|UNITED STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
D.C. 20549


FORM 10-QSB


(Mark One)
|------------------------------------------------------------------------------------------------------

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

|For the quarterly period ended March
31, 2001
|---------------------------------------------

|[_] |  | TRANSITION
REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- |  | ----------------------------------------------------------------------------------------

|For the transition period
from ____________________________


Commission file number:
333-68207


FIRST
COASTAL BANCSHARES
|--------------------------------------------------------------------------------------------------------------------------

|                                               | 
|---------------------------------------------- | 
|CALIFORNIA                                     | 
|(State or other jurisdiction of incorporation) | 
|                                              
|275 Main Street, El Segundo, California        | 
|(Address of principal executive offices)       | 

|Registrants telephone
number, including area code: (888) 295-2250



Not applicable(Former
name or former address, if changed since last report)


Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or 15(c) of the
Securities Exchange Act of 1934 during the preceding 12 months (of shorter period that
the registrant was required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days. Yes [X]   No [_]




APPLICABLE
ONLY TO CORPORATE ISSUERS


On May 5, 2001, there were
1,241,413 shares of First Coastal Bancshares Common Stock outstanding.
1
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|First
Coastal Bancshares
March 31,
2001


INDEX


PART I
 FINANCIAL INFORMATION
|--------------------------------------------------------------------------------

|                                                                          | PAGE
|------------------------------------------------------------------------- | ----
|Item 1  Financial Statements                                             |     
|Condensed Consolidated Balance Sheets at March 31, 2001 and               |     
|December 31, 2000                                                         |     
|Condensed Consolidated Statements of Condition for the Three              |     
|Months Ended March 31, 2001 and 2000                                      |     
|Condensed Consolidated Statements of Changes in Shareholders
Equity from |     
|January 1, 2000 through March 31, 2001                                    |     
|Condensed Consolidated Statements of Cash Flows for the Three             |     
|Months Ended March 31, 2001 and 2000                                      |     
|Notes to Consolidated Financial Statements                                |     
|Item 2  Managements Discussion and Analysis of Financial Condition and  |     
|Results of Operations                                                     |     
|                                                                          |     
|PART II  OTHER INFORMATION                                               |     
|                                                                          |     
|Item 1  Legal Proceedings                                                |     
|Item 2  Changes in Securities                                            |     
|Item 3  Defaults upon Senior Securities                                  |     
|Item 4  Submission of Matters to a Vote of Security Holders              |     
|Item 5  Other Information                                                |     
|Item 6  Exhibits and Reports on Form 8-K                                 |     

|2
|-

|Item 1 
Financial Statements



First
Coastal Bancshares and SubsidiariesCondensed
Consolidated Balance Sheets(Unaudited
 Dollar Amounts in Thousands)
|--------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                          | March 31,2001 | December 31,2000
|--------------------------------------------------------- | ------------- | ----------------
|Cash and Due From Bank                                    |               | $     5,926     
|Investment Securities, net                                |               | 28,740          
|Federal Reserve and Federal Home Loan Bank Stock, at Cost |               | 1,034           
|Loans                                                     |               | 83,934          
|Allowance for Loan Losses                                 |               | (1,048          
|                                                         
|NET LOANS                                                 |               | 82,886          
|                                                         
|Premises and Equipment, net                               |               | 656             
|Goodwill, net                                             |               | 4,947           
|Accrued Interest and Other Assets                         |               | 3,638           
|                                                         
|                                                          |               | $ 127,827       
|                                                         
|                                                         
|Noninterest-Bearing Deposits                              |               | $   31,669      
|Interest-Bearing Deposits                                 |               | 80,352          
|                                                         
|TOTAL DEPOSITS                                            |               | 112,021         
|                                                         
|Other Borrowings                                          |               | 848             
|Company Obligated Mandatorily Redeemable Preferred        |              
|Securities of Subsidiary Trust Holding Solely Junior      |              
|Subordinated Debentures                                   |               | 6,600           
|Accrued Interest and Other Liabilities                    |               | 1,168           
|                                                         
|TOTAL LIABILITIES                                         |               | 120,637         
|                                                         
|Preferred Stock                                           |               | 1,993           
|Common Stock                                              |               | 6,558           
|Accumulated Deficit                                       |               | (1,222          
|Accumulated Other Comprehensive Income                    |               | (139            
|                                                         
|TOTAL SHAREHOLDERS EQUITY                                |               | 7,190           
|                                                         
|                                                          |               | $ 127,827       
|                                                         

