----

| Financial Highlights                            |   |   |         |   |   |           |   |   |   |   |   |    |   |   |    |
|-------------------------------------------------|--------|--------|--------------|--------|--------|----------------|--------|--------|--------|--------|--------|---------|--------|--------|---------|
|                                            |   |   | December 31, |   |   | Percent Change |   |
| (Dollars in thousands, except per common share) |   | 2010   |         |   | 2009   |           |   | 2008   |   |   |   | 2010/09 |   |   | 2009/08 |   |
|  Balance Sheet                             |   |   |         |   |   |           |   |   |   |   |   |    |   |   |    |   |   |   |   |

|                         | Total assets                                |   | $      | 505,759 |   |   | $      | 492,898 |   |   | $      | 469,473 |   |   |   | 2.6    | %      |   |   | 5.0    | %      |
|------------------------------|---------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                         | Loans                                       |   |   | 256,834 |   |   |   | 267,248 |   |   |   | 270,413 |   |   |   | -3.9   | %      |   |   | -1.2   | %      |
|                         | Securities                                  |   |   | 175,758 |   |   |   | 150,734 |   |   |   | 138,546 |   |   |   | 16.6   | %      |   |   | 8.8    | %      |
|                         | Total deposits                              |   |   | 445,310 |   |   |   | 436,648 |   |   |   | 416,115 |   |   |   | 2.0    | %      |   |   | 4.9    | %      |
|                         | Shareholders' equity                        |   |   | 45,311  |   |   |   | 44,818  |   |   |   | 39,928  |   |   |   | 1.1    | %      |   |   | 12.2   | %      |
|                         |                                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| For the Year                 |                                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |
|                         | Net interest income                         |   | $      | 13,287  |   |   | $      | 12,068  |   |   | $      | 11,717  |   |   |   | 10.1   | %      |   |   | 3.0    | %      |
|                         | Provision for loan losses                   |   |   | 4,525   |   |   |   | 4,355   |   |   |   | 4,550   |   |   |   | 3.9    | %      |   |   | -4.3   | %      |
|                         | Noninterest income                          |   |   | 2,563   |   |   |   | 2,718   |   |   |   | 2,495   |   |   |   | -5.7   | %      |   |   | 8.9    | %      |
|                         | Noninterest expenses                        |   |   | 10,110  |   |   |   | 9,249   |   |   |   | 8,067   |   |   |   | 9.3    | %      |   |   | 14.7   | %      |
|                         | Income tax expense                          |   |   | 102     |   |   |   | 81      |   |   |   | 253     |   |   |   | 25.9   | %      |   |   | -68.0  | %      |
|                         | Net income                                  |   |   | 1,113   |   |   |   | 1,101   |   |   |   | 1,342   |   |   |   | 1.1    | %      |   |   | -18.0  | %      |
|                         | Net income available to common shareholders |   |   | 936     |   |   |   | 1,101   |   |   |   | 1,342   |   |   |   | -15.0  | %      |   |   | -18.0  | %      |
|                         |                                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Per common share (1)         |                                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |
|                         | Net income, basic                           |   | $      | 0.24    |   |   | $      | 0.28    |   |   | $      | 0.34    |   |   |   | -14.3  | %      |   |   | -17.6  | %      |
|                         | Net income, assuming dilution               |   |   | 0.24    |   |   |   | 0.28    |   |   |   | 0.33    |   |   |   | -14.3  | %      |   |   | -15.2  | %      |
|                         | Book value at year end                      |   |   | 11.40   |   |   |   | 10.50   |   |   |   | 10.16   |   |   |   | 8.6    | %      |   |   | 3.3    | %      |
|                         |                                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Financial Performance Ratios |                                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |
|                         | Return on average assets                    |   |   | 0.21    | %      |   |   | 0.23    | %      |   |   | 0.31    | %      |   |   |   |   |   |   |   |   |
|                         | Return on average equity                    |   |   | 2.40    | %      |   |   | 2.64    | %      |   |   | 3.38    | %      |   |   |   |   |   |   |   |   |
|                         |                                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Asset Quality Ratios (2)     |                                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |
|                         | Nonperforming loans to total loans          |   |   | 6.36    | %      |   |   | 5.19    | %      |   |   | 4.36    | %      |   |   |   |   |   |   |   |   |
|                         | Allowance for loan losses times             |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
|                         |     nonperforming loans      |   |   | 0.4     | x      |   |   | 0.4     | x      |   |   | 0.5     | x      |   |   |   |   |   |   |   |   |
|                         | Net charge-offs to                          |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
|                         |     average total loans      |   |   | 1.84    | %      |   |   | 1.39    | %      |   |   | 0.64    | %      |   |   |   |   |   |   |   |   |
|                         |                                        |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |   |   |   |

| (1) | Adjusted to reflect 5% stock dividends effective December 16, 2010 and December 15, 2009. |
|-----|-------------------------------------------------------------------------------------------|
| (2) | Nonperforming loans include nonaccrual loans and accruing loans 90 days or more past due. |

----

| Financial Summary                                                                           |   |                                                 |    |   |   |   |    |   |   |   |    |   |   |   |    |
|---------------------------------------------------------------------------------------------|--------|------------------------------------------------------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|
|                                                                                        |   |                                                 |    |   |   |   |    |   |   |   |    |   |   |   |    |
|                                                                                        |   | Years Ended December 31,                             |    |
|                                                                                        |   | 2010                                                 |    |   | 2009   |   |    | 2008   |   |   | 2007    |   |   | 2006   |    |
|                                                                                        |   | (Dollars in thousands, except per common share data) |    |
| Financial Condition                                                                         |   |                                                 |    |   |   |   |    |   |   |   |    |   |   |   |    |
| Securities                                                                                  |   | $                                                    | 175,758 |   |   | $      | 150,734 |   |   | $      | 138,546 |   |   | $      | 104,689 |   |   | $ | 109,082 |   |
| Allowance for loan losses                                                                   |   |                                                 | 5,756   |   |   |   | 6,052   |   |   |   | 5,475   |   |   |   | 2,574   |   |   |   | 2,242 |   |
| Net loans (1)                                                                               |   |                                                 | 251,078 |   |   |   | 261,196 |   |   |   | 264,938 |   |   |   | 241,557 |   |   |   | 200,724 |   |
| Premises and equipment - net                                                                |   |                                                 | 8,170   |   |   |   | 8,470   |   |   |   | 8,655   |   |   |   | 8,622   |   |   |   | 7,937 |   |
| Total assets                                                                                |   |                                                 | 505,759 |   |   |   | 492,898 |   |   |   | 469,473 |   |   |   | 402,148 |   |   |   | 353,909 |   |
| Noninterest bearing deposits                                                                |   |                                                 | 46,844  |   |   |   | 47,067  |   |   |   | 41,962  |   |   |   | 42,289  |   |   |   | 40,576 |   |
| Interest bearing deposits                                                                   |   |                                                 | 398,466 |   |   |   | 389,581 |   |   |   | 374,153 |   |   |   | 313,578 |   |   |   | 267,381 |   |
| Total deposits                                                                              |   |                                                 | 445,310 |   |   |   | 436,648 |   |   |   | 416,115 |   |   |   | 355,867 |   |   |   | 307,957 |   |
| Total liabilities                                                                           |   |                                                 | 460,448 |   |   |   | 448,080 |   |   |   | 429,545 |   |   |   | 364,237 |   |   |   | 320,694 |   |
| Total shareholders' equity                                                                  |   |                                                 | 45,311  |   |   |   | 44,818  |   |   |   | 39,928  |   |   |   | 37,911  |   |   |   | 33,215 |   |
|                                                                                        |   |                                                 |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Results of Operations                                                                       |   |                                                 |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Interest income                                                                             |   | $                                                    | 21,840  |   |   | $      | 22,951  |   |   | $      | 24,551  |   |   | $      | 23,578  |   |   | $ | 19,600 |   |
| Interest expense                                                                            |   |                                                 | 8,553   |   |   |   | 10,883  |   |   |   | 12,834  |   |   |   | 13,230  |   |   |   | 10,385 |   |
| Net interest income                                                                         |   |                                                 | 13,287  |   |   |   | 12,068  |   |   |   | 11,717  |   |   |   | 10,348  |   |   |   | 9,215 |   |
| Provision for loan losses                                                                   |   |                                                 | 4,525   |   |   |   | 4,355   |   |   |   | 4,550   |   |   |   | 594     |   |   |   | 65 |   |
| Net interest income after provision                                                         |   |                                                 | 8,762   |   |   |   | 7,713   |   |   |   | 7,167   |   |   |   | 9,754   |   |   |   | 9,150 |   |
| Other income                                                                                |   |                                                 | 2,563   |   |   |   | 2,718   |   |   |   | 2,495   |   |   |   | 2,206   |   |   |   | 2,154 |   |
| Other expenses                                                                              |   |                                                 | 10,110  |   |   |   | 9,249   |   |   |   | 8,067   |   |   |   | 7,132   |   |   |   | 6,752 |   |
| Income before income taxes                                                                  |   |                                                 | 1,215   |   |   |   | 1,182   |   |   |   | 1,595   |   |   |   | 4,828   |   |   |   | 4,552 |   |
| Income tax expense                                                                          |   |                                                 | 102     |   |   |   | 81      |   |   |   | 253     |   |   |   | 1,497   |   |   |   | 1,534 |   |
| Net income                                                                                  |   |                                                 | 1,113   |   |   |   | 1,101   |   |   |   | 1,342   |   |   |   | 3,331   |   |   |   | 3,018 |   |
| Deduction for dividends declared      or accumulated on preferred       |   |                                                 |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
|             stock and unavailable to |   |                                                 |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
|             common shareholders      |   |                                                 | (177    | )      |   |   | -       |   |   |   | -       |   |   |   | -       |   |   |   | - |   |
| Net income available to common shareholders                                                 |   | $                                                    | 936     |   |   | $      | 1,101   |   |   | $      | 1,342   |   |   | $      | 3,331   |   |   | $ | 3,018 |   |
|                                                                                        |   |                                                 |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Per Common Share Data (2)                                                                   |   |                                                 |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Net income, basic                                                                           |   | $                                                    | 0.24    |   |   | $      | 0.28    |   |   | $      | 0.34    |   |   | $      | 0.88    |   |   | $ | 0.81 |   |
| Net income, assuming dilution                                                               |   |                                                 | 0.24    |   |   |   | 0.28    |   |   |   | 0.33    |   |   |   | 0.83    |   |   |   | 0.75 |   |
| Period end book value                                                                       |   |                                                 | 10.62   |   |   |   | 10.50   |   |   |   | 10.16   |   |   |   | 9.85    |   |   |   | 8.82 |   |
|                                                                                        |   |                                                 |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |

|  (1) | Excludes any loans held for sale. |
|-----------|-----------------------------------|

|  (2)  | Per common share amounts have been retroactively adjusted to reflect 5% stock dividends effective December 16, 2010, December 15, 2009 and December 20, 2008, and a 10% stock dividend effective December 20, 2007. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Quarterly Financial Information (Unaudited) |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |
|---------------------------------------------|--------|-------------------------------------------------|--------|--------|---------------|--------|--------|----------------|--------|--------|---------------|--------|--------|----------------|--------|--------|---------------|--------|--------|----------------|--------|--------|---------------|--------|
|                                        |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |
|                                        |   |  Years Ended December 31,                  |   |
|                                        |   | 2010                                            |   |   | 2009          |   |
|                                        |   | Fourth Quarter                                  |   |   | Third Quarter |   |   | Second Quarter |   |   | First Quarter |   |   | Fourth Quarter |   |   | Third Quarter |   |   | Second Quarter |   |   | First Quarter |   |
|                                        |   | (Dollars in thousands, except per common share) |
|                                        |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |
| Interest and dividend income                |   | $                                               | 5,155  |   |          | $      | 5,543  |           |   | $      | 5,616         |   |   | $              | 5,526  |   |          | $      | 5,577  |           |   | $      | 5,730         |   |   | $ | 5,861 |   |   | $ | 5,783 |   |
| Interest expense                            |   |                                            | 1,891  |   |          |   | 2,179  |           |   |   | 2,255         |   |   |           | 2,228  |   |          |   | 2,339  |           |   |   | 2,706         |   |   |   | 2,838 |   |   |   | 3,000 |   |
|                                        |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |   |   |   |   |   |   |   |
| Net interest income                         |   |                                            | 3,264  |   |          |   | 3,364  |           |   |   | 3,361         |   |   |           | 3,298  |   |          |   | 3,238  |           |   |   | 3,024         |   |   |   | 3,023 |   |   |   | 2,783 |   |
| Provision for loan losses (1)               |   |                                            | 1,250  |   |          |   | 1,025  |           |   |   | 1,125         |   |   |           | 1,125  |   |          |   | 1,895  |           |   |   | 1,010         |   |   |   | 700 |   |   |   | 750 |   |
|                                        |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |   |   |   |   |   |   |   |
| Net interest income after provision         |   |                                            | 2,014  |   |          |   | 2,339  |           |   |   | 2,236         |   |   |           | 2,173  |   |          |   | 1,343  |           |   |   | 2,014         |   |   |   | 2,323 |   |   |   | 2,033 |   |
| Noninterest income                          |   |                                            | 667    |   |          |   | 668    |           |   |   | 692           |   |   |           | 536    |   |          |   | 691    |           |   |   | 704           |   |   |   | 752 |   |   |   | 571 |   |
| Noninterest expense                         |   |                                            | 2,672  |   |          |   | 2,490  |           |   |   | 2,463         |   |   |           | 2,485  |   |          |   | 2,429  |           |   |   | 2,297         |   |   |   | 2,426 |   |   |   | 2,097 |   |
|                                        |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |   |   |   |   |   |   |   |
| Income (loss) before income taxes           |   |                                            | 9      |   |          |   | 517    |           |   |   | 465           |   |   |           | 224    |   |          |   | (395   | )              |   |   | 421           |   |   |   | 649 |   |   |   | 507 |   |
| Provision for income taxes                  |   |                                            | (112   | )      |          |   | 131    |           |   |   | 66            |   |   |           | 17     |   |          |   | (273   | )              |   |   | 101           |   |   |   | 160 |   |   |   | 93 |   |
|                                        |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |   |   |   |   |   |   |   |
| Net income (loss)                           |   |                                            | 121    |   |          |   | 386    |           |   |   | 399           |   |   |           | 207    |   |          |   | (122   | )              |   |   | 320           |   |   |   | 489 |   |   |   | 414 |   |
| Dividends declared or accrued               |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |   |   |   |   |   |   |   |
|    on preferred stock             |   |                                            | (39    | )      |          |   | (39    | )              |   |   | (40           | )      |   |           | (59    | )      |          |   | -      |           |   |   | -             |   |   |   | - |   |   |   | - |   |
| Net income available to                     |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |   |   |   |   |   |   |   |
|   common shareholders                  |   | $                                               | 82     |   |          | $      | 347    |           |   | $      | 359           |   |   | $              | 148    |   |          | $      | (122   | )              |   | $      | 320           |   |   | $ | 489 |   |   | $ | 414 |   |
|                                        |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |   |   |   |   |   |   |   |
| Net income per common share (2)             |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |   |   |   |   |   |   |   |
|    Basic                          |   | $                                               | 0.02   |   |          | $      | 0.09   |           |   | $      | 0.09          |   |   | $              | 0.04   |   |          | $      | (0.04  | )              |   | $      | 0.08          |   |   | $ | 0.13 |   |   | $ | 0.11 |   |
|    Diluted                        |   |                                            | 0.02   |   |          |   | 0.09   |           |   |   | 0.09          |   |   |           | 0.04   |   |          |   | (0.04  | )              |   |   | 0.08          |   |   |   | 0.13 |   |   |   | 0.11 |   |
|                                        |   |                                            |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |           |   |   |          |   |   |   |   |   |   |   |   |   |

----

| ·   | future economic and business conditions; |
|--------------------|------------------------------------------|

| ·   | lack of sustained growth and disruptions in the economies of the Company's market areas; |
|--------------------|------------------------------------------------------------------------------------------|

| ·   | government monetary and fiscal policies; |
|--------------------|------------------------------------------|

| ·   | the effects of changes in interest rates on the levels, composition and costs of deposits, loan demand, and the values of loan collateral, securities, and interest sensitive assets and liabilities; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the effects of competition from a wide variety of local, regional, national and other providers of financial, investment, and insurance services, as well as competitors that offer banking products and services by mail, telephone, computer and/or the Internet; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | credit risks; |
|--------------------|---------------|

| ·   | higher than anticipated levels of defaults on loans; |
|--------------------|------------------------------------------------------|

| ·   | perceptions by depositors about the safety of their deposits; |
|--------------------|---------------------------------------------------------------|

| ·   | capital adequacy; |
|--------------------|-------------------|

| ·   | the failure of assumptions underlying the establishment of the allowance for loan losses and other estimates, including the value of collateral securing loans; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | ability to weather the current economic downturn; |
|--------------------|---------------------------------------------------|

| ·   | loss of consumer or investor confidence; |
|--------------------|------------------------------------------|

| ·   | availability of liquidity sources; |
|--------------------|------------------------------------|

| ·   | the risks of opening new offices, including, without limitation, the related costs and time of building customer relationships and integrating operations as part of these endeavors and the failure to achieve expected gains, revenue growth and/or expense savings from such endeavors; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | changes in laws and regulations, including tax, banking and securities laws and regulations; |
|--------------------|----------------------------------------------------------------------------------------------|

| ·   | changes in the requirements of regulatory authorities; |
|--------------------|--------------------------------------------------------|

| ·   | changes in accounting policies, rules and practices; |
|--------------------|------------------------------------------------------|

| ·   | cost and difficulty of implementing changes in technology or products; |
|--------------------|------------------------------------------------------------------------|

| ·   | the effects of war or other conflicts, acts of terrorism or other catastrophic events that may affect general economic conditions and economic confidence; and |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | other factors and information described in this report and in any of  the other reports that we file with the Securities and Exchange Commission under the Securities Exchange Act of 1934. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                        |         | 2010 |   |   | 2009   |   |
|---------------------------------------------|--------------|------|--------|--------|--------|--------|
| Quarter Ended      |    | High |   |   | Low    |   |   | High |   |   | Low |   |
| March 31                                    |         | $    | 7.21   |   |   | $      | 6.52 |   |   | $ | 9.52 |   |   | $ | 2.95 |   |
| June 30                                     |         | $    | 7.05   |   |   | $      | 6.00 |   |   | $ | 7.14 |   |   | $ | 3.14 |   |
| September 30                                |         | $    | 6.40   |   |   | $      | 6.40 |   |   | $ | 10.48 |   |   | $ | 6.19 |   |
| December 31                                 |         | $    | 5.95   |   |   | $      | 5.95 |   |   | $ | 7.62 |   |   | $ | 6.67 |   |

