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 March 31, 2005      Commission File No. 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 No.)
  incorporation or organization)


                              791 Broughton Street
                        Orangeburg, South Carolina 29115
--------------------------------------------------------------------------------
               (Address of principal executive offices, 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 [ ]


         Indicate by check mark whether the registrant is an  accelerated  filer
(as defined in Rule 12b-2 of the Exchange Act).

         Yes [ ] No [X]


         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practicable date: Common Stock, no par
or stated value, 4,404,303 shares outstanding on May 3, 2005.



<PAGE>


                           COMMUNITY BANKSHARES, INC.

                                    FORM 10-Q

                                      Index

                                                                            Page
PART I -    FINANCIAL INFORMATION

Item 1.     Financial Statements

            Consolidated Balance Sheets .....................................  3
            Consolidated Statements of Income ...............................  4
            Consolidated Statements of Changes in Shareholders' Equity ......  5
            Consolidated Statements of Cash Flows ...........................  6
            Notes to Unaudited Consolidated Financial Statements ............  7

Item 2.     Management's Discussion and Analysis of
              Financial Condition and Results of Operations ................   9

Item 3.     Quantitative and Qualitative Disclosures About Market Risk .....  18

Item 4.     Controls and Procedures ........................................  19

PART II -   OTHER INFORMATION

Item 6.     Exhibits .......................................................  20

SIGNATURES .................................................................  21




                                       2
<PAGE>


                         PART I - FINANCIAL INFORMATION

Item 1. - Financial Statements

COMMUNITY BANKSHARES, INC.
Consolidated Balance Sheets
<TABLE>
<CAPTION>
                                                                                                      (Unaudited)
                                                                                                        March 31,       December 31,
                                                                                                          2005             2004
                                                                                                          -----            ----
                                                                                                         (Dollars in thousands)
Assets
<S>                                                                                                     <C>                <C>
     Cash and due from banks .................................................................          $ 16,866           $ 14,397
     Federal funds sold ......................................................................            11,865             12,571
                                                                                                        --------           --------
            Total cash and cash equivalents ..................................................            28,731             26,968
     Interest-bearing deposits with other banks ..............................................               543                852
     Securities available-for-sale ...........................................................            51,894             55,471
     Securities held-to-maturity (estimated fair value $1,875 for 2005
          and $1,907 for 2004) ...............................................................             1,925              1,925
     Other investments .......................................................................             2,858              2,642
     Loans held for sale .....................................................................            16,116             15,090
     Loans receivable ........................................................................           406,049            393,649
         Less, allowance for loan losses .....................................................            (4,722)            (4,347)
                                                                                                        --------           --------
            Net loans ........................................................................           401,327            389,302
     Premises and equipment - net ............................................................             7,728              7,739
     Accrued interest receivable .............................................................             2,484              2,419
     Net deferred income tax assets ..........................................................               831                599
     Goodwill ................................................................................             4,321              4,321
     Core deposit intangible assets ..........................................................             3,022              3,083
     Prepaid expenses and other assets .......................................................             1,289              1,966
                                                                                                        --------           --------

            Total assets .....................................................................          $523,069           $512,377
                                                                                                        ========           ========

Liabilities
     Deposits
         Non-interest bearing ................................................................          $ 65,013            $67,046
         Interest-bearing ....................................................................           365,053            356,412
                                                                                                        --------           --------
            Total deposits ...................................................................           430,066            423,458
     Short-term borrowings ...................................................................             6,830              6,662
     Long-term debt ..........................................................................            33,571             30,573
     Accrued interest payable ................................................................               865                691
     Accrued expenses and other liabilities ..................................................             1,003                966
                                                                                                        --------           --------
            Total liabilities ................................................................           472,335            462,350
                                                                                                        --------           --------

Shareholders' equity
     Common stock - no par value; 12,000,000 shares authorized; issued and
         outstanding - 4,403,016 for 2005 and
         4,390,784 for 2004 ..................................................................            30,182             30,042
     Retained earnings .......................................................................            20,996             20,075
     Accumulated other comprehensive income (loss) ...........................................              (444)               (90)
                                                                                                        --------           --------
            Total shareholders' equity .......................................................            50,734             50,027
                                                                                                        --------           --------

            Total liabilities and shareholders' equity .......................................          $523,069           $512,377
                                                                                                        ========           ========
</TABLE>

See accompanying notes to unaudited consolidated financial statements.



                                       3
<PAGE>

COMMUNITY BANKSHARES, INC.
Consolidated Statements of Income
<TABLE>
<CAPTION>
                                                               (Unaudited)
                                                           Three Months Ended
                                                                March 31,
                                                                ---------
                                                            2005         2004
                                                            -----        ----
                                                          (Dollars in thousands,
                                                           except per share)
Interest and dividend income
<S>                                                        <C>          <C>
     Loans, including fees ...........................     $ 6,614      $ 5,331
     Interest-bearing deposits with other banks ......           8            4
     Debt securities .................................         437          496
     Dividends .......................................          24           19
     Federal funds sold ..............................          68           58
                                                           -------      -------
         Total interest and dividend income ..........       7,151        5,908
                                                           -------      -------

Interest expense
     Deposits
     Time deposits $100M and over ....................         527          313
     Other deposits ..................................       1,208          919
                                                           -------      -------
         Total interest expense on deposits ..........       1,735        1,232
     Short-term borrowings ...........................          43          105
     Long-term debt ..................................         438          303
                                                           -------      -------
         Total interest expense ......................       2,216        1,640
                                                           -------      -------

Net interest income ..................................       4,935        4,268
Provision for loan losses ............................         450          233
                                                           -------      -------
Net interest income after provision ..................       4,485        4,035
                                                           -------      -------

Noninterest income
     Service charges on deposit accounts .............         762          845
     Mortgage brokerage income .......................         794          749
     Net securities gains or (losses) ................         (10)          (4)
     Other ...........................................         221          256
                                                           -------      -------
         Total noninterest income ....................       1,767        1,846
                                                           -------      -------

Noninterest expenses
     Salaries and employee benefits ..................       2,278        2,111
     Premises and equipment ..........................         535          491
     Other ...........................................       1,306        1,131
                                                           -------      -------
         Total noninterest expenses ..................       4,119        3,733
                                                           -------      -------

Income before income taxes ...........................       2,133        2,148
Income tax expense ...................................         773          763
                                                           -------      -------
Net income ...........................................     $ 1,360      $ 1,385
                                                           =======      =======

Per share
     Net income ......................................     $  0.31      $  0.32
     Net income - diluted ............................        0.30         0.31
     Cash dividends declared .........................        0.10         0.10
</TABLE>



See accompanying notes to unaudited consolidated financial statements.