|3
|-

|Item 1 
Financial Statements  Continued



First
Coastal Bancshares and SubsidiariesCondensed
Consolidated Statements of Condition(Unaudited
 Dollar Amounts in Thousands, Except EPS)
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                          | For the Three Months EndedMarch 31,
|------------------------- | -----------------------------------
|
|Interest Income           |                                    
|Interest Expense          |                                    
|                         
|NET INTEREST INCOME       |                                    
|                         
|Provision for Loan Losses |                                    
|                         
|NET INTEREST INCOME AFTER |                                    
|PROVISION FOR LOAN LOSSES |                                    
|                         
|Noninterest Income        |                                    
|Noninterest Expense       |                                    
|                         
|LOSS BEFORE TAXES         |                                    
|                         
|Income Tax                |                                    
|                         
|NET LOSS                  |                                    
|                         
|Per Share Data:           |                                    
|Net Loss - Basic          |                                    
|Net Loss - Diluted        |                                    

|4
|-

|Item 1 
Financial Statements  Continued



First
Coastal Bancshares and Subsidiaries Condensed
Consolidated Statements of Changes in Shareholders Equity(Unaudited
 Dollar Amounts in Thousands)
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                             | PreferredStock | Amount | ComprehensiveIncome | AccumulatedDeficit | AccumulatedOtherComprehensiveIncome | Total
|---------------------------- | -------------- | ------ | ------------------- | ------------------ | ----------------------------------- | -----
|January 1, 2000              |                | $1,993 |                     | $6,527             |                                     |      
|                             |               
|Sale of Treasury Shares      |                |        |                     | 24                 |                                     |      
|Dividends - Preferred Stock  |                |        |                     |                    |                                     |      
|Comprehensive Income         |               
|Net Loss                     |                |        |                     |                    |                                     | $(177
|Change in Unrecognized Gains |               
|of Securities Available for  |               
|Sale, net of taxes of $530   |                |        |                     |                    |                                     | 762  
|                             |                |        |                     |                    |                                     |      
|Comprehensive Income         |                |        |                     |                    |                                     | $585 
|                             |                |        |                     |                    |                                     |      
|                             |                |        |                     |                    |                                     |      
|December 31, 2000            |                | 1,993  |                     | 6,551              |                                     |      
|                             |               
|Dividends  Preferred Stock  |               
|Sale of Treasury Shares      |                |        |                     | 7                  |                                     |      
|Dividends - Preferred Stock  |                |        |                     |                    |                                     |      
|Comprehensive Income         |               
|Net Loss                     |                |        |                     |                    |                                     | $(56 
|Change in Unrecognized Loss  |               
|of Securities Available for  |               
|Sale, net of Taxes of $215   |                |        |                     |                    |                                     | 309  
|                             |                |        |                     |                    |                                     |      
|Comprehensive Income         |                |        |                     |                    |                                     | $253 
|                             |                |        |                     |                    |                                     |      
|                             |                |        |                     |                    |                                     |      
|March 31, 2001               |                | $1,993 |                     | $6,558             |                                     |      
|                             |                |        |                     |                    |                                     |      

