10-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

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

For the fiscal year ended December 31, 2008

OR

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

For the transition period from                      to                     

Commission file number: 1-13006

Park National Corporation

(Exact name of Registrant as specified in its charter)

Ohio	31-1179518
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
50 North Third Street, P.O. Box 3500, Newark, Ohio	43058-3500
(Address of principal executive offices)	(Zip Code)

(740) 349-8451
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Shares, without par value	NYSE Alternext US LLC

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
þ Yes o No

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
o Yes þ No

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. þ Yes o No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, 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. o

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer þ	Accelerated filer o	Non-accelerated filer o	Smaller reporting company o
		(Do not check if a smaller reporting company)

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). o Yes þ No

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the Registrant’s most recently completed second fiscal quarter: As of June 30, 2008, the aggregate market value of the Registrant’s common shares (the only common equity of the Registrant) held by non-affiliates of the Registrant was $692,896,466 based on the closing sale price as reported on American Stock Exchange LLC (predecessor to NYSE Alternext US LLC). For this purpose, executive officers and directors of the Registrant are considered affiliates.

Indicate the number of shares outstanding of each of the Registrant’s classes of common stock, as of the latest practicable date.

Class	Outstanding at February 13, 2009
Common Shares, without par value	13,971,719 common shares

DOCUMENTS INCORPORATED BY REFERENCE

Document	Parts Into Which Incorporated
Portions of the Registrant’s 2008 Annual Report	Parts I and II
Portions of the Registrant’s Definitive Proxy Statement for the Annual Meeting of Shareholders to be held on April 20, 2009	Part III

Exhibit Index on Page 63

PART I

ITEM 1. BUSINESS.

General

Park National Corporation (“Park”) is a bank holding company registered under the Bank Holding Company Act of 1956, as amended (the “Bank Holding Company Act”). Although Park was a financial holding company effective in December 2007, Park ceased to be a financial holding company effective June 30, 2008 and neither Park nor any of its subsidiaries engages in any of the activities permitted for a financial holding company but not a bank holding company.

Park was incorporated under Ohio law in 1992. Park’s principal executive offices are located at 50 North Third Street, Newark, Ohio 43055, and its telephone number is (740) 349-8451. Park’s common shares, each without par value (“Common Shares”), are listed on NYSE Alternext US LLC, successor to American Stock Exchange LLC (“NYSE Alternext”), under the symbol “PRK.”

Park maintains an Internet website at www.parknationalcorp.com (this uniform resource locator, or URL, is an inactive textual reference only and is not intended to incorporate Park’s Internet website into this Annual Report on Form 10-K). Park makes available free of charge on or through its Internet website, Park’s annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as well as Park’s definitive proxy statements filed pursuant to Section 14 of the Exchange Act, as soon as reasonably practicable after Park electronically files such material with, or furnishes it to, the Securities and Exchange Commission (the “SEC”).

Park’s principal business consists of owning and supervising its subsidiaries. Although Park directs the overall policies of its subsidiaries, including lending policies and financial resources, most day-to-day affairs are managed by its subsidiaries’ respective officers.

Subsidiary Banks

Through Park’s subsidiary banks:

• The Park National Bank (“Park National Bank”), a national banking association with its main office in Newark, Ohio and financial service offices in Ashland, Athens, Butler, Champaign, Clark, Clermont, Coshocton, Crawford, Darke, Fairfield, Fayette, Franklin, Greene, Hamilton, Hocking, Holmes, Knox, Licking, Madison, Marion, Mercer, Miami, Montgomery, Morrow, Muskingum, Perry, Richland, Tuscarawas and Warren Counties in Ohio and Boone County in Kentucky; and

• Vision Bank (“Vision Bank”), a Florida state-chartered bank with its main office in Panama City, Florida and financial service offices in Baldwin County, Alabama and in Bay, Gulf, Leon, Okaloosa, Santa Rosa and Walton Counties in the panhandle of Florida,

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Park engages in the commercial banking and trust business. This commercial banking and trust business is primarily conducted in small and medium population Ohio communities and, since Vision Bancshares, Inc. (“Vision”) merged with and into Park in March 2007 (the “Vision Merger”), in Gulf Coast communities in Alabama and the Florida panhandle.

Vision Bank operates 18 financial service offices and one messenger office in Gulf Coast communities in Baldwin County, Alabama and the Florida panhandle. Vision Bank operates through two banking divisions — Vision Bank headquartered in Panama City, Florida and the Vision Bank Division of Gulf Shores, Alabama.

Park National Bank operates 128 financial service offices in Ohio and Northern Kentucky through twelve banking divisions with: (i) the Park National Bank division headquartered in Newark, Ohio; (ii) the Fairfield National Bank division headquartered in Lancaster, Ohio; (iii) The Park National Bank of Southwest Ohio & Northern Kentucky division headquartered in Milford, Ohio; (iv) the Century National Bank division headquartered in Zanesville, Ohio; (v) the Second National Bank division headquartered in Greenville, Ohio; (vi) the Richland Bank division headquartered in Mansfield, Ohio; (vii) the United Bank division headquartered in Bucyrus, Ohio; (viii) the First-Knox National Bank division headquartered in Mount Vernon, Ohio; (ix) the Farmers Bank division (also sometimes known as the Farmers and Savings Bank division) headquartered in Loudonville, Ohio; (x) the Security National Bank division headquartered in Springfield, Ohio; (xi) the Unity National Bank division headquartered in Piqua, Ohio; and (xii) the Citizens National Bank division headquartered in Urbana, Ohio.

Park’s two subsidiary banks comprise Park’s reportable segments. Financial information about Park’s reportable segments is included in Note 23 of the Notes to Consolidated Financial Statements located on pages 69 and 70 of Park’s 2008 Annual Report. That financial information is incorporated herein by reference.

At December 31, 2008 and as of the date of this Annual Report on Form 10-K, Park’s subsidiary banks operated 146 financial service offices and a network of 168 automated teller machines. These financial service offices span (i) 29 Ohio counties — Ashland, Athens, Butler, Champaign, Clark, Clermont, Coshocton, Crawford, Darke, Fairfield, Fayette, Franklin, Greene, Hamilton, Hocking, Holmes, Knox, Licking, Madison, Marion, Mercer, Miami, Montgomery, Morrow, Muskingum, Perry, Richland, Tuscarawas and Warren; (ii) one county in Northern Kentucky — Boone; (iii) six counties in the panhandle of Florida — Bay, Gulf, Leon, Okaloosa, Santa Rosa and Walton; and (iv) one county on the Gulf Coast of Alabama — Baldwin.

Consolidated Computer Center, a division of Park National Bank, handles the data processing needs of Park’s Ohio-based banking divisions.

Consumer Finance Subsidiary

Guardian Financial Services Company (“Guardian Finance”), an Ohio consumer finance company based in Hilliard, Ohio, also operates as a separate subsidiary of Park. Guardian Finance provides consumer finance services in the central Ohio area. As of the date of this Annual Report on Form 10-K, Guardian Finance had six financial service offices spanning six counties in Ohio: Clark, Fairfield, Franklin, Licking, Montgomery and Richland. Financial information about Guardian Finance is included in the “All Other” category for purposes of the reportable segment information included in Note 23 of the Notes to Consolidated Financial Statements located on pages 69 and 70 of Park’s 2008 Annual Report. This financial information is immaterial for purposes of separate disclosure.

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Leasing Subsidiaries

Scope Leasing, Inc. (which does business as “Scope Aircraft Finance”), a subsidiary of Park National Bank, specializes in aircraft financing. The customers of Scope Aircraft Finance include small businesses and entrepreneurs intending to use the aircraft for business or pleasure. Scope Aircraft Finance serves customers throughout the United States of America (the “United States”) and Canada.

Another subsidiary of Park National Bank, Park Leasing Company (“Park Leasing”), was formed in 2001 for the purpose of participating in an automobile leasing program with a major national insurance company. However, that program was terminated during the fourth quarter of 2004 and Park Leasing is winding down its operations.

Ohio-Based Insurance Agency Subsidiary

Park National Bank has an insurance agency subsidiary, Park Insurance Group, Inc. (“Park Insurance Group”). Park Insurance Group was formed in 2002 and offers life insurance and other insurance products through licensed representatives who work for divisions of Park National Bank. However, Park Insurance Group’s results to date have not been material to the consolidated entity.

Title Agency Subsidiary

As of the date of this Annual Report on Form 10-K, Park National Bank held 80% of the ownership interest of Park Title Agency, LLC. (“Park Title Agency”). Park Title Agency is a traditional title agency serving the central Ohio area. Effective at the close of business on February 27, 2009, Park will sell 31% of the ownership interest in Park Title Agency to the other member of Park Title Agency for $200,000.

Vision Bank Networking

Vision Bank conducts permissible insurance and securities networking activities under the d/b/a “Vision Bancshares Financial Group.” In an agency capacity, Vision Bancshares Financial Group offers its customers fixed and variable annuities, life insurance, property and casualty insurance and investment products. The securities activities of Vision Bancshares Financial Group consist primarily of selling equity securities, municipal bonds, agency bonds, corporate bonds, mutual funds and variable rate annuities on a retail basis, through duly licensed and qualified employees and pursuant to a third party networking agreement. Since the consummation of the Vision Merger, the results of Vision Bancshares Financial Group have not been material to the consolidated entity.

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Vision Bancshares Trust I

In connection with the Vision Merger, Park entered into a First Supplemental Indenture, dated as of the effective time of the Vision Merger (the “First Supplemental Indenture”), with Vision and Wilmington Trust Company, a Delaware banking corporation, as Trustee. Under the terms of the First Supplemental Indenture, Park assumed all of the payment and performance obligations of Vision under the Junior Subordinated Indenture, dated as of December 5, 2005 (the “Indenture”), pursuant to which Vision issued $15.5 million of junior subordinated debentures to Vision Bancshares Trust I, a Delaware statutory trust (the “Vision Trust”). The junior subordinated debentures were issued by Vision in connection with the sale by the Vision Trust of $15.0 million of floating rate preferred securities to institutional investors on December 5, 2005.

Under the terms of the First Supplemental Indenture, Park also succeeded to and was substituted for Vision with the same effect as if Park had originally been named (i) as “Depositor” in the Amended and Restated Trust Agreement of the Vision Trust, dated as of December 5, 2005 (the “Trust Agreement”), among Vision, Wilmington Trust Company, as Property Trustee and as Delaware Trustee, and the Administrative Trustees named therein and (ii) as “Guarantor” in the Guarantee Agreement, dated as of December 5, 2005 (the “Guarantee Agreement”), between Vision and Wilmington Trust Company, as Guarantee Trustee. Through these contractual obligations, Park has fully and unconditionally guaranteed all of the Vision Trust’s obligations with respect to the floating rate preferred securities.

Both the junior subordinated debentures and the floating rate preferred securities mature on December 30, 2035 (which maturity may be shortened to a date not earlier than December 30, 2010), and carry a floating interest rate per annum, reset quarterly, equal to the sum of three-month LIBOR plus 148 basis points. Payment of interest on the junior subordinated debentures, and payment of cash distributions on the floating rate preferred securities, may be deferred at any time or from time to time for a period not to exceed twenty consecutive quarters, subject to specified conditions.

Under the terms of the Indenture and the related Guarantee Agreement, Park, as successor to Vision in accordance with the First Supplemental Indenture, is prohibited, subject to limited exceptions, from declaring or paying dividends or distributions on, or redeeming, repurchasing, acquiring or making any liquidation payments with respect to, any shares of Park’s capital stock (i) if an event of default under the Indenture has occurred and continues; (ii) if Park is in default with respect to the payment of any obligations under the Guarantee Agreement; or (iii) during any period in which the payment of interest on the junior subordinated debentures by Park (and the payment of cash distributions on the floating rate preferred securities by the Vision Trust) is being deferred.

Other Subsidiaries

Park Investments, Inc., which is a subsidiary of Park National Bank, operates as an asset management company. Its operations are not significant to the consolidated entity.

The following subsidiaries operate as capital management companies: (i) Park Capital Investments, Inc. (“Park Capital”), a subsidiary of Park; (ii) Park National Capital LLC, whose members are Park Capital and Park National Bank; (iii) First-Knox National Capital LLC, whose members are Park Capital and Park National Bank (as successor by merger to The First-Knox National Bank of Mount Vernon); (iv) Security National Capital LLC, whose members are Park Capital and Park National Bank (as successor by merger to The Security National Bank and Trust Co.); and (v) Century National Capital LLC, whose members are Park Capital and Park National Bank (as successor by merger to Century National Bank). The operations of these subsidiaries are also not significant to the consolidated entity.

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Recent Developments

Consolidation of Ohio Banking Operations

On July 30, 2007, Park announced its intent to consolidate the banking operations of its eight subsidiary banks located in Ohio under one charter — that of Park National Bank, which would remain a national bank. As discussed below, in 2008, each of (i) Century National Bank, a national bank headquartered in Zanesville, Ohio (“CNB”); (ii) Second National Bank, a national bank headquartered in Greenville, Ohio (“SNB”); (iii) The Richland Trust Company, an Ohio state-chartered bank headquartered in Mansfield, Ohio (“RTC”); (iv) United Bank, National Association, a national bank headquartered in Bucyrus, Ohio (“UB”); (v) The First-Knox National Bank of Mount Vernon, a national bank headquartered in Mount Vernon, Ohio (“FKNB”); (vi) The Security National Bank and Trust Co., a national bank headquartered in Springfield, Ohio (“SNBT”); and (vii) The Citizens National Bank of Urbana, a national bank headquartered in Urbana, Ohio (“CIT”) (collectively, the “Merging Banks”) merged with and into Park National Bank. The mergers were consummated on a serial basis in such order and with such effective times as were determined by each of the respective Merging Banks and Park National Bank to be appropriate and in the best interest of their respective operations and approved by the Office of the Comptroller of the Currency (the “OCC”). On February 20, 2008, the OCC notified Park National Bank that the OCC had approved the proposed mergers, providing the required regulatory approval.

As described below, the 12 Ohio-based community banking subsidiaries and divisions of Park’s subsidiary banks merged into the one charter and became divisions of Park National Bank. Since the mergers, each community bank division has retained its local leadership, local decision-making and unique local identity.

Effective as of the close of business on August 15, 2008, each of CNB and SNB merged with and into Park National Bank and became a division of Park National Bank. In addition, effective as of the close of business on August 29, 2008, each of RTC and UB merged with and into Park National Bank and became a division of Park National Bank. Effective as of the close of business on September 5, 2008, FKNB merged with and into Park National Bank and became a division of Park National Bank. As a result of the merger of FKNB with and into Park National Bank, Park National Bank succeeded FKNB as the transfer agent for the Park Common Shares. The transfer agent operations are conducted at the offices of FKNB (now a division of Park National Bank) in Mount Vernon, Ohio — the location where the transfer agent operations were conducted by FKNB. FKNB ceased to serve as transfer agent for the Park Common Shares as of the close of business on September 5, 2008 in conjunction with the merger, while Park National Bank became successor transfer agent of the Park Common Shares effective as of the opening of business on September 6, 2008. Finally, effective as of the close of business on September 19, 2008, each of SNBT and CIT merged with and into Park National Bank and became a division of Park National Bank. As of the close of business on September 19, 2008, the banking operations of Park’s eight subsidiary banks located in Ohio were all consolidated under Park National Bank’s charter.

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Park National Bank now has twelve divisions: (i) the Park National Bank division headquartered in Newark, Ohio; (ii) the Fairfield National Bank division headquartered in Lancaster, Ohio; (iii) The Park National Bank of Southwest Ohio & Northern Kentucky division headquartered in Milford, Ohio; (iv) the Century National Bank division headquartered in Zanesville, Ohio; (v) the Second National Bank division headquartered in Greenville, Ohio; (vi) the Richland Bank division headquartered in Mansfield, Ohio; (vii) the United Bank division headquartered in Bucyrus, Ohio; (viii) the First-Knox National Bank division headquartered in Mount Vernon, Ohio; (ix) the Farmers Bank division (also sometimes known as the Farmers and Savings Bank division) headquartered in Loudonville, Ohio; (x) the Security National Bank division headquartered in Springfield, Ohio; (xi) the Unity National Bank division headquartered in Piqua, Ohio; and (xii) the Citizens National Bank division headquartered in Urbana, Ohio.

Participation in Capital Purchase Program Enacted as part of Troubled Assets Relief Program

On December 23, 2008, Park completed the sale to the United States Department of the Treasury (the “U.S. Treasury”) of $100.0 million of newly-issued Park non-voting preferred shares as part of the U.S. Treasury’s Capital Purchase Program (the “Capital Purchase Program”) enacted as part of the Troubled Assets Relief Program (“TARP”) under the Emergency Economic Stabilization Act of 2008 (the “EESA”). To finalize Park’s participation in the Capital Purchase Program, Park and the U.S. Treasury entered into a Letter Agreement, dated December 23, 2008 (the “Letter Agreement”), including the related Securities Purchase Agreement — Standard Terms attached thereto (the “Securities Purchase Agreement” and together with the Letter Agreement, the “UST Agreement”). Pursuant to the UST Agreement, Park issued and sold to the U.S. Treasury (i) 100,000 of Park’s Fixed Rate Cumulative Perpetual Preferred Shares, Series A, each without par value and having a liquidation preference of $1,000 per share (the “Series A Preferred Shares”), and (ii) a warrant (the “Warrant”) to purchase 227,376 Park Common Shares, at an exercise price of $65.97 per share (subject to certain anti-dilution and other adjustments), for an aggregate purchase price of $100.0 million in cash. The Warrant has a ten-year term. All of the proceeds from the sale of the Series A Preferred Shares and the Warrant by Park to the U.S. Treasury under the Capital Purchase Program will qualify as Tier 1 capital for regulatory purposes. The issuance and sale to the U.S. Treasury of the Series A Preferred Shares and the Warrant was a private placement exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(2) thereof.

Under standardized Capital Purchase Program terms, cumulative dividends on the Series A Preferred Shares will accrue on the liquidation preference at a rate of 5% per annum from December 23, 2008 to, but excluding, February 15, 2014 and at a rate of 9% per annum from and after February 14, 2014, but will be paid only if, as and when declared by Park’s Board of Directors. The Series A Preferred Shares have no maturity date and rank senior to the Park Common Shares with respect to the payment of dividends and distributions and amounts payable upon liquidation, dissolution and winding up of Park.

The terms of the Securities Purchase Agreement provide that, subject to the approval of the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”), the Series A Preferred Shares are redeemable at the option of Park at 100% of their liquidation preference plus accrued and unpaid dividends, provided that the Series A Preferred Shares may be redeemed prior to February 15, 2012 only if (i) Park has received aggregate gross proceeds from one or more qualified equity offerings (as defined in the Securities Purchase Agreement) of not less than $25.0 million and (ii) the aggregate redemption price of the Series A Preferred Shares does not exceed the aggregate net proceeds from such qualified equity offerings.

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The American Recovery and Reinvestment Act of 2009 (the “ARRA”) passed by the United States Congress and signed by the President on February 17, 2009, provides that the U.S. Treasury, subject to consultation with the appropriate federal banking agency, must permit a TARP recipient to repay any assistance previously provided under TARP, without regard to whether the TARP recipient has replaced those funds from any other source or to any waiting period. As a result, subject to consultation with the Federal Reserve Board, the U.S. Treasury must permit Park to redeem the Series A Preferred Shares at the appropriate redemption price without regard to whether the redemption price is to be paid from proceeds of a qualified equity offering or any other source or when the redemption date occurs. If the Series A Preferred Shares were redeemed, the U.S. Treasury must liquidate the related Warrant at the current market price. The U.S. Treasury is to promulgate regulations to implement the procedures under which a TARP participant may repay any assistance received. As of the date of this Annual Report on Form 10-K, the U.S. Treasury had not yet issued such regulations.

Under the terms of the Securities Purchase Agreement, the U.S. Treasury may not transfer a portion or portions of the Warrant with respect to, and/or exercise the Warrant for more than one-half of, the 227,376 Common Shares issuable upon exercise of the Warrant, in the aggregate, until the earlier of (i) the date on which Park has received aggregate gross proceeds of not less than $100.0 million from one or more qualified equity offerings and (ii) December 31, 2009. In the event Park completes one or more qualified equity offerings on or prior to December 31, 2009 that result in Park receiving aggregate gross proceeds of not less than $100.0 million, the number of the Common Shares underlying the portion of the Warrant then held by the U.S. Treasury will be reduced by one-half of the Common Shares originally covered by the Warrant. In the Securities Purchase Agreement, the U.S. Treasury has agreed not to vote any of the Common Shares it receives upon exercise of the Warrant. Any Common Shares issued by Park upon exercise of the Warrant will be issued from Common Shares held in treasury by Park.

The Securities Purchase Agreement contains limitations on the payment of dividends on the Common Shares from and after December 23, 2008 (including with respect to the payment of cash dividends in excess of $0.94 per share, which is the amount of the last quarterly cash dividend declared by Park prior to October 14, 2008). Park may not pay dividends on Park Common Shares (other than dividends payable solely in Common Shares) if Park is in arrears on the payment of Series A Preferred Share dividends. Prior to the earlier of (i) December 23, 2011 and (ii) the date on which the Series A Preferred Shares have been redeemed in whole or the U.S. Treasury has transferred the Series A Preferred Shares to unaffiliated third parties, Park may not declare or pay any dividend or make any distribution on the Park Common Shares other than: (i) regular quarterly dividends not exceeding $0.94 per share; and (ii) dividends payable solely in Park Common Shares. In addition, unless the Series A Preferred Shares have been transferred to unaffiliated third parties or have been redeemed in whole, until December 23, 2011, the U.S. Treasury’s consent would be required for any repurchases of (i) Common Shares or other capital stock or other equity securities of any kind of Park or (ii) any trust preferred securities issued by Park or any affiliate of Park, other than (x) repurchases of the Series A Preferred Shares, (y) purchases of junior preferred shares or Common Shares in connection with the administration of any employee benefit plan in the ordinary course of business and consistent with past practice and (z) purchases under certain other limited circumstances specified in the Securities Purchase Agreement. Further, Common Shares may not be repurchased by Park if Park is in arrears on the payment of Series A Preferred Share dividends.

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In the Securities Purchase Agreement, Park adopted the U.S. Treasury’s standards for executive compensation and corporate governance for the period during which the U.S. Treasury owns any securities acquired from Park pursuant to the Securities Purchase Agreement or upon exercise of the Warrant. These standards generally apply to Park’s executive officers. The ARRA retroactively amends the executive compensation and corporate governance provisions applicable to participants in the Capital Purchase Program. The ARRA executive compensation and corporate governance standards remain in effect during the period in which any obligation arising from financial assistance provided under TARP remains outstanding, excluding any period during which the U.S. Treasury holds only warrants to purchase common stock of a TARP participant. The ARRA executive compensation standards apply to Park’s Senior Executive Officers (as defined in the ARRA) as well as other employees. Please see the discussion of the standards for executive compensation and corporate governance under the EESA and the ARRA in the section captioned “Supervision and Regulation of Park and its Subsidiaries — Capital Purchase Program” below.

Sale of Credit Card Accounts

On October 10, 2008, Park National Bank executed a Credit Card Account Purchase Agreement (the “Elan Purchase Agreement”) with U.S. Bank National Association ND, d/b/a Elan Financial Services, a national bank (“Elan”). The Elan Purchase Agreement was made as of September 30, 2008. Pursuant to the Elan Purchase Agreement, Elan purchased Park National Bank’s unsecured credit card accounts (with the exception of certain specified ineligible accounts) (the “Accounts Sold”) as they existed on September 30, 2008. The Accounts Sold included accounts from each of Park National Bank’s 12 Ohio-based banking divisions and had an outstanding principal balance of approximately $31.2 million. The Accounts Sold included the Park National Bank banking divisions’ regular credit card products, such as VISA ^® Classic cards, VISA ^® signature series cards, VISA ^® Gold cards and MasterCard ^®. The Accounts Sold did not include home-equity-based VISA ^® cards.

The purchase price for the Accounts Sold of $39.3 million was based on the principal balance of the Accounts Sold, plus a premium and minus unearned program fees. Park recognized a pre-tax gain resulting from the sale of the Accounts Sold of approximately $7.6 million in the fourth quarter of 2008.

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Services Provided by Park’s Subsidiaries

Except as noted below, each of Park’s subsidiary banks and their respective divisions provide the following principal services:

• the acceptance of deposits for demand, savings and time accounts and the servicing of those accounts;

• commercial, industrial, consumer and real estate lending, including installment loans, credit cards (which, except for home-equity-based credit cards, are offered through a third party), home equity lines of credit and commercial and auto leasing;

• trust and wealth management services;

• cash management;

• safe deposit operations;

• electronic funds transfers;

• online Internet banking with bill pay service; and

• a variety of additional banking-related services tailored to the needs of individual customers.

Vision Bank does not offer credit cards, automobile or commercial leasing services.

Park believes that the deposit mix of its subsidiary banks is such that no material portion has been obtained from a single customer and, consequently, the loss of any one customer of any subsidiary bank would not have a materially adverse effect on the business of that subsidiary bank or Park.

Guardian Finance also provides consumer finance services.

Lending Activities

Park’s subsidiary banks deal with consumers as well as with a wide cross-section of businesses and corporations located primarily in (i) the 29 Ohio counties and one Kentucky county served by the financial service offices of Park National Bank and (ii) the six Florida counties and one Alabama county serviced by the financial services offices of Vision Bank. Relatively few loans are made to borrowers outside these counties. Each subsidiary bank makes lending decisions in accordance with the written loan policy adopted by Park which is designed to maintain loan quality. Each subsidiary bank originates and retains for its own portfolio commercial and commercial real estate loans, variable rate residential real estate loans, home equity lines of credit, installment loans and credit card loans. Each subsidiary bank also generates fixed rate residential real estate loans for sale to the secondary market.

Guardian Finance originates and retains for its own portfolio consumer installment loans. Guardian Finance makes lending decisions in accordance with the written loan policy adopted and approved by the Guardian Finance Board of Directors.

There are certain risks inherent in making loans. These risks include interest rate changes over the time period in which the loans may be repaid, risks resulting from changes in the national and local economies, risks inherent in dealing with borrowers and, in the case of loans secured by collateral, risks resulting from uncertainties about the future value of the collateral.

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Commercial Loans

At December 31, 2008, Park’s subsidiaries (including Scope Aircraft Finance) had approximately $1,754 million in commercial loans (including commercial real estate loans) and commercial leases outstanding, representing approximately 39% of their total aggregate loan portfolio as of that date. Of this amount, approximately $714 million represented commercial loans, $1,036 million represented commercial real estate loans and $4 million represented commercial leases. Vision Bank had approximately $196 million in commercial loans (including commercial real estate loans) outstanding at December 31, 2008, representing approximately 28% of Vision Bank’s aggregate loan portfolio at that date. Of this amount, approximately $81 million represented commercial loans and approximately $115 million represented commercial real estate loans.

Commercial loans are made for a wide variety of general corporate purposes, including financing for industrial and commercial properties, financing for equipment, inventories and accounts receivable, acquisition financing and commercial leasing. The term of each commercial loan varies by its purpose. Repayment terms are structured such that commercial loans will be repaid within the economic useful life of the underlying asset. Information concerning the loan maturity distribution within the commercial loan portfolio is provided in Table 3 included in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on page 35, and is incorporated herein by reference.

The commercial loan portfolio includes loans to a wide variety of corporations and businesses across many industrial classifications in (i) the 29 Ohio counties and one Kentucky county where Park National Bank operates and (ii) the six Florida counties and one Alabama county where Vision Bank operates. The primary industries represented by these customers include commercial real estate leasing, commercial real estate construction, manufacturing, retail trade, health care and other services.

Commercial loans are evaluated for the adequacy of repayment sources at the time of approval and are regularly reviewed for any possible deterioration in the ability of the borrower to repay the loan. The credit information required generally includes fully completed financial statements, two years of federal income tax returns and a current credit report. Loan terms include amortization schedules commensurate with the purpose of each loan, the source of each repayment and the risk involved. In most instances, collateral is required to provide an additional source of repayment in the event of default by a commercial borrower. The structure of the collateral package, including the type and amount of the collateral, varies from loan to loan depending on the financial strength of the borrower, the amount and terms of the loan and the collateral available to be pledged by the borrower. Most often, the collateral is inventory, machinery, accounts receivable or real estate. The guarantee of the principals will generally be required on loans made to closely-held business entities.

Commercial real estate loans include mortgage loans to developers and owners of commercial real estate. The lending policy for commercial real estate loans is the same as that for the commercial loan portfolio. The collateral for these loans is the underlying commercial real estate. Each subsidiary bank generally requires that the commercial real estate loan amount be no more than 85% of the purchase price or the appraised value of the real estate securing the loan. Commercial real estate loans made for each subsidiary bank’s portfolio generally have a variable interest rate although occasionally a commercial real estate loan may be made with a fixed interest rate for a term generally not exceeding five years.

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The regulatory limit for loans made to one borrower by Park National Bank was $69.2 million at December 31, 2008. Vision Bank’s regulatory limits for loans made to one borrower were $21.3 million for a secured loan or $12.8 million for an unsecured loan, at December 31, 2008. Participations in a loan by one or both of Park’s subsidiary banks in an amount larger than $25.0 million are generally sold to third party banks or financial institutions.

Park has a loan review program which annually evaluates substantially all (approximately 90%) of the loans with an outstanding balance greater than $250,000. If deterioration has occurred, the lender subsidiary takes effective and prompt action designed to increase the likelihood of payment of the loan. Upon detection of the reduced ability of a borrower to service interest and/or principal on a loan, the subsidiary may downgrade the loan and, under certain circumstances, place the loan on nonaccrual status. The subsidiary then works with the borrower to develop a payment schedule which the subsidiary anticipates will permit service of the principal and interest on the loan by the borrower. Loans which deteriorate and show the inability of a borrower to repay principal and do not meet the subsidiary’s standards are charged off quarterly. Information about Park’s policy for placing loans on nonaccrual status is included under the caption “Loans” in Note 1 of the Notes to Consolidated Financial Statements located on page 54 of Park’s 2008 Annual Report, and is incorporated herein by reference.

Commercial loans are generally viewed as having a higher credit risk than consumer loans because commercial loans usually involve larger loan balances to a single borrower and are more susceptible to a risk of default during an economic downturn. The total indebtedness of the largest single borrower within the commercial portfolio was $26.8 million at December 31, 2008. Since commercial loans generally have variable interest rates, an increase in interest rates increases the debt service requirement for the borrower, and a decrease in interest rates decreases the debt service requirement for the borrower. Credit risk for commercial loans arises from borrowers lacking the ability or willingness to pay principal or interest and, in the case of secured loans, by a shortfall in the collateral value in relation to the outstanding loan balance in the event of a default and subsequent liquidation of collateral. In the case of commercial loans secured by accounts receivable, the availability of funds for the repayment of these loans may be substantially dependent on the ability of the borrower to collect amounts due from its customers. Other collateral securing commercial loans may depreciate over time, may be difficult to appraise and may fluctuate in value based on success of the borrower’s business. Information concerning the loan loss experience and allowance for loan losses related to the commercial loan portfolio and the commercial real estate portfolio is provided in Tables 7 and 8 included in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on page 40, and is incorporated herein by reference.

Aircraft Financing

Scope Aircraft Finance specializes in aircraft financing. The customers of Scope Aircraft Finance include small businesses and entrepreneurs intending to use the aircraft for business or pleasure. The customers of Scope Aircraft Finance are located throughout the United States. The lending officers of Scope Aircraft Finance are experienced in the aircraft financing industry and rely upon that experience and industry guides in determining whether to grant an aircraft loan or lease. At December 31, 2008, Scope Aircraft Finance had outstanding approximately $100 million in loans primarily secured by aircraft (which are included in the commercial loan portfolio).

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Consumer Loans

At December 31, 2008, Park’s subsidiary banks, together with Park Leasing and Guardian Finance, had outstanding consumer loans (including automobile leases and home-equity-based credit cards) in an aggregate amount of approximately $643.5 million, constituting approximately 14% of their aggregate total loan portfolio. These subsidiaries make installment credit available to customers and prospective customers in their primary market areas of (i) central and southern Ohio and Northern Kentucky for Park National Bank and (ii) the Gulf Coast communities in Baldwin County, Alabama and the Florida panhandle for Vision Bank.

Credit approval for consumer loans requires income sufficient to repay principal and interest due, stability of employment, a positive credit record and sufficient collateral for secured loans. It is the policy of Park’s subsidiaries to adhere strictly to all laws and regulations governing consumer lending. A qualified compliance officer is responsible for monitoring each subsidiary’s performance and advising and updating loan personnel in this area. Each subsidiary reviews its consumer loan portfolio monthly and charges off loans which do not meet that subsidiary’s standards. Information about Park’s policy for placing loans on nonaccrual status is included under the caption “Loans” in Note 1 of the Notes to Consolidated Financial Statements located on page 54 of Park’s 2008 Annual Report, and is incorporated herein by reference. Each subsidiary bank and its divisions (other than The Park National Bank of Southwest Ohio & Northern Kentucky division of Park National Bank) also offers home-equity-based credit card accounts through its consumer lending department. These accounts are administered under the same standards as other consumer loans and leases.

Consumer loans typically have shorter terms and lower balances with higher yields as compared to real estate mortgage loans, but generally carry higher risks of default. Consumer loan collections are dependent on the borrower’s continuing financial stability, and thus are more likely to be affected by adverse personal circumstances. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount that can be recovered on these loans. Information concerning the loan loss experience and allowance for loan losses related to the consumer loan portfolio is provided in Tables 7 and 8 included in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on page 40, and is incorporated herein by reference.

Residential Real Estate and Construction Loans

At December 31, 2008, Park’s subsidiary banks had outstanding approximately $2,094 million in residential real estate, home equity lines of credit and construction mortgages, representing approximately 46.6% of total loans outstanding. Of this amount, approximately $1,286 million represented residential real estate loans, $274 million represented home equity lines of credit and $534 million represented construction loans. The market area for real estate lending by the subsidiary banks is concentrated in (i) central and southern Ohio and Northern Kentucky for Park National Bank and (ii) the Gulf Coast communities in Baldwin County, Alabama and the Florida panhandle for Vision Bank. Park had approximately $34 million of net charge-offs resulting from construction loans during the year ended December 31, 2008. Vision Bank accounted for approximately $29 million, or 85% of this total. At December 31, 2008, Vision Bank had approximately $285 million outstanding in construction loans, or 53% of Park’s consolidated total at the end of 2008. In addition to construction loans, Vision Bank had approximately $156 million of residential real estate loans and $44 million of home equity lines of credit.

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Credit approval for residential real estate loans requires demonstration of sufficient income to repay the principal and interest and the real estate taxes and insurance, stability of employment, a positive credit record and the appropriate appraised value of the real estate securing the loan. All loans are sent through automated underwriting to determine a risk classification. All loans receiving a risk classification of caution require review by a senior lender and generally require additional documentation if the loan is approved.

Each subsidiary bank generally requires that the residential real estate loan amount be no more than 80% of the purchase price or the appraised value of the real estate securing the loan, unless private mortgage insurance is obtained by the borrower. Loans made for each subsidiary bank’s portfolio in this lending category are generally adjustable rate, fully amortized mortgages. Each subsidiary bank also originates fixed rate real estate loans for the secondary market. These loans are generally sold immediately after closing. All real estate loans are secured by first mortgages with evidence of title in favor of the subsidiary bank in the form of an attorney’s opinion of title or a title insurance policy. Each subsidiary bank also requires proof of hazard insurance with the subsidiary bank named as the mortgagee and as the loss payee. Independent appraisals are generally obtained for consumer real estate loans.

Home equity lines of credit are generally made as second mortgages by Park’s subsidiary banks. The maximum amount of a home equity line of credit is generally limited to 85% of the appraised value of the property less the balance of the first mortgage. For Vision Bank, this percentage can be as high as 89.9% depending on the credit score and debt-to-income ratio of the borrower. The home equity lines of credit are written with ten-year terms for Park National Bank and 25-year terms for Vision Bank. A variable interest rate is generally charged on the home equity lines of credit.

Information concerning the loan loss experience and allowance for loan losses related to the residential real estate portfolio is provided in Tables 7 and 8 included in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on page 40, and is incorporated herein by reference.

Construction loans include commercial construction loans as well as residential construction loans. Construction loans may be in the form of a permanent loan or a short-term construction loan, depending on the needs of the individual borrower. Generally, the permanent construction loans have a variable interest rate although occasionally a permanent construction loan may be made with a fixed interest rate for a term generally not exceeding five years. Short-term construction loans are made with variable interest rates. Information concerning the loan maturity distribution within the construction financing portfolio is provided in Table 3 included in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on page 35, and is incorporated herein by reference.

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Construction financing is generally considered to involve a higher degree of risk of loss than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property’s value at completion of construction and the estimated cost (including interest) of construction. If the estimate of construction cost proves to be inaccurate, the subsidiary bank making the loan may be required to advance funds beyond the amount originally committed to permit completion of the project. If the estimate of value proves inaccurate, the subsidiary bank may be confronted, at or prior to the maturity of the loan, with a project having a value insufficient to assure full repayment, should the borrower default. In the event a default on a construction loan occurs and foreclosure follows, the subsidiary bank must take control of the project and attempt either to arrange for completion of construction or dispose of the unfinished project. Additional risk exists with respect to loans made to developers who do not have a buyer for the property, as the developer may lack funds to pay the loan if the property is not sold upon completion. Park’s subsidiary banks attempt to reduce such risks on loans to developers by requiring personal guarantees and reviewing current personal financial statements and tax returns as well as other projects undertaken by the developer. Information concerning the loan loss experience and allowance for loan losses related to the construction financing portfolio is provided in Tables 7 and 8 included in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on page 40, and is incorporated herein by reference.

Ohio-Based Insurance Agency

Park Insurance Group offers life insurance and other insurance products to its customers through licensed representatives who work for Park National Bank. Park Insurance Group’s customers include current customers of Park National Bank and other residents in the 29 Ohio counties and one Kentucky county served by Park National Bank. Park Insurance Group’s results to date have not been material to the consolidated entity.

Title Agency

Park Title Agency is a traditional title agency serving residential and commercial customers in the central Ohio area who are seeking title insurance for purchases, construction and refinancing of real estate. Park Title Agency’s customers include current customers of Park National Bank and other residents primarily in the 29 Ohio counties and one Kentucky county served by Park National Bank.

Vision Bancshares Financial Group

Vision Bancshares Financial Group conducts permissible insurance and securities networking activities. In an agency capacity, Vision Bancshares Financial Group offers its customers fixed and variable annuities, life insurance, property and casualty insurance and investment products, through licensed representatives who work for Vision Bank. The securities activities of Vision Bancshares Financial Group consist primarily of selling equity securities, municipal bonds, agency bonds, corporate bonds, mutual funds and variable rate annuities on a retail basis, through duly licensed and qualified employees and pursuant to a third party networking agreement. Vision Bancshares Financial Group’s results since the consummation of the Vision Merger have not been material to the consolidated entity.

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Competition

The financial services industry is highly competitive. Park’s subsidiaries compete with other local, regional and national service providers, including banks, savings associations, credit unions and other types of financial institutions, finance companies, insurance agencies and title agencies. Other competitors include securities dealers, brokers, mortgage bankers, investment advisors, insurance companies and financial services subsidiaries of commercial and manufacturing companies. Many of these competitors enjoy the benefits of advanced technology, fewer regulatory constraints and lower cost structures. Many of the newer competitors offer one-stop financial services to their customers that may include services that banks and their subsidiaries may not have been able or legally permitted to offer their customers in the past. The primary factors in competing for loans are interest rates charged and overall services provided to borrowers. The primary factors in competing for deposits are interest rates paid on deposits, account liquidity, convenience and hours of office locations and having trained and competent staff to deliver services.

Employees

As of December 31, 2008, Park and its subsidiaries had 2,051 full-time equivalent employees.

Supervision and Regulation of Park and its Subsidiaries

Park, its subsidiary banks and many of its other subsidiaries are subject to extensive regulation by federal and state agencies. The regulation of bank holding companies and their subsidiaries is intended primarily for the protection of consumers, depositors, federal deposit insurance funds and the banking system as a whole and not for the protection of shareholders.

Park is registered with the Federal Reserve Board as a bank holding company under the Bank Holding Company Act. As a bank holding company, Park is subject to regulation under the Bank Holding Company Act and to inspection, examination and supervision by the Federal Reserve Board. Park is also subject to the disclosure and regulatory requirements of the Securities Act of 1933, as amended, and the Exchange Act, as administered by the SEC. Park’s Common Shares are listed on NYSE Alternext under the trading symbol “PRK,” which subjects Park to the NYSE Alternext Company Guide for listed companies. As a result of Park’s participation in the U.S. Treasury’s Capital Purchase Program, Park is also subject to the regulatory authority granted to the U.S. Treasury and the Special Inspector General for the Troubled Asset Relief Program under EESA and ARRA, as discussed below under the caption “- Capital Purchase Program.”

Park National Bank, as a national banking association, is subject to regulation, supervision and examination primarily by the OCC and secondarily by the FDIC.

Vision Bank, as a Florida state-chartered bank, is subject to regulation, supervision and examination by the Florida Office of Financial Regulation and the FDIC.

Guardian Finance, as an Ohio state-chartered consumer finance company, is subject to regulation, supervision and examination by the Ohio Division of Financial Institutions.

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Park Insurance Group, as an Ohio state-chartered insurance agency, and Park Title Agency, as an Ohio state-chartered title agency, are subject to regulation, supervision and examination by the Ohio Department of Insurance.

The following information describes selected federal and state statutory and regulatory provisions and is qualified in its entirety by reference to the full text of the particular statutory or regulatory provisions. These statutes and regulations are continually under review by the United States Congress and state legislatures and federal and state regulatory agencies. A change in statutes, regulations or regulatory policies applicable to Park and its subsidiaries could have a material effect on their respective businesses.

Regulation of Bank Holding Companies

As a bank holding company, Park’s activities are subject to extensive regulation by the Federal Reserve Board. Park is required to file reports with the Federal Reserve Board and such additional information as the Federal Reserve Board may require, and is subject to regular examinations by the Federal Reserve Board.

The Federal Reserve Board also has extensive enforcement authority over bank holding companies, including, among other things, the ability to:

• assess civil money penalties;

• issue cease and desist or removal orders; and

• require that a bank holding company divest subsidiaries (including its subsidiary banks).

In general, the Federal Reserve Board may initiate enforcement actions for violations of laws and regulations and unsafe or unsound practices.

Under Federal Reserve Board policy, a bank holding company is expected to act as a source of financial strength to each subsidiary bank and to commit resources to support those subsidiary banks. Under this policy, the Federal Reserve Board may require a bank holding company to contribute additional capital to an undercapitalized subsidiary bank.

The Bank Holding Company Act requires the prior approval of the Federal Reserve Board in any case where a bank holding company proposes to:

• acquire direct or indirect ownership or control of more than 5% of the voting shares of any bank that is not already majority-owned by it;

• acquire all or substantially all of the assets of another bank or another financial or bank holding company; or

• merge or consolidate with any other financial or bank holding company.

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The Gramm-Leach-Bliley Act of 1999 (“GLBA”) permits a qualifying bank holding company to become a financial holding company and thereby affiliate with securities firms and insurance companies and engage in other activities that are financial in nature. Although Park was a financial holding company effective in December 2007, Park ceased to be a financial holding company effective June 30, 2008 and neither Park nor any of its subsidiaries engages in any of the activities permitted for a financial holding company but not a bank holding company.

Subsidiary banks of a bank holding company are subject to certain restrictions imposed by the Federal Reserve Act on the maintenance of reserves against deposits, extensions of credit to the bank holding company or any of its subsidiaries, investments in the stock or other securities of the bank holding company or its subsidiaries and the taking of such stock or securities as collateral for loans to any borrower. Further, a bank holding company and its subsidiaries are prohibited from engaging in certain tying arrangements in connection with any extension of credit, lease or sale of property or furnishing of any services. Various consumer laws and regulations also affect the operations of these subsidiaries.

Transactions with Affiliates, Directors, Executive Officers and Shareholders

Sections 23A and 23B of the Federal Reserve Act and Federal Reserve Board Regulation W generally:

• limit the extent to which a bank or its subsidiaries may engage in “covered transactions” with any one affiliate;

• limit the extent to which a bank or its subsidiaries may engage in “covered transactions” with all affiliates; and

• require that all such transactions be on terms substantially the same, or at least as favorable to the bank or subsidiary, as those provided to a non-affiliate.

An affiliate of a bank is any company or entity which controls, is controlled by or is under common control with the bank. The term “covered transaction” includes the making of loans to the affiliate, the purchase of assets from the affiliate, the issuance of a guarantee on behalf of the affiliate, the purchase of securities issued by the affiliate and other similar types of transactions.

A bank’s authority to extend credit to executive officers, directors and greater than 10% shareholders, as well as entities such persons control, is subject to Sections 22(g) and 22(h) of the Federal Reserve Act and Regulation O promulgated thereunder by the Federal Reserve Board. Among other things, these loans must be made on terms (including interest rates charged and collateral required) substantially the same as those offered to unaffiliated individuals or be made as part of a benefit or compensation program and on terms widely available to employees, and must not involve a greater than normal risk of repayment. In addition, the amount of loans a bank may make to these persons is based, in part, on the bank’s capital position, and specified approval procedures must be followed in making loans which exceed specified amounts.

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Regulation of Nationally-Chartered Banks

As a national banking association, Park National Bank is subject to regulation under the National Banking Act and is periodically examined by the OCC. Furthermore, it is subject, as a member bank, to certain rules and regulations of the Federal Reserve Board. Park National Bank is an insured institution as a member of the Deposit Insurance Fund. As a result, it is subject to regulation by the FDIC. In addition, the establishment of branches by Park National Bank is subject to prior approval of the OCC.

Regulation of Consumer Finance Companies

As a consumer finance company incorporated under Ohio law, Guardian Finance is subject to regulation and supervision by the Division of Financial Institutions. Division regulation and supervision designed to protect consumers affect the lending activities of Guardian Finance, including interest rates and certain loan terms, advertising and record retention. If grounds provided by law exist, the Division of Financial Institutions may suspend or revoke an Ohio consumer finance company’s ability to make loans.

Regulation of Florida State-Chartered Banks

Vision Bank is organized under the laws of the State of Florida and its deposits are insured by the FDIC up to the maximum amount permitted by law. Vision Bank is subject to regulation, supervision and regular examination by the State of Florida’s Office of Financial Regulation and the FDIC. Federal and state banking laws and regulations regulate, among other things, the scope of the banking business conducted by Vision Bank, its loans and investments, reserves against deposits, mergers and acquisitions, borrowings, dividends, minimum capital requirements and the locations of financial service offices and certain facilities. The relationships of Vision Bank to its executive officers, directors and affiliates are also the subject of statutory and regulatory requirements. Both the Office of Financial Regulation and the FDIC have the authority to impose regulatory sanctions upon Florida state-charted banks and, if the circumstances provided by federal and state laws and regulations exist, may place a Florida state-chartered bank in receivership or conservatorship.

Federal Deposit Insurance Corporation

The FDIC is an independent federal agency which insures the deposits, up to prescribed statutory limits, of federally-insured banks and savings associations and safeguards the safety and soundness of the financial institution industry.

Insurance Premiums

Insurance premiums for each insured institution are determined based upon the institution’s capital level and supervisory rating provided to the FDIC by the institution’s primary federal regulator and other information the FDIC determines to be relevant to the risk posed to the deposit insurance fund by the institution. The assessment rate determined by considering such information is then applied to the amount of the institution’s deposits to determine the institution’s insurance premium. An increase in the assessment rate could have a material adverse effect on the earnings of the affected institutions, depending on the amount of the increase.

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Insurance of deposits may be terminated by the FDIC upon a finding that the insured institution has engaged in unsafe or unsound practices, is in an unsafe or unsound condition to continue operations, or has violated any applicable law, regulation, rule, order or condition enacted or imposed by the institution’s regulatory agency.

Liability of Commonly Controlled Banks

Under the Federal Deposit Insurance Act, a bank is generally liable for any loss incurred, or reasonably expected to be incurred, by the FDIC in connection with (i) the default of a commonly controlled bank or (ii) any assistance provided by the FDIC to a commonly controlled bank in danger of default. “Default” means generally the appointment of a conservator or receiver. “In danger of default” means generally the existence of conditions indicating that a default is likely to occur in the absence of regulatory assistance.

Federal Home Loan Bank

The Federal Home Loan Banks (“FHLBs”) provide credit to their members in the form of advances. Park National Bank is a member of the FHLB of Cincinnati and Vision Bank is a member of the FHLB of Atlanta. As FHLB members, Park National Bank and Vision Bank must maintain an investment in the capital stock of their respective FHLBs.

Upon the origination or renewal of a loan or advance, each FHLB is required by law to obtain and maintain a security interest in certain types of collateral. Each FHLB is required to establish standards of community investment or service that its members must maintain for continued access to long-term advances from the FHLB. The standards take into account a member’s performance under the Community Reinvestment Act and its record of lending to first-time home buyers. All long-term advances by each FHLB must be made only to provide funds for residential housing finance.

Regulatory Capital

The Federal Reserve Board has adopted risk-based capital guidelines for bank holding companies and state member banks. The OCC and the FDIC have adopted risk-based capital guidelines for national banks and state non-member banks, respectively. The guidelines provide a systematic analytical framework which makes regulatory capital requirements sensitive to differences in risk profiles among banking organizations, takes off-balance sheet exposures expressly into account in evaluating capital adequacy, and minimizes disincentives to holding liquid, low-risk assets. Capital levels as measured by these standards are also used to categorize financial institutions for purposes of certain prompt corrective action regulatory provisions.

The minimum guideline for the ratio of total capital to risk-weighted assets (including certain off-balance sheet items such as standby letters of credit) is 8%. At least half of the minimum total risk-based capital ratio (4%) must be composed of common shareholders’ equity, minority interests in certain equity accounts of consolidated subsidiaries and a limited amount of qualifying preferred stock and qualified trust preferred securities, less goodwill and certain other intangible assets, including the unrealized net gains and losses, after applicable taxes, on available-for-sale securities carried at fair value (commonly known as “Tier 1” risk-based capital). The remainder of total risk-based capital (commonly known as “Tier 2” risk-based capital) may consist of certain amounts of hybrid capital instruments, mandatory convertible debt, subordinated debt, preferred stock not qualifying as Tier 1 capital, loan and lease loss allowance and net unrealized gains on certain available-for-sale equity securities, all subject to limitations established by the guidelines.

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Under the guidelines, capital is compared to the relative risk related to the balance sheet. To derive the risk included in the balance sheet, one of four risk weights (0%, 20%, 50% and 100%) is applied to different balance sheet and off-balance sheet assets, primarily based on the relative credit risk of the counterparty. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

The Federal Reserve Board has established minimum leverage ratio guidelines for bank holding companies. The Federal Reserve Board guidelines provide for a minimum ratio of Tier 1 capital to average assets (excluding the loan and lease loss allowance, goodwill and certain other intangibles), or “leverage ratio,” of 3% for bank holding companies that meet certain criteria, including having the highest regulatory rating, and 4% for all other bank holding companies. The guidelines further provide that bank holding companies making acquisitions will be expected to maintain strong capital positions substantially above the minimum levels. The OCC and the FDIC have each also adopted minimum leverage ratio guidelines for national banks and for state non-member banks, respectively.

The Federal Reserve Board’s review of certain bank holding company transactions is affected by whether the applying bank holding company is “well-capitalized.” To be deemed “well-capitalized,” the bank holding company must have a Tier 1 risk-based capital ratio of at least 6% and a total risk-based capital ratio of at least 10%, and must not be subject to any written agreement, order, capital directive or prompt corrective action directive issued by the Federal Reserve Board to meet and maintain a specific capital level for any capital measure. Park’s capital ratios meet the requirements to be deemed “well capitalized” under the Federal Reserve Board’s guidelines.

The federal banking agencies have established a system of prompt corrective action to resolve certain of the problems of undercapitalized institutions. This system is based on five capital level categories for insured depository institutions: “well capitalized,” “adequately capitalized,” “undercapitalized,” “significantly undercapitalized,” and “critically undercapitalized.”

The federal banking agencies may (or in some cases must) take certain supervisory actions depending upon a bank’s capital level. For example, the banking agencies must appoint a receiver or conservator for a bank within 90 days after it becomes “critically undercapitalized” unless the bank’s primary regulator determines, with the concurrence of the FDIC, that other action would better achieve regulatory purposes. Banking operations otherwise may be significantly affected depending on a bank’s capital category. For example, a bank that is not “well capitalized” generally is prohibited from accepting brokered deposits and offering interest rates on deposits higher than the prevailing rate in its market, and the holding company of any undercapitalized depository institution must guarantee, in part, specific aspects of the bank’s capital plan for the plan to be acceptable.

In order to be “well-capitalized,” a bank must have total risk-based capital of at least 10%, Tier 1 risk-based capital of at least 6% and a leverage ratio of at least 5%, and the bank must not be subject to any written agreement, order, capital directive or prompt corrective action directive to meet and maintain a specific capital level for any capital measure. Park’s management believes that each of its subsidiary banks meets the ratio requirements to be deemed “well capitalized” according to the guidelines described above. See Note 22 of the Notes to Consolidated Financial Statements located on pages 68 and 69 of Park’s 2008 Annual Report, which is incorporated herein by reference.

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The risk-based capital guidelines adopted by the federal banking agencies are based on the “International Convergence of Capital Measurement and Capital Standards” (Basel I), published by the Basel Committee on Banking Supervision (the “Basel Committee”) in 1988. In 2004, the Basel Committee published a new, more risk-sensitive capital adequacy framework (Basel II) for large, internationally active banking organizations. In December 2007, the federal banking agencies issued final rules making the implementation of certain parts of Basel II mandatory for any bank that has consolidated total assets of at least $250 billion (excluding certain assets) or has consolidated on-balance sheet foreign exposure of at least $10 billion, and making it voluntary for other banks.

In response to concerns regarding the complexity and cost associated with implementing the Basel II rules, in July 2008, the federal banking agencies issued a notice of proposed rulemaking that would revise the existing risk-based capital framework for banks that will not be subject to the Basel II rules. The proposed rules would allow banks other than the large Basel II banks to elect to adopt the new risk weighting methodologies set forth in the proposed rules or remain subject to the existing risk-based capital rules.

Park will not be required to implement Basel II. Until the final rules for the non-Basel II banks are adopted by the federal banking agencies, Park is unable to predict whether and when its subsidiary banks will adopt the new capital guidelines.

Fiscal and Monetary Policies

The business and earnings of Park are affected significantly by the fiscal and monetary policies of the United States Government and its agencies. Park is particularly affected by the policies of the Federal Reserve Board, which regulates the supply of money and credit in the United States. These policies are used in varying degrees and combinations to directly affect the availability of bank loans and deposits, as well as the interest rates charged on loans and paid on deposits.

Limits on Dividends and Other Payments

There are various legal limitations on the extent to which subsidiary banks may finance or otherwise supply funds to their parent holding companies. Under applicable federal and state laws, subsidiary banks may not, subject to certain limited exceptions, make loans or extensions of credit to, or investments in the securities of, their bank holding companies. Subsidiary banks are also subject to collateral security requirements for any loan or extension of credit permitted by such exceptions.

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Neither of Park’s subsidiary banks may pay dividends out of its surplus if, after paying these dividends, it would fail to meet the required minimum levels under the risk-based capital guidelines and minimum leverage ratio requirements established by the OCC and the FDIC. In addition, each subsidiary bank must have the approval of its regulatory authority if a dividend in any year would cause the total dividends for that year to exceed the sum of the subsidiary bank’s current year’s “net profits” (or net income, less dividends declared during the period based on regulatory accounting principles) and the retained net profits for the preceding two years, less required transfers to surplus. Payment of dividends by either of Park’s subsidiary banks may be restricted at any time at the discretion of its regulatory authorities, if such regulatory authorities deem such dividends to constitute unsafe and/or unsound banking practices or if necessary to maintain adequate capital.

The ability of Park to obtain funds for the payment of dividends and for other cash requirements is largely dependent on the amount of dividends which may be declared by its subsidiary banks. However, the Federal Reserve Board expects Park to serve as a source of strength to its subsidiary banks, which may require Park to retain capital for further investment in its subsidiary banks, rather than pay dividends to the Park shareholders. Payment of dividends by one of Park’s subsidiary banks may be restricted at any time at the discretion of its applicable regulatory authorities, if they deem such dividends to constitute an unsafe and/or unsound banking practice. These provisions could have the effect of limiting Park’s ability to pay dividends on its Common Shares.

At December 31, 2008, approximately $19.9 million of the total stockholders’ equity of the bank subsidiaries was available for payment to Park without the approval of the applicable regulatory authorities. See Note 17 of the Notes to Consolidated Financial Statements located on page 66 of Park’s 2008 Annual Report.

Under the terms of the Indenture governing the $15.5 million of junior subordinated debentures issued by Vision to the Vision Trust and the related Guarantee Agreement, Park, as successor to Vision in accordance with the First Supplemental Indenture, is prohibited, subject to limited exceptions, from declaring or paying any dividends or distributions on any shares of its capital stock (i) if an event of default under the Indenture has occurred and continues, (ii) if Park is in default with respect to the payment of any obligations under the Guarantee Agreement or (iii) during any period in which the payment of interest on the junior subordinated debentures by Park (and the payment of cash distributions on the floating rate preferred securities of the Vision Trust) is being deferred.

The dividend rights of holders of Park Common Shares are also qualified and subject to the dividend rights of holders of Series A Preferred Shares described above under the caption “Recent Developments — Participation in Capital Purchase Program Enacted as part of Troubled Assets Relief Program” and below under the caption “- Capital Purchase Program.”

Privacy Provisions of Gramm-Leach-Bliley Act

Under the GLBA, federal banking regulators were required to adopt rules that limit the ability of banks and other financial institutions to disclose non-public information about consumers to nonaffiliated third parties. These limitations require disclosure of privacy policies to consumers and, in some circumstances, allow consumers to prevent disclosure of certain personal information to a nonaffiliated third party.

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Patriot Act

In response to the terrorist events of September 11, 2001, the Uniting and Strengthening of America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the “Patriot Act”) was signed into law in October 2001. The Patriot Act gives the United States Government powers to address terrorist threats through enhanced domestic security measures, expanded surveillance powers, increased information sharing and broadened anti-money laundering requirements. Title III of the Patriot Act takes measures intended to encourage information sharing among bank regulatory agencies and law enforcement bodies. Further, certain provisions of Title III impose affirmative obligations on a broad range of financial institutions. Among other requirements, Title III and related regulations require regulated financial institutions to establish a program specifying procedures for obtaining identifying information from customers seeking to open new accounts and establish enhanced due diligence policies, procedures and controls designed to detect and report suspicious activity. Park’s subsidiary banks have established policies and procedures that are believed to be compliant with the requirements of the Patriot Act.

Corporate Governance

As mandated by the Sarbanes-Oxley Act of 2002, the SEC has adopted rules and regulations governing, among other issues, corporate governance, auditing and accounting, executive compensation and enhanced and timely disclosure of corporate information. NYSE Alternext has also adopted corporate governance rules. The Board of Directors of Park has taken a series of actions to strengthen and improve Park’s already strong corporate governance practices in light of the rules of the SEC and NYSE Alternext. The Board of Directors has adopted charters for the Audit Committee, the Compensation Committee, the Nominating Committee and the Risk Committee as well as a Code of Business Conduct and Ethics governing the directors, officers and associates of Park and its affiliates.

Capital Purchase Program

In response to the financial crisis affecting the banking system and financial markets, the EESA was signed into law on October 3, 2008 creating the Troubled Assets Relief Program (“TARP”). As part of TARP, the U.S. Treasury established the Capital Purchase Program to provide up to $700 billion of funding to eligible financial institutions through the purchase of capital stock and other financial instruments for the purpose of stabilizing and providing liquidity to the United States financial markets. In connection with the EESA, there have been numerous actions by the Federal Reserve Board, the United States Congress, the U.S. Treasury, the FDIC, the SEC and others to further the economic and banking industry stabilization efforts under the EESA. It remains unclear at this time what further legislative and regulatory measures will be implemented under the EESA that affect Park.

The ARRA was signed into law on February 17, 2009. The ARRA includes a wide array of programs intended to stimulate the economy and provide for extensive infrastructure, energy, health and education needs. In addition, the ARRA imposes certain new executive compensation and corporate expenditure limits on all current and future recipients of funds under the Capital Purchase Program, including Park, as long as any obligation arising from the financial assistance provided to the recipient under the Capital Purchase Program remains outstanding. The ARRA permits such recipients, subject to consultation with the appropriate federal banking agency, to repay to the U.S. Treasury any financial assistance received under the Capital Purchase Program without penalty, delay or the need to raise additional replacement capital.

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As discussed in more detail above under the caption “Recent Developments — Participation in Capital Purchase Program Enacted as part of Troubled Assets Relief Program,” Park elected to participate in the Capital Purchase Program of the U.S. Treasury enacted as part of the Troubled Asset Relief Program under the EESA. Pursuant to the Capital Purchase Program, on December 23, 2008, the U.S. Treasury purchased 100,000 Series A Preferred Shares from Park, as well as the Warrant to purchase 227,376 Common Shares of Park. As part of participation in the Capital Purchase Program, Park agreed to various requirements and restrictions imposed on all participants in the Capital Purchase Program. Among the terms of participation was a provision that the U.S. Treasury could change the terms of participation at any time.

The current terms of participation in the Capital Purchase Program include the following:

• Park must file with the SEC a registration statement under the Securities Act of 1933 registering for resale the Series A Preferred Shares or, in the event the Series A Preferred Shares are deposited with a depository at the request of the U.S. Treasury, depository shares evidencing fractional interests in the Series A Preferred Shares; the Warrant to purchase 227,376 Common Shares; and any Common Shares issuable from time to time upon exercise of the Warrant. On January 22, 2009, Park filed a Registration Statement on Form S-3 to register these securities, which Registration Statement became effective on filing.

• As long as the Series A Preferred Shares remain outstanding, unless all accrued and unpaid dividends for all past dividend periods on the Series A Preferred Shares are fully paid, Park will not be permitted to declare or pay dividends on any Common Shares, any junior preferred shares or, generally, any preferred shares ranking pari passu with the Series A Preferred Shares (other than in the case of pari passu preferred shares, dividends on a pro rata basis with the Series A Preferred Shares), nor will Park be permitted to repurchase or redeem any Common Shares or preferred shares other than the Series A Preferred Shares.