                                       4
<PAGE>



COMMUNITY BANKSHARES, INC.
Consolidated Statements of Changes in Shareholders' Equity

<TABLE>
<CAPTION>
                                                                          (Unaudited)

                                                                            Common Stock                    Accumulated
                                                                            ------------                       Other
                                                                     Number of                  Retained   Comprehensive
                                                                      Shares       Amount       Earnings    Income (Loss)   Total
                                                                      ------       ------       --------    -------------   -----
                                                                                 (Dollars in thousands, except per share)

<S>                                                                 <C>          <C>          <C>           <C>           <C>
Balance, January 1, 2004 .......................................    4,331,460    $  29,402    $  18,610     $      58     $  48,070
                                                                                                                          ---------
Comprehensive income
    Net income .................................................            -            -        1,385             -         1,385
                                                                                                                          ---------
    Unrealized holding gains and losses
      on available-for-sale securities arising
      during the period, net of income taxes of $171 ...........            -            -            -           304           304
    Reclassification adjustment for losses (gains)
      realized in income, net of income taxes of $1 ............            -            -            -             3             3
                                                                                                                          ---------
    Total other comprehensive income ...........................            -            -            -             -           307
                                                                                                                          ---------
    Total comprehensive income .................................            -            -            -             -         1,692
                                                                                                                          ---------
Exercise of employee stock options .............................        4,652           45            -             -            45
Cash dividends declared, $.10 per share ........................            -            -         (433)            -          (433)
                                                                    ---------    ---------    ---------     ---------     ---------
Balance, March 31, 2004 ........................................    4,336,112    $  29,447    $  19,562     $     365     $  49,374
                                                                    =========    =========    =========     =========     =========

Balance, January 1, 2005 .......................................    4,390,784    $  30,042    $  20,075     $     (90)    $  50,027
                                                                                                                          ---------
Comprehensive income
    Net income .................................................            -            -        1,360             -         1,360
                                                                                                                          ---------
    Unrealized holding gains and losses
      on available-for-sale securities arising
      during the period, net of income taxes of $203 ...........            -            -            -          (361)         (361)
    Reclassification adjustment for losses (gains)
      realized in income, net of income taxes of $3 ............            -            -            -             7             7
                                                                                                                          ---------
    Total other comprehensive income (loss) ....................            -            -            -             -          (354)
                                                                                                                          ---------
    Total comprehensive income .................................            -            -            -             -         1,006
                                                                                                                          ---------
Exercise of employee stock options .............................       12,232          140            -             -           140
Cash dividends declared, $.10 per share ........................            -            -         (439)            -          (439)
                                                                    ---------    ---------    ---------     ---------     ---------
Balance, March 31, 2005 ........................................    4,403,016    $  30,182    $  20,996     $    (444)    $  50,734
                                                                    =========    =========    =========     =========     =========
</TABLE>











See accompanying notes to unaudited consolidated financial statements.




                                       5
<PAGE>

COMMUNITY BANKSHARES, INC.
Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
                                                                                                                (Unaudited)
                                                                                                           Three Months Ended
                                                                                                                 March 31,
                                                                                                                 ---------
                                                                                                           2005              2004
                                                                                                           -----             ----
                                                                                                            (Dollars in thousands)
Operating activities
<S>                                                                                                    <C>                 <C>
     Net income ............................................................................           $  1,360            $  1,385
     Adjustments to reconcile net income to net
         cash provided (used) by operating activities
            Depreciation and amortization ..................................................                286                 283
            Net amortization of securities .................................................                 32                  71
            Provision for loan losses ......................................................                450                 233
            Net securities losses ..........................................................                 10                   4
            Proceeds of sales of loans held for sale .......................................             43,781              37,663
            Originations of loans held for sale ............................................            (44,807)            (41,752)
            (Increase) decrease in accrued interest receivable .............................                (65)                 67
            Decrease (increase) in other assets ............................................                652                (633)
            Gains on sales of other real estate ............................................                  -                  (9)
            Increase in accrued interest payable ...........................................                174                  90
            Increase in other liabilities ..................................................                 30                 238
                                                                                                       --------            --------
                Net cash provided (used) by operating activities ...........................              1,903              (2,360)
                                                                                                       --------            --------

Investing activities
     Net decrease in interest-bearing deposits with other banks ............................                309                  51
     Purchases of available-for-sale securities ............................................             (3,500)            (10,739)
     Maturities, calls and paydowns of available-for-sale securities .......................              2,069              11,979
     Proceeds of sales of available-for-sale securities ....................................              4,412               7,927
     Purchases of other investments ........................................................               (216)                  -
     Net increase in loans made to customers ...............................................            (12,475)             (7,084)
     Purchases of premises and equipment ...................................................               (214)               (133)
     Proceeds from sales of other real estate ..............................................                  -                  59
                                                                                                       --------            --------
                Net cash (used) provided by investing activities ...........................             (9,615)              2,060
                                                                                                       --------            --------

Financing activities
     Net increase (decrease) in deposits ...................................................              6,608             (11,099)
     Net increase (decrease) in short-term borrowings ......................................                168              (4,950)
     Proceeds from issuing long-term debt ..................................................              2,998              10,310
     Exercise of employee stock options ....................................................                140                  45
     Cash dividends paid ...................................................................               (439)               (433)
                                                                                                       --------            --------
                Net cash provided (used) by financing activities ...........................              9,475              (6,127)
                                                                                                       --------            --------
Increase (decrease) in cash and cash equivalents ...........................................              1,763              (6,427)
Cash and cash equivalents, beginning of period .............................................             26,968              41,875
                                                                                                       --------            --------
Cash and cash equivalents, end of period ...................................................           $ 28,731            $ 35,448
                                                                                                       ========            ========

Supplemental disclosures of cash flow information
     Cash payments for interest ............................................................           $  2,042            $  1,550
                                                                                                       ========            ========
     Cash payments for income taxes ........................................................           $      -            $    179
                                                                                                       ========            ========

Supplemental disclosures of non-cash investing activities
     Transfers of loans receivable to other real estate ....................................           $      -            $     11
                                                                                                       ========            ========
</TABLE>

See accompanying notes to unaudited consolidated financial statements.



