|   | UNITED STATES |
|--------|---------------|

|   | SECURITIES AND EXCHANGE COMMISSION |
|--------|------------------------------------|

| x | QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|------------------------------------------------------------------------------------|

| FOR THE QUARTERLY PERIOD ENDED: | March 31, 2011            |
|---------------------------------|---------------------------|
|                            | ------------------------- |

| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|-------------------------------------------------------------------------------------------|

| COMMISSION FILE NUMBER: | 000-50224          |
|-------------------------|--------------------|
|                    | ------------------ |

| MISSISSIPPI                                              | 64-0681198                                                 |
|----------------------------------------------------------|------------------------------------------------------------|
|  (STATE OF INCORPORATION)                           | (I. R. S. EMPLOYER IDENTIFICATION NO.)                     |
|                                                     |                                                       |
| 295 HIGHWAY 6 WEST/ P. O. BOX 690                        |                                                       |
| BATESVILLE, MISSISSIPPI                                  | 38606                                                      |
| -------------------------------------------------------- | ---------------------------------------------------------- |
| (ADDRESS OF PRINCIPAL                                    | (ZIP CODE)                                                 |
| EXECUTIVE OFFICES)                                       |                                                       |

----

| TITLE                         | OUTSTANDING |
|-------------------------------|-------------|
| COMMON STOCK, $5.00 PAR VALUE | 2,883,209   |

----

| TABLE OF CONTENTS |
|-------------------|
|              |   |   |
| PART I.           | FINANCIAL INFORMATION |   |
|              |   |   |
| Item 1.           | Consolidated Financial Statements |   |
|              |   |   |
|              | Consolidated Balance Sheets |   |
|              | March 31, 2011 (unaudited) and December 31, 2010 |   |
|              |   |   |
|              | Consolidated Statements of Income |   |
|              | Three months ended March 31, 2011 and 2010 (unaudited) |   |
|              |   |   |
|              | Consolidated Statements of Comprehensive Income |   |
|              | Three months ended March 31, 2011 and 2010 (unaudited) |   |
|              |   |   |
|              | Consolidated Statements of Cash Flows |   |
|              | Three months ended March 31, 2011 and 2010 (unaudited) |   |
|              |   |   |
|              | Notes to Consolidated Financial Statements (unaudited) |   |
|              |   |   |
| Item 2.           | Management’s Discussion and Analysis of Financial Condition and Results of Operations |   |
|              |   |   |
| Item 3.           | Quantitative and Qualitative Disclosures about Market Risk |   |
|              |   |   |
| Item 4.           | Controls and Procedures |   |
|              |   |   |
|              |   |   |
| PART II.          | OTHER INFORMATION |   |
|              |   |   |
| Item 1.           | Legal Proceedings |   |
|              |   |   |
| Item 1A.          | Risk Factors |   |
|              |   |   |
| Item 2.           | Changes in Securities |   |
|              |   |   |
| 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 |   |

| ITEM NO. 1 | CONSOLIDATED FINANCIAL STATEMENTS |
|------------|-----------------------------------|

----

| SECURITY CAPITAL CORPORATION                                        |   |
|---------------------------------------------------------------------|--------|
| CONSOLIDATED BALANCE SHEETS                                         |   |
| (dollar amounts presented in thousands)                             |   |
|                                                                |   | (Unaudited) |   |   |   |   |
|                                                                |   | Mar. 31, |   |   | Dec. 31, |   |
|                                                                |   | 2011 |   |   | 2010 |   |
| ASSETS                                                              |   |   |   |   |   |   |
| Cash and due from banks                                             |   | $ | 16,523 |   |   | $ | 14,822 |   |
| Interest-bearing deposits with banks                                |   |   | 955 |   |   |   | 442 |   |
|    Total cash and cash equivalents                   |   |   | 17,478 |   |   |   | 15,264 |   |
| Federal funds sold                                                  |   |   | 38,270 |   |   |   | 31,270 |   |
| Certificates of deposit with other banks                            |   |   | 1,538 |   |   |   | 1,778 |   |
| Securities available-for-sale                                       |   |   | 131,353 |   |   |   | 124,447 |   |
| Securities held-to-maturity, estimated fair value of                |   |   | 43,667 |   |   |   | 33,095 |   |
|    $43,379 in 2011 and $32,541 in 2010               |   |   |   |   |   |   |   |   |
| Securities, other                                                   |   |   | 1,933 |   |   |   | 1,933 |   |
|    Total securities                                  |   |   | 176,953 |   |   |   | 159,475 |   |
| Loans, less allowance for loan losses of                            |   |   |   |   |   |   |   |   |
|    $4,809 in 2011 and $4,477 in 2010                 |   |   | 241,751 |   |   |   | 243,287 |   |
| Interest receivable                                                 |   |   | 3,038 |   |   |   | 2,902 |   |
| Premises and equipment                                              |   |   | 22,679 |   |   |   | 22,922 |   |
| Other real estate                                                   |   |   | 19,809 |   |   |   | 20,272 |   |
| Intangible assets                                                   |   |   | 3,874 |   |   |   | 3,874 |   |
| Cash surrender value of life insurance                              |   |   | 6,716 |   |   |   | 6,650 |   |
| Customers' liability acceptances                                    |   |   | 1,126 |   |   |   | 1,142 |   |
| Other assets                                                        |   |   | 3,260 |   |   |   | 3,646 |   |
| Total Assets                                                        |   | $ | 536,492 |   |   | $ | 512,482 |   |
| LIABILITIES AND SHAREHOLDERS' EQUITY                                |   |   |   |   |   |   |   |   |
| Liabilities:                                                        |   |   |   |   |   |   |   |   |
|    Noninterest-bearing deposits                      |   | $ | 77,616 |   |   | $ | 74,022 |   |
|    Time deposits of $100,000 or more                 |   |   | 75,639 |   |   |   | 80,885 |   |
|    Other interest-bearing deposits                   |   |   | 279,826 |   |   |   | 253,836 |   |
|       Total deposits                  |   |   | 433,081 |   |   |   | 408,743 |   |
|    Interest payable                                  |   |   | 267 |   |   |   | 419 |   |
|    Acceptances outstanding                           |   |   | 1,126 |   |   |   | 1,142 |   |
|    Borrowed funds                                    |   |   | 25,290 |   |   |   | 26,970 |   |
|    Other liabilities                                 |   |   | 3,997 |   |   |   | 3,295 |   |
| Total Liabilities                                                   |   |   | 463,761 |   |   |   | 440,569 |   |
|                                                                |   |   |   |   |   |   |   |   |
| Shareholders' equity:                                               |   |   |   |   |   |   |   |   |
|    Preferred stock - $1,000 par value, 25,000 shares |   |   |   |   |   |   |   |   |
|    authorized, 17,910 shares issued                  |   |   | 17,805 |   |   |   | 17,742 |   |
|    Common stock - $5 par value, 10,000,000 shares    |   |   |   |   |   |   |   |   |
|    authorized, 2,890,811 shares issued               |   |   | 14,454 |   |   |   | 14,454 |   |
| Surplus                                                             |   |   | 38,518 |   |   |   | 40,733 |   |
| Retained earnings (deficit)                                         |   |   | 461 |   |   |   | (2,214 | ) |
| Accumulated other comprehensive income                              |   |   | 1,531 |   |   |   | 1,236 |   |
| Treasury stock, at par, 7,602 shares                                |   |   | (38 | ) |   |   | (38 | ) |
| Total Shareholders' Equity                                          |   |   | 72,731 |   |   |   | 71,913 |   |
| Total Liabilities and Shareholders' Equity                          |   | $ | 536,492 |   |   | $ | 512,482 |   |