• Unless the Series A Preferred Shares have been transferred to unaffiliated third parties or redeemed in whole, until December 23, 2011, the U.S. Treasury’s approval is required for any increase in common share dividends or any share repurchases other than repurchases of the Series A Preferred Shares, repurchases of junior preferred shares or Common Shares in connection with the administration of any employee benefit plan in the ordinary course of business and consistent with past practice and purchases under certain other limited circumstances specified in the Securities Purchase Agreement with the U.S. Treasury.

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• As a recipient of government funding under the Capital Purchase Program, Park must comply with the executive compensation and corporate governance standards imposed by the ARRA for so long as the U.S. Treasury holds any securities acquired from Park pursuant to the Securities Purchase Agreement or upon exercise of the Warrant, excluding any period during which the U.S. Treasury holds only the Warrant (the “Covered Period”). The ARRA executive compensation standards apply to Park’s Senior Executive Officers (as defined in the ARRA) as well as other employees. The ARRA directs the U.S. Treasury to adopt implementing rules for these standards and also grants to the U.S. Treasury the authority to establish additional standards. These standards are more stringent than those currently in effect under the Capital Purchase Program and the Securities Purchase Agreement or those previously proposed by the U.S. Treasury, but it is still unclear how these standards will relate to the similar standards announced by the U.S. Treasury in the guidelines it issued on February 4, 2009, or whether the standards will be considered effective immediately or only after the U.S Treasury adopts implementing regulations. The standards imposed by the ARRA include, without limitation, the following:

• ensuring that incentive compensation for Senior Executive Officers does not encourage unnecessary and excessive risks that threaten the value of the financial institution;

• any bonus, retention award or incentive compensation paid (or under a legally binding obligation to be paid) to a Senior Executive Officer or any of Park’s 20 next most highly-compensated employees based on statements of earnings, revenues, gains or other criteria that are later proven to be materially inaccurate must be subject to recovery or “clawback” by Park;

• Park is prohibited from paying or accruing any bonus, retention award or incentive compensation with respect to its five most highly-compensated employees or such higher number as the Secretary of the U.S. Treasury may determine is in the public interest, except for grants of restricted stock that do not fully vest during the Covered Period and do not have a value which exceeds one-third of an employee’s total annual compensation;

• severance payments to the Senior Executive Officers and Park’s five next most highly-compensated employees, generally referred to as “golden parachute” payments, are prohibited, except for payments for services performed or benefits accrued;

• compensation plans that encourage manipulation of reported earnings are prohibited;

• the U.S. Treasury may retroactively review bonuses, retention awards and other compensation previously paid to a Senior Executive Officer or any of Park’s 20 next most highly-compensated employees that the U.S. Treasury finds to be inconsistent with the purposes of TARP or otherwise contrary to the public interest;

• Park’s Board of Directors must establish a company-wide policy regarding excessive or luxury expenditures;

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• Park’s proxy statements for annual shareholder meetings must permit a nonbinding “say on pay” shareholder vote on the compensation of executives;

• compensation in excess of $500,000 for each Senior Executive Officer must not be deducted for federal income tax purposes; and

• compliance with the executive compensation reporting and recordkeeping requirements established by the U.S. Treasury.

Park has determined that it would be prudent not to pay the incentive compensation awards to Park’s three executive officers and two other most highly-compensated employees for the twelve-month period ended September 30, 2008 in light of the uncertainty as to the extent to which the ARRA executive compensation standards apply to Park.

The U.S. Treasury has certain supervisory and oversight duties and responsibilities under the EESA, the Capital Purchase Program and the ARRA. Also, the Special Inspector General for the Troubled Asset Relief Program (“SIGTARP”), which position was established pursuant to Section 121 of the EESA, has the duty, among other things, to conduct, supervise and coordinate audits and investigations of the purchase, management and sale of assets by the U.S. Treasury under TARP and the Capital Purchase Program, including the Series A Preferred Shares purchased from Park.

Statistical Disclosure

The statistical disclosure relating to Park and its subsidiaries required under the SEC’s Industry Guide 3, “Statistical Disclosure by Bank Holding Companies,” is included in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on pages 30 through 45, and in Note 1 of the Notes to Consolidated Financial Statements located on pages 54 through 58 of Park’s 2008 Annual Report, Note 4 of the Notes to Consolidated Financial Statements located on pages 59 through 61 of Park’s 2008 Annual Report, Note 5 of the Notes to Consolidated Financial Statements located on page 61 of Park’s 2008 Annual Report, Note 8 of the Notes to Consolidated Financial Statements located on page 62 of Park’s 2008 Annual Report and Note 9 of the Notes to Consolidated Financial Statements located on page 62 of Park’s 2008 Annual Report. This statistical disclosure is incorporated herein by reference.

Effect of Environmental Regulation

Compliance with federal, state and local provisions regulating the discharge of materials into the environment, or otherwise relating to the protection of the environment, has not had a material effect upon the capital expenditures, earnings or competitive position of Park and its subsidiaries. Park believes the nature of the operations of its subsidiaries has little, if any, environmental impact. Park, therefore, anticipates no material capital expenditures for environmental control facilities for its current fiscal year or for the foreseeable future.

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Park believes its primary exposure to environmental risk is through the lending activities of its subsidiaries. In cases where management believes environmental risk potentially exists, Park’s subsidiaries mitigate their environmental risk exposures by requiring environmental site assessments at the time of loan origination to confirm collateral quality as to commercial real estate parcels posing higher than normal potential for environmental impact, as determined by reference to present and past uses of the subject property and adjacent sites. In addition, environmental assessments are typically required prior to any foreclosure activity involving non-residential real estate collateral.

ITEM 1A. RISK FACTORS.

Cautionary Statement Regarding Forward-Looking Information

Certain statements contained in this Annual Report on Form 10-K which are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, the statements specifically identified as forward-looking statements within this document. In addition, certain statements in future filings by Park with the SEC, in press releases, and in oral and written statements made by or with the approval of Park which are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Examples of forward-looking statements include: (i) projections of income or expense, earnings per share, the payment or non-payment of dividends, capital structure and other financial items; (ii) statements of plans and objectives of Park or our management or Board of Directors, including those relating to products or services; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Words such as “believes,” “anticipates,” “expects,” “intends,” “targeted” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying those statements.

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements to encourage companies to provide prospective information so long as those statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those discussed in the forward-looking statements. We desire to take advantage of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements involve risks and uncertainties. Actual results may differ materially from those predicted by the forward-looking statements because of various factors and possible events, including those factors and events identified below. There is also the risk that Park’s management or Board of Directors incorrectly analyzes these risks and uncertainties or that the strategies Park develops to address them are unsuccessful.

Forward-looking statements speak only as of the date on which they are made, and, except as may be required by law, Park undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made to reflect unanticipated events. All subsequent written and oral forward-looking statements attributable to Park or any person acting on Park’s behalf are qualified in their entirety by the following cautionary statements.

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Difficult market conditions and economic trends have adversely affected our industry and our business.

Negative developments in the capital markets beginning in the latter half of 2007 and continuing throughout 2008 and into 2009 produced uncertainty in the financial markets in general and a related general economic downturn. Dramatic declines in the housing market, that resulted in decreasing home prices and increasing delinquencies and foreclosures, negatively impacted the credit performance of mortgage and construction loans and resulted in significant write-downs of assets by many financial institutions. In addition, the values of real estate collateral supporting many loans have declined and may continue to decline. The declines in the performance and value of mortgage assets started in the sub-prime market but spread to all mortgage and real estate asset classes, leveraged bank loans and nearly all other asset classes, including equity securities. These general downward economic trends, the reduced availability of commercial credit and increasing unemployment have all negatively impacted the credit performance of commercial and consumer credit and resulted in additional write-downs. Concerns over the stability of the financial markets and the economy have resulted in decreased lending by financial institutions to their customers and to each other. This market turmoil and tightening of credit has led to increased commercial and consumer deficiencies, lack of customer confidence, increased market volatility and widespread reduction in general business activity. Competition among depository institutions for deposits has increased significantly and financial institutions have experienced decreased access to deposits or borrowings. The resulting economic pressure on consumers and businesses and the lack of confidence in the financial markets may adversely affect our business, financial condition, results of operations and stock price. Also, our ability to assess the creditworthiness of customers and to estimate the losses inherent in our credit exposure is made more complex by these difficult market and economic conditions.

As a result of the foregoing factors, there is a potential for new federal or state laws and regulations regarding lending and funding practices and liquidity standards, and bank regulatory agencies are expected to be very aggressive in responding to concerns and trends identified in examinations. This increased governmental action may increase our costs and limit our ability to pursue certain business opportunities. We also may be required to pay even higher FDIC premiums than the recently increased level, because financial institution failures resulting from the depressed market conditions have depleted and may continue to deplete the deposit insurance fund and reduce its ratio of reserves to insured deposits.

As of the end of 2008, the United States is in a recession. Business activity across a wide range of industries and regions is greatly reduced and local governments and many companies are in serious difficulty due to the lack of consumer spending and the lack of liquidity in the credit markets. A worsening of current conditions would likely exacerbate the adverse effects of these difficult market and economic conditions on us, our customers and the other financial institutions in our market. As a result, we may experience increases in foreclosures, delinquencies and customer bankruptcies, as well as more restricted access to funds.

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Changes in economic and political conditions could adversely affect our earnings, as our borrowers’ ability to repay loans and the value of the collateral securing our loans decline.

Our success depends, to a certain extent, upon economic and political conditions, local and national, as well as governmental monetary policies. Conditions such as inflation, recession, unemployment, changes in interest rates, money supply and other factors beyond our control may adversely affect our asset quality, deposit levels and loan demand and, therefore, our earnings. Because we have a significant amount of real estate loans, additional decreases in real estate values could adversely affect the value of property used as collateral and our ability to sell the collateral upon foreclosure. Adverse changes in the economy may also have a negative effect on the ability of our borrowers to make timely repayments of their loans, which would have an adverse impact on our earnings. If during a period of reduced real estate values we are required to liquidate the collateral securing a loan to satisfy the debt or to increase our allowance for loan losses, it could materially reduce our profitability and adversely affect our financial condition. The substantial majority of our loans are to individuals and businesses in Ohio and in Gulf Coast communities in Alabama and on the Florida panhandle. Consequently, further significant declines in the economy in Ohio or in Gulf Coast communities in Alabama or the panhandle of Florida could have a materially adverse effect on our financial condition and results of operations.

We have experienced deteriorating credit conditions in the Ohio, Alabama and Florida markets in which we operate. Park had net loan charge-offs of $57.5 million for 2008 ($21.7 million for the fourth quarter of 2008) and recorded a provision for loan losses for 2008 of $70.5 million ($32.6 million for the fourth quarter of 2008). The provision for loan losses for 2007 was $29.5 million. Nonperforming loans, defined as loans that are 90 days past due and still accruing, nonaccrual and renegotiated loans, were $167.8 million, or 3.74% of total loans, at December 31, 2008, compared to $108.5 million, or 2.57% of total loans, at December 31, 2007. Nonaccrual loans increased by $58.4 million during 2008, $33.2 million of the increase coming in the fourth quarter.

Of the nearly $41 million increase in the provision for loan losses in 2008, $27.5 million was associated with Vision Bank. Vision Bank had $38.5 million of net loan charge-offs in 2008. Vision Bank’s loan loss provision for the twelve-month period ended December 31, 2008 exceeds the net loan charge-offs for the same period in 2008 by $8.4 million reflecting the deterioration of credit quality within Vision Bank’s portfolio. Vision Bank’s nonperforming loans increased from $79.3 million in September 30, 2008 to $94.7 million at December 31, 2008, representing 13.7% of Vision Bank’s outstanding loans at December 31, 2008.

Conditions in the State of Ohio also deteriorated during 2008. The provision for loan losses related to Park National Bank (and our Ohio-based subsidiary banks which merged into it) and Guardian Finance increased from $10.1 million in 2007 to $23.5 million in 2008. Park National Bank and its divisions had non-performing loans of $73.1 million at December 31, 2008, representing an increase of $28.1 million over the balance at December 31, 2007.

It is uncertain when the negative credit trends in our markets will reverse and, therefore, Park’s future earnings are susceptible to further declining credit conditions in the markets in which we operate.

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We extend credit to a variety of customers based on internally set standards and the judgment of our loan officers and bank presidents. We manage the credit risk through a program of underwriting standards, the review of certain credit decisions and an on-going process of assessing the quality of the credit already extended. Our credit standards and on-going process of credit assessment might not protect us from significant credit losses.

We take credit risk by virtue of making loans and leases, extending loan commitments and letters of credit and, to a lesser degree, purchasing non-governmental securities. Our exposure to credit risk is managed through the use of consistent underwriting standards that emphasize “in-market” lending while avoiding highly leveraged transactions as well as excessive industry and other concentrations. Our credit administration function employs risk management techniques to ensure that loans and leases adhere to corporate policy and problem loans and leases are promptly identified. While these procedures are designed to provide us with the information needed to implement policy adjustments where necessary, and to take proactive corrective actions, there can be no assurance that such measures will be effective in avoiding undue credit risk.

We may elect or be compelled to seek additional capital in the future, but that capital may not be available when it is needed.

We are required by federal and state regulatory authorities to maintain adequate levels of capital to support our operations. In addition, we may elect to raise additional capital to support our business or to finance acquisitions, if any, or we may otherwise elect or be required to raise additional capital. In that regard, a number of financial institutions have recently raised considerable amounts of capital in response to a deterioration in their results of operations and financial condition arising from the turmoil in the mortgage loan market, deteriorating economic conditions, declines in real estate values and other factors. Our ability to raise additional capital, if needed, will depend on conditions in the capital markets, economic conditions and a number of other factors, many of which are outside our control, and on our financial performance. Accordingly, there can be no assurance that we can raise additional capital if needed or on terms acceptable to us. If we cannot raise additional capital when needed, it may have a material adverse effect on our financial condition, results of operations and prospects.

Current levels of market volatility are unprecedented.

The capital and credit markets have been experiencing volatility and disruption for more than a year. In recent months, the volatility and disruption have reached unprecedented levels. In some cases, the markets have produced downward pressure on stock prices and credit availability for certain issuers without regard to those issuers’ underlying financial strength. If current levels of market disruption and volatility continue or worsen, there can be no assurance that we will not experience an adverse effect, which may be material, on our ability to access capital and on our business, financial condition and results of operations.

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Changes in interest rates could have a material adverse effect on our financial condition and results of operations.

Our earnings depend substantially on our interest rate spread, which is the difference between (i) the rates we earn on loans, investment securities and other interest earning assets and (ii) the interest rates we pay on deposits and our borrowings. These rates are highly sensitive to many factors beyond our control, including general economic conditions and the policies of various governmental and regulatory authorities. While we have taken measures intended to manage the risks of operating in a changing interest rate environment, there can be no assurance that such measures will be effective in avoiding undue interest rate risk. Information pertaining to the impact changes in interest rates could have on our net income is included in Table 10 in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW” on page 41, and is incorporated herein by reference.

There can be no assurance that recent legislative and regulatory initiatives to address difficult market and economic conditions will stabilize the United States banking system and the enactment of these initiatives may significantly affect our financial condition, results of operation, liquidity or stock price.

In 2008 and continuing into 2009, governments, regulators and central banks in the United States and worldwide have taken numerous steps to increase liquidity and to restore investor confidence, but asset values have continued to decline and access to liquidity continues to be very limited.

The EESA authorizes the U.S. Treasury to, among other things, purchase up to $700 billion of mortgages, mortgage-backed securities and certain other financial instruments from financial institutions and their holding companies, under TARP. The purpose of TARP is to restore confidence and stability to the United States banking system and to encourage financial institutions to increase their lending to customers and to each other. Under the Capital Purchase Program, which we participate in, the U.S. Treasury is purchasing equity securities from participating institutions. For more information regarding our participation in the Capital Purchase Program, see the discussion under the caption “Recent Developments — Participation in Capital Purchase Program Enacted as part of Troubled Assets Relief Program” in “Item 1 — Business” of Part I of this Annual Report on Form 10-K. The EESA also increased federal deposit insurance on most deposit accounts from $100,000 to $250,000. This increase is in place until the end of 2009 and is not covered by deposit insurance premiums paid by the banking industry. The ARRA, which was signed into law on February 17, 2009, includes a wide array of programs intended to stimulate the economy and provide for extensive infrastructure, energy, health and education needs. The failure of these significant legislative measures to help stabilize the financial markets and a continuation or worsening of current financial market conditions could materially and adversely affect our business, financial condition, results of operations, access to credit or the trading price of our Common Shares.

The EESA and the ARRA followed, and have been followed by, numerous actions by the Federal Reserve Board, the United States Congress, the U.S. Treasury, the FDIC, the SEC and others to address the current liquidity and credit crisis that has followed the sub-prime mortgage market meltdown that began in 2007. These measures include homeowner relief that encourages loan restructuring and modification; the establishment of significant liquidity and credit facilities for financial institutions and investment banks; the lowering of the federal funds rate; emergency action against short selling practices; a temporary guaranty program for money market funds; the establishment of a commercial paper funding facility to provide back-stop liquidity to commercial paper issuers; and coordinated international efforts to address illiquidity and other weaknesses in the banking sector. The purpose of these legislative and regulatory actions is to stabilize the United States banking system. The EESA, the ARRA and the other regulatory initiatives described above may not have their desired effects. If the volatility in the markets continues and economic conditions fail to improve or worsen, our business, financial condition and results of operations could be materially and adversely affected.

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Because of our participation in the Capital Purchase Program, we are subject to several restrictions including restrictions on our ability to declare or pay dividends and repurchase our shares as well as restrictions on compensation paid to our executive officers.

Pursuant to the terms of the Securities Purchase Agreement, our ability to declare or pay dividends on any of our shares is limited. Specifically, we are unable to declare or pay dividends on our Common Shares, junior preferred shares or pari passu preferred shares if we are in arrears on the payment of dividends on the Series A Preferred Shares. Further, we are not permitted to increase dividends on our Common Shares above the amount of the last quarterly cash dividend per share declared prior to October 14, 2008 ($0.94 per share) without the U.S. Treasury’s approval until December 23, 2011, unless all of the Series A Preferred Shares have been redeemed or transferred by the U.S. Treasury to unaffiliated third parties. In addition, our ability to repurchase our shares is restricted. The consent of the U.S. Treasury generally is required for us to make any stock repurchase (other than purchases of Series A Preferred Shares or purchases of junior preferred shares or Common Shares in connection with the administration of any employee benefit plan in the ordinary course of business and consistent with past practice) until December 23, 2011, unless all of the Series A Preferred Shares have been redeemed or transferred by the U.S. Treasury to unaffiliated third parties. Further, our Common Shares, junior preferred shares or pari passu preferred shares may not be repurchased if we are in arrears on the payment of Series A Preferred Share dividends.

As a recipient of government funding under the Capital Purchase Program, we must comply with the executive compensation and corporate governance standards imposed by the ARRA for so long as the U.S. Treasury holds any securities acquired from us pursuant to the Securities Purchase Agreement or upon exercise of the Warrant, excluding any period during which the U.S. Treasury holds only the Warrant. These standards include (but are not limited to) (i) ensuring that incentive compensation plans and arrangements for Senior Executive Officers do not encourage unnecessary and excessive risks that threaten Park’s value; (ii) required clawback of any bonus, retention award or incentive compensation paid (or under a legally binding obligation to be paid) to a Senior Executive Officer or any of our 20 next most highly-compensated employees based on materially inaccurate financial statements or other materially inaccurate performance metric criteria; (iii) prohibitions on making golden parachute payments to Senior Executive Officers and our five next most highly-compensated employees, except for payments for services performed or benefits accrued; (iv) prohibitions on paying or accruing any bonus, retention award or incentive compensation with respect to its five most highly-compensated employees or such higher number as the Secretary of the U.S. Treasury may determine is in the public interest, except for grants of restricted stock that do not fully vest during the Covered Period and do not have a value which exceeds one-third of an employee’s total annual compensation; (v) prohibitions on compensation plans that encourage manipulation of reported earnings; (vi) retroactive review of bonuses, retention awards or other compensation that the U.S. Treasury finds to be inconsistent with the purposes of TARP otherwise contrary to the public interest; (vii) required establishment of a company-wide policy regarding “excessive or luxury expenditures”; (viii) inclusion in our proxy statements for annual shareholder meetings of a nonbinding “say on pay” shareholder vote on the compensation of executives; and (ix) agreement not to claim a deduction, for federal income tax purposes, for compensation paid to any of the Senior Executive Officers in excess of $500,000 per year. In particular, the change to the deductibility limit on executive compensation will likely increase the overall cost of our compensation programs in future periods. These standards are more stringent than those currently in effect under the Capital Purchase Program and the Securities Purchase Agreement or those previously proposed by the U.S. Treasury. However, it is still unclear how these standards will relate to the similar standards announced by the U.S. Treasury in the guidelines it issued on February 4, 2009, or whether the standards will be considered effective immediately or only after the U.S. Treasury adopts implementing regulations.

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Future sales of our Common Shares or other securities may dilute the value of our Common Shares, which may adversely affect the market price of our Common Shares or the Series A Preferred Shares.

In many situations, our Board of Directors has the authority, without any vote of our shareholders, to issue shares of our authorized but unissued securities, including Common Shares authorized and unissued under our stock option plans or additional shares of preferred stock. In the future, we may issue additional securities, through public or private offerings, in order to raise additional capital. Any such issuance would dilute the percentage of ownership interest of existing shareholders and may dilute the per share value of the Common Shares or the Series A Preferred Shares.

If we are unable to redeem the Series A Preferred Shares after five years, the cost of this capital to us will increase substantially.

If we are unable to redeem the Series A Preferred Shares prior to February 15, 2014, the cost of this capital to us will increase substantially on that date, from 5.0% per annum to 9.0% per annum. Depending on our financial condition at the time, this increase in the annual dividend rate on the Series A Preferred Shares could have a material negative effect on our liquidity.

The Series A Preferred Shares impact net income available to holders of our Common Shares and earnings per Common Share, and the Warrant we issued to the U.S. Treasury may be dilutive to holders of our Common Shares.

While the additional capital we raised through our participation in the U.S. Treasury’s Capital Purchase Program provides further funding to our business and we believe has improved investor perceptions with regard to our financial position, it has increased our equity and the number of actual and diluted outstanding Common Shares as well as our preferred dividend requirements. The dividends declared and the accretion of discount on the Series A Preferred Shares will reduce the net income available to holders of our Common Shares and our earnings per Common Share. The Series A Preferred Shares will also receive preferential treatment in the event of our liquidation, dissolution or winding up. Additionally, the ownership interest of the existing holders of our Common Shares will be diluted to the extent the Warrant we issued to the U.S. Treasury in conjunction with the sale to the U.S. Treasury of the Series A Preferred Shares is exercised. The Common Shares underlying the Warrant represent approximately 1.60% of our Common Shares outstanding as of February 13, 2009 (including the Common Shares issuable upon exercise of the Warrant in total Common Shares outstanding). Although the U.S. Treasury has agreed not to vote any of the Common Shares it receives upon exercise of the Warrant, a transferee of any portion of the Warrant or of any Common Shares acquired upon exercise of the Warrant is not bound by this restriction.

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We operate in extremely competitive markets, and our business will suffer if we are unable to compete effectively.

In our market areas, we encounter significant competition from other local, regional and national service providers, including banks, savings associations, credit unions and other types of financial institutions, finance companies, insurance agencies and title agencies. Other competitors include securities dealers, brokers, mortgage bankers, investment advisors, insurance companies and financial services subsidiaries of commercial and manufacturing companies. The increasingly competitive environment primarily results from changes in regulation, changes in technology and product delivery systems and the accelerating pace of consolidation among financial service providers. In 2008, the pace of consolidation among financial service providers accelerated considerably, as several major United States financial institutions consolidated, were forced to merge, received substantial government assistance or were placed into conservatorship by the United States Federal Government. These developments could result in our competitors gaining greater capital and other resources, such as a broader range of products and services and geographic diversity. Many of our competitors enjoy the benefits of advanced technology, fewer regulatory constraints and lower cost structures. Many of our new competitors also offer one-stop financial services to their customers that may include services that banks and their subsidiaries may not have been able or legally permitted to offer their customers in the past. Our financial performance and return on investment to shareholders will depend in part on our continued ability to compete successfully in our market areas and on our ability to expand our scope of available financial services as needed to meet the needs and demands of our customers. For more information regarding the competitive environment in which we operate, see the discussion under the caption “Competition” in “Item 1 — Business” of Part I of this Annual Report on Form 10-K.

Changes in the general economic conditions in our primary market areas could adversely impact results of operations and financial condition.

Our lending and deposit gathering activities are concentrated primarily in Ohio and in Gulf Coast communities in Alabama and on the Florida panhandle and our success depends on the general economic conditions of these areas. Adverse changes in the regional and general economic conditions could reduce our growth rate, impair our ability to collect loans, increase loan delinquencies, increase problem assets and foreclosures, increase claims and lawsuits, decrease the demand for our products and services, and decrease the value of collateral for loans, especially real estate, which could have a material adverse effect on our financial condition and results of operations.

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Consumers may decide not to use banks to complete their financial transactions.

Technology and other changes are allowing parties to utilize alternative methods to complete financial transactions that historically have involved banks. For example, consumers can now maintain funds in brokerage accounts or mutual funds that would have historically been held as bank deposits. Consumers can also complete transactions such as paying bills and/or transferring funds directly without the assistance of banks. The process of eliminating banks as intermediaries, known as “disintermediation,” could result in the loss of fee income, as well as the loss of customer deposits and the related income generated from those deposits. The loss of these revenue streams and the lower cost deposits as a source of funds could have a material adverse effect on our financial condition and results of operations.

We have limited operating experience in the Alabama and Florida markets in which Vision Bank operates.

As of the date of this Annual Report on Form 10-K, Park National Bank operated 128 offices across 29 Ohio counties and one county in Northern Kentucky. Vision Bank operated eight offices in one Alabama county and ten offices across six Florida counties. The Vision Merger resulted in the expansion of our banking operations into the Alabama and Florida markets served by Vision Bank. We had no operating experience in the markets served by Vision Bank before the Vision Merger and, therefore, have relied and will continue to rely to a large extent on the existing Board of Directors and management of Vision Bank with respect to its operations. We believe that we can maintain our focus in the Florida and Alabama markets and that the management team of Vision Bank is qualified to carry out our existing Vision Bank strategy.

We may face risks and uncertainties as we convert Park National Bank and its divisions to one operating system.

On July 30, 2007, we announced our intent to consolidate the banking operations of our eight subsidiary banks located in Ohio under one charter — that of Park National Bank, which would remain a national bank. In 2008, the 12 Ohio-based community banking subsidiaries and divisions of Park’s subsidiary banks were merged into the one charter and become divisions of Park National Bank. Since the mergers, each community banking division has retained its local leadership, local decision-making and unique local identity. In connection with the consolidation, we are also implementing a single operating system for the 12 divisions of Park National Bank. We anticipate that a single charter and common operating system will ease complex reporting procedures, reduce time and money spent on duplicated efforts, enhance risk management and strengthen Park National Bank’s ability to provide more rapid responses and high-quality services. As we proceed with the conversion to one operating system, we will face risks and uncertainties which must be addressed. These risks and uncertainties include, but may not be limited to: (i) difficulties we may encounter with respect to product offerings, customer service, customer retention, reporting and enterprise risk management systems and realizing the anticipated operating efficiencies; and (ii) the loss of key employees as we proceed with the consolidation.

The preparation of our financial statements requires the use of estimates that may vary from actual results.

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make significant estimates that affect the financial statements. One of our most critical estimates is the level of the allowance for loan losses. Due to the inherent nature of these estimates, we cannot provide absolute assurance that we will not be required to charge earnings for significant unexpected loan losses. For more information on the sensitivity of these estimates, refer to the discussion of our “Critical Accounting Policies” included in the section of our 2008 Annual Report captioned “FINANCIAL REVIEW” on pages 32 and 33.

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Our allowance for loan losses may prove to be insufficient to absorb potential losses in our loan portfolio.

Lending money is a substantial part of our business. However, every loan we make carries a certain risk of non-payment. This risk is affected by, among other things: cash flow of the borrower and/or the project being financed; in the case of a collateralized loan, the changes and uncertainties as to the future value of the collateral; the credit history of a particular borrower; changes in economic and industry conditions; and the duration of the loan.

We maintain an allowance for loan losses that we believe is a reasonable estimate of known and inherent losses within the loan portfolio. We make various assumptions and judgments about the collectibility of our loan portfolio, including the creditworthiness of our borrowers and the value of the real estate and other assets serving as collateral for the repayment of loans. Through a periodic review and consideration of the loan portfolio, management determines the amount of the allowance for loan losses by considering general market conditions, credit quality of the loan portfolio, the collateral supporting the loans and performance of customers relative to their financial obligations with us. The amount of future losses is susceptible to changes in economic, operating and other conditions, including changes in interest rates, which may be beyond our control, and these losses may exceed current estimates. We cannot fully predict the amount or timing of losses or whether the loss allowance will be adequate in the future. If our assumptions prove to be incorrect, our allowance for loan losses may not be sufficient to cover losses inherent in our loan portfolio, resulting in additions to the allowance. Excessive loan losses and significant additions to our allowance for loan losses could have a material adverse impact on our financial condition and results of operations.

In addition, bank regulators periodically review our allowance for loan losses and may require us to increase our provision for loan losses or recognize further loan charge-offs. Any increase in our allowance for loan losses or loan charge-offs as required by these regulatory authorities might have a material adverse effect on our financial condition and results of operations.

We are exposed to operational risk.

Similar to any large organization, we are exposed to many types of operational risk, including reputational risk, legal and compliance risk, the risk of fraud or theft by employees or outsiders, unauthorized transactions by employees or operational errors, including clerical or record-keeping errors or those resulting from faulty or disabled computer or telecommunications systems.

Negative public opinion can result from our actual or alleged conduct in any number of activities, including lending practices, corporate governance and acquisitions and from actions taken by government regulators and community organizations in response to those activities. Negative public opinion can adversely affect our ability to attract and keep customers and can expose us to potential litigation and regulatory action.

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Given the volume of transactions we process, certain errors may be repeated or compounded before they are discovered and successfully rectified. Our necessary dependence upon automated systems to record and process our transaction volume may further increase the risk that technical system flaws or employee tampering or manipulation of those systems will result in losses that are difficult to detect. We may also be subject to disruptions of our operating systems arising from events that are wholly or partially beyond our control (for example, computer viruses or electrical or telecommunications outages), which may give rise to disruption of service to customers and to financial loss or liability. We are further exposed to the risk that our external vendors may be unable to fulfill their contractual obligations (or will be subject to the same risk of fraud or operational errors by their respective employees as we are) and to the risk that our (or our vendors’) business continuity and data security systems prove to be inadequate.

We depend upon the accuracy and completeness of information about customers and counterparties.

In deciding whether to extend credit or enter into other transactions with customers and counterparties, we may rely on information provided to us by customers and counterparties, including financial statements and other financial information. We may also rely on representations of customers and counterparties as to the accuracy and completeness of that information and, with respect to financial statements, on reports of independent auditors. For example, in deciding whether to extend credit to a business, we may assume that the customer’s audited financial statements conform with GAAP and present fairly, in all material respects, the financial condition, results of operations and cash flows of the customer. We may also rely on the audit report covering those financial statements. Our financial condition and results of operations could be negatively impacted to the extent that we rely on financial statements that do not comply with GAAP or on financial statements and other financial information that are materially misleading.

Legislative or regulatory changes or actions could adversely impact us or the businesses in which we are engaged.

The financial services industry is extensively regulated. We are subject to extensive state and federal regulation, supervision and legislation that govern almost all aspects of our operations. Laws and regulations may change from time to time and are primarily intended for the protection of consumers, depositors, federal deposit insurance funds and the banking system as a whole, and not to benefit our shareholders. The impact of any changes to laws and regulations or other actions by regulatory agencies may negatively impact us or our ability to increase the value of our business. Regulatory authorities have extensive discretion in connection with their supervisory and enforcement activities, including the imposition of restrictions on the operation of an institution, the classification of assets by the institution and the adequacy of an institution’s allowance for loan losses. Additionally, actions by regulatory agencies against us could cause us to devote significant time and resources to defending our business and may lead to penalties that materially affect us and our shareholders.

In light of current conditions in the global financial markets and the global economy, regulators have increased their focus on the regulation of the financial services industry. Most recently, government has intervened on an unprecedented scale in responding to the stresses experienced in the global financial markets. Some of the measures subject us and other institutions for which they were designed to additional restrictions, oversight or costs that may have an impact on our business, results of operations or the price of our Common Shares.

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Proposals for legislation that could substantially intensify the regulation of the financial services industry are expected to be introduced in the United States Congress and in state legislatures. The agencies regulating the financial services industry also frequently adopt changes to their regulations. Substantial regulatory and legislative initiatives, including a comprehensive overhaul of the regulatory system in the United States are possible in the years ahead. We are unable to predict whether any of these initiatives will succeed, which form they will take, or whether any additional changes to statutes or regulations, including the interpretation or implementation thereof, will occur in the future. Any such action could affect us in substantial and unpredictable ways and could have a material adverse effect on our business, financial condition and results of operations. For more information regarding the regulatory environment in which we operate, see the discussion under the caption “Supervision and Regulation of Park and its Subsidiaries” in “Item 1 — Business” of Part I of this Annual Report on Form 10-K.

Changes in accounting standards could impact reported earnings.

The accounting standard setters, including the Financial Accounting Standards Board, the SEC and other regulatory bodies, periodically change the financial accounting and reporting standards that govern the preparation of our consolidated financial statements. These changes can be hard to predict and can materially impact how we record and report our financial condition and results of operations. In some cases, we could be required to apply a new or revised standard retroactively, resulting in the restatement of prior period financial statements.

We may be a defendant from time to time in the future in a variety of litigation and other actions, which could have a material adverse effect on our financial condition and results of operations.

We and our subsidiaries may be involved from time to time in the future in a variety of litigation arising out of our business. Our insurance may not cover all claims that may be asserted against us, and any claims asserted against us, regardless of merit or eventual outcome, may harm our reputation. Should the ultimate judgments or settlements in any litigation exceed our insurance coverage, they could have a material adverse effect on our financial condition and results of operations. In addition, we may not be able to obtain appropriate types or levels of insurance in the future, nor may we be able to obtain adequate replacement policies with acceptable terms, if at all.

Environmental liability associated with commercial lending could have a material adverse effect on our business, financial condition and results of operations.

In the course of our business, we may acquire, through foreclosure, commercial properties securing loans that are in default. There is a risk that hazardous substances could be discovered on those properties. In this event, we could be required to remove the hazardous substances from and remediate the properties at our cost and expense. The cost of removal and environmental remediation could be substantial. We may not have adequate remedies against the owners of the properties or other responsible parties and could find it difficult or impossible to sell the affected properties. These events could have a material adverse effect on our financial condition and results of operations.

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We rely on dividends from our subsidiaries for substantially all of our revenue.

We receive substantially all of our revenue as dividends from our subsidiaries. Federal and state regulations limit the amount of dividends that our subsidiaries may pay to us. In the event our subsidiaries become unable to pay dividends to us, we may not be able to service our debt, pay our other obligations or pay dividends on the Series A Preferred Shares or our Common Shares. Accordingly, our inability to receive dividends from our subsidiaries could also have a material adverse effect on our business, financial condition and results of operations.

Unauthorized disclosure of sensitive or confidential client or customer information, whether through a breach of our computer systems or otherwise, could severely harm our business.

As part of our financial institution business, we collect, process and retain sensitive and confidential client and customer information on behalf of our subsidiaries and other third parties. Despite the security measures we have in place, our facilities and systems, and those of our third-party service providers, may be vulnerable to security breaches, acts of vandalism, computer viruses, misplaced or lost data, programming and/or human errors or other similar events. If information security is breached, information can be lost or misappropriated, resulting in financial loss or costs to us or damages to others. Any security breach involving the misappropriation, loss or other unauthorized disclosure of confidential customer information, whether by us or by our vendors, could severely damage our reputation, expose us to the risks of litigation and liability or disrupt our operations and have a material adverse effect on our business.

Our ability to grow may be limited if we cannot make acquisitions.

As part of an effort to fully deploy our capital and to increase our loans and deposits, we may continue to acquire other financial institutions, financial services companies or branches. We compete with other financial institutions with respect to proposed acquisitions. We cannot predict if or when we will be able to identify and attract acquisition candidates or make acquisitions on favorable terms. In addition, we incur risks and challenges associated with the integration of acquired institutions in a timely and efficient manner, and we cannot guarantee that we will be successful in retaining existing customer relationships or achieving anticipated operating efficiencies.

Derivative transactions may expose us to unexpected risk and potential losses.

We are party to a number of derivative transactions. Many of these derivative instruments are individually negotiated and non-standardized, which can make exiting, transferring or settling the position difficult. We carry borrowings which contain embedded derivatives. These borrowing arrangements require that we deliver underlying securities to the counterparty as collateral. If market interest rates were to decline, we may be required to deliver more securities to the counterparty. We are dependent on the creditworthiness of the counterparties and are therefore susceptible to credit and operational risk in these situations.

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Derivative contracts and other transactions entered into with third parties are not always confirmed by the counterparties on a timely basis. While the transaction remains unconfirmed, we are subject to heightened credit and operational risk and in the event of a default may find it more difficult to enforce the contract. In addition, as new and more complex derivative products are created, covering a wider array of underlying credit and other instruments, disputes about the terms of the underlying contracts could arise, which could impair our ability to effectively manage our risk exposures from these products and subject us to increased costs. Any regulatory effort to create an exchange or trading platform for credit derivatives and other over-the-counter derivative contracts, or a market shift toward standardized derivatives, could reduce the risk associated with such transactions, but under certain circumstances could also limit our ability to develop derivatives that best suit the needs of our clients and ourselves and adversely affect our profitability.

Defaults by another larger financial institution could adversely affect financial markets generally.

The commercial soundness of many financial institutions may be closely interrelated as a result of relationships between the institutions. As a result, concerns about, or a default or threatened default by, one institution could lead to significant market-wide liquidity and credit problems, losses or defaults by other institutions. This is sometimes referred to as “systemic risk” and may adversely affect our business.

Terrorism, acts of war or international conflicts could have a material adverse effect on our financial condition and results of operations.

Acts or threats of war or terrorism, international conflicts, including ongoing military operations in Iraq and Afghanistan, and the actions taken by the United States and other governments in response to such events could negatively impact general business and economic conditions in the United States. If terrorist activity, acts of war or other international hostilities cause an overall economic decline, our financial condition and operating results could be materially adversely affected. The potential for future terrorist attacks, the national and international responses to terrorist attacks or perceived threats to national security and other actual or potential conflicts or acts of war, including conflict in the Middle East, have created many economic and political uncertainties that could seriously harm our business and results of operations in ways that cannot presently be predicted.

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ITEM 1B. UNRESOLVED STAFF COMMENTS.

None.

ITEM 2. PROPERTIES.

Park’s principal executive offices are located at 50 North Third Street, Newark, Ohio 43055.

Park National Bank

As of the date of this Annual Report on Form 10-K, Park National Bank, its divisions and its subsidiary Scope Leasing, Inc. have a total of 128 financial service offices in Ohio and one in Kentucky. Park National Bank has six financial service offices (including its main office) and its operations center in Newark in Licking County. In addition, within Ohio, Park National Bank has:

• financial service offices in Ashland, Loudonville and Perrysville in Ashland County;

• a financial service office in Athens in Athens County;

• a financial service office in West Chester in Butler County;

• financial service offices in Urbana (two offices), Mechanicsburg and North Lewisburg in Champaign County;

• financial service offices in Springfield (six offices), Enon, Medway, New Carlisle (two offices) and South Charleston in Clark County;

• financial service offices in Amelia (two offices), Cincinnati (two offices), Milford (two offices), New Richmond and Owensville in Clermont County

• financial service offices in Coshocton (two offices) in Coshocton County;

• financial service offices in Bucyrus, Crestline and Galion in Crawford County;

• financial service offices in Greenville (five offices), Arcanum (two offices) and Versailles in Darke County;

• financial service offices in Baltimore, Pickerington (two offices) and Lancaster (eight offices) in Fairfield County;

• a financial service office in Jeffersonville in Fayette County;

• financial service offices in Canal Winchester, Columbus, Gahanna and Worthington in Franklin County;

• financial service offices in Jamestown (two offices) and Xenia (two offices) in Greene County;

• a financial service office in Anderson in Hamilton County;

• a financial service office in Logan in Hocking County;

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• financial service offices in Millersburg (two offices) in Holmes County;

• financial service offices in Mount Vernon (3 offices), Centerburg, Danville and Fredericktown in Knox County;

• financial service offices in Granville, Heath (two offices), Hebron, Johnstown, Kirkersville, Pataskala, Reynoldsburg (two offices) and Utica in Licking County;

• a financial service office in Plain City in Madison County.

• financial service offices in Caledonia, Marion (two offices), Prospect and Waldo in Marion County;

• a financial service office in Fort Recovery in Mercer County;

• financial service offices in Piqua (three offices), Tipp City and Troy (two offices) in Miami County;

• a financial service office in Dayton in Montgomery County;

• financial service offices in Mount Gilead (two offices) in Morrow County;

• financial service offices in Zanesville (seven offices), New Concord and Dresden in Muskingum County;

• a financial service office in New Lexington in Perry County;

• financial service offices in Bellville, Mansfield (eight offices), Butler, Lexington, Ontario and Shelby in Richland County;

• a financial service office in Newcomerstown in Tuscarawas County; and

• a financial service office in Springboro in Warren County.

Park National Bank also has one financial service office in Florence (Boone County), Kentucky.

The financial service offices in Athens, Coshocton, Hocking, Muskingum, Perry and Tuscarawas Counties comprise the Century National Bank division. The financial service offices in Champaign and Madison Counties comprise the Citizens National Bank division. The financial service offices in Canal Winchester and Fairfield County comprise the Fairfield National Bank Division. The financial service offices in Ashland County comprise the Farmer and Savings Bank division. The financial service offices in Bellville in Richland County and in Holmes, Knox and Morrow Counties comprise the First-Knox National Bank division. The financial service offices in Butler, Clermont, Hamilton, Montgomery and Warren Counties in Ohio and in Boone County, Kentucky comprise The Park National Bank of Southwest Ohio & Northern Kentucky division. The financial service offices in Richland County (except the Bellville office) comprise the Richland Bank division. The financial service offices in Darke and Mercer Counties comprise the Second National Bank division. The financial service offices in Clark, Fayette and Greene Counties comprise the Security National Bank division. The financial service offices in Crawford and Marion Counties comprise the United Bank division. The financial service offices in Miami County comprise the Unity National Bank division. Of the financial service offices described above, 36 are leased and the remainder are owned. Park National Bank also operates 35 off-site automated teller machines.

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Scope Leasing, Inc. has an office located in Columbus in Franklin County, Ohio.

Guardian Finance

As of the date of this Annual Report on Form 10-K, Guardian Finance has a total of six financial service offices, all of which are located in Ohio. Guardian Finance has its main office in Hilliard in Franklin County, a financial service office in Springfield in Clark County, a financial service office in Lancaster in Fairfield County where it leases space from the Fairfield National Bank division of Park National Bank, a financial service office in Heath in Licking County, a financial service office in Centerville in Montgomery County and a financial service office in Mansfield in Richland County where it leases space from the Richland Bank division of Park National Bank. All of Guardian Finance’s financial service offices are leased.

Vision Bank

As of the date of this Annual Report on Form 10-K, Vision Bank has a total of 18 financial service offices. Vision Bank has ten financial service offices in Florida, including:

• its main office in Panama City and two financial service offices in Panama City Beach in Bay County;

• financial service offices in Port St. Joe, Port St. Joe Beach and Wewahitchka in Gulf County;

• a loan production office in Tallahassee in Leon County;

• a financial service office in Destin in Okaloosa County;

• a financial service office in Navarre in Santa Rosa County; and

• a financial service office in Santa Rosa Beach in Walton County.

Vision Bank has eight financial service offices in Alabama, one each in Daphne, Elberta, Fairhope, Foley, Gulf Shores, Orange Beach, Point Clear and Robertsdale in Baldwin County and one messenger office in Gulf Shores in Baldwin County, Alabama. Of Vision Bank’s 18 financial service offices, 10 are leased and the remainder are owned. Vision Bank also operates 5 off-site automatic teller machines.

ITEM 3. LEGAL PROCEEDINGS.

There are no pending legal proceedings to which Park or any of its subsidiaries is a party or to which any of their property is subject, except for routine legal proceedings to which Park’s subsidiary banks are parties incidental to their respective banking businesses. Park considers none of those proceedings to be material.

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ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

At the Special Meeting of Shareholders (the “Special Meeting”) of Park held on December 18, 2008, Park’s shareholders adopted an amendment to Article FOURTH of Park’s Articles of Incorporation to authorize Park to issue up to 200,000 preferred shares, each without par value. Park was not previously authorized to issue preferred shares under its Articles of Incorporation.

At the close of business on November 6, 2008, the record date for the Special Meeting, there were 13,964,533 Common Shares outstanding and entitled to vote.

With respect to the proposal to adopt the amendment to Article FOURTH of Park’s Articles of Incorporation to authorize Park to issue up to 200,000 preferred shares, the vote was as follows:

For	Against	Abstain	Broker Non-Votes
10,968,056	743,266	31,142	N/A

With respect to the proposal to approve the adjournment of the Special Meeting, if necessary, to solicit additional proxies in the event there were not sufficient votes at the time of the Special Meeting to adopt the proposed amendment to Article FOURTH of Park’s Articles of Incorporation, the vote was as follows:

For	Against	Abstain	Broker Non-Votes
10,910,583	798,391	33,490	N/A

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

The information called for in this Item 5 by Items 201(a) through (c) of SEC Regulation S-K is incorporated herein by reference from “Table 14 – Market and Dividend Information” and the accompanying disclosure in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on page 45.

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The following table provides information regarding purchases of Park’s Common Shares made by or on behalf of Park or any “affiliated purchaser” of Park, as defined in Rule 10b-18(a)(3) under the Securities Exchange Act of 1934, as amended, during the fiscal quarter ended December 31, 2008, as well as information concerning changes in the maximum number of Common Shares that may be purchased under Park’s previously announced repurchase programs as a result of the forfeiture of previously outstanding incentive stock options.

							Maximum
					Total Number of		Number of
					Common Shares		Common Shares
					Purchased as Part		that May Yet Be
	Total Number of		Average Price		of Publicly		Purchased under
	Common Shares		Paid per		Announced Plans		the Plans or
Period	Purchased		Common Share		or Programs		Programs (1)
October 1 through October 31, 2008		—		—		—		1,672,255
November 1 through November 30, 2008		—		—		—		1,672,255
December 1 through December 31, 2008		—		—		—		1,656,639
Total		—		—		—		1,656,639

(1) The number shown represents, as of the end of each period, the maximum aggregate number of Common Shares that may yet be purchased under Park’s publicly announced stock repurchase authorization to fund the Park National Corporation 2005 and 1995 Incentive Stock Option Plans as well as Park’s publicly announced stock repurchase program.

On July 16, 2007, Park announced that its Board of Directors had authorized management to purchase up to an aggregate of 1,000,000 additional Common Shares over the three-year period ending July 15, 2010 in open market purchases or through privately negotiated transactions, to be held as treasury shares for general corporate purposes. During 2008, Park did not purchase any Common Shares under this authorization. At December 31, 2008, an aggregate of 992,174 Common Shares remained authorized for repurchase under this stock repurchase authorization.

The Park National Corporation 2005 Incentive Stock Option Plan (the “2005 Plan”) was adopted by the Board of Directors of Park on January 18, 2005 and was approved by the Park shareholders at the Annual Meeting of Shareholders on April 18, 2005. Under the 2005 Plan, 1,500,000 Common Shares are authorized for delivery upon the exercise of incentive stock options granted under the 2005 Plan. All of the Common Shares delivered upon the exercise of incentive stock options granted under the 2005 Plan are to be treasury shares. During 2008, Park did not purchase any Common Shares to be held as treasury shares and delivered upon exercise of incentive stock options granted under the 2005 Plan. As of December 31, 2008, incentive stock options covering 279,273 Common Shares were outstanding and 1,220,727 Common Shares were available for future grants under the 2005 Plan.

The Park National Corporation 1995 Incentive Stock Option Plan (as amended, the “1995 Plan”) was adopted April 17, 1995, and amended April 20, 1998 and April 16, 2001. Pursuant to the terms of the 1995 Plan, all of the Common Shares delivered upon exercise of incentive stock options granted under the 1995 Plan are to be treasury shares. No further incentive stock options may be granted under the 1995 Plan. As of December 31, 2008, incentive stock options covering 172,415 Common Shares were outstanding under the 1995 Plan.

Incentive stock options, granted under both the 2005 Plan and the 1995 Plan, covering 451,688 Common Shares were outstanding as of December 31, 2008 and 1,220,727 Common Shares were available for future grants under the 2005 Plan. With 1,007,950 Common Shares held as treasury shares for purposes of the 2005 Plan and the 1995 Plan at December 31, 2008, an additional 664,465 Common Shares remained authorized for repurchase for purposes of funding the 2005 Plan and the 1995 Plan.

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ITEM 6. SELECTED FINANCIAL DATA.

The information called for in this Item 6 is incorporated herein by reference from “Table 12 – Consolidated Five-Year Selected Financial Data” and the accompanying disclosure in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on page 44.

ITEM 7.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The information called for in this Item 7 is incorporated herein by reference from the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on pages 30 through 45.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As noted in Note 21 of the Notes to Consolidated Financial Statements under the caption “Fair Values” on pages 67 and 68 of Park’s 2008 Annual Report, Park and its subsidiaries did not have any derivative financial instruments in 2007. However, on January 2, 2008, Park entered into a “pay fixed-receive floating” interest rate swap agreement for a notional amount of $25 million, which matures on December 28, 2012. This interest rate swap agreement was designed as a cash flow hedge against the variability of cash flows related to the Subordinated Debenture in the principal amount of $25,000,000 issued by Park National Bank on December 28, 2007. The discussion of this interest rate swap agreement included in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW – SOURCE OF FUNDS – Subordinated Debentures” on page 34, in Note 19 of the Notes to Consolidated Financial Statements located on pages 66 and 67 of Park’s 2008 Annual Report and in Note 21 of the Notes to Consolidated Financial Statements located on pages 67 and 68 of Park’s 2008 Annual Report is incorporated herein by reference. The discussion of interest rate sensitivity included in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW – CAPITAL RESOURCES – Liquidity and Interest Rate Sensitivity Management,” on pages 41 and 42, is incorporated herein by reference. In addition, the discussion of Park’s commitments, contingent liabilities and off-balance sheet arrangements included on page 42 of Park’s 2008 Annual Report under the caption “FINANCIAL REVIEW – CONTRACTUAL OBLIGATIONS – Commitments, Contingent Liabilities, and Off-Balance Sheet Arrangements,” and in Note 18 of the Notes to Consolidated Financial Statements included on page 66 of Park’s 2008 Annual Report, is incorporated herein by reference.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The Consolidated Balance Sheets of Park and its subsidiaries at December 31, 2008 and 2007, the related Consolidated Statements of Income, of Changes in Stockholders’ Equity and of Cash Flows for the years ended December 31, 2008, 2007 and 2006, the related Notes to Consolidated Financial Statements and the Report of Independent Registered Public Accounting Firm (Crowe Horwath LLP) appearing on pages 47 through 71 of Park’s 2008 Annual Report, are incorporated herein by reference. Quarterly Financial Data provided in “Table 13 – Quarterly Financial Data” and the accompanying disclosure included in the section of Park’s 2008 Annual Report captioned “FINANCIAL REVIEW,” on pages 44 and 45, is also incorporated herein by reference.

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ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

No response required.

ITEM 9A. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

With the participation of the Chairman of the Board and Chief Executive Officer (the principal executive officer) and the Chief Financial Officer (the principal financial officer) of Park, Park’s management has evaluated the effectiveness of Park’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the fiscal year covered by this Annual Report on Form 10-K. Based on that evaluation, Park’s Chairman of the Board and Chief Executive Officer and Park’s Chief Financial Officer have concluded that:

• information required to be disclosed by Park in this Annual Report on Form 10-K and the other reports that Park files or submits under the Exchange Act would be accumulated and communicated to Park’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure;

• information required to be disclosed by Park in this Annual Report on Form 10-K and the other reports that Park files or submits under the Exchange Act would be recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms; and

• Park’s disclosure controls and procedures were effective as of the end of the fiscal year covered by this Annual Report on Form 10-K.

Management’s Annual Report on Internal Control over Financial Reporting

The “MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING” on page 46 of Park’s 2008 Annual Report is incorporated herein by reference.

Attestation Report of the Registered Public Accounting Firm

The “REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM” on page 47 of Park’s 2008 Annual Report is incorporated herein by reference.

Changes in Internal Control over Financial Reporting

There were no changes in Park’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during Park’s fiscal quarter ended December 31, 2008, that have materially affected, or are reasonably likely to materially affect, Park’s internal control over financial reporting.

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ITEM 9B. OTHER INFORMATION.

No response required.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Directors, Executive Officers and Persons Nominated or Chosen to Become Directors or Executive Officers

The information required by Item 401 of SEC Regulation S-K concerning the directors of Park and the nominees for re-election as directors of Park at the Annual Meeting of Shareholders to be held on April 20, 2009 (the “2009 Annual Meeting”) is incorporated herein by reference from the disclosure to be included under the caption “PROPOSAL 1 – ELECTION OF DIRECTORS” in Park’s definitive Proxy Statement relating to the 2009 Annual Meeting to be filed pursuant to SEC Regulation 14A (“Park’s 2009 Proxy Statement”).

The information required by Item 401 of SEC Regulation S-K concerning the executive officers of Park is incorporated herein by reference from the disclosure to be included under the caption “EXECUTIVE OFFICERS” in Park’s 2009 Proxy Statement.

Compliance with Section 16(a) of the Exchange Act

The information required by Item 405 of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “BENEFICIAL OWNERSHIP OF PARK COMMON SHARES – Section 16(a) Beneficial Ownership Reporting Compliance” in Park’s 2009 Proxy Statement.

Committee Charters; Code of Business Conduct and Ethics

Park’s Board of Directors has adopted charters for each of the Audit Committee, the Compensation Committee, the Nominating Committee and the Risk Committee.

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In accordance with the requirements of Section 807 of the NYSE Alternext US Company Guide, the Board of Directors of Park has adopted a Code of Business Conduct and Ethics covering the directors, officers and employees of Park and its affiliates, including Park’s Chairman of the Board and Chief Executive Officer (the principal executive officer), Park’s President and Secretary, Park’s Chief Financial Officer (the principal financial officer) and Park’s Chief Accounting Officer (the principal accounting officer). Park intends to disclose the following events, if they occur, in a current report on Form 8-K within four business days following their occurrence: (A) the date and nature of any amendment to a provision of Park’s Code of Business Conduct and Ethics that (i) applies to Park’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, (ii) relates to any element of the code of ethics definition enumerated in Item 406(b) of SEC Regulation S-K, and (iii) is not a technical, administrative or other non-substantive amendment; and (B) a description of any waiver (including the nature of the waiver, the name of the person to whom the waiver was granted and the date of the waiver), including an implicit waiver, from a provision of the Code of Business Conduct and Ethics granted to Park’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions that relates to one or more of the elements of the code of ethics definition set forth in Item 406(b) of SEC Regulation S-K. In addition, Park will disclose any waivers from the provisions of the Code of Business Conduct and Ethics granted to a director or executive officer of Park in a current report on Form 8-K within four business days following their occurrence.

The text of each of the Code of Business Conduct and Ethics, the Audit Committee Charter, the Compensation Committee Charter, the Nominating Committee Charter and the Risk Committee Charter is posted on the “Governance Documents” section of the “Investor Relations” page of Park’s Internet website located at www.parknationalcorp.com. Interested persons may also obtain copies of the Code of Business Conduct and Ethics, the Audit Committee Charter, the Compensation Committee Charter, the Nominating Committee Charter and the Risk Committee Charter, without charge, by writing to the President of Park at Park National Corporation, 50 North Third Street, P.O. Box 3500, Newark, Ohio 43058-3500, Attention: David L. Trautman.

Procedures for Recommending Director Nominees

Information concerning the procedures by which shareholders of Park may recommend nominees to Park’s Board of Directors is incorporated herein by reference from the disclosure to be included under the caption “CORPORATE GOVERNANCE – Nominating Procedures” in Park’s 2009 Proxy Statement. These procedures have not materially changed from those described in Park’s definitive Proxy Statement for the 2008 Annual Meeting of Shareholder held on April 21, 2008.

Audit Committee

The information required by Items 407(d)(4) and 407(d)(5) of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “BOARD OF DIRECTORS MEETINGS AND COMMITTEES OF THE BOARD – Committees of the Board – Audit Committee” in Park’s 2009 Proxy Statement.

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ITEM 11. EXECUTIVE COMPENSATION.

The information required by Item 402 of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the captions “EXECUTIVE COMPENSATION” and “DIRECTOR COMPENSATION” in Park’s 2009 Proxy Statement.

The information required by Item 407(e)(4) of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION” in Park’s 2009 Proxy Statement.

The information required by Item 407(e)(5) of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “EXECUTIVE COMPENSATION – Compensation Committee Report” in Park’s 2009 Proxy Statement.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

Beneficial Ownership of Common Shares of Park

The information required by Item 403 of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “BENEFICIAL OWNERSHIP OF PARK COMMON SHARES” in Park’s 2009 Proxy Statement.

Equity Compensation Plan Information

Park has three compensation plans (excluding plans assumed by Park in the merger with Security Banc Corporation effective March 23, 2001 (the “Assumed Security Plans”)) under which Common Shares of Park are authorized for issuance to directors, officers or employees of Park and Park’s subsidiaries in exchange for consideration in the form of goods or services – the Park National Corporation 1995 Incentive Stock Option Plan (as amended, the “1995 Plan”), the Park National Corporation 2005 Incentive Stock Option Plan (the “2005 Plan”) and the Park National Corporation Stock Plan for Non-Employee Directors of Park National Corporation and Subsidiaries (the “Directors’ Stock Plan”). In addition, Park maintains the Park National Corporation Employees Stock Ownership Plan (the “Park KSOP”), which is intended to meet the qualification requirements of Section 401(a) of the Internal Revenue Code of 1986, as amended. The 1995 Plan (and amendments thereto), the 2005 Plan and the Directors’ Stock Plan have been approved by Park’s shareholders.

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The following table shows the number of Common Shares issuable upon exercise of incentive stock options (“ISOs”) granted under the 1995 Plan and the 2005 Plan outstanding at December 31, 2008, the weighted-average exercise price of those ISOs and the number of Common Shares remaining available for future issuance under the 2005 Plan and the Directors’ Stock Plan at December 31, 2008, excluding Common Shares issuable upon exercise of outstanding ISOs granted under the 2005 Plan. No further ISOs may be granted under the 1995 Plan. The table does not include Common Shares subject to outstanding options granted under the Assumed Security Plans. Footnote (2) to the table sets forth the total number of Common Shares issuable upon exercise of options granted under the Assumed Security Plans which were outstanding at December 31, 2008, and the weighted-average exercise price of those options. Park cannot grant additional options under the Assumed Security Plans.

							Number of common
							shares remaining
							available for future
	Number of common						issuance under equity
	shares to be issued			Weighted-average			compensation plans
	upon exercise of			exercise price of			(excluding common
	outstanding options,			outstanding options,			shares reflected in
	warrants and rights			warrants and rights			column (a))
Plan category	(a)			(b)			(c)
Equity compensation plans approved by shareholders		451,668		$	102.30			1,288,147	(1)
Equity compensation plans not approved by shareholders			(2)			(2)			(2)
Total		451,688		$	102.30			1,288,147	(1)

(1)

Includes 1,220,727 Common Shares remaining available for future issuance under the 2005 Plan and 67,420 Common Shares remaining available for future issuance under the Directors’ Stock Plan.

(2)

The table does not include information for the Assumed Security Plans. A total of 731 Common Shares were issuable upon exercise of options granted under Assumed Security Plans which were outstanding at December 31, 2008. The weighted-average exercise price of all options granted under the Assumed Security Plans which were outstanding at December 31, 2008, was $115.73. Park cannot grant additional options under the Assumed Security Plans.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

Certain Relationships and Related Party Transactions

The information required by Item 404 of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the captions “CORPORATE GOVERNANCE – Transactions with Related Persons” and “COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION” in Park’s 2009 Proxy Statement.

Director Independence

The information required by Item 407(a) of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “CORPORATE GOVERNANCE – Independence of Directors” in Park’s 2009 Proxy Statement.

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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

The information called for in this Item 14 is incorporated herein by reference from the disclosure to be included under the captions “AUDIT COMMITTEE MATTERS – Pre-Approval of Services Performed by Independent Registered Public Accounting Firm” and “AUDIT COMMITTEE MATTERS – Fees of Independent Registered Public Accounting Firm” in Park’s 2009 Proxy Statement.

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a)(1) Financial Statements.

The consolidated financial statements (and report thereon) listed below are incorporated herein by reference from Park’s 2008 Annual Report as noted:

Report of Independent Registered Public Accounting Firm (Crowe Horwath LLP) — Incorporated by reference from page 47 of Park’s 2008 Annual Report

Consolidated Balance Sheets at December 31, 2008 and 2007 — Incorporated by reference from pages 48 and 49 of Park’s 2008 Annual Report

Consolidated Statements of Income for the years ended December 31, 2008, 2007 and 2006 — Incorporated by reference from pages 50 and 51 of Park’s 2008 Annual Report

Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 31, 2008, 2007 and 2006 — Incorporated by reference from page 52 of Park’s 2008 Annual Report

Consolidated Statements of Cash Flows for the years ended December 31, 2008, 2007 and 2006 — Incorporated by reference from page 53 of Park’s 2008 Annual Report

Notes to Consolidated Financial Statements — Incorporated by reference from pages 54 through 71 of Park’s 2008 Annual Report

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(a)(2) Financial Statement Schedules.

All schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions or are inapplicable and have been omitted.

(a)(3) Exhibits.