----

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|                                     |   |                     |    |       |   |       |    |   |        |   |    |   |   |    |    |        |   |    |   |   |    |   |   |   |   |   |    |
|------------------------------------------|--------|--------------------------|---------|------------|--------|------------|---------|--------|-------------|--------|---------|--------|--------|---------|---------|-------------|--------|---------|--------|--------|---------|--------|--------|--------|--------|--------|---------|
|                                     |   |                     |    |       |   |       |    |   |        |   |    |   |   |    |    |        |   |    |   |   |    |   |   |   |   |   |    |
|                                     |   | Years Ended December 31, |
|                                     |   |  2010               |    |  2009 |   |  2008 |
|                                     |   | Average                  |    | Income/    |   |       | Yields/ |   | Average     |   | Income/ |   |   | Yields/ |    | Average     |   | Income/ |   |   | Yields/ |
|                                     |   | Balances(1)              |    | Expense    |   |       | Rates   |   | Balances(1) |   | Expense |   |   | Rates   |    | Balances(1) |   | Expense |   |   | Rates   |
|                                     |   | (Dollars in thousands)   |
| Assets                                   |   |                     |    |       |   |       |    |   |        |   |    |   |   |    |    |        |   |    |   |   |    |   |   |   |   |   |    |
| Interest bearing deposits due from banks |   | $                        | 48,508  |       |   | $          | 118     |   |        |   | 0.24    | %      |   | $       | 20,906  |        |   | $       | 47     |   |    |   | 0.22   | %      |   | $      | 995     |   |   | $ | 18 |   |   |   | 1.81 | % |
| Taxable securities                       |   |                     | 159,608 |       |   |       | 5,016   |   |        |   | 3.14    | %      |   |    | 136,619 |        |   |    | 5,569  |   |    |   | 4.08   | %      |   |   | 100,395 |   |   |   | 4,808 |   |   |   | 4.79 | % |
| Tax-exempt securities (2)                |   |                     | 18,757  |       |   |       | 763     |   |        |   | 4.07    | %      |   |    | 19,912  |        |   |    | 811    |   |    |   | 4.07   | %      |   |   | 20,699  |   |   |   | 833 |   |   |   | 4.02 | % |
| Federal funds sold                       |   |                     | -       |       |   |       | -       |   |        |   | 0.00    | %      |   |    | 1,981   |        |   |    | 3      |   |    |   | 0.15   | %      |   |   | 25,579  |   |   |   | 632 |   |   |   | 2.47 | % |
| Federal Home Loan Bank stock             |   |                     | 1,262   |       |   |       | 4       |   |        |   | 0.32    | %      |   |    | 1,289   |        |   |    | 4      |   |    |   | 0.31   | %      |   |   | 1,053   |   |   |   | 48 |   |   |   | 4.56 | % |
| Loans (2) (3) (4)                        |   |                     | 262,120 |       |   |       | 15,939  |   |        |   | 6.08    | %      |   |    | 272,330 |        |   |    | 16,517 |   |    |   | 6.07   | %      |   |   | 259,055 |   |   |   | 18,212 |   |   |   | 7.03 | % |
| Total interest earning assets            |   |                     | 490,255 |       |   |       | 21,840  |   |        |   | 4.45    | %      |   |    | 453,037 |        |   |    | 22,951 |   |    |   | 5.07   | %      |   |   | 407,776 |   |   |   | 24,551 |   |   |   | 6.02 | % |
| Cash and due from banks                  |   |                     | 1,940   |       |   |       |    |   |        |   |    |   |   |    | 5,598   |        |   |    |   |   |    |   |   |   |   |   | 8,913   |   |   |   |   |   |   |   |   |   |
| Allowance for loan losses                |   |                     | (6,177  | )          |   |       |    |   |        |   |    |   |   |    | (5,461  | )           |   |    |   |   |    |   |   |   |   |   | (3,038  | ) |   |   |   |   |   |   |   |   |
| Unrealized securities gains (losses)     |   |                     | 2,640   |       |   |       |    |   |        |   |    |   |   |    | 1,432   |        |   |    |   |   |    |   |   |   |   |   | (64     | ) |   |   |   |   |   |   |   |   |
| Premises and equipment                   |   |                     | 8,325   |       |   |       |    |   |        |   |    |   |   |    | 8,588   |        |   |    |   |   |    |   |   |   |   |   | 8,774   |   |   |   |   |   |   |   |   |   |
| Other assets                             |   |                     | 25,394  |       |   |       |    |   |        |   |    |   |   |    | 16,712  |        |   |    |   |   |    |   |   |   |   |   | 12,578  |   |   |   |   |   |   |   |   |   |
| Total assets                             |   | $                        | 522,377 |       |   |       |    |   |        |   |    |   |   | $       | 479,906 |        |   |    |   |   |    |   |   |   |   | $      | 434,939 |   |   |   |   |   |   |   |   |   |
|                                     |   |                     |    |       |   |       |    |   |        |   |    |   |   |    |    |        |   |    |   |   |    |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Liabilities and shareholders' equity     |   |                     |    |       |   |       |    |   |        |   |    |   |   |    |    |        |   |    |   |   |    |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Interest bearing deposits                |   |                     |    |       |   |       |    |   |        |   |    |   |   |    |    |        |   |    |   |   |    |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Interest bearing transaction accounts    |   | $                        | 57,413  |       |   | $          | 320     |   |        |   | 0.56    | %      |   | $       | 54,202  |        |   | $       | 370    |   |    |   | 0.68   | %      |   | $      | 57,416  |   |   | $ | 1,049 |   |   |   | 1.83 | % |
| Savings                                  |   |                     | 26,374  |       |   |       | 99      |   |        |   | 0.38    | %      |   |    | 21,093  |        |   |    | 80     |   |    |   | 0.38   | %      |   |   | 25,181  |   |   |   | 340 |   |   |   | 1.35 | % |
| Time deposits $100M and over             |   |                     | 146,361 |       |   |       | 3,027   |   |        |   | 2.07    | %      |   |    | 131,115 |        |   |    | 3,752  |   |    |   | 2.86   | %      |   |   | 111,780 |   |   |   | 4,326 |   |   |   | 3.87 | % |
| Other time deposits                      |   |                     | 189,751 |       |   |       | 4,822   |   |        |   | 2.54    | %      |   |    | 173,047 |        |   |    | 6,268  |   |    |   | 3.62   | %      |   |   | 148,295 |   |   |   | 6,839 |   |   |   | 4.61 | % |
| Total interest bearing                   |   |                     |    |       |   |       |    |   |        |   |    |   |   |    |    |        |   |    |   |   |    |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
|     deposits              |   |                     | 419,899 |       |   |       | 8,268   |   |        |   | 1.97    | %      |   |    | 379,457 |        |   |    | 10,470 |   |    |   | 2.76   | %      |   |   | 342,672 |   |   |   | 12,554 |   |   |   | 3.66 | % |
| Short-term borrowings                    |   |                     | 14      |       |   |       | -       |   |        |   | 0.00    | %      |   |    | 437     |        |   |    | 47     |   |    |   | 10.76  | %      |   |   | 1,219   |   |   |   | 11 |   |   |   | 0.90 | % |
| Long-term debt                           |   |                     | 7,211   |       |   |       | 285     |   |        |   | 3.95    | %      |   |    | 9,463   |        |   |    | 366    |   |    |   | 3.87   | %      |   |   | 6,615   |   |   |   | 269 |   |   |   | 4.07 | % |
| Total interest bearing liabilities       |   |                     | 427,124 |       |   |       | 8,553   |   |        |   | 2.00    | %      |   |    | 389,357 |        |   |    | 10,883 |   |    |   | 2.80   | %      |   |   | 350,506 |   |   |   | 12,834 |   |   |   | 3.66 | % |
| Noninterest bearing demand deposits      |   |                     | 44,929  |       |   |       |    |   |        |   |    |   |   |    | 44,243  |        |   |    |   |   |    |   |   |   |   |   | 41,173  |   |   |   |   |   |   |   |   |   |
| Other liabilities                        |   |                     | 3,983   |       |   |       |    |   |        |   |    |   |   |    | 4,667   |        |   |    |   |   |    |   |   |   |   |   | 3,583   |   |   |   |   |   |   |   |   |   |
| Shareholders' equity                     |   |                     | 46,341  |       |   |       |    |   |        |   |    |   |   |    | 41,639  |        |   |    |   |   |    |   |   |   |   |   | 39,677  |   |   |   |   |   |   |   |   |   |
| Total liabilities and shareholders'      |   |                     |    |       |   |       |    |   |        |   |    |   |   |    |    |        |   |    |   |   |    |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
|    equity                      |   | $                        | 522,377 |       |   |       |    |   |        |   |    |   |   | $       | 479,906 |        |   |    |   |   |    |   |   |   |   | $      | 434,939 |   |   |   |   |   |   |   |   |   |
| Interest rate spread  (5)      |   |                     |    |       |   |       |    |   |        |   | 2.45    | %      |   |    |    |        |   |    |   |   |    |   | 2.27   | %      |   |   |    |   |   |   |   |   |   |   | 2.36 | % |
| Net interest income and net yield        |   |                     |    |       |   |       |    |   |        |   |    |   |   |    |    |        |   |    |   |   |    |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
| on earning assets  (6)         |   |                     |    |       |   | $          | 13,287  |   |        |   | 2.71    | %      |   |    |    |        |   | $       | 12,068 |   |    |   | 2.66   | %      |   |   |    |   |   | $ | 11,717 |   |   |   | 2.87 | % |
| Interest free funds supporting earning   |   |                     |    |       |   |       |    |   |        |   |    |   |   |    |    |        |   |    |   |   |    |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
| assets  (7)                    |   | $                        | 63,131  |       |   |       |    |   |        |   |    |   |   | $       | 63,680  |        |   |    |   |   |    |   |   |   |   | $      | 57,270  |   |   |   |   |   |   |   |   |   |

| (1) | Average balances are computed on a daily basis.                                                                              |
|-----|------------------------------------------------------------------------------------------------------------------------------|
| (2) | Income and yields on tax-exempt securities and loans have not been adjusted on a tax equivalent basis.                       |
| (3) | Nonaccrual loans are included in the average loan balances and income on such loans generally is recognized on a cash basis. |
| (4) | Includes immaterial amounts of loan fees.                                                                                    |
| (5) | Total interest earning assets yield less the total interest bearing liabilities rate.                                        |
| (6) | Net interest income divided by total interest earning assets.                                                                |
| (7) | Total interest earning assets less total interest bearing liabilities.                                                       |

----

|                                                            |   |   |                    |   |   |                    |   |   |   |   |   |       |   |   |     |   |   |   |
|-----------------------------------------------------------------|--------|--------|-------------------------|--------|--------|-------------------------|--------|--------|--------|--------|--------|------------|--------|--------|----------|--------|--------|--------|
|                                                            |   |   |                    |   |   |                    |   |   |   |   |   |       |   |   |     |   |   |   |   |
|                                                            |   |   | 2010 Compared with 2009 |   |   | 2009 Compared with 2008 |   |
|                                                            |   |   | Volume (1)              |   |   | Rate (1)                |   |   | Total  |   |   | Volume (1) |   |   | Rate (1) |   |   | Total  |   |
|                                                            |   |   | (Dollars in thousands)  |
| Interest bearing deposits due     from banks     |   | $      | 67                      |   |   | $                       | 4      |   |   | $      | 71     |       |   | $      | 58       |   |   | $      | (29 | ) |   | $ | 29 |   |
| Taxable securities                                              |   |   | 846                     |   |   |                    | (1,399 | )      |   |   | (553   | )          |   |   | 1,552    |   |   |   | (791 | ) |   |   | 761 |   |
| Tax-exempt securities                                           |   |   | (47                     | )      |   |                    | (1     | )      |   |   | (48    | )          |   |   | (32      | )      |   |   | 10 |   |   |   | (22 | ) |
| Federal funds sold                                              |   |   | (3                      | )      |   |                    | -      |   |   |   | (3     | )          |   |   | (312     | )      |   |   | (317 | ) |   |   | (629 | ) |
| Federal Home Loan Bank stock                                    |   |   | -                       |   |   |                    | -      |   |   |   | -      |       |   |   | 9        |   |   |   | (53 | ) |   |   | (44 | ) |
| Loans                                                           |   |   |                    | (621   | )      |                    |   | 43     |   |   |   | (578       | )      |   |     | 898    |   |   |   | (2,593 | ) |   |   | (1,695 | ) |
|        Total interest income |   |   |                    | 242    |   |                    |   | (1,353 | )      |   |   | (1,111     | )      |   |     | 2,173  |   |   |   | (3,773 | ) |   |   | (1,600 | ) |
| Interest bearing deposits                                       |   |   |                    |   |   |                    |   |   |   |   |   |       |   |   |     |   |   |   |   |   |   |   |   |   |
| Interest bearing transaction accounts                           |   |   | 21                      |   |   |                    | (71    | )      |   |   | (50    | )          |   |   | (56      | )      |   |   | (623 | ) |   |   | (679 | ) |
| Savings                                                         |   |   |                    | 20     |   |                    |   | (1     | )      |   |   | 19         |   |   |     | (48    | )      |   |   | (212 | ) |   |   | (260 | ) |
| Time deposits $100M and over                                    |   |   | 401                     |   |   |                    | (1,126 | )      |   |   | (725   | )          |   |   | 670      |   |   |   | (1,244 | ) |   |   | (574 | ) |
| Other time deposits                                             |   |   | 561                     |   |   |                    | (2,007 | )      |   |   | (1,446 | )          |   |   | 1,034    |   |   |   | (1,605 | ) |   |   | (571 | ) |
| Short-term borrowings                                           |   |   | (23                     | )      |   |                    | (24    | )      |   |   | (47    | )          |   |   | (11      | )      |   |   | 47 |   |   |   | 36 |   |
| Long-term debt                                                  |   |   | (89                     | )      |   |                    | 8      |   |   |   | (81    | )          |   |   | 111      |   |   |   | (14 | ) |   |   | 97 |   |
|     Total interest expense                  |   |   | 891                     |   |   |                    | (3,221 | )      |   |   | (2,330 | )          |   |   | 1,700    |   |   |   | (3,651 | ) |   |   | (1,951 | ) |
|     Net interest income                     |   | $      | (649                    | )      |   | $                       | 1,868  |   |   | $      | 1,219  |       |   | $      | 473      |   |   | $      | (122 | ) |   | $ | 351 |   |
|                                                            |   |   |                    |   |   |                    |   |   |   |   |   |       |   |   |     |   |   |   |   |   |   |   |   |   |   |

| (1)   | The rate/volume variance for each category has been allocated on a consistent basis between rate and volume variances based on the percentage of rate or volume variance to the sum of the two absolute variances except in categories having balances in only one period.  In such cases, the entire variance is attributed to volume variances. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                     |   |                   |     |   |   |   |     |     |   |   |     |   |   |   |    |
|------------------------------------------|--------|------------------------|----------|--------|--------|--------|----------|----------|--------|--------|----------|--------|--------|--------|---------|
|                                     |   |                   |     |   |   |   |     |     |   |   |     |   |   |   |    |
|                                     |   | December 31, 2010      |     |
|                                     |   | Within                 |     |   | 4-12   |   |     | Over 1-5 |   |   | Over 5   |   |   |   |    |
|                                     |   | 3 Months               |     |   | Months |   |     | Years    |   |   | Years    |   |   | Total  |    |
|                                     |   | (Dollars in thousands) |
| Interest earning assets                  |   |                   |     |   |   |   |     |     |   |   |     |   |   |   |    |   |
| Interest bearing deposits due from banks |   | $                      | 39,171   |   |   | $      | -        |     |   | $      | -        |   |   | $      | -       |   |   | $ | 39,171 |   |
| Securities                               |   |                   | 369      |   |   |   | 632      |     |   |   | 36,672   |   |   |   | 138,085 |   |   |   | 175,758 |   |
| Federal Home Loan Bank stock             |   |                   | 1,363    |   |   |   | -        |     |   |   | -        |   |   |   | -       |   |   |   | 1,363 |   |
| Loans (1)                                |   |                   | 50,192   |   |   |   | 30,517   |     |   |   | 146,761  |   |   |   | 13,020  |   |   |   | 240,490 |   |
| Total interest earning assets            |   |                   | 91,095   |   |   |   | 31,149   |     |   |   | 183,433  |   |   |   | 151,105 |   |   | $ | 456,782 |   |
|                                     |   |                   |     |   |   |   |     |     |   |   |     |   |   |   |    |   |   |   |   |   |
| Interest bearing liabilities             |   |                   |     |   |   |   |     |     |   |   |     |   |   |   |    |   |   |   |   |   |
| Interest bearing deposits                |   |                   |     |   |   |   |     |     |   |   |     |   |   |   |    |   |   |   |   |   |
| Interest bearing transaction accounts    |   | $                      | 65,655   |   |   | $      | -        |     |   | $      | -        |   |   | $      | -       |   |   | $ | 65,655 |   |
| Savings                                  |   |                   | 28,644   |   |   |   | -        |     |   |   | -        |   |   |   | -       |   |   |   | 28,644 |   |
| Time deposits $100M and over             |   |                   | 44,320   |   |   |   | 53,272   |     |   |   | 32,653   |   |   |   | -       |   |   |   | 130,245 |   |
| Other time deposits                      |   |                   | 54,235   |   |   |   | 79,116   |     |   |   | 40,571   |   |   |   | -       |   |   |   | 173,922 |   |
| Short-term borrowings                    |   |                   | 5,000    |   |   |   | -        |     |   |   | -        |   |   |   | -       |   |   |   | 5,000 |   |
| Long-term debt                           |   |                   | 3,500    |   |   |   | 1,500    |     |   |   | 1,500    |   |   |   | -       |   |   |   | 6,500 |   |
| Total interest bearing liabilities       |   |                   | 201,354  |   |   |   | 133,888  |     |   |   | 74,724   |   |   |   | -       |   |   | $ | 409,966 |   |
|                                     |   |                   |     |   |   |   |     |     |   |   |     |   |   |   |    |   |   |   |   |   |
| Interest sensitivity gap                 |   | $                      | (110,259 | )      |   | $      | (102,739 | )        |   | $      | 108,709  |   |   | $      | 151,105 |   |   |   |   |   |
| Cumulative interest sensitivity gap      |   | $                      | (110,259 | )      |   | $      | (212,998 | )        |   | $      | (104,289 | )      |   | $      | 46,816  |   |   |   |   |   |
| Gap ratio                                |   |                   | 0.45     |   |   |   | 0.23     |     |   |   |     |   |   |   |    |   |   |   |   |   |
| Cumulative gap ratio                     |   |                   | 0.45     |   |   |   | 0.36     |     |   |   |     |   |   |   |    |   |   |   |   |   |
|                                     |   |                   |     |   |   |   |     |     |   |   |     |   |   |   |    |   |   |   |   |   |

