**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**


**Form
      10-Q**








x
            QUARTERLY
                REPORT UNDER SECTION 13 AND 15(d) OF THE SECURITIES EXCHANGE ACT
                OF
                1934
              For
                  the quarterly period endedJune
                  30, 2007





o
            TRANSITION
                REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT 1934
              For
                  the transition period from _______ to
                  _______





Commission
      File Number: 000 -25345





**Community
      Capital Bancshares, Inc.**


(Exact
      name of registrant as specified in its charter)





Georgia
            58-2413468(State
                or other jurisdiction of
            (IRS
                EmployerIncorporation
                or organization)
            Identification
                No.)





P.O.
      Drawer 71269, Albany, Georgia 31708


(Address
      of principal executive offices)





(229)
      446-2265


(Registrant's
      telephone number, including area code)





Not
      Applicable


(Former
      name, former address and former fiscal year, if changed since last
      report)





Indicate
      by check mark whether the registrant (1) filed all reports required to be filed
      by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 Noo




Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer or a non-accelerated filer. See definition of “accelerated
      filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act (check
      one).





Large
      Accelerated Filer o Accelerated
      Filer oNon-Accelerated
      Filer x





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).




Yes o No
x




**APPLICABLE
      ONLY TO CORPORATE ISSUERS:**





Indicate
      the number of shares outstanding of each of the issuer's classes of common
      stock
      as of August 8, 2007: 3,057,279 shares
















**PART
                I - FINANCIAL INFORMATION**
            Page
                No.ITEM
                1.
            Financial
                StatementsConsolidated
                balance sheets as of December 31, 2006 and June 30, 2007
                (unaudited)
            3Consolidated
                statements of income (unaudited) for the three and six months ended
                June
                30, 2006 and 2007
            4Consolidated
                statements of comprehensive income (unaudited) for the three and
                six
                months ended June 30, 2006 and 2007
            5Consolidated
                statements of cash flows (unaudited) for the six months ended June
                30,
                2006 and 2007
            6Item
                2.
            Management’s
                Discussion and Analysis of Financial Condition and Results of
                Operations
            9Item
                3.
            Quantitative
                and Qualitative Disclosures about Market Risk
            13Item
                4.
            Controls
                and procedures
            14**PART
                II - OTHER INFORMATION**ITEM
                1.
            Legal
                Proceedings
            15ITEM
                1.A.
            Risk
                Factors
            15ITEM
                2.
            Unregistered
                Sales of Equity Securities and Use of Proceeds
            15ITEM
                3.
            Defaults
                upon Senior Securities
            15ITEM
                4.
            Submission
                of matters to a vote of Security Holders
            15ITEM
                5.
            Other
                Information
            15ITEM
                6.
            Exhibits
            15
















**Community
        Capital Bancshares, Inc.**
 **and
        Subsidiaries**
 **Consolidated
        Balance Sheets**
 (Dollars
        in thousands)




June
                30, 2007
              (unaudited)
            
            
            December
                31,
              2006**Assets**Cash
                and due from banks
            
            $
            5,202
            
            $
            7,408Federal
                funds sold
            
            
            25,507
            
            
            6,400Securities
                available for sale
            
            
            40,813
            
            
            36,524Restricted
                equity securities
            
            
            2,590
            
            
            2,434Loans
            
            
            176,392
            
            
            225,630Less
                allowance for loan losses
            
            
            5,821
            
            
            5,507Loans,
                net
            
            
            170,571
            
            
            220,123Premises
                and equipment
            
            
            6,673
            
            
            6,758Premises
                and equipment held for sale
            
            
            -
            
            
            3,022Goodwill
            
            
            2,334
            
            
            2,334Core
                deposit premium
            
            
            222
            
            
            240Other
                assets
            
            
            12,592
            
            
            11,693**Total
                Assets******
            
            $
            266,504
            
            $
            296,936**Liabilities
                and Shareholders' Equity**DepositsNon-interest
                bearing
            
            $
            19,055
            
            $
            19,480Interest
                bearing
            
            
            187,565
            
            
            218,073Total
                deposits
            
            
            206,620
            
            
            237,553Other
                borrowings
            
            
            27,000
            
            
            27,000Guaranteed
                preferred beneficial interests in junior subordinated
                debentures
            
            
            4,124
            
            
            4,124Other
                liabilities
            
            
            1,491
            
            
            1,467**Total
                Liabilities**
            
            
            239,235
            
            
            270,144Shareholders'
                equityPreferred
                stock, par value not stated; 2,000,000 shares authorized;no
                shares issued
            
            $
            -
            
            $
            -Common
                stock, $1.00 par value, 10,000,000 shares authorized;3,104,040
                and 3,074,210 shares issued
            
            
            3,104
            
            
            3,074Capital
                surplus
            
            
            23,311
            
            
            23,032Retained
                earnings
            
            
            2,013
            
            
            1,654Accumulated
                other comprehensive loss
            
            
            (790
            )
            
            (568
            )Less
                cost of treasury stock, 49,371 and 53,475 shares as of
              June
                30, 2007 and December 31, 2006 respectively
            
            
            (369
            )
            
