<PAGE>

                   U. S. Securities and Exchange Commission

                            Washington, D.C. 20549

                                  FORM 10-KSB

     [X]  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE  SECURITIES EXCHANGE
          ACT OF 1934
                  For the fiscal year ended December 31, 2000

     [_]  TRANSITION REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES
          EXCHANGE ACT OF 1934
                For the transition period from __________ to

                        Commission file number 0-19030

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION
                (Name of small business issuer in its charter)

        Georgia                                                58-1856582
(State of incorporation)                                    (I.R.S. Employer
                                                           Identification No.)

             342 Marietta Highway, Suite 110, Hiram, Georgia 30141
              (Address of principal executive offices)(Zip Code)

                                (678) 363-3828
                (Issuer's telephone number including area code)

       Securities registered pursuant to Section 12(b) of the Act: None

          Securities registered pursuant to Section 12(g) of the Act:

                         Common Stock, $2.50 par value
                               (Title of Class)

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 ___
                                                               ---

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ ]

     Revenues for the Registrant's fiscal year ended December 31, 2000, total
                                 $15,527,092.

The aggregate market value of the Registrant's outstanding Common Stock held by
nonaffiliates of the Registrant on March 26, 2001 was $24,595,699.  There were
2,405,789 shares of Common Stock outstanding as of March 26, 2001.

                      DOCUMENTS INCORPORATED BY REFERENCE
                      -----------------------------------

   Transitional Small Business Disclosure Format (check one): Yes ___; No X
                                                                          -
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION
                         Annual Report on Form 10-KSB
                  For the Fiscal Year Ended December 31, 2000


                               Table of Contents
                               -----------------

<TABLE>
<CAPTION>
Item                                                                      Page
Number                                                                    Number
------                                                                    ------
<S>                                                                       <C>
                                    Part I

  1.    Description of Business..........................................      2

  2.    Description of Property..........................................     34

  3.    Legal Proceedings................................................     35

  4.    Submission of Matters to a Vote of Security Holders..............     35

                                    Part II

  5.    Market for Common Equity and Related Stockholder Matters.........     35

  6.    Management's Discussion and Analysis and Results of
        Operations.......................................................     36

  7.    Financial Statements.............................................     46

  8.    Changes in and Disagreements with Accountants on
        Accounting and Financial Disclosure..............................     69

                                   Part III

  9.    Directors, Executive Officers, Promoters and Control Persons;
        Compliance with Section 16(a) of the Exchange Act................     69

  10.   Executive Compensation...........................................     72

  11.   Security Ownership of Certain Beneficial Owners
        and Management...................................................     77

  12.   Certain Relationships and Related Transactions...................     79

  13.   Exhibits and Reports on Form 8-K.................................     79

        Signatures.......................................................     83

        Index of Exhibits................................................     85
</TABLE>
<PAGE>

                                    PART I
                                    ------



ITEM 1.  DESCRIPTION OF BUSINESS
--------------------------------


Forward-Looking Statements
--------------------------

     This report contains certain forward-looking statements including
statements relating to present or future trends or factors generally affecting
the banking industry and specifically affecting operations, markets and
products.  Without limiting the foregoing, the words "believes", "anticipates",
"intends", "expects" or similar expressions are intended to identify forward-
looking statements.  These forward-looking statements involve certain risks and
uncertainties.  Actual results could differ materially from those projected for
many reasons including, without limitation, changing events and trends that have
influenced assumptions.  These trends and events include (i) changes in the
interest rate environment which may reduce margins, (ii) non-achievement of
expected growth, (iii) less favorable than anticipated changes in national and
local business environment and securities markets, (iv) adverse changes in the
regulatory requirements, (v) greater competitive pressures among financial
institutions in the market, and (vi) greater than expected loan losses.
Additional information and other factors that could affect future financial
results are included in filings with the Securities and Exchange Commission,
including this Annual Report on Form 10-KSB for 2000.


Overview
--------

The Company

     Community Trust Financial Services Corporation (the "Company") was
incorporated under the laws of the State of Georgia at the direction of
Community Trust Bank (the "Bank") for the purpose of becoming a bank holding
company for the Bank.  On February 22, 1991, following the receipt of all
requisite corporate and regulatory approvals, the Bank became a wholly-owned
subsidiary of the Company, and the shareholders of the Bank became shareholders
of the Company, with the same proportional interests in the Company as they
previously held in the Bank (the "Reorganization").  Following the
Reorganization, the Bank has continued its business operations as a Georgia-
chartered commercial bank under the same name, articles of incorporation and
bylaws.

     The primary activity of the Company currently is the ownership and
operation of the Bank.  As a bank holding company, the Company is intended to
facilitate the Bank's ability to serve its customers' requirements for financial
services.  The holding company structure also provides flexibility for expansion
through the possible acquisition of other financial institutions and the
provision of additional banking-related services, as well as certain non-banking
services, which a traditional commercial bank may not provide under present
laws.  The holding company structure also affords additional flexibility in
terms of capital formation and financing opportunities.
<PAGE>

     In August 1998, the Company completed a public offering of 588,236 shares
of common stock at a price of $8.50 per share.  The net proceeds of this
offering of $4,821,662, after deducting issuance costs of $178,344, were used to
repay indebtedness of the Company, contribute capital to the Bank, and fund
loans to non-bank subsidiaries.

     In June 1999, the Company acquired certain assets of Drummond Association,
Inc.  These assets primarily consisted of $1,130,152 in loans, which were then
contributed to the portfolio of Community Loan Company ("CLC").  The purchase
price of approximately $1,516,000 was settled with 163,320 restricted shares of
the Company's common stock and approximately $822,000 in cash.

     On December 14, 1999, the Board of Directors of the Company declared a 2-
for-1 stock split to be effected in the form of 100% stock dividend to be
distributed on January 28, 2000 to holders of record on January 18, 2000.  All
share and per share amounts in this document have been changed to reflect the
stock split as if it had occurred on December 31, 1996.

     On March 13, 2001, the Board of Directors of the Company signed a
definitive agreement to merge with GB&T Bancshares, Inc. ("GB&T"), a
Gainesville, Georgia multi-bank holding company. The proposed merger provides
for the conversion of each common share and share equivalent of the Company into
 .786 shares of GB&T stock. The proposed merger is subject to the consent of
various regulatory authorities and shareholder approval.

The Bank

     The Bank's business consists primarily of attracting deposits from the
general public and, with these and other funds, originating real estate loans,
consumer loans, business loans, and residential and commercial construction
loans.  Funds not invested in the loan portfolio are invested by the Bank
primarily in U.S. Government and agency obligations and obligations of various
states and their political subdivisions.  In addition to deposits, sources of
funds for the Bank's loans and other investments include borrowings from the
Federal Home Loan Bank of Atlanta (the "Federal Home Loan Bank"), amortization
and prepayment of loans, sales of loans or participations in loans, sales of its
investment securities, and repurchase agreements.  The principal sources of
income for the Bank are interest and fees collected on loans, fees collected on
deposit accounts and interest and dividends collected on other investments.  The
principal expenses of the Bank are interest paid on deposits, employee
compensation and benefits, office expenses and other overhead expenses.

Other Subsidiaries

     In addition to the Bank, the Company has invested in three non-bank
subsidiaries: CLC; Cash Transactions, LLC ("CashTrans"); and Metroplex
Appraisals, Inc. ("Metroplex").

     In 1995, the Company established CLC as a non-bank subsidiary for the
purpose of engaging in the consumer finance business.  CLC presently operates
from eight offices located in northwest Georgia.  The offices are presently
located in Woodstock, Rockmart, Rossville, Gainesville, Dalton,

                                      -3-
<PAGE>

Rome, Dahlonega, and Cartersville. During 2000, CLC sold assets related to three
consumer finance offices due to geographic considerations.

     In 1997, the Company participated in the establishment of CashTrans.
CashTrans is a limited liability company that is owned 49% by the Company and
51% by an individual who serves as Chairman of CashTrans.  CashTrans is engaged
in the business of providing retail establishments (primarily convenience
stores) with automated teller machines that are owned by CashTrans and that
dispense cash or cash equivalents.  As of 1999, CashTrans diversified its
business into selling the same types of machines to retail establishments, if
the retailer so desires.  While CashTrans remains focused on placing its
machines in space which is strategically located to encourage transactions,
CashTrans will sell machines, thereby earning income on the sales and on future
maintenance of the machines.  CashTrans engages in this business in Georgia,
Florida, South Carolina, North Carolina, Alabama, and Tennessee.

     In 1992, the Company established Metroplex as a non-bank subsidiary for the
purpose of performing appraisals of residential and commercial properties for
the Bank as well as other entities, such as financial institutions, mortgage
companies and insurance companies.  Metroplex is located in Dallas, Georgia.
Since Metroplex represents less than 5% of the Company's consolidated assets and
consolidated net earnings, the financial condition and results of operations of
the Company are not significantly affected by the operations of Metroplex.


Business of the Company
-----------------------

     The Company's earnings depend primarily on the Bank's net interest income,
which is the difference between the interest income it receives from its assets
(primarily its loans and other investments) and the interest expense (or "cost
of funds") which it pays on its liabilities (primarily its deposits).  Net
interest income is a function of (i) the difference between rates of interest
earned on interest-earning assets and rates of interest paid on interest-bearing
liabilities (the "interest rate spread" or "net interest spread") and (ii) the
relative amounts of its interest-earning assets and interest-bearing
liabilities.  When interest-earning assets approximate or exceed interest-
bearing liabilities, any positive interest rate spread will generate net
interest income.  The Bank adheres to an asset and liability management strategy
which is intended to control the impact of interest rate fluctuations upon the
Company's earnings and to make the yields on the Bank's loan portfolio and other
investments more responsive to its cost of funds, in part by more closely
matching the maturities of its interest-earning assets and its interest-bearing
liabilities, while still maximizing net interest income.  Nevertheless, the Bank
is and will continue to be affected by changes in the levels of interest rates
and other factors beyond its control.

     For the fiscal years ended December 31, 2000 and 1999, the Company's
weighted average rate earned on all interest-earning assets was 9.87% and 9.57%,
respectively, and the Company's weighted average rate paid on all interest-
bearing liabilities for the same years was 4.91% and 4.21%, respectively.  The
Company's interest rate spread for the years ended December 31, 2000 and 1999
was 4.96% and 5.36%, respectively, and its net interest income for such years
was $7,568,145 and $6,808,173, respectively.  For the year ended December 31,
2000, the Company's

                                      -4-
<PAGE>

comprehensive income consisted of $1,070,392 in net earnings and a $279,210 gain
in other comprehensive income, which is composed of changes in the unrealized
gain or loss on securities available for sale, net of tax. For the year ended
December 31, 1999, the Company's comprehensive income consisted of $862,538 in
net earnings and a $491,871 loss in other comprehensive income, which is
composed of changes in the unrealized gain on securities available for sale, net
of tax. The Company's net earnings per share (based on the weighted average
number of shares outstanding during the year) increased from $.37 for 1999 to
$.45 for 2000, and its net earnings per share, assuming dilution (which assumes
the effects of potential common shares outstanding during the period), increased
from $.35 for 1999 to $.43 for 2000.


Net Interest Income
-------------------

     The following table shows information concerning interest income from
average interest-earning assets, expressed both in dollars and yields, and
interest expense on average interest-bearing liabilities, expressed both in
dollars and rates, for the periods indicated.  The table includes loan yields
which reflect the amortization of deferred loan origination and commitment fees.
Interest income from investment securities includes the accretion of discounts
and amortization of premiums. All dollar amounts are expressed in thousands.

                                      -5-
<PAGE>

TABLE 1 - Average Consolidated Balance Sheets and Net Interest Analysis
(Dollar amounts in thousands)

<TABLE>
<CAPTION>
                                                                      Years Ended December 31,
                                             ---------------------------------------------------------------------------
                                                           2000                                     1999
                                             ----------------------------------     ------------------------------------
                                                        Interest        Average                  Interest        Average
                                             Average    Income/         Yield/       Average     Income/         Yield/
                                             Balance    Expense/(1)/    Rate         Balance     Expense/(1)/    Rate
                                             -------    -------         ----         -------     -------         ----
<S>                                          <C>        <C>             <C>         <C>          <C>             <C>
ASSETS
Interest-earning assets:
 Loans/(1)(2)/............................   $100,669    $11,177        11.07%      $ 83,226     $ 9,008         10.82%
 Investment securities
    Taxable...............................     20,878      1,401         6.73%        15,166         953          6.28%
    Tax-exempt/(3)/.......................      7,854        367         4.67%         7,759         359          4.63%
 Federal funds sold.......................      3,863        250         6.44%         3,721         191          5.14%
                                             --------    -------        -----       --------     -------         -----
Total interest-earning assets.............   $133,264    $13,195         9.87%      $109,872     $10,511          9.57%

Cash and other assets.....................     11,571                                  7,962
                                             --------                               --------

    Total assets..........................   $144,835                               $117,834
                                             ========                               ========


LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities:
Deposits
 NOW accounts.............................   $ 12,675    $   152         1.20%      $ 12,968     $   173          1.33%
 Money market accounts....................      8,136        296         3.63%         7,839         218          2.78%
 Savings deposits.........................     12,997        349         2.68%        13,265         347          2.62%
 Time deposits, $100,000 and over.........     22,295      1,402         6.27%        18,186       1,036          5.69%
 Time deposits, other.....................     41,391      2,504         6.03%        27,811       1,514          5.45%
                                             --------    -------        -----       --------     -------         -----
  Total interest-bearing deposits.........   $ 97,494    $ 4,703         4.81%      $ 80,069     $ 3,288          4.11%

Federal funds purchased...................        329         27         8.20%           147           8          5.04%
Federal Home Loan Bank advances...........      9,806        579         5.89%         5,500         308          5.60%
Other borrowings..........................      6,613        318         4.79%         2,291          99          4.32%
                                             --------    -------        -----       --------     -------         -----
 Total interest-bearing liabilities.......   $114,242    $ 5,627         4.91%      $ 88,007     $ 3,703          4.21%

Other liabilities:
 Demand deposits..........................   $ 15,168                               $ 14,842
 Accrued interest payable and
  other liabilities.......................        175                                    665
                                             --------                               --------
    Total other liabilities...............     15,343                                 15,507

     Total liabilities....................   $129,585                               $103,414

Stockholders' equity......................     15,250                                 14,321
  Total liabilities
  and stockholders' equity................   $144,835                               $117,834
                                             ========                               ========

Net interest income.......................               $ 7,568                                 $ 6,808
                                                         =======                                 =======

Net interest spread (difference between
rate earned on interest-earning assets
and rate paid on interest-bearing
liabilities)..............................                               4.96%                                    5.36%

Net interest margin (Net interest
income divided by average
interest-earning assets)..................                               5.66%                                    6.20%

<CAPTION>
                                                           1998
                                             ---------------------------------
                                                         Interest      Average
                                             Average     Income/       Yield/
                                             Balance     Expense/(1)/  Rate
                                             -------     -------       ---
<S>                                          <C>           <C>      <C>
ASSETS
Interest-earning assets:
 Loans/(1)(2)/............................   $64,255    $7,267         11.31%
 Investment securities
    Taxable...............................    16,254       976          6.00%
    Tax-exempt/(3)/.......................     6,736       311          4.62%
 Federal funds sold.......................     4,492       243          5.42%
                                             -------    ------         -----
Total interest-earning assets.............   $91,737    $8,797          9.59%

Cash and other assets.....................     6,728
                                             -------

    Total assets..........................   $98,465
                                             =======


LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities:
Deposits
 NOW accounts.............................   $10,979    $  183          1.67%
 Money market accounts....................     8,128       225          2.77%
 Savings deposits.........................    12,909       372          2.88%
 Time deposits, $100,000 and over.........    15,381       933          6.06%
 Time deposits, other.....................    22,804     1,312          5.75%
                                             -------    ------         -----
  Total interest-bearing deposits.........   $70,201    $3,025          4.31%

Federal funds purchased...................        58         3          4.84%
Federal Home Loan Bank advances...........     3,503       195          5.58%
Other borrowings..........................       808        66          8.13%
                                             -------    ------         -----
 Total interest-bearing liabilities.......   $74,570    $3,289          4.41%

Other liabilities:
 Demand deposits..........................   $11,919
 Accrued interest payable and
  other liabilities.......................     1,900
                                             -------
    Total other liabilities...............    13,819

     Total liabilities....................   $88,389

Stockholders' equity......................    10,076
  Total liabilities
  and stockholders' equity................   $98,465
                                             =======

Net interest income.......................              $5,508
                                                        ======

Net interest spread (difference between
rate earned on interest-earning assets
and rate paid on interest-bearing
liabilities)..............................                              5.18%

Net interest margin (Net interest
income divided by average
interest-earning assets)..................                              6.00%
</TABLE>

_________________

/(1)/  Interest income on loans includes amortization of deferred loan fees and
other discounts of $1,367,314, $1,200,474, and $920,413 for the fiscal years
ended December 31, 2000, 1999, and 1998, respectively.
/(2)/  Nonperforming loans are included in the computation of average loan
balances, and interest income on such loans is recognized on a cash basis.
/(3)/  The average yield computed on tax-exempt securities is computed using
actual yields rather than tax-equivalent yields.

