# UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

# Washington, D.C. 20549

# FORM 10-QSB

|[X] | QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- | ---------------------------------------------------------------------------------
|    | For the quarterly report ended March 31, 2005                                    

|[   ] | TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
|----- | ----------------------------------------------------------------------------------
|      | For the transition period from ___________ to _____________                       

Commission file number
000-30297

First Capital Bank Holding Corporation(Exact name of registrant as specified in its charter)

|Florida                  |  | 59-3532208                          
|------------------------ |  | ------------------------------------
|(State of Incorporation) |  | (I.R.S. Employer Identification No.)

1891 South 14th StreetFernandina Beach, Florida  32034
(Address of principal executive offices)   (Zip Code)

904-321-0400(Telephone Number)

Not Applicable(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act
during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X   No

State the number of shares outstanding  of each of the  issuer's  classes of common  equity,  as of the latest
practicable  date:  1,182,700 shares of common stock, $.01 par value per share, issued and outstanding as of
May 7, 2005.

Transitional Small Business Disclosure
Format (check one):   Yes    NoX

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# FIRST CAPITAL BANK
HOLDING CORPORATION PART I.  FINANCIAL INFORMATION

Item
1.      Financial Statements

| | The financial statements of First Capital Bank Holding Corporation (the Company)
are set forth in the following pages.
| | ------------------------------------------------------------------------------------------------------------------------

2

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# FIRST CAPITAL BANK
HOLDING CORPORATION

# Consolidated Balance Sheets

|                                                                | March 31, 2005 | December 31, 2004
|--------------------------------------------------------------- | -------------- | -----------------
|
|Assets                                                          |                |                  
|Cash and due from banks, including cash reserve requirements of |                |                  
|$395,000 and $427,000 respectively                              |                |                  
|Federal funds sold                                              |                |                  
|Interest bearing deposits in other banks                        |                |                  
|                                                                |                |                  
|Cash and cash equivalents                                       |                |                  
|Certificate of deposit                                          |                |                  
|Investment securities available-for-sale                        |                |                  
|Investment securities held to maturity, estimated fair value of |                |                  
|$13,475,796 and $14,350,154, respectively                       |                |                  
|Other investments                                               |                |                  
|Loans available-for-sale                                        |                |                  
|Loans, net of allowance of $1,174,403 and $1,103,403            |                |                  
|Premises and equipment, net                                     |                |                  
|Accrued interest receivable and other assets                    |                |                  
|                                                                |                |                  
|                                                                |                |                  
|                                                                |                |                  
|Liabilities and Shareholders' Equity                            |                |                  
|Deposits:                                                       |                |                  
|Noninterest bearing demand                                      |                |                  
|Interest bearing demand                                         |                |                  
|Savings                                                         |                |                  
|Time                                                            |                |                  
|Time over $100,000                                              |                |                  
|                                                                |                |                  
|Total deposits                                                  |                |                  
|Federal funds purchased and securities sold                     |                |                  
|under agreements to repurchase                                  |                |                  
|Federal Home Loan Bank advances                                 |                |                  
|Accrued interest payable and other liabilities                  |                |                  
|                                                                |                |                  
|Total liabilities                                               |                |                  
|                                                                |                |                  
|Commitments                                                     |                |                  
|Shareholders' equity:                                           |                |                  
|Preferred stock, par value $.01, 10,000,000 shares              |                |                  
|authorized, no shares issued and outstanding                    |                |                  
|Common stock, par value $.01; 10,000,000 shares authorized;     |                |                  
|1,182,700 and 1,008,000 issued and outstanding in 2005 and      |                |                  
|2004, respectively                                              |                |                  
|Additional paid-in capital                                      |                |                  
|Retained earnings                                               |                |                  
|Accumulated other comprehensive (loss) /  income                |                |                  
|                                                                |                |                  
|Total shareholders' equity                                      |                |                  
|                                                                |                |                  
|                                                                |                |                  
|                                                                |                |                  

See
accompanying notes to financial statements.

