| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|-----------------------------------------------------------------------------------------|

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

| CAPITAL CITY BANK GROUP, INC.                          |
|--------------------------------------------------------|
| (Exact name of registrant as specified in its charter) |

| Florida                                                        |   | 59-2273542                           |
|----------------------------------------------------------------|--------|--------------------------------------|
| (State or other jurisdiction of incorporation or organization) |   | (I.R.S. Employer Identification No.) |

| 217 North Monroe Street, Tallahassee, Florida |   | 32301      |
|-----------------------------------------------|--------|------------|
| (Address of principal executive office)       |   | (Zip Code) |

| (850) 402-7000                                       |
|------------------------------------------------------|
| (Registrant's telephone number, including area code) |

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

----

| PART I – Financial Information |                                                                                                     | Page   |   |
|--------------------------------------|----------------------------------------------------------------------------------------------------------|--------|--------|
|                                 |                                                                                                     |
| Item 1.                              | Consolidated Financial Statements (Unaudited)                                                            |   |   |
|                                 | Consolidated Statements of Financial Condition – March 31, 2010 and December 31, 2009              | 4      |   |
|                                 | Consolidated Statements of Income – Three Months Ended March 31, 2010 and 2009                     | 5      |   |
|                                 | Consolidated Statement of Changes in Shareowners’ Equity – Three Months Ended March 31, 2010 | 6      |   |
|                                 | Consolidated Statements of Cash Flow – Three Months Ended March 31, 2010 and 2009                  | 7      |   |
|                                 | Notes to Consolidated Financial Statements                                                               | 8      |   |
|                                 |                                                                                                     |   |   |
| Item 2.                              | Management's Discussion and Analysis of Financial Condition and Results of Operations                    | 18     |   |
|                                 |                                                                                                     |   |   |
| Item 3.                              | Quantitative and Qualitative Disclosure About Market Risk                                                | 33     |   |
|                                 |                                                                                                     |   |   |
| Item 4.                              | Controls and Procedures                                                                                  | 33     |   |
|                                 |                                                                                                     |   |   |
| PART II – Other Information    |                                                                                                     |   |   |
|                                 |                                                                                                     |
| Item 1.                              | Legal Proceedings                                                                                        | 33     |   |
|                                 |                                                                                                     |   |   |
| Item 1A.                             | Risk Factors                                                                                             | 33     |   |
|                                 |                                                                                                     |   |   |
| Item 2.                              | Unregistered Sales of Equity Securities and Use of Proceeds                                              | 33     |   |
|                                 |                                                                                                     |   |   |
| Item 3.                              | Defaults Upon Senior Securities                                                                          | 33     |   |
|                                 |                                                                                                     |   |   |
| Item 4.                              | Removed and Reserved                                                                                     | 33     |   |
|                                 |                                                                                                     |   |   |
| Item 5.                              | Other Information                                                                                        | 33     |   |
|                                 |                                                                                                     |   |   |
| Item 6.                              | Exhibits                                                                                                 | 34     |   |
|                                 |                                                                                                     |   |   |
| Signatures                           |                                                                                                     | 35     |   |
|                                 |                                                                                                     |   |   |
|                                 |                                                                                                     |   |   |
|                                 |                                                                                                     |   |   |

----

| §   | legislative or regulatory changes; |
|--------------------|------------------------------------|

| §   | the strength of the United States economy in general and the strength of the local economies in which we conduct operations; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------|

| §   | the accuracy of our financial statement estimates and assumptions, including the estimate for our loan loss provision; |
|--------------------|------------------------------------------------------------------------------------------------------------------------|

| §   | the effects of the health and soundness of other financial institutions, including the FDIC’s need to increase Deposit Insurance Fund assessments; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| §   | our ability to declare and pay dividends; |
|--------------------|-------------------------------------------|

| §   | changes in the securities and real estate markets; |
|--------------------|----------------------------------------------------|

| §   | changes in monetary and fiscal policies of the U.S. Government; |
|--------------------|-----------------------------------------------------------------|

| §   | inflation, interest rate, market and monetary fluctuations; |
|--------------------|-------------------------------------------------------------|

| §   | the frequency and magnitude of foreclosure of our loans; |
|--------------------|----------------------------------------------------------|

| §   | the effects of our lack of a diversified loan portfolio, including the risks of geographic and industry concentrations; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------|

| §   | our need and our ability to incur additional debt or equity financing; |
|--------------------|------------------------------------------------------------------------|

| §   | our ability to integrate the business and operations of companies and banks that we have acquired, and those we may acquire in the future; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------|

| §   | the effects of harsh weather conditions, including hurricanes; |
|--------------------|----------------------------------------------------------------|

| §   | our ability to comply with the extensive laws and regulations to which we are subject; |
|--------------------|----------------------------------------------------------------------------------------|

| §   | the willingness of clients to accept third-party products and services rather than our products and services and vice versa; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------|

| §   | increased competition and its effect on pricing; |
|--------------------|--------------------------------------------------|

| §   | technological changes; |
|--------------------|------------------------|

| §   | the effects of security breaches and computer viruses that may affect our computer systems; |
|--------------------|---------------------------------------------------------------------------------------------|

| §   | changes in consumer spending and saving habits; |
|--------------------|-------------------------------------------------|

| §   | growth and profitability of our noninterest income; |
|--------------------|-----------------------------------------------------|

| §   | changes in accounting principles, policies, practices or guidelines; |
|--------------------|----------------------------------------------------------------------|

| §   | the limited trading activity of our common stock; |
|--------------------|---------------------------------------------------|

| §   | the concentration of ownership of our common stock; |
|--------------------|-----------------------------------------------------|

| §   | anti-takeover provisions under federal and state law as well as our Articles of Incorporation and our Bylaws; |
|--------------------|---------------------------------------------------------------------------------------------------------------|

| §   | other risks described from time to time in our filings with the Securities and Exchange Commission; and |
|--------------------|---------------------------------------------------------------------------------------------------------|

| §   | our ability to manage the risks involved in the foregoing. |
|--------------------|------------------------------------------------------------|

----

PART I.      FINANCIAL INFORMATION

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

| (Dollars In Thousands, Except Share Data)                                                                                                                                 |   | March 31, 2010 |      |   | December 31, 2009 |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------|-----------|--------|-------------------|--------|
| ASSETS                                                                                                                                                                    |   |           |      |   |              |   |
| Cash and Due From Banks                                                                                                                                                   |   | $              | 52,615    |   |              | $      | 57,877 |   |
| Federal Funds Sold and Interest Bearing Deposits                                                                                                                          |   |           | 293,413   |   |              |   | 276,416 |   |
| Total Cash and Cash Equivalents                                                                                                                                           |   |           | 346,028   |   |              |   | 334,293 |   |
|                                                                                                                                                                      |   |           |      |   |              |   |   |   |
| Investment Securities, Available-for-Sale                                                                                                                                 |   |           | 217,606   |   |              |   | 176,673 |   |
|                                                                                                                                                                      |   |           |      |   |              |   |   |   |
| Loans, Net of Unearned Interest                                                                                                                                           |   |           | 1,851,621 |   |              |   | 1,915,940 |   |
| Allowance for Loan Losses                                                                                                                                                 |   |           | (41,198   | )      |              |   | (43,999 | ) |
| Loans, Net                                                                                                                                                                |   |           | 1,810,423 |   |              |   | 1,871,941 |   |
|                                                                                                                                                                      |   |           |      |   |              |   |   |   |
| Premises and Equipment, Net                                                                                                                                               |   |           | 117,055   |   |              |   | 115,439 |   |
| Goodwill                                                                                                                                                                  |   |           | 84,811    |   |              |   | 84,811 |   |
| Other Intangible Assets                                                                                                                                                   |   |           | 3,320     |   |              |   | 4,030 |   |
| Other Real Estate Owned                                                                                                                                                   |   |           | 46,444    |   |              |   | 36,134 |   |
| Other Assets                                                                                                                                                              |   |           | 89,416    |   |              |   | 85,003 |   |
| Total Assets                                                                                                                                                              |   | $              | 2,715,103 |   |              | $      | 2,708,324 |   |
|                                                                                                                                                                      |   |           |      |   |              |   |   |   |
| LIABILITIES                                                                                                                                                               |   |           |      |   |              |   |   |   |
| Deposits:                                                                                                                                                                 |   |           |      |   |              |   |   |   |
| Noninterest Bearing Deposits                                                                                                                                              |   | $              | 446,855   |   |              | $      | 427,791 |   |
| Interest Bearing Deposits                                                                                                                                                 |   |           | 1,836,085 |   |              |   | 1,830,443 |   |
| Total Deposits                                                                                                                                                            |   |           | 2,282,940 |   |              |   | 2,258,234 |   |
|                                                                                                                                                                      |   |           |      |   |              |   |   |   |
| Short-Term Borrowings                                                                                                                                                     |   |           | 18,900    |   |              |   | 35,841 |   |
| Subordinated Notes Payable                                                                                                                                                |   |           | 62,887    |   |              |   | 62,887 |   |
| Other Long-Term Borrowings                                                                                                                                                |   |           | 50,679    |   |              |   | 49,380 |   |
| Other Liabilities                                                                                                                                                         |   |           | 37,738    |   |              |   | 34,083 |   |
| Total Liabilities                                                                                                                                                         |   |           | 2,453,144 |   |              |   | 2,440,425 |   |
|                                                                                                                                                                      |   |           |      |   |              |   |   |   |
| SHAREOWNERS' EQUITY                                                                                                                                                       |   |           |      |   |              |   |   |   |
| Preferred Stock, $.01 par value, 3,000,000 shares authorized;no shares outstanding                                                                                        |   |           | -         |   |              |   | - |   |
| Common Stock, $.01 par value, 90,000,000 shares authorized; 17,063,123 and 17,036,407 shares issued and outstanding at March 31, 2010 and December 31, 2009, respectively |   |           | 171       |   |              |   | 170 |   |
| Additional Paid-In Capital                                                                                                                                                |   |           | 36,816    |   |              |   | 36,099 |   |
| Retained Earnings                                                                                                                                                         |   |           | 239,755   |   |              |   | 246,460 |   |
| Accumulated Other Comprehensive Loss, Net of Tax                                                                                                                          |   |           | (14,783   | )      |              |   | (14,830 | ) |
| Total Shareowners' Equity                                                                                                                                                 |   |           | 261,959   |   |              |   | 267,899 |   |
| Total Liabilities and Shareowners' Equity                                                                                                                                 |   | $              | 2,715,103 |   |              | $      | 2,708,324 |   |