The documents listed below are filed with this Annual Report on Form 10-K as exhibits or incorporated into this Annual Report on Form 10-K by reference as noted:

Exhibit No.			Description of Exhibit
	2.1	(a)	Agreement and Plan of Merger, dated to be effective as of September 14, 2006, by and between Park National Corporation and Vision Bancshares, Inc. (the “Vision Bancshares Merger Agreement”)* (incorporated herein by reference to Annex A to the Prospectus of Park National Corporation/Proxy Statement of Vision Bancshares, Inc. dated January 9, 2007, filed on January 11, 2007 pursuant to Rule 424(b)(3) under the Securities Act of 1933 (Registration No. 333-139083))
	2.1	(b)	First Amendment to Agreement and Plan of Merger, dated to be effective as of February 6, 2007, by and between Park National Corporation and Vision Bancshares, Inc. (incorporated herein by reference to Exhibit 2.1(b) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 (File No. 1-13006) (“Park’s 2006 Form 10-K”))
	2.2		Plan of Merger and Merger Agreement between Vision Bank (an Alabama state-chartered bank with its main office located in Gulf Shores, Alabama) and Vision Bank (a Florida state-chartered bank with its main office located in Panama City, Florida), dated July 10, 2007 (incorporated herein by reference to Exhibit 2.1 to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2007 (File No. 1-13006))
	2.3		Agreement to Merge, entered into as of May 21, 2008, by and between (a) each of (i) The Richland Trust Company, (ii) Century National Bank, (iii) The First-Knox National Bank of Mount Vernon, (iv) United Bank, National Association (also referred to as United Bank, N.A.), (v) Second National Bank, (vi) The Security National Bank and Trust Co. and (vii) The Citizens National Bank of Urbana; and (b) The Park National Bank (incorporated herein by reference to Exhibit 2.1 to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2008 (File No. 1-13006))
	2.4		Credit Card Account Purchase Agreement by and between U.S. Bank National Association ND, d/b/a Elan Financial Services and The Park National Bank (also known as Park National Bank), executed on October 10, 2008 with an effective date of September 30, 2008** (incorporated herein by reference to Exhibit 2.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on October 14, 2008 (File No. 1-13006))

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Exhibit No.			Description of Exhibit
	3.1	(a)	Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on March 24, 1992 (incorporated herein by reference to Exhibit 3(a) to Park National Corporation’s Form 8-B, filed on May 20, 1992 (File No. 0-18772) (“Park’s Form 8-B”))
	3.1	(b)	Certificate of Amendment to the Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on May 6, 1993 (incorporated herein by reference to Exhibit 3(b) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 1993 (File No. 0-18772))
	3.1	(c)	Certificate of Amendment to the Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on April 16, 1996 (incorporated herein by reference to Exhibit 3(a) to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1996 (File No. 1-13006))
	3.1	(d)	Certificate of Amendment by Shareholders to the Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on April 22, 1997 (incorporated herein by reference to Exhibit 3(a)(1) to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1997 (File No. 1-13006) (“Park’s June 30, 1997 Form 10-Q”))
	3.1	(e)	Certificate of Amendment by Shareholders or Members as filed with the Secretary of State of the State of Ohio on December 18, 2008 in order to evidence the adoption by the shareholders of Park National Corporation on December 18, 2008 of an amendment to Article FOURTH of Park National Corporation’s Articles of Incorporation to authorize Park National Corporation to issue up to 200,000 preferred shares, without par value (incorporated herein by reference to Exhibit 3.1 to Park National Corporation’s Current Report on Form 8-K dated and filed December 19, 2008 (File No. 1-13006))
	3.1	(f)	Certificate of Amendment by Directors or Incorporators to Articles as filed with the Secretary of State of the State of Ohio on December 19, 2008, evidencing adoption of amendment by Board of Directors of Park National Corporation to Article FOURTH of Articles of Incorporation to establish express terms of Fixed Rate Cumulative Perpetual Preferred Shares, Series A, each without par value, of Park National Corporation (incorporated herein by reference to Exhibit 3.1 to Park National Corporation’s Current Report on Form 8-K dated and filed December 23, 2008 (File No. 1-13006) (“Park’s December 23, 2008 Form 8-K”))
	3.1	(g)	Articles of Incorporation of Park National Corporation (reflecting amendments through December 19, 2008) [for SEC reporting compliance purposes only – not filed with Ohio Secretary of State] (filed herewith)
	3.2	(a)	Regulations of Park National Corporation (incorporated herein by reference to Exhibit 3(b) to Park’s Form 8-B)

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Exhibit No.			Description of Exhibit
	3.2	(b)	Certified Resolution regarding Adoption of Amendment to Subsection 2.02(A) of the Regulations of Park National Corporation by Shareholders on April 21, 1997 (incorporated herein by reference to Exhibit 3(b)(1) to Park’s June 30, 1997 Form 10-Q)
	3.2	(c)	Certificate Regarding Adoption of Amendments to Sections 1.04 and 1.11 of Park National Corporation’s Regulations by the Shareholders on April 17, 2006 (incorporated herein by reference to Exhibit 3.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on April 18, 2006 (File No. 1-13006))
	3.2	(d)	Certificate Regarding Adoption by the Shareholders of Park National Corporation on April 21, 2008 of Amendment to Regulations to Add New Section 5.10 to Article FIVE (incorporated herein by reference to Exhibit 3.2(d) to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2008 (“Park’s March 31, 2008 Form 10-Q”) (File No. 1-13006))
	3.2	(e)	Regulations of Park National Corporation (reflecting amendments through April 21, 2008) [For purposes of SEC reporting compliance only] (incorporated herein by reference to Exhibit 3.2 (e) to Park’s March 31, 2008 Form 10-Q)
	4.1	(a)	Junior Subordinated Indenture, dated as of December 5, 2005, between Vision Bancshares, Inc. and Wilmington Trust Company, as Trustee (incorporated herein by reference to Exhibit 10.16 to Vision Bancshares, Inc.’s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 (File No. 000-50719))
	4.1	(b)	First Supplemental Indenture, dated to be effective as of 6:00 p.m., Eastern Standard Time, on March 9, 2007, among Wilmington Trust Company, as Trustee; Park National Corporation; and Vision Bancshares, Inc. (incorporated herein by reference to Exhibit 4.1(b) to Park National Corporation’s Current Report on Form 8-K dated and filed March 15, 2007 (File No. 1-13006) (“Park’s March 15, 2007 Form 8-K”))
	4.2	(a)	Amended and Restated Trust Agreement, dated as of December 5, 2005, among Vision Bancshares, Inc., as Depositor; Wilmington Trust Company, as Property Trustee and as Delaware Trustee; and the Administrative Trustees named therein, in respect of Vision Bancshares Trust I (incorporated herein by reference to Exhibit 10.15 to Vision Bancshares, Inc.’s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 (File No. 000-50719))
			Note: Pursuant to the First Supplemental Indenture, dated to be effective as of 6:00 p.m., Eastern Standard Time, on March 9, 2007, among Wilmington Trust Company, as Trustee; Park National Corporation; and Vision Bancshares, Inc., Park National Corporation succeeded to and was substituted for Vision Bancshares, Inc. as “Depositor”
	4.2	(b)	Notice of Resignation of Administrative Trustees and Appointment of Successors, dated March 9, 2007, delivered to Wilmington Trust Company by the Resigning Administrative Trustees named therein, the Successor Administrative Trustees named therein and Park National Corporation (incorporated herein by reference to Exhibit 4.2(b) to Park’s March 15, 2007 Form 8-K)

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Exhibit No.			Description of Exhibit
	4.3		Guarantee Agreement, dated as of December 5, 2005, between Vision Bancshares, Inc., as Guarantor, and Wilmington Trust Company, as Guarantee Trustee, in respect of Vision Bancshares Trust I (incorporated herein by reference to Exhibit 10.17 to Vision Bancshares, Inc.’s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 (File No. 000-50719))
			Note: Pursuant to the First Supplemental Indenture, dated to be effective as of 6:00 p.m., Eastern Standard Time, on March 9, 2007, among Wilmington Trust Company, as Trustee; Park National Corporation; and Vision Bancshares, Inc., Park National Corporation succeeded to and was substituted for Vision Bancshares, Inc. as “Guarantor”
	4.4		Subordinated Debenture, dated December 28, 2007, in the principal amount of $25,000,000, issued by The Park National Bank to USB Capital Funding Corp. (incorporated herein by reference to Park National Corporation’s Current Report on Form 8-K dated and filed on January 2, 2008 (“Park’s January 2, 2008 Form 8-K”))
	4.5		Warrant to Purchase 227,376 Shares of Common Stock (Common Shares) of Park National Corporation issued to the United States Department of the Treasury on December 23, 2008 (incorporated herein by reference to Exhibit 4.1 to Park’s December 23, 2008 Form 8-K)
	4.6		Letter Agreement, dated December 23, 2008, including Securities Purchase Agreement – Standard Terms attached thereto as Exhibit A, between Park National Corporation and the United States Department of the Treasury (incorporated herein by reference to Exhibit 10.1 to Park’s December 23, 2008 Form 8-K) [NOTE: Annex A to Securities Purchase Agreement is not included therewith; filed as Exhibit 3.1 to Park’s December 23, 2008 Form 8-K and incorporated by reference at Exhibit 3.1(f) of this Annual Report on Form 10-K]
	4.7		Agreement to furnish instruments and agreements defining rights of holders of long-term debt (filed herewith)
	10.1	†	Summary of Base Salaries for Executive Officers of Park National Corporation (filed herewith)
	10.2	†	Summary of Incentive Compensation Plan of Park National Corporation for the twelve-month period ended September 30, 2008 (filed herewith)
	10.3	(a)†	Split-Dollar Agreement, dated May 17, 1993, between William T. McConnell and The Park National Bank (incorporated herein by reference to Exhibit 10(f) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 1993 (File No. 0-18772))

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Exhibit No.			Description of Exhibit
	10.3	(b)†	Schedule identifying Split-Dollar Agreements covering executive officers or employees of The Park National Bank or one of its divisions who are also directors or executive officers of Park National Corporation, which Split-Dollar Agreements are identical to the Split-Dollar Agreement, dated May 17, 1993, between William T. McConnell and The Park National Bank (filed herewith)
	10.4	†	Park National Corporation 1995 Incentive Stock Option Plan (reflects amendments and share dividends through December 15, 2004) (incorporated herein by reference to Exhibit 10.5 to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 2004 (File No. 1-13006) (“Park’s 2004 Form 10-K”))
	10.5	†	Form of Stock Option Agreement executed in connection with the grant of options under the Park National Corporation 1995 Incentive Stock Option Plan, as amended (incorporated herein by reference to Exhibit 10(i) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 1998 (File No. 1-13006))
	10.6	(a)†	Description of Park National Corporation Supplemental Executive Retirement Benefits as in effect during fiscal year ended December 31, 2007 and until February 18, 2008 (incorporated herein by reference to Exhibit 10.6(a) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007 (File No. 1-13006))
	10.6	(b)†	Form of Supplemental Executive Retirement Plan Agreement entered into by and between Park National Corporation or a wholly-owned subsidiary of Park National Corporation and each of C. Daniel DeLawder, John W. Kozak and William T. McConnell on December 27, 1996 (incorporated herein by reference to Exhibit 10.7(b) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 (File No. 1-13006))
	10.7	(a)†	Description of Park National Corporation Supplemental Executive Retirement Benefits as in effect from and after February 18, 2008 (filed herewith)
	10.7	(b)†	Supplemental Executive Retirement Benefits Agreement, made as of February 18, 2008, between Park National Corporation and David L. Trautman (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed February 19, 2008 (File No. 1-13006)(“Park’s February 19, 2008 Form 8-K”))
	10.7	(c)†	Form of Amended and Restated Supplemental Executive Retirement Benefits Agreement, made as of February 18, 2008, between Park National Corporation and each of C. Daniel DeLawder, John W. Kozak and William T. McConnell (incorporated herein by reference to Exhibit 10.2 to Park’s February 19, 2008 Form 8-K)
	10.8	†	Security Banc Corporation 1998 Stock Option Plan, which was assumed by Park National Corporation (incorporated herein by reference to Exhibit 10(c) to Park National Corporation’s Registration Statement on Form S-8 filed April 23, 2001 (Registration No. 333-59378))

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Exhibit No.			Description of Exhibit
	10.9	†	Employment Agreement, made and entered into as of December 22, 1999, and the Amendment thereto, dated March 23, 2001, between The Security National Bank and Trust Co. (also known as Security National Bank and Trust Co.) and Harry O. Egger (incorporated herein by reference to Exhibit 10(e) to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2001 (File No. 1-13006))
	10.10	†	Park National Corporation Stock Plan for Non-Employee Directors of Park National Corporation and Subsidiaries (incorporated herein by reference to Exhibit 10 to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2004 (File No. 1-13006))
	10.11	†	Summary of Certain Compensation for Directors of Park National Corporation (filed herewith)
	10.12	†	Security National Bank and Trust Co. Second Amended and Restated 1988 Deferred Compensation Plan (filed herewith)
	10.13	†	Park National Corporation 2005 Incentive Stock Option Plan (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on April 20, 2005 (File No. 1-13006) (“Park’s April 20, 2005 Form 8-K”))
	10.14	†	Form of Stock Option Agreement to be used in connection with the grant of incentive stock options under the Park National Corporation 2005 Incentive Stock Option Plan (incorporated herein by reference to Exhibit 10.2 to Park’s April 20, 2005 Form 8-K)
	10.15	(a)	Credit Agreement, dated as of March 12, 2007, between JPMorgan Chase Bank, N.A. and Park National Corporation (incorporated herein by reference to Exhibit 10.1(a) to Park’s March 15, 2007 Form 8-K)
	10.15	(b)	Amendment to Credit Agreement, dated as of January 10, 2008, between Park National Corporation and JPMorgan Chase Bank, N.A. (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on January 11, 2008 (File No. 1-13006) (“Park’s January 11, 2008 Form 8-K”))
	10.15	(c)	Line of Credit Note, dated January 10, 2008, issued by Park National Corporation to JPMorgan Chase Bank, N.A. or order (incorporated herein by reference to Exhibit 10.2 to Park’s January 11, 2008 Form 8-K)
	10.16		Subordinated Debenture Purchase Agreement, dated as of December 28, 2007, between The Park National Bank, as “Borrower,” and USB Capital Funding Corp., as “Lender” (incorporated herein by reference to Exhibit 10.1 to Park’s January 2, 2008 Form 8-K)

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Exhibit No.			Description of Exhibit
	10.17	(a)†	Form of Split-Dollar Agreement, made and entered into effective as of December 28, 2007, covering Non-Employee Directors of Park National Corporation (incorporated herein by reference to Exhibit 10.2(a) to Park’s January 2, 2008 Form 8-K)
	10.17	(b)†	Schedule identifying Non-Employee Directors of Park National Corporation covered by Split-Dollar Agreement, made and entered into effective as of December 28, 2007 (filed herewith)
	10.18	†	Split-Dollar Agreement, made and entered into effective as of May 19, 2008, between Park National Bank and David L. Trautman (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on May 20, 2008 (File No. 1-13006))
	10.19	(a)†	Letter Agreement, dated December 19, 2008, between Park National Corporation and C. Daniel DeLawder (incorporated herein by reference to Exhibit 10.2.1 to Park’s December 23, 2008 Form 8-K) [NOTE: Appendix A to Letter Agreement is not included therewith; filed as Exhibit 10.1 to Park’s December 23, 2008 Form 8-K and incorporated by reference at Exhibit 4.6 of this Annual Report on Form 10-K]
	10.19	(b)†	Letter Agreement, dated December 19, 2008, between Park National Corporation and David L. Trautman (incorporated herein by reference to Exhibit 10.2.2 to Park’s December 23, 2008 Form 8-K) [NOTE: Appendix A to Letter Agreement is not included therewith; filed as Exhibit 10.1 to Park’s December 23, 2008 Form 8-K and incorporated by reference at Exhibit 4.6 of this Annual Report on Form 10-K]
	10.19	(c)†	Letter Agreement, dated December 19, 2008, between Park National Corporation and John W. Kozak (incorporated herein by reference to Exhibit 10.2.3 to Park’s December 23, 2008 Form 8-K) [NOTE: Appendix A to Letter Agreement is not included therewith; filed as Exhibit 10.1 to Park’s December 23, 2008 Form 8-K and incorporated by reference at Exhibit 4.6 of this Annual Report on Form 10-K]
	10.20	†	Park National Corporation Bonus Program adopted on December 16, 2008 (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on December 19, 2008 (File No. 1-13006)
	12		Computation of ratios (filed herewith)
	13		2008 Annual Report (not deemed filed except for portions thereof which are specifically incorporated by reference in this Annual Report on Form 10-K) (filed herewith)
	14		Code of Business Conduct and Ethics, as amended January 26, 2009 and updated January 30, 2009 (filed herewith)

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Exhibit No.		Description of Exhibit
	21	Subsidiaries of Park National Corporation (filed herewith)
	23	Consent of Crowe Horwath LLP (filed herewith)
	24	Powers of Attorney of Directors and Executive Officers of Park National Corporation (filed herewith)
	31.1	Rule 13a-14(a)/15d-14(a) Certification — Principal Executive Officer (filed herewith)
	31.2	Rule 13a-14(a)/15d-14(a) Certification — Principal Financial Officer (filed herewith)
	32	Section 1350 Certification — Principal Executive Officer and Principal Financial Officer (filed herewith)

*	The forms of employment agreements attached as Exhibits C-6 through C-12 to the Vision Bancshares Merger Agreement and the Vision Bancshares Disclosure Schedule referenced in the Vision Bancshares Merger Agreement have been omitted pursuant to Item 601(b)(2) of SEC Regulation S-K. Park National Corporation hereby undertakes to furnish supplementally a copy of the Vision Bancshares Disclosure Schedule and Exhibits C-6 through C-12 to the Vision Bancshares Merger Agreement to the SEC upon request by the SEC.
**	The schedules referenced in the Credit Card Account Purchase Agreement have been omitted pursuant to Item 601(b)(2) of SEC Regulation S-K. Park National Corporation hereby undertakes to furnish supplementally a copy of any omitted schedule to the Credit Card Account Purchase Agreement to the SEC upon request by the SEC.
†	Management contract or compensatory plan or arrangement.

(b) Exhibits.

The documents listed in Item 15(a)(3) are filed with this Annual Report on Form 10-K as exhibits or incorporated into this Annual Report on Form 10-K by reference.

(c) Financial Statement Schedules.

None

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SIGNATURES

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 its behalf by the undersigned, thereunto duly authorized.

	PARK NATIONAL CORPORATION
Date: February 25, 2009	By:	/s/ C. Daniel DeLawder
		C. Daniel DeLawder,
		Chairman of the Board and Chief Executive Officer

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 indicated on the 25th day of February, 2009.

Name	Capacity
/s/ C. Daniel DeLawder
C. Daniel DeLawder	Chairman of the Board, Chief Executive Officer and Director
/s/ David L. Trautman* David L. Trautman	President, Secretary and Director
/s/ John W. Kozak
John W. Kozak	Chief Financial Officer
/s/ Brady T. Burt
Brady T. Burt	Chief Accounting Officer
/s/ Nicholas L. Berning* Nicholas L. Berning	Director
/s/ Maureen Buchwald* Maureen Buchwald	Director
/s/ James J. Cullers* James J. Cullers	Director

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Name	Capacity
/s/ Harry O. Egger* Harry O. Egger	Director
/s/ F. William Englefield IV* F. William Englefield IV	Director
/s/ William T. McConnell* William T. McConnell	Director
/s/ John J. O’Neill* John J. O’Neill	Director
/s/ William A. Phillips* William A. Phillips	Director
/s/ J. Gilbert Reese* J. Gilbert Reese	Director
/s/ Rick R. Taylor* Rick R. Taylor	Director
/s/ Leon Zazworsky* Leon Zazworsky	Director

* The above-named directors of the Registrant sign this Annual Report on Form 10-K by C. Daniel DeLawder, their attorney-in-fact, pursuant to Powers of Attorney signed by the above-named directors, which Powers of Attorney are filed with this Annual Report on Form 10-K as exhibits, in the capacities indicated and on the 25th day of February, 2009.

By:	/s/ C. Daniel DeLawder
	C. Daniel DeLawder
	Chairman of the Board and Chief Executive Officer

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PARK NATIONAL CORPORATION

Annual Report on Form 10-K
for the
Fiscal Year Ended December 31, 2008

INDEX TO EXHIBITS

Exhibit No.	Description of Exhibit
2.1(a)	Agreement and Plan of Merger, dated to be effective as of September 14, 2006, by and between Park National Corporation and Vision Bancshares, Inc. (the “Vision Bancshares Merger Agreement”) (incorporated herein by reference to Annex A to the Prospectus of Park National Corporation/Proxy Statement of Vision Bancshares, Inc. dated January 9, 2007, filed on January 11, 2007 pursuant to Rule 424(b)(3) under the Securities Act of 1933 (Registration No. 333-139083))*
2.1(b)	First Amendment to Agreement and Plan of Merger, dated to be effective as of February 6, 2007, by and between Park National Corporation and Vision Bancshares, Inc. (incorporated herein by reference to Exhibit 2.1(b) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 (File No. 1-13006) (“Park’s 2006 Form 10-K”))
2.2	Plan of Merger and Merger Agreement between Vision Bank (an Alabama state-chartered bank with its main office located in Gulf Shores, Alabama) and Vision Bank (a Florida state-chartered bank with its main office located in Panama City, Florida), dated July 10, 2007 (incorporated herein by reference to Exhibit 2.1 to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2007 (File No. 1-13006))
2.3	Agreement to Merge, entered into as of May 21, 2008, by and between (a) each of (i) The Richland Trust Company, (ii) Century National Bank, (iii) The First-Knox National Bank of Mount Vernon, (iv) United Bank, National Association (also referred to as United Bank, N.A.), (v) Second National Bank, (vi) The Security National Bank and Trust Co. and (vii) The Citizens National Bank of Urbana; and (b) The Park National Bank (incorporated herein by reference to Exhibit 2.1 to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2008 (File No. 1-13006))
2.4	Credit Card Account Purchase Agreement by and between U.S. Bank National Association ND, d/b/a Elan Financial Services and The Park National Bank (also known as Park National Bank), executed on October 10, 2008 with an effective date of September 30, 2008** (incorporated herein by reference to Exhibit 2.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on October 14, 2008 (File No. 1-13006))
3.1(a)	Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on March 24, 1992 (incorporated herein by reference to Exhibit 3(a) to Park National Corporation’s Form 8-B, filed on May 20, 1992 (File No. 0-18772) (“Park’s Form 8-B”))
3.1(b)	Certificate of Amendment to the Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on May 6, 1993 (incorporated herein by reference to Exhibit 3(b) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 1993 (File No. 0-18772))
3.1(c)	Certificate of Amendment to the Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on April 16, 1996 (incorporated herein by reference to Exhibit 3(a) to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1996 (File No. 1-13006))

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Exhibit No.	Description of Exhibit
3.1(d)	Certificate of Amendment by Shareholders to the Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on April 22, 1997 (incorporated herein by reference to Exhibit 3(a)(1) to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1997 (File No. 1-13006) (“Park’s June 30, 1997 Form 10-Q”))
3.1(e)	Certificate of Amendment by Shareholders or Members as filed with the Secretary of State of the State of Ohio on December 18, 2008 in order to evidence the adoption by the shareholders of Park National Corporation on December 18, 2008 of an amendment to Article FOURTH of Park National Corporation’s Articles of Incorporation to authorize Park National Corporation to issue up to 200,000 preferred shares, without par value (incorporated herein by reference to Exhibit 3.1 to Park National Corporation’s Current Report on Form 8-K dated and filed December 19, 2008 (File No. 1-13006))
3.1(f)	Certificate of Amendment by Directors or Incorporators to Articles as filed with the Secretary of State of the State of Ohio on December 19, 2008, evidencing adoption of amendment by Board of Directors of Park National Corporation to Article FOURTH of Articles of Incorporation to establish express terms of Fixed Rate Cumulative Perpetual Preferred Shares, Series A, each without par value, of Park National Corporation (incorporated herein by reference to Exhibit 3.1 to Park National Corporation’s Current Report on Form 8-K dated and filed December 23, 2008 (File No. 1-13006) (“Park’s December 23, 2008 Form 8-K”))
3.1(g)	Articles of Incorporation of Park National Corporation (reflecting amendments through December 19, 2008) [for SEC reporting compliance purposes only — not filed with Ohio Secretary of State] (filed herewith)
3.2(a)	Regulations of Park National Corporation (incorporated herein by reference to Exhibit 3(b) to Park’s Form 8-B)
3.2(b)	Certified Resolution regarding Adoption of Amendment to Subsection 2.02(A) of the Regulations of Park National Corporation by Shareholders on April 21, 1997 (incorporated herein by reference to Exhibit 3(b)(1) to Park’s June 30, 1997 Form 10-Q)
3.2(c)	Certificate Regarding Adoption of Amendments to Sections 1.04 and 1.11 of Park National Corporation’s Regulations by the Shareholders on April 17, 2006 (incorporated herein by reference to Exhibit 3.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on April 18, 2006 (File No. 1-13006))
3.2(d)	Certificate Regarding Adoption by the Shareholders of Park National Corporation on April 21, 2008 of Amendment to Regulations to Add New Section 5.10 to Article FIVE (incorporated herein by reference to Exhibit 3.2(d) to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2008 (“Park’s March 31, 2008 Form 10-Q”) (File No. 1-13006))
3.2(e)	Regulations of Park National Corporation (reflecting amendments through April 21, 2008) [For purposes of SEC reporting compliance only] (incorporated herein by reference to Exhibit 3.2 (e) to Park’s March 31, 2008 Form 10-Q)
4.1(a)	Junior Subordinated Indenture, dated as of December 5, 2005, between Vision Bancshares, Inc. and Wilmington Trust Company, as Trustee (incorporated herein by reference to Exhibit 10.16 to Vision Bancshares, Inc.’s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 (File No. 000-50719))
4.1(b)	First Supplemental Indenture, dated to be effective as of 6:00 p.m., Eastern Standard Time, on March 9, 2007, among Wilmington Trust Company, as Trustee; Park National Corporation; and Vision Bancshares, Inc. (incorporated herein by reference to Exhibit 4.1(b) to Park National Corporation’s Current Report on Form 8-K dated and filed March 15, 2007 (File No. 1-13006) (“Park’s March 15, 2007 Form 8-K”))

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Exhibit No.	Description of Exhibit
4.2(a)	Amended and Restated Trust Agreement, dated as of December 5, 2005, among Vision Bancshares, Inc., as Depositor; Wilmington Trust Company, as Property Trustee and as Delaware Trustee; and the Administrative Trustees named therein, in respect of Vision Bancshares Trust I (incorporated herein by reference to Exhibit 10.15 to Vision Bancshares, Inc.’s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 (File No. 000-50719)) Note: Pursuant to the First Supplemental Indenture, dated to be effective as of 6:00 p.m., Eastern Standard Time, on March 9, 2007, among Wilmington Trust Company, as Trustee; Park National Corporation; and Vision Bancshares, Inc., Park National Corporation succeeded to and was substituted for Vision Bancshares, Inc. as “Depositor”
4.2(b)	Notice of Resignation of Administrative Trustees and Appointment of Successors, dated March 9, 2007, delivered to Wilmington Trust Company by the Resigning Administrative Trustees named therein, the Successor Administrative Trustees named therein and Park National Corporation (incorporated herein by reference to Exhibit 4.2(b) to Park’s March 15, 2007 Form 8-K)
4.3	Guarantee Agreement, dated as of December 5, 2005, between Vision Bancshares, Inc., as Guarantor, and Wilmington Trust Company, as Guarantee Trustee, in respect of Vision Bancshares Trust I (incorporated herein by reference to Exhibit 10.17 to Vision Bancshares, Inc.’s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 (File No. 000-50719)) Note: Pursuant to the First Supplemental Indenture, dated to be effective as of 6:00 p.m., Eastern Standard Time, on March 9, 2007, among Wilmington Trust Company, as Trustee; Park National Corporation; and Vision Bancshares, Inc., Park National Corporation succeeded to and was substituted for Vision Bancshares, Inc. as “Guarantor”
4.4	Subordinated Debenture, dated December 28, 2007, in the principal amount of $25,000,000, issued by The Park National Bank to USB Capital Funding Corp. (incorporated herein by reference to Park National Corporation’s Current Report on Form 8-K dated and filed on January 2, 2008 (“Park’s January 2, 2008 Form 8-K”))
4.5	Warrant to Purchase 227,376 Shares of Common Stock (Common Shares) of Park National Corporation issued to the United States Department of the Treasury on December 23, 2008 (incorporated herein by reference to Exhibit 4.1 to Park’s December 23, 2008 Form 8-K)
4.6	Letter Agreement, dated December 23, 2008, including Securities Purchase Agreement — Standard Terms attached thereto as Exhibit A, between Park National Corporation and the United States Department of the Treasury (incorporated herein by reference to Exhibit 10.1 to Park’s December 23, 2008 Form 8-K) [NOTE:
	Annex A to Securities Purchase Agreement is not included therewith; filed as Exhibit 3.1 to Park’s December 23, 2008 Form 8-K and incorporated by reference at Exhibit 3.1(f) of this Annual Report on Form 10-K]
4.7	Agreement to furnish instruments and agreements defining rights of holders of long-term debt (filed herewith)
10.1†	Summary of Base Salaries for Executive Officers of Park National Corporation (filed herewith)
10.2†	Summary of Incentive Compensation Plan of Park National Corporation for the twelve-month period ended September 30, 2008 (filed herewith)
10.3(a)†	Split-Dollar Agreement, dated May 17, 1993, between William T. McConnell and The Park National Bank (incorporated herein by reference to Exhibit 10(f) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 1993 (File No. 0-18772))

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Exhibit No.	Description of Exhibit
10.3(b)†	Schedule identifying Split-Dollar Agreements covering executive officers or employees of The Park National Bank or one of its divisions who are also directors or executive officers of Park National Corporation, which Split-Dollar Agreements are identical to the Split-Dollar Agreement, dated May 17, 1993, between William T. McConnell and The Park National Bank (filed herewith)
10.4†	Park National Corporation 1995 Incentive Stock Option Plan (reflects amendments and share dividends through December 15, 2004) (incorporated herein by reference to Exhibit 10.5 to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 2004 (File No. 1-13006) (“Park’s 2004 Form 10-K”))
10.5†	Form of Stock Option Agreement executed in connection with the grant of options under the Park National Corporation 1995 Incentive Stock Option Plan, as amended (incorporated herein by reference to Exhibit 10(i) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 1998 (File No. 1-13006))
10.6(a)†	Description of Park National Corporation Supplemental Executive Retirement Benefits as in effect during fiscal year ended December 31, 2007 and until February 18, 2008 (incorporated herein by reference to Exhibit 10.6(a) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007 (File No. 1-13006))
10.6(b)†	Form of Supplemental Executive Retirement Plan Agreement entered into by and between Park National Corporation or a wholly-owned subsidiary of Park National Corporation and each of C. Daniel DeLawder, John W. Kozak and William T. McConnell on December 27, 1996 (incorporated herein by reference to Exhibit 10.7(b) to Park National Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 (File No. 1-13006))
10.7(a)†	Description of Park National Corporation Supplemental Executive Retirement Benefits as in effect from and after February 18, 2008 (filed herewith)
10.7(b)†	Supplemental Executive Retirement Benefits Agreement, made as of February 18, 2008, between Park National Corporation and David L. Trautman (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed February 19, 2008 (File No. 1-13006)(“Park’s February 19, 2008 Form 8-K”))
10.7(c)†	Form of Amended and Restated Supplemental Executive Retirement Benefits Agreement, made as of February 18, 2008, between Park National Corporation and each of C. Daniel DeLawder, John W. Kozak and William T. McConnell (incorporated herein by reference to Exhibit 10.2 to Park’s February 19, 2008 Form 8-K)
10.8†	Security Banc Corporation 1998 Stock Option Plan, which was assumed by Park National Corporation (incorporated herein by reference to Exhibit 10(c) to Park National Corporation’s Registration Statement on Form S-8 filed April 23, 2001 (Registration No. 333-59378))
10.9†	Employment Agreement, made and entered into as of December 22, 1999, and the Amendment thereto, dated March 23, 2001, between The Security National Bank and Trust Co. (also known as Security National Bank and Trust Co.) and Harry O. Egger (incorporated herein by reference to Exhibit 10(e) to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2001 (File No. 1-13006))
10.10†	Park National Corporation Stock Plan for Non-Employee Directors of Park National Corporation and Subsidiaries (incorporated herein by reference to Exhibit 10 to Park National Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2004 (File No. 1-13006))

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Exhibit No.	Description of Exhibit
10.11†	Summary of Certain Compensation for Directors of Park National Corporation (filed herewith)
10.12†	Security National Bank and Trust Co. Second Amended and Restated 1988 Deferred Compensation Plan (filed herewith)
10.13†	Park National Corporation 2005 Incentive Stock Option Plan (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on April 20, 2005 (File No. 1-13006) (“Park’s April 20, 2005 Form 8-K”))
10.14†	Form of Stock Option Agreement to be used in connection with the grant of incentive stock options under the Park National Corporation 2005 Incentive Stock Option Plan (incorporated herein by reference to Exhibit 10.2 to Park’s April 20, 2005 Form 8-K)
10.15(a)	Credit Agreement, dated as of March 12, 2007, between JPMorgan Chase Bank, N.A. and Park National Corporation (incorporated herein by reference to Exhibit 10.1(a) to Park’s March 15, 2007 Form 8-K)
10.15(b)	Amendment to Credit Agreement, dated as of January 10, 2008, between Park National Corporation and JPMorgan Chase Bank, N.A. (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on January 11, 2008 (File No. 1-13006) (“Park’s January 11, 2008 Form 8-K”))
10.15(c)	Line of Credit Note, dated January 10, 2008, issued by Park National Corporation to JPMorgan Chase Bank, N.A. or order (incorporated herein by reference to Exhibit 10.2 to Park’s January 11, 2008 Form 8-K)
10.16	Subordinated Debenture Purchase Agreement, dated as of December 28, 2007, between The Park National Bank, as “Borrower,” and USB Capital Funding Corp., as “Lender” (incorporated herein by reference to Exhibit 10.1 to Park’s January 2, 2008 Form 8-K)
10.17(a)†	Form of Split-Dollar Agreement, made and entered into effective as of December 28, 2007, covering Non-Employee Directors of Park National Corporation (incorporated herein by reference to Exhibit 10.2(a) to Park’s January 2, 2008 Form 8-K)
10.17(b)†	Schedule identifying Non-Employee Directors of Park National Corporation covered by Split-Dollar Agreement, made and entered into effective as of December 28, 2007 (filed herewith)
10.18†	Split-Dollar Agreement, made and entered into effective as of May 19, 2008, between Park National Bank and David L. Trautman (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on May 20, 2008 (File No. 1-13006))
10.19(a)†	Letter Agreement, dated December 19, 2008, between Park National Corporation and C. Daniel DeLawder (incorporated herein by reference to Exhibit 10.2.1 to Park’s December 23, 2008 Form 8-K) [NOTE: Appendix A to Letter Agreement is not included therewith; filed as Exhibit 10.1 to Park’s December 23, 2008 Form 8-K and incorporated by reference at Exhibit 4.6 of this Annual Report on Form 10-K]
10.19(b)†	Letter Agreement, dated December 19, 2008, between Park National Corporation and David L. Trautman (incorporated herein by reference to Exhibit 10.2.2 to Park’s December 23, 2008 Form 8-K) [NOTE: Appendix A to Letter Agreement is not included therewith; filed as Exhibit 10.1 to Park’s December 23, 2008 Form 8-K and incorporated by reference at Exhibit 4.6 of this Annual Report on Form 10-K]

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Exhibit No.	Description of Exhibit
10.19(c)†	Letter Agreement, dated December 19, 2008, between Park National Corporation and John W. Kozak (incorporated herein by reference to Exhibit 10.2.3 to Park’s December 23, 2008 Form 8-K) [NOTE: Appendix A to Letter Agreement is not included therewith; filed as Exhibit 10.1 to Park’s December 23, 2008 Form 8-K and incorporated by reference at Exhibit 4.6 of this Annual Report on Form 10-K]
10.20†	Park National Corporation Bonus Program adopted on December 16, 2008 (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on December 19, 2008 (File No. 1-13006)
12	Computation of ratios (filed herewith)
13	2008 Annual Report (not deemed filed except for portions thereof which are specifically incorporated by reference in this Annual Report on Form 10-K) (filed herewith)
14	Code of Business Conduct and Ethics, as amended January 26, 2009 and updated January 30, 2009 (filed herewith)
21	Subsidiaries of Park National Corporation (filed herewith)
23	Consent of Crowe Horwath LLP (filed herewith)
24	Powers of Attorney of Directors and Executive Officers of Park National Corporation (filed herewith)
31.1	Rule 13a-14(a)/15d-14(a) Certification — Principal Executive Officer (filed herewith)
31.2	Rule 13a-14(a)/15d-14(a) Certification — Principal Financial Officer (filed herewith)
32	Section 1350 Certification — Principal Executive Officer and Principal Financial Officer (filed herewith)

*	The forms of employment agreements attached as Exhibits C-6 through C-12 to the Vision Bancshares Merger Agreement and the Vision Bancshares Disclosure Schedule referenced in the Vision Bancshares Merger Agreement have been omitted pursuant to Item 601(b)(2) of SEC Regulation S-K. Park National Corporation hereby undertakes to furnish supplementally a copy of the Vision Bancshares Disclosure Schedule and Exhibits C-6 through C-12 to the Vision Bancshares Merger Agreement upon request by the SEC.
**	The schedules referenced in the Credit Card Account Purchase Agreement have been omitted pursuant to Item 601(b)(2) of SEC Regulation S-K. Park National Corporation hereby undertakes to furnish supplementally a copy of any omitted schedule to the Credit Card Account Purchase Agreement to the SEC upon request by the SEC.
†	Management contract or compensatory plan or arrangement.

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EX-3.1G

Exhibit 3.1(g)

Articles of Incorporation of Park National
Corporation (reflecting amendments
through December 19, 2008)
[For purposes of SEC reporting compliance only]

ARTICLES OF INCORPORATION

OF

PARK NATIONAL CORPORATION

(reflecting amendments through December 19, 2008)

[For purposes of SEC reporting compliance only]

     FIRST:  The name of the corporation shall be Park National Corporation (the “Corporation”).

     SECOND:  The place in Ohio where the principal office of the Corporation is to be located is in the City of Newark, County of Licking.

     THIRD:  The purpose for which the Corporation is formed is to engage in any lawful act or activity for which corporations may be formed under Sections 1701.01 to 1701.98 of the Ohio Revised Code.

     FOURTH:  The authorized number of shares of the Corporation shall be Twenty Million Two Hundred Thousand (20,200,000), consisting of Twenty Million (20,000,000) common shares, each without par value (the “common shares”), and Two Hundred Thousand (200,000) preferred shares, each without par value (the “preferred shares”).

     The directors of the Corporation are hereby authorized to provide for the issuance of, and to issue, one or more series of preferred shares and, in connection with the creation of any such series, to adopt an amendment or amendments to the Articles of the Corporation determining, in whole or in part, the express terms of any such series to the fullest extent now or hereafter permitted under Ohio law, including, but not limited to, determining: the division of such shares into series and the designation and authorized number of shares of each series; dividend or distribution rights; dividend rate; liquidation rights, preferences and price; redemption rights and price; sinking fund requirements; voting rights; pre-emptive rights; conversion rights; restrictions on the issuance of shares; and other relative, participating, optional or other special rights and privileges of each such series and the qualifications, limitations or restrictions thereof. Notwithstanding the foregoing, in no event shall the voting rights of any series of preferred shares be greater than the voting rights of the common shares, except to the extent specifically required with respect to any series of preferred shares which may be designated for issuance to the United States Department of the Treasury under the TARP Capital Purchase Program instituted under the Emergency Economic Stabilization Act of 2008. In the event that at any time the directors of the Corporation shall have established and designated one or more series of preferred shares consisting of a number of shares which constitutes less than all of the authorized number of preferred shares, the remaining authorized preferred shares shall be deemed to be shares of an undesignated series of preferred shares until designated by the directors of the Corporation as being part of a series previously established or a new series then being established by the directors. Without limiting the generality of the foregoing, and subject to the rights of any series of preferred shares then outstanding, the amendment providing for issuance of any series of preferred shares may provide that such series shall be superior or rank equally or be junior to the preferred shares of any other series to the extent permitted by Ohio law.

     Section I of Article FOURTH — Express Terms of Fixed Rate Cumulative Perpetual Preferred Shares, Series A

     Part 1. Designation and Number of Shares. There is hereby created out of the authorized and unissued preferred shares of the Corporation a series of preferred shares designated as the “Fixed Rate Cumulative Perpetual Preferred Shares, Series A” (the “Designated Preferred Stock”). The authorized number of shares of Designated Preferred Stock shall be 100,000.

     Part 2. Standard Provisions. The Standard Provisions contained in Annex A attached hereto are incorporated herein by reference in their entirety and shall be deemed to be a part hereof to the same extent as if such provisions had been set forth in full herein.

     Part 3. Definitions. The following terms are used in this Section I (including the Standard Provisions in Annex A hereto) as defined below:

     (a) “Common Stock” means the common shares, each without par value, of the Corporation.

     (b) “Dividend Payment Date” means February 15, May 15, August 15 and November 15 of each year.

     (c) “Junior Stock” means the Common Stock, and any other class or series of stock of the Corporation the terms of which expressly provide that it ranks junior to Designated Preferred Stock as to dividend rights and/or as to rights on liquidation, dissolution or winding up of the Corporation.

     (d) “Liquidation Amount” means $1,000 per share of Designated Preferred Stock.

     (e) “Minimum Amount” means $25,000,000.

     (f) “Parity Stock” means any class or series of stock of the Corporation (other than Designated Preferred Stock) the terms of which do not expressly provide that such class or series will rank senior or junior to Designated Preferred Stock as to dividend rights and/or as to rights on liquidation, dissolution or winding up of the Corporation (in each case without regard to whether dividends accrue cumulatively or non-cumulatively).

     (g) “Signing Date” means the Original Issue Date.

     Part 4. Certain Voting Matters. Holders of shares of Designated Preferred Stock will be entitled to one vote for each such share on any matter on which holders of Designated Preferred Stock are entitled to vote, including any action by written consent.

     FIFTH:  The directors of the Corporation shall have the power to cause the Corporation from time to time and at any time to purchase, hold, sell, transfer or otherwise deal with (A) shares of any class or series issued by it, (B) any security or other obligation of the Corporation which may confer upon the holder thereof the right to convert the same into shares of any class or series authorized by the Articles of the Corporation, and (C) any security or other obligation which may confer upon the holder thereof the right to purchase shares of any class or series authorized by the Articles of the Corporation. The Corporation shall have the right to repurchase, if and when any shareholder desires to sell, or on the happening of any event is required to sell, shares of any class or series issued by the Corporation. The

2

authority granted in this Article FIFTH of these Articles shall not limit the plenary authority of the directors to purchase, hold, sell, transfer or otherwise deal with shares of any class or series, securities, or other obligations issued by the Corporation or authorized by its Articles.

     SIXTH:  The holders of the shares of any class of the Corporation shall, upon the offering or sale of any shares of the Corporation of the same class, have the right, during a reasonable time and on reasonable terms fixed by the directors, to purchase such shares in proportion to their respective holdings of shares of such class at the price fixed for the sale of the shares, unless (A) the shares offered or sold are treasury shares; or (B) the shares offered or sold are issued as a share dividend or distribution; or (C) the shares are offered or sold in connection with any merger or consolidation to which the Corporation is a party or any acquisition of, or investment in, another corporation, partnership, proprietorship or other business entity or its assets by the Corporation, whether directly or indirectly, by any means whatsoever; or (D) the shares are offered or sold pursuant to the terms of a stock option plan or employee benefit, compensation or incentive plan, which stock option plan or employee benefit, compensation or incentive plan is approved by the holders of three-fourths of the issued and outstanding shares of the Corporation; or (E) the shares offered or sold are released from preemptive rights by the affirmative vote or written consent of the holders of two-thirds of the shares entitled to such preemptive rights.

     SEVENTH:  Chapter 1704 of the Ohio Revised Code does not apply to the Corporation.

     EIGHTH: (A) In addition to any affirmative vote required by any provision of the Ohio Revised Code or by any other provision of these Articles, the affirmative vote or consent of the holders of the greater of (i) four-fifths (4/5) of the outstanding common shares of the Corporation entitled to vote thereon or (ii) that fraction of such outstanding common shares having as the numerator a number equal to the sum of (a) the number of outstanding common shares Beneficially Owned by Controlling Persons (as hereinafter defined) plus (b) two-thirds (2/3) of the remaining number of outstanding common shares, and as the denominator a number equal to the total number of outstanding common shares entitled to vote, shall be required for the adoption or authorization of a Business Combination (as hereinafter defined) unless:

               (1) The Business Combination will result in an involuntary sale, redemption, cancellation or other termination of ownership of all common shares of the Corporation owned by shareholders who do not vote in favor of, or consent in writing to, the Business Combination and the cash or fair value of other readily marketable consideration to be received by such shareholders for such common shares shall at least be equal to the Minimum Price Per Share (as hereinafter defined); and

               (2) A proxy statement responsive to the requirements of the Securities Exchange Act of 1934 shall be mailed to the shareholders of the Corporation for the purpose of soliciting shareholder approval of the proposed Business Combination.

          (B) For purposes of this Article EIGHTH, the following definitions shall apply:

               (1) “Affiliate” shall mean a Person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, another Person.

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               (2) “Associate” shall mean (a) any corporation or organization of which a Person is an officer or partner or is, directly or indirectly, the Beneficial Owner of ten percent (10%) or more of any class of equity securities, (b) any trust or other estate in which a Person has a ten percent (10%) or greater individual interest of any nature or as to which a Person serves as trustee or in a similar fiduciary capacity, (c) any spouse of a Person, and (d) any relative of a Person, or any relative of a spouse of a Person, who has the same residence as such Person or spouse.

               (3) “Beneficial Ownership” shall include without limitation (a) all shares directly or indirectly owned by a Person, by an Affiliate of such Person or by an Associate of such Person or such Affiliate, (b) all shares which such Person, Affiliate or Associate has the right to acquire through the exercise of any option, warrant or right (whether or not currently exercisable), through the conversion of a security, pursuant to the power to revoke a trust, discretionary account or similar arrangement, or pursuant to the automatic termination of a trust, discretionary account or similar arrangement; and (c) all shares as to which such Person, Affiliate or Associate directly or indirectly through any contract, arrangement, understanding, relationship or otherwise (including without limitation any written or unwritten agreement to act in concert) has or shares voting power (which includes the power to vote or to direct the voting of such shares) or investment power (which includes the power to dispose or direct the disposition of such shares) or both.

               (4) “Business Combination” shall mean (a) any merger or consolidation of the Corporation with or into a Controlling Person or an Affiliate of a Controlling Person or an Associate of such Controlling Person or Affiliate, (b) any sale, lease, exchange, transfer or other disposition, including without limitation a mortgage or any other security device, of all or any Substantial Part of the assets of the Corporation, including without limitation any voting securities of a Subsidiary, or of the assets of a Subsidiary, to a Controlling Person or Affiliate of a Controlling Person or Associate of such Controlling Person or Affiliate, (c) any merger into the Corporation, or into a Subsidiary, of a Controlling Person or an Affiliate of a Controlling Person or an Associate of such Controlling Person or Affiliate, (d) any sale, lease, exchange, transfer or other disposition to the Corporation or a Subsidiary of all or any part of the assets of a Controlling Person or Affiliate of a Controlling Person or Associate of such Controlling Person or Affiliate but not including any disposition of assets which, if included with all other dispositions consummated during the same fiscal year of the Corporation by the same Controlling Person, Affiliates thereof and Associates of such Controlling Person or Affiliates, would not result in dispositions during such year by all such Persons of assets having an aggregate fair value (determined at the time of disposition of the respective assets) in excess of one percent (1%) of the total consolidated assets of the Corporation (as shown on its certified balance sheet as of the end of the fiscal year preceding the proposed disposition); provided, however, that in no event shall any disposition of assets be excepted from shareholder approval by reason of the preceding exclusion if such disposition when included with all other dispositions consummated during the same and immediately preceding four (4) fiscal years of the Corporation by the same Controlling Person, Affiliates thereof and Associates of such Controlling Person or Affiliates, would result in disposition by all such Persons of assets having an aggregate fair value (determined at the time of disposition of the respective assets) in excess of two percent (2%) of the total consolidated assets of the Corporation (as shown on its certified balance sheet as of the end of the fiscal year preceding the proposed disposition), (e) any reclassification of the common shares of the Corporation, or any recapitalization involving common shares of the Corporation, consummated within five (5) years after a Controlling Person becomes a Controlling Person, and (f) any agreement, contract or other arrangement providing for any of the transactions described in the definition of Business Combination.

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               (5) “Control” shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

               (6) “Controlling Person” shall mean any Person who Beneficially Owns shares of the Corporation entitling that Person to exercise twenty percent (20%) or more of the voting power of the Corporation entitled to vote in the election of directors.

               (7) “Minimum Price Per Share” shall mean the sum of (a) the higher of either (i) the highest gross per share price paid or agreed to be paid to acquire any common shares of the Corporation Beneficially Owned by a Controlling Person, provided such payment or agreement to make payment was made within five (5) years immediately prior to the record date set to determine the shareholders entitled to vote or consent to the Business Combination in question, or (ii) the highest per share closing public market price for such common shares during such five (5) year period, plus (b) the aggregate amount, if any, by which five percent (5%) for each year, beginning on the date on which such Controlling Person became a Controlling Person, of such higher per share price exceeds the aggregate amount of all common share dividends per share paid in cash since the date on which such Person became a Controlling Person. The calculation of the Minimum Price Per Share shall require appropriate adjustments for capital changes, including without limitation stock splits, stock dividends and reverse stock splits.

               (8) “Person” shall mean an individual, a corporation, a partnership, an association, a joint-stock company, a trust, any unincorporated organization, a government or political subdivision thereof, and any other entity.

               (9) “Securities Exchange Act of 1934” shall mean the Securities Exchange Act of 1934, as amended from time to time as well as any successor or replacement statute.

               (10) “Subsidiary” shall mean any corporation more than twenty-five percent (25%) of whose outstanding securities entitled to vote for the election of directors are Beneficially Owned by the Corporation and/or one or more Subsidiaries.

               (11) “Substantial Part” shall mean more than ten percent (10%) of the total assets of the corporation in question, as shown on its certified balance sheet as of the end of the most recent fiscal year ending prior to the time the determination is being made.

          (C) During any period in which there are one or more Controlling Persons, this Article EIGHTH shall not be altered, changed or repealed unless the amendment effecting such alteration, change or repeal shall have received, in addition to any affirmative vote required by any provision of the Ohio Revised Code or by any other provision of these Articles, the affirmative vote or consent of the holders of the greater of (i) four-fifths (4/5) of the outstanding common shares of the Corporation entitled to vote thereon or (ii) that fraction of such outstanding common shares having as the numerator a number equal to the sum of (a) the number of outstanding common shares Beneficially Owned by Controlling Persons plus (b) two-thirds (2/3) of the remaining number of outstanding common shares, and as the denominator a number equal to the total number of outstanding common shares entitled to vote.

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ANNEX A to Section I of Article FOURTH — STANDARD PROVISIONS

     Section 1. General Matters. Each share of Designated Preferred Stock shall be identical in all respects to every other share of Designated Preferred Stock. The Designated Preferred Stock shall be perpetual, subject to the provisions of Section 5 of these Standard Provisions that form a part of the Certificate of Designations. The Designated Preferred Stock shall rank equally with Parity Stock and shall rank senior to Junior Stock with respect to the payment of dividends and the distribution of assets in the event of any dissolution, liquidation or winding up of the Corporation.

     Section 2. Standard Definitions. As used herein with respect to Designated Preferred Stock:

     (a) “Applicable Dividend Rate” means (i) during the period from the Original Issue Date to, but excluding, the first day of the first Dividend Period commencing on or after the fifth anniversary of the Original Issue Date, 5% per annum and (ii) from and after the first day of the first Dividend Period commencing on or after the fifth anniversary of the Original Issue Date, 9% per annum.

     (b) “Appropriate Federal Banking Agency” means the “appropriate Federal banking agency” with respect to the Corporation as defined in Section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. Section 1813(q)), or any successor provision.

     (c) “Business Combination” means a merger, consolidation, statutory share exchange or similar transaction that requires the approval of the Corporation’s shareholders.

     (d) “Business Day” means any day except Saturday, Sunday and any day on which banking institutions in the State of New York generally are authorized or required by law or other governmental actions to close.

     (e) “Certificate of Designations” means the Certificate of Designations or comparable instrument relating to the Designated Preferred Stock, of which these Standard Provisions form a part, as it may be amended from time to time.

     (f) “Charter” means the Corporation’s articles of incorporation, as they may be amended from time to time.

     (g) “Dividend Period” has the meaning set forth in Section 3(a).

     (h) “Dividend Record Date” has the meaning set forth in Section 3(a).

     (i) “Liquidation Preference” has the meaning set forth in Section 4(a).

     (j) “Original Issue Date” means the date on which shares of Designated Preferred Stock are first issued.

     (k) “Preferred Director” has the meaning set forth in Section 7(b).

     (l) “Preferred Stock” means any and all series of preferred stock of the Corporation, including the Designated Preferred Stock.

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     (m) “Qualified Equity Offering” means the sale and issuance for cash by the Corporation to persons other than the Corporation or any of its subsidiaries after the Original Issue Date of shares of perpetual Preferred Stock, Common Stock or any combination of such stock, that, in each case, qualify as and may be included in Tier 1 capital of the Corporation at the time of issuance under the applicable risk-based capital guidelines of the Corporation’s Appropriate Federal Banking Agency (other than any such sales and issuances made pursuant to agreements or arrangements entered into, or pursuant to financing plans which were publicly announced, on or prior to October 13, 2008).

     (n) “Regulations” means the regulations of the Corporation, as they may be amended from time to time.

     (o) “Share Dilution Amount” has the meaning set forth in Section 3(b).

     (p) “Standard Provisions” mean these Standard Provisions that form a part of the Certificate of Designations relating to the Designated Preferred Stock.

     (q) “Successor Preferred Stock” has the meaning set forth in Section 5(a).

     (r) “Voting Parity Stock” means, with regard to any matter as to which the holders of Designated Preferred Stock are entitled to vote as specified in Sections 7(a) and 7(b) of these Standard Provisions that form a part of the Certificate of Designations, any and all series of Parity Stock upon which like voting rights have been conferred and are exercisable with respect to such matter.

     Section 3. Dividends.

     (a) Rate. Holders of Designated Preferred Stock shall be entitled to receive, on each share of Designated Preferred Stock if, as and when declared by the Board of Directors or any duly authorized committee of the Board of Directors, but only out of assets legally available therefor, cumulative cash dividends with respect to each Dividend Period (as defined below) at a rate per annum equal to the Applicable Dividend Rate on (i) the Liquidation Amount per share of Designated Preferred Stock and (ii) the amount of accrued and unpaid dividends for any prior Dividend Period on such share of Designated Preferred Stock, if any. Such dividends shall begin to accrue and be cumulative from the Original Issue Date, shall compound on each subsequent Dividend Payment Date (i.e., no dividends shall accrue on other dividends unless and until the first Dividend Payment Date for such other dividends has passed without such other dividends having been paid on such date) and shall be payable quarterly in arrears on each Dividend Payment Date, commencing with the first such Dividend Payment Date to occur at least 20 calendar days after the Original Issue Date. In the event that any Dividend Payment Date would otherwise fall on a day that is not a Business Day, the dividend payment due on that date will be postponed to the next day that is a Business Day and no additional dividends will accrue as a result of that postponement. The period from and including any Dividend Payment Date to, but excluding, the next Dividend Payment Date is a “Dividend Period”, provided that the initial Dividend Period shall be the period from and including the Original Issue Date to, but excluding, the next Dividend Payment Date.

     Dividends that are payable on Designated Preferred Stock in respect of any Dividend Period shall be computed on the basis of a 360-day year consisting of twelve 30-day months. The amount of dividends payable on Designated Preferred Stock on any date prior to the end of a Dividend Period, and for the initial Dividend Period, shall be computed on the basis of a 360-day year consisting of twelve 30-day months, and actual days elapsed over a 30-day month.

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     Dividends that are payable on Designated Preferred Stock on any Dividend Payment Date will be payable to holders of record of Designated Preferred Stock as they appear on the stock register of the Corporation on the applicable record date, which shall be the 15th calendar day immediately preceding such Dividend Payment Date or such other record date fixed by the Board of Directors or any duly authorized committee of the Board of Directors that is not more than 60 nor less than 10 days prior to such Dividend Payment Date (each, a “Dividend Record Date”). Any such day that is a Dividend Record Date shall be a Dividend Record Date whether or not such day is a Business Day.

     Holders of Designated Preferred Stock shall not be entitled to any dividends, whether payable in cash, securities or other property, other than dividends (if any) declared and payable on Designated Preferred Stock as specified in this Section 3 (subject to the other provisions of the Certificate of Designations).

     (b) Priority of Dividends. So long as any share of Designated Preferred Stock remains outstanding, no dividend or distribution shall be declared or paid on the Common Stock or any other shares of Junior Stock (other than dividends payable solely in shares of Common Stock) or Parity Stock, subject to the immediately following paragraph in the case of Parity Stock, and no Common Stock, Junior Stock or Parity Stock shall be, directly or indirectly, purchased, redeemed or otherwise acquired for consideration by the Corporation or any of its subsidiaries unless all accrued and unpaid dividends for all past Dividend Periods, including the latest completed Dividend Period (including, if applicable as provided in Section 3(a) above, dividends on such amount), on all outstanding shares of Designated Preferred Stock have been or are contemporaneously declared and paid in full (or have been declared and a sum sufficient for the payment thereof has been set aside for the benefit of the holders of shares of Designated Preferred Stock on the applicable record date). The foregoing limitation shall not apply to (i) redemptions, purchases or other acquisitions of shares of Common Stock or other Junior Stock in connection with the administration of any employee benefit plan in the ordinary course of business (including purchases to offset the Share Dilution Amount (as defined below) pursuant to a publicly announced repurchase plan) and consistent with past practice, provided that any purchases to offset the Share Dilution Amount shall in no event exceed the Share Dilution Amount; (ii) purchases or other acquisitions by a broker-dealer subsidiary of the Corporation solely for the purpose of market-making, stabilization or customer facilitation transactions in Junior Stock or Parity Stock in the ordinary course of its business; (iii) purchases by a broker- dealer subsidiary of the Corporation of capital stock of the Corporation for resale pursuant to an offering by the Corporation of such capital stock underwritten by such broker-dealer subsidiary; (iv) any dividends or distributions of rights or Junior Stock in connection with a shareholders’ rights plan or any redemption or repurchase of rights pursuant to any shareholders’ rights plan; (v) the acquisition by the Corporation or any of its subsidiaries of record ownership in Junior Stock or Parity Stock for the beneficial ownership of any other persons (other than the Corporation or any of its subsidiaries), including as trustees or custodians; and (vi) the exchange or conversion of Junior Stock for or into other Junior Stock or of Parity Stock for or into other Parity Stock (with the same or lesser aggregate liquidation amount) or Junior Stock, in each case, solely to the extent required pursuant to binding contractual agreements entered into prior to the Signing Date or any subsequent agreement for the accelerated exercise, settlement or exchange thereof for Common Stock. “Share Dilution Amount” means the increase in the number of diluted shares outstanding (determined in accordance with generally accepted accounting principles in the United States, and as measured from the date of the Corporation’s consolidated financial statements most recently filed with the Securities and Exchange Commission prior to the Original Issue Date) resulting from the grant, vesting or exercise of equity-based compensation to employees and equitably adjusted for any stock split, stock dividend, reverse stock split, reclassification or similar transaction.

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     When dividends are not paid (or declared and a sum sufficient for payment thereof set aside for the benefit of the holders thereof on the applicable record date) on any Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment Dates, on a dividend payment date falling within a Dividend Period related to such Dividend Payment Date) in full upon Designated Preferred Stock and any shares of Parity Stock, all dividends declared on Designated Preferred Stock and all such Parity Stock and payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment Dates, on a dividend payment date falling within the Dividend Period related to such Dividend Payment Date) shall be declared pro rata so that the respective amounts of such dividends declared shall bear the same ratio to each other as all accrued and unpaid dividends per share on the shares of Designated Preferred Stock (including, if applicable as provided in Section 3(a) above, dividends on such amount) and all Parity Stock payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment Dates, on a dividend payment date falling within the Dividend Period related to such Dividend Payment Date) (subject to their having been declared by the Board of Directors or a duly authorized committee of the Board of Directors out of legally available funds and including, in the case of Parity Stock that bears cumulative dividends, all accrued but unpaid dividends) bear to each other. If the Board of Directors or a duly authorized committee of the Board of Directors determines not to pay any dividend or a full dividend on a Dividend Payment Date, the Corporation will provide written notice to the holders of Designated Preferred Stock prior to such Dividend Payment Date.

     Subject to the foregoing, and not otherwise, such dividends (payable in cash, securities or other property) as may be determined by the Board of Directors or any duly authorized committee of the Board of Directors may be declared and paid on any securities, including Common Stock and other Junior Stock, from time to time out of any funds legally available for such payment, and holders of Designated Preferred Stock shall not be entitled to participate in any such dividends.

     Section 4. Liquidation Rights.

     (a) Voluntary or Involuntary Liquidation. In the event of any liquidation, dissolution or winding up of the affairs of the Corporation, whether voluntary or involuntary, holders of Designated Preferred Stock shall be entitled to receive for each share of Designated Preferred Stock, out of the assets of the Corporation or proceeds thereof (whether capital or surplus) available for distribution to shareholders of the Corporation, subject to the rights of any creditors of the Corporation, before any distribution of such assets or proceeds is made to or set aside for the holders of Common Stock and any other stock of the Corporation ranking junior to Designated Preferred Stock as to such distribution, payment in full in an amount equal to the sum of (i) the Liquidation Amount per share and (ii) the amount of any accrued and unpaid dividends (including, if applicable as provided in Section 3(a) above, dividends on such amount), whether or not declared, to the date of payment (such amounts collectively, the “Liquidation Preference”).

