SECURITIES AND EXCHANGE COMMISSION
                           Washington, D. C.  20549


                                   FORM 10-Q

                  Quarterly Report Under Section 13 or 15(d)
                    of the Securities Exchange Act of 1934


For Quarter Ended September 30, 2000        Commission File No. 0-5929


                          F & M NATIONAL CORPORATION
            (Exact name of registrant as specified in its charter)


Commonwealth of Virginia                        54-0857462
(State or other jurisdiction of                 (IRS Employer
incorporation or organization)                  Identification Number)

9 Court Square, Winchester, Virginia                  22601
(Address of principal executive offices)              (Zip Code)


      Registrant's telephone number, including area code:  540-665-4200


                                 NO CHANGES
           (Former name, former address and former fiscal year, if
            changed since last report)


Indicate by check mark whether the registrant (l) has filed all
reports to be filed by Section 13 or 15(d) of the Securities and
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


As of November 9, 2000, there were 24,666,382 shares of the
Registrant's common stock outstanding.

<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
Item 1.  Financial Statements

F&M NATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (000 OMITTED)
<CAPTION>
                                                     (Unaudited)
                                                     Sept. 30,       December 31,
                                                     2000            1999
<S>                                                  <C>             <C>
Assets:
   Cash and due from banks                             133,171         127,633
   Interest-bearing deposits in other banks                171             225
   Securities-held to maturity(market value
     September 30, 2000-$521,188;
     December 31, 1999-$437,538)                       529,162         449,854
   Securities-available for sale
     (market value)                                    606,356         433,947

   Federal funds sold and securities
     purchased under agreements to resell               62,948          68,712

   Loans held for sale                                  40,500          22,217
   Loans                                             1,993,955       1,868,713
     Unearned income                                    (3,189)         (3,615)
       Loans (net of unearned income)                2,031,266       1,887,315
     Allowance for loan losses                         (24,390)        (24,050)
       Net loans                                     2,006,876       1,863,265

   Bank premises and equipment, net                     87,032          74,501
   Other assets                                        102,500          80,030

     Total assets                                    3,528,216       3,098,167


Liabilities and Shareholders' Equity:

Liabilities:
   Deposits
     Non-interest bearing                              641,094         541,417
     Interest bearing                                2,338,970       2,076,438
       Total deposits                                2,980,064       2,617,855

   Federal funds purchased and securities
     sold under agreements to repurchase               150,351          95,008

   Other short-term borrowings                          16,066          24,120
   Long-term debt                                       21,966          25,443
   Other liabilities                                    32,586          28,059

       Total liabilities                             3,201,033       2,790,485

</TABLE>
<TABLE>
F&M NATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (000 OMITTED)
<CAPTION>

                                                     (Unaudited)
                                                     Sept. 30,      December 31,
                                                     2000           1999

<S>                                                  <C>            <C>
Shareholders' Equity
   Preferred stock, no par value:
     (Authorized 5,000,000 shares,
      no shares outstanding)                                 0               0

   Common stock par value $2.00 per
     share, authorized 30,900,000 shares:
     issued September 30, 2000-24,759,882
     shares; issued December 31,
     1999-24,896,500 shares                             49,520          49,793

   Capital surplus                                      91,009          93,679
   Retained earnings                                   192,890         175,588
   Accumulated other
    comprehensive (loss)                                (6,236)        (11,378)

       Total shareholders' equity                      327,183         307,682

Total liabilities and
   shareholders' equity                              3,528,216       3,098,167

</TABLE>


See Accompanying Notes to Consolidated Financial Statements

<PAGE>
<TABLE>
F & M NATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (000 OMITTED)
<CAPTION>
                                          (Unaudited)             (Unaudited)
                                          For the Nine            For the Three
                                          Months Ended            Months Ended
                                          Sept. 30    Sept. 30    Sept. 30    Sept. 30
                                          2000        1999        2000        1999

<S>                                       <C>         <C>         <C>         <C>
Interest Income:
 Interest and fees on loans               125,454     118,796      43,007      39,903

 Securities held to maturity:
  Taxable interest income                  20,967      17,492       7,390       6,171
  Interest income exempt from
   federal income taxes                     1,159       1,134         385         380
 Securities available for sale:
  Taxable interest income                  21,560      18,339       7,910       6,381
  Interest income exempt from
   federal income taxes                        40          41          13          14
  Dividend income                             880         734         331         267
   Total security interest income          44,606      37,740      16,029      13,213

 Interest on federal funds sold
  and securities purchased
  under agreements to resell                4,955       3,826       1,655         977
 Interest on deposits in banks                 14          44          13          19
   Total interest income                  175,029     160,406      60,704      54,112

Interest Expense:
 Interest on deposits                      65,950      58,574      23,552      19,317
 Interest on short-term borrowings          4,953       2,445       1,719         651
 Interest on long-term debt                 1,150       1,228         350         486
  Total interest expense                   72,053      62,247      25,621      20,454