----

----

| Securities Portfolio Composition          |   |                   |    |   |   |   |    |   |   |
|-------------------------------------------|--------|------------------------|---------|--------|--------|--------|---------|--------|--------|
|                                      |   |                   |    |   |   |   |    |   |   |
|                                      |   | December 31,           |    |
|                                      |   | 2010                   |    |   | 2009   |   |    | 2008   |   |
|                                      |   | (Dollars in thousands) |    |
| Available-for-sale                        |   |                   |    |   |   |   |    |   |   |
| Mortgage-backed securities issued by      |   |                   |    |   |   |   |    |   |   |
| US Government agencies                    |   | $                      | 1,180   |   |   | $      | 1,475   |   |   | $ | 1,829 |   |
| Government-sponsored enterprises (GSEs)   |   |                   | 129,860 |   |   |   | 86,963  |   |   |   | 63,981 |   |
| Mortgage-backed securities issued by GSEs |   |                   | 21,128  |   |   |   | 33,702  |   |   |   | 41,357 |   |
| State, county and municipal               |   |                   | 17,201  |   |   |   | 19,570  |   |   |   | 19,469 |   |
| Total available-for-sale                  |   |                   | 169,369 |   |   |   | 141,710 |   |   |   | 126,636 |   |
| Held-to-maturity                          |   |                   |    |   |   |   |    |   |   |   |   |   |
| Mortgage-backed securities issued by GSEs |   |                   | 6,389   |   |   |   | 9,024   |   |   |   | 11,910 |   |
| Total securities                          |   | $                      | 175,758 |   |   | $      | 150,734 |   |   | $ | 138,546 |   |

----

|                        |   | WithinOne Year         |   | AfterOne YearThroughFive Years |   | After Five YearsThroughTen Years |   |   | AfterTen Years |   | Total  |
|-----------------------------|--------|------------------------|--------|--------------------------------|--------|----------------------------------|--------|--------|----------------|--------|--------|
|                        |   | Amount                 |   |                           | Yield  |                             | Amount |   |           | Yield  |   | Amount |   |   | Yield |   |   | Amount |   |   | Yield |   | Amount |   |   | Yield |
|                        |   | (Dollars in thousands) |   |
| Mortgage-backed securities  |   |                   |   |                           |   |                             |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| issued by US Government     |   |                   |   |                           |   |                             |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| agencies (1)                |   | $                      | -      |                           |   |                             | 0.00   | %      |           | $      | -      |   |   |   | 0.00 | % |   | $ | 1,180 |   |   |   | 4.31 | % |   | $ | - |   |   |   | 0.00 | % |   | $ | 1,180 |   |   |   | 4.31 | % |
| Government-sponsored        |   |                   |   |                           |   |                             |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| enterprises (GSEs)          |   |                   | -      |                           |   |                             | 0.00   | %      |           |   | 34,990 |   |   |   | 1.69 | % |   |   | 49,501 |   |   |   | 2.19 | % |   |   | 45,369 |   |   |   | 3.17 | % |   |   | 129,860 |   |   |   | 2.40 | % |
| Mortgage-backed securities  |   |                   |   |                           |   |                             |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| issued by GSEs (1)          |   |                   | 703    |                           |   |                             | 3.92   | %      |           |   | 1,148  |   |   |   | 3.75 | % |   |   | 6,646 |   |   |   | 4.61 | % |   |   | 19,020 |   |   |   | 4.41 | % |   |   | 27,517 |   |   |   | 4.42 | % |
| State, county and municipal |   |                   | -      |                           |   |                             | 0.00   | %      |           |   | 534    |   |   |   | 3.96 | % |   |   | 4,261 |   |   |   | 4.08 | % |   |   | 12,406 |   |   |   | 4.09 | % |   |   | 17,201 |   |   |   | 4.08 | % |
| Total                       |   | $                      | 703    |                           |   |                             | 3.92   | %      |           | $      | 36,672 |   |   |   | 1.79 | % |   | $ | 61,588 |   |   |   | 2.62 | % |   | $ | 76,795 |   |   |   | 3.63 | % |   | $ | 175,758 |   |   |   | 2.89 | % |

| (1)   | Maturity categories based upon final stated maturity dates.  Average maturity is substantially shorter because of the monthly return of principal on certain securities. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|                                 |        |   |                   |    |   |   |    |    |   |   |    |    |   |   |    |
|--------------------------------------|-------------|--------|------------------------|---------|--------|--------|---------|---------|--------|--------|---------|---------|--------|--------|---------|
|                                 |        |   |                   |    |   |   |    |    |   |   |    |    |   |   |    |   |
|                                 |        |   | December 31,           |    |
|                                 |        |   | 2010                   |    |   | 2009   |    |    | 2008   |   |    | 2007    |   |   | 2006    |   |
|                                 |        |   | (Dollars in thousands) |    |
| Commercial, financial and industrial |        |   |                   |    |   |   |    |    |   |   |    |    |   |   |
| Commercial and industrial            |        | $      | 20,351                 |    |   | $      | 21,511  |    |   | $      | 21,372  |    |   | $      | 22,042  |   |   | $ | 22,268 |   |
| Purchasing or carrying securities    |        |   | 123                    |    |   |   | 1,598   |    |   |   | 1,815   |    |   |   | 1,823   |   |   |   | 2,000 |   |
| Real estate - construction           |        |   | 23,730                 |    |   |   | 29,439  |    |   |   | 30,451  |    |   |   | 2,201   |   |   |   | 1,982 |   |
| Real estate - mortgage               |        |   |                   |    |   |   |    |    |   |   |    |    |   |   |    |   |   |   |   |   |
| 1-4 family residential               |        |   | 103,010                |    |   |   | 108,293 |    |   |   | 109,153 |    |   |   | 131,944 |   |   |   | 98,708 |   |
| Multifamily (5 or more) residential  |        |   | 2,414                  |    |   |   | 2,899   |    |   |   | 66      |    |   |   | 2,421   |   |   |   | 1,900 |   |
| Nonfarm, nonresidential              |        |   | 82,516                 |    |   |   | 73,282  |    |   |   | 73,450  |    |   |   | 50,833  |   |   |   | 47,337 |   |
| Consumer installment                 |        |   |                   |    |   |   |    |    |   |   |    |    |   |   |    |   |   |   |   |   |
| Credit card and checking credit      |        |   | 1,630                  |    |   |   | 1,643   |    |   |   | 1,517   |    |   |   | 1,407   |   |   |   | 1,334 |   |
| Other                                |        |   |                   | 23,060  |   |   |    | 28,583  |   |   |    | 32,589  |   |   |    | 31,460 |   |   |   | 27,437 |   |
|                                 | Total loans |   | $                      | 256,834 |   |   | $       | 267,248 |   |   | $       | 270,413 |   |   | $       | 244,131 |   |   | $ | 202,966 |   |
|                                 |        |   |                   |    |   |   |    |    |   |   |    |    |   |   |    |   |   |   |   |   |   |
|                                 |        |   |                   |    |   |   |    |    |   |   |    |    |   |   |    |   |   |   |   |   |   |

|                                 |   |   | December 31, |
|--------------------------------------|--------|--------|--------------|
|                                 |   |   |         | 2010 |   |   |   | 2009 |   |   |   | 2008 |   |   |   | 2007 |   |   |   | 2006 |   |
| Commercial, financial and industrial |   |   |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial and industrial            |   |   | 7.9          | % |   |   | 8.0 | % |   |   | 7.9 | % |   |   | 9.0 | % |   |   | 11.0 | % |
| Purchasing or carrying securities    |   |   | 0.0          | % |   |   | 0.6 | % |   |   | 0.7 | % |   |   | 0.8 | % |   |   | 1.0 | % |
| Real estate - construction           |   |   | 9.3          | % |   |   | 11.0 | % |   |   | 11.2 | % |   |   | 0.9 | % |   |   | 1.0 | % |
| Real estate - mortgage               |   |   |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 1-4 family residential               |   |   | 40.1         | % |   |   | 40.5 | % |   |   | 40.4 | % |   |   | 54.0 | % |   |   | 48.6 | % |
| Multifamily (5 or more) residential  |   |   | 0.9          | % |   |   | 1.1 | % |   |   | 0.0 | % |   |   | 1.0 | % |   |   | 0.9 | % |
| Nonfarm, nonresidential              |   |   | 32.2         | % |   |   | 27.5 | % |   |   | 27.2 | % |   |   | 20.8 | % |   |   | 23.3 | % |
| Consumer installment                 |   |   |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Credit card and checking credit      |   |   | 0.6          | % |   |   | 0.6 | % |   |   | 0.6 | % |   |   | 0.6 | % |   |   | 0.7 | % |
| Other                                |   |   |         | 9.0 | % |   |   | 10.7 | % |   |   | 12.0 | % |   |   | 12.9 | % |   |   | 13.5 | % |
| Total loans                          |   |   | 100.0        | % |   |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |

----

----

|                                 |        |   | December 31, 2010      |   |
|--------------------------------------|-------------|--------|------------------------|--------|
|                                 |        |   | Due inOne Yearor Less  |   |   | Due afterOne throughFive Years |   |   | Due afterFive Years |   |   | Total |   |
|                                 |        |   | (Dollars in thousands) |   |
|                                 |        |   |                   |   |   |   |   |   |   |   |   |   |   |
| Commercial, financial and industrial |        | $      | 9,541                  |   |   | $ | 10,044 |   |   | $ | 889 |   |   | $ | 20,474 |   |
| Real estate - construction           |        |   | 14,101                 |   |   |   | 8,068 |   |   |   | 1,561 |   |   |   | 23,730 |   |
| Real estate - mortgage               |        |   | 37,665                 |   |   |   | 103,840 |   |   |   | 46,435 |   |   |   | 187,940 |   |
| Consumer installment                 |        |   | 6,646                  |   |   |   | 16,204 |   |   |   | 1,840 |   |   |   | 24,690 |   |
|                                 | Total loans |   | $                      | 67,953 |   |   | $ | 138,156 |   |   | $ | 50,725 |   |   | $ | 256,834 |   |
|                                 |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Maturity greater than one year:      |        |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Predetermined rate                   |        |   |                   |   |   |   |   |   |   |   |   |   |   | $ | 142,895 |   |
| Variable rate                        |        |   |                   |   |   |   |   |   |   |   |   |   |   |   | $ | 45,986 |   |

|                                    |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |
|-----------------------------------------|--------|--------|------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                    |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                    |   |   | December 31,           |   |
|                                    |   |   | 2010                   |   |   | 2009   |   |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|                                    |   |   | (Dollars in thousands) |   |
|                                    |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Nonaccrual loans                        |   | $      | 16,344                 |   |   | $      | 13,870 |   |   | $      | 11,799 |   |   | $      | 625    |   |   | $ | 50 |   |
| Accruing loans 90 days or more past due |   |   | -                      |   |   |   | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |
| Other                                   |   |   |                   | 4,175  |   |   |   | 3,478  |   |   |   | -      |   |   |   | - |   |   |   | - |   |
|                                    | Total  |   | $                      | 20,519 |   |   | $      | 17,348 |   |   | $      | 11,799 |   |   | $      | 625 |   |   | $ | 50 |   |
|                                    |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Percent of total loans                  |   |   | 8.0                    | %      |   |   | 6.5    | %      |   |   | 4.4    | %      |   |   | 0.3    | % |   |   | 0.0 | % |

----

|                 |   |   | December 31, 2010      |   |
|----------------------|--------|--------|------------------------|--------|
|                 |   |   | Amount                 |   |   | % |   |
|                 |   |   | (Dollars in thousands) |   |
|                 |   |   |                   |   |   |   |   |
| Real estate mortgage |   | $      | 15,364                 |   |   |   | 88.5 | % |
| Vehicles             |   |   |                   | 602    |   |   |   | 3.5 | % |
| Mobile homes         |   |   | 230                    |   |   |   | 1.3 | % |
| Other                |   |   |                   | 762    |   |   |   | 4.4 | % |
| Unsecured            |   |   |                   | 408    |   |   |   | 2.3 | % |
|                 | Total  |   | $                      | 17,366 |   |   |   | 100.0 | % |

----

|                                                                                                                   |   |                     |    |   |   |   |    |   |   |   |    |   |   |   |    |
|------------------------------------------------------------------------------------------------------------------------|--------|--------------------------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|
|                                                                                                                   |   | Years Ended December 31, |    |
|                                                                                                                   |   | 2010                     |    |   | 2009   |   |    | 2008   |   |   | 2007    |   |   | 2006   |    |
|                                                                                                                   |   | (Dollars in thousands)   |    |
|                                                                                                                   |   |                     |    |   |   |   |    |   |   |   |    |   |   |   |    |
| Total loans outstanding at end of period                                                                               |   | $                        | 256,834 |   |   | $      | 267,248 |   |   | $      | 270,413 |   |   | $      | 244,131 |   |   | $ | 202,966 |   |
| Average amount of loans outstanding                                                                                    |   |                     | 262,120 |   |   |   | 272,330 |   |   |   | 259,055 |   |   |   | 224,353 |   |   |   | 184,032 |   |
|                                                                                                                   |   |                     |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Balance of allowance for loan losses - beginning                                                                       |   | $                        | 6,052   |   |   | $      | 5,475   |   |   | $      | 2,574   |   |   | $      | 2,242   |   |   | $ | 2,266 |   |
| Loans charged off                                                                                                      |   |                     |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Commercial and industrial                                                                                              |   |                     | 327     |   |   |   | 846     |   |   |   | 652     |   |   |   | 88      |   |   |   | 13 |   |
| Real estate - mortgage                                                                                                 |   |                     | 3,932   |   |   |   | 1,866   |   |   |   | 667     |   |   |   | 13      |   |   |   | 6 |   |
| Consumer installment                                                                                                   |   |                     | 702     |   |   |   | 1,174   |   |   |   | 347     |   |   |   | 191     |   |   |   | 115 |   |
| Total charge-offs                                                                                                      |   |                     | 4,961   |   |   |   | 3,886   |   |   |   | 1,666   |   |   |   | 292     |   |   |   | 134 |   |
| Recoveries of loans previously charged off                                                                             |   |                     |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Commercial and industrial                                                                                              |   |                     | 3       |   |   |   | 6       |   |   |   | 5       |   |   |   | -       |   |   |   | - |   |
| Real estate - mortgage                                                                                                 |   |                     | 26      |   |   |   | -       |   |   |   | -       |   |   |   | -       |   |   |   | 31 |   |
| Consumer installment                                                                                                   |   |                     | 111     |   |   |   | 102     |   |   |   | 12      |   |   |   | 30      |   |   |   | 14 |   |
| Total recoveries                                                                                                       |   |                     | 140     |   |   |   | 108     |   |   |   | 17      |   |   |   | 30      |   |   |   | 45 |   |
| Net charge-offs                                                                                                        |   |                     | 4,821   |   |   |   | 3,778   |   |   |   | 1,649   |   |   |   | 262     |   |   |   | 89 |   |
| Additions to allowance charged to expense                                                                              |   |                     | 4,525   |   |   |   | 4,355   |   |   |   | 4,550   |   |   |   | 594     |   |   |   | 65 |   |
| Balance of allowance for loan losses - ending                                                                          |   | $                        | 5,756   |   |   | $      | 6,052   |   |   | $      | 5,475   |   |   | $      | 2,574   |   |   | $ | 2,242 |   |
|                                                                                                                   |   |                     |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Ratios                                                                                                                 |   |                     |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
|     Net charge-offs to average loans                                                                    |   |                     | 1.84    | %      |   |   | 1.39    | %      |   |   | 0.64    | %      |   |   | 0.12    | % |   |   | 0.05 | % |
|     Net charge-offs to loans at end of period                                                           |   |                     | 1.88    | %      |   |   | 1.41    | %      |   |   | 0.61    | %      |   |   | 0.11    | % |   |   | 0.04 | % |
|     Allowance for loan losses to average loans                                                          |   |                     | 2.20    | %      |   |   | 2.22    | %      |   |   | 2.11    | %      |   |   | 1.15    | % |   |   | 1.22 | % |
|     Allowance for loan losses to loans         at end of period |   |                     | 2.24    | %      |   |   | 2.26    | %      |   |   | 2.02    | %      |   |   | 1.05    | % |   |   | 1.10 | % |
| Net charge-offs to allowance for loan losses                                                                           |   |                     | 83.76   | %      |   |   | 62.43   | %      |   |   | 30.12   | %      |   |   | 10.18   | % |   |   | 3.97 | % |
| Net charge-offs to provision for loan losses                                                                           |   |                     | 106.54  | %      |   |   | 86.75   | %      |   |   | 36.24   | %      |   |   | 44.11   | % |   |   | 136.92 | % |