     (b) Partial Payment. If in any distribution described in Section 4(a) above the assets of the Corporation or proceeds thereof are not sufficient to pay in full the amounts payable with respect to all outstanding shares of Designated Preferred Stock and the corresponding amounts payable with respect of any other stock of the Corporation ranking equally with Designated Preferred Stock as to such distribution, holders of Designated Preferred Stock and the holders of such other stock shall share ratably in any such distribution in proportion to the full respective distributions to which they are entitled.

     (c) Residual Distributions. If the Liquidation Preference has been paid in full to all holders of Designated Preferred Stock and the corresponding amounts payable with respect of any other stock of the Corporation ranking equally with Designated Preferred Stock as to such distribution has been paid in

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full, the holders of other stock of the Corporation shall be entitled to receive all remaining assets of the Corporation (or proceeds thereof) according to their respective rights and preferences.

     (d) Merger, Consolidation and Sale of Assets Not Liquidation. For purposes of this Section 4, the merger or consolidation of the Corporation with any other corporation or other entity, including a merger or consolidation in which the holders of Designated Preferred Stock receive cash, securities or other property for their shares, or the sale, lease or exchange (for cash, securities or other property) of all or substantially all of the assets of the Corporation, shall not constitute a liquidation, dissolution or winding up of the Corporation.

     Section 5. Redemption.

     (a) Optional Redemption. Except as provided below, the Designated Preferred Stock may not be redeemed prior to the first Dividend Payment Date falling on or after the third anniversary of the Original Issue Date. On or after the first Dividend Payment Date falling on or after the third anniversary of the Original Issue Date, the Corporation, at its option, subject to the approval of the Appropriate Federal Banking Agency, may redeem, in whole or in part, at any time and from time to time, out of funds legally available therefor, the shares of Designated Preferred Stock at the time outstanding, upon notice given as provided in Section 5(c) below, at a redemption price equal to the sum of (i) the Liquidation Amount per share and (ii) except as otherwise provided below, any accrued and unpaid dividends (including, if applicable as provided in Section 3(a) above, dividends on such amount) (regardless of whether any dividends are actually declared) to, but excluding, the date fixed for redemption.

     Notwithstanding the foregoing, prior to the first Dividend Payment Date falling on or after the third anniversary of the Original Issue Date, the Corporation, at its option, subject to the approval of the Appropriate Federal Banking Agency, may redeem, in whole or in part, at any time and from time to time, the shares of Designated Preferred Stock at the time outstanding, upon notice given as provided in Section 5(c) below, at a redemption price equal to the sum of (i) the Liquidation Amount per share and (ii) except as otherwise provided below, any accrued and unpaid dividends (including, if applicable as provided in Section 3(a) above, dividends on such amount) (regardless of whether any dividends are actually declared) to, but excluding, the date fixed for redemption; provided that (x) the Corporation (or any successor by Business Combination) has received aggregate gross proceeds of not less than the Minimum Amount (plus the “Minimum Amount” as defined in the relevant certificate of designations for each other outstanding series of preferred stock of such successor that was originally issued to the United States Department of the Treasury (the “Successor Preferred Stock”) in connection with the Troubled Asset Relief Program Capital Purchase Program) from one or more Qualified Equity Offerings (including Qualified Equity Offerings of such successor), and (y) the aggregate redemption price of the Designated Preferred Stock (and any Successor Preferred Stock) redeemed pursuant to this paragraph may not exceed the aggregate net cash proceeds received by the Corporation (or any successor by Business Combination) from such Qualified Equity Offerings (including Qualified Equity Offerings of such successor).

     The redemption price for any shares of Designated Preferred Stock shall be payable on the redemption date to the holder of such shares against surrender of the certificate(s) evidencing such shares to the Corporation or its agent. Any declared but unpaid dividends payable on a redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall not be paid to the holder entitled to receive the redemption price on the redemption date, but rather shall be paid to the holder of record of the redeemed shares on such Dividend Record Date relating to the Dividend Payment Date as provided in Section 3 above.

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     (b) No Sinking Fund. The Designated Preferred Stock will not be subject to any mandatory redemption, sinking fund or other similar provisions. Holders of Designated Preferred Stock will have no right to require redemption or repurchase of any shares of Designated Preferred Stock.

     (c) Notice of Redemption. Notice of every redemption of shares of Designated Preferred Stock shall be given by first class mail, postage prepaid, addressed to the holders of record of the shares to be redeemed at their respective last addresses appearing on the books of the Corporation. Such mailing shall be at least 30 days and not more than 60 days before the date fixed for redemption. Any notice mailed as provided in this Subsection shall be conclusively presumed to have been duly given, whether or not the holder receives such notice, but failure duly to give such notice by mail, or any defect in such notice or in the mailing thereof, to any holder of shares of Designated Preferred Stock designated for redemption shall not affect the validity of the proceedings for the redemption of any other shares of Designated Preferred Stock. Notwithstanding the foregoing, if shares of Designated Preferred Stock are issued in book-entry form through The Depository Trust Corporation or any other similar facility, notice of redemption may be given to the holders of Designated Preferred Stock at such time and in any manner permitted by such facility. Each notice of redemption given to a holder shall state: (1) the redemption date; (2) the number of shares of Designated Preferred Stock to be redeemed and, if less than all the shares held by such holder are to be redeemed, the number of such shares to be redeemed from such holder; (3) the redemption price; and (4) the place or places where certificates for such shares are to be surrendered for payment of the redemption price.

     (d) Partial Redemption. In case of any redemption of part of the shares of Designated Preferred Stock at the time outstanding, the shares to be redeemed shall be selected either pro rata or in such other manner as the Board of Directors or a duly authorized committee thereof may determine to be fair and equitable. Subject to the provisions hereof, the Board of Directors or a duly authorized committee thereof shall have full power and authority to prescribe the terms and conditions upon which shares of Designated Preferred Stock shall be redeemed from time to time. If fewer than all the shares represented by any certificate are redeemed, a new certificate shall be issued representing the unredeemed shares without charge to the holder thereof.

     (e) Effectiveness of Redemption. If notice of redemption has been duly given and if on or before the redemption date specified in the notice all funds necessary for the redemption have been deposited by the Corporation, in trust for the pro rata benefit of the holders of the shares called for redemption, with a bank or trust company doing business in the Borough of Manhattan, The City of New York, and having a capital and surplus of at least $500 million and selected by the Board of Directors, so as to be and continue to be available solely therefor, then, notwithstanding that any certificate for any share so called for redemption has not been surrendered for cancellation, on and after the redemption date dividends shall cease to accrue on all shares so called for redemption, all shares so called for redemption shall no longer be deemed outstanding and all rights with respect to such shares shall forthwith on such redemption date cease and terminate, except only the right of the holders thereof to receive the amount payable on such redemption from such bank or trust company, without interest. Any funds unclaimed at the end of three years from the redemption date shall, to the extent permitted by law, be released to the Corporation, after which time the holders of the shares so called for redemption shall look only to the Corporation for payment of the redemption price of such shares.

     (f) Status of Redeemed Shares. Shares of Designated Preferred Stock that are redeemed, repurchased or otherwise acquired by the Corporation shall revert to authorized but unissued shares of Preferred Stock (provided that any such cancelled shares of Designated Preferred Stock may be reissued only as shares of any series of Preferred Stock other than Designated Preferred Stock).

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     Section 6. Conversion. Holders of Designated Preferred Stock shares shall have no right to exchange or convert such shares into any other securities.

     Section 7. Voting Rights.

     (a) General. The holders of Designated Preferred Stock shall not have any voting rights except as set forth below or as otherwise from time to time required by law.

     (b) Preferred Stock Directors. Whenever, at any time or times, dividends payable on the shares of Designated Preferred Stock have not been paid for an aggregate of six quarterly Dividend Periods or more, whether or not consecutive, the authorized number of directors of the Corporation shall automatically be increased by two and the holders of the Designated Preferred Stock shall have the right, with holders of shares of any one or more other classes or series of Voting Parity Stock outstanding at the time, voting together as a class, to elect two directors (hereinafter the “Preferred Directors” and each a “Preferred Director”) to fill such newly created directorships at the Corporation’s next annual meeting of shareholders (or at a special meeting called for that purpose prior to such next annual meeting) and at each subsequent annual meeting of shareholders until all accrued and unpaid dividends for all past Dividend Periods, including the latest completed Dividend Period (including, if applicable as provided in Section 3(a) above, dividends on such amount), on all outstanding shares of Designated Preferred Stock have been declared and paid in full at which time such right shall terminate with respect to the Designated Preferred Stock, except as herein or by law expressly provided, subject to revesting in the event of each and every subsequent default of the character above mentioned; provided that it shall be a qualification for election for any Preferred Director that the election of such Preferred Director shall not cause the Corporation to violate any corporate governance requirements of any securities exchange or other trading facility on which securities of the Corporation may then be listed or traded that listed or traded companies must have a majority of independent directors. Upon any termination of the right of the holders of shares of Designated Preferred Stock and Voting Parity Stock as a class to vote for directors as provided above, the Preferred Directors shall cease to be qualified as directors, the term of office of all Preferred Directors then in office shall terminate immediately and the authorized number of directors shall be reduced by the number of Preferred Directors elected pursuant hereto. Any Preferred Director may be removed at any time, with or without cause, and any vacancy created thereby may be filled, only by the affirmative vote of the holders a majority of the shares of Designated Preferred Stock at the time outstanding voting separately as a class together with the holders of shares of Voting Parity Stock, to the extent the voting rights of such holders described above are then exercisable. If the office of any Preferred Director becomes vacant for any reason other than removal from office as aforesaid, the remaining Preferred Director may choose a successor who shall hold office for the unexpired term in respect of which such vacancy occurred.

     (c) Class Voting Rights as to Particular Matters. So long as any shares of Designated Preferred Stock are outstanding, in addition to any other vote or consent of shareholders required by law or by the Charter, the vote or consent of the holders of at least 66 2/3% of the shares of Designated Preferred Stock at the time outstanding, voting as a separate class, given in person or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose, shall be necessary for effecting or validating:

          (i) Authorization of Senior Stock. Any amendment or alteration of the Certificate of Designations for the Designated Preferred Stock or the Charter to authorize or create or increase the authorized amount of, or any issuance of, any shares of, or any securities convertible into or exchangeable or exercisable for shares of, any class or series of capital stock of the Corporation ranking senior to

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Designated Preferred Stock with respect to either or both the payment of dividends and/or the distribution of assets on any liquidation, dissolution or winding up of the Corporation;

          (ii) Amendment of Designated Preferred Stock. Any amendment, alteration or repeal of any provision of the Certificate of Designations for the Designated Preferred Stock or the Charter (including, unless no vote on such merger or consolidation is required by Section 7(c)(iii) below, any amendment, alteration or repeal by means of a merger, consolidation or otherwise) so as to adversely affect the rights, preferences, privileges or voting powers of the Designated Preferred Stock; or

          (iii) Share Exchanges, Reclassifications, Mergers and Consolidations. Any consummation of a binding share exchange or reclassification involving the Designated Preferred Stock, or of a merger or consolidation of the Corporation with another corporation or other entity, unless in each case (x) the shares of Designated Preferred Stock remain outstanding or, in the case of any such merger or consolidation with respect to which the Corporation is not the surviving or resulting entity, are converted into or exchanged for preference securities of the surviving or resulting entity or its ultimate parent, and (y) such shares remaining outstanding or such preference securities, as the case may be, have such rights, preferences, privileges and voting powers, and limitations and restrictions thereof, taken as a whole, as are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers, and limitations and restrictions thereof, of Designated Preferred Stock immediately prior to such consummation, taken as a whole;

provided, however, that for all purposes of this Section 7(c), any increase in the amount of the authorized Preferred Stock, including any increase in the authorized amount of Designated Preferred Stock necessary to satisfy preemptive or similar rights granted by the Corporation to other persons prior to the Signing Date, or the creation and issuance, or an increase in the authorized or issued amount, whether pursuant to preemptive or similar rights or otherwise, of any other series of Preferred Stock, or any securities convertible into or exchangeable or exercisable for any other series of Preferred Stock, ranking equally with and/or junior to Designated Preferred Stock with respect to the payment of dividends (whether such dividends are cumulative or non-cumulative) and the distribution of assets upon liquidation, dissolution or winding up of the Corporation will not be deemed to adversely affect the rights, preferences, privileges or voting powers, and shall not require the affirmative vote or consent of, the holders of outstanding shares of the Designated Preferred Stock.

     (d) Changes after Provision for Redemption. No vote or consent of the holders of Designated Preferred Stock shall be required pursuant to Section 7(c) above if, at or prior to the time when any such vote or consent would otherwise be required pursuant to such Section, all outstanding shares of the Designated Preferred Stock shall have been redeemed, or shall have been called for redemption upon proper notice and sufficient funds shall have been deposited in trust for such redemption, in each case pursuant to Section 5 above.

     (e) Procedures for Voting and Consents. The rules and procedures for calling and conducting any meeting of the holders of Designated Preferred Stock (including, without limitation, the fixing of a record date in connection therewith), the solicitation and use of proxies at such a meeting, the obtaining of written consents and any other aspect or matter with regard to such a meeting or such consents shall be governed by any rules of the Board of Directors or any duly authorized committee of the Board of Directors, in its discretion, may adopt from time to time, which rules and procedures shall conform to the requirements of the Charter, the Regulations, and applicable law and the rules of any national securities exchange or other trading facility on which Designated Preferred Stock is listed or traded at the time.

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     Section 8. Record Holders. To the fullest extent permitted by applicable law, the Corporation and the transfer agent for Designated Preferred Stock may deem and treat the record holder of any share of Designated Preferred Stock as the true and lawful owner thereof for all purposes, and neither the Corporation nor such transfer agent shall be affected by any notice to the contrary.

     Section 9. Notices. All notices or communications in respect of Designated Preferred Stock shall be sufficiently given if given in writing and delivered in person or by first class mail, postage prepaid, or if given in such other manner as may be permitted in this Certificate of Designations, in the Charter or the Regulations or by applicable law. Notwithstanding the foregoing, if shares of Designated Preferred Stock are issued in book-entry form through The Depository Trust Corporation or any similar facility, such notices may be given to the holders of Designated Preferred Stock in any manner permitted by such facility.

     Section 10. No Preemptive Rights. No share of Designated Preferred Stock shall have any rights of preemption whatsoever as to any securities of the Corporation, or any warrants, rights or options issued or granted with respect thereto, regardless of how such securities, or such warrants, rights or options, may be designated, issued or granted.

     Section 11. Replacement Certificates. The Corporation shall replace any mutilated certificate at the holder’s expense upon surrender of that certificate to the Corporation. The Corporation shall replace certificates that become destroyed, stolen or lost at the holder’s expense upon delivery to the Corporation of reasonably satisfactory evidence that the certificate has been destroyed, stolen or lost, together with any indemnity that may be reasonably required by the Corporation.

     Section 12. Other Rights. The shares of Designated Preferred Stock shall not have any rights, preferences, privileges or voting powers or relative, participating, optional or other special rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or in the Charter or as provided by applicable law.

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EX-4.7

Exhibit 4.7

PARK NATIONAL CORPORATION

50 North Third Street
Post Office Box 3500
Newark, Ohio 43058-3500
(740) 349-8451
www.parknationalcorp.com

February 25, 2009

United States Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549

Re:	Park National Corporation
	Commission File Number: 1-13006 Annual Report on Form 10-K for the Fiscal Year Ended December 31, 2008

Ladies and Gentlemen:

     Park National Corporation, an Ohio corporation (“Park”), is today filing with the Securities and Exchange Commission (the “SEC”) the Annual Report on Form 10-K of Park for the fiscal year ended December 31, 2008 (“Park’s 2008 Form 10-K”).

     Neither (i) Park nor (ii) any of Park’s consolidated subsidiaries has outstanding any instrument or agreement with respect to its long-term debt under which the total amount of long-term debt authorized exceeds 10% of the total assets of Park and Park’s subsidiaries on a consolidated basis. In accordance with the provisions of Item 601(b)(4)(iii) of SEC Regulation S-K, Park hereby agrees to furnish to the SEC, upon request, a copy of each instrument or agreement defining (i) the rights of holders of long-term debt of Park or (ii) the rights of holders of long-term debt of a consolidated subsidiary of Park, in each case which is not being filed or incorporated by reference as an exhibit to Park’s 2008 Form 10-K.

Very truly yours,

PARK NATIONAL CORPORATION
 

/s/ John W. Kozak  

John W. Kozak 

Chief Financial Officer 

EX-10.1

Exhibit 10.1

Summary of Base Salaries
for
Executive Officers of Park National Corporation

     On January 23, 2009, the Compensation Committee of the Board of Directors of Park National Corporation (“Park”) approved the base salaries for the fiscal year ending December 31, 2009, for each of the executive officers of Park: (a) C. Daniel DeLawder, Chairman of the Board and Chief Executive Officer of Park and The Park National Bank, a subsidiary of Park; (b) David L. Trautman, President and Secretary of Park and President of The Park National Bank; and (c) John W. Kozak, Chief Financial Officer of Park and Senior Vice President and Chief Financial Officer of The Park National Bank.

     Those base salaries, which are the same as the base salaries paid to each of the executive officers of Park for the fiscal year ended December 31, 2008, are:

• C. Daniel DeLawder — $473,525

• David L. Trautman — $313,250

• John W. Kozak — $214,455

EX-10.2

Exhibit 10.2

Summary of Incentive Compensation Plan of Park National
Corporation for the Twelve-Month Period Ending September 30, 2008

The Compensation Committee of the Board of Directors of Park National Corporation (“Park”) administers Park’s incentive compensation plan which may enable the officers of The Park National Bank (“PNB”) and its divisions, Scope Leasing, Inc. and Guardian Financial Services Company (collectively, “Park’s Principal Ohio-Based Subsidiaries”) to share in any above-average return on equity (as defined below) which Park and Park’s subsidiaries on a consolidated basis may generate during each twelve-month period ending September 30. For the fiscal year ended December 31, 2008 (the “2008 fiscal year”), all officers of Park’s Principal Ohio-Based Subsidiaries, including C. Daniel DeLawder (who served as Chairman of the Board and Chief Executive Officer of Park and PNB during the 2008 fiscal year and continues to so serve), David L. Trautman (who served as President and Secretary of Park and as President of PNB during the 2008 fiscal year and continues to so serve) and John W. Kozak (who served as Chief Financial Officer of Park and as Senior Vice President and Chief Financial Officer of PNB during the 2008 fiscal year and continues to so serve) were eligible to participate in the incentive compensation plan. Officers of Vision Bank and its divisions were not eligible to participate in the incentive compensation plan for the twelve-month period ended September 30, 2008 (the “2008 Incentive Compensation Period”) and did not earn any incentive compensation for 2008.

Above-average return on equity is defined as the amount by which the net income to average shareholders’ equity ratio of Park and Park’s subsidiaries on a consolidated basis for a twelve-month period ended September 30 exceeds the median net income to average shareholders’ equity ratio of all U.S. bank holding companies of similar asset size ($3 billion to $10 billion). A historically applied formula determines the amount, if any, by which Park’s return on equity ratio exceeds the median return on equity ratio of these peer bank holding companies. For the past several years, approximately 17% to 19% of any such excess amount on a before-tax equivalent basis has been approved for incentive compensation. If Park’s return on equity ratio is equal to or less than that of the peer group, no incentive compensation will be available with respect to that twelve-month period.

The computation of Park’s return on equity ratio for the 2008 Incentive Compensation Period reflected the inclusion of the net loss of Vision Bank for the 2008 Incentive Compensation Period adjusted for the goodwill impairment charges recorded during the 2008 Incentive Compensation Period. The Compensation Committee concluded that it was proper to add back the goodwill impairment charges in the aggregate amount of $109 million for the purpose of calculating the amount of Park’s net income for the 2008 Incentive Compensation Period, in order to provide a more reasonable view of Park’s operating performance and ensure comparability of operating performance not only from period to period but also with the peer bank holding companies.

For the 2008 incentive compensation paid in 2009, the Compensation Committee met on January 23, 2009 and reviewed management’s computation of the incentive compensation pool for the 2008 Incentive Compensation Period. Management recommended an amount for the Compensation Committee to consider that was a total equal to 17.2% of the amount by which Park’s return on equity ratio for the 2008 Incentive Compensation Period exceeded the median return on equity ratio of the peer bank holding companies (the “computed return on equity advantage”).

Management’s computation of the incentive compensation pool was $9.4 million for the 2008 Incentive Compensation Period, which was subsequently approved by the Compensation Committee. By comparison, the incentive compensation pool was $9.0 million for 2007, $9.8 million for 2006 and $11.2 million for both 2005 and 2004.

On January 23, 2009, the Compensation Committee determined that the incentive compensation awards to be paid to each of Messrs. DeLawder, Trautman and Kozak for the 2008 Incentive Compensation Period should remain the same as for the 2007 Incentive Compensation Period.

The executive compensation standards under The American Recovery and Reinvestment Act of 2009 (the “ARRA”) signed into law on February 17, 2009, to the extent applicable, prohibit Park for paying or accruing any bonus, retention or incentive compensation with respect to its five most highly-compensated employees or such higher number as the Secretary of the United States Department of the Treasury (the “U.S. Treasury”) may determine in the public interest, during the period in which any obligation arising from financial assistance provided under the U.S. Treasury’s Troubled Assets Relief Program remains outstanding, excluding any period during which the U.S. Treasury holds only warrants to purchase common shares of Park. To the extent that the U.S. Treasury amends the Securities Purchase Agreement with Park to make this prohibition applicable, the U.S. Treasury issues regulations describing how Park is to comply with this prohibition or Park determines that this prohibition applies, Park will work with its affected employees to take such steps as it deems necessary to comply with the prohibition and adopt administrative and other procedures consistent with the foregoing. Although it is unclear the extent to which the ARRA executive compensation standards apply to Park, Park has determined that it would be prudent not to pay the incentive compensation awards to Messrs. DeLawder, Trautman, Kozak and the other two most highly-compensated employees for the 2008 Incentive Compensation Period. In the event that the U.S. Treasury would later determine that Park is permitted to pay incentive compensation to its five most highly-compensated employees for 2008, the Compensation Committee has indicated that they would take action to authorize the 2008 incentive compensation payments for these five officers.

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EX-10.3B

Exhibit 10.3(b)

Schedule identifying Split-Dollar Agreements covering executive officers or employees of The
Park National Bank or one of its divisions who are also directors or executive officers of Park
National Corporation, which Split-Dollar Agreements are identical to the Split-Dollar
Agreement, dated May 17, 1993, between William T. McConnell and The Park National Bank

     The following individuals entered into the Split-Dollar Agreements identified below, which Split-Dollar Agreements are identical to the Split-Dollar Agreement, dated May 17, 1993, between William T. McConnell, Chairman of the Executive Committee of the Board of Directors and a director of each of Park and The Park National Bank (“Park National Bank”), and Park National Bank, filed as Exhibit 10(f) to Park’s Annual Report on Form 10-K for the fiscal year ended December 31, 1993 (File No. 0-18772):

		Subsidiary of Park
Name and Positions Held With Park	Date of Split-	which is Party to
and/or Principal Subsidiaries of Park	Dollar Agreement	Split-Dollar Agreement
C. Daniel DeLawder — Chairman of the Board, Chief Executive Officer and a director of each of Park and Park National Bank; a director of Vision Bank	May 26, 1993	Park National Bank
John W. Kozak — Chief Financial Officer of Park; Senior Vice President, Chief Financial Officer and a director of Park National Bank	June 2, 1993	Park National Bank
William A. Phillips — a director of Park; Chairman and a Member of the Advisory Board of Century National Bank, a division of Park National Bank	May 22, 1998	Park National Bank (as successor by merger to Century National Bank)
David L. Trautman — President, Secretary and a director of Park; President and a director of Park National Bank	September 23, 1993	Park National Bank

EX-10.7A

Exhibit 10.7(a)

Description of Park National Corporation
Supplemental Executive Retirement Benefits
as in effect from and after February 18, 2008

     Park National Corporation (“Park”) adopted the Park National Corporation Supplemental Executive Retirement Plan (the “SERP”) in December 1996. During the fiscal year ended December 31, 2008 (the “2008 fiscal year”), the SERP benefited 30 current and former officers of Park and Park’s subsidiaries, including: (a) William T. McConnell, who serves as Chairman of the Executive Committee of the Board of Directors of each of Park and The Park National Bank, a subsidiary of Park (“PNB”); (b) C. Daniel DeLawder, who serves as Chairman of the Board and Chief Executive Officer of each of Park and PNB; (c) David L. Trautman, who serves as President and Secretary of Park and President of PNB; and (d) John W. Kozak, who serves as Chief Financial Officer of Park and Senior Vice President and Chief Financial Officer of PNB. Each of the SERP participants, other than Mr. Trautman, had been a party to a Supplemental Executive Retirement Plan Agreement effective December 27, 1996 (a “1996 SERP Agreement”) with Park, which was amended and restated by an Amended and Restated Supplemental Executive Retirement Benefits Agreement (the “Amended SERP Agreement”) entered into with Park as of February 18, 2008, as discussed below. Mr. Trautman became a participant in the SERP and entered into a Supplemental Executive Retirement Benefits Agreement (the “Trautman SERP Agreement”) with Park effective as of February 18, 2008, as discussed below. Where the context is appropriate, the 1996 SERP Agreements, the Amended SERP Agreements and the Trautman SERP Agreement are referred to collectively as the “SERP Agreements” and individually as a “SERP Agreement.”

     The 1996 SERP Agreements represented unfunded, non-qualified benefit arrangements designed to restore benefits lost due to limitations under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), on the amount of compensation covered by and the benefits payable under the Park National Corporation Defined Benefit Pension Plan (the “Park Pension Plan”). Park and Park’s subsidiaries had no obligation to set aside any funds with which to pay their respective obligations under the 1996 SERP Agreements. The participants, their beneficiaries and any successors in interest were to be general creditors of Park and Park’s subsidiaries in the same manner as any other creditor having a general claim for matured and unpaid compensation.

     Park purchased split-dollar life insurance policies with respect to 26 of the participants in the SERP, including Messrs. DeLawder, Kozak and McConnell, in order to fund Park’s obligations under the 1996 SERP Agreement to which each such participant was a party. Those life insurance policies remain in effect in order to fund Park’s obligations under the related Amended SERP Agreements. Each life insurance policy also provides a life insurance benefit for the SERP participant to whom the policy relates if such SERP participant should die before age 84. The amount of this life insurance benefit is equal to the present value of the stream of future benefits which would have been paid to the SERP participant until age 84 but had not been paid at the time of the individual’s death. If the amount of this life insurance benefit were computed as of December 31, 2008, the life insurance benefit for Mr. DeLawder would have been approximately $2,129,604, the life insurance benefit for Mr. Kozak would have been approximately $35,778, and the life insurance benefit for Mr. McConnell would have been approximately $807,378.

     At its meeting on February 18, 2008, the Compensation Committee approved Amended SERP Agreements for the 30 current and former officers of Park and Park’s subsidiaries then participating in the SERP, including Messrs. DeLawder, Kozak and McConnell. Each Amended

SERP Agreement amended and restated the terms of the 1996 SERP Agreement to which each SERP participant was a party by changing the calculation of benefits payable to the SERP participant from a defined contribution (indexed) formula to a defined benefit formula. Due to the manner in which they were calculated, payments under the 1996 SERP Agreements had been quite variable in amount for the SERP participants from year to year — sometimes being much larger or sometimes being much smaller than the targeted amount. Under the Amended SERP Agreements, payments are to be made in the same amount each year. The present values of the future payments under the defined benefit formula provisions of the Amended SERP Agreements are projected to be the same as under the defined contribution (indexed) formula provisions of the 1996 SERP Agreements.

     Pursuant to each Amended SERP Agreement, a SERP participant is entitled to receive an annual supplemental retirement benefit (the “Full Benefit” as defined in his Amended SERP Agreement) beginning, subject to compliance with the requirements of Section 409A of the Internal Revenue Code, at age 62 (his “Payment Commencement Date”) and payable each year thereafter until the SERP participant’s death. The annual Full Benefit for each SERP participant under his Amended SERP Agreement is the same amount as the annual targeted benefit for the SERP participant under his 1996 SERP Agreement. Mr. DeLawder will be entitled to receive an annual Full Benefit of $127,900 beginning, subject to compliance with the requirements of Section 409A of the Internal Revenue Code, at age 62 in October of 2011. Mr. Kozak will be entitled to receive an annual Full Benefit of $3,900 beginning, subject to compliance with the requirements of Section 409A of the Internal Revenue Code, at age 62 in March of 2017. Mr. McConnell, who has reached age 62 and was receiving an annual targeted benefit under his 1996 SERP Agreement of $53,200, is entitled to continue receiving an annual Full Benefit under his Amended SERP Agreement of the same amount.

     At its meeting on February 18, 2008, the Compensation Committee also approved the Trautman SERP Agreement. The Trautman SERP Agreement represents an unfunded, non-qualified benefit arrangement designed to constitute a portion of aggregate retirement benefits for Mr. Trautman which would provide him with the equivalent of approximately 40% of his projected annual compensation at age 62. The 40% retirement benefit is computed by adding to the supplemental retirement benefit provided by the Trautman SERP Agreement: (i) the projected benefit for Mr. Trautman under the Park Pension Plan; (ii) the projected benefit for Mr. Trautman related to contributions made by Park to the Park National Corporation Employees Stock Ownership Plan (the “Park KSOP”) on Mr. Trautman’s behalf to match pre-tax elective deferral contributions made by him; and (iii) projected Social Security benefits to be received by Mr. Trautman. Under the Trautman SERP Agreement, Mr. Trautman will be entitled to receive an annual supplemental retirement benefit of $125,000 (his “Full Benefit”) beginning at age 62, subject to compliance with the requirements of Section 409A of the Internal Revenue Code, in March of 2023 (his “Payment Commencement Date”) and payable each year thereafter until his death.

     If a SERP participant separates from service (within the meaning of the Treasury regulations applicable to Section 409A of the Internal Revenue Code) with Park and Park’s subsidiaries for any reason prior to his Payment Commencement Date, he forfeits any right to payment under his SERP Agreement. Notwithstanding the foregoing, in the event that a SERP participant becomes substantially disabled (as defined in the SERP Agreements) while employed by Park or one of Park’s subsidiaries prior to his Payment Commencement Date, he will be entitled to receive a reduced benefit (the “Limited Benefit” as defined in his SERP Agreement), the amount of which varies depending on the year in which the SERP participant becomes substantially disabled. In the event a change in control occurs before a SERP participant

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experiences a separation from service with Park and Park’s subsidiaries, the SERP participant will become fully vested in his annual Full Benefit as though he remained continuously employed with Park or one of Park’s subsidiaries until his Payment Commencement Date, and payments will begin on his Payment Commencement Date as described above. For purposes of each SERP Agreement, a change in control is deemed to occur upon: (a) the execution of an agreement for the sale of all or a material portion of the assets of Park; (b) a merger or recapitalization in which Park is not the surviving entity; or (c) the acquisition of the beneficial ownership of 25% or more of the outstanding voting securities of Park by any person, trust, entity or group.

     If a SERP participant experiences a separation from service with Park and Park’s subsidiaries for cause (as defined in the SERP Agreements) or if Park determines, following a SERP participant’s Payment Commencement Date or the SERP participant’s becoming substantially disabled, that cause existed to terminate the SERP participant, his SERP Agreement will terminate and the SERP participant will forfeit any right to receive future payments and must return all payments previously made under his SERP Agreement within 30 days. In addition, a SERP participant will forfeit the right to receive future payments under his SERP Agreement if he violates certain non-competition, non-solicitation of customers and non-solicitation of employees covenants set forth in each SERP Agreement during a period of 12 months following his separation from service with Park and our subsidiaries.

     Each SERP Agreement terminates upon a SERP participant’s death.

     At its meeting on May 19, 2008, the Board of Directors of PNB approved a Split-Dollar Agreement (the “Trautman Split-Dollar Agreement”) between Mr. Trautman and PNB. Under the terms of the Trautman Split-Dollar Agreement, PNB owns the life insurance policy to which the Trautman Split-Dollar Agreement relates and controls all rights of ownership with respect to the policy. Mr. Trautman has the right to designate the beneficiary (beneficiaries) to whom a portion of the death proceeds of the policy are to be paid in accordance with the terms of the Trautman Split-Dollar Agreement. Upon Mr. Trautman’s death, his beneficiary (beneficiaries) will be entitled to an amount equal to the lesser of (a) the “Death Benefit” described in the Trautman Split-Dollar Agreement or (b) 100% of the difference between the total death proceeds payable under the policy and the cash surrender value of the policy (such difference being referred to as the “Net at Risk Amount”). The Death Benefit will be $1,342,000 if Mr. Trautman dies while a full-time employee of PNB until the later of age 62 or his retirement. If Mr. Trautman dies after retiring or attaining age 62, the Death Benefit will be reduced each year and will be $0 if Mr. Trautman dies after attaining age 84. In no event will the amount payable to Mr. Trautman’s beneficiary (beneficiaries) exceed the Net at Risk Amount in the policy as of the date of Mr. Trautman’s death. PNB will be entitled to any death proceeds payable under the policy remaining after payment to Mr. Trautman’s beneficiary (beneficiaries). PNB and Mr. Trautman’s beneficiary (beneficiaries) will share in any interest due on the death proceeds of the policy on a pro rata basis based upon the amount of proceeds due each party divided by the total amount of proceeds, excluding any such interest.

     To finalize Park’s participation in the U.S. Department of the Treasury’s Capital Purchase Program enacted as part of the Troubled Assets Relief Program (“TARP”) under the Emergency Economic Stabilization Act of 2008 (“EESA”), Park and the U.S. Treasury entered into a Letter Agreement, dated December 23, 2008 (the “Letter Agreement’), including the related Securities Purchase Agreement – Standard Terms attached thereto (the “Securities Purchase Agreement” and together with the Letter Agreement, the “UST Agreement”). The Securities Purchase Agreement prohibits Park from making any golden parachute payments to its named executive officers (Messrs. DeLawder, Trautman and Kozak). SERP payments to named

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executive officers may be considered to be golden parachute payments. Park and each named executive officer entered into a letter agreement in which the named executive officer agreed to amend the compensation and benefit plans of Park in which the named executive officer participates, including the SERP, to the extent necessary to give effect to these executive compensation limitations.

     The American Recovery and Reinvestment Act of 2009 (the “ARRA”) passed by the United States Congress and signed by the President on February 17, 2009 retroactively amends the executive compensation provisions applicable to participants in the Capital Purchase Program. The ARRA executive compensation standards prohibit any payment by Park to its Senior Executive Officers (as defined in the ARRA and which include Messrs. DeLawder, Trautman and Kozak) whose compensation is required to be disclosed pursuant to the Securities Exchange Act of 1934, as amended, and the next five most highly-compensated employees upon such employees’ departure. Park believes that this prohibition, if applicable, could prevent it from making SERP payments to these employees under the terms of the SERP as currently in effect. To the extent that the U.S. Treasury amends the Securities Purchase Agreement to make this prohibition applicable, the U.S. Treasury issues regulations describing how Park is to comply with this prohibition or Park determines that this prohibition applies, Park will work with its affected employees to take such steps as Park deems necessary to comply with the prohibition and adopt administrative and other procedures consistent with the foregoing.

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EX-10.11

Exhibit 10.11

Summary of Certain Compensation for
Directors of Park National Corporation

Annual Retainers and Meeting Fees

     Each director of Park National Corporation (“Park”) who is not an employee of Park or one of Park’s subsidiaries (a “non-employee director”) receives, on the date of the regular meeting of the Park Board of Directors held during the fourth fiscal quarter, an annual retainer in the form of 120 common shares of Park awarded under the Park National Corporation Stock Plan for Non-Employee Directors of Park National Corporation and Subsidiaries (the “Directors’ Stock Plan”).

     Each non-employee director receives $1,000 for each meeting of the Park Board of Directors attended and $400 for each meeting of a committee of the Park Board of Directors attended. If the date of a meeting of the full Board of Directors is changed from that provided for by resolution of the Board and a non-employee director is not able to attend the rescheduled meeting, he or she receives the meeting fee as though he or she attended the meeting.

     In addition, each member of the Executive Committee of the Park Board of Directors receives a $2,500 annual cash retainer and each member of the Audit Committee of the Park Board of Directors (other than the Chair) receives a $2,000 annual cash retainer. The Chair of the Audit Committee receives a $5,000 annual cash retainer.

     Each non-employee director of Park also serves on the board of directors of The Park National Bank, the national bank subsidiary of Park (“PNB”), or on the advisory board of one of PNB’s divisions, and receives, on the date of the regular meeting of the Park Board of Directors held during the fourth fiscal quarter, an annual retainer in the form of 60 common shares of Park awarded under the Directors’ Stock Plan and, in some cases, a specified amount of cash for such service as well as fees for attendance at meetings of the board of directors of PNB or the advisory board of the applicable division of PNB (and committees of the respective boards).

     In addition to the annual retainers and meeting fees discussed above, non-employee directors also receive reimbursement of all reasonable travel and other expenses of attending board and committee meetings.

     C. Daniel DeLawder, William T. McConnell, William A. Phillips and David L. Trautman receive no compensation for serving as members of the Board of Directors of Park or of any subsidiary of Park.

Other Compensation

     William T. McConnell is employed by PNB in a non-executive officer capacity. In such capacity, he received the amount of $33,000 during the fiscal year ended December 31, 2008 (the “2008 fiscal year). William A. Phillips is employed by Century National Bank, a division of PNB, in a non-executive officer capacity. In such capacity, he received the amount of $33,000 during the 2008 fiscal year.

EX-10.12

Exhibit 10.12

SECURITY NATIONAL BANK AND TRUST CO.
SECOND AMENDED AND RESTATED
1988 DEFERRED COMPENSATION PLAN

     PARK NATIONAL BANK, as successor to Security National Bank and Trust Co. (the “Bank”), established the 1988 Deferred Compensation Plan (the “Plan”) for the benefit of eligible officers and directors, effective June 30, 1988 and as amended and restated effective as of March, 1996. The Plan is hereby amended and restated again for the purpose of complying with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (“Code”) effective as of December 15, 2008 (“Restatement Effective Date”) as follows:

     Section 1. Administration. The Plan shall be administered by a committee designated for this purpose by the Board of Directors of the Bank. The term “Committee” as used in this Plan document and any amendments to it shall mean such committee. The Committee shall have full power to administer this Plan; and all determinations and actions of the Committee shall be made by a majority of its members.

     Section 2. Participation. Any director of the Bank and any officer of the Bank designated by the Committee shall be eligible to elect to become a “Participant” in this Plan; except that the Board of Directors of the Bank at any time and for any period may exclude any such individual from participating (other than with respect to amounts already credited or elected to be credited to his Deferred Compensation Account under this Plan). Any person who becomes a Participant shall become a former Participant upon termination of service with the Bank (or its Board of Directors) and receipt of the benefits to which he is entitled under the terms of this Plan. Notwithstanding the foregoing, any person who was participating in this Plan as of the Restatement Effective Date shall continue to be a Participant.

     Section 3. Annual Election. Each Participant may elect (a “Deferral Election”) in writing, in the manner prescribed by the Committee, on or before December 31 of each calendar year (or, in the case of a newly eligible person (as defined below), no later than thirty (30) days following the date such person first becomes a newly eligible person) (the “Deferral Election Date”), to defer the Bank’s payment to him of any percentage of salary, director’s fees or other compensation that will be earned by him during the immediately ensuing calendar year (or, in the case of any newly eligible person, after the date of such Person’s Deferral Election) (the “Service Period”); provided, however, that the minimum allowable deferral amount for any Service Period shall be an amount no less than $100 times the number of months in such Service Period. After the dates set forth above, a Deferral Election shall be irrevocable; and the deferred portion of the salary, director’s fees, or other compensation will not be paid to the Participant until the time or times prescribed in Section 9 below. At the time of making any Deferral Election, the Participant shall designate, in accordance with procedures specified by the Committee, the Eligible Investment (as defined in Section 6) or Eligible Investments in which the deferred amount shall be treated as having been invested in accordance with the options made available by the Committee as provided in Section 6. For purposes of this Section 3, a director or officer of the Bank is a “newly eligible person” only if such director or officer is not eligible to participate in any other plan or arrangement that would be aggregated with this Plan under Code Section 409A.

     Section 4. Deferred Compensation Accounts. The amounts deferred with respect to a Participant shall be credited, as specified in Section 5 and/or Section 6 below, to a “Deferred Compensation Account”, established within the Bank’s books and records on behalf of each Participant and reflecting all such amounts deferred by the Participant under this Plan.

     A Participant’s Deferred Compensation Account may consist of either or both Grandfathered Amounts and Section 409A Amounts. For purposes of this Section 4: (a) “Grandfathered Amounts” shall mean the portion, if any, of the Deferred Compensation Account that was earned and vested (within the meaning of Code Section 409A prior to January 1, 2005 and any earnings (whether actual or notional) attributable to such portion of the Deferred Compensation Account and any earnings (whether actual or notional) thereon; and (b) “Section 409A Amounts” shall mean the portion, if any, of the Deferred Compensation Account that does not consist of Grandfathered Amounts.

     Section 5. Credits to Deferred Compensation Accounts. All amounts credited to a Participant’s Deferred Compensation Account shall be treated as though invested and reinvested in one or more Eligible Investments designated by the Participant from time to time in accordance with procedures specified by the Committee. In addition, all dividends, interest, gains and distributions of any nature earned with respect to the Eligible Investment(s) in which a Participant’s Deferred Compensation Account is treated as being invested (collectively, “Earnings”) shall be credited to the Participant’s Deferred Compensation Account as though reinvested in the Eligible Investment with respect to which such Earnings were earned. A Participant’s Deferred Compensation Account also shall be reduced by the amount of any fees or expenses associated with the Eligible Investment(s) in which the account is treated as being invested. The Bank shall provide Participants with periodic reports showing the value of their Deferred Compensation Accounts, as adjusted to reflect fluctuations in the value of the Eligible Investments in which the account is treated as being invested and the addition of any Earnings credited to the account, at such times and in such format as the Committee shall determine.

     Section 6. Eligible Investments. The Committee from time to time may select one or more investment options (“Eligible Investments”) in which a Participant may elect to have amounts allocated to the Participant’s Deferred Compensation Account treated as being invested which may include, without limitation: (i) interest rates specified by, or determined in the manner specified by the Committee, (ii) a rate of return based upon the annual positive total rate of return on shares of common stock of Security Banc Corporation, (iii) an investment in hypothetical shares of common stock of Security Banc Corporation, and (iv) investments in securities, mutual funds, indexes or other investment vehicles or investment measures with readily determinable performance results which are offered by third parties. The Committee shall be under no obligation, however, to provide any Eligible Investment as an option or to continue to provide any Eligible Investment once provided. If the Committee does not provide for any Eligible Investment, all amounts in Participants’ Deferred Compensation Accounts shall be treated as if invested during each calendar year at a rate of interest which is one quarter of one percent (0.25%) greater than the average bond equivalent yield to maturity on one-year United States Treasury Bills in effect for the first five business days in the December immediately proceeding the calendar year (as published in The Wall Street Journal) or such alternate rate as may be set by the Committee for that year at least fifteen (15) days before the beginning of the year (the “Cash Deferral Rate”), and the Cash Deferral Rate shall be deemed to be the Eligible

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Investment for purposes of the other provisions of the Plan.

     Section 7. Investment Elections. If the Committee provides one or more Eligible Investments pursuant to Section 6, elections by Participants with respect to the Eligible Investment or Eligible Investments in which their Deferred Compensation Accounts shall be treated as being invested and changes in such elections shall be made at such time or times, with such prior notice, and in such manner, as the Committee may specify, subject to such limitations and restrictions as the Committee may provide. Unless the Committee otherwise provides, if a Participant fails to make an election with respect to all or any part of the Participant’s Deferred Compensation Account, the account shall be treated as having been invested at the Cash Deferral Rate.

     Section 8. Corresponding Investments by the Bank. In order to accumulate assets comparable to the Bank’s liability to Participants which accrues under the Plan, the Bank may, but in no event shall be required to, invest assets in such a manner as to correspond to the hypothetical investment elections made by Participants (other than with respect to any common stock of Security Banc Corporation, if such Investment Option is made available by the Committee or otherwise. Any such investment may be transferred to the Benefit Protection Trust established by the Bank. In no event, however, shall any Participant have any claim to or interest in any such investment by the Bank.

     Section 9. Distributions of Grandfathered Amounts.

     (a) A Participant shall receive payment of the Grandfathered Amounts credited to his Deferred Compensation Account following his termination of service with the Bank (or its Board of Directors) and, unless he has become disabled, his attainment of at least age 55 (early retirement age); except that if the service of a Participant with the Bank (or its Board of Directors) terminates before his 55th birthday, and if either the Participant elects (with or without consent of the Committee) to receive the lump sum payment described in this sentence or the Committee, in its sole discretion, determines that such lump-sum payment shall be made to the Participant with or without his consent, then within sixty (60) days after such election or determination there shall be paid in lump sum to the Participant, in full satisfaction of his rights under this Plan, the Participant’s Grandfathered Amounts minus all Earnings (as defined in Section 5) credited during the one (1) year period immediately preceding the date of such lump sum payment; provided, however, that the Committee, in its sole discretion, may waive all or part of such penalty in such cases as it deems appropriate. For these purposes a Participant shall be considered “disabled” if, because of physical, mental, or emotional reasons, he is unable to perform his normal duties for the Bank and in the Committee’s opinion such condition is likely to continue for at least one year.

     (b) Other than for the lump-sum payment with penalty described in Section 9(a) above, or the hardship distribution permitted in Section 9(e) below, all payments under this Plan shall be on account of the Participant’s retirement, and the form of payment shall be in lump sum (if consented to by the Participant), or in installments over a 5, 10 or 15-year period, as determined by the Committee in its sole and absolute discretion. If an installment method is selected, “interest” and/or “dividend” additions shall continue to be made to the unpaid portion of the Participant’s Deferred Compensation Account until such payment is completed.

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     (c) Payments under this Plan shall be made in cash.

     (d) In the event a Participant dies before his Grandfathered Amounts have fully distributed, any undistributed portion shall be paid to the beneficiary and in the manner he has designated under this Plan on a form provided by, and delivered to, the Committee, or if such beneficiary has not been properly designated or for any reason payment cannot be made to such beneficiary, then payment shall be made to the Participant’s estate. The determination of the Committee as to who is a proper payee of benefits hereunder shall be conclusive on all persons claiming under or through any Participant.

     (e) In the event a Participant, a former Participant, or a beneficiary of a deceased Participant demonstrates to the satisfaction of the Committee the existence of a serious financial hardship, the Committee, in its sole and absolute discretion, may direct an immediate payment of Grandfathered Amounts to such individual, with appropriate adjustment (without penalty) being made to the Participant’s, or former or deceased Participant’s, Grandfathered Amounts.

     (f) The Bank shall withhold from any payments under this Plan the amount of any taxes required to be withheld under federal, state or local law.

     Section 9A. Distributions of Section 409A Amounts.

     (a) A Participant shall receive payment of the Section 409A Amounts credited to his Deferred Compensation Account following his Separation from Service with the Bank (or its Board of Directors) and, unless he has become disabled, his attainment of at least age 55 (early retirement age); except that if the Participant Separates from Service with the Bank (or its Board of Directors) before his 55th birthday, the Committee, in its sole discretion, may distribute, in a single lump sum within sixty (60) days following such Separation from Service in full satisfaction of his rights under this Plan, the Participant’s Section 409A Amounts minus all Earnings (as defined in Section 5) credited during the one (1) year period immediately preceding the date of such lump sum payment; provided, however, that the Committee, in its sole discretion, may waive all or part of such penalty in such cases as it deems appropriate.

     For these purposes: (i) a Participant shall be considered “disabled” if, because of physical, mental, or emotional reasons, he is unable to perform his normal duties for the Bank and in the Committee’s opinion such condition is likely to continue for at least one (1) year; and (ii) a “Separation from Service” shall mean the Participant’s “separation from service” within the meaning of Code Section 409A from the Bank and all entities with whom the Bank would be treated as a single employer under Code Sections 414(b) and (c).

     (b) Other than for the Unforeseeable Emergency distribution permitted in Section 9A(e) below, all payments under this Plan shall be on account of the Participant’s Separation from Service, and the form of payment shall be in single lump sum, unless the Participant has elected to receive payment in installments. Any election by the Participant to receive payment in a form other than lump sum shall be made in accordance with Section 9A(g).

     (c) Payments under this Plan shall be made in cash.

     (d) In the event a Participant dies before his Section 409A Amounts have been fully

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distributed, any undistributed amounts shall be paid to the beneficiary and in the manner he has designated under this Plan on a form provided by, and delivered to, the Committee, or if such beneficiary has not been properly designated or for any reason payment cannot be made to such beneficiary, then payment shall be made to the Participant’s estate. The determination of the Committee as to who is a proper payee of benefits hereunder shall be conclusive on all persons claiming under or through any Participant.

     (e) A Participant may request a distribution from all or part of his Account upon the occurrence of an Unforeseeable Emergency. As a condition of receiving a distribution under this Section 9A(e), the Participant must file a written application with the Committee specifying the nature of the Unforeseeable Emergency, the amount needed to address the Unforeseeable Emergency and supplying any other information the Committee, in its discretion, may need to ensure that the conditions specified in this Section 9A(e) are satisfied. The Committee shall, in its sole discretion, determine whether an Unforeseeable Emergency exists and distribute an amount to the Participant which shall not be greater than the amount reasonably necessary to satisfy the emergency need (plus the amount necessary to pay any Federal, state, local or foreign income taxes or penalties reasonably anticipated to result from the distribution) or, if less, the value of the Participant’s Account as of the distribution date. A distribution on account of an Unforeseeable Emergency may not be made to the extent such emergency is or may be relieved through a cancellation of Deferrals under this Plan, reimbursement or compensation from insurance or otherwise, or by liquidation of the Participant’s assets, to the extent the liquidation of such assets would not cause a severe financial hardship.

     For purposes of this Section 9A(e), an “Unforeseeable Emergency” means a severe financial hardship to the Participant within the meaning of IRS Regulations §1.409A-3(i)(3) resulting from (a) an illness or accident of the Participant or the Participant’s spouse, Beneficiary or dependent (as defined in Code Section 152, without regard to Sections 152(b)(1), (b)(2) and (d)(1)(B) thereof), (b) loss of the Participant’s property due to casualty, or (c) other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant.

     (f) The Bank shall withhold from any payments under this Plan the amount of any taxes required to be withheld under federal, state or local law.

     (g) Notwithstanding the foregoing, a Participant may change the time or form of payment of Section 409A Amounts as follows:

     (i) Prior to December 31, 2008. On or before December 31, 2008, a Participant may change the time or form for payment of his Section 409A Amounts by describing the new time or form for payment in a writing submitted to the Bank before December 31, 2008; provided, however, that: (A) such election will not apply to any amount otherwise payable in 2008; and (B) such election may not cause an amount to be paid in 2008 that would not otherwise be payable in 2008. Such election must be made in the form prescribed by the Bank. After December 31, 2008, any election made pursuant to this Section 9A(g)(i) may be changed or revoked only as provided in Section 9A(g)(ii).

     (ii) After December 31, 2008. A Participant may change the time or form for

5

payment of his Section 409A Amount by describing the new time or form for payment in a writing submitted to the Bank; provided, however, that (A) any such change to an existing election may not take effect until at least twelve (12) months after the date on which the election is submitted; (B) the payment with respect to which such election is made must be deferred (other than due to death) for a period of at least five (5) years from the date such payment would otherwise have been made (or, in the case of installment payments treated as a single payment, five (5) years from the date the first amount was scheduled to be paid); and (C) any election affecting a distribution at a specified time must be made not less than twelve (12) months before the date the amount is scheduled to be paid (or, in the case of installment payments treated as a single payment, twelve (12) months before the date the first amount was scheduled to be paid).

     (h) Notwithstanding anything in this Plan to the contrary, in the event that the Participant is a “specified employee” (as defined in Code Section 409A) of the Bank (or of any entity with whom the Bank is treated as a single employer for purposes of Code Sections 414(b) and (c)), determined pursuant to the Bank’s (or such entity’s) policy for identifying specified employees, on the date of his Separation from Service, no payment on account of the Participant’s Separation from Service shall be made until the first day of the seventh month following the date of Separation from Service (or, if earlier, the date of his death). The cumulative amount paid on such day shall include any payments that could not be made during such period.

     Section 10. No Fund. Except as provided under the Benefit Protection Trust adopted by the Bank in connection with this Plan, the obligations under this Plan are those of the Bank only, and this Plan imposes no obligation on the Bank to provide for payment of benefits hereunder through any specific source or fund; and neither the Participant nor any person claiming under or through him shall have any interest in any specific asset or assets owned or held by the Bank by reason of this Plan.

     Section 11. No Assignment. To the extent permitted by law, none of the benefits payable hereunder shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or charge, and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber or charge shall be void; nor shall benefits be subject to the claims of creditors or others, nor to legal process.

     Section 12. Amendment and Termination. The Bank reserves the right, through action of its Board of Directors, from time to time to amend, supplement, or terminate this Plan in any manner it chooses, except that no amendment, supplement, or termination without the consent of a Participant shall affect the payment to him of any amount credited to his Deferred Compensation Account (or elected by him to be so credited) prior to the time he is given written notice by the Committee of the adoption of such amendment, supplement, or termination; and in the event the Plan is terminated, amounts credited to Deferred Compensation Accounts under the Plan will be distributed as provided in Section 9 until the last Participant has received distribution in full.

     Section 13. Claims Procedure. Any Participant or beneficiary who believe that he or she is entitled to an unpaid Plan benefit may file a claim with the Bank using the same

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procedures described in the Security National Bank and Trust Co. Amended and Restated Nonqualified Deferred Compensation Plan, as it may be amended from time to time.

     Section 14 Code Section 409A. This Plan is intended to comply with the requirements of Code Section 409A and the regulations promulgated thereunder, to the extent applicable, and, to the maximum extent permitted by law, shall be interpreted, administered and operated accordingly. Nothing herein shall be construed as an entitlement to or guarantee of any particular tax treatment to the Director, and none of the Bank, the Board of Directors of the Bank, the Committee or any other person shall have any liability with respect to any failure to comply with Code Section 409A. The Bank may accelerate the time or schedule of payment of the Participants’ Accounts at any time this Agreement fails to meet the requirements of Code Section 409A. Such payment may not exceed the amount required to be included in income as a result of the failure to comply with Code Section 409A.

     IN WITNESS WHEREOF, the Bank has caused this instrument to be executed by its officers hereunto duly authorized effective as of the Restatement Effective Date..

PARK NATIONAL BANK
By	/s/ David L. Trautman, Pres.
Name:	David L. Trautman
Title:	President

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EX-10.17B

Exhibit 10.17(b)

Schedule identifying
Non-Employee Directors of Park National Corporation
covered by
Split-Dollar Agreements, made and entered into effective as of December 28, 2007

     The following directors of Park National Corporation (“Park”) are covered by Split-Dollar Agreements (the “New Split-Dollar Agreements”) as identified below, which Split-Dollar Agreements are identical to the form of Split-Dollar Agreement, made and entered into effective as of December 28, 2007, filed as Exhibit 10.2(a) to Park’s Current Report on Form 8-K dated January 2, 2008 (File No. 1-13006):

	Subsidiary of Park which is a Party to	Date of New Split-
Name of Director	New Split-Dollar Agreement	Dollar Agreement
Maureen H. Buchwald	The Park National Bank (as successor by merger to The First-Knox National Bank of Mount Vernon)	December 28, 2007
James J. Cullers	The Park National Bank (as successor by merger to The First-Knox National Bank of Mount Vernon)	December 28, 2007
F. William Englefield IV	The Park National Bank	December 28, 2007
John J. O’Neill	The Park National Bank	December 28, 2007
J. Gilbert Reese	The Park National Bank	December 28, 2007
Rick R. Taylor	The Park National Bank (as successor by merger to The Richland Trust Company)	December 28, 2007
Leon Zazworsky	The Park National Bank	December 28, 2007

EX-12

Exhibit 12

COMPUTATION OF RATIOS

RETURN ON AVERAGE ASSETS	Net income/Average assets
RETURN ON AVERAGE EQUITY	Net income/Average stockholders’ equity
NET INTEREST MARGIN (computed on a fully taxable equivalent basis)	Fully taxable equivalent net interest income/Average earning assets
NONINTEREST EXPENSE EXCLUDING IMPAIRMENT CHARGE TO NET REVENUE (computed on a fully taxable equivalent basis) [Also referred to as EFFICIENCY RATIO BEFORE IMPAIRMENT CHARGE]	Total other expense (excluding goodwill impairment charge)/(Fully taxable equivalent net interest income plus total other income adjusted for gains or losses on sales of securities)
DIVIDEND PAYOUT RATIO	Dividends declared/Net income
AVERAGE STOCKHOLDERS’ EQUITY TO AVERAGE TOTAL ASSETS	Average stockholders’ equity/Average assets
AVERAGE COMMON STOCKHOLDERS’ EQUITY	Average stockholders’ equity less preferred stock
TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS	(Stockholders’ equity less goodwill and other intangible assets and preferred stock)/(Assets less goodwill and other intangible assets)
TIER 1 CAPITAL RATIO	(Stockholders’ equity less goodwill and other intangible assets and accumulated other comprehensive income (loss) plus qualifying trust preferred securities (“Tier 1 capital”))/Risk-adjusted assets
RISK-BASED CAPITAL RATIO	(Tier 1 capital plus qualifying loan loss allowance and subordinated debt)/Risk-adjusted assets
LEVERAGE RATIO	Tier 1 capital/(Average total assets less goodwill and other intangible assets)
BOOK VALUE PER SHARE	Total stockholders’ equity/Common shares outstanding at year-end
ALLOWANCE FOR LOAN LOSSES TO END OF YEAR LOANS	Allowance for loan losses/Gross loans net of unearned interest
NET CHARGE-OFFS TO AVERAGE LOANS	Net charge-offs/Average gross loans net of unearned interest
NONPERFORMING LOANS TO LOANS	(Nonaccrual loans plus loans past due 90 days or greater plus renegotiated loans)/Gross loans net of unearned interest
NONPERFORMING ASSETS TO LOANS	(Nonaccrual loans plus loans past due 90 days or greater plus renegotiated loans plus other real estate owned)/Gross loans net of unearned interest
NONPERFORMING ASSETS TO TOTAL ASSETS	(Nonaccrual loans plus loans past due 90 days or greater plus renegotiated loans plus other real estate owned)/Total assets
RETURN ON AVERAGE EQUITY BEFORE IMPAIRMENT CHARGE	(Net income plus goodwill impairment charge)/Average stockholders’ equity
RETURN ON AVERAGE ASSETS BEFORE IMPAIRMENT CHARGE	(Net income plus goodwill impairment charge)/Average assets
RETURN ON AVERAGE COMMON EQUITY	Net income available to common shareholders/(stockholders’ equity less preferred stock)
RETURN ON AVERAGE COMMON EQUITY BEFORE IMPAIRMENT CHARGE	(Net income available to common shareholders plus goodwill impairment charge)/(stockholders’ equity less preferred stock)

Computation of Ratio of Earnings to Fixed Charges

The following table shows the ratio of earnings to fixed charges for Park, which includes our subsidiaries, on a consolidated basis:

	For the Year Ended December 31,
	2008		2007		2006		2005		2004
Ratio of earnings to fixed charges (1):
Excluding interest on deposits		1.77		2.12		4.36		4.61		7.80
Including interest on deposits		1.26		1.31		2.09		2.44		3.19

(1) For purposes of computing the ratios, earnings consist of income before income taxes and fixed charges. Fixed charges consist of interest on borrowings and long-term debt, including/excluding interest on deposits, and one-third of rental expense, which Park National Corporation believes is representative of the interest factor.

Earnings:
Income before income taxes	$	35,719,000	$	52,677,000	$	133,077,000	$	135,424,000	$	129,249,000
Fixed Charges:
Interest on deposits	$	89,892,000	$	121,021,000	$	82,272,000	$	56,899,000	$	39,998,000
Borrowings and long-term debt	$	45,574,000	$	46,126,000	$	39,043,000	$	36,996,000	$	18,704,000
Rent expense interest factor (1/3)	$	801,147	$	731,723	$	530,030	$	476,528	$	303,595
Total Fixed Charges:
Including interest on deposits	$	136,267,147	$	167,878,723	$	121,845,030	$	94,371,528	$	59,005,595
Excluding interest on deposits	$	46,375,147	$	46,857,723	$	39,573,030	$	37,472,528	$	19,007,595

Computation of Ratio of Earnings to Fixed Charges and Preferred Dividends

The following table shows the ratio of earnings to fixed charges and preferred dividends for Park, which includes our subsidiaries, on a consolidated basis:

	For the Year Ended December 31,
	2008		2007		2006		2005		2004
Ratio of earnings to fixed charges and preferred dividends (1):
Excluding interest on deposits		1.77		2.12		4.36		4.61		7.80
Including interest on deposits		1.26		1.31		2.09		2.44		3.19

(1) For purposes of computing the ratios, earnings consist of income before income taxes and fixed charges. Fixed charges consist of interest on borrowings and long-term debt, including/excluding interest on deposits, preferred dividends and one-third of rental expense, which Park National Corporation believes is representative of the interest factor.