----

CONSOLIDATED STATEMENTS OF INCOME

|                                                     | Three Months Ended |       |
|----------------------------------------------------------|--------------------|------------|
| (Dollars in Thousands, Except Per Share Data)            | 2010               |       | 2009 |   |
| INTEREST INCOME                                          |               |       |   |   |
| Interest and Fees on Loans                               | $                  | 26,992     |   | $ | 29,537 |   |
| Investment Securities:                                   |               |       |   |   |   |   |
| U.S. Treasuries                                          |               | 103        |   |   | 162 |   |
| U.S. Government Agencies                                 |               | 320        |   |   | 530 |   |
| States and Political Subdivisions                        |               | 490        |   |   | 737 |   |
| Other Securities                                         |               | 77         |   |   | 84 |   |
| Federal Funds Sold                                       |               | 172        |   |   | 3 |   |
| Total Interest Income                                    |               | 28,154     |   |   | 31,053 |   |
|                                                     |               |       |   |   |   |   |
| INTEREST EXPENSE                                         |               |       |   |   |   |   |
| Deposits                                                 |               | 2,938      |   |   |          2,495 |   |
| Short-Term Borrowings                                    |               | 17         |   |   |               68 |   |
| Subordinated Notes Payable                               |               | 651        |   |   | 927 |   |
| Other Long-Term Borrowings                               |               | 526        |   |   | 568 |   |
| Total Interest Expense                                   |               | 4,132      |   |   | 4,058 |   |
|                                                     |               |       |   |   |   |   |
| NET INTEREST INCOME                                      |               | 24,022     |   |   | 26,995 |   |
| Provision for Loan Losses                                |               | 10,740     |   |   | 8,410 |   |
| Net Interest Income After Provision For Loan Losses |               | 13,282     |   |   | 18,585 |   |
|                                                     |               |       |   |   |   |   |
| NONINTEREST INCOME                                       |               |       |   |   |   |   |
| Service Charges on Deposit Accounts                      |               | 6,628      |   |   | 6,698 |   |
| Data Processing                                          |               | 900        |   |   | 870 |   |
| Asset Management Fees                                    |               | 1,020      |   |   | 970 |   |
| Securities Transactions                                  |               | 5          |   |   | - |   |
| Mortgage Banking Fees                                    |               | 508        |   |   | 584 |   |
| Bank Card Fees                                           |               | 2,840      |   |   | 2,877 |   |
| Other                                                    |               | 2,066      |   |   | 2,043 |   |
| Total Noninterest Income                                 |               | 13,967     |   |   | 14,042 |   |
|                                                     |               |       |   |   |   |   |
| NONINTEREST EXPENSE                                      |               |       |   |   |   |   |
| Salaries and Associate Benefits                          |               | 16,779     |   |   | 17,237 |   |
| Occupancy, Net                                           |               | 2,408      |   |   | 2,345 |   |
| Furniture and Equipment                                  |               | 2,181      |   |   | 2,338 |   |
| Intangible Amortization                                  |               | 710        |   |   | 1,011 |   |
| Other                                                    |               | 11,306     |   |   | 9,326 |   |
| Total Noninterest Expense                                |               | 33,384     |   |   | 32,257 |   |
|                                                     |               |       |   |   |   |   |
| (LOSS) INCOME BEFORE INCOME TAXES                        |               | (6,135     | ) |   | 370 |   |
| Income Tax Benefit                                       |               | (2,672     | ) |   | (280 | ) |
|                                                     |               |       |   |   |   |   |
| NET (LOSS) INCOME                                        | $                  | (3,463     | ) | $ | 650 |   |
|                                                     |               |       |   |   |   |   |
| Basic Net Income Per Share                               | $                  | (0.20      | ) | $ | 0.04 |   |
| Diluted Net Income Per Share                             | $                  | (0.20      | ) | $ | 0.04 |   |
|                                                     |               |       |   |   |   |   |
| Average Basic Shares Outstanding                         |               | 17,057,061 |   |   | 17,109,228 |   |
| Average Diluted Shares Outstanding                       |               | 17,069,550 |   |   | 17,130,810 |   |

----

CONSOLIDATED STATEMENT OF CHANGES IN SHAREOWNERS' EQUITY

|   (Dollars In Thousands, Except Share Data)                                        | Shares Outstanding |   |   | Common Stock |   |   | AdditionalPaid-In Capital |   | Retained Earnings |    |    | Accumulated Other Comprehensive Income, Net of Taxes |   |    | Total  |   |   |
|----------------------------------------------------------------------------------------------|--------------------|--------|--------|--------------|--------|--------|---------------------------|--------|-------------------|---------|---------|------------------------------------------------------|--------|---------|--------|--------|--------|
|                                                                                         |               |   |   |         |   |   |                      |   |              |    |    |                                                 |   |    |   |   |
| Balance, December 31, 2009                                                                   | 17,036,407         |   | $      |  170    |   | $      | 36,099                    |   | $                 | 246,460 |    |                                                 | $      | (14,830 | )      |   | $      | 267,899 |   |
| Comprehensive Income:                                                                        |               |   |   |         |   |   |                      |   |              |    |    |                                                 |   |    |   |   |   |   |   |
| Net Loss                                                                                     | -                  |   |   | -            |   |   | -                         |   |              | (3,463  | )  |                                                 |   | -       |   |   |   | (3,463 | )  |
| Net Change in Unrealized Gain On   Available-for-Sale Securities (net of tax) | -                  |   |   | -            |   |   | -                         |   |              | -       |    |                                                 |   | 47      |   |   |   | 47 |   |
| Total Comprehensive Income                                                                   | -                  |   |   | -            |   |   | -                         |   |              |    |    |                                                 |   |    |   |   |   | (3,416 | )  |
| Cash Dividends ($.1900 per share)                                                            | -                  |   |   | -            |   |   | -                         |   |              | (3,242  | )       |                                                 |   | -       |   |   |   | (3,242 | ) |
| Stock Performance Plan Compensation                                                          | -                  |   |   | -            |   |   | 358                       |   |              | -       |    |                                                 |   | -       |   |   |   | 358 |   |
| Issuance of Common Stock                                                                     | 26,716             |   |   | 1            |   |   | 359                       |   |              | -       |    |                                                 |   | -       |   |   |   | 360 |   |
|                                                                                         |               |   |   |         |   |   |                      |   |              |    |    |                                                 |   |    |   |   |   |   |   |
| Balance, March 31, 2010                                                                      | 17,063,123         |   | $      |  171    |   | $      | 36,816                    |   | $                 | 239,755 |    |                                                 | $      | (14,783 | )      |   | $      | 261,959 |   |