                                       6
<PAGE>

Notes to Unaudited Consolidated Financial Statements

Accounting  Principles - A summary of  significant  accounting  policies and the
audited  financial  statements  for 2004 are included in  Community  Bankshares,
Inc.'s (the  "Company" or "CBI")  Annual  Report on Form 10-K for the year ended
December 31, 2004.

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 2004 Annual Report on Form 10-K.

Nonperforming  Loans - As of March 31, 2005, there were $5,059,000 in nonaccrual
loans  and  $353,000  in  loans 90 or more  days  past  due and  still  accruing
interest.

Earnings Per Share - Basic earnings per share is computed by dividing net income
applicable  to common  shares by the weighted  average  number of common  shares
outstanding.  Diluted earnings per share is computed by dividing  applicable net
income by the weighted  average  number of shares  outstanding  and any dilutive
potential  common  shares and  dilutive  stock  options.  It is assumed that all
dilutive  stock  options are  exercised at the beginning of each period and that
the proceeds are used to purchase  shares of the  Company's  common stock at the
average market price during the period.  Net income per share and net income per
share, assuming dilution, were computed as follows:

                                                               (Unaudited)
                                                           Three Months Ended
                                                                March 31,
                                                                ---------
                                                          2005            2004
                                                          ----            ----
                                                       (Dollars in thousands,
                                                       except per share amounts)

Net income per share, basic
  Numerator - net income ...........................   $    1,360     $    1,385
                                                       ==========     ==========
  Denominator
    Weighted average common shares
     issued and outstanding ........................    4,394,078      4,333,718
                                                        =========      =========

          Net income per share, basic ..............   $      .31     $      .32
                                                       ==========     ==========

Net income per share, assuming dilution
  Numerator - net income ...........................   $    1,360     $    1,385
                                                       ==========     ==========
  Denominator
    Weighted average common shares
     issued and outstanding ........................    4,394,078      4,333,718
  Effect of dilutive stock options .................      102,720        142,560
                                                       ----------     ----------
          Total shares .............................    4,496,798      4,476,278
                                                       ==========     ==========
          Net income per share, assuming dilution ..   $      .30     $      .31
                                                       ==========     ==========


Stock Based  Compensation  - On April 14,  2005,  the  Securities  and  Exchange
Commission  adopted a rule  amending  the  compliance  date for the  adoption of
Statement of Accounting Standards No. 123(R)



                                       7
<PAGE>


until the first interim or annual  reporting  period of the  registrant's  first
fiscal  year  beginning  on or after June 15,  2005.  The Company has elected to
continue  using the  methodology of Accounting  Principles  Board Opinion No. 25
("APB No.  25"),  "Accounting  for Stock  Issued to  Employees,"  to account for
compensation expenses related to stock-based compensation.  Options issued under
the  Company's  plans  have  no  intrinsic  value  at  the  grant  date  and  no
compensation  cost is  recognized in  accordance  with APB No. 25.  Statement of
Financial  Accounting  Standards  No.  123  ("SFAS No.  123"),  "Accounting  for
Stock-Based Compensation," requires entities to provide pro forma disclosures of
net  income,  and  earnings  per  share,  as if the fair value  based  method of
accounting  promulgated  by that  standard  had been  applied.  The  Company has
adopted and intends to continue using the disclosure provisions of SFAS No. 123,
as amended,  until the  required  adoption of the  provisions  of SFAS 123(R) on
January 1, 2006. Had compensation  cost for the Company's stock option plan been
determined  based on the fair value as of the grant  dates for awards  under the
plans  consistent with the method  prescribed by SFAS No. 123, the Company's net
income and earnings per share would have been  adjusted to the pro forma amounts
indicated below:

                                                              (Unaudited)
                                                            Three Months Ended
                                                                March 31,
                                                                ---------
                                                            2005           2004
                                                            ----           ----
                                                        (Dollars in thousands,
                                                      except per share amounts)

Net income, as reported ............................     $   1,360     $   1,385
Deduct:  Total stock-based employee
      compensation expense determined under
      fair value based method for all awards,
      net of any related tax effects ...............            83           214
                                                         ---------     ---------
Pro forma net income ...............................     $   1,277     $   1,171
                                                         =========     =========

Net income per share, basic
      As reported ..................................     $    0.31     $    0.32
      Pro forma ....................................          0.29          0.27
Net income per share, assuming dilution
      As reported ..................................     $    0.30     $    0.31
      Pro forma ....................................          0.28          0.26

Variable  Interest  Entities - On March 8, 2004, CBI sponsored the creation of a
Delaware trust, SCB Capital Trust I (the "Trust"),  and is the sole owner of the
common  securities  issued by the Trust.  On March 10,  2004,  the Trust  issued
$10,000,000 in floating rate capital securities.  The proceeds of this issuance,
and the amount of CBI's  capital  investment,  were used to acquire  $10,310,000
principal amount of CBI's floating rate junior subordinated  deferrable interest
debt securities  ("Debentures")  due April 7, 2034,  which  securities,  and the
accrued interest thereon,  now constitute the Trust's sole assets.  The interest
rate  associated  with the debt  securities,  and the  distribution  rate on the
common  securities  of the  Trust,  was  established  initially  at 3.91% and is
adjustable  quarterly  at 3 month  LIBOR plus 280 basis  points.  The index rate
(LIBOR)  may not be lower than  1.11%.  CBI may defer  interest  payments on the
Debentures  for up to twenty  consecutive  quarters,  but not  beyond the stated
maturity date of the  Debentures.  In the event that such interest  payments are
deferred by CBI, the Trust may defer distributions on the common securities.  In
such an event,  CBI would be  restricted  in its ability to pay dividends on its
common  stock and  perform  under other  obligations  that are not senior to the
junior subordinated Debentures.