Earnings:
Income before income taxes	$	35,719,000	$	52,677,000	$	133,077,000	$	135,424,000	$	129,249,000
Fixed Charges:
Interest on deposits	$	89,892,000	$	121,021,000	$	82,272,000	$	56,899,000	$	39,998,000
Borrowings and long-term debt	$	45,574,000	$	46,126,000	$	39,043,000	$	36,996,000	$	18,704,000
Preferred dividends	$	202,857		N/A		N/A		N/A		N/A
Rent expense interest factor (1/3)	$	801,147	$	731,723	$	530,030	$	476,528	$	303,595
Total Fixed Charges:
Including interest on deposits	$	136,470,004	$	167,878,723	$	121,845,030	$	94,371,528	$	59,005,595
Excluding interest on deposits	$	46,578,004	$	46,857,723	$	39,573,030	$	37,472,528	$	19,007,595

EX-13

Exhibit 13

FINANCIAL REVIEW

This financial review presents management’s discussion and analysis of the financial condition and results of operations for Park National Corporation (“Park” or the “Corporation”). This discussion should be read in conjunction with the consolidated financial statements and related notes and the five-year summary of selected financial data. Management’s discussion and analysis contains forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance. The forward-looking statements are based on management’s expectations and are subject to a number of risks and uncertainties. Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include, without limitation, Park’s ability to execute its business plan, Park’s ability to successfully integrate acquisitions into Park’s operations, Park’s ability to achieve the anticipated cost savings and revenue synergies from acquisitions, Park’s ability to convert its Ohio-based community banking divisions to one operating system, changes in general economic and financial market conditions, deterioration in credit conditions in the markets in which Park’s subsidiary banks operate, changes in interest rates, changes in the competitive environment, changes in banking regulations or other regulatory or legislative requirements affecting the respective businesses of Park and its subsidiaries, changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies, demand for loans in the respective market areas served by Park and its subsidiaries, and other risk factors relating to our industry as detailed from time to time in Park’s reports filed with the Securities and Exchange Commission (“SEC”) including those described in “Item 1A. Risk Factors” of Part I of Park’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008. Undue reliance should not be placed on the forward-looking statements, which speak only as of the date of this Annual Report. Park does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward-looking statement was made, or reflect the occurrence of unanticipated events, except to the extent required by law.

ACQUISITION OF VISION BANCSHARES, INC. AND GOODWILL IMPAIRMENT CHARGES

On March 9, 2007, Park acquired all of the stock and outstanding stock options of Vision Bancshares, Inc. (“Vision”) for $87.8 million in cash and 792,937 shares of Park common stock valued at $83.3 million or $105.00 per share. The goodwill recognized was $109.0 million. The fair value of the acquired assets of Vision was $686.5 million and the fair value of the liabilities assumed was $624.4 million as of March 9, 2007.

At the time of the acquisition, Vision operated two bank subsidiaries (both named Vision Bank) which became bank subsidiaries of Park on March 9, 2007. On July 20, 2007, the bank operations of the two Vision Banks were consolidated under a single charter through the merger of the Vision Bank headquartered in Gulf Shores, Alabama with and into the Vision Bank headquartered in Panama City, Florida. Vision Bank operates under a Florida banking charter and has 18 branch locations in Baldwin County, Alabama and in the Florida panhandle. The markets that Vision Bank operates in are expected to grow faster than many of the non-metro markets in which Park’s subsidiary banks operate in Ohio. Management expects that the acquisition of Vision will improve the future growth rate for Park’s loans and deposits. However, the acquisition of Vision had a significant negative impact on Park’s net income in 2007 and 2008.

Vision Bank began experiencing credit problems during the second half of 2007 as nonperforming loans increased from $6.5 million at June 30, 2007 to $63.5 million or 9.9% of loan balances at December 31, 2007. As a result of these credit problems at Vision Bank, Park’s management concluded that the goodwill of $109.0 million recorded at the time of acquisition was possibly impaired. A goodwill impairment analysis was completed during the fourth quarter of 2007 and the conclusion was reached that a goodwill impairment charge of $54.0 million be recorded at Vision Bank at year-end 2007 to reduce the goodwill balance to $55.0 million.

Credit problems continued to plague Vision Bank in 2008. Net loan charge-offs for Vision Bank were $5.5 million during the first quarter or an annualized 3.37% of average loans and increased to $10.8 million during the second quarter or an annualized 6.41% of average loans. Based primarily on the increased level of net loan charge-offs at Vision Bank during the second quarter of 2008, management determined that it would be prudent to test for additional goodwill impairment. A goodwill impairment analysis was completed during the third quarter of 2008 and the conclusion was reached that a goodwill impairment charge of $55.0 million be recorded at Vision Bank during the third quarter to eliminate the goodwill balance pertaining to Vision Bank.

OVERVIEW

Net income for 2008 was $13.7 million, compared to $22.7 million for 2007 and $94.1 million for 2006. Net income decreased by 39.6% in 2008 compared to 2007 and decreased by 75.9% in 2007 compared to 2006. The primary reason for the much lower net income in 2008 and 2007 was the net loss at Vision Bank of $81.2 million in 2008 and $60.7 million from the date of the acquisition (March 9, 2007) through December 31, 2007. As previously discussed, Vision Bank recognized goodwill impairment charges of $55.0 million in 2008 and $54.0 million in 2007.

Diluted earnings per common share were $.97, $1.60 and $6.74 for 2008, 2007 and 2006, respectively. Diluted earnings per common share decreased by 39.4% in 2008 compared to 2007 and decreased by 76.3% in 2007 compared to 2006.

The following tables show the components of net income for 2008, 2007 and 2006. This information is provided for Park, Vision Bank and Park excluding Vision Bank.

Park — Summary Income Statements
(For the years ended December 31, 2008, 2007 and 2006)

(In thousands)	2008		2007		2006
Net interest income	$	255,873	$	234,677	$	213,244
Provision for loan losses		70,487		29,476		3,927
Other income		84,834		71,640		64,762
Other expense		179,515		170,129		141,002
Goodwill impairment charge		54,986		54,035		—
Income before taxes		35,719		52,677		133,077
Income taxes		22,011		29,970		38,986
Net income	$	13,708	$	22,707	$	94,091

Vision Bank — Summary Income Statements
(For the years ended December 31, 2008 and 2007)

(In thousands)	2008			2007
Net interest income	$	27,065		$	23,756
Provision for loan losses		46,963			19,425
Other income		3,014			3,465
Other expense		27,149			18,545
Goodwill impairment charge		54,986			54,035
Loss before taxes		(99,019	)		(64,784	)
Income taxes		(17,832	)		(4,103	)
Net loss	$	(81,187	)	$	(60,681	)

Park acquired Vision Bank on March 9, 2007 and the summary income statement for 2007 includes the results from the date of acquisition through year-end 2007. No comparable results are listed for Vision Bank for 2006.

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FINANCIAL REVIEW

Vision Bank began experiencing credit problems during the third quarter of 2007 and the credit problems continued throughout 2008. Vision’s net loan charge-offs were $38.5 million in 2008 and $8.6 million in 2007. As a percentage of average loans, net loan charge-offs were 5.69% in 2008 and an annualized 1.71% in 2007. These severe credit problems resulted in recognition of the goodwill impairment charges of $55.0 million in 2008 and $54.0 million in 2007.

Park Excluding Vision Bank — Summary Income Statements
(For the years ended December 31, 2008, 2007 and 2006)

(In thousands)	2008		2007		2006
Net interest income	$	228,808	$	210,921	$	213,244
Provision for loan losses		23,524		10,051		3,927
Other income		81,820		68,175		64,762
Other expense		152,366		151,584		141,002
Goodwill impairment charge		—		—		—
Income before taxes		134,738		117,461		133,077
Income taxes		39,843		34,073		38,986
Net income	$	94,895	$	83,388	$	94,091

Net income for Park excluding Vision Bank increased by $11.5 million or 13.8% in 2008 compared to 2007 and decreased by $10.7 million or 11.4% in 2007 compared to 2006.

SUMMARY DISCUSSION OF OPERATING RESULTS FOR PARK

A year ago, Park’s management projected that net interest income would be $240 million to $242 million in 2008. The actual results in 2008 of $255.9 million exceeded the top of the estimated range by $13.9 million or 5.7%.

Park’s management also projected a year ago that the provision for loan losses would be approximately $20 million to $25 million and that the net loan charge-off ratio would be approximately .45% to .55% in 2008. We included the following statement with this projection: “This estimate could change significantly as circumstances for individual loans and economic conditions change.” Indeed, economic conditions did change significantly as the economy in the United States moved into a severe recession. The provision for loan losses for 2008 was $70.5 million and exceeded the top of the estimated range by $45.5 million or 181.9%. The net loan charge-off ratio for 2008 was 1.32% and exceeded the top of the estimated range by .77% or 140.0%.

Other income for 2008 was $84.8 million and exceeded the year ago estimated amount of $77.4 million by $7.4 million or 10.0%. The other income for 2008 included some “one-time” items that on a net basis added approximately $13.3 million to other income in 2008. The positive “one-time” items included $3.1 million of income recognized as a result of the initial public offering of Visa, Inc. and an aggregate of $11.8 million of income recognized from the sale of the unsecured credit card portfolio and from the sale of the merchant processing business. Fee income was reduced by a write-down in mortgage loan servicing rights of $1.6 million which resulted from the sharp decrease in long-term interest rates on fixed rate residential mortgage loans. The net positive impact on other income from these “one-time” items was approximately $13.3 million.

A year ago, Park’s management projected that total other expense would be approximately $177 million in 2008. Total other expense (excluding the goodwill impairment charge of $55.0 million) was $179.5 million and exceeded management’s estimate by $2.5 million or 1.4%.

In summary, the actual results for net interest income, other income and other expense (excluding goodwill impairment charges) exceeded the estimated projections from a year ago by $13.9 million, $7.4 million and $2.5 million, respectively. The net positive impact on income before taxes from these variances was a positive $18.8 million. However, due to severe economic conditions the provision for loan losses exceeded the estimate from a year ago by $45.5 million and an additional goodwill impairment charge of $55.0 million was recognized at Vision Bank.

ISSUANCE OF PREFERRED STOCK AND EMERGENCY ECONOMIC STABILIZATION ACT

On October 3, 2008, Congress passed the Emergency Economic Stabilization Act of 2008 (“EESA”), which creates the Troubled Asset Relief Program (“TARP”) and provides the Secretary of the Treasury with broad authority to implement certain actions to help restore stability and liquidity to U.S. markets. The Capital Purchase Program (the “CPP”) was announced by the U.S. Department of the Treasury (the “U.S. Treasury”) on October 14, 2008 as part of TARP. Pursuant to the CPP, the U.S. Treasury will purchase up to $250 billion of senior preferred shares on standardized terms from qualifying financial institutions. The purpose of the CPP is to encourage U.S. financial institutions to build capital to increase the flow of financing to U.S. businesses and consumers and to support the U.S. economy.

The CPP is voluntary and requires a participating institution to comply with a number of restrictions and provisions, including standards for executive compensation and corporate governance and limitations on share repurchases and the declaration and payment of dividends on common shares.

Eligible financial institutions could generally apply to issue preferred shares to the U.S. Treasury in aggregate amounts between 1% to 3% of the institution’s risk-weighted assets. Park was eligible to apply to the U.S. Treasury for between approximately $47 million and $141 million of funding. Park elected to apply for $100 million of funds though the CPP and its application was approved on December 1, 2008.

On December 23, 2008, Park completed the sale to the Treasury of $100.0 million of newly issued Park non-voting preferred shares as part of the CPP. Park entered into a Securities Purchase Agreement and a Letter Agreement with the U.S. Treasury on December 23, 2008. Pursuant to these agreements, Park issued and sold to the U.S. Treasury: (i) 100,000 of Park’s Fixed Rate Cumulative Perpetual Preferred Shares, Series A, each without par value and having a liquidation preference of $1,000 per share (the “Series A Preferred Shares”); and (ii) a warrant (the “Warrant”) to purchase 227,376 Park common shares at an exercise price of $65.97 per share, for an aggregate purchase price of $100.0 million. The Warrant has a ten-year term. All of the proceeds from the sale of the Series A Preferred Shares and the Warrant by Park to the U.S. Treasury under the CPP will qualify as Tier 1 capital for regulatory purposes.

The $100 million in proceeds from the issuance of the preferred shares and related warrant are being used to help fund an increase in loan balances. U.S. generally accepted accounting principles require management to allocate the proceeds from the issuance of the Series A preferred stock between the Series A preferred stock and related warrant. The terms of the preferred shares require management to pay a cumulative dividend at the rate of 5 percent per annum for the first five years and 9 percent thereafter. Management has determined that the 5 percent dividend rate is below market value; therefore, the fair value of the preferred shares would be less than the $100 million in proceeds. Management determined that a reasonable market discount rate is 12 percent for the fair value of preferred shares. Management used the Black-Scholes model for calculating the fair value of the warrant (and related common shares). The allocation between the preferred shares and warrant at December 23, 2008, the date of issuance, was $95.7 million and $4.3 million, respectively. The discount on the preferred shares of $4.3 million will be accreted through retained earnings using the level yield method over a 60-month period. SFAS No. 128 “Earnings Per Share” requires Park to measure earnings per share with earnings available to common shareholders. Therefore, the Consolidated Statements of Income reflect a line item called “Income Available to Common Shareholders.” For the year ended December 31, 2008, in arriving at Income Available to Common Shareholders, net income of $13,708,000 has been reduced by $142,000, which reflects the impact of the accrual of the 5 percent dividend on the preferred shares and the accretion on the discount for the nine days they were outstanding during 2008. For the twelve months ended December 31, 2009, the total amount of Preferred Stock Dividends that will reduce net income in arriving at Income Available to Common Shareholders

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will be $5,761,000, which includes $761,000 of accretion on the discount of the preferred shares.

See Note 1 and Note 25 of the Notes to Consolidated Financial Statements for additional information on the issuance of preferred stock.

DIVIDENDS ON COMMON SHARES

Park declared quarterly cash dividends on common shares in 2008 that totaled $3.77 per share. The quarterly cash dividend on common shares was $.94 per share for the first three quarters of 2008 and increased to $.95 per share for the fourth quarter.

Under the terms of the Securities Purchase Agreement with the U.S. Treasury under the CPP, Park is not permitted to increase the quarterly cash dividend on its common shares above $.94 per share without seeking prior approval from the U.S. Treasury.

Cash dividends declared on common shares were $3.77 in 2008, $3.73 in 2007 and $3.69 in 2006. Park’s management expects to pay a quarterly cash dividend on common shares of $.94 per quarter in 2009.

CONSOLIDATION OF OHIO BANKING CHARTERS

On July 30, 2007, Park announced a plan to review current processes and identify opportunities to improve efficiency by converting to one operating system. One outcome of this initiative (“Project EPS”) was the consolidation of the eight banking charters of Park’s Ohio-based subsidiary banks into one national bank charter, The Park National Bank (“PNB”), during the third quarter of 2008. PNB operates with twelve banking divisions. See Table 1 for a complete listing of the banking divisions.

BRANCH PURCHASE AND BANK ACQUISITION

On September 21, 2007, a national bank subsidiary of Park, The First-Knox National Bank of Mount Vernon (“FKNB”), acquired the Millersburg, Ohio banking office (the “Millersburg branch”) of Ohio Legacy Bank, N.A. (“Ohio Legacy”). FKNB acquired substantially all of the loans administered at the Millersburg branch of Ohio Legacy and assumed substantially all of the deposit liabilities relating to the deposit accounts assigned to the Millersburg branch. The fair value of the loans acquired was approximately $38.3 million and the fair value of the deposit liabilities assumed was approximately $23.5 million.

FKNB paid a premium of approximately $1.7 million in connection with the purchase of the deposit liabilities. FKNB recognized a loan premium adjustment of $700,000 and a certificate of deposit adjustment of $300,000, resulting in the recording of a core deposit intangible of $2.7 million. No goodwill was recognized as part of this transaction. In addition, FKNB paid $900,000 for the acquisition of the branch office building that Ohio Legacy was leasing from a third party.

On December 18, 2006, Park acquired Anderson Bank Company (“Anderson”) of Cincinnati, Ohio for $17.7 million in a cash and stock transaction. Park paid the shareholders of Anderson aggregate consideration consisting of $9.052 million in cash and 86,137 common shares of Park valued at $8.665 million. Anderson merged with Park’s subsidiary bank, PNB. Anderson’s two offices are being operated as part of the operating division of PNB known as The Park National Bank of Southwest Ohio & Northern Kentucky (“PSW”). The fair value of the acquired assets of Anderson was $69.7 million and the fair value of the liabilities assumed was $62.6 million at December 18, 2006. The goodwill recognized as a result of this acquisition was $10.6 million.

CRITICAL ACCOUNTING POLICIES

The significant accounting policies used in the development and presentation of Park’s consolidated financial statements are listed in Note 1 of the Notes to Consolidated Financial Statements. The accounting and reporting policies of Park conform with U.S. generally accepted accounting principles and general practices within the financial services industry. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from those estimates.

Park considers that the determination of the allowance for loan losses involves a higher degree of judgment and complexity than its other significant accounting policies. The allowance for loan losses is calculated with the objective of maintaining a reserve level believed by management to be sufficient to absorb probable incurred credit losses in the loan portfolio. Management’s determination of the adequacy of the allowance for loan losses is based on periodic evaluations of the loan portfolio and of current economic conditions. However, this evaluation is inherently subjective as it requires material estimates, including expected default probabilities, the loss given default, the amounts and timing of expected future cash flows on impaired loans, and estimated losses on consumer loans and residential mortgage loans based on historical loss experience and the current economic conditions. All of those factors may be susceptible to significant change. To the extent that actual results differ from management estimates, additional loan loss provisions may be required that would adversely impact earnings for future periods.

Management’s assessment of the adequacy of the allowance for loan losses considers individual impaired loans, pools of homogeneous loans with similar risk characteristics and other environmental risk factors. This assessment is updated on a quarterly basis. The allowance established for individual impaired loans, in accordance with SFAS No. 114, as amended by SFAS No. 118, reflects expected losses resulting from analyses developed through specific credit allocations for individual loans. The specific credit allocations are based on regular analyses of commercial, commercial real estate and construction loans where the internal credit rating is at or below a predetermined classification. These analyses involve a high degree of judgment in estimating the amount of loss associated with specific impaired loans. For the years ended December 31, 2008, 2007 and 2006, management has allocated $8.7 million, $3.4 million and $2.0 million, respectively, to individually impaired loans.

Pools of homogeneous loans with similar risk characteristics are also assessed for probable losses. A loss migration analysis is performed on certain commercial, commercial real estate loans and construction loans. These are loans above a fixed dollar amount that are assigned an internal credit rating. Generally, residential real estate loans and consumer loans are not individually graded. The amount of loan loss reserve assigned to these loans, under SFAS No. 5, is dependent on their net charge-off history and other qualitative factors.

Management also evaluates the impact of environmental qualitative factors which pose additional risks and assigns a component of the allowance for loan losses in consideration of these factors. Such environmental factors include: national and local economic trends and conditions; experience, ability and depth of lending management and staff; effects of any changes in lending policies and procedures; levels of, and trends in, consumer bankruptcies, delinquencies, impaired loans and charge-offs and recoveries. The determination of this component of the allowance for loan losses requires considerable management judgment.

Park’s recent adoption of SFAS No. 157 (See Note 21 of the Notes to Consolidated Financial Statements) on January 1, 2008 required management to establish a fair value hierarchy, which has the objective of maximizing the use of observable market inputs. SFAS No. 157 also requires enhanced disclosures regarding the inputs used to calculate fair value. These inputs are classified as Level 1, 2, and 3. Level 3 inputs are those with significant unobservable inputs that reflect a company’s own assumptions about the market for a particular instrument. Some of the inputs could be based on internal models and cash flow analysis. At December 31, 2008, financial assets valued using Level 3 inputs for Park had an aggregate fair value of approximately $78.6 million. This was 4.8% of the total amount of assets measured at fair value as of the end of the year. The fair value of impaired loans was approximately $75.9 million (or 97%) of the total amount of Level 3 inputs. The large majority of Park’s financial assets valued using Level 2 inputs consist of available-for-sale

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(“AFS”) securities. The fair value of these AFS securities is obtained largely by the use of matrix pricing, which is a mathematical technique widely used in the financial services industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities.

Management believes that the accounting for goodwill and other intangible assets also involves a higher degree of judgment than most other significant accounting policies. SFAS No. 142, “Goodwill and Other Intangible Assets,” establishes standards for the amortization of acquired intangible assets and the impairment assessment of goodwill. Goodwill arising from business combinations represents the value attributable to unidentifiable intangible assets in the business acquired. Park’s goodwill relates to the value inherent in the banking industry and that value is dependent upon the ability of Park’s banking subsidiaries to provide quality, cost-effective banking services in a competitive marketplace. The goodwill value is supported by revenue that is in part driven by the volume of business transacted. A decrease in earnings resulting from a decline in the customer base, the inability to deliver cost-effective services over sustained periods or significant credit problems can lead to impairment of goodwill that could adversely impact earnings in future periods. SFAS No. 142 requires an annual evaluation of goodwill for impairment, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The fair value of the goodwill, which resides on the books of Park’s subsidiary banks, is estimated by reviewing the past and projected operating results for the Park subsidiary banks, deposit and loan totals for the Park subsidiary banks and banking industry comparable information.

During the three months ended September 30, 2008, Park’s management determined that the credit conditions at Vision Bank had further deteriorated and that an impairment analysis of the goodwill balance at Vision Bank was required. As a result of this impairment analysis, Vision Bank recorded a goodwill impairment charge of $55.0 million during the third quarter of 2008, which eliminated the goodwill asset at Vision Bank. Previously, Vision Bank recorded a goodwill impairment charge of $54.0 million during the fourth quarter of 2007 which had reduced the goodwill balance carried on the books of Vision Bank to $55.0 million from the original goodwill asset of $109.0 million.

At December 31, 2008, on a consolidated basis, Park had core deposit intangibles of $13.2 million subject to amortization and $72.3 million of goodwill, which was not subject to periodic amortization. The core deposit intangibles recorded on the balance sheet of Park National Bank totaled $4.4 million and the core deposit intangibles at Vision Bank were $8.8 million. The goodwill asset of $72.3 million is carried on the balance sheet of Park National Bank.

ABOUT OUR BUSINESS

Through its Ohio-based banking divisions, Park is engaged in the commercial banking and trust business, generally in small to medium population Ohio communities and through Vision Bank in Baldwin County, Alabama and in the Florida panhandle. Management believes there is a significant number of consumers and businesses which seek long-term relationships with community-based financial institutions of quality and strength. While not engaging in activities such as foreign lending, nationally syndicated loans and investment banking operations, Park attempts to meet the needs of its customers for commercial, real estate and consumer loans, consumer and commercial leases, and investment, fiduciary and deposit services.

Park’s subsidiaries compete for deposits and loans with other banks, savings associations, credit unions and other types of financial institutions. At December 31, 2008, Park and its Ohio-based banking divisions operated 128 offices and a network of 147 automatic teller machines in 29 Ohio counties and one county in northern Kentucky. Vision Bank operated 18 offices and a network of 21 automatic teller machines in Baldwin County, Alabama and in 6 counties in the panhandle of Florida.

A table of financial data of Park’s subsidiaries and banking divisions for 2008, 2007 and 2006 is shown below. See Note 23 of the Notes to Consolidated Financial Statements for additional information on the Corporation’s subsidiaries. Please note that the financial statements for various divisions of PNB are not maintained on a separate basis and therefore net income is only an estimate by management.

Table 1 — Park National Corporation Affiliate Financial Data

	2008						2007						2006
	Average			Net			Average			Net			Average			Net
(In thousands)	Assets			Income			Assets			Income			Assets			Income
Park National Bank:
Park National Division	$	1,839,012		$	25,445		$	1,492,652		$	24,830		$	1,503,420		$	26,577
Fairfield National Division		337,355			7,332			332,564			6,322			338,183			6,457
Park National SW & N KY Division		416,398			1,506			398,517			(69	)		288,189			1,331
Richland Trust Division		526,989			8,946			529,175			5,915			496,481			7,987
Century National Division		711,162			12,995			720,781			11,913			719,864			10,149
First-Knox National Division		658,151			12,718			656,406			10,891			639,969			11,406
Farmers & Savings Division		119,014			2,042			129,133			2,292			132,222			2,308
United Bank Division		214,074			3,467			207,493			2,410			218,358			2,537
Second National Division		423,062			5,752			403,114			4,847			386,139			4,705
Security National Division		670,041			10,748			685,718			10,609			766,298			11,931
Unity National Division		190,739			2,061			192,382			1,290			190,751			986
Citizens National Division		150,530			2,253			150,083			1,830			166,611			1,854
Vision Bank		904,420			(81,187	)		698,788			(60,681	)		—			—
Parent Company, including consolidating entries		(452,861	)		(370	)		(427,650	)		308			(465,862	)		5,863
Consolidated Totals	$	6,708,086		$	13,708		$	6,169,156		$	22,707		$	5,380,623		$	94,091

SOURCE OF FUNDS

Deposits: Park’s major source of funds is provided by core deposits from individuals, businesses and local government units. These core deposits consist of all noninterest bearing and interest bearing deposits, excluding certificates of deposit of $100,000 and over and deposits obtained through the use of brokers. Core deposits were 78.1% of total deposits at year-end 2008, compared to 85.5% at year-end 2007 and 88.2% at year-end 2006.

Total year-end deposits increased by $323 million or 7.3% in 2008. However, $236 million of the growth in deposits came from the use of broker deposits. Excluding the broker deposits, total year-end deposits increased by $87 million or 2.0%. In 2008, Vision Bank’s year-end total deposits decreased by $20 million or 3.1% and the Ohio-based banking division increased deposits by $107 million or 2.8%.

In 2007, year-end total deposits increased by $13 million or .3% exclusive of the $577 million of deposits that were acquired in the Vision acquisition and exclusive of the $23 million in deposits that were acquired in the purchase of the Millersburg, Ohio branch office. During 2007, the deposits of Vision Bank increased by approximately $80 million or 13.8% from the date of acquisition (March 9, 2007) through year-end. By comparison, the deposits for Park’s Ohio-based banks decreased by $67 million or 1.7% during 2007.

Average total deposits were $4,603 million in 2008 compared to $4,403 million in 2007 and $3,825 million in 2006. Average noninterest bearing deposits were $740 million in 2008 compared to $697 million in 2007 and $662 million in 2006.

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Management expects that total deposits (excluding broker deposits) will increase by a modest amount (1% to 2%) in 2009. Emphasis will continue to be placed on increasing noninterest bearing deposits and controlling the cost of interest bearing deposits. The growth in year-end deposits in 2008 (excluding broker deposits) was 2.0%, which was consistent with the growth guidance of 1% to 2% that was provided a year ago by Park’s management.

The Federal Open Market Committee (“FOMC”) of the Federal Reserve Board decreased the federal funds rate from 4.25% at December 31, 2007 to a range of 0% to .25% at year-end 2008. The average federal funds rate for 2008 was 1.93%, compared to an average rate of 5.02% in 2007 and 4.97% in 2006. The FOMC aggressively lowered the federal funds during 2008 as the severity of the economic recession increased.

The average interest rate paid on interest bearing deposits was 2.33% in 2008, compared to 3.27% in 2007 and 2.60% in 2006. The average cost of interest bearing deposits was 2.00% for the fourth quarter of 2008, compared to 2.17% for the third quarter of 2008, 2.34% for the second quarter of 2008 and 2.83% for the first quarter of 2008.

Park’s management expects that due to the severe economic recession, the FOMC will maintain the federal funds interest rate at .25% or so for most of 2009. As a result, Park’s management expects a further decrease in the average interest rate paid on interest bearing deposits in 2009.

Short-Term Borrowings: Short-term borrowings consist of securities sold under agreements to repurchase, Federal Home Loan Bank advances, federal funds purchased and other borrowings. These funds are used to manage the Corporation’s liquidity needs and interest rate sensitivity risk. The average rate paid on short-term borrowings generally moves closely with changes in market interest rates for short-term investments. The average rate paid on short-term borrowings was 2.38% in 2008 compared to 4.47% in 2007 and 4.18% in 2006.

The average cost of short-term borrowings was 1.82% for the fourth quarter of 2008, compared to 2.13% for the third quarter, 2.23% for the second quarter and 3.34% for the first quarter. Management expects a significant reduction in the average rate paid on short-term borrowings in 2009, as a result of the decrease in the federal funds rate in the fourth quarter of 2008.

Average short-term borrowings were $609 million in 2008 compared to $494 million in 2007 and $375 million in 2006. The increase in short-term borrowings in 2008 compared to 2007 was primarily used to help fund the increase in loans and investments. The increase in short-term borrowings in 2007 compared to 2006 was primarily due to the acquisition of Vision on March 9, 2007. Park paid $87.8 million in cash as part of the consideration for the acquisition of Vision.

Long-Term Debt: Long-term debt primarily consists of borrowings from the Federal Home Loan Bank and repurchase agreements with investment banking firms. The average rate paid on long-term debt was 3.72% for 2008 and 4.22% for both 2007 and 2006. The average cost of long-term debt was 3.46% for the fourth quarter of 2008, compared to 3.68% for the third quarter, 3.79% for the second quarter and 4.00% for the first quarter. (The average balance of long-term debt and the average cost of long-term debt includes the subordinated debentures discussed in the following section.)

In 2008, average long-term debt was $836 million compared to $569 million in 2007 and $553 million in 2006. Average total debt (long-term and short-term) was $1,445 million in 2008 compared to $1,063 million in 2007 and $929 million in 2006. Average total debt increased by $382 million or 35.9% in 2008 compared to 2007 and increased by $134 million or 14.4% in 2007 compared to 2006. The large increase in average total debt in 2008 was used to fund the large increase in average loans and investments. In 2007, the increase in total debt was primarily used to fund the acquisition of Vision.

Average long-term debt was 58% of average total debt in 2008 compared to 54% in 2007 and 60% in 2006.

Subordinated Debentures: Park assumed with the Vision acquisition $15 million of a floating rate subordinated debenture. The interest rate on this subordinated debenture adjusts every quarter at 148 basis points above the three-month LIBOR interest rate. The maturity date on the debenture is December 30, 2035 and the subordinated debenture may be prepaid after December 30, 2010. This subordinated debenture qualifies as Tier 1 capital under Federal Reserve Board guidelines.

Park’s Ohio-based banking subsidiary (PNB) issued a $25 million subordinated debenture on December 28, 2007. The interest rate on this subordinated debenture adjusts every quarter at 200 basis points above the three-month LIBOR interest rate. The maturity date on the subordinated debenture is December 29, 2017 and the subordinated debenture may be prepaid after December 28, 2012. On January 2, 2008, Park entered into a “pay fixed-receive floating” interest rate swap agreement for a notional amount of $25 million with a maturity date of December 28, 2012. This interest rate swap agreement was designed to hedge the cash flows pertaining to the $25 million subordinated debenture until December 28, 2012. Management converted the cash flows to a fixed interest rate of 6.01% through the use of the interest rate swap. This subordinated debenture qualifies as Tier 2 capital under the applicable regulations of the Office of the Comptroller of the Currency of the United States of America (the “OCC”) and the Federal Reserve Bank.

See Note 11 of the Notes to Consolidated Financial Statements for additional information on the subordinated debentures.

Stockholders’ Equity: Tangible stockholders’ equity (stockholders’ equity less goodwill and other intangible assets) to tangible assets (total assets less goodwill and other intangible assets) was 7.98% at December 31, 2008 compared to 6.85% at December 31, 2007 and 9.13% at December 31, 2006.

The large increase in the ratio of tangible stockholders’ equity to tangible assets was due to the issuance of $100.0 million of Park non-voting preferred shares to the U.S. Treasury on December 23, 2008. Excluding the $100.0 million of preferred stock, the ratio of tangible stockholders’ equity to tangible assets ratio was 6.54% at December 31, 2008.

In 2007, the large decrease in the ratio of tangible stockholders’ equity to tangible assets was primarily due to the purchase of treasury stock during 2007 and to the acquisition of Vision. Park purchased 760,531 treasury shares in 2007 at an average price of $86.21 per share for a total cost of $65.6 million. As part of the Vision acquisition, Park issued 792,937 shares of Park common stock valued at a price of $105.00 per share for a total value of $83.3 million. Vision Bank had a net loss of $60.7 million in 2007 and ended that year with goodwill and intangible assets of $65.9 million.

In accordance with SFAS No. 115, Park reflects any unrealized holding gain or loss on AFS securities, net of income taxes, as accumulated other comprehensive income (loss) which is part of Park’s equity. The unrealized holding gain on AFS securities, net of income taxes, was $31.6 million at year-end 2008, compared to an unrealized holding gain on AFS securities, net of income taxes of $1.0 million at year-end 2007 and an unrealized holding loss on AFS securities, net of income taxes of ($16.0) million at year-end 2006. Long-term and short-term interest rates decreased sharply during the fourth quarter of 2008 which caused the market value of Park’s investment securities to increase and produced the large unrealized holding gain on AFS securities, net of income taxes, at year-end 2008.

In accordance with SFAS No. 158, Park adjusts accumulated other comprehensive income (loss) to recognize the net actuarial loss related to the accounting for Park’s defined benefit pension plan. See Note 13 of the Notes to Consolidated Financial Statements for information on the accounting for Park’s defined benefit pension plan.

34

FINANCIAL REVIEW

During 2008, Park recognized a net comprehensive loss of ($16.2) million pertaining to the accounting for Park’s pension plan. At year-end 2007, the balance in accumulated other income (loss) pertaining to the pension plan was a loss of ($3.6) million. As a result, the balance in accumulated other comprehensive income (loss) pertaining to the pension plan was a loss of ($19.8) million at December 31, 2008. The large adjustment in 2008 was primarily due to the negative investment return on pension plan assets in 2008, as a result of the poor performance of stock investments in 2008. Park also recognized in 2008 a net comprehensive loss of ($1.3) million due to the mark to market of the $25 million cash flow hedge. See Note 19 of the Notes to Consolidated Financial Statements for information on the accounting for Park’s derivative instruments.

INVESTMENT OF FUNDS

Loans: Average loans, net of unearned income, were $4,355 million in 2008 compared to $4,011 million in 2007 and $3,357 million in 2006. The average yield on loans was 6.93% in 2008 compared to 8.01% in 2007 and 7.61% in 2006. The average prime lending rate in 2008 was 5.09% compared to 8.05% in 2007 and 7.96% in 2006. Approximately 64% of loan balances mature or reprice within one year (see Table 10). This results in the interest rate yield on the loan portfolio adjusting with changes in interest rates, but on a delayed basis. Management expects that the yield on the loan portfolio will decrease in 2009 as a result of the sharp decrease in market interest rates during the fourth quarter of 2008.

In 2008, year-end loan balances, net of unearned income, increased by $267 million or 6.3%. During the fourth quarter of 2008, Park’s Ohio-based banking divisions sold $31 million of unsecured credit card balances. Exclusive of the sale of the credit card balances, year-end loan balances grew by $298 million or 7.0%. At Vision Bank, year-end loan balances increased by $51 million or 8.0% during 2008 to $690 million. Park’s Ohio-based subsidiaries increased loans by $216 million or 6.0% during 2008. Excluding the sale of the credit card balances, Park’s Ohio-based subsidiaries increased loans by $247 million or 6.9% in 2008.

By comparison, Park’s Ohio-based subsidiaries increased loans by 1.9% in 2007, 3.0% in 2006 and 1.7% in 2005. The much stronger loan growth in Ohio in 2008 was primarily due to customers changing their banking relationship to Park from other banks.

Year-end loan balances, net of unearned income, increased by $110 million or 3.2% in 2007 exclusive of $596 million of loans that were acquired in the Vision acquisition and exclusive of the $38 million of loans that were acquired as part of the Millersburg, Ohio branch purchase. From the date of the Vision acquisition (March 9, 2007) through year-end 2007, Vision Bank increased loans by $43 million to $639 million at year-end 2007. Excluding the growth from Vision Bank, Park’s Ohio-based subsidiary banks grew loans by $67 million during 2007 for a growth rate of 1.9%.

In 2006, year-end loan balances, net of unearned income, increased by $100 million or 3.0% in 2006 exclusive of $53 million of loans that were acquired in the Anderson acquisition. Loans increased by $52 million or 1.7% in 2005 exclusive of $161 million of loans that were acquired in the First Clermont acquisition and $5 million of loans that were included in the sale of the Roseville branch office.

A year ago, management projected that year-end loan balances would grow between 2% to 3% in 2008. The actual loan growth of 6.3% (7.0%, excluding the sale of credit cards) was much stronger than anticipated. Management expects that loan growth for 2009 will be slower at about 3% to 4%, due to the weakness in the economy.

Year-end residential real estate loans were $1,560 million, $1,481 million and $1,300 million in 2008, 2007 and 2006, respectively. Residential real estate loans increased by $79 million or 5.3% during 2008. In 2007, residential real estate loans increased by $43 million or 3.3% exclusive of the $138 million of loans from the Vision acquisition. In 2006, residential real estate loans decreased by $15 million exclusive of the $28 million of loans from the Anderson acquisition. Management expects growth of 2% to 3% in residential real estate loans in 2009.

The long-term fixed-rate residential mortgage loans that Park originates are sold in the secondary market and Park retains the servicing on these loans. The balance of sold fixed-rate mortgage loans was $1,369 million at year-end 2008 compared to $1,403 million at year-end 2007 and $1,405 million at year-end 2006. Vision Bank does not retain servicing on residential real estate loans sold in the secondary market and as a result, has had no impact on Park’s servicing portfolio. Management expects that the balance of sold fixed-rate mortgage loans will increase by 3% to 4% in 2009 as a result of the decrease in long-term interest rates in the fourth quarter of 2008 and the first quarter of 2009.

Year-end consumer loans were $643 million, $593 million and $532 million in 2008, 2007 and 2006, respectively. Consumer loans increased by $50 million or 8.4% in 2008 and increased by $55 million or 10.3% in 2007 exclusive of the $6 million of consumer loans acquired from the Vision acquisition. In 2006, consumer loans increased by $35 million or 7.1% exclusive of the $2 million of loans from the Anderson acquisition. The increases in consumer loans for 2008, 2007 and 2006 were primarily due to an increase in auto -mobile loans originated through automobile dealers in Ohio. Management expects that consumer loans will increase by 4% to 5% in 2009.

On a combined basis, year-end construction loans, commercial loans and commercial real estate loans totaled $2,284 million, $2,143 million and $1,638 million at year-end 2008, 2007 and 2006, respectively. These combined loan totals increased by $141 million or 6.6% in 2008 with most of the increase ($101 million) coming from commercial loans. In 2007, these combined loan totals increased by $33 million or 2.0% exclusive of the $472 million of loans acquired through the Vision acquisition and the Millersburg branch purchase. In 2006, these combined loan totals increased by $86 million or 5.6% exclusive of $23 million of loans from the Anderson acquisition. Management expects that construction loans, commercial loans and commercial real estate loans will grow by 3% to 4% in 2009.

Year-end lease balances were $4 million, $7 million and $10 million in 2008, 2007 and 2006, respectively. Management continues to de-emphasize leasing and expects the balance to further decline in 2009.

Table 2 reports year-end loan balances by type of loan for the past five years.

Table 2 — Loans by Type

December 31,
(In thousands)	2008		2007		2006		2005		2004
Commercial, financial and agricultural	$	714,296	$	613,282	$	548,254	$	512,636	$	469,382
Real estate — construction		533,788		536,389		234,988		193,185		155,326
Real estate — residential		1,560,198		1,481,174		1,300,294		1,287,438		1,190,275
Real estate — commercial		1,035,725		993,101		854,869		823,354		752,428
Consumer, net of unearned income		643,507		593,388		532,092		494,975		505,151
Leases, net of unearned income		3,823		6,800		10,205		16,524		48,046
Total Loans	$	4,491,337	$	4,224,134	$	3,480,702	$	3,328,112	$	3,120,608

Table 3 — Selected Loan Maturity Distribution

			Over One		Over
December 31, 2008	One Year		Through		Five
(In thousands)	or Less		Five Years		Years		Total
Commercial, financial and agricultural	$	358,058	$	207,740	$	148,498	$	714,296
Real estate — construction		446,220		36,868		50,700		533,788
Real estate — commercial		220,381		102,282		713,062		1,035,725
Total	$	1,024,659	$	346,890	$	912,260	$	2,283,809
Total of these selected loans due after one year with:
Fixed interest rate							$	469,301
Floating interest rate							$	789,849

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FINANCIAL REVIEW

Investment Securities: Park’s investment securities portfolio is structured to provide liquidity and contribute to earnings. Park’s investment strategy is dynamic. As conditions change over time, Park’s overall interest rate risk, liquidity needs and potential return on the investment portfolio will change. Management regularly evaluates the securities in the investment portfolio as circumstances evolve. Circumstances that may precipitate a sale of a security would be to better manage interest rate risk, to meet liquidity needs or to improve the overall yield on the investment portfolio.

Park classifies most of its securities as AFS (see Note 4 of the Notes to Consolidated Financial Statements). These securities are carried on the books at their estimated fair value with the unrealized holding gain or loss, net of federal taxes, accounted for as accumulated other comprehensive income (loss) which is part of the Corporation’s equity. The securities that are classified as available-for-sale are free to be sold in future periods in carrying out Park’s investment strategies.

Average taxable investment securities were $1,756 million in 2008, compared to $1,531 million in 2007 and $1,533 million in 2006. The average yield on taxable securities was 5.00% in 2008, compared to 5.03% in 2007 and 4.91% in 2006. Average tax-exempt investment securities were $45 million in 2008, compared to $65 million in 2007 and $77 million in 2006. The average tax-equivalent yield on tax-exempt investment securities was 6.90% in 2008, compared to 6.68% in 2007 and 6.84% in 2006.

Year-end total investment securities (at amortized cost) were $2,010 million in 2008, $1,702 million in 2007 and $1,538 million in 2006. Management purchased investment securities totaling $693 million in 2008, $843 million in 2007 and $167 million in 2006. Proceeds from repayments and maturities of investment securities were $310 million in 2008, $712 million in 2007 and $313 million in 2006. Proceeds from sales of available-for-sale securities were $81 million in 2008 and $304,000 in 2006. Park realized net security gains of $1.1 million in 2008 and $97,000 in 2006. Park did not sell any investment securities in 2007.

At year-end 2008 and 2007, the average tax-equivalent yield on the total investment portfolio was 5.01% and 5.13%, respectively. The weighted average remaining maturity was 2.9 years at December 31, 2008 and 3.7 years at December 31, 2007. U.S. Government Agency asset-backed securities were approximately 88% of the total investment portfolio at year-end 2008 and were approximately 81% of the total investment portfolio at year-end 2007. This segment of the investment portfolio consists of 15-year mortgage-backed securities and collateralized mortgage obligations.

During 2008, management purchased approximately $270 million of U.S. Government Agency collateralized mortgage obligations and classified these securities at the time of purchase as held-to-maturity. The U.S. Government Agency collateralized mortgage obligations are not as liquid as U.S. Government Agency mortgage-backed securities and as such management generally classifies the purchase of collateralized mortgage obligations as held-to-maturity.

The average maturity of the investment portfolio would lengthen if long-term interest rates would increase as the principal repayments from mortgage-backed securities and collateralized mortgage obligations would be reduced. At year-end 2008, management estimated that the average maturity of the investment portfolio would lengthen to 4.1 years with a 100 basis point increase in long-term interest rates and to 4.6 years with a 200 basis point increase in long-term interest rates. Likewise, the average maturity of the investment portfolio would shorten if long-term interest rates would decrease as the principal repayments from mortgage-backed securities and collateralized mortgage obligations would increase as borrowers would refinance their mortgage loans. At year-end 2008, management estimated that the average maturity of the investment portfolio would decrease to 2.0 years with a 100 basis point decrease in long-term interest rates and to 1.3 years with a 200 basis point decrease in long-term interest rates.

The following table sets forth the carrying value of investment securities at year-end 2008, 2007 and 2006:

Table 4 — Investment Securities

December 31,
(In thousands)	2008		2007		2006
Obligations of U.S. Treasury and other U.S. Government agencies	$	128,688	$	203,558	$	90,709
Obligations of states and political subdivisions		37,188		59,052		70,090
U.S. Government asset-backed securities and other asset-backed securities		1,822,587		1,375,005		1,288,969
Other securities		70,588		65,488		63,730
Total	$	2,059,051	$	1,703,103	$	1,513,498

Included in “Other Securities” in Table 4, are Park’s investments in Federal Home Loan Bank stock and Federal Reserve Bank stock. At December 31, 2008, Park owned $61.9 million of Federal Home Loan Bank Stock and $6.9 million of Federal Reserve Bank stock. Park owned $56.8 million of Federal Home Loan Bank stock and $6.4 million of Federal Reserve Bank stock at year-end 2007. At December 31, 2006, Park owned $55.5 million of Federal Home Loan Bank stock and $6.4 million of Federal Reserve Bank stock. The fair values of these investments are the same as their amortized costs.

ANALYSIS OF EARNINGS

Park’s principal source of earnings is net interest income, the difference between total interest income and total interest expense. Net interest income results from average balances outstanding for interest earning assets and interest bearing liabilities in conjunction with the average rates earned and paid on them. (See Table 5 for three years of history on the average balances of the balance sheet categories and the average rates earned on interest earning assets and the average rates paid on interest bearing liabilities.)

Net interest income increased by $21.2 million or 9.0% to $255.9 million for 2008 compared to an increase of $21.4 million or 10.1% to $234.7 million for 2007. The tax equivalent net yield on interest earning assets was 4.16% for 2008 compared to 4.20% for 2007 and 4.33% for 2006. The net interest rate spread (the difference between rates received for interest earning assets and the rates paid for interest bearing liabilities) was 3.82% for 2008, compared to 3.68% for 2007 and 3.80% for 2006. The increase in net interest income in 2008 was primarily due to the large increase in average interest earning assets of $546 million or 9.7% and an increase in the net interest spread to 3.82% from 3.68% in 2007. In 2007, the increase in net interest income was primarily due to the large increase in average interest earning assets of $649 million or 13.0% which resulted from the acquisition of Vision on March 9, 2007.

The average yield on interest earning assets was 6.37% in 2008 compared to 7.18% in 2007 and 6.77% in 2006. On a quarterly basis for 2008, the average yield on earning assets was 5.99% for the fourth quarter, 6.25% for the third quarter, 6.40% for the second quarter and 6.83% for the first quarter. The FOMC of the Federal Reserve Board decreased the targeted federal funds rate from 4.25% at year-end 2007 to a range of 0% to .25% at year-end 2008. The average federal funds rate for 2008 was 1.93%, compared to an average rate of 5.02% in 2007 and 4.97% in 2006. Management expects that the average yield on interest earning assets will decrease in 2009 due to reductions in market interest rates in the fourth quarter of 2008.

The average rate paid on interest bearing liabilities was 2.55% in 2008, compared to 3.50% in 2007 and 2.97% in 2006. On a quarterly basis for 2008, the average rate paid on interest bearing liabilities was 2.21% for the fourth quarter, 2.42% for the third quarter, 2.55% for the second quarter and 3.07% for the first quarter. Management expects that the average rate paid on interest bearing liabilities will decrease in 2009 due to reductions in market interest rates in the fourth quarter of 2008.

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FINANCIAL REVIEW

Table 5 — Distribution of Assets, Liabilities and Stockholders’ Equity

	2008								2007								2006
December 31,	Daily					Average			Daily					Average			Daily					Average
(Dollars in thousands)	Average			Interest		Rate			Average			Interest		Rate			Average			Interest		Rate
ASSETS
Interest earning assets:
Loans (1) (2)	$	4,354,520		$	301,926		6.93	%	$	4,011,307		$	321,392		8.01	%	$	3,357,278		$	255,641		7.61	%
Taxable investment securities		1,755,879			87,711		5.00	%		1,531,144			77,016		5.03	%		1,533,310			75,300		4.91	%
Tax-exempt investment securities (3)		45,420			3,134		6.90	%		65,061			4,346		6.68	%		77,329			5,288		6.84	%
Money market instruments		15,502			295		1.90	%		17,838			920		5.16	%		8,723			469		5.38	%
Total interest earning assets		6,171,321			393,066		6.37	%		5,625,350			403,674		7.18	%		4,976,640			336,698		6.77	%
Noninterest earning assets:
Allowance for possible loan losses		(86,485	)							(78,256	)							(70,386	)
Cash and due from banks		143,151								151,219								142,794
Premises and equipment, net		69,278								61,604								46,894
Other assets		410,821								409,239								284,681
TOTAL	$	6,708,086							$	6,169,156							$	5,380,623
LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest bearing liabilities:
Transaction accounts	$	1,364,635		$	19,509		1.43	%	$	1,318,764		$	35,919		2.72	%	$	1,058,323		$	22,508		2.13	%
Savings deposits		585,505			3,124		0.53	%		553,407			3,878		0.70	%		573,067			3,362		0.59	%
Time deposits		1,912,640			67,259		3.52	%		1,834,060			81,224		4.43	%		1,531,477			56,402		3.68	%
Total interest bearing deposits		3,862,780			89,892		2.33	%		3,706,231			121,021		3.27	%		3,162,867			82,272		2.60	%
Short-term borrowings		609,219			14,469		2.38	%		494,160			22,113		4.47	%		375,332			15,692		4.18	%
Long-term debt		835,522			31,106		3.72	%		568,575			24,013		4.22	%		553,307			23,351		4.22	%
Total interest bearing liabilities		5,307,521			135,467		2.55	%		4,768,966			167,147		3.50	%		4,091,506			121,315		2.97	%
Noninterest bearing liabilities:
Demand deposits		739,993								697,247								662,077
Other		92,607								84,185								81,966
Total noninterest bearing liabilities		832,600								781,432								744,043
Stockholders’ equity		567,965								618,758								545,074
TOTAL	$	6,708,086							$	6,169,156							$	5,380,623
Net interest earnings				$	257,599							$	236,527							$	215,383
Net interest spread							3.82	%							3.68	%							3.80	%
Net yield on interest earning assets							4.16	%							4.20	%							4.33	%

(1)	Loan income includes loan related fee income of $4,650 in 2008, $5,935 in 2007 and $4,340 in 2006. Loan income also includes the effects of taxable equivalent adjustments using a 35% tax rate in 2008, 2007 and 2006. The taxable equivalent adjustment was $763 in 2008, $565 in 2007 and $518 in 2006.
(2)	For the purpose of the computation, nonaccrual loans are included in the daily average loans outstanding.
(3)	Interest income on tax-exempt investment securities includes the effects of taxable equivalent adjustments using a 35% tax rate in 2008, 2007 and 2006. The taxable equivalent adjustments were $963 in 2008, $1,285 in 2007 and $1,621 in 2006.

The following table displays (for each quarter of 2008) the average balance of interest earning assets, net interest income and the tax equivalent net yield on interest earning assets.

	Average Interest		Net Interest		Tax Equivalent
(In thousands)	Earning Assets		Income		Net Interest Margin
First Quarter	$	5,941,570	$	61,484		4.19	%
Second Quarter		6,189,218		64,326		4.20	%
Third Quarter		6,251,883		65,228		4.17	%
Fourth Quarter		6,313,986		64,835		4.11	%
2008	$	6,171,321	$	255,873		4.16	%

Management expects that average interest earnings assets will be approximately $6,400 million for 2009 as the expected growth in loan balances from year-end will be offset by a similar decrease in investment securities. Management expects that net interest income will be $258 to $263 million in 2009 and that the tax equivalent net interest margin will be approximately 4.08% in 2009. (Please see the “Summary Discussion of Operating Results for Park” section of this “Financial Review” for a comparison of 2008 results to management’s projections from a year ago.)

The change in interest due to both volume and rate has been allocated to volume and rate changes in proportion to the relationship of the absolute dollar amounts of the change in each.

Table 6 — Volume/Rate Variance Analysis

	Change from 2007 to 2008									Change from 2006 to 2007
(In thousands)	Volume			Rate			Total			Volume			Rate			Total
Increase (decrease) in:
Interest income:
Total loans	$	26,080		$	(45,546	)	$	(19,466	)	$	51,780		$	13,971		$	65,751
Taxable investments		11,160			(465	)		10,695			(107	)		1,823			1,716
Tax-exempt investments		(1,351	)		139			(1,212	)		(821	)		(121	)		(942	)
Money market instruments		(107	)		(518	)		(625	)		471			(20	)		451
Total interest income		35,782			(46,390	)		(10,608	)		51,323			15,653			66,976
Interest expense:
Transaction accounts	$	1,204		$	(17,614	)	$	(16,410	)	$	6,309		$	7,102		$	13,411
Savings accounts		217			(971	)		(754	)		(116	)		632			516
Time deposits		3,351			(17,316	)		(13,965	)		12,218			12,604			24,822
Short-term borrowings		4,345			(11,989	)		(7,644	)		5,267			1,154			6,421
Long-term debt		10,204			(3,111	)		7,093			662			0			662
Total interest expense		19,321			(51,001	)		(31,680	)		24,340			21,492			45,832
Net variance	$	16,461		$	4,611		$	21,072		$	26,983		$	(5,839	)	$	21,144

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FINANCIAL REVIEW

Other Income: Total other income, exclusive of security gains or losses, increased by $12.1 million or 16.9% to $83.7 million in 2008 compared to an increase of $7.0 million or 10.8% to $71.6 million in 2007. In 2008, Park’s total other income was positively impacted by two “one-time” items totaling $14.9 million and was negatively impacted by the write-down of the mortgage loan servicing asset of $1.6 million. The net impact from the three items had a positive impact of $13.3 million on total other income. The “one-time” positive items were $3.1 million of revenue recognized as a result of the initial public offering of Visa, Inc. and an aggregate of $11.8 million of revenue which resulted from the sale of the unsecured credit card balances and the sale of the merchant processing business. The large increase in 2007 was primarily due to the acquisition of Vision on March 9, 2007. Excluding Vision Bank’s total other income of $3.5 million, the increase was $3.5 million or 5.4% to $68.2 million in 2007. A year ago, management had projected that total other income for 2008 would be approximately $77 million.

The following table displays total other income for Park in 2008, 2007 and 2006.

Year Ended December 31
(Dollars in thousands)	2008		2007		2006
Income from fiduciary activities	$	13,937	$	14,403	$	13,548
Service charges on deposits		24,296		23,813		19,969
Net gains on sales of securities		1,115		—		97
Other service income		8,882		11,543		10,920
Other		36,604		21,881		20,228
Total other income	$	84,834	$	71,640	$	64,762

Income from fiduciary activities decreased by $466,000 or 3.2% to $13.9 million in 2008. This decrease was primarily due to the poor performance of the equity markets in 2008, as the market value of trust assets being managed decreased throughout the year. In 2007, income from fiduciary activities increased by $855,000 or 6.3% to $14.4 million. The increase in 2007 was primarily due to growth in the number of customers being serviced. Management expects a decrease of approximately 7% in fee income from fiduciary activities in 2009. Fiduciary fees are charged based on the market value of the assets being managed and the market values declined somewhat during the last four months of 2008.

Service charges on deposit accounts increased by $483,000 or 2.0% to $24.3 million in 2008. In 2007, service charges on deposit accounts increased by $3.8 million or 19.2% to $23.8 million. The increase in service charges on deposits in 2007 (exclusive of Vision Bank) was $2.2 million or 11.1%. Park introduced a courtesy overdraft program in 2006 which helped generate an 11.9% increase in service charges in 2006 and contributed to the strong increase in services charges on deposits in 2007. The revenue produced by the courtesy overdraft program has plateaued and Park’s management expects another small increase in service charges on deposits of approximately 2% in 2009.

Fee income earned from the origination and sale into the secondary market of long-term fixed-rate mortgage loans is included with other non-yield related loan fees in the subcategory “Other service income.” Other service income decreased by $2.7 million or 23.1% to $8.9 million in 2008. This decrease was primarily due to a write-down of $1.6 million on the mortgage loan servicing asset during the fourth quarter of 2008. Long-term interest rates on fixed-rate mortgage loans decreased during the fourth quarter and the value of Park’s mortgage loan servicing asset decreased due to faster prepay assumptions on sold mortgage loans being serviced by Park. Park’s management expects that the volume of fixed-rate mortgage loans originated and sold into the secondary market will double in 2009 and as a result will expect other service income to increase by 60.0% to $14.2 million in 2009. Other service income was $11.5 million in 2007 ($10.3 million excluding Vision) and $10.9 million in 2006.

The subcategory of “Other” income includes fees earned from check card and ATM services, income from bank owned life insurance, fee income earned from the sale of official checks and printed checks, rental fee income from safe deposit boxes and other miscellaneous income. Total other income increased by $14.7 million or 67.3% to $36.6 million in 2008. This increase was primarily due to the two “one-time” revenue items which totaled $14.9 million. Excluding these two items, total other income decreased by $.2 million in 2008. By comparison, the increase in other income was $1.7 million or 8.2% to $21.9 million in 2007. Excluding Vision Bank, the increase in other income was $1.1 million or 5.3% in 2007. Management expects that other income will be approximately $23 million in 2009. For 2009, management projects total other income to be approximately $75 million.

Other Expense: Total other expense was $234.5 million in 2008, compared to $224.2 million in 2007 and $141.0 million in 2006. Total other expense includes goodwill impairment charges of $55.0 million in 2008 and $54.0 million in 2007. Excluding the goodwill impairment charges, total other expense increased by $9.4 million or 5.5% to $179.5 million in 2008 and increased by $29.1 million or 20.7% to $170.1 million in 2007. A year ago, Park’s management had projected total other expense of $177.0 million for 2008. The actual results were $2.5 million or 1.4% higher than the projected amount. The large increase in total other expense in 2007 was primarily due to the acquisition of Vision Bank. In 2007, total other expense (excluding the goodwill impairment charge) was $18.5 million for Vision Bank.

The following table displays total other expense for Park in 2008, 2007 and 2006.

Year Ended December 31
(Dollars in thousands)	2008		2007		2006
Salaries and employee benefits	$	99,018	$	97,712	$	82,579
Goodwill impairment charge		54,986		54,035		—
Data processing fees		7,121		6,892		4,246
Fees and service charges		12,801		11,055		9,553
Net occupancy expense of bank premises		11,534		10,717		9,155
Amortization of intangibles		4,025		3,847		2,470
Furniture and equipment expense		9,756		9,259		8,215
Insurance		2,322		1,445		1,137
Marketing		4,525		4,961		4,438
Postage and telephone		7,167		6,910		6,303
State taxes		2,989		2,769		2,333
Other		18,257		14,562		10,573
Total other expense	$	234,501	$	224,164	$	141,002

Salaries and employee benefits expense increased by $1.3 million or 1.3% to $99.0 million in 2008. By comparison, salaries and employee benefits expense increased by $15.1 million or 18.3% to $97.7 million in 2007, but (exclusive of Vision) the increase in 2007 was $5.9 million or 7.1%. During the fourth quarter of 2007, Park granted 90,000 incentive stock options to officers and other key employees of Park’s subsidiaries and accordingly recognized $.9 million of compensation expense. No stock options were granted in 2008.

Full-time equivalent employees at year-end 2008 were 2,051 compared to 2,066 at year-end 2007 and 1,892 at year-end 2006. Vision Bank had 214 full-time equivalent employees at year-end 2008 and 201 at year-end 2007.

On July 30, 2007, Park announced a plan (“Project EPS”) to review current processes and identify opportunities to improve efficiency by converting to one operating system. During the third quarter of 2008, Park merged its eight Ohio banking charters into a national bank charter, PNB. The banking divisions of PNB have been able to reduce full-time equivalent employees as a result of Project EPS. Park’s Ohio-based banking divisions reduced full-time equivalent employees by a net of 28 or 1.5% in 2008. Park’s management expects an additional reduction in full-time equivalent employees as Project EPS is expected to be completed during the fourth quarter of 2009.

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FINANCIAL REVIEW

A year ago, Park’s management projected that salaries and employee benefits expense would increase by approximately 6.5% in 2008. This estimate included an estimated $2 million of severance expense pertaining to Project EPS. Park was able to achieve reductions in full-time equivalent employees without paying any meaningful amount of severance in 2008. For 2009, Park’s management projects that salaries and employee benefits expense will increase to approximately $103 million or by 4.0%. Most of this projected increase is due to an estimated increase in pension plan expense of $3 million in 2009.

Vision Bank recorded goodwill impairment charges of $55.0 million in 2008 and $54.0 million in 2007. Please see Note 1 of the Notes to Consolidated Financial Statements for a discussion of the goodwill impairment charges. Vision Bank did not have any remaining goodwill at year-end 2008.

Other fees and service charges increased by $1.7 million or 15.8% to $12.8 million in 2008. This subcategory of total other expense includes legal fees, management consulting fees, director fees, audit fees, regulatory examination fees and memberships in industry associations. The large increase in other fees and service charges expense in 2008 was primarily due to an increase in management consulting fees of $.7 million to $1.3 million. This expense primarily pertained to Project EPS.

The subcategory “Other” expense includes expenses for supplies, travel, charitable contributions, amortization of low income housing tax credit investments, expenses pertaining to other real estate owned and other miscellaneous expenses. The subcategory other expense increased by $3.7 million or 25.4% to $18.3 million in 2008. This increase in other expense was primarily due to an increase in other real estate owned expenses from $3.4 million to $4.1 million.

Park’s management expects that total other expense will be approximately $184.0 million in 2009. This projected amount represents an increase of $4.5 million or 2.5% in total other expense compared to $179.5 million for 2008, which is exclusive of the $55.0 million goodwill impairment charge.

Income Taxes: Federal income tax expense was $24.3 million in 2008, compared to $30.4 million in 2007 and $39.0 million in 2006. State income tax expense was a credit of ($2.3) million in 2008 and a credit of ($453,000) in 2007. Vision Bank is subject to state income tax in the states of Alabama and Florida. State tax expense was a credit in both 2008 and 2007, because Vision Bank had losses in both years. Park and its Ohio-based subsidiaries do not pay state income tax to the state of Ohio, but pay a franchise tax based on year-end equity. The franchise tax expense is included in “state taxes” on Park’s Consolidated Statements of Income.

Federal income tax expense as a percentage of income before taxes was 68.1% in 2008 and 57.8% in 2007. The goodwill impairment charge of $55.0 million in 2008 reduced income tax expense by approximately $1 million. The goodwill impairment charge of $54.0 million in 2007 had no impact on income tax expense.

For 2008 and 2007, the percentage of federal income tax expense to income before taxes (adjusted for the goodwill impairment charges) was 26.8% and 28.5%, respectively. By comparison, the percentage of federal income taxes to income before taxes was 29.3% in 2006.

A lower federal effective tax rate than the statutory rate of 35% is primarily due to tax-exempt interest income from state and municipal investments and loans, low income housing tax credits and income from bank owned life insurance.

Park’s management expects that the federal effective income tax rate for 2009 will be approximately 29.0%.

CREDIT EXPERIENCE

Provision for Loan Losses: The provision for loan losses is the amount added to the allowance for loan losses to absorb future loan charge-offs. The amount of the loan loss provision is determined by management after reviewing the risk characteristics of the loan portfolio, historic and current loan loss experience and current economic conditions.

The provision for loan losses was $70.5 million in 2008, $29.5 million in 2007 and $3.9 million in 2006. Net loan charge-offs were $57.5 million in 2008, $22.2 million in 2007 and $3.9 million in 2006. The ratio of net loan charge-offs to average loans was 1.32% in 2008, .55% in 2007 and .12% in 2006.