----

CONSOLIDATED STATEMENTS OF CASH FLOWS

| (Dollars in Thousands)                                                       |   | 2010   |                                                                                                                  |    | 2009   |   |
|------------------------------------------------------------------------------|--------|--------|-----------------------------------------------------------------------------------------------------------------------|---------|--------|--------|
| CASH FLOWS FROM OPERATING ACTIVITIES                                         |   |   |                                                                                                                  |    |   |   |
| Net Income                                                                   |   | $      | (3,463                                                                                                                | )  |   | $      | 650 |   |
| Adjustments to Reconcile Net Income toCash Provided by Operating Activities: |   |   |                                                                                                                  |    |   |   |   |   |
| Provision for Loan Losses                                                    |   |   |          10,740                                                          |    |   |   | 8,410 |   |
| Depreciation                                                                 |   |   |            1,689                                               |    |   |   | 1,678 |   |
| Net Securities Amortization                                                  |   |   |            689                                                 |    |   |   | 455 |   |
| Amortization of Intangible Assets                                            |   |   |            710                                                 |    |   |   | 1,011 |   |
| Gain on Securities Transactions                                              |   |   |               (5                                | )       |   |   | - |   |
| Origination of Loans Held-for-Sale                                           |   |   |      (22,089                                                                                 | )       |   |   | (41,171 | ) |
| Proceeds From Sales of Loans Held-for-Sale                                   |   |   |        23,963                                                                      |    |   |   | 37,314 |   |
| Net Gain From Sales of Loans Held-for-Sale                                   |   |   |          (508                                                            | )       |   |   | (584 | ) |
| Non-Cash Compensation                                                        |   |   |                    358 |    |   |   | (11 | ) |
| Decrease (Increase) in Deferred Income Taxes                                 |   |   |            2,251                                               |    |   |   | (1,321 | ) |
| Net Decrease (Increase) in Other Assets                                      |   |   |             4,218                                         |    |   |   | (6,244 | ) |
| Net (Decrease) Increase in Other Liabilities                                 |   |   | (2,049                                                                                                                | )       |   |   | 13,377 |   |
| Net Cash Provided By Operating Activities                                    |   |   |          16,504                                                          |    |   |   | 13,564 |   |
|                                                                         |   |   |                                                                                                                  |    |   |   |   |   |
| CASH FLOWS FROM INVESTING ACTIVITIES                                         |   |   |                                                                                                                  |    |   |   |   |   |
| Securities Available-for-Sale:                                               |   |   |                                                                                                                  |    |   |   |   |   |
| Purchases                                                                    |   |   |        (69,842                                                                     | )       |   |   | (24,755 | ) |
| Sales                                                                        |   |   |            505                                                 |    |   |   | 1,067 |   |
| Payments, Maturities, and Calls                                              |   |   |          27,379                                                          |    |   |   | 19,443 |   |
| Net Decrease (Increase) in Loans                                             |   |   |        34,312                                                                      |    |   |   | (17,762 | ) |
| Purchase of Premises & Equipment                                         |   |   |        (3,304                                                                      | )       |   |   | (2,507 | ) |
| Proceeds From Sales of Premises & Equipment                              |   |   |        -                                                                           |    |   |   | 2 |   |
| Net Cash Used In Investing Activities                                        |   |   |                (10,950                     | )  |   |   | (24,512 | )  |
|                                                                         |   |   |                                                                                                                  |    |   |   |   |   |
| CASH FLOWS FROM FINANCING ACTIVITIES                                         |   |   |                                                                                                                  |    |   |   |   |   |
| Increase (Decrease) in Deposits                                              |   |   |        24,706                                                                      |    |   |   | (2,384 | ) |
| Net (Decrease) Increase in Short-Term Borrowings                             |   |   |          (16,941                                                         | )  |   |   | 6,151 |   |
| Increase in Other Long-Term Borrowings                                       |   |   |                   2,429     |    |   |   | 2,666 |   |
| Repayment of Other Long-Term Borrowings                                      |   |   |          (1,131                                                          | )       |   |   | (691 | ) |
| Dividends Paid                                                               |   |   |          (3,242                                                          | )       |   |   | (3,253 | ) |
| Repurchase of Common Stock                                                   |   |   |          -                                                               |    |   |   | (1,561 | )  |
| Issuance of Common Stock                                                     |   |   |          360                                                             |    |   |   | 629 |   |
| Net Cash Provided by Financing Activities                                    |   |   |               6,181                             |    |   |   | 1,557 |   |
|                                                                         |   |   |                                                                                                                  |    |   |   |   |   |
| NET CHANGE IN CASH AND CASH EQUIVALENTS                                      |   |   | 11,735                                                                                                                |    |   |   | (9,391 | ) |
|                                                                         |   |   |                                                                                                                  |    |   |   |   |   |
| Cash and Cash Equivalents at Beginning of Period                             |   |   | 334,293                                                                                                               |    |   |   | 94,949 |   |
| Cash and Cash Equivalents at End of Period                                   |   | $      | 346,028                                                                                                               |    |   | $      | 85,558 |   |
|                                                                         |   |   |                                                                                                                  |    |   |   |   |   |
| Supplemental Disclosure:                                                     |   |   |                                                                                                                  |    |   |   |   |   |
| Interest Paid on Deposits                                                    |   | $      | 2,937                                                                                                                 |    |   | $      | 2,773 |   |
| Interest Paid on Debt                                                        |   | $      | 1,192                                                                                                                 |    |   | $      | 1,558 |   |
| Taxes Paid                                                                   |   | $      | 166                                                                                                                   |    |   | $      | 53 |   |
| Loans Transferred to Other Real Estate Owned                                 |   | $      | 15,100                                                                                                                |    |   | $      | 3,147 |   |
| Issuance of Common Stock as Non-Cash Compensation                            |   | $      | 359                                                                                                                   |    |   | $      | 154 |   |
| Transfer of Current Portion of Long-Term Borrowings                          |   | $      | 8                                                                                                                     |    |   |   | - |   |

----

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

| NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES |
|-----------------------------------------------|

| NOTE 2 - INVESTMENT SECURITIES |
|--------------------------------|

|                                   |   | March 31, 2010 |                                                                           |
|----------------------------------------|--------|----------------|--------------------------------------------------------------------------------|
| (Dollars in Thousands)                 |   | Amortized Cost |                                                                           |   | Unrealized Gains |   |   | Unrealized Losses |   |   | Market Value |   |
| U.S. Treasury                          |   | $              | 75,471                                                                         |   |   | $ | 152 |   |   | $ | - |   |   | $ | 75,623 |   |
| States and Political Subdivisions      |   |           | 93,481                                                                         |   |   |   |             777 |   |   |   | 39 |   |   |   | 94,219 |   |
| Residential Mortgage-Backed Securities |   |           |             34,423 |   |   |   |               822 |   |   |   | 17 |   |   |   |        35,228 |   |
| Other Securities(1)                    |   |           |             13,236 |   |   |   |                - |   |   |   | 700 |   |   |   |        12,536 |   |
| Total Investment Securities            |   | $              |           216,611            |   |   | $ |            1,751 |   |   | $ | 756 |   |   | $ |      217,606 |   |

|                                   |   | December 31, 2009 |                                              |
|----------------------------------------|--------|-------------------|---------------------------------------------------|
| (Dollars in Thousands)                 |   | Amortized Cost    |                                              |   | Unrealized Gains |   |   | Unrealized Losses |   |   | Market Value |   |
| U.S. Treasury                          |   | $                 | 22,270                                            |   |   | $ | 174 |   |   | $ | - |   |   | $ | 22,444 |   |
| States and Political Subdivisions      |   |              | 106,455                                           |   |   |   | 1,166 |   |   |   | 71 |   |   |   | 107,550 |   |
| Residential Mortgage-Backed Securities |   |              | 33,375                                            |   |   |   | 798 |   |   |   | 30 |   |   |   | 34,143 |   |
| Other Securities(1)                    |   |              | 13,236                                            |   |   |   | - |   |   |   | 700 |   |   |   | 12,536 |   |
| Total Investment Securities            |   | $                 |        175,336 |   |   | $ |             2,138 |   |   | $ |      801 |   |   | $ |   176,673 |   |

|  (1) | Includes Federal Home Loan Bank and Federal Reserve Bank stock recorded at cost of $7.7 million and $4.8 million, respectively, at March 31, 2010, and $7.7 million and $4.8 million, respectively, at December 31, 2009. |
|-----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (Dollars in Thousands)           |   | Amortized Cost |                                                                                                                                              |   | Market Value |   |
|----------------------------------|--------|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------|--------|
| Due in one year or less          |   | $              |                  72,122                                      |   |         | $      |                 72,727 |   |
| Due after one through five years |   |           |                  131,038                                     |   |         |   |                 132,121 |   |
| Due after five through ten years |   |           |                    215                             |   |         |   |                   222 |   |
| Due over ten years               |   |           |                         - |   |         |   |                         - |   |
| No Maturity                      |   |           |                  12,536                                      |   |         |   |                 12,536 |   |
| Total Investment Securities      |   | $              | 215,911                                                                                                                                           |   |         | $      | 217,606 |   |

|                                                              |               |   | March 31, 2010        |   |        |   |
|-------------------------------------------------------------------|--------------------|--------|-----------------------|--------|-------------|--------|
|                                                              | Less Than12 Months |   | Greater Than12 Months |   | Total       |   |
| (Dollars in Thousands)                                            | MarketValue        |   | UnrealizedLosses      |   | MarketValue |   | UnrealizedLosses |   | MarketValue |   | UnrealizedLosses |   |
| U.S. Treasury                                                     |               | $      | 19,384                |   |        | $      | - |   |   | $ | - |   |   | $ | - |   |   | $ | 19,384 |   |   | $ | - |   |
|     U.S. Government Agencies and Corporations |               |   | -                     |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
|     States and Political Subdivisions         |               |   | 4,134                 |   |        |   | 39 |   |   |   | - |   |   |   | - |   |   |   | 4,134 |   |   |   | 39 |   |
|     Mortgage-Backed Securities           |               |   |  3,367           |   |        |   |  12 |   |   |   | 2,335 |   |   |   | 5 |   |   |   | 5,702 |   |   |   | 17 |   |
|     Other Securities                          |               |   | 700                   |   |        |   | 700 |   |   |   | - |   |   |   | - |   |   |   | 700 |   |   |   | 700 |   |
|     Total Investment Securities               |               | $      | 27,585                |   |        | $      | 751 |   |   | $ |   2,335 |   |   | $ |   5 |   |   | $ | 29,920 |   |   | $ | 756 |   |

