|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, 2000
|---------------------------------------------

|[_] |  | 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) | NO. 95-4693574(IRS Employer Identification No.)
|-------------------------------------------------------- | -----------------------------------------------

|275 Main Street, El Segundo, California(Address of principal executive offices) | 90245(Zip Code)
|------------------------------------------------------------------------------- | ---------------

|Registrants telephone number, including area
code: (310) 322-2222


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, 2000, there were 1,232,428 shares of First Coastal
Bancshares Common Stock outstanding.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|First Coastal BancsharesMarch 31, 2000


INDEX


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

|                                                                          | 
|------------------------------------------------------------------------- | 
|Item 1  Financial Statements                                             | 
|Condensed Consolidated Balance Sheets at March 31, 2000 and               | 
|December 31, 1999                                                         | 
|Condensed Consolidated Statements of Income for the Three                 | 
|Months Ended March 31, 2000 and 1999                                      | 
|Condensed Consolidated Statements of Changes in Shareholders' Equity from | 
|January 1, 1999 through March 31, 2000                                    | 
|Condensed Consolidated Statements of Cash Flows for the Three             | 
|Months Ended March 31, 2000 and 1999                                      | 
|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                                 | 

|Item 1  Financial Statements


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

|                                                          | March 31,2000 | December 31,1999
|--------------------------------------------------------- | ------------- | ----------------
|Cash and Due From Bank                                    |               | $7,674          
|Short Term Investments                                    |               | 6,000           
|                                                         
|CASH AND CASH EQUIVALENTS                                 |               | 13,674          
|Investment Securities, net                                |               | 38,100          
|Federal Reserve and Federal Home Loan Bank Stock, at Cost |               | 1,604           
|Loans                                                     |               | 71,549          
|Allowance for Loan Losses                                 |               | (994            
|                                                         
|NET LOANS                                                 |               | 70,555          
|Premises and Equipment, net                               |               | 622             
|Other Real Estate Owned, net                              |               | --              
|Goodwill, net                                             |               | 5,352           
|Accrued Interest and Other Assets                         |               | 3,810           
|                                                         
|                                                          |               | $133,717        
|                                                         
|Noninterest-Bearing Deposits                              |               | $33,903         
|Interest-Bearing Deposits                                 |               | 64,839          
|                                                         
|TOTAL DEPOSITS                                            |               | 98,742          
|Other Borrowings                                          |               | 21,935          
|Company Obligated Mandatorily Redeemable Preferred        |              
|Securities of Subsidiary Trust Holding Solely Junior      |              
|Subordinated Debentures                                   |               | 6,600           
|Accrued Interest and Other Liabilities                    |               | 50              
|                                                         
|TOTAL LIABILITIES                                         |               | 127,327         
|Preferred Stock                                           |               | 1,993           
|Common Stock                                              |               | 6,527           
|Accumulated Deficit                                       |               | (824            
|                                                         
|Accumulated Other Comprehensive Income                    |               | (1,306          
|                                                         
|TOTAL SHAREHOLDERS' EQUITY                                |               | 6,390           
|                                                         
|                                                          |               | $133,717        
|                                                         

|Item 1  Financial Statements  Continued


First Coastal Bancshares and Subsidiaries
Condensed Consolidated Statements of Income(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 (Benefit)      |                                    
|                         
|NET LOSS                  |                                    
|                         
|Per Share Data:           |                                    
|Net Income - Basic        |                                    
|Net Income - Diluted      |                                    

