SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D. C. 20549


                                    FORM 10-Q


               QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934



For the quarterly period ended June 30, 2002   Commission File number: 000-22054



                           COMMUNITY BANKSHARES, INC.
             (Exact Name of Registrant as Specified in its Charter)

         South Carolina                                 57-0966962
 (State or Other Jurisdiction of            (IRS Employer Identification Number)
  Incorporation or Organization)


               791 Broughton St., Orangeburg, South Carolina 29115
                (Address of Principal Executive Office, Zip Code)


                                 (803) 535-1060
              (Registrant's telephone number, including area code)



         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. Yes [X]   No [ ]

         State the number of shares  outstanding of each of the issuer's classes
of common equity, as of the latest practicable date:  4,304,384 shares of common
stock outstanding as of August 1, 2002.


<Page>



                             10-Q TABLE OF CONTENTS

                        Part I-Financial Statements                         Page
      Item 1       Financial Statements .....................................  3
      Item 2       Management's Discussion and Analysis of
                    Financial Condition and Results of Operations ........... 11
      Item 3       Quantitative and Qualitative Disclosures
                    About Market Risk ....................................... 21

                           Part II-Other Information
      Item 4       Submission of Matters to a Vote of Security Holders ...... 22
      Item 6       Exhibits and Reports on Form 8-K ......................... 23



                                       2
<Page>


Part I. Item 1. Financial Statements

            COMMUNITY BANKSHARES, INC. - CONSOLIDATED BALANCE SHEETS

<Table>
<Caption>
        ($ amounts in thousands)                                                                   UNAUDITED
                                                                                                    June 30,            December 31,
         ASSETS                                                                                       2002                  2001
                                                                                                      ----                  ----
Cash and due from other financial institutions:
<S>                                                                                                <C>                    <C>
     Non-interest bearing ............................................................             $  12,470              $  14,586
     Federal funds sold ..............................................................                10,203                 11,063
                                                                                                   ---------              ---------
         Total cash and cash equivalents .............................................                22,673                 25,649
Interest bearing deposits in other banks .............................................                   809                  2,376
Investment securities:
     Securities held to maturity .....................................................                   500                    500
     Securities available for sale ...................................................                40,450                 43,207
Loans held for resale ................................................................                 9,860                 10,265

Loans ................................................................................               244,993                229,905
     Less, allowance for loan losses .................................................                (2,860)                (2,830)
                                                                                                   ---------              ---------
         Net loans ...................................................................               242,133                227,075

Premises and equipment ...............................................................                 5,461                  5,177
Accrued interest  receivable .........................................................                 1,849                  1,762
Deferred income taxes ................................................................                   767                    870
Goodwill .............................................................................                   921                    921
Other assets .........................................................................                   460                    815
                                                                                                   ---------              ---------

         Total assets ................................................................             $ 325,883              $ 318,617
                                                                                                   =========              =========

         LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
     Non-interest bearing ............................................................             $  35,261              $  35,882
     Interest bearing ................................................................               225,547                219,551
                                                                                                   ---------              ---------
         Total deposits ..............................................................               260,808                255,433
Federal funds purchased and securities
     sold under agreements to repurchase .............................................                 4,720                  4,171
Federal Home Loan Bank advances ......................................................                20,280                 20,280
Lines of credit payable ..............................................................                 8,526                  9,028
Other liabilities ....................................................................                 2,081                  2,158
                                                                                                   ---------              ---------
         Total liabilities ...........................................................               296,415                291,070
                                                                                                   ---------              ---------

Shareholders' equity:
     Common stock
         No par, authorized shares 12,000,000, issued and
         outstanding 3,304,384 in 2002 and 3,299,674 in 2001 .........................                17,150                 17,208
     Retained earnings ...............................................................                12,153                 10,346
     Accumulated other comprehensive income (loss) ...................................                   165                     (7)
                                                                                                   ---------              ---------
         Total shareholders' equity ..................................................                29,468                 27,547
                                                                                                   ---------              ---------

         Total liabilities and shareholders' equity ..................................             $ 325,883              $ 318,617
                                                                                                   =========              =========
</Table>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS



                                       3
<Page>

             COMMUNITY BANKSHARES, INC. - CONSOLIDATED STATEMENTS OF
                         CHANGES IN SHAREHOLDERS' EQUITY
           for the six months ended June 30, 2002 and 2001 (Unaudited)
                            ($ amounts in thousands)

<Table>
<Caption>
                                                                                                         Accumulated
                                                                                                            Other           Total
                                                         Number of                        Retained      Comprehensive  Shareholders'
                                                          Shares             Amount       Earnings      Income (Loss)     Equity
                                                          ------             ------       --------       ------------     ------


<S>                                                       <C>            <C>             <C>             <C>             <C>
Balances at Dec. 31, 2000 ..........................      3,199,180      $   15,928      $    7,342      $     (131)     $   23,139
Comprehensive income:
  Net income .......................................                                          1,831                           1,831
  Change in unrealized gain (loss) on
       securities available for sale, net
       of tax effect ...............................                                                            188             188
Shares issued under option agreement ...............          5,040              39                                              39
Dividends paid .....................................              -               -            (447)              -            (447)
                                                         ----------      ----------      ----------      ----------      ----------
Balances at June 30, 2001 ..........................      3,204,220      $   15,967      $    8,726      $       57      $   24,750
                                                         ==========      ==========      ==========      ==========      ==========

Balances at Dec. 31, 2001 ..........................      3,299,674      $   17,208      $   10,346      $       (7)     $   27,547
Comprehensive income:
  Net income .......................................                                          2,336                           2,336
  Change in unrealized gain (loss) on
       securities available for sale, net
       of tax effect ...............................                                                            172             172
Shares issued under option agreement ...............          4,710              40                                              40
Expense associated with pending merger .............                            (98)                                            (98)
Dividends paid .....................................              -               -            (529)              -            (529)
                                                         ----------      ----------      ----------      ----------      ----------
Balances at June 30, 2002 ..........................      3,304,384      $   17,150      $   12,153      $      165      $   29,468
                                                         ==========      ==========      ==========      ==========      ==========
</Table>



THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS














                                       4
<Page>



         COMMUNITY BANKSHARES, INC. - CONSOLIDATED STATEMENTS OF INCOME

<Table>
<Caption>
                                                                           Six months ended June 30,     Three months ended June 30,
                                                                             2002              2001            2002          2001
         (In thousands, except per share data)                            UNAUDITED         UNAUDITED       UNAUDITED      UNAUDITED
                                                                          ---------         ---------       ---------      ---------
Interest and dividend income:
<S>                                                                          <C>             <C>             <C>             <C>
     Loans, including fees .........................................         $ 8,666         $ 9,116         $ 4,342         $ 4,525
     Deposits with other financial institutions ....................              10             106               4              78
     Debt securities ...............................................             858           1,194             483             469
     Dividends .....................................................              63              69              32              33
     Federal funds sold ............................................             167             454              80             284
                                                                             -------         -------         -------         -------
          Total interest and dividend income .......................           9,764          10,939           4,941           5,389
                                                                             -------         -------         -------         -------

Interest expense:
     Deposits:
       Certificates of deposit of $100,000 or more .................             914           1,310             446             662
       Other .......................................................           2,206           3,528           1,054           1,714
                                                                             -------         -------         -------         -------
          Total deposits ...........................................           3,120           4,838           1,500           2,376
     Federal funds purchased and securities
       sold under agreements to repurchase .........................              44             149              22              66
     Other borrowed funds ..........................................             706             596             342             295
                                                                             -------         -------         -------         -------
          Total interest expense ...................................           3,870           5,583           1,864           2,737
                                                                             -------         -------         -------         -------
Net interest income ................................................           5,894           5,356           3,077           2,652
Provision for loan losses ..........................................             358             277             189             135
                                                                             -------         -------         -------         -------
Net interest income after provision for loan losses ................           5,536           5,079           2,888           2,517
                                                                             -------         -------         -------         -------

Non-interest income:
     Service charges on deposit accounts ...........................           1,082             928             538             516
     Gains on sales of securities ..................................             104               -              62               -
     Mortgage banking income .......................................           1,948               -             992               -
     Other .........................................................             303             315             158             176
                                                                             -------         -------         -------         -------
          Total non-interest income ................................           3,437           1,243           1,750             692
                                                                             -------         -------         -------         -------

Non-interest expense:
     Salaries and employee benefits ................................           3,383           2,102           1,728           1,062
     Premises and equipment ........................................             605             471             308             236
     Other .........................................................           1,335             916             709             479
                                                                             -------         -------         -------         -------
          Total non-interest expense ...............................           5,323           3,489           2,745           1,777
                                                                             -------         -------         -------         -------

Income before income taxes .........................................           3,650           2,833           1,893           1,432
Income tax expense .................................................           1,314           1,002             682             502
                                                                             -------         -------         -------         -------
Net income .........................................................         $ 2,336         $ 1,831         $ 1,211         $   930
                                                                             =======         =======         =======         =======
</Table>




                                       5
<Page>

<Table>
<Caption>
                                                                  Six months ended June 30,            Three months ended June 30,
                                                                    2002              2001               2002              2001
                                                                 UNAUDITED         UNAUDITED          UNAUDITED          UNAUDITED
                                                                 ---------         ---------          ---------          ---------


Basic earnings per common share:
<S>                                                           <C>                 <C>                 <C>                 <C>
     Weighted average shares outstanding ...........           3,299,834           3,199,180           3,299,754           3,199,180
     Net income per common share ...................          $     0.71          $     0.57          $     0.37          $     0.29
Diluted earnings per common share:
     Weighted average shares outstanding ...........           3,404,733           3,217,067           3,382,921           3,217,067
     Net income per common share ...................          $     0.69          $     0.57          $     0.36          $     0.29
</Table>



THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS










                                       6
<Page>




COMMUNITY BANKSHARES, INC. - CONSOLIDATED STATEMENTS OF CASH FLOWS

<Table>
<Caption>
                                                                                                          Six months ended June 30,
                                                                                                          2002               2001
                                                                                                          ----               ----
                                                                                                               (In thousands)
Cash flows from operating activities:
<S>                                                                                                      <C>               <C>
Net income .....................................................................................         $  2,336          $  1,831
Adjustments to reconcile net income to net cash used in operating activities:
         Depreciation ..........................................................................              160               218
         Provision for loan losses .............................................................              358               277
         Accretion of discounts and amortization of premiums -
           investment securities - net .........................................................               (1)              (13)
         Net realized (gains) on sale of securities ............................................             (104)                -
         Proceeds from sale of real estate loans held for sale .................................           74,766             6,289
         Origination of real estate loans held for sale ........................................          (74,361)           (6,352)
Changes in assets and liabilities:
         (Increase) decrease in interest receivable ............................................              (87)              555
         Decrease in other assets ..............................................................              458                98
         Decrease in other liabilities .........................................................              (77)             (127)
                                                                                                         --------          --------
Net cash provided by operating activities ......................................................            3,448             2,776
                                                                                                         --------          --------

Cash flows from investing activities:
         Proceeds from maturities of
           investment securities - held to maturity ............................................                -             8,875
         Purchases of investment securities - held to maturity .................................                -              (652)
         Purchases of investment securities - available for sale ...............................          (30,591)          (29,673)
         Proceeds from maturities of available for sale securities .............................           15,096            43,716
         Proceeds from sales of available for sale securities ..................................           18,529                 -
         Net (increase) decrease in interest bearing deposits ..................................            1,567            (3,883)
         Net increase in loans to customers ....................................................          (15,683)          (13,350)
         Proceeds from sale of other real estate owned .........................................              267                 -
         Purchase of premises and equipment ....................................................             (444)             (156)
                                                                                                         --------          --------
           Net cash provided (used) by investing activities ....................................          (11,259)            4,877
                                                                                                         --------          --------

Cash flows from financing activities:
         Net increase in demand, savings, & time deposits ......................................            5,375            13,688
         Net increase  (decrease) in federal funds purchased and
           securities sold under agreements to repurchase ......................................              549              (773)
         Net principal reduction under lines of credit agreements ..............................             (502)                -
         Repayment of FHLB advances ............................................................                -            (2,500)
         Sale of common stock ..................................................................               40                39
         Merger expenses .......................................................................              (98)                -
         Dividends .............................................................................             (529)             (447)
                                                                                                         --------          --------
           Net cash provided by financing activities ...........................................            4,835            10,007
                                                                                                         --------          --------
</Table>




                                       7
<Page>


<Table>
<Caption>
                                                                                                       Six months ended June 30,
                                                                                                        2002                 2001
                                                                                                        ----                 ----
                                                                                                              (In thousands)
<S>                                                                                                 <C>                     <C>
Net increase  (decrease) in cash and due from other
         financial institutions .....................................................                 (2,976)                 17,660
Cash and due from other financial institutions -
         beginning of period ........................................................                 25,649                  18,339
                                                                                                    --------                --------
Cash and due from other financial institutions -
         end of period ..............................................................               $ 22,673                $ 35,999
                                                                                                    ========                ========
</Table>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS




















                                       8
<Page>

Notes to Unaudited Consolidated Financial Statements

Summary of Significant Accounting Principles

         A summary of significant  accounting policies and the audited financial
statements for 2001 are included in Company's Annual Report on Form 10-K for the
year ended December 31, 2001.