|5
|-

|Item 1 
Financial Statements  Continued



First
Coastal Bancshares and SubsidiariesCondensed
Consolidated Statements of Cash Flows(Unaudited
 Dollar Amounts in Thousands)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                       | For the Three Months EndedMarch 31,
|------------------------------------------------------ | -----------------------------------
|
|OPERATING ACTIVITIES                                   |                                    
|Net Loss                                               |                                    
|Adjustments to Reconcile Net Loss to                   |                                    
|Net Cash Used by Operating Activities:                 |                                    
|Depreciation and Amortization                          |                                    
|Provision for Loan Losses                              |                                    
|Other Items - Net                                      |                                    
|                                                      
|NET CASH PROVIDED (USED) BY                            |                                    
|OPERATING ACTIVITIES                                   |                                    
|INVESTING ACTIVITIES                                   |                                    
|Purchases of Investment Securities                     |                                    
|Sale and Maturities of Investment Securities           |                                    
|Net Change in Federal Reserve and Home Loan Bank Stock |                                    
|Net Change in Loans                                    |                                    
|Proceeds from the Sale of Other Real Estate Owned      |                                    
|Purchase of Premises and Equipment                     |                                    
|                                                      
|NET CASH PROVIDED                                      |                                    
|BY INVESTING ACTIVITIES                                |                                    
|FINANCING ACTIVITIES                                   |                                    
|Net Change in Deposits                                 |                                    
|Net Change in Other Borrowings                         |                                    
|Dividends                                              |                                    
|                                                      
|NET CASH (USED) PROVIDED                               |                                    
|BY FINANCING ACTIVITIES                                |                                    
|                                                      
|(DECREASE) INCREASE IN CASH                            |                                    
|AND CASH EQUIVALENTS                                   |                                    
|                                                      
|Cash and Cash Equivalents at Beginning of Period       |                                    
|                                                      
|CASH AND CASH EQUIVALENTS                              |                                    
|AT END OF PERIOD                                       |                                    
|                                                      

|6
|-

|Item 1 
Financial Statements  Continued



First
Coastal Bancshares and SubsidiariesNotes to
Consolidated Financial Statements


Note 1  Basis
of Presentation and Management Representation


The accompanying financial
information has been prepared in accordance with the Securities and Exchange
Commission rules and regulations for quarterly reporting and therefore does not
necessarily include all information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles. This information should be read in conjunction with the
Companys Form 10-KSB filed on March 30, 2001 and Form SB-2 filed on
February 12, 1999.


The consolidated financial
statements include First Coastal Bancshares and its wholly owned subsidiaries,
First Coastal Bank, N.A. (the Bank) and First Coastal Capital Trust.


Operating results for
interim periods are not necessarily indicative of operating results for an
entire fiscal year. In the opinion of management, the unaudited financial
information for the three-month period ended March 31, 2001 and 2000, reflect
all adjustments, consisting only of normal recurring accruals and provisions,
necessary for a fair presentation thereof.


Some matters discussed in
this Form 10-QSB may be forward-looking statements within the
meaning of the Private Litigation Reform Act of 1995 and therefore may involve
risks, uncertainties and other factors which may cause our actual results to be
materially different from the results expressed or implied by our
forward-looking statements. These statements generally appear with words such as
anticipate, believe, estimate,
may, intend, and expect.



Note 2 
Acquisition of American Independent Bank, N.A.


On March 8, 1999, the Bank
acquired 100% of the outstanding common stock of American Independent Bank, N.A.
(AIB) for approximately $6.5 million in cash. AIB had total assets of
approximately $38 million on March 8, 1999. The acquisition was accounted for
using the purchase method of accounting in accordance with Accounting Principles
Board Opinion No, 16. Business Combinations. Under this method of
accounting, the purchase price was allocated to the assets, deposits and
liabilities assumed based on their fair values as of the acquisition date, which
were not materially different from their book values. Goodwill arising from the
transaction totaled approximately $4.0 million and is being amortized over
fifteen years on a straight-line basis.