3

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# FIRST CAPITAL BANK
HOLDING CORPORATION Statements of EarningsFor the Three Months Ended
March 31, 2005 and 2004 (Unaudited)

|                                                             | Three Months Ended | 
|------------------------------------------------------------ | ------------------ | 
|
|
|Interest income:                                             |                    | 
|Interest and fees on loans                                   |                    | 
|Interest on investment securities - taxable                  |                    | 
|Interest on investment securities - tax-exempt               |                    | 
|Interest on federal funds sold and interest-bearing deposits |                    | 
|                                                             |                    | 
|Total interest income                                        |                    | 
|                                                             |                    | 
|Interest expense:                                            |                    | 
|Interest bearing deposits                                    |                    | 
|Interest on FHLB borrowings                                  |                    | 
|Interest on other borrowings                                 |                    | 
|                                                             |                    | 
|Total interest expense                                       |                    | 
|Net interest income                                          |                    | 
|Provision for loan losses                                    |                    | 
|                                                             |                    | 
|Net interest income after provision for loan losses          |                    | 
|                                                             |                    | 
|Noninterest income:                                          |                    | 
|Service charges on deposit accounts                          |                    | 
|Mortgage and SBA related fees and income                     |                    | 
|Gain on sales of loans                                       |                    | 
|Gain on sales of securities                                  |                    | 
|Other                                                        |                    | 
|                                                             |                    | 
|Total noninterest income                                     |                    | 
|                                                             |                    | 
|Noninterest expense:                                         |                    | 
|Salaries and employee benefits                               |                    | 
|Occupancy                                                    |                    | 
|Other                                                        |                    | 
|                                                             |                    | 
|Total noninterest expense                                    |                    | 
|                                                             |                    | 
|Net earnings before provision for income taxes               |                    | 
|                                                             |                    | 
|Provision for income taxes:                                  |                    | 
|                                                             |                    | 
|Net income:                                                  |                    | 
|                                                             |                    | 
|Earnings Per Share:                                          |                    | 
|Basic                                                        |                    | 
|                                                             |                    | 
|Diluted                                                      |                    | 
|                                                             |                    | 

See accompanying notes to financial statements.

4

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# FIRST CAPITAL BANK
HOLDING CORPORATION Statements of Operations and Comprehensive Income (Loss)For the Three Months
Ended March 31, 2005 and 2004 (Unaudited)

|                                                    | Three Months | 
|--------------------------------------------------- | ------------ | 
|
|
|Net earnings                                        |              | 
|Other comprehensive income, net of tax:             |              | 
|Unrealized (losses) gains on investment             |              | 
|Securities available for sale:                      |              | 
|Unrealized (losses) gains arising during the period |              | 
|Associated  (taxes) benefit                         |              | 
|Reclassification adjustment for gains               |              | 
|Associated taxes                                    |              | 
|                                                    |              | 
|Other comprehensive (loss) income                   |              | 
|                                                    |              | 
|Comprehensive income                                |              | 
|                                                    |              | 

See
accompanying notes to financial statements.

5

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# FIRST CAPITAL BANK
HOLDING CORPORATION Statements of Cash
Flows For the Three Months
Ended March 31, 2005 and 2004 (Unaudited)

|                                                                               | 2005 | 2004
|------------------------------------------------------------------------------ | ---- | ----
|Cash flows from operating activities:                                          |      |     
|Net income                                                                     |      |     
|Adjustments to reconcile net income to net cash:                               |      |     
|Operating activities:                                                          |      |     
|Depreciation, amortization and accretion                                       |      |     
|Provision for loan losses                                                      |      |     
|Gain on sale of securities                                                     |      |     
|Net change in loans available for sale                                         |      |     
|Change in cash surrender value of bank owned life insurance                    |      |     
|Change in other assets                                                         |      |     
|Change in other liabilities                                                    |      |     
|                                                                               |      |     
|Net cash (used) provided by in operating activities                            |      |     
|                                                                               |      |     
|Cash flows from investing activities:                                          |      |     
|Proceeds from sale of investment securities available-for-sale                 |      |     
|Proceeds from maturities, calls, and paydowns of securities available for sale |      |     
|Proceeds from maturities, calls, and paydowns of securities held to maturity   |      |     
|Redemption (purchase) of other investments                                     |      |     
|Net change in portfolio loans                                                  |      |     
|Purchase of premises and equipment                                             |      |     
|                                                                               |      |     
|Net cash (used) in investing activities                                        |      |     
|                                                                               |      |     
|Cash flows provided by financing activities                                    |      |     
|Net change in deposits                                                         |      |     
|Net change in repurchase agreements                                            |      |     
|Net change in warehouse line of credit                                         |      |     
|Proceeds from stock options exercised                                          |      |     
|                                                                               |      |     
|Net cash provided by financing activities                                      |      |     
|                                                                               |      |     
|Net increase (decrease) in cash                                                |      |     
|Cash and cash equivalents at the beginning of the period                       |      |     
|                                                                               |      |     
|Cash and cash equivalents at the end of the period                             |      |     
|                                                                               |      |     
|Supplemental cash flow information:                                            |      |     
|Interest paid                                                                  |      |     
|                                                                               |      |     
|Taxes paid                                                                     |      |     
|                                                                               |      |     

See
accompanying notes to financial statements.