Principles of Consolidation

         The consolidated financial statements include the accounts of Community
Bankshares,  Inc. (CBI or the Corporation),  the parent company,  and Orangeburg
National  Bank,  Sumter  National  Bank,  Florence  National  Bank and Community
Resource  Mortgage  Inc.,  its  wholly  owned   subsidiaries.   All  significant
intercompany items have been eliminated in the consolidated statements.

Management Opinion

         The interim financial  statements in this report are unaudited.  In the
opinion of management, all the adjustments necessary to present a fair statement
of the results for the interim period have been made. Such  adjustments are of a
normal and recurring nature.

         The results of operations  for any interim  period are not  necessarily
indicative  of the  results to be expected  for an entire  year.  These  interim
financial  statements  should be read in conjunction  with the annual  financial
statements and notes thereto contained in the 2001 Annual Report on Form 10-K.

Changes in Comprehensive Income Components

         The Financial  Accounting Standards Board issued Statement of Financial
Accounting  Standards No. 130, "Reporting  Comprehensive  Income," effective for
fiscal years  beginning  after  December 15, 1997.  This  Statement  establishes
standards  for  reporting  and  disclosure  of  comprehensive   income  and  its
components in a full set of general-purpose financial statements.  Disclosure as
required by the Statement is as follows:

<Table>
<Caption>
                                                                                                           Six months ended June 30,
                                                                                                            2002              2001
                                                                                                            ----              ----
                                                                                                            (Dollars in thousands)
<S>                                                                                                      <C>                  <C>
Unrealized holding gains (losses) on available for sale
     securities ..........................................................................               $ 354                $ 285
Less: Reclassification adjustment for gains (losses)
     realized in income ..................................................................                 104                    -
                                                                                                         -----                -----
Net unrealized gains (losses) ............................................................                 261                  285
Tax effect ...............................................................................                 (89)                 (97)
                                                                                                         -----                -----

Net-of-tax amount ........................................................................               $ 172                $ 188
                                                                                                         =====                =====
</Table>






                                       9
<Page>


     COMMUNITY BANKSHARES, INC. - AVERAGE BALANCE SHEETS, YIELDS, AND RATES

<Table>
<Caption>
Six months ended June 30,                                                    2002                                2001
$ in thousands                                                             Interest                            Interest
                                                              Average       Income/   Yields/     Average       Income/      Yields/
                   Assets                                     Balance       Expense     Rates     Balance      Expense       Rates
                                                              -------      --------    ------     -------      --------      -----

<S>                                                        <C>            <C>           <C>    <C>            <C>              <C>
Interest bearing deposits ............................     $   1,311      $      10     1.53%  $   4,427      $     106        4.79%
Investment securities taxable ........................        40,229            916     4.55%     39,370          1,250        6.35%
Investment securities--tax exempt* ...................           269              5     5.63%        730             13        5.40%
Federal funds sold ...................................        19,884            167     1.68%     18,900            454        4.80%
Loans receivable .....................................       247,983          8,666     6.99%    201,885          9,116        9.03%
                                                           ---------       --------            ---------       --------
  Total interest earning assets ......................       309,676          9,764     6.31%    265,312         10,939        8.25%
Cash and due from banks ..............................        11,952                               9,019
Allowance for loan losses ............................        (2,947)                             (2,547)
Premises and equipment ...............................         5,539                               4,401
Goodwill .............................................           921                                   -
Other assets .........................................         3,022                               3,159
                                                           ---------                           ---------
  Total assets .......................................     $ 328,163                           $ 279,344
                                                           =========                           =========

    Liabilities and Shareholders' Equity
Interest bearing deposits
Savings ..............................................     $  46,577      $     403     1.73%  $  36,526      $     651        3.56%
Interest bearing transaction accounts ................        42,158            171     0.81%     23,063            123        1.07%
Time deposits ........................................       142,278          2,546     3.58%    135,934          4,064        5.98%
                                                           ---------       --------            ---------       --------
  Total interest bearing deposits ....................       231,013          3,120     2.70%    195,523          4,838        4.95%
Short term borrowing .................................         4,603             44     1.91%      7,391            149        4.03%
Other borrowings .....................................        27,512            706     5.13%     20,295            596        5.87%
                                                           ---------       --------            ---------       --------
  Total interest bearing liabilities .................       263,128          3,870     2.94%    223,209          5,583        5.00%
Noninterest bearing demand deposits ..................        34,344                              30,332
Other liabilities ....................................         2,025                               1,750
Shareholders' equity .................................        28,666                              24,053
                                                           ---------                           ---------
  Total liabilities and shareholders' equity .........     $ 328,163                           $ 279,344
                                                           =========                           =========

Interest rate spread .................................                                  3.37%                                  3.25%
Net interest income and net yield on
     earning assets ..................................                    $   5,894     3.81%                 $   5,356        4.04%
                                                                          =========     ====                  =========        ====
</Table>

* Yields are quoted as fully taxable equivalents





                                       10
<Page>



Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations

Forward Looking Statements

         Statements   included  in  Management's   Discussion  and  Analysis  of
Financial Condition and Results of Operations which are not historical in nature
are intended to be, and are hereby  identified as `forward  looking  statements'
for  purposes  of the safe  harbor  provided  by Section  21E of the  Securities
Exchange Act of 1934, as amended.  The words "estimate,"  "project,"  "intend,",
"expect,"  "believe,"  "anticipate,"  "plan," and similar  expressions  identify
forward-looking  statements.  The  Corporation  cautions  readers  that  forward
looking  statements,   including  without  limitation,  those  relating  to  the
Corporation's  future  business  prospects,  ability to  successfully  integrate
recent and proposed acquisitions,  revenues, working capital, liquidity, capital
needs,   interest  costs,   and  income,   are  subject  to  certain  risks  and
uncertainties  that could cause actual results to differ  materially  from those
indicated in the forward looking  statements,  due to several  important factors
herein  identified,  among others,  and other risks and factors  identified from
time to time in the Corporation's reports filed with the Securities and Exchange
Commission.