----

| (Dollars in Thousands)                 |   | March 31, 2010 |      |   | December 31, 2009 |   |
|----------------------------------------|--------|----------------|-----------|--------|-------------------|--------|
| Commercial, Financial and Agricultural |   | $              | 169,766   |   |              | $      | 189,061 |   |
| Real Estate-Construction               |   |           | 79,145    |   |              |   | 111,249 |   |
| Real Estate-Commercial                 |   |           | 729,011   |   |              |   | 716,791 |   |
| Real Estate-Residential(1)             |   |           | 395,802   |   |              |   | 408,578 |   |
| Real Estate-Home Equity                |   |           | 245,185   |   |              |   | 246,722 |   |
| Real Estate-Loans Held-for-Sale        |   |           | 5,218     |   |              |   | 7,891 |   |
| Consumer                               |   |           | 227,494   |   |              |   | 235,648 |   |
| Loans, Net of Unearned Interest        |   | $              | 1,851,621 |   |              | $      | 1,915,940 |   |

| (1) | Includes loans in process with outstanding balances of $7.1 million and $10.7 million for March 31, 2010 and December 31, 2009, respectively. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------|

| (Dollars in Thousands)                                  |   | 2010   |    |   | 2009   |   |
|---------------------------------------------------------|--------|--------|---------|--------|--------|--------|
| Balance, Beginning of Period                            |   | $      | 43,999  |   |   | $      | 37,004 |   |
| Provision for Loan Losses                               |   |   | 10,740  |   |   |   | 8,410 |   |
| Recoveries on Loans Previously Charged-Off              |   |   | 893     |   |   |   | 1,029 |   |
| Loans Charged-Off                                       |   |   | (14,429 | )      |   |   | (6,271 | ) |
| Reclassification of Unfunded Reserve to Other Liability |   |   | (5      | )      |   |   | - |   |
| Balance, End of Period                                  |   | $      | 41,198  |   |   | $      | 40,172 |   |

|                                |   | March 31, 2010 |   |   | December 31, 2009   |   |
|-------------------------------------|--------|----------------|--------|--------|---------------------|--------|
|  (Dollars in Thousands)        |   | Balance        |   |   | Valuation Allowance |   |   | Balance |   |   | Valuation Allowance |   |
| Impaired Loans:                     |   |           |   |   |                |   |   |   |   |   |   |   |
| With Related Valuation Allowance    |   | $              | 98,876 |   |                | $      | 17,566 |   |   | $ | 83,986 |   |   | $ | 21,066 |   |
| Without Related Valuation Allowance |   |           | 22,511 |   |                |   | - |   |   |   | 27,926 |   |   |   | - |   |

| NOTE 5 - INTANGIBLE ASSETS |
|----------------------------|

|                             |   | March 31, 2010 |    |   | December 31, 2009       |   |
|----------------------------------|--------|----------------|---------|--------|-------------------------|--------|
|  (Dollars in Thousands)     |   | GrossAmount    |    |   | AccumulatedAmortization |   |   | GrossAmount |   |   | AccumulatedAmortization |   |
| Core Deposit Intangibles         |   | $              | 47,176  |   |                    | $      | 44,605 |   |   | $ | 47,176 |   |   | $ | 43,943 |   |
| Goodwill                         |   |           | 84,811  |   |                    |   | - |   |   |   | 84,811 |   |   |   | - |   |
| Customer Relationship Intangible |   |           | 1,867   |   |                    |   | 1,118 |   |   |   | 1,867 |   |   |   | 1,070 |   |
| Total Intangible Assets          |   | $              | 133,854 |   |                    | $      | 45,723 |   |   | $ | 133,854 |   |   | $ | 45,013 |   |

----

| (Dollars in Thousands)          |   | March 31, 2010 |      |   | December 31, 2009 |   |
|---------------------------------|--------|----------------|-----------|--------|-------------------|--------|
| NOW Accounts                    |   | $              | 890,570   |   |              | $      | 899,649 |   |
| Money Market Accounts           |   |           | 376,091   |   |              |   | 373,105 |   |
| Savings Deposits                |   |           | 130,936   |   |              |   | 122,370 |   |
| Other Time Deposits             |   |           | 438,488   |   |              |   | 435,319 |   |
| Total Interest Bearing Deposits |   | $              | 1,836,085 |   |              | $      | 1,830,443 |   |

| NOTE 7 - STOCK-BASED COMPENSATION |
|-----------------------------------|

----

| Options                        |   | Shares |   |   | Weighted-Average Exercise Price |   |   | Weighted-Average Remaining Term |   |   | Aggregate Intrinsic Value |   |
|--------------------------------|--------|--------|--------|--------|---------------------------------|--------|--------|---------------------------------|--------|--------|---------------------------|--------|
| Outstanding at January 1, 2010 |   |   | 60,384 |   |                            | $      | 32.79  |                            |   |   | 4.9                       |   |   | $ | - |   |
| Granted                        |   |   | -      |   |                            |   | -      |                            |   |   | -                         |   |   |   | - |   |
| Exercised                      |   |   | -      |   |                            |   | -      |                            |   |   | -                         |   |   |   | - |   |
| Forfeited or expired           |   |   | -      |   |                            |   | -      |                            |   |   | -                         |   |   |   | - |   |
| Outstanding at March 31, 2010  |   |   | 60,384 |   |                            | $      | 32.79  |                            |   |   | 4.6                       |   |   | $ | - |   |
| Exercisable at March 31, 2010  |   |   | 60,384 |   |                            | $      | 32.79  |                            |   |   | 4.6                       |   |   | $ | - |   |

|                               |   | Three Months Ended March 31, |   |
|------------------------------------|--------|------------------------------|--------|
| (Dollars in Thousands)             |   | 2010                         |   |   | 2009 |   |
|                               |   |                         |   |   |   |   |
| Discount Rate                      |   |                         | 5.75   | % |   |   | 6.00 | % |
| Long-Term Rate of Return on Assets |   |                         | 8.00   | % |   |   | 8.00 | % |
|                               |   |                         |   |   |   |   |   |   |
| Service Cost                       |   | $                            | 1,525  |   |   | $ | 1,525 |   |
| Interest Cost                      |   |                         | 1,175  |   |   |   | 1,200 |   |
| Expected Return on Plan Assets     |   |                         | (1,525 | ) |   |   | (1,275 | ) |
| Prior Service Cost Amortization    |   |                         | 125    |   |   |   | 125 |   |
| Net Loss Amortization              |   |                         | 525    |   |   |   | 750 |   |
| Net Periodic Benefit Cost          |   | $                            | 1,825  |   |   | $ | 2,325 |   |

|                            |   | Three Months Ended March 31, |   |
|---------------------------------|--------|------------------------------|--------|
| (Dollars in Thousands)          |   | 2010                         |   |   | 2009 |   |
|                            |   |                         |   |   |   |   |
| Discount Rate                   |   |                         | 5.75   | % |   |   | 6.0 | % |
|                            |   |                         |   |   |   |   |   |   |
| Service Cost                    |   | $                            | -      |   |   | $ | 5 |   |
| Interest Cost                   |   |                         | 42     |   |   |   | 74 |   |
| Prior Service Cost Amortization |   |                         | 45     |   |   |   | 45 |   |
| Net Gain Amortization           |   |                         | (85)   |   |   |   | (5 | )  |
| Net Periodic Benefit Cost       |   | $                            | 2      |   |   | $ | 119 |   |

----

| NOTE 9 - COMMITMENTS AND CONTINGENCIES |
|----------------------------------------|

| (Dollars in Millions)           |   | Amount |   |
|---------------------------------|--------|--------|--------|
| Commitments to Extend Credit(1) |   | $      | 351    |   |
| Standby Letters of Credit       |   | $      | 14     |   |

| (1) | Commitments include unfunded loans, revolving lines of credit, and other unused commitments. |
|-----|----------------------------------------------------------------------------------------------|

----

|  (Dollars in Thousands)                               |   | Level 1 Inputs |         |   | Level 2 Inputs |   |    | Level 3 Inputs |   |   | Total Fair Value |   |
|------------------------------------------------------------|--------|----------------|--------------|--------|----------------|--------|---------|----------------|--------|--------|------------------|--------|
| March 31, 2010                                             |   |           |         |   |           |   |    |           |   |   |             |   |
| Securities available for sale:                             |   |           |         |   |           |   |    |           |   |   |             |   |
|     US Treasury                             |   | $              | 75,623       |   |           | $      | -       |           |   | $      | -                |   |   | $ | 75,623 |   |
|     States and Political Subdivisions       |   |           | 4,781        |   |           |   | 89,438  |           |   |   | -                |   |   |   | 94,219 |   |
|     Residential Mortgage-Backed Securities  |   |           | -            |   |           |   | 35,228  |           |   |   | -                |   |   |   | 35,228 |   |
|                                                       |   |           |         |   |           |   |    |           |   |   |             |   |   |   |   |   |
| December 31, 2009                                          |   |           |         |   |           |   |    |           |   |   |             |   |   |   |   |   |
| Securities available for sale:                             |   |           |         |   |           |   |    |           |   |   |             |   |   |   |   |   |
|     US Treasury                        |   |           | 22, 444 |   |           |   | -       |           |   |   | -                |   |   |   | 22,444 |   |
|     States and Political Subdivisions  |   |           | 3,709        |   |           |   | 103,841 |           |   |   | -                |   |   |   | 107,550 |   |
|     Residential Mortgage-Backed Securities  |   |           | -            |   |           |   | 34,143  |           |   |   | -                |   |   |   | 34,143 |   |
|                                                       |   |           |         |   |           |   |    |           |   |   |             |   |   |   |   |   |