|Item 1  Financial Statements  Continued


First Coastal Bancshares and SubsidiariesCondensed Consolidated Statements of Changes
in Shareholders' Equity(Unaudited  Dollar Amounts in Thousands)
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                  | PreferredStock | Amount | ComprehensiveIncome | AccumulatedDeficit | AccumulatedOtherComprehensiveIncome | Total  
|--------------------------------- | -------------- | ------ | ------------------- | ------------------ | ----------------------------------- | -------
|January 1, 1999                   |                | $2,658 |                     | $3,673             |                                     |        
|Redemption of Preferred Stock     |                | (586   | )                   |                    |                                     |        
|Conversion of Preferred to        |               
|Common Stock                      |                | (79    | )                   | 79                 |                                     |        
|Sale of Treasury Shares           |                |        |                     | 115                |                                     |        
|Net Proceeds from Stock Offering  |                |        |                     | 1,901              |                                     |        
|Dividends - Preferred Stock       |                |        |                     |                    |                                     |        
|Common Stock Repurchased          |                |        |                     | (116               | )                                   |        
|Exercise of Warrants              |                |        |                     | 875                |                                     |        
|Comprehensive Income              |               
|Net Loss                          |                |        |                     |                    |                                     | $(391  
|Change in Unrecognized Loss       |               
|of Securities Available for       |               
|Sale, net of taxes of $812        |                |        |                     |                    |                                     | (1,166 
|Less Reclassification Adjustments |               
|for Gains included in Net Loss    |               
|net of taxes of $9                |                |        |                     |                    |                                     | (13    
|                                 
|Comprehensive Income              |                |        |                     |                    |                                     | $(1,570
|                                 
|December 31, 1999                 |                | 1,993  |                     | 6,527              |                                     |        
|Dividends - Preferred Stock       |                |        |                     |                    |                                     |        
|Comprehensive Income              |               
|Net Loss                          |                |        |                     |                    |                                     | $(49   
|Change in Unrecognized Loss       |               
|of Securities Available for       |               
|Sale, net of Taxes of $66         |                |        |                     |                    |                                     | (96    
|                                 
|Comprehensive Income              |                |        |                     |                    |                                     | $(145  
|                                 
|March 31, 2000                    |                | $1,993 |                     | $6,527             |                                     |        
|                                 

|Item 1  Financial Statements  Continued


First Coastal Bancshares and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited  Dollar Amounts in Thousands)
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                        | For the Three Months Ended March 31, |        
|------------------------------------------------------- | ------------------------------------ | -------
|
|OPERATING ACTIVITIES                                    |                                      |        
|Net Loss                                                |                                      | $(49   
|Adjustments to Reconcile Net Loss to                    |                                     
|Net Cash Used by Operating Activities:                  |                                     
|Depreciation and Amortization                           |                                      | 159    
|Provision for Loan Losses                               |                                      | 45     
|Other Items - Net                                       |                                      | (835   
|                                                       
|NET CASH USED BY                                        |                                     
|OPERATING ACTIVITIES                                    |                                      | (680   
|INVESTING ACTIVITIES                                    |                                     
|Purchases of Investment Securities                      |                                      | --     
|Sale and Maturities of Investment Securities            |                                      | 256    
|Net Change in Federal Reserve and Home Loan Bank Stock  |                                      | (7     
|Net Cash and Cash Equivalents from AIB Acquisition      |                                      | --     
|Net Change in Loans                                     |                                      | 1,849  
|Proceeds from the Sale of Other Real Estate Owned       |                                      | 67     
|Purchase of Premises and Equipment                      |                                      | (73    
|                                                       
|NET CASH PROVIDED                                       |                                     
|BY INVESTING ACTIVITIES                                 |                                      | 2,092  
|FINANCING ACTIVITIES                                    |                                     
|Net Change in Deposits                                  |                                      | 9,122  
|Net Change in Other Borrowings                          |                                      | (4,000 
|Trust Preferred Securities, net of costs                |                                      | --     
|Proceeds from Supplemental Stock Offering, net of costs |                                      | --     
|Proceeds from Exercise of Warrants                      |                                      | --     
|Redemption of Stock                                     |                                      | --     
|Dividends                                               |                                      | (54    
|                                                       
|NET CASH PROVIDED                                       |                                     
|BY FINANCING ACTIVITIES                                 |                                      | 5,068  
|                                                       
|INCREASE IN CASH                                        |                                     
|AND CASH EQUIVALENTS                                    |                                      | 6,480  
|Cash and Cash Equivalents at Beginning of Period        |                                      | 7,194  
|                                                       
|CASH AND CASH EQUIVALENTS                               |                                     
|AT END OF PERIOD                                        |                                      | $13,674
|                                                       

|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, 2000 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, 2000 and 1999, 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. The financial statements include the operations of AIB from
the date of the acquisition. Goodwill arising from the transaction totaled
approximately $4.0 million and is being amortized over fifteen years on a
straight-line basis.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Note 2  Acquisition of American Independent
Bank, N.A.  Continued


