##### Table of Contents





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549





FORM 10-Q





(Mark One)

|x | Quarterly report under section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ---------------------------------------------------------------------------------

For the Quarterly Period Ended March 31, 2009

or



| ̈ | Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ----------------------------------------------------------------------------------------

For the Transition Period from              to

Commission File Number 33-76644





COMMUNITYCORP

(Exact name of registrant as specified in its charter)







|                                               |  |                                     
|---------------------------------------------- |  | ------------------------------------
|South Carolina                                 |  | 57-1019001                          
|(State or other jurisdiction of incorporation) |  | (I.R.S. Employer Identification No.)

1100 N. Jefferies Boulevard

Walterboro, SC 29488

(Address of principal executive offices, including zip
code)

(843) 549-2265

(Issurers telephone number, including area code)





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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    YES
   ̈    NO   ̈

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



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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act).    YES   ̈    NO  x

Indicate the number of shares outstanding of each of the issuers classes of common stock as of the latest practicable date:

234,358 shares of common stock, $5.00 par value, as of April 13, 2009









---

##### Table of Contents

COMMUNITYCORP

Index



|                                |  |                                                                                                                                      |  |        
|------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------ |  | -------
|                                |  | Page No.                                                                                                                            
|PART I. - FINANCIAL INFORMATION |  |                                                                                                                                     
|                                |  |                                                                                                                                     
|Item 1.                         |  | Financial Statements (Unaudited)                                                                                                     |  |        
|                                |  |                                                                                                                                     
|                                |  | Condensed Consolidated Balance Sheets - March 31, 2009 and December 31, 2008                                                         |  | 3      
|                                |  |                                                                                                                                     
|                                |  | Condensed Consolidated Statements of Income - Three months ended March 31, 2009 and 2008                                             |  | 4      
|                                |  |                                                                                                                                     
|                                |  | Condensed Consolidated Statements of Changes in Shareholders Equity and Comprehensive Income - Three months March 31, 2009 and 2008 |  | 5      
|                                |  |                                                                                                                                     
|                                |  | Condensed Consolidated Statements of Cash Flows - Three months ended March 31, 2009 and 2008                                         |  | 6      
|                                |  |                                                                                                                                     
|                                |  | Notes to Condensed Consolidated Financial Statements                                                                                 |  | 7 - 9  
|                                |  |                                                                                                                                     
|Item 2.                         |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                                                |  | 10 - 17
|                                |  |                                                                                                                                     
|Item 3.                         |  | Quantitative and Qualitative Disclosure About Market Risk                                                                            |  | 17     
|                                |  |                                                                                                                                     
|Item 4.                         |  | Controls and Procedures                                                                                                              |  | 17     
|                                | 
|PART II. - OTHER INFORMATION    |  |                                                                                                                                     
|                                |  |                                                                                                                                     
|Item 1.                         |  | Legal Proceedings                                                                                                                    |  | 18     
|                                |  |                                                                                                                                     
|Item 1A.                        |  | Risk Factors                                                                                                                         |  | 18     
|                                |  |                                                                                                                                     
|Item 2.                         |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                                          |  | 18     
|                                |  |                                                                                                                                     
|Item 3.                         |  | Defaults Under Senior Securities                                                                                                     |  | 18     
|                                |  |                                                                                                                                     
|Item 4.                         |  | Submission of Matters to a Vote of Security Holders                                                                                  |  | 18     
|                                |  |                                                                                                                                     
|Item 5.                         |  | Other Information                                                                                                                    |  | 18     
|                                |  |                                                                                                                                     
|Item 6.                         |  | Exhibits                                                                                                                             |  | 18     
|                                | 
|Signatures                      |  | 19                                                                                                                                  



---

##### Table of Contents

COMMUNITYCORP

PART I.  Financial Information



|Item 1. | Financial Statements
|------- | --------------------

Condensed Consolidated Balance Sheets



|                                                                                                                             |  |               |             |   |                  |   |             |  
|---------------------------------------------------------------------------------------------------------------------------- |  | ------------- | ----------- | - | ---------------- | - | ----------- | -
|                                                                                                                             |  | March 31,2009 |             |   | December 31,2008 |  
|                                                                                                                             |  | (Unaudited)   |             |   | (Audited)        |  
|Assets:                                                                                                                      |  |               |             |   |                  |   |             |  
|Cash and cash equivalents:                                                                                                   |  |               |             |   |                  |   |             |  
|Cash and due from banks                                                                                                      |  | $             | 14,539,285  |   |                  | $ | 3,468,965   |  
|Federal funds sold                                                                                                           |  |               | 3,400,000   |   |                  |   | 13,146,000  |  
|                                                                                                                             |  |               |             |   |                  |   |             |  
|Total cash and cash equivalents                                                                                              |  |               | 17,939,285  |   |                  |   | 16,614,965  |  
|                                                                                                                             |  |               |             |   |                  |   |             |  
|                                                                                                                             |  |              
|Time deposits with other banks                                                                                               |  |               | 1,500,000   |   |                  |   | 1,500,000   |  
|                                                                                                                             |  |              
|Investment securities:                                                                                                       |  |               |             |   |                  |   |             |  
|Available-for-sale                                                                                                           |  |               | 23,855,159  |   |                  |   | 27,815,275  |  
|Held-to-maturity (estimated market value of $1,226,519 and $1,335,226 at March 31, 2009 and December 31, 2008,
respectively) |  |               | 1,219,647   |   |                  |   | 1,319,596   |  
|Nonmarketable equity securities                                                                                              |  |               | 302,400     |   |                  |   | 508,435     |  
|                                                                                                                             |  |               |             |   |                  |   |             |  
|Total investment securities                                                                                                  |  |               | 25,377,206  |   |                  |   | 29,643,306  |  
|                                                                                                                             |  |               |             |   |                  |   |             |  
|                                                                                                                             |  |              
|Loans receivable                                                                                                             |  |               | 116,534,721 |   |                  |   | 113,704,520 |  
|Less allowance for loan losses                                                                                               |  |               | (2,053,259  | ) |                  |   | (1,981,637  | )
|                                                                                                                             |  |               |             |   |                  |   |             |  
|Loans, net                                                                                                                   |  |               | 114,481,462 |   |                  |   | 111,722,883 |  
|                                                                                                                             |  |              
|Premises, furniture & equipment, net                                                                                         |  |               | 3,007,637   |   |                  |   | 3,028,604   |  
|Accrued interest receivable                                                                                                  |  |               | 1,072,149   |   |                  |   | 1,125,714   |  
|Other real estate owned                                                                                                      |  |               | 75,000      |   |                  |   | 75,000      |  
|Other assets                                                                                                                 |  |               | 685,241     |   |                  |   | 874,815     |  
|                                                                                                                             |  |               |             |   |                  |   |             |  
|                                                                                                                             |  |              
|Total assets                                                                                                                 |  | $             | 164,137,980 |   |                  | $ | 164,585,287 |  
|                                                                                                                             |  |               |             |   |                  |   |             |  
|                                                                                                                             |  |              
|Liabilities and Shareholders Equity:                                                                                        |  |               |             |   |                  |   |             |  
|Liabilities:                                                                                                                 |  |               |             |   |                  |   |             |  
|Deposits:                                                                                                                    |  |               |             |   |                  |   |             |  
|Noninterest-bearing                                                                                                          |  | $             | 14,810,128  |   |                  | $ | 15,652,393  |  
|Interest-bearing                                                                                                             |  |               | 130,880,892 |   |                  |   | 130,061,592 |  
|                                                                                                                             |  |               |             |   |                  |   |             |  
|Total deposits                                                                                                               |  |               | 145,691,020 |   |                  |   | 145,713,985 |  
|                                                                                                                             |  |              
|Accrued interest payable                                                                                                     |  |               | 895,027     |   |                  |   | 953,278     |  
|Other liabilities                                                                                                            |  |               | 163,568     |   |                  |   | 224,606     |  
|                                                                                                                             |  |               |             |   |                  |   |             |  
|Total liabilities                                                                                                            |  |               | 146,749,615 |   |                  |   | 146,891,869 |  
|                                                                                                                             |  |               |             |   |                  |   |             |  
|                                                                                                                             |  |              
|Shareholders Equity:                                                                                                        |  |               |             |   |                  |   |             |  
|Preferred stock, $5 par value, 3,000,000 shares authorized and unissued                                                      |  |               |            |   |                  |   |            |  
|Common stock, $5 par value, 3,000,000 shares authorized, 300,000 shares issued and outstanding                               |  |               | 1,500,000   |   |                  |   | 1,500,000   |  
|Capital surplus                                                                                                              |  |               | 1,728,328   |   |                  |   | 1,728,328   |  
|Retained earnings                                                                                                            |  |               | 18,121,044  |   |                  |   | 18,392,614  |  
|Accumulated other comprehensive income                                                                                       |  |               | 171,738     |   |                  |   | 75,701      |  
|Treasury stock (64,742 shares in 2009 and 63,123 shares in 2008)                                                             |  |               | (4,132,745  | ) |                  |   | (4,003,225  | )
|                                                                                                                             |  |               |             |   |                  |   |             |  
|Total shareholders equity                                                                                                   |  |               | 17,388,365  |   |                  |   | 17,693,418  |  
|                                                                                                                             |  |               |             |   |                  |   |             |  
|                                                                                                                             |  |              
|Total liabilities and shareholders equity                                                                                   |  | $             | 164,137,980 |   |                  | $ | 164,585,287 |  
|                                                                                                                             |  |               |             |   |                  |   |             |  

