UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC  20549 FORM 10-Q  x
  QUARTERLY REPORT
  PURSUANT TO SECTION 13 OR 15(d)
  OF THE SECURITIES EXCHANGE ACT OF 1934
  For the quarterly period ended March 31, 2001OR ̈
  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 0-19368 COMMUNITY FIRST BANKSHARES, INC.(Exact name of
registrant as specified in its charter)  Delaware
  46-0391436(State
  or other jurisdiction of
  (I.R.S.
  Employer Identification No.)incorporation
  or organization)520 Main AvenueFargo, ND
  58124(Address
  of principal executive offices)
  (Zip
  Code)(701) 298-5600(Registrants
  telephone number, including area code)
  Indicated
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days: YESxNO ̈ At
May 8, 2001, 41,154,249 shares of Common Stock were outstanding.  
 COMMUNITY
FIRST BANKSHARES, INC.

FORM
10-Q

QUARTER
ENDED MARCH 31, 2001

INDEX

PART I - FINANCIAL INFORMATION:Item 1.
  Condensed
  Consolidated Financial Statements and NotesItem 2.
  Managements
  Discussion and Analysis of Financial Condition and Results of OperationsItem 3
  .Quantitative
  and Qualitative Disclosure About Market RiskPART II - OTHER INFORMATION:Item 1.
  Legal ProceedingsItem 2.
  Changes in SecuritiesItem 3.
  Defaults Upon
  Senior SecuritiesItem 4.
  Submission
  of Matters to a Vote of Security HoldersItem 5.
  Other InformationItem 6.
  Exhibits and
  Reports on Form 8-KSIGNATURES

COMMUNITY FIRST BANKSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Dollars in thousands, except per share
  data)
  March 31,
  December 31,(Unaudited)
  2001
  2000ASSETSCash
  and due from banks
  $222,669
  $256,136Federal
  funds sold and securities purchased underagreements to resell
  4,450
  -Interest-bearing
  deposits
  1,430
  1,110Available-for-sale
  securities
  1,616,761
  1,714,510Held-to-maturity
  securities (fair value: 3/31/01 -$74,081, 12/31/00 - $73,222)
  74,081
  73,222Loans
  3,750,323
  3,738,202Less: Allowance for loan losses
  (52,497)
  (52,168)Net
  loans
  3,697,826
  3,686,034Bank
  premises and equipment, net
  123,100
  121,675Accrued
  interest receivable
  47,697
  52,494Intangible
  assets
  106,637
  114,971Other
  assets
  73,266
  69,577Total
  assets
  $5,967,917
  $6,089,729LIABILITIES
  AND SHAREHOLDERS EQUITYDeposits:Noninterest-bearing
  $461,564
  $500,834Interest-bearing:Savings and NOW accounts
  2,304,056
  2,349,606Time Accounts over $100,000
  748,514
  672,968Other time accounts
  1,413,335
  1,496,483Total
  deposits
  4,927,469
  5,019,891Federal
  funds purchased and securities sold underagreements to repurchase
  249,296
  205,758Other
  short-term borrowings
  125,582
  203,952Long-term
  debt
  119,272
  123,957Accrued
  interest payable
  43,358
  45,489Other
  liabilities
  33,309
  25,251Total
  liabilities
  5,498,286
  5,624,298Company-obligated
  mandatorily redeemablepreferred securities of CFB Capital I
  & II
  120,000
  120,000Shareholders'
  equity:Common
  stock, par value $.01 per share:Authorized Shares 
  80,000,000Issued Shares  51,021,896
  510
  510Capital surplus
  192,368
  192,368Retained earnings
  315,061
  315,091Unrealized
  gain (loss) on available-for-salesecurities, net of tax
  1,806
  (9,486)Less
  cost of common stock in treasury -March 31, 2001  9,552,105 sharesDecember 31, 2000  9,155,144
  shares
  (160,114)
  (153,052)Total
  shareholders' equity
  349,631
  345,431Total
  liabilities and shareholders' equity
  $5,967,917
  $6,089,729See
  accompanying notes.