Note 3 
Earnings Per Share


Effective December 31,
1997, the Company adopted Statement of Financial Accounting Standards No. 128,
Earnings per Share. Accordingly, basic earnings per share are
computed by dividing income available to common shareholders by the weighted
average number of common shares outstanding during each period. The computation
of diluted earnings per share also considers the number of shares issuable upon
the assumed exercise of outstanding common stock options and the number of
shares issuable upon the assumed conversion of the convertible preferred stock.
These items were anti-dilutive for the periods reported and therefore dilutive
earnings per shares are reported as the same as basic earnings per share.
7
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Item 2  Managements
Discussion and Analysis of Financial Condition and Results of Operations




Income Summary


For the three months ended
March 31, 2001, the Company reported a net loss of $56,000, or $0.09 basic loss
per share compared to a net loss of $49,000, or $0.08 basic loss per share for
the same three-month period in 2000. The annualized return on average assets was
(0.17)% for 2001 compared to (0.15)% for 2000. Annualized return on average
shareholders equity for 2001 and 2000 was (3.16)% and (3.02)%,
respectively.



Net Interest
Income


Net interest income is the
amount by which the interest and amortization of fees generated from loans and
other earning assets exceed the cost of funding those assets, usually deposit
account interest expense. Net interest income depends on the difference (the
interest rate spread) between gross interest and fees earned on the
loans and investment portfolios and the interest rates paid on deposits and
borrowings. Net interest income was $1,319,000 for the quarter ended March 31,
2001, compared to $1,285,000 for the quarter ended March 31, 2000.


The total amount of net
interest income increased for the quarter ended March 31, 2001 compared to the
same period in 2000. This increase was primarily due to the repositioning of the
balance sheet in 2001 coupled with modest growth in interest-earning assets.


The following table sets
forth the components of net interest income, average earning assets and net
interest margin:
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                       | Three Months EndedMarch 31, | Year Ended
                                                                               December 31,
|---------------------- | --------------------------- | ------------------------------------------------------------------------------------------------------
|
|Interest Income        |                             | $    2,541                                                                                            
|Interest Expense       |                             | 1,222                                                                                                 
|                      
|Net Interest
Income    |                             | $    1,319                                                                                            
|                      
|Average Earning Assets |                             | $115,266                                                                                              
|Net Interest Margin    |                             | 4.58%                                                                                                 

|8
|-

|Provision for
Loan Losses


The Company made no
contribution to the allowance for loan losses in the first quarter of 2001. The
Company contributed $45,000 to the allowance for loan losses in the first
quarter of 2000. Management believes that the allowance, which stands at 1.3% of
total loans at March 31, 2001, is adequate to cover future losses.


Changes in the allowance
for loan losses for the quarter ended March 31, 2001 and 2000 are as follows
(dollar amounts in thousands):
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                | Quarter EndedMarch 31,
|------------------------------- | ----------------------
|
|Allowance, Beginning of Quarter |                       
|Provision for Loan Losses       |                       
|Recoveries on Loans Charged Off |                       
|                               
|                                |                       
|Less: Loans Charged Off         |                       
|                               
|Allowance, End of Quarter       |                       
|                               

|Non-Interest
Income


Non-Interest Income
represents deposit account service charges and other types of non-loan related
fee income. Non-interest income for the quarter ended March 31, 2001 totaled
$177,000 compared to $255,000 for the same period ended 2000. This represents a
decrease of $78,000. The decrease is primarily the result of a non-recurring
recovery of operational accruals realized in the first quarter of 2000.



Non-Interest
Expense


Non-Interest Expenses
represent salaries, occupancy expenses, professional expenses, outside services
and other miscellaneous expenses necessary to conduct business. Non-interest
expense for the quarter ended March 31, 2001 totaled $1,539,000 compared to
$1,508,000 for the same period during 2000.

9
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Income Taxes


The Companys income
tax provision for the first quarter of 2001 and 2000 was $13,000 and $36,000,
respectively, resulting in an effective rate of 41.0% on income before taxes and
goodwill amortization.



Balance Sheet
Analysis


Total assets at March 31,
2001 were $127.8 million, down 6.1% from the $135.7 million reported at December
31, 2000. This decrease was primarily due to the sale of approximately $10.0
million of investment securities coupled with a $10 million reduction in other
borrowings as a result of managements decision to strategically reposition
the balance sheet.