See notes to condensed consolidated financial statements.



3



---

##### Table of Contents

COMMUNITYCORP

Condensed Consolidated Statements of Income

(Unaudited)



|                                                    |  |                             |           |   |      |   |          
|--------------------------------------------------- |  | --------------------------- | --------- | - | ---- | - | ---------
|                                                    |  | Three Months EndedMarch 31,
|                                                    |  | 2009                        |           |   | 2008
|Interest income:                                    |  |                             |           |   |      |   |          
|Loans, including fees                               |  | $                           | 1,986,170 |   |      | $ | 2,147,120
|Securities                                          |  |                             | 272,672   |   |      |   | 400,623  
|Other interest income                               |  |                             | 16,380    |   |      |   | 53,624   
|                                                    |  |                             |           |   |      |   |          
|Total                                               |  |                             | 2,275,222 |   |      |   | 2,601,367
|                                                    |  |                             |           |   |      |   |          
|                                                    |  |                            
|Interest expense:                                   |  |                             |           |   |      |   |          
|Deposit accounts                                    |  |                             | 922,528   |   |      |   | 1,194,133
|Other interest expense                              |  |                             | 7         |   |      |   | 4,774    
|                                                    |  |                             |           |   |      |   |          
|                                                    |  |                             | 922,535   |   |      |   | 1,198,907
|                                                    |  |                             |           |   |      |   |          
|                                                    |  |                            
|Net interest income                                 |  |                             | 1,352,687 |   |      |   | 1,402,460
|                                                    |  |                            
|Provision for loan losses                           |  |                             | 90,000    |   |      |   | 75,000   
|                                                    |  |                             |           |   |      |   |          
|                                                    |  |                            
|Net interest income after provision for loan losses |  |                             | 1,262,687 |   |      |   | 1,327,460
|                                                    |  |                             |           |   |      |   |          
|                                                    |  |                            
|Noninterest income:                                 |  |                             |           |   |      |   |          
|Service charges                                     |  |                             | 129,002   |   |      |   | 124,544  
|Other income                                        |  |                             | 42,957    |   |      |   | 44,372   
|                                                    |  |                             |           |   |      |   |          
|Total                                               |  |                             | 171,959   |   |      |   | 168,916  
|                                                    |  |                             |           |   |      |   |          
|                                                    |  |                            
|Noninterest expenses:                               |  |                             |           |   |      |   |          
|Salaries and benefits                               |  |                             | 510,491   |   |      |   | 496,081  
|Net occupancy expense                               |  |                             | 66,496    |   |      |   | 58,698   
|Equipment expense                                   |  |                             | 89,838    |   |      |   | 77,643   
|Other operating expenses                            |  |                             | 725,702   |   |      |   | 291,524  
|                                                    |  |                             |           |   |      |   |          
|Total                                               |  |                             | 1,392,527 |   |      |   | 923,946  
|                                                    |  |                             |           |   |      |   |          
|                                                    |  |                            
|Income before taxes                                 |  |                             | 42,119    |   |      |   | 572,430  
|                                                    |  |                            
|Income tax provision                                |  |                             | 61,000    |   |      |   | 177,300  
|                                                    |  |                             |           |   |      |   |          
|                                                    |  |                            
|Net income (loss)                                   |  | $                           | (18,881   | ) |      | $ | 395,130  
|                                                    |  |                             |           |   |      |   |          
|                                                    |  |                            
|Earnings per share:                                 |  |                             |           |   |      |   |          
|                                                    |  |                            
|Weighted average common shares outstanding          |  |                             | 236,175   |   |      |   | 240,454  
|                                                    |  |                             |           |   |      |   |          
|                                                    |  |                            
|Net income (loss) per common share                  |  | $                           | (.08      | ) |      | $ | 1.64     
|                                                    |  |                             |           |   |      |   |          

See notes to condensed consolidated financial statements.



4



---

##### Table of Contents

COMMUNITYCORP

Condensed Consolidated Statement of Shareholders Equity and Comprehensive Income (Loss)

for the three months ended March 31, 2009 and 2008

(Unaudited)