RESULTS OF  OPERATIONS  FOR THE SIX MONTHS ENDED JUNE 30, 2002  COMPARED TO JUNE
30, 2001

Net Income

         For  the  first  half of 2002  CBI  earned  a  consolidated  profit  of
$2,336,000  compared to  $1,831,000  for the first half of 2001,  an increase of
27.6% or  $505,000.  Basic  earnings  per  share  were  $.71 in the 2002  period
compared to $.57 for the 2001  period.  Diluted  earnings per share were $.69 in
the 2002 period compared to $.57 for the 2001 period.

         For the first half of 2002  Orangeburg  National Bank reported a profit
of $1,410,000  compared to $1,222,000 for the first half of 2001, an increase of
15.4% or $188,000.

         For the first half of 2002 Sumter  National  Bank  reported a profit of
$630,000  compared to $552,000 for the first half of 2001, an increase of 14.31%
or $78,000.

         For the first half of 2002 Florence  National Bank reported a profit of
$155,000 compared to $86,000 for the first half of 2001, an increase of 80.2% or
$69,000. The Florence bank began operation in July 1998.

         For the first half of 2002 Community  Resource Mortgage Inc. reported a
profit of $207,000.  The company acquired the mortgage company in November 2001,
so there are no comparative numbers available.

         As noted above,  consolidated  net income for the six months ended June
30,  2002,  increased  from  the  prior  year by 27.6% or  $505,000.  The  major
components  of this  increase are discussed  below.  Net interest  income before
provision  for loan losses for the six months  ended June 30, 2002  increased to
$5,894,000  compared to  $5,356,000  for the same period in 2001, an increase of


                                       11
<Page>

10% or $538,000.  For the same period the provision for loan losses was $358,000
compared  to  $277,000  for the 2001  period,  an  increase of 29.2% or $81,000.
Non-interest  income for the 2002 period increased to $3,437,000 from $1,243,000
for  the  2001  period,  a 177% or  $2,194,000  increase.  Non-interest  expense
increased to $5,323,000 from  $3,489,000,  a 52.6% or $1,834,000  increase.  The
large  percentage  increases  in  noninterest  income  and  expense  are  mostly
associated with the addition of the mortgage company to the corporate group.


Profitability

         Profitability  may be  measured  through  the ROA  (return  on  average
assets) and the ROE (return on average  equity).  Return on assets is the income
for the period divided by the average assets for the period, annualized.  Return
on equity is the  income for the period  divided by the  average  equity for the
period, annualized. Operating results for the six months ended June 30, 2002 and
2001 yield the results in the table shown below.

                                      Period ended June 30,
                                   2002                  2001
                                   ----                  ----
                                     (dollars in thousands)
Average assets                   $328,163              $279,344
ROA                                 1.42%                 1.31%
Average equity                    $28,666               $24,053
ROE                                16.30%                15.22%
Net income                         $2,336                $1,831


Net interest income

         Net interest income, the major component of CBI's income, is the amount
by which interest and fees on interest  earning assets exceeds the interest paid
on interest bearing deposits and other interest bearing funds.  During the first
six months of 2002 net interest income after provision for loan losses increased
to  $5,536,000  from  $5,079,00,  a 9% or $457,000  increase  over the first six
months of 2001. This improvement was mostly the result of a $44 million increase
in the average  volume of earning  assets.  The average yield on earning  assets
decreased  to 6.31% for the 2002  period  from 8.25% for the 2001  period.  This
decline  in yield was the result of market  interest  rate  declines.  When 2001
began the prime lending rate was 9.5%, by year end 2001 it was at 4.75% where it
has remained through the middle of 2002.

         For the first  six  months  of 2002 the cost of funds  averaged  2.94%,
decreased  from  5.00%  for the first six  months of 2001.  The  effect of these
changes was a net interest spread (yield on earning assets less cost of interest
bearing  liabilities) of 3.37% for the first six months of 2002,  increased from
3.25%  during  the first six  months of 2001.  CBI's net  interest  margin  (net
interest  income  divided by total  earning  assets) was 3.81% for the first six
months of 2002 compared to 4.04% for the first six months of 2001.

Interest Income

         Elsewhere  in this report is a table  comparing  the average  balances,
yields,  and rates for the interest rate sensitive segments of the Corporation's
balance  sheets for the six months ended June 30, 2002 and 2001. A discussion of
that table follows.


                                       12
<Page>

         Total  interest  income for the first six months of 2002 was $9,764,000
compared  with  $10,939,000  for the same period in 2001, a 10.7% or  $1,175,000
decrease.  The yield on average  earning  assets for the 2002  period was 6.31%,
decreased from 8.25% for the 2001 period.  Total average interest earning assets
for the 2002 period were  $309,676,000  compared  to  $265,312,000  for the 2001
period, an increase of 16.7% or $44,364,000.

         The loan portfolio  earned  $8,666,000 for the first six months of 2002
compared to $9,116,000 for the same period of 2001, a 4.9% or $450,000 decrease.
The yield decreased to 6.99% for the 2002 period from 9.03% for the 2001 period.
The average  size of the loan  portfolio  was  $247,983,000  for the 2002 period
compared  to  $201,885,000  for  the  2001  period,  an  increase  of  22.8%  or
$46,098,000.

         The taxable  investment  portfolio  earned  $916,000  for the first six
months in 2002  compared to  $1,250,000  for the same period in 2001, a 26.7% or
$334,000 decrease. The yield decreased to 4.55% in the 2002 period from 6.35% in
the 2001 period.  The average size of the portfolio was  $40,229,000 in the 2002
period  compared  to  $39,370,000  in the 2001  period,  an  increase of 2.2% or
$859,000.

         The  tax-exempt  investment  portfolio  earned $5,000 for the first six
months in 2002  compared  to  $13,000  for the same  period in 2001,  a 61.5% or
$8,000 decrease.  The yield (on a taxable equivalent basis) on the portfolio was
5.63%, an increase from 5.4%. The average size of the portfolio was $269,000 for
the 2002 period compared to $730,000 in the 2001 period,  a decrease of 63.2% or
$461,000.

         Interest  bearing deposits in other banks  contributed  $10,000 for the
first six months of 2002 compared to $106,000  during the prior year, a decrease
of 90.6% or $96,000. The yield on these deposits decreased to 1.53% for the 2002
period  from 4.79% in the 2001  period.  CBI  averaged  $1,311,000  in  interest
bearing  balances  in the first six months of 2002  compared to  $4,427,000  the
first six months of the prior year, a decrease of 70.4% or $3,116,000.