----

| SECURITY CAPITAL CORPORATION                      |   |
|---------------------------------------------------|--------|
| CONSOLIDATED STATEMENTS OF INCOME                 |   |
| (dollar amounts presented in thousands)           |   |
|                                              |   | (Unaudited) |   |
|                                              |   | For the three months |   |
|                                              |   | ended March 31, |   |
|                                              |   | 2011 |   |   | 2010 |   |
| INTEREST INCOME                                   |   |   |   |   |   |   |
| Interest and fees on loans                        |   | $ | 3,468 |   |   | $ | 3,701 |   |
| Interest and dividends on securities              |   |   | 1,148 |   |   |   | 1,135 |   |
| Federal funds sold                                |   |   | 18 |   |   |   | 10 |   |
| Other                                             |   |   | 1 |   |   |   | 27 |   |
|    Total interest income           |   |   | 4,635 |   |   |   | 4,873 |   |
|                                              |   |   |   |   |   |   |   |   |
| INTEREST EXPENSE                                  |   |   |   |   |   |   |   |   |
| Interest on deposits                              |   |   | 604 |   |   |   | 862 |   |
| Interest on borrowings                            |   |   | 175 |   |   |   | 189 |   |
|     Total interest expense    |   |   | 779 |   |   |   | 1,051 |   |
|                                              |   |   |   |   |   |   |   |   |
| Net Interest Income                               |   |   | 3,856 |   |   |   | 3,822 |   |
|                                              |   |   |   |   |   |   |   |   |
| Provision for loan losses                         |   |   | 430 |   |   |   | 276 |   |
| Net interest income after provision               |   |   |   |   |   |   |   |   |
|   for loan losses                       |   |   | 3,426 |   |   |   | 3,546 |   |
|                                              |   |   |   |   |   |   |   |   |
| OTHER INCOME                                      |   |   |   |   |   |   |   |   |
| Service charges on deposit accounts               |   |   | 971 |   |   |   | 1,044 |   |
| Trust Department income                           |   |   | 224 |   |   |   | 231 |   |
| Other income                                      |   |   | 399 |   |   |   | 219 |   |
|    Total other income              |   |   | 1,594 |   |   |   | 1,494 |   |
|                                              |   |   |   |   |   |   |   |   |
| OTHER EXPENSES                                    |   |   |   |   |   |   |   |   |
| Salaries and employee benefits                    |   |   | 2,519 |   |   |   | 2,623 |   |
| Occupancy expense                                 |   |   | 563 |   |   |   | 603 |   |
| Other operating expense                           |   |   | 1,346 |   |   |   | 1,188 |   |
|    Total other expenses            |   |   | 4,428 |   |   |   | 4,414 |   |
|                                              |   |   |   |   |   |   |   |   |
| INCOME BEFORE PROVISION                           |   |   |   |   |   |   |   |   |
|    FOR INCOME TAXES                |   |   | 592 |   |   |   | 626 |   |
|                                              |   |   |   |   |   |   |   |   |
| PROVISION (BENEFIT) FOR INCOME TAXES              |   |   | (36 | ) |   |   | 11 |   |
|                                              |   |   |   |   |   |   |   |   |
| NET INCOME                                        |   |   | 628 |   |   |   | 615 |   |
| Preferred Dividends                               |   |   | (167 | ) |   |   | (289 | ) |
|                                              |   |   |   |   |   |   |   |   |
| NET INCOME APPLICABLE TO                          |   |   |   |   |   |   |   |   |
|      COMMON SHAREHOLDERS |   | $ | 461 |   |   | $ | 326 |   |
|                                              |   |   |   |   |   |   |   |   |
| BASIC NET INCOME PER COMMON SHARE                 |   | $ | 0.16 |   |   | $ | 0.11 |   |
|                                              |   |   |   |   |   |   |   |   |

----

|                                                |                 |   |   |   |   |   |
|-----------------------------------------------------|----------------------|--------|--------|--------|--------|--------|
| SECURITY CAPITAL CORPORATION                        |
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME     |
| (dollar amounts presented in thousands)             |
|                                                |                 |   |   |   |   |   |
|                                                | (Unaudited)          |
|                                                | For the three months |
|                                                | ended March 31,      |
|                                                |                 | 2011   |   |   | 2010   |   |
|                                                |                 |   |   |   |   |   |
| Net income                                          |                 | $      | 628    |   |   | $      | 615 |   |
|                                                |                 |   |   |   |   |   |   |   |
| Other comprehensive income, net of tax:             |                 |   |   |   |   |   |   |   |
|                                                |                 |   |   |   |   |   |   |   |
|    Unrealized holding gains/(losses) |                 |   | 295    |   |   |   | 585 |   |
|                                                |                 |   |   |   |   |   |   |   |
| Comprehensive Income                                |                 | $      | 923    |   |   | $      | 1,200 |   |
|                                                |                 |   |   |   |   |   |   |   |

----

| SECURITY CAPITAL CORPORATION                                                             |   |
|------------------------------------------------------------------------------------------|--------|
| CONSOLIDATED STATEMENTS OF CASH FLOWS                                                    |   |
| (dollar amounts presented in thousands)                                                  |   |
|                                                                                     |   | (Unaudited) |   |
|                                                                                     |   | Three months ended |   |
|                                                                                     |   | March 31, |   |
|                                                                                     |   | 2011 |   |   | 2010 |   |
|                                                                                     |   |   |   |   |   |   |
|  CASH FLOWS FROM OPERATING ACTIVITIES:                                              |   |   |   |   |   |   |
|  NET INCOME                                                                         |   | $ | 628 |   |   | $ | 615 |   |
|  Adjustments to reconcile net income to                                             |   |   |   |   |   |   |   |   |
|     net cash provided by operating activities:                       |   |   |   |   |   |   |   |   |
|     Provision for loan losses                                        |   |   | 430 |   |   |   | 276 |   |
|     Amortization of premiums and discounts on securities, net        |   |   | 429 |   |   |   | 379 |   |
|     Depreciation and amortization                                    |   |   | 302 |   |   |   | 305 |   |
|     FHLB stock dividend                                              |   |   | (1 | ) |   |   | (2 | ) |
|     (Gain) loss on sale/disposal of other assets, net                |   |   | (34 | ) |   |   | (18 | ) |
|  Changes in:                                                                        |   |   |   |   |   |   |   |   |
|     Interest receivable                                              |   |   | (136 | ) |   |   | 81 |   |
|     Cash value of life insurance, net                                |   |   | (66 | ) |   |   | (56 | ) |
|     Other assets                                                     |   |   | 436 |   |   |   | (55 | ) |
|     Interest payable                                                 |   |   | (152 | ) |   |   | (112 | ) |
|     Other liabilities                                                |   |   | 496 |   |   |   | 832 |   |
|  Net cash provided by operating activities                                          |   |   | 2,332 |   |   |   | 2,245 |   |
|                                                                                     |   |   |   |   |   |   |   |   |
|  CASH FLOWS FROM INVESTING ACTIVITIES                                               |   |   |   |   |   |   |   |   |
|  Purchase of securities available-for-sale                                          |   |   | (12,626 | ) |   |   | (32,161 | ) |
|  Proceeds of maturities and calls of securities available-for-sale                  |   |   | 5,847 |   |   |   | 11,962 |   |
|  Purchase of securities held-to-maturity                                            |   |   | (13,278 | ) |   |   | - |   |
|  Proceeds of maturities and calls of securities held-to-maturity                    |   |   | 2,620 |   |   |   | 245 |   |
|  Additions to premises and equipment                                                |   |   | (27 | ) |   |   | (8 | ) |
|  Proceeds from sale of other assets                                                 |   |   | 808 |   |   |   | 464 |   |
|  Changes in:                                                                        |   |   |   |   |   |   |   |   |
|     Loans                                                            |   |   | 730 |   |   |   | 3,055 |   |
|     Federal funds sold                                               |   |   | (7,000 | ) |   |   | (17,450 | ) |
|  Certificates of deposits with other banks                                          |   |   | 240 |   |   |   | - |   |
|  Net cash used in investing activities                                              |   |   | (22,686 | ) |   |   | (33,893 | ) |
|                                                                                     |   |   |   |   |   |   |   |   |
|  CASH FLOWS FROM FINANCING ACTIVITIES                                               |   |   |   |   |   |   |   |   |
|  Dividends paid on preferred stock                                                  |   |   | (90 | ) |   |   | (229 | ) |
|  Changes in:                                                                        |   |   |   |   |   |   |   |   |
|     Deposits                                                         |   |   | 24,338 |   |   |   | 33,474 |   |
|  Repayment of debt                                                                  |   |   | (2,044 | ) |   |   | (2,194 | ) |
|  Proceeds from issuance of debt                                                     |   |   | 364 |   |   |   | 382 |   |
|  Net cash provided by financing activities                                          |   |   | 22,568 |   |   |   | 31,433 |   |
|                                                                                     |   |   |   |   |   |   |   |   |
|  Net increase (decrease) in cash and cash equivalents                               |   |   | 2,214 |   |   |   | (215 | ) |
|                                                                                     |   |   |   |   |   |   |   |   |
|  Cash and cash equivalents at beginning of period                                   |   |   | 15,264 |   |   |   | 17,045 |   |
|                                                                                     |   |   |   |   |   |   |   |   |
|  Cash and cash equivalents at end of period                                         |   | $ | 17,478 |   |   | $ | 16,830 |   |
|                                                                                     |   |   |   |   |   |   |   |   |
|  Supplemental Disclosures of Cash Flow Information                                  |   |   |   |   |   |   |   |   |
|                                                                                     |   |   |   |   |   |   |   |   |
|  Cash paid during the period for:                                                   |   |   |   |   |   |   |   |   |
|     Interest                                                         |   | $ | 931 |   |   | $ | 1,163 |   |
|     Income taxes                                                     |   |   | - |   |   |   | - |   |
|                                                                                     |   |   |   |   |   |   |   |   |
|  Non-cash activities:                                                               |   |   |   |   |   |   |   |   |
|     Transfer of loans to other real estate and repossessed inventory |   | $ | 422 |   |   | $ | 723 |   |
|                                                                                     |   |   |   |   |   |   |   |   |