----

|                                    |   |           |      |
|-----------------------------------------|--------|----------------|-----------|
|                                    |   | March 31, 2010 |      |   | December 31, 2009 |   |
| (Dollars in Thousands)                  |   | CarryingValue  |      |   | EstimatedFairValue |   |   | CarryingValue |   |   | EstimatedFairValue |   |
| Financial Assets:                       |   |           |      |   |   |   |   |   |   |   |   |   |
| Cash                                    |   | $              | 52,615    |   |   | $ | 52,615 |   |   | $ | 57,877 |   |   | $ | 57,877 |   |
| Short-Term Investments                  |   |           | 293,413   |   |   |   | 293,413 |   |   |   | 276,416 |   |   |   | 276,416 |   |
| Investment Securities                   |   |           | 217,606   |   |   |   | 217,606 |   |   |   | 176,673 |   |   |   | 176,673 |   |
| Loans, Net of Allowance for Loan Losses |   |           | 1,810,423 |   |   |   | 1,761,570 |   |   |   | 1,871,941 |   |   |   | 1,851,699 |   |
| Total Financial Assets                  |   | $              | 2,374,057 |   |   | $ | 2,325,204 |   |   | $ | 2,382,907 |   |   | $ | 2,362,665 |   |
|                                    |   |           |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Financial Liabilities:                  |   |           |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                                |   | $              | 2,282,940 |   |   | $ | 2,284,902 |   |   | $ | 2,258,234 |   |   | $ | 2,258,899 |   |
| Short-Term Borrowings                   |   |           | 18,900    |   |   |   | 18,083 |   |   |   | 35,841 |   |   |   | 34,209 |   |
| Subordinated Notes Payable              |   |           | 62,887    |   |   |   | 62,866 |   |   |   | 62,887 |   |   |   | 62,569 |   |
| Long-Term Borrowings                    |   |           | 50,679    |   |   |   | 52,976 |   |   |   | 49,380 |   |   |   | 51,509 |   |
| Total Financial Liabilities             |   | $              | 2,415,406 |   |   | $ | 2,418,827 |   |   | $ | 2,406,342 |   |   | $ | 2,407,186 |   |

----

----

|                                                |   | 2010   |      |   | 2009   |   |      | 2008   |   |
|-----------------------------------------------------|--------|--------|-----------|--------|--------|--------|-----------|--------|--------|
|  (Dollars in Thousands, Except Per Share Data) |   | First  |      |   | Fourth |   |      | Third  |   |   | Second |   |   | First |   |   | Fourth |   |   | Third(1) |   |   | Second |   |
| Summary of Operations:                              |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Income                                     |   | $      | 28,154    |   |   | $      | 29,756    |   |   | $ | 30,787 |   |   | $ | 31,180 |   |   | $ | 31,053 |   |   | $ | 33,229 |   |   | $ | 34,654 |   |   | $ | 36,260 |   |
| Interest Expense                                    |   |   | 4,132     |   |   |   | 4,464     |   |   |   | 4,235 |   |   |   | 4,085 |   |   |   | 4,058 |   |   |   | 5,482 |   |   |   | 7,469 |   |   |   | 8,785 |   |
| Net Interest Income                                 |   |   | 24,022    |   |   |   | 25,292    |   |   |   | 26,552 |   |   |   | 27,095 |   |   |   | 26,995 |   |   |   | 27,747 |   |   |   | 27,185 |   |   |   | 27,475 |   |
| Provision for Loan Losses                           |   |   | 10,740    |   |   |   | 10,834    |   |   |   | 12,347 |   |   |   | 8,426 |   |   |   | 8,410 |   |   |   | 12,497 |   |   |   | 10,425 |   |   |   | 5,432 |   |
| Net Interest Income AfterProvision for Loan Losses  |   |   | 13,282    |   |   |   | 14,458    |   |   |   | 14,205 |   |   |   | 18,669 |   |   |   | 18,585 |   |   |   | 15,250 |   |   |   | 16,760 |   |   |   | 22,043 |   |
| Noninterest Income                                  |   |   | 13,967    |   |   |   | 14,411    |   |   |   | 14,304 |   |   |   | 14,634 |   |   |   | 14,042 |   |   |   | 13,311 |   |   |   | 20,212 |   |   |   | 15,718 |   |
| Noninterest Expense                                 |   |   | 33,384    |   |   |   | 35,313    |   |   |   | 31,615 |   |   |   | 32,930 |   |   |   | 32,257 |   |   |   | 31,002 |   |   |   | 29,916 |   |   |   | 30,756 |   |
| (Loss) Income Before Income Taxes                   |   |   | (6,135    | )      |   |   | (6,444    | )      |   |   | (3,106 | ) |   |   | 373 |   |   |   | 370 |   |   |   | (2,441 | ) |   |   | 7,056 |   |   |   | 7,005 |   |
| Income Tax (Benefit) Expense                        |   |   | (2,672    | )      |   |   | (3,037    | )      |   |   | (1,618 | ) |   |   | (401 | ) |   |   | (280 | ) |   |   | (738 | ) |   |   | 2,218 |   |   |   | 2,195 |   |
| Net (Loss) Income                                   |   | $      | (3,463    | )      |   | $      | (3,407    | )      |   | $ | (1,488 | ) |   | $ | 774 |   |   | $ | 650 |   |   | $ | (1,703 | ) |   | $ | 4,838 |   |   | $ | 4,810 |   |
| Net Interest Income (FTE)                           |   | $      | 24,473    |   |   | $      | 25,845    |   |   | $ | 27,128 |   |   | $ | 27,679 |   |   | $ | 27,578 |   |   | $ | 28,387 |   |   | $ | 27,802 |   |   | $ | 28,081 |   |
|                                                |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Per Common Share:                                   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net (Loss) Income Basic                             |   | $      | (0.20     | )      |   | $      | (0.20     | )      |   | $ | (0.08 | ) |   | $ | 0.04 |   |   | $ | 0.04 |   |   | $ | (0.10 | ) |   | $ | 0.29 |   |   | $ | 0.28 |   |
| Net (Loss) Income Diluted                           |   |   | (0.20     | )      |   |   | (0.20     | )      |   |   | (0.08 | ) |   |   | 0.04 |   |   |   | 0.04 |   |   |   | (0.10 | ) |   |   | 0.29 |   |   |   | 0.28 |   |
| Dividends Declared                                  |   |   | 0.190     |   |   |   | 0.190     |   |   |   | 0.190 |   |   |   | 0.190 |   |   |   | 0.190 |   |   |   | 0.190 |   |   |   | 0.185 |   |   |   | 0.185 |   |
| Diluted Book Value                                  |   |   | 15.34     |   |   |   | 15.72     |   |   |   | 15.76 |   |   |   | 16.03 |   |   |   | 16.18 |   |   |   | 16.27 |   |   |   | 17.45 |   |   |   | 17.33 |   |
| Market Price:                                       |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| High                                                |   |   | 14.61     |   |   |   | 14.34     |   |   |   | 17.10 |   |   |   | 17.35 |   |   |   | 27.31 |   |   |   | 33.32 |   |   |   | 34.50 |   |   |   | 30.19 |   |
| Low                                                 |   |   | 11.57     |   |   |   | 11.00     |   |   |   | 13.92 |   |   |   | 11.01 |   |   |   | 9.50 |   |   |   | 21.06 |   |   |   | 19.20 |   |   |   | 21.76 |   |
| Close                                               |   |   | 14.25     |   |   |   | 13.84     |   |   |   | 14.20 |   |   |   | 16.85 |   |   |   | 11.46 |   |   |   | 27.24 |   |   |   | 31.35 |   |   |   | 21.76 |   |
|                                                |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selected Average                                    |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balances:                                           |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans                                               |   | $      | 1,886,367 |   |   | $      | 1,944,873 |   |   | $ | 1,964,984 |   |   | $ | 1,974,197 |   |   | $ | 1,964,086 |   |   | $ | 1,940,083 |   |   | $ | 1,915,008 |   |   | $ | 1,908,802 |   |
| Earning Assets                                      |   |   | 2,358,288 |   |   |   | 2,237,561 |   |   |   | 2,157,362 |   |   |   | 2,175,281 |   |   |   | 2,166,237 |   |   |   | 2,150,841 |   |   |   | 2,207,670 |   |   |   | 2,303,971 |   |
| Assets                                              |   |   | 2,698,419 |   |   |   | 2,575,250 |   |   |   | 2,497,969 |   |   |   | 2,506,352 |   |   |   | 2,486,925 |   |   |   | 2,463,318 |   |   |   | 2,528,638 |   |   |   | 2,634,771 |   |
| Deposits                                            |   |   | 2,248,760 |   |   |   | 2,090,008 |   |   |   | 1,950,170 |   |   |   | 1,971,190 |   |   |   | 1,957,354 |   |   |   | 1,945,866 |   |   |   | 2,030,684 |   |   |   | 2,140,545 |   |
| Shareowners’ Equity                           |   |   | 268,555   |   |   |   | 268,556   |   |   |   | 275,027 |   |   |   | 277,114 |   |   |   | 281,634 |   |   |   | 302,227 |   |   |   | 303,595 |   |   |   | 300,890 |   |
| Common Equivalent Shares:                           |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                               |   |   | 17,057    |   |   |   | 17,034    |   |   |   | 17,024 |   |   |   | 17,010 |   |   |   | 17,109 |   |   |   | 17,125 |   |   |   | 17,124 |   |   |   | 17,146 |   |
| Diluted                                             |   |   | 17,070    |   |   |   | 17,035    |   |   |   | 17,025 |   |   |   | 17,010 |   |   |   | 17,131 |   |   |   | 17,135 |   |   |   | 17,128 |   |   |   | 17,147 |   |
|                                                |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Ratios:                                             |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| ROA                                                 |   |   | (0.52     | )%     |   |   | (0.52     | )%     |   |   | (0.24 | )% |   |   | 0.12 | % |   |   | 0.11 | % |   |   | (0.28 | )% |   |   | 0.76 | % |   |   | 0.73 | % |
| ROE                                                 |   |   | (5.23     | )%     |   |   | (5.03     | )%     |   |   | (2.15 | )% |   |   | 1.12 | % |   |   | 0.94 | % |   |   | (2.24 | )% |   |   | 6.34 | % |   |   | 6.43 | % |
| Net Interest Margin (FTE)                           |   |   | 4.21      | %      |   |   | 4.59      | %      |   |   | 4.99 | % |   |   | 5.11 | % |   |   | 5.16 | % |   |   | 5.26 | % |   |   | 5.01 | % |   |   | 4.90 | % |
| Efficiency Ratio                                    |   |   | 85.00     | %      |   |   | 85.21     | %      |   |   | 73.86 | % |   |   | 75.44 | % |   |   | 75.07 | % |   |   | 71.21 | % |   |   | 59.27 | % |   |   | 66.89 | % |