Vision Bank experienced significant credit problems during 2008 and the second half of 2007. The loan loss provision for Vision Bank was $47.0 million in 2008 and $19.4 million in 2007.

Net loan charge-offs for Vision Bank were $38.5 million in 2008 and $8.6 million in 2007. Vision Bank’s ratio of net loan charge-offs to average loans was 5.69% in 2008 and an annualized 1.71% in 2007.

Park’s Ohio-based subsidiaries had a combined loan loss provision of $23.5 million in 2008 and $10.1 million in 2007. Net loan charge-offs for Park’s Ohio-based operations were $19.0 million in 2008 and $13.6 million in 2007. The net loan charge-off ratio for Park’s Ohio-based subsidiaries was .52% for 2008 and .39% for 2007.

At year-end 2008, the allowance for loan losses was $100.1 million or 2.23% of total loans outstanding, compared to $87.1 million or 2.06% of total loans outstanding at year-end 2007 and $70.5 million or 2.03% of total loans outstanding at year-end 2006. In two of the last three years, the loan loss reserve for an acquired bank was added to Park’s allowance for loan losses. The Vision acquisition added $9.3 million in 2007 and the Anderson acquisition added $798,000 in 2006.

Management believes that the allowance for loan losses at year-end 2008 is adequate to absorb probable incurred credit losses in the loan portfolio. See Note 1 of the Notes to Consolidated Financial Statements and the discussion under the heading “Critical Accounting Policies” earlier in this “Financial Review” section for additional information on management’s evaluation of the adequacy of the allowance for loan losses.

Management expects that the loan loss provision for 2009 will be approximately $45 million and that the annualized net loan charge-off ratio will be approximately 1.00%. This estimate could change significantly as circumstances for individual loans and economic conditions change.

A year ago, management projected that the provision for loan losses would be $20 to $25 million in 2008 and that the net loan charge-off ratio would be .45% to .55%. The credit problems at Vision Bank in 2008 were far worse than management anticipated. General economic conditions deteriorated throughout the year and as a result, real estate values declined in the Florida markets in which Vision Bank operates.

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FINANCIAL REVIEW

Table 7 — Summary of Loan Loss Experience

(In thousands)	2008			2007			2006			2005			2004
Average loans (net of unearned interest)	$	4,354,520		$	4,011,307		$	3,357,278		$	3,278,092		$	2,813,069
Allowance for loan losses:
Beginning balance		87,102			70,500			69,694			68,328			63,142
Charge-offs:
Commercial, financial and agricultural		2,953			4,170			853			3,154			2,557
Real estate — construction		34,052			7,899			718			46			613
Real estate — residential		12,600			5,785			1,915			1,006			1,476
Real estate — commercial		4,126			1,899			556			1,612			1,951
Consumer		9,181			8,020			6,673			7,255			8,111
Leases		4			3			57			316			465
Total charge-offs		62,916			27,776			10,772			13,389			15,173
Recoveries:
Commercial, financial and agricultural	$	861		$	1,011		$	842		$	2,707		$	2,138
Real estate — construction		137			180			—			173			67
Real estate — residential		1,128			718			1,017			659			650
Real estate — commercial		451			560			1,646			517			292
Consumer		2,807			3,035			3,198			3,214			3,633
Leases		31			64			150			229			529
Total recoveries		5,415			5,568			6,853			7,499			7,309
Net charge-offs		57,501			22,208			3,919			5,890			7,864
Provision charged to earnings		70,487			29,476			3,927			5,407			8,600
Allowance for loan losses of acquired bank		—			9,334			798			1,849			4,450
Ending balance	$	100,088		$	87,102		$	70,500		$	69,694		$	68,328
Ratio of net charge-offs to average loans		1.32	%		0.55	%		0.12	%		0.18	%		0.28	%
Ratio of allowance for loan losses to end of year loans, net of unearned interest		2.23	%		2.06	%		2.03	%		2.09	%		2.19	%

The following table summarizes the allocation of the allowance for loan losses for the past five years:

Table 8 — Allocation of Allowance for Loan Losses

December 31,	2008					2007					2006					2005					2004
			Percent of					Percent of					Percent of					Percent of					Percent of
(Dollars in			Loans Per					Loans Per					Loans Per					Loans Per					Loans Per
thousands)	Allowance		Category			Allowance		Category			Allowance		Category			Allowance		Category			Allowance		Category
Commercial, financial and agricultural	$	14,286		15.90	%	$	14,557		14.52	%	$	16,985		15.75	%	$	17,942		15.40	%	$	17,837		15.04	%
Real estate — construction		24,794		11.88	%		20,007		12.70	%		4,425		6.75	%		3,864		5.80	%		3,107		4.98	%
Real estate — residential		22,077		34.74	%		15,997		35.06	%		10,402		37.36	%		10,329		38.68	%		8,926		38.14	%
Real estate — commercial		15,498		23.06	%		15,989		23.51	%		17,097		24.56	%		16,823		24.74	%		16,930		24.11	%
Consumer		23,391		14.33	%		20,477		14.05	%		21,285		15.29	%		19,799		14.87	%		20,206		16.19	%
Leases		42		0.09	%		75		0.16	%		306		0.29	%		937		0.51	%		1,322		1.54	%
Total	$	100,088		100.00	%	$	87,102		100.00	%	$	70,500		100.00	%	$	69,694		100.00	%	$	68,328		100.00	%

As of December 31, 2008, Park had no significant concentrations of loans to borrowers engaged in the same or similar industries nor did Park have any loans to foreign governments.

Nonperforming Assets: Nonperforming loans include: 1) loans whose interest is accounted for on a nonaccrual basis; 2) loans whose terms have been renegotiated; and 3) loans which are contractually past due 90 days or more as to principal or interest payments but whose interest continues to accrue. Other real estate owned results from taking title to property used as collateral for a defaulted loan.

The percentage of nonperforming loans to total loans was 3.74% at year-end 2008, 2.57% at year-end 2007 and .95% at year-end 2006. The percentage of nonperforming assets to total loans was 4.31% at year-end 2008, 2.89% at year-end 2007 and 1.04% at year-end 2006.

Vision Bank had $94.7 million of nonperforming loans or 13.7% of their total loans at year-end 2008, compared to $63.5 million of nonperforming loans or 9.9% of their total loans at year-end 2007. Nonperforming assets totaled $114.4 million for Vision Bank at year-end 2008, compared to $70.5 million at year-end 2007. As a percentage of year-end loans, Vision Bank’s nonperforming assets were 16.6% and 11.0% for 2008 and 2007, respectively.

Park’s Ohio-based subsidiaries had $73.1 million of nonperforming loans at year-end 2008, compared to $45.0 million at year-end 2007. Nonperforming loans were 1.9% and 1.3% of loans for Park’s Ohio-based operations at year-end 2008 and 2007, respectively. Total nonperforming assets for Park’s Ohio-based subsidiaries were $79.2 million or 2.1% of loans at year-end 2008 and $51.4 million or 1.4% of loans at year-end 2007.

Economic conditions began deteriorating during the second half of 2007 and continued throughout 2008. Park and many other financial institutions throughout the country experienced a sharp increase in net loan charge-offs and nonperforming loans. Financial institutions operating in Florida (including Vision Bank) have been particularly hard hit by the severe recession as the demand for real estate and the price of real estate have sharply decreased.

Park’s lending management has reviewed closely all of the nonperforming loans and nonperforming assets as of December 31, 2008. Partial loan charge-offs of approximately $30 million have been recognized on nonperforming loans at year-end 2008. Approximately $20 million of these net loan charge-offs were recorded at Vision Bank.

Park had $243.2 million of loans included on the watch list of potential problem loans at December 31, 2008 compared to $208.8 million at year-end 2007 and $176.8 million at year-end 2006. As a percentage of year-end total loans, Park’s watch list of potential problem loans was 5.4% in 2008, 4.9% in 2007 and 5.1% in 2006. The existing conditions of these loans do not warrant classification as nonaccrual. However, these loans have shown some weakness and management performs additional analyses regarding a borrower’s ability to comply with payment terms for watch list loans.

The following is a summary of the nonaccrual, past due and renegotiated loans and other real estate owned for the last five years:

Table 9 — Nonperforming Assets

December 31,
(Dollars in thousands)	2008			2007			2006			2005			2004
Nonaccrual loans	$	159,512		$	101,128		$	16,004		$	14,922		$	17,873
Renegotiated loans		2,845			2,804			9,113			7,441			5,461
Loans past due 90 days or more		5,421			4,545			7,832			7,661			5,439
Total nonperforming loans		167,778			108,477			32,949			30,024			28,773
Other real estate owned		25,848			13,443			3,351			2,368			2,680
Total nonperforming assets	$	193,626		$	121,920		$	36,300		$	32,392		$	31,453
Percentage of nonperforming loans to loans, net of unearned income		3.74	%		2.57	%		0.95	%		0.90	%		0.92	%
Percentage of nonperforming assets to loans, net of unearned income		4.31	%		2.89	%		1.04	%		0.97	%		1.01	%
Percentage of nonperforming assets to total assets		2.74	%		1.88	%		0.66	%		0.60	%		0.58	%

Tax equivalent interest income from loans of $301.9 million for 2008 would have increased by $12.1 million if all loans had been current in accordance with their original terms.

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FINANCIAL REVIEW

CAPITAL RESOURCES

Liquidity and Interest Rate Sensitivity Management: Park’s objective in managing its liquidity is to maintain the ability to continuously meet the cash flow needs of customers, such as borrowings or deposit withdrawals, while at the same time seeking higher yields from longer-term lending and investing activities.

Cash and cash equivalents decreased by $22.1 million during 2008 to $171.3 million at year-end. Cash provided by operating activities was $90.7 million in 2008, $83.2 million in 2007 and $85.3 million in 2006. Net income (adjusted for the goodwill impairment charges) was the primary source of cash for operating activities during each year. The goodwill impairment charges of $55.0 million in 2008 and $54.0 million in 2007 did not impact cash and as a result had no impact on cash provided by operating activities.

Cash used in investing activities was $635.0 million in 2008 and $360.3 million in 2007. Cash provided by investing activities was $47.8 million in 2006. Investment security transactions are the major use or source of cash in investing activities. Proceeds from the sale, repayment or maturity of securities provide cash and purchases of securities use cash. Net security transactions used cash of $304.8 million in 2008 and $130.8 million in 2007 and provided cash of $145.9 million in 2006. Another major use or source of cash in investing activities is the net increase or decrease in the loan portfolio. Cash used by the net increase in the loan portfolio was $351.3 million in 2008, $126.0 million in 2007 and $99.3 million in 2006. In 2007, Park also used $38.3 million in cash to acquire the loans pertaining to the Millersburg, Ohio branch purchase and used $47.7 million of cash on a net basis for the acquisition of Vision.

Cash provided by financing activities was $522.2 million in 2008 and $284.2 million in 2007. Cash used in financing activities was $120.7 million in 2006. A major source of cash for financing activities is the net change in deposits. Cash provided by the net change in deposits was $322.5 million in 2008, $13.2 million in 2007 and $6.3 million in 2006. The large increase in deposits in 2008 was primarily due to the use of broker deposits, which added $235.7 million in deposits in 2008. Another major source of cash for financing activities is short-term borrowings and long-term debt. In 2008, net short-term borrowings used $100.1 million in cash and net long-term borrowings provided $265.1 million in cash. The net increase in short-term borrowings provided cash of $359.2 million in 2007 and $61.7 million in 2006. Cash was used by the net decrease in long-term borrowings of $19.4 million in 2007 and $110.6 million in 2006. In 2008, cash of $100.0 million was provided from the issuance of preferred stock. In 2007, cash was also provided from the deposits of $23.5 million acquired as part of the Millersburg, Ohio branch purchase and from the $25 million in proceeds from the issuance of subordinated debt.

Funds are available from a number of sources, including the securities portfolio, the core deposit base, Federal Home Loan Bank borrowings and the capability to securitize or package loans for sale. The present funding sources provide more than adequate liquidity for Park to meet its cash flow needs.

The following table shows interest rate sensitivity data for five different time intervals as of December 31, 2008:

Table 10 — Interest Rate Sensitivity

(Dollars	0-3			3-12			1-3			3-5			Over 5
in thousands)	Months			Months			Years			Years			Years			Total
Interest earning assets:
Investment securities (1)	$	255,318		$	242,984		$	377,344		$	233,258		$	950,147		$	2,059,051
Money market instruments		20,964			—			—			—			—			20,964
Loans (1)		1,756,245			1,126,092			1,336,032			252,245			20,723			4,491,337
Total interest earning assets		2,032,527			1,369,076			1,713,376			485,503			970,870			6,571,352
Interest bearing liabilities:
Interest bearing transaction accounts (2)		559,873			—			644,657			—			—			1,204,530
Savings accounts (2)		201,701			—			493,020			—			—			694,721
Time deposits		724,235			846,460			366,739			139,073			1,865			2,078,372
Other		1,502			—			—			—			—			1,502
Total deposits		1,487,311			846,460			1,504,416			139,073			1,865			3,979,125
Short-term borrowings		659,196			—			—			—			—			659,196
Long-term debt		202,178			29,045			18,920			1,000			604,416			855,559
Subordinated debentures		15,000			—			—			25,000			—			40,000
Total interest bearing liabilities		2,363,685			875,505			1,523,336			165,073			606,281			5,533,880
Interest rate sensitivity gap		(331,158	)		493,571			190,040			320,430			364,589			1,037,472
Cumulative rate sensitivity gap		(331,158	)		162,413			352,453			672,883			1,037,472			—
Cumulative gap as a percentage of total interest earning assets		-5.04	%		2.47	%		5.36	%		10.24	%		15.79	%		—

(1)

Investment securities and loans that are subject to prepayment are shown in the table by the earlier of their repricing date or their expected repayment dates and not by their contractual maturity. The totals for investment securities include interest bearing deposits with other banks.

(2)

Management considers interest bearing transaction accounts and savings accounts to be core deposits and therefore, not as rate sensitive as other deposit accounts and borrowed money. Accordingly, only 46% of interest bearing transaction accounts and 29% of savings accounts are considered to reprice within one year. If all of the interest bearing checking accounts and savings accounts were considered to reprice within one year, the one year cumulative gap would change from a positive 2.47% to a negative 14.84%.

The interest rate sensitivity gap analysis provides a good overall picture of Park’s static interest rate risk position. Park’s policy is that the twelve month cumulative gap position should not exceed fifteen percent of interest earning assets for three consecutive quarters. At December 31, 2008, the cumulative interest earning assets maturing or repricing within twelve months were $3,401.6 million compared to the cumulative interest bearing liabilities maturing or repricing within twelve months of $3,239.2 million. For the twelve-month cumulative gap position, rate sensitive assets exceed rate sensitive liabilities by $162.4 million or 2.5% of interest earning assets.

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FINANCIAL REVIEW

A positive twelve month cumulative rate sensitivity gap (assets exceed liabilities) would suggest that Park’s net interest margin would decrease if interest rates were to decrease. Conversely, a positive twelve month cumulative rate sensitivity gap would suggest that Park’s net interest margin would increase if interest rates were to increase. However, the usefulness of the interest sensitivity gap analysis as a forecasting tool in projecting net interest income is limited. The gap analysis does not consider the magnitude by which assets or liabilities will reprice during a period and also contains assumptions as to the repricing of transaction and savings accounts that may not prove to be correct.

A year ago, the cumulative twelve month interest rate sensitivity gap position at year-end 2007 was a similar amount of a positive $177.7 million or 3.0% of interest earning assets. The percentage of interest earning assets maturing or repricing within one year was 51.8% at year-end 2008 compared to 54.3% at year-end 2007. The percentage of interest bearing liabilities maturing or repricing within one year was 58.5% at year-end 2008 compared to 59.4% at year-end 2007.

Management supplements the interest rate sensitivity gap analysis with periodic simulations of balance sheet sensitivity under various interest rate and what-if scenarios to better forecast and manage the net interest margin. Park’s management uses an earnings simulation model to analyze net interest income sensitivity to movements in interest rates. This model is based on actual cash flows and repricing characteristics for balance sheet instruments and incorporates market-based assumptions regarding the impact of changing interest rates on the prepayment rate of certain assets and liabilities. This model also includes management’s projections for activity levels of various balance sheet instruments and noninterest fee income and operating expense.
Assumptions based on the historical behavior of deposit rates and balances in relation to changes in interest rates are also incorporated into this earnings simulation model. These assumptions are inherently uncertain and as a result, the model cannot precisely measure net interest income and net income. Actual results will differ from simulated results due to timing, magnitude, and frequency of interest rate changes as well as changes in market conditions and management strategies.

Management uses a 50 basis point change in market interest rates per quarter for a total of 200 basis points per year in evaluating the impact of changing interest rates on net interest income and net income over a twelve month horizon. At December 31, 2008, the earnings simulation model projected that net income would increase by .6% using a rising interest rate scenario and decrease by 3.3% using a declining interest rate scenario over the next year. At December 31, 2007, the earnings simulation model projected that net income would increase by .2% using a rising interest rate scenario and decrease by .6% using a declining interest rate scenario over the next year and at December 31, 2006, the earnings simulation model projected that net income would increase by .1% using a rising interest rate scenario and decrease by .7% using a declining interest rate scenario over the next year. Consistently, over the past several years, the earnings simulation model has projected that changes in interest rates would have only a small impact on net income and the net interest margin. The net interest margin has been relatively stable over the past three years at 4.16% in 2008, 4.20% in 2007 and 4.33% in 2006. A major goal of the asset/liability committee is to have a relatively stable net interest margin regardless of the level of interest rates. Management expects that the net interest margin will be approximately 4.08% in 2009. The large increase in nonaccrual loans in 2008 and 2007 reduced the net interest margin in both years compared to 2006. The large projected amount of nonaccrual loans and other real estate owned in 2009 are expected to further reduce the net interest margin.

CONTRACTUAL OBLIGATIONS

In the ordinary course of operations, Park enters into certain contractual obligations. Such obligations include the funding of operations through debt issuances as well as leases for premises. The following table summarizes Park’s significant and determinable obligations by payment date at December 31, 2008.

Further discussion of the nature of each specified obligation is included in the referenced Note to the Consolidated Financial Statements or referenced Table in this “Financial Review” section.

Table 11 — Contractual Obligations

December 31, 2008	Payments Due In
(Dollars	Table /		0-1		1-3		3-5		Over 5
in thousands)	Note		Years		Years		Years		Years		Total
Deposits without stated maturity		8	$	2,683,378	$	—	$	—	$	—	$	2,683,378
Certificates of deposit		8		1,563,967		372,454		140,010		1,941		2,078,372
Short-term borrowings		9		659,196		—		—		—		659,196
Long-term debt		10		31,262		219,006		1,116		604,174		855,558
Subordinated debentures		11		—		—		—		40,000		40,000
Operating leases		7		2,006		2,323		2,122		2,870		9,321
Purchase obligations				491		—		—		—		491
Total contractual obligations			$	4,940,300	$	593,783	$	143,248	$	648,985	$	6,326,316

The Corporation’s operating lease obligations represent short-term and long-term lease and rental payments for facilities and equipment. Purchase obligations represent obligations under agreements to purchase goods or services that are enforceable and legally binding on the Corporation.

Commitments, Contingent Liabilities, and Off-Balance Sheet Arrangements: In order to meet the financing needs of its customers, the Corporation issues loan commitments and standby letters of credit. At December 31, 2008, the Corporation had $1,143 million of loan commitments for commercial, commercial real estate, and residential real estate loans and had $25.4 million of standby letters of credit at December 31, 2008.

Commitments to extend credit for loan commitments and standby letters of credit do not necessarily represent future cash requirements. These commitments often expire without being drawn upon. However, all of the loan commitments and standby letters of credit are permitted to be drawn upon in 2009. See Note 18 of the Notes to Consolidated Financial Statements for additional information on loan commitments and standby letters of credit. The Corporation did not have any unrecorded significant contingent liabilities at December 31, 2008.

Capital: Park’s primary means of maintaining capital adequacy is through net retained earnings. At December 31, 2008, the Corporation’s stockholders’ equity was $642.7 million, compared to $580.0 million at December 31, 2007. Stockholders’ equity at December 31, 2008 was 9.09% of total assets compared to 8.92% of total assets at December 31, 2007. On December 23, 2008, Park issued $100 million of preferred stock to the U.S. Treasury (see Note 25 of the Notes to Consolidated Financial Statements for a description of this transaction).

Tangible stockholders’ equity (stockholders’ equity less goodwill and other intangible assets) was $557.1 million at December 31, 2008 and was $435.5 million at December 31, 2007. At December 31, 2008, tangible stockholders’ equity was 7.98% of total tangible assets (total assets less goodwill and other intangible assets), compared to 6.85% at December 31, 2007.

42

FINANCIAL REVIEW

Tangible common equity (tangible stockholders’ equity less preferred stock) was $461.4 million at December 31, 2008 compared to $435.5 million at December 31, 2007. At December 31, 2008, tangible common equity was 6.61% of tangible assets, compared to 6.85% at December 31, 2007.

Net income for 2008 was $13.7 million, $22.7 million in 2007, and $94.1 million in 2006. The decrease in net income in 2008 was primarily due to a loss of $81.2 million at Vision Bank. This loss includes a goodwill impairment charge of $55.0 million and a loan loss provision of $47.0 million. The year ended December 31, 2007 also included a goodwill impairment charge of $54.0 million at Vision Bank.

Cash dividends declared were $52.6 million in 2008, $52.8 million in 2007 and $51.4 million in 2006. On a per share basis, the cash dividends declared were $3.77 per share in 2008, $3.73 per share in 2007, and $3.69 per share in 2006.

Park did not purchase any treasury stock during 2008. In 2007, Park purchased 760,531 shares of treasury stock totaling $65.6 million at a weighted average cost of $86.21 per share. In 2006, Park purchased 302,786 shares of treasury stock totaling $30.5 million at a weighted average cost of $100.76 per share. Treasury stock had a balance in stockholders’ equity of $207.7 million at December 31, 2008 compared to $208.1 million at December 31, 2007 and $143.4 million at December 31, 2006.

During 2008, Park did not issue any shares of Park common stock, however, Park recorded $4.3 million for the common stock warrant as part of the issuance of $100 million of preferred stock (see Note 1 and Note 25 of the Notes to Consolidated Financial Statements). In 2007, Park issued 792,937 shares of Park common stock valued at a price of $105.00 per share for a total value of $83.3 million pursuant to the acquisition of Vision on March 9, 2007. In 2006, Park issued 86,137 shares of common stock valued at a price of $100.60 per share for a total value of $8.7 million pursuant to the acquisition of Anderson. Common stock had a balance in stockholders’ equity of $301.2 million at December 31, 2008 and December 31, 2007 compared to $217.1 million at December 31, 2006.

Accumulated other comprehensive income (loss) was $10.6 million at December 31, 2008 compared to ($2.6) million at December 31, 2007 and ($22.8) million at December 31, 2006. Long-term interest rates began a significant decline in the fourth quarter of 2007 and continued through 2008. Therefore, the market value of Park’s investment securities increased during 2007 and continued to increase in 2008. Park recognized $30.7 million of other comprehensive income in 2008 on investment securities and $16.9 million in 2007. In addition, Park recognized a loss of ($16.2) million of other comprehensive income related to the change in pension plan assets and benefit obligations in 2008, compared to income of $3.3 million of other comprehensive income related to pension in 2007. Finally, Park has recognized ($1.3) million of comprehensive loss due to the mark-to-market of a cash flow hedge at December 31, 2008.

Financial institution regulators have established guidelines for minimum capital ratios for banks, thrifts, and bank holding companies. Park’s accumulated other comprehensive income (loss) is not included in computing regulatory capital. The minimum leverage capital ratio (defined as stockholders’ equity less intangible assets divided by tangible assets) is 4% and the well capitalized ratio is greater than or equal to 5%. Park’s leverage ratio was 8.36% at December 31, 2008 and exceeded the minimum capital required by $292 million. The minimum Tier 1 risk-based capital ratio (defined as leverage capital divided by risk-adjusted assets) is 4% and the well capitalized ratio is greater than or equal to 6%. Park’s Tier 1 risk-based capital ratio was 11.69% at December 31, 2008 and exceeded the minimum capital required by $369 million. The minimum total risk-based capital ratio (defined as leverage capital plus supplemental capital divided by risk-adjusted assets) is 8% and the well capitalized ratio is greater than or equal to 10%. Park’s total risk-based capital ratio was 13.47% at December 31, 2008 and exceeded the minimum capital required by $262 million.

At December 31, 2008, Park exceeded the well capitalized regulatory guidelines for bank holding companies. Park exceeded the well capitalized leverage capital ratio of 5% by $225 million, exceeded the well capitalized Tier 1 risk-based capital ratio of 6% by $272 million and exceeded the well capitalized total risk-based capital ratio of 10% by $167 million at December 31, 2008.

The two financial institution subsidiaries of Park each met the well capitalized ratio guidelines at December 31, 2008. See Note 22 of the Notes to Consolidated Financial Statements for the capital ratios for Park and its two financial institution subsidiaries.

Effects of Inflation: Balance sheets of financial institutions typically contain assets and liabilities that are monetary in nature, and therefore, differ greatly from most commercial and industrial companies which have significant investments in premises, equipment and inventory. During periods of inflation, financial institutions that are in a net positive monetary position will experience a decline in purchasing power, which does have an impact on growth. Another significant effect on internal equity growth is other expenses, which tend to rise during periods of inflation.

Management believes the most significant impact on financial results is the Corporation’s ability to align its asset/liability management program to react to changes in interest rates.

The following table summarizes five-year financial information. All per share data have been retroactively restated for the 5% stock dividend paid on December 15, 2004.

Table 12 — Consolidated Five-Year Selected Financial Data

December 31,
(Dollars in thousands,
except per share data)	2008		2007		2006		2005		2004
Results of Operations:
Interest income	$	391,339	$	401,824	$	334,559	$	314,459	$	270,993
Interest expense		135,466		167,147		121,315		93,895		58,702
Net interest income		255,873		234,677		213,244		220,564		212,291
Provision for loan losses		70,487		29,476		3,927		5,407		8,600
Net interest income after provision for loan losses		185,386		205,201		209,317		215,157		203,691
Net gains (losses) on sale of securities		1,115		—		97		96		(793	)
Noninterest income		83,719		71,640		64,665		59,609		52,641
Noninterest expense		234,501		224,164		141,002		139,438		126,290
Net income		13,708		22,707		94,091		95,238		91,507
Net income available to common shareholders		13,566		22,707		94,091		95,238		91,507
Net income available to common shareholders excluding impairment charge (a)		68,552		76,742		94,091		95,238		91,507
Per common share:
Net income per common share — basic		0.97		1.60		6.75		6.68		6.38
Net income per common share — diluted		0.97		1.60		6.74		6.64		6.32
Net income per common share excluding impairment charge — diluted (a)		4.91		5.40		6.74		6.64		6.32
Cash dividends declared		3.770		3.730		3.690		3.620		3.414
Average Balances:
Loans		4,354,520		4,011,307		3,357,278		3,278,092		2,813,069
Investment securities		1,801,299		1,596,205		1,610,639		1,851,598		1,901,129
Money market instruments and other		15,502		17,838		8,723		12,258		9,366
Total earning assets		6,171,321		5,625,350		4,976,640		5,141,948		4,723,564
Noninterest bearing deposits		739,993		697,247		662,077		643,032		574,560
Interest bearing deposits		3,862,780		3,706,231		3,162,867		3,187,033		2,946,360
Total deposits		4,602,773		4,403,478		3,824,944		3,830,065		3,520,920

43

FINANCIAL REVIEW

Table 12 — Consolidated Five-Year Selected Financial Data continued

December 31,
(Dollars in thousands,
except per share data)	2008			2007			2006			2005			2004
Average Balances:
Short-term borrowings		609,219			494,160			375,332			291,842			401,299
Long-term debt		835,522			568,575			553,307			799,888			519,979
Stockholders’ equity		567,965			618,758			545,074			559,211			538,275
Common stockholders’ equity		565,612			618,758			545,074			559,211			538,275
Total assets		6,708,086			6,169,156			5,380,623			5,558,088			5,049,081
Ratios:
Return on average assets		0.20	%		0.37	%		1.75	%		1.71	%		1.81	%
Return on average assets excluding impairment charge (a)		1.02	%		1.24	%		1.75	%		1.71	%		1.81	%
Return on average common equity (x)		2.42	%		3.67	%		17.26	%		17.03	%		17.00	%
Return on average common equity excluding impairment charge (a) (x)		12.12	%		12.40	%		17.26	%		17.03	%		17.00	%
Net interest margin (1)		4.16	%		4.20	%		4.33	%		4.34	%		4.56	%
Noninterest expense excluding impairment charge to net revenue (1)		52.59	%		55.21	%		50.35	%		49.32	%		47.11	%
Dividend payout ratio		387.79	%		232.35	%		54.65	%		54.19	%		53.54	%
Average stockholders’ equity to average total assets		8.47	%		10.03	%		10.13	%		10.06	%		10.66	%
Leverage capital		8.36	%		7.10	%		9.96	%		9.27	%		10.10	%
Tier 1 capital		11.69	%		10.16	%		14.72	%		14.17	%		15.16	%
Risk-based capital		13.47	%		11.97	%		15.98	%		15.43	%		16.43	%

(1)	Computed on a fully taxable equivalent basis
(x)	Reported measure includes the impact of the preferred stock issued to the U.S. Treasury under the Capital Purchase Program and uses net income available to common shareholders.
(a)	Net income for the year has been adjusted for the impairment charge to goodwill. Net income before impairment charge equals net income for the year plus the impairment charge to goodwill of $54,986 and $54,035 for 2008 and 2007, respectively.

Twelve Months Ended December 31,
(In thousands, except per share data)	2008		2007
Reconciliation of net income available to common shareholders to net income available to common shareholders excluding impairment charge:
Net income available to common shareholders	$	13,566	$	22,707
Plus goodwill impairment charge		54,986		54,035
Net income available to common shareholders before impairment charge	$	68,552	$	76,742
Reconciliation of net income per common share — diluted to net income per common share — diluted excluding impairment charge:
Net income per common share — diluted	$	0.97	$	1.60
Plus impairment charge to goodwill per common share — diluted		3.94		3.80
Net income per common share before impairment charge — diluted	$	4.91	$	5.40

Non-GAAP Financial Measures: Park’s management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate Park’s performance. Specifically, management reviews (i) net income available to common shareholders before impairment charge, (ii) net income available to common shareholders before impairment charge per common share-diluted, (iii) return on average assets before impairment charge, (iv) return on average common equity before impairment charge, and (v) efficiency ratio before impairment charge, (collectively, the “adjusted performance metrics”) and has included in this annual report information relating to the adjusted performance metrics for the twelve-month periods ended December 31, 2008 and 2007, and the three-month periods ended December 31, 2007, September 30, 2008, and December 31, 2008. Management believes the adjusted performance metrics present a more reasonable view of Park’s operating performance and ensures comparability of operating performance from period to period while eliminating the one-time non-recurring impairment charges. Park has provided reconciliations of the GAAP measures to the adjusted performance metrics solely for the purpose of complying with SEC Regulation G and not as an indication that the adjusted performance metrics are a substitute for other measures determined by GAAP.

The following table is a summary of selected quarterly results of operations for the years ended December 31, 2008 and 2007. Certain quarterly amounts have been reclassified to conform to the year-end financial statement presentation.

Table 13 — Quarterly Financial Data

(Dollars in thousands,	Three Months Ended
except per share data)	March 31		June 30		Sept. 30			Dec. 31
2008:
Interest income	$	100,468	$	98,201	$	97,947		$	94,723
Interest expense		38,984		33,875		32,719			29,888
Net interest income		61,484		64,326		65,228			64,835
Provision for loan losses		7,394		14,569		15,906			32,618
Gain (loss) on sale of securities		309		587		—			219
Income (loss) before income taxes		32,161		24,454		(33,069	)		12,173
Net income (loss)		22,978		18,191		(38,412	)		10,951
Net income (loss) available to common shareholders		22,978		18,191		(38,412	)		10,809
Net income available to common shareholders excluding impairment charge (a)		22,978		18,191		16,574			10,809
Per common share data:
Net income (loss) per common share — basic (x)		1.65		1.30		(2.75	)		0.77
Net income (loss) per common share — diluted (x)		1.65		1.30		(2.75	)		0.77
Net income per common share excluding impairment charge — diluted (a) (x)		1.65		1.30		1.19			0.77
Weighted-average common stock outstanding — basic		13,964,572		13,964,561		13,964,549			13,967,194
Weighted-average common stock equivalent — diluted		13,964,572		13,964,561		13,964,549			13,967,650
2007:
Interest income	$	90,836	$	102,825	$	103,766		$	104,397
Interest expense		35,938		42,415		44,350			44,444
Net interest income		54,898		60,410		59,416			59,953
Provision for loan losses		2,205		2,881		5,793			18,597
Gain (loss) on sale of securities		—		—		—			—
Income (loss) before income taxes		29,558		33,511		29,866			(40,258	)
Net income (loss)		21,063		23,510		21,304			(43,170	)
Net income excluding impairment charge (a)		21,063		23,510		21,304			10,865
Per share data:
Net income (loss) — basic		1.49		1.62		1.50			(3.08	)
Net income (loss) — diluted		1.49		1.62		1.50			(3.08	)
Net income per share excluding impairment charge — diluted (a)		1.49		1.62		1.50			0.77
Weighted-average common stock outstanding — basic		14,121,331		14,506,926		14,193,019			14,029,944
Weighted-average common stock equivalent — diluted		14,138,517		14,507,895		14,193,019			14,030,499

(x)	Reported measure includes the impact of the preferred stock issued to the U.S. Treasury under the Capital Purchase Program and uses net income available to common shareholders.
(a)	Net income for the third quarter of 2008 and fourth quarter of 2007 has been adjusted for the impairment charge to goodwill. Net income excluding the impairment charge equals net income for the period plus the impairment charge to goodwill of $54,986 for the third quarter of 2008 and $54,035 for the fourth quarter of 2007.

44

FINANCIAL REVIEW

(Dollars in thousands,	Three Months Ended
except per share data)	March 31		June 30		Sept. 30			Dec. 31
2008:
Reconciliation of net income (loss) available to common shareholders to net income available to common shareholders excluding impairment charge:
Net income (loss) available to common shareholders	$	22,978	$	18,191	$	(38,412	)	$	10,809
Plus goodwill impairment charge		—		—		54,986			—
Net income available to common shareholders before impairment charge		22,978		18,191		16,574			10,809
Reconciliation of net income (loss) per common share — diluted to net income per common share — diluted excluding impairment charge:
Net income (loss) per common share — diluted		1.65		1.30		(2.75	)		0.77
Plus impairment charge to goodwill per share — diluted		—		—		3.94			—
Net income per common share before impairment charge — diluted		1.65		1.30		1.19			0.77
2007:
Reconciliation of net income (loss) to net income excluding impairment charge:
Net income (loss) available to common shareholders	$	21,063	$	23,510	$	21,304		$	(43,170	)
Plus goodwill impairment charge		—		—		—			54,035
Net income available to common shareholders before impairment charge		21,063		23,510		21,304			10,865
Reconciliation of net income (loss) per share — diluted to net income per share — diluted excluding impairment charge:
Net income (loss) per common share — diluted		1.49		1.62		1.50			(3.08	)
Plus impairment charge to goodwill per share — diluted		—		—		—			3.85
Net income per common share before impairment charge — diluted		1.49		1.62		1.50			0.77

The Corporation’s common stock (symbol: PRK) is traded on the NYSE Alternext. At December 31, 2008, the Corporation had 4,686 stockholders of record. The following table sets forth the high, low and closing sale prices of, and dividends declared on the common stock for each quarterly period for the years ended December 31, 2008 and 2007, as reported by NYSE Alternext since October 1, 2008 and by its predecessor, American Stock Exchange LLC, prior thereto.

Table 14 — Market and Dividend Information

							Cash
							Dividend
					Last		Declared
	High		Low		Price		Per Share
2008:
First Quarter	$	74.87	$	56.80	$	70.85	$	0.94
Second Quarter		78.65		53.90		53.90		0.94
Third Quarter		82.50		44.87		78.00		0.94
Fourth Quarter		80.00		53.55		71.75		0.95
2007:
First Quarter	$	101.25	$	88.48	$	94.48	$	0.93
Second Quarter		95.50		83.50		84.79		0.93
Third Quarter		93.45		78.55		87.20		0.93
Fourth Quarter		91.70		64.50		64.50		0.94

PERFORMANCE GRAPH

Table 15 compares the total return performance for Park common shares with the NYSE Alternext, the NASDAQ Bank Stocks Index and the SNL Financial Bank and Thrift Index for the five-year period from December 31, 2003 to December 31, 2008. The NYSE Alternext Composite Index is a market capitalization-weighted index of the stocks listed on the NYSE Alternext. The NASDAQ Bank Stocks Index is comprised of all depository institutions, holding companies and other investment companies that are traded on The NASDAQ Global Select and Global Markets. Park considers a number of bank holding companies traded on The NASDAQ National Market to be within its peer group. The SNL Financial Bank and Thrift Index is comprised of all publicly traded bank and thrift stocks researched by SNL Financial.

The NYSE Alternext financial stocks Index includes the stocks of banks, thrifts, finance companies and securities broker-dealers. Park believes that The NASDAQ Bank Stocks Index and the SNL Financial Bank and Thrift Index are more appropriate industry indices for Park to use for the five-year total return performance comparison.

Table 15 — Total Return Performance

The total return performance for Park’s common shares underperformed the total return performance of the NYSE Alternext Composite Index in the five-year comparison as indicated in Table 15, but outperformed both The NASDAQ Bank Stocks Index and the SNL Bank and Thrift Index for the same five-year period. The annual compound total return on Park’s common shares for the past five years was a negative 4.1%. By comparison, the annual compound total returns for the past five years on the NYSE Alternext Composite Index, The NASDAQ Bank Stocks Index and the SNL Bank and Thrift Index were positive 5.8%, negative 6.9% and negative 10.2%, respectively.

The total return performance for bank stocks in 2008 was very poor. However, Park’s total return on common shares for 2008 was a positive 17.7%, compared to a total return on The NASDAQ Bank Stocks Index of a negative 23.9% and a total return on the SNL Bank and Thrift Index of a negative 42.5%.

45

Management’s Report on Internal Control Over Financial Reporting

To the Board of Directors and Stockholders
Park National Corporation

The management of Park National Corporation (the “Corporation”) is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a — 15(f) and 15d — 15(f) under the Securities Exchange Act of 1934. The Corporation’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. The Corporation’s internal control over financial reporting includes those policies and procedures that:

a.)	pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Corporation and its consolidated subsidiaries;
b.)	provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of the Corporation and its consolidated subsidiaries are being made only in accordance with authorizations of management and directors of the Corporation; and
c.)	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the assets of the Corporation and its consolidated subsidiaries that could have a material effect on the financial statements.

The Corporation’s internal control over financial reporting as it relates to the financial statements is evaluated for effectiveness by management and tested for reliability through a program of internal audits. Actions are taken to correct potential deficiencies as they are identified.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluations of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Accordingly, even an effective system of internal control over financial reporting will provide only reasonable assurance with respect to financial statement preparation.

With the participation of our Chairman of the Board and Chief Executive Officer, our President and our Chief Financial Officer, management evaluated the effectiveness of the Corporation’s internal control over financial reporting as of December 31, 2008, the end of the Corporation’s fiscal year. In making this assessment, management used the criteria set forth for effective internal control over financial reporting by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework.

Based on our assessment under the criteria described in the proceeding paragraph, management concluded that the Corporation maintained effective internal control over financial reporting as of December 31, 2008.

The Corporation’s independent registered public accounting firm, Crowe Horwath LLP, has audited the Corporation’s 2008 and 2007 consolidated financial statements included in this Annual Report and the Corporation’s internal control over financial reporting as of December 31, 2008, and has issued their Report of Independent Registered Public Accounting Firm, which appears in this Annual Report.

/s/ C. Daniel DeLawder C. Daniel DeLawder	/s/ David L. Trautman David L. Trautman	/s/ John W. Kozak John W. Kozak
Chairman and Chief Executive Officer	President	Chief Financial Officer

February 25, 2009

46

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders
Park National Corporation
Newark, Ohio

We have audited the accompanying consolidated balance sheets of Park National Corporation as of December 31, 2008 and 2007 and the related consolidated statements of income, changes in stockholders’ equity and cash flows for each of the three years in the period ended December 31, 2008. We also have audited Park National Corporation’s internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Park National Corporation’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on these financial statements and an opinion on the company’s internal control over financial reporting based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Park National Corporation as of December 31, 2008 and 2007, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2008, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, Park National Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control — Integrated Framework issued by the COSO.

/s/ Crowe Horwath LLP
Crowe Horwath LLP
 

Columbus, Ohio
February 25, 2009

47

CONSOLIDATED BALANCE SHEETS

PARK NATIONAL CORPORATION AND SUBSIDIARIES
at December 31, 2008 and 2007 (Dollars in thousands, except per share data)

	2008			2007
ASSETS
Cash and due from banks	$	150,298		$	183,165
Money market instruments		20,963			10,232
Cash and cash equivalents		171,261			193,397
Interest bearing deposits with other banks		1			1
Investment securities:
Securities available-for-sale, at fair value (amortized cost of $1,513,223 and $1,473,052 at December 31, 2008 and 2007, respectively)		1,561,896			1,474,517
Securities held-to-maturity, at amortized cost (fair value of $433,435 and $161,414 at December 31, 2008 and 2007, respectively)		428,350			165,421
Other investment securities		68,805			63,165
Total investment securities		2,059,051			1,703,103
Total loans		4,491,337			4,224,134
Allowance for loan losses		(100,088	)		(87,102	)
Net loans		4,391,249			4,137,032
Other assets:
Bank owned life insurance		132,916			119,472
Goodwill		72,334			127,320
Other intangibles		13,211			17,236
Premises and equipment, net		68,553			66,634
Accrued interest receivable		27,930			30,646
Other real estate owned		25,848			13,443
Mortgage loan servicing rights		8,306			10,204
Other		100,060			82,614
Total other assets		449,158			467,569
Total assets	$	7,070,720		$	6,501,102

The accompanying notes are an integral part of the financial statements.

48

CONSOLIDATED BALANCE SHEETS (CONTINUED)

PARK NATIONAL CORPORATION AND SUBSIDIARIES
at December 31, 2008 and 2007 (Dollars in thousands, except per share data)

	2008			2007
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Noninterest bearing	$	782,625		$	695,466
Interest bearing		3,979,125			3,743,773
Total deposits		4,761,750			4,439,239
Short-term borrowings		659,196			759,318
Long-term debt		855,558			590,409
Subordinated debentures		40,000			40,000
Total borrowings		1,554,754			1,389,727
Other liabilities:
Accrued interest payable		11,335			15,125
Other		100,218			76,999
Total other liabilities		111,553			92,124
Total liabilities		6,428,057			5,921,090
COMMITMENTS AND CONTINGENCIES
Stockholders’ equity:
Preferred stock (200,000 shares authorized in 2008 and 0 in 2007; 100,000 shares issued in 2008 with $1,000 per share liquidation preference and 0 issued in 2007)		95,721			—
Common stock, no par value (20,000,000 shares authorized;
16,151,151 shares issued in 2008 and 16,151,200 issued in 2007)		301,210			301,213
Common stock warrant		4,297			—
Accumulated other comprehensive income (loss), net		10,596			(2,608	)
Retained earnings		438,504			489,511
Less: Treasury stock (2,179,424 shares in 2008 and 2,186,624 shares in 2007)		(207,665	)		(208,104	)
Total stockholders’ equity		642,663			580,012
Total liabilities and stockholders’ equity	$	7,070,720		$	6,501,102

The accompanying notes are an integral part of the financial statements.

49

CONSOLIDATED STATEMENTS OF INCOME

PARK NATIONAL CORPORATION AND SUBSIDIARIES
for the years ended December 31, 2008, 2007 and 2006 (Dollars in thousands, except per share data)

	2008		2007		2006
Interest and dividend income:
Interest and fees on loans	$	301,163	$	320,827	$	255,123
Interest and dividends on:
Obligations of U.S. Government, its agencies and other securities		87,711		77,016		75,300
Obligations of states and political subdivisions		2,171		3,061		3,667
Other interest income		294		920		469
Total interest and dividend income		391,339		401,824		334,559
Interest expense:
Interest on deposits:
Demand and savings deposits		22,633		39,797		25,870
Time deposits		67,259		81,224		56,402
Interest on short-term borrowings		14,469		22,113		15,692
Interest on long-term debt		31,105		24,013		23,351
Total interest expense		135,466		167,147		121,315
Net interest income		255,873		234,677		213,244
Provision for loan losses		70,487		29,476		3,927
Net interest income after provision for loan losses		185,386		205,201		209,317
Other income:
Income from fiduciary activities		13,937		14,403		13,548
Service charges on deposit accounts		24,296		23,813		19,969
Net gains on sales of securities		1,115		—		97
Other service income		8,882		11,543		10,920
Net gain on sale of credit card portfolio		7,618		—		—
Income from sale of merchant processing		4,200		—		—
Other		24,786		21,881		20,228
Total other income	$	84,834	$	71,640	$	64,762

The accompanying notes are an integral part of the financial statements.

50

CONSOLIDATED STATEMENTS OF INCOME (CONTINUED)

PARK NATIONAL CORPORATION AND SUBSIDIARIES
for the years ended December 31, 2008, 2007 and 2006 (Dollars in thousands, except per share data)

	2008		2007		2006
Other expense:
Salaries and employee benefits	$	99,018	$	97,712	$	82,579
Goodwill impairment charge		54,986		54,035		—
Data processing fees		7,121		6,892		4,246
Fees and service charges		12,801		11,055		9,553
Net occupancy expense of bank premises		11,534		10,717		9,155
Amortization of intangibles		4,025		3,847		2,470
Furniture and equipment expense		9,756		9,259		8,215
Insurance		2,322		1,445		1,137
Marketing		4,525		4,961		4,438
Postage and telephone		7,167		6,910		6,303
State taxes		2,989		2,769		2,333
Other		18,257		14,562		10,573
Total other expense		234,501		224,164		141,002
Income before income taxes		35,719		52,677		133,077
Income taxes		22,011		29,970		38,986
Net income	$	13,708	$	22,707	$	94,091
Preferred stock dividends		142		—		—
Income available to common shareholders	$	13,566	$	22,707	$	94,091
Earnings per common share:
Basic	$	0.97	$	1.60	$	6.75
Diluted	$	0.97	$	1.60	$	6.74

The accompanying notes are an integral part of the financial statements.

51

CONSOLIDATED STATEMENTS OF

CHANGES IN STOCKHOLDERS ‘ EQUITY

PARK NATIONAL CORPORATION AND SUBSIDIARIES
for the years ended December 31, 2008, 2007 and 2006 (Dollars in thousands, except per share data)

	Preferred Stock					Common Stock												Accumulated
																		Other
	Shares					Shares						Retained			Treasury			Comprehensive						Comprehensive
	Outstanding		Amount			Outstanding			Amount			Earnings			Stock			Income (Loss)			Total			Income
Balance, January 1, 2006		—	$	0			14,092,626		$	208,365		$	476,889		$	(116,681	)	$	(10,143	)	$	558,430
Net income							—			—			94,091			—			—			94,091		$	94,091
Other comprehensive income (loss), net of tax:
Unrealized net holding loss on securities available-for-sale, net of income taxes of $(3,151)																			(5,851	)		(5,851	)		(5,851	)
Total comprehensive income																								$	88,240
Adjustment to initially apply SFAS No. 158, net of income taxes of $(3,675)																			(6,826	)		(6,826	)
Cash dividends, $3.69 per share							—			—			(51,417	)		—			—			(51,417	)
Cash payment for fractional shares in dividend reinvestment plan							(72	)		(5	)		—			—			—			(5	)
Shares issued for stock options							684			42			—			—			—			42
Treasury stock purchased							(302,786	)		—			—			(30,508	)		—			(30,508	)
Treasury stock reissued for stock options exercised and other grants							44,940			—			—			3,818			—			3,818
Shares issued for Anderson Bank purchase							86,137			8,665			—			—			—			8,665
Balance, December 31, 2006		—	$	0			13,921,529		$	217,067		$	519,563		$	(143,371	)	$	(22,820	)	$	570,439
Net income							—			—			22,707			—			—			22,707		$	22,707
Other comprehensive income (loss), net of tax:
Change in funded status of pension plan, net of income taxes of $1,759																			3,266			3,266			3,266
Unrealized net holding gain on securities available-for-sale, net of income taxes of $9,125																			16,946			16,946			16,946
Total comprehensive income																								$	42,919
Cash dividends, $3.73 per share							—			—			(52,759	)		—			—			(52,759	)
Cash payment for fractional shares in dividend reinvestment plan							(60	)		(5	)		—			—			—			(5	)
Stock options granted							—			893			—			—			—			893
Treasury stock purchased							(760,531	)		—			—			(65,568	)		—			(65,568	)
Treasury stock reissued for stock options exercised and other grants							10,701			—			—			835			—			835
Shares issued for Vision Bancshares, Inc. purchase							792,937			83,258			—			—			—			83,258
Balance, December 31, 2007		—	$	0			13,964,576		$	301,213		$	489,511		$	(208,104	)	$	(2,608	)	$	580,012
Net income													13,708			—			—			13,708		$	13,708
Other comprehensive income (loss), net of tax:
Change in funded status of pension plan, net of income taxes of $(8,735)																			(16,223	)		(16,223	)		(16,223	)
Unrealized net holding loss on cash flow hedge, net of income taxes of $(678)																			(1,259	)		(1,259	)		(1,259	)
Unrealized net holding gain on securities available-for-sale, net of income taxes of $16,522																			30,686			30,686			30,686
Total comprehensive income																								$	26,912
Cash dividends, $3.77 per share							—			—			(52,608	)		—			—			(52,608	)
Cash payment for fractional shares in dividend reinvestment plan							(49	)		(3	)		—			—			—			(3	)
Cumulative effect of new accounting pronouncement pertaining to endorsement split-dollar life insurance													(11,634	)								(11,634	)
SFAS No. 158 measurement date adjustment, net of taxes of $(178)													(331	)								(331	)
Preferred stock issued		100,000		100,000																		100,000
Discount on preferred stock issued				(4,297	)																	(4,297	)
Amortization of discount on preferred stock				18									(18	)								—
Common stock warrant issued							—			4,297												4,297
Preferred stock dividends													(124	)								(124	)
Treasury stock reissued for director grants							7,200									439						439
Balance, December 31, 2008		100,000	$	95,721			13,971,727		$	305,507		$	438,504		$	(207,665	)	$	10,596		$	642,663

The accompanying notes are an integral part of the financial statements.

52

CONSOLIDATED STATEMENTS OF CASH FLOWS

PARK NATIONAL CORPORATION AND SUBSIDIARIES
for the years ended December 31, 2008, 2007 and 2006 (Dollars in thousands)

	2008			2007			2006
Operating activities:
Net income	$	13,708		$	22,707		$	94,091
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses		70,487			29,476			3,927
Amortization of loan fees and costs, net		(4,650	)		(5,935	)		(4,340	)
Provision for depreciation and amortization		7,517			6,480			5,522
Other than temporary impairment on investment securities		980			—			—
Goodwill impairment charge		54,986			54,035			—
Amortization of intangible assets		4,025			3,847			2,470
Accretion of investment securities		(1,592	)		(3,009	)		(1,630	)
Gain on sale of credit card portfolio		(7,618	)		—			—
Deferred income tax (benefit) expense		(1,590	)		(7,839	)		156
Realized net investment security (gains)		(1,115	)		—			(97	)
Stock based compensation expense		—			893			—
Stock dividends on Federal Home Loan Bank stock		(2,269	)		—			(3,101	)
Changes in assets and liabilities:
Increase in other assets		(42,406	)		(11,975	)		(14,606	)
Increase (decrease) in other liabilities		239			(5,492	)		2,858
Net cash provided by operating activities		90,702			83,188			85,250
Investing activities:
Proceeds from sales of available-for-sale securities		80,894			—			304
Proceeds from maturities of securities:
Held-to-maturity		7,116			11,063			19,471
Available-for-sale		303,160			700,582			293,207
Purchase of securities:
Held-to-maturity		(270,045	)		—			—
Available-for-sale		(422,512	)		(842,598	)		(166,518	)
Proceeds from sale of credit card portfolio		38,841			—			—
Net decrease (increase) in other investments		(3,371	)		180			(532	)
Net decrease in interest bearing deposits with other banks		—			—			299
Net increase in loans		(351,277	)		(126,005	)		(99,316	)
Proceeds from loans purchased with branch office		—			(38,348	)		—
Cash (paid) received for acquisition, net		—			(47,686	)		5,177
Purchases of bank owned life insurance, net		(8,401	)		—			—
Purchases of premises and equipment, net		(9,436	)		(16,331	)		(4,311	)
Premises and equipment acquired in branch acquisitions		—			(1,150	)		—
Net cash (used in) provided by investing activities		(635,031	)		(360,293	)		47,781
Financing activities:
Net increase in deposits		322,511			13,198			6,320
Deposits purchased with branch office		—			23,466			—
Net (decrease) increase in short-term borrowings		(100,122	)		359,213			61,699
Cash payment for fractional shares of common stock		(3	)		(5	)		(5	)
Exercise of stock options, including tax benefits		—			—			42
Issuance of preferred stock and common stock warrant		100,000			—			—
Issuance (purchase) of treasury stock, net		439			(64,733	)		(26,690	)
Proceeds from issuance of subordinated debt		—			25,000			—
Proceeds from long-term debt		690,100			378,100			300,000
Repayment of long-term debt		(424,951	)		(397,460	)		(410,644	)
Cash dividends paid		(65,781	)		(52,533	)		(51,470	)
Net cash provided by (used in) financing activities		522,193			284,246			(120,748	)
(Decrease) increase in cash and cash equivalents		(22,136	)		7,141			12,283
Cash and cash equivalents at beginning of year		193,397			186,256			173,973
Cash and cash equivalents at end of year	$	171,261		$	193,397		$	186,256
Supplemental disclosure
Summary of business acquisition:
Fair value of assets acquired	$	—		$	686,512		$	69,717
Cash paid for the purchase of financial institutions		—			(87,843	)		(9,052	)
Stock issued for the purchase of financial institutions		—			(83,258	)		(8,665	)
Fair value of liabilities assumed		—			(624,432	)		(62,638	)
Goodwill recognized	$	—		$	(109,021	)	$	(10,638	)

The accompanying notes are an integral part of the financial statements.

53

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed in the preparation of the consolidated financial statements:

Principles of Consolidation

The consolidated financial statements include the accounts of Park National Corporation (“Park” or the “Corporation”) and all of its subsidiaries. Material intercompany accounts and transactions have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The allowance for loan losses and the accounting for goodwill are particularly subject to change.

Reclassifications

Certain prior year amounts have been reclassified to conform with the current year presentation.

Investment Securities

Investment securities are classified upon acquisition into one of three categories: Held-to-maturity, available-for-sale, or trading (see Note 4 of these Notes to Consolidated Financial Statements).

Held-to-maturity securities are those securities that the Corporation has the positive intent and ability to hold to maturity and are recorded at amortized cost. Available-for-sale securities are those securities that would be available to be sold in the future in response to the Corporation’s liquidity needs, changes in market interest rates, and asset-liability management strategies, among others. Available-for-sale securities are reported at fair value, with unrealized holding gains and losses excluded from earnings but included in other comprehensive income, net of applicable taxes. The Corporation did not hold any trading securities during any period presented.

Available-for-sale and held-to-maturity securities are evaluated quarterly for potential other-than-temporary impairment. Management considers the facts of each security including the nature of the security, the amount and duration of the loss, credit quality of the issuer, the expectations for that security’s performance and Park’s intent and ability to hold the security until recovery. A decline in value that is considered to be other-than-temporary is recorded as a charge to earnings in the Consolidated Statements of Income.

Other investment securities (as shown on the balance sheet) consist of stock investments in the Federal Home Loan Bank and the Federal Reserve Bank.

Interest income includes amortization of purchase premium or discount. Premiums and discounts on securities are amortized on the level-yield method without anticipating prepayments, except for mortgage-backed securities where prepayments are anticipated.

Gains and losses realized on the sale of investment securities have been accounted for on the trade date in the year of sale on a specific identification basis.

Federal Home Loan Bank (FHLB) Stock

Park’s two separately chartered banks are members of the FHLB system. Members are required to own a certain amount of stock based on their level of borrowings and other factors and may invest in additional amounts. FHLB stock is carried at cost, classified as a restricted security, and periodically evaluated for impairment based on the ultimate recovery of the par value. Both cash and stock dividends are reported as income.

Bank Owned Life Insurance

Park has purchased life insurance policies on directors and certain key officers. Bank owned life insurance is recorded at its cash surrender value (or the amount that can be realized).

Mortgage Loans Held for Sale

Mortgage loans held for sale are carried at the lower of cost or fair value, determined using an aggregate basis. Write-downs to fair value are recognized as a charge to earnings at the time the decline in value occurs. Mortgage loans held for sale were $9.6 million at December 31, 2008 and $10.0 million at December 31, 2007. These amounts are included in loans on the balance sheet. The Corporation enters into forward commitments to sell mortgage loans to reduce market risk on mortgage loans in the process of origination and mortgage loans held for sale. Gains and losses resulting from sales of mortgage loans are recognized when the respective loans are sold to investors. Gains and losses are determined by the difference between the selling price and the carrying amount of the loans sold, net of discounts collected or paid and considering a normal servicing rate.

Loans

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff, are reported at their outstanding principal balances adjusted for any charge-offs, any deferred fees or costs on originated loans, and any unamortized premiums or discounts on purchased loans. Interest income is reported on the interest method and includes amortization of net deferred loan fees and costs over the loan term. Generally, commercial loans are placed on nonaccrual status at 90 days past due and consumer and residential mortgage loans are placed on nonaccrual status at 120 days past due. Interest on these loans is considered a loss, unless the loan is well-secured and in the process of collection. Commercial loans placed on nonaccrual status are considered impaired under SFAS No. 114, as amended by SFAS No. 118 (see Note 5 of these Notes to Consolidated Financial Statements). For loans which are on nonaccrual status, it is Park’s policy to reverse interest previously accrued on the loan against interest income. Interest on such loans is thereafter recorded on a cash basis and is included in earnings only when actually received in cash and when full payment of principal is no longer doubtful.

The delinquency status of a loan is based on contractual terms and not on how recently payments have been received. Loans are removed from nonaccrual status when loan payments have been received to cure the delinquency status and the loan is deemed to be well-secured by management.

Allowance for Loan Losses

The allowance for loan losses is that amount believed adequate to absorb probable incurred credit losses in the loan portfolio based on management’s evaluation of various factors, including overall growth in the loan portfolio, an analysis of individual loans, prior and current loss experience and current economic conditions. A provision for loan losses is charged to operations based on management’s periodic evaluation of these and other pertinent factors.

Loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed. Generally, consumer loans and deficiency balances for residential mortgage loans are charged off at 120 days past due. The charge off of commercial loans requires significant judgment. Subsequent recoveries, if any, are credited to the allowance.

Statement of Financial Accounting Standards (“SFAS”) No. 114, “Accounting by Creditors for Impairment of a Loan,” as amended by SFAS No. 118, “Accounting by Creditors for Impairment of a Loan—Income Recognition and Disclosure” requires an allowance to be established as a component of the allowance for loan losses for certain loans when it is probable that all amounts due pursuant to the contractual terms of the loan will not be collected, and the recorded investment in the loan exceeds the fair value. Fair value is measured using either the present value of expected future cash flows based upon the initial effective interest rate on the loan, the observable market price of the loan or the fair value of the collateral, if the loan is collateral dependent. Management’s practice is typically to record partial charge-offs to commercial loans to reduce the recorded investment in the loan to fair value.

54

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Commercial loans are individually risk graded. Where appropriate, reserves are allocated to individual loans based on management’s estimate of the borrower’s ability to repay the loan given the availability of collateral and other sources of cash flow. Homogenous loans, such as consumer installment loans, residential mortgage loans and automobile leases are not individually risk graded. Reserves are established for each pool of loans based on environmental factors. Such environmental factors include: historical loan loss experience; current economic conditions; loan delinquency; and experience, ability and depth of lending management and staff.

Income Recognition

Income earned by the Corporation and its subsidiaries is recognized on the accrual basis of accounting, except for late charges on loans which are recognized as income when they are collected.

Premises and Equipment

Premises and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is generally provided on the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized over the lives of the respective leases or the estimated useful lives of the improvements, whichever are the shorter periods. Upon the sale or other disposal of the assets, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized. Maintenance and repairs are charged to expense as incurred while renewals and improvements are capitalized.

The range of depreciable lives over which premises and equipment are being depreciated are:

Buildings	5 to 50 Years
Equipment, furniture and fixtures	3 to 20 Years
Leasehold improvements	1 to 10 Years

Buildings that are currently placed in service are depreciated over 30 years. Equipment, furniture and fixtures that are currently placed in service are depreciated over 3 to 12 years. Leasehold improvements are depreciated over the lives of the leases which range from 1 to 10 years.

Other Real Estate Owned

Other real estate owned is recorded at fair market value (which is the estimated net realizable value) and consists of property acquired through foreclosure and real estate held for sale. Subsequent to acquisition, write-downs to other real estate owned result if carrying values exceed fair value less estimated costs to sell. These write-downs are expensed within “other expense.” Costs relating to development and improvement of such properties are capitalized (not in excess of fair value less estimated costs to sell) and costs relating to holding the properties are charged to expense.

Mortgage Loan Servicing Rights

When Park sells mortgage loans with servicing rights retained, the total cost of the mortgage loan is allocated to the servicing rights and the loans based on their relative fair values. Park adopted SFAS No. 156, “Accounting for Servicing of Financial Assets—an amendment of FASB Statement No. 140,” on January 1, 2007, and selected the “amortization method,” whereby the servicing rights capitalized are amortized in proportion to and over the period of estimated future servicing income of the underlying loan. Capitalized mortgage servicing rights totaled $8.3 million at December 31, 2008 and $10.2 million at December 31, 2007. The estimated fair values of capitalized mortgage servicing rights were $8.3 million at December 31, 2008 and $11.6 million at December 31, 2007. The fair value of mortgage servicing rights is determined by discounting estimated future cash flows from the servicing assets, using market discount rates, and using expected future prepayment rates. In order to calculate fair value, the sold loan portfolio is stratified into homogenous pools of like categories.