|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  
|--------------------------------------------------------- |  | ------------ |  | -------------- | --------- | ----------------------------------------- | - | ---------------- |  | - | ------------- |  | - | ---------- | - |  | - | ---------- | - |  | - | ---------- | -
|                                                          |  | Common stock |  | CapitalSurplus |           | AccumulatedOtherComprehensiveIncome(Loss) |   | RetainedEarnings |  |   | TreasuryStock |  |   | Total      |  
|                                                          |  |              |  |                |          
|                                                          |  |              |  |                |          
|                                                          |  | Shares       |  | Amount         |           |                                           |   |                  | 
|Balance, December 31, 2007                                |  | 300,000      |  | $              | 1,500,000 |                                           | $ | 1,723,196        |  | $ | 70,928        |  | $ | 17,153,490 |   |  | $ | (3,711,213 | ) |  | $ | 16,736,401 |  
|                                                          |  |              |  |                |           |                                           |  
|Cash dividends paid ($1.05 per share)                     |  |              |  |                |           |                                           |   |                  |  |   |               |  |   | (252,537   | ) |  |   |            |   |  |   | (252,537   | )
|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  
|                                                          |  |              |  |                |           |                                           |  
|Net income for the period                                 |  |              |  |                |           |                                           |   |                  |  |   |               |  |   | 395,130    |   |  |   |            |   |  |   | 395,130    |  
|                                                          |  |              |  |                |           |                                           |  
|Other comprehensive income, net of tax expense of $67,224 |  |              |  |                |           |                                           |   |                  |  |   | 121,437       |  |   |            |   |  |   |            |   |  |   | 121,437    |  
|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  
|                                                          |  |              |  |                |           |                                           |  
|Comprehensive income                                      |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   | 516,567    |  
|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  
|                                                          |  |              |  |                |           |                                           |  
|Sale of treasury stock                                    |  |              |  |                |           |                                           |   | 2,645            |  |   |               |  |   |            |   |  |   | 9,355      |   |  |   | 12,000     |  
|                                                          |  |              |  |                |           |                                           |  
|Purchase of treasury stock                                |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   | (16,000    | ) |  |   | (16,000    | )
|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  
|                                                          |  |              |  |                |           |                                           |  
|Balance, March 31, 2008                                   |  | 300,000      |  | $              | 1,500,000 |                                           | $ | 1,725,841        |  | $ | 192,365       |  | $ | 17,296,083 |   |  | $ | (3,717,858 | ) |  | $ | 16,996,431 |  
|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  
|                                                          |  |              |  |                |           |                                           |  
|Balance, December 31, 2008                                |  | 300,000      |  | $              | 1,500,000 |                                           | $ | 1,728,328        |  | $ | 75,701        |  | $ | 18,392,614 |   |  | $ | (4,003,225 | ) |  | $ | 17,693,418 |  
|                                                          |  |              |  |                |           |                                           |  
|Cash dividends paid ($1.07 per share)                     |  |              |  |                |           |                                           |   |                  |  |   |               |  |   | (252,689   | ) |  |   |            |   |  |   | (252,689   | )
|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  
|                                                          |  |              |  |                |           |                                           |  
|Net income (loss) for the period                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   | (18,881    | ) |  |   |            |   |  |   | (18,881    | )
|                                                          |  |              |  |                |           |                                           |  
|Other comprehensive income, net of tax expense of $50,584 |  |              |  |                |           |                                           |   |                  |  |   | 96,037        |  |   |            |   |  |   |            |   |  |   | 96,037     |  
|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  
|                                                          |  |              |  |                |           |                                           |  
|Comprehensive income                                      |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   | 77,156     |  
|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  
|                                                          |  |              |  |                |           |                                           |  
|Purchase of treasury stock                                |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   | (129,520   | ) |  |   | (129,520   | )
|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  
|                                                          |  |              |  |                |           |                                           |  
|Balance, March 31, 2009                                   |  | 300,000      |  | $              | 1,500,000 |                                           | $ | 1,728,328        |  | $ | 171,738       |  | $ | 18,121,044 |   |  | $ | (4,132,745 | ) |  | $ | 17,388,365 |  
|                                                          |  |              |  |                |           |                                           |   |                  |  |   |               |  |   |            |   |  |   |            |   |  |   |            |  

See notes to condensed consolidated financial statements.



5



---

##### Table of Contents

COMMUNITYCORP

Condensed Consolidated Statements of Cash Flows

(Unaudited)



|                                                                                                |  |                              |            |   |      |   |            |  
|----------------------------------------------------------------------------------------------- |  | ---------------------------- | ---------- | - | ---- | - | ---------- | -
|                                                                                                |  | Three Months Ended March 31, |           
|                                                                                                |  | 2009                         |            |   | 2008 |  
|Cash flows from operating activities:                                                           |  |                              |            |   |      |   |            |  
|Net income (loss)                                                                               |  | $                            | (18,881    | ) |      | $ | 395,130    |  
|Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities: |  |                              |            |   |      |   |            |  
|Provision for loan losses                                                                       |  |                              | 90,000     |   |      |   | 75,000     |  
|Depreciation expense                                                                            |  |                              | 67,219     |   |      |   | 53,685     |  
|Net premium amortization (accretion) of investment securities                                   |  |                              | 16,407     |   |      |   | (13,111    | )
|Net amortization (accretion) of loan fees and costs                                             |  |                              | (5,506     | ) |      |   | 3,728      |  
|Write down of securities available for sale                                                     |  |                              | 250,000    |   |      |   |           |  
|Write down of nonmarketable equity securities                                                   |  |                              | 211,935    |   |      |   |           |  
|Decrease in accrued interest receivable                                                         |  |                              | 53,565     |   |      |   | 135,236    |  
|Decrease in accrued interest payable                                                            |  |                              | (58,251    | ) |      |   | (30,610    | )
|(Increase) decrease in other assets                                                             |  |                              | 189,574    |   |      |   | (9,969     | )
|Decrease in other liabilities                                                                   |  |                              | (111,622   | ) |      |   | (5,905     | )
|                                                                                                |  |                              |            |   |      |   |            |  
|Net cash provided by operating activities                                                       |  |                              | 684,440    |   |      |   | 603,184    |  
|                                                                                                |  |                              |            |   |      |   |            |  
|                                                                                                |  |                             
|Cash flows from investing activities:                                                           |  |                              |            |   |      |   |            |  
|Proceeds from maturities of securities available-for-sale                                       |  |                              | 8,463,771  |   |      |   | 10,935,013 |  
|Purchases of securities available-for-sale                                                      |  |                              | (4,624,492 | ) |      |   | (7,803,710 | )
|Proceeds from maturities of securities held-to-maturity                                         |  |                              | 101,000    |   |      |   | 500,000    |  
|Purchases of nonmarketable equity securities                                                    |  |                              | (5,900     | ) |      |   | (161,178   | )
|Net (increase) decrease in loans to customers                                                   |  |                              | (2,843,073 | ) |      |   | 1,985,192  |  
|Purchases of premises and equipment                                                             |  |                              | (46,252    | ) |      |   | (19,612    | )
|                                                                                                |  |                              |            |   |      |   |            |  
|Net cash provided by investing activities                                                       |  |                              | 1,045,054  |   |      |   | 5,435,705  |  
|                                                                                                |  |                              |            |   |      |   |            |  
|                                                                                                |  |                             
|Cash flows from financing activities:                                                           |  |                              |            |   |      |   |            |  
|Net increase in demand deposits, interest-bearing transaction accounts and savings accounts     |  |                              | 1,488,981  |   |      |   | 5,602,892  |  
|Net increase (decrease) in time deposits                                                        |  |                              | (1,511,946 | ) |      |   | 3,239,577  |  
|Net decrease in short-term borrowings                                                           |  |                              |           |   |      |   | (2,838,000 | )
|Cash dividends paid                                                                             |  |                              | (252,689   | ) |      |   | (252,537   | )
|Purchase of treasury stock                                                                      |  |                              | (129,520   | ) |      |   | (16,000    | )
|Sale of treasury stock                                                                          |  |                              |           |   |      |   | 12,000     |  
|                                                                                                |  |                              |            |   |      |   |            |  
|Net cash provided (used) by financing activities                                                |  |                              | (405,174   | ) |      |   | 5,747,932  |  
|                                                                                                |  |                              |            |   |      |   |            |  
|                                                                                                |  |                             
|Net increase in cash and cash equivalents                                                       |  |                              | 1,324,320  |   |      |   | 11,786,821 |  
|                                                                                                |  |                             
|Cash and cash equivalents, beginning of period                                                  |  |                              | 16,614,965 |   |      |   | 6,920,768  |  
|                                                                                                |  |                              |            |   |      |   |            |  
|                                                                                                |  |                             
|Cash and cash equivalents, end of period                                                        |  | $                            | 17,939,285 |   |      | $ | 18,707,589 |  
|                                                                                                |  |                              |            |   |      |   |            |  
|                                                                                                |  |                             
|Cash paid during the period for:                                                                |  |                              |            |   |      |   |            |  
|                                                                                                |  |                             
|Income taxes                                                                                    |  | $                            | 87,700     |   |      | $ | 227,000    |  
|Interest                                                                                        |  | $                            | 980,786    |   |      | $ | 1,229,517  |  

See notes to condensed consolidated financial statements.