|                                                                |           |   |                     |    |   |   |   |   |   |   |    |    |   |   |   |   |   |   |
|---------------------------------------------------------------------|----------------|--------|--------------------------|---------|--------|--------|--------|--------|--------|--------|---------|---------|--------|--------|--------|--------|--------|--------|
|                                                                |           |   |                     |    |   |   |   |   |   |   |    |    |   |   |   |   |   |   |   |
|                                                                |           |   | Years Ended December 31, |    |
|                                                                |           |   | 2010                     |    |   | 2009   |   |   | 2008   |   |
|                                                                |           |   | Amount                   |    |   | %      |   |   | Amount |   |    | %       |   |   | Amount |   |   | %      |   |
|                                                                |           |   | (Dollars in thousands)   |
|                                                                |           |   |                     |    |   |   |   |   |   |   |    |    |   |   |   |   |   |   |   |
| Noninterest bearing demand                                          |           | $      | 44,929                   |    |   |   | 9.7    | %      |   | $      | 44,243  |    |   |   | 10.4   | %      |   | $      | 41,173 |   |   |   | 10.7 | % |
| Interest bearing transaction      accounts |           |   | 57,413                   |    |   |   | 12.3   | %      |   |   | 54,202  |    |   |   | 12.8   | %      |   |   | 57,416 |   |   |   | 15.0 | % |
| Savings                                                             |           |   |                     | 26,374  |   |   |   | 5.7    | %      |   |    | 21,093  |   |   |   | 5.0    | %      |   |   | 25,181 |   |   |   | 6.6 | % |
| Time deposits $100 and over                                         |           |   | 146,361                  |    |   |   | 31.5   | %      |   |   | 131,115 |    |   |   | 31.0   | %      |   |   | 111,780 |   |   |   | 29.1 | % |
| Other time deposits                                                 |           |   | 189,751                  |    |   |   | 40.8   | %      |   |   | 173,047 |    |   |   | 40.8   | %      |   |   | 148,295 |   |   |   | 38.6 | % |
|                                                                | Total deposits |   | $                        | 464,828 |   |   |   | 100.0  | %      |   | $       | 423,700 |   |   |   | 100.0  | %      |   | $ | 383,845 |   |   |   | 100.0 | % |

----

|   |   | Years Ended December 31, |   |
|--------|--------|--------------------------|--------|
|   |   | 2010                     |   |   | 2009 |   |   | 2008 |   |
|   |   |                     |   |   |   |   |   |   |   |

| Return on assets       |   |   | 0.21 | % |   |   | 0.23 | % |   |   | 0.31 | % |
|------------------------|--------|--------|------|---|--------|--------|------|---|--------|--------|------|---|
| Return on equity       |   |   | 2.40 | % |   |   | 2.64 | % |   |   | 3.38 | % |
| Dividend payout ratio  |   |   | 0.00 | % |   |   | 0.00 | % |   |   | 0.00 | % |
| Equity to assets ratio |   |   | 8.87 | % |   |   | 8.68 | % |   |   | 9.12 | % |

----

----

|              |   | Actual                 |   |   | Minimum forCapital Adequacy |   |   | Minimum to beWell Capitalized |   |
|-------------------|--------|------------------------|--------|--------|-----------------------------|--------|--------|-------------------------------|--------|
|              |   | Amount                 |   |   | Ratio                       |   |   | Amount                        |   |   | Ratio |   |   | Amount |   |   | Ratio |   |
| December 31, 2010 |   | (Dollars in thousands) |   |
| The Company       |   |                   |   |   |                        |   |   |                          |   |   |   |   |   |   |   |   |   |   |

| Total Capital to risk weighted assets                         |   | $      | 48,603 |   |   |   | 15.7   | %      |   | $      | 24,753 |   |   |   | 8.0    | %      |   | NA     |   |   | NA     |   |
|---------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Tier 1 Capital to risk weighted assets                        |   | $      | 44,712 |   |   |   | 14.5   | %      |   | $      | 12,377 |   |   |   | 4.0    | %      |   | NA     |   |   | NA     |   |
| Tier 1 Capital to average assets    (leverage) |   | $      | 44,712 |   |   |   | 8.8    | %      |   | $      | 20,235 |   |   |   | 4.0    | %      |   | NA     |   |   | NA     |   |
| Community First Bank                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Capital to risk weighted assets                         |   | $      | 43,340 |   |   |   | 14.2   | %      |   | $      | 24,445 |   |   |   | 8.0    | %      |   | $      | 30,556 |   |   |   | 10.0 | % |
| Tier 1 Capital to risk weighted assets                        |   | $      | 39,497 |   |   |   | 12.9   | %      |   | $      | 12,222 |   |   |   | 4.0    | %      |   | $      | 18,334 |   |   |   | 6.0 | % |
| Tier 1 Capital to average assets    (leverage) |   | $      | 39,497 |   |   |   | 7.9    | %      |   | $      | 20,083 |   |   |   | 4.0    | %      |   | $      | 25,104 |   |   |   | 5.0 | % |
|                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31, 2009                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| The Company                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Capital to risk weighted assets                         |   | $      | 48,127 |   |   |   | 15.5   | %      |   | $      | 24,769 |   |   |   | 8.0    | %      |   | NA     |   |   | NA     |   |
| Tier 1 Capital to risk weighted assets                        |   | $      | 44,230 |   |   |   | 14.3   | %      |   | $      | 12,385 |   |   |   | 4.0    | %      |   | NA     |   |   | NA     |   |
| Tier 1 Capital to average assets    (leverage) |   | $      | 44,230 |   |   |   | 9.3    | %      |   | $      | 18,991 |   |   |   | 4.0    | %      |   | NA     |   |   | NA     |   |
| Community First Bank                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Capital to risk weighted assets                         |   | $      | 42,709 |   |   |   | 14.0   | %      |   | $      | 24,461 |   |   |   | 8.0    | %      |   | $      | 30,577 |   |   |   | 10.0 | % |
| Tier 1 Capital to risk weighted assets                        |   | $      | 38,859 |   |   |   | 12.7   | %      |   | $      | 12,231 |   |   |   | 4.0    | %      |   | $      | 18,346 |   |   |   | 6.0 | % |
| Tier 1 Capital to average assets    (leverage) |   | $      | 38,859 |   |   |   | 8.2    | %      |   | $      | 18,985 |   |   |   | 4.0    | %      |   | $      | 23,732 |   |   |   | 5.0 | % |

| ·   | any obligation under a direct or indirect guarantee or similar arrangement; |
|--------------------|-----------------------------------------------------------------------------|

| ·   | a retained or contingent interest in assets transferred to an unconsolidated entity or similar arrangement; |
|--------------------|-------------------------------------------------------------------------------------------------------------|

| ·   | derivatives, to the extent that the fair value thereof is not fully reflected as a liability or asset in the financial statements; or |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------|

| ·   | any obligation or liability, including a contingent obligation or liability, to the extent that it is not fully reflected in the financial statements (excluding the footnotes thereto). |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                      |   | December 31,           |   |
|---------------------------|--------|------------------------|--------|
|                      |   | 2010                   |   |   | 2009 |   |
|                      |   | (Dollars in thousands) |   |
|                      |   |                   |   |   |   |   |
| Loan commitments          |   | $                      | 26,834 |   |   | $ | 28,527 |   |
| Standby letters of credit |   |                   | 869    |   |   |   | 873 |   |

----

----

----

----

----

----

| Consolidated Balance Sheets                                              |   |         |        |   |   |   |
|--------------------------------------------------------------------------|--------|--------------|-------------|--------|--------|--------|
| Community First Bancorporation and Subsidiaries                          |   |         |        |   |   |   |
|                                                                     |   |         |        |   |   |   |
|                                                                     |   | December 31, |        |
|                                                                     |   | 2010         |        |   | 2009   |   |
| Assets                                                                   |   |         |        |   |   |   |
| Cash and due from banks (Note B)                                         |   | $            | 1,711,068   |   |   | $      | 1,462,535 |   |
| Interest bearing deposits due from banks                                 |   |         | 39,170,864  |   |   |   | 46,020,551 |   |
|     Cash and cash equivalents                        |   |         | 40,881,932  |   |   |   | 47,483,086 |   |
| Securities available-for-sale (Note C)                                   |   |         | 169,368,635 |   |   |   | 141,710,113 |   |
| Securities held-to-maturity (fair value of $6,816,698 for 2010 and       |   |         |        |   |   |   |   |   |
| $9,476,399 for 2009) (Note C)                                            |   |         | 6,388,693   |   |   |   | 9,023,999 |   |
| Federal Home Loan Bank stock, at cost                                    |   |         | 1,362,800   |   |   |   | 1,306,500 |   |
| Loans (Note D)                                                           |   |         | 256,834,367 |   |   |   | 267,248,148 |   |
|     Allowance for loan losses                        |   |         | (5,755,859  | )      |   |   | (6,051,851 | ) |
|     Loans - net                                      |   |         | 251,078,508 |   |   |   | 261,196,297 |   |
| Premises and equipment - net (Note E)                                    |   |         | 8,169,927   |   |   |   | 8,469,682 |   |
| Accrued interest receivable                                              |   |         | 2,491,378   |   |   |   | 2,424,113 |   |
| Bank-owned life insurance                                                |   |         | 9,666,366   |   |   |   | 9,289,415 |   |
| Foreclosed assets                                                        |   |         | 11,394,924  |   |   |   | 6,077,475 |   |
| Other assets                                                             |   |         | 4,955,953   |   |   |   | 5,916,849 |   |
|                                                                     |   |         |        |   |   |   |   |   |
|     Total assets                                     |   | $            | 505,759,116 |   |   | $      | 492,897,529 |   |
|                                                                     |   |         |        |   |   |   |   |   |
| Liabilities                                                              |   |         |        |   |   |   |   |   |
| Deposits (Note F)                                                        |   |         |        |   |   |   |   |   |
|     Noninterest bearing                              |   | $            | 46,844,126  |   |   | $      | 47,066,775 |   |
|     Interest bearing                                 |   |         | 398,465,882 |   |   |   | 389,580,956 |   |
|      Total deposits                             |   |         | 445,310,008 |   |   |   | 436,647,731 |   |
| Accrued interest payable                                                 |   |         | 1,698,204   |   |   |   | 2,043,563 |   |
| Short-term borrowings (Note G)                                           |   |         | 5,000,000   |   |   |   | - |   |
| Long-term debt (Note H)                                                  |   |         | 6,500,000   |   |   |   | 8,000,000 |   |
| Other liabilities                                                        |   |         | 1,939,475   |   |   |   | 1,387,924 |   |
|      Total liabilities                          |   |         | 460,447,687 |   |   |   | 448,079,218 |   |
|                                                                     |   |         |        |   |   |   |   |   |
| Commitments and contingent liabilities (Note M)                          |   |         |        |   |   |   |   |   |
|                                                                     |   |         |        |   |   |   |   |   |
| Shareholders' equity (Note I)                                            |   |         |        |   |   |   |   |   |
| Preferred Stock - Series A - non-voting 5% cumulative - $1,000 per share |   |         |        |   |   |   |   |   |
|     liquidation preference; 5,000 shares authorized; |   |         |        |   |   |   |   |   |
|     issued and outstanding - 3,150 shares            |   |         | 3,126,215   |   |   |   | 3,126,215 |   |
| Preferred Stock - no par value; 9,995,000 shares authorized;             |   |         |        |   |   |   |   |   |
|     None issued and outstanding                      |   |         | -           |   |   |   | - |   |
| Common stock - no par value; 10,000,000 shares authorized;               |   |         |        |   |   |   |   |   |
|     issued and outstanding - 3,972,976 for 2010 and  |   |         |        |   |   |   |   |   |
|     3,782,415 for 2009                               |   |         | 39,930,838  |   |   |   | 38,922,623 |   |
| Additional paid-in capital                                               |   |         | 747,621     |   |   |   | 747,621 |   |
| Retained earnings                                                        |   |         | 1,396,233   |   |   |   | 1,434,247 |   |
| Accumulated other comprehensive income                                   |   |         | 110,522     |   |   |   | 587,605 |   |
|     Total shareholders' equity                       |   |         | 45,311,429  |   |   |   | 44,818,311 |   |
|                                                                     |   |         |        |   |   |   |   |   |
|     Total liabilities and shareholders' equity       |   | $            | 505,759,116 |   |   | $      | 492,897,529 |   |
|                                                                     |   |         |        |   |   |   |   |   |
| See accompanying notes to consolidated financial statements.             |   |         |        |   |   |   |   |   |

----

| Consolidated Statements of Income                                                    |   |                     |       |   |   |   |       |   |   |
|--------------------------------------------------------------------------------------|--------|--------------------------|------------|--------|--------|--------|------------|--------|--------|
| Community First Bancorporation and Subsidiaries                                      |   |                     |       |   |   |   |       |   |   |
|                                                                                 |   |                     |       |   |   |   |       |   |   |
|                                                                                 |   | Years Ended December 31, |       |
|                                                                                 |   | 2010                     |       |   | 2009   |   |       | 2008   |   |
| Interest income                                                                      |   |                     |       |   |   |   |       |   |   |
| Loans, including fees                                                                |   | $                        | 15,939,090 |   |   | $      | 16,517,132 |   |   | $ | 18,212,174 |   |
| Securities                                                                           |   |                     |       |   |   |   |       |   |   |   |   |   |
| Taxable                                                                              |   |                     | 5,016,231  |   |   |   | 5,568,337  |   |   |   | 4,807,778 |   |
| Tax-exempt                                                                           |   |                     | 762,917    |   |   |   | 811,052    |   |   |   | 833,677 |   |
|        Federal funds sold                              |   |                     | -          |   |   |   | 2,649      |   |   |   | 632,265 |   |
|        Other                                           |   |                     | 4,383      |   |   |   | 4,088      |   |   |   | 47,714 |   |
|      Interest bearing deposits due from banks                    |   |                     | 117,736    |   |   |   | 47,314     |   |   |   | 17,787 |   |
| Total interest income                                                                |   |                     | 21,840,357 |   |   |   | 22,950,572 |   |   |   | 24,551,395 |   |
|                                                                                 |   |                     |       |   |   |   |       |   |   |   |   |   |
| Interest expense                                                                     |   |                     |       |   |   |   |       |   |   |   |   |   |
|      Time deposits $100,000 and over                             |   |                     | 3,026,908  |   |   |   | 3,751,612  |   |   |   | 4,325,891 |   |
| Other deposits                                                                       |   |                     | 5,241,714  |   |   |   | 6,718,320  |   |   |   | 8,228,274 |   |
| Short-term borrowings                                                                |   |                     | -          |   |   |   | 47,195     |   |   |   | 11,051 |   |
| Long-term debt                                                                       |   |                     | 284,651    |   |   |   | 365,850    |   |   |   | 269,208 |   |
| Total interest expense                                                               |   |                     | 8,553,273  |   |   |   | 10,882,977 |   |   |   | 12,834,424 |   |
|                                                                                 |   |                     |       |   |   |   |       |   |   |   |   |   |
| Net interest income                                                                  |   |                     | 13,287,084 |   |   |   | 12,067,595 |   |   |   | 11,716,971 |   |
| Provision for loan losses (Note D)                                                   |   |                     | 4,525,000  |   |   |   | 4,355,000  |   |   |   | 4,550,000 |   |
| Net interest income after provision                                                  |   |                     | 8,762,084  |   |   |   | 7,712,595  |   |   |   | 7,166,971 |   |
|                                                                                 |   |                     |       |   |   |   |       |   |   |   |   |   |
| Other income                                                                         |   |                     |       |   |   |   |       |   |   |   |   |   |
|     Service charges on deposit accounts                               |   |                     | 1,243,793  |   |   |   | 1,406,988  |   |   |   | 1,478,495 |   |
|     Credit life insurance commissions                                 |   |                     | 11,989     |   |   |   | 15,777     |   |   |   | 14,375 |   |
|      Mortgage brokerage income                                   |   |                     | 184,336    |   |   |   | 178,347    |   |   |   | 26,646 |   |
|       Gain (loss) on sales of securities available-for-sale |   |                     | -          |   |   |   | 90,076     |   |   |   | (3,396 | ) |
|      Debit card transaction fees                                 |   |                     | 632,466    |   |   |   | 542,282    |   |   |   | 473,265 |   |
|      Increase in value of life insurance contracts               |   |                     | 376,951    |   |   |   | 368,765    |   |   |   | 375,012 |   |
|      Other income                                                |   |                     | 113,420    |   |   |   | 115,780    |   |   |   | 130,885 |   |
| Total other income                                                                   |   |                     | 2,562,955  |   |   |   | 2,718,015  |   |   |   | 2,495,282 |   |
|                                                                                 |   |                     |       |   |   |   |       |   |   |   |   |   |
| Other expenses (Notes J and L)                                                       |   |                     |       |   |   |   |       |   |   |   |   |   |
|      Salaries and employee benefits                              |   |                     | 4,890,784  |   |   |   | 4,931,004  |   |   |   | 4,537,173 |   |
|      Net occupancy expense                                       |   |                     | 548,488    |   |   |   | 511,944    |   |   |   | 514,488 |   |
|      Furniture and equipment expense                             |   |                     | 368,599    |   |   |   | 392,392    |   |   |   | 429,850 |   |
|      FDIC insurance expense                                      |   |                     | 1,098,669  |   |   |   | 711,033    |   |   |   | 188,000 |   |
|      Debit card transaction expenses                             |   |                     | 460,057    |   |   |   | 409,740    |   |   |   | 373,382 |   |
|      Other expense                                               |   |                     | 2,743,710  |   |   |   | 2,292,564  |   |   |   | 2,024,477 |   |
| Total other expenses                                                                 |   |                     | 10,110,307 |   |   |   | 9,248,677  |   |   |   | 8,067,370 |   |
|                                                                                 |   |                     |       |   |   |   |       |   |   |   |   |   |
| Income before income taxes                                                           |   |                     | 1,214,732  |   |   |   | 1,181,933  |   |   |   | 1,594,883 |   |
| Income tax expense (Note K)                                                          |   |                     | 101,834    |   |   |   | 81,219     |   |   |   | 252,385 |   |
| Net income                                                                           |   |                     | 1,112,898  |   |   |   | 1,100,714  |   |   |   | 1,342,498 |   |
| Deductions for amounts not available to common shareholders:                         |   |                     |       |   |   |   |       |   |   |   |   |   |
|   Dividends declared or accumulated on preferred stock                          |   |                     | 177,188    |   |   |   | -          |   |   |   | - |   |
| Net income available to common shareholders                                          |   | $                        | 935,710    |   |   | $      | 1,100,714  |   |   | $ | 1,342,498 |   |
|                                                                                 |   |                     |       |   |   |   |       |   |   |   |   |   |
| Per common share (Note I)                                                            |   |                     |       |   |   |   |       |   |   |   |   |   |
| Net income                                                                           |   | $                        | 0.24       |   |   | $      | 0.28       |   |   | $ | 0.34 |   |
| Net income, assuming dilution                                                        |   |                     | 0.24       |   |   |   | 0.28       |   |   |   | 0.33 |   |
|                                                                                 |   |                     |       |   |   |   |       |   |   |   |   |   |
| See accompanying notes to consolidated financial statements.                         |   |                     |       |   |   |   |       |   |   |   |   |   |