6

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# FIRST CAPITAL BANK
HOLDING CORPORATION Notes to Financial
Statements (Unaudited)

# Note 1  Critical
Accounting Policies

We
have adopted various accounting policies, which govern the application of accounting
principles generally accepted in the United States in the preparation of our financial
statements. Our significant accounting policies are described in the footnotes to the
consolidated financial statements at December 31, 2004 as filed on our annual report on
Form 10-KSB.

Certain
accounting policies involve significant judgments and assumptions by us, which have a
material impact on the carrying value of certain assets and liabilities. We consider these
accounting policies to be critical accounting policies. The judgments and assumptions we
use are based on historical experience and other factors, which we believe to be
reasonable under the circumstances. Because of the nature of the judgments and assumptions
we make, actual results could differ from these judgments and estimates which could have a
material impact on our carrying values of assets and liabilities and our results of
operations.

Many
of our assets and liabilities are recorded using various valuation techniques that require
significant judgment as to recoverability. We believe the allowance for loan losses is a
critical accounting policy that requires the most significant judgments and estimates used
in preparation of our consolidated financial statements. Refer to the portion of this
discussion that addresses our allowance for loan losses for a description of our processes
and methodology for determining our allowance for loan losses. In addition, investment
securities and mortgage loans held for sale are reflected at their estimated fair value in
the consolidated financial statements. Such amounts are based on either quoted market
prices or estimated values derived by our using dealer quotes or market comparisons.

In
our opinion, all accounting adjustments necessary to accurately reflect the financial
position and results of operations on the accompanying financial statements have been
made. These adjustments are considered normal and recurring accruals are considered
necessary for a fair and accurate presentation. The results for interim periods are not
necessarily indicative of results for the full year or any other interim periods.

# Stock Compensation Plans

We
have elected not to expense stock options and, as such, have provided proforma disclosures
of net earnings and earnings per share, as if the fair value method of accounting had been
applied. Had compensation cost for the plan been determined based upon the fair value of
the options at the grant dates, our net earnings and net earnings per share for the
quarters ended March 31, 2005 and 2004, would have been reduced to the proforma amounts
indicated below:

|                           |  | Three Months Ended
|-------------------------- |  | ------------------
|
|
|Net earnings               |  |                   
|                           |  |                   
|Basic earnings per share   |  |                   
|                           |  |                   
|Diluted earnings per share |  |                   
|                           |  |                   

The
fair value of each option is estimated on the date of grant using the Minimum Value
pricing model with the following assumptions used for grants issued in 2003 : no dividend
yield, a risk free interest rate of 4.35% and an expected life of 10 years. The difference
between the net earnings as reported and proforma is the expense associated with the
grants, which would have been earned in the period. No options were granted during the
first quarter of 2005. This expense was calculated based on the number of options vested
during the period multiplied by the fair value at the time of grant net of the related tax
effect.

7

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# FIRST CAPITAL BANK
HOLDING CORPORATION Notes to Financial
Statements (Unaudited)

# Significant accounting
policies continued

# Employee Benefits

In 2004, the Company commenced a
Phantom Stock Appreciation Rights (PSAR) plan for the benefit of certain
employees designated by the Board of Directors. Under the plan, participants will be due
an amount representing the incremental value of the underlying stock as compared to the
strike price of the PSAR at the time of grant. The vesting of the option is determined at
the time of the grant and is at the discretion of the Company. During 2004, the Company
issued 21,500 PSARs with a strike price of $17.35, which approximated the fair value of
underlying stock at the time of grant. During 2005, the Company granted an additional
14,000 PSARs at a strike price of $18.37. There were 6,000 PSARs forfeited in the first
quarter of 2005. There were 29,500 PSARs outstanding as of March 31, 2005.