  Net interest income                     102,976      98,159      35,083      33,658

Provision for loan losses                   2,890       2,814       1,101         793
 Net interest income after
  provision for loan losses               100,086      95,345      33,982      32,865

Other Income:
 Commissions and fees from
  fiduciary activities                      2,346       2,159         768         703
 Service charges on
  deposit accounts                         13,260      11,484       4,735       3,981
 Credit card fees                           3,750       3,448       1,321       1,247
 Fees for other customer services          10,151       6,143       3,851       2,518
 Insurance commissions                      7,521       6,969       2,710       2,441
 Other operating income                     4,232       3,608         708       1,263
 Profits on securities
  available for sale                          --        3,113          --          --

   Total other income                      41,260      36,924      14,093      12,153
</TABLE>
<TABLE>
F & M NATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (000 OMITTED)
<CAPTION>
                                          (Unaudited)             (Unaudited)
                                          For the Nine            For the Three
                                          Months Ended            Months Ended
                                          Sept. 30    Sept. 30,   Sept. 30,   Sept. 30,
                                          2000        1999        2000        1999

<S>                                       <C>         <C>         <C>         <C>
Other Expenses:
  Salaries and employees'
   benefits                                48,897      46,843      16,406      16,033
  Net occupancy expense
   of premises                              7,320       6,755       2,427       2,263
  Furniture and equipment expense           6,023       5,573       2,014       2,047
  Credit card expense                       2,731       2,701         970         991
  Other operating expense                  21,832      19,551       6,827       6,871
   Total other expense                     86,803      81,423      28,644      28,205
    Income before income taxes             54,543      50,846      19,431      16,813
    Income tax expense                     18,976      17,703       6,782       5,686

    Net income                             35,567      33,143      12,649      11,127

Average shares:
  Basic                                    24,873      25,051      24,830      24,977
  Assuming dilution                        25,013      25,180      24,963      25,070

Earnings per common share:
    Basic                                    $1.43       $1.32      $0.51       $0.45
    Assuming dilution                        $1.42       $1.32      $0.51       $0.44

    Dividends per share                      $0.735      $0.665     $0.25       $0.235

</TABLE>


See Accompanying Notes to Consolidated Financial Statements


<PAGE>
<TABLE>
F&M NATIONAL CORPORATION AND SUBSIDIARIES-CONSOLIDATED STATEMENTS OF CHANGES
IN SHAREHOLDERS' EQUITY FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(000 OMITTED)
<CAPTION>
                                                         Accumulated
                                                         Other
                                                         Compre-       Compre-
                          Common   Capital    Retained   hensive       hensive
                          Stock    Surplus    Earnings   Income        Income      Total
                                                         (Loss)

<S>                       <C>      <C>        <C>        <C>           <C>         <C>
Balances -
  January 1, 1999         48,845    81,910    174,777        6,416                 311,948

Comprehensive
  Income:
   Net income                                  33,143                    33,143     33,143
   Other comprehensive
    income-net of tax:
  Unrealized loss on
   available for sale
   securities                                                           (11,218)   (11,218)

  Less: Reclassifi-
   cation adjustment
   for gains realized
   in net income                                                         (2,023)    (2,023)

  Other comprehensive
   income (loss),
   net of tax                                              (13,241)     (13,241)
  Total compre-
   hensive income                                                        19,902

Cash dividends                                (15,591)                             (15,591)
Stock dividend             1,339    19,291    (20,630)                                   0
Acquisition of common
  stock                     (837)  (11,657)                                        (12,494)
Issuance of stock -
 benefit plans               452     4,456                                           4,908

Balances -
  September 30, 1999      49,799    94,000    171,699       (6,825)                308,673
</TABLE>

See Accompanying Notes to Consolidated Financial Statements
<TABLE>
F&M NATIONAL CORPORATION AND SUBSIDIARIES-CONSOLIDATED STATEMENTS OF CHANGES
IN SHAREHOLDERS' EQUITY FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(000 OMITTED)
<CAPTION>
                                                         Accumulated
                                                         Other
                                                         Compre-       Compre-
                          Common   Capital    Retained   hensive       hensive
                          Stock    Surplus    Earnings   (Loss)        Income      Total


<S>                       <C>      <C>        <C>        <C>           <C>        <C>
Balances -
  January 1, 2000         49,793   93,679     175,588     (11,378)                307,682

Comprehensive
  Income:
   Net income                                  35,567                   35,567     35,567

Other comprehensive
  income net of tax:
   Unrealized gain on
    available-for-
    sale securities                                                      5,142      5,142

  Less: Reclassifi-
   cation adjustment
   for gains realized
   in net income                                                            --         --

   Other compre-
    hensive income,
    net of tax                                              5,142        5,142
     Total compre-
      hensive income                                                    40,709