            (400
            )**Total
                shareholders' equity**
            
            
            27,269
            
            
            26,792**Total
                Liabilities and Shareholders' Equity**
            
            $
            266,504
            
            $
            296,936






3




**Community
        Capital Bancshares, Inc.**
 **and
        Subsidiaries**
 **Consolidated
        Statements of Income (unaudited)**
 **For
        the three and six months ended June 30, 2007 and 2006**
 **(Dollars
        in thousands, except per share data)**




Three
                    months ended
                
                
                Six
                    months endedJune
                    30,
                  2007
                
                
                June
                    30,
                  2006
                
                
                June
                    30,
                  2007
                
                
                June
                    30,
                  2006**Interest
                  income**Loans
                
                
                4,163
                
                
                5,423
                
                
                8,900
                
                
                10,253Investment
                    securities
                
                
                449
                
                
                469
                
                
                884
                
                
                938Deposits
                    in banks
                
                
                3
                
                
                10
                
                
                4
                
                
                11Federal
                    funds sold
                
                
                110
                
                
                -
                
                
                183
                
                
                183**Total
                    interest income**
                
                
                4,725
                
                
                5,902
                
                
                9,971
                
                
                11,385**Interest
                  expense**Deposits
                
                
                2,126
                
                
                2,511
                
                
                4,471
                
                
                4,721Other
                    borrowed money
                
                
                385
                
                
                413
                
                
                761
                
                
                861**Total
                    interest expense**
                
                
                2,511
                
                
                2,924
                
                
                5,232
                
                
                5,582**Net
                    interest income**
                
                
                2,214
                
                
                2,978
                
                
                4,739
                
                
                5,803Provision
                    for loan losses
                
                
                443
                
                
                334
                
                
                684
                
                
                812**Net
                    interest income after provision for loan losses**
                
                
                1,771
                
                
                2,644
                
                
                4,055
                
                
                4,991**Other
                  income**Service
                    charges on deposit accounts
                
                
                233
                
                
                343
                
                
                466
                
                
                655Financial
                    service fees
                
                
                59
                
                
                50
                
                
                120
                
                
                106Mortgage
                    origination fees
                
                
                36
                
                
                233
                
                
                69
                
                
                430Loss
                    on sale of foreclosed properties
                
                
                (65
                )
                
                (30
                )
                
                (64
                )
                
                (29
                )Gain
                    (loss) on sale of fixed assets
                
                
                221
                
                
                1
                
                
                221
                
                
                (23
                )Increase
                    in cash surrender value of bank owned life insurance
                    policies
                
                
                67
                
                
                62
                
                
                130
                
                
                122Other
                    operating income
                
                
                51
                
                
                95
                
                
                111
                
                
                145**Total
                    other income**
                
                
                602
                
                
                754
                
                
                1,053
                
                
                1,406**Other
                  expenses**Salaries
                    and employee benefits
                
                
                1,263
                
                
                1,291
                
                
                2,374
                
                
                2,718Equipment
                    and occupancy expense
                
                
                305
                
                
                318
                
                
                583
                
                
                635Marketing
                    expense
                
                
                53
                
                
                53
                
                
                90
                
                
                91Data
                    processing expense
                
                
                148
                
                
                179
                
                
                312
                
                
                341Administrative
                    expenses
                
                
                194
                
                
                192
                
                
                395
                
                
                603Legal
                    and professional
                
                
                117
                
                
                149
                
                
                200
                
                
                258Directors
                    fees
                
                
                72
                
                
                62
                
                
                156
                
                
                128Amortization
                    of intangible assets
                
                
                9
                
                
                11
                
                
                18
                
                
                21Stationery
                    and supply expense
                
                
                33
                
                
                52
                
                
                68
                
                
                114Other
                    operating expenses
                
                
                109
                
                
                193
                
                
                238
                
                
                358**Total
                    other expense**
                
                
                2,303
                
                
                2,500
                
                
                4,434
                
                
                5,267**Income
                    before income taxes**
                
                
                70
                
                
                898
                
                
                674
                
                
                1,130Income
                    tax expense
                
                
                (1
                )
                
                286
                
                
                191
                
                
                359**Net
                    Income**
                
                
                71
                
                
                612
                
                
                483
                
                
                771Basic
                    earnings per share
                
                $
                0.02
                
                $
                0.21
                
                $
                0.16
                
                $
                0.26Diluted****earnings
                    per share
                
                $
                0.02
                
                $
                0.20
                
                $
                0.16
                
                $
                0.26Weighted
                    average common shares outstanding
                
                
                3,071,883
                
                
                2,929,516
                
                
                3,030,244
                
                
                2,922,284Weighted
                    average diluted common shares outstanding
                
                
                3,133,957
                
                
                3,006,290
                
                
                3,099,647
                
                
                3,010,042Dividends
                    declared per share
                
                $
                .02
                
                $
                .02
                
                $
                .04
                
                $
                .04




4




**Community
        Capital Bancshares, Inc.**
 **and
        Subsidiaries**
 **Consolidated
        Statements of Comprehensive Income (unaudited)**
 Three
        and
        six months ended June 30, 2007 and 2006
 (Dollars
        in thousands)




Three
                Months Ended
            
            Six
                Months EndedJune
                30,
              2007
            
            
            June
                30,
              2006
            
            
            June
                30,
              2007
            
            
            June
                30,
              2006**Net
                Income**
            
            $
            71
            
            $
            612
            
            $
            483
            
            $
            771Other
                comprehensive income (loss)Net
                unrealized holding losses arising during the period.
            