# Note 2  Earnings
per share

Basic
earnings per share is based on the weighted average number of common shares outstanding
during the period while the effects of potential common shares outstanding during the
period are included in diluted earnings per share. The average market price during the
year is used to compute equivalent shares. Reconciliation of the amounts used in the
computation of both basic earnings per share and diluted earnings per
share for the three month periods ended March 31, 2005 and 2004 are as follows:

|                                              | For the three months ended March 31, 2005
|--------------------------------------------- | -----------------------------------------
|
|
|Basic earnings per share                      |                                          
|Effect of dilutive securities - Stock Options |                                          
|                                              |                                          
|Diluted earnings per share                    |                                          
|                                              |                                          

|                                              | For the three months ended March 31, 2005
|--------------------------------------------- | -----------------------------------------
|
|
|Basic earnings per share                      |                                          
|Effect of dilutive securities - Stock Options |                                          
|                                              |                                          
|Diluted earnings per share                    |                                          
|                                              |                                          

# Note 3  Subsequent
Events

On April 6, 2005, management signed a
definitive merger agreement with Coastal Banking Company, Inc., with assets of $146
million, headquartered in Beaufort, SC. The merger is pending approval by the respective
shareholders of the wo companies and regulators. The two banks will continue to operate
under their well-established brands and will be wholly owned subsidiaries of Coastal
Banking Company, Inc., (OTC BB: CBCO.OB). Terms of the merger call for each common share
of First Capital Bank Holding Corporation to be exchanged for 1.054 common shares of
Coastal Banking Company, Inc. The merger is expected to close during the fourth quarter of
2005.

8

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# Item 2.    
Managements Discussion and Analysis of Financial Condition and Results of Operations                           For the Three Months
Ended March 31, 2005 and 2004

# FORWARD-LOOKING
STATEMENTS

The
following is our discussion and analysis of certain significant factors that have affected
our financial position and operating results and those of our subsidiary, First National
Bank of Nassau County, during the periods included in the accompanying financial
statements. This commentary should be read in conjunction with the financial statements
and the related notes and the other statistical information included in this report.

This
report contains forward-looking statements relating to, without limitation,
future economic performance, plans and objectives of management for future operations, and
projections of revenues and other financial items that are based on the beliefs of
management, as well as assumptions made by and information currently available to
management. The words may, will, anticipate,
should, would, believe, contemplate,
expect, estimate, continue, may, and
intend, as well as other similar words and expressions of the future, are
intended to identify forward-looking statements. Our actual results may differ materially
from the results discussed in the forward-looking statements, and our operating
performance each quarter is subject to various risks and uncertainties that are discussed
in detail in our filings with the Securities and Exchange Commission, including, without
limitation:

| | o | the businesses of Coastal and First Capital may not be integrated successfully or such
integration may take longer to accomplish than expected;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------

| | o | the  expected  cost  savings  and any  revenue  synergies  from the  merger  may not be fully  realized  within  the  expected
                 timeframes;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------

| | o | disruption from the merger may make it more difficult to maintain relationships with clients, associates, or suppliers;
| | - | -----------------------------------------------------------------------------------------------------------------------

| | o | the required governmental approvals of the merger may not be obtained on the proposed terms and schedule;
| | - | ---------------------------------------------------------------------------------------------------------

| | o | shareholders may not approve the merger;
| | - | ----------------------------------------

| | o | changes in economic conditions;
| | - | -------------------------------

| | o | movements in interest rates;
| | - | ----------------------------

| | o | competitive pressures on product pricing and services;
| | - | ------------------------------------------------------

| | o | success and timing of other business strategies;
| | - | ------------------------------------------------

| | o | the nature, extent, and timing of governmental actions and reforms; and extended disruption of vital infrastructure;
| | - | --------------------------------------------------------------------------------------------------------------------

| | o | and other factors described in our 2005 Annual Report on Form 10-KSB, and documents
subsequently filed by us with the Securities and Exchange Commission.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------

9

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# Item 2.    
Managements Discussion and Analysis of Financial Condition and Results of Operations, continued

# Overview

The
following discussion describes our results of operations for the quarter ended March 31,
2005 as compared to the quarter ended March 31, 2004 and also analyzes our financial
condition as of March 31, 2005 as compared to December 31, 2004. Like most community
banks, we derive most of our income from interest we receive on our loans and investments.
Our primary source of funds for making these loans and investments is our deposits, on
which we pay interest. Consequently, one of the key measures of our success is our amount
of net interest income, or the difference between the income on our interest-earning
assets, such as loans and investments, and the expense on our interest-bearing
liabilities, such as deposits. Another key measure is the spread between the yield we earn
on these interest-earning assets and the rate we pay on our interest-bearing liabilities.

Of
course, there are risks inherent in all loans, so we maintain an allowance for loan losses
to absorb probable losses on existing loans that may become uncollectible. We establish
and maintain this allowance by charging a provision for loan losses against our operating
earnings. In the following section we have included a detailed discussion of this process.

In
addition to earning interest on our loans and investments, we earn income through fees and
other expenses we charge to our customers. We describe the various components of this
noninterest income, as well as our noninterest expense, in the following discussion.