COMMUNITY
FIRST BANKSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME

For
  the Three Months EndedMarch 31,(Dollars
  in thousands, except per share data)(Unaudited)
  2001
  2000Interest
  income:Loans
  $87,521
  $84,985Investment securities
  27,556
  32,226Interest-bearing deposits
  62
  68Federal funds sold and resale agreements
  36
  151Total interest income
  115,175
  117,430Interest
  expense:Deposits
  42,331
  37,880Short-term and other borrowings
  5,564
  9,688Long-term debt
  2,193
  1,367Total interest expense
  50,088
  48,935Net
  interest income
  65,087
  68,495Provision
  for loan losses
  5,617
  4,990Net
  interest income after provision for loan losses
  59,470
  63,505Noninterest
  income:Service charges on deposit accounts
  9,453
  9,663Insurance commissions
  3,050
  2,409Fees from fiduciary activities
  1,506
  1,497Security sales commissions
  1,076
  1,961Net gain on sales of
  available-for-sale securities
  484
  4Other
  3,723
  2,951Total noninterest income:
  19,292
  18,485Noninterest
  expense:Salaries and employee benefits
  28,007
  27,186Net occupancy
  8,187
  8,150FDIC insurance
  242
  274Legal and accounting
  835
  801Other professional service
  1,314
  1,037Restructuring charge
  7,656
  -Data processing
  890
  1,136Company-obligated
  mandatorily redeemable preferredsecurities of CFB Capital I & II
  2,561
  2,561Amortization of intangibles
  2,601
  2,623Other
  10,722
  10,379Total noninterest expense
  63,015
  54,147Income
  before income taxes
  15,747
  27,843Provision
  for income taxes
  5,519
  9,180Net
  income
  $10,228
  $18,663For the Three Months
  EndedMarch 31,(Dollars
  in thousands, except per share data)(Unaudited)
  2001
  2000Earnings
  per common and common equivalent share:Basic
  net income
  $0.25
  $0.37Diluted
  net income
  $0.24
  $0.37Average
  common shares outstanding:Basic
  41,590,689
  50,312,866Diluted
  41,997,381
  50,613,345Dividends per share
  $0.16
  $0.15

STATEMENTS
OF COMPREHENSIVE INCOME



For the Three Months
  EndedMarch 31(Dollars
  in thousands, except per share data)
  (Unaudited)
  2001
  2000Net
  income
  $10,228
  $18,663Other
  comprehensive income, net of tax:Unrealized gains (losses) on securities:Unrealized holding gains (losses)
  arising during period
  11,582
  (7,174)Less: Reclassification adjustment for
  gainsincluded in net income
  (290)
  (2)Other
  comprehensive income
  11,292
  (7,176)Comprehensive
  income
  $21,520
  $11,487COMMUNITY
FIRST BANKSHARES, INC.

CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Three Months
  EndedMarch 31(In
  thousands)(Unaudited)
  2001
  2000Cash
  flows from operating activities:Net
  income
  $10,228
  $18,663Adjustments
  to reconcile net income to net cashprovided
  by operating activities:Provision for loan losses
  5,617
  4,990Depreciation
  3,326
  3,712Amortization of intangibles
  2,601
  2,623Net of amortization of premiums
  (discounts) on securities
  (191)
  131Decrease in interest receivable
  4,797
  827Decrease in interest payable
  (2,131)
  (141)Other
  - net
  2,716
  (2,100)Net
  cash provided by operating activities
  26,963
  28,705Cash
  flows from investing activities:Net decrease (increase) in
  interest-bearing deposits
  (320)
  1,628Purchases of available-for-sale
  securities
  (219,749)
  (53,500)Maturities of available-for-sale securities
  312,881
  59,037Sales of available-for-sale
  securities, net of gains
  23,486
  6,760Purchases of held-to-maturity
  securities
  (859)
  (849)Net increase in loans
  (17,409)
  (236)Net increase in bank premises and
  equipment
  (4,751)
  (1,373)Net
  cash provided by investing activities
  93,279
  11,467Cash
  flows from financing activities:Net
  decrease in demand deposits, NOWaccounts and savings accounts
  (84,820)
  (39,087)Net
  (decrease) increase in time accounts
  (7,602)
  36,077Net
  decrease in short-term & other borrowings
  (34,832)
  (47,994)Net
  decrease in long-term debt
  (4,685)
  (5,658)Purchase
  of common stock held in treasury
  (11,829)
  (1,420)Sale
  of common stock held in treasury
  1,165
  3,408Common
  stock dividends paid
  (6,656)
  (7,569)Net
  cash used in financing activities
  (149,259)
  (62,243)Net
  decrease in cash and cash equivalents
  (29,017)
  (22,071)Cash
  and cash equivalents at beginning of period
  256,136
  251,826Cash
  and cash equivalents at end of period
  $227,119
  $229,755

COMMUNITY
FIRST BANKSHARES, INC.

NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH
31, 2001

Note A
- BASIS OF PRESENTATION

The accompanying unaudited condensed
consolidated financial statements, which include the accounts of Community
First Bankshares, Inc. (the 'Company'), its wholly-owned data processing,
credit origination, insurance agency and properties subsidiaries, and its
wholly-owned subsidiary bank, have been prepared in accordance with generally
accepted accounting principles for interim financial information.  Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements.  In
the opinion of management, all adjustments considered necessary for fair
presentation have been included.

Earnings Per Common Share

Basic
earnings per common share is calculated by dividing net income by the weighted
average number of shares of common stock outstanding.

Diluted earnings per common share is
calculated by dividing net income by the weighted average number of shares of
common stock outstanding.  The weighted
average number of shares of common stock outstanding is increased by the number
of shares of common stock that would be issued assuming the exercise of stock
options and warrants during each period. 
Such adjustments to the weighted average number of shares of common
stock outstanding are made only when such adjustments dilute earnings per
share.

Note B  RESTRUCTURING CHARGE

On
March 22, 2001, the Company announced a restructuring charge related to a
series of strategic initiatives designed to improve customer service and
strengthen the Companys position as a provider of diversified financial
services. The Company has designated each of its offices as either a Regional
Financial Center or a Community Financial Center.  Regional Financial Centers are those locations exhibiting strong
commercial banking potential, while, Community Financial Centers offer greater
retail opportunities.  As a consequence
of the new delivery structure, the Company entered into sales agreements to
sell 12 offices and will close an additional nine offices, resulting in a
one-time after-tax charge against earnings of $5.1 million, or approximately
$0.12 per share, on a diluted basis.  
The restructuring charge included approximately $3.1 million related to
asset write-down, data processing, and legal and accounting fees.  Additionally the Company recorded an
after-tax expense of approximately $2.0 million to provide for severance
related costs associated with the early-out and reduction-in-force programs.

During
the quarter, the Company completed the consolidation of all banking offices
into one nationally chartered institution and announced the implementation of a
centralized consumer credit process.

Note C  BUSINESS DIVESTITURES

On
March 22, 2001, the Company announced an agreement to sell eight Arizona
branches to The Stockmens Bank, Kingman, Arizona.  The branches, located in Ajo, Bagdad, Duncan, Gila Bend, Morenci,
Patagonia, Sacaton and Yarnell, Arizona, have assets of approximately $98
million.  The transaction is subject to
regulatory approval and is expected to close in the second quarter of 2001.

On
March 22, 2001, the Company announced an agreement to sell three Nebraska
branches to Security First Bank, Sidney, Nebraska. The branches, located in
Cody, Merriman and Thedford, Nebraska, have assets of approximately $19
million.  The transaction is subject to
regulatory approval and is expected to close in the third quarter of 2001.

On
March 22, 2001, the Company announced an agreement to sell its Hankinson, North
Dakota branch to Lincoln State Bank, Hankinson, North Dakota.  The branch has assets of approximately $5
million.  The transaction is subject to
regulatory approval and is expected to close in the third quarter of 2001.

Note D  ACCOUNTING CHANGES

Effective
January 1, 2001, the Company adopted SFAS 133, Accounting for Derivative Instruments
and Hedging Activities, which establishes accounting and reporting standards
for derivative instruments, including certain derivative instruments embedded
in other contracts, and for hedging activities.  It requires that an entity recognize all derivatives as either
assets or liabilities in the statement of financial position and measure those
instruments at fair value.  In certain
defined conditions, a derivative may be specifically designated as a hedge for
a particular exposure.  The accounting
for changes in fair value of the derivative depends on the intended use of the
derivative and the resulting designation. 
As of March 31, 2001 and December 31, 2000, the Company had no
derivative instruments outstanding.