| (1) | Includes a $6.25 million ($3.8 million after-tax) one-time gain on sale of a portion of our merchant services portfolio. |
|-----|--------------------------------------------------------------------------------------------------------------------------|

----

| Item 2. | MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
|---------|---------------------------------------------------------------------------------------|

|                                      |   | Three Months Ended |   |
|-------------------------------------------|--------|--------------------|--------|
|                                      |   | March 31, 2010     |   |   | December 31,2009 |   |   | March 31,2009 |   |
| Efficiency ratio                          |   |               | 86.85  | % |   |   | 87.72 | % |   |   | 77.50 | % |
| Effect of intangible amortization expense |   |               | (1.85  | )% |   |   | (2.51 | )% |   |   | (2.43 | )% |
| Operating efficiency ratio                |   |               | 85.00  | % |   |   | 85.21 | % |   |   | 75.07 | % |

|                                                             |   | Three Months Ended |   |
|------------------------------------------------------------------|--------|--------------------|--------|
|                                                             |   | March 31,2010      |   |   | December 31,2009 |   |   | March 31,2009 |   |
| Net noninterest expense as a percent of average assets           |   |               | 2.92   | % |   |   | 3.22 | % |   |   | 2.97 | % |
| Effect of intangible amortization expense                        |   |               | (0.11  | )% |   |   | (0.16 | )% |   |   | (0.16 | )% |
| Operating net noninterest expense as a percent of average assets |   |               | 2.81   | % |   |   | 3.06 | % |   |   | 2.81 | % |

----

----

| ·   | Net loss of $3.4 million, or $0.20 per diluted share for the first quarter of 2010 compared to a net loss of $3.4 million, or $0.20 per diluted share in the fourth quarter of 2009, and net income of $0.7 million, or $0.04 per diluted share for the first quarter of 2009. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Our loan loss provisions were $10.7 million ($0.39 per share), $10.8 million ($0.39 per share), and $8.4 million ($0.30 per share) for the quarters ended March 31, 2010, December 31, 2009, and March 31, 2009, respectively.  Provision for the current quarter reflects required reserves for newly impaired loans and to a lesser extent collateral devaluation on existing impaired loans. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Tax equivalent net interest income for the first quarter of 2010 decreased $1.4 million, or 5.3% from the fourth quarter of 2009 and $3.1 million, or 11.3% compared to the first quarter of 2009 due to a shift in the earning asset mix and unfavorable asset repricing, partially offset by a lower level of foregone interest on nonperforming loans.  Additionally, interest expense declined from the fourth quarter but was slightly higher when compared to the first quarter of 2009. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Noninterest income decreased $0.4 million or 3.1% from the fourth quarter of 2009 and decreased $0.1 million, or 0.5%, from the first quarter of 2009.  Lower deposit fees and retail brokerage fees drove the decline from the linked quarter while a lower level of merchant fees, due to lower processing volume, was the primary reason for reduction from the comparable prior year quarter. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Noninterest expense decreased $1.9 million, or 5.5%, from the fourth quarter of 2009 and increased $1.1 million, or 3.5%, from the first quarter of 2009.  Lower expense for other real estate owned properties, legal fees, professional fees, advertising fees, and intangible amortization contributed to the linked quarter decline.  Higher expense for other real estate owned properties partially offset by lower pension expense drove the increase over the comparable prior year quarter. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Average earnings assets increased $120.7 million, or 5.4%, from the fourth quarter of 2009 and increased $192.1 million, or 8.9%, from the comparable prior year quarter.  The increase from the linked quarter was primarily attributable to a $190.5 million increase in the funds sold position driven by core deposit growth and to a lesser extent an influx of public funds.  The average investment and loan portfolios declined $11.3 million and $58.5 million, respectively.  Approximately one-half of the reduction in the loan portfolio was attributable to loan charge-offs and transfer of foreclosed properties to the other real estate owned category.  The increase in earning assets over the prior year quarter is attributable to the same aforementioned factors. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Nonperforming assets totaled $153.7 million at the end of the first quarter, an increase of $9.6 million over year-end 2009 and $26.9 million over the first quarter of 2009.  Nonperforming assets represented 8.10% of loans and other real estate at the end of the first quarter compared to 7.38% at year-end 2009 and 6.39% at the end of the first quarter of 2009.  The increase in nonperforming assets for the current quarter was driven by a higher level of restructured loans, which increased $9.2 million from year-end 2009, consisting primarily of four large loan relationships. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | As of March 31, 2010, we are well-capitalized with a risk based capital ratio of 14.16% and a tangible capital ratio of 6.62% compared to 14.11% and 6.84%, respectively, at year-end 2009 and 14.40% and 7.63%, respectively, at March 31, 2009. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                |   | Three Months Ended  |
|-----------------------------------------------------|--------|---------------------|
| (Dollars in Thousands, except per share data)       |   | March 31, 2010 |   |   | December 31, 2009 |   |   | March 31, 2009 |   |
| Interest Income                                     |   | $              | 28,154 |   |   | $  | 29,756 |   |   | $  | 31,053 |   |
| Taxable equivalent Adjustments                      |   |                | 451 |   |   |   | 553 |   |   |   | 583 |   |
| Total Interest Income (FTE)                         |   |                | 28,605 |   |   |   | 30,309 |   |   |   | 31,636 |   |
| Interest Expense                                    |   |                | 4,132 |   |   |   | 4,464 |   |   |   | 4,058 |   |
| Net Interest Income (FTE)                           |   |                | 24,473 |   |   |   | 25,845 |   |   |   | 27,578 |   |
| Provision for Loan Losses                           |   |                | 10,740 |   |   |   | 10,834 |   |   |   | 8,410 |   |
| Taxable Equivalent Adjustments                      |   |                | 451 |   |   |   | 553 |   |   |   | 583 |   |
| Net Interest Income After provision for Loan Losses |   |                | 13,282 |   |   |   | 14,458 |   |   |   | 18,585 |   |
| Noninterest Income                                  |   |                | 13,967 |   |   |   | 14,411 |   |   |   | 14,042 |   |
| Noninterest Expense                                 |   |                | 33,384 |   |   |   | 35,313 |   |   |   | 32,257 |   |
| (Loss) Income Before Income Taxes                   |   |                | (6,135 | ) |   |   | (6,444 | ) |   |   | 370 |   |
| Income Tax (Benefit) Expense                        |   |                | (2,672 | ) |   |   | (3,037 | ) |   |   | (280 | ) |
| Net (Loss) Income                                   |   | $              | (3,463 | ) |   | $  | (3,407 | ) |   | $  | 650 |   |
|                                                |   |                |   |   |   |   |   |   |   |   |   |   |
| Basic Net (Loss) Income Per Share                   |   | $                   | (0.20 | ) |   | $ | (0.20 | ) |   | $ | 0.04 |   |
| Diluted Net (Loss) Income Per Share                 |   | $                   | (0.20 | ) |   | $ | (0.20 | ) |   | $ | 0.04 |   |
|                                                |   |                |   |   |   |   |   |   |   |   |   |   |
| Return on Average Equity                            |   |                | (0.52 | )% |   |   | (0.52 | )% |   |   | 0.11 | % |
| Return on Average Assets                            |   |                | (5.23 | )% |   |   | (5.03 | )% |   |   | 0.94 | % |