The
following discussion and analysis also identifies significant factors that have affected
our financial position and operating results during the periods included in the
accompanying financial statements. We encourage you to read this discussion and analysis
in conjunction with the financial statements and the related notes and the other
statistical information also included in this report.

# Financial Condition

As
of March 31, 2005, we had total assets of $158.9 million, an increase of 12% when compared
to December 31, 2004. The primary factor was the increase in federal funds sold of $11.3
million. The increase in federal funds sold is a result of our deposit growth described
below, as we have invested the funds we received from these deposits in federal funds on a
temporary basis until we use these funds to support future loan growth. Our gross loan
portfolio increased by $4.6 million to $96.0 million at March 31, 2005 as new loan
production remained strong. Our total loan to deposit ratios were 78% and 92% as of March
31, 2005. We are making a concerted effort to develop a quality portfolio loan business in
the local market and to manage the deposit growth consistent with expected loan demand.

Our
deposit growth remained strong in the first quarter of 2005 as a result of increased
marketing efforts within our community. When compared to December 31, 2004, deposits for
the three months ended March 31, 2005 increased $24.0 million, or 24%. Funds from the
deposit growth were used to pay off repurchase agreements and federal funds purchased of
$7.3 million as of December 31, 2004, and to fund new loan growth. We anticipate using the
excess federal funds to fund future loan growth and pay down maturing borrowed fund
advances in the second quarter. Repurchase agreements and warehouse line advances are
short-term borrowings and fluctuate according to loan demand.

The
deposit mix at March 31, 2005 was as follows: $13.3 million (11% of total deposits) in
noninterest bearing demand deposits; $14.3 million (12% of total deposits) in interest
checking accounts; $35.3 million (29% of total deposits) in savings accounts; and $60.7
milllion (49% of total deposits) in time deposits. The deposit mix remains weighted
towards higher costing time deposits. We expect this trend to continue with an emphasis on
time deposits, thus increasing the average cost of funds and potentially reducing the
banks net interest margin.

At
March 31, 2005, total investment securities were $34.5 million, $20.9 million in
securities classified as available for sale and $13.6 million in securities classified as
held to maturity. Liquidity remains sufficient to support the current operating needs and
growth opportunities of the bank. The current investment portfolio strategy is primarily
to provide liquidity for funding loans and earnings enhancement. Accordingly, all
investment securities available for sale are pledgeable to raise funding through public
deposits, secured borrowing, or repurchase agreements. Investment securities classified as
held to maturity are pledged to the FHLB.

At
March 31, 2005, retained earnings totaled $5.3 million, including net income of $307,576
for the three months ended March 31, 2005.

10

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# Item 2.    
Managements Discussion and Analysis of Financial Condition and Results of Operations, continued

# Results of Operations

Net
income for the three months ended March 31, 2005 was $307,576, as compared to $213,738 for
the same period in 2004. The increase in our results was due to growth in net interest
income generated from the growth in loans and investments.

# Net interest Income

Net
interest income for the three months ended March 31, 2005 was $1.3 million, compared to
$1.0 million for the three months ended March 31, 2004. Total interest income for the
first three months of 2005 was $2.0 million, compared to $1.4 million for the same period
in 2004. Included in interest income is interest and fees on loans totaling $1.6 million
for the three months ended March 31, 2005 and $1.1 million for the same period in 2004.
Interest income also includes interest income on investments of $382,814 and $243,718 for
the three months ended March 31, 2005 and 2004, respectively. The growth in interest
income reflects the growth in our core interest earning assets. Interest income on loans
as a percentage of total interest income decreased to 80% at March 31, 2005, as compared
to 82% for the same period last year. The decrease is due to the increase in average
investment securities and lower yields in the loan portfolio. We incurred interest expense
on interest bearing deposits of $568,945 for the three months ended March 31, 2005, as
compared to $291,993 for the same period in 2004. These numbers reflect the effect of the
increase in the cost of deposits for the year due to the increase in rates offered on
these products. Additionally, we recognized $165,127 and $42,410 of interest expense from
FHLB advances for the three months ended March 31, 2005 and 2004, respectively.

Our
earning assets are principally floating rate while the funding sources are primarily money
market and short-term time deposits. The net interest margins as of March 31, 2005 and
2004 were 3.75% and 4.20%, respectively. Our margins have decreased due to the increased
investments and federal funds sold as a percentage of earning assets, repricing of
short-term certificates of deposit and money markets, and increased usage of FHLB term
advances. We expect interest margins to increase as we continue to grow our loan portfolio
as a percentage of average assets.