Cash dividends                                (18,265)                            (18,265)
Acquisition of
  common stock              (598)  (6,596)                                         (7,194)
Issuance of stock-
  benefit plans              325    3,926                                           4,251

Balances -
  September 30, 2000      49,520   91,009     192,890      (6,236)                327,183
</TABLE>

See Accompanying Notes to Consolidated Financial Statements
<TABLE>
F&M NATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (000 Omitted)
<CAPTION>
                                                              For the Nine Months Ended
                                                              Sept. 30,      Sept. 30,
                                                              2000           1999
                                                              (Unaudited)    (Unaudited)

<S>                                                           <C>            <C>
Cash Flows From Operating Activities
Net income                                                      35,567         33,143
  Adjustments to reconcile net income to net
   cash provided by operating activities:
    Depreciation and amortization                                5,864          6,048
    Provision for loan losses                                    2,890          2,814
    Profit on securities available for sale                        --           3,113
    (Increase) decrease in other assets                        (27,201)            94
    Increase in other liabilities                                4,527          2,319
    Net cash provided by operating activities                   21,647         47,531

Cash Flows From Investing Activities
  Decrease (increase) in interest-bearing
   deposits in other banks                                          54           (211)
  Proceeds from maturities and calls
   of available for sale securities                             28,272        123,846
  Purchase of securities available for sale                   (192,770)      (155,110)
  Proceeds from maturities of investment
   securities                                                   41,360         64,946
  Purchase of investment securities                           (120,668)      (105,242)
  Decrease in federal funds sold
   and securities purchased under agreements
   to resell                                                     5,764         88,810
  Net increase in loans                                       (147,576)       (53,272)
  Purchases of bank premises and equipment                     (17,460)        (9,032)
  Proceeds from sale of other real estate owned                  3,045          3,453
    Net cash used in investing activities                     (399,979)       (41,812)

Cash Flows From Financing Activities
  Net increase (decrease) in noninterest-bearing
   and interest-bearing demand deposits
   and savings accounts                                        (95,065)         4,177
  Net increase (decrease) in certificates
   of deposit                                                  457,274        (36,435)
  Dividends paid                                               (18,265)       (15,591)
  Increase in other short-term borrowings                       47,289          6,763
  Increase (decrease) in long-term debt                         (3,477)         4,603
  Acquisition of common stock                                   (7,194)       (12,494)
  Net proceeds from issuance of common stock                     3,308          3,905

</TABLE>

<PAGE>
<TABLE>
F&M NATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (000 Omitted)
<CAPTION>

                                                              For the Nine Months Ended
                                                              Sept. 30,      Sept. 30,
                                                              2000           1999
                                                              (Unaudited)    (Unaudited)

<S>                                                           <C>            <C>

Net cash provided by (used in)
  financing activities                                         383,870        (45,072)

   Increase (decrease) in cash and
    cash equivalents                                             5,538        (39,353)

Cash and Cash Equivalents
  Beginning                                                    127,633        169,181

  Ending                                                       133,171        129,828


Supplemental Disclosures of Cash Flows
Information
  Cash payments for:
   Interest paid to depositors                                  51,322         58,574
   Interest paid on other short-term
    borrowings                                                   4,953          2,445

                                                                56,275         61,019

   Income taxes                                                 18,045         14,706

Supplemental Schedule of Noncash Investing
and Financing Activities
  Issuance of stock options under
  nonvariable compensatory plan:
   2000 - 68,500 shares;
   1999 - 67,000 shares                                            943          1,003

  Loan balances transferred to foreclosed
   properties                                                    1,075          2,993

  Market value adjustment available for
   sale securities                                              (5,142)       (13,241)

</TABLE>



See Accompanying Notes to Consolidated Financial Statements


<PAGE>
F&M NATIONAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENT
SEPTEMBER 30, 2000 (UNAUDITED) AND DECEMBER 31, 1999


1.  In the opinion of management, the accompanying unaudited
consolidated financial statements contain all adjustments (consisting
of only normal recurring accruals) necessary to present fairly the
financial position as of September 30, 2000, and December 31, 1999, and
the results of operations and changes in cash flows for the nine months
ended September 30, 2000 and 1999.  The statements should be read in
conjunction with the Consolidated Notes to Financial Statements
included in F&M's Annual Report for the year ended December 31, 1999.

The amounts previously reported for the periods presented have been
retroactively restated to reflect the acquisition of The State Bank of
the Alleghenies on January 3, 2000. The transaction was accounted for
under the pooling of interests method.


2.  The results of operations for the nine-month periods ended
September 30, 2000 and 1999, are not necessarily indicative of the
results to be expected for the full year.