         Federal  funds  sold  earned  $167,000  the  first  six  months of 2002
compared to $454,000  the prior year,  a decrease of 63.2% or  $287,000.  Yields
decreased to 1.68% for the first six months in 2002 from 4.80% for the first six
months in 2001.  For the first six  months  of 2002 CBI  increased  its  average
volume in federal  funds sold to  $19,884,000  compared to  $18,900,000  for the
first six months of 2001, a 5.2% or $984,000 increase.

Interest Expense

         Interest  expense  for the  first  six  months  of 2002 was  $3,870,000
compared to the prior year's  $5,583,000,  a 30.7% or $1,713,000  decrease.  The
volume of interest bearing liabilities was $263,128,000 for the first six months
in 2002  compared to  $223,209,000  for the first six months of 2001, a 17.9% or
$39,919,000  increase.  The average rate paid for  interest-bearing  liabilities
during the 2002 period was 2.94%, decreased from 5.00% for the 2001 period.

         The cost of savings  accounts  was  $403,000 in the first six months in
2002  compared to $651,000 in the first six months of 2001,  a 38.1% or $248,000
decrease.  Average savings deposit  balances were  $46,577,000 for the first six
months in 2002  compared  to  $36,526,000  for the first six months of 2001,  an
increase of 27.5% or $10,051,000. The average rate paid on these funds decreased
to 1.73% from 3.56%.


                                       13
<Page>


         Interest bearing  transaction  accounts cost $171,000 for the first six
months in 2002  compared  to the prior  year's  $123,000,  an increase of 39% or
$48,000.  The volume of these deposits was  $42,158,000 for the first six months
in 2002  compared to  $23,063,000  for the first six months of 2001, an 82.8% or
$19,095,000  increase.  The  average  rate paid on these funds for the first six
months in 2002  decreased  to .81% from  1.07% for the first six months of 2001.
Most of the increase in volume was due to a local  government  checking  account
balance  of about $16  million  that was moved from one of the banks on June 28,
2002.

         Time deposits cost $2,546,000 for the first six months of 2002 compared
to $4,064,000 for the first six months of the prior year, a decrease of 37.4% or
$1,518,000.  The  volume  was  $142,278,000  for the  first  six  months in 2002
compared to $135,934,000  for the first six months of 2001, a 4.7% or $6,344,000
increase.  The average rate paid on these funds decreased to 3.58% for the first
six months in 2002 from 5.98% for the first six months in 2001.

         Short-term borrowings consist of federal funds purchased and securities
sold under  agreements to  repurchase.  This is a relatively  small and volatile
part of the  balance  sheet.  It cost  $44,000  for the first six months in 2002
compared  to $149,000  for the first six months of 2001,  a decrease of 70.5% or
$105,000.  The volume of these funds was  $4,603,000  in the first six months of
2002 compared to $7,391,000 in the first six months of 2001, a decrease of 37.7%
or  $2,788,000.  The average  rate paid on these funds  decreased  to 1.91% from
4.03%.

         Other  borrowings  consist of advances  from the Federal Home Loan Bank
and warehouse lines of credit for the mortgage  company.  They cost $706,000 for
the first six months in 2002  compared to  $596,000  for the first six months in
2001,  an increase of 18.5% or $110,000.  The  borrowings  averaged  $27,512,000
during the 2002 period  compared to  $20,295,000  for the prior year  period,  a
35.6% or $7,217,000 increase.  The average rate paid on these funds decreased to
5.13% from 5.87%.  Virtually all of this  increase in volume is associated  with
the warehouse lines of credit for the mortgage company.


Non-Interest Income

         Non-interest income for the first six months of 2002 grew to $3,437,000
compared to  $1,243,000  in the first six months of 2001,  a 177% or  $2,194,000
increase.  Of this  increase,  approximately  $1.9  million  resulted  from  the
mortgage company operations.

Non-Interest Expense

         For the first six months of 2002  non-interest  expenses  increased  to
$5,323,000  from  $3,489,000  for the  first  six  months  of  2001,  a 52.6% or
$1,834,000 increase. Of this increase, approximately $1.3 million was related to
the mortgage company  operations,  which accounts for most of the inceases noted
below.

         For the 2002  period,  personnel  costs  were  $3,383,000  compared  to
$2,102,000 for the 2001 period, an increase of 60.9% or $1,281,000;

         For the 2002 period,  premises and  equipment  expenses  were  $605,000
compared to $471,000 for the 2001 period, an increase of 28.5% or $134,000; and



                                       14
<Page>

         For the 2002 period,  other costs were $1,335,000  compared to $916,000
for the 2001 period, an increase of 45.7% or $419,000.



Income Taxes

         CBI provided  $1,314,000  for federal and state income taxes during the
first six months of 2002 compared to  $1,002,000  for the same period in 2001, a
31.1% or  $312,000  increase.  The  average  tax rate  for the 2002  period  was
approximately 36% and for the 2001 period it was approximately 35.4%.


RESULTS OF OPERATIONS FOR THE QUARTERS ENDED JUNE 30, 2002 AND 2001

Net Income

         For the quarter ended June 30, 2002, CBI earned a  consolidated  profit
of  $1,211,000,  compared  to $930,000  for the  comparable  period of 2001,  an
increase of 30.2% or  $281,000.  Basic  earnings per share were $.37 in the 2002
period,  compared  to  $.29  for the  2001  period.  The  changes  in the  items
comprising  net  interest  income,  which are  discussed  below,  resulted  from
essentially the same factors  discussed above regarding the results of operation
for the six months ended June 30, 2002.

Net interest income

         Net interest  income  before  provision for loan losses for the quarter
ended June 30, 2002, increased to $3,077,000 compared to $2,652,000 for the same
period  in  2001,  an  increase  of 16% or  $425,000.  For the same  period  the
provision for loan losses was $189,000 compared to $135,000 for the 2001 period,
an increase of 40% or $54,000.

Interest Income

         Total  interest  income  for the  second  quarter  2002 was  $4,941,000
compared  with  $5,389,000  for the same  period  in 2001,  an 8.3% or  $448,000
decrease.

         The loan  portfolio  earned  $4,342,000  for the  second  quarter  2002
compared to $4,525,000 for the same period of 2001, a 4% or $183,000 decrease.

         The investment  portfolio  earned  $483,000 for the second quarter 2002
compared to $469,000 for the 2001 period, a 3% or $14,000 increase.

         Interest  bearing  deposits in other banks  contributed  $4,000 for the
second  quarter  2002  compared to $78,000  during the prior year, a decrease of
94.9% or $74,000.

         Federal funds sold earned  $80,000 the second  quarter of 2002 compared
to $284,000 the prior year, a decrease of 71.8% or $204,000.