The following table sets forth selected pro forma unaudited
combined financial results of the Company and AIB. The pro forma operating data
reflects the effect of the acquisition of AIB as if it was consummated at the
beginning of each period presented. The pro forma results are not indicative of
the results that would have occurred had the acquisition been in effect for the
full periods presented, nor are they indicative of the results of future
operations.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                       | Three Months EndedMarch 31,
|-------------------------------------- | ---------------------------
|
|Interest and Noninterest Income:       |                            
|The Company                            |                            
|AIB - Pre-Merger                       |                            
|                                      
|Total                                  |                            
|                                      
|Net Income:                            |                            
|The Company                            |                            
|AIB - Pre-Merger                       |                            
|Interest Costs - Pro Forma, net of Tax |                            
|Goodwill Amortization- Pro Forma       |                            
|                                      
|Total                                  |                            
|                                      
|Per Share Data:                        |                            
|Basic                                  |                            
|Diluted                                |                            

|These pro forma disclosures include adjustment to interest
expense from the funds borrowed to fund a portion of the purchase as well as
adjustments to per share data to reflect the issuance of common stock to fund
the balance of the purchase. No adjustments have been reflected in these amounts
for the anticipated cost savings to be derived from this merger.


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.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations



Income Summary


For the three months ended March 31, 2000, the Company reported a net loss of
$49,000, or $0.08 basic loss per share compared to a net loss $93,000, or $.26
basic loss per share for the same three month period in 1999. The annualized
return on average assets was (0.15)% for 2000 compared to (0.42)% for 1999.
Annualized return on average shareholders equity for 2000 and 1999 was
(3.02)% and (5.17)%, 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
$1,285,000 for the quarter ended March 31, 2000, compared to $897,000 for the
quarter ended March 31, 1999.


The total amount of net interest income increased for the
quarter ended March 31, 2000 compared to the same period in 1999 due to the
significant increase in interest-earning assets. This increase was primarily due
to the acquisition of American Independent Bank.


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

|                       | Three Months EndedMarch 31, |         
|---------------------- | --------------------------- | --------
|
|Interest Income        |                             | $2,469  
|Interest Expense       |                             | 1,184   
|                      
|Net Interest Income    |                             | $1,285  
|                      
|Average Earning Assets |                             | $117,068
|Net Interest Margin    |                             | 4.39    

|The net interest margin decreased in the first quarter of 2000
compared to the same quarter in 1999. Contributing to the decrease in net
interest margin was the interest expense relating to the recently issued $6.6
million in preferred securities. Interest expense incurred on these securities,
net of tax effect, was $116,000 in the first quarter of 2000. Had the
distribution not been charged to earnings, the Company would have recognized net
income of $67,000 in the first quarter of 2000.


The prime rate was 7.75% for the first six months of 1999 and
then experienced 25 basis point increases in June, August and November to end
the year at 8.50%. During the first quarter of 2000 prime was increased 25 basis
points in February and March. As of March 31, 2000 prime was 9.00%.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Provision for Loan Losses


The Company contributed $45,000 to the allowance for loan losses
in the first quarter of 2000. The Company made no contribution to the allowance
for loan losses in the first quarter of 1999. Management believes that the
allowance, which stands at 1.4% of total loans at March 31, 2000, is adequate to
cover future losses.


Changes in the allowance for loan losses for the quarter ended
March 31, 2000 and 1999 are as follows (dollar amounts in thousands):
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                | Quarter EndedMarch 31,
|------------------------------- | ----------------------
|
|Allowance, Beginning of Quarter |                       
|Provision for Loan Losses       |                       
|Recoveries on Loans Charged Off |                       
|Allowance from AIB Acquisition  |                       
|                               
|                                |                       
|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, 2000 totaled $255,000 compared to $140,000 for the same period
ended 1999. This represents an increase of $115,000. The increase is primarily
the result of an additional $75,000 in service charges and fee income related to
operations of the AIB branches after the acquisition on March 8, 1999 and the
recovery of previous $33,000 of operational losses.