Note E- INVESTMENTS

The following is a summary of
available-for-sale and held-to-maturity securities at March 31, 2001 (in
thousands):

Available-for-Sale
  SecuritiesGross
  Gross
  EstimatedAmortized
  Unrealized
  Unrealized
  FairCost
  Gains
  Losses
  ValueUnited
  States Treasury
  $76,947
  $1,851
  $-
  $78,798United
  States Government agencies
  363,246
  3,392
  310
  366,328Mortgage-backed
  securities
  959,310
  8,771
  1,531
  966,550Collateralized
  mortgage obligations
  6,541
  56
  8
  6,589State
  and political securities
  110,715
  1,376
  404
  111,687Other
  securities
  97,035
  889
  11,115
  86,809$1,613,794
  $16,335
  $13,368
  $1,616,761

Held-to-Maturity SecuritiesGross
  Gross
  EstimatedAmortized
  Unrealized
  Unrealized
  FairCost
  Gains
  Losses
  ValueOther securities
  $74,081
  -
  -
  $74,081$74,081
  $-
  $-
  $74,081Proceeds from the sale of
available-for-sale securities during the three months ended March 31, 2001 and
2000 were $23,970,000 and $6,764,000, respectively.  Gross gains of $516,000 and $5,000 were realized on sales during
2001 and 2000, respectively.  Gross
losses of $32,000 and $1,000 were realized on sales during 2001 and 2000,
respectively.  Gains and losses on
disposition of these securities were computed using the specific identification
method.

Note F
- LOANS

The composition of the
  loan portfolio at March 31, 2001 was as follows (in thousands):Real estate
  $1,474,283Real estate construction
  493,082Commercial
  850,303Consumer and other
  689,693Agriculture
  242,9623,750,323Less allowance for loan
  losses
  (52,497)Net loans
  $3,697,826

Note G
- FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

In the normal course of business, the Company
is party to financial instruments with off-balance sheet risk to meet the
financing needs of its customers and to manage its interest rate risk.  These financial instruments include
commitments to extend credit and letters of credit.  The contract or notional amounts of these financial instruments
at March 31, 2001 were as follows (in thousands):

Commitments to extend credit
  $682,492Letters of credit
  26,492Note H
- SUBORDINATED NOTES

Long-term
debt at March 31, 2001 included $60 million of 7.30% Subordinated Notes issued
in June 1997.  These notes are due June
30, 2004, with interest payable semi-annually. 
At March 31, 2001, $36 million qualified as Tier 2 capital. At March 31,
2001, a subsidiary bank $25 million unsecured subordinated term note payable,
maturing on December 22, 2007, qualified as parent company Tier II capital
under the Federal Reserve Board guidelines. 
The subsidiary bank note bears an interest rate of LIBOR, plus 140 basis
points.

Note I
- INCOME TAXES

The reconciliation between the provision
for income taxes and the amount computed by applying the statutory federal
income tax rate was as follows (in thousands):



For the three months
  ended,March 31, 200135% of pretax income
  $5,566State income tax, net of federal
  tax benefit
  396Tax-exempt interest
  (1,325)Amortization of goodwill
  227Other
  655Provision for income taxes
  $5,519Note J
- SUPPLEMENTAL DISCLOSURES TO CONSOLIDATED STATEMENTS OF CASH FLOWS

Three
  months ended March 31 (in thousands)
  2001
  2000Unrealized
  gain (loss) on available-for-sale securities
  $18,678
  $11,791Item 2.  Managements Discussion and Analysis of
Financial Condition and Results of Operations

Basis
of Presentation

The following is a discussion of the
Companys financial condition as of March 31, 2001 and December 31, 2000, and
its results of operations for the three month periods ended March 31, 2001 and
2000.

Strategic
Initiatives

On
March 22, 2001 the Company announced a series of strategic initiatives designed
to improve customer service and strengthen its position as a provider of
diversified financial services.  
Initiatives included a redefinition of the Companys delivery model and
the sale or closure of banking offices.

