Table of Contents

UNITED STATESSECURITIES AND EXCHANGE
COMMISSION

Washington, D.C. 20549

FORM 10-QSB

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE
SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2003

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 2-94292

FNB Banking Company(Exact name of registrant as specified in its charter)




Georgia

58-1479370(State of Incorporation)

(I.R.S. Employer Identification No.)




318 South Hill StreetGriffin, Georgia  30224(Address of principal executive offices)




770-227-2251(Issuer’s Telephone Number, Including Area Code)


State the number of shares outstanding of each of theissuer’s
classes of common equity, as of the latest practicable
date:

Common stock, par value $1 per share: 730,674 sharesoutstanding as of May 6,
2003

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FNB BANKING COMPANY AND SUBSIDIARY

INDEX

Page No.PART I
FINANCIAL INFORMATIONItem 1.
Financial StatementsConsolidated Balance Sheet (unaudited) at March 31, 2003
3Consolidated Statements of Earnings(unaudited) for the ThreeMonths Ended March 31, 2003 and 2002
4Consolidated Statements of Comprehensive Income (unaudited)for the Three Months Ended March 31, 2003 and 2002
5Consolidated Statements of Cash Flows(unaudited) for theThree Months Ended March 31, 2003 and 2002
6Notes to Consolidated Financial Statements (unaudited)
7 - 9Item 2.
Management’s Discussion and Analysis of Financial Condition andResults of Operations
10 - 11Item 3.
Controls and Procedures
12PART II.
OTHER INFORMATIONItem 1.
Legal Proceedings
13Item 2.
Changes in Securities
13Item 3.
Defaults Upon Senior Securities
13Item 4.
Submission of Matters to a Vote of Security Holders
13Item 5.
Other Information
13Item 6.
Exhibits and Reports on Form 8-K
13SIGNATURES
14




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PART I.  FINANCIAL INFORMATION

Item 1.   Financial Statements

FNB BANKING COMPANY AND SUBSIDIARY

Consolidated Balance Sheet

March 31, 2003(Unaudited)

AssetsCash and due from banks
$
25,434,451Federal funds sold

6,442,989Cash and cash equivalents

31,877,440Interest-bearing deposits with other banks

294,000Investment securities available for sale

36,861,339Other investments

1,275,100Mortgage loans held for sale

1,748,600Loans

230,551,121Less: Unearned interest and fees

222,125Allowance for loan losses

3,408,612Loans, net

226,920,384Premises and equipment, net

7,562,099Goodwill

4,401,920Accrued interest receivable and other assets

2,675,887$
313,616,769Liabilities and Stockholders’ EquityLiabilities:Deposits:Noninterest-bearing
$
41,743,931Interest-bearing

204,082,239Total deposits

245,826,170Retail repurchase agreements

15,963,361FHLB advances

13,218,750Note payable

7,246,200Accrued interest payable and accrued liabilities

2,220,684Total liabilities

284,475,165Stockholders’ equity:Common stock, $1 par value; 5,000,000 shares authorized;730,674 shares issued and outstanding

730,674Retained earnings

27,040,758Accumulated other comprehensive income

1,370,172Total stockholders’ equity

29,141,604$
313,616,769


See accompanying notes to unaudited consolidated financial
statements.

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FNB BANKING COMPANY AND SUBSIDIARY

Consolidated Statements of Earnings

For the Three Months Ended March 31, 2003 and 2002(Unaudited)