            
            (485
            )
            
            (518
            )
            
            (336
            )
            
            (620
            )Tax
                benefit on unrealized holding losses
            
            
            165
            
            
            176
            
            
            114
            
            
            211**Comprehensive
                income (loss)**
            
            $
            (249
            )
            $
            270
            
            $
            261
            
            $
            362








5




**Community
        Capital Bancshares, Inc.**
 **and
        Subsidiaries**
 **Consolidated
        Statements of Cash Flows (unaudited)**
 Six
        Months ended June 30, 2007 and 2006
 (Dollars
        in thousands)




2007
              
              
              2006**Cash
                  Flows from operating activities:**Net
                  income
              
              $
              483
              
              $
              771Adjustments
                  to reconcile net income to net cash provided by operating
                  activities:Depreciation
              
              
              223
              
              
              236Amortization
                  of core deposit premium
              
              
              18
              
              
              21Provision
                  for loan losses
              
              
              684
              
              
              812Provision
                  for deferred taxes
              
              
              (143
              )
              
              (73
              )Stock
                  option expense
              
              
              58
              
              
              56(Increase)
                  decrease in interest receivable
              
              
              567
              
              
              (237
              )Gain
                  on sale of fixed assets
              
              
              (221
              )
              
              -
                  -Loss
                  on sale of other real estate owned
              
              
              64
              
              
              29Other
                  operating activities
              
              
              (1,899
              )
              
              1,044Net
                  cash provided by operating activities
              
              
              (166
              )
              
              2,659**Cash
                  Flows from Investing Activities:**Purchase
                  of property and equipment
              
              
              (147
              )
              
              (1,420
              )Proceeds
                  from sale of fixed assets
              
              
              3,251
              
              
              -
                  -Net
                  (increase) decrease in federal funds sold
              
              
              (19,107
              )
              
              5,693Net
                  (increase) decrease in loans
              
              
              48,868
              
              
              (38,163
              )Proceeds
                  from maturities of securities available for sale
              
              
              589
              
              
              1,273Proceeds
                  from sale of other real estate owned
              
              
              616
              
              
              260Proceeds
                  from sale of securities
              
              
              1,000
              
              
              -
                  -Purchase
                  of securities available for sale
              
              
              (6,370
              )
              
              (2,113
              )Net
                  cash provided by (used) in investing activities
              
              
              28,700
              
              
              (34,470
              )**Cash
                  Flows from Financing Activities:**Net
                  increase (decrease) in deposits
              
              
              (30,933
              )
              
              40,291Dividends
                  paid to shareholders
              
              
              (123
              )
              
              (121
              )Proceeds
                  from exercise of stock options
              
              
              272
              
              
              539Net
                  decrease in other borrowings
              
              
              -
                  -
              
              
              (8,000
              )Treasury
                  stock transactions, net
              
              
              44
              
              
              -
                  -Net
                  cash provided by(used) in financing activities
              
              
              (30,740
              )
              
              32,709Net
                  increase (decrease) in cash
              
              
              (2,206
              )
              
              898Cash
                  and due from banks at beginning of period
              
              
              7,408
              
              
              6,931Cash
                  and due from banks at end of period
              
              
              5,202
              
              
              7,829**Supplemental
                  Disclosure**Cash
                  paid for interest
              
              $
              5,403
              
              $
              5,254Income
                  taxes
              
              $
              328
              
              $
              200**Non-Cash
                  Transaction**Other
                  real estate acquired in settlement of loans
              
              
              1,460
              
              
              775Unrealized
                  losses on securities available for sale
              
              $
              336
              
              $
              620




6




**Community
      Capital Bancshares, Inc.**


**and
      Subsidiaries**


**Notes
      to Financial Statements**





**Note
      1. Organization and Summary of Significant Accounting
      Policies**





**Nature
      of Business**





Community
      Capital Bancshares, Inc. (the “Company”) is a multi-bank holding company whose
      principal activity is the ownership and management of its wholly-owned bank
      subsidiaries, Albany Bank and Trust, N.A, and AB & T National Bank, N. A.,
      collectively referred to as “the Banks.” Albany Bank and Trust’s main office is
      located in Albany, Dougherty County, Georgia, with one additional full service
      branch in Albany and one full service branch in Leesburg, Georgia. AB&T
      National Bank’s main office is located in Dothan, Houston County, Alabama and
      has a full service branch located in Auburn, Alabama. The Banks provide a full
      range of banking services to individual and corporate customers in their primary
      market areas.





**Basis
      of Presentation**





The
      consolidated financial statements include the accounts of the Company and its
      subsidiaries. Significant intercompany transactions and balances have been
      eliminated in consolidation.





In
      preparing the consolidated financial statements in conformity with generally
      accepted accounting principles, management is required to make estimates and
      assumptions that affect the reported amounts of assets and liabilities and
      the
      disclosure of contingent assets and liabilities as of the date of the balance
      sheet and reported amounts of revenues and expenses during the reporting period.
      Actual results could differ from those estimates.