                                      -6-
<PAGE>

     Changes in interest income and interest expense are attributable to three
factors: (i) a change in volume or amount of an asset or liability; (ii) a
change in interest rates; or (iii) a change caused by the combination of changes
in volume and interest rates.  The following table describes the extent to which
changes in interest rates and changes in volume of interest-earning assets and
interest-bearing liabilities have affected the Company's interest income and
expense during the periods indicated.  For each category of interest-earning
assets and interest-bearing liabilities, information is provided as to changes
attributable to change in volume (change in volume multiplied by old rate) and
change in rates (change in rate multiplied by old volume).  The net change
attributable to changes in both volume and rate has been allocated
proportionately to the change due to volume and the change due to rate.  All
dollar amounts are expressed in thousands.

TABLE 2 - Changes in Interest Income and Expense
(Dollar amounts in thousands)

<TABLE>
<CAPTION>
                                            Year Ended December 31,           Year Ended December 31,
                                            2000 Compared to 1999             1999 Compared to 1998
                                            -----------------------           -----------------------
                                                     Rate/        Net                  Rate/        Net
                                          Volume     Yield     Change       Volume     Yield     Change
                                          ------     -----     ------       ------     -----     ------
<S>                                       <C>        <C>       <C>          <C>        <C>       <C>
Interest income:
Loans /(1)(2)/........................    $1,931      $238     $2,169       $2,065      (323)     1,742
Investment securities /(3)/...........       352       104        456           (4)       28         24
Federal funds sold....................         7        52         59          (40)      (12)       (52)
                                          ------      ----     ------       ------      ----      -----
 Total interest income................     2,290       394      2,684        2,021      (307)     1,714

Interest expense:
NOW accounts..........................        (4)      (17)       (21)          30       (40)       (10)
Money market accounts.................         9        69         78           (8)        1         (7)
Savings deposits......................        (7)        9          2           10       (35)       (25)
Time deposits, $100,000 and over......       251       115        366          162       (59)       103
Time deposits, other..................       806       184        990          275       (73)       202
                                          ------      ----     ------       ------      ----      -----
Total deposits........................     1,055       360      1,415          469      (206)       263

Other borrowings......................       474        35        509          187       (36)       151
                                          ------      ----     ------       ------      ----      -----

Total interest expense................     1,529       395      1,924          656      (242)       414
                                          ------      ----     ------       ------      ----      -----

Net interest income...................       761        (1)       760        1,365       (65)     1,300
                                          ======      ====     ======       ======      ====      =====
</TABLE>

______________
/(1)/ Loan amounts include nonaccruing loans.
/(2)/ Interest income includes the portion of loan fees recognized in the
respective periods.
/(3)/ Changes due to rate and volume on investment securities have been computed
using actual yields on tax-exempt securities rather than tax-equivalent yields.
Yields are computed on the carrying value of the securities.


     The level and volatility of interest rates can have a significant impact on
the Company's profitability.  Management attempts through interest rate risk
management to identify and manage the sensitivity of the Company's net interest
income to changing interest rates.  The Company uses income simulation modeling
as a tool in measuring interest rate risk and managing interest rate sensitivity
of its assets and liabilities.  Simulation modeling considers the impact of
changing market rates of interest on future net interest income.

                                      -7-
<PAGE>

     Interest rate sensitivity management focuses on the maturity structure of
assets and liabilities and their repricing characteristics during periods of
changes in market interest rates.  Effective interest rate sensitivity
management seeks to ensure that both assets and liabilities respond to changes
in interest rates within an acceptable time frame, thereby minimizing the impact
of interest rate changes on net interest income.  The following table sets forth
the repricing of the Company's interest-earning assets and interest-bearing
liabilities as of December 31, 2000.  The time periods in the table represent
the period, following December 31, 2000, during which an asset or liability
matures or can be repriced.  This interest sensitivity gap table is designed to
monitor the Company's interest rate risk exposure within the designated time
horizons.  In order to control interest rate risk, management regularly monitors
the volume of interest sensitive assets relative to interest sensitive
liabilities over specific time intervals.  The Company's interest rate
management policy is to attempt to maintain a relatively stable net interest
margin in periods of interest rate fluctuations.  The Company's policy is to
attempt to maintain a ratio of cumulative gap to total assets of 0% to negative
25% in the time periods of one year and five years.  The following table
reflects that the Company's interest-earning assets and interest-bearing
liabilities are slightly outside the Company's policy guidelines in the time
period of five years.  Management monitors rate sensitivity on a monthly basis,
and considers the Company's interest sensitivity gap measurement to be at an
acceptable level.


TABLE 3 - Interest Rate Gap Sensitivity
(Dollar amounts in thousands)

<TABLE>
<CAPTION>
                                            0 to 3      4 to 6     7 to 12     1 to 5    Over 5
                                            Months      Months      Months      Years     Years      Total
                                            ------      ------      ------      -----     -----      -----
<S>                                        <C>        <C>         <C>         <C>       <C>       <C>
Interest Sensitive Assets
-------------------------
Federal Funds Sold.......................  $ 2,010         -0-         -0-        -0-       -0-   $  2,010
Investment Securities
   Taxable /(1)/.........................    1,202          79       3,289     12,858     5,055     22,483
   Tax-exempt /(1)/......................      -0-         -0-         160      2,739     5,749      8,648
Loans
   Fixed rate............................    7,611       3,240       2,143      3,631       -0-     16,625
   Adjustable rate.......................   44,774         642       1,500      2,033       -0-     48,949
   Scheduled payments....................    4,859       3,148       5,918     28,358     1,465     43,748
                                           -------    --------    --------    -------   -------   --------
Total Interest-Sensitive Assets..........  $60,456    $  7,109    $ 13,010    $49,619   $12,269   $142,463
                                           =======    ========    ========    =======   =======   ========

Interest Sensitive Liabilities
------------------------------
NOW......................................  $11,553         -0-         -0-        -0-       -0-   $ 11,553
Money Market.............................    8,085         -0-         -0-        -0-       -0-      8,085
Savings..................................   15,182         -0-         -0-        -0-       -0-     15,182
Time Deposits............................   14,072      10,052      12,051      9,771       -0-     45,946
Time, in excess of $100,000..............    9,324       4,501       7,067      4,191       -0-     25,083
Other interest-bearing liabilities.......    8,048         -0-         -0-     10,500       -0-     18,548
                                           -------    --------    --------    -------   -------   --------
Total Interest Sensitive Liabilities.....  $66,264    $ 14,553    $ 19,118    $24,462   $   -0-   $124,397
                                           =======    ========    ========    =======   =======   ========

Interest Sensitivity Gap.................   (5,808)     (7,444)     (6,108)    25,157    12,269     18,066
Cumulative Gap...........................   (5,808)    (13,252)    (19,360)     5,797    18,066

Ratio of cumulative gap to
   total assets..........................    (3.71%)     (8.47%)    (12.37%)     3.70%    11.54%
</TABLE>

_________________
/(1)/ All investment securities are shown at the carrying value.

                                      -8-
<PAGE>

     Changes in the mix of earning assets or supporting liabilities can either
increase or decrease the net interest margin without affecting interest rate gap
sensitivity. Additionally, the interest rate spread between an asset and its
supporting liability can vary significantly while the timing of repricing for
both the asset and the liability remains the same, and this characteristic is
known as basis risk. Also, varying interest rate environments may create
unexpected changes in prepayment levels of assets and liabilities that are not
reflected in the interest rate sensitivity analysis. Due to reasons such as
these, management considers the gap analysis in Table 3 to be one tool in
studying interest rate sensitivity, just as simulation modeling is another tool.
Current simulation results indicate minimal sensitivity to parallel shifts in
the yield curve; however, no assurances can be given that the Company is not at
risk from changes in interest rates.


Lending Activities
------------------

General

     At December 31, 2000, the Company's net loan portfolio constituted
approximately 68.76% of the Company's total assets.  The following table sets
forth the composition of the Company's loan portfolio at the indicated dates.


TABLE 4 - Loans Outstanding
(Dollar amounts in thousands)

<TABLE>
<CAPTION>
                                                   At December 31,
                                         -----------------------------------
                                               2000              1999
                                         ----------------   ----------------
                                         Amount   Percent   Amount   Percent
                                         ------   -------   ------   -------

<S>                                     <C>       <C>      <C>       <C>
Commercial, financial,
and agricultural......................  $ 16,807   15.37%  $11,167    12.46%

Real estate - construction............    22,726   20.79%   16,576    18.50%

Real estate - mortgage................    58,245   53.28%   49,359    55.08%

Consumer loans........................    11,544   10.56%   12,512    13.96%
                                        --------  ------   -------   ------

Total loans...........................   109,322  100.00%   89,614   100.00%

Less: Allowance for loan losses.......     1,678             1,357
                                        --------           -------

Total loans, net......................  $107,644           $88,257
                                        ========           =======
</TABLE>

     The following table sets forth the scheduled maturities of the loans for
selected categories in the Company's loan portfolio as of December 31, 2000
based on their contractual terms to maturity.  Loans unpaid at maturity are
renegotiated based on current market rates and terms.

                                      -9-
<PAGE>

TABLE 5 - Loan Portfolio Maturity
(Dollar amounts in thousands)

<TABLE>
<CAPTION>
                                                                                     Rate Structure for Loans
                                                   Loans Maturing                    Maturing Over One Year
                                     -----------------------------------------       ----------------------
                                         Less    One to        More                                  Floating or
                                     than One      Five   than Five                Predetermined      Adjustable
                                         Year     Years       Years      Total     Interest Rate            Rate
                                         ----     -----       -----      -----     -------------            ----
<S>                                  <C>         <C>      <C>          <C>         <C>               <C>
Commercial, financial
   and agricultural................   $ 9,597    $5,815      $1,395    $16,807            $7,193          $1,149

Real estate -
   construction....................    18,727     3,874         125     22,726             3,113             886
                                      -------    ------      ------    -------           -------          ------

   Total...........................   $28,324    $9,689      $1,520    $39,533           $10,306          $2,035
                                      =======    ======      ======    =======           =======          ======
</TABLE>


Types of Loans

Commercial, Financial, and Agricultural Loans

     Commercial, financial, and agricultural loans, hereinafter referred to as
commercial loans (including non-real estate loans for agricultural purposes but
excluding commercial construction loans), totaled $16,806,673 or 15.37% of the
Company's gross loan portfolio at December 31, 2000. All commercial loans are
held in the Bank's loan portfolio. These loans consist of loans and lines of
credit to individuals, partnerships and corporations for a variety of business
purposes, such as accounts receivable and inventory financing, equipment
financing, business expansion and working capital. The terms of the Bank's
commercial loans generally range from three months to seven years, and some of
the loans carry interest rates which adjust in accordance with changes in the
prime rate. Substantially all of the Bank's commercial loans are secured and
guaranteed by the principals of the business.

Real Estate - Construction Loans

     $22,726,261 or 20.79% of the Company's gross loans outstanding at December
31, 2000 were construction loans and acquisition and development loans.  All
construction and acquisition and development loans are held in the Bank's loan
portfolio.  The Bank makes residential construction loans to owner-occupants and
to persons building residential properties for resale.  The majority of the
Bank's construction loans are made to residential real estate developers for
single-family residential properties.  Construction loans are usually variable
rate loans made for terms of six months, but extensions are permitted if
construction has continued satisfactorily and if the loan is current and other
circumstances warrant the extension.  Construction loans

                                      -10-
<PAGE>

are limited to 85% of the appraised value of the lot and the completed value of
the proposed structure. In response to competitive conditions, the Bank permits
a portion of its single family residential construction loans extended to
builders to be made without commitments for "take-out" or permanent financing
from third parties.

     Construction financing generally is considered to involve a higher degree
of credit risk than permanent mortgage financing of residential properties, and
this additional risk usually is reflected in higher interest rates.  The higher
risk of loss on construction loans is attributable in large part to the fact
that loan funds are estimated and advanced upon the security of the project
under construction, which is of uncertain value prior to the completion of
construction.  Moreover, because of the uncertainties inherent in estimating
construction costs, delays arising from labor problems, material shortages and
other unpredictable contingencies, it is relatively difficult to accurately
evaluate the total loan funds required to complete a project and to accurately
evaluate the related loan-to-value ratios.  If the estimates of construction
costs and the salability of the property upon completion of the project prove to
be inaccurate, the Bank may be required to advance funds beyond the amount
originally committed to permit completion of the project.  If the estimate of
value proves to be inaccurate, the Bank may be confronted, at or prior to the
maturity of the loan, with a project with a value which is insufficient to
assure full repayment.

     The Bank's underwriting criteria are designed to evaluate and minimize the
risk of each construction loan.  Among other items, the Bank considers evidence
of the availability of permanent financing or a take-out commitment to the
borrower, the financial strength and reputation of the borrower, an independent
appraisal and review of cost estimates, market conditions, and, if applicable,
the amount of the borrower's equity in the project, pre-construction sale or
leasing information and cash flow projections of the borrower.

Real Estate - Mortgage Loans

     At December 31, 2000, real estate - mortgage loans totaled $58,245,232 or
53.28% of the Company's gross loan portfolio.  Real estate - mortgage loans
include all loans secured by real estate for purposes other than construction or
acquisition and development and are hereinafter referred to as real estate
loans.  All real estate loans are held in the Bank's loan portfolio.  Of this
amount, $13,793,426 or 12.62% of the Company's gross loan portfolio was
comprised of loans secured by one to four family residential properties,
including home equity loans (loans secured by the equity in the borrower's
residence but not necessarily for the purpose of home improvement).  Most of
these home equity loans are made at fixed interest rates for terms of one to
three years with balloon payment provisions and amortized over a 10-15 year
period. The Bank also offers a product which allows consumers to borrow with low
closing costs on the equity in their homes.  This product is a variable rate
revolving line of credit, having an outside maturity of 5 years with 1.5% of the
average daily balance due monthly.  The Bank's experience indicates that real
estate loans normally remain outstanding for much shorter periods (seven years
on average) than their stated maturity because the borrowers repay the loans in
full either upon the sale of the secured property or upon the refinancing of the
original loan.

     The real estate loans originated by the Bank contain a "due-on-sale"
clause, which provides that the Bank may declare the unpaid balance of the loan
immediately due and payable upon the sale

                                      -11-
<PAGE>

of the mortgaged property. Such clauses are an important means of reducing the
average loan life and increasing the yield on existing fixed-rate real estate
loans, and it is the Bank's policy to enforce due-on-sale clauses.

     At December 31, 2000, the remainder of the Company's real estate loans
totaled $44,451,806 or 40.66% of the Company's gross loan portfolio.  These
loans were comprised of non-farm nonresidential real estate loans (including
commercial real estate loans and loans secured by raw land).

Consumer Loans

     At December 31, 2000, consumer loans totaled $11,543,621 or 10.56% of the
Company's gross loan portfolio.  $7,282,783 or 63.09% of these loans are held in
the Bank's loan portfolio, with the remainder held in CLC's loan portfolio.

     The Bank makes both secured and unsecured consumer loans for a variety of
personal and household purposes.  Most of the Bank's consumer loans are
automobile loans, boat loans, property improvement loans and loans to depositors
on the security of their certificates of deposit.  These loans are generally
made for terms of up to five years at fixed interest rates.  The Bank considers
consumer loans to involve a relatively high credit risk compared to real estate
loans.  Consumer loans, therefore, generally yield a relatively high return to
the Bank and provide a relatively short maturity.  The Bank believes that the
generally higher yields and the shorter terms available on various types of
consumer loans tend to offset the relatively higher risk associated with such
loans, and contribute to a profitable spread between the Bank's average yield on
earning assets and the Bank's cost of funds.

     At December 31, 2000, consumer loans held in CLC's loan portfolio totaled
$4,260,838 or 3.90% of the Company's gross loan portfolio.  CLC, a consumer
finance company, makes loans for up to $3,000 with original maturities of up to
three years under the Georgia Industrial Loan Act (GILA).  Additionally, CLC may
choose to make consumer loans, which are typically called deregulated loans,
such as sales finance loans.  The Company considers CLC's loans to involve a
relatively high credit risk compared to other loans in the Company's portfolio.
These consumer loans generally yield a higher return to the Company than
consumer loans originated by the Bank.  The Company believes that the generally
higher yields on CLC's loan portfolio offset the higher risk associated with
such loans and contribute to a profitable spread between the Company's yield on
earning assets and the Company's cost of funds.