2003

2002Interest income:Interest and fees on loans
$
4,271,641

3,622,104Interest on investment securities:Tax-exempt

123,358

131,160Taxable

363,514

427,162Interest on federal funds sold

9,136

39,707Total interest income

4,767,649

4,220,133Interest expense:Deposits and repurchase agreements

852,749

1,289,365Federal funds purchased and FHLB advances

62,850

-Notes payable

77,750

11,946Total interest expense

993,349

1,301,311Net interest income

3,774,300

2,918,822Provision for loan losses

147,365

200,804Net interest income after provision for loan losses

3,626,935

2,718,018Other operating income:Service charges on deposit accounts

494,814

456,088Fees for trust services

30,000

30,000Gain on sale of investments

2,155

-Other operating income

217,631

88,042Total other operating income

744,600

574,130Other operating expense:Salaries and employee benefits

1,666,737

1,438,313Occupancy and equipment

509,454

443,186Other operating expense

745,449

519,861Total other operating expense

2,921,640

2,401,360Earnings before income taxes

1,449,895

890,788Income taxes

489,423

279,227Net earnings
$
960,472

611,561Net earnings per common share based on average outstandingshares of  730,710 and 743,221 in 2003 and 2002, respectively
$
1.31


.82


See accompanying notes to unaudited consolidated financial
statements.

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FNB BANKING COMPANY AND SUBSIDIARY

Consolidated Statements of Comprehensive Income

For the Three Months Ended March 31, 2003 and 2002(Unaudited)

2003

2002Net earnings
$
960,472

611,561Other comprehensive income (loss), net of tax:Unrealized holding gains (losses) on investment securities available
for sale arising      during the period

23,822

333,484Unrealized holding gains (losses) on derivative financial
instruments classified as      cash flow hedges, arising during the period

(125,593)

-Reclassification adjustment for (gains) losses on investment
securities available for      sale

(2,155)

-Total other comprehensive income (loss), before tax

(103,926)

333,484Income taxes related to other comprehensive income:Unrealized holding gains (losses) on investment securities available
for sale arising      during the period

(9,052)

(126,724)Unrealized holding gains (losses) on derivative financial
instruments classified as      cash flow hedges, arising during the period

47,725

-Reclassification adjustment for losses on investment securities
available for sale

819


-Total income taxes related to other comprehensive income (loss)

39,492

(126,724)Total other comprehensive income, net of tax

(64,434)

206,760Total comprehensive income
$
896,038

818,321


See accompanying notes to unaudited consolidated financial
statements

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FNB BANKING COMPANY AND SUBSIDIARY

Consolidated Statements of Cash Flows

For the Three Months Ended March 31, 2003 and 2002(Unaudited)

2003

2002Cash flows from operating activities:Net earnings
$
960,472

611,561Adjustments to reconcile net earnings to net cash provided by
operating activities:Provision for loan losses

147,365

200,804Depreciation, amortization and accretion

222,394

160,346Change in assets and liabilities:Mortgage loans held for sale

583,250

1,672,565Interest receivable

17,776

105,843Interest payable

(33,836
)

(61,617
)Other, net

161,172


58,761Net cash provided by operating activities
2,058,593


2,748,263Cash flows from investing activities:Change in interest-bearing deposits with other banks
100,000


-Proceeds from maturities, calls and paydowns of investment
securities         available for sale

3,267,617


1,771,482Purchases of investment securities available for sale

-

(1,690,999
)Net change in loans

2,850,781

(643,419
)Purchases of premises and equipment

(61,634
)

(396,096
)Net cash provided by (used by) investing activities

6,156,764

(959,032
)Cash flows from financing activities:Net change in deposits

12,444,520

996,927Net change in retail repurchase agreements

(82,090
)
(1,609,523
)Proceeds from FHLB advances

6,500,000

-Proceeds from note payable

3,874

-Repayments of FHLB advances

(7,781,250
)
(31,250
)Payments for remaining shares tendered of ACB

(62,759
)
-Payment of cash dividend

(548,204
)
(540,403
)Purchase and retirement of common stock

(13,250
)
(1,999,995
)Net cash provided by (used by) financing activities

10,460,841

(3,184,244
)Net change in cash and cash equivalents

18,676,198

(1,395,013
)Cash and cash equivalents at beginning of period

13,201,242

20,214,880Cash and cash equivalents at end of period
$
31,877,440

18,819,867Supplemental disclosures of cash flow information:Cash paid for interest
$
1,027,185

1,362,928Cash paid for income taxes
$
269,888

-Noncash investing and financing activities:Change in accumulated other comprehensive income
$
(64,434
)
206,760


See accompanying notes to unaudited consolidated financial
statements.