----

----

| Securities                                                                 |   |
|----------------------------------------------------------------------------|--------|
| Amortized Cost and Fair Values                                             |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                       |   |   |   |   | Gross |   |   | Gross |   |   |   |   |
|                                                                       |   | Amortized |   |   | Unrealized |   |   | Unrealized |   |   | Estimated |   |
|                                                                       |   | Cost |   |   | Gains |   |   | Losses |   |   | Fair Value |   |
|                                                                       |   | (In thousands) |   |
| March 31, 2011                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
|    Securities available-for-sale:                           |   |   |   |   |   |   |   |   |   |   |   |   |
| U. S. Government agencies                                                  |   | $ | 27,659 |   |   | $ | 43 |   |   | $ | 100 |   |   | $ | 27,602 |   |
| Mortgage-backed securities                                                 |   |   | 40,615 |   |   |   | 1,629 |   |   |   | 64 |   |   |   | 42,180 |   |
| State and local political subdivisions                                     |   |   | 60,635 |   |   |   | 1,190 |   |   |   | 269 |   |   |   | 61,556 |   |
| Other equity securities                                                    |   |   | 4 |   |   |   | 11 |   |   |   | - |   |   |   | 15 |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                       |   | $ | 128,913 |   |   | $ | 2,873 |   |   | $ | 433 |   |   | $ | 131,353 |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Securities held-to-maturity:                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       U. S. Government agencies              |   | $ | 35,221 |   |   | $ | 17 |   |   | $ | 421 |   |   | $ | 34,817 |   |
|       State and local political subdivisions |   |   | 8,446 |   |   |   | 119 |   |   |   | 3 |   |   |   | 8,562 |   |
|                                                                       |   | $ | 43,667 |   |   | $ | 136 |   |   | $ | 424 |   |   | $ | 43,379 |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31, 2010                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Securities available-for-sale:                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       U. S. Government agencies              |   | $ | 21,242 |   |   | $ | 51 |   |   | $ | 143 |   |   | $ | 21,150 |   |
|       Mortgage-backed securities             |   |   | 41,733 |   |   |   | 1,688 |   |   |   | 112 |   |   |   | 43,309 |   |
|       State and local political subdivisions |   |   | 59,497 |   |   |   | 929 |   |   |   | 451 |   |   |   | 59,975 |   |
|       Other equity securities                |   |   | 4 |   |   |   | 9 |   |   |   | - |   |   |   | 13 |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                       |   | $ | 122,476 |   |   | $ | 2,677 |   |   | $ | 706 |   |   | $ | 124,447 |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Securities held-to-maturity:                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       U. S. Government agencies              |   | $ | 25,578 |   |   | $ | 5 |   |   | $ | 600 |   |   | $ | 24,983 |   |
|       State and local political subdivisions |   |   | 7,517 |   |   |   | 84 |   |   |   | 43 |   |   |   | 7,558 |   |
|                                                                       |   | $ | 33,095 |   |   | $ | 89 |   |   | $ | 643 |   |   | $ | 32,541 |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| Securities                                |   |
|-------------------------------------------|--------|
| Unrealized Losses < and > 12 Months |   |
|                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Available-for-Sale                        |   |
|                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                      |   | Losses < 12 Months |   |   | Losses 12 Months or > |   |   | Total |   |
|                                      |   |   |   |   | Gross |   |   |   |   |   | Gross |   |   |   |   |   | Gross |   |
|                                      |   | Fair |   |   | Unrealized |   |   | Fair |   |   | Unrealized |   |   | Fair |   |   | Unrealized |   |
|                                      |   | Value |   |   | Losses |   |   | Value |   |   | Losses |   |   | Value |   |   | Losses |   |
| March 31, 2011                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U. S. Government                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    agencies                |   | $ | 17,217 |   |   | $ | 101 |   |   | $ | - |   |   | $ | - |   |   | $ | 17,217 |   |   | $ | 101 |   |
| Mortgage-backed                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| securities                                |   |   | 11,830 |   |   |   | 63 |   |   |   | - |   |   |   | - |   |   |   | 11,830 |   |   |   | 63 |   |
| State and local political                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| subdivisions                              |   |   | 9,619 |   |   |   | 199 |   |   |   | 1,717 |   |   |   | 70 |   |   |   | 11,336 |   |   |   | 269 |   |
|                                      |   | $ | 38,666 |   |   | $ | 363 |   |   | $ | 1,717 |   |   | $ | 70 |   |   | $ | 40,383 |   |   | $ | 433 |   |
|                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31, 2010                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U. S. Government                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    agencies                |   | $ | 8,924 |   |   | $ | 143 |   |   | $ | - |   |   | $ | - |   |   | $ | 8,924 |   |   | $ | 143 |   |
| Mortgage-backed                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    securities              |   |   | 11,524 |   |   |   | 112 |   |   |   | - |   |   |   | - |   |   |   | 11,524 |   |   |   | 112 |   |
| State and local political                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    subdivisions            |   |   | 17,202 |   |   |   | 369 |   |   |   | 1,236 |   |   |   | 82 |   |   |   | 18,438 |   |   |   | 451 |   |
|                                      |   | $ | 37,650 |   |   | $ | 624 |   |   | $ | 1,236 |   |   | $ | 82 |   |   | $ | 38,886 |   |   | $ | 706 |   |
|                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Held-to-Maturity                          |   |
|                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                      |   | Losses < 12 Months |   |   | Losses 12 Months or > |   |   | Total |   |
|                                      |   |   |   |   |   | Gross |   |   |   |   |   |   | Gross |   |   |   |   |   |   | Gross |   |
|                                      |   | Fair |   |   | Unrealized |   |   | Fair |   |   | Unrealized |   |   | Fair |   |   | Unrealized |   |
|                                      |   | Value |   |   | Losses |   |   | Value |   |   | Losses |   |   | Value |   |   | Losses |   |
| March 31, 2011                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U. S. Government                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    agencies                |   | $ | 29,786 |   |   | $ | 421 |   |   | $ | - |   |   | $ | - |   |   | $ | 29,786 |   |   | $ | 421 |   |
| State and local political                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    subdivisions            |   |   | 503 |   |   |   | 3 |   |   |   | - |   |   |   | - |   |   |   | 503 |   |   |   | 3 |   |
|                                      |   | $ | 30,289 |   |   | $ | 424 |   |   | $ | - |   |   | $ | - |   |   | $ | 30,289 |   |   | $ | 424 |   |
|                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31, 2010                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U. S. Government                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    agencies                |   | $ | 19,675 |   |   | $ | 600 |   |   | $ | - |   |   | $ | - |   |   | $ | 19,675 |   |   | $ | 600 |   |
| State and local political                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    subdivisions            |   |   | 2,144 |   |   |   | 43 |   |   |   | - |   |   |   | - |   |   |   | 2,144 |   |   |   | 43 |   |
|                                      |   | $ | 21,819 |   |   | $ | 643 |   |   | $ | - |   |   | $ | - |   |   | $ | 21,819 |   |   | $ | 643 |   |
|                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| Loans                                           |   |
|-------------------------------------------------|--------|
| Major Classifications                           |   |
|                                            |   |   |   |   |   |   |
| Major classifications of loans were as follows: |   |   |   |   |   |   |
|                                            |   | March 31, |   |   | December 31, |   |
|                                            |   | 2011 |   |   | 2010 |   |
|                                            |   | (In thousands) |   |
|                                            |   |   |   |   |   |   |
| Commercial, financial and agricultural          |   | $ | 36,450 |   |   | $ | 33,347 |   |
| Real estate - construction and development      |   |   | 58,544 |   |   |   | 56,673 |   |
| Real estate - mortgage                          |   |   | 129,387 |   |   |   | 134,964 |   |
| Installment loans to individuals                |   |   | 20,793 |   |   |   | 20,186 |   |
| Other                                           |   |   | 1,386 |   |   |   | 2,594 |   |
|                                            |   |   | 246,560 |   |   |   | 247,764 |   |
| Less allowance for loan losses                  |   |   | (4,809 | ) |   |   | (4,477 | ) |
|                                            |   | $ | 241,751 |   |   | $ | 243,287 |   |
|                                            |   |   |   |   |   |   |   |   |