6



---

##### Table of Contents

COMMUNITYCORP

Notes to Condensed Consolidated Financial Statements

NOTE 1  BASIS OF PRESENTATION

The accompanying consolidated financial statements have been prepared in accordance with the requirements for interim financial statements and,
accordingly, they are condensed and omit disclosures, which would substantially duplicate those contained in the most recent annual report to shareholders. The financial statements as of March 31, 2009 and for the interim periods ended
March 31, 2009 and 2008 are unaudited and, in our opinion, include all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation. The results of operations for the three months ended March 31,
2009 are not necessarily indicative of the results which may be expected for the entire calendar year. The financial information as of December 31, 2008 has been derived from the audited financial statements as of that date. For further
information, refer to the financial statements and the notes included in Communitycorps 2008 Annual Report.

NOTE 2  COMPREHENSIVE INCOME

The components of other comprehensive income and related tax effects are as follows:



|                                                                      |  |               |          |   |                     |   |         |                  |  |   |          |  
|--------------------------------------------------------------------- |  | ------------- | -------- | - | ------------------- | - | ------- | ---------------- |  | - | -------- | -
|                                                                      |  | Pre-taxAmount |          |   | TaxExpense(Benefit) |   |         | Net-of-taxAmount | 
|For the Three Months Ended March 31, 2009:                            |  |               |          |   |                     |   |         |                  |  |   |          |  
|Unrealized gains on securities available-for-sale                     |  | $             | 396,621  |   |                     | $ | 136,834 |                  |  | $ | 259,787  |  
|Reclassification adjustment for gains (losses) realized in net income |  |               | (250,000 | ) |                     |   | (86,250 | )                |  |   | (163,750 | )
|                                                                      |  |               |          |   |                     |   |         |                  |  |   |          |  
|                                                                      |  |               |         
|Other comprehensive incomenet unrealized gains on securities         |  | $             | 146,621  |   |                     | $ | 50,584  |                  |  | $ | 96,037   |  
|                                                                      |  |               |          |   |                     |   |         |                  |  |   |          |  
|                                                                      |  |               |         
|For the Three Months Ended March 31, 2008:                            |  |               |          |   |                     |   |         |                  |  |   |          |  
|Unrealized losses on securities available-for-sale                    |  | $             | 188,661  |   |                     | $ | 67,224  |                  |  | $ | 121,437  |  
|Reclassification adjustment for gains (losses) realized in net income |  |               |         |   |                     |   |        |                  |  |   |         |  
|                                                                      |  |               |          |   |                     |   |         |                  |  |   |          |  
|                                                                      |  |               |         
|Other comprehensive incomenet unrealized losses on securities        |  | $             | 188,661  |   |                     | $ | 67,224  |                  |  | $ | 121,437  |  
|                                                                      |  |               |          |   |                     |   |         |                  |  |   |          |  

Accumulated other comprehensive income consists of the net unrealized gains and (losses) on securities available
for sale, net of the deferred tax effects.

NOTE 3  ASSETS AND LIABILITIES MEASURED AT FAIR VALUE

On January 1, 2008, the Company adopted Statement of Financial Accounting Standards No. 157, Fair Value Measurements(SFAS No. 157).
SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. SFAS No. 157 applies to reported balances that are required or permitted to be measured at fair value
under existing accounting pronouncements; accordingly, the standard does not require any new fair value measurements of reported balances.

SFAS
No. 157 emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or
liability. As a basis for considering market participant assumptions in fair value measurements, SFAS No. 157 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from
sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entitys own assumptions about market participant assumptions (unobservable inputs classified within
Level 3 of the hierarchy).



7



---

##### Table of Contents

COMMUNITYCORP

Notes to Condensed Consolidated Financial Statements



NOTE 3  ASSETS AND LIABILITIES MEASURED AT FAIR VALUE(Continued)



|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Level 1 |  | Valuation is based upon quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|        | 
|Level 2 |  | Valuation is based upon quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such
as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|        | 
|Level 3 |  | Valuation is generated from model-based techniques that use at least one significant assumption based on unobservable inputs for the asset or liability, which are typically based on an
entitys own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value
hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Companys assessment of the significance of a particular input to the fair
value measurement in its entirety requires judgment, and considers factors specific to the asset or liability.

The following is a description of valuation methodologies used for assets and liabilities recorded at fair value.

Securities Available for SaleInvestment securities available-for-sale are recorded at fair value on a recurring basis. Fair value
measurement is based upon quoted prices, if available. If quoted prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted
for the securitys credit rating, prepayment assumptions and other factors such as credit loss assumptions. Level 1 securities include those traded on an active exchange, such as the New York Stock Exchange, U.S. Treasury securities that are
traded by dealers or brokers in active over-the-counter markets and money market funds. Level 2 securities include mortgage-backed securities issued by government sponsored entities, municipal bonds and corporate debt securities. Securities
classified as Level 3 include asset-backed securities in less liquid markets.

LoansThe Company does not record loans at fair value on
a recurring basis. However, from time to time, a loan is considered impaired and an allowance for loan losses is established. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual
terms of the loan agreement are considered impaired. Once a loan is identified as individually impaired, management measures impairment in accordance with SFAS 114, Accounting by Creditors for Impairment of a Loan, (SFAS 114). The fair value
of impaired loans is estimated using one of several methods, including collateral value, market value of similar debt, enterprise value, liquidation value and discounted cash flows. Those impaired loans not requiring an allowance represent loans for
which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. At March 31, 2009, substantially all of the total impaired loans were evaluated based on the fair value of the collateral. In
accordance with SFAS 157, impaired loans where an allowance is established based on the fair value of collateral require classification in the fair value hierarchy. When the fair value of the collateral is based on an observable market price or a
current appraised value, The Company records the impaired loan as nonrecurring Level 2. When an appraised value is not available or management determines the fair value of the collateral is further impaired below the appraised value and there is no
observable market price, The Company records the impaired loan as nonrecurring Level 3.

Other Real Estate OwnedOther real estate owned
(OREO) is adjusted to fair value upon transfer of the loans to OREO. Subsequently, OREO is carried at the lower of carrying value or fair value. Fair value is based upon independent market prices, appraised values of the collateral or
managements estimation of the value of the collateral. When the fair value of the collateral is based on an observable market price or a current appraised value, the Company records the foreclosed asset as nonrecurring Level 2. When an
appraised value is not available or management determines the fair value of the collateral is further impaired below the appraised value and there is no observable market price, the Company records the OREO as nonrecurring Level 3.