Asset Quality


The following table sets forth the
components of non-performing assets and related ratios: (dollar amounts in thousands)
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                  | March 31, | December 31,
|------------------------------------------------- | --------- | ------------
|
|Restructured Loans                                |           | $          
|Loans 90 day past due and still accruing          |           | 7           
|Loans on nonaccrual                               |           | 383         
|                                                 
|Nonperforming Loans                               |           | 390         
|Other real estate owned                           |           |            
|                                                 
|Nonperforming Assets                              |           | $  390      
|                                                 
|                                                 
|Nonperforming loans as a percent of total loans   |           | 0.46%       
|Allowance for loan losses as a percent            |          
|of nonperforming loans                            |           | 268.72%     
|Nonperforming assets as a percent of total assets |           | 0.31%       

|The primary ratios of loan
quality have not changed significantly in the first quarter of 2001.
Non-performing loans as a percent of total loans increased slightly to .46% at
March 31, 2001, compared to .38% at December 31, 2000. The allowance for loan
losses as a percent of nonperforming loans decreased to 268.72% at March 31,
2001, down from 303.14% at December 31, 2000.



Other
Borrowings


Other borrowings at March
31, 2001 consist of $848,000 in long-term borrowings from a correspondent
bank.
10
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Trust
Preferred Securities


During the first quarter of
1999 the Company completed an offering of $6.6 million in 11 7/8% Cumulative
Preferred Securities through a wholly owned subsidiary, First Coastal Capital
Trust. Under generally accepted accounting policies, the securities are reported
as liabilities of the Company and the interest payments and amortization of the
related costs of the offering ($1.0 million) are reported as interest expense.
The Trust Preferred Securities mature on December 31, 2028.



Capital


Total shareholders
equity at March 31, 2001 totaled $7.2 million, compared to $6.9 millionat December 31, 2000. This increase was primarily attributable to the
decrease in net unrealized loss on available-for-sale investments of $309,000.


The Bank maintains capital
ratios above the Federal regulatory guidelines for a
well-capitalized bank. The ratios are as follows:
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                         | Ratio | March 31,2001 | December 31,2000
|---------------------------------------- | ----- | ------------- | ----------------
|Tier 1 Capital (to Average Assets)       |       | 5.00          | %               
|Tier 1 Capital (to Risk Weighted Assets) |       | 6.00          | %               
|Total Captial (to Risk Weighted Assets)  |       | 10.00         | %               

|The Companys ratios
at March 31, 2001 were 4.41% for Tier 1 capital to risk-weighted assets and
11.20% for Total capital to risk-weighted assets.



Liquidity


Management is not aware of
any future capital expenditures or other significant demands on commitments that
would severely impair liquidity.


11
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|PART II 
OTHER INFORMATION



Item
1  Legal Proceedings
|---------------------------------------------------------

| | Due
to the nature of the banking business, the Company is at times party to various legal
actions; all such actions are of a routine nature and arise in the normal course of
business.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Item 2
 Changes in Securities



None



Item 3
 Defaults upon Senior Securities



None



Item 4
 Submission of Matters to a Vote of Security Holders



None



Item 5
 Other Items



None



Item 6
 Exhibits and Reports on Form 8-K
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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

| | None
| | ----

| |  | B) |  | Reports
on Form 8-K
| |  | -- |  | -------------------

| | None
| | ----

|12
|--

|Signatures


Pursuant to the requirement
of the Securities and Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned thereunto duly authorized.
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | First Coastal Bancshares
| |  | ------------------------

|Date:      May 11, 2001 |  | /s/ Don M. Griffith
Don M. GriffithChief Executive Officer,Chairman and Director
|----------------------- |  | ----------------------------------------------------------------------------------------------

|Date:      May 11, 2001 |  | /s/ Deborah A. Marsten
Deborah A. MarstenChief Financial Officer,Secretary and Director
|----------------------- |  | -----------------------------------------------------------------------------------------------------

|13
|--