     As of March 1, 2000, the Bank sold its credit card portfolio to the Bankers
Bank in Atlanta, Georgia.  For one year from the time of this sale, the Bank
will be responsible to Bankers Bank for any debt in this portfolio which proves
to be uncollectable after 90 days.

                                      -12-
<PAGE>

Origination, Purchase and Sale of Loans

     The Bank originates loans primarily in Paulding County, Georgia.  The Bank
also originates loans in Cobb, Douglas, and Bartow Counties, each of which is
contiguous to Paulding.  Loans are originated by loan officers who operate from
the Bank's offices in Paulding and Cobb Counties.  These loan officers actively
solicit loan applications from existing customers, local manufacturers and
retailers, builders, real estate developers, real estate agents and others.  The
Bank also receives numerous loan applications as a result of customer referrals
and walk-ins to its offices.

     Upon receipt of a loan application and all required supporting information
from a prospective borrower, the Bank obtains a credit report and verifies
specific information relating to the loan applicant's employment, income and
creditworthiness.  For significant extensions of credit, a certified appraisal
of the real estate intended to secure the proposed loan is undertaken by an
independent appraiser approved by the Bank.  The Bank's loan officers then
analyze the credit worthiness of the borrower and the value of any collateral
involved.

     The Bank's loan approval process is intended to be conservative but also
responsive to customer needs.  Loans are approved in accordance with the Bank's
written loan policy, which provides for several tiers of approval authority,
based on a borrower's aggregate debt with the Bank. There is a Loan Committee
comprised of the senior officers of the Bank which must approve any loan that
increases the borrower's aggregate indebtedness above an individual officer's
limit, but that is not more than $250,000.  The Loan Committee of the Board of
Directors, comprised of the Chief Executive Officer and five non-employee
Directors, must approve all loans over $250,000, and all lending relationships
where a borrower's aggregate indebtedness to the Bank exceeds $250,000.

     From time to time, the Bank may participate in loans with other financial
institutions by either buying or selling part of a loan.  The purchase of a loan
participation allows the Bank to expand its loan portfolio and increase
profitability while still maintaining the high credit standards which are
applied to all extensions of credit made by the Bank.  The sale of loan
participations allows the Bank to make larger loans which it otherwise would be
unable to make due to capital or other funding considerations.

     CLC's loans are originated by lenders who operate from CLC's offices in
northwest Georgia.  These lenders actively solicit loan applications from
existing customers.  CLC also originates loans through a conditional sales
contract program with retailers.  CLC may expand the program with similar
arrangements through other retailers.  All loans made through this program must
meet CLC's ordinary credit standards.  CLC receives numerous loan applications
as a result of customer referrals and walk-ins to its offices.


Loan Fee Income

     In addition to interest earned on loans, the Bank receives origination fees
for making loans, commitment fees for making certain loans, and other fees for
miscellaneous loan-related services.

                                      -13-
<PAGE>

Such fee income varies with the volume of loans made, prepaid or sold, and the
rates of fees vary from time to time depending on the supply of funds and
competitive conditions.

     Commitment fees are charged by the Bank to the borrower for certain loans
and are calculated as a percentage of the principal amount of the loan.  These
fees normally are deducted from the proceeds of the loan and generally range
from  1/2% to 1% of the principal amount, depending on the type and volume of
loans made and market conditions such as the demand for loans, the availability
of money and general economic conditions.

     The Bank also receives miscellaneous fee income from late payment charges,
overdraft fees, property inspection fees, and miscellaneous services related to
its existing loans.  For the year ended December 31, 2000, the Bank recognized
origination, commitment and other loan fees totaling $795,334, which equaled
10.51% of the Company's net interest income for such year.  For the years ended
December 31, 1999 and 1998, the Bank recognized origination, commitment and
other loan fees totaling $752,107 and $628,683, respectively, which equaled
11.05% and 11.41%, respectively, of the Company's net interest income for such
years.

     CLC receives miscellaneous fee income from late payment charges, loan fees,
maintenance fees, and miscellaneous services related to its existing loans.  For
the year ended December 31, 2000, CLC recognized loan fees totaling $571,980,
which equaled 7.56% of the Company's net interest income for such year.  For the
years ended December 31, 1999 and 1998, CLC recognized loan fees totaling
$448,367 and $291,730, respectively, which equaled 6.59% and 5.30%,
respectively, of the Company's net interest income for such years.


Problem Loans and Allowance for Loan Losses

Problem Loans

     In originating loans, the Company recognizes that credit losses will be
experienced and that the risk of loss will vary with, among other things, the
type of loan being made, the creditworthiness of the borrower over the term of
the loan and, in the case of a secured loan, the guaranty of the security for
the loan.  The Company has instituted measures at both the Bank and CLC which
are designed to reduce the risk of, and monitor exposure to, credit losses.

     The Bank's loan portfolio is periodically reviewed by the Bank's management
to identify deficiencies and to take corrective actions as necessary.  As
discussed below, each of the Bank's loans is assigned a rating in accordance
with the Bank's internal loan rating system and is reviewed monthly to update
its rating in accordance with the performance of the loan.  All past due loans
are reviewed monthly by the Bank's senior lending officers and by the Loan
Committee of the Board of Directors, and all loans classified as substandard or
doubtful, as well as any "special mention" loans, are reviewed at least monthly
by the Loan Committee.  In addition, all loans to a particular borrower are
reviewed, regardless of classification, each time such borrower requests a
renewal or extension of any loan or requests an additional loan.  All lines of
credit are reviewed annually prior to renewal.  Such reviews include, but are
not limited to, the ability of the borrower to repay the loan, a re-

                                      -14-
<PAGE>

assessment of the borrower's financial condition, the value of any collateral
and the estimated potential loss to the Bank, if any.

     The Bank's internal problem loan rating system establishes three
classifications for problem assets: substandard, doubtful and loss.
Additionally, in connection with regulatory examinations of the Bank, federal
and state examiners have authority to identify problem assets and, if
appropriate, require the Bank to classify them.  Substandard assets have one or
more defined weaknesses and are characterized by the distinct possibility that
the Bank will sustain some loss if the deficiencies are not corrected.  Doubtful
assets have the weaknesses of substandard assets with the additional
characteristic that the weaknesses make collection or liquidation in full, on
the basis of currently existing facts, conditions and values, highly
questionable and improbable.  An asset classified as loss is considered
uncollectible.  Federal regulations also designate a "special mention" category,
described as assets which do not currently expose the Bank to a sufficient
degree of risk to warrant classification but do possess credit deficiencies or
potential weaknesses deserving management's close attention.

     The Bank's collection procedures provide that when a loan becomes 10 days
delinquent, the borrower is contacted by mail and payment is requested.  If the
delinquency continues, subsequent efforts are made to contact and request
payment from the delinquent borrower.  Most loan delinquencies are cured within
60 days and no legal action is required.  In certain circumstances, the Bank,
for a fee, may modify the loan, grant a limited moratorium on loan payments or
revise the payment schedule to enable the borrower to restructure his or her
financial affairs.  The Bank has restructured loans as of December 31, 2000,
which totaled approximately $100,956.  Generally, the Bank stops accruing
interest on delinquent loans when payment is in arrears for 90 days (unless the
obligation is both well secured and in the process of collection) or when
collection otherwise becomes doubtful.  If the delinquency exceeds 120 days and
is not cured through the Bank's normal collection procedures or through a
restructuring, the Bank will institute measures to enforce its remedies
resulting from the default, including commencing a foreclosure, repossession or
collection action.  In certain cases, the Bank will consider accepting a
voluntary conveyance of collateral in lieu of foreclosure or repossession.  Real
property acquired by the Bank as a result of foreclosure or by deed in lieu of
foreclosure is classified as "real estate owned" until it is sold and is carried
at the lower of cost (defined as fair value at foreclosure) or fair value less
estimated costs to dispose.  Accounting standards define fair value as the
amount that is expected to be received in a current sale between a willing buyer
and seller other than in a forced or liquidation sale.  Fair values at
foreclosure are based on appraisals.  Losses arising from the acquisition of
foreclosed properties are charged against the allowance for loan losses.
Subsequent write-downs are provided by a charge to income through losses on
other real estate in the period in which the need arises.

     The Bank attempts to sell real estate owned promptly after foreclosure, and
it sold $184,353 of real estate owned due to loan foreclosures during the year
ended December 31, 2000.  The book value of real estate owned that was sold by
the Bank during the year ended December 31, 2000 totaled  $191,986.  As of
December 31, 2000, there was no real estate owned as a result of foreclosure.

                                      -15-
<PAGE>

     CLC's loan portfolio is periodically reviewed by CLC's management to
identify deficiencies and to take corrective actions as necessary.  All past due
loans are reviewed daily by each CLC Office Manager and monthly by CLC's senior
management.  CLC's Board of Directors reviews the total loans considered over 90
days delinquent in their bi-monthly meetings.  The Board compares delinquency
rates on an office-by-office basis.  CLC's collection procedures provide that
when a loan becomes 5 days delinquent, the borrower is contacted by mail and
payment is requested.  If the delinquency continues, subsequent efforts are made
to contact and request payment from the delinquent borrower.  Most loan
delinquencies are cured within 90 days and no legal action is required.
Generally, when an account reaches 90 to 120 days with no payment collected in
that time frame, notice will be mailed to the customer stating that CLC is
taking legal action against them unless the account is brought to a current
status within 10 days.  If the customer does not respond within that time frame,
CLC typically will file suit against the parties involved in the local
Magistrate Court.  Generally, CLC's policy is to charge off any loan on which
CLC has not received a payment in 6 months.  Management may determine that a
loan is in the process of collection and, therefore, the past due loan does not
have to be charged off.  CLC's loans which are past due 90 days or more and
still accruing total $465,842 as of December 31, 2000, as compared to $440,064
as of December 31, 1999.

     The following table sets forth information regarding the Company's
delinquent and non-performing assets as of the dates indicated.


<TABLE>
<CAPTION>
TABLE 6 - Non-performing Assets
(Dollar amounts in thousands)                           At December 31,
                                                        ---------------

                                                     2000             1999
                                                     ----             ----
<S>                                                 <C>              <C>
Non-performing assets:

Accruing loans which are contractually
  past due 90 days or more........................  $  641           $  440

Nonaccruing loans.................................     505              525

Real estate acquired through foreclosure..........     -0-              192

Property acquired through repossession............      15              -0-
                                                    ------           ------

      Total.......................................  $1,161           $1,157
                                                    ======           ======

Ratio of non-performing assets to:

Total loans and real estate acquired
   through foreclosure and repossessions..........    1.06%            1.29%

Total assets......................................    0.74%            0.88%
</TABLE>

                                      -16-
<PAGE>

     The Bank recorded interest income on the nonaccruing loans listed above for
the fiscal year ended December 31, 2000 of $52,413.  The gross interest income
that would have been recorded during the fiscal year ended December 31, 2000 if
the nonaccruing loans listed above had been current in accordance with their
original terms would have been $88,993.

Allowance for Loan Losses

     The allowance for loan losses is a means of absorbing future losses which
could be incurred from the current loan portfolio.  Both the Bank and CLC
maintain an allowance for loan losses, and management adjusts the general
allowances monthly by charges to income in response to changes to outstanding
loan balances, net charge-offs, delinquencies, and management's assessment of
the quality of the loan portfolio and general economic conditions.

     The Bank maintains a general allowance in the range of 1.00% to 1.50% of
the total principal amount of loans outstanding (less the total principal amount
of loans outstanding that are secured by certificates of deposit), and
management adjusts the general allowance monthly by charges to income in
response to changes in the outstanding loan balance and changes in the asset
quality ratings.  Management also may establish specific loan loss allowances
for specific loans after considering such factors as past delinquencies on the
loan, the value of the underlying collateral and the size of the loan.  The Bank
began a special allowance in 1996 equal to 4% of the outstanding balances in its
credit card portfolio, in acknowledgment of the risk related with this type of
credit product.  This portfolio was sold in February 2000, therefore the special
allowance for the Bank's credit card portfolio will not be necessary after one
year from the date of the sale.  A loan or portion thereof is charged off
against the general allowance when management has determined that losses on such
loans are probable.  Recoveries on any loans charged off in prior fiscal periods
are credited to the allowance.  It is the opinion of the Bank's management that
the balance in the general allowance for loan losses as of December 31, 2000 is
adequate to absorb possible losses from loans currently in the portfolio.

     CLC maintains a general allowance for possible loan losses, in addition to
the fact that a majority of the loans in CLC's portfolio are insured in case of
default by the borrower.  CLC may be reimbursed for any covered loan balance
which goes into default.  CLC's Board of Directors reviews the general allowance
for loan loss on a quarterly basis to review its adequacy in covering any future
losses that may be sustained by CLC.

     The following table summarizes the Company's loan loss experience for the
periods indicated.

                                      -17-
<PAGE>

TABLE 7 - Analysis of the Allowance for Loan Losses
(Dollar amounts in thousands)

<TABLE>
<CAPTION>
                                                       Years Ended December 31,
                                                       ------------------------

                                                       2000               1999
                                                       ----               ----
<S>                                                   <C>                <C>
Allowance for possible loan losses,
  beginning of the period..........................   $1,357             $  935

Charge-offs for the period:
  Commercial, financial, and agricultural..........       32                  9
  Real estate - construction.......................        0                  0
  Real estate - mortgage...........................        0                 20
  Consumer.........................................      290                384
                                                      ------             ------

   Total charge-offs...............................      322                413
                                                      ------             ------

Recoveries for the period:
  Commercial, financial, and agricultural..........   $    0             $   13
  Real estate - construction.......................        0                  0
  Real estate - mortgage...........................        0                  0
  Consumer.........................................       67                 50
                                                      ------             ------

   Total recoveries................................       67                 63
                                                      ------             ------

Net charge-offs for the period.....................      255                350
                                                      ------             ------

Allowance for loan losses acquired (sold)..........      (15)                77
                                                      ------             ------

Provision for loan losses charged to earnings......      591                695
                                                      ------             ------

Allowance for possible loan losses,
  end of the period................................   $1,678             $1,357
                                                      ======             ======

Ratio of allowance for loan losses to
  total average loans outstanding..................     1.67%              1.64%

Ratio of net charge-offs during
  the period to average loans
  outstanding during the period....................     0.25%              0.42%
</TABLE>

     In addition to the Bank's loan rating system for problem assets described
above (see Problem Loans, above), the Bank has established a loan rating system
for all categories of loans which assists management and the Board of Directors
in determining the adequacy of the Bank's allowance for loan losses.  Each loan
in the Bank's portfolio is assigned a rating which is reviewed by management
periodically to ensure its continued suitability.  An exception is made in the
case of (i) monthly installment loans which are grouped together by delinquency
status such as over 10, 30, 60, or 90

                                      -18-
<PAGE>

days past due and (ii) problem assets which are rated as substandard, doubtful,
or loss as discussed above. All other loans are assigned a rating that consists
of five categories ranging from excellent to "special mention". Loans rated in
each of these five loan rating categories are weighted by factors ranging from
of 0.50% to 5.00% that management believes reasonably reflects losses that can
be anticipated with respect to loans in each of these categories. Loans in the
substandard, doubtful, or loss categories are weighted by factors of 15%, 50%
and 100%, respectively. Based on these weightings, the Bank's management
establishes an allowance for loan losses that is reviewed by its Board of
Directors each month. Additionally, management takes into consideration other
factors such as the amount of loans committed but unfunded, changes in the
economy, and other issues, in order to establish an allowance for loan losses.

     The following table sets forth the Company's allocation of the allowance
for loan losses as of December 31, 2000, and 1999.



TABLE 8 - Allocation of the Allowance for Loan Losses
(Dollar amounts in thousands)

<TABLE>
<CAPTION>
                                                   At December 31, 2000           At December 31, 1999
                                                --------------------------    ----------------------------

                                                          Percent of loans                Percent of loans
                                                          in each category                in each category
Balance at end of period applicable to          Amount    to total loans      Amount      to total loans
--------------------------------------          ------    --------------      ------      --------------
<S>                                             <C>       <C>                 <C>         <C>
Commercial, financial, and agricultural.......  $   94         15.37%         $   73           12.46%
Real estate - construction....................     113         20.79%             84           18.50%
Real estate - mortgage........................     591         53.28%            603           55.08%
Consumer......................................     445         10.56%            350           13.96%
Unallocated...................................     435           N/A             247             N/A
                                                ------        ------          ------          ------

     Total....................................  $1,678        100.00%         $1,357          100.00%
                                                ======        ======          ======          ======
</TABLE>

Investment Activities
---------------------

     Interest earned on securities and other investments provides the second
largest source of revenues for the Company after interest on loans, constituting
$1,768,031 or 11.39% of total interest and other income for the year ended
December 31, 2000, as compared to $1,311,294, or 10.60%, respectively, as of
December 31, 1999.  The Company's investment portfolio totaled $31,132,153 or
19.89% of total assets at December 31, 2000, as compared to $27,226,422, or
20.66%, respectively, as of December 31, 1999.  The entire investment portfolio
is held by the Bank.  The portfolio is designed to enhance liquidity while
providing acceptable rates of return.