8



---

##### Table of Contents

COMMUNITYCORP

Notes to Condensed Consolidated Financial Statements



NOTE 3  ASSETS AND LIABILITIES MEASURED AT FAIR VALUE(Continued)



Assets Measured at Fair Value on a Recurring Basis

The table below presents the Companys assets measured at fair value on a recurring basis as of March 31, 2009, and December 31, 2008, aggregated by the
level in the fair value hierarchy within which those measurements fall.



|                              |  |       |            |         |   |         |  |         |            |  |   |  
|----------------------------- |  | ----- | ---------- | ------- | - | ------- |  | ------- | ---------- |  | - | -
|                              |  | Total |            | Level 1 |   | Level 2 |  | Level 3
|March 31, 2009                |  |       |            |         |   |         |  |         |            |  |   |  
|Available for sale securities |  | $     | 23,855,159 |         | $ |        |  | $       | 23,855,159 |  | $ | 
|                              |  |       |            |         |   |         |  |         |            |  |   |  
|                              |  |       |            |        
|December 31, 2008             |  |       |            |         |   |         |  |         |            |  |   |  
|                              |  |       |            |        
|Available for sale securities |  | $     | 27,815,275 |         | $ |        |  | $       | 27,815,275 |  | $ | 
|                              |  |       |            |         |   |         |  |         |            |  |   |  

There were no liabilities carried at fair value at March 31, 2009 or December 31, 2008.

Assets Measured at Fair Value on a Nonrecurring Basis

The Company
may be required, from time to time, to measure certain assets at fair value on a nonrecurring basis in accordance with U.S. generally accepted accounting principles. These include assets that are measured at the lower of cost or market that were
recognized at fair value below cost at the end of the period. as of March 31, 2009, and December 31, 2008, aggregated by the level in the fair value hierarchy within which those measurements fall.



|                           |  |       |           |         |   |         |  |         |   |  |   |          
|-------------------------- |  | ----- | --------- | ------- | - | ------- |  | ------- | - |  | - | ---------
|                           |  | Total |           | Level 1 |   | Level 2 |  | Level 3
|March 31, 2009             |  |       |           |         |   |         |  |         |   |  |   |          
|Loans                      |  | $     | 1,303,645 |         | $ |        |  | $       |  |  | $ | 1,303,645
|Other real estate owned    |  |       | 75,000    |         |   |         |  |         |   |  |   | 75,000   
|                           |  |       |           |         |   |         |  |         |   |  |   |          
|                           |  |       |           |        
|Total assets at fair value |  | $     | 1,378,645 |         | $ |        |  | $       |  |  | $ | 1,378,645
|                           |  |       |           |         |   |         |  |         |   |  |   |          
|                           |  |       |           |        
|December 31, 2008          |  |       |           |         |   |         |  |         |   |  |   |          
|Loans                      |  | $     | 696,243   |         | $ |        |  | $       |  |  | $ | 696,243  
|Other real estate owned    |  |       | 75,000    |         |   |         |  |         |   |  |   | 75,000   
|                           |  |       |           |         |   |         |  |         |   |  |   |          
|                           |  |       |           |        
|Total assets at fair value |  | $     | 771,243   |         | $ |        |  | $       |  |  | $ | 771,243  
|                           |  |       |           |         |   |         |  |         |   |  |   |          

There were no liabilities carried at fair value at March 31, 2009 or December 31, 2008.



9



---

##### Table of Contents

COMMUNITYCORP



|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations
|------- | -------------------------------------------------------------------------------------

The following is a discussion of the Companys financial condition as of March 31, 2009 compared to December 31, 2008, and the results of operations for the three months ended March 31, 2009
compared to the three months ended March 31, 2008. These comments should be read in conjunction with the Companys condensed financial statements and accompanying footnotes appearing in this report. This report contains
forward-looking statements relating to, without limitation, future economic performance, plans and objectives of management for future operations, and projections of revenues and other financial items that are based on the beliefs of the
Companys management, as well as assumptions made by and information currently available to the Companys management. The words expect, estimate, anticipate, and believe, as well as similar
expressions, are intended to identify forward-looking statements. The Companys actual results may differ materially from the results discussed in the forward-looking statements, and the Companys operating performance each quarter is
subject to various risks and uncertainties that are discussed in detail in the Companys filings with the Securities and Exchange Commission.

Results of Operations

Net Interest Income

The largest component of total income is net interest income, the difference between the income earned on assets and the interest accrued or paid on deposits and borrowings used to support such assets. The volume and mix of assets and
liabilities and their sensitivity to interest rate movement determine changes in net interest income. Net interest margin is determined by dividing annualized net interest income by average earning assets. Net interest spread is derived from
determining the weighted-average rate of interest paid on deposits and borrowings and subtracting them from the weighted-average yield on earning assets.

Net interest income for the quarter ended March 31, 2009, was $1,352,687, compared to $1,402,460 for the same period last year, a decrease of $49,773, or 3.55%. The decrease was mainly attributable to the decrease in the average volume
of our earnings assets, which decreased 3.42%, while our interest-bearing liabilities increased 0.58%.

For the quarter ended March 31, 2009,
average-earning assets totaled $148,775,931 with an annualized average yield of 6.20%. Average earning assets and annualized average yield were $154,045,312 and 6.79%, respectively, for the quarter ended March 31, 2008. For the quarter ended
March 31, 2009, average interest-bearing liabilities totaled $128,251,115 with an annualized average cost of 2.92%. Average interest-bearing liabilities and annualized average cost were $127,514,453 and 3.78%, respectively, for the quarter
ended March 31, 2008.

Our annualized yield on average earning assets and our annualized average cost of our interest-bearing liabilities decreased 59
and 86 basis points respectively during the first quarter of 2009 compared to the first quarter of 2008.

Our net interest margin and net interest spread
were 3.69% and 3.28% for the quarter ended March 31, 2009 compared to 3.66% and 3.01%, respectively for the quarter ended March 31, 2008. The increases were primarily attributable to the increase in the average volume of our loans, which
generally are our highest yielding assets. For the quarter ended March 31, 2008 and 2007, the average volume of our loans was 77.37% and 73.99% of our total average earnings assets, respectively.

Details of the components of earning assets and interest-bearing liabilities are discussed in the following paragraphs.



10



---

##### Table of Contents

COMMUNITYCORP



|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations(continued)
|------- | -------------------------------------------------------------------------------------------------



Net Interest Income(continued)



Because loans often provide a higher yield than other types of earning assets, one of our goals is to maintain our loan portfolio as the
largest component of total earning assets. Loans comprised approximately 77.37% and 73.99% of average earning assets for the quarter ended March 31, 2009 and 2008, respectively. Loan interest income was $1,986,170 and $2,147,120 for quarter
ended March 31, 2009 and 2008, respectively. The annualized average yield on loans was 7.00% and 7.58% for the quarter ended March 31, 2009 and 2008, respectively. Average balances of loans increased to $115,112,686 during the quarter
ended March 31, 2009, an increase of $1,142,013 over the average of $113,970,673 during the quarter ended March 31, 2008. The decrease in our annualized average yield on loans is attributable to the decline in the prime interest rate. At
March 31, 2008, the prime rate was 5.25% and gradually declined to 3.25% as of March 31, 2009.

Investment securities averaged $27,853,945 or
18.72% of average earning assets, for first quarter of 2009 compared to $32,808,276 or 21.30% of average earning assets, for the same period in 2008. Interest earned on investment securities amounted to $272,672 for the quarter ended March 31,
2009, compared to $400,623 for the comparable period last year. Investment securities yielded 3.97% and 4.95% for the quarter ended March 31, 2009 and 2008, respectively.