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, 2000 totaled $1,508,000 compared to $1,157,000 for the same period during
1999. This increase was primarily the result of increased operating costs
related with the branches acquired in the AIB acquisition.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Income Taxes


The Companys income tax provision for the first quarter of
2000 was $36,000, resulting in an effective rate of 41.0% on loss before taxes
and goodwill amortization. The tax benefit for the first quarter of 1999 was
$27,000, resulting in an effective rate of 41.0% on income before taxes and
goodwill amortization.


Balance Sheet Analysis


Total assets at March 31, 2000 were $133.7 million, up 2.6% from
the $130.3 million reported at December 31, 1999. This increase was centered in
short-term investments, which were funded by short-term borrowings as well as
overall growth in deposits that have increased  10.2% since December
31, 1999.


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                                |           | $378        
|Loans 90 day past due and still accruing          |           | 61          
|Loans on nonaccrual                               |           | 636         
|                                                 
|Nonperforming Loans                               |           | 1,075       
|Other real estate owned                           |           | --          
|                                                 
|Nonperforming Assets                              |           | $1,075      
|                                                 
|                                                  |           |             
|Nonperforming loans as a percent of total loans   |           | 1.50        
|Allowance for loan losses as a percent            |          
|of nonperforming loans                            |           | 92.47       
|Nonperforming assets as a percent of total assets |           | 0.80        

|The primary ratios of loan quality have not changed
significantly in the first quarter of 2000. Nonperforming loans as a percent of
total loans increased to 1.50% at March 31, 2000, compared to 1.31% at December
31, 1999. The allowance for loan losses as a percent of nonperforming loans
increased to 92.47% at March 31, 2000, up from 90.63% at December 31, 1999. A
portion of this increase is due to the $45,000 provision made to the Allowance
for Loan Loss and net loan recoveries of $78,000.


Other Borrowings


Other borrowings at March 31, 2000 consist of $21.0 million in
short-term borrowings from the Federal Home Loan Bank and $935,000 in long-term
borrowings from a correspondent bank. The Company uses these sources to fund
asset growth and offset fluctuations in demand deposits.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|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, 2000 totaled $6.3
million, compared to $6.6 millionat December 31, 1999. This decrease was
attributable to the increase in net unrealized loss on available-for-sale
investments of $96,000, dividends of preferred stock of $54,000 and the net loss
of $49,000.


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

|                                         |  | March 31, | December 31,
|---------------------------------------- |  | --------- | ------------
|
|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, 2000 were 3.35% for Tier
1 capital to average assets, 5.04% for Tier 1 capital to risk-weighted assets
and 12.13% 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.


Year 2000 Compliance


During the periods leading up to January 1, 2000, the Company addressed
the potential problems associated with the possibility that the computers that
control or operate the Companys information technology system and
infrastructure may not have been programmed to read four-digit date codes and
upon the arrival of the year 2000, may have recognized the two-digit code
00 as the year 1900, causing systems to fail to function or generate
erroneous data.


The Company expended approximately $123,000 through the periods
ended December 31, 1999 in connection with its Year 2000 compliance program. The
Company experienced no significant problems related to its information
technology systems upon arrival of the Year 2000, nor was there any interruption
in service to its customers.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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

| | Exhibit 27
- Financial Data Schedule (for SEC use only)
| | -------------------------------------------------------

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

| | None
| | ----

|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 12, 2000 |  | /s/ Don M. GriffithDon M. GriffithChief Executive Officer,Chairman and Director
|------------------ |  | -------------------------------------------------------------------------------

|Date: May 12, 2000 |  | /s/ Deborah A. Marsten
Deborah A. MarstenChief Financial Officer,Vice Chairman and Secretary
|------------------ |  | --------------------------------------------------------------------------------------------