|                                                                     |   | Three Months Ended March 31, |   |
|--------------------------------------------------------------------------|--------|------------------------------|--------|
|                                                                     |   | 2011                         |   |   | 2010 |   |
|                                                                     |   | (In thousands)               |   |
| Balance at beginning of period                                           |   | $                            | 4,477  |   |   | $ | 4,352 |   |
|      Provision for loan losses                  |   |                         | 430    |   |   |   | 276 |   |
|      Loans charged-off                          |   |                         | (300   | ) |   |   | (711 | ) |
|      Recoveries on loans previously charged-off |   |                         | 202    |   |   |   | 226 |   |
| Balance at end of period                                                 |   | $                            | 4,809  |   |   | $ | 4,143 |   |
|                                                                     |   |                         |   |   |   |   |   |   |

----

| March 31, 2011                     |   |           |    |   |        |   |   |            |   |
|------------------------------------|--------|----------------|---------|--------|-------------|--------|--------|-----------------|--------|
|                               |   |           |    |   | Installment |   |   | Commercial,     |   |   |   |   |
|                               |   |           |    |   | and         |   |   | Financial       |   |   |   |   |
|                               |   | Real Estate    |    |   | Other       |   |   | and Agriculture |   |   | Total |   |
|                               |   | (In thousands) |    |
| Loans                              |   |           |    |   |        |   |   |            |   |   |   |   |
|   Individually evaluated |   | $              | 43,586  |   |        | $      | 28     |            |   | $ | 1,075 |   |   | $ | 44,689 |   |
|   Collectively evaluated |   |           | 144,345 |   |        |   | 22,151 |            |   |   | 35,375 |   |   |   | 201,871 |   |
| Total                              |   | $              | 187,931 |   |        | $      | 22,179 |            |   | $ | 36,450 |   |   | $ | 246,560 |   |
|                               |   |           |    |   |        |   |   |            |   |   |   |   |   |   |   |   |
| Allowance for Loan Losses          |   |           |    |   |        |   |   |            |   |   |   |   |   |   |   |   |
|   Individually evaluated |   | $              | 3,280   |   |        | $      | 1      |            |   | $ | 11 |   |   | $ | 3,292 |   |
|   Collectively evaluated |   |           | 1,076   |   |        |   | 235    |            |   |   | 206 |   |   |   | 1,517 |   |
| Total                              |   | $              | 4,356   |   |        | $      | 236    |            |   | $ | 217 |   |   | $ | 4,809 |   |
|                               |   |           |    |   |        |   |   |            |   |   |   |   |   |   |   |   |

| December 31, 2010                  |   |           |    |   |        |   |   |            |   |
|------------------------------------|--------|----------------|---------|--------|-------------|--------|--------|-----------------|--------|
|                               |   |           |    |   | Installment |   |   | Commercial,     |   |   |   |   |
|                               |   |           |    |   | and         |   |   | Financial       |   |   |   |   |
|                               |   | Real Estate    |    |   | Other       |   |   | and Agriculture |   |   | Total |   |
|                               |   | (In thousands) |    |
| Loans                              |   |           |    |   |        |   |   |            |   |   |   |   |
|   Individually evaluated |   | $              | 44,284  |   |        | $      | 28     |            |   | $ | 950 |   |   | $ | 45,262 |   |
|   Collectively evaluated |   |           | 147,359 |   |        |   | 22,752 |            |   |   | 32,391 |   |   |   | 202,502 |   |
| Total                              |   | $              | 191,643 |   |        | $      | 22,780 |            |   | $ | 33,341 |   |   | $ | 247,764 |   |
|                               |   |           |    |   |        |   |   |            |   |   |   |   |   |   |   |   |
| Allowance for Loan Losses          |   |           |    |   |        |   |   |            |   |   |   |   |   |   |   |   |
|   Individually evaluated |   | $              | 2,870   |   |        | $      | 1      |            |   | $ | 8 |   |   | $ | 2,879 |   |
|   Collectively evaluated |   |           | 1,136   |   |        |   | 215    |            |   |   | 247 |   |   |   | 1,598 |   |
| Total                              |   | $              | 4,006   |   |        | $      | 216    |            |   | $ | 255 |   |   | $ | 4,477 |   |
|                               |   |           |    |   |        |   |   |            |   |   |   |   |   |   |   |   |

----

|                                          |   | March 31,      |       |   | December 31, |   |
|-----------------------------------------------|--------|----------------|------------|--------|--------------|--------|
|                                          |   | 2011           |       |   | 2010         |   |
|                                          |   | (In thousands) |       |
| Loans analyzed for impairment                 |   |           |       |   |         |   |
|   without a valuation allowance     |   | $              | 25,464,559 |   |         | $      | 28,171,248 |   |
| Loans analyzed for impairment                 |   |           |       |   |         |   |   |   |
|   with a valuation allowance        |   |           | 19,224,857 |   |         |   | 17,090,793 |   |
| Total impaired loans                          |   | $              | 44,689,416 |   |         | $      | 45,262,041 |   |
| Valuation allowance related to impaired loans |   | $              | 3,292,000  |   |         | $      | 2,879,000 |   |
|                                          |   |           |       |   |         |   |   |   |
|                                          |   |           |       |   |         |   |   |   |

----

| March 31, 2011                           |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |
|------------------------------------------|--------|----------------|--------|--------|---------|--------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|
|                                     |   |           |   |   |    |   |   |      |   |   | Average    |   |   | Interest   |   |
|                                     |   |           |   |   |    |   |   |      |   |   | Recorded   |   |   | Income     |   |
|                                     |   | Recorded       |   |   | Unpaid  |   |   | Related   |   |   | Investment |   |   | Recognized |   |
|                                     |   | Investment     |   |   | Balance |   |   | Allowance |   |   | YTD        |   |   | YTD        |   |
|                                     |   | (In thousands) |   |
| Loans analyzed for                       |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |
|   impairment with              |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |
|   no related allowance:        |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |
| Commercial, financial, and agricultural  |   | $              | 772    |   |    | $      | 772    |      |   | $      | -          |   |   | $          | 761    |   |   | $ | 10 |   |
| Real estate-construction and development |   |           | 17,163 |   |    |   | 17,163 |      |   |   | -          |   |   |       | 17,262 |   |   |   | 171 |   |
| Real estate-mortgage                     |   |           | 7,530  |   |    |   | 7,530  |      |   |   | -          |   |   |       | 7,474  |   |   |   | 86 |   |
| Installment loans and other              |   |           | -      |   |    |   | -      |      |   |   | -          |   |   |       | -      |   |   |   | - |   |
| Total                                    |   | $              | 25,465 |   |    | $      | 25,465 |      |   | $      | -          |   |   | $          | 25,497 |   |   | $ | 267 |   |
| Loans analyzed for                       |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |   |   |   |   |   |
|   impairment with              |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |   |   |   |   |   |
|   a related allowance:         |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |   |   |   |   |   |
| Commercial, financial, and agricultural  |   | $              | 283    |   |    | $      | 303    |      |   | $      | 11         |   |   | $          | 319    |   |   | $ | 3 |   |
| Real estate-construction and development |   |           | 12,687 |   |    |   | 12,687 |      |   |   | 2,085      |   |   |       | 12,486 |   |   |   | 65 |   |
| Real estate-mortgage                     |   |           | 6,226  |   |    |   | 6,502  |      |   |   | 1,195      |   |   |       | 6,000  |   |   |   | 32 |   |
| Installment loans and other              |   |           | 28     |   |    |   | 28     |      |   |   | 1          |   |   |       | 28     |   |   |   | - |   |
| Total                                    |   | $              | 19,224 |   |    | $      | 19,520 |      |   | $      | 3,292      |   |   | $          | 18,833 |   |   | $ | 100 |   |
| Total loans analyzed for                 |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |   |   |   |   |   |
|    impairment:            |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |   |   |   |   |   |
| Commercial, financial, and agricultural  |   | $              | 1,055  |   |    | $      | 1,075  |      |   | $      | 11         |   |   | $          | 1,080  |   |   | $ | 13 |   |
| Real estate-construction and development |   |           | 29,850 |   |    |   | 29,850 |      |   |   | 2,085      |   |   |       | 29,748 |   |   |   | 236 |   |
| Real estate-mortgage                     |   |           | 13,756 |   |    |   | 14,032 |      |   |   | 1,195      |   |   |       | 13,474 |   |   |   | 118 |   |
| Installment loans and other              |   |           | 28     |   |    |   | 28     |      |   |   | 1          |   |   |       | 28     |   |   |   | - |   |
| Total Impaired Loans                     |   | $              | 44,689 |   |    | $      | 44,985 |      |   | $      | 3,292      |   |   | $          | 44,330 |   |   | $ | 367 |   |
|                                     |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |   |   |   |   |   |