Total interest expense for the quarter ended March 31, 2009 and 2008 was $922,535 and $1,198,907 respectively. The largest component of interest expense is interest on deposit accounts. Interest expense on
deposit accounts was $922,528 and $1,194,133, for the quarter ended March 31, 2009 and 2008, respectively. The average balance of interest bearing deposits increased to $128,247,215 during the quarter ended March 31, 2009 from $127,021,804
for the quarter ended March 31, 2008. The annualized average cost of deposits was 2.92% for the quarter ended March 31, 2009 compared to 3.81% for the same period in 2008.

For the quarter ended March 31, 2009 and 2008, the total annualized average cost of funds was 2.92% and 3.78%, respectively.

Provision and Allowance for Loan Losses

We provide for loan losses using the allowance method. Increases to the allowance result from
recording a provision for loan losses. Loan losses and recoveries are charged to the allowance. Charge-offs to the allowance are made when all or a portion of the loan is confirmed as a loss based on our review of the loan, through possession of the
underlying security, or through a troubled debt restructuring transaction. Likewise, recoveries offset these increases through credits to the allowance.

The allowance is maintained at a level that we believe is sufficient to cover losses in the loan portfolio at a specific point in time. Assessing the adequacy of the allowance requires considerable judgment. The adequacy of the allowance is
analyzed on a monthly basis using an internal analysis model. For purposes of this analysis, adequacy is defined as a level sufficient to absorb probable losses in the portfolio. This methodology relies upon our judgment. Our judgments are based on
our assessment of various issues, including, but not limited to, the pace of loan growth, emerging portfolio concentrations, the risk management system relating to lending activities, entry into new markets, new product offerings, loan portfolio
quality trends, and uncertainty in current economic and business conditions. An allowance model is used that takes into account factors including the composition of the loan portfolio such as risk grade classifications, historical asset quality
trends including, but not limited to, previous loss experience ratios, our assessment of current economic conditions, and reviews of specific high risk sectors of the portfolio. Loans are graded at inception and are reviewed on a periodic basis to
ensure that assigned risk grades are proper based on the definition of such classification. The value of underlying collateral is also considered during such analysis. The resulting monthly model and the related conclusions are reviewed and approved
by Senior Management. Our analysis of allowance adequacy includes consideration for loan impairment. While we use the best information available to make evaluations, future adjustments to the allowance may be necessary if results differ
substantially from the assumptions used in making the evaluations.



11



---

##### Table of Contents

COMMUNITYCORP



|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations(continued)
|------- | -------------------------------------------------------------------------------------------------



Provision and Allowance for Loan Losses(continued)



The methodology for assessing the adequacy of the allowance establishes both an allocated and
unallocated component of the allowance. The allocated component is based principally on current loan grades and historical loss rates. The unallocated component is the result of the portion of the assessment that estimates probable losses in the
portfolio that are not fully captured in the allocated allowance. This analysis includes, but is not necessarily limited to, industry concentrations, model imprecision, and the estimated impact of current economic conditions on historical loss
rates. On a continual basis, we monitor trends within the portfolio, both quantitative and qualitative, and assess the reasonableness of the unallocated component.

The allowance is subject to examination and adequacy testing by regulatory agencies. In addition, such regulatory agencies could require allowance adjustments based on information available to them at the time of their examination

The allowance for loan losses was 1.76% of total loans at March 31, 2009 and 2008. We believe the allowance for loan losses at March 31, 2009 is
reflective of the results of our allowance model methodology and accordingly, we believe the allowance as of March 31, 2009 is adequate, based on our assessment of probable losses, and available facts and circumstances then prevailing.

The provision for loan losses is the charge to operating earnings that management feels is necessary to maintain the allowance for possible loan losses at
an adequate level. For both the three months ended March 31, 2009 and 2008, the provision charged to expense was and $90,000 and $75,000, respectively.

Noninterest Income

Noninterest income increased $3,043 or 1.80%, to $171,959 for the three months ended March 31, 2009 from the
comparable period in 2008. Service charges on deposit accounts increased 3.58% to $129,002 for the three months ended March 31, 2009, while other income decreased $1,415 from March 31, 2008 to $42,957 for the same period in 2009.

Noninterest Expense

Total noninterest expense for the
three months ended March 31, 2009 and 2008 was $1,392,527 and $923,946, respectively. This represented an increase in noninterest expense of $468,581, or 50.72%. This increase is mainly attributable to the write down of investments totaling
$461,935 that we had in a financial institution that was seized by the Federal Deposit Insurance Corporation during April of 2009. Salaries and employee benefits increased $14,410, or 2.90%, from $496,081 for the three months ended March 31,
2008 to $510,591 for the comparable period in 2009. This increase is mainly attributable to the increase in cost of providing employee benefits. For the three months ended March 31, 2009, other operating expense was $725,702, or 434,178, higher
than the three months ended March 31, 2008. This increase includes the write down of the investments mentioned above. Net occupancy and equipment expense increased from $136,341 for the quarter ended March 31, 2008 to $156,334 for the
comparable period in 2009.

Income Taxes

The income
tax provision for the three months ended March 31, 2009 was $61,000 compared to $177,300 for the same period in 2008. The decrease in the provision resulted primarily from the decrease in net income before taxes. The tax provision was also
impacted by the relationship of the amount of non deductible items for income tax purposes that were included in net income before taxes.

Net Income

The combination of the above factors resulted in net loss for the three months ended March 31, 2009 of $18,881 as compared to a net income of
$395,130 for the same period in 2008. This represents a decrease of $414,011, or 104.78%, less than the same period in 2008.



12



---

##### Table of Contents

COMMUNITYCORP



|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations(continued)
|------- | -------------------------------------------------------------------------------------------------



Assets and Liabilities

During the first three months of 2009, total assets decreased $447,307 or 0.27%, when compared to December 31, 2008. Federal funds sold decreased $9,746,000 from December 31, 2008 to $3,400,000 at March 31, 2009. At
March 31, 2009, we were in the process of changing financial institutions, to which we sell our federal funds. Total investment securities decreased $4,266,100 from December 31, 2008 to $25,377,206 at March 31, 2009. Gross loans
increased $2,830,201, or 2.49%, to $116,534,271 at March 31, 2009.

For the three months ended March 31, 2009, total liabilities decreased
$142,253 or 0.10% and deposits decreased $22,965 or 0.02% from December 31, 2008.

For more analysis of the components of the changes in asset and
liabilities, see the following discussion of major balance sheet categories and the Consolidated Statements of Cash Flows included in Item 1. Financial Statements.

We closely monitor and seek to maintain appropriate levels of interest earning-assets and interest-bearing liabilities so that maturities of assets are such that adequate funds are provided to meet customer
withdrawals and loan demand.