                                       8
<PAGE>

The  Debentures are redeemable at par at the option of CBI, in whole or in part,
on any interest  payment date on or after April 7, 2009. Prior to that date, the
Debentures  are  redeemable at 105% of par upon the occurrence of certain events
that  would have a  negative  effect on the Trust or that  would  cause it to be
required to be registered as an investment  company under the Investment Company
Act of 1940 or that would cause trust preferred securities not to be eligible to
be treated as Tier 1 capital by the Federal  Reserve  Board.  Upon  repayment or
redemption of the Debentures, the Trust will use the proceeds of the transaction
to redeem an equivalent  amount of trust  preferred  securities and trust common
securities.  The Trust's  obligations  under the trust preferred  securities are
unconditionally guaranteed by CBI.

The Company's investment in the Trust is carried at cost in other assets and the
debentures are included in long-term debt in the consolidated balance sheet.


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

Forward Looking Statements

         Statements  included in this report 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.  Forward-looking statements include statements
concerning plans, objectives,  goals,  strategies,  future events or performance
and underlying  assumptions and other statements which are other than statements
of historical facts. Such forward-looking statements may be identified,  without
limitation, by the use the of the words "anticipates,"  "believes," "estimates,"
"expects," "intends," "plans," "predicts,"  "projects," and similar expressions.
The Company's expectations,  beliefs, estimates and projections are expressed in
good faith and are believed by the Company to have a reasonable basis, including
without  limitation,  management's  examination of historical  operating trends,
data  contained in the  Company's  records and other data  available  from third
parties, but there can be no assurance that management's expectations,  beliefs,
estimates or projections will result or be achieved or accomplished. The Company
cautions readers that forward-looking statements,  including without limitation,
those  relating to the Company's  recent and  continuing  expansion,  its future
business  prospects,   revenues,  working  capital,  liquidity,  capital  needs,
interest  costs,  income,  and adequacy of the  allowance  for loan losses,  are
subject to 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  Company's  reports filed with the
Securities  and Exchange  Commission.  The Company  undertakes  no obligation to
publicly update or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.

References to our Website Address

         References to our website address  throughout this Quarterly  Report on
Form 10-Q and in any documents incorporated into this Form 10-Q by reference are
for informational purposes only, or to fulfill specific disclosure  requirements
of the Securities and Exchange Commission's rules or the American Stock Exchange
listing standards. These references are not intended to, and do not, incorporate
the contents of our website by reference into this Form 10-Q or the accompanying
materials.



                                       9
<PAGE>

Critical Accounting Policies

         CBI  has  adopted  various  accounting   policies,   which  govern  the
application of accounting  principles generally accepted in the United States of
America  in the  preparation  of CBI's  financial  statements.  The  significant
accounting policies of CBI are described in detail in the notes to CBI's audited
consolidated financial statements included in CBI's Annual Report on Form 10-K.

         Certain accounting policies involve significant judgments and estimates
by  management,  which have a material  impact on the carrying  value of certain
assets and  liabilities.  Management  considers such  accounting  policies to be
critical accounting policies. The judgments and estimates used by management are
based on  historical  experience  and other  factors,  which are  believed to be
reasonable under the  circumstances.  Because of the nature of the judgments and
assumptions made by management, actual results could differ from these judgments
and  estimates,  which could have a material  impact on the  carrying  values of
assets and liabilities and the results of operations of CBI.

         CBI is a  holding  company  for four  community  banks  and a  mortgage
company and, as a financial institution,  believes the allowance for loan losses
is a critical accounting policy that requires the most significant judgments and
estimates used in preparation of its consolidated financial statements. Refer to
the sections  "Allowance for Loan Losses" and "Provision for Loan Losses" in the
Annual  Report  on Form  10-K  for  2004  for a  detailed  description  of CBI's
estimation process and methodology related to the allowance for loan losses.


RESULTS OF OPERATIONS

Earnings Performance

         For the  quarter  ended March 31,  2005,  CBI earned  consolidated  net
income of $1,360,000,  compared with  $1,385,000  for the  comparable  period of
2004.  This  represents a decrease of $25,000 or 1.8%.  Basic earnings per share
were $.31 in the 2005 period,  compared with $.32 for the 2004 quarter.  Diluted
earnings per share were $.30 for the 2005 period and $.31 for the 2004 period.

         Operating  results  for the  first  quarter  of 2005 were  affected  by
increased net interest  income  resulting  from both higher  average  amounts of
loans and higher rates earned by those  assets,  which was  partially  offset by
higher interest  expenses  associated  mainly with interest bearing  transaction
accounts and time deposits.  The Federal  Reserve's  Open Market  Committee (the
"Committee")  continued  to raise the federal  funds rates  throughout  the 2005
first  quarter.  It is  expected  that  such  actions  will  continue  until the
Committee is satisfied that inflation does not pose a significant  threat to the
economy.  The  principal  effects of those rate  increases  has been to increase
market rates of interest in the  short-to-medium  term range,  while longer term
interest  rates have been affected to a lesser  degree.  For example,  since the
Committee  initiated its actions in June of 2004, the Prime Rate, the short-term
rate that banks charge to their most credit-worthy  customers,  has increased by
175 basis points to 5.75%, rates on one-year  treasuries have risen by 118 basis
points and rates on 20 year Treasury  securities have fallen by 56 basis points.
Similarly,  rates for conventional  mortgages have fallen by 36 basis ponts over
the same time period. For the Company, these changes in interest rates generally
result in increases in rates associated with new and pre-existing  variable rate
loans,  increased  rates  charged for new and renewed  loans,  and higher  rates
realized for federal funds sold and new investments in securities.  Also,  since


                                       10
<PAGE>

the  Company's  funding  sources  are  generally  short-term   deposits,   rates
associated with those sources, as well as any short-term borrowings, are subject
to increases, as well.