----

| December 31, 2010                                              |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |
|----------------------------------------------------------------|--------|----------------|--------|--------|---------|--------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|
|                                                           |   |           |   |   |    |   |   |      |   |   | Average    |   |   | Interest   |   |
|                                                           |   |           |   |   |    |   |   |      |   |   | Recorded   |   |   | Income     |   |
|                                                           |   | Recorded       |   |   | Unpaid  |   |   | Related   |   |   | Investment |   |   | Recognized |   |
|                                                           |   | Investment     |   |   | Balance |   |   | Allowance |   |   | YTD        |   |   | YTD        |   |
|                                                           |   | (In thousands) |   |
| Impaired loans with                                            |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |
|   no related allowance:                              |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |
| Commercial, financial, and    agricultural |   | $              | 623    |   |    | $      | 623    |      |   | $      | -          |   |   | $          | 580    |   |   | $ | 29 |   |
| Real estate-construction and development                       |   | $              | 17,886 |   |    | $      | 17,886 |      |   |   | -          |   |   |       | 20,360 |   |   |   | 762 |   |
| Real estate-mortgage                                           |   | $              | 9,662  |   |    | $      | 9,662  |      |   |   | -          |   |   |       | 9,759  |   |   |   | 377 |   |
| Installment loans and other                                    |   | $              | -      |   |    | $      | -      |      |   |   | -          |   |   |       | -      |   |   |   | - |   |
| Total                                                          |   | $              | 28,171 |   |    | $      | 28,171 |      |   |   |       |   |   | $          | 30,699 |   |   | $ | 1,168 |   |
| Impaired loans with                                            |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |   |   |   |   |   |
|   a related allowance:                               |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |   |   |   |   |   |
| Commercial, financial, and  agricultural             |   | $              | 327    |   |    | $      | 347    |      |   | $      | 8          |   |   | $          | 338    |   |   | $ | 12 |   |
| Real estate-construction and development                       |   | $              | 12,030 |   |    | $      | 12,030 |      |   |   | 1,667      |   |   |       | 10,788 |   |   |   | 364 |   |
| Real estate-mortgage                                           |   | $              | 4,706  |   |    | $      | 4,982  |      |   |   | 1,203      |   |   |       | 4,784  |   |   |   | 192 |   |
| Installment loans and other                                    |   | $              | 28     |   |    | $      | 28     |      |   |   | 1          |   |   |       | 31     |   |   |   | 1 |   |
| Total                                                          |   | $              | 17,091 |   |    | $      | 17,387 |      |   | $      | 2,879      |   |   | $          | 15,941 |   |   | $ | 569 |   |
| Total Impaired Loans                                           |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |   |   |   |   |   |
| Commercial, financial, and agricultural                        |   | $              | 950    |   |    | $      | 970    |      |   | $      | 8          |   |   | $          | 918    |   |   | $ | 41 |   |
| Real estate-construction and development                       |   |           | 29,916 |   |    |   | 29,916 |      |   |   | 1,667      |   |   |       | 31,148 |   |   |   | 1,126 |   |
| Real estate-mortgage                                           |   |           | 14,368 |   |    |   | 14,644 |      |   |   | 1,203      |   |   |       | 14,543 |   |   |   | 569 |   |
| Installment loans and other                                    |   |           | 28     |   |    |   | 28     |      |   |   | 1          |   |   |       | 31     |   |   |   | 1 |   |
| Total Impaired Loans                                           |   | $              | 45,262 |   |    | $      | 45,558 |      |   | $      | 2,879      |   |   | $          | 46,640 |   |   | $ | 1,737 |   |
|                                                           |   |           |   |   |    |   |   |      |   |   |       |   |   |       |   |   |   |   |   |   |

----

| March 31, 2011                     |   |           |   |   |      |     |   |        |   |   |     |   |   |   |   |
|------------------------------------|--------|----------------|--------|--------|-----------|----------|--------|-------------|--------|--------|----------|--------|--------|--------|--------|
|                               |   |           |   |   | 90 Days + |     |   |        |   |   |     |   |   |   |   |
|                               |   |           | 30-89  |   |      | Past Due |   |        |   |   |     |   |   |   |   |   |
|                               |   | Days Past      |   |   | and Still |     |   | Non-Accrual |   |   | Total    |   |   | Total  |   |
|                               |   | Due            |   |   | Accruing  |     |   | Loans       |   |   | Past Due |   |   | Loans  |   |
|                               |   | (In thousands) |   |   |      |     |   |        |   |   |     |   |
|                               |   |           |   |   |      |     |   |        |   |   |     |   |   |   |   |   |
| Commercial, financial              |   | $              | 762    |   |      | $        | -      |        |   | $      | 276      |   |   | $      | 1,038  |   |   | $ | 36,450 |   |
|    and agricultural |   |           |   |   |      |     |   |        |   |   |     |   |   |   |   |   |   |   |   |   |
| Real estate - construction         |   |           |   |   |      |     |   |        |   |   |     |   |   |   |   |   |   |   |   |   |
|    and development  |   |           | 722    |   |      |     | -      |        |   |   | 4,626    |   |   |   | 5,348  |   |   |   | 58,544 |   |
| Real estate - mortgage             |   |           | 3,247  |   |      |     | -      |        |   |   | 4,633    |   |   |   | 7,880  |   |   |   | 129,387 |   |
| Installment loans to individuals   |   |           | 688    |   |      |     | -      |        |   |   | 87       |   |   |   | 775    |   |   |   | 20,793 |   |
| Other                              |   |           | 14     |   |      |     | 1      |        |   |   | -        |   |   |   | 15     |   |   |   | 1,386 |   |
| Total                              |   | $              | 5,433  |   |      | $        | 1      |        |   | $      | 9,622    |   |   | $      | 15,056 |   |   | $ | 246,560 |   |
|                               |   |           |   |   |      |     |   |        |   |   |     |   |   |   |   |   |   |   |   |   |

| December 31, 2010                  |   |           |   |   |      |     |   |        |   |   |     |   |   |   |   |
|------------------------------------|--------|----------------|--------|--------|-----------|----------|--------|-------------|--------|--------|----------|--------|--------|--------|--------|
|                               |   |           |   |   | 90 Days + |     |   |        |   |   |     |   |   |   |   |
|                               |   |           | 30-89  |   |      | Past Due |   |        |   |   |     |   |   |   |   |   |
|                               |   | Days Past      |   |   | and Still |     |   | Non-Accrual |   |   | Total    |   |   | Total  |   |
|                               |   | Due            |   |   | Accruing  |     |   | Loans       |   |   | Past Due |   |   | Loans  |   |
|                               |   | (In thousands) |   |   |      |     |   |        |   |   |     |   |
|                               |   |           |   |   |      |     |   |        |   |   |     |   |   |   |   |   |
| Commercial, financial              |   | $              | 238    |   |      | $        | 29     |        |   | $      | 326      |   |   | $      | 593    |   |   | $ | 33,347 |   |
|    and agricultural |   |           |   |   |      |     |   |        |   |   |     |   |   |   |   |   |   |   |   |   |
| Real estate - construction         |   |           |   |   |      |     |   |        |   |   |     |   |   |   |   |   |   |   |   |   |
|    and development  |   |           | 1,016  |   |      |     | -      |        |   |   | 3,856    |   |   |   | 4,872  |   |   |   | 56,673 |   |
| Real estate - mortgage             |   |           | 2,070  |   |      |     | -      |        |   |   | 5,237    |   |   |   | 7,307  |   |   |   | 134,964 |   |
| Installment loans to individuals   |   |           | 842    |   |      |     | -      |        |   |   | 165      |   |   |   | 1,007  |   |   |   | 20,186 |   |
| Other                              |   |           | 67     |   |      |     | 34     |        |   |   | -        |   |   |   | 101    |   |   |   | 2,594 |   |
| Total                              |   | $              | 4,233  |   |      | $        | 63     |        |   | $      | 9,584    |   |   | $      | 13,880 |   |   | $ | 247,764 |   |
|                               |   |           |   |   |      |     |   |        |   |   |     |   |   |   |   |   |   |   |   |   |