Loans

At March 31,
2009, our total loans were $116,534,721 compared to $113,704,520 at December 31, 2008, an increase of $2,830,201 or 2.49%. At March 31, 2009 and 2008, approximately 98% of our loan portfolio consisted of fixed rate loans. Balances within
the major loans receivable categories as of March 31, 2009 and December 31, 2008 are as follows:



|                           |  |               |             |                  |   |            
|-------------------------- |  | ------------- | ----------- | ---------------- | - | -----------
|                           |  | March 31,2009 |             | December 31,2008
|Real estate  construction |  | $             | 4,253,586   |                  | $ | 4,564,879  
|Real estate  mortgage     |  |               | 38,091,783  |                  |   | 31,204,675 
|Commercial and industrial  |  |               | 65,268,123  |                  |   | 68,540,891 
|Consumer and other         |  |               | 8,921,229   |                  |   | 9,394,075  
|                           |  |               |             |                  |   |            
|                           |  |              
|Total gross loans          |  | $             | 116,534,721 |                  | $ | 113,704,520
|                           |  |               |             |                  |   |            

Risk Elements in the Loan Portfolio

The following table sets forth the Companys nonperforming assets at the dates indicated:



|                                                           |  |           |           |   |      |   |           |  
|---------------------------------------------------------- |  | --------- | --------- | - | ---- | - | --------- | -
|                                                           |  | March 31, |          
|                                                           |  | 2009      |           |   | 2008 |  
|Nonaccrual loans                                           |  | $         | 2,562,012 |   |      | $ | 1,123,244 |  
|Total loans impaired not in nonaccrual                     |  |           | 2,662,156 |   |      |   |          |  
|Loans 90 days or more past due and still accruing interest |  |           | 2,958     |   |      |   | 3,780     |  
|                                                           |  |           |           |   |      |   |           |  
|Total impaired and nonperforming loans                     |  |           | 5,227,126 |   |      |   | 1,127,024 |  
|Other real estate owned                                    |  |           | 75,000    |   |      |   |          |  
|                                                           |  |           |           |   |      |   |           |  
|Total impaired and nonperforming assets                    |  | $         | 5,302,126 |   |      | $ | 1,127,024 |  
|                                                           |  |           |           |   |      |   |           |  
|                                                           |  |          
|Nonperforming assets to year end loans                     |  |           | 4.55      | % |      |   | 1.00      | %

At March 31, 2009 and 2008, total impaired and nonperforming assets totaled $5,302,126 and $1,123,244,
respectively. Nonaccrual loans of $2,562,012 and $1,123,244 were included in impaired loans at March 31, 2009 and 2008, respectively. The impaired loans had specific valuation allowances of $322,620 and $168,487 at March 31, 2009 and 2008,
respectively. The average balances of impaired loans during the quarter ended March 31, 2009 and 2008 were $5,007,082 and $968,776, respectively.



13



---

##### Table of Contents

COMMUNITYCORP



|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations(continued)
|------- | -------------------------------------------------------------------------------------------------



During the fourth quarter 2008, we employed a more robust process for reviewing and categorizing loans, which caused
part of the increase of the levels in impaired loans.

At March 31, 2009 real estate or other collateral secured practically all of the loans that
were considered impaired. In the event of foreclosure on these loans, there can be no assurance that in liquidation, the collateral can be sold for its estimated fair market value or even for an amount at least equal to or greater than the loan
amount.

The results our internal review process and applying the allowance model methodology are the primary determining factors in managements
assessment of the adequacy of the allowance for loan losses.

Activity in the Allowance for Loan Losses is as follows:



|                                               |  |                             |             |   |      |   |             |  
|---------------------------------------------- |  | --------------------------- | ----------- | - | ---- | - | ----------- | -
|                                               |  | Three Months EndedMarch 31, |            
|                                               |  | 2009                        |             |   | 2008 |  
|Balance, January 1,                            |  | $                           | 1,981,637   |   |      | $ | 1,929,319   |  
|Provision for loan losses for the period       |  |                             | 90,000      |   |      |   | 75,000      |  
|Net loans charged-off for the period           |  |                             | (18,378     | ) |      |   | (17,988     | )
|                                               |  |                             |             |   |      |   |             |  
|                                               |  |                            
|Balance, end of period                         |  | $                           | 2,053,259   |   |      | $ | 1,986,331   |  
|                                               |  |                             |             |   |      |   |             |  
|                                               |  |                            
|Gross loans outstanding, end of period         |  | $                           | 116,534,721 |   |      | $ | 112,590,470 |  
|                                               |  |                            
|Allowance for loan losses to loans outstanding |  |                             | 1.76        | % |      |   | 1.76        | %

Deposits

Total deposits decreased by 0.02%, or $22,965, from December 31, 2008 to $145,691,020 at March 31, 2009. Noninterest-bearing deposits decreased $842,265 or 5.38% to $14,810,128 at March 31, 2009, while interest-bearing
deposits increased $819,300 or 0.63% to $130,880,892 at March 31, 2009.

Balances within the major deposit categories as of March 31, 2009 and
December 31, 2008 are as follows:



|                                    |  |               |             |                  |   |            
|----------------------------------- |  | ------------- | ----------- | ---------------- | - | -----------
|                                    |  | March 31,2009 |             | December 31,2008
|Noninterest-bearing demand deposits |  | $             | 14,810,128  |                  | $ | 15,652,393 
|Interest-bearing demand deposits    |  |               | 26,219,683  |                  |   | 21,065,476 
|Savings deposits                    |  |               | 13,619,442  |                  |   | 16,442,403 
|Certificates of deposit             |  |               | 91,041,767  |                  |   | 92,553,713 
|                                    |  |               |             |                  |   |            
|                                    |  |              
|                                    |  | $             | 145,691,020 |                  | $ | 145,713,985
|                                    |  |               |             |                  |   |            

We did not have any brokers deposits at March 31, 2009 or December 31, 2008

Liquidity

Liquidity needs are met by us through scheduled maturities
of loans and investments on the asset side and through pricing policies on the liability side for demand deposit accounts and short-term borrowings. The level of liquidity is measured by the loan-to-total funds ratio (total deposits plus short-term
borrowings), which was 79.99% at March 31, 2009 and 78.03% at December 31, 2008.

Asset liquidity is provided from several sources, including
amounts due from banks and federal funds sold. Available for sale securities, particularly those maturing within one year, provide a secondary source of liquidity. In addition, funds from maturing loans are a source of liquidity.



14



---

##### Table of Contents

COMMUNITYCORP



|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations(continued)
|------- | -------------------------------------------------------------------------------------------------



At March 31, 2009 the Bank had available an unused short-term line of credit to purchase up to $4,300,000 of
federal funds from unrelated correspondent institutions. The Bank also has a credit availability agreement with the Federal Home Loan Bank totaling 15 percent of the Banks assets as of any quarter end. As of March 31, 2009, the available
credit totaled approximately $24,677,000 and there were no borrowings outstanding. Any borrowings from the Federal Home Loan Bank will be secured by a blanket lien on all of the Banks 1-4 family residential first lien mortgage loans and or
investment securities.

Interest Rate Sensitivity

Interest rate sensitivity is defined as the exposure to variability in net interest income resulting from changes in market-based interest rates. Asset/liability management is the process by which we monitor and control the mix, maturities,
and interest sensitivity of our assets and liabilities. Asset/liability management seeks to ensure adequate liquidity and to maintain an appropriate balance between interest-sensitive assets and liabilities to minimize potentially adverse impacts on
earnings from changes in market interest rates. Interest rate sensitivity can be managed by repricing assets or liabilities, selling securities available-for-sale, replacing an asset or liability at maturity, or adjusting the interest rate during
the life of an asset or liability. We believe that interest rate risk management becomes increasingly important in an interest rate environment and economy such as the one that we are currently experiencing.

We monitor interest rate sensitivity by measuring our interest sensitivity through a gap analysis, which is the positive or negative dollar difference
between assets and liabilities that are subject to interest rate repricing within a given time period. Currently we are liability-sensitive over periods with maturity dates of less than twelve months. However, since interest rates and yields on
various interest sensitive assets and liabilities do not all adjust in the same degree when there is a change in prevailing interest rates (such as prime rate), the traditional gap analysis is only a general indicator of rate sensitivity and net
interest income volatility. As stated in Results of Operations for the Three Months Ended March 31, 2009 Compared to the Three Months Ended March 31, 2008  Net Interest Income, our net interest margin increased during the
current period. If net interest margin were to decline, net income will likely decline also.