Material
      estimates that are particularly susceptible to significant change in the
      near-term relate to the determination of the allowance for loan losses, the
      valuation of foreclosed real estate, goodwill, intangible assets, deferred
      tax
      assets and contingent assets and liabilities. The determination of the adequacy
      of the allowance for loan losses is based on estimates that are susceptible
      to
      significant changes in the economic environment and market conditions. In
      connection with the determination of the estimated losses on loans and the
      valuation of foreclosed real estate, management obtains independent appraisals
      for significant collateral. Intangible assets, primarily goodwill and core
      deposit premiums, are evaluated annually for impairment.





The
      interim financial statements included herein are unaudited but reflect all
      adjustments which, in the opinion of management, are necessary for a fair
      presentation of the financial position and results of operations for the interim
      period presented. All such adjustments are of a normal recurring nature. The
      results of operations for the periods ended June 30, 2007 and 2006 are not
      necessarily indicative of the results of a full year’s operations, and should be
      read in conjunction with the Company’s annual report for the year ended December
      31, 2006 as filed on Form 10-K.





The
      accounting principles followed by the Company and the methods of applying these
      principles conform with accounting principles generally accepted in the United
      States of America (GAAP) and with general practices within the banking
      industry.








7




**Income
      Taxes**





Deferred
      income tax assets and liabilities are determined using the balance sheet method.
      Under this method, the net deferred tax asset or liability is determined based
      on the tax effects of the temporary differences between the book and tax basis
      of the various balance sheet assets and liabilities and gives current
      recognition to changes in the tax rates and laws.





The
      Company and its subsidiaries file a consolidated income tax return. Each entity
      provides for income taxes based on its contribution to the income taxes
      (benefits) of the consolidated group.








**Stock
      Compensation Plans**





At
      June
      30, 2007, the Company had two fixed stock option plans under which it had
      granted options to its employees and directors to purchase common stock at
      the
      fair market price on the date of the grant. Both plans provide for “incentive
      stock options” and “non-qualified stock options”. The incentive stock options
      are intended to qualify under Section 442 of the Internal Revenue Code for
      favorable tax treatment.





On
      March
      11, 1999, the Company’s shareholders approved the 1998 Stock Incentive Plan
      under which options to purchase 303,574 shares of its common stock may be
      granted to directors, officers and employees. Both incentive stock options
      and
      nonqualified stock options may be granted under the plan. At June 30, 2007,
      there were 103,647 shares available under the plan.





On
      April
      24, 2000, the Board of Directors adopted the 2000 Outside Directors Stock Option
      Plan under which nonqualified stock options to purchase up to 21,429 shares
      of
      the Company’s common stock may be granted to directors who are not employees of
      the Company or any of its affiliates and to the Chairman of the Board of
      Directors, regardless of whether he is an employee of the Company. The plan
      provides for an annual grant of a nonqualified stock option to purchase 142
      shares of the Company’s common stock to each existing non-employee director and
      a nonqualified stock option to purchase 285 shares of the Company’s common stock
      to the Chairman of the Board of Directors as of the date of each annual
      shareholders’ meeting. Options granted pursuant to this plan are generally
      nontransferable except by will or the laws of descent and distribution unless
      otherwise permitted by the Board of Directors. These options are fully vested
      and exercisable immediately, subject to any restriction imposed by the primary
      federal regulator of the Company. The exercise price of these options must
      be
      equal to the fair market value of the common stock on the date the option is
      granted. The term of the options may not exceed ten years from the date of
      grant. At June 30, 2007 there were 4,381 shares available for issuance under
      this plan.





The
      Company has issued non-qualified stock options to its Chairman and members
      of
      senior management in previous years totaling 71,428 shares. Additionally 302,420
      warrants were issued to founding directors of the Company. These options and
      warrants are described in more detail in the Annual Report on Form 10-K for
      the
      year ended December 31, 2006.





As
      of
      June 30, 2007 there was $214,000 in unrecognized compensation expense which
      will
      be recognized over 2.5 years.








**Accounting
      Standards**





In
      September 2006, the Financial Accounting Standards Board (“FASB”) issued SFAS
      157, Fair Value Measurements. The standard provides guidance for using fair
      value to measure assets and liabilities. It defines fair value, establishes
      a
      framework for measuring fair value under generally accepted accounting
      principles and expands disclosures about fair value measurement. Under the
      standard, fair value refers to the price that would be received to sell an
      asset
      or paid to transfer a liability in an orderly transaction between market
      participants in the market in which the reporting entity transacts. It clarifies
      the principle that fair value should be based on the assumptions market
      participants would use when pricing the asset or liability. In support of this
      principle, the standard establishes a fair value hierarchy that prioritizes
      the
      information used to develop those assumptions. Under the standard, fair value
      measurements would be separately disclosed by level within the fair value
      hierarchy. Statement 157 is effective for financial statements issued for fiscal
      years beginning after November 15, 2007. The Company is currently evaluating
      the
      impact the adoption of this statement could have on its financial condition,
      results of operations and cash flows.




8





**Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations**





This
      discussion is intended to assist in an understanding of the Company's financial
      condition and results of operations. This analysis should be read in conjunction
      with the financial statements and related notes appearing in Item 1 of this
      Form
      10-Q and Management's Discussion and Analysis of Financial Condition and Results
      of Operations appearing in the Company's Form 10-K for the year ended December
      31, 2006.