----

| March 31, 2011                      |   |             |   |   |        |   |    |        |   |
|-------------------------------------|--------|------------------|--------|--------|-------------|--------|---------|-------------|--------|
|                                |   | Real Estate      |   |   |        |   |    | Installment |   |   |   |   |   |   |   |
|                                |   | Commercial & |   |   | Real Estate |   |    | and         |   |   | Financial |   |   |   |   |
|                                |   | Development      |   |   | Mortgage    |   |    | Other       |   |   | and Agriculture |   |   | Total |   |
|                                |   | (In thousands)   |   |
| Pass                                |   | $                | 16,181 |   |        | $      | 101,386 |        |   | $ | 21,071 |   |   | $ | 27,229 |   |   | $ | 165,867 |   |
| Special Mention                     |   |             | 11,742 |   |        |   | 11,131  |        |   |   | 614 |   |   |   | 7,653 |   |   |   | 31,140 |   |
| Substandard                         |   |             | 30,621 |   |        |   | 16,876  |        |   |   | 494 |   |   |   | 1,570 |   |   |   | 49,561 |   |
| Doubtful                            |   |             | -      |   |        |   | -       |        |   |   | - |   |   |   | - |   |   |   | - |   |
|   Subtotal                |   |             | 58,544 |   |        |   | 129,393 |        |   |   | 22,179 |   |   |   | 36,452 |   |   |   | 246,568 |   |
| Less:  Unearned           |   |             |   |   |        |   |    |        |   |   |   |   |   |   |   |   |   |   |   |   |
|    Discount          |   |             | -      |   |        |   | 6       |        |   |   | - |   |   |   | 2 |   |   |   | 8 |   |
| Loans, net of                       |   |             |   |   |        |   |    |        |   |   |   |   |   |   |   |   |   |   |   |   |
|    unearned discount |   | $                | 58,544 |   |        | $      | 129,387 |        |   | $ | 22,179 |   |   | $ | 36,450 |   |   | $ | 246,560 |   |
|                                |   |             |   |   |        |   |    |        |   |   |   |   |   |   |   |   |   |   |   |   |

| December 31, 2010                   |   |             |   |   |        |   |    |        |   |   |            |   |   |   |   |
|-------------------------------------|--------|------------------|--------|--------|-------------|--------|---------|-------------|--------|--------|-----------------|--------|--------|--------|--------|
|                                |   |             |   |   |        |   |    |        |   |
|                                |   | Real Estate      |   |   |        |   |    | Installment |   |   | Commercial,     |   |   |   |   |
|                                |   | Commercial & |   |   | Real Estate |   |    | and         |   |   | Financial       |   |   |   |   |
|                                |   | Development      |   |   | Mortgage    |   |    | Other       |   |   | and Agriculture |   |   | Total  |   |
|                                |   | (In thousands)   |   |
| Pass                                |   | $                | 15,545 |   |        | $      | 107,179 |        |   | $      | 21,514          |   |   | $      | 24,098 |   |   | $ | 168,336 |   |
| Special Mention                     |   |             | 10,261 |   |        |   | 10,329  |        |   |   | 643             |   |   |   | 7,811  |   |   |   | 29,044 |   |
| Substandard                         |   |             | 30,867 |   |        |   | 17,456  |        |   |   | 623             |   |   |   | 1,443  |   |   |   | 50,389 |   |
| Doubtful                            |   |             | -      |   |        |   | -       |        |   |   | -               |   |   |   | -      |   |   |   | - |   |
|   Subtotal                |   |             | 56,673 |   |        |   | 134,964 |        |   |   | 22,780          |   |   |   | 33,352 |   |   |   | 247,769 |   |
| Less:  Unearned           |   |             |   |   |        |   |    |        |   |   |            |   |   |   |   |   |   |   |   |   |
|    Discount          |   |             | -      |   |        |   | -       |        |   |   | -               |   |   |   | 5      |   |   |   | 5 |   |
| Loans, net of                       |   |             |   |   |        |   |    |        |   |   |            |   |   |   |   |   |   |   |   |   |
|    unearned discount |   | $                | 56,673 |   |        | $      | 134,964 |        |   | $      | 22,780          |   |   | $      | 33,347 |   |   | $ | 247,764 |   |
|                                |   |             |   |   |        |   |    |        |   |   |            |   |   |   |   |   |   |   |   |   |

----

|   |   |
|--------|--------|

|            |   | For the Three Months Ended |    |
|-----------------|--------|----------------------------|---------|
|            |   | March 31, 2011             |    |
|            |   | Basic income               |    |   |   |   |   |   |   |
|            |   | applicable to              |    |   |   |   |   |   |   |
|            |   | common                     |    |   |   |   |   |   |   |
|            |   | shareholders               |    |   | Shares |   |   | Per Share |   |
|            |   | (Numerator)                |    |   | (Denominator) |   |   | Data |   |
|            |   |                       |    |   |   |   |   |   |   |
| Basic per Share |   | $                          | 461,265 |   |   |   | 2,883,209 |   |   | $ | 0.16 |   |
|            |   |                       |    |   |   |   |   |   |   |   |   |   |
|            |   | For the Three Months Ended |    |
|            |   | March 31, 2010             |    |
|            |   | Basic income               |    |   |   |   |   |   |   |   |   |
|            |   | applicable to              |    |   |   |   |   |   |   |   |   |
|            |   | common                     |    |   |   |   |   |   |   |   |   |
|            |   | shareholders               |    |   | Shares |   |   | Per Share |   |
|            |   | (Numerator)                |    |   | (Denominator) |   |   | Data |   |
|            |   |                       |    |   |   |   |   |   |   |   |   |   |
| Basic per Share |   | $                          | 326,518 |   |   |   | 2,883,159 |   |   | $ | 0.11 |   |
|            |   |                       |    |   |   |   |   |   |   |   |   |   |

|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | Level 1 | Valuations for assets and liabilities traded in active exchange markets, such as the New York Stock Exchange. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities.                                                                                                                                                                                                                                                                     |
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|   | Level 2 | Valuations for assets and liabilities traded in less active dealer or broker markets. Valuations are obtained from third party pricing services for identical or comparable assets or liabilities which use observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets and liabilities. |
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|   | Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.                                                                                                                                                                                                                                                                                                                                                                     |