----

|                                          |   | Three Months Ended |   |
|-----------------------------------------------|--------|--------------------|--------|
| (Dollars in Thousands, except per share data) |   | March 31, 2010     |   |   | December 31, 2009 |   |   | March 31, 2009 |   |
|                                          |   |               |   |   |   |   |   |   |   |
| CHARGE-OFFS                                   |   |               |   |   |   |   |   |   |   |
| Commercial, Financial and Agricultural        |   |  $            | 842    |   |   |  $ | 712 |   |   |  $ | 857 |   |
| Real Estate – Construction              |   |               | 3,722  |   |   |   | 2,040 |   |   |   | 320 |   |
| Real Estate – Commercial Mortgage       |   |               | 4,631  |   |   |   | 1,584 |   |   |   | 1,002 |   |
| Real Estate – Residential               |   |               | 3,727  |   |   |   | 7,377 |   |   |   | 1,975 |   |
| Consumer                                      |   |               | 1,507  |   |   |   | 1,324 |   |   |   | 2,117 |   |
| Total Charge-offs                             |   |               | 14,429 |   |   |   | 13,037 |   |   |   | 6,271 |   |
|                                          |   |               |   |   |   |   |   |   |   |   |   |   |
| RECOVERIES                                    |   |               |   |   |   |   |   |   |   |   |   |   |
| Commercial, Financial and Agricultural        |   |               | 77     |   |   |   | 343 |   |   |   | 74 |   |
| Real Estate – Construction              |   |               | -      |   |   |   | 5 |   |   |   | 385 |   |
| Real Estate – Commercial Mortgage       |   |               | 157    |   |   |   | 43 |   |   |   | - |   |
| Real Estate – Residential               |   |               | 114    |   |   |   | 331 |   |   |   | 58 |   |
| Consumer                                      |   |               | 545    |   |   |   | 471 |   |   |   | 512 |   |
| Total Recoveries                              |   |               | 893    |   |   |   | 1,193 |   |   |   | 1,029 |   |
|                                          |   |               |   |   |   |   |   |   |   |   |   |   |
| Net Charge-offs                               |   |  $            | 13,536 |   |   |  $ | 11,844 |   |   |  $ | 5,242 |   |
| Net Charge- offs ( Annualized)                |   |               | 2.91   | % |   |   | 2.42 | % |   |   | 1.08 | % |
|    as a percent of Average     |   |               |   |   |   |   |   |   |   |   |   |   |
|    Loans Outstanding, Net of   |   |               |   |   |   |   |   |   |   |   |   |   |
|    Unearned Interest           |   |               |   |   |   |   |   |   |   |   |   |   |

----

|                                |   |               |   |             |    |   |
|-------------------------------------|--------|--------------------|--------|------------------|---------|--------|
|                                |   | Three Months Ended |   |
| (Dollars in Thousands)              |   | March 31,2010      |   | December 31,2009 |    |   | March 31, 2009 |   |
|                                |   |               |   |             |    |   |   |
| Noninterest Income:                 |   |               |   |             |    |   |   |
| Service Charges on Deposit Accounts |   |  $            | 6,628  |             |  $ | 7,183  |   |  $ | 6,698 |   |
| Data Processing Fees                |   |               | 900    |             |    | 948    |   |   | 870 |   |
| Asset Management Fees               |   |               | 1,020  |             |    | 1,065  |   |   | 970 |   |
| Retail Brokerage Fees               |   |               | 565    |             |    | 772    |   |   | 493 |   |
| Investment Security Gains           |   |               | 5      |             |    | -      |   |   | - |   |
| Mortgage Banking Fees               |   |               | 508    |             |    | 550    |   |   | 584 |   |
| Merchant Service Fees (1)           |   |               | 665    |             |    | 345    |   |   | 958 |   |
| Interchange Fees (1)                |   |               | 1,212  |             |    | 1,129  |   |   | 1,056 |   |
| ATM/Debit Card Fees (1)             |   |               | 963    |             |    | 892    |   |   | 863 |   |
| Other                               |   |               | 1,501  |             |    | 1,527  |   |   | 1,550 |   |
|                                |   |               |   |             |    |   |   |   |   |   |
| Total Noninterest Income            |   |  $            | 13,967 |             |  $ | 14,411 |   |  $ | 14,042 |   |

----

|                            |   | Three Months Ended |         |
|---------------------------------|--------|--------------------|--------------|
| (Dollars in Thousands)          |   | March 31, 2010     |         | December 31, 2009 |   | March 31, 2009 |   |
|                            |   |               |         |   |   |   |   |
| Noninterest Expense:            |   |               |         |   |   |   |   |
| Salaries                        |   |  $            | 13,049       |   |   |  $ | 12,413 |   |  $ | 13,141 |   |
| Associate Benefits              |   |               | 3,730        |   |   |   | 3,708 |   |   | 4,096 |   |
| Total Compensation              |   |               | 16,779       |   |   |   | 16,121 |   |   | 17,237 |   |
|                            |   |               |         |   |   |   |   |   |   |   |   |
| Premises                        |   |               | 2,408        |   |   |   | 2,458 |   |   | 2,345 |   |
| Equipment                       |   |               | 2,181        |   |   |   | 2,261 |   |   | 2,338 |   |
| Total Occupancy                 |   |               | 4,589        |   |   |   | 4,719 |   |   | 4,683 |   |
|                            |   |               |         |   |   |   |   |   |   |   |   |
| Legal Fees                      |   |               | 1,046        |   |   |   | 1,261 |   |   | 839 |   |
| Professional Fees               |   |               | 1,048        |   |   |   | 1,602 |   |   | 960 |   |
| Processing Services             |   |               | 887          |   |   |   | 899 |   |   | 908 |   |
| Advertising                     |   |               | 678          |   |   |   | 950 |   |   | 856 |   |
| Travel and Entertainment        |   |               | 232          |   |   |   | 296 |   |   | 295 |   |
| Printing and Supplies           |   |               | 404          |   |   |   | 450 |   |   | 477 |   |
| Telephone                       |   |               | 550          |   |   |   | 568 |   |   | 569 |   |
| Postage                         |   |               | 447          |   |   |   | 441 |   |   | 418 |   |
| Insurance - Other               |   |               | 1,188        |   |   |   | 1,088 |   |   | 866 |   |
| Intangible Amortization         |   |               | 710          |   |   |   | 1,011 |   |   | 1,011 |   |
| Interchange Fees                |   |               | 554          |   |   |   | 346 |   |   | 737 |   |
| Courier Service                 |   |               | 116          |   |   |   | 116 |   |   | 138 |   |
| Other Real Estate Owned         |   |               | 2,515        |   |   |   | 3,205 |   |   | 747 |   |
| Miscellaneous                   |   |               | 1,641        |   |   |   | 2,240 |   |   | 1,516 |   |
| Total Other                     |   |               | 12,016       |   |   |   | 14,473 |   |   | 10,337 |   |
|                            |   |               |         |   |   |   |   |   |   |   |   |
| Total Noninterest Expense  |   |  $            | 33,384  |   |   |  $ | 35,313  |   |  $ | 32,257  |   |

----

----

----

----

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

| Changes in Interest Rates | +300 bp | +200 bp | +100 bp | -100 bp          |
|---------------------------|---------|---------|---------|------------------|
|                      |    |    |    |             |
| Policy Limit (±)     | 10.0%   | 7.5%    | 5.0%    |   5.0% |
| March 31, 2010            | -8.1%   | -4.6%   | -1.3%   | -1.0%            |
| December 31, 2009         | -6.1%   | -3.4%   | -0.8%   | 0.7%             |

| Changes in Interest Rates | +300 bp | +200 bp | +100 bp | -100 bp          |   |
|---------------------------|---------|---------|---------|------------------|--------|
|                      |    |    |    |             |   |
| Policy Limit (±)     | 12.5%   | 10.0%   | 7.5%    |   7.5% |   |
| March 31, 2010            | -6.2%   | -0.7%   | 2.1%    |  -5.9%      |   |
| December 31, 2009         | -4.3%   | 0.4%    | 2.7%    | -7.0%            |   |
|                      |    |    |    |             |   |
|                      |    |    |    |             |   |

| (1) | Down 200 and 300 rate scenarios have been excluded due to the current historically low interest rate environment. |
|-----|-------------------------------------------------------------------------------------------------------------------|