                                      -19-
<PAGE>

     The following table sets forth the carrying value of the Bank's investments
at the dates indicated.  All securities held are available for sale and are
carried at fair market value.  However, other investments include Federal Home
Loan Bank stock and other equity securities with no readily determinable fair
value.  These investment securities are carried at cost.


TABLE 9 - Investment Securities
(Dollar amounts in thousands)                             At  December 31,
                                                          ----------------

                                                          2000           1999
                                                          ----           ----
       U.S. Government and agency
         obligations.................................  $19,613        $18,486
       Other bonds, notes, debentures
         and securities..............................    2,871          1,115
       States & political subdivisions - tax-exempt..    8,648          7,625
                                                       -------        -------
          Total......................................  $31,132        $27,226
                                                       =======        =======


     The following table sets forth the carrying value of the Bank's investments
at December 31, 2000, the weighted average yields on the Bank's investments at
December 31, 2000 and the periods to maturity of the Bank's investments from
December 31, 2000.


TABLE 10 - Expected Maturities of Investment Securities
(Dollar amounts in thousands)

<TABLE>
<CAPTION>
                                            Periods to Maturity from December 31, 2000
                                            ------------------------------------------

                               1 year or less     1 - 5 years     5 - 10 years     Over 10 years
                               --------------     -----------     ------------     -------------
                                       Amount          Amount           Amount            Amount
                                       ------          ------           ------            ------
<S>                            <C>                <C>             <C>              <C>
U. S. Government and
   agency Obligations........          $2,995         $ 7,322           $5,150            $  112
U. S. Government agencies -
   mortgage-backed...........             170             -0-              489             3,375
Tax-exempt
   municipal bonds...........             160           2,738            3,725             2,025
Other bonds, notes, de-
   bentures, and securities..           1,884             987              -0-               -0-
                                       ------         -------           ------            ------

   Total.....................          $5,209         $11,047           $9,364            $5,512
                                       ======         =======           ======            ======

Weighted average yield.......            6.03%           6.63%            7.15%             7.45%
</TABLE>

(1) The weighted average yields on tax-exempt securities have been computed on
a tax-equivalent basis.

                                      -20-
<PAGE>

Sources of Funds
----------------

General

     Time, money market, savings and demand deposits are the major source of the
Company's funds for lending and other investment purposes.  All deposits are
held by the Bank.  In addition, the Company obtains funds from loan principal
repayments, proceeds from sales of loan participations and investment
securities, and other borrowings.  Loan repayments are a relatively stable
source of funds, while deposit inflows and outflows and sales of loan
participations and investment securities are significantly influenced by
prevailing interest rates, economic conditions and the Company's asset and
liability management strategies.  Borrowings may be used on a short-term basis
to compensate for reductions in the availability of other sources of funds or on
a longer term basis to support expanded lending activities and for other general
business purposes.

Deposits

The Bank offers several types of deposit accounts, with the principal
differences relating to the minimum balances required, the time period the funds
must remain on deposit and the interest rate.  Deposits are obtained primarily
from the Bank's Paulding and Cobb Counties market area.  The Bank has an
Internet branch via its website, where new customers may open a deposit account
with little concern about geographic location.  The Bank has partnered with a
vendor which provides customers with a bill paying service and the ability to
conduct funds transfers via a secure Internet connection.  The Bank has
implemented stringent security measures in order to provide the ease of Internet
banking while maintaining safety measures deemed necessary by management.  The
Bank also subscribes to a service called QwickRate, which allows the Bank to
publish its rates on certificates of deposits over an electronic billboard that
may attract interested depositors throughout the U.S.  The Bank may choose to
seek deposits through this alternative source of funds if management determines
that the choice meets the Company's asset and liability strategies.  Management
of the Bank sets the rates to be offered, which have been slightly higher than
the rates paid on core deposits.  The Bank had $5,105,045 outstanding in these
time deposits for the year ended December 31, 2000.  Additionally, a product
offered by the Bank allows certain commercial customers the flexibility of
employing funds that might otherwise remain in deposit balances to invest in
repurchase agreements so that the customer may earn interest overnight.
Securities sold under repurchase agreements totaled $6,302,165 at December 31,
2000.

     A principal source of deposits for the Bank consists of short-term money
market and other accounts which are highly responsive to changes in market
interest rates.  Accordingly, the Bank, like all financial institutions, is
subject to short-term fluctuations in deposits in response to customer actions
due to changing short-term market interest rates.  The ability of the Bank to
attract and maintain deposits and the Bank's cost of funds have been and will
continue to be significantly affected by money market conditions.

                                      -21-
<PAGE>

     The following table sets forth the maturity distribution of time deposits
of $100,000 or more at December 31, 2000.


TABLE 11 - Maturities of Time Deposits of $100,000 and greater
(Dollar amounts in thousands)


                                   Time Deposits
                                   $100,000 or more
                                   ----------------

3 months or less.................     $ 9,325
Over 3 months through 6 months...       4,501
Over 6 months through 12 months..       7,066
Over 12 months...................       4,191
                                      -------
 Total outstanding...............     $25,083
                                      =======


Borrowings

     The Bank maintains two lines of credit to borrow federal funds that total
$5,300,000 in order to enhance liquidity.  At December 31, 2000, the Bank had no
funds borrowed on either of these lines of credit.  The Bank is a member of the
Federal Home Loan Bank and borrowings are also available through that
relationship.  The amount of credit available from the Federal Home Loan Bank
fluctuates based on criteria set by that institution concerning the Bank's
portfolio of loans secured by housing for one to four families.  As of December
31, 2000, the Bank had $5,500,000 in borrowings outstanding under this facility,
and no additional borrowings are available based on the Bank's loan portfolio.
At December 31, 2000, the Bank had also borrowed $5,000,000 from the Federal
Home Loan Bank, which is collateralized by securities held in the Bank's
investment portfolio.  Management has chosen to employ this investment growth
strategy in order to maximize the Bank's earnings opportunities over the next
five years, while maintaining a conservative risk position.

The Company has a $3,500,000 revolving credit facility with The Bankers Bank,
Atlanta, Georgia, which is intended to enhance the Company's liquidity.  As of
December 31, 2000, the Company had $1,030,000 borrowed under this facility.
Additionally, CLC established a $1,500,000 revolving credit facility with The
Bankers Bank in July 1999, which is intended to provide a source of funds for
the lending activities of that subsidiary.  As of December 31, 2000, CLC had
$715,921 in borrowed funds outstanding under this facility.  As of July 1999,
the operations of CashTrans are funded principally through a $1,000,000 credit
facility with The Bankers Bank.  As of December 31, 2000, CashTrans had
$1,000,000 in borrowed funds outstanding under this facility.  Under these
revolving credit facilities with The Bankers Bank, interest only is due and
payable on the first business day of each calendar quarter.  The Company's
credit facility (i) accrues interest at a floating rate equal to the "prime"
rate of interest as published from time to time in The Wall Street Journal minus
                                                   -----------------------
1%, and (ii) the principal shall be paid in ten annual installments beginning
July 2003.  CLC's and CashTrans' credit facilities (i) accrue interest at a
floating rate equal to the prime rate minus 0.75%, and (ii) are due in full on
July 1, 2002.  Amounts outstanding under the three credit facilities are
guaranteed by the Company and collateralized by the stock in the Bank.  CLC's
loan is also

                                      -22-
<PAGE>

collateralized by its loan receivables. CashTrans' loan is personally guaranteed
by James R. Henderson, the principal of JRH Diversified, Inc.


Competition
-----------

     Based on total assets of $150,331,347 as of December 31, 2000, the Bank is
presently one of the smaller financial institutions with offices in Paulding and
Cobb Counties.  The Bank faces strong competition for deposits and loans from
numerous other financial institutions, some of which are community banks that
expanded their services from adjacent counties into Paulding County.  Larger
financial institutions have greater resources and lending limits than the Bank,
and typically have more branch offices.  A federal credit union owned by the
employees of a local public utility company also has a branch in Paulding
County.  Since credit unions are not subject to income taxes in the way that
commercial banks are taxed, credit unions have an advantage in offering
competitive rates to potential customers.  The Bank also competes for deposits
and loans with commercial banks and thrift institutions in metropolitan Atlanta,
some of which are affiliated with large regional financial institutions.  The
Bank also faces competition in certain areas of its business from mortgage
banking companies, consumer finance companies, insurance companies, money market
mutual funds and investment banking firms, some of which are not subject to the
same degree of regulation as the Bank.

     The Bank competes for deposits principally by offering depositors a variety
of deposit programs with competitive interest rates, quality service and
convenient locations and hours.  The Bank competes for loans by offering
competitive interest rates and loan fees, timely processing and quality service.
The Bank believes that its relatively small size permits it to offer more
personalized services than many of its competitors.

     The competitive pressures among commercial banks, thrift institutions and
other financial services entities have increased significantly in recent years
and are expected to continue to do so.  The establishment of money market
accounts and the elimination of rate controls for interest rates paid on
deposits in the early 1980s, for example, have increased the competition for
deposits and tend to increase the Bank's cost of funds, especially during
periods of high interest rates.

     Within Georgia, competition among financial institutions is increasing due
to a number of factors including, but not limited to, the acquisition of
Georgia-based financial institutions by out-of-state financial institutions. In
addition to facing increased competition from out-of-state financial
institutions, Georgia-based financial institutions are now likely to face
increased competition from other Georgia-based banks since effective July 1,
1998, Georgia now permits unrestricted state-wide branching.


Employees
---------

     As of December 31, 2000, the Bank had 65 full-time and 16 part-time
employees, Metroplex had 2 full-time employees and 1 part-time employee, CLC had
22 full-time employees, CashTrans

                                      -23-
<PAGE>

had 10 full-time employees and 6 part-time employees, and the Company had 6
full-time employees. No employees are covered by collective bargaining
agreements, and the Company considers its relationship with its employees to be
excellent.


Supervision and Regulation
--------------------------

General

     As a bank holding company, the Company is subject to regulation by the
Board of Governors of the Federal Reserve System (the "Federal Reserve")
pursuant to the Bank Holding Company Act of 1956, as amended ("BHCA") and by the
Georgia Department pursuant to the Financial Institutions Code of Georgia
("FICG").  The Company also is required to file certain reports with, and
otherwise comply with the rules and regulations of, the Securities and Exchange
Commission (the "Commission") under federal securities laws.

     The Bank is a state bank and is subject to the supervision of, and is
regularly examined by, the Georgia Department.  In addition, the Bank's deposit
accounts are insured up to applicable limits by the bank insurance fund of the
Federal Deposit Insurance Corporation (the "FDIC") and the Bank, therefore, is
subject to regulation by the FDIC.

     To the extent that the following information describes statutory and
regulatory provisions, it is qualified in its entirety by reference to the
particular statutory and regulatory provisions.  Any change in applicable laws
or regulations may have a material effect on the business and prospects of the
Company and the Bank.

Regulation of the Company

     General.  As the bank holding company for the Bank, the Company is subject
to the supervision and regulation by the Federal Reserve and the Georgia
Department.  As a bank holding company, the Company is required to file with the
Federal Reserve an annual report and such additional information as the Federal
Reserve may require pursuant to the BHCA.  The Company also files an annual
registration with the Georgia Department pursuant to FICG.  The Federal Reserve
and the Georgia Department also may make examinations of the Company and each of
its subsidiaries.

     Regulatory Capital Requirements. The Federal Reserve and the FDIC have
issued substantially similar risk-based and leverage capital guidelines
applicable to United States banking organizations.  In addition, those
regulatory agencies may from time to time require that a banking organization
maintain capital above the minimum levels, whether because of its financial
condition or actual or anticipated growth.  The Federal Reserve's risk-based
guidelines define a two-tier capital framework.  Tier 1 capital consists of
common and qualifying preferred shareholders' equity, less certain intangibles
and other adjustments.  Tier 2 capital consists of subordinated and other
qualifying debt, and the allowance for credit losses up to 1.25% of risk-
weighted assets.  The sum of Tier 1 and Tier 2 capital less investments in
unconsolidated subsidiaries represents qualifying total

                                      -24-
<PAGE>

capital, at least 50% of which must consist of Tier 1 capital. Risk-based
capital ratios are calculated by dividing Tier 1 and total capital by risk-
weighted assets. Assets and off-balance sheet exposures are assigned to one of
four categories of risk-weights, based primarily on relative credit risk. The
minimum Tier 1 capital ratio is 4% and the minimum total capital ratio is 8%.
The Company's Tier 1 and total risk-based capital ratios under these guidelines
at December 31, 2000 were 12.35% and 13.60% respectively.

     The leverage ratio is determined by dividing Tier 1 capital by adjusted
average total assets.  Although the stated minimum ratio is 3%, all but the most
highly rated bank holding companies are required by the Federal Reserve to
maintain a minimum leverage ratio of 4% to 5%.  The Georgia Department requires
a minimum Tier 1 capital to adjusted total assets ratio of 4%.  The Company's
leverage ratio at December 31, 2000 was 9.96%.

     If the capital of a bank holding company falls below minimum required
levels, the bank holding company may be denied approval to acquire or establish
additional banks or non-bank businesses.  According to Federal Reserve policy,
bank holding companies are expected to act as a source of financial strength to
a subsidiary bank and to commit resources to support such subsidiary.  This
support may be required at times when a bank holding company may not be able to
provide such support.

     Change of Control and Permissible Activities.  Bank holding companies are
required by the BHCA to obtain approval from the Federal Reserve prior to
acquiring, directly or indirectly, ownership or control of more than 5% of the
outstanding shares of any class of voting stock of any bank or bank holding
company.

     The BHCA also prohibits bank holding companies, with certain exceptions,
from acquiring more than 5% of the voting shares of any company that is not a
bank, and from engaging in any business other than banking or managing or
controlling banks or other permissible subsidiaries.  The Federal Reserve is
authorized to approve, among other things, the ownership of shares by a bank
holding company in any company the activities of which the Federal Reserve has
determined to be so closely related to banking or to managing or controlling
banks as to be a proper incident thereto.  Additionally, the Federal Reserve, by
regulation, has deemed certain nonbanking activities to be permissible
activities and has exempted such activities from the prior approval
requirements, although notice to and review by the Federal Reserve of such
activities would be necessary before the Company could engage de novo in such
activities.  The Federal Reserve is empowered to differentiate between
activities that are initiated de novo by a bank holding company or a subsidiary
and activities commenced by acquisition of a going concern.

     However, the activities permissible to bank holding companies and their
affiliates were substantially expanded by the Gramm-Leach-Bliley Act, which the
President signed on November 12, 1999.   Gramm-Leach-Bliley repeals the anti-
affiliation provisions of the Glass-Steagall Act to permit the common ownership
of commercial banks, investment banks and insurance companies.  The BHCA was
amended to permit a financial holding company to engage in any activity and
acquire and retain any company that the Federal Reserve determines to be (a)
financial in nature or incidental to such financial activity or (b)
complementary to a financial activity and does not pose a

                                      -25-
<PAGE>

substantial risk to the safety and soundness of depository institutions or the
financial system generally. The Federal Reserve must consult with the Secretary
of the Treasury in determining whether an activity is financial in nature or
incidental to a financial activity. Holding companies may continue to own
companies conducting activities which had been approved by Federal order or
regulation on the day before Gramm-Leach-Bliley was enacted.

     Additionally, the Federal Change in Bank Control Act requires 60 days'
prior written notice to the appropriate federal bank regulatory agency before
any person may acquire "control" of a bank or bank holding company.  The
appropriate federal bank regulatory agency with respect to acquisitions of
control of a state non-member bank, such as the Bank, is the FDIC, and the
appropriate federal bank regulatory agency with respect to acquisitions of
control of a bank holding company, such as the Company, is the Federal Reserve.

     Under existing Federal Reserve regulations, "control" is presumed to exist
where the acquiring party (which includes a group "acting in concert") (a) owns,
controls, or holds with power to vote 25% or more of any class of voting
securities of the institution, or (b) owns, controls, or holds with power to
vote 10% or more of any class of voting securities of the institution, if (i)
the institution has registered securities under Section 12 of the Securities
Exchange Act of 1934, or (ii) no other person will own a greater percentage of
that class of voting securities immediately following the transaction.