----

|                                                     |   | Quoted    |   |   | Models with |   |    |   |   |   | Models with  |         |   | Carrying |     |
|----------------------------------------------------------|--------|-----------|--------|--------|-------------|--------|---------|--------|--------|--------|--------------|--------------|--------|----------|----------|
|                                                     |   | market    |   |   | significant |   |    |   |   |   | significant  |         |   | value    |     |
|                                                     |   | prices in |   |   | observable  |   |    |   |   |   | unobservable |         |   | in the   |     |
|                                                     |   | active    |   |   | market      |   |    |   |   |   | market       |         |   | Balance  |     |
|                                                     |   | markets   |   |   | parameters  |   |    |   |   |   | parameters   |         |   | Sheet    |     |
|                                                     |   |      |   |   |        |   |    |   |   |   |         |         |   |     |     |
|                                                     |   | Level 1   |   |   | Level 2     |   |    |   |   |   | Level 3      |         |   | Total    |     |
|                                                     |   |      |   |   |        |   |    |   |   |   |         |         |   |     |     |
| March 31, 2011:                                          |   |      |   |   |        |   |    |   |   |   |         |         |   |     |     |
| Available-for-sale securities                            |   |      |   |   |        |   |    |   |   |   |         |         |   |     |     |
|    U. S. Government agencies              |   | $         | -      |   |        | $      | 27,606  |   |   |   |         |         | $      | -        |     |   | $ | 27,606 |   |
|    State and local political subdivisions |   |      | -      |   |        |   | 61,556  |   |   |   |         |         |   |     | -        |   |   |   | 61,556 |   |
|    Mortgage-backed securities             |   |      | -      |   |        |   | 42,191  |   |   |   |         |         |   |     | -        |   |   |   | 42,191 |   |
|                                                     |   | $         | -      |   |        | $      | 131,353 |   |   |   |         |         |   | $        | -        |   |   | $ | 131,353 |   |
|                                                     |   |      |   |   |        |   |    |   |   |   |         |         |   |     |     |   |   |   |   |   |
|                                                     |   | Quoted    |   |   | Models with |   |    |   |   |   |         | Models with  |   |     | Carrying |   |
|                                                     |   | market    |   |   | significant |   |    |   |   |   |         | significant  |   |     | value    |   |
|                                                     |   | prices in |   |   | observable  |   |    |   |   |   |         | unobservable |   |     | in the   |   |
|                                                     |   | active    |   |   | market      |   |    |   |   |   |         | market       |   |     | Balance  |   |
|                                                     |   | markets   |   |   | parameters  |   |    |   |   |   |         | parameters   |   |     | Sheet    |   |
|                                                     |   |      |   |   |        |   |    |   |   |   |         |         |   |     |     |   |   |   |   |   |
|                                                     |   | Level 1   |   |   | Level 2     |   |    |   |   |   |         | Level 3      |   |     | Total    |   |
|                                                     |   |      |   |   |        |   |    |   |   |   |         |         |   |     |     |   |   |   |   |   |
| December 31, 2010:                                       |   |      |   |   |        |   |    |   |   |   |         |         |   |     |     |   |   |   |   |   |
| Available-for-sale securities                            |   |      |   |   |        |   |    |   |   |   |         |         |   |     |     |   |   |   |   |   |
|    U. S. Government agencies              |   | $         | -      |   |        | $      | 21,164  |   |   |   |         |         |   | $        | -        |   |   | $ | 21,164 |   |
|    State and local political subdivisions |   |      | -      |   |        |   | 59,975  |   |   |   |         |         |   |     | -        |   |   |   | 59,975 |   |
|    Mortgage-backed securities             |   |      | -      |   |        |   | 43,308  |   |   |   |         |         |   |     | -        |   |   |   | 43,308 |   |
|                                                     |   | $         | -      |   |        | $      | 124,447 |   |   |   |         |         |   | $        | -        |   |   | $ | 124,447 |   |

----

| March 31, 2011                                      |   |       |   |   |      |   |   |        |   |   |         |   |
|-----------------------------------------------------|--------|------------|--------|--------|-----------|--------|--------|-------------|--------|--------|--------------|--------|
|                                                |   |       |   |   |      |   |   |        |   |   |         |   |
|                                                |   | Carrying   |   |   | Quoted    |   |   | Models with |   |   | Models with  |   |
|                                                |   | value      |   |   | market    |   |   | significant |   |   | significant  |   |
|                                                |   | in the     |   |   | prices in |   |   | observable  |   |   | unobservable |   |
|                                                |   | Balance    |   |   | active    |   |   | market      |   |   | market       |   |
|                                                |   | Sheet      |   |   | markets   |   |   | parameters  |   |   | parameters   |   |
|                                                |   |       |   |   |      |   |   |        |   |   |         |   |
|                                                |   | Fair Value |   |   | Level 1   |   |   | Level 2     |   |   | Level 3      |   |
| Impaired Loans                                      |   |       |   |   |      |   |   |        |   |   |         |   |
|    Real estate - construction        |   |       |   |   |      |   |   |        |   |   |         |   |
|       and development |   | $          | 12,687 |   |      | $      | -      |        |   | $      | -            |   |   | $ | 12,687 |   |
|    Real estate - farmland            |   |       | 132    |   |      |   | -      |        |   |   | -            |   |   |   | 132 |   |
|    Real estate - 1-4 family          |   |       |   |   |      |   |   |        |   |   |         |   |   |   |   |   |
|       residential     |   |       | 4,019  |   |      |   | -      |        |   |   | -            |   |   |   | 4,019 |   |
|    Nonfarm/Nonresidential            |   |       | 2,208  |   |      |   | -      |        |   |   | -            |   |   |   | 2,208 |   |
|    Commerical and industrial         |   |       | 151    |   |      |   | -      |        |   |   | -            |   |   |   | 151 |   |
|    Consumer                          |   |       | 28     |   |      |   | -      |        |   |   | -            |   |   |   | 28 |   |
|    Total impaired loans              |   | $          | 19,225 |   |      | $      | -      |        |   | $      | -            |   |   | $ | 19,225 |   |
|                                                |   |       |   |   |      |   |   |        |   |   |         |   |   |   |   |   |
| December 31, 2010                                   |   |       |   |   |      |   |   |        |   |   |         |   |   |   |   |   |
|                                                |   | Carrying   |   |   | Quoted    |   |   | Models with |   |   | Models with  |   |
|                                                |   | value      |   |   | market    |   |   | significant |   |   | significant  |   |
|                                                |   | in the     |   |   | prices in |   |   | observable  |   |   | unobservable |   |
|                                                |   | Balance    |   |   | active    |   |   | market      |   |   | market       |   |
|                                                |   | Sheet      |   |   | markets   |   |   | parameters  |   |   | parameters   |   |
|                                                |   |       |   |   |      |   |   |        |   |   |         |   |   |   |   |   |
|                                                |   | Fair Value |   |   | Level 1   |   |   | Level 2     |   |   | Level 3      |   |
| Impaired Loans                                      |   | $          | 17,091 |   |      | $      | -      |        |   | $      | -            |   |   | $ | 17,091 |   |
|                                                |   |       |   |   |      |   |   |        |   |   |         |   |   |   |   |   |

----

| March 31, 2011          |   |       |   |   |      |   |   |        |   |   |         |   |
|-------------------------|--------|------------|--------|--------|-----------|--------|--------|-------------|--------|--------|--------------|--------|
|                    |   |       |   |   |      |   |   |        |   |   |         |   |
|                    |   | Carrying   |   |   | Quoted    |   |   | Models with |   |   | Models with  |   |
|                    |   | value      |   |   | market    |   |   | significant |   |   | significant  |   |
|                    |   | in the     |   |   | prices in |   |   | observable  |   |   | unobservable |   |
|                    |   | Balance    |   |   | active    |   |   | market      |   |   | market       |   |
|                    |   | Sheet      |   |   | markets   |   |   | parameters  |   |   | parameters   |   |
|                    |   |       |   |   |      |   |   |        |   |   |         |   |
|                    |   | Fair Value |   |   | Level 1   |   |   | Level 2     |   |   | Level 3      |   |
| Other real estate owned |   | $          | 9,765  |   |      | $      | -      |        |   | $      | -            |   |   | $ | 9,765 |   |
|                    |   |       |   |   |      |   |   |        |   |   |         |   |   |   |   |   |
| December 31, 2010       |   |       |   |   |      |   |   |        |   |   |         |   |   |   |   |   |
|                    |   | Carrying   |   |   | Quoted    |   |   | Models with |   |   | Models with  |   |
|                    |   | value      |   |   | market    |   |   | significant |   |   | significant  |   |
|                    |   | in the     |   |   | prices in |   |   | observable  |   |   | unobservable |   |
|                    |   | Balance    |   |   | active    |   |   | market      |   |   | market       |   |
|                    |   | Sheet      |   |   | markets   |   |   | parameters  |   |   | parameters   |   |
|                    |   |       |   |   |      |   |   |        |   |   |         |   |   |   |   |   |
|                    |   | Fair Value |   |   | Level 1   |   |   | Level 2     |   |   | Level 3      |   |
| Other real estate owned |   | $          | 8,233  |   |      | $      | -      |        |   | $      | -            |   |   | $ | 8,233 |   |
|                    |   |       |   |   |      |   |   |        |   |   |         |   |   |   |   |   |