The
following table details the relationship between interest income and expense and the
average balances of interest earning assets and interest bearing liabilities for the three
months ended March 31, 2005 and 2004.

|                             |  | 2005 |   |             | 2004 | 
|---------------------------- |  | ---- | - | ----------- | ---- | 
|
|
|
|Loans                        |  |      | $ | 95,000,561  |      | 
|Federal funds sold and       |  |     
|deposits with banks          |  |      |   | 3,293,531   |      | 
|Investments                  |  |      |   | 37,326,615  |      | 
|CD's at other banks          |  |      |   | 500,000     |      | 
|                             |  |      |   |             |      | 
|Interest earning assets      |  |      |   | 136,120,707 |      | 
|                             |  |      |   |             |      | 
|Interest bearing deposits    |  |      |   | 97,014,780  |      | 
|FHLB borrowings              |  |      |   | 18,000,000  |      | 
|Other borrowings             |  |      |   | 1,423,711   |      | 
|                             |  |      |   |             |      | 
|Interest bearing liabilities |  |      | $ | 116,438,491 |      | 
|                             |  |      |   |             |      | 
|Net interest income          |  |      |   |             |      | 
|                             |  |      |   |             |      | 
|Net interest spread          |  |      |   |             |      | 
|                             |  |      |   |             |      | 
|Net interest margin          |  |      |   |             |      | 
|                             |  |      |   |             |      | 

11

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# Item 2.    
Managements Discussion and Analysis of Financial Condition and Results of Operations, continued

# Allowance and Provision
for Loan Losses

There
are risks inherent in making all loans, including risks with respect to the period of time
over which loans may be repaid, risks resulting from changes in economic and industry
conditions, risks inherent in dealing with individual borrowers, and, in the case of a
collateralized loan, risks resulting from uncertainties about the future value of the
collateral. To address these risks, we have developed policies and procedures to evaluate
the overall quality of our credit portfolio and the timely identification of potential
problem loans. We maintain an allowance for possible loan losses which we establish
through charges in the form of a provision for loan losses. We charge loan losses and
credit recoveries directly to this allowance.

We
attempt to maintain the allowance at a level that will be adequate to provide for
potential losses in our loan portfolio. To maintain the allowance at an adequate level, we
periodically make additions to the allowance by charging an expense to the provision for
loan losses on our statement of income.

The
provision for loan losses was $71,000 and $56,000 for the three months ended March 31,
2005 and 2004, respectively. Our judgment in determining the adequacy of the allowance is
based on evaluations of the collectibility of loans. These evaluations take into
consideration such factors as changes in the nature and volume of the loan portfolio,
current economic conditions that may affect the borrowers ability to pay, overall
portfolio quality, and review of specific problem loans. In determining the adequacy of
the allowance for loan losses, we use a loan grading system that rates loans in different
categories. Certain grades representing criticized or classified loans are assigned
allocations of loss based on our estimate of potential loss that is generally based on
historical losses and/or collateral deficiencies. Other loans are graded by type and
allocated loss ranges based on our perceived inherent loss for the loan type. The
combination of these results are compared monthly to the recorded allowance for loan
losses and material differences are adjusted by increasing or decreasing the provision for
loan losses. We use an independent third party loan reviewer to challenge and corroborate
the loan grading system and provide additional analysis in determining the adequacy of the
allowance for loan losses and the future provisions for estimated loans.

At
March 31, 2005, the allowance for loan losses was $1,174,403 compared to $1,103,403 at
December 31, 2004, which represented 1.22% and 1.21% of outstanding portfolio loans,
respectively. We believe that the allowance for loan losses is adequate, based on internal
reviews and external reviews of the quality of the loan portfolio and bank peer group
data. Our evaluation is inherently subjective as it requires estimates that are
susceptible to significant change. Our losses will undoubtedly vary from our estimates,
and there is a possibility that charge-offs in future periods will exceed the allowance
for loan losses as estimated at any point in time. Due to the rapid growth of our bank
over the past several years and our short operating history, a large portion of the loans
in our loan portfolio and of our lending relationships are of relatively recent origin. In
general, loans do not begin to show signs of credit deterioration or default until they
have been outstanding for some period of time, a process we refer to as
seasoning. As a result, a portfolio of older loans will usually behave more
predictably than a newer portfolio. Because our loan portfolio is relatively new, the
current level of delinquencies and defaults may not be representative of the level that
will prevail when the portfolio becomes more seasoned, which may be higher than current
levels. If delinquencies and defaults increase, we may be required to increase our
provision for loan losses, which would adversely affect our results of operations and
financial condition. While we do use available information to recognize losses on loans,
future additions to the allowance may be necessary based on changes in economic
conditions. In addition, various regulatory agencies, as an integral part of their
examination process, periodically review the banks allowance for loan losses. These
agencies may require the bank to recognize additions to the allowance based on judgments
different than those of management.