3.  F&M National Corporation's ("F&M" or the "Corporation") amortized
cost and market value of securities being held to maturity as of
September 30, 2000, are as follows:


<TABLE>
<CAPTION>

                                  September 30, 2000 (000 omitted)
                                               Gross        Gross
                                  Amortized    Unrealized   Unrealized   Market
                                  Cost         Gains        (Losses)     Value

<S>  <C>                          <C>          <C>          <C>

U.S. Treasury securities
 and obligations of U.S.
 government corporations
 and agencies                      505,321      1,277        (9,289)      497,309
Obligations of states and
 political subdivisions             22,782        150          (120)       22,812
Corporate securities                 1,059          9            (1)        1,067
                                   529,162      1,436        (9,410)      521,188

</TABLE>

<PAGE>
F&M's amortized cost and market value of the available for sale
securities as of September 30, 2000, are as follows:

<TABLE>
<CAPTION>
                                    September 30, 2000 (000 omitted)
                                                 Gross        Gross
                                    Amortized    Unrealized   Unrealized    Market
                                    Cost         Gains        (Losses)      Value
<S>  <C>                            <C>          <C>          <C>
U.S. Treasury securities
 and obligations of U.S.
 government corporations
 and agencies                       592,800       1,868       (11,044)      583,624
Obligations of states and
 political subdivisions              10,594          15          (179)       10,430
Other                                12,042         260             0        12,302

                                    615,436       2,143       (11,223)      606,356
</TABLE>

4.   F&M's loan portfolio is composed of the following:

<TABLE>
<CAPTION>
                                                  Sept. 30,        December 31,
                                                  2000             1999
                                                  (000 Omitted)

<S>                                               <C>              <C>
Loans - held for sale                                40,500           22,217
Commercial, financial and agricultural              302,582          300,015
Real estate-construction                            114,079          108,631
Real estate-mortgage                              1,291,164        1,192,015
Consumer loans to individuals                       286,130          268,052
  Total loans                                     2,034,455        1,890,930
Less:   Unearned income                              (3,189)          (3,615)
        Allowance for loan losses                   (24,390)         (24,050)
Loans, net                                        2,006,876        1,863,265
</TABLE>

F&M had $11,199,000 in loans in a non-accrual category at September 30,
2000.

5.  Reserve for Loan Losses:
<TABLE>
<CAPTION>
                                                  Sept. 30,        December 31,
                                                  2000             1999
                                                  (000 Omitted)
<C>                                               <S>              <S>
Balance at January 1                              24,050           23,509
Provision charged to operating expense             2,890            4,021
Recoveries added to the reserve                      497              850
Loan losses charged to the reserve                (3,047)          (4,330)
Balance at end of period                          24,390           24,050
</TABLE>

6.  Earnings and dividends paid per share:

<TABLE>
<CAPTION>
                              September 30, 2000           September 30, 1999
                              (in 000s)       Per Share    (in 000s)     Per Share
                              Shares          Amount       Shares        Amount
<C>                           <S>             <S>          <S>           <S>
Basic EPS                     24,873          1.43         25,051        1.32
Effective of
 dilutive securities:
  Stock options                  140                          129
Diluted EPS                   25,013          1.42         25,180        1.32
</TABLE>


7.   F&M, on August 11, 1999, declared a 3% stock dividend payable on
October 26, 1999, to shareholders of record on September 24, 1999. F&M
issued approximately 665,806 shares of common stock with cash being
paid in lieu of fractional shares.

8.   On January 3, 2000, the Corporation acquired The State Bank of the
Alleghenies, Covington, Virginia, for approximately 1,912,000 shares of
F&M common stock in a transaction accounted for as a pooling-of-
interests. Upon the effective date of the share exchange, The State
Bank of the Alleghenies changed its name to F&M Bank-Highlands.

9.   On August 25, 2000, the Corporation completed the acquisition of 15
banking offices and approximately $300 million in deposits from
Wachovia Bank, N.A. The new locations were acquired by five of F&M's
community banks. F&M Bank-Winchester acquired two locations in Luray,
Virginia.  F&M Bank-Massanutten acquired one location in Staunton.  F&M
Bank-Highlands acquired one location in Vinton.  F&M Bank-Central
Virginia acquired locations in Fork Union, Gordonsville, Mineral,
Palmyra, and Ruckersville, and two locations in Chatham.  F&M Bank-
Emporia expanded their market area with new locations in Blackstone,
Drakes Branch, Franklin, and Kenbridge.

10.   On July 13, 2000, the Corporation and Atlantic Financial Corp. of
Newport News, Virginia announced the signing of a definitive agreement
for the affiliation of Atlantic with F&M.  Under terms of the
agreement, F&M will exchange 0.753 shares of its common stock for each
share of Atlantic stock.  The transaction has an indicated value of
approximately $70.59 million, or $16.85 per Atlantic share.  The
transaction is calculated at 1.55 times book value for 2000.  The offer
is 14.0 times 2000 estimated earnings.  The transaction is intended to
qualify as a tax-free exchange and be accounted for as a pooling of
interests.  Atlantic's two bank subsidiaries, Peninsula Trust Bank and
United Community Bank, will be combined and will be operated as a
separate banking subsidiary of F&M under the name of F&M Bank-Atlantic.
The transaction is expected to be completed in the first quarter of
2001.