     Supervisory and Enforcement Powers.  The Federal Reserve has been granted
enforcement powers over bank holding companies and non-banking subsidiaries to
forestall activities that represent unsafe or unsound practices or constitute
violations of law.  These powers may be exercised through the issuance of cease-
and-desist orders or other actions.  The Federal Reserve also is empowered to
assess civil money penalties against companies or individuals who violate the
BHCA or orders or regulations thereunder, to order termination of non-banking
activities of non-banking subsidiaries of bank holding companies and to order
termination of ownership and control of a non-banking subsidiary by a bank
holding company.  Certain violations may also result in criminal penalties.

     Restrictions on Transactions with Affiliates.  The Company, Metroplex,
CashTrans and CLC are "affiliates" of the Bank under the Federal Reserve Act,
which imposes certain restrictions on (i) loans by the Bank to the Company, (ii)
investments in the stock or securities of the Company by the Bank, (iii) the
Bank's accepting the stock or securities of one of its affiliates from a
borrower as collateral for loans and (iv) the purchase of assets from the
Company by Bank.  Further, under the BHCA, a bank holding company and its
subsidiaries are prohibited from engaging in certain tie-in arrangements in
connection with any grant of credit, lease or sale of property or furnishing of
services.

     Miscellaneous.  Most bank holding companies are required to give the
Federal Reserve prior written notice of any purchase or redemption of their
outstanding equity securities if the gross consideration for the purchase or
redemption, when combined with the net consideration paid for all such purchases
or redemptions during the preceding 12 months, is equal to 10% or more of the
bank holding company's consolidated net worth.  The Federal Reserve may
disapprove such a purchase or

                                      -26-
<PAGE>

redemption if it determines that the proposal constitutes an unsafe or unsound
practice, or would violate any law, regulation, Federal Reserve order or
directive or any condition imposed by, or written agreement with, the Federal
Reserve. The prior notice requirement does not apply to certain "well-
capitalized" bank holding companies that meet specified criteria.

     In November 1985, the Federal Reserve adopted its Policy Statement on Cash
Dividends Not Fully Covered by Earnings.  The Policy Statement sets forth
various guidelines that the Federal Reserve believes that a bank holding company
should follow in establishing its dividend policy.  In general, the Federal
Reserve stated that bank holding companies should not pay dividends except out
of current earnings and unless the prospective rate of earnings retention by the
holding company appears consistent with its capital needs, asset quality and
overall financial condition.

     The Community Reinvestment Act ("CRA") requires federal bank regulatory
agencies to encourage financial institutions to meet the credit needs of low-
and-moderate-income borrowers in their local communities.  An institution's size
and business strategy determines the type of examination that it will receive.
Large, retail-oriented institutions will be examined using a performance-based
lending, investment and service test.  Small institutions will be examined using
a streamlined approach.   All institutions may opt to be evaluated under a
strategic plan formulated with community input and pre-approved by the bank
regulatory agency.

     CRA regulations provide for certain disclosure obligations.  Each
institution must post a notice advising the public of its right to comment to
the institution and its regulator on the institution's CRA performance and to
review the institution's CRA public file.  Each lending institution must
maintain for public inspection a public file that includes a listing of branch
locations and services, a summary of lending activity, a map of its communities
and any written comments from the public on its performance in meeting community
credit needs.  The CRA requires public disclosure of a financial institution's
written CRA evaluations.  This promotes enforcement of CRA requirements by
providing the public with the status of a particular institution's community
reinvestment record.

     The recently enacted Gramm-Leach-Bliley Act makes various changes to CRA.
Among other changes, CRA agreements with private parties must be disclosed and
annual CRA reports must be made to a bank's primary federal regulator.  A bank
holding company will not be permitted to become a financial holding company and
no new activities authorized under this Act may be commenced by a holding
company or by a bank financial subsidiary if any of its bank subsidiaries
received less than a "satisfactory" CRA rating in its latest CRA examination.

     On November 12, 1999, the President signed the Gramm-Leach-Bliley Act into
law.  The Act:

  .  allows bank holding companies meeting management, capital and CRA standards
to engage in a substantially broader range of nonbanking activities than
currently is permissible, including insurance underwriting and making merchant
banking investments in commercial and financial companies;

                                      -27-
<PAGE>

  .  allows insurers and other financial services companies to acquire banks;

  .  removes various restrictions that currently apply to bank holding company
     ownership of securities firms and mutual fund advisory companies; and

  .  establishes the overall regulatory structure applicable to bank holding
     companies that also engage in insurance and securities operations.

     This part of the Act became effective on March 11, 2000.

     The Act also modifies current law related to financial privacy and
community reinvestment. The new financial privacy provisions will generally
prohibit financial institutions from disclosing nonpublic personal financial
information to third parties unless customers have the opportunity to "opt out"
of the disclosure.

     Georgia Law.  The Company also is a bank holding company within the meaning
of the FICG, which provides without limitation that, without the prior approval
of the Georgia Department, it is unlawful (i) for any action to be taken that
causes a company to become a bank holding company, (ii) for any bank holding
company to acquire direct or indirect ownership or control of more than 5% of
the voting shares of any bank, (iii) for any bank holding company or subsidiary
thereof, other than a bank, to acquire all or substantially all of the assets of
a bank, (iv) for any action to be taken that causes a bank to become a
subsidiary of a bank holding company or (v) for any bank holding company to
merge or consolidate with any other bank holding company.  It also is unlawful
for any company to acquire direct or indirect ownership or control of more than
5% of the voting shares of any bank in Georgia unless such bank has been in
existence and continuously operating as a bank for a period of five years or
more prior to the date of application to the Georgia Department for approval of
such acquisition.  One bank holding companies, such as the Company, are
prohibited from acquiring another bank until their initial bank subsidiary has
been incorporated for a period of at least two years.

Regulation of the Bank

     General.  The Bank is a commercial bank chartered under the laws of the
State of Georgia and its deposit accounts are insured up to applicable limits by
the Bank Insurance Fund (BIF) of the FDIC.  The Bank is subject to the
regulation, examination and supervision of the Georgia Department and the FDIC.
Both the Georgia Department and the FDIC issue regulations and require the
filing of reports describing the activities and financial condition of the banks
under their jurisdiction.  Each agency conducts periodic examinations to test
compliance with various regulatory requirements and generally supervises the
operation of such banks.  This supervision and regulation are intended primarily
for the protection of depositors.  As an FDIC-insured, state-chartered bank, the
Bank may not enter into certain transactions unless applicable regulatory tests
are met or it obtains the prior approval of the regulatory agencies.  For
instance, the approval of the Georgia

                                      -28-
<PAGE>

Department and the FDIC are required prior to any merger or consolidation or the
establishment of an office at which banking business is conducted. The Bank also
is regulated in certain respects by the Federal Reserve.

     Georgia Law.  The Bank derives its lending and investment authority
primarily from the applicable provisions of the FICG and the rules and
regulations promulgated thereunder by the Georgia Department.  Under these laws
and regulations, commercial banks, including the Bank, may invest in real estate
mortgages, commercial and consumer loans, certain types of securities, including
certain corporate debt and equity securities, asset backed securities, and
obligations of federal, state and local governments and agencies, and certain
other assets.  A Georgia chartered bank's lending powers generally are subject
to certain restrictions, including limits on amounts loaned to one borrower.
Additionally, the exercise by an FDIC insured commercial bank of the lending and
investment powers of a commercial bank under the FICG may be limited by FDIC
regulations.

     Georgia commercial banks may, with the approval of the Georgia Department,
merge or consolidate with another bank, trust company or other corporation as
long as the resulting institution is a bank or trust company engaged only in the
business of a bank or trust company.  Additionally, a bank may sell, lease,
exchange or otherwise dispose of all or substantially all of its property and
assets with the approval of the Georgia Department.

     The FICG prohibits the payment of dividends by a state chartered bank if
such bank is insolvent or would thereby be rendered insolvent, if such dividend
is contrary to restrictions contained in the bank's articles of incorporation,
if the dividend would be paid from other than retained earnings or if the bank
does not have the required amount of paid-in capital and appropriated retained
earnings.  In addition, pursuant to regulations adopted by the Georgia
Department, a Georgia-chartered bank must have the approval of the Georgia
Department to pay cash dividends, unless at the time of such payment (i) the
total classified assets at the most recent examination of the bank do not exceed
80% of the bank's equity capital and reserves as reflected by such examination;
(ii) the aggregate amount of dividends declared or anticipated to be declared in
the calendar year does not exceed 50% of the net profits, after taxes but before
dividends, of the bank for the previous calendar year; and (iii) the ratio of
the bank's equity capital, as defined, to adjusted total assets, as defined, is
not less than 6%.

     Under FICG, the Georgia Department may issue orders to a Georgia chartered
bank to submit to an investigation by the Georgia Department, to discontinue
unauthorized or unsafe practices or to keep prescribed books and accounts.  If
the Georgia Department finds that any director or officer of any banking
organization has violated any law or duly enacted regulation, or has continued
unauthorized or unsafe practices in conducting the business of the banking
organization after being notified by the Georgia Department to discontinue such
practices, or has been indicted for any crime involving moral turpitude or
breach of trust, or has filed for bankruptcy protection from creditors, the
Georgia Department may remove such director or officer from office.  No director
or officer of the Bank has been found by the Georgia Department to have engaged
in, or has been investigated by the Georgia Department with respect to, any of
such activities.

                                      -29-
<PAGE>

Insurance of Accounts

     Deposits of the Bank are insured by the FDIC to a maximum of $100,000 for
each insured depositor through the Bank Insurance Fund.  As an insurer, the FDIC
issues regulations, conducts examinations and generally supervises the
operations of its insured institutions (institutions insured by the FDIC
hereinafter are referred to as "insured institutions").  Any insured institution
which does not operate in accordance with or conform to FDIC regulations,
policies and directives may be sanctioned for non-compliance.  For example,
proceedings may be instituted against an insured institution if the institution
or any director, officer or employee thereof engages in unsafe and unsound
practices, is operating in an unsafe or unsound condition, or has violated any
applicable law, regulation, rule, order or condition imposed by the FDIC.  If
insurance of accounts is terminated by the FDIC, the deposits in the institution
will continue to be insured by the FDIC for a period of two years following the
date of termination.  The FDIC requires an annual audit by independent
accountants and also periodically makes its own examinations of insured
institutions.  The FDIC may revalue assets of an institution, based upon
appraisals, and require establishment of specific reserves in amounts equal to
the difference between such reevaluation and the book value of the assets.

     The FDIC has adopted a risk-related deposit insurance system.  Under the
risk-related insurance regulations, each insured depository institution is
assigned to one of three risk classifications: "well capitalized," "adequately
capitalized," or "under capitalized."  Within each risk classification, there
are three subgroups.  Each insured depository institution is assigned to one of
these subgroups within its risk classification based upon supervisory
evaluations submitted to the FDIC by the institution's primary federal
regulator.  Depending upon a BIF member's risk classification and subgroup,
applicable regulations provide that its deposit insurance premium may be as low
as .04% of insured deposits or as high as .31% of insured deposits.  The Bank
has been notified that, based on its risk classification and supervisory
subgroup, its BIF assessment rate is zero percent of insured deposits for the
period from January 1, to June 30, 2000.  This is the most favorable assessment
rate applicable to any insured institution.  However, the Deposit Insurance
Funds Act of 1996 ("DIFA") requires that a Financing Corporation ("FICO")
assessment be paid by the Bank in 2000. The annual FICO assessment rate for
banks is presently .0203% of deposits. The Bank paid $21,648 in assessments,
which was the minimum set by the FDIC for that period, during the year ended
December 31, 2000.

     The FDIC has issued risk-based and leverage capital guidelines similar to
that issued by the Federal Reserve and discussed above.  At December 31, 2000,
the Bank had Tier 1 capital of $11,240,000, or 7.40% of total average assets.

     Certain provisions of the Federal Reserve Act, made applicable to the Bank
by Section 18(j) of the Federal Deposit Insurance Act (12 U.S.C. (S)1828(j)) and
administered with respect to the Bank by the FDIC, establish standards for the
terms of, limit the amount of and establish collateral requirements with respect
to any loans or extensions of credit to, and investments in, affiliates by the
Bank as well as set arms-length criteria for such transactions and for certain
other transactions (including payment by the Bank for services) between the Bank
and its affiliates.  In addition, related provisions of the Federal Reserve Act
and the Federal Reserve regulations (also administered with

                                      -30-
<PAGE>

respect to the Bank by the FDIC) limit the amounts of, and establish required
procedures and credit standards with respect to, loans and other extensions of
credit to officers, directors and principal shareholders of the Bank and to
related interests of such persons.

     The FDIC may impose sanctions on any insured bank that does not operate in
accordance with FDIC regulations, policies and directives.  Proceedings may be
instituted against any insured bank or any director, officer or employee of the
bank that is believed by the FDIC to be engaged in unsafe or unsound practices,
including violation of applicable laws and regulations.  The FDIC may revalue
assets of an institution, based upon appraisals, and may require the
establishment of specific reserves in amounts equal to the difference between
such revaluation and the book value of the assets.  The FDIC also is empowered
to assess civil penalties against companies or individuals who violate certain
federal statutes, orders or regulations.  In addition, the FDIC has the
authority to terminate insurance of accounts, after notice and hearing, upon a
finding by the FDIC that the insured institution is or has engaged in any unsafe
or unsound practice that has not been corrected, or is in an unsafe or unsound
condition to continue operations or has violated any applicable law, regulation,
rule or order of, or condition imposed by, the FDIC.  The Bank does not know of
any past or current practice, condition or violation that might lead to
termination of its deposit insurance or to any proceeding by the FDIC against
the Bank or any of its directors, officers or employees.

     Federal Reserve.  Although the Bank is not a member of the Federal Reserve
System, it is subject to Federal Reserve regulations that require it to maintain
reserves against its transaction accounts (primarily checking accounts).
Because reserves generally must be maintained in cash or in non-interest bearing
accounts, the effect of the reserve requirements is to increase the Bank's cost
of funds.  The Federal Reserve regulations currently require that average daily
reserves be maintained against transaction accounts in the amount of 3% of the
aggregate of such net transaction accounts up to $46.5 million, plus 10% of the
total in excess of $46.5 million.

     Prompt Corrective Action.  The Federal Deposit Insurance Act ("FDIA"),
among other things, requires the federal regulatory agencies to take "prompt
corrective action" if a depository institution does not meet minimum capital
requirements.  The FDIA establishes five capital tiers:  "well capitalized;"
"adequately capitalized;" "undercapitalized;" "significantly undercapitalized;"
and "critically undercapitalized."  A depository institution's capital tier will
depend upon how its capital levels compare to various relevant capital measures
and certain other factors, as established by regulation.

     The federal bank regulatory agencies have adopted regulations establishing
relevant capital measures and relevant capital levels applicable to FDIC-insured
banks.  The relevant capital measures are the total capital ratio, tier 1
capital ratio and the leverage ratio.  Under the regulations, a FDIC-insured
bank will be:

          "well capitalized" if it has a total capital ratio of 10% or greater,
          a tier 1 capital ratio of 6% or greater and a leverage ratio of 5% or
          greater and is not subject to any order or written directive by the
          appropriate regulatory authority to meet and maintain a specific
          capital level for any capital measure;

                                      -31-
<PAGE>

          "adequately capitalized" if it has a total capital ratio of 8% or
          greater, a tier 1 capital ratio of 4% or greater and a leverage ratio
          of 4% or greater (3% in certain circumstances) and is not "well
          capitalized;"

          "under capitalized" if it has a total capital ratio of less than 8%, a
          tier 1 capital ratio of less than 4% or a leverage ratio of less than
          4% (3% in certain circumstances);

          "significantly undercapitalized" if it has a total capital ratio of
          less than 6%, a tier 1 capital ratio of less than 3% or a leverage
          ratio of less than 3%; and

          "critically undercapitalized" if its tangible equity is equal to or
          less than 2% of average quarterly tangible assets.

     An institution may be downgraded to, or deemed to be in, a capital category
that is lower than is indicated by its capital ratios if it is determined to be
in an unsafe or unsound condition or if it receives an unsatisfactory
examination rating with respect to certain matters.  As of December 31, 2000,
the Company and the Bank each had capital levels that qualify each as being
"well capitalized" under such regulations.