----

----

----

----

|                                              |           |  Three Months Ended |   |
|---------------------------------------------------|----------------|--------------------------|--------|
| (Taxable Equivalent Basis - Dollars in Thousands) | March 31, 2010 |                     |   | December 31, 2009 |   |   | March 31, 2009 |   |
| ASSETS                                            |           | Balance                  |   |   | Interest |   |   |   | Rate |   |   | Balance |   |   | Interest |   |   | Rate |   |   |  Balance |   |   |  Interest |   |   | Rate |   |
| Loans, Net of Unearned Interest(1)(2)             | $              | 1,886,367                |   | $ | 27,180 |   |   |   | 5.84 | % |   | $ | 1,944,873 |   |   | $ | 28,813 |   |   |   | 5.88 | % |   | $ | 1,964,086 |   |   | $ | 29,724 |   |   |   | 6.14 | % |
| Taxable Investment Securities                     |           | 71,325                   |   |   | 500 |   |   |   | 2.81 |   |   |   | 72,537 |   |   |   | 498 |   |   |   | 2.74 |   |   |   | 90,927 |   |   |   | 776 |   |   |   | 3.43 |   |
| Tax-Exempt Investment Securities(2)               |           | 97,316                   |   |   | 753 |   |   |   | 3.10 |   |   |   | 107,361 |   |   |   | 921 |   |   |   | 3.43 |   |   |   | 101,108 |   |   |   | 1,133 |   |   |   | 4.48 |   |
| Funds Sold                                        |           | 303,280                  |   |   | 172 |   |   |   | 0.23 |   |   |   | 112,790 |   |   |   | 77 |   |   |   | 0.27 |   |   |   | 10,116 |   |   |   | 3 |   |   |   | 0.13 |   |
| Total Earning Assets                              |           | 2,358,288                |   |   | 28,605 |   |   |   | 4.92 | % |   |   | 2,237,561 |   |   |   | 30,309 |   |   |   | 5.38 | % |   |   | 2,166,237 |   |   |   | 31,636 |   |   |   | 5.92 | % |
| Cash and Due From Banks                           |           | 54,873                   |   |   |   |   |   |   |   |   |   |   | 69,687 |   |   |   |   |   |   |   |   |   |   |   | 76,826 |   |   |   |   |   |   |   |   |   |
| Allowance for Loan Losses                         |           | (44,584                  | )      |   |   |   |   |   |   |   |   |   | (46,468 | ) |   |   |   |   |   |   |   |   |   |   | (38,007 | ) |   |   |   |   |   |   |   |   |
| Other Assets                                      |           | 329,842                  |   |   |   |   |   |   |   |   |   |   | 314,470 |   |   |   |   |   |   |   |   |   |   |   | 281,869 |   |   |   |   |   |   |   |   |   |
| TOTAL ASSETS                                      | $              | 2,698,419                |   |   |   |   |   |   |   |   |   | $ | 2,575,250 |   |   |   |   |   |   |   |   |   |   | $ | 2,486,925 |   |   |   |   |   |   |   |   |   |
|                                              |           |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES                                       |           |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NOW Accounts                                      | $              | 867,004                  |   | $ | 384 |   |   |   | 0.18 | % |   | $ | 740,550 |   |   | $ | 308 |   |   |   | 0.17 | % |   | $ | 719,265 |   |   | $ | 225 |   |   |   | 0.13 | % |
| Money Market Accounts                             |           | 374,161                  |   |   | 689 |   |   |   | 0.75 |   |   |   | 361,104 |   |   |   | 625 |   |   |   | 0.69 |   |   |   | 321,562 |   |   |   | 190 |   |   |   | 0.24 |   |
| Savings Accounts                                  |           | 126,352                  |   |   | 15 |   |   |   | 0.05 |   |   |   | 122,158 |   |   |   | 16 |   |   |   | 0.05 |   |   |   | 118,142 |   |   |   | 14 |   |   |   | 0.05 |   |
| Other Time Deposits                               |           | 438,112                  |   |   | 1,850 |   |   |   | 1.71 |   |   |   | 439,654 |   |   |   | 2,015 |   |   |   | 1.82 |   |   |   | 392,006 |   |   |   | 2,066 |   |   |   | 2.14 |   |
| Total Interest Bearing Deposits                   |           | 1,805,629                |   |   | 2,938 |   |   |   | 0.66 |   |   |   | 1,663,466 |   |   |   | 2,964 |   |   |   | 0.71 |   |   |   | 1,550,975 |   |   |   | 2,495 |   |   |   | 0.65 |   |
| Short-Term Borrowings                             |           | 30,673                   |   |   | 17 |   |   |   | 0.22 |   |   |   | 47,114 |   |   |   | 22 |   |   |   | 0.18 |   |   |   | 85,318 |   |   |   | 68 |   |   |   | 0.32 |   |
| Subordinated Notes Payable                        |           | 62,887                   |   |   | 651 |   |   |   | 4.14 |   |   |   | 62,887 |   |   |   | 936 |   |   |   | 5.83 |   |   |   | 62,887 |   |   |   | 927 |   |   |   | 5.89 |   |
| Other Long-Term Borrowings                        |           | 49,981                   |   |   | 526 |   |   |   | 4.27 |   |   |   | 50,026 |   |   |   | 542 |   |   |   | 4.30 |   |   |   | 53,221 |   |   |   | 568 |   |   |   | 4.33 |   |
| Total Interest Bearing Liabilities                |           | 1,949,170                |   |   | 4,132 |   |   |   | 0.86 | % |   |   | 1,823,493 |   |   |   | 4,464 |   |   |   | 0.97 | % |   |   | 1,752,401 |   |   |   | 4,058 |   |   |   | 0.94 | % |
| Noninterest Bearing Deposits                      |           | 443,131                  |   |   |   |   |   |   |   |   |   |   | 426,542 |   |   |   |   |   |   |   |   |   |   |   | 406,380 |   |   |   |   |   |   |   |   |   |
| Other Liabilities                                 |           | 37,563                   |   |   |   |   |   |   |   |   |   |   | 56,659 |   |   |   |   |   |   |   |   |   |   |   | 46,510 |   |   |   |   |   |   |   |   |   |
| TOTAL LIABILITIES                                 |           | 2,429,864                |   |   |   |   |   |   |   |   |   |   | 2,306,694 |   |   |   |   |   |   |   |   |   |   |   | 2,205,291 |   |   |   |   |   |   |   |   |   |
|                                              |           |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| SHAREOWNERS' EQUITY                               |           |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| TOTAL SHAREOWNERS' EQUITY                         |           | 268,555                  |   |   |   |   |   |   |   |   |   |   | 268,556 |   |   |   |   |   |   |   |   |   |   |   | 281,634 |   |   |   |   |   |   |   |   |   |
|                                              |           |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| TOTAL LIABILITIES & EQUITY                    | $              | 2,698,419                |   |   |   |   |   |   |   |   |   | $ | 2,575,250 |   |   |   |   |   |   |   |   |   |   | $ | 2,486,925 |   |   |   |   |   |   |   |   |   |
|                                              |           |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Rate Spread                              |           |                     |   |   |   |   |   |   | 4.06 | % |   |   |   |   |   |   |   |   |   |   | 4.41 | % |   |   |   |   |   |   |   |   |   |   | 4.98 | % |
| Net Interest Income                               |           |                     |   | $ | 24,473 |   |   |   |   |   |   |   |   |   |   | $ | 25,845 |   |   |   |   |   |   |   |   |   |   | $ | 27,578 |   |   |   |   |   |
| Net Interest Margin(3)                            |           |                     |   |   |   |   |   |   | 4.21 | % |   |   |   |   |   |   |   |   |   |   | 4.59 | % |   |   |   |   |   |   |   |   |   |   | 5.16 | % |

|  (1) | Average balances include nonaccrual loans.  Interest income includes fees on loans of $363,000 and $481,000, for the three months ended March 31, 2010 and 2009. |
|-----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Interest income includes the effects of taxable equivalent adjustments using a 35% tax rate. |
|-----|----------------------------------------------------------------------------------------------|

| (3) | Taxable equivalent net interest income divided by average earning assets. |
|-----|---------------------------------------------------------------------------|

----

| 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. | Unregistered Sales of Equity Securities and Use of Proceeds |
|---------|-------------------------------------------------------------|

| Item 3. | Defaults Upon Senior Securities |
|---------|---------------------------------|

| Item 4. | Removed and Reserved |
|---------|----------------------|

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

----

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

| (A) | Exhibits |
|-----|----------|

| 31.1 | Certification of William G. Smith, Jr., Chairman, President and Chief Executive Officer of Capital City Bank Group, Inc., Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.2 | Certification of J. Kimbrough Davis, Executive Vice President and Chief Financial Officer of Capital City Bank Group, Inc., Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.1 | Certification of William G. Smith, Jr., Chairman, President and Chief Executive Officer of Capital City Bank Group, Inc., Pursuant to 18 U.S.C. Section 1350. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.2   | Certification of J. Kimbrough Davis, Executive Vice President and Chief Financial Officer of Capital City Bank Group, Inc., Pursuant to 18 U.S.C. Section 1350. |
|------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

SIGNATURES

| By: /s/ J. Kimbrough Davis                                                                                      |   |
|-----------------------------------------------------------------------------------------------------------------|--------|
| J. Kimbrough Davis                                                                                              |   |
| Executive Vice President and Chief Financial Officer                                                            |   |
| (Mr. Davis is the Principal Financial Officer and has been duly authorized to sign on behalf of the Registrant) |   |
|                                                                                                            |   |
| Date: May 7, 2010                                                                                          |   |