In
an effort to properly align resources with market opportunities and provide the
delivery support structure to optimize individual market potential each of the
Companys offices was redefined as either a Regional Financial Center or a
Community Financial Center.  Regional
Financial Centers are those locations exhibiting strong commercial banking
potential; requiring a broader based support structure.  Community Financial Centers, which are less
geographically concentrated, typically offer greater retail opportunities,
including emphasis on insurance and investment product sales.

In
conjunction with the restructuring of the banking network, the Company
announced agreements to sell 12 offices and close nine additional offices.  Offices to be sold, in three separate
transactions, include eight Arizona offices, three Nebraska offices and one
office in North Dakota.  Four of the
nine offices slated for closure are located in communities where the Company
maintains one or more additional offices, thus continuing to serve those
customers from existing locations.

In
preparation for the sale of the eight Arizona offices, the Company charged off
its largest non-performing asset, a credit facility that was in the Arizona
bank at the time the Arizona bank was acquired by the Company.  To maintain the current loan loss reserve
level, the Company recorded a special loan loss provision equal to the amount
of the charge-off.  The special
provision of $2.4 million, or approximately $0.04 per share after tax was recorded
during the first quarter.

The
announced initiatives resulted in changes in staffing needs within the
Company.  To accommodate these, the
Company made available an early-out program that was accepted by 21 eligible
management personnel.

As
a result of these initiatives, the Company recorded a one-time after-tax
restructuring charge totalling $5.1 million. 
The charge was recorded during the first quarter and represents
approximately $0.12 per share.

Under
the redesigned delivery structure, the Company will implement a centralized
consumer credit process. Once fully operational, the central structure will
offer a complete range of decision, origination, documentation and collection
services to all Company offices through a Fargo, North Dakota location.

During
the first quarter, the Company completed the consolidation of its South Dakota
state chartered bank into its national chartered bank.  As a result of the consolidation, all
banking operations are conducted under a single national charter.

Overview

For the three months ended March
31, 2000, net income was $10.2 million, a decrease of $8.5 million or 45.5%
from the $18.7 million during the 2000 period. 
Basic earnings per common share for the three months ended March 31,
2001 were $0.25, compared to $0.37 in the same in 2000.  Diluted earnings per share for the three
months ended March 31, 2001 were $0.24. 
The decrease is principally due to a one-time after-tax charge of $5.1
million, or 12 cents per share, to account for the financial impact of a restructuring
charge recorded in the first quarter of 2001 and, the write-off of the
Companys largest non-performing loan and recognize a special loan loss
provision equal to the amount of the write-off of $1.5 million after-tax, or 4
cents per share.  Excluding the one-time
charge and the special loan loss provision, diluted earnings per share would
have been 40 cents per share.

Return
on average assets and return on common equity for the three months ended March
31, 2001 were 0.69% and 11.92%, respectively, as compared to the 2000 ratios of
1.20% and 18.53%.  The decrease in
return on assets and return on equity is principally due to a reduction in net
income.  However, the reduction in
average common shares outstanding, as a result of the Companys stock
repurchase initiative, has had an offsetting, positive impact on return on
equity.   Return on average assets and
return on average common equity, exclusive of the one-time charge and the
special loan loss provision, would have been 1.14% and 19.58%, respectively.

Results
of Operations

Net Interest Income

Net
interest income for the three months ended March 31, 2001 was $65.1 million, on
a tax-equivalent basis, a decrease of $3.4 million, or 5.0%, from the net
interest income of $68.5 million earned during the 2000 period. The decrease
was principally due to the combination of a $2.3 million reduction in interest
income and a $1.2 million increase in interest expense resulting from a $243
million reduction in average assets, coupled with an 4 basis point decrease in
net interest margin.  The net interest
margin of 4.96% for the period ended March 31, 2001 was down from 5.00% for the
2000 period.

Provision for Loan Losses

The
provision for loan losses for the three months ended March 31, 2001 was $5.6
million, an increase of $627,000, or 12.6%, from the $5.0 million provision
during the 2000 period. The increase is principally due to the $2.4 million
special loan loss provision recorded to reflect the charge-off of the Companys
largest non-performing asset, an Arizona based credit facility that was in
place when the Company acquired its initial Arizona operation in 1997; and the
Companys objective of maintaining adequate reserve levels.