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FNB BANKING COMPANY
AND SUBSIDIARY

Notes to Consolidated Financial Statements(Unaudited)

|(1) | Basis of Presentation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions for Form 10-QSB.  Accordingly,
they do not include all the information and footnotes required by generally
accepted accounting principles for complete financial statements.  In the
opinion of management, all adjustments (consisting of normal recurring
adjustments) considered necessary for a fair presentation have been included.
Operating results for the three-month period ended March 31, 2003, are not
necessarily indicative of the results that may be expected for the year ending
December 31, 2003.  For further information, refer to the consolidated financial
statements and footnotes included in the Company’s annual report on Form
10-KSB for the year ended December 31, 2002.                                                                                           
|   
|(2) | Business Combination                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    | On May 31, 2002, the Company consummated an agreement to acquire all of the
outstanding shares of American Community Bank (“ACB”) for
approximately $9.9 million in cash ($13.35 per share) plus certain acquisition
costs.  ACB was a banking corporation based in Stockbridge (Henry County)
Georgia with approximately $55.3 million in total assets, $40.8 million in loans
and $46.3 million in deposits.  The primary reason for the acquisition was to
expand the Company’s banking franchise into the high growth area of
eastern Henry County, Georgia.  The Company accounted for this transaction using
the purchase method and accordingly, the original purchase price was allocated
to assets and liabilities acquired based upon their fair values at the date of
the acquisition. The excess of the purchase price over the fair value of the net
assets acquired (goodwill) was approximately $4.4 million.  ACB was merged into
First National Bank of Griffin and is operated as a branch.
|   
|    | The cash proceeds to consummate the purchase were obtained through a combination
of borrowings under a line of credit with a correspondent bank and cash
dividends paid to the Company by its bank subsidiary, First National Bank of
Griffin.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|    | The results of ACB have been included in the Company’s consolidated
statements of earnings since May 31, 2002, the date of the acquisition.  The
following summarized proforma unaudited financial information is presented as if
the purchase had occurred at the beginning of the period, and therefore includes
adjustments for additional interest expense and amortization of intangibles and
other purchase accounting adjustments. The unaudited proforma financial
information is not necessarily indicative either of the results of operations
that would have occurred had the two companies actually been combined during the
period presented or of future results of operations of the combined
companies.                                                                                                                                                                                                                                                                                     



Three
monthsendedMarch 31,
2002Interest income
$
5,102,646Interest expense

(1,650,461
)Net interest income

3,452,185Provision for loan losses

(208,804
)Net interest income after provision for loan  losses

3,243,381Other income

651,035Other expense

(2,848,786
)Earnings before income taxes

1,045,630Income taxes

(336,921
)Net earnings
$
708,709Net earnings per common share
$
.95Weighted average common shares outstanding

743,221


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FNB BANKING COMPANY AND SUBSIDIARY

Notes to Consolidated Financial Statements, continued(Unaudited)

|(2) | Business Combination, continued                                                                                                                                                                                                                                                                                   
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | Certain fair value adjustments for deposits which were recorded as purchase
accounting adjustments will be amortized over a period of one year and will not
be recurring.  Net earnings were increased in the above proforma presentations
for the amortization of this purchase accounting adjustment as follows:



Three monthsendedMarch 31, 2002Reduction in interest expense
$
187,500Related income taxes