11.   On August 23, 2000, the Corporation and Community Bankshares of
Maryland, Bowie, Maryland ("Community") announced the signing of a
definitive agreement for the affiliation of Community with F&M.  Under
terms of the agreement, F&M will exchange 0.75 shares of its common
stock for each share of Community stock.  The transaction has an
indicated value of approximately $13.1 million, or $18.05 per Community
share, based on F&M's closing price on August 22, 2000, of $24.06.  The
transaction is calculated at 1.40 times the estimated book value for
2000.  The offer is 17.3 times 2000 estimated earnings.  The
transaction, expected to be completed in the first quarter of 2001, has
been approved by each companys Board of Directors and requires the
approval of various regulatory agencies and the shareholders of
Community and satisfaction of other standard conditions.  The
transaction is intended to qualify as a tax-free exchange and be
accounted for as a pooling of interests.  Community will merge with F&M
Bank-Allegiance to provide one bank financial services through its
Maryland markets upon completion of the transaction.



INDEPENDENT ACCOUNTANT'S REPORT



To the Board of Directors
F & M National Corporation
Winchester, Virginia


We have reviewed the accompanying consolidated balance sheet of F&M
National Corporation and Subsidiaries as of September 30, 2000, and the
related consolidated statements of income, changes in shareholders'
equity and cash flows for the nine-month periods ended September 30,
2000 and 1999.  These financial statements are the responsibility of
the Corporation's management.

We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants.  A review of
interim financial information consists principally of applying
analytical procedures to financial data and making inquiries of persons
responsible for financial and accounting matters.  It is substantially
less in scope than an audit conducted in accordance with generally
accepted auditing standards, the objective of which is the expression
of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications
that should be made to the accompanying condensed consolidated
financial statements referred to above for them to be in conformity
with generally accepted accounting principles.

We have previously audited, in accordance with generally accepted
auditing standards, the balance sheet of F&M National Corporation and
Subsidiaries as of December 31, 1999, and the related statements of
income, changes in shareholders' equity and cash flows for the year
then ended (not presented herein); and in our report dated January
28, 2000, we expressed an unqualified opinion on those financial
statements. In our opinion, the information set forth in the
accompanying condensed balance sheet as of December 31, 1999 is fairly
stated, in all material respects, in relation to the balance sheet from
which it has been derived.



/s/
YOUNT, HYDE & BARBOUR, P.C.
Winchester, Virginia
November 13, 2000


<PAGE>
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

Management's discussion and analysis of financial information is
presented to aid the reader in understanding and evaluating the
financial condition and results of operations of F&M National
Corporation ("F&M" or the "Corporation").

FINANCIAL CONDITION

F&M's improved earnings for the third quarter 2000 was primarily
attributable to increased earnings associated with the acquisition of
15 branches, implementation of projects to improve operational
efficiencies, and increases in noninterest income.  The following
discussion elaborates on balance sheet growth and earnings improvement.

On August 25, 2000, F&M acquired deposits of approximately $300 million
and 15 branch offices valued at approximately $8.0 million from
Wachovia Bank, N.A. F&M immediately invested approximately $242 million
of the acquired funds in U.S. Agency securities.  Goodwill associated
with the acquisition was approximately $23 million, which will be
amortized.  All former employees of the acquired branches were invited
to become employees of F&M after the acquisition.

F&M has implemented over the past year a program known as "Getting
Better Quicker" or GBQ.  This program spearheaded by F&M's software
vendor established policies and procedures aimed at improving service
to bank customers.  GBQ provided cross training of employees to better
serve customers and realign back office departments, thereby, reducing
overhead expenditures and improving earnings.

Noninterest income has increased $7.5 million or 22.0% for the first
nine months 2000 as compared to the first nine months 1999, if
nonrecurring security gains are eliminated.  Revenues increased
primarily as a result of insurance commissions from nonbank insurance
subsidiaries, increased debit card fees, point of sale charges and
foreign ATM transactions.

Total assets on September 30, 2000, were $3.528 billion, up $449.9
million or 14.6% from $3.078 billion at September 30, 1999. Total
assets at December 31, 1999, were $3.098 billion. For the first nine
months of 2000, total assets averaged $3.278 billion, 7.2% above the
first nine months 1999 average of $3.060 billion.

Total loans, net of unearned income, amounted to $2.031 billion at
September 30, 2000, an increase of $158.0 million or 8.4% from $1.873
billion at September 30, 1999. At December 31, 1999, total loans, net,
were $1.887 billion. Total loans (net) as a percent of total assets
were 57.6% at September 30, 2000, compared to 60.9% at September 30,
1999, and December 31, 1999. Net loan volume for the first nine months
of 2000 was $144.0 million as compared to $47.5 million for the first
nine months of 1999. Loan volume has been strong despite increases in
the prime lending rate primarily due to confidence in the economy.