                                       15
<Page>


Interest expense

         Interest expense for the second quarter of 2002 was $1,864,000 compared
to the prior year's $2,737,000, a 31.9% or $873,000 decrease.

Non-interest income and expense

         Non-interest  income for the 2002  period was  $1,750,000  compared  to
$692,000  for the  2001  period,  a 153% or  $1,058,000  increase.  Non-interest
expense was  $2,745,000  compared to $1,777,000,  a 54.5% or $968,000  increase.
Both changes were mostly the result of mortgage company operations.


CHANGES IN FINANCIAL POSITION

Investment portfolio

         The  investment  portfolio is comprised of held to maturity  securities
and available for sale securities. CBI and its banks usually purchase short-term
issues  (ten  years  or  less)  of U. S  Treasury  and U. S.  Government  agency
securities  for  investment  purposes.  At June 30,  2002,  the held to maturity
portfolio totaled $500,000,  unchanged from December 31, 2001. At June 30, 2002,
the available for sale portfolio totaled $40,450,000  compared to $43,207,000 at
December  31,  2001,  a decrease  of 6.4% or  $2,757,000.  The  following  chart
summarizes the investment portfolios at June 30, 2002, and December 31, 2001.

<Table>
<Caption>
                                                                                              June 30, 2002
                                                                          Held to maturity                    Available for sale
                                                                   Amortized cost     Fair value        Amortized cost    Fair value
                                                                   --------------     ----------        --------------    ----------
                                                                                         (dollars in thousands)
<S>                                                                <C>                 <C>                <C>                <C>
U. S. Government and agencies .........................            $   500             $   492            $38,017            $38,267
Tax exempt securities .................................                  -                   -                194                201
Other equity securities ...............................                  -                   -              1,982              1,982
                                                                   -------             -------            -------            -------
Total .................................................            $   500             $   492            $40,193            $40,450
                                                                   =======             =======            =======            =======

Unrealized gain (loss) ................................            $    (8)                               $   257
                                                                   =======                                =======
</Table>

<Table>
<Caption>
                                                                                            December 31, 2001
                                                                          Held to maturity                    Available for sale
                                                                   Amortized cost     Fair value        Amortized cost    Fair value
                                                                   --------------     ----------        --------------    ----------
                                                                                         (dollars in thousands)
<S>                                                                  <C>              <C>                 <C>                <C>
U. S. Government and agencies ...........................            $ 500            $   500             $40,437            $40,415
Tax exempt securities ...................................                -                  -                 802                811
Other equity securities .................................                -                  -               1,981              1,981
                                                                     -----            -------             -------            -------
Total ...................................................            $ 500            $   500             $43,220            $43,207
                                                                     =====            =======             =======            =======

Unrealized (loss) .......................................            $   -                                $   (13)
                                                                     =====                                =======
</Table>




                                       16
<Page>


Loan portfolio

         The loan portfolio is primarily  consumer and small business  oriented.
At June 30, 2002 the loan portfolio was $244,993,000 compared to $229,905,000 at
December  31,  2001,  a  6.6%  or  $15,088,000  increase.  The  following  chart
summarizes the loan portfolio at June 30, 2002 and December 31, 2001.

                                         Jun. 30, 2002     Dec. 31, 2001
                                         -------------     -------------
                                             (dollars in thousands)
Real estate .........................       $153,261          $146,559
Commercial ..........................         64,753            56,515
Loans to individuals ................         26,979            26,831
                                            --------          --------
Total ...............................       $244,993          $229,905
                                            ========          ========



Past Due and Non-Performing Assets and the Allowance for Loan Losses

         CBI closely  monitors past due loans and loans that are in  non-accrual
status  and  other  real  estate  owned.  Below  is a  summary  of past  due and
non-performing assets at June 30, 2002 and December 31, 2001.

                                                Jun. 30, 2002     Dec. 31, 2001
                                                -------------     -------------
                                                      (dollars in thousands)
Past due 90 days + accruing loans ..........          $266           $ 17
Non-accrual loans ..........................          $824           $281
Impaired loans (included in nonaccrual) ....          $824           $238
Other real estate owned ....................          $  -           $267

         Management  considers the past due and non-accrual  amounts at June 30,
2002 to be reasonable in relation to the size of the portfolio and manageable in
the normal course of business.  The increase in non-accrual assets is associated
with a  small  number  of  loans  and  is not  indicative,  in  the  opinion  of
management, of any trend.

         CBI had no restructured loans during any of the above listed periods.

Allowance for Loan Losses

         The Corporation  operates three independent  community banks in central
South  Carolina.  Under the  provisions  of the National  Bank Act each board of
directors is responsible  for  determining  the adequacy of its Bank's loan loss
allowance.  In addition,  each Bank is supervised and regularly  examined by the
Office of the Comptroller of the Currency of the U. S. Treasury Department. As a
normal part of a safety and soundness examination, the OCC examiners will assess
and comment on the adequacy of a national bank's allowance for loan losses.  The
allowance presented in this discussion is on an aggregated basis.



                                       17
<Page>

         The nature of community  banking is such that the loan  portfolios will
be predominantly comprised of small and medium size business and consumer loans.
As community banks, there is a natural geographic  concentration of loans within
the Banks' respective  cities or counties.  Management at each Bank monitors the
loan  concentrations  and loan portfolio  quality on an ongoing basis including,
but not limited to: quarterly analysis of loan concentrations, monthly reporting
of past dues,  non-accruals,  and watch loans,  and quarterly  reporting of loan
charge-offs and recoveries. These efforts focus on historical experience and are
bolstered by quarterly analysis of local and state economic conditions, which is
part of the Banks'  assessment  of the  adequacy  of their  allowances  for loan
losses.

         Management  reviews  its  allowance  for loan  losses  in  three  broad
categories:  commercial,  real estate and installment loans. However, management
does not  believe it would be useful to maintain a separate  allowance  for each
category. Instead management assigns an estimated risk percentage factor to each
category in the computation of the overall allowance. In general terms, the real
estate loan portfolio is subject to the least risk,  followed by the installment
loan  portfolio,  which in turn is followed  by the  commercial  portfolio.  The
Banks'  internal  and  external  loan  review  programs  will  from time to time
identify  loans that are subject to specific  weaknesses  and such loans will be
reviewed for a specific loan loss allowance.