Noninterest Income

Noninterest
income for the three months ended March 31, 2001 was $19.2 million, an increase
of $807,000, or 4.4%, from the 2000 level of $18.5 million. The increase was
principally due to a $641,000 or 26.6% increase in insurance commissions and a
$484,000 gain on the sale of investment securities.  Investment sales commissions for the 2001 period were $1.1
million, a decrease of $885,000, or 45.1% from the prior period, due
principally to the downturn in stock markets.

Noninterest Expense

Noninterest expense for the three
months ended March 31, 2001 was $63.0 million, an increase of $8.9 million, or
16.5%, from the level of $54.1 million during the 2000 period. The increase was
principally due to the $7.7 million one-time restructuring charge.  During the first quarter of 2001, the
Company recorded a $462,000 early payment penalty, when it elected to payoff
various Federal Home Loan Bank borrowings, which carried higher than market
interest rates.

Provision for Income Taxes

The provision for income taxes for the
three months ended March 31, 2001 was $5.5 million, a decrease of $3.7 million,
or 40.2%, from the 2000 level of $9.2 million, due primarily to the decrease in
pre-tax net income as a result of the one-time restructuring charge and the
special loan loss provision.  The
effective tax rate for the three months ended March 31, 2002 was 208 basis
points higher than the corresponding period in 2000 as a result of the one-time
restructuring charge recorded in the current quarter, which included the
write-off of various non-deductible intangible assets.

Financial
Condition

Loans

Total loans were $3.7 billion at March
31, 2001 and at December 31, 2000.

The following table presents the
Companys balance of each major category of loans:

March 31, 2001
  December 31, 2000Percent of
  
  Percent ofAmount
  Total Loans
  Amount
  Total LoansLoan
  category:
  (Dollars in Thousands)Real estate
  $1,474,283
  39.31%
  $1,458,494
  39.02%Real estate construction
  493,082
  13.15%
  466,616
  12.48%Commercial
  850,303
  22.67%
  872,824
  23.35%Consumer and other
  689,693
  18.39%
  686,064
  18.35%Agricultural
  242,962
  6.48%
  254,204
  6.80%Total loans
  3,750,323
  100.00%
  3,738,202
  100.00%Less
  allowance for loan losses
  (52,497)
  
  (52,168)Total
  $3,697,826
  
  $3,686,034Nonperforming Assets



At March 31, 2001,
nonperforming assets were $24.9 million, a decrease of $1.2 million or 4.6%
from the $26.1 million level at December 31, 2000. The decrease was principally
due to the charge off a $2.4 million non-performing asset which had been in the
Companys loan portfolio since December 1997, when the bank originating the
asset was acquired.  At March 31, 2001,
nonperforming loans as a percent of total loans were .61%, down from the
December 31, 2000 level of .63%.  OREO
was $2.2 million at March 31, 2001, a decrease of $270,000 from $2.4 million at
December 31, 2000.



Nonperforming assets of the Company
are summarized in the following table:






Loans
  March 31, 2001
  December 31, 2000Nonaccrual loans
  $22,500
  $23,426Restructured loans
  221
  224Nonperforming loans
  22,721
  23,650Other real estate owned
  2,167
  2,437Nonperforming
  assets
  $24,888
  $26,087Loans
  90 days or more past due but still accruing
  $3,423
  $2,482Nonperforming
  loans as a percentage of total loans
  .61%
  .63%Nonperforming
  assets as a percentage of total assets
  .42%
  .43%Nonperforming
  assets as a percentage of loans and OREO
  .66%
  .70%Total Loans
  3,750,323
  3,738,202Total Assets
  5,967,917
  6,089,729


Allowance for Loan Losses


At
March 31, 2001 the allowance for loan losses was $52.5 million, an increase of
$1.7 million from the March 31, 2000 balance of $50.8 million.  Net charge-offs during the three months
ended March 31, 2001 were $2.3 million more than those incurred during the
three months ended March 31, 2000, principally as a result of the Companys
decision to charge-off the Companys single largest non-performing asset, a
$2.4 million credit facility at one of its Arizona offices, a credit facility
which was outstanding at the time the bank was acquired by the Company in
December 1997.