On September 30, 2000, the securities portfolio totaled $1.136 billion,
which was $258.6 million or 29.5% higher than the year before, and
$251.7 million or 28.5% higher than at December 31, 1999. Investment in
securities increased approximately $16.7 million or 1.9% for the nine-
month periods if investment in securities attributable to the branch
acquisitions were eliminated.  Strong loan demand limited funds to be
invested in securities prior to the acquisition.  Funds invested in the
securities portfolio were invested primarily in U. S. Agency
securities, which had attractive yield and maturity offerings.  Federal
funds sold and securities purchased under agreement to resell were
$62.9 million at September 30, 2000, $5.8 million or 8.4% lower than
$68.7 million outstanding at December 31, 1999. Federal funds sold are
one-day sales of funds to large regional correspondent banks and are
the lowest earning pool of interest-earning funds. Federal funds have
decreased due to increased demand for short term loan funding.

The market value of available for sale ("AFS") securities at September
30, 2000, was $606.4 million as compared to $433.9 million at September
30, 1999. F&M increased the investment in AFS securities as a result of
attractive rates and the high quality of US agency securities. The
effect of the market value of AFS securities less the book value of AFS
securities, net of income taxes reflected in Shareholders' Equity was
$(6.2) million at September 30, 2000, a decrease from the September 30,
1999, which is an improvement of $589 thousand. Recent increases in
interest rates by the Federal Reserve have a converse relationship to
the market rates in the investment portfolio contributing to the
decline in market value of securities. The decline in value is a
"paper" loss, which is not realized unless the entire AFS portfolio
would be sold, which is not likely.  The decline in the market value of
available for sale securities below book value is a temporary market
condition and is not indicative of a deterioration of asset rating or
quality.

Total deposits increased $391.9 million or 15.1% to $2.980 billion at
September 30, 2000, compared to one year earlier. At December 31, 1999,
total deposits were $2.618 billion. If the acquired $300 million
deposits were eliminated for the nine month periods, deposit growth
would have grown approximately $92 million or 3.5%.  Noninterest-
bearing deposits increased $97.2 million or 17.9% from $543.9 million
at September 30, 1999, to $641.1 million at September 30, 2000.
Interest-bearing deposits increased $294.8 million or 14.4% from $2.044
billion at September 30, 1999, to $2.339 billion at September 30, 2000.
F&M customers are moving funds into interest bearing deposits to take
advantage of attractive interest rates.  F&M offers attractive, yet
competitive, rates that are set to maintain a fair net interest margin.

Long-term debt was $22.0 million at September 30, 2000, down $3.7
million or 14.4% from $25.7 million at Sept 30, 1999. Long-term debt
was $25.4 million at year-end 1999. Long-term debt consists of borrowed
funds from Federal Home Loan Banks that supports loans to eligible bank
customers for a period of 10 to 15 years for low-income housing.

RESULTS OF OPERATIONS

Net income for the first nine months of 2000 amounted to $35.6 million,
increasing $2.4 million or 7.3% from $33.1 million for the first nine
months of 1999. Net income for the first nine months 2000 was $35.6
million increasing $4.4 million or 14.0% from $31.2 million for the
first nine months 1999 if nonrecurring items of income and expense were
eliminated.

The yield on interest-earning assets was 7.84% for the first nine
months 2000 as compared to 7.67% for the first nine months 1999, and
the yield on interest-bearing deposits was 4.12% for the first nine
months 2000 as compared to 3.80% for the first nine months 1999.

Return on average assets was 1.45% for the first nine months of 2000
and first nine months 1999 and 1.40% for the year 1999. F&M's return on
average equity was 14.86% for the first nine months of 2000, 14.16% for
the first nine months of 1999, and 13.99% for the year ended 1999.

Net interest income totaled $103.0 million for the first nine months of
2000, a $4.8 million or 4.9% increase over F&M's performance for the
first nine months of 1999. The net interest margin on a Federal tax
equivalent basis for the first nine months of 2000 was 4.63%, down 8
basis points from 4.71% for the first nine months of 1999. The decrease
in net interest margin is primarily the effect of higher net cost on
interest-bearing liabilities facilitated by recent increases in the
prime-lending rate.

Total nonperforming assets, which consist of nonaccrual loans,
restructured loans, and foreclosed properties were $20.6 million at
September 30, 2000, a increase of $700 thousand or 3.5% from $19.9
million at December 31, 1999. Nonperforming assets are composed largely
of 1-4 family residential loans and commercial loans secured by real
property.

Nonperforming loans (nonaccrual loans and restructured loans) at
September 30, 2000, were $11.2 million or 0.6% of total loans, up $2.3
million from $8.9 million at December 31, 1999. Nonperforming loans are
those loans where, in the opinion of management, the full collection of
principal or interest is unlikely.

FASB 114 defines impaired loans as all loans excluding personal real
estate and consumer loans about which there is doubt as to the ability
of the customer to meet their contractual obligations.