Capital Resources

Total shareholders equity decreased $305,053 from $17,693,418 at December 31, 2008 to $17,388,365 at March 31, 2009. The net decrease is attributable to
the net loss for the period of $18,881, by the payment of $252,689 in cash dividends, and the purchase of treasury stock for $129,520. These decreases were reduced by the net increase for the period of $96,037 in the fair value of securities
available-for-sale.

Bank holding companies, such as ours, and their banking subsidiaries are required by banking regulators to meet certain minimum levels
of capital adequacy, which are expressed in the form of certain ratios. Capital is separated into Tier 1 capital (essentially common shareholders equity less intangible assets) and Tier 2 capital (essentially the allowance for loan losses
limited to 1.25% of risk-weighted assets). The first two ratios, which are based on the degree of credit risk in our assets, provide the weighting of assets based on assigned risk factors and include off-balance sheet items such as loan commitments
and stand-by letters of credit. The ratio of Tier 1 capital to risk-weighted assets must be at least 4.0% and the ratio of total capital (Tier 1 capital plus Tier 2 capital) to risk-weighted assets must be at least 8.0%. The capital leverage ratio
supplements the risk-based capital guidelines. Banks and bank holding companies are required to maintain a minimum ratio of Tier 1 capital to adjusted quarterly average total assets of 3.0%.



15



---

##### Table of Contents

COMMUNITYCORP



|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations(continued)
|------- | -------------------------------------------------------------------------------------------------



Capital Resourcescontinued



The following table summarizes the Banks risk-based capital at March 31, 2009:



|                                         |  |   |             |  
|---------------------------------------- |  | - | ----------- | -
|Shareholders equity                     |  | $ | 17,099,076  |  
|Less: intangibles                        |  |   |            |  
|                                         |  |   |             |  
|Tier 1 capital                           |  |   | 17,099,076  |  
|                                         | 
|Plus: allowance for loan losses (1)      |  |   | 1,572,738   |  
|                                         |  |   |             |  
|                                         | 
|Total capital                            |  | $ | 18,671,814  |  
|                                         |  |   |             |  
|                                         | 
|Risk-weighted assets                     |  | $ | 125,819,000 |  
|                                         |  |   |             |  
|                                         | 
|Risk-based capital ratios                |  |   |             |  
|Tier 1 capital (to risk-weighted assets) |  |   | 13.59       | %
|Total capital (to risk-weighted assets)  |  |   | 14.84       | %
|Tier 1 capital (to total average assets) |  |   | 10.57       | %



|(1) | limited to 1.25% of risk-weighted assets
|--- | ----------------------------------------

The Federal Reserve Board has
similar requirements for bank holding companies. The Company is currently not subject to these requirements because the Federal Reserve guidelines contain an exemption for bank holding companies of less than $500,000,000 in consolidated assets.

Regulatory Matters

We are not aware of any current
recommendations by regulatory authorities which, if they were to be implemented, would have a material effect on liquidity, capital resources or operations.

Off-Balance Sheet Risk

Through the operations of our Bank, we have made contractual commitments to extend credit in the ordinary course of
our business activities. These commitments are legally binding agreements to lend money to our customers at predetermined interest rates for a specified period of time. At March 31, 2009, we had issued commitments to extend credit of $9,891,000
and standby letters of credit of $780,132 through various types of commercial lending arrangements. We evaluate each customers creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by us upon
extension of credit, is based on our credit evaluation of the borrower. Collateral varies but may include accounts receivable, inventory, property, plant and equipment, commercial and residential real estate.



16



---

##### Table of Contents

COMMUNITYCORP



|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations(continued)
|------- | -------------------------------------------------------------------------------------------------



Critical Accounting Policies

We have adopted various accounting policies, which govern the application of accounting principles generally accepted in the United States in the preparation of our financial statements. Our significant accounting
policies are described in the notes to the consolidated financial statements at December 31, 2008 as filed in our annual report on Form 10-K. Certain accounting policies involve significant judgments and assumptions by us, which have a material
impact on the carrying value of certain assets and liabilities. We consider these accounting policies to be critical accounting policies. The judgments and assumptions we use are based on historical experience and other factors, which we believe to
be reasonable under the circumstances. Because of the nature of the judgments and assumptions we make, actual results could differ from these judgments and estimates which could have a material impact on our carrying values of assets and liabilities
and our results of operations.

We believe the allowance for loan losses is a critical accounting policy that requires the most significant judgments and
estimates used in preparation of our consolidated financial statements. Refer to the portion of this discussion that addresses our allowance for loan losses for a description of our processes and methodology for determining our allowance for loan
losses.

Recently Issued Accounting Standards

Accounting standards which have been issued or proposed by the Financial Accounting Standards Board that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon
adoption.



|Item 3. | Quantitative and Qualitative Disclosure About Market Risk
|------- | ---------------------------------------------------------

Not
applicable since we are a smaller reporting company.



|Item 4. | Controls and Procedures.
|------- | ------------------------

Within 90 days prior to the date of this
report, we carried out an evaluation, under the supervision and with the participation of our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures.
Based on this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures are effective in timely alerting them to material information required to be included in our periodic SEC
reports. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future
conditions, regardless of how remote.

In addition, we reviewed our internal controls, and there have been no significant changes in our internal controls
or in other factors that could significantly affect those controls subsequent to the date of their last evaluation.



17



---

##### Table of Contents

COMMUNITYCORP

Part II  Other Information



|Item 1 | Legal Proceedings
|------ | -----------------

There are no material pending legal proceedings
to which we are a party or of which any of our properties are the subject.



|Item 1A | Risk Factors
|------- | ------------

There has been no change in the risk factors, which
were reported on Form 10-K for the year ended December 31, 2008.



|Item 2 | Unregistered Sales of Equity Securities and Use of Proceeds
|------ | -----------------------------------------------------------

Not
applicable



|Item 3 | Default Upon Senior Securities
|------ | ------------------------------

Not applicable



|Item 4 | Submission of Matters to a Vote of Security Holders
|------ | ---------------------------------------------------

Not applicable



|Item 5 | Other Information
|------ | -----------------

Not applicable



|Item 6 | Exhibits
|------ | --------



|     |  |                                                                 
|---- |  | ----------------------------------------------------------------
|31.1 |  | Rule 13a-14(a) Certification of the Principal Executive Officer.
|     | 
|31.2 |  | Rule 13a-14(a) Certification of the Principal Financial Officer.
|     | 
|32   |  | Section 1350 Certifications.                                    



18



---

##### Table of Contents

COMMUNITYCORP

SIGNATURES

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

COMMUNITYCORP



|                    |  |     |  |                                    
|------------------- |  | --- |  | -----------------------------------
|Date:  May 13, 2009 |  | By: |  | /s/ W. ROGER CROOK                 
|                    |  |     |  | W. Roger Crook                     
|                    |  |     |  | President & Chief Executive Officer
|                    |  |    
|Date:  May 13, 2009 |  | By: |  | /s/ GWEN P. BUNTON                 
|                    |  |     |  | Gwen P. Bunton                     
|                    |  |     |  | Chief Financial Officer            



19