         Based on the current levels of non-performing  and other problem loans,
management  believes that loan charge-offs in 2002 will at least approximate the
2001 levels as such loans progress  through the collection  process.  Management
believes that the  allowance for loan losses,  as of June 30, 2002 is sufficient
to absorb the  expected  charge-offs  and provide  adequately  for the  inherent
losses that remain in the loan  portfolio.  Management  will continue to closely
monitor the levels of non-performing and potential problem loans and address the
weaknesses  in these  credits to enhance  the amount of ultimate  collection  or
recovery  of these  assets.  Management  considers  the  levels  and  trends  in
non-performing  and past due loans in determining how historical loan loss rates
are adjusted.

         The aggregate  allowance for loan losses of the Banks and the aggregate
activity with respect to those allowances are summarized in the following table.

<Table>
<Caption>
                                                                           Six months ended                         Six months ended
                                                                             June 30, 2002          Dec. 31, 2001    June 30, 2001
                                                                             -------------          -------------    -------------
                                                                                               (dollars in thousands)
<S>                                                                              <C>                  <C>                  <C>
Allowance at beginning of period ....................................            $ 2,830              $ 2,424              $ 2,424
Provision expense ...................................................                358                  678                  277
Net charge offs .....................................................               (328)                (272)                 (66)
                                                                                 -------              -------              -------
Allowance at end of period ..........................................            $ 2,860              $ 2,830              $ 2,635
                                                                                 =======              =======              =======
Allowance as a percent of outstanding loans .........................               1.17%                1.23%                1.27%
</Table>

         In reviewing  the adequacy of the  allowance for loan losses at the end
of  each  period,  management  of  each  bank  considers  historical  loan  loss
experience,   current  economic   conditions,   loans  outstanding,   trends  in
non-performing  and  delinquent  loans,  and the quality of collateral  securing
problem  loans.  After  charging off all known  losses,  management of each bank
considers the allowance adequate to provide for estimated losses inherent in the
loan portfolio at June 30, 2002.


                                       18
<Page>

Goodwill

         CBI has adopted FASB No. 142, Goodwill and Other Intangible  Assets, as
of January 1,  2002.  As of June 30,  2002 the  balance  in  goodwill,  our only
intangible  asset,  totaled  $921,000,  unchanged  from  December 31, 2001.  The
Company will evaluate the goodwill for impairment later in 2002.

         The balance in goodwill was acquired in connection with the purchase of
Community Resource Mortgage Inc., which was consummated in November 2001.

Deposits

         Deposits were $260,808,000 at June 30, 2002 compared to $255,433,000 at
December 31, 2001, an increase of 2.1% or $5,375,000.

         Time deposits  greater than $100,000 were  $61,677,000 at June 30, 2002
compared to $51,374,000 at December 31, 2001, an increase of 20% or $10,303,000.

Liquidity

         Liquidity is the ability to meet current and future obligations through
liquidation  or maturity of existing  assets or the  acquisition  of  additional
liabilities.  Adequate  liquidity  is  necessary  to meet  the  requirements  of
customers for loans and deposit  withdrawals in a timely and economical  manner.
The most manageable  sources of liquidity are composed of liabilities,  with the
primary  focus of  liquidity  management  being the ability to attract  deposits
within the Orangeburg National Bank, Sumter National Bank, and Florence National
Bank service areas.  Core deposits (total deposits less  certificates of deposit
of $100,000 or more) provide a relatively  stable funding base.  Certificates of
deposit of $100,000 or more are generally more sensitive to changes in rates, so
they must be  monitored  carefully.  Asset  liquidity  is  provided  by  several
sources,  including amounts due from banks,  federal funds sold, and investments
available for sale.

         CBI and its banks maintain an available for sale and a held to maturity
investment  portfolio.  While all these investment securities are purchased with
the intent to be held to maturity, such securities are marketable and occasional
sales may occur prior to maturity as part of the process of asset/liability  and
liquidity  management.  Such sales will generally be from the available for sale
portfolio.  Management deliberately maintains a short-term maturity schedule for
its  investments so that there is a continuing  stream of maturing  investments.
CBI intends to maintain a short-term  investment  portfolio in order to continue
to be  able  to  supply  liquidity  to  its  loan  portfolio  and  for  customer
withdrawals.

         CBI has substantially more liabilities  (mostly deposits,  which may be
withdrawn) which mature in the next 12 months than it has assets maturing in the
same period.  However, based on its historical  experience,  and that of similar
financial  institutions,  CBI believes that it is unlikely that so many deposits
would be withdrawn,  without being replaced by other deposits, that CBI would be
unable to meet its liquidity needs with the proceeds of maturing assets.

         CBI through its banking subsidiaries also maintains federal funds lines
of credit with correspondent  banks, and is able to borrow from the Federal Home
Loan Bank and from the Federal Reserve's discount window.



                                       19
<Page>

         CBI through  its banking  subsidiaries  has a  demonstrated  ability to
attract deposits from its markets.  Deposits have grown from $30 million in 1989
to over $260  million  in 2002.  This base of  deposits  is the major  source of
operating liquidity.

         CBI's long term liquidity  needs are expected to be primarily  affected
by the maturing of long-term  certificates of deposit.  At June 30, 2002 CBI had
approximately  $25.7  million and $11.5 million in  certificates  of deposit and
other interest bearing  liabilities  maturing in one to five years and over five
years, respectively. CBI's assets maturing or repricing in the same periods were
$138.1 million and $28.2 million, respectively. CBI expects to be able to manage
its current balance sheet structure without  experiencing any material liquidity
problems.

         In the opinion of  management,  CBI's current and  projected  liquidity
position is adequate.


Capital resources

         As  summarized  in the table  below,  CBI  maintains  a strong  capital
position.
<Table>
<Caption>
                                                                                                                    Minimum required
                                                                                                                      for capital
                                                                                 Jun. 30, 2002      Dec. 31, 2001       adequacy
                                                                                 -------------      -------------       --------
<S>                                                                                  <C>               <C>              <C>
Tier 1 capital to average total assets ............................................   8.50%             8.20%           4.00%
Tier 1 capital to risk weighted assets ............................................  11.49%            11.10%           4.00%
Total capital to risk weighted assets .............................................  12.63%            12.30%           6.00%
</Table>

         In the opinion of management,  the Corporation's  current and projected
capital positions meet all applicable requirements and are adequate.

Dividends

         CBI  declared  and paid a  quarterly  cash  dividend of eight cents per
share during both the first and second quarters of 2002. The total cost of these
dividends was $529,000.


Subsequent events

         In late  November  2001 CBI  entered  into an  agreement  to acquire by
merger Ridgeway  Bancshares  Inc., the holding company for the Bank of Ridgeway.
The  agreement  provided  for CBI to issue  1,000,000  shares  of its  stock and
$4,000,000  cash in exchange for 100% of the stock of Ridgeway.  The transaction
required  approval by two-thirds of the shareholders of both companies,  as well
as various  regulators.  Shareholder  meetings for both  companies  were held in
April 2002 and the shareholders of both companies approved the transaction. This
transaction  was  consummated  on July 1, 2002. A Form 8-K was filed on July 15,
2002 to describe this transaction.