         Also,  the  results  for the 2005 period  were  affected  adversely  by
continuing  reevaluation  of the  Company's  allowance  for loan  losses,  which
resulted  in an  increase  of  $217,000  in the  provision  for loan losses when
compared with the same period of 2004.

         Noninterest income for the 2005 first quarter was $79,000 less than for
the same period of 2004 due to  decreased  service  charges  assessed on deposit
accounts and for other services.  Mortgage  brokerage income for the 2005 period
was $45,000 more than for the same period of 2004,  due to a slight  increase in
mortgage lending activity.

         Noninterest  expense for the first  quarter of 2005 was  $386,000  more
than for the same period of 2004 due to  increases  of $167,000 in salaries  and
employee  benefits,  $44,000 in premises and equipment  expenses and $175,000 in
other expenses,  primarily  related to increased  expenses to facilitate  future
compliance with the internal control over financial reporting  provisions of the
Sarbanes-Oxley Act of 2002.

<TABLE>
<CAPTION>
                                                                                   Summary Income Statement
                                                                                   ------------------------
                                                                                    (Dollars in thousands)
For the Three Months Ended March 31,                         2005               2004            Dollar Change   Percentage Change
------------------------------------                         ----               ----            -------------   -----------------
<S>                                                       <C>                 <C>                  <C>                 <C>
Interest income .....................................     $ 7,151             $ 5,908              $1,243              21.0%
Interest expense ....................................       2,216               1,640                 576              35.1%
                                                          -------             -------              ------
Net interest income .................................       4,935               4,268                 667              15.6%
Provision for loan losses ...........................         450                 233                 217              93.1%
Noninterest income ..................................       1,767               1,846                 (79)             -4.3%
Noninterest expenses ................................       4,119               3,733                 386              10.3%
Income tax expense ..................................         773                 763                  10               1.3%
                                                          -------             -------              ------
Net income ..........................................     $ 1,360             $ 1,385              $  (25)             -1.8%
                                                          =======             =======              ======
</TABLE>

Net Interest Income

         Net interest income is the amount of interest income earned on interest
earning assets (primarily loans, securities,  interest bearing deposits in other
banks,  and federal funds sold),  less the interest expense incurred on interest
bearing liabilities (interest bearing deposits and other borrowings), and is the
principal source of the Company's  earnings.  Net interest income is affected by
the level of  interest  rates,  volume and mix of  interest  earning  assets and
interest bearing liabilities and the relative funding of those assets.

         Interest  income  increased by $1,243,000,  or 21.0%, in the 2005 first
quarter compared with the same 2004 period. Interest income from loans increased
from  $5,331,000 in the 2004 period to  $6,614,000 in the 2005 period  primarily
due to larger  volumes of loans  outstanding,  supplemented  by slightly  higher
interest rates  associated  with those loans.  The amounts of interest earned on
all other  categories of interest  earning assets  decreased by $40,000,  in the
aggregate, as increases in the average yields earned on those assets were offset
by smaller average balances held.

         Interest  expense for deposits  increased from  $1,232,000 for the 2004
period to  $1,735,000  for the 2005  period  primarily  due to  increased  rates




                                       11
<PAGE>

associated  with all  categories of interest  bearing  deposits.  Larger average
amounts of interest-bearing deposits also contributed to this increased interest
expense.

         During the first quarter of 2004, CBI sponsored the creation of a Trust
that issued  $10,000,000 in trust preferred  securities.  The Trust invested the
proceeds  of  this  issuance  and  $310,000  of  capital  provided  by CBI  into
$10,310,000  of junior  subordinated  debentures  ("Debentures")  issued by CBI.
Interest  payments on the  Debentures  are due quarterly at a variable  interest
rate. CBI used the proceeds of the Debentures to repay certain pre-existing debt
obligations,  to enhance the capital position of two of the subsidiary banks, to
provide an additional funding mechanism for its mortgage  brokerage  activities,
and for other general corporate purposes.  Under current regulatory  guidelines,
the trust  preferred  securities  issued by the Trust are  includible  in Tier 1
capital for risk-based capital purposes.

         In the first quarter of 2005,  interest  expenses for  long-term  debt,
which includes the Debentures and FHLB advances,  totaled $438,000,  an increase
of  $135,000,  or 44.6%,  over the amount for the same  period of 2004.  Average
amounts  outstanding  increased by $8,370,000,  or 36.8%,  and the interest rate
paid for such borrowings increased by 30 basis points.

         Partially offsetting these factors were decreased interest expenses for
short-term borrowings,  which were $62,000 lower in the 2005 quarter than in the
2004 period,  resulting from lower average  amounts of such  borrowings and a 48
basis point reduction in the rate paid.




                                       12
<PAGE>

<TABLE>
<CAPTION>

                                                                               Average Balances, Yields and Rates
                                                                                  Three Months Ended March 31,
                                                                                  ----------------------------

                                                                           2005                                   2004
                                                                           ----                                   ----
                                                                         Interest                               Interest
                                                              Average     Income /  Yields /         Average     Income /   Yields /
                                                             Balances     Expense    Rates *        Balances     Expense    Rates *
                                                             --------     -------    -------        --------     -------    -------
                                                                                       (Dollars in thousands)
Assets
<S>                                                        <C>            <C>         <C>          <C>           <C>          <C>
Interest earning deposits ............................     $      794     $     8     4.09%        $   1,110     $     4      1.46%
Investment securities - taxable ......................         52,075         405     3.15%           57,236         431      3.05%
Investment securities - tax exempt ...................          6,825          56     3.33%           10,208          84      3.34%
Federal funds sold ...................................         11,744          68     2.35%           24,647          58      0.95%
Loans, including loans held for sale .................        415,869       6,614     6.45%          341,982       5,331      6.32%
                                                           ----------     -------                  ---------     -------
         Total interest earning assets ...............        487,307       7,151     5.95%          435,183       5,908      5.51%
Cash and due from banks ..............................         15,826                                 17,314
Allowance for loan losses ............................         (4,816)                                (4,162)
Premises and equipment ...............................          7,888                                  7,073
Intangible assets ....................................          7,372                                  7,618
Other assets .........................................          4,165                                  3,860
                                                           ----------                              ---------
         Total assets ................................     $  517,742                              $ 466,886
                                                           ==========                              =========