----

|                                                                                                                                                                                                                                                                        |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------|-----------|--------|----------------|--------|-----------|-------------|--------|--------|--------------------------|--------|--------|------------------|---------|--------|---------------------------------------------|--------|------------|--------|--------|
|                                                                                                                                                                                                                                                                        |   | Shares ofCommonStock |      |   | PreferredStock |   |      | CommonStock |   |   | AdditionalPaid-inCapital |   |   | RetainedEarnings |    |   | AccumulatedOtherCompre-hensiveIncome (Loss) |   |       | Total  |   |
|                                                                                                                                                                                                                                                                        |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |
| Balance, January 1, 2008                                                                                                                                                                                                                                                    |   |                 | 3,324,105 |   |           | $      | -         |        |   | $      | 35,008,926               |   |   | $                | 681,498 |   |                                        | $      | 2,140,465  |   |   | $ | 80,099 |   |   | $ | 37,910,988 |   |
| Comprehensive income:                                                                                                                                                                                                                                                       |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|   Net income                                                                                                                                                                                                                                                           |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | 1,342,498  |   |   |   | - |   |   |   | 1,342,498 |   |
|    Unrealized net holding gains on                                                                                                                                                                                                                                |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|          available-for-sale securities              arising during the period,                                                                                          |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|          net of income tax effects          of $137,053                                                                                                                                     |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | 244,712 |   |   |   | 244,712 |   |
|   Reclassification adjustment,                                                                                                                                                                                                                                         |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|          net of income tax effects         of $1,219                                                                                                                                        |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | 2,177 |   |   |   | 2,177 |   |
|            Total other comprehensive               income                                                                                           |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | 246,889 |   |
|                Total comprehensive income                                                                                                                                                             |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | 1,589,387 |   |
| Excess income tax benefits     from exercises of                                                                                                                                                                                                        |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|     non-qualified stock options                                                                                                                                                                                                                              |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | 66,123  |   |                                        |   | -          |   |   |   | - |   |   |   | 66,123 |   |
| Declaration of 5% stock dividend                                                                                                                                                                                                                                            |   |                 | 169,406   |   |           |   | -         |        |   |   | 1,711,001                |   |   |             | -       |   |                                        |   | (1,714,411 | )      |   |   | - |   |   |   | (3,410 | ) |
| Exercise of employee stock options                                                                                                                                                                                                                                          |   |                 | 70,768    |   |           |   | -         |        |   |   | 364,535                  |   |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | 364,535 |   |
| Balance, December 31, 2008                                                                                                                                                                                                                                                  |   |                 | 3,564,279 |   |           |   | -         |        |   |   | 37,084,462               |   |   |             | 747,621 |   |                                        |   | 1,768,552  |   |   |   | 326,988 |   |   |   | 39,927,623 |   |
| Comprehensive income:                                                                                                                                                                                                                                                       |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|      Net income                                                                                                                                                                                                                                         |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | 1,100,714  |   |   |   | - |   |   |   | 1,100,714 |   |
|       Unrealized net holding gains on                                                                                                                                                                                                              |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|           available-for-sale securities          arising  during the period, net                                                                                   |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|           of  income tax effects of          $178,299                                                                                                                        |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | 318,356 |   |   |   | 318,356 |   |
| Reclassification adjustment,                                                                                                                                                                                                                                                |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|           net of income tax effects          of $32,336                                                                                                                           |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | (57,739 | ) |   |   | (57,739 | ) |
|            Total other comprehensive              income                                                                                                 |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | 260,617 |   |
|                Total comprehensive income                                                                                                                                                             |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | 1,361,331 |   |
| Declaration of 5% stock dividend                                                                                                                                                                                                                                            |   |                 | 180,094   |   |           |   | -         |        |   |   | 1,431,914                |   |   |             | -       |   |                                        |   | (1,435,019 | )      |   |   | - |   |   |   | (3,105 | ) |
| Net proceeds from issuing 3,150                                                                                                                                                                                                                                             |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|     shares of preferred stock (issuance     costs of $23,785)                                                                                                                                                                            |   |                 | -         |   |           |   | 3,126,215 |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | 3,126,215 |   |
| Exercise of employee stock options                                                                                                                                                                                                                                          |   |                 | 45,532    |   |           |   | -         |        |   |   | 486,232                  |   |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | 486,232 |   |
| Common stock repurchased   and cancelled                                                                                                                                                                                                                          |   |                 | (7,490    | )      |           |   | -         |        |   |   | (79,985                  | )      |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | (79,985 | ) |
| Balance, December 31, 2009                                                                                                                                                                                                                                                  |   |                 | 3,782,415 |   |           |   | 3,126,215 |        |   |   | 38,922,623               |   |   |             | 747,621 |   |                                        |   | 1,434,247  |   |   |   | 587,605 |   |   |   | 44,818,311 |   |
| Comprehensive income:                                                                                                                                                                                                                                                       |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|     Net income                                                                                                                                                                                                                                               |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | 1,112,898  |   |   |   | - |   |   |   | 1,112,898 |   |
|      Unrealized net holding gains on                                                                                                                                                                                                                    |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|           available-for-sale securities          arising during the period, net                                                                                         |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|           of income tax effects of $267,196                                                                                                                                                                                    |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | (477,083 | ) |   |   | (477,083 | ) |
|                 Total other comprehensive                       income (loss) |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | (477,083 | ) |
|                   Total comprehensive       income                                                                                                  |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | 635,815 |   |
| Payment of divdends on     preferred stock                                                                                                                                                                                                              |   |                 | -         |   |           |   | -         |        |   |   | -                        |   |   |             | -       |   |                                        |   | (157,500   | )      |   |   | - |   |   |   | (157,500 | ) |
| Declaration of 5% stock dividend                                                                                                                                                                                                                                            |   |                 | 188,817   |   |           |   | -         |        |   |   | 991,342                  |   |   |             | -       |   |                                        |   | (993,412   | )      |   |   | - |   |   |   | (2,070 | ) |
| Exercise of employee stock options                                                                                                                                                                                                                                          |   |                 | 1,744     |   |           |   | -         |        |   |   | 16,873                   |   |   |             | -       |   |                                        |   | -          |   |   |   | - |   |   |   | 16,873 |   |
| Balance, December 31, 2010                                                                                                                                                                                                                                                  |   |                 | 3,972,976 |   |           | $      | 3,126,215 |        |   | $      | 39,930,838               |   |   | $                | 747,621 |   |                                        | $      | 1,396,233  |   |   | $ | 110,522 |   |   | $ | 45,311,429 |   |
|                                                                                                                                                                                                                                                                        |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                        |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                        |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                        |   |                 |      |   |           |   |      |        |   |   |                     |   |   |             |    |   |                                        |   |       |   |   |   |   |   |   |   |   |   |

----

| Consolidated Statements of Cash Flows                           |                     |   |         |   |   |   |         |   |   |
|-----------------------------------------------------------------|--------------------------|--------|--------------|--------|--------|--------|--------------|--------|--------|
| Community First Bancorporation and Subsidiaries                 |                     |   |         |   |   |   |         |   |   |
|                                                            | Years Ended December 31, |   |
|                                                            |                     | 2010   |         |   | 2009   |   |         | 2008   |   |
| Operating activities                                            |                     |   |         |   |   |   |         |   |   |
|  Net income                                                |                     | $      | 1,112,898    |   |   | $      | 1,100,714    |   |   | $ | 1,342,498 |   |
| Adjustments to reconcile net income to net                      |                     |   |         |   |   |   |         |   |   |   |   |   |
| cash provided by operating activities                           |                     |   |         |   |   |   |         |   |   |   |   |   |
| Provision for loan losses                                       |                     |   | 4,525,000    |   |   |   | 4,355,000    |   |   |   | 4,550,000 |   |
| Depreciation                                                    |                     |   | 381,494      |   |   |   | 391,764      |   |   |   | 416,971 |   |
| Deferred income taxes                                           |                     |   | (274,286     | )      |   |   | (206,887     | )      |   |   | (956,973 | ) |
| Amortization of net loan fees and costs                         |                     |   | (81,891      | )      |   |   | (138,490     | )      |   |   | (179,539 | ) |
| Securities accretion and premium amortization                   |                     |   | 1,433,684    |   |   |   | 845,582      |   |   |   | 75,087 |   |
| Deferred compensation expense                                   |                     |   | 543,050      |   |   |   | 486,197      |   |   |   | 434,116 |   |
| (Gains) losses realized on sales of                             |                     |   |         |   |   |   |         |   |   |   |   |   |
| available-for-sale securities                                   |                     |   | -            |   |   |   | (90,076      | )      |   |   | 3,396 |   |
| Accretion of cash surrender value of life insurance             |                     |   | (376,951     | )      |   |   | (368,765     | )      |   |   | (375,012 | ) |
| Loss on sale of foreclosed assets                               |                     |   | 20,086       |   |   |   | 290          |   |   |   | 6,000 |   |
| (Increase) decrease in interest receivable                      |                     |   | (67,265      | )      |   |   | 351,675      |   |   |   | (246,633 | ) |
| Decrease in interest payable                                    |                     |   | (345,359     | )      |   |   | (1,001,418   | )      |   |   | (434,588 | ) |
| Decrease (increase) in prepaid expenses and other assets        |                     |   | 1,502,378    |   |   |   | (2,673,045   | )      |   |   | (273,766 | ) |
| Increase in other accrued expenses                              |                     |   | 8,501        |   |   |   | 20,277       |   |   |   | 56,209 |   |
| Net cash provided by operating activities                       |                     |   | 8,381,339    |   |   |   | 3,072,818    |   |   |   | 4,417,766 |   |
|                                                            |                     |   |         |   |   |   |         |   |   |   |   |   |
| Investing activities                                            |                     |   |         |   |   |   |         |   |   |   |   |   |
| Purchases of available-for-sale securities                      |                     |   | (168,055,438 | )      |   |   | (133,699,046 | )      |   |   | (84,156,840 | ) |
| Maturities, calls and paydowns of available-for-sale securities |                     |   | 138,219,666  |   |   |   | 112,429,490  |   |   |   | 47,120,613 |   |
| Proceeds of sales of available-for-sale securities              |                     |   | -            |   |   |   | 5,851,147    |   |   |   | 9,732,462 |   |
| Purchases of securities held-to-maturity                        |                     |   | -            |   |   |   | -            |   |   |   | (7,490,035 | ) |
| Maturities, calls and paydowns of held-to-maturity securities   |                     |   | 2,634,593    |   |   |   | 2,881,173    |   |   |   | 1,243,838 |   |
| Purchases of Federal Home Loan Bank stock                       |                     |   | (195,700     | )      |   |   | (126,000     | )      |   |   | (379,700 | ) |
| Proceeds of redemptions of Federal Home Loan Bank stock         |                     |   | 139,400      |   |   |   | 39,100       |   |   |   | - |   |
| Net increase in loans made to customers                         |                     |   | (536,137     | )      |   |   | (6,856,415   | )      |   |   | (28,457,229 | ) |
| Purchases of premises and equipment                             |                     |   | (81,739      | )      |   |   | (206,193     | )      |   |   | (450,699 | ) |
| Proceeds from sale of foreclosed assets                         |                     |   | 901,913      |   |   |   | 1,276,094    |   |   |   | 34,000 |   |
| Capitalized additions to other real estate owned                |                     |   | (28,631      | )      |   |   | (266,228     | )      |   |   | - |   |
| Proceeds from redemptions of bank-owned life insurance          |                     |   | -            |   |   |   | 1,062,152    |   |   |   | - |   |
| Purchases of bank-owned life insurance                          |                     |   | -            |   |   |   | (1,500,000   | )      |   |   | (1,000,006 | ) |
| Net cash used by investing activities                           |                     |   | (27,002,073  | )      |   |   | (19,114,726  | )      |   |   | (63,803,596 | ) |
|                                                            |                     |   |         |   |   |   |         |   |   |   |   |   |
| Financing activities                                            |                     |   |         |   |   |   |         |   |   |   |   |   |
| Net increase in demand deposits, interest                       |                     |   |         |   |   |   |         |   |   |   |   |   |
| bearing transaction accounts and savings accounts               |                     |   | 15,940,120   |   |   |   | 3,581,980    |   |   |   | 2,485,387 |   |
| Net (decrease) increase in certificates of deposit and other    |                     |   |         |   |   |   |         |   |   |   |   |   |
| time deposits                                                   |                     |   | (7,277,843   | )      |   |   | 16,950,568   |   |   |   | 57,763,243 |   |
| Net increase in short-term borrowings                           |                     |   | 5,000,000    |   |   |   | -            |   |   |   | - |   |
| Proceeds of issuances of long-term debt                         |                     |   | -            |   |   |   | -            |   |   |   | 6,000,000 |   |
| Repayment of long-term debt                                     |                     |   | (1,500,000   | )      |   |   | (1,500,000   | )      |   |   | (1,000,000 | ) |
| Net proceeds from issuing preferred stock                       |                     |   |         |   |   |   |         |   |   |   |   |   |
| (issuance costs of $23,785)                                     |                     |   | -            |   |   |   | 3,126,215    |   |   |   | - |   |
| Payment of cash in lieu of fractional shares                    |                     |   |         |   |   |   |         |   |   |   |   |   |
| for common stock dividend                                       |                     |   | (2,070       | )      |   |   | (6,515       | )      |   |   | - |   |
| Payment of divdends on preferred stock                          |                     |   | (157,500     | )      |   |   | -            |   |   |   | - |   |
| Exercise of employee stock options                              |                     |   | 16,873       |   |   |   | 486,232      |   |   |   | 364,535 |   |
| Common stock repurchased and cancelled                          |                     |   | -            |   |   |   | (79,985      | )      |   |   | - |   |
| Excess tax benefits of exercises of stock options               |                     |   | -            |   |   |   | -            |   |   |   | 66,123 |   |
| Net cash provided by financing activities                       |                     |   | 12,019,580   |   |   |   | 22,558,495   |   |   |   | 65,679,288 |   |
| (Decrease) increase in cash and cash equivalents                |                     |   | (6,601,154   | )      |   |   | 6,516,587    |   |   |   | 6,293,458 |   |
| Cash and cash equivalents, beginning                            |                     |   | 47,483,086   |   |   |   | 40,966,499   |   |   |   | 34,673,041 |   |
| Cash and cash equivalents, ending                               |                     | $      | 40,881,932   |   |   | $      | 47,483,086   |   |   | $ | 40,966,499 |   |
|                                                            |                     |   |         |   |   |   |         |   |   |   |   |   |
|                                                            |                     |   |         |   |   |   |         |   |   |   |   |   |
| See accompanying notes to consolidated financial statements.    |                     |   |         |   |   |   |         |   |   |   |   |   |