**Financial
      Condition**





As
      of
      June 30, 2007 the Company’s total assets were $266,504,000 representing a
      decrease of $30,432,000, or 10.25%, from December 31, 2006. Earning assets
      consist of federal funds sold, investment securities and loans. These assets
      provide the majority of the Company’s earnings.




Federal
      funds sold represent an overnight investment of funds and can be converted
      immediately to cash. At June 30, 2007, the Company had $25,507,000 in federal
      funds sold. At December 31, 2006, the Company had federal funds sold of
      $6,400,000. The $19,107,000 increase in federal funds sold during the first
      two
      quarters was a result of the payoff of loans in the Company’s former loan
      production office in Charleston, South Carolina. Loans originated by the former
      Charleston office decreased $28,103,000 during the first six months of 2007
      and
      have not yet been replaced by other loans. The majority of these payoffs
      occurred during the second quarter of 2007.




Investment
      securities consist of U.S. Government and Agency securities and municipal bonds.
      These investments are used to provide fixed maturities and as collateral for
      advances and large public fund deposits. From December 31, 2006 to June 30,
      2007, investment securities increased by $4,289,000. This increase was due
      to
      the increased liquidity available from the loan reductions late in the second
      quarter of 2007. All securities are classified as available for sale, and are
      carried at current market values.




The
      loan
      portfolio is the largest earning asset and is the primary source of earnings
      for
      the Company. At June 30, 2007 net loans were $170,571,000. The loan portfolio
      decreased $49,552,000 or 22.51% since December 31, 2006. This decrease is
      primarily the result of repayments from the loans originated in the Charleston
      market. At June 30, 2007, the allowance for loan losses was $5,821,000 or 3.30%
      of total loans. Management believes this is an adequate but not excessive amount
      based upon the composition of the current loan portfolio and current economic
      conditions. The relationship of the allowance to total loans will vary over
      time
      based upon management’s evaluation of the loan portfolio. Management evaluates
      the adequacy of the allowance on a quarterly basis and adjusts it accordingly
      by
      a periodic charge to earnings using the provision for loan losses. During the
      first two quarters of 2007, the provision for potential loan losses was $684,000
      as compared to the 2006 amount of $812,000. The reserve was based upon
      management’s estimate to provide for potential loan losses in the current
      portfolio and to replenish the reserve for $370,000 of net charge offs during
      the first two quarters. During its regular review of loans during the quarter,
      management identified a single large construction loan on which funds were
      advanced disproportionably to its estimated completion. Based upon this review
      and the potential loss on this loan, an additional $300,000 was required to
      be
      added to the allowance for loan losses.




Non-earning
      assets consist of premises and equipment, and other assets. Premises and
      equipment decreased during the year as a result of the Company’s separation from
      the Charleston office and depreciation expense during the first two quarters.
      Other assets consist primarily of bank-owned life insurance, other real estate
      owned, and accrued interest receivable. Bank-owned life insurance and other
      real
      estate owned increased $118,000 and $780,000 respectively over the year end
      amount. Accrued interest receivable decreased $567,000 over the previous year
      end amount as a result of a smaller loan portfolio upon which to accrue
      interest.






9




The
      Company funds its assets primarily through deposits from customers.
      Additionally, it borrows funds from other sources to provide longer term fixed
      rate funding for its assets. The Company must pay interest on the majority
      of
      these funds and attempts to price these funds competitively in the market place
      but at a level at which it can safely re-invest the funds profitably. At June
      30, 2007, total deposits were $206,620,000 as compared to the year-end amount
      of
      $237,553,000. This is a decrease of $30,933,000 or 13.02%. The decreased
      deposits were primarily a result of maturing wholesale certificates of
      deposit of $19,261,000 and maturing brokered deposits of $9,938,000 during
      the
      first two quarters of 2007.




Interest
      bearing deposits are comprised of the following categories:




June
                  30, 2007
              
              
              December
                  31, 2006Interest
                  bearing demand and savings
              
              $
              58,597,000
              
              $
              61,242,000Certificates
                  of deposit in denominations of $100,000 or greater
              
              
              72,581,000
              
              
              96,977,000Other
                  certificates of deposit
              
              
              56,385,000
              
              
              59,854,000Total
              
              $
              187,563,000
              
              $
              218,073,000





Other
      borrowings consist of Federal Home Loan Bank advances and are secured by
      investment securities and loans of Albany Bank & Trust. There was no
      activity in other borrowings during the quarter.




**Capital
      Adequacy**




The
      following table presents the Company’s regulatory capital position as of June
      30, 2007.




Tier
                  1 Capital to risk weighted assets Ratio, actual
              16.81%Tier
                  1 Capital minimum requirement
              4.00%Tier
                  2 Capital to risk weighted assets Ratio, actual
              18.09%Tier
                  2 Capital minimum requirement
              8.00%Tier
                  1 Leverage Ratio
              11.00%Tier
                  1 Leverage Ratio minimum requirement
              4.00%




The
      Company’s ratios are well above the required regulatory minimums under capital
      adequacy guidelines and provide a sufficient basis to support future growth
      of
      the Company. The Banks remain above the required regulatory capital minimums
      and
      the Company has the ability to support the Banks’ capital levels should the need
      arise.