Liabilities and shareholders' equity
Interest bearing deposits
     Interest bearing transaction accounts ...........     $   64,420     $    95     0.60%        $  57,474     $    66      0.47%
     Savings .........................................         90,073         307     1.38%           79,663         183      0.93%
     Time deposits ...................................        208,779       1,333     2.59%          181,616         983      2.20%
                                                           ----------     -------                  ---------     -------
         Total interest bearing deposits .............        363,272       1,735     1.94%          318,753       1,232      1.57%
Short-term borrowings ................................          8,446          43     2.06%           16,767         105      2.54%
Long-term debt .......................................         31,088         438     5.71%           22,718         303      5.41%
                                                           ----------     -------                  ---------     -------
         Total interest bearing liabilities ..........        402,806       2,216     2.23%          358,238       1,640      1.86%
Noninterest bearing demand deposits ..................         62,815                                 58,045
Other liabilities ....................................          1,456                                  1,836
Shareholders' equity .................................         50,665                                 48,767
                                                           ----------                              ---------
Total liabilities and shareholders' equity ...........     $  517,742                              $ 466,886
                                                           ==========                              =========

Interest rate spread .................................                                3.72%                                   3.65%
Net interest income and net yield
     on earning assets ...............................                    $ 4,935     4.11%                      $ 4,268      3.98%
</TABLE>
* Yields and rates are annualized.


Provision and Allowance for Loan Losses

         The  provision for loan losses for the 2005 first quarter was $450,000,
an increase of  $217,000,  or 93.1%,  from the  $233,000  for the same period of
2004.  This  increase was due primarily to an increase in  non-performing  loans
during the 2005 first quarter, as discussed further below.

         Net  charge-offs  during the three  months  ended  March 31,  2005 were
$75,000,  compared with $234,000 for the same period of 2004.  The allowance for
loan losses as of March 31, 2005 was 1.16% of loans  outstanding,  compared with
1.10% as of December 31, 2004 and 1.24% as of March 31, 2004.



                                       13
<PAGE>


         The  activity in the  allowance  for loan losses is  summarized  in the
following table:
<TABLE>
<CAPTION>

                                                                            Three Months                                Three Months
                                                                                Ended             Year Ended                Ended
                                                                              March 31,          December 31,             March 31,
                                                                                 2005                2004                    2004
                                                                                 ----                ----                    ----
                                                                                               (Dollars in thousands)
<S>                                                                          <C>                   <C>                   <C>
Allowance at beginning of period .................................           $   4,347             $   4,206             $   4,206
Provision for loan losses ........................................                 450                 5,102                   233
Net charge-offs ..................................................                 (75)               (4,961)                 (234)
                                                                             ---------             ---------             ---------
Allowance at end of period .......................................           $   4,722             $   4,347             $   4,205
                                                                             =========             =========             =========
Allowance as a percentage of loans outstanding ...................                1.16%                 1.10%                 1.24%

Loans at end of period ...........................................           $ 406,049             $ 393,649             $ 338,945
                                                                             =========             =========             =========
</TABLE>

         Non-performing  loans,  consisting of nonaccrual  loans and loans 90 or
more days past due which are still accruing  interest,  totaled $5,412,000 as of
March 31, 2005, compared with $5,078,000 as of December 31, 2004, an increase of
$334,000 or 6.6%.  The majority of  non-performing  loans at March 31, 2005 were
secured by  commercial  real estate and other  collateral.  The  coverage  ratio
(allowance for loan losses divided by  non-performing  loans) was .9x as of both
March 31, 2005 and December 31, 2004.  Non-performing loans as of March 31, 2004
totaled $1,482,000.

         Following is a summary of non-performing loans as of March 31, 2005 and
December 31, 2004:



                                                         March 31,  December 31,
                                                           2005         2004
                                                           ----         ----
                                                          (Dollars in thousands)
Non-performing loans
  Nonaccrual loans ...................................    $5,059       $4,941
  Past due 90 days or more and still accruing ........       353          137
                                                          ------       ------
                     Total ...........................    $5,412       $5,078
                                                          ======       ======
Nonperforming loans as a percentage
  of loans outstanding ...............................      1.33%        1.29%


         Included  in  nonaccrual  loans as of March  31,  2005,  is one  credit
relationship  totaling  $2,444,000,  or 48.3% of total  nonaccrual  loans.  This
credit originated in 2004 to finance the borrower's purchase of a business.  The
business did not perform as expected and the  borrower  subsequently  discovered
problems with  information  supporting an appraisal of the business.  Because of
deterioration of the borrower's financial  condition,  proceeds from sale of the
business are expected to be the primary  source of repayment.  During the fourth
quarter of 2004, a partial  charge-off of $1,001,000 was recorded.  The borrower
is  cooperating  with  management  to maximize  ultimate  collection by actively
pursuing sale of the business as an operating concern. If the business cannot be
sold  for a  sufficient  price  within a  reasonable  period  of  time,  further
write-downs  might be necessary  which could decrease net income.  Approximately
$367,000  of the  allowance  for loan losses is  allocated  to this credit as of
March 31, 2005.

         Management  will continue to monitor the levels of  non-performing  and
potential  problem loans and address the weaknesses in these credits in order to
enhance the  probability  of collection or recovery of these assets.  Management


                                       14
<PAGE>

considers the levels and trends in  non-performing  assets and past due loans in
determining  how the  provision  and  allowance for loan losses is estimated and
adjusted.


Noninterest Income

         Noninterest income for the 2005 period decreased $79,000, or 4.3%, from
the $1,846,000 reported for the 2004 period. Service charges on deposit accounts
decreased by $83,000 from the prior year amount. This decrease was the result of
fewer assessable  transactions.  Mortgage  brokerage income increased $45,000 or
6.0%,  from $749,000 for the 2004 period,  due to a small increase in the number
of loans originated in the quarter.