Mortgage servicing rights are assessed for impairment periodically, based on fair value, with any impairment recognized through a valuation allowance. Fees received for servicing mortgage loans owned by investors are based on a percentage of the outstanding monthly principal balance of such loans and are included in income as loan payments are received. The cost of servicing loans is charged to expense as incurred.

Goodwill and Other Intangible Assets

Goodwill represents the excess of the purchase price over net identifiable tangible and intangible assets acquired in a purchase business combination. Other intangible assets represent purchased assets that have no physical property but represent some future economic benefit to its owner and are capable of being sold or exchanged on their own or in combination with a related asset or liability.

Goodwill and indefinite-lived intangible assets are not amortized to expense, but are subject to annual impairment tests, or more frequently if events or changes in circumstances indicate that the asset might be impaired. Intangible assets with definitive useful lives (such as core deposit intangibles) are amortized to expense over their estimated useful life.

Management considers several factors when performing the annual impairment tests on goodwill. The factors considered include the operating results for the particular Park segment for the past year and the operating results budgeted for the current year (including multi-year projections), the purchase prices being paid for financial institutions in the markets served by the subsidiary banks, the deposit and loan totals of the Park segment and the economic conditions in the markets served by the Park segment.

The following table reflects the activity in goodwill and other intangible assets for the years 2008, 2007 and 2006. (See Note 2 of these Notes to Consolidated Financial Statements for details on the acquisitions of Vision Bancshares, Inc. (“Vision”), Anderson Bank Company (“Anderson”) and the Millersburg branch of Ohio Legacy Bank N.A. and the recognition of both impairment charges to Vision bank’s goodwill).

				Core Deposit
(In thousands)	Goodwill			Intangibles			Total
January 1, 2006	$	61,696		$	7,492		$	69,188
Anderson Acquisition		10,638			647			11,285
Amortization		—			(2,470	)		(2,470	)
December 31, 2006	$	72,334		$	5,669		$	78,003
Vision Acquisition		109,021			12,720			121,741
Millersburg Branch Acquisition		—			2,694			2,694
Amortization		—			(3,847	)		(3,847	)
Impairment of Vision Goodwill		(54,035	)		—			(54,035	)
December 31, 2007	$	127,320		$	17,236		$	144,556
Amortization		—			(4,025	)		(4,025	)
Impairment of Vision Goodwill		(54,986	)		—			(54,986	)
December 31, 2008	$	72,334		$	13,211		$	85,545

SFAS No. 142, “Goodwill and Other Intangible Assets” (“SFAS No. 142”), requires a company to perform an impairment test on goodwill annually, or more frequently if events or changes in circumstances indicate that the asset might be impaired, by comparing the fair value of such goodwill to its recorded or carrying amount. If the carrying amount of the goodwill exceeds the fair value, an impairment charge must be recorded in an amount equal to the excess.

Park typically evaluates goodwill for impairment during the first quarter of each year. A determination was made during the first quarter of 2008 that goodwill for Park’s Ohio-based banks was not impaired.

During the fourth quarter of 2007, Park’s management determined that the goodwill from the Vision acquisition on March 9, 2007 could possibly be impaired due to the significant deterioration in the credit condition of Vision Bank. Nonperforming loans at Vision Bank increased from $26.3 million at September 30, 2007 to $63.5 million at December 31, 2007, or 9.9% of year-end loan balances. Net loan charge-offs were $6.4 million for the fourth quarter or an annualized 3.99% of average loan balances. Management determined that due to severe credit conditions that a valuation of the fair value of Vision Bank be computed to determine if the goodwill of $109.0 million was impaired as of December 31, 2007.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

At December 31, 2007, management calculated the estimated fair value of Vision Bank to be $123.0 million, based on four equally weighted tests: (i) on-going earnings multiplied by a price to earnings multiple; (ii) tangible book multiplied by a price to tangible book ratio; (iii) core deposit premium added to tangible book; and (iv) discounted future cash flows. Once it is determined that the fair value is materially less than the carrying value, FAS 142 requires a company to calculate the implied fair value of goodwill and compare it to the carrying amount of goodwill. The amount of the excess of the carrying amount of goodwill over the implied amount of goodwill is the amount of the impairment loss, which was calculated as $54.0 million by Park management. After the impairment charge, the new carrying amount of goodwill resulting from the Vision acquisition was $55.0 million at December 31, 2007.

The balance of goodwill was $127.3 million at December 31, 2007 and was located at four subsidiary banks of Park. The subsidiary banks were Vision Bank ($55.0 million), The Park National Bank ($39.0 million), Century National Bank ($25.8 million) and The Security National Bank and Trust Co. ($7.5 million).

Based primarily on the increased level of net loan charge-offs at Vision Bank during the second quarter of 2008, management determined that it was appropriate to test for goodwill impairment during the third quarter of 2008. Park continued to experience credit deterioration in Vision Bank’s market place during the third quarter of 2008. The fair value of Vision was estimated by using the average of three measurement methods. These included application of various metrics from bank sale transactions for institutions comparable to Vision Bank, including application of a market-derived multiple of tangible book value and estimations of the present value of future cash flows. Park’s management reviewed the valuation of Vision Bank with Park’s Board of Directors and concluded that Vision Bank should recognize an impairment charge and write down the remaining value of the goodwill previously recorded as a result of the merger of Vision Bancshares, Inc. (“Vision”) into Park ($55.0 million), resulting in goodwill with a balance of zero with respect to the Vision Bank reporting unit.

Goodwill and other intangible assets (as shown on the balance sheet) totaled $85.5 million at December 31, 2008 and $144.6 million at December 31, 2007.

The core deposit intangibles are being amortized to expense principally on the straight-line method, over periods ranging from six to ten years. The amortization period for each of the Vision and Anderson acquisitions, and the Millersburg branch acquisition is six years. Core deposit intangible amortization expense was $4.0 million in 2008, $3.8 million in 2007 and $2.5 million in 2006.

The accumulated amortization of core deposit intangibles was $8.9 million as of December 31, 2008 and $7.1 million at December 31, 2007. In addition, United Bank, a division of PNB, had core deposit intangibles of $5.7 million, which were fully amortized by the end of 2007. Park’s banking divisions had two branch offices in 2006 for which the core deposit intangibles were fully amortized. These intangibles totaled $4.6 million. The expected core deposit intangible amortization expense for each of the next five years is as follows:

(In thousands)
2009	$	3,746
2010		3,422
2011		2,677
2012		2,677
2013		689
Total	$	13,211

Consolidated Statement of Cash Flows

Cash and cash equivalents include cash and cash items, amounts due from banks and money market instruments. Generally money market instruments are purchased and sold for one-day periods.

Net cash provided by operating activities reflects cash payments as follows:

December 31,
(Dollars in thousands)	2008		2007		2006
Interest paid on deposits and other borrowings	$	139,256	$	167,154	$	118,589
Income taxes paid	$	28,365	$	39,115	$	34,633

Loss Contingencies and Guarantees

Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated.

Pursuant to the requirements of FASB Interpretation 45 (“FIN 45”), Park recorded a contingent legal liability of $0.9 million during the fourth quarter of 2007. This was a result of an announcement Visa, Inc. made in the fourth quarter of 2007 that it was establishing litigation reserves for the settlement of a lawsuit and for additional potential settlements with other parties. Park recorded the contingent legal liability based on Visa’s announcements and Park’s membership interest in Visa. Visa had a successful initial public offering (“IPO”) during the first quarter of 2008. Visa used a portion of the IPO proceeds to fund an escrow account that will be used to pay contingent legal settlements. As a result of the IPO, Park was able to reverse the entire contingent legal liability and recognize as income $0.9 million during the first quarter of 2008. This was reflected in other income within the consolidated statement of income for the twelve months ended December 31, 2008.

At the time of the IPO, Park held 132,876 Class B Common Shares of Visa. During the first quarter of 2008, Visa redeemed 51,373 of these shares and paid Park $2.2 million, which was recognized in other income within the consolidated statement of income for the twelve months ended December 31, 2008. The unredeemed shares are recorded at their original cost basis of zero.

Income Taxes

The Corporation accounts for income taxes using the asset and liability approach. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.

Park adopted FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes"—(“FIN 48”), on January 1, 2007. A tax position is recognized as a benefit only if it is “more-likely-than-not” that the tax position would be sustained in a tax examination being presumed to occur. The benefit recognized for a tax position that meets the “more-likely-than-not” criteria is measured based on the largest benefit that is more than 50 percent likely to be realized, taking into consideration the amounts and probabilities of the outcome upon settlement. For tax positions not meeting the “more-likely-than-not” test, no tax benefit is recorded. FIN 48 also provides guidance on disclosures and other issues. The adoption had no material effect on Park’s consolidated financial statements. As a result, there was no cumulative effect related to adopting FIN 48. As of December 31, 2008, Park had provided a liability of approximately $800,000 for unrecognized tax benefits related to various federal and state income tax matters. Park recognizes interest and penalties through the income tax provision. The total amount of interest and penalties on the date of adoption of FIN 48 was $76,000. Park is no longer subject to examination by federal taxing authorities for the tax year 2004 and the years prior.

Preferred Stock

On December 18, 2008, the Shareholders of Park voted, in a Special Meeting of Shareholders, to amend Park’s Articles of Incorporation to authorize the issuance of up to 200,000 preferred shares, each without par value.

56

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

On December 23, 2008, Park issued $100 million of Senior Preferred Shares to the U.S. Department of Treasury (“the Treasury”), consisting of 100,000 shares, each with a liquidation preference of $1,000 per share. In addition, on December 23, 2008, Park issued a warrant to the Treasury to purchase 227,376 common shares. These preferred shares and related warrant are considered permanent equity for accounting purposes. Generally accepted accounting principles require management to allocate the proceeds from the issuance of the preferred stock between the preferred stock and related warrant. The terms of the preferred shares require management to pay a cumulative dividend at the rate of 5 percent per annum for the first five years and 9 percent thereafter. Management has determined that the 5 percent dividend rate is below market value, therefore, the fair value of the preferred shares would be less than the $100 million in proceeds. Management determined that a reasonable market discount rate is 12 percent for the fair value of preferred shares. Management used the Black-Scholes model for calculating the fair value of the warrant (and related common shares). The allocation between the preferred shares and warrant at December 23, 2008, the date of issuance, was $95.7 million and $4.3 million, respectively. The discount on the preferred of $4.3 million will be accreted through retained earnings over a 60 month period.

Treasury Stock

The purchase of Park’s common stock is recorded at cost. At the date of retirement or subsequent reissuance, the treasury stock account is reduced by the cost of such stock.

Comprehensive Income

Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale, changes in the funded status of the Company’s defined benefit pension plan, and the unrealized net holding losses on the cash flow hedge, which are also recognized as separate components of equity.

Stock Based Compensation

Compensation cost is recognized for stock options and stock awards issued to employees and directors, based on the fair value of these awards at the date of grant. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of Park’s common stock at the date of grant is used for stock awards. Compensation cost is recognized over the required service period, generally defined as the vesting period. Park did not grant any stock options during 2008 and 2006, but granted 90,000 stock options in 2007. Additionally, all stock options granted in 2007 became vested that year. No stock options became vested in 2008.

Derivative Instruments

SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities” (“SFAS No. 133”), as amended and interpreted, establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. As required by SFAS No. 133, the Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and the resulting designation. Derivatives used to hedge the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives used to hedge the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges.

Fair Value Measurement

Effective January 1, 2008, Park adopted SFAS No. 157 “Fair Value Measurements.” SFAS No. 157 defines fair value, establishes a framework for measuring fair value in U.S. generally accepted accounting principles and expands disclosures about fair value measurements. This Statement establishes a fair value hierarchy about the assumptions used to measure fair value and clarifies assumptions about risk and the effect of a restriction on the sale or use of an asset. SFAS No. 157 was effective for financial statements issued for fiscal years beginning after November 15, 2007. Management believes that the impact of adoption resulted in enhanced footnote disclosures; however, the adoption did not materially impact the Consolidated Balance Sheets, the Consolidated Statements of Income, the Consolidated Statements of Changes in Stockholders’ Equity, or the Consolidated Statements of Cash Flows. (See Note 21 — Fair Values of these Notes to Consolidated Financial Statements).

Accounting for Defined Benefit Pension Plan

In September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans—an amendment of FASB Statements No. 87, 88, 106 and 132R.” This statement requires an employer to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multi-employer plan) as an asset or liability in its balance sheet, beginning with year-end 2006, and to recognize changes in the funded status in the year in which the changes occur through comprehensive income beginning in 2007. Additionally, defined benefit plan assets and obligations were required to be measured as of the date of the employer’s fiscal year-end, starting in 2008. The adoption of SFAS No. 158 decreased accumulated other comprehensive income by $6,826,000, net of income taxes of $3,675,000, at December 31, 2006.

As a result of the adoption of SFAS No. 158 measurement date provisions, Park charged approximately $0.3 million to retained earnings on January 1, 2008 to reflect the after-tax expense pertaining to three months of pension plan expense.

Prior Year Misstatements

In September 2006, the Securities and Exchange Commission (SEC) released Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (“SAB 108”), which is effective for fiscal years ending on or after November 15, 2006. SAB 108 provides guidance on how the effects of prior-year uncorrected financial statement misstatements should be considered in quantifying a current year misstatement. SAB 108 requires public companies to quantify misstatements using both an income statement (rollover) and balance sheet (iron curtain) approach and evaluate whether either approach results in misstatement that, when all relevant quantitative and qualitative factors are considered, is material. If prior year errors that had been previously considered immaterial now are considered material based on either approach, no restatement is required so long as management properly applied its previous approach and all relevant facts and circumstances were considered. Upon adoption in 2006, Park had no items that required posting an adjustment to beginning retained earnings.

Adoption of New Accounting Standards

Accounting for Postretirement Benefits Pertaining to Life Insurance Arrangements: In July 2006, the Emerging Issues Task Force (“EITF”) of FASB issued a draft abstract for EITF Issue No. 06-04, “Accounting for Deferred Compensation and Postretirement Benefit Aspects of Endorsement Split-Dollar Life Insurance Arrangements” (EITF Issue No. 06-04). This draft abstract from EITF reached a consensus that for an endorsement split-dollar life insurance arrangement within the scope of this Issue, an employer should recognize a liability for future benefits in accordance with SFAS No. 106, “Employers’ Accounting for Postretirement Benefits Other Than Pensions.” The EITF concluded that a liability for the benefit obligation under SFAS No. 106 has not been settled through the purchase of an endorsement type life insurance policy. In September 2006, FASB agreed to ratify the consensus reached in EITF Issue No. 06-04. This new accounting standard was effective for fiscal years beginning after December 15, 2007.

At December 31, 2008, Park and its subsidiary banks owned $132.9 million of bank owned life insurance policies. These life insurance policies are generally subject to endorsement split-dollar life insurance arrangements.

57

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

These arrangements were designed to provide a pre-and postretirement benefit for senior officers and directors of Park and its subsidiary banks. As a result of the adoption of EITF Issue No. 06-4, there was a charge of $11.6 million to retained earnings on January 1, 2008 and a corresponding liability was recognized for the same amount.

Fair Value Measurements: In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities.” SFAS No. 159 gives entities the option to measure eligible financial assets and financial liabilities at fair value on an instrument by instrument basis, that are otherwise not permitted to be accounted for at fair value under other accounting standards. The fair value option permits companies to choose to measure eligible items at fair value at specified election dates. Subsequent changes in fair value must be reported in earnings. SFAS No. 159 is effective for financial statements issued for fiscal years beginning after November 15, 2007. The Company did not elect the fair value option for any financial assets or financial liabilities as of January 1, 2008.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements.” SFAS No. 157 defines fair value, establishes a framework for measuring fair value in United States generally accepted accounting principles and expands disclosures about fair value measurements. This Statement establishes a fair value hierarchy about the assumptions used to measure fair value and clarifies assumptions about risk and the effect of a restriction on the sale or use of an asset. SFAS No. 157 was effective for financial statements issued for fiscal years beginning after November 15, 2007. The impact of adoption has resulted in enhanced footnote disclosures.

At the February 12, 2008 FASB meeting, the FASB decided to defer the effective date of Statement 157 for all non-financial assets and non-financial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). SFAS No. 157 is effective for certain non-financial assets and liabilities for fiscal years beginning after November 15, 2008. Non-financial assets and liabilities may include (but are not limited to): (i) non-financial assets and liabilities initially valued at fair value in a business combination, but not measured at fair value in subsequent periods; (ii) reporting units measured at fair value in the first step of a goodwill impairment test described in SFAS No. 142; and (iii) non-financial assets and liabilities measured at fair value in the second step of a goodwill impairment test described in SFAS No. 142.

On October 10, 2008, the FASB issued FASB Staff Position (“FSP”) No. 157-3, “Determining the Fair Value of a Financial Asset When the Market for that Asset is Not Active.” This FSP does not change existing GAAP, but seeks to clarify how to consider various inputs in determining fair value under current market conditions consistent with the principles of SFAS No. 157. The FSP provides an example on how to calculate fair value when there is not an active market for that financial asset. Key concepts addressed include distressed sales, the use of third party pricing information, use of internal assumptions, and others. FSP 157-3 was effective upon issuance and, therefore, it applies to Park’s consolidated financial statements for the year ended December 31, 2008. The adoption of FSP 157-3 had no material impact on these financial statements.

Accounting for Written Loan Commitments Recorded at Fair Value:
On November 5, 2007, the SEC issued Staff Accounting Bulletin No. 109, “Written Loan Commitments Recorded at Fair Value through Earnings” (“SAB 109”). Previously, SAB 105, “Application of Accounting Principles to Loan Commitments,” stated that in measuring the fair value of a derivative loan commitment, a company should not incorporate the expected net future cash flows related to the associated servicing of the loan. SAB 109 supercedes SAB 105 and indicates that the expected net future cash flows related to the associated servicing of the loan should be included in measuring fair value for all written loan commitments that are accounted for at fair value through earnings. SAB 105 also indicated that internally-developed intangible assets should not be recorded as part of the fair value of a derivative loan commitment, and SAB 109 retains that view. SAB 109 was effective for derivative loan commitments issued or modified in fiscal quarters beginning after December 15, 2007. The impact of this standard was not material.

Accounting for Servicing of Financial Assets: In March 2006, FASB issued SFAS No. 156, “Accounting for Servicing of Financial Assets—an amendment of SFAS No. 140.” This Statement provides the following: 1.) revised guidance on when a servicing asset and servicing liability should be recognized; 2.) requires all separately recognized servicing assets and servicing liabilities to be initially measured at fair value, if practicable; 3.) permits an entity to elect to measure servicing assets and servicing liabilities at fair value each reporting date and report changes in fair value in earnings in the period in which the changes occur; 4.) upon initial adoption, permits a one-time reclassification of available-for-sale securities to trading securities for securities which are identified as offsetting the entity’s exposure to changes in the fair value of servicing assets or liabilities that a servicer elects to subsequently measure at fair value; and 5.) requires separate presentation of servicing assets and servicing liabilities subsequently measured at fair value in the statement of financial condition and additional footnote disclosures. For Park, SFAS No. 156 was effective January 1, 2007. The adoption of this Statement did not have a material impact on Park’s consolidated financial statements.

Recently Issued but not yet Effective Accounting Pronouncements

Accounting for Business Combinations: On December 4, 2007, the FASB issued Statement No. 141(R), “Business Combinations” (“SFAS No. 141(R)”), with the objective to improve the comparability of information that a company provides in its financial statements related to a business combination. SFAS No. 141(R) establishes principles and requirements for how the acquirer: (i) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree; (ii) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and (iii) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. The statement does not apply to combinations between entities under common control. This Statement applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008.

Disclosures about Derivative Instruments: In March 2008, FASB issued SFAS No. 161 “Disclosures about Derivative Instruments and Hedging Activities"—an amendment to SFAS No. 133. This statement requires enhanced disclosures about an entity’s derivative and hedging activities and therefore should improve the transparency of financial reporting. This new accounting standard is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. Management is still evaluating the impact of this accounting standard.

Noncontrolling Interests in Consolidated Financial Statements: In December 2007, the FASB issued Statement No. 160, “Noncontrolling Interests in Consolidated Financial Statements,” which amends Accounting Research Bulletin No. 51 “Consolidated Financial Statements” (“ARB 51”). A noncontrolling interest, also known as a “minority interest”, is the portion of equity in a subsidiary not attributable to a parent. The objective of this statement is to improve upon the consistency of financial information that a company provides in its consolidated financial statements. Consistent with SFAS No. 141(R), SFAS No. 160 is effective for fiscal years beginning on or after December 15, 2008. Management does not expect that the adoption of this Statement will have a material impact on Park’s consolidated financial statements.

2. ORGANIZATION, ACQUISITIONS, BRANCH SALE AND BRANCH PURCHASE

Park National Corporation is a multi-bank holding company headquartered in Newark, Ohio. Through its banking subsidiaries, The Park National Bank (PNB) and Vision Bank (VIS), Park is engaged in a general commercial

58

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

banking and trust business, primarily in Ohio and Baldwin County, Alabama and the panhandle of Florida. A wholly-owned subsidiary of Park, Guardian Finance Company (GFC) began operating in May 1999. GFC is a consumer finance company located in Central Ohio. PNB operates through twelve banking divisions with the Park National Division headquartered in Newark, Ohio, the Fairfield National Division headquartered in Lancaster, Ohio, The Park National Bank of Southwest Ohio & Northern Kentucky Division headquartered in Milford, Ohio, with the First-Knox National Division headquartered in Mount Vernon, Ohio, the Farmers and Savings Division headquartered in Loudonville, Ohio, the Security National Division headquartered in Springfield, Ohio, the Unity National Division headquartered in Piqua, Ohio, the Richland Bank Division headquartered in Mansfield, Ohio, the Century National Division headquartered in Zanesville, Ohio, the United Bank Division headquartered in Bucyrus, Ohio, the Second National Division headquartered in Greenville, Ohio and the Citizens National Bank Division headquartered in Urbana, Ohio. Finally, VIS operates through two banking divisions with the Vision Bank Florida Division headquartered in Panama City, Florida and the Vision Bank Alabama Division headquartered in Gulf Shores, Alabama. In the third quarter of 2008, seven separately-chartered banks in Ohio were merged into PNB. These were accounted for as internal reorganizations and had no effect on the consolidated financial statements. Before 2008, eight of the PNB divisions operated as separately-chartered banks. All of the Ohio-based banking divisions provide the following principal services: the acceptance of deposits for demand, savings and time accounts; commercial, industrial, consumer and real estate lending, including installment loans, credit cards, home equity lines of credit, commercial and auto leasing; trust services; cash management; safe deposit operations; electronic funds transfers and a variety of additional banking-related services. Vision Bank, with their two banking divisions, provide the services mentioned above, with the exception of credit cards, commercial and auto leasing, and cash management. See Note 23 of these Notes to Consolidated Financial Statements for financial information on the Corporation’s operating segments.

On March 9, 2007, Park acquired all of the stock and outstanding stock options of Vision Bancshares, Inc. for $87.8 million in cash and 792,937 shares of Park common stock valued at $83.3 million or $105.00 per share. The goodwill recognized as a result of this acquisition was $109.0 million. Management expects that the acquisition of Vision will improve the future growth rate for Park’s loans, deposits and net income. The fair value of the acquired assets of Vision was $686.5 million and the fair value of the liabilities assumed was $624.4 million at March 9, 2007. During the fourth quarter of 2007, Park recognized a $54.0 million impairment charge to the Vision goodwill. In addition, Park recognized an additional impairment charge to the remaining Vision goodwill of $55.0 million during the third quarter of 2008. The goodwill impairment charge of $55 million in 2008 reduced income tax expense by approximately $1 million. The goodwill impairment charge of $54 million in 2007 had no impact on income tax expense.

At the time of the acquisition, Vision operated two bank subsidiaries (both named Vision Bank) which became bank subsidiaries of Park on March 9, 2007. On July 20, 2007, the bank operations of the two Vision Banks were consolidated under a single charter through the merger of the Vision Bank headquartered in Gulf Shores, Alabama with and into the Vision Bank headquartered in Panama City, Florida. Vision Bank operates under a Florida banking charter and has 18 branch locations in Baldwin County, Alabama and in the Florida panhandle.

On September 21, 2007, a national bank subsidiary of Park, The First-Knox National Bank of Mount Vernon (“First-Knox”), acquired the Millersburg, Ohio banking office (the “Millersburg branch”) of Ohio Legacy Bank, N.A. (“Ohio Legacy”). First-Knox acquired substantially all of the loans administered at the Millersburg branch of Ohio Legacy and assumed substantially all of the deposit liabilities relating to the deposit accounts assigned to the Millersburg branch. The fair value of loans acquired was approximately $38 million and deposit liabilities acquired were approximately $23 million. First-Knox paid a premium of approximately $1.7 million in connection with the purchase of the deposit liabilities. First-Knox recognized a loan premium adjustment of $700,000 and a certificate of deposit adjustment of $300,000, resulting in a total increase to core deposit intangibles of $2.7 million. No goodwill was recognized as part of this transaction. In addition, First-Knox paid $900,000 for the acquisition of the branch office building that Ohio Legacy was leasing from a third party.

On December 18, 2006, Park acquired all of the stock of Anderson Bank of Cincinnati, Ohio for $9.052 million in cash and 86,137 shares of Park common stock valued at $8.665 million or $100.60 per share. Immediately following Park’s acquisition, Anderson merged with Park’s subsidiary, The Park National Bank and is being operated as part of PNB’s operating division, The Park National Bank of Southwest Ohio & Northern Kentucky. The goodwill recognized as a result of this acquisition was $10.638 million. The fair value of the acquired assets of Anderson was $69.717 million and the fair value of the liabilities assumed was $62.638 million at December 18, 2006.

3. RESTRICTIONS ON CASH AND DUE FROM BANKS

The Corporation’s two bank subsidiaries are required to maintain average reserve balances with the Federal Reserve Bank. The average required reserve balance was approximately $29.4 million at December 31, 2008 and $29.0 million at December 31, 2007. No other compensating balance arrangements were in existence at year-end.

4. INVESTMENT SECURITIES

The amortized cost and fair value of investment securities are shown in the following table. Management evaluates the investment securities on a quarterly basis for other-than-temporary impairment. No impairment charges were deemed necessary during 2007.

Management follows the principles of Staff Accounting Bulletin No. 59 (“SAB No. 59”) when performing the quarterly evaluation of investment securities for any other-than-temporary impairment. During 2008, management determined that Park’s unrealized losses in the stocks of several financial institutions were other-than-temporarily impaired due to the duration and severity of the loss. Therefore, Park recognized impairment losses of $980,000 during the twelve months ended December 31, 2008, which is recorded in “other expenses” within the Consolidated Statements of Income. These impairment losses represent the difference between the investment’s cost and fair value on December 31, 2008.

Investment securities at December 31, 2008, were as follows:

			Gross		Gross
			Unrealized		Unrealized
	Amortized		Holding		Holding		Estimated
(In thousands)	Cost		Gains		Losses		Fair Value
2008:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government agencies	$	127,628	$	1,060	$	—	$	128,688
Obligations of states and political subdivisions		26,424		503		33		26,894
U.S. Government agencies’ asset-backed securities		1,357,710		47,050		229		1,404,531
Other equity securities		1,461		428		106		1,783
Total	$	1,513,223	$	49,041	$	368	$	1,561,896
2008:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	10,294	$	79	$	—	$	10,373
U.S. Government agencies’ asset-backed securities		418,056		5,035		29		423,062
Total	$	428,350	$	5,114	$	29	$	433,435

Other investment securities (as shown on the balance sheet) consist of stock investments in the Federal Home Loan Bank and the Federal Reserve Bank. Park owned $61.9 million of Federal Home Loan Bank stock and $6.9 million of Federal Reserve stock at December 31, 2008. Park owned $56.8 million of Federal Home Loan Bank stock and $6.4 million of Federal Reserve Bank stock at December 31, 2007.

59

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Management does not believe any individual unrealized loss as of December 31, 2008 and December 31, 2007, represents an other-than-temporary impairment. The unrealized losses on debt securities are primarily the result of interest rate changes, credit spread widening on agency-issued mortgage related securities, general financial market uncertainty and unprecedented market volatility. These conditions will not prohibit Park from receiving its contractual principal and interest payments on its debt securities. The fair value of these debt securities is expected to recover as payments are received on these securities and they approach maturity.

Should the impairment of any of these securities become other-than-temporary, the cost basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment is identified.

Securities with unrealized losses at December 31, 2008, were as follows:

	Less than 12 Months				12 Months or Longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(In thousands)	Value		Losses		Value		Losses		Value		Losses
2008:
Securities Available-for-Sale
Obligations of states and political subdivisions	$	1,135	$	1	$	278	$	32	$	1,413	$	33
U.S. Government agencies’ asset-backed securities		703		6		6,850		223		7,553		229
Other equity securities		17		14		314		92		331		106
Total	$	1,855	$	21	$	7,442	$	347	$	9,297	$	368
2008:
Securities Held-to-Maturity
U.S. Government agencies’ asset- backed securities	$	156	$	1	$	42,863	$	28	$	43,019	$	29

Investment securities at December 31, 2007 were as follows:

			Gross		Gross
			Unrealized		Unrealized
	Amortized		Holding		Holding		Estimated
(In thousands)	Cost		Gains		Losses		Fair Value
2007:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government agencies	$	200,996	$	2,562	$	—	$	203,558
Obligations of states and political subdivisions		44,805		716		20		45,501
U.S. Government agencies’ asset-backed securities		1,224,958		6,292		8,115		1,223,135
Other equity securities		2,293		420		390		2,323
Total	$	1,473,052	$	9,990	$	8,525	$	1,474,517
2007:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	13,551	$	127	$	—	$	13,678
U.S. Government agencies’ asset-backed securities		151,870		2		4,136		147,736
Total	$	165,421	$	129	$	4,136	$	161,414

Securities with unrealized losses at December 31, 2007, were as follows:

	Less than 12 Months				12 Months or Longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(In thousands)	Value		Losses		Value		Losses		Value		Losses
2007:
Securities Available-for-Sale
Obligations of states and political subdivisions	$	1,302	$	18	$	120	$	2	$	1,422	$	20
U.S. Government agencies’ asset-backed securities		—		—		770,808		8,115		770,808		8,115
Other equity securities		729		291		101		99		830		390
Total	$	2,031	$	309	$	771,029	$	8,216	$	773,060	$	8,525
2007:
Securities Held-to-Maturity
U.S. Government agencies’ asset-backed securities	$	—	$	—	$	147,536	$	4,136	$	147,536	$	4,136

The amortized cost and estimated fair value of investments in debt securities at December 31, 2008, are shown in the following table by contractual maturity or the expected call date, except for asset-backed securities, which are shown as a single total, due to the unpredictability of the timing in principal repayments.

	Amortized		Estimated
(Dollars in thousands)	Cost		Fair Value
Securities Available-for-Sale
U.S. Treasury and agencies’ notes:
Due within one year	$	127,628	$	128,688
Total	$	127,628	$	128,688
Obligations of states and political subdivisions:
Due within one year	$	17,123	$	17,351
Due one through five years		5,469		5,663
Due five through ten years		2,001		2,081
Due over ten years		1,831		1,799
Total	$	26,424	$	26,894
U.S. Government agencies’ asset-backed securities:
Total	$	1,357,710		$1,404,531
Securities Held-to-Maturity
Obligations of states and political subdivisions:
Due within one year	$	9,881	$	9,945
Due one through five years		413		428
Total	$	10,294	$	10,373
U.S. Government agencies’ asset-backed securities:
Total	$	418,056	$	423,062

Investment securities having a book value of $1,751 million and $1,631 million at December 31, 2008 and 2007, respectively, were pledged to collateralize government and trust department deposits in accordance with federal and state requirements and to secure repurchase agreements sold, and as collateral for Federal Home Loan Bank (FHLB) advance borrowings.

60

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

At December 31, 2008, $939 million was pledged for government and trust department deposits, $664 million was pledged to secure repurchase agreements and $148 million was pledged as collateral for FHLB advance borrowings. At December 31, 2007, $912 million was pledged for government and trust department deposits, $667 million was pledged to secure repurchase agreements and $52 million was pledged as collateral for FHLB advance borrowings.

At year-end, there were no holdings of securities of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of shareholders’ equity.

During 2008, Park sold $140 million of U.S. Governmental Agency securities, for total gains of $1,115,000. These securities were callable during 2008 and were sold with a give up yield of approximately 3.63%. The proceeds from the sale of these investment securities were generally reinvested in U.S. Governmental Agency 15-year mortgage-backed securities. The tax expense related to the net securities gains was $357,000 for 2008. There were no sales of securities in 2007. No gross losses were realized in 2008 and 2007.

5. LOANS

The composition of the loan portfolio is as follows:

December 31 (Dollars in thousands)	2008		2007
Commercial, financial and agricultural	$	714,296	$	613,282
Real estate:
Construction		533,788		536,389
Residential		1,560,198		1,481,174
Commercial		1,035,725		993,101
Consumer, net		643,507		593,388
Leases, net		3,823		6,800
Total loans	$	4,491,337	$	4,224,134

Loans are shown net of origination deferred fees and costs of $6 million at December 31, 2008 and 2007.

Overdrawn deposit accounts of $3,636,000 and $4,287,000 have been reclassified to loans at December 31, 2008 and 2007, respectively.

Under the Corporation’s credit policies and practices, all nonaccrual and restructured commercial, financial, agricultural, construction and commercial real estate loans meet the definition of impaired loans under SFAS No. 114 and 118. Impaired loans, as defined by SFAS No. 114 and 118, exclude certain consumer loans, residential real estate loans and lease financing classified as nonaccrual. The majority of the loans deemed impaired were evaluated using the fair value of the collateral as the measurement method.

Nonperforming loans are summarized as follows:

December 31 (Dollars in thousands)	2008		2007
Impaired loans:
Nonaccrual	$	138,498	$	87,277
Restructured		2,845		2,804
Total impaired loans		141,343		90,081
Other nonaccrual loans		21,014		13,851
Total nonaccrual and restructured loans	$	162,357	$	103,932
Loans past due 90 days or more and accruing		5,421		4,545
Total nonperforming loans	$	167,778	$	108,477

Management’s general practice is to charge down impaired loans to the fair value of the underlying collateral of the loan, so no specific loss allocations are generally necessary for many of these loans. The allowance for loan losses, specifically related to impaired loans at December 31, 2008 and 2007, was $8,727,000 and $3,424,000, respectively, related to loans with principal balances of $62,929,000 and $27,218,000.

The average balance of impaired loans was $130,579,000, $51,118,000 and $21,976,000 for 2008, 2007 and 2006, respectively.

Interest income on impaired loans is recognized after all past due and current principal payments have been made, and collectibility is no longer doubtful. For the years ended December 31, 2008, 2007 and 2006, the Corporation recognized $905,000, $392,000 and $450,000, respectively, of interest income on loans that were impaired as of the end of the year.

Management transfers ownership of a loan to other real estate owned at the time that Park takes the title of the asset. At December 31, 2008 and 2007, Park had $25.8 million and $13.4 million, respectively, of other real estate owned. Other real estate owned at Vision Bank has increased from $7.1 million at December 31, 2007 to $19.7 million at December 31, 2008.

Certain of the Corporation’s executive officers, directors and their affiliates are loan customers of the Corporation’s two banking subsidiaries. As of December 31, 2008 and 2007, loans and lines of credit aggregating approximately $59,101,000 and $118,506,000, respectively, were outstanding to such parties. The decrease of $59.4 million since December 31, 2007 is due to the change in the Corporation’s executive officers and directors. Commensurate with the mergers of the eight Ohio bank charters, which occurred during the third quarter of 2008, Park significantly reduced the number of individuals considered executive officers and directors, as determined by Regulation O of Title 12 from the Federal Reserve Bank regulations.

During 2008, $17,444,000 of new loans were made and repayments totaled $3,406,000. New loans and repayments for 2007 were $35,992,000 and $29,792,000, respectively.

6. ALLOWANCE FOR LOAN LOSSES

Activity in the allowance for loan losses is summarized as follows:

(Dollars in thousands)	2008			2007			2006
Balance, January 1	$	87,102		$	70,500		$	69,694
Allowance for loan losses of acquired banks		—			9,334			798
Provision for loan losses		70,487			29,476			3,927
Losses charged to the reserve		(62,916	)		(27,776	)		(10,772	)
Recoveries		5,415			5,568			6,853
Balance, December 31	$	100,088		$	87,102		$	70,500

7. PREMISES AND EQUIPMENT

The major categories of premises and equipment and accumulated depreciation are summarized as follows:

December 31 (Dollars in thousands)	2008			2007
Land	$	21,799		$	21,789
Buildings		74,106			71,000
Equipment, furniture and fixtures		52,574			41,428
Leasehold improvements		5,553			5,474
Total		154,032			139,691
Less accumulated depreciation and amortization		(85,479	)		(73,057	)
Premises and Equipment, Net	$	68,553		$	66,634

Depreciation and amortization expense amounted to $7,517,000, $6,480,000 and $5,522,000 for the three years ended December 31, 2008, 2007 and 2006, respectively.

The Corporation and its subsidiaries lease certain premises and equipment accounted for as operating leases. The following is a schedule of the future minimum rental payments required for the next five years under such leases with initial terms in excess of one year:

(In thousands)
2009	$	2,006
2010		1,396
2011		927
2012		850
2013		1,272
Thereafter		2,870
Total	$	9,321

Rent expense was $2,802,000, $2,701,000 and $2,107,000, for the three years ended December 31, 2008, 2007 and 2006, respectively.

61

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

8. DEPOSITS

At December 31, 2008 and 2007, noninterest bearing and interest bearing deposits were as follows:

December 31 (Dollars in thousands)	2008		2007
Noninterest bearing	$	782,625	$	695,466
Interest bearing		3,979,125		3,743,773
Total	$	4,761,750	$	4,439,239

At December 31, 2008, the maturities of time deposits were as follows:

(In thousands)
2009	$	1,563,967
2010		276,115
2011		96,339
2012		109,486
2013		30,524
After 5 years		1,941
Total	$	2,078,372

Maturities of time deposits of $100,000 and over as of December 31, 2008 were:

December 31 (In thousands)
3 months or less	$	354,868
Over 3 months through 6 months		93,943
Over 6 months through 12 months		208,468
Over 12 months		149,808
Total	$	807,087

At December 31, 2008, Park had approximately $29.7 million of deposits received from executive officers, directors, and their related interests.

9. SHORT-TERM BORROWINGS

Short-term borrowings are as follows:

December 31 (Dollars in thousands)	2008		2007
Securities sold under agreements to repurchase and federal funds purchased	$	284,196	$	253,289
Federal Home Loan Bank advances		375,000		502,000
Other short-term borrowings		—		4,029
Total short-term borrowings	$	659,196	$	759,318

The outstanding balances for all short-term borrowings as of December 31, 2008, 2007 and 2006 (in thousands) and the weighted-average interest rates as of and paid during each of the years then ended are as follows:

	Repurchase						Demand
	Agreements			Federal			Notes
	and Federal			Home Loan			Due U.S.
	Funds			Bank			Treasury
(Dollars in thousands)	Purchased			Advances			and Other
2008:
Ending balance	$	284,196		$	375,000		$	—
Highest month-end balance		294,226			572,000			30,414
Average daily balance		256,877			336,561			12,008
Weighted-average interest rate:
As of year-end		1.12	%		0.71	%		0.00	%
Paid during the year		1.81	%		2.80	%		3.43	%

	Repurchase						Demand
	Agreements			Federal			Notes
	and Federal			Home Loan			Due U.S.
	Funds			Bank			Treasury
(Dollars in thousands)	Purchased			Advances			and Other
2007:
Ending balance	$	253,289		$	502,000		$	4,029
Highest month-end balance		259,065			502,000			8,058
Average daily balance		230,651			260,140			3,369
Weighted-average interest rate:
As of year-end		3.27	%		4.42	%		3.59	%
Paid during the year		3.67	%		5.19	%		4.78	%
2006:
Ending balance	$	225,356		$	142,000		$	8,417
Highest month-end balance		240,924			246,000			11,290
Average daily balance		224,662			147,145			3,525
Weighted-average interest rate:
As of year-end		3.73	%		5.24	%		5.06	%
Paid during the year		3.54	%		5.15	%		4.62	%

At December 31, 2008 and 2007, Federal Home Loan Bank (FHLB) advances were collateralized by investment securities owned by the Corporation’s subsidiary banks and by various loans pledged under a blanket agreement by the Corporation’s subsidiary banks.

See Note 4 of these Notes to Consolidated Financial Statements for the amount of investment securities that are pledged. At December 31, 2008, $1,992 million of commercial real estate and residential mortgage loans were pledged under a blanket agreement to the FHLB by Park’s subsidiary banks. At December 31, 2007, $1,865 million of commercial real estate and residential mortgage loans were pledged under a blanket agreement to the FHLB by Park’s subsidiary banks.

Note 4 states that $664 and $667 million of securities were pledged to secure repurchase agreements as of December 31, 2008 and 2007, respectively. Park’s repurchase agreements in short-term borrowings consist of customer accounts and securities which are pledged on an individual security basis. Park’s repurchase agreements with a third-party financial institution are classified in long-term debt. See Note 10 of these Notes to Consolidated Financial Statements.

10. LONG-TERM DEBT

Long-term debt is listed below:

December 31 (Dollars in thousands)	2008					2007
	Outstanding		Average			Outstanding		Average
	Balance		Rate			Balance		Rate
Total Federal Home Loan Bank advances by year of maturity:
2008	$	—		—		$	34,844		4.02	%
2009		6,208		3.79	%		6,146		3.86	%
2010		217,442		1.09	%		17,429		5.72	%
2011		1,442		4.00	%		1,436		4.01	%
2012		488		3.87	%		485		3.87	%
2013		485		4.03	%		482		4.03	%
Thereafter		302,949		3.02	%		202,993		3.83	%
Total	$	529,014		2.24	%	$	263,815		3.98	%
Total broker repurchase agreements by year of maturity:
2008	$	—		—		$	—		—
2009		25,000		3.79	%		25,000		3.79	%
2010		—		—			—		—
Thereafter		300,000		4.04	%		300,000		4.04	%
Total	$	325,000		4.02	%	$	325,000		4.02	%

62

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31 (Dollars in thousands)	2008					2007
	Outstanding		Average			Outstanding		Average
	Balance		Rate			Balance		Rate
Other borrowings by year of maturity:
2008	$	—		—		$	50		12.00	%
2009		54		12.00	%		54		12.00	%
2010		59		12.00	%		59		12.00	%
2011		63		12.00	%		63		12.00	%
2012		69		12.00	%		69		12.00	%
2013		74		12.00	%		74		12.00	%
Thereafter		1,225		12.00	%		1,225		12.00	%
Total	$	1,544		12.00	%	$	1,594		12.00	%
Total combined long-term debt by year of maturity:
2008	$	—		—		$	34,894		4.03	%
2009		31,262		3.80	%		31,200		3.81	%
2010		217,501		1.10	%		17,488		5.74	%
2011		1,505		4.34	%		1,499		4.35	%
2012		557		4.88	%		554		4.88	%
2013		559		5.09	%		556		5.09	%
Thereafter		604,174		3.55	%		504,218		3.98	%
Total	$	855,558		2.93	%	$	590,409		4.02	%

Other borrowings consist of a capital lease obligation of $1.5 million, pertaining to an arrangement that was part of the acquisition of Vision on March 9, 2007 and its associated minimum lease payments.

Park had approximately $605 million of long-term debt at December 31, 2008 with a contractual maturity longer than five years. However, approximately $500 million of this debt is callable by the issuer in 2009 and $100 million is callable by the issuer in 2010.

At December 31, 2008 and 2007, Federal Home Loan Bank (FHLB) advances were collateralized by investment securities owned by the Corporation’s subsidiary banks and by various loans pledged under a blanket agreement by the Corporation’s subsidiary banks.

See Note 4 of these Notes to Consolidated Financial Statements for the amount of investment securities that are pledged. See Note 9 of these Notes to Consolidated Financial Statements for the amount of commercial real estate and residential mortgage loans that are pledged to the FHLB.

11. SUBORDINATED DEBENTURES

As part of the acquisition of Vision on March 9, 2007, Park became the successor to Vision under (i) the Amended and Restated Trust Agreement of Vision Bancshares Trust I (the “Trust”), dated as of December 5, 2005, (ii) the Junior Subordinated Indenture, dated as of December 5, 2005, and (iii) the Guarantee Agreement, also dated as of December 5, 2005.

On December 1, 2005, Vision formed a wholly-owned Delaware statutory business trust, Vision Bancshares Trust I (“Trust I”), which issued $15.0 million of the Trust’s floating rate Preferred Securities (the “Trust Preferred Securities”) to institutional investors. These Trust Preferred Securities qualify as Tier I capital under Federal Reserve Board guidelines. All of the common securities of Trust I are owned by Park. The proceeds from the issuance of the common securities and the Trust Preferred Securities were used by Trust I to purchase $15.5 million of junior subordinated debentures, which carry a floating rate based on a three-month LIBOR plus 148 basis points. The debentures represent the sole asset of Trust I. The Trust Preferred Securities accrue and pay distributions at a floating rate of three-month LIBOR plus 148 basis points per annum. The Trust Preferred Securities are mandatorily redeemable upon maturity of the debentures in December 2035, or upon earlier redemption as provided in the debenture. Park has the right to redeem the debentures purchased by Trust I in whole or in part, on or after December 30, 2010. As specified in the indenture, if the debentures are redeemed prior to maturity, the redemption price will be the principal amount, plus any unpaid accrued interest.

In accordance with FASB Interpretation 46R, Trust I is not consolidated with Park’s financial statements, but rather the subordinated debentures are reflected as a liability.

On December 28, 2007, one of Park’s wholly-owned subsidiary banks, The Park National Bank (“PNB”), entered into a Subordinated Debenture Purchase Agreement with USB Capital Funding Corp. Under the terms of the Purchase Agreement, USB Capital Funding Corp. purchased from PNB a Subordinated Debenture dated December 28, 2007, in the principal amount of $25 million, which matures on December 29, 2017. The Subordinated Debenture is intended to qualify as Tier 2 capital under the applicable regulations of the Office of the Comptroller of the Currency of the United States of America (the “OCC”). The Subordinated Debentures accrue and pay interest at a floating rate of three-month LIBOR plus 200 basis points. The Subordinated Debenture may not be prepaid in any amount prior to December 28, 2012, however, subsequent to this date, PNB may prepay, without penalty, all or a portion of the principal amount outstanding in a minimum amount of $5 million or any larger multiple of $5 million. The three-month LIBOR rate was 1.43% at December 31, 2008.

On January 2, 2008, Park entered into an interest rate swap transaction, which was designated as a cash flow hedge against the variability of cash flows related to the Subordinated Debenture of $25 million (see Note 19 of these Notes to Consolidated Financial Statements).

12. STOCK OPTION PLANS

The Park National Corporation 2005 Incentive Stock Option Plan (the “2005 Plan”) was adopted by the Board of Directors of Park on January 18, 2005, and was approved by the shareholders at the Annual Meeting of Shareholders on April 18, 2005. Under the 2005 Plan, 1,500,000 common shares are authorized for delivery upon the exercise of incentive stock options. All of the common shares delivered upon the exercise of incentive stock options granted under the 2005 Plan are to be treasury shares. At December 31, 2008, 1,220,727 common shares were available for future grants under the 2005 Plan. Under the terms of the 2005 Plan, incentive stock options may be granted at a price not less than the fair market value at the date of the grant, and for an option term of up to five years. No additional incentive stock options may be granted under the 2005 Plan after January 17, 2015.

The Park National Corporation 1995 Incentive Stock Option Plan (the “1995 Plan”) was adopted April 17, 1995 and amended April 20, 1998 and April 16, 2001. Pursuant to the terms of the 1995 Plan, all of the common shares delivered upon exercise of incentive stock options are to be treasury shares. No incentive stock options may be granted under the 1995 Plan after January 16, 2005.

The fair value of each incentive stock option granted is estimated on the date of grant using a closed form option valuation (Black-Scholes) model that uses the assumptions noted in the table below. Expected volatilities are based on historical volatilities of Park’s common stock. The Corporation uses historical data to estimate option exercise behavior. The expected term of incentive stock options granted is based on historical data and represents the period of time that options granted are expected to be outstanding, which takes into account that the options are not transferable. The risk-free interest rate for the expected term of the incentive stock options is based on the U.S. Treasury yield curve in effect at the time of the grant.

The fair value of incentive stock options granted was determined using the following weighted-average assumptions as of the grant date. Park did not grant any options in 2008 or 2006.

	2008		2007			2006
Risk-free interest rate		—		3.99	%		—
Expected term (years)		—		5.0			—
Expected stock price volatility		—		19.5	%		—
Dividend yield		—		4.00	%		—

63

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The activity in Park’s stock option plan is listed in the following table for 2008:

			Weighted Average
	Number		Exercise Price per Share
January 1, 2008		615,191	$	100.63
Granted		—		—
Exercised		—		—
Forfeited/Expired		162,772		95.90
December 31, 2008		452,419	$	102.33

Exercisable at year end:		452,419
Weighted-average remaining contractual life:		1.5 years
Aggregate intrinsic value:	$	0

Information related to Park’s stock option plans for the past three years is listed in the following table for 2008:

(Dollars in thousands)	2008		2007		2006
Intrinsic value of options exercised	$	—	$	47	$	692
Cash received from option exercises		—		296		3,227
Tax benefit realized from option exercises		—		—		18
Weighted-average fair value of options granted per share	$	—	$	9.92	$	—

Total compensation cost that has been charged against income pertaining to the above plans was $893,000 for 2007. No expense was recognized for 2008 and 2006. The 90,000 options granted in 2007 vested immediately upon grant.

13. BENEFIT PLANS

The Corporation has a noncontributory defined benefit pension plan covering substantially all of the employees of the Corporation and its subsidiaries. The plan provides benefits based on an employee’s years of service and compensation.

The Corporation’s funding policy is to contribute annually an amount that can be deducted for federal income tax purposes using a different actuarial cost method and different assumptions from those used for financial reporting purposes. Management did not make a contribution to the defined benefit pension plan in 2008, however, management made a $20 million contribution in January 2009, which will be deductible on the 2008 tax return and as such is reflected as part of the deferred tax liabilities at December 31, 2008. See Note 14 of these Notes to Consolidated Financial Statements.

Using an accrual measurement date of December 31, 2008 and September 30, 2007, plan assets and benefit obligation activity for the pension plan are listed below:

(Dollars in thousands)	2008			2007
Change in fair value of plan assets
Fair value at beginning of measurement period	$	60,116		$	55,541
Actual return on plan assets		(16,863	)		7,827
Company contributions		0			0
Benefits paid		(4,747	)		(3,252	)
Fair value at end of measurement period	$	38,506		$	60,116
Change in benefit obligation
Projected benefit obligation at beginning of measurement period	$	51,914		$	49,700
Service cost		4,313			3,238
Interest cost		3,946			3,104
Actuarial (gain) or loss		2,378			(876	)
Benefits paid		(4,747	)		(3,252	)
Projected benefit obligation at the end of measurement period	$	57,804		$	51,914
Funded status at end of year (assets less benefit obligation)	$	(19,298	)	$	8,202

The asset allocation for the defined benefit pension plan as of the measurement date, by asset category, is as follows:

				Percentage of Plan Assets
Asset Category	Target Allocation			2008			2007
Equity securities		50% — 100	%		79	%		81	%
Fixed income and cash equivalents	remaining balance				21	%		19	%
Other		—			—			—
Total		—			100	%		100	%

The investment policy, as established by the Retirement Plan Committee, is to invest assets per the target allocation stated above. Assets will be reallocated periodically based on the investment strategy of the Retirement Plan Committee. The investment policy is reviewed periodically.

The expected long-term rate of return on plan assets is 7.75% in 2008 and 2007. This return is based on the expected return of each of the asset categories, weighted based on the median of the target allocation for each class.

The accumulated benefit obligation for the defined benefit pension plan was $49.5 million at December 31, 2008 and $43.9 million at September 30, 2007.

The weighted average assumptions used to determine benefit obligations at December 31, 2008 and September 30, 2007 were as follows:

	2008			2007
Discount rate		6.00	%		6.25	%
Rate of compensation increase		3.00	%		3.00	%

The estimated future pension benefit payments reflecting expected future service for the next ten years are shown below in thousands:

2009	$	1,213
2010		1,404
2011		1,628
2012		1,954
2013		2,301
2014 — 2018		16,646
Total	$	25,146

In 2006, Park recorded the unrecognized prior service cost and the unrecognized net actuarial loss as a reduction to prepaid benefit cost and an adjustment to accumulated other comprehensive income (loss).

The following table shows ending balances of accumulated other comprehensive income (loss) at December 31, 2008 and 2007.

(Dollars in thousands)	2008			2007
Prior service cost	$	(149	)	$	(191	)
Net actuarial loss		(30,286	)		(5,286	)
Total		(30,435	)		(5,477	)
Deferred taxes		10,652			1,917
Accumulated other comprehensive income (loss)	$	(19,783	)	$	(3,560	)

Using an actuarial measurement date of December 31, 2008 and September 30 for 2007 and 2006, components of net periodic benefit cost and other amounts recognized in other comprehensive income are as follows:

(Dollars in thousands)	2008			2007			2006
Components of net periodic benefit cost and other amounts recognized in Other Comprehensive Income
Service cost	$	3,451		$	3,238		$	3,179
Interest cost		3,157			3,104			2,886
Expected return on plan assets		(4,608	)		(4,263	)		(3,975	)
Amortization of prior service cost		34			34			14
Recognized net actuarial loss/(gain)		—			551			555
Net periodic benefit cost	$	2,034		$	2,664		$	2,659
Change to net actuarial (gain)/loss for the period	$	25,000			(4,440	)		N/A
Amortization of prior service cost		(42	)		(34	)		N/A
Amortization of net gain/(loss)		0			(551	)		N/A
Total recognized in other comprehensive income		24,958			(5,025	)		N/A
Total recognized in net benefit cost and other comprehensive (income)	$	26,992		$	(2,361	)		N/A

64

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The estimated prior service costs for the defined benefit pension plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year is $34,000. The estimated net actuarial gain (loss) expected to be recognized in the next fiscal year is $(2,042,000).

The weighted average assumptions used to determine net periodic benefit cost for the years ended December 31, 2008 and 2007, are listed below:

	2008			2007
Discount rate		6.25	%		6.08	%
Rate of compensation increase		3.00	%		3.50	%
Expected long-term return on plan assets		7.75	%		7.75	%

The defined benefit pension plan maintains cash in a Park savings account, with a balance of $2,057,000 at December 31, 2008.

The Corporation has a voluntary salary deferral plan covering substantially all of its employees. Eligible employees may contribute a portion of their compensation subject to a maximum statutory limitation. The Corporation provides a matching contribution established annually by the Corporation. Contribution expense for the Corporation was $1,731,000, $1,734,000, and $1,672,000 for 2008, 2007 and 2006, respectively.

The Corporation has a Supplemental Executive Retirement Plan (SERP) covering certain key officers of the Corporation and its subsidiaries with defined pension benefits in excess of limits imposed by federal tax law. At December 31, 2008 and 2007, the accrued benefit cost for this plan totaled $7,550,000 and $7,701,000, respectively. The expense for the Corporation was $594,200, $684,000 and $647,000 for 2008, 2007, and 2006, respectively.

14. INCOME TAXES

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Corporation’s deferred tax assets and liabilities are as follows:

December 31 (Dollars in thousands)	2008		2007
Deferred tax assets:
Allowance for loan losses	$	35,929	$	31,133
Accumulated other comprehensive loss — SFAS 133		678		—
Accumulated other comprehensive loss — SFAS 158		10,652		1,917
Intangible assets		3,357		2,895
Deferred compensation		4,539		4,504
Other		5,693		5,153
Total deferred tax assets	$	60,848	$	45,602
Deferred tax liabilities:
Accumulated other comprehensive income — SFAS 115	$	17,036	$	513
Deferred investment income		11,168		11,346
Pension plan		10,875		4,713
Mortgage servicing rights		2,907		3,571
Purchase accounting adjustments		4,493		5,264
Other		1,440		1,924
Total deferred tax liabilities	$	47,919	$	27,331
Net deferred tax asset	$	12,929	$	18,271

The components of the provision for federal and state income taxes are shown below:

December 31 (Dollars in thousands)	2008			2007			2006
Currently payable
Federal	$	23,645		$	37,692		$	38,830
State		(44	)		117			—
Deferred
Federal		697			(7,269	)		156
State		(2,287	)		(570	)		—
Total	$	22,011		$	29,970		$	38,986

The following is a reconcilement of federal income tax expense to the amount computed at the statutory rate of 35% for the years ended December 31, 2008, 2007 and 2006.

December 31	2008			2007			2006
Statutory federal corporate tax rate		35.0	%		35.0	%		35.0	%
Changes in rates resulting from:
Tax-exempt interest income, net of disallowed interest		(3.5	%)		(2.6	%)		(1.2	%)
Bank owned life insurance		(5.0	%)		(2.8	%)		(1.0	%)
Tax credits (low income housing)		(11.7	%)		(7.5	%)		(2.9	%)
Goodwill impairment		50.7	%		35.9	%		—
State income tax expense, net of federal benefit		(4.2	%)		(.6	%)		—
Other		.3	%		(.5	%)		(.6	%)
Effective tax rate		61.6	%		56.9	%		29.3	%

Park and its Ohio-based subsidiary banks do not pay state income tax to the state of Ohio, but pay a franchise tax based on their year-end equity. The franchise tax expense is included in the state tax expense and is shown in “state taxes” on Park’s Consolidated Statements of Income. Vision Bank is subject to state income tax, in the states of Alabama and Florida. State income tax expense (benefit) for Vision Bank is included in “income taxes” on Park’s Consolidated Statements of Income. Vision Bank’s 2008 state income tax benefit was $(2,331,000).

Unrecognized Tax Benefits

The following is a reconciliation of the beginning and ending amount of unrecognized tax benefits.

(Dollars in thousands)	2008			2007
January 1 Balance	$	828		$	713
Additions based on tax positions related to the current year		102			250
Additions for tax positions of prior years		18			17
Reductions for tax positions of prior years		(15	)		(24	)
Reductions due to the statute of limitations		(150	)		(128	)
December 31, 2008 Balance	$	783		$	828

The amount of unrecognized tax benefits that, if recognized, would favorably affect the effective income tax rate in the future periods at Decembeer 31, 2008 and 2007 is $571,000 and $578,000, respectively. Park does not expect the total amount of unrecognized tax benefits to significantly increase or decrease during the next year.

The total amount of interest and penalties recorded in the income statement for the years ended December 31, 2008 and December 31, 2007 was $16,000 and $(3,000), respectively. The amount accrued for interest and penalties at December 31, 2008 and 2007 was $89,000 and $73,000, respectively.

Park and its subsidiaries are subject to U.S. federal income tax. Some of Park’s subsidiaries are subject to state income tax in the following states: Alabama, Florida, California, Kentucky, Michigan, New Jersey, Pennsylvania and West Virginia. Park is no longer subject to examination by federal or state taxing authorities for the tax year 2004 and the years prior.

The 2006 and 2007 federal income tax returns of Vision Bancshares, Inc. are currently under examination by the Internal Revenue Service. No significant adjustments are anticipated to result from this examination.

65

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

15. OTHER COMPREHENSIVE INCOME (LOSS)

Other comprehensive income (loss) components and related taxes are shown in the following table for the years ended December 31, 2008, 2007 and 2006.

Year ended December 31	Before-Tax			Tax			Net-of-Tax
(Dollars in thousands)	Amount			Expense			Amount
2008:
Unrealized gains on available-for-sale securities	$	48,324		$	16,913		$	31,411
Reclassification adjustment for gains realized in net income		(1,115	)		(390	)		(725	)
Unrealized net holding loss on cash flow hedge		(1,937	)		(678	)		(1,259	)
Changes in pension plan assets and benefit obligations recognized in Other Comprehensive Income		(24,958	)		(8,735	)		(16,223	)
Other comprehensive income	$	20,314		$	7,110		$	13,204
2007:
Unrealized gains on available-for-sale securities	$	26,071		$	9,125		$	16,946
Changes in pension plan assets and benefit obligations recognized in Other Comprehensive Income		5,025			1,759			3,266
Other comprehensive income	$	31,096		$	10,884		$	20,212
2006:
Unrealized losses on available-for-sale securities	$	(8,905	)	$	(3,117	)	$	(5,788	)
Reclassification adjustment for gains realized in net income		(97	)		(34	)		(63	)
Other comprehensive loss	$	(9,002	)	$	(3,151	)	$	(5,851	)

The ending balance of each component of accumulated other comprehensive income (loss) is as follows:

(Dollars in thousands)	2008			2007
Application of SFAS No. 158	$	(19,783	)	$	(3,560	)
Unrealized net holding loss on cash flow hedge		(1,259	)		—
Unrealized net holding gains on A-F-S Securities		31,638			952
Total accumulated other comprehensive income (loss)	$	10,596		$	(2,608	)

16. EARNINGS PER SHARE

SFAS No. 128, “Earnings Per Share” requires the reporting of basic and diluted earnings per share. Basic earnings per common share excludes any dilutive effects of options, warrants and convertible securities. Diluted earnings per common share is very similar to the previously reported fully diluted earnings per common share.

The following table sets forth the computation of basic and diluted earnings per share:

Year ended December 31
(Dollars in thousands, except per share data)	2008		2007		2006
Numerator:
Net income available to common shareholders	$	13,566	$	22,707	$	94,091
Denominator:
Basic earnings per common share:
Weighted-average shares		13,965,219		14,212,805		13,929,090
Effect of dilutive securities — stock options and warrant		114		4,678		37,746
Diluted earnings per common share:
Adjusted weighted-average shares and assumed conversions		13,965,333		14,217,483		13,966,836
Earnings per common share:
Basic earnings per common share	$	0.97	$	1.60	$	6.75
Diluted earnings per common share	$	0.97	$	1.60	$	6.74

Stock options for 505,749 and 491,262 shares of common stock were not considered in computing diluted earnings per common share for 2008 and 2007, respectively, because they were anti-dilutive. The dilutive effect of the warrant pertaining to the Capital Purchase Program was 114 shares of common stock at December 31, 2008.