                                       20
<Page>


Item 3. Quantitative and Qualitative Disclosures about Market Risk

         Market risk is the risk of loss from adverse  changes in market  prices
and rates. The Corporation's  market risk arises  principally from interest rate
risk  inherent in its  lending,  deposit and  borrowing  activities.  Management
actively  monitors and manages its  interest  rate risk  exposure.  Although the
Corporation  manages other risks,  such as credit  quality and liquidity risk in
the normal course of business, management considers interest rate risk to be its
most  significant  market  risk and the risk  that  could  potentially  have the
largest material effect on the Corporation's  financial condition and results of
operations.  Other types of market risks such as foreign currency  exchange risk
and commodity price risk do not arise in the normal course of community  banking
activities.

         Achieving  consistent growth in net interest income is the primary goal
of the  Corporation's  asset/liability  function.  The  Corporation  attempts to
control the mix and maturities of assets and  liabilities to achieve  consistent
growth in net interest  income despite  changes in market  interest  rates.  The
Corporation seeks to accomplish this goal while maintaining  adequate  liquidity
and capital.  Management believes that the Corporation's  asset/liability mix is
sufficiently  balanced  so that the effect of  interest  rates  moving in either
direction is not expected to be significant over time.

         The Corporation's  Asset/Liability Committee uses a simulation model to
assist in  achieving  consistent  growth in net interest  income while  managing
interest rate risk.  The model takes into account  interest rate changes as well
as changes in the mix and volume of assets and liabilities.  The model simulates
the  Corporation's  balance sheet and income  statement under several  different
rate  scenarios.  The model's inputs (such as interest rates and levels of loans
and  deposits)  are  updated  on a  quarterly  basis in order to obtain the most
accurate  projection  possible.  The  projection  presents  information  over  a
twelve-month  period. It reports a base case in which interest rates remain flat
and reports  variations  that occur when rates increase and decrease 100 and 200
basis  points.  According  to the model as of June 30, 2002 the  Corporation  is
positioned  so that net interest  income would be expected to increase  $210,000
and net income would be expected to increase  $129,000 in the next twelve months
if interest rates rise 100 basis points.  Conversely,  net interest income would
be  expected  to decline  $210,000  and net income  would be expected to decline
$129,000 in the next twelve  months if interest  rates decline 100 basis points.
Computation of  prospective  effects of  hypothetical  interest rate changes are
based on numerous  assumptions,  including  relative  levels of market  interest
rates and loan prepayment, and should not be relied upon as indicative of actual
results.   Further,   the  computations  do  not  contemplate  any  actions  the
Corporation  could  undertake  in  response  to changes in  interest  rates.  In
addition,  market  interest rates are at long term lows and the probability of a
rate decrease is relatively small.

         As of June 30, 2002 there was no  significant  change from the interest
rate  sensitivity  analysis for the various changes in interest rates calculated
as of December 31, 2001. The foregoing disclosures related to the market risk of
the Corporation  should be read in connection with  Management's  Discussion and
Analysis of Financial  Position and Results of  Operations  included in the 2001
Annual Report on Form 10-K.


                                       21
<Page>


Part II--Other Information

Item 4.  Submission of Matters to a Vote of Security Holders.

CBI  held a  Special  Shareholders  Meeting  on  April 8,  2002 to  approve  the
agreement  and plan of  merger  dated as of  November  20,  2001 by and  between
Ridgeway Bancshares Inc. and Community Bankshares Inc.

The vote tally was as follows:
<Table>
<Caption>
                                  Total number                      Voting
                                   of shares                    against or to                   Present at
                                  eligible to                      withhold                    meeting and
                                      vote        Voting for      authority      Abstaining     not voting
                                      ----        ----------      ---------      ----------     ----------

<S>                                <C>             <C>              <C>               <C>            <C>
     Merger with Ridgeway          3,299,281       2,550,233        47,360            0              0
     Bancshares
</Table>

CBI was required to obtain approval of two-thirds of its  outstanding  shares in
order to complete the transaction.  Total shares voting in favor were 77.3%. The
shareholders of Ridgeway Bancshares Inc. also approved the transaction,  and the
transaction was consummated on July 1, 2002.

CBI held an Annual Meeting of Shareholders on May 8, 2002.

The following persons were elected to the Board for terms of three years:

Martha Rose C. Carson,  J. M. Guthrie,  A. Wade Douroux,  Phil P.  Leventis,  W.
Reynolds Williams, Michael A. Wolfe.

The other item approved was the  ratification  of J. W. Hunt and Co.,  Certified
Public Accountants,  as outside auditors for CBI for the year ended December 31,
2002.

The vote tally was as follows:

<Table>
<Caption>
                                  Total number                      Voting
                                   of shares                    against or to                   Present at
                                  eligible to                      withhold                    meeting and
                                      vote        Voting for      authority      Abstaining     not voting
                                      ----        ----------      ---------      ----------     ----------
Election of directors
<S>                                <C>             <C>              <C>              <C>            <C>
     Martha Rose C. Carson         3,299,281       2,284,286         33,541            0            0
     J. M. Guthrie                 3,299,281       2,279,555         38,272            0            0
     A. Wade Douroux               3,299,281       2,313,124          4,703            0            0
     Phil P. Leventis              3,299,281       2,311,164          6,653            0            0
     Wm. Reynolds Williams         3,299,281       2,314,064          3,763            0            0
     Michael A. Wolfe              3,299,281       2,312,709          5,118            0            0

Ratification of J. W. Hunt         3,299,281       2,301,929         15,370          528            0
</Table>



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<Page>

Item 6.  Exhibits and Reports on Form 8-K

(a) Exhibit Index

Exhibit No.(from item Description 601 of S-K) None.

b) Reports on Form 8-K.  CBI filed a Form 8-K on July 15, 2002 to  announce  the
consummation of its merger with Ridgeway Bancshares Inc.


Signatures

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

                                                         DATED: August 13,  2002
COMMUNITY BANKSHARES, INC.

By:  s/  E. J. Ayers, Jr.,
    -------------------------------------------
         E. J. Ayers, Jr.,
         Chief Executive Officer

By:  s/  William W. Traynham
     ------------------------------------------
         William W. Traynham
         President and Chief Financial Officer
         (Principal Accounting Officer)














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