Noninterest Expenses

         Salaries  and employee  benefits  for the 2005 period were  $167,000 or
7.9%, more than in the same 2004 period.  This increase resulted  primarily from
expenses associated with the hiring of a new chief executive officer and several
other  administrative  officers  since  the end of the  first  quarter  of 2004.
Expenses associated with premises and equipment were $44,000, or 9.0%, higher in
the  2005  period,  primarily  due to  adding a branch  office  of the  Florence
National Bank subsidiary.


Income Taxes

         Income tax expense for 2005 increased $10,000, or 1.3%, from the amount
for 2004.  The  average  tax rate  used for 2005 was 36.2%  while in 2004 it was
35.5%.  The  increase  in the  average  tax rate for 2005 is a result of a lower
percentage  of income  being  derived  from  tax-exempt  sources in the  current
period.  Interest income from tax-exempt  investment securities was $28,000 less
in 2005 than in 2004 and  represented  2.6% of pretax income in the 2005 period,
compared with 3.9% in the 2004 period.


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 CBI's service areas.  Individual and commercial  deposits are the primary
source of funds for credit activities,  along with long-term borrowings from the
Federal Home Loan Bank of Atlanta and the net proceeds of issuing $10,000,000 of
trust  preferred  securities.  Cash and amounts due from banks and federal funds
sold are CBI's primary sources of asset liquidity. These funds provide a cushion
against  short-term  fluctuation  in cash  flow from  both  loans and  deposits.
Securities  available-for-sale  are CBI's  principal  source of secondary  asset
liquidity.  However,  the  availability  of this  source is limited by  pledging
commitments  for  public  deposits  and  securities  sold  under  agreements  to
repurchase, and is influenced by market conditions.

         Total deposits as of March 31, 2005 were  $430,066,000,  an increase of
$6,608,000,  or 1.6%,  from the amount as of December 31, 2004.  As of March 31,
2005 the loan to deposit  ratio was 94.4%,  compared  with 93.0% at December 31,
2004 and 92.2% at March 31, 2004. Loans  held-for-sale have not been included in


                                       15
<PAGE>

the  denominator of the  calculation  of the loan to deposit ratio.  The banking
subsidiaries  have  significant   amounts  of  long-term  debt  available  under
agreements with the Federal Home Loan Bank of Atlanta.

         Management  believes CBI and its  subsidiaries'  liquidity  sources are
adequate to meet their current and projected operating needs.

CAPITAL RESOURCES

         CBI and its banking  subsidiaries are subject to regulatory  risk-based
capital adequacy  standards.  Under these standards,  bank holding companies and
banks  are  required  to  maintain   certain   minimum   ratios  of  capital  to
risk-weighted  assets and average  total  assets.  Under the  provisions  of the
Federal Deposit  Insurance  Corporation  Improvement  Act of 1991,  federal bank
regulatory  authorities are required to implement  prescribed "prompt corrective
actions"  upon the  deterioration  of the  capital  position  of a bank.  If the
capital position of an affected  institution were to fall below a certain level,
increasingly stringent regulatory corrective actions would be mandated.

         The March 31, 2005  risk-based  capital  ratios for CBI and its banking
subsidiaries  are  presented in the  following  table,  compared  with the "well
capitalized" and minimum ratios under the regulatory definitions and guidelines:

                                                        March 31, 2005
                                                        --------------
                                                Tier 1   Total Capital  Leverage
                                                ------   -------------  --------

Community Bankshares, Inc. ....................  13.75%      14.94%     10.71%
Orangeburg National Bank ......................  11.98%      13.16%      8.63%
Sumter National Bank ..........................   9.64%      10.84%      8.18%
Florence National Bank ........................   9.17%      10.11%      8.29%
Bank of Ridgeway ..............................  12.86%      13.76%      8.69%
Minimum "well capitalized" requirement ........   6.00%      10.00%      6.00%
Minimum requirement ...........................   4.00%       8.00%      4.00%


         As shown in the table  above,  each of the capital  ratios  exceeds the
regulatory  requirement to be considered  "well  capitalized." In the opinion of
management,  the current and projected  capital positions of CBI and its banking
subsidiaries are adequate.

OFF-BALANCE-SHEET ARRANGEMENTS

         In the normal course of business,  CBI engages in transactions that, in
accordance with generally accepted  accounting  principles,  are not recorded in
the  financial  statements  (generally  commitments  to  extend  credit)  or are
recorded  in  amounts  that  differ  from  their  notional  amounts   (generally
derivatives).  These transactions involve elements of credit,  interest rate and
liquidity risk of varying degrees. Such transactions are used by CBI for general
corporate purposes.

Variable Interest Entity

         As discussd under "Results of Operations - Net Interest  Income" and in
the  notes  to  unaudited  consolidated  financial  statements  under  "Variable
Interest  Entities," as of March 31, 2005,  CBI held an equity  interest in, and
guarantees the liabilities of, a non-consolidated variable interest entity.




                                       16
<PAGE>

Commitments

         CBI's banking and mortgage brokerage subsidiaries are parties to credit
related financial instruments with  off-balance-sheet  risk in the normal course
of business to meet the  financing  needs of their  customers.  These  financial
instruments  include commitments to extend credit and standby letters of credit.
Such  commitments  involve  varying  degrees of credit and interest rate risk in
excess of the amount recognized in the consolidated balance sheets.  Exposure to
credit loss is represented  by the  contractual,  or notional,  amounts of these
commitments.  The same credit  policies  are used in making  commitments  as for
on-balance-sheet instruments.

The following  table sets forth the  contractual  amounts of  commitments  which
represent credit risk:

                                                        March 31, 2005
                                                        --------------
                                                         (Dollars in
                                                          thousands)
Loan commitments .................................          $50,954
Standby letters of credit ........................            2,967


         Commitments  to extend  credit are  agreements to lend to a customer as
long as there is no  violation of any  condition  established  in the  contract.
Commitments  generally have fixed expiration dates or other termination  clauses
and may require  payment of a fee. Since many of the commitments are expected to
expire without being drawn upon, the total commitment amounts do not necessarily
represent future cash requirements. The amount of collateral obtained, if deemed
necessary  by  management  upon  extension of credit,  is based on  management's
credit evaluation of the  counter-party.  Collateral held varies but may include
personal  residences,  accounts  receivable,   inventory,  property,  plant  and
equipment, and income-producing commercial properties.