     The FDIA generally prohibits a FDIC-insured bank from making any capital
distribution (including payment of a dividend) or paying any management fee to
its holding company if the bank would thereafter be "undercapitalized."
"Undercapitalized" banks are subject to growth limitations and are required to
submit a capital restoration plan.  The federal regulators may not accept a
capital plan without determining, among other things, that the plan is based on
realistic assumptions and is likely to succeed in restoring the bank's capital.
In addition, for a capital restoration plan to be acceptable, the bank's parent
holding company must guarantee that the institution will comply with such
capital restoration plan.  The aggregate liability of the parent holding company
is limited to the lesser of: (i) an amount equal to 5% of the bank's total
assets at the time it became "undercapitalized;" and (ii) the amount which is
necessary (or would have been necessary) to bring the institution into
compliance with all capital standards applicable with respect to such
institution as of the time it fails to comply with the plan.  If a bank fails to
submit an acceptable plan, it is treated as if it is "significantly
undercapitalized."

     "Significantly undercapitalized" insured banks may be subject to a number
of requirements and restrictions, including orders to sell sufficient voting
stock to become "adequately capitalized," requirements to reduce total assets,
and cessation of receipt of deposits from correspondent banks.  "Critically
undercapitalized" institutions are subject to the appointment of a receiver or
conservator.  A bank that is not "well capitalized" is subject to certain
limitations relating to so-called "brokered" deposits.

Other Legislation

     In September 1994, the federal Riegle-Neal Interstate Banking and Branching
Efficiency Act was enacted.  The Act allows bank holding companies, beginning
one year following enactment of the legislation, to acquire existing banks
across state lines, regardless of state statutes.  Beginning in

                                      -32-
<PAGE>

June 1997, banks were permitted to consolidate interstate subsidiaries into
branches and merge with a bank across state lines to the extent that the
applicable states had not "opted out of interstate branching" prior to the
effectiveness of the branching provisions. The Act also permits de novo
branching to the extent that a particular state opts into the de novo branching
provisions. The Act provides a concentration limitation with a nationwide
limitation of 10% of total deposits of insured depository institutions in the
United States and 30% of total deposits of insured depository institutions in a
specific state.

     The Riegle Community Development and Regulatory Improvement Act of 1994
also was enacted in September 1994, and provides for the creation of a community
development financial institutions fund to promote economic revitalization in
community development.  Banks and savings institutions are allowed to
participate in such community development banks.  The Act also contains
provisions designed to enhance small business capital formation and to enhance
disclosure with regard to high cost mortgages for the protection of consumers.
The Act also contains more than 50 regulatory relief provisions that apply to
banks and savings institutions including the coordination of examinations by
various federal agencies, coordination of frequency and types of reports
financial institutions are required to file and reduction of examinations for
well-capitalized institutions.

     The Georgia legislature enacted legislation which, effective July 1, 1996,
allowed Georgia-based banks to branch into up to three counties in addition to
the county in which their main office is located.  This same legislation
eliminated all branching restrictions, thereby permitting unrestricted state-
wide branching, effective July 1, 1998.

Regulation of CLC

     As a consumer finance company, CLC is subject to regulation by the
Commissioner of Insurance of the State of Georgia, also known as the Georgia
Industrial Loan Commissioner (the "Commissioner"), pursuant to the Georgia
Industrial Loan Act (the "GILA").  CLC is required to file certain reports and
such additional information as the Commissioner may require pursuant to the
GILA, and is subject to periodic examinations of its books, accounts, and
records by the Commissioner's duly authorized representatives.  Each office of
CLC is licensed by the Commissioner separately, and, if CLC wishes to move an
office within a county, written notice must be given to the Commissioner
supplying facts and circumstances showing how the removal to a new location will
promote the convenience and advantage of that community.  Licenses must be
renewed on an annual basis.  CLC may loan any sum of money not to exceed $3,000
for a period not to exceed 36 months and 15 days and may charge, contract for,
collect, and receive interest and fees on said loans, pursuant to the GILA.

     As a subsidiary of the Company, CLC also is subject to examination by the
Federal Reserve pursuant to the BHCA and by the Georgia Department pursuant to
the FICG.  The Federal Reserve and the Georgia Department also may make
examinations of CLC.

                                      -33-
<PAGE>

ITEM 2.  DESCRIPTION OF PROPERTY
--------------------------------


     The Company operates from an office in Paulding County, which is adjacent
to the Bank's main office.  The Company owns the land and building, which was
built in 2000 and contains approximately 9,600 square feet.  The facility is
located at 342 Marietta Highway in Hiram, Georgia.  Fairgreen Capital L.P. d/b/a
Northside Realty leases 2,627 square feet of the space for a total annual rent
amount of $39,405.

     The Bank operates from a main office and four branch offices in Paulding
and Cobb Counties in Georgia.  The main office, built in 1988 and located at
3844 Atlanta Highway in Hiram, Georgia, contains approximately 16,000 square
feet.  The Bank owns the land and the building at this location.  CashTrans
leases office space in Dallas, Georgia.  CLC leases office space in the Georgia
cities of Woodstock, Rockmart, Rossville, Gainesville, Dalton, Rome, Dahlonega,
and Cartersville.

     The Bank opened a full service branch office at 100 Hardee Street, Dallas,
Paulding County, Georgia in June 1991.  The Bank leases the land and owns the
building at this location, which contains approximately 1,150 square feet and
includes three teller stations and two drive-in window teller stations.  The
lease on this property has been extended until June 2002.  In December 1991, the
Bank also opened a full service office located in the Kroger grocery store of
the Paulding Commons Shopping Center, 4215 Jimmy Lee Smith Parkway in Hiram,
Georgia.  The Bank leases its office space in the grocery store and owns the
furniture, fixtures and equipment used in the Bank office.  In January 1999, the
Bank opened a full service office at 3161 Cobb Parkway, Suite 100, Kennesaw,
Georgia which is located in the Butler Crossing Shopping Center.  The Bank
leases its office space in the shopping center and owns the furniture, fixtures,
and equipment used in the Bank office.  In January 2000, the Bank opened a full
service office at 1690 Powder Springs Road SW, Building 300 Suite A, Marietta,
Georgia which is located in the Battle Ridge Shopping Center.  The Bank leases
its office space in the shopping center and owns the furniture, fixtures, and
equipment used in the Bank office.

     At December 31, 2000, the cost of office properties and equipment (less
allowances for depreciation and amortization) owned by the Company was
$4,952,767.  Data processing services are provided by an outside service bureau.

     The Company believes that its facilities are adequate and suitable for the
Company's current business and its anticipated business for the foreseeable
future.

     The Company is unaware of any potential environmental liability that it may
incur in connection with any properties or other assets owned by it.

     None of the properties owned by the Company or the Bank are subject to
encumbrances.

                                      -34-
<PAGE>

ITEM 3.  LEGAL PROCEEDINGS
--------------------------

     There are no material legal proceedings to which the Company or the Bank is
a party or to which any of their properties is subject.  The Bank and CLC are
periodically involved as a plaintiff or defendant in various legal actions in
the ordinary course of its business.


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

     No matters were submitted to a vote of shareholders of the Company during
the fourth quarter of the Company's fiscal year ended December 31, 2000.



                                    PART II
                                    -------


ITEM 5.  MARKET FOR THE COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
---------------------------------------------------------------------

     The Company's Common Stock is listed on the over-the-counter bulletin board
with the symbol CTFV. Morgan Keegan & Company, Inc. (Morgan Keegan) acts as a
market maker for the Company's Common Stock. There was no established trading
market for the Company's Common Stock in 2000. During the year ended December
31, 2000, the Company believes that the trading prices of the Company's Common
Stock have ranged between $8.75 and $9.50 per share.

     The Company paid cash dividends on its Common Stock of $.12 per share to
stockholders in both 2000 and 1999, respectively, and the Company paid cash
dividends on its Common Stock of $.04 per share to stockholders of record as of
February 7, 2001.  In December 1999, the Board of Directors declared a 2 for 1
stock split in the form of a stock dividend to shareholders of record on January
18, 2000, therefore, all per share amounts have been changed to reflect the
stock split as if it had occurred prior to 1999.  The payment of dividends by
the Company, however, is at the discretion of the Board of Directors and is
effectively limited by the Company's regulators.

     The Company had 797 shareholders of record as of March 20, 2001.

     The Company's ability to pay dividends is dependent on dividends paid by
the Bank, if any.  Additionally, Georgia law imposes certain restrictions on the
payment of cash dividends by the Bank.  See "Item 1. Business - Supervision and
Regulation."

                                      -35-
<PAGE>

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
------------------------------------------------------------------


Selected Consolidated Financial Data
------------------------------------


     The selected annual consolidated financial data set forth below under the
headings "Balance Sheet Data" and "Statement of Earnings Data" are derived from
the audited consolidated financial statements of the Company and its
subsidiaries.  The information below should be read in conjunction with the
audited financial statements and related notes and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" set forth elsewhere
herein.


<TABLE>
<CAPTION>
                                                   2000          1999          1998         1997         1996
                                                   ----          ----          ----         ----         ----
<S>                                         <C>           <C>           <C>           <C>          <C>
Balance Sheet Data
Total assets                                156,548,950   131,742,794   107,528,272   91,904,781   85,203,618
Loans, net                                  107,643,851    88,256,999    73,504,927   56,359,625   48,712,195
Deposits                                    120,165,637   104,412,264    86,906,529   81,981,103   76,897,761
Stockholders equity                          15,895,324    14,763,404    13,971,203    7,869,832    6,877,876

Statement of Earnings Data
Net interest income                           7,568,145     6,808,173     5,508,099    4,719,701    4,187,352
Provision for loan losses                       591,010       695,062       336,243      204,270      197,841
Noninterest income                            2,332,303     1,856,200     1,578,958    1,203,961    1,151,183
Noninterest expense                           7,868,936     6,866,150     4,985,623    4,236,313    3,575,171
Net earnings                                  1,070,392       862,538     1,259,896    1,038,807    1,057,884
Basic earnings per share/(1)/                      0.45          0.37          0.65         0.62         0.63
Diluted earnings per share/(1)/                    0.43          0.35          0.63         0.59         0.62

Asset Quality Ratios
Nonperforming assets to total assets/(2)/          0.74%         0.88%         0.73%        0.62%        0.20%
Net chargeoffs to average loans                    0.25%         0.42%         0.35%        0.17%        0.15%
Allowance for loan losses to total loans           1.53%         1.51%         1.26%        1.45%        1.44%
Allowance for loan losses to
   nonperforming assets/(2)/                     144.54%       117.29%       118.41%      145.07%      420.00%

Key Performance Ratios
Return on average assets                           0.74%         0.73%         1.28%        1.19%        1.39%
Return on average equity                           7.02%         6.02%        12.50%       14.44%       16.65%
Net interest margin                                5.66%         6.20%         6.00%        5.93%        5.89%
Net interest spread                                4.96%         5.36%         5.18%        5.17%        5.23%
Average equity to average assets                  10.53%        12.15%        10.23%        8.27%        8.32%
Noninterest expense to average assets              5.43%         5.83%         5.06%        4.88%        4.67%
Efficiency ratio/(3)/                             79.48%        79.25%        70.35%       71.52%       66.97%
Dividends per share/(1)/                           0.12          0.12          0.12         0.12         0.12
Dividend payout ratio                             26.82%        33.28%        16.71%       20.20%       19.77%
</TABLE>

___________________________________
/(1)/  In December 1999, the Board of Directors declared a 2 for 1 stock split
in the form of a stock dividend to shareholders of record on January 18, 2000.
All per share amounts have been changed to reflect the stock split as if it had
occurred December 31, 1995.
/(2)/  Nonperforming assets have been restated prior to 2000 to include accruing
loans which are contractually past due 90 days or more.
/(3)/ The efficiency ratio is calculated by dividing noninterest expense by the
sum of net interest income and noninterest income.

                                      -36-
<PAGE>

Management's Discussion and Analysis
------------------------------------
Of Financial Condition and Results of Operations

Overview

     Management's discussion and analysis of financial condition and results of
operations analyzes the material changes in the consolidated balance sheets and
statements of earnings presented herein for Community Trust Financial Services
Corporation (the "Company").  The consolidated financial information includes
the financial condition and results of operations, for all periods presented, of
the Company and its wholly-owned subsidiaries, Community Trust Bank (the
"Bank"), Metroplex Appraisals, Inc. ("Metroplex"), and Community Loan Company
("CLC").  The Company owns a 49% interest in Cash Transactions, L.L.C.
("CashTrans") which is treated as an unconsolidated subsidiary for financial
reporting purposes, and, accordingly, the Company's interest is reflected in the
consolidated financial statements at its proportionate share.

     At December 31, 2000, the Company had consolidated total assets of
$156,548,950 as compared to $131,742,794 at December 31, 1999, primarily due to
growth in the Bank's assets.  Stockholders' equity increased approximately 7.67%
to $15,895,324 or $6.63 per share at December 31, 2000, as compared to
stockholders' equity of $14,763,404 or $6.19 per share at December 31, 1999.
Stockholders' equity increased primarily due to comprehensive income of
$1,349,602.  For the year ended December 31, 2000, the Company's comprehensive
income consisted of $1,070,392 in net earnings and a $279,210 gain in other
comprehensive income, which is composed of changes in the unrealized gain or
loss on securities available for sale, net of tax.  The Company's net interest
income for the year ended December 31, 2000, increased approximately 11.16% or
$759,972 from its net interest income for the year ended December 31, 1999.  The
Company's net earnings increased 24.10% from $862,538 for the year ended
December 31, 1999 to $1,070,392 for the year ended December 31, 2000, while its
basic earnings per share (based on the weighted average number of shares
outstanding during the year) increased from $0.37 to $0.45.  This increase in
earnings growth compared to growth in net interest income was attributable
primarily to a 25.65% increase in noninterest income that resulted largely from
(i) an increase in miscellaneous income primarily due to the Bank's sale of
other investments which resulted in a gain of $154,813, (ii) an increase of
$179,862 in insurance commissions which is primarily due to growth in CLC's
insurance commissions, and (iii) an increase of $106,047 in the Bank's mortgage
banking income.

     For the year ended December 31, 2000, the Bank recorded net earnings of
$1,455,356, an increase of 20.68% or $249,435 from the year ended December 31,
1999, which is primarily due to an increase in the Bank's net interest income.
For the year ended December 31, 2000, CLC recorded net earnings of $68,180.  For
the year ended December 31, 2000, CashTrans experienced a loss of $303,391,
primarily due to increased salary cost.  Under the equity method of accounting,
49% of this loss, or $148,662, is reflected in the Company's noninterest income
for the year ended December 31, 2000.

     Management is pleased with the Company's results for 2000.  While it is
true that the Company's results of operations for 2000 were adversely affected
by CashTrans' losses, these losses were consistent with management's
expectations due to the subsidiary's swift growth during 2000.  CashTrans may
continue to experience losses as that company strives to gain market share in
its

                                      -37-
<PAGE>

industry. Management believes that while it may be typical for companies to
experience some temporary loss in earnings during times of very concentrated
growth, this same growth is necessary for the long-term success of the Company.

     The Company's results of operations are primarily dependent upon the Bank's
results of operations.  The Bank represents 96.03% and 87.08%, respectively, of
the Company's total assets and total revenues at December 31, 2000, as compared
to 96.14% and 86.50%, respectively, of the Company's total assets and total
revenues at December 31, 1999.  The Bank's business consists primarily of
attracting deposits from the general public and, with these and other funds,
originating real estate loans, consumer loans, business loans, and residential
and commercial construction loans.  Funds not invested in the loan portfolio are
invested by the Company primarily in U.S. Government and agency obligations and
obligations of various states and their political subdivisions.  The Company's
earnings are dependent primarily upon the Bank's net interest income, which is
the difference between the interest income received from its assets (primarily
loans and investment securities) and the interest expense (or "cost of funds")
which it pays on its liabilities (primarily deposits).  The Bank's profitability
also is affected by such factors as noninterest income and expenses, the
provision for loan losses and income tax expense.  Noninterest income consists
primarily of service charges on deposits and gains or losses on the sale of
investment securities.  Noninterest expenses consist of salaries and employee
benefits, occupancy expenses, FDIC deposit insurance premiums and other
operating expenses such as data processing costs, printing, postage and
supplies, and professional fees.

     CLC began operations in September 1995 for the purpose of acquiring and
operating consumer finance offices under the direction of the Company.  In 1999,
CLC conducted its operations from eleven offices located in Gainesville,
Rockmart, Rossville, Dalton, Oakwood, Rome, Woodstock, Dahlonega, Griffin, and
two in Cartersville, Georgia.  During 2000, CLC sold assets consisting primarily
of $351,292 in loans related to three consumer finance offices and recorded a
total gain on the sale of $63,365.  The first office sold was in Griffin,
Georgia, which is located outside CLC's target geographic market area.  During
the third quarter, two offices were sold in the cities of Cartersville and
Oakwood, Georgia, as both offices were located in close proximity to other
offices of CLC.  CLC presently operates from eight relatively small offices.
CLC represents 3.08% and 12.42%, respectively, of the Company's total assets and
total revenues at December 31, 2000, as compared to 3.67% and 11.16%,
respectively, of the Company's total assets and total revenues at December 31,
1999.  CLC's net profit was $68,180 for 2000, including the gain on the assets
previously discussed.  Management believes that CLC represents a prudent and,
ultimately, profitable means of diversifying the Company's business lines and
that CLC represents a significant long-term growth opportunity for the Company.