**Results
      of operations**




**For
      the quarter end compared to prior year quarter end**




Net
      income for the three months ended June 30, 2007 was $71,000 as compared to
      $612,000 for the same period in 2006.





Total
      interest income decreased $1,178,000 or 19.6% for the three months ended June
      30
      2007 compared to the same period in the previous year. This was the result
      of
      decreased interest income on loans, due primarily to the smaller loan portfolio
      in the current year.





Interest
      expense for the three months ended June 30, 2007 was $2,511,000, which is a
      decrease of $413,000 or 14.12% over the same period in the previous year. This
      decrease is primarily indicative of the smaller deposit base in the current
      year.




10




Net
      interest income after the provision for loan losses was $1,771,000 for the
      three
      months ended June 30, 2007 as compared to the 2006 amount of $2,644,000. This
      is
      a decrease of $873,000, or 33.02%. This decrease is the combined result of
      the
      decreased level of earning assets and interest bearing liabilities.





Other
      noninterest income decreased $152,000 to $602,000 for the three months ended
      June 30, 2007 as compared to the same period in 2006. Service charges on deposit
      accounts decreased $110,000, or 32.07%, due to the smaller number of deposit
      accounts. Mortgage origination fees decreased $197,000 to $36,000 when compared
      to the same period in 2006. This decrease is the result of the separation from
      the Charleston loan production office.





Non-interest
      expense decreased $197,000 to $2,303,000 for the three months ended June 30,
      2007 as compared to the same period in 2006. This is a decrease of 7.88%. The
      largest area of decrease was in the other operating expense category. Other
      operating expense amounted to $109,000 for the three months ended June 30,
      2007
      as compared to the 2006 amount of $193,000. This decrease of $84,000 or 43.52%
      was primarily the result of expenses no longer incurred due to the separation
      from the Charleston loan production office, which included travel, airplane
      costs and meals and entertainment expense.





Legal
      and
      professional fees decreased $32,000, or 21.48%, for the three months ended
      June
      30, 2007 from the same period in 2006. These fees were higher during the second
      quarter of 2006 due to the legal fees incurred in connection with the response
      to the Agreements between each of the Banks and the OCC (collectively, the
“OCC
      Agreements”) and the Company’s separation from the Charleston loan production
      office.





Diluted
      earnings per share for the three months ended June 30, 2007 were $0.02 and
      decreased $0.18 or 90.00% as compared to the second quarter of the previous
      year.






**For
      the year to date comparison to prior year**





Net
      income for the six months ended June 30, 2007 was $482,000 as compared to
      $771,000 for the same period in 2006.





Total
      interest income decreased $1,414,000 for the six months ended June 30 2007
      or
      12.42% from the same period in the previous year. This was the result of
      decreased interest income on loans, which decreased $1,353,000 over the same
      period in the previous year. The decrease in interest income was primarily
      the
      result of the smaller loan portfolio in the current year.





Interest
      expense for the six months ended June 30, 2007 was $5,232,000, which is a
      decrease of $350,000 over the same period in the previous year. This decrease
      is
      indicative of the smaller deposit base in the current year.





Net
      interest income after the provision for loan losses was $4,055,000 for the
      six
      months ended June 30, 2007 as compared to the 2006 amount of $4,991,000. This
      is
      a decrease of $936,000 or 18.75%. This decrease is the combined result of the
      decreased level of earning assets, offset by the decrease in cost of funds
      during the current year. The largest area of loan runoff during the past year
      has been loans originated by the Charleston loan production office which has
      decreased by over $28,000,000 since December 31, 2006. In addition, the other
      branches of Albany Bank and Trust reduced loans by over $15,000,000 and AB&T
      National Bank, reduced loans by nearly $6,000,000 compared to the prior year
      end
      amount in order to comply with the requirements of the OCC
      Agreements.




Other
      noninterest income decreased $353,000 to $1,053,000 for the six months ended
      June 30, 2007 as compared to the same period in 2006. Service charges on deposit
      accounts decreased $189,000, or 28.85%, due to the smaller number of deposit
      accounts. Mortgage origination fees decreased $361,000 to $69,000 during the
      year due to the separation from the Charleston loan production office. These
      decreases were offset by the gain on sale of fixed assets of $221,000 in
      conjunction with the sale in June 2007 of the building that housed the
      Charleston loan production office.




11





Non-interest
      expense decreased $833,000 to $4,434,000 for the six months ended June 30,
      2007
      as compared to the same period in 2006. This is a decrease of 15.82%. The
      largest dollar decrease was in the salary and employee benefits category.
      Salaries and benefits amounted to $2,374,000 for the six months ended June
      30,
      2007 as compared to the 2006 amount of $2,718,000. This decrease of $344,000,
      or
      12.66%, was due primarily to the separation from the Charleston loan production
      office.





Administrative
      expenses decreased $208,000 or 34.49% for the six months ended June 30, 2007
      from the same period in 2006. The decrease is a result of reduced consultant
      fees of $302,000 as compared to the prior year amount. The 2006 expenditure
      was
      paid for in conjunction with a study to improve non-interest income. This
      decrease is offset by an increase in OCC exam fees of $44,000 as compared to
      the
      prior year amount.