----

| Consolidated Statements of Cash Flows - continued            |   |                     |      |   |   |   |       |   |   |
|--------------------------------------------------------------|--------|--------------------------|-----------|--------|--------|--------|------------|--------|--------|
| Community First Bancorporation and Subsidiaries              |   |                     |      |   |   |   |       |   |   |
|                                                         |   | Years Ended December 31, |      |
|                                                         |   | 2010                     |      |   | 2009   |   |       | 2008   |   |
| Supplemental Disclosure of Cash Flow Information             |   |                     |      |   |   |   |       |   |   |
| Cash paid during the period for                              |   |                     |      |   |   |   |       |   |   |
|     Interest                             |   | $                        | 8,898,632 |   |   | $      | 11,884,395 |   |   | $ | 13,269,012 |   |
| Income taxes                                                 |   |                     | 102,500   |   |   |   | 49,015     |   |   |   | 1,644,000 |   |
| Noncash investing and financing activities                   |   |                     |      |   |   |   |       |   |   |   |   |   |
| Transfer of loans to foreclosed assets                       |   |                     | 6,210,817 |   |   |   | 6,381,631  |   |   |   | 706,000 |   |
| Transfers from retained earnings to common stock             |   |                     |      |   |   |   |       |   |   |   |   |   |
| in connection with stock dividends                           |   |                     | 991,342   |   |   |   | 1,431,914  |   |   |   | 1,711,001 |   |
| Other comprehensive (loss) income                            |   |                     | (477,083  | )      |   |   | 260,617    |   |   |   | 246,889 |   |
| Cash payable in lieu of issuing fractional shares            |   |                     | -         |   |   |   | -          |   |   |   | 3,410 |   |
|                                                         |   |                     |      |   |   |   |       |   |   |   |   |   |
| See accompanying notes to consolidated financial statements. |   |                     |      |   |   |   |       |   |   |   |   |   |

----

----

----

----

|                                         |   |  December 31, |        |
|----------------------------------------------|--------|--------------------|-------------|
|                                         |   | 2010               |        |   | 2009 |   |
|                                         |   |               |        |   | Gross |   |   | Gross |   |   |   |   |   |   |   |   | Gross |   |   | Gross |   |   |   |   |
|                                         |   |               |        |   | Unrealized |   |   | Unrealized |   |   | Estimated |   |   |   |   |   | Unrealized |   |   | Unrealized |   |   | Estimated |   |
|                                         |   | Amortized          |        |   | Holding |   |   | Holding |   |   | Fair |   |   | Amortized |   |   | Holding |   |   | Holding |   |   | Fair |   |
|                                         |   | Cost               |        |   | Gains |   |   | Losses |   |   | Value |   |   | Cost |   |   | Gains |   |   | Losses |   |   | Value |   |
| Available-for-sale                           |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Mortgage-backed   securities       |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  issued by US Government                |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| agencies                                     |   | $                  | 1,127,558   |   |   | $ | 52,217 |   |   | $ | - |   |   | $ | 1,179,775 |   |   | $ | 1,426,107 |   |   | $ | 48,557 |   |   | $ | - |   |   | $ | 1,474,664 |   |
| Government sponsored                         |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| enterprises (GSEs)                           |   |               | 130,491,949 |   |   |   | 863,441 |   |   |   | 1,495,241 |   |   | $ | 129,860,149 |   |   |   | 87,142,606 |   |   |   | 643,235 |   |   |   | 822,912 |   |   |   | 86,962,929 |   |
| Mortgage-backed    securities |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     issued by GSEs            |   |               | 20,145,190  |   |   |   | 982,743 |   |   |   | - |   |   |   | 21,127,933 |   |   |   | 32,707,183 |   |   |   | 1,005,630 |   |   |   | 10,376 |   |   |   | 33,702,437 |   |
| State, county and                            |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| municipal                                    |   |               | 17,431,516  |   |   |   | 129,875 |   |   |   | 360,613 |   |   |   | 17,200,778 |   |   |   | 19,517,517 |   |   |   | 240,544 |   |   |   | 187,978 |   |   |   | 19,570,083 |   |
| Total                                        |   | $                  | 169,196,213 |   |   | $ | 2,028,276 |   |   | $ | 1,855,854 |   |   | $ | 169,368,635 |   |   | $ | 140,793,413 |   |   | $ | 1,937,966 |   |   | $ | 1,021,266 |   |   | $ | 141,710,113 |   |
|                                         |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Held-to-maturity                             |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Mortgage-backed   securities       |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  issued by US Government                |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| agencies                                     |   | $                  | -           |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
| Government sponsored                         |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| enterprises                                  |   |               | -           |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Mortgage-backed   securities       |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     issued by GSEs            |   |               | 6,388,693   |   |   |   | 428,005 |   |   |   | - |   |   |   | 6,816,698 |   |   |   | 9,023,999 |   |   |   | 452,400 |   |   |   | - |   |   |   | 9,476,399 |   |
| State, county and                            |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| municipal                                    |   |               | -           |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Total                                        |   | $                  | 6,388,693   |   |   | $ | 428,005 |   |   | $ | - |   |   | $ | 6,816,698 |   |   | $ | 9,023,999 |   |   | $ | 452,400 |   |   | $ | - |   |   | $ | 9,476,399 |   |

----

|                                                           |   |  December 31, 2010 |        |
|----------------------------------------------------------------|--------|-------------------------|-------------|
|                                                           |   | Available-for-sale      |        |   | Held-to-maturity |   |
|                                                           |   | Amortized               |        |   | Estimated |   |   | Amortized |   |   | Estimated |   |
| Non-mortgage backed securities issued by GSEs and              |   | Cost                    |        |   | Fair Value |   |   | Cost |   |   | Fair Value |   |
| by state, county and municipal issuers                         |   |                    |        |   |   |   |   |   |   |   |   |   |
| Due within one year                                            |   | $                       | -           |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
|      Due after one through five years |   |                    | 35,564,864  |   |   |   | 35,524,232 |   |   |   | - |   |   |   | - |   |
| Due after five through ten years                               |   |                    | 54,327,138  |   |   |   | 53,761,699 |   |   |   | - |   |   |   | - |   |
| Due after ten years                                            |   |                    | 58,031,463  |   |   |   | 57,774,996 |   |   |   | - |   |   |   | - |   |
|                                                           |   |                    | 147,923,465 |   |   |   | 147,060,927 |   |   |   | - |   |   |   | - |   |
| Mortgage-backed securities issued by:                          |   |                    |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      US Government agencies                |   |                    | 1,127,558   |   |   |   | 1,179,775 |   |   |   | - |   |   |   | - |   |
|   GSEs                                                    |   |                    | 20,145,190  |   |   |   | 21,127,933 |   |   |   | 6,388,693 |   |   |   | 6,816,698 |   |
| Total                                                          |   | $                       | 169,196,213 |   |   | $ | 169,368,635 |   |   | $ | 6,388,693 |   |   | $ | 6,816,698 |   |

----

|                                                  |   |   | December 31, 2010                                              |       |
|-------------------------------------------------------|--------|--------|----------------------------------------------------------------|------------|
|                                                  |   |   |  Continuously in Unrealized Loss Position for a Period of |       |
|                                                  |   |   | Less than 12 Months                                            |       |   | 12 Months or more |   |   | Total |   |
| Available-for-sale                                    |   |   | EstimatedFair Value                                            |       |   | Unrealized Loss |   |   | EstimatedFair Value |   |   | Unrealized Loss |   |   | EstimatedFair Value |   |   | Unrealized Loss |   |
|   US Government agencies                         |   | $      | -                                                              |       |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
|   Government- sponsored                          |   |   |                                                           |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       enterprises (GSEs)     |   |   |                                                           | 60,543,340 |   |   |   | 1,495,241 |   |   |   | - |   |   |   | - |   |   |   | 60,543,340 |   |   |   | 1,495,241 |   |
|   Mortgage-backed securities                     |   |   |                                                           |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       issued by GSEs         |   |   |                                                           | -          |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
|   State, county and                              |   |   |                                                           |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       municipal securities   |   |   |                                                           | 9,648,116  |   |   |   | 305,788 |   |   |   | 455,175 |   |   |   | 54,825 |   |   |   | 10,103,291 |   |   |   | 360,613 |   |
|         Total |   |   | $                                                              | 70,191,456 |   |   | $ | 1,801,029 |   |   | $ | 455,175 |   |   | $ | 54,825 |   |   | $ | 70,646,631 |   |   | $ | 1,855,854 |   |
|                                                  |   |   |                                                           |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Held-to-maturity                                      |   |   |                                                           |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     GSEs                               |   |   | $                                                              | -          |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
|        Total       |   |   | $                                                              | -          |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
|                                                  |   |   |                                                           |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                  |   |   |                                                           |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

|                          |   |   | December 31, 2009                                              |   |
|-------------------------------|--------|--------|----------------------------------------------------------------|--------|
|                          |   |   |  Continuously in Unrealized Loss Position for a Period of |   |
|                          |   |   | Less than 12 Months                                            |   |   | 12 Months or more |   |   | Total |   |
| Available-for-sale            |   |   | EstimatedFair Value                                            |   |   | Unrealized Loss |   |   | EstimatedFair Value |   |   | Unrealized Loss |   |   | EstimatedFair Value |   |   | Unrealized Loss |   |
|   US Government agencies |   | $      | -                                                              |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |

|   Government-sponsored                           |   |   |   |       |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |       |   |   |   |      |   |
|-------------------------------------------------------|--------|--------|--------|------------|--------|--------|--------|-----------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|------------|--------|--------|--------|-----------|--------|
|       enterprises (GSEs)     |   |   |   | 40,430,025 |   |   |   | 822,912   |   |   |   | -      |   |   |   | -      |   |   |   | 40,430,025 |   |   |   | 822,912   |   |
|    Mortgage-backed securities               |   |   |   |       |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |       |   |   |   |      |
|       issued by GSEs         |   |   |   | 2,811,173  |   |   |   | 10,376    |   |   |   | -      |   |   |   | -      |   |   |   | 2,811,173  |   |   |   | 10,376    |   |
|    State, county and                        |   |   |   |       |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |       |   |   |   |      |   |
|      municipal securities         |   |   |   | 6,220,000  |   |   |   | 187,978   |   |   |   | -      |   |   |   | -      |   |   |   | 6,220,000  |   |   |   | 187,978   |   |
|         Total |   |   | $      | 49,461,198 |   |   | $      | 1,021,266 |   |   | $      | -      |   |   | $      | -      |   |   | $      | 49,461,198 |   |   | $      | 1,021,266 |   |
|                                                  |   |   |   |       |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |       |   |   |   |      |   |
| Held-to-maturity                                      |   |   |   |       |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |       |   |   |   |      |   |
|   GSEs                                           |   |   | $      | -          |   |   | $      | -         |   |   | $      | -      |   |   | $      | -      |   |   | $      | -          |   |   | $      | -         |   |
|        Total       |   |   | $      | -          |   |   | $      | -         |   |   | $      | -      |   |   | $      | -      |   |   | $      | -          |   |   | $      | -         |   |

----

|                                                                                                                                          |   | December 31, |        |
|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------|-------------|
|                                                                                                                                          |   | 2010         |        |   | 2009 |   |
| Commercial, financial and industrial                                                                                                          |   | $            | 20,473,914  |   |   | $ | 23,108,861 |   |
| Real estate- construction                                                                                                                     |   |         | 23,729,929  |   |   |   | 29,438,596 |   |
| Real estate - mortgage                                                                                                                        |   |         | 187,940,359 |   |   |   | 184,474,249 |   |
| Consumer installment                                                                                                                          |   |         | 24,690,165  |   |   |   | 30,226,442 |   |
| Total                                                                                                                                         |   |         | 256,834,367 |   |   |   | 267,248,148 |   |
| Allowance for loan losses                                                                                                                     |   |         | (5,755,859  | ) |   |   | (6,051,851 | ) |
| Loans - net                                                                                                                                   |   | $            | 251,078,508 |   |   | $ | 261,196,297 |   |
| ___________________________                                                                                                                   |   |         |        |   |   |   |   |   |
| Net deferred loan fees of $254,718 and $290,444 were allocated to the various loan categories as of December 31, 2010 and 2009, respectively. |   |
|                                                                                                                                          |   |         |        |   |   |   |   |   |

|                         |   | Years Ended December 31, |       |
|------------------------------|--------|--------------------------|------------|
|                         |   | 2010                     |       |   | 2009 |   |   | 2008 |   |
|                         |   |                     |       |   |   |   |   |   |   |
| Balance at January 1         |   | $                        | 6,051,851  |   |   | $ | 5,475,294 |   |   | $ | 2,573,758 |   |
| Provision charged to expense |   |                     | 4,525,000  |   |   |   | 4,355,000 |   |   |   | 4,550,000 |   |
| Recoveries                   |   |                     | 140,246    |   |   |   | 107,568 |   |   |   | 18,062 |   |
| Charge-offs                  |   |                     | (4,961,238 | ) |   |   | (3,886,011 | ) |   |   | (1,666,526 | ) |
| Balance at December 31       |   | $                        | 5,755,859  |   |   | $ | 6,051,851 |   |   | $ | 5,475,294 |   |

----

|                      |   | 30-59 Days Past Due |      |   | 60-89 Days Past Due |   |      | 90 Days or More Past Due |   |   | Total Past Due |   |   | Current |       |   | Total Loans |   |
|---------------------------|--------|---------------------|-----------|--------|---------------------|--------|-----------|--------------------------|--------|--------|----------------|--------|--------|---------|------------|--------|-------------|--------|
| As of December 31, 2010   |   |                |      |   |                |   |      |                     |   |   |           |   |   |    |       |   |        |   |
| Commercial, financial and |   |                |      |   |                |   |      |                     |   |   |           |   |   |    |       |   |        |   |
| industrial                |   | $                   | 254,354   |   |                | $      | 213,290   |                     |   | $      | 854,963        |   |   | $       | 1,322,607  |   |        | $      | 19,151,307 |   |   | $ | 20,473,914 |   |
| Real estate- construction |   |                | 484,529   |   |                |   | 662,304   |                     |   |   | 6,082,144      |   |   |    | 7,228,977  |   |        |   | 16,500,952 |   |   |   | 23,729,929 |   |
| Real estate - mortgage    |   |                | 1,834,102 |   |                |   | 2,093,424 |                     |   |   | 8,973,637      |   |   |    | 12,901,163 |   |        |   | 175,039,196 |   |   |   | 187,940,359 |   |
| Consumer installment      |   |                | 294,049   |   |                |   | 255,786   |                     |   |   | 433,022        |   |   |    | 982,857    |   |        |   | 23,707,308 |   |   |   | 24,690,165 |   |
| Total                     |   | $                   | 2,867,034 |   |                | $      | 3,224,804 |                     |   | $      | 16,343,766     |   |   | $       | 22,435,604 |   |        | $      | 234,398,763 |   |   | $ | 256,834,367 |   |

|                                |                                    |   | Recorded Investment |       |   | Unpaid Principal Balance |   |       | Related Allowance |   |   | Average Recorded Investment |   |   | Interest Income Recognized |       |
|-------------------------------------|-----------------------------------------|--------|---------------------|------------|--------|--------------------------|--------|------------|-------------------|--------|--------|-----------------------------|--------|--------|----------------------------|------------|
| As of December 31, 2010             |                                    |   |                |       |   |                     |   |       |              |   |   |                        |   |   |                       |
| With no related allowance recorded: |                                    |   |                |       |   |                     |   |       |              |   |   |                        |   |   |                       |
|                                | Commercial, financial and industrial    |   | $                   | 166,905    |   |                     | $      | 166,905    |              |   | $      | -                           |   |   | $                          | 73,493     |   |   | $ | - |   |
|                                | Real estate- construction               |   |                | 2,889,762  |   |                     |   | 3,462,202  |              |   |   | -                           |   |   |                       | 2,568,761  |   |   |   | 13,280 |   |
|                                | Real estate - mortgage                  |   |                | 9,988,679  |   |                     |   | 10,637,708 |              |   |   | -                           |   |   |                       | 7,761,403  |   |   |   | 117,990 |   |
|                                | Consumer installment                    |   |                | 333,760    |   |                     |   | 333,760    |              |   |   | -                           |   |   |                       | 261,808    |   |   |   | - |   |
|                                |                                    |   |                |       |   |                     |   |       |              |   |   |                        |   |   |                       |       |   |   |   |   |   |
| With an allowance recorded:         |                                    |   |                |       |   |                     |   |       |              |   |   |                        |   |   |                       |       |   |   |   |   |
|                                | Commercial, financial and industrial    |   | $                   | 767,461    |   |                     | $      | 767,461    |              |   | $      | 515,328                     |   |   | $                          | 454,736    |   |   | $ | - |   |
|                                | Real estate- construction               |   |                | 845,998    |   |                     |   | 874,131    |              |   |   | 45,000                      |   |   |                       | 1,523,172  |   |   |   | 41,248 |   |
|                                | Real estate - mortgage                  |   |                | 5,359,691  |   |                     |   | 5,529,304  |              |   |   | 1,632,044                   |   |   |                       | 6,464,601  |   |   |   | - |   |
|                                | Consumer installment                    |   |                | 166,470    |   |                     |   | 166,470    |              |   |   | 65,406                      |   |   |                       | 272,799    |   |   |   | - |   |
|                                |                                    |   |                |       |   |                     |   |       |              |   |   |                        |   |   |                       |       |   |   |   |   |   |
| Total:                              |                                    |   |                |       |   |                     |   |       |              |   |   |                        |   |   |                       |       |   |   |   |   |   |
|                                | Commercial, financial and industrial    |   | $                   | 934,366    |   |                     | $      | 934,366    |              |   | $      | 515,328                     |   |   | $                          | 528,229    |   |   | $ | - |   |
|                                | Real estate - construction and mortgage |   |                | 19,084,130 |   |                     |   | 20,503,345 |              |   |   | 1,677,044                   |   |   |                       | 18,317,937 |   |   |   | 172,518 |   |
|                                | Consumer installment                    |   |                | 500,230    |   |                     |   | 500,230    |              |   |   | 65,406                      |   |   |                       | 534,607    |   |   |   | - |   |
|                                | Total                                   |   | $                   | 20,518,726 |   |                     | $      | 21,937,941 |              |   | $      | 2,257,778                   |   |   | $                          | 19,380,773 |   |   | $ | 172,518 |   |