                                              September 30, 2000

      Commercial nonaccrual loans             $  3,394
      Commercial accrual loans                  15,005
      Total impaired loans                    $ 18,399

At September 30, 2000, impaired loans totaled $18.4 million upon which
an allowance of $2.9 million has been provided, which is included in
the total loan portfolio allowance for loan losses. Interest income
recognized on impaired loans as of September 30, 2000, was $1.5
million. The average balance of impaired loans for the first nine
months 2000 was $18.7 million. Loans past due 90 days or more and still
accruing interest because they were well secured and in the process of
collection were $6.3 million at September 30, 2000, and $4.3 million at
December 31, 1999.

Foreclosed properties consist of 23 parcels of real estate acquired
through debt previously contracted. These properties consist primarily
of commercial and residential real estate whose value is determined
through sale at public auction or fair market value, whichever is less.
At September 30, 2000, foreclosed properties were $9.4 million as
compared to $11.0 million at December 31, 1999.

The allowance for loan losses was $24.4 million at September 30, 2000,
as compared to $24.1 million at year-end 1999. The allowance for loan
losses increased $340 thousand in the first nine months of 2000 as
compared to a $513 thousand increase for the first nine months of 1999.
The amount provided for loan losses in 2000 and 1999 is an amount, in
management's judgment, is sufficient for the risk associated with the
loan portfolio. The ratio of allowance for loan losses to total loans
was 1.20% at September 30, 2000, as compared to 1.28% for Sept 30, 1999
and 1.27% at year-end 1999.

Total noninterest income increased $4.3 million or 11.7% from $36.9
million for the first nine months of 1999 to $41.3 million for the
first nine months of 2000. If security gains were eliminated for the
nine-month periods, noninterest income increased $7.5 million or 22.0%.
For the first nine months 1999, gains realized on securities available
for sale were $3.1 million or 8.4% of total noninterest income,
whereas, for the first nine months of 2000 there were no securities
gains taken. Security gains are realized when market conditions exist
that are favorable to the Corporation and/or conditions dictate
additional liquidity is desirable. It is the intent of the Corporation
not to sell any security that is held in its "held to maturity"
portfolio and any gain or loss in this category is the result of
securities being called prior to maturity by the issuer.

Credit card fees were $3.8 million for the first nine months of 2000,
up $302 thousand or 8.8% over the first nine months of 1999 as a result
of marketing efforts to attract new credit card customers and
additional customer activity. Insurance commission income for the first
nine months of 2000 was $7.5 million, up $552 thousand from the first
nine months of 1999 primarily as a result of increased business
activity of F&M's insurance agencies, whose primary sources of revenue
are derived from selling insurance policies to customers. Service
charges on deposit accounts were $13.3 million for the first nine
months 2000, up $1.8 million or 15.5% over the nine-month period 1999.
Revenues have increased from fees charged for debit card transactions,
point of sale charges, and ATM transactions.  Revenues from fees for
other customer services increased $4.0 million or 65.2% from $6.1
million for the first nine months of 1999 to $10.2 million in 2000
primarily as a result of fees charged customers in the secondary
market. Other operating income increased $624 thousand or 17.3%, up
from $3.6 million for the first nine months of 1999 to $4.2 million for
the first nine months of 2000. The increase in other operating income
is a seasonal variation in other fees and charges.

Total noninterest expenses increased $5.4 million or 6.6% from $81.4
million for the first nine months of 1999 to $86.8 million for the
first nine months of 2000. Salary expense increased $2.1 million or
4.4% from $46.8 million for the first nine months of 1999 to $48.9
million for the first nine months of 2000 as a result of employing
additional personnel due to the branch expansion, certain employees who
are paid on a commission basis, and increases in costs associated with
salaries and benefits. The acquisition price associated with acquiring
15 branches was approximately $8.0 million, which will be amortized
over the appropriate depreciable life of each asset.  The cost of net
occupancy expense has increased $565 thousand or 8.4% to $7.3 million
for the first nine months of 2000, as a result of acquiring new
branches and remodeling older branches. Furniture and equipment expense
increased $450 thousand or 8.1% to $6.0 million for the first nine
months of 2000, which is reflective of higher 2000 costs related to
equipment and software upgrades.   Other operating expense increased
$2.3 million from $19.6 million for the first nine months of 1999 to
$21.8 million for the first nine months of 2000.  Goodwill expense for
the first nine months 2000 was $935 thousand, which is included in
other operating expense.

Income taxes increased $1.3 million or 7.2% from $17.7 million for the
first nine months of 1999 to $19.0 million for the first nine months of
2000. The increase in income taxes is the result of larger amounts of
income subject to income taxes.

ASSET QUALITY

Loan quality continues to be good based on reviews by management. Loan
quality is the result of management employing conservative principles
of lending while meeting the needs of customers. Good loan quality
results in reduced need for additional provision for loan losses and
efforts to collect past due loans, which has a positive impact on net
income.