At March 31, 2001, and
December 31, 2000, the allowance for loan losses as a percentage of total loans
was 1.40%, an increase from the March 31, 2000 level of 1.38%.

The following table sets forth the
Companys allowance for loans losses:

March 31,(Dollars
  in thousands)
  2001
  2000Balance
  at beginning of period
  $52,168
  $48,878Charge-offs:Real estate
  208
  298Real estate construction
  2,438
  17Commercial
  1,469
  1,559Consumer and other
  2,314
  1,939Agricultural
  91
  92Total charge-offs
  6,520
  3,905Recoveries:Real estate
  26
  25Real estate construction
  1
  1Commercial
  205
  80Consumer and other
  877
  697Agricultural
  123
  66Total recoveries
  1,232
  869Net
  charge-offs
  5,288
  3,036Provision charged to operations
  5,617
  4,990Balance at end of period
  $52,497
  $50,832Allowance
  as a percentage of total loans
  1.40%
  1.38%Annualized
  net charge-offs to average loans outstanding
  0.57%
  0.33%Total
  Loans
  3,750,323
  3,687,553Average
  Loans
  3,738,045
  3,673,378Investments

The investment portfolio, including
available-for-sale securities and held-to-maturity securities, was $1.7 billion
at March 31, 2001, a decrease of $96.9 million, or 5.4% from $1.8 billion at
December 31, 2000.  At March 31, 2001,
the investment portfolio represented 28.3% of total assets, compared with 29.4%
at December 31, 2000.  In addition to
investment securities, the Company had investments in interest-bearing deposits
of $1.4 million at March 31, 2001, an increase of $320,000 from the $1.1
million at December 31, 2000.

Deposits

Total deposits were $4.9 billion at
March 31, 2001, a decrease of $92.4 million, or 1.8%, from $5.0 billion at
December 31, 2000.  Noninterest-bearing
deposits at March 31, 2001 were $462 million, a decrease of $39 million, or
7.8%, from $501 million at December 31, 2000. 
The Companys core deposits as a percent of total deposits were 83.9%
and 84.0% as of March 31, 2001 and December 31, 2000, respectively.  Interest-bearing deposits were $4.5 billion
at March 31, 2001, and December 31, 2000.

Borrowings

Short-term borrowings of the Company
were $126 million as of March 31, 2001, a decrease of $78 million, or 38.2%,
from $204 million as of December 31, 2000.

Long-term debt of the Company was $119
million as of March 31, 2001, a decrease of $5 million, or 4.0%, from the $124
million as of December 31, 2000.

Capital Management

Shareholders equity increased $5
million to $350 million at March 31, 2001 from $345 million at December 31,
2000.  At March 31, 2001, the Companys
Tier 1 capital, total risk-based capital and leverage ratios were 8.23%,
10.94%, and 6.04%, respectively, compared to minimum required levels of 4%, 8%
and 3%, respectively (subject to change and the discretion of regulatory
authorities to impose higher standards in individual cases).  At March 31, 2001, the Company had
risk-weighted assets of $4.3 billion.

Stock Repurchases

On April 10, 2000, the Company announced
its intention to repurchase up to 5 million shares of the Companys common
stock.  On August 9, 2000, the Company
announced its intention to repurchase up to an additional 5 million shares of
the Companys common stock.  As of May
8, 2001, the Company has repurchased 8,600,000 shares of common stock at prices
ranging from $15.25 to $19.92.

Item 3.  Quantitative and Qualitative Disclosure
About Market Risk



There have been no material changes in
market risk exposures that affect the quantitative and qualitative disclosures
presented as of December 31, 2000 in the Companys Form 10-K and Annual Report.

PART II
- OTHER INFORMATION



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

On
March 23, 2001, the Company submitted a current report on Form 8-K that
reported a restructuring charge related to the closing of certain bank
locations and the write-off of a non-performing loan.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.



COMMUNITY FIRST BANKSHARES, INC.Date: 
  May 8, 2001
  /s/ Mark AndersonMark A. AndersonPresident and Chief Executive OfficerDate: 
  May 8, 2001
  /s/ Craig A. WeissCraig A. WeissChief Financial Officer