(71,250)Net earnings effect
$
116,250




|(3) | Derivative Instruments and Hedging Activities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | The fair value of derivatives is recognized in the financial statements as
assets or liabilities.  The accounting for the changes in the fair value of a
derivative depends on the intended use of the derivative instrument at
inception.  The change in fair value of instruments used as fair value hedges is
accounted for in the income of the period simultaneous with accounting for the
fair value change of the item being hedged.  The change in fair value of the
effective portion of cash flow hedges is accounted for in comprehensive income
rather than income.  The change in fair value of derivative instruments that do
not qualify as a hedge is accounted for in the income of the period of the
change.                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | The Company maintains an overall interest rate risk-management strategy that
incorporates the use of derivative instruments to minimize fluctuations in
earnings that are caused by interest rate volatility.  The goal is to manage
interest rate sensitivity by modifying the repricing or maturity characteristics
of certain balance sheet assets and liabilities so that the net interest margin
is not, on a material basis, adversely affected by movements in interest rates.
As a result of interest rate fluctuations, hedged assets and liabilities will
appreciate or depreciate in fair value.  The effect of this unrealized
appreciation or depreciation will generally be offset by earnings or loss on the
derivative instruments that are linked to the hedged assets and liabilities.
The Company views this strategy as a prudent management of interest rate
sensitivity, such that earnings are not exposed to undue risk presented by
changes in interest rates.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | Derivative instruments that are used as part of the Company’s interest
rate risk-management strategy include interest rate swap contracts.  Interest
rate swaps generally involve the exchange of fixed- and variable-rate interest
payments between two parties, based on a common notional principal amount and
maturity date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | By using derivative instruments, the Company is exposed to credit and market
risk.  If the counterparty fails to perform, credit risk is equal to the extent
of the fair-value gain in a derivative.  When the fair value of a derivative
contract is positive, this generally indicates that the counterparty owes the
Company, and, therefore, creates a repayment risk for the Company.  When the
fair value of a derivative contract is negative, the Company owes the
counterparty and, therefore, it has no repayment risk.  The Company minimizes
the credit risk in derivative instruments by entering into transactions with
high-quality counterparties that are reviewed periodically.                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | The Company’s derivative activities are monitored by its asset/liability
management function as part of that group’s oversight of asset/liability
and treasury functions.  This group is responsible for implementing various
hedging strategies that are developed through its analysis of data from
financial simulation models and other internal and industry sources.  The
resulting hedging strategies are then incorporated into the overall
interest-rate risk management.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | During the first quarter of 2003, the Company entered into an interest rate swap
agreement to partially offset the interest rate risk associated with the loan
used to finance the purchase of American Community Bank. The loan amount was
$7,432,000 at a floating rate of 110 basis points below prime amortizing over a
term of 10 years. The notional amount of the swap is $5,000,000, with an
interest rate of 5.75%, also with a term of ten years. The notional amount of
the swap, however, is structured to amortize at a slower rate than the loan for
the first five years, at which point the loan balance and the swap balance will
be equal, and will amortize at the same rate for the remaining five years.                                                                                                                                                                                                                                                          

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FNB BANKING COMPANY AND SUBSIDIARY

Notes to Consolidated Financial Statements, continued(Unaudited)

|(3) | Derivative Instruments and Hedging Activities, continued                                                                                                                                                                                                                                                                                                                  
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | At March 31, 2003, the swap is being accounted for as a cash flow hedge and its
fair value is included in other comprehensive income, net of taxes.  At March
31, 2003, the Company recorded a liability for $125,593 to reflect the fair
value of the swap.  No hedge ineffectiveness from this cash flow hedge was
recognized in the consolidated statement of earnings.







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Item 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITIONAND RESULTS OF OPERATIONSFor the Three Months in the Periods EndedMarch 31, 2003 and
2002


Forward-Looking Statements

This discussion contains forward-looking statements under the Private Securities
Litigation Reform Act of 1995 that involve risks and uncertainties.  Although
the Company believes the assumptions underlying the forward-looking statements
contained in the discussion are reasonable, any of the assumptions could be
inaccurate, and therefore, no assurance can be made that any of the
forward-looking statements included in this discussion will be accurate. Factors
that could cause actual results to differ from results discussed in
forward-looking statements include, but are not limited to:  economic conditions
(both generally and in the markets where the Company operates); competition from
other providers of financial services offered by the Company; government
regulation and legislation; changes in interest rates; and material unforeseen
changes in the financial stability and liquidity of the Company’s credit
customers;  all of which are difficult to predict and which may be beyond the
control of the Company. The Company undertakes no obligation to revise
forward-looking statements to reflect events or changes after the date of this
discussion or to reflect the occurrence of unanticipated events.