----

| As of and for the year ended December 31, 2009                                 |   |   |       |
|--------------------------------------------------------------------------------|--------|--------|------------|
| Investment in impaired loans                                                   |   |   |       |
| Nonaccrual                                                                     |   | $      | 13,869,437 |   |
|      Accruing 90 days and over past due               |   |   | -          |   |
| Other                                                                          |   |   | 3,478,239  |   |
| Total                                                                          |   | $      | 17,347,676 |   |
|                                                                           |   |   |       |   |
| Average total investment in impaired loans during the year                     |   | $      | 15,149,000 |   |
| Amount of impaired loans for which an allowance for loan losses is established |   |   | 8,660,112  |   |
| Amount of impaired loans for which no allowance for loan losses is established |   |   | 8,687,564  |   |
| Amount of allowance for loan losses related to impaired loans                  |   |   | 2,844,014  |   |

|                          |   | Secured by  |        |   |   |   |       |   |   |
|-------------------------------|--------|-------------|-------------|--------|--------|--------|------------|--------|--------|
|                          |   | Real Estate |        |   | Other  |   |       | Total  |   |
| As of December 31, 2010       |   |        |        |   |   |   |       |   |   |
| Allowance for credit losses   |   |        |        |   |   |   |       |   |   |
| Ending balance                |   | $           | 3,752,570   |   |   | $      | 2,003,289  |   |   | $ | 5,755,859 |   |
| Ending balance - individually |   |        |        |   |   |   |       |   |   |   |   |   |
| evaluated for impairment      |   | $           | 1,504,045   |   |   | $      | 753,733    |   |   | $ | 2,257,778 |   |
| Ending balance - collectively |   |        |        |   |   |   |       |   |   |   |   |   |
| evaluated for impairment      |   | $           | 2,248,525   |   |   | $      | 1,249,556  |   |   | $ | 3,498,081 |   |
|                          |   |        |        |   |   |   |       |   |   |   |   |   |
| Loans                         |   |        |        |   |   |   |       |   |   |   |   |   |
| Ending balance                |   | $           | 211,520,138 |   |   | $      | 45,314,229 |   |   | $ | 256,834,367 |   |
| Ending balance - individually |   |        |        |   |   |   |       |   |   |   |   |   |
| evaluated for impairment      |   | $           | 18,424,519  |   |   | $      | 2,094,207  |   |   | $ | 20,518,726 |   |
| Ending balance - collectively |   |        |        |   |   |   |       |   |   |   |   |   |
| evaluated for impairment      |   | $           | 193,095,619 |   |   | $      | 43,220,022 |   |   | $ | 236,315,641 |   |

----

|                                                              |   | Internally Assigned Risk Grade |       |   |            |   |
|-------------------------------------------------------------------|--------|--------------------------------|------------|--------|-----------------|--------|
| As of December 31, 2010                                           |   | Management Attention           |       |   | Special Mention |   |   | Substandard |   |   | Doubtful |   |   | Total |   |
|  Commercial, financial and    industrial |   | $                              | 523,887    |   |            | $      | 577,219 |   |   | $ | 1,385,355 |   |   | $ | - |   |   | $ | 2,486,461 |   |
|  Real estate- construction                                   |   |                           | 1,953,034  |   |            |   | 2,979,539 |   |   |   | 7,953,507 |   |   |   | - |   |   |   | 12,886,080 |   |
|  Real estate - mortgage                                      |   |                           | 12,627,621 |   |            |   | 8,325,770 |   |   |   | 12,794,722 |   |   |   | 237,428 |   |   |   | 33,985,541 |   |
|  Consumer installment                                        |   |                           | 1,177,199  |   |            |   | 684,234 |   |   |   | 805,765 |   |   |   | - |   |   |   | 2,667,198 |   |
|                                                              |   | $                              | 16,281,741 |   |            | $      | 12,566,762 |   |   | $ | 22,939,349 |   |   | $ | 237,428 |   |   | $ | 52,025,280 |   |

|                            |   | December 31, |       |
|---------------------------------|--------|--------------|------------|
|                            |   | 2010         |       |   | 2009 |   |
|                            |   |         |       |   |   |   |
| Land                            |   | $            | 2,916,997  |   |   | $ | 2,916,997 |   |
| Buildings and land improvements |   |         | 5,702,858  |   |   |   | 5,702,858 |   |
| Furniture and equipment         |   |         | 3,471,132  |   |   |   | 3,389,393 |   |
|    Total              |   |         | 12,090,987 |   |   |   | 12,009,248 |   |
| Accumulated depreciation        |   |         | 3,921,060  |   |   |   | 3,539,566 |   |
| Premises and equipment - net    |   | $            | 8,169,927  |   |   | $ | 8,469,682 |   |

|                                  |   | December 31, |        |
|---------------------------------------|--------|--------------|-------------|
|                                  |   | 2010         |        |   | 2009 |   |
|                                  |   |         |        |   |   |   |
| Noninterest bearing demand            |   | $            | 46,844,126  |   |   | $ | 47,066,775 |   |
| Interest bearing transaction accounts |   |         | 65,655,251  |   |   |   | 50,575,875 |   |
| Savings                               |   |         | 28,644,040  |   |   |   | 27,560,647 |   |
| Time deposits $100,000 and over       |   |         | 130,244,731 |   |   |   | 128,914,487 |   |
| Other time deposits                   |   |         | 173,921,860 |   |   |   | 182,529,947 |   |
| Total deposits                        |   | $            | 445,310,008 |   |   | $ | 436,647,731 |   |

----

|  Year |   | Amount |        |
|------------|--------|--------|-------------|
|       |   |   |        |
| 2011       |   | $      | 230,630,969 |   |
| 2012       |   |   | 62,463,181  |   |
| 2013       |   |   | 3,145,581   |   |
| 2014       |   |   | 649,792     |   |
| 2015       |   |   | 7,277,068   |   |
| Thereafter |   |   | -           |   |

|                                       |   | December 31, |      |
|--------------------------------------------|--------|--------------|-----------|
|                                       |   | 2010         |      |   | 2009 |   |
|                                       |   |         |      |   |   |   |
| Short-term Federal Home Loan Bank advances |   | $            | 5,000,000 |   |   | $ | - |   |

|                            |   | December 31, |      |
|---------------------------------|--------|--------------|-----------|
|                            |   | 2010         |      |   | 2009 |   |
|                            |   |         |      |   |   |   |
| Fixed rate notes due to FHLB    |   | $            | -         |   |   | $ | 1,500,000 |   |
| Variable rate notes due to FHLB |   |         | 6,500,000 |   |   |   | 6,500,000 |   |
|                            |   | $            | 6,500,000 |   |   | $ | 8,000,000 |   |

----

|                                                                                                                     |   | December 31, 2010 |   |
|--------------------------------------------------------------------------------------------------------------------------|--------|-------------------|--------|
|                                                                                                                     |   | Fixed Rate        |   |   | Variable Rate |   |   | Total |   |
| Due to Federal Home Loan Bank:                                                                                           |   |              |   |   |   |   |   |   |   |
| Due 2013, interest rate 3.7475% convertible to variable rate at    lender's option on June 27, 2011  |   | $                 | -      |   |   | $ | 1,500,000 |   |   | $ | 1,500,000 |   |
| Due 2014, interest rate 3.9200% convertible to variable rate at    lender's option on March 18, 2011 |   |              | -      |   |   |   | 3,500,000 |   |   |   | 3,500,000 |   |
| Due 2015, interest rate 3.9250% convertible to variable rate at    lender's option on June 29, 2012  |   |              | -      |   |   |   | 1,500,000 |   |   |   | 1,500,000 |   |
| Total long-term debt                                                                                                     |   | $                 | -      |   |   | $ | 6,500,000 |   |   | $ | 6,500,000 |   |

----

|                                                                                             |                                           |   | Years Ended December 31, |      |
|--------------------------------------------------------------------------------------------------|------------------------------------------------|--------|--------------------------|-----------|
|                                                                                             |                                           |   | 2010                     |      |   | 2009 |   |   | 2008 |   |
| Net income per common share, basic                                                               |                                           |   |                     |      |   |   |   |   |   |
|     Numerator - net income available to common shareholders                       |                                           | $      | 935,710                  |      |   | $ | 1,100,714 |   |   | $ | 1,342,498 |   |
|     Denominator                                                                   |                                           |   |                     |      |   |   |   |   |   |   |   |   |   |
|         Weighted average common shares issued and outstanding |                                           |   | 3,972,761                |      |   |   | 3,972,864 |   |   |   | 3,906,277 |   |
|                                                                                             | Net income per common share, basic             |   | $                        | .24       |   |   | $ | .28 |   |   | $ | .34 |   |
|                                                                                             |                                           |   |                     |      |   |   |   |   |   |   |   |   |   |
| Net income per common share, assuming dilution                                                   |                                           |   |                     |      |   |   |   |   |   |   |   |   |
|     Numerator - net income available to common shareholders                       |                                           | $      | 935,710                  |      |   | $ | 1,100,714 |   |   | $ | 1,342,498 |   |
|     Denominator                                                                   |                                           |   |                     |      |   |   |   |   |   |   |   |   |   |
|         Weighted average common shares issued and outstanding |                                           |   | 3,972,761                |      |   |   | 3,972,864 |   |   |   | 3,906,277 |   |
|         Effect of dilutive stock options                      |                                           |   | -                        |      |   |   | - |   |   |   | 167,028 |   |
|                                                                                             | Total shares                                   |   |                     | 3,972,761 |   |   |   | 3,972,864 |   |   |   | 4,073,305 |   |
|                                                                                             | Net income per common share, assuming dilution |   | $                        | .24       |   |   | $ | .28 |   |   | $ | .33 |   |

----

|                                               |                         |   Actual |   |   Minimum forCapital Adequacy |   Minimum to beWell Capitalized  |
|----------------------------------------------------|------------------------------|---------------|--------|------------------------------------|--------------------------------------------|
|                                               |                         |          | Amount |                               |                                       |   | Ratio |   |   | Amount |   |   |   | Ratio |   | Amount |   |   | Ratio |
|                                               |  (Dollars in thousands) |
| December 31, 2010                                  |                         |          |   |                               |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| The Company                                        |                         |          |   |                               |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Total Capital to risk weighted assets       |                         | $             | 48,603 |                               |                                       |   | 15.7 | % |   | $ | 24,753 |   |   |   | 8.0 | % |   | NA |   |   | NA |   |
|   Tier 1 Capital to risk weighted assets      |                         | $             | 44,712 |                               |                                       |   | 14.5 | % |   | $ | 12,377 |   |   |   | 4.0 | % |   | NA |   |   | NA |   |
|   Tier 1 Capital to average assets (leverage) |                         | $             | 44,712 |                               |                                       |   | 8.8 | % |   | $ | 20,235 |   |   |   | 4.0 | % |   | NA |   |   | NA |   |
| Community First Bank                               |                         |          |   |                               |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Total Capital to risk weighted assets       |                         | $             | 43,340 |                               |                                       |   | 14.2 | % |   | $ | 24,445 |   |   |   | 8.0 | % |   | $ | 30,556 |   |   |   | 10.0 | % |
|   Tier 1 Capital to risk weighted assets      |                         | $             | 39,497 |                               |                                       |   | 12.9 | % |   | $ | 12,222 |   |   |   | 4.0 | % |   | $ | 18,334 |   |   |   | 6.0 | % |
|   Tier 1 Capital to average assets (leverage) |                         | $             | 39,497 |                               |                                       |   | 7.9 | % |   | $ | 20,083 |   |   |   | 4.0 | % |   | $ | 25,104 |   |   |   | 5.0 | % |
|                                               |                         |          |   |                               |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31, 2009                                  |                         |          |   |                               |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| The Company                                        |                         |          |   |                               |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Total Capital to risk weighted assets       |                         | $             | 48,127 |                               |                                       |   | 15.5 | % |   | $ | 24,769 |   |   |   | 8.0 | % |   | NA |   |   | NA |   |
|   Tier 1 Capital to risk weighted assets      |                         | $             | 44,230 |                               |                                       |   | 14.3 | % |   | $ | 12,385 |   |   |   | 4.0 | % |   | NA |   |   | NA |   |
|   Tier 1 Capital to average assets (leverage) |                         | $             | 44,230 |                               |                                       |   | 9.3 | % |   | $ | 18,991 |   |   |   | 4.0 | % |   | NA |   |   | NA |   |
| Community First Bank                               |                         |          |   |                               |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Total Capital to risk weighted assets       |                         | $             | 42,709 |                               |                                       |   | 14.0 | % |   | $ | 24,461 |   |   |   | 8.0 | % |   | $ | 30,577 |   |   |   | 10.0 | % |
|   Tier 1 Capital to risk weighted assets      |                         | $             | 38,859 |                               |                                       |   | 12.7 | % |   | $ | 12,231 |   |   |   | 4.0 | % |   | $ | 18,346 |   |   |   | 6.0 | % |
|   Tier 1 Capital to average assets (leverage) |                         | $             | 38,859 |                               |                                       |   | 8.2 | % |   | $ | 18,985 |   |   |   | 4.0 | % |   | $ | 23,732 |   |   |   | 5.0 | % |

|                                                |   | Year Ended December 31, 2010             |    |
|-----------------------------------------------------|--------|------------------------------------------|---------|
|                                                |   | Shares                                   |    |   | Weighted Average Exercise Price Per Share |   |   | Weighted Average Remaining Contractual Life (Years) |   |   | Aggregate Intrinsic Value |   |
|                                                |   | (Dollars in thousands, except per share) |    |
| Outstanding at beginning of year                    |   |                                     | 382,139 |   |   | $ | 11.25 |   |   |   |   |   |   |   |
| Granted                                             |   |                                     | -       |   |   |   | - |   |   |   |   |   |   |   |
| Exercised                                           |   |                                     | (1,830  | ) |   |   | 9.21 |   |   |   |   |   |   |   |
| Forfeited or expired                                |   |                                     | (71,220 | ) |   |   | 10.37 |   |   |   |   |   |   |   |
| Outstanding at end of year                          |   |                                     | 309,089 |   |   | $ | 11.82 |   |   |   | 2.75 |   |   | $ | - |   |
|                                                |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Options outstanding  and expected to vest |   |                                     | 309,089 |   |   | $ | 11.47 |   |   |   | 2.75 |   |   | $ | - |   |
|                                                |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Options exercisable at year-end                     |   |                                     | 309,089 |   |   | $ | 11.47 |   |   |   | 2.75 |   |   | $ | - |   |
| ___________________                                 |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

|                                      |   | Years Ended December 31, |       |
|-------------------------------------------|--------|--------------------------|------------|
|                                      |   | 2010                     |       |   | 2009 |   |   | 2008 |   |
|                                      |   |                     |       |   |   |   |   |   |   |
| Salaries and employee benefits            |   | $                        | 4,890,784  |   |   | $ | 4,931,004 |   |   | $ | 4,537,173 |   |
| Net occupancy expense                     |   |                     | 548,488    |   |   |   | 511,944 |   |   |   | 514,488 |   |
| Furniture and equipment expense           |   |                     | 368,599    |   |   |   | 392,392 |   |   |   | 429,850 |   |
| FDIC insurance expense                    |   |                     | 1,098,669  |   |   |   | 711,033 |   |   |   | 188,000 |   |
| Debit card transaction expense            |   |                     | 460,057    |   |   |   | 409,740 |   |   |   | 373,382 |   |
| Other expense                             |   |                     |       |   |   |   |   |   |   |   |   |   |
| Stationery, printing and postage          |   |                     | 334,287    |   |   |   | 314,351 |   |   |   | 328,126 |   |
| Telephone                                 |   |                     | 187,746    |   |   |   | 188,867 |   |   |   | 176,972 |   |
| Advertising and promotion                 |   |                     | 156,067    |   |   |   | 155,337 |   |   |   | 129,327 |   |
| Professional services                     |   |                     | 615,797    |   |   |   | 389,760 |   |   |   | 290,528 |   |
| Insurance                                 |   |                     | 58,611     |   |   |   | 48,056 |   |   |   | 57,384 |   |
| Directors' compensation                   |   |                     | 177,716    |   |   |   | 133,401 |   |   |   | 115,400 |   |
| Foreclosed assets costs and expenses, net |   |                     | 306,807    |   |   |   | 131,613 |   |   |   | 8,306 |   |
| Data processing expenses                  |   |                     | 402,781    |   |   |   | 436,364 |   |   |   | 357,561 |   |
|  Other                               |   |                     | 503,898    |   |   |   | 494,815 |   |   |   | 560,873 |   |
| Total                                     |   | $                        | 10,110,307 |   |   | $ | 9,248,677 |   |   | $ | 8,067,370 |   |

|                                                          |   |   | Years Ended December 31, |     |
|---------------------------------------------------------------|--------|--------|--------------------------|----------|
|                                                          |   |   | 2010                     |     |   | 2009 |   |   | 2008 |   |
| Current                                                       |   |   |                     |     |   |   |   |   |   |   |
| Federal                                                       |   |   | $                        | 320,479  |   |   | $ | 233,481 |   |   | $ | 1,146,790 |   |
| State                                                         |   |   |                     | 55,641   |   |   |   | 54,625 |   |   |   | 62,568 |   |
|         Total current |   |   |                     | 376,120  |   |   |   | 288,106 |   |   |   | 1,209,358 |   |
| Deferred                                                      |   |   |                     |     |   |   |   |   |   |   |   |   |   |
| Federal                                                       |   |   |                     | (274,286 | ) |   |   | (206,887 | ) |   |   | (956,973 | ) |
|   Total income tax expense                          |   | $      | 101,834                  |     |   | $ | 81,219 |   |   | $ | 252,385 |   |