Total loan charge offs less recoveries amounted to $2.6 million for the
first nine months of 2000, representing a ratio of net charge offs to
total average loans, net of unearned income, of 0.13%, annualized. This
compares to 1999 twelve-month net charge-offs of $3.5 million, or 0.19%
of average loans.

As of September 30, 2000, loans on non-accrual basis amounted to $11.2
million, or 0.55% of total loans, net of unearned discount, up from
$9.6 million for the same period 1999. Loans 90 days or more past due
and still accruing totaled $6.3 million, or 0.31% of total loans, net
of unearned discount. In management's judgment, the balance in the
reserve for loan losses is adequate to cover future losses in the
existing loan portfolio.

F&M closely monitors those loans that are deemed to be potential
problem loans. Loans are viewed as potential problem loans when
possible credit problems of the borrowers cause management to have
doubts as to the ability of such borrowers to comply with current
repayment terms. Those loans are subject to constant management
attention, and their classification is reviewed on a regular basis. At
September 30, 2000, the potential problem loans were $14.6 million and
included 10 lending relationships with principal balance in excess of
$500,000. Those 10 lending relationships had an aggregate principal
balance outstanding of $10.1 million.

LIQUIDITY

Liquidity requirements are measured by the need to meet deposit
withdrawals, fund loans, maintain reserve requirements and operate the
organization. To meet its liquidity needs, F&M maintains cash reserves
and has an adequate flow of funds from maturing loans, investment
securities, and short-term investments. In addition, F&M's affiliate
banks have the ability to borrow from the Federal Reserve Bank and the
Federal Home Loan Bank. F&M considers its sources of liquidity to be
ample to meet its estimated needs.

CAPITAL RESOURCES
F&M's strong capital position provides the resources and flexibility
for anticipated growth.

F&M's risk-based capital position at September 30, 2000 was $301.1
million, or 14.0% of risk-weighted assets, for Tier I capital and
$325.5 million, or 15.2% for total risk based capital.

Tier I capital consists primarily of common shareholders' equity, while
total risk-based capital adds the allowance for loan losses to Tier I.
Risk-weighted assets are determined by assigning various levels of risk
to different categories of assets and off-balance sheet activities.
Under current risk-based capital standards, banks are well capitalized
if they have Tier I capital of at least 6% and total risk-based capital
of 10%.



ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

There have been no material changes in information reported as of
December 31, 1999, in Form 10-K.

FORM 10-Q   PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

There are no material legal proceedings to which the Registrant or any
of its subsidiaries, directors or officers is a party or by which they,
or any of them, are threatened. All legal proceedings presently pending
or threatened against F & M and its subsidiaries involve routine
litigation incidental to the business of F&M  or the subsidiary
involved and are either not material in respect to the amount in
controversy or fully covered by insurance.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a)  Exhibits:

       (2)  Plan of Acquisition, Reorganization, Arrangement,
            Liquidation, or Succession - not applicable.

       (3)  (i)  Articles of Incorporation - not applicable.
            (ii) By-laws - not applicable.

       (4)  Instruments Defining the Rights of Security Holders Including
            Indentures - not applicable.

      (10)  Material Contracts.

            Incorporated herein by reference to Registrant's Form 10-K
            Annual Report for the year ended December 31, 1999, filed
            with the Commission on March 29, 2000, under Exhibit 10.

      (11)  Statement re Computation of Per Share Earnings.

            Incorporated herein by reference to Note 11, page 37, of
            Registrant's 1999 Annual Report to Shareholders filed as
            Exhibit 13 to Form 10-K for the year ended December 31, 1999,
            filed with the Commission on March 29, 2000.

      (15)  Letter re Unaudited Interim Financial Information - not
            applicable.

      (18)  Letter re change in accounting principles - not applicable.

      (19)  Reports furnished to security holders.

            Incorporated herein by reference to Registrant's Notice of
            Annual Meeting and Proxy Statement dated March 24, 2000,
            filed with the Commission on March 22, 2000.


<PAGE>
     (22)  Published Report Regarding Matters Submitted to Vote of
            Security Holders - not applicable.

      (23)  Consent of Experts and Counsel - not applicable.

      (24)  Power of Attorney - not applicable.

      (27)  Financial Data Schedules - Included herein as Exhibit 27.

      (99)  Additional Exhibits - None.

(b)   Reports on Form 8-K.

      (1)   July 18, 2000, for event of July 12, 2000, under Item 5. to
            report authorization of the Registrant's Board of Directors
            for management to purchase 250,000 additional shares of the
            Registrant's common stock on the open market.




                                      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.

F & M NATIONAL CORPORATION



/s/  Alfred B. Whitt
Alfred B. Whitt
President/CEO, Vice Chairman, and Chief Financial Officer



/s/  Charles E. Curtis
Vice Chairman and Chief Administrative Officer

Date:  November 14, 2000