     CashTrans was formed in 1997 as a joint venture between the Company and JRH
Diversified, Inc. to engage in the business of providing retail establishments
(primarily convenience stores) with automated teller machines that are owned by
CashTrans and that dispense cash or cash equivalents.  In 1999, CashTrans
diversified its business into selling the same types of machines to retail
establishments, if the retailer so desires.  While CashTrans remains focused on
placing its machines in space which is strategically located to encourage
transactions, CashTrans will sell machines, thereby earning income on the sales
and on future maintenance of the machines.  CashTrans represents 0.37% and
5.46%, respectively, of the Company's total assets and total revenues at

                                      -38-
<PAGE>

December 31, 2000, as compared to 0.50% and 6.13%, respectively, of the
Company's total assets and total revenues at December 31, 1999. Because
CashTrans was initially capitalized with only $100,000, $49,000 of which
represented the Company's investment, the cumulative loss of $692,388
experienced by CashTrans made it insolvent at the end of 2000. The relatively
small initial capitalization of CashTrans reflects the desire of the Company and
JRH Diversified, Inc. to fund CashTrans' operations with debt financing rather
than equity contributions. CashTrans provides a network of cash outlets
throughout the Southeast, allowing the Bank a competitive advantage in its
market through a branding agreement between the two affiliates. Additionally,
CashTrans has experienced success in the growth of its franchise, and management
expects continued success in marketing CashTrans' services. Management believes
that CashTrans represents a prudent and, ultimately, profitable investment for
the Company as well as a significant long-term growth opportunity for the
Company.

     Metroplex, a wholly-owned subsidiary of the Company, was formed in 1992 as
an appraisal service company.  Metroplex performs appraisals of residential and
commercial properties located in Paulding, Bartow, Polk, Harralson, Floyd, Cobb,
Douglas, and Cherokee counties, Georgia.  Metroplex represents 0.02% and 1.09%,
respectively, of the Company's total assets and total revenues at December 31,
2000, as compared to 0.03% and 1.83%, respectively, of the Company's total
assets and total revenues at December 31, 1999.  Net earnings of Metroplex for
the year ended December 31, 2000, were $5,019, as compared to $14,153 in net
earnings for the year ended December 31, 1999.  Metroplex does not have a
significant impact on the consolidated results of operations of the Company and
management does not anticipate that its impact will be significant in future
periods.  Management believes that Metroplex represents a desirable activity for
the Company to be engaged in because, among other things, Metroplex requires the
commitment by the Company of relatively modest resources and enables the Bank to
receive reliable appraisals in connection with residential real estate loans
originated by the Bank.


Results of Operation
Year Ended December 31, 2000 Compared to Year Ended December 31, 1999

Net Interest Income

     Net interest income is a function of (1) the difference between rates of
interest earned on interest-earning assets and rates of interest paid on
interest-bearing liabilities (the "interest rate spread") and (2) the relative
amounts of interest-earning assets and interest-bearing liabilities.  When
interest-earning assets approximate or exceed interest-bearing liabilities, any
positive interest rate spread will generate net interest income.

     The Company's net interest income increased approximately 11.16% to
$7,568,145 for the year ended December 31, 2000, as compared to $6,808,173 for
the year ended December 31, 1999, primarily due to an increase in earning
assets.  Interest income increased approximately 25.54% to $13,194,789 for 2000,
as compared to $10,510,818 for 1999, due primarily to an approximate 20.96%
increase in the average loan portfolio for 2000 as compared to 1999.  Interest
expense increased approximately 51.96% to $5,626,644 for 2000, as compared to
$3,702,645 for 1999, due

                                      -39-
<PAGE>

primarily to an approximate 29.81% increase in the average amount of interest-
bearing deposits and liabilities of the Company.

     The Company's average earning assets for the year ended December 31, 2000
were $133,263,936, having a weighted average yield of 9.87%, resulting in a net
interest margin of 5.66% for 2000.  This compares to average earning assets for
the year ended December 31, 1999 of $109,872,183, having a weighted average
yield of 9.57%, resulting in a net interest margin of 6.20% for 1999.  The
decrease in net interest margin is attributable primarily to the increase in the
Company's cost of funds from 4.21% for the year ended December 31, 1999 to 4.91%
for the year ended December 31, 2000.

Provision for Loan Losses

     The Company loses interest income due to non-performing assets, defined as
loans placed on non-accrual status, accruing loans which are contractually past
due ninety days or more, real estate acquired through foreclosure, and property
acquired through repossession.  Management considers the Company's level of non-
performing assets to be at an acceptable level.  The Company's non-performing
assets totaled $1,160,911, or 0.74% of total assets as of December 31, 2000, as
compared to $1,156,627, or 0.88% of total assets as of December 31, 1999.

     The Georgia Department of Banking and Finance (the "Department"), the
Bank's primary regulatory authority, requires the Bank to maintain a loan loss
allowance of not less than one percent of all outstanding loans. This allowance
is used to cover future loan losses. During 2000, the Company sustained $254,731
in net loan losses as compared to $349,898 in net losses in 1999. Both the Bank
and CLC maintain an allowance for loan losses, and management adjusts the
general allowances monthly by charges to income in response to changes to
outstanding loan balances, net charge-offs, delinquencies, and management's
assessment of the quality of the loan portfolio and general economic conditions.
The Company's provision for loan losses was $591,010 for the year ended December
31, 2000, as compared to $695,062 for the year ended December 31, 1999. The
Company's loan loss allowance was $1,677,936, or 1.53% of outstanding loans, as
of December 31, 2000, as compared to $1,356,649, or 1.51% of outstanding loans,
as of December 31, 1999. No material loss is anticipated on non-accrual or
restructured loans, therefore no specific reserves or writedowns were considered
necessary by management as of December 31, 2000.

Noninterest Income

     Total noninterest income, consisting of service charges on deposits,
appraisal fees, credit life insurance commissions, mortgage banking income, loss
in CashTrans and other miscellaneous income, increased approximately 25.65% to
$2,332,303 for the year ended December 31, 2000, as compared to total
noninterest income of $1,856,200 for the year ended December 31, 1999.  The
increase in noninterest income resulted primarily from (i) an increase in
miscellaneous income primarily due to the Bank's sale of other investments which
resulted in a gain of $154,813, (ii) an increase of $179,862 in insurance
commissions which is primarily due to growth in CLC's insurance commissions, and
(iii) an increase of $106,047 in the Bank's collection of mortgage origination
fees related to its mortgage division.

                                      -40-
<PAGE>

Noninterest Expenses

     Noninterest expenses, consisting of salaries and employee benefits,
occupancy and other miscellaneous expenses, increased approximately 14.60% to
$7,868,936 for 2000, as compared to $6,866,150 for 1999.  This increase is
attributable primarily to a 20.95% increase in salaries and employee benefits
caused by the Company's need for additional human resources due to the growing
customer base of the Bank and CLC, as well as routine salary increases.
Additionally, pressures on employment costs in the Company's primary market
areas have caused some increase in salaries and benefits in order to attract and
retain key employees.  Occupancy expense increased by approximately $289,136, or
28.18%, for the year ended December 31, 2000, as compared to the same period in
1999, primarily due to costs of the Bank's branches.

Income Tax Expense

     Total income tax expense for the year ended December 31, 2000 was $370,110
as compared to $240,623 for the year ended December 31, 1999.  The effective tax
rate increased from 21.81% at December 31, 1999 to 25.69% at December 31, 2000.
This increase was due primarily to relatively flat tax-exempt interest income
earned by the Bank while there was a 30.58% increase in the Company's earnings
before income taxes.


Results of Operation
Year Ended December 31, 1999 Compared to Year Ended December 31, 1998

Net Earnings

     The Company's net earnings for 1999 were $862,538, an approximate 31.54%
decrease from net earnings of $1,259,896 for 1998.  The decrease in earnings was
attributable primarily to the Company's 37.72% increase in noninterest expense
that resulted largely from the Bank's and CLC's increased overhead expenses, and
provision for loan losses made by CLC and the Bank.

Net Interest Income

     The Company's net interest income increased approximately 23.60% to
$6,808,173 for the year ended December 31, 1999, as compared to $5,508,099 for
the year ended December 31, 1998.  Interest income increased approximately
19.48% to $10,510,818 for 1999, as compared to $8,797,172 for 1998, due
primarily to an approximate 29.52% increase in the average loan portfolio for
1999 as compared to 1998.  Interest expense increased approximately 12.57% to
$3,702,645 for 1999, as compared to $3,289,073 for 1998, due primarily to an
approximate 18.02% increase in the average amount of interest-bearing deposits
and liabilities of the Company.

     The Company's average earning assets for the year ended December 31, 1999
were $109,872,183, having a weighted average yield of 9.57%, resulting in a net
interest margin of 6.20% for 1999.  This compared to average earning assets for
the year ended December 31, 1998 of $91,737,570, having a weighted average yield
of 9.59%, resulting in a net interest margin of 6.00% for 1998.  The increase in
net interest margin was attributable primarily to the decrease in the

                                      -41-
<PAGE>

Company's cost of funds from 4.41% for the year ended December 31, 1998 to 4.21%
for the year ended December 31, 1999.

Provision for Loan Losses

     The Company's non-performing assets totaled $1,156,627, or 0.88% of total
assets as of December 31, 1999, as compared to $789,841, or 0.73% of total
assets as of December 31, 1998.  The increase in non-performing assets from 1998
to 1999 was attributable primarily to an increase in CLC's loans that were
contractually past due ninety days or more.  Typically, consumer finance
companies may experience a higher ratio of past due loans than a banking
institution.  CLC's loan portfolio had grown from 2.60% of the Company's entire
loan portfolio at December 31, 1998 to 4.31% at December 31, 1999, therefore
management considered the increase in non-performing assets as a percentage of
total assets to be reasonable.  CLC's non-performing assets increased by 124.25%
as compared to a 99.49% increase in its loan portfolio during 1999.

     The Department, the Bank's primary regulatory authority, requires the Bank
to maintain a loan loss allowance of not less than one percent of all
outstanding loans.  This allowance is used to cover future loan losses.  During
1999, the Company sustained $349,898 in net loan losses as compared to $230,241
in net losses in 1998.  Although CLC's net loan losses increased to $243,199 as
of December 31, 1999, as compared to $77,757 as of December 31, 1998, management
considered the level of loan losses to be acceptable due to the 99.49% increase
in CLC's loan portfolio during 1999 and management's strengthened policy
regarding treatment of past due loans.  The Company's provision for loan losses
was $695,062 for the year ended December 31, 1999, as compared to $336,243 for
the year ended December 31, 1998.  The Company's loan loss allowance was
$1,356,649, or 1.51% of outstanding loans, as of December 31, 1999.

Noninterest Income

     Total noninterest income, consisting of service charges on deposits,
appraisal fees, credit life insurance commissions, securities gains, loss in
CashTrans and other miscellaneous income, increased approximately 17.56% to
$1,856,200 for the year ended December 31, 1999, as compared to total
noninterest income of $1,578,958 for the year ended December 31, 1998.  The
increase in noninterest income resulted primarily from (i) an increase of
$83,476 in insurance commissions collected which was primarily due to the growth
of CLC's customer base, (ii) an increase of $69,423 in the Bank's income derived
from service charges and fees which was primarily due to the growth of the
Bank's customer base, (iii) an increase of $66,346 in the Bank's collection of
mortgage origination fees related to its mortgage division which was formed in
1998, and (iv) a $49,765 decrease in the Company's equity in the loss of its
unconsolidated subsidiary, CashTrans.

Noninterest Expenses

     Noninterest expenses, consisting of salaries and employee benefits,
occupancy and other miscellaneous expenses, increased approximately 37.72% to
$6,866,150 for 1999, as compared to $4,985,623 for 1998.  This increase was
attributable primarily to a 39.96% increase in salaries and employee benefits
caused by the Company's need for additional human resources due to the growing
customer base of the Bank and CLC, as well as routine salary increases.
Additionally, pressures on

                                      -42-
<PAGE>

employment costs in the Company's primary market areas had caused some increase
in salaries and benefits in order to attract and retain key employees. Occupancy
expense increased by approximately $309,687, or 43.22%, for the year ended
December 31, 1999, as compared to the same period in 1998, primarily due to
increases in depreciation, rent, and telephone expense associated with the
Bank's addition of a full service branch in Cobb County and CLC's addition of
seven offices. Other operating expense increased by approximately $493,251, or
31.37%, for the year ended December 31, 1999, as compared to the same period in
1998, primarily due to increased expenses related to the expansion in the Bank
and CLC such as advertising, software costs, telephone expense, and consulting
fees.

Income Tax Expenses

     Total income tax expense for the year ended December 31, 1999 was $240,623
as compared to $505,295 for the year ended December 31, 1998.  The effective tax
rate decreased from 28.63% to 21.81% at December 31, 1999 as compared to
December 31, 1998.  This decrease was due primarily to the 21.45% increase in
tax-exempt interest income earned by the Bank while there was a 37.50% decrease
in the Company's earnings before income taxes.


Capital Resources and Liquidity

     Historically, the principal sources of funds for the Company have been
deposits, repayments of loans, other borrowings, and cash received from
maturities and sales of securities.  In 2000, the Company received $15,753,373
in net increases of demand, savings, and time deposits and $6,874,899 from
maturities and sales of securities. In 2000, the Bank also borrowed $5,000,000
from the Federal Home Loan Bank, which is collateralized by securities held in
the Bank's investment portfolio that were purchased with the funds.  Management
has chosen to employ this investment growth strategy in order to maximize the
Bank's earnings opportunities over the next five years, while maintaining a
conservative risk position.

     Uses of funds in 2000 included: $287,074 paid in dividends to Company
shareholders, $1,650,000 in the purchase of cash value life insurance policies,
and $1,547,003 in additions to premises and equipment.  The net change in the
Company's loans was an increase of $20,314,162 for 2000, and $10,327,028 in
securities were purchased in 2000.

     Increases in the Bank's core deposits are expected to be the major source
of funds provided during 2001.  Management believes that deposit growth will
continue at a moderate pace due to the Bank's expansion of its branch network
into Cobb County.  The Bank opened its second full-service branch in Cobb County
at Battle Ridge in early 2000.  Additionally, the Bank has an Internet branch
via its website, where new customers may open a deposit account with little
concern about geographic location.  The Bank has partnered with a vendor which
provides customers with a bill paying service and the ability to conduct funds
transfers via a secure Internet connection.  The Bank has implemented stringent
security measures in order to provide the ease of Internet banking while
maintaining safety measures deemed necessary by management.  The Bank also
subscribes to a service called QwickRate, which allows the Bank to publish its
rates on certificates of deposits over an electronic billboard that may attract
interested depositors throughout the U.S.  The Bank may

                                      -43-
<PAGE>

choose to seek deposits through this alternative source of funds if management
determines that the choice meets the Company's asset and liability strategies.
Management of the Bank sets the rates to be offered, which have been slightly
higher than the rates paid on core deposits. The Bank utilized this service,
selling $590,000 in these time deposits during the quarter ended December 31,
2000, with $5,105,045 outstanding in these time deposits for the year ended
December 31, 2000. Additionally, a product offered by the Bank allows certain
commercial customers the flexibility of employing funds that might otherwise
remain in deposit balances to invest in repurchase agreements so that the
customer may earn interest overnight. Securities sold under repurchase
agreements totaled $6,302,165 at December 31, 2000. Management is monitoring
core deposits and customer relationships in an effort to maintain overall
deposit growth. The Bank also borrowed $5,000,000 from the Federal Home Loan
Bank during 2000, which is collateralized by securities held in the Bank's
investment portfolio. Management has chosen to employ this investment growth
strategy in order to maximize the Bank's earnings opportunities over the next
five years, while maintaining a conservative risk position.

