&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

March 7, 2000</FONT>

<BR><FONT SIZE=+0>Bruce L. Adams, Director</FONT>

<P><FONT SIZE=+0>/s/ William D. VanEttan&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

March 7, 2000</FONT>

<BR><FONT SIZE=+0>William D. VanEttan, Director</FONT>

<P><FONT SIZE=+0>/s/ Larry J. Croft&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

March 7, 2000</FONT>

<BR><FONT SIZE=+0>Larry J. Croft, Director</FONT>

<BR>&nbsp;

<P><FONT SIZE=+0>John M. Thomas, MD, Director</FONT>

<P><FONT SIZE=+0>/s/ Mark L. Dalton&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

March 7, 2000</FONT>

<BR><FONT SIZE=+0>Mark L. Dalton, Director</FONT>

<P><FONT SIZE=+0>/s/ Thomas C. Lyman&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

March 7, 2000</FONT>

<BR><FONT SIZE=+0>Thomas C. Lyman, Treasurer</FONT>

<BR><FONT SIZE=+0>(Principal Financial and Accounting Officer)</FONT>

<BR>

<HR>

<BR><FONT SIZE=-1>[Page 10]</FONT>

<BR>&nbsp;

<P><FONT SIZE=+0>EXHIBITS INDEX</FONT>

<DIR>

<DIR>

<DIR><FONT SIZE=+0>(3)(i) - Articles of Incorporation of the Corporation,

as amended. (Incorporated by Reference to Exhibit (3)(i) to the Annual

Report of Form 10-K for the fiscal year ended December 31, 1998, as filed

with the Commission on March 17, 1999.)</FONT>

<P><FONT SIZE=+0>(3)(ii)- By-laws of the Corporation, as amended. (Incorporated

by Reference to Exhibit (3)(ii) to the Annual Report of Form 10-K for the

fiscal year ended December 31, 1995, as filed with the Commission on March

26, 1996.)</FONT></DIR>

</DIR>

</DIR>



<DIR>

<DIR>

<DIR><FONT SIZE=+0>(4) - Instruments Defining the Rights of Stockholders.

(Incorporated by reference to the Registrant's Registration Statement No.2-89103

on Form S-14, as filed with the Commission on February 17, 1984.)</FONT>

<P><FONT SIZE=+0>(10) - Material Contracts. Employment Agreement between

our company and Richard E. Wilber. (Incorporated by Reference to Exhibit

(10)to the Annual Report of Form 10-K for the fiscal year ended December

31, 1998, as filed with the Commission on March 17, 1998.)</FONT>

<P><FONT SIZE=+0>(11) - Computation of Earnings Per Share included on page

20 of the 1999 Annual Report to Stockholders</FONT>

<P><FONT SIZE=+0>(13)- Annual Report to Stockholders for the year ended

December 31, 1999.</FONT></DIR>

</DIR>

</DIR>

<FONT SIZE=+0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

(21) - Subsidiaries of Citizens Financial Services, Inc.</FONT>

<DIR>

<DIR>

<DIR><FONT SIZE=+0>(27) - Financial Data Schedule, which are submitted

electronically to the Securities and Exchange Commission for information

only and not filed.</FONT></DIR>

</DIR>

</DIR>



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