Financial Condition

Total assets at March 31, 2003, were $313.6 million, representing a $12.1
million (4%) increase from December 31, 2002. Deposits increased $12.4 million
(5%) from December 31, 2002. Loans (gross) decreased $2.9 million (1%). The
allowance for loan losses at March 31, 2003, totaled $3.4 million, representing
1.5% of total loans compared to December 31, 2002 total of $3.3 million
representing 1.4% of total loans. Cash and cash equivalents increased $18.7
million from December 31, 2002.

The following summarizes non-performing assets:

March 31,2003

December 31,2002Other real estate and repossessions
$
78,800

-Accruing loans 90 days or more past due

-

33,000Non-accrual loans

3,827,300

3,534,800$
3,906,100

3,567,800


The total of non-accrual loans increased 8.3% or $292,500 from $3,534,800 at
December 31, 2002 to $3,827,300 at March 31, 2003.  The increase is the net
result of the following changes:

Balance at December 31, 2002
$
3,534,800Loans reclassified to non-accrual in 2003

590,900Loans with improved performance and placed back on accrual status
       during
2003

(152,200)Payments received on non-accrual loans during 2003

(108,900)Non-accrual loans that were charged-off during 2003

(37,300)$
3,827,300


Other real estate at March 31, 2003, consisted of one property with a modular
home on 2.5 acres of land.  The Company expects no loss on the disposition of
the other real estate.

In April 2003, non-accrual loans decreased by $943,000 as a result of
liquidating the collateral associated with one of the non-accrual loans.
Approximately $59,000 was charged off in connection with the
liquidation.

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The Company’s subsidiary bank was most recently examined by its primary
regulatory authority in June 2002.  All recommendations by the regulatory
authority that, in management’s opinion, would have a material effect on
the Company’s liquidity, capital resources or operations have been
implemented.

Results of Operations

For the three months ended March 31, 2003, the Company reported net earnings of
$960,472, or $1.31 per share, compared to $611,561, or $.82 per share, for the
same period in 2002.

Net interest income is the primary source of the Company’s operating
income.  Net interest income increased approximately $855,500 (29.3%) in the
first three months of 2003 compared to the same period for 2002. Interest income
for the first three months of 2003 was $4.8 million, representing an increase of
$548,000 (13%) over the same period in 2002. Interest expense for the first
three months of 2003 decreased $308,000 (23.7%) compared to the same period in
2002. The increase in net interest income during the first three months of 2003
compared to the same period in 2002 is primarily due to the volume increases
associated with the ACB agreement  in the second quarter of 2002, although the margin increase did account for 20% of the
increase.  For the three months ended March 31, 2003, the net interest margin was 5.49% compared to
5.01% during the first quarter of 2002.

The provision for loan losses for the first three months of 2003 decreased
approximately $53,400 compared to the same period for 2002. For the three months
ended March 31, 2003, the Bank experienced net loan charge-offs of approximately
$37,300, compared to net charge-offs of $120,000 for the corresponding
three-month period in 2002.  It is management’s belief that the allowance
for loan losses is adequate to absorb probable losses in the portfolio.

Other operating income increased for the three months ended March 31, 2003 by
approximately $170,500, or 29.7%, compared to the same period in 2002, primarily
due to a $78,500 increase in gains on mortgage loans sold as the refinance
market volume is high due to low  interest rates.  The
inclusion of ACB data in the three-month period ended March 31, 2003, accounts
for the majority of the balance of the increase.

Other operating expenses for the first three months of 2003 increased
approximately $520,300 (21.7%) compared to the first three months in 2002.
Salaries and benefit expenses increased approximately $228,400 (15.9%);
occupancy expenses increased approximately $66,300 (15.0%) and all other
operating expenses increased by approximately $225,600 (43.3%). All of these
increases are primarily due to the inclusion of the American Community Bank
data, which is not included in the first quarter of 2002 as the acquisition did
not occur until the second quarter of 2002.  Additionally, losses on deposit
account fraud and other losses increased the operating expense by $90,000 in
2003 compared to 2002.