         Standby  letters  of  credit  are  conditional  commitments  issued  to
guarantee  the  performance  of a customer to a third  party.  Those  letters of
credit are  primarily  issued to support  private  borrowing  arrangements.  All
letters of credit are short-term guarantees. The credit risk involved in issuing
letters of credit is  essentially  the same as that  involved in extending  loan
facilities to customers.  Generally,  collateral supporting those commitments is
held if deemed  necessary.  Since  many of the  standby  letters  of credit  are
expected to expire  without being drawn upon, the total letter of credit amounts
do not necessarily represent future cash requirements.

         On March 22, 2005, CBI entered into a contract for the  construction of
an approximately 16,000 square foot two-story brick office building to house its
corporate  headquarters  and  operations  center.  The  contract  price for this
project is  $1,476,000.  Management  expects  completion  of the building in the
fourth quarter of 2005.

Derivative Financial Instruments

         In  April,  2003,  the  Financial  Accounting  Standards  Board  issued
Statement No. 149,  "Amendment of Statement  133 on Derivative  Instruments  and
Hedging Activities." Among other requirements, this Statement provides that loan
commitment contracts entered into or modified after June 30, 2003 that relate to
the  origination of mortgage loans that will be held for sale shall be accounted
for as derivative  instruments by the issuer of the loan commitment.  CBI issues
mortgage loan rate lock  commitments  to potential  borrowers to facilitate  its
origination  of home  mortgage  loans that are intended to be sold.  Between the
time that CBI issues its  commitments  and the time that the loans close and are
sold,  CBI is subject to  variability  in the  selling  prices  related to those


                                       17
<PAGE>

commitments  due to changes in market  rates of interest.  However,  CBI offsets
this  variability  through the use of so-called  "forward  sales  contracts"  to
investors in the secondary market. Under these arrangements,  an investor agrees
to purchase the closed loans at a predetermined price. CBI generally enters into
such forward  sales  contracts at the same time that rate lock  commitments  are
issued. These arrangements are designated as fair value hedges. These derivative
financial  instruments  are carried in the balance sheet at estimated fair value
and changes in the estimated  fair values of these  derivatives  are recorded in
the statement of income in net gains or losses on loans held for sale.

         Derivative financial  instruments are written in amounts referred to as
notional  amounts.  Notional  amounts  only  provide  the basis for  calculating
payments  between  counterparties  and do not represent  amounts to be exchanged
between parties or a measure of financial risk. The following table includes the
notional  principal amounts of rate lock commitments and forward sales contracts
as of  March  31,  2005,  and the  estimated  fair  values  of  those  financial
instruments  included in other assets and liabilities in the balance sheet as of
that date.


                                                           March 31, 2005
                                                           --------------
                                                                      Estimated
                                                                      Fair Value
                                                         Notional       Asset
                                                          Amount     (Liability)
                                                          ------     -----------
                                                          (Dollars in thousands)
Rate lock commitments to potential borrowers
  to originate mortgage loans to be
  held for sale ....................................     $(13,303)          $(7)
Forward sales contracts with investors
  of mortgage loans to be held for sale ............     $ 13,303           $ 7


Item 3. Quantitative and Qualitative Disclosures about Market Risk

         Market risk is the risk of loss from adverse  changes in market  prices
and rates. CBI'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 CBI 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 this  risk  could  potentially  have the  largest  material  effect on CBI'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.

         CBI's  Asset/Liability  Committee uses a simulation  model to assist in
achieving  consistent growth in net interest income while managing interest rate
risk.  According to the model,  as of March 31, 2005,  CBI is positioned so that
net interest  income  would  increase  $269,000  and net income  would  increase
$175,000 in the next  twelve  months if  interest  rates rose 100 basis  points.
Conversely,  net  interest  income would  decline  $269,000 and net income would
decline  $175,000 in the next twelve months if interest rates declined 100 basis
points. In the current interest rate environment,  it is not expected that there
will be any large  decreases in market  interest rates in the immediate  future.
Computation of  prospective  effects of  hypothetical  interest rate changes are


                                       18
<PAGE>

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 CBI and its
customers could undertake in response to changes in interest rates.

         As of March 31, 2005 there was no significant  change from the interest
rate  sensitivity  analysis for the various changes in interest rates calculated
as of December 31, 2004. The foregoing disclosures related to the market risk of
CBI should be read in connection  with  Management's  Discussion and Analysis of
Financial Position and Results of Operations  included in the 2004 Annual Report
on Form 10-K.

Item 4.  Controls and Procedures

         Based on the evaluation required by 17 C.F.R. Section  240.13a-15(b) or
240.15d-15(b) of the Company's disclosure controls and procedures (as defined in
17  C.F.R.  Sections  240.13a-15(e)  or  240.15d-15(e)),   the  Company's  chief
executive  officer and chief financial  officer concluded that such controls and
procedures, as of the end of the period covered by this report, were effective.

         There  has  been no  change  in the  Company's  internal  control  over
financial  reporting  during the most recent fiscal  quarter that has materially
affected,  or is reasonably likely to materially  affect, the Company's internal
control over financial reporting.





                                       19
<PAGE>


                           PART II--OTHER INFORMATION

Item 6.  Exhibits

Exhibits    10     Agreement Between Community Bankshares, Inc. and C. F. Evans
                   & Company, Inc.

            31-1   Rule 13a-14(a)/15d-14(a) Certification of principal executive
                   officer

            31-2   Rule 13a-14(a)/15d-14(a) Certification of principal financial
                   officer

            32     Certifications Pursuant to 18 U.S.C. Section 1350





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<PAGE>


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: May 12, 2005

COMMUNITY BANKSHARES, INC.

By:  s/  Samuel L. Erwin
   -----------------------------------------------
         Samuel L. Erwin
         Chief Executive Officer

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






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