Diluted
      earnings per share for the six months ended June 30, 2007 were $0.16 and
      decreased $0.10, or 38.46%, as compared to the first six months of the previous
      year.





**Off-Balance
      Sheet Arrangements**





Our
      financial statements do not reflect various commitments and contingent
      liabilities that arise in the normal course of business. These off-balance
      sheet
      financial instruments include commitments to extend credit and standby letters
      of credit. Such financial instruments are included in the financial statements
      when funds are distributed or when the instruments become payable. Our exposure
      to credit loss in the event of nonperformance by the other party to a financial
      instrument for commitments to extend credit, and standby letters of credit
      is
      represented by the contractual amount of those instruments. We use the same
      credit policies in making commitments as we do for on-balance sheet instruments.
      Although these amounts do not necessarily


represent
      future cash requirements, a summary of our commitments as of June 30, 2007
      and
      December 31, 2006 are as follows:





June-07
            
            
            Dec-06Commitments
                to extend credit
            
            $
            44,178,000
            
            $
            57,958,000Standby
                letters of credit
            
            $
            1,020,000
            
            $
            1,020,000




**LIQUIDITY
      AND CAPITAL RESOURCES**





Liquidity
      is an important factor in our financial condition and affects our ability to
      meet the borrowing needs and deposit withdrawal requirements of our customers.
      Assets, consisting primarily of loans and investment securities, are funded
      by
      customer deposits, borrowed funds, and retained earnings. Maturities in the
      investment and loan portfolios also provide a steady flow of funds for
      reinvestment. In addition, our liquidity continues to be enhanced by a
      relatively stable core deposit base and the availability of additional funding
      sources. Management monitors its future liquidity needs based upon quarterly
      projections of loan and deposit growth. Management feels that it has sufficient
      capital and liquidity resources to support its future growth.




**REGULATORY
      MATTERS**





On
      July
      27, 2006, each of the Banks entered into the Agreements with the OCC. The
      Agreements were described in the Form 8-K filed on August 2, 2006. In order
      to
      comply with the Agreements, the Company has decreased its total assets in order
      to reach specified capital levels. Future growth in assets will be dependent
      upon the Banks having adequate capital to fund the growth.




12




**Forward-Looking
      Statements**





This
      document contains statements that constitute “forward-looking statements” within
      the meaning of Sections 27A of the Securities Act of 1933, as amended, and
      Sections 21E of the Securities Exchange Act of 1934, as amended. The words
      “believe”, “estimate”, “expect”, “intend”, “anticipate” and similar expressions
      and variations thereof identify certain of such forward-looking statements,
      which speak only as of the dates that they were made. The Company undertakes
      no
      obligation to publicly update or revise any forward-looking statements, whether
      as a result of new information, future events, or otherwise. Users are cautioned
      that any such forward-looking statements are not guarantees of future
      performance and involve risks and uncertainties that the actual results may
      differ materially from those indicated in the forward-looking statements as
      a
      result of various factors. For a discussion of the factors, risks and
      uncertainties that could cause our actual results to differ materially from
      estimates and projections contained in these forward-looking statements, please
      read the “Risk Factors” section of our report on Form 10-K for the year ended
      December 31, 2006. Users are cautioned not to place undue reliance on these
      forward-looking statements.





**ITEM
      3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
      RISK**





Market
      risk is a risk of loss arising from adverse changes in market prices and rates.
      The Company's market risk is composed primarily of interest rate risk created
      by
      its lending and deposit taking activities. The primary purpose of managing
      interest rate risk is to reduce the effects of interest rate volatility on
      our
      financial condition and results of operations. As interest rates change, the
      interest income and expense associated with the Company’s interest sensitive
      assets and liabilities also change, thereby impacting net interest income,
      the
      primary component of the Company’s earnings. Management addresses this risk
      through an active asset/liability management process and through management
      of
      maturities and repricing of interest-earning assets and interest-bearing
      liabilities. The Company's market risk and strategies for market risk management
      are more fully described in Annual report of Form 10-K for the year ended
      December 31, 2006. There have been no changes in the assumptions used in
      monitoring interest rate risk as of June 30, 2007. Through June 30, 2007,
      management has not utilized derivatives as a part of this process.





The
      Company’s income simulation analysis projected net interest income based on both
      an immediate rise and fall in interest rates of 100 and 200 basis points (i.e.
      2.00%) over a twelve-month period. Given this scenario, the Company had, as
      of
      June 30, 2007, a benefit to rising rates and an exposure from falling rates.
      The
      forecasted results of the model are within the limits specified by the Company’s
      asset/liability management program. The following table reflects the Company’s
      sensitivity to changes in interest rates as of June 30, 2007 ,
      showing
      the percentage change in net interest income given the change in interest
      rates.




**Interest
      Rate Risk: Income Sensitivity Summary**




Market
                Rate Change
            
            
            Effect
                on
              Net
              Interest
              Income(Immediate)+200
                bps
            
            
            .82
            %+100
                bps
            
            
            .57
            %-100
                bps
            
            
            -1.82
            %-200
                bps
            
            
            -3.87
            %





13




As
      market
      conditions vary from those assumed in the sensitivity analysis, actual results
      will differ. Also, the sensitivity analysis does not reflect actions that the
      Company might take in responding to or anticipating changes in interest
      rates.