Income tax expense, expressed as a percentage of earnings before income taxes,
increased to 34% for the period ended March 31, 2003 compared to 31% for the
same period in 2002 as tax exempt income expressed as a percentage of pretax
earnings decreased in 2003.

Capital

The following tables present FNB Banking Company’s consolidated regulatory
capital position at March 31, 2003:

| | Risk-Based Capital Ratios                        |      |  
| | ------------------------------------------------ | ---- | -
| | Tier 1 Capital, Actual                           | 9.5  | %
| | Tier 1 Capital minimum requirement               | 4.0  | %
| |                                                  |      |  
| | Excess                                           | 5.8  | %
| |                                                  |      |  
| | Total Capital, Actual                            | 10.7 | %
| | Total Capital minimum requirement                | 8.0  | %
| |                                                  |      |  
| | Excess                                           | 2.7  | %
| |                                                  |      |  
| | Leverage Ratio                                   |      |  
| | Tier 1 Tangible Capital to adjusted total assets |      |  
| | (“Leverage Ratio”)                               | 7.6  | %
| | Minimum leverage requirement                     | 3.0  | %
| |                                                  |      |  
| | Excess                                           | 4.6  | %

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Item 3.

Controls and ProceduresOur management, including the chief executive and chief financial officers,
supervised and participated in an evaluation of our disclosure controls and
procedures (as defined in federal securities rules) within the 90 days before we
filed this report. Based on that evaluation, our CEO and CFO have concluded that
our disclosure controls and procedures are effective in accumulating and
communicating information to our management, including our President and CEO and
CFO, as appropriate to allow timely decisions regarding required disclosures of
that information under the Securities and Exchange Commissions rules and forms
and that our disclosure controls and procedures are designed to ensure that the
information we are required to disclose in reports that we file or submit under
all applicable federal securities law is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commissions rules and forms.
There were no significant changes in our internal controls or in other
factors that could significantly affect these controls subsequent to the date of
their evaluation.





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PART II.   OTHER INFORMATION

FNB BANKING COMPANY AND SUBSIDIARY

|Item 1. | Legal Proceedings                                  
|------- | ---------------------------------------------------
|       
|        | None                                               
|       
|Item 2. | Changes in Securities                              
|       
|        | None                                               
|       
|Item 3. | Defaults Upon Senior Securities                    
|       
|        | None                                               
|       
|Item 4. | Submission of Matters to a Vote of Security Holders
|       
|        | None                                               
|       
|Item 5. | Other Information                                  
|       
|        | None                                               
|       
|Item 6. | Exhibits and Reports on Form 8-K                   
|        |                                                    
|        | a)                                                 
|        |                                                    
|        |                                                    
|        |                                                    
|        | b)                                                 

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FNB BANKING COMPANY AND SUBSIDIARY

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.

FNB BANKING COMPANYBy: /s/ J. Charles CopelandJ. Charles Copeland, President(Chief Executive Officer)Date: May 12, 2003By:_/s/ Mark FlowersMark Flowers, Assistant Treasurer(Chief Accounting Officer)Date: May 12, 2003








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CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS
ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF
2002

This Certificate is being
delivered pursuant to the requirements of Section 1350 of Chapter 63 (Mail
Fraud) of Title 18 (Crimes and Criminal Procedures) of the United States Code
and shall not be relied on by any person for any other purpose.

The undersigned, who are the Chief
Executive Officer and Chief Financial Officer, respectively, of FNB Banking
Company (the “Company”), hereby each certify as follows:

The Quarterly Report on Form 10-QSB of the Company (the
Report) for the period ended March 31, 2003, which accompanies this Certificate, fully complies with the
requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934,
and all information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.

This 12th day of May 2003



/s/ J. Charles Copeland
J. Charles Copeland, President
(Chief Executive Officer)

/ s/ Mark Flowers
Mark Flowers, Assistant Treasurer
(Chief Financial Officer)