17. DIVIDEND RESTRICTIONS

Bank regulators limit the amount of dividends a subsidiary bank can declare in any calendar year without obtaining prior approval. At December 31, 2008, approximately $19.9 million of the total stockholders’ equity of the bank subsidiaries is available for the payment of dividends to the Corporation, without approval by the applicable regulatory authorities.

18. FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND FINANCIAL INSTRUMENTS WITH CONCENTRATIONS OF CREDIT RISK

The Corporation is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include loan commitments and standby letters of credit. The instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the financial statements.

The Corporation’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for loan commitments and standby letters of credit is represented by the contractual amount of those instruments. The Corporation uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. Since many of the loan commitments may expire without being drawn upon, the total commitment amount does not necessarily represent future cash requirements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan commitments to customers.

The total amounts of off-balance sheet financial instruments with credit risk are as follows:

December 31 (Dollars in thousands)	2008		2007
Loan commitments	$	1,143,280	$	995,775
Unused credit card limits		—		132,242
Standby letters of credit		25,353		30,009

The loan commitments are generally for variable rates of interest.

The Corporation grants retail, commercial and commercial real estate loans to customers primarily located in Ohio, Baldwin County, Alabama and the panhandle of Florida. The Corporation evaluates each customer’s credit -worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Corporation upon extension of credit, is based on management’s credit evaluation of the customer. Collateral held varies but may include accounts receivable, inventory, property, plant and equipment, and income-producing commercial properties.

Although the Corporation has a diversified loan portfolio, a substantial portion of the borrowers’ ability to honor their contracts is dependent upon the economic conditions in each borrower’s geographic location and industry.

19. DERIVATIVE INSTRUMENTS

SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities” (“SFAS No. 133”), as amended and interpreted, establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. As required by SFAS No. 133, the Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and the resulting designation. Derivatives used to hedge the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives used to hedge the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges.

66

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivative is initially reported in other comprehensive income (outside of earnings) and subsequently reclassified into earnings when the hedged transaction affects earnings, and the ineffective portion of changes in the fair value of the derivative is recognized directly in earnings. The Company assesses the effectiveness of each hedging relationship by comparing the changes in cash flows of the derivative hedging instrument with the changes in cash flows of the designated hedged item or transaction.

During the first quarter of 2008, the Company executed an interest rate swap to hedge a $25 million floating-rate subordinated note that was entered into by Park during the fourth quarter of 2007. The Company’s objective in using this derivative was to add stability to interest expense and to manage its exposure to interest rate risk. Our interest rate swap involves the receipt of variable-rate amounts in exchange for fixed-rate payments over the life of the agreement without exchange of the underlying principal amount, and has been designated as a cash flow hedge.

As of December 31, 2008, no derivatives were designated as fair value hedges or hedges of net investments in foreign operations. Additionally, the Company does not use derivatives for trading or speculative purposes and currently does not have any derivatives that are not designated as hedges. At December 31, 2008, the derivative’s fair value of $(1,937,000) was included in other liabilities. No hedge ineffectiveness on the cash flow hedge was recognized during the twelve months ended December 31, 2008. At December 31, 2008, the variable rate on the $25 million subordinated note was 3.43% (LIBOR plus 200 basis points) and Park was paying 6.01% (4.01% fixed rate on the interest rate swap plus 200 basis points).

For the twelve months ended December 31, 2008, the change in the fair value of the derivative designated as a cash flow hedge reported in other comprehensive income was $(1,259,000) (net of taxes of $(678,000)). Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt.

20. LOAN SERVICING

Park serviced sold mortgage loans of $1,369 million at December 31, 2008 compared to $1,403 million at December 31, 2007, and $1,405 million at December 31, 2006. At December 31, 2008, $65 million of the sold mortgage loans were sold with recourse compared to $70 million at December 31, 2007. Management closely monitors the delinquency rates on the mortgage loans sold with recourse. At December 31, 2008, management determined that no liability was deemed necessary for these loans.

Park capitalized $1.5 million in mortgage servicing rights in 2008 and $1.6 million in both 2007 and 2006. Park’s amortization of mortgage servicing rights was $1.7 million, in both 2008 and 2007 and $1.9 million in 2006. The amortization of mortgage loan servicing rights is included within “Other Service Income”. Generally, mortgage servicing rights are capitalized and amortized on an individual sold loan basis. When a sold mortgage loan is paid off, the related mortgage servicing rights are fully amortized.

Activity for mortgage servicing rights and the related valuation allowance follows:

December 31 (Dollars in thousands)	2008			2007
Servicing rights:
Beginning of year	$	10,204		$	10,371
Additions		1,481			1,573
Amortized to expense		(1,734	)		(1,740	)
Change in valuation expense		(1,645	)		—
End of year	$	8,306		$	10,204
Valuation allowance:
Beginning of year	$	—		$	—
Additions expensed		1,645			—
End of year	$	1,645		$	—

21. FAIR VALUES

SFAS No. 157 establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. SFAS No. 157 describes three levels of inputs that Park uses to measure fair value:

• Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

• Level 2: Level 1 inputs for assets or liabilities that are not actively traded. Also consists of an observable market price for a similar asset or liability. This includes the use of “matrix pricing” used to value debt securities absent the exclusive use of quoted prices.

• Level 3: Consists of unobservable inputs that are used to measure fair value when observable market inputs are not available. This could include the use of internally developed models, financial forecasting, etc.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability between market participants at the balance sheet date. When possible, the Company looks to active and observable markets to price identical assets or liabilities. When identical assets and liabilities are not traded in active markets, the Company looks to observable market data for similar assets and liabilities. However, certain assets and liabilities are not traded in observable markets and Park must use other valuation methods to develop a fair value. The fair value of impaired loans is based on the fair value of the underlying collateral, which is estimated through third party appraisals or internal estimates of collateral values.

Assets and Liabilities Measured on a Recurring Basis:

The following table presents financial assets and liabilities measured on a recurring basis:

Fair Value Measurements at Reporting Date Using:

				Quoted Prices in		Significant			Significant
				Active Markets for		Observable			Unobservable
				Identical Assets		Inputs			Inputs
(In thousands)	12/31/08			(Level 1)		(Level 2)			(Level 3)
Available-for-Sale Securities	$	1,561,896		$	1,783	$	1,557,408		$	2,705
Interest rate swap		(1,937	)		—		(1,937	)		—
Total	$	1,559,959		$	1,783	$	1,555,471		$	2,705

The table below is a reconciliation of the beginning and ending balances of the Level 3 inputs:

Fair Value Measurements at Reporting Date Using Significant Unobservable Inputs (Level 3)

(In thousands)	AFS Securities
Beginning Balance at January 1, 2008	$	2,969
Maturities of investments		(120	)
Total unrealized (losses) included in Other Comprehensive Income		(144	)
Ending Balance	$	2,705

Assets and Liabilities Measured on a Nonrecurring Basis:

The following table presents financial assets and liabilities measured on a nonrecurring basis:

Fair Value Measurements at Reporting Date Using:

			Quoted Prices in		Significant		Significant
			Active Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
(In thousands)	12/31/08		(Level 1)		(Level 2)		(Level 3)
SFAS No. 114 impaired loans	$	75,942	$	—	$	—	$	75,942
Mortgage servicing rights		8,306		—		8,306		—

67

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Commercial nonaccrual and restructured (impaired) loans, which are usually measured for impairment using the fair value of the collateral (less estimated cost to sell), had a carrying amount of $141.3 million. Of these, $75.9 million were carried at fair value, as a result of partial charge-offs of $30.0 million and a specific valuation allowance of $8.7 million. The specific valuation allowance for those loans has increased from $4.5 million at September 30, 2008 to $8.7 million at December 31, 2008.

Servicing rights, which are carried at lower of cost or fair value, were written down to fair value of $8.3 million, resulting in a valuation allowance of $1.6 million. A charge of $1.6 million was included in earnings for the year ended December 31, 2008.

The following methods and assumptions were used by the Corporation in estimating its fair value disclosures for financial instruments:

Cash and cash equivalents: The carrying amounts reported in the balance sheet for cash and short-term instruments approximate those assets’ fair values.

Interest bearing deposits with other banks: The carrying amounts reported in the balance sheet for interest bearing deposits with other banks approximate those assets’ fair values.

Investment securities: Fair values for investment securities are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. The table below excludes Park’s Federal Home Loan Bank stock and Federal Reserve Bank stock, as it is not practicable to calculate their fair values.

Loans receivable: For variable-rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values. The fair values for certain mortgage loans (e.g., one-to-four family residential) are based on quoted market prices of similar loans sold in conjunction with securitization transactions, adjusted for differences in loan characteristics. The fair values for other loans are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. Loans carried on the balance sheet at their fair value are broken out separately for 2008, the year of adoption of SFAS No. 157. SFAS No. 157 was adopted prospectively on January 1, 2008.

Off-balance sheet instruments: Fair values for the Corporation’s loan commitments and standby letters of credit are based on the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. The carrying amount and fair value are not material.

Deposit liabilities: The fair values disclosed for demand deposits (e.g., interest and non-interest checking, savings, and money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amounts). The carrying amounts for variable-rate, fixed-term certificates of deposit approximate their fair values at the reporting date. Fair values for fixed rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities of time deposits. Maturities of time deposits in denominations of $100,000 and over at December 31, 2008, maturing in 12 months or less, were $657.3 million and those maturing after 12 months were $149.8 million.

Short-term borrowings: The carrying amounts of federal funds purchased, borrowings under repurchase agreements and other short-term borrowings approximate their fair values.

Long-term debt: Fair values for long-term debt are estimated using a discounted cash flow calculation that applies interest rates currently being offered on long-term debt to a schedule of monthly maturities.

Subordinated debt: The carrying amounts reported in the balance sheet approximate fair value. The interest rates on these instruments reprice every 90 days based on the three-month LIBOR rate.

Interest rate swaps: The fair value of interest rate swaps represent the estimated amount Park would pay or receive to terminate the agreements, considering current interest rates and the current creditworthiness of the counterparties.

The fair value of financial instruments at December 31, 2008 and 2007, is as follows. Items that are not financial instruments are not included.

	2008						2007
December 31,	Carrying			Fair			Carrying		Fair
(In thousands)	Amount			Value			Amount		Value
Financial assets:
Cash and money market instruments	$	171,261		$	171,261		$	193,397	$	193,397
Interest bearing deposits with other banks		1			1			1		1
Investment securities		2,059,051			2,064,136			1,703,103		1,699,096
Loans carried at fair value		75,942			75,942			N/A		N/A
Other loans		4,311,484			4,430,697			4,130,232		4,217,169
Loans receivable, net	$	4,387,426		$	4,506,639		$	4,130,232	$	4,217,169
Financial liabilities:
Noninterest bearing checking	$	782,625		$	782,625		$	695,466	$	695,466
Interest bearing transaction accounts		1,204,530			1,204,530			1,338,492		1,338,492
Savings		694,721			694,721			531,049		531,049
Time deposits		2,078,372			2,084,732			1,872,440		1,873,114
Other		1,502			1,502			1,792		1,792
Total deposits	$	4,761,750		$	4,768,110		$	4,439,239	$	4,439,913
Short-term borrowings		659,196			659,196			759,318		759,318
Long-term debt		855,558			939,210			590,409		605,866
Subordinated debentures		40,000			40,000			40,000		40,000
Derivative financial instruments:
Interest rate swap		(1,937	)		(1,937	)		—		—

22. CAPITAL RATIOS

At December 31, 2008 and 2007, the Corporation and each of its two separately chartered banks had Tier 1, total risk-based capital and leverage ratios which were well above both the required minimum levels of 4.00%, 8.00% and 4.00%, respectively, and the well-capitalized levels of 6.00%, 10.00% and 5.00%, respectively.

The following table indicates the capital ratios for Park and each subsidiary at December 31, 2008 and December 31, 2007.

	2008										2007
	Tier 1			Total						Tier 1			Total
	Risk-			Risk-						Risk-			Risk-
December 31	Based			Based			Leverage			Based			Based			Leverage
Park National Bank		8.63	%		10.89	%		5.94	%		7.92	%		10.78	%		5.66	%
Vision Bank		11.60	%		12.86	%		9.74	%		9.01	%		10.28	%		7.08	%
Park		11.69	%		13.47	%		8.36	%		10.16	%		11.97	%		7.10	%

Failure to meet the minimum requirements above could cause the Federal Reserve Board to take action. Park’s bank subsidiaries are also subject to these capital requirements by their primary regulators. As of December 31, 2008 and 2007, Park and its banking subsidiaries were well-capitalized and met all capital requirements to which each was subject. There are no conditions or events since the most recent regulatory report filings, by PNB or Vision Bank (“VB”), that management believes have changed the risk categories for either of the two banks.

68

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table reflects various measures of capital for Park and each of PNB and Vision:

						To Be Adequately Capitalized					To Be Well Capitalized
(In thousands)	Actual Amount		Ratio			Amount		Ratio			Amount		Ratio
At December 31, 2008:
Total Risk-Based Capital (to risk-weighted assets)
PNB	$	442,247		10.89	%	$	324,818		8.00	%	$	406,022		10.00	%
VB		94,670		12.86	%		58,897		8.00	%		73,622		10.00	%
Park		646,132		13.47	%		383,650		8.00	%		479,562		10.00	%
Tier 1 Risk-Based Capital (to risk-weighted assets)
PNB	$	350,344		8.63	%	$	162,409		4.00	%	$	243,613		6.00	%
VB		85,397		11.60	%		29,449		4.00	%		44,173		6.00	%
Park		560,691		11.69	%		191,825		4.00	%		287,737		6.00	%
Leverage Ratio (to average total assets)
PNB	$	350,344		5.94	%	$	235,878		4.00	%	$	294,848		5.00	%
VB		85,397		9.74	%		35,057		4.00	%		43,821		5.00	%
Park		560,691		8.36	%		268,244		4.00	%		335,304		5.00	%
At December 31, 2007:
Total Risk-Based Capital (to risk-weighted assets)
PNB	$	167,362		10.78	%	$	124,158		8.00	%	$	155,197		10.00	%
VB		67,938		10.28	%		52,855		8.00	%		66,068		10.00	%
Park		533,041		11.97	%		356,130		8.00	%		445,163		10.00	%
Tier 1 Risk-Based Capital (to risk-weighted assets)
PNB	$	122,865		7.92	%	$	62,079		4.00	%	$	93,118		6.00	%
VB		59,533		9.01	%		26,427		4.00	%		39,641		6.00	%
Park		452,073		10.16	%		178,065		4.00	%		267,098		6.00	%
Leverage Ratio (to average total assets)
PNB	$	122,865		5.66	%	$	86,790		4.00	%	$	108,488		5.00	%
VB		59,533		7.08	%		33,613		4.00	%		42,016		5.00	%
Park		432,073		7.10	%		254,854		4.00	%		318,568		5.00	%

23. SEGMENT INFORMATION

The Corporation is a multi-bank holding company headquartered in Newark, Ohio. The operating segments for the Corporation are its two chartered bank subsidiaries, The Park National Bank (headquartered in Newark, Ohio) and Vision Bank (headquartered in Panama City, Florida) (“VIS”). Guardian Finance Company (“GFC”) is a consumer finance company and is excluded from PNB for segment reporting purposes. GFC is included within the presentation of “All Other” in the segment reporting tables that follow. During the third quarter of 2008, Park combined the eight separately chartered Ohio-based bank subsidiaries into one national bank charter, that of The Park National Bank (“PNB”). Prior to the charter mergers that were consummated in the third quarter of 2008, Park considered each of its nine chartered bank subsidiaries as a separate segment for financial reporting purposes. SFAS No. 131 “Disclosures about Segments of an Enterprise and Related Information (as amended)” requires management to disclose information about the different types of business activities in which a company engages and also information on the different economic environments in which a company operates, so that the users of the financial statements can better understand a company’s performance, better understand the potential for future cash flows, and make more informed judgments about the company as a whole. The change to two operating segments is in line with SFAS No. 131 as there are: (i) two separate and distinct geographic markets in which Park operates, (ii) the key operational functions of the two segments are primarily kept separate and distinct and (iii) the segments are aligned with the internal reporting to Park’s senior management. The financial information for the two fiscal years ended December 31, 2007 and December 31, 2006 has been reclassified to be consistent with the presentation of the financial information for the twelve months ended December 31, 2008.

69

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Operating Results for the year ended December 31, 2008 (In thousands)

	PNB		VB			All Other			Total
Net interest income	$	219,843	$	27,065		$	8,965		$	255,873
Provision for loan losses		21,512		46,963			2,012			70,487
Other income		81,310		3,014			510			84,834
Depreciation and amortization		6,128		1,360			29			7,517
Goodwill impairment charge		—		54,986			—			54,986
Other expense		131,167		25,789			15,042			171,998
Income (loss) before taxes		142,346		(99,019	)		(7,608	)		35,719
Income taxes (benefit)		47,081		(17,832	)		(7,238	)		22,011
Net income (loss)	$	95,265	$	(81,187	)	$	(370	)	$	13,708
Balances at December 31, 2008:
Assets	$	6,243,365	$	917,041		$	(89,686	)	$	7,070,720
Loans		3,790,867		690,472			9,998			4,491,337
Deposits		4,210,439		636,635			(85,324	)		4,761,750

Operating Results for the year ended December 31, 2007 (In thousands)

	PNB		VB			All Other			Total
Net interest income	$	201,555	$	23,756		$	9,366		$	234,677
Provision for loan losses		7,966		19,425			2,085			29,476
Other income		67,482		3,465			693			71,640
Depreciation and amortization		5,392		1,024			64			6,480
Goodwill impairment charge		—		54,035			—			54,035
Other expense		131,907		17,521			14,221			163,649
Income (loss) before taxes		123,772		(64,784	)		(6,311	)		52,677
Income taxes (benefit)		40,692		(4,103	)		(6,619	)		29,970
Net income (loss)	$	83,080	$	(60,681	)	$	308		$	22,707
Balances at December 31, 2007:
Assets	$	5,655,022	$	855,794		$	(9,714	)	$	6,501,102
Loans		3,574,894		639,097			10,143			4,224,134
Deposits		3,820,917		656,768			(38,446	)		4,439,239

Operating Results for the year ended December 31, 2006 (In thousands)

	PNB		VB		All Other			Total
Net interest income	$	200,758	$	—	$	12,486		$	213,244
Provision for loan losses		3,128		—		799			3,927
Other income		64,111		—		651			64,762
Depreciation and amortization		5,322		—		200			5,522
Other expense		125,080		—		10,400			135,480
Income before taxes		131,339		—		1,738			133,077
Income taxes (benefit)		43,111		—		(4,125	)		38,986
Net income	$	88,228	$	—	$	5,863		$	94,091
Balances at December 31, 2006:
Assets	$	5,830,304	$	—	$	(359,428	)	$	5,470,876
Loans		3,471,158		—		9,544			3,480,702
Deposits		3,878,024		—		(52,490	)		3,825,534

Reconciliation of financial information for the reportable segments to the Corporation’s consolidated totals:

	Net Interest		Depreciation		Other		Income
(In thousands)	Income		Expense		Expense		Taxes			Assets			Deposits
2008:
Totals for reportable segments	$	246,908	$	7,488	$	211,942	$	29,249		$	7,160,406		$	4,847,074
Elimination of intersegment items		—		—		—		—			(186,809	)		(85,324	)
Parent Co. and GFC totals — not eliminated		8,965		29		15,042		(7,238	)		97,123			—
Other items		—		—		—		—			—			—
Totals	$	255,873	$	7,517	$	226,984	$	22,011		$	7,070,720		$	4,761,750

	Net Interest		Depreciation		Other		Income
(In thousands)	Income		Expense		Expense		Taxes			Assets			Deposits
2007:
Totals for reportable segments	$	225,311	$	6,416	$	203,463	$	36,589		$	6,510,816		$	4,477,685
Elimination of intersegment items		—		—		—		—			(108,602	)		(38,446	)
Parent Co. and GFC totals — not eliminated		9,366		39		14,221		(6,619	)		98,888			—
Other items		—		25		—		—			—			—
Totals	$	234,677	$	6,480	$	217,684	$	29,970		$	6,501,102		$	4,439,239
2006:
Totals for reportable segments	$	200,758	$	5,322	$	125,080	$	43,111		$	5,830,304		$	3,878,024
Elimination of intersegment items		—		—		—		—			(450,425	)		(52,490	)
Parent Co. and GFC totals — not eliminated		12,486		49		10,400		(4,125	)		90,997			—
Other items		—		151		—		—			—			—
Totals	$	213,244	$	5,522	$	135,480	$	38,986		$	5,470,876		$	3,825,534

24. PARENT COMPANY STATEMENTS

The Parent Company statements should be read in conjunction with the consolidated financial statements and the information set forth below.

Investments in subsidiaries are accounted for using the equity method of accounting.

The effective tax rate for the Parent Company is substantially less than the statutory rate due principally to tax-exempt dividends from subsidiaries.

Cash represents noninterest bearing deposits with a bank subsidiary.

Net cash provided by operating activities reflects cash payments (received from subsidiaries) for income taxes of $8.230 million, $6.670 million and $5.345 million in 2008, 2007 and 2006, respectively.

At December 31, 2008 and 2007, stockholders’ equity reflected in the Parent Company balance sheet includes $126.2 million and $127.3 million, respectively, of undistributed earnings of the Corporation’s subsidiaries which are restricted from transfer as dividends to the Corporation.

Balance Sheets
at December 31, 2008 and 2007

(In thousands)	2008		2007
Assets:
Cash	$	80,343	$	22,541
Investment in subsidiaries		547,308		547,171
Debentures receivable from subsidiary banks		7,500		7,500
Other investments		1,064		1,395
Other assets		58,054		62,675
Total assets	$	694,269	$	641,282
Liabilities:
Dividends payable	$	123	$	13,173
Subordinated debentures		15,000		15,000
Other liabilities		36,483		33,097
Total liabilities		51,606		61,270
Total stockholders’ equity		642,663		580,012
Total liabilities and stockholders’ equity	$	694,269	$	641,282

70

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Statements of Income
for the years ended December 31, 2008, 2007 and 2006

(In thousands)	2008			2007			2006
Income:
Dividends from subsidiaries	$	93,850		$	65,564		$	89,500
Interest and dividends		3,639			3,828			7,107
Other		575			673			632
Total income		98,064			70,065			97,239
Expense:
Other, net		14,158			12,032			8,307
Total expense		14,158			12,032			8,307
Income before federal taxes and equity in undistributed earnings of subsidiaries		83,906			58,033			88,932
Federal income tax benefit		8,057			7,055			4,985
Income before equity in undistributed earnings of subsidiaries		91,963			65,088			93,917
Equity in undistributed (losses) earnings of subsidiaries		(78,255	)		(42,381	)		174
Net income	$	13,708		$	22,707		$	94,091

Statements of Cash Flows
for the years ended December 31, 2008, 2007 and 2006

(In thousands)	2008			2007			2006
Operating activities:
Net income	$	13,708		$	22,707		$	94,091
Adjustments to reconcile net income to net cash provided by operating activities:
Undistributed losses (earnings) of subsidiaries		78,255			42,381			(174	)
Other than temporary impairment charge, investments		774			—			—
Realized net investment security (gains)		—			—			(97	)
(Gain) on sale of assets		—			(18	)		—
Decrease in dividends receivable from subsidiaries		—			—			75,075
Stock based compensation expense		—			893			—
Decrease (increase) in other assets		4,508			(6,227	)		(4,090	)
Increase in other liabilities		2,042			1,774			1,378
Net cash provided by operating activities		99,287			61,510			166,183
Investing activities:
Cash paid for acquisition, net		—			(85,600	)		(9,052	)
Purchase (sales) of investment securities		(158	)		(400	)		403
Capital contribution to subsidiary		(76,000	)		(6,700	)		(2,000	)
Cash received for sale of premises		—			48			—
Repayment of debentures receivable from subsidiaries		—			20,000			28,500
Net cash (used in) provided by investing activities		(76,158	)		(72,652	)		17,851
Financing activities:
Cash dividends paid		(65,781	)		(52,533	)		(51,470	)
Proceeds from issuance of common stock and warrant		4,736			—			42
Cash payment for fractional shares		(3	)		(5	)		(5	)
Proceeds from issuance of preferred stock		95,721			—			—
Purchase of treasury stock, net		—			(64,733	)		(26,690	)
Net cash provided by (used in) financing activities		34,673			(117,271	)		(78,123	)
Increase (decrease) in cash		57,802			(128,413	)		105,911
Cash at beginning of year		22,541			150,954			45,043
Cash at end of year	$	80,343		$	22,541		$	150,954

25. PARTICIPATION IN THE U.S. TREASURY CAPITAL PURCHASE PROGRAM

On October 3, 2008, Congress passed the Emergency Economic Stabilization Act of 2008 (EESA), which creates the Troubled Asset Relief Program (“TARP”) and provides the U.S. Secretary of the Treasury with broad authority to implement certain actions to help restore stability and liquidity to U.S. markets. The Capital Purchase Program (the “CPP”) was announced by the U.S. Treasury on October 14, 2008 as part of TARP. Pursuant to the CPP, the U.S. Treasury will purchase up to $250 billion of senior preferred shares on standardized terms from qualifying financial institutions. The purpose of the CPP is to encourage U.S. financial institutions to build capital to increase the flow of financing to U.S. businesses and consumers and to support the U.S. economy.

The CPP is voluntary and requires a participating institution to comply with a number of restrictions and provisions, including standards for executive compensation and corporate governance and limitations on share repurchases and the declaration and payment of dividends on common shares. The standard terms of the CPP require that a participating financial institution limit the payment of dividends to the most recent quarterly amount prior to October 14, 2008, which is $0.94 per share in the case of Park. This dividend limitation will remain in effect until such time that the preferred shares are no longer outstanding.

Eligible financial institutions could generally apply to issue senior preferred shares to the U.S. Treasury in aggregate amounts between 1% to 3% of the institution’s risk-weighted assets. In the case of Park, an application for an investment by the U.S. Treasury of $100 million was made. Park’s application was approved by the U.S. Treasury on December 1, 2008 and on December 23, 2008, Park issued $100 million of cumulative perpetual preferred shares, with a liquidation preference of $1,000 per share (the “Senior Preferred Shares”). The Senior Preferred Shares constitute Tier 1 capital and rank senior to Park’s common shares. The Senior Preferred Shares pay cumulative dividends at a rate of 5% per annum for the first five years and will reset to a rate of 9% per annum after five years.

As part of its participation in the CPP, Park also issued a warrant to the U.S. Treasury to purchase 227,376 common shares having an exercise price of $65.97, which is equal to 15% of the aggregate amount of the Senior Preferred Shares purchased by the U.S. Treasury. The initial exercise price for the warrant and the market price for determining the number of common shares subject to the warrant was determined by reference to the market price of the common shares on the date of the investment by the U.S. Treasury in the Senior Preferred Shares (calculated on a 20-day trailing average). The warrant has a term of 10 years.

71

EX-14

Exhibit 14

CODE OF BUSINESS CONDUCT AND ETHICS
Adopted by the Board of Directors
Park National Corporation
January 16, 2001
Amended
April 15, 2002
July 21, 2003
April 19, 2004
July 18, 2005
July 17, 2006
July 16, 2007
(updated 7/24/07)
April 21, 2008
(updated 4/23/08)
July 21, 2008
(updated 7/25/08)
January 26, 2009
(updated 1/30/09)

CODE OF BUSINESS CONDUCT AND ETHICS

Park National Corporation (“Park”) is judged by the collective and individual performance of the directors, officers, associates, and agents of Park and its affiliates (collectively, the “Company”). Thus, these individuals traditionally have recognized that their first duty to the Company and its several publics is to act in a manner that merits public trust and confidence.

As professionals, the Company’s directors, officers, associates, and agents have earned a reputation for integrity and competence. They have been guided and judged by the highest standards of conduct. Over the years, these standards have been reaffirmed, despite new challenges and ever-changing social values. Integrity, honesty, public trust and confidence have served as crucial tests of our service and success.

This Code of Business Conduct and Ethics (the “Code of Ethics”) has been adopted by the Board of Directors of Park to demonstrate to the public and the Company’s various constituents the importance that Park’s Board of Directors and leadership place on ethical conduct. The Code of Ethics is intended to set forth the Company’s expectations for the conduct of ethical business practices by its directors, officers, associates, and agents to promote advanced disclosure and review of potential conflicts of interest and similar matters, to protect and encourage the reporting of questionable behavior, to foster an atmosphere of self-awareness and prudent conduct and to discipline appropriately those who engage in improper conduct. The Code of Ethics is not presented to expand upon or change the ethical standards of our directors, officers, associates, and agents. It is not intended to be all-inclusive, and cannot address every situation that might arise. Rather its purpose is to reduce to writing many of the patterns of conduct that are expected at Park or any of its affiliates. It represents a set of minimum standards. It is important to remember that our good reputation emerges from many actions and can be jeopardized by one.

You are required to read this Code of Ethics carefully. Should it be unclear, please seek guidance from your affiliate president or the Chief Executive Officer, Chairman of the Board, President or the Internal Auditor of Park, for in matters such as these, appearance is often as important as reality. It is not only the letter but the spirit of the commitment that is important.

On an annual basis, directors and officers of Park and each affiliate must re-read this Code of Ethics and provide written verification of such review by signing an appropriate acknowledgment form. New associates must read the Code of Ethics and sign the appropriate acknowledgment form during their orientation meeting. All associates must re-read the Code of Ethics (as amended) and sign new acknowledgment forms after any amendments are approved by the Board of Directors of Park.

Conflicts of Interest

As directors, officers, associates, and agents of a financial services organization, we assume a duty to our communities, our customers and our shareholders. Such duty is to act in all matters in a manner that will merit

1

public trust and confidence. This duty extends to all activities — both personal and professional. Each person associated with the Company is expected to direct his or her personal conduct in a manner which will bring credit to the Company and to avoid any action which would discredit it.

In the exercise of privileges and authority arising from employment or other association with the Company, two fundamental principles apply: directors, officers, associates, and agents, when acting for, on behalf of, or in the name of the Company, will place the interest of the Company ahead of their own private interests, and directors, officers, associates, and agents have a duty to make full disclosure of any situation in which their private interests create a conflict or potential conflict with those of the Company.

Conflicts of interest occur when business judgments or decisions may be influenced by personal interests not shared by the organization as a whole. A conflict situation may, for example, arise when an individual, or a member of the individual’s family, has an interest in a transaction to which the Company is a party, competes with the Company or takes advantage of an opportunity that belongs to the Company.

When a conflict of interest arises, an officer, director, associate, or agent has a duty to place the Company’s interests above his or her own personal interests. It is essential that in those instances where a Company decision or practice may appear to have been made to advance a personal interest, that the decision be made or approved by the independent and “disinterested” officers or directors of the Company. Thus, in those instances where an associate faces a potential conflict of interest, the associate should report the potential conflict of interest to a senior officer for his or her review. Any action or transaction in which the personal interest of an officer, director, or agent of the Company may be in conflict with those of the Company must be promptly reported to the chairperson of the Audit Committee of the Board of Directors of Park (the “Audit Committee”). The Audit Committee shall review and oversee all actions and transactions which involve the personal interest of an associate, officer, or director and shall have the right to determine in advance that any such action or transaction does not constitute a conflict of interest in violation of this Code of Ethics.

It is considered a conflict of interest, and therefore could result in termination of employment, if an associate of one of the affiliates of Park makes a loan, processes any type of transaction (e.g., withdrawals, deposits, check cashing or payments), or waives fees and/or service charges for his/her own personal loans, accounts, or transactions or those of immediate family members or persons living in the same household (roommate, boyfriend, girlfriend, etc.). It is each associate’s responsibility to exercise prudence and good judgment when making loans or processing transactions to or for anyone whose personal relationship with the associate may influence his/her judgment.

This policy is not meant to discourage relatives and/or friends of associates from banking with any of our affiliates. They should be afforded the same fine service as other customers.

Trusts

It is improper for an associate to accept appointment of or continue to act as a fiduciary or co-fiduciary in the case of any trust, estate, agency, guardianship or custodianship of a client of Park, unless, the creator of the relationship, or the ward in the case of a guardianship, is or was at the time of death, a member of the employee’s immediate family. An associate shall not serve as a personal representative of an estate; act as a trustee of a trust, or guardian of the minor heir unless the client is a close relative or personal friend of the associate.

No associate shall accept appointment as a fiduciary or co-fiduciary in any trust, estate, agency, guardianship or conservatorship of an estate or custodianship, or act as an investment counselor or estate appraiser for a client of the Company (other than in the course of employment with the Company), unless, the creator of the relationship, or the ward in the case of a guardianship or conservatorship, is in the immediate family of the associate or a close personal friend. The provision can be waived, on a case-by-case basis, by written approval of the Chief Executive Officer of the appropriate affiliate of Park.

2

Associates must report to the Company any legacy or bequest to them under wills or trusts of clients (other than immediate family or relatives). The Audit Committee or Board of Directors will evaluate such reports to assure than a conflict of interest does not exist. If a conflict does exist, the beneficiary associate may be expected to be relieved of the administration of the legacy and may be required to renounce the gift. Noncompliance with a Company directive on such a matter may be grounds for discipline or termination.

Outside Activities

No outside activity must interfere or conflict with the interest of any of Park or its affiliates. Acceptance of outside employment, election to directorships of other for-profit corporations, representation of customers in their dealings with our affiliates and participation in the affairs of all outside organizations carry possibilities of conflict of interest. No associate may serve as an official or director of any for-profit enterprise without obtaining written approval from the appropriate affiliate’s Chief Executive Officer.

Associates of the Company should ask themselves the following questions when considering a job outside the Company: Is there a conflict of interest? Will it adversely affect my affiliate? Will the job interfere with the time and attention that must be devoted to the job duties, responsibilities, or other obligations at the affiliate? Will Company property or equipment or use of proprietary information (such as mailing lists, computer systems, etc.) be involved? If the answer to any of these questions is “yes,” the second job should not be accepted.

Service with constructive non-profit organizations and participation in civic affairs is strongly encouraged. There are cases, however, when organizations having business relationships with one of our affiliates in which the handling of confidential information is involved might result in a conflict of interest. Associates must be sensitive to such potential conflicts.

Gifts, Fees, Gratuities, and Other Payments from Customers or Suppliers

Some of our business acquaintances customarily distribute small gifts at Christmas and on other occasions. In the event of receipt of such gift or entertainment opportunity, each director, officer, associate, and agent (when acting for, on behalf of or in the name of the Company) must decide conscientiously whether or not acceptance would give rise to a feeling of obligation, or could lead to misinterpretation. Gifts, benefits, or unusual hospitality that might tend to influence one in the performance of his or her duty must not be accepted. Such gifts, benefits or unusual hospitality do not include gifts of nominal value, or gifts which serve as general advertising for the donor, or discounts or special concessions available to all associates, or hospitality which is casual and limited to a normal situation. As a further guide to what may or may not be acceptable, you should ask yourself whether, in the judgment of business associates or disinterested parties, such acceptance might seem to impair your ability to act at all times solely in the best interests of your affiliate.

Officers, directors, associates and agents of the Company are prohibited from (1)soliciting for themselves or for a third party (other than the respective affiliate of Park with which they are associated) anything of value from anyone in return for any business, service or confidential information of the affiliate of Park with which they are associated, and (2) accepting anything of value (other than a bona fide salary, wages and fees referred to in 18 U.S.C. 215c) from anyone in connection with the business of the respective affiliate of Park with which they are associated, either before or after a transaction is discussed or consummated.

Additional direction on this subject is provided in the “Insider Activities” section of the Comptroller’s Handbook (Comptroller of the Currency, March 1995) which also addresses Title 18 U.S.C. 215 “Crime Control Act of 1984”.

This statute is intended to prevent a pay-off to officers, directors, associates or agents of an affiliate of Park as a quid pro quo either to induce a particular transaction or as a “gratuity” in support of a particular transaction. Thus, where a benefit is given or received as a result of a banking transaction, the statute may be violated. However, it is not intended to proscribe the receipt of gratuities or favors of nominal value when it is clear from

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the circumstances that (a) a customer is not trying to exert any influence over the officer, director, associate or agent of the affiliate of Park in connection with a transaction and (b) the gratuity or favor is, in fact, unsolicited.

If an officer, director, or agent receives a personal benefit that is not clearly reasonable and business-related, he/she must report it to the Audit Committee. If an associate receives a personal benefit that is not clearly reasonable and business-related, he/she must report it to the Chief Executive Officer of the appropriate affiliate. The Park Audit Committee or the affiliate Chief Executive Officer, as the case may be, shall have the right to determine in advance that any such personal benefit does not constitute a conflict of interest in violation of this Code of Ethics and/or to require that such personal benefit be returned to the provider and/or reimbursed by the Company.

Dealing Fairly With Customers, Suppliers, and Other Associates

No officer, director, associate, or agent of the Company should take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts or any other unfair dealing practice. The Company does not sanction offering or making payments of any kind, whether of money, services or property, to any domestic or foreign public official or of providing personal benefits that are not clearly reasonable and business-related to any employee, agent or representative of any organization seeking to or doing business with the Company. If there is any question as to whether any such personal benefit is clearly reasonable and business-related, an officer, director, or agent should seek pre-approval from the Audit Committee, and an associate from the Chief Executive Officer of the appropriate affiliate.

Competition

The Company believes that open and honest competition in the marketplace is healthy and must always be positive, not negative. Any collusion with competitors about the pricing of bank services, interest rates or otherwise engaging in any activity that has the effect, directly or indirectly, of lessening competition, is not permitted.

Associates should avoid portraying bank competitors, or the Company itself, in a negative or adverse way. Associates have a duty to portray the Company in the best possible light when communicating with clients, friends, neighbors and any current or potential clients.

If an associate chooses to identify himself or herself as a Company associate on a Web site or Web log, the associate must adhere to the following guidelines:

1.	Make it clear that the views expressed are the associate’s alone and that they do not necessarily reflect the views of the Company;
2.	Never disclose any information that is confidential or proprietary to the Company or any of its clients, or to any third party that has disclosed information to the Company.
3.	Uphold at all times the Company’s values and respect for individuals, and avoid making defamatory statements about Company associates, clients, partners, affiliates and others, including competitors.

If the blogging activity of any associate is seen as compromising the Company in any way, the Company may request a cessation of such commentary and the associate may be subject to disciplinary action.

Political Activities

Neither Park nor any of its affiliates will make any contribution or expenditure, either directly or indirectly, to, or for the benefit of, use of, in support of, or in opposition to, any political party, candidate, political committee, or for any non public issue purpose. The Company will not reimburse any person for such contribution or expenditure. This policy relates to the use of corporate and/or affiliate funds only, and in no way is intended to

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discourage officers, directors, associates, and/or agents from making personal contributions to individual candidates, political parties, or political action committees.

The Company may make political loans in connection with campaigns provided that such loans are made in accordance with applicable banking laws, in the ordinary course of business, and in conformity with state law.

Directors, officers, associates, and agents of the Company may engage in political activity (serving for example as a campaign treasurer). Associates should inform the persons to whom they report and be very careful not to allow their activity to interfere with their work-related responsibilities. This means such activity would ordinarily be confined to the evenings and weekends and only occasionally and exceptionally would it be engaged in during business hours.

Any associate of one of our affiliates who is considering becoming a candidate for any elective public office, engaging in outside employment under any governmental unit, or being appointed to any governmental position should inform the affiliate with which the associate is employed and obtain prior approval by the Chief Executive Officer of that affiliate.

Use of Bank Property

It is contrary to the Company’s Code of Ethics to permit the payment of funds of any affiliate of Park, or use of bank property, either directly or indirectly to secure favored business treatment for the Bank. In addition, bank property or funds cannot be used to support a campaign for public office. This includes the use of bank personnel and equipment such as telephones, copy machines, postage, etc.

Confidential Information

Perhaps the most crucial area of concern for bankers and regulatory authorities is the use and/or abuse of confidential information. Financial institutions by their very nature are privy to customers’ business plans, forecasts, decisions, and problems. Bankers receive this information as an aid to providing more efficient, more knowledgeable service ... and for no other reason.

The use of such information for one’s own, or another’s, personal benefit constitutes an abuse which subjects an individual and the institution to statutory penalties.

Banks also possess considerable information which, though not necessarily confidential by nature, must nonetheless be treated confidentially if the right of privacy of customers and staff is to be safeguarded.

Therefore, confidential information with respect to the Company’s customers and suppliers acquired by an officer, director, associate or agent of the Company, through his or her association with the Company, is considered to be privileged and must be held in the strictest confidence. It is to be used solely for corporate purposes and not as a basis for personal gain by the officer, director, associate or agent. In no case shall such information be transmitted to persons outside the Company, including family or other acquaintances, or even to other officers, directors, associates, or agents of the Company who do not need to know such information in discharging their duties as officers, directors, associates or agents. The restrictions in this paragraph shall also apply to the reports and statements prepared for use in the Company’s business and not generally released. The disclosure of material, non-public information to others can lead to significant legal difficulties, fines and punishment as well as termination of employment. Only specifically designated representatives of the Company may discuss any aspect of the Company’s business with the news media or the investment community. Officers, directors, associates, or agents may not under any circumstances provide information or discuss matters involving the Company with the news media or investment community even if contacted directly by a media organization or investment entity. All such contact or inquiries should be referred to the Chairman, President or their designate(s).

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Dishonesty and Breach of Trust

An officer, director, associate, or agent shall not use his/her position at one of our affiliates to commit an act that would be considered illegal (e.g. theft, falsifying affiliate records, forgery, check kiting, etc.) All officers, directors, associates, and agents must conduct themselves with honesty and integrity at all times. Suspicious activities must be reported to the Internal Auditor or Security Officer of their respective affiliate. Upon receipt of such report, the Internal Auditor and/or Security Officer will conduct an investigation. All officers, directors, associates, and agents are to cooperate with the resulting investigation. Withholding information or lying to investigators will be cause for immediate termination of employment. All legal violations will be referred to the appropriate police agency for prosecution.

Compliance With Applicable Laws, Rules and Regulations

The Company expects that each and every officer, director, associate, and agent of the Company will comply with all applicable federal, state, local and foreign laws, rules and regulations governing the Company’s business, including insider trading laws. In addition, all officers, directors, associates, and agents are required to respond honestly and candidly when dealing with the Company’s independent public accountants and internal auditors, regulators and attorneys.

While these principles are seemingly self-explanatory, at times, the application of any particular law, rule or regulation to the Company may not be perfectly clear. Where an associate is unsure or has any question as to the application to the Company of any law, rule or regulation, it is expected that the associate will seek appropriate guidance from the Chief Executive Officer of the appropriate affiliate, who may seek guidance from outside counsel to the Company. Officers, directors, and agents of the Company should seek guidance from the Chief Executive Officer of the appropriate affiliate or from outside counsel to the Company. In addition, the Audit Committee is specifically empowered to engage non-Company counsel if or when it believes such engagement is prudent.

Personal Investments

In making personal investments, all officers, directors, associates, and agents shall be guided by a keen awareness of potential conflict. Generally speaking, one’s own investments should not be such as to influence his or her judgment or action in the conduct of the Company’s business or to profit from security transactions made for our affiliates’ customers.

An officer, director, associate, or agent should not enter into a security transaction for his or her own account under conditions where information not generally available to the public is made available to the Company on a confidential basis or for corporate purposes and is used as a basis for the individual’s action; nor should the individual disclose such information to any unauthorized person. The Company has a comprehensive “Insider Trading Policy” which is applicable to all officers, directors, and associates of the Company as well as to each of their immediate family members. The Company expects that every officer, director, and associate will comply, and will cause their family members to comply, with every aspect of the Securities Trading Policy.

Personal Borrowing

Associates and officers of the Company may borrow from other financial institutions, providing all transactions are at arm’s-length, at market prices, and control of the lending situation is clearly in the hands of the lender. An associate may not have lending authority over an account involving themselves, their immediate family, relatives or any related interests. Associates are not permitted to borrow from other customers or suppliers. This prohibition does not preclude the Company from entering into a lending relationship with an individual related to the associate by blood or marriage.

Whenever a senior officer (Vice President and up) of one of our affiliates is extended any credit of at least $10,000 from any source, he or she must make a written report to the affiliate bank’s president. There is no need to disclose those loans that are renewals without advancement of additional principal. This report is to

6

include, in addition to full disclosure of information relative to the subject borrowing, a tabular listing of all credit facilities showing the name of the lender, the date and amount of each extension of credit, the date of maturity, the basis for amortization, the current outstanding balance, the security for each facility, and the purpose. It must be delivered within ten days of the date the extension was granted. Such reports will be reported to the Board of Directors of the senior officer’s affiliate bank, treated confidentially, and maintained in the permanent records of the affiliate bank.

Whenever a junior officer is extended any credit of at least $10,000 from any source, he or she must submit an updated Personal Financial Statement to his/her Affiliate President within 10 days from when the extension of credit was granted.

It is the policy of the Company that credit standards will be consistent for all loan applications and existing clients regardless of race, color, national origin, religion, sex, sexual orientation, age, disability, marital status, veteran’s status or any other legally protected status, provided the applicant meets all other relevant criteria and the capacity to enter into a binding contract.

Annual Personal Financial Statements

Annual personal financial statements are required of all senior officers of our affiliates at year-end, including data for both the senior officer and his or her spouse. The very nature of a bank senior officer’s job requires that full and complete financial disclosures be made at least on an annual basis, and more often as required.

Junior officers need to supply a current personal financial statement only when they borrow funds of at least $10,000 from any source. See “Personal Borrowing Section” for details.

The statements are to be submitted to the Affiliate Bank’s President and will be made available to the internal auditor of Park and to the Chairman and President of Park as requested.

Employment of Relatives

The relatives of officers below the title of Vice President and all remaining associates of our affiliates can be employed by one of our affiliates. Occasionally, our affiliates may employ both spouses, although they will be prohibited from working in the same department or branch office and may not have a reporting relationship.

The children of senior officers (Vice President and above) and directors may be employed as temporary help during their student years in any affiliate bank or company, including that of the senior officer or director parent, but they are not permitted to work in the same office or department as the senior officer or director parent.

Children of senior officers and directors of Park and each of our affiliates are only permitted to have permanent employment in a separate affiliate bank or company than that of the senior officer or director parent. Additionally, the position held by children of senior officers cannot have a reporting relationship to the senior officer parent at another affiliate bank.

Giving Advice to Clients

Clients may occasionally request an opinion on legal or tax transactions. The Company cannot practice law or give legal or tax advice. Accordingly, associates must take care in discussing such transactions so as not to give the impression or allow the client to interpret such discussions as providing legal or tax advice.

Privacy Principles

The Company is committed to protecting customer privacy and the confidentiality of all customer information. Park follows the Banking Industry Privacy Principles for U.S. Financial Institutions, which is attached to and incorporated as part of this Code of Ethics.

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Assistance in Meeting the Company’s Accounting, Financial Reporting and Disclosure Obligations

In compliance with the rules and regulations of the U.S. Securities and Exchange Commission and the American Stock Exchange, the Company is required to issue financial statements in conformity with generally accepted accounting principles and then make public disclosures regarding certain aspects of its business. It is expected that all officers, directors, and associates of the Company will keep accurate and complete books, records and accounts that enable the Company to meet its accounting and financial reporting obligations. It is expected that any officer, director, or associate of the Company involved in preparing the Company’s disclosures, or any associate or officer asked to provide information relevant to such disclosure, will work to ensure that our public reports and communications are fair, accurate, certifiable, complete, objective, relevant, timely, and understandable. Any associate or officer who, in good faith, believes that the Company’s accounting method is inappropriate or not in compliance with generally accepted accounting principles, or has concerns about any questionable accounting or auditing matter or any other accounting, internal accounting control or auditing matter, should report this finding directly to Park’s Chief Financial Officer and, if unsatisfied with the response, directly to the Audit Committee. The Audit Committee has established a procedure for such reports that ensures the confidentiality of the reporting person. Associates and officers may call the Park Improvement Line at 1-800-418-6423 (Ext. 775). In addition, any officer or associate who becomes aware of a material event or fact involving the Company that has not been previously disclosed publicly by the Company should immediately report such material event or fact to Park’s Chief Financial Officer or the Chief Executive Officer of the appropriate affiliate.

Pre-Employment Screening

The Company uses a risk-based approach when deciding what level of pre-employment screening is required for new associates and agents of Park or one of its affiliates. These can include, but not be limited to, drug screens, credit reports and employment and personal reference checks.

Post-Employment Activities

At the time of termination or resignation, departing officers, directors, associates, and agents will be required to return all Company property in their possession or control, including but not limited to electronic or written Company documents, files, computer diskettes, reports and records containing any Company or nonpublic information, along with all copies thereof. A departed officer, director, associate, or agent remains obligated by law not to disclose to any third party or use for his/her own purposes any confidential or proprietary information to which the officer, director, associate, or agent had access while employed by the Company. A departed officer, director, associate, or agent is also expected not to disparage the Company or engage in activity that damages the Company’s reputation or business, since such activity may also be unlawful.

Violations of Policies

There are many other policies that are very important to the Company and its operations. Nothing herein shall relieve any officer, director, associate, or agent of the Company from complying with all other applicable company policies.

Violations of any of the Company’s board-approved policies may be cause for disciplinary action, including termination of employment.

The Company expects full compliance with this Code of Ethics. In that regard, associates are encouraged to report any violation of the Code of Ethics to their supervisor, Internal Audit Department, Human Resources representative or to their respective Chief Executive Officer. Officers and directors must report any violation of the Code of Ethics to the Audit Committee. Associates, including Officers, may also report suspected violations of the Code of Ethics to the Park Improvement Line, a confidential telephone number established for these purposes. The Company will not permit any retaliation against an officer, director, associate, or agent who properly reports (to the appropriate personnel) a matter that he or she believes, in good faith, to be a violation of the Code of Ethics. Reports to the Audit Committee may be made on a confidential basis through the procedure established by the Audit Committee. Any officer, director, associate, or agent who is found to have violated the Code of Ethics may be subject to discipline, including termination of employment.

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The Audit Committee shall investigate any alleged violation of the Code of Ethics by any of the Company’s officers, directors, associates, or agents. In the event that the Audit Committee determines that a violation of the Code of Ethics has occurred, the Audit Committee shall be authorized to take any action it deems appropriate. If the violation involves an executive officer or director of Park, the Audit Committee shall notify Park’s Board of Directors and the Board shall take such action as it deems appropriate. In the event that Park’s Board of Directors recognizes that a violation by an executive officer or a director of Park has occurred but elects not to take any remedial or other action against the offending executive officer or director, Park shall disclose the facts and circumstances of its election to waive the Code of Ethics by posting the same on Park’s web site or by any other such means as may be required under applicable law or the requirements of the Securities and Exchange Commission or the American Stock Exchange.

Also, nothing in this Code of Ethics affects the general policy of the Company that employment is at will and can be terminated by the Company at any time and for any or no reason.

Privacy Principles

1. Recognition of a Customer’s Expectation of Privacy

The Company will recognize and respect the privacy expectations of our customers and explain principles of financial privacy to our customers in an appropriate fashion.

2. Use, Collection and Retention of Customer Information

The Company will collect, retain, and use information about individual customers only where we reasonably believe it would be useful (and allowed by law) to administering our business and to provide products, services and other opportunities to our customers.

3. Maintenance of Accurate Information

The Company will maintain procedures so that our customers’ financial information is accurate, current and complete in accordance with reasonable commercial standards. We will also respond to requests to correct inaccurate information in a timely manner.

4. Limiting Associate Access to Information

The Company will take reasonable steps to limit access by our associates to personally identifiable information to those with a business reason for knowing such information. We will continue to educate our associates so that they will understand the importance of confidentiality and customer privacy. We will also take appropriate disciplinary measures to enforce associate privacy responsibilities.

5. Protection of Information via Established Security Procedures

The Company will maintain appropriate security standards and procedures regarding unauthorized access to customer information.

6. Restrictions on the Disclosure of Account Information

The Company will not reveal specific information about customer accounts or other personally identifiable data to unaffiliated third parties for their independent use, except for the exchange of information with reputable information reporting agencies to maximize the accuracy and security of such information in the performance of bona fide corporate due diligence, unless (1) the information is provided to help complete a customer-initiated transaction; (2) the customer requests it; (3) the disclosure is required or allowed by law (i.e. subpoena, investigation of fraudulent activity, etc.); or (4) the customer has been informed about the possibility of such disclosure for marketing or similar purposes through a prior communication and is given the opportunity to decline (i.e. “opt out”).

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7. Maintaining Customer Privacy in Business Relationships with Third Parties

If personally identifiable customer information is provided to a third party, the Company will insist that the third party adhere to similar Privacy Principles that provide for keeping such information confidential.

8. Disclosure of Privacy Principles to Customers

The Company will devise methods of providing our customers with an understanding of our privacy policies.

If you have any comments or suggestions regarding this policy please contact Laura B. Lewis at (740) 349-3750. If you have comments or suggestions on overall policy administration or governance please contact David L. Trautman at PNB (740) 349-3927.

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ASSOCIATE’S ACKNOWLEDGEMENT
OF PARK NATIONAL CORPORATION
CODE OF BUSINESS CONDUCT AND ETHICS

The foregoing Code of Business Conduct and Ethics (the “Code of Ethics”) will not answer or resolve every question you may have. If you are uncertain about what the right thing to do is, you are encouraged to seek the advice and guidance of your supervisor, your Human Resources representative or your Chief Executive Officer.

YOU MAY ALWAYS DIRECTLY REPORT ANY MATTER WHICH YOU BELIEVE, IN GOOD FAITH, TO BE A VIOLATION OF THE FOREGOING CODE OF ETHICS TO PARK’S CHIEF EXECUTIVE OFFICER OR AUDIT COMMITTEE OF PARK’S BOARD OF DIRECTORS ON A CONFIDENTIAL BASIS. YOU MAY ALSO CALL THE PARK IMPROVEMENT LINE AT 1-800-418-6423 (Ext. 775).

I have read and understand the foregoing Code of Ethics, have been given a copy to retain for my reference, and agree to be bound by its terms. I understand I can be subject to discipline, dismissal from my job and prosecution under the law for violating any of the above provisions of the Code of Ethics.

Print Name	Social Security Number
	/                                      /
Signature	Date

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OFFICER’S ACKNOWLEDGEMENT
OF PARK NATIONAL CORPORATION
CODE OF BUSINESS CONDUCT AND ETHICS

The foregoing Code of Business Conduct and Ethics (the “Code of Ethics”) will not answer or resolve every question you may have. If you are uncertain about what the right thing to do is, you are encouraged to seek the advice and guidance of your affiliate’s Chief Executive Officer.

YOU MAY ALWAYS DIRECTLY REPORT ANY MATTER WHICH YOU BELIEVE, IN GOOD FAITH, TO BE A VIOLATION OF THE FOREGOING CODE OF ETHICS TO PARK’S CHIEF EXECUTIVE OFFICER OR TO THE AUDIT COMMITTEE OF PARK’S BOARD OF DIRECTORS ON A CONFIDENTIAL BASIS. YOU MAY ALSO CALL THE PARK IMPROVEMENT LINE AT 1-800-418-6423 (Ext. 775).

I have read and understand the foregoing Code of Ethics, have been given a copy to retain for my reference, and agree to be bound by its terms. I understand I may be subject to discipline, dismissal from my job and prosecution under the law for violating any of the above provisions of the Code of Ethics.

Print Name	Social Security Number
	/                                      /
Signature	Date

12

DIRECTOR’S ACKNOWLEDGEMENT
OF PARK NATIONAL CORPORATION
CODE OF BUSINESS CONDUCT AND ETHICS

The foregoing Code of Business Conduct and Ethics (the “Code of Ethics”) will not answer or resolve every question you may have. If you are uncertain about what the right thing to do is, you are encouraged to seek the advice and guidance of outside counsel to Park National Corporation (“Park”) or other counsel designated by the Audit Committee of the Board of Directors of Park.

YOU MAY ALWAYS DIRECTLY REPORT ANY MATTER WHICH YOU BELIEVE, IN GOOD FAITH, TO BE A VIOLATION OF THE FOREGOING CODE OF ETHICS TO THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS OR THE FULL BOARD.

I have read and understand the foregoing Code of Ethics, have been given a copy to retain for my reference, and agree to be bound by its terms. I understand I can be subject to discipline, removal for cause from the Board of Directors and prosecution under the law for violating any of the above provisions of the Code of Ethics.

Print Name	Social Security Number
	/                                      /
Signature	Date

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EX-21

Exhibit 21

SUBSIDIARIES OF PARK NATIONAL CORPORATION

Name of Subsidiary	Jurisdiction of Incorporation or Formation
The Park National Bank (“PNB”)	United States (federally-chartered national banking association)
•   Park Investments, Inc. (NOTE: is a wholly-owned subsidiary of PNB)	Delaware
•   Scope Leasing, Inc. (NOTE: is a wholly-owned subsidiary of PNB) [Also does business under “Scope Aircraft Finance”]	Ohio
•   Park Leasing Company (NOTE: is a wholly-owned subsidiary of PNB)	Ohio
•   Park Insurance Group, Inc. (NOTE: is a wholly-owned subsidiary of PNB)	Ohio
•   Park Title Agency, LLC. (NOTE: PNB held 80% of ownership interest as of February 25, 2009 but will sell 31% of ownership interest to other member effective at the close of business on February 27, 2009)	Ohio
•   The following are the divisions of PNB:
•   Fairfield National Bank	n/a
•   The Park National Bank of Southwest Ohio & Northern Kentucky	n/a
•   Century National Bank	n/a
•   Second National Bank	n/a
•   Richland Bank	n/a
•   United Bank	n/a
•   First-Knox National Bank	n/a
•   Farmers Bank (also sometimes known as “Farmers and Savings Bank”)	n/a
•   Security National Bank	n/a
•   Unity National Bank	n/a
•   Citizens National Bank	n/a

Name of Subsidiary	Jurisdiction of Incorporation or Formation
•   Consolidated Computer Center	n/a
Guardian Financial Services Company [Also does business under “Guardian Finance Company”]	Ohio
Park Capital Investments, Inc. (“Park Capital”)	Delaware
•   Park National Capital LLC (NOTE: members are Park Capital and PNB)	Delaware
•   Security National Capital LLC (NOTE: members are Park Capital and PNB)	Delaware
•   First-Knox National Capital LLC (NOTE: members are Park Capital and PNB)	Delaware
•   Century National Capital LLC (NOTE: members are Park Capital and PNB)	Delaware
Vision Bank	Florida
•   The following are the divisions of Vision Bank:
•   Vision Bank Division of Gulf Shores, Alabama	n/a
•   Vision Bancshares Financial Group	n/a
Vision Bancshares Trust I	Delaware
(NOTE: Park holds all of the common securities as successor Depositor; floating rate preferred securities are held by institutional investors)

-2- 

EX-23

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in the following Registration Statements of Park National Corporation:

Form S-8 No. 33-92060
Form S-8 No. 333-52653
Form S-8 No. 333-59360
Form S-8 No. 333-59378
Form S-8 No. 333-91178
Form S-8 No. 333-115136
Form S-8 No. 333-126875
Form S-3 No. 333-156887

of our report dated February 25, 2009, with respect to the consolidated financial statements of Park National Corporation and the effectiveness of internal control over financial reporting, which report is incorporated by reference from Park National Corporation’s 2008 Annual Report to Shareholders in this Annual Report on Form 10-K of Park National Corporation for the fiscal year ended December 31, 2008.

/s/ Crowe Horwath LLP
Crowe Horwath LLP

Columbus, Ohio
February 25, 2009

EX-24

Exhibit 24

POWER OF ATTORNEY

     The undersigned officer and director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ C. Daniel DeLawder  

C. Daniel DeLawder 

POWER OF ATTORNEY

     The undersigned officer and director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ David L. Trautman  

David L. Trautman 

POWER OF ATTORNEY

     The undersigned officer of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder and David L. Trautman, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ John W. Kozak  

John W. Kozak 

POWER OF ATTORNEY

     The undersigned officer of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ Brady T. Burt  

Brady T. Burt 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ Nicholas L. Berning  

Nicholas L. Berning 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in her name and on her behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as she could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ Maureen Buchwald  

Maureen Buchwald 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ James J. Cullers  

James J. Cullers 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ Harry O. Egger  

Harry O. Egger 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ F. William Englefield IV  

F. William Englefield IV 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ William T. McConnell  

William T. McConnell 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ John J. O’Neill  

John J. O’Neill 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ William A. Phillips  

William A. Phillips 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ J. Gilbert Reese  

J. Gilbert Reese 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ Rick R. Taylor  

Rick R. Taylor 

POWER OF ATTORNEY

     The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2008, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and John W. Kozak, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10-K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

     IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23^rd day of February, 2009.

/s/ Leon Zazworsky  

Leon Zazworsky 

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, C. Daniel DeLawder, certify that:

1.	I have reviewed this Annual Report on Form 10-K for the fiscal year ended December 31, 2008 of Park National Corporation;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report)

that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 25, 2009	By:	/s/ C. Daniel DeLawder
		Printed Name:	C. Daniel DeLawder
		Title:	Chairman of the Board and Chief Executive Officer

2

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, John W. Kozak, certify that:

1.	I have reviewed this Annual Report on Form 10-K for the fiscal year ended December 31, 2008 of Park National Corporation;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report)

that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 25, 2009	By:	/s/ John W. Kozak
		Printed Name:	John W. Kozak
		Title:	Chief Financial Officer

2

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO
SECTION 1350 OF CHAPTER 63 OF
TITLE 18 OF THE UNITED STATES CODE*

     In connection with the Annual Report of Park National Corporation (the “Corporation”) on Form 10-K for the fiscal year ended December 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned C. Daniel DeLawder, Chairman of the Board and Chief Executive Officer of the Corporation, and John W. Kozak, Chief Financial Officer of the Corporation, certify, pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2)	The information contained in the Report fairly presents, in all material respects, the consolidated financial condition and results of operations of the Corporation and its subsidiaries.

/s/ C. Daniel DeLawder	/s/ John W. Kozak
C. Daniel DeLawder Chairman of the Board and Chief Executive Officer (Principal Executive Officer)	John W. Kozak Chief Financial Officer (Principal Financial Officer)
Dated: February 25, 2009	Dated: February 25, 2009

* This certification is being furnished as required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 1350 of Chapter 63 of Title 18 of the United States Code, and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that Section. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Corporation specifically incorporates this certification by reference.