**ITEM
      4. CONTROLS AND PROCEDURES**





As
      of the
      end of the period covered by this Quarterly Report on Form 10-Q, our principal
      executive officer and principal financial officer have evaluated the
      effectiveness of our "disclosure controls and procedures" ("Disclosure
      Controls"). Disclosure Controls, as defined in Rule 13a-15(e) of the Securities
      Exchange Act of 1934, as amended (the "Exchange Act"), are procedures that
      are
      designed with the objective of ensuring that information required to be
      disclosed in our reports filed under the Exchange Act, such as this Quarterly
      Report, is recorded, processed, summarized and reported within the time periods
      specified in the Securities and Exchange Commission's rules and forms.
      Disclosure Controls are also designed with the objective of ensuring that such
      information is accumulated and communicated to our management, including our
      principal executive officer and principal financial officer, as appropriate
      to
      allow timely decisions regarding required disclosure.





Our
      management, including our principal executive officer and principal financial
      officer, does not expect that our Disclosure Controls will prevent all error
      and
      all fraud. A control system, no matter how well conceived and operated, can
      provide only reasonable, not absolute, assurance that the o bjectives
      of the control system are met. Further, the design of a control system must
      reflect the fact that there are resource constraints, and the benefits of
      controls must be considered relative to their costs. Because of the inherent
      limitations in all control systems, no evaluation of controls can provide
      absolute assurance that all control issues and instances of fraud, if any,
      within the company have been detected. These inherent limitations include the
      realities that judgments in decision-making can be faulty, and that breakdowns
      can occur because of simple error or mistake. The design of any system of
      controls also is based in part upon certain assumptions about the likelihood
      of
      future events, and there can be no assurance that any design will succeed in
      achieving its stated goals under all potential future conditions.





Based
      upon their controls evaluation, our principal executive officer and principal
      financial officer have concluded that our Disclosure Controls are effective
      at a
      reasonable assurance level.





There
      have been no changes in our internal controls over financial reporting during
      our first six months of the fiscal year that have materially affected, or are
      reasonably likely to materially affect, our internal control over financial
      reporting.





14


**PART
      II**





**ITEM
              1.**
            **Legal
                Proceedings**


None








**ITEM
              1.A.**
            **Risk
                Factors**





You
      should carefully consider the risk factors discussed in Item 1A of Part I of
      our
      Annual Report on Form 10-K for the year ended December 31, 2006, which could
      materially affect our business, financial condition or future results. The
      risks
      described in our Annual Report on Form 10-K are not the only risks facing our
      Company. Additional risks and uncertainties not currently known to us or that
      we
      currently deem to be immaterial also may materially adversely affect our
      business, financial condition and/or operating results.





**ITEM
              2.**
            **UNREGISTERED
                SALES OF EQUITY SECURITIES AND USE OF
                PROCEEDS**


(a)  None


(b)  None


(c)  None




**ITEM
              3.**
            **DEFAULTS
                UPON SENIOR SECURITIES**


None





**ITEM
              4.**
            **SUBMISSION
                OF MATTERS TO A VOTE OF SECURITY HOLDERS**


On
      May
      21, 2007, the Company held its annual meeting of shareholders at which the
      following director nominees were elected to a three-year term expiring in 2010
      by the votes indicated:




Directors
            
            Votes
                For
            
            Votes
                WithheldC.
                Richard Langley
            
            2,340,847
            
            547,178Jane
                Anne D. Sullivan
            
            2,385,551
            
            502,474James
                D. Woods
            
            2,320,462
            
            502,474Bennett
                D. Cotton, Jr.
            
            2,320,462
            
            502,474John
                P. Ventulett, Jr.
            
            2,320,462
            
            502,474




The
      following directors whose three year terms expire in 2008 continued on the
      Board: Glenn A. Dowling, Mary Helen Dykes, Mark M. Shoemaker, and Lawrence
      B.
      Willson. The following directors whose three year terms expire in 2009,
      continued on the Board: Keith G. Beckham, Charles M. Jones, III, Van Cise
      Knowles, William F. McAfee, and John H. Monk, Jr.







**ITEM
              5.**
            **OTHER
                INFORMATION**


None





**Item
              6.**
            **Exhibits**


**31.1**
            Certification
                of the Chief Executive officer pursuant to Rule 13a-14(a) under the
                Securities exchange act of 1934, as
                amended.





**31.2**
            Certification
                of the Chief Financial Officer pursuant toRule
                13a-14(a) under the Securities exchange act of 1934, as
                amended.




**32.1**
            Certification
                  of the Chief Executive Officer and Chief Financial Officer pursuant
                  to
                  Rule 13a-14(b) under the Securities exchange act of 1934, as
                  amended.  15


**SIGNATURES**








Pursuant
      to the requirements 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.











**Community
      Capital Bancshares, Inc.**





August
                  14, 2007
              
              /s/
                  John H. Monk, Jr.Date
              
              John
                  H. Monk, Jr.Chief
                  Executive Officer
 
 August
                    14, 2007
                
                /s/
                    David J. BarankoDate
                
                David
                    J. BarankoChief
                    Financial Officer
                  (Duly
                    authorized officer and principal financial / accounting
                    officer)
 
  16