12

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# Item 2.    
Managements Discussion and Analysis of Financial Condition and Results of Operations, continued

The following is a summary of our
loan loss history:

|                                       | March 31, 2005 | March 31, 2004
|-------------------------------------- | -------------- | --------------
|Balance January 1,                     |                |               
|Year to date provision for loan losses |                |               
|Charged off loans                      |                |               
|                                       |                |               
|Balance, end of period                 |                |               
|                                       |                |               

As
of March 31, 2005, we had one non-accrual loan totaling $34,000, which is guaranteed by
the Small Business Administration. At December 31, 2004, we had one non-accrual loan
totaling $44,827, which was guaranteed by the Small Business Administration. We have no
loans past due 90 days or more accruing interest.

# Noninterest Income and
Expense

Noninterest
income was $306,554 and $736,945 for the three months ended March 31, 2005 and 2004,
respectively. This decrease consists primarily from decrease in mortgage income as a
result of the discontinuation of our wholesale residential mortgage operations in April
2004. Gains on the sale of loans decreased by approximately $311,000 and gains on sales of
securities decreased by approximately $100,000 from the same period in 2004.

Noninterest
expense was $1.0 million and $1.4 million for the three-month period ended March 31, 2005
and 2004, respectively. Salaries and benefits for the three months ended March 31, 2005
and 2004 totaled $615,193 and $852,550, respectively. The decrease is primarily due to
reduction in staff as a result of the sale of the assets of the wholesale mortgage
division on April 2004.

# Liquidity and Capital

Liquidity
represents the ability of a company to convert assets into cash or cash equivalents
without significant loss, and the ability to raise additional funds by increasing
liabilities. Liquidity management involves monitoring our sources and uses of funds in
order to meet our day-to-day cash flow requirements while maximizing profits. Liquidity
management is made more complicated because different balance sheet components are subject
to varying degrees of management control. For example, the timing of maturities of our
investment portfolio is fairly predictable and subject to a high degree of control at the
time investment decisions are made. However, net deposit inflows and outflows are far less
predictable and are not subject to the same degree of control.

The
bank has established short-term federal funds purchase lines of credit with its
correspondent banks, which total $7.2 million. These lines are unsecured and are designed
to provide the bank with short-term liquidity. These lines may be revoked at any time by
the correspondent banks and are available to the bank simply as an accommodation for
short-term (two weeks or less) liquidity needs. Additionally, the bank has cash and cash
equivalents of $19.7 million and investments available for sale of $20.9 million to fund
operations and loan growth.

Currently,
we limit investments to highly liquid overnight investments in correspondent banks and
bank-qualified securities. In May 2004, we purchased $15 million of securities classified
as held to maturity to employ capital, adding to the amount of our earning assets. The
purchase was funded by FHLB advances structured to compliment the current cash flows of
the investment portfolio. For the foreseeable future, we will consider our investment
portfolio primarily as a source for liquidity and a source for earnings.

Bank
holding companies and their banking subsidiaries are required by banking regulators to
meet certain minimum levels of capital adequacy, which are expressed in the form of
certain ratios. Capital is separated into Tier 1 capital (essentially common
shareholders equity less intangible assets) and Tier 2 capital (essentially the
allowance for loan losses limited to 1.25% of risk-weighted assets). The first two ratios,
which are based on the degree of credit risk in our assets, provide the weighting of
assets based on assigned risk factors and include off-balance sheet items such as loan
commitments and stand-by letters of credit. The ratio of Tier 1 capital to risk-weighted
assets must be at least 4.0% and the ratio of total capital (Tier 1 capital plus Tier 2
capital) to risk-weighted assets must be at least 8.0%. The capital leverage ratio
supplements the risk-based capital guidelines.

13

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# Item 2.    
Managements Discussion and Analysis of Financial Condition and Results of Operations, continued

A
bank is considered to be well capitalized if it has total risk-based capital
ratio of 10.0% or greater, a Tier I risk-based capital ratio of 6.0% or greater, and has a
leverage ration of 5.0% or greater. Based upon these guidelines, the bank is considered to
be well capitalized at March 31, 2005.