----

| Fair Value of Financial Instruments             |   |
|-------------------------------------------------|--------|
|                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|                                            |   | March 31, 2011 |   |   | December 31, 2010 |   |
|                                            |   | Carrying |   |   | Estimated |   |   | Carrying |   |   | Estimated |   |
|                                            |   | Amount |   |   | Fair Value |   |   | Amount |   |   | Fair Value |   |
|                                            |   | (In thousands) |   |   | (In thousands) |   |
| Financial assets:                               |   |   |   |   |   |   |   |   |   |   |   |   |
|    Cash and cash equivalents     |   | $ | 17,478 |   |   | $ | 17,478 |   |   | $ | 15,264 |   |   | $ | 15,264 |   |
|    Federal funds sold            |   |   | 38,270 |   |   |   | 38,269 |   |   |   | 31,270 |   |   |   | 31,269 |   |
|    Certificates of deposit with  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       other banks |   |   | 1,538 |   |   |   | 1,538 |   |   |   | 1,778 |   |   |   | 1,778 |   |
|    Securities available-for-sale |   |   | 131,353 |   |   |   | 131,353 |   |   |   | 124,447 |   |   |   | 124,447 |   |
|    Securities held-to-maturity   |   |   | 43,667 |   |   |   | 43,379 |   |   |   | 33,095 |   |   |   | 32,541 |   |
|    Securities, other             |   |   | 1,933 |   |   |   | 1,933 |   |   |   | 1,933 |   |   |   | 1,933 |   |
|    Loans                         |   |   | 246,560 |   |   |   | 248,684 |   |   |   | 247,764 |   |   |   | 249,898 |   |
| Financial liabilities:                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Noninterest-bearing deposits  |   |   | 77,616 |   |   |   | 60,830 |   |   |   | 74,022 |   |   |   | 58,013 |   |
|    Interest-bearing deposits     |   |   | 355,465 |   |   |   | 338,515 |   |   |   | 334,721 |   |   |   | 318,760 |   |
|    FHLB and other borrowings     |   |   | 25,290 |   |   |   | 26,885 |   |   |   | 26,970 |   |   |   | 28,671 |   |

----

|                                     |   |     |   |   |     |   |   |      |   |   |     |   |
|------------------------------------------|--------|----------|--------|--------|----------|--------|--------|-----------|--------|--------|----------|--------|
|                                     |   | Mar. 31, |   |   | Dec. 31, |   |   | Sept. 30, |   |   | Jun. 30, |   |
|                                     |   | 2011     |   |   | 2010     |   |   | 2010      |   |   | 2010     |   |
| Loans on non-accrual status              |   | $        | 9,622  |   |     | $      | 9,584  |      |   | $      | 12,268   |   |   | $ | 13,169 |   |
| Loans past due 90 days or more but       |   |     |   |   |     |   |   |      |   |   |     |   |   |   |   |   |
|    not non-accrual status |   |     | 1      |   |     |   | 63     |      |   |   | 27       |   |   |   | 104 |   |
| OREO - non-performing                    |   |     | 16,424 |   |     |   | 16,887 |      |   |   | 16,691   |   |   |   | 15,853 |   |
| Total NPAs                               |   | $        | 26,047 |   |     | $      | 26,534 |      |   | $      | 28,986   |   |   | $ | 29,126 |   |
|                                     |   |     |   |   |     |   |   |      |   |   |     |   |   |   |   |   |
| Operating commercial real                |   |     |   |   |     |   |   |      |   |   |     |   |   |   |   |   |
|    estate OREO            |   | $        | 3,385  |   |     | $      | 3,385  |      |   | $      | 3,450    |   |   | $ | 3,536 |   |
| OREO - non-performing                    |   |     | 16,424 |   |     |   | 16,887 |      |   |   | 16,691   |   |   |   | 15,853 |   |
| Total OREO                               |   | $        | 19,809 |   |     | $      | 20,272 |      |   | $      | 20,141   |   |   | $ | 19,389 |   |
|                                     |   |     |   |   |     |   |   |      |   |   |     |   |   |   |   |   |
| Selected ratios:                         |   |     |   |   |     |   |   |      |   |   |     |   |   |   |   |   |
| NPLs to total gross loans                |   |     | 3.903  |   |     |   | 3.894  |      |   |   | 4.808    |   |   |   | 5.088 |   |
| NPAs to total gross loans and OREO       |   |     | 9.779  |   |     |   | 9.899  |      |   |   | 10.489   |   |   |   | 10.392 |   |
| NPAs to total assets                     |   |     | 4.855  |   |     |   | 5.178  |      |   |   | 5.556    |   |   |   | 5.503 |   |

----

| CHANGES IN CARRYING VALUE OF ORE                                          |                                                                                              |
|---------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------|
|                                                                      |                                                                                              |   |   |   |
| Balance as of December 31, 2009:                                          |                                                                                              |   | $ | 20,770 |   |
|      Additions to OREO                           |                                                                                              |   |   | 892 |   |
|      Sales Proceeds                              |                                                                                              |   |   | (2,033 | ) |
|      Losses and write-downs, net of gains        |                                                                                              |   |   | (155 | ) |
| Balance as of March 31, 2010:                                             |                                                                                              |   | $ | 19,474 |   |
|                                                                      |                                                                                              |   |   |   |   |
| Balance as of December 31, 2010:                                          |                                                                                              |   | $ | 20,272 |   |
|      Additions to OREO                           |                                                                                              |   |   | 380 |   |
|      Sales Proceeds                              |                                                                                              |   |   | (708 | ) |
|      Losses and write-downs, net of gains        |                                                                                              |   |   | (135 | ) |
| Balance as of March 31, 2011:                                             |                                                                                              |   | $ | 19,809 |   |
|                                                                      |                                                                                              |   |   |   |   |
|                                                                      |                                                                                              |   |   |   |   |
|                                                                      | Three Months Ended March 31,                                                                      |   |
|                                                                      | 2011                                                                                              |   |   | 2010 |   |
|                                                                      |                                                                                              |   |   |   |   |
| Writedowns, net of gains on sale                                          |  $         135                                  |   | $ | 155 |   |
| Operating expenses, net of rental income                                  |                 1 |   |   | 101 |   |
|      Total expenses related to foreclosed assets |  $         136                                  |   | $ | 256 |   |
|                                                                      |                                                                                              |   |   |   |   |

| ITEM NO. 2 | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
|------------|---------------------------------------------------------------------------------------------|

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|                                        | (in thousands)                                           |
|---------------------------------------------|----------------------------------------------------------|
| Past due 30 days through 89 days            | $ 5,606                                                  |
| Past due 90 days or more and still accruing | $         1 |

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|                     | Company | Bank   |         |
|--------------------------|---------|--------|--------------|
| Risk-Based Capital Ratio | Ratio   | Ratio  | Requirements |
| Total Capital            | 22.51%  | 18.55% | 8%           |
| Tier 1 Capital           | 21.26%  | 17.29% | 4%           |
| Leverage Capital         | 13.27%  | 10.31% | 4%           |
|                     |    |   |         |

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| ITEM NO. 3 | QUANTITIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK |
|------------|---------------------------------------------------------|

| ITEM NO. 4 | CONTROLS AND PROCEDURES |
|------------|-------------------------|

| PART II-- | OTHER INFORMATION |
|-----------|-------------------|

| ITEM 1. | LEGAL PROCEEDINGS |
|---------|-------------------|

|   | ITEM NO. 1A     RISK FACTORS |
|--------|-------------------------------------------------------|

| ITEM 2. | CHANGES IN SECURITIES |
|---------|-----------------------|

| ITEM 3. | DEFAULT 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) | The Company did not file any reports on Form 8-K during the quarter ended March 31, 2011. |
|--------|-----|-------------------------------------------------------------------------------------------|

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| BY /s/ Frank West                     | BY /s/ Connie Woods Hawkins       |
|---------------------------------------|-----------------------------------|
| Frank West                            | Connie Woods Hawkins              |
| President and Chief Executive Officer | Executive Vice-President, Cashier |
|                                  | and Chief Financial Officer       |
|                                  |                              |
|                                  |                              |
|                                  |                              |
| DATE:  May 9, 2011          | DATE:  May 9, 2011      |

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