----

|                                         |   | Years Ended December 31, |     |
|----------------------------------------------|--------|--------------------------|----------|
|                                         |   | 2010                     |     |   | 2009 |   |   | 2008 |   |
|                                         |   |                     |     |   |   |   |   |   |   |
| Provision for loan losses                    |   | $                        | 55,328   |   |   | $ | 21,363 |   |   | $ | (892,982 | ) |
| Accelerated depreciation                     |   |                     | (17,588  | ) |   |   | 9,783 |   |   |   | 87,063 |   |
| Deferred net loan costs and fees             |   |                     | 11,797   |   |   |   | 38,019 |   |   |   | (7,710 | ) |
| Deferred compensation expense                |   |                     | (179,315 | ) |   |   | (160,544 | ) |   |   | (143,344 | ) |
| Writedowns of foreclosed assets              |   |                     | (101,003 | ) |   |   | - |   |   |   | - |   |
| Excess charitable contributions carryforward |   |                     | 4,415    |   |   |   | (4,415 | ) |   |   | - |   |
| Nonaccrual loan interest                     |   |                     | (7,589   | ) |   |   | - |   |   |   | - |   |
| Alternative minimum tax credit carryforward  |   |                     | (40,331  | ) |   |   | (111,093 | ) |   |   | - |   |
| Total                                        |   | $                        | (274,286 | ) |   | $ | (206,887 | ) |   | $ | (956,973 | ) |

|                                                      |   | Years Ended December 31, |     |
|-----------------------------------------------------------|--------|--------------------------|----------|
|                                                      |   | 2010                     |     |   | 2009 |   |   | 2008 |   |
|                                                      |   |                     |     |   |   |   |   |   |   |
| Tax expense at statutory rate                             |   | $                        | 413,009  |   |   | $ | 401,857 |   |   | $ | 542,260 |   |
| State income tax, net of federal                          |   |                     |     |   |   |   |   |   |   |   |   |   |
| income tax benefit                                        |   |                     | 36,723   |   |   |   | 36,053 |   |   |   | 41,295 |   |
| Tax-exempt interest income                                |   |                     | (258,267 | ) |   |   | (274,727 | ) |   |   | (282,276 | ) |
| Non-deductible interest expense to                        |   |                     |     |   |   |   |   |   |   |   |   |   |
| carry tax-exempt instruments                              |   |                     | 21,313   |   |   |   | 30,394 |   |   |   | 41,195 |   |
| Non-taxable increase in value of life insurance contracts |   |                     | (128,163 | ) |   |   | (125,380 | ) |   |   | (127,504 | ) |
| Other, net                                                |   |                     | 17,219   |   |   |   | 13,022 |   |   |   | 37,415 |   |
| Total                                                     |   | $                        | 101,834  |   |   | $ | 81,219 |   |   | $ | 252,385 |   |

----

|                                               |   | December 31, |      |
|----------------------------------------------------|--------|--------------|-----------|
|                                               |   | 2010         |      |   | 2009 |   |
| Deferred tax assets                                |   |         |      |   |   |   |
| Allowance for loan losses                          |   | $            | 1,518,913 |   |   | $ | 1,574,241 |   |
| Deferred net loan fees                             |   |         | 84,108    |   |   |   | 95,905 |   |
| Nonaccrual loan interest                           |   |         | 7,589     |   |   |   | - |   |
| Writedowns of foreclosed assets                    |   |         | 101,003   |   |   |   | - |   |
| Non-qualified stock options                        |   |         | 96,088    |   |   |   | 96,088 |   |
| Deferred compensation                              |   |         | 610,807   |   |   |   | 431,492 |   |
|  Excess charitable contributions carryforward |   |         | -         |   |   |   | 4,415 |   |
|  Alternative minimum tax credit carryforward  |   |         | 151,424   |   |   |   | 111,093 |   |
| Gross deferred tax assets                          |   |         | 2,569,932 |   |   |   | 2,313,234 |   |
| Valuation allowance                                |   |         | -         |   |   |   | - |   |
| Total                                              |   |         | 2,569,932 |   |   |   | 2,313,234 |   |
|                                               |   |         |      |   |   |   |   |   |
| Deferred tax liabilities                           |   |         |      |   |   |   |   |   |
| Accelerated depreciation                           |   |         | 274,669   |   |   |   | 292,257 |   |
| Unrealized net holding gains on                    |   |         |      |   |   |   |   |   |
|   available-for-sale securities          |   |         | 61,899    |   |   |   | 329,095 |   |
| Gross deferred tax liabilities                     |   |         | 336,568   |   |   |   | 621,352 |   |
| Net deferred income tax assets                     |   | $            | 2,233,364 |   |   | $ | 1,691,882 |   |

----

|                      |   | December 31, |       |
|---------------------------|--------|--------------|------------|
|                      |   | 2010         |       |   | 2009 |   |
|                      |   |         |       |   |   |   |
| Loan commitments          |   | $            | 26,833,578 |   |   | $ | 28,527,000 |   |
| Standby letters of credit |   |         | 868,735    |   |   |   | 872,735 |   |

----

|                          |              |   | Fair Value Measurement at Reporting Date Using |   |
|-------------------------------|-------------------|--------|------------------------------------------------|--------|
|                          |              |   | Quoted Prices                                  |   |   |   |   |   |   |   |
|                          |              |   | in Active                                      |   |   | Significant |   |   |   |   |
|                          |              |   | Markets for                                    |   |   | Other |   |   | Significant |   |
|                          |              |   | Identical                                      |   |   | Observable |   |   | Unobservable |   |
|                          |              |   | Assets                                         |   |   | Inputs |   |   | Inputs |   |
| Description                   | December 31, 2010 |   | (Level 1)                                      |   |   | (Level 2) |   |   | (Level 3) |   |
| Securities available-for-sale |              |   | $                                              | -      |   |   | $ | 169,368,635 |   |   | $ | - |   |
|                          |              |   |                                           |   |   |   |   |   |   |   |   |   |   |
|                          | December 31, 2009 |   |                                           |   |   |   |   |   |   |   |   |   |   |
| Securities available-for-sale |              |   | $                                              | -      |   |   | $ | 141,710,113 |   |   | $ | - |   |

|                                |              |   | Fair Value Measurement at Reporting Date Using |   |
|-------------------------------------|-------------------|--------|------------------------------------------------|--------|
|                                |              |   | Quoted Prices                                  |   |   |   |   |   |   |   |   |   |   |
|                                |              |   | in Active                                      |   |   | Significant |   |   |   |   |   |   |   |
|                                |              |   | Markets for                                    |   |   | Other |   |   | Significant |   |   |   |   |
|                                |              |   | Identical                                      |   |   | Observable |   |   | Unobservable |   |   | Total |   |
|                                |              |   | Assets                                         |   |   | Inputs |   |   | Inputs |   |   | Gains |   |
| Description                         | December 31, 2010 |   | (Level 1)                                      |   |   | (Level 2) |   |   | (Level 3) |   |   | (Losses) |   |
| Collateral dependent impaired loans |              |   | $                                              | -      |   |   | $ | 20,311,928 |   |   | $ | - |   |   | $ | - |   |
| Land held for sale                  |              |   |                                           | -      |   |   |   | 138,551 |   |   |   | - |   |   |   | - |   |
| Foreclosed assets                   |              |   |                                           | -      |   |   |   | 11,394,924 |   |   |   | - |   |   |   | - |   |
|                                |              |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                | December 31, 2009 |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Collateral dependent impaired loans |              |   | $                                              | -      |   |   | $ | 11,219,306 |   |   | $ | - |   |   | $ | - |   |
| Land held for sale                  |              |   |                                           | -      |   |   |   | 138,551 |   |   |   | - |   |   |   | - |   |
| Foreclosed assets                   |              |   |                                           | -      |   |   |   | 6,077,475 |   |   |   | - |   |   |   | - |   |

----

----

|                                                             |   |  December 31, |        |
|------------------------------------------------------------------|--------|--------------------|-------------|
|                                                             |   | 2010               |        |   | 2009 |   |
|                                                             |   | Carrying           |        |   | Estimated |   |   | Carrying |   |   | Estimated |   |
|                                                             |   | Amount             |        |   | Fair Value |   |   | Amount |   |   | Fair Value |   |
| Financial assets                                                 |   |               |        |   |   |   |   |   |   |   |   |   |
|     Cash and due from banks                  |   | $                  | 1,711,068   |   |   | $ | 1,711,068 |   |   | $ | 1,462,535 |   |   | $ | 1,462,535 |   |
|     Interest bearing deposits due from banks |   |               | 39,170,864  |   |   |   | 39,170,864 |   |   |   | 46,020,551 |   |   |   | 46,020,551 |   |
|     Securities available-for-sale            |   |               | 169,368,635 |   |   |   | 169,368,635 |   |   |   | 141,710,113 |   |   |   | 141,710,113 |   |
|     Securities held-to-maturity              |   |               | 6,388,693   |   |   |   | 6,816,698 |   |   |   | 9,023,999 |   |   |   | 9,476,399 |   |
|     Federal Home Loan Bank stock             |   |               | 1,362,800   |   |   |   | 1,362,800 |   |   |   | 1,306,500 |   |   |   | 1,306,500 |   |
|     Loans, net                               |   |               | 251,078,508 |   |   |   | 252,385,000 |   |   |   | 261,196,297 |   |   |   | 262,308,000 |   |
|     Accrued interest receivable              |   |               | 2,491,378   |   |   |   | 2,491,378 |   |   |   | 2,424,113 |   |   |   | 2,424,113 |   |
| Financial liabilities                                            |   |               |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Deposits                                 |   |               | 445,310,008 |   |   |   | 446,763,000 |   |   |   | 436,647,731 |   |   |   | 436,444,000 |   |
|     Accrued interest payable                 |   |               | 1,698,204   |   |   |   | 1,698,204 |   |   |   | 2,043,563 |   |   |   | 2,043,563 |   |
|     Short-term borrowings                    |   |               | 5,000,000   |   |   |   | 5,000,000 |   |   |   | - |   |   |   | - |   |
|     Long-term debt                           |   |               | 6,500,000   |   |   |   | 6,528,000 |   |   |   | 8,000,000 |   |   |   | 8,005,000 |   |

|                                              |   |  December 31, |       |
|---------------------------------------------------|--------|--------------------|------------|
|                                              |   | 2010               |       |   | 2009 |   |
|                                              |   | Notional/          |       |   | Estimated |   |   | Notional/ |   |   | Estimated |   |
|                                              |   | Contract           |       |   | Fair |   |   | Contract |   |   | Fair |   |
|                                              |   | Amount             |       |   | Value |   |   | Amount |   |   | Value |   |
| Off-balance sheet commitments                     |   |               |       |   |   |   |   |   |   |   |   |   |
|     Loan commitments          |   | $                  | 26,833,578 |   |   | $ | - |   |   | $ | 28,527,000 |   |   | $ | - |   |
|     Standby letters of credit |   |               | 868,735    |   |   |   | - |   |   |   | 872,735 |   |   |   | - |   |

----

|                                       |   | December 31, |       |
|--------------------------------------------|--------|--------------|------------|
|                                       |   | 2010         |       |   | 2009 |   |
| Condensed Balance Sheets                   |   |         |       |   |   |   |
| Assets                                     |   |         |       |   |   |   |
|    Cash                     |   | $            | 766,351    |   |   | $ | 1,024,131 |   |
| Investment in banking subsidiary           |   |         | 40,206,729 |   |   |   | 39,447,333 |   |
| Investment in nonbanking subsidiary        |   |         | 4,140,850  |   |   |   | 4,150,000 |   |
| Land held for sale                         |   |         | 138,551    |   |   |   | 138,551 |   |
|    Other assets             |   |         | 58,948     |   |   |   | 58,296 |   |
| Total assets                               |   | $            | 45,311,429 |   |   | $ | 44,818,311 |   |
|                                       |   |         |       |   |   |   |   |   |
| Liabilities                                |   | $            | -          |   |   | $ | - |   |
| Shareholders' equity                       |   |         | 45,311,429 |   |   |   | 44,818,311 |   |
| Total liabilities and shareholders' equity |   | $            | 45,311,429 |   |   | $ | 44,818,311 |   |

|                                            |   | Years Ended December 31, |      |
|-------------------------------------------------|--------|--------------------------|-----------|
|                                            |   | 2010                     |      |   | 2009 |   |   | 2008 |   |
| Condensed Statements of Income                  |   |                     |      |   |   |   |   |   |   |
| Income                                          |   |                     |      |   |   |   |   |   |   |
| Interest income                                 |   | $                        | 11,147    |   |   | $ | 13,690 |   |   | $ | 27,590 |   |
| Total income                                    |   |                     | 11,147    |   |   |   | 13,690 |   |   |   | 27,590 |   |
| Expenses                                        |   |                     |      |   |   |   |   |   |   |   |   |   |
| Interest expense                                |   |                     | -         |   |   |   | 47,119 |   |   |   | - |   |
| Other expenses                                  |   |                     | 184,524   |   |   |   | 138,030 |   |   |   | 100,163 |   |
| Total expenses                                  |   |                     | 184,524   |   |   |   | 185,149 |   |   |   | 100,163 |   |
| Income (loss) before income taxes and equity in |   |                     |      |   |   |   |   |   |   |   |   |   |
| undistributed earnings of subsidiaries          |   |                     | (173,377  | ) |   |   | (171,459 | ) |   |   | (72,573 | ) |
| Income tax expense (credit)                     |   |                     | (58,948   | ) |   |   | (58,296 | ) |   |   | (24,675 | ) |
| Equity in undistributed earnings                |   |                     |      |   |   |   |   |   |   |   |   |   |
| of banking subsidiary                           |   |                     | 1,236,477 |   |   |   | 1,213,877 |   |   |   | 1,390,396 |   |
| Equity in undistributed earnings (loss)         |   |                     |      |   |   |   |   |   |   |   |   |   |
| of nonbanking subsidiary                        |   |                     | (9,150    | ) |   |   | - |   |   |   | - |   |
| Net income                                      |   | $                        | 1,112,898 |   |   | $ | 1,100,714 |   |   | $ | 1,342,498 |   |

----

|                                                         |   | Years Ended December 31, |       |
|--------------------------------------------------------------|--------|--------------------------|------------|
|                                                         |   | 2010                     |       |   | 2009 |   |   | 2008 |   |
| Condensed Statements of Cash Flows                           |   |                     |       |   |   |   |   |   |   |
| Operating activities                                         |   |                     |       |   |   |   |   |   |   |
|      Net income                          |   | $                        | 1,112,898  |   |   | $ | 1,100,714 |   |   | $ | 1,342,498 |   |
|   Adjustments to reconcile net income to net       |   |                     |       |   |   |   |   |   |   |   |   |   |
| cash used by operating activities                            |   |                     |       |   |   |   |   |   |   |   |   |   |
| Equity in undistributed earnings                             |   |                     |       |   |   |   |   |   |   |   |   |   |
|   of banking subsidiary                            |   |                     | (1,236,477 | ) |   |   | (1,213,877 | ) |   |   | (1,390,396 | ) |
| Equity in undistributed loss                                 |   |                     |       |   |   |   |   |   |   |   |   |   |
|   of nonbanking subsidiary                         |   |                     | 9,150      |   |   |   | - |   |   |   | - |   |
| Increase in other assets                                     |   |                     | (652       | ) |   |   | (33,621 | ) |   |   | (16,743 | ) |
| Other                                                        |   |                     | (2         | ) |   |   | - |   |   |   | 2 |   |
|   Net cash used by operating activities            |   |                     | (115,083   | ) |   |   | (146,784 | ) |   |   | (64,639 | ) |
| Investing activities                                         |   |                     |       |   |   |   |   |   |   |   |   |   |
|      Investment in nonbanking subsidiary |   |                     | -          |   |   |   | (4,150,000 | ) |   |   | - |   |
|   Purchase of land held for sale                        |   |                     | -          |   |   |   | - |   |   |   | (138,551 | ) |
| Net cash used by investing activities                        |   |                     | -          |   |   |   | (4,150,000 | ) |   |   | (138,551 | ) |
| Financing activities                                         |   |                     |       |   |   |   |   |   |   |   |   |   |
| Exercise of employee stock options                           |   |                     | 16,873     |   |   |   | 486,232 |   |   |   | 364,535 |   |
| Net proceeds from issuing preferred stock                    |   |                     |       |   |   |   |   |   |   |   |   |   |
| (costs of $23,785)                                           |   |                     | -          |   |   |   | 3,126,215 |   |   |   | - |   |
| Common stock repurchased and cancelled                       |   |                     | -          |   |   |   | (79,985 | ) |   |   | - |   |
| Payment of dividends on preferred stock                      |   |                     | (157,500   | ) |   |   | - |   |   |   | - |   |
| Payment of cash in lieu of fractional                        |   |                     |       |   |   |   |   |   |   |   |   |   |
| shares for common stock dividend                             |   |                     | (2,070     | ) |   |   | (6,515 | ) |   |   | - |   |
|   Net cash (used) provided by financing activities |   |                     | (142,697   | ) |   |   | 3,525,947 |   |   |   | 364,535 |   |
| (Decrease) increase in cash and cash equivalents             |   |                     | (257,780   | ) |   |   | (770,837 | ) |   |   | 161,345 |   |
| Cash and cash equivalents, beginning                         |   |                     | 1,024,131  |   |   |   | 1,794,968 |   |   |   | 1,633,623 |   |
| Cash and cash equivalents, ending                            |   | $                        | 766,351    |   |   | $ | 1,024,131 |   |   | $ | 1,794,968 |   |