Banks
and bank holding companies are required to maintain a minimum ratio of Tier 1 capital to
adjusted quarterly average total assets of 3.0%. The following table sets forth the
holding companys and the banks various capital ratios at March 31, 2005. The
bank was considered well capitalized and the holding company met or exceeded
its applicable regulatory capital requirements.

|                                         | Amount | %
|---------------------------------------- | ------ | -
|Total capital (to risk weighted assets)  |        |  
|Bank                                     |        |  
|Holding company consolidated             |        |  
|Tier 1 capital (to risk weighted assets) |        |  
|Bank                                     |        |  
|Holding company consolidated             |        |  
|Tier 1 capital (to average assets)       |        |  
|Bank                                     |        |  
|Holding company consolidated             |        |  

# Off Balance Sheet Risk

Through
the operations of our bank, we have made contractual commitments to extend credit in the
ordinary course of our business activities. These commitments are legally binding
agreements to lend money to our customers at predetermined interest rates for a specified
period of time. At March 31, 2005, we had issued commitments to extend credit of $23.8
million through various types of commercial lending arrangements, of which $1.3 million
was at fixed rates and $22.5 million was at variable rates. We evaluate each
customers credit worthiness on a case-by-case basis. The amount of collateral
obtained, if deemed necessary by us upon extension of credit, is based on our credit
evaluation of the borrower. Collateral varies but may include accounts receivable,
inventory, property, plant and equipment, commercial and residential real estate.

# Item 3. Controls and
Procedures

As
of the end of the period covered by this report, we carried out an evaluation, under the
supervision and with the participation of our management, including our Chief Executive
Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and
procedures as defined in Exchange Act Rule 13a-15(e). Based upon that evaluation, our
Chief Executive Officer and Chief Financial Officer have concluded that our current
disclosure controls and procedures are effective as of March 31, 2005. There have been no
significant changes in our internal controls over financial reporting during the fiscal
quarter ended March 31, 2005 that have materially affected, or are reasonably likely to
materially affect, our internal controls over financial reporting.

The
design of any system of controls and procedures is based in part upon certain assumptions
about the likelihood of future events. There can be no assurance that any design will
succeed in achieving its stated goals under all potential future conditions, regardless of
how remote.

14

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# PART II. OTHER
INFORMATION

# Item 1.   Legal Proceedings

There
are no material pending legal proceedings to which we are a party or of which any of our
property is the subject.

# Item 2.   Unregistered
Sales of Equity Securities and Use of Proceeds

None

# Item 3.   Defaults Upon
Senior Securities

None

# Item 4.   Submission of Matters to a Vote of Security Holders

None

# Item 5.   Other Information

| | Due to the proposed merger with Coastal Banking Company, Inc., we intend to combine our annualmeeting
with a special meeting in which shareholders will vote on the election of directors and
the proposed merger. We currently anticipate holding the meeting in August 2005. If
shareholders wish a proposal to be included in the proxy statement and form of proxy
relating to such meeting, they must deliver a written copy of their proposal to the
companys principal executive offices no later than May 31, 2005. To ensure prompt
receipt by the company, the proposal should be sent certified mail, return receipt
requested. Proposals must comply with our bylaws relating to shareholder proposals in
order to be included in the proxy materials. A copy of the bylaws is available upon
written request.Our policy is that any shareholder proposal to be made at an annual meeting, but which is not
requested to be included in the proxy materials, must be delivered to the secretary of the
company between 30 and 60 days prior to the annual meeting; provided, however, that if
less than 31 days notice of the meeting is given to shareholders, the notice must be
delivered within 10 days following the day on which notice of the meeting was mailed to
shareholders.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Item 6.   Exhibits

Exhibit         Description

31.1        Rule 13a-14(a) Certification of the Principal Executive Officer.

31.2       Rule 13a-14(a) Certification of the Principal Financial Officer.

32          Section 1350
Certifications.

15

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SIGNATURES

In
accordance with the requirements of the Exchange Act, the registrant caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

| |  | FIRST CAPITAL BANK HOLDING CORPORATION
(Registrant)
| |  | ---------------------------------------------------

|Date:  May 13, 2005 |  | By:  /s/ Michael G. Sanchez
        Michael G. Sanchez 
      President and Chief Executive Officer
|------------------- |  | ---------------------------------------------------------------------------------------------------

|Date:  May 13, 2005 |  | By:  /s/ Timothy S. Ayers
       Timothy S. Ayers       Principal Accounting and Chief Financial Officer
|------------------- |  | --------------------------------------------------------------------------------------------------------

16

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INDEX TO EXHIBITS

ExhibitNumber          Description

31.1        Rule 13a-14(a) Certification of the Principal Executive Officer.

31.2       Rule 13a-14(a) Certification of the Principal Financial Officer.

32          Section 1350
Certifications.

17