     The Company is subject to regulatory capital requirements imposed by the
Department and by the Board of Governors of the Federal Reserve System.  Under
federal law, the Company and the Bank are required to maintain a ratio of total
capital to risk weighted assets of at least 8.0%, of which at least one-half
must be so-called Tier 1 capital.  Under applicable federal regulations and
interpretations thereof, the Bank's ratio of total capital to risk weighted
assets at December 31, 2000, was 10.71%, and its ratio of Tier 1 capital to risk
weighted assets was 9.59%.  Under applicable federal regulations and
interpretations thereof, the Company's ratio of total capital to risk weighted
assets at December 31, 2000, was 13.60%, and its ratio of Tier 1 capital to risk
weighted assets was 12.35%.  Additionally, under federal law, all but the most
highly rated banks and bank holding companies are required to maintain a minimum
ratio of Tier 1 capital to total average assets (Tier 1 leverage ratio) of 4.0%
to 5.0%, including the most highly rated banks and bank holding companies that
are anticipating or experiencing significant growth.  Three percent is the
minimum Tier 1 leverage ratio required for the most highly rated banks and bank
holding companies with no plans to expand.  The Bank exceeds its Tier 1 leverage
ratio requirement with a Tier 1 leverage ratio of 7.44% as of December 31, 2000.
The Company also exceeds its Tier 1 leverage ratio requirement with a Tier 1
leverage ratio of 9.96% as of December 31, 2000.  Through its policy of
controlled growth, the Company intends to maintain capital in excess of the
required minimum in order to support future growth.

     Liquidity represents the Company's ability to meet both loan commitments
and deposit withdrawals.  Liquidity is monitored monthly by management in order
to ensure compliance with the Bank's policy of maintaining adequate liquidity.
The Bank relies primarily on deposit gathering in order to fund its lending and
investing activities.  In addition, the Company obtains funds from loan
principal repayments, proceeds from sales of loan participations and investment
securities, and other borrowings.  Loan repayments are a relatively stable
source of funds, while deposit inflows and outflows and sales of loan
participations and investment securities are significantly influenced by
prevailing interest rates, economic conditions and the Company's asset and
liability management strategies.  Borrowings may be used on a short-term basis
to compensate for reductions in the availability of other sources of funds or on
a longer term basis to support expanded lending activities and for other general
business purposes.

                                      -44-
<PAGE>

     The Bank maintains two lines of credit to borrow federal funds that total
$5,300,000 in order to enhance liquidity.  At December 31, 2000, the Bank had no
funds borrowed on either of these lines of credit.  The Bank is a member of the
Federal Home Loan Bank of Atlanta and borrowings are also available through that
relationship.  The amount of credit available from the Federal Home Loan Bank
fluctuates based on criteria set by that institution concerning the Bank's
portfolio of loans secured by housing for one to four families.  As of December
31, 2000, the Bank had $5,500,000 in borrowings outstanding under this facility,
and no additional borrowings are available based on the Bank's loan portfolio.
At December 31, 2000, the Bank had also borrowed $5,000,000 from the Federal
Home Loan Bank, which is collateralized by securities held in the Bank's
investment portfolio.  Management has chosen to employ this investment growth
strategy in order to maximize the Bank's earnings opportunities over the next
five years, while maintaining a conservative risk position.

     The Company has a $3,500,000 revolving credit facility with The Bankers
Bank, Atlanta, Georgia, which is intended to enhance the Company's liquidity.
As of December 31, 2000, the Company had $1,030,000 borrowed under this
facility.  Additionally, CLC established a $1,500,000 revolving credit facility
with The Bankers Bank in July 1999, which is intended to provide a source of
funds for the lending activities of that subsidiary.  As of December 31, 2000,
CLC had $715,921 in borrowed funds outstanding under this facility.  As of July
1999, the operations of CashTrans are funded principally through a $1,000,000
credit facility with The Bankers Bank.  As of December 31, 2000, CashTrans had
$1,000,000 in borrowed funds outstanding under this facility.  Under these
revolving credit facilities with The Bankers Bank, interest only is due and
payable on the first business day of each calendar quarter.  The Company's
credit facility (i) accrues interest at a floating rate equal to the "prime"
rate of interest as published from time to time in The Wall Street Journal minus
                                                   -----------------------
1%, and (ii) the principal shall be paid in ten annual installments beginning
July 2003.  CLC's and CashTrans' credit facilities (i) accrue interest at a
floating rate equal to the prime rate minus 0.75%, and (ii) are due in full on
July 1, 2002.  Amounts outstanding under the three credit facilities are
guaranteed by the Company and collateralized by the stock in the Bank.  CLC's
loan is also collateralized by its loan receivables.  CashTrans' loan is
personally guaranteed by James R. Henderson, the principal of JRH Diversified,
Inc.

Forward-Looking Statement

     Some of the foregoing statements are forward-looking statements which
reflect significant assumptions and subjective judgements believed by management
to be reasonable as of the date of this report.  They do not constitute a
forecast or prediction of actual results, and actual performance and financial
results may differ materially from those anticipated due to a variety of
factors, including but not limited to (i) increased competition with other
financial institutions, (ii) lack of sustained growth in the local economy,
(iii) rapid fluctuations in interest rates, and (iv) changes in the legislative
and regulatory environment.  The foregoing statements should not be construed as
exhaustive and the Company disclaims any obligation to subsequently update or
revise any forward-looking statements after the date of this report.

                                      -45-
<PAGE>

ITEM 7.   Financial Statements
------------------------------


              REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS





To the Board of Directors and Stockholders
Community Trust Financial Services Corporation

We have audited the accompanying consolidated balance sheets of Community Trust
Financial Services Corporation and subsidiaries as of December 31, 2000 and
1999, and the related consolidated statements of earnings, comprehensive income,
changes in stockholders' equity and cash flows for each of the three years in
the period ended December 31, 2000. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Community Trust
Financial Services Corporation and subsidiaries as of December 31, 2000 and
1999, and the results of their operations and their cash flows for each of the
three years in the period ended December 31, 2000, in conformity with generally
accepted accounting principles.

                                                     /s/Porter Keadle Moore, LLP


Atlanta, Georgia
February 2, 2001

                                     -46-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

                          Consolidated Balance Sheets

                          December 31, 2000 and 1999

                                    Assets
                                    ------

<TABLE>
<CAPTION>
                                                                            2000             1999
                                                                            ----             ----
<S>                                                                   <C>               <C>
Cash and due from banks, including reserve
   requirements of $665,000 and $678,000                              $   5,653,743        4,206,134
Federal funds sold                                                        2,010,000        4,590,000
                                                                      -------------     ------------
         Cash and cash equivalents                                        7,663,743        8,796,134

Securities available for sale                                            30,047,659       26,111,751
Other investments                                                         1,084,494        1,114,671
Loans, net                                                              107,643,851       88,256,999
Premises and equipment                                                    4,952,767        3,994,220
Intangible assets, net                                                      630,849          851,518
Accrued interest receivable and other assets                              4,525,587        2,617,501
                                                                      -------------     ------------

                                                                      $ 156,548,950      131,742,794
                                                                      -------------     ------------
                     Liabilities and Stockholders' Equity
                     ------------------------------------
Deposits:
   Demand                                                             $  14,316,455       13,604,854
   Interest-bearing demand                                               19,637,347       18,832,836
   Savings                                                               15,182,532       14,906,486
   Time                                                                  45,946,370       36,983,824
   Time, in excess of $100,000                                           25,082,933       20,084,264
                                                                      -------------     ------------

         Total deposits                                                 120,165,637      104,412,264

Securities sold under repurchase agreements                               6,302,165        4,880,864
Accrued interest payable and other liabilities                            1,939,903        1,396,262
Other borrowings                                                         12,245,921        6,290,000
                                                                      -------------     ------------

         Total liabilities                                              140,653,626      116,979,390
                                                                      -------------     ------------
Commitments

Stockholders' equity:
   Common stock, par value $2.50, authorized 10,000,000
      shares, issued and outstanding 2,398,169 and 2,383,550 shares       5,995,422        5,958,875
   Additional paid-in capital                                             3,885,322        3,852,477
   Retained earnings                                                      5,920,170        5,136,852
   Accumulated other comprehensive income (loss), net of tax                 94,410         (184,800)
                                                                      -------------     ------------

         Total stockholders' equity                                      15,895,324       14,763,404
                                                                      -------------     ------------

                                                                      $ 156,548,950      131,742,794
                                                                      -------------     ------------
</TABLE>

See accompanying notes to consolidated financial statements.

                                     -47-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

                      Consolidated Statements of Earnings

             For the Years Ended December 31, 2000, 1999 and 1998

<TABLE>
<CAPTION>
                                                                         2000            1999             1998
                                                                         ----            ----             ----
<S>                                                                 <C>              <C>             <C>
Interest income:
   Interest and fees on loans                                       $ 11,177,185       9,008,346       7,266,861
   Interest on federal funds sold                                        249,573         191,178         243,472
   Interest and dividends on investment securities:
     U.S. Treasuries                                                       5,667         103,512         266,019
     U.S. Government agencies and mortgage backed                      1,257,937         775,169         671,141
     State, county and municipal                                         367,420         359,484         311,313
     Other                                                               137,007          73,129          38,366
                                                                    ------------     -----------     -----------

              Total interest income                                   13,194,789      10,510,818       8,797,172
                                                                    ------------     -----------     -----------
Interest expense:
   Interest on deposits:
     Demand                                                              448,118         391,107         408,200
     Savings                                                             349,132         346,946         371,969
     Time                                                              2,503,260       1,514,435       1,312,184
     Time in excess of $100,000                                        1,402,127       1,035,576         932,577
  Other interest                                                         924,007         414,581         264,143
                                                                    ------------     -----------     -----------

              Total interest expense                                   5,626,644       3,702,645       3,289,073
                                                                    ------------     -----------     -----------

              Net interest income                                      7,568,145       6,808,173       5,508,099

Provision for loan losses                                                591,010         695,062         336,243
                                                                    ------------     -----------     -----------

              Net interest income after provision for loan losses      6,977,135       6,113,111       5,171,856
                                                                    ------------     -----------     -----------

Noninterest income:
   Service charges on deposit accounts                                 1,036,532       1,009,684         940,261
   Appraisal fees                                                        139,498         179,087         157,737
   Insurance commissions                                                 555,177         375,315         291,839
   Mortgage banking income                                               250,755         144,708          78,362
   Gain (loss) on sales of securities available for sale                     -               -            46,499
   Equity in loss of unconsolidated subsidiary                          (148,662)        (14,849)        (64,614)
   Miscellaneous                                                         499,003         162,255         128,874
                                                                    ------------     -----------     -----------

              Total noninterest income                                 2,332,303       1,856,200       1,578,958
                                                                    ------------     -----------     -----------

Noninterest expense:
   Salaries and employee benefits                                      4,564,983       3,774,337       2,696,748
   Occupancy                                                           1,315,316       1,026,180         716,493
   Other operating                                                     1,988,637       2,065,633       1,572,382
                                                                    ------------     -----------     -----------

              Total noninterest expense                                7,868,936       6,866,150       4,985,623
                                                                    ------------     -----------     -----------

              Earnings before income taxes                             1,440,502       1,103,161       1,765,191

Income taxes                                                             370,110         240,623         505,295
                                                                    ------------     -----------     -----------
              Net earnings                                          $  1,070,392         862,538       1,259,896
                                                                    ============     ===========     ===========
Basic earnings per share                                            $       0.45            0.37            0.65
                                                                    ============     ===========     ===========
Diluted earnings per share                                          $       0.43            0.35            0.63
                                                                    ============     ===========     ===========
</TABLE>

See accompanying notes to consolidated financial statements.

                                     -48-

<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION


                Consolidated Statements of Comprehensive Income

             For the Years Ended December 31, 2000, 1999 and 1998

<TABLE>
<CAPTION>
                                                                         2000          1999           1998
                                                                         ----          ----           ----
<S>                                                                   <C>            <C>           <C>
Net earnings                                                          $1,070,392      862,538      1,259,896
                                                                      ----------     --------      ---------
Other comprehensive income, net of tax:
   Unrealized gain (loss) on securities available for sale               450,099     (792,829)       308,015
   Income tax effect on gain (loss)                                      170,889     (300,958)       117,046
                                                                      ----------     --------      ---------
Unrealized gain (loss) arising during the year, net of tax               279,210     (491,871)       190,969
                                                                      ----------     --------      ---------

   Less:  Reclassification adjustment for gain (loss)
         included in net earnings                                              -            -         46,499
    Income tax effect on reclassification adjustments                          -            -         17,670
                                                                      ----------     --------      ---------
Reclassification adjustment for gain (loss)
     included in net earnings, net of tax                                      -            -         28,829
                                                                      ----------     --------      ---------
Other comprehensive income                                               279,210     (491,871)       162,140
                                                                      ----------     --------      ---------

Comprehensive income                                                  $1,349,602      370,667      1,422,036
                                                                      ----------     --------      ---------
</TABLE>

See accompanying notes to consolidated financial statements.

                                     -49-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

          Consolidated Statements of Changes in Stockholders' Equity

             For the Years Ended December 31, 2000, 1999 and 1998


<TABLE>
<CAPTION>
                                                                                                        Accumulated
                                                                                                           Other
                                                                           Additional                  Comprehensive
                                                    Common Stock            Paid-In       Retained     Income (Loss),
                                                --------------------
                                                Shares        Amount        Capital       Earnings      Net of Tax       Total
                                                ------        ------        -------       --------      ----------       -----
<S>                                            <C>         <C>             <C>            <C>           <C>             <C>
Balance, December 31, 1997                     1,682,648   $ 4,206,620         6,292      3,511,989        144,931      7,869,832

Net earnings                                           -             -             -      1,259,896              -      1,259,896

Cash dividends declared ($0.12 per share)              -             -             -       (210,502)             -       (210,502)

Net proceeds from issuance of common stock       588,236     1,470,590     3,351,072              -              -      4,821,662

Exercise of stock options, net of                 25,272        63,180         4,995              -              -         68,175
repurchases

Change in accumulated other comprehensive
   income (loss), net of tax                           -             -             -              -        162,140        162,140
                                               ---------   -----------     ---------     ----------      ---------    -----------

Balance, December 31, 1998                     2,296,156     5,740,390     3,362,359      4,561,383        307,071     13,971,203


Net earnings                                           -             -             -        862,538              -        862,538

Cash dividends declared ($0.12 per share)              -             -             -       (287,069)             -       (287,069)

Issuance of common stock to acquire assets        81,660       204,150       489,960              -              -        694,110

Exercise of stock options, net of                  5,734        14,335        (7,227)             -              -          7,108
repurchases

Tax benefit of nonqualified stock options              -             -         7,385              -              -          7,385

Change in accumulated other comprehensive
   income (loss), net of tax                           -             -             -              -       (491,871)      (491,871)
                                               ---------   -----------     ---------     ----------      ---------    -----------

Balance, December 31, 1999                     2,383,550     5,958,875     3,852,477      5,136,852       (184,800)    14,763,404

Net earnings                                           -             -             -      1,070,392              -      1,070,392

Cash dividends declared ($0.12 per share)              -             -             -       (287,074)             -       (287,074)

Exercise of stock options, net of                 14,619        36,547           116              -              -         36,663
repurchases

Tax benefit of nonqualified stock options              -             -        32,729              -              -         32,729

Change in accumulated other comprehensive
   income (loss), net of tax                           -             -             -              -        279,210        279,210
                                               ---------   -----------     ---------     ----------      ---------    -----------
Balance, December 31, 2000                     2,398,169   $ 5,995,422     3,885,322      5,920,170         94,410     15,895,324
                                               =========   ===========     =========      =========         ======     ==========
</TABLE>

See accompanying notes to consolidated financial statements.

                                     -50-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

                     Consolidated Statements of Cash Flows

             For the Years Ended December 31, 2000, 1999 and 1998

<TABLE>
<CAPTION>
                                                                             2000             1999           1998
                                                                             ----             ----           ----
<S>                                                                    <C>              <C>             <C>
Cash flows from operating activities:
Net earnings                                                           $  1,070,392         862,538       1,259,896
   Adjustments to reconcile net earnings to net cash provided
     by operating activities, net of effect of acquisitions:
       Depreciation, amortization and accretion                             685,581         540,838         413,461
       Provision for loan losses                                            591,010         695,062         336,243
       Provision for deferred income taxes                                 (243,324)       (192,413)        (19,182)
       Equity in loss of unconsolidated subsidiary                          148,662          14,849          64,614
       Gain on sales of securities available for sale                             -               -         (46,499)
       Gain on sales of other investments                                  (154,813)              -               -
       Loss (gain) on sale of other real estate                               7,633          (8,772)        (22,797)
       Loss (gain) on sale of fixed assets                                  (15,663)          6,579               -
       Gain on sale of loans                                                (63,365)              -               -
       Change in:
         Interest receivable                                               (320,381)          1,598        (188,792)
         Other assets                                                      (216,362)        (91,187)       (324,119)
         Cash surrender value of life insurance                            (103,063)         (3,682)              -
         Interest payable                                                   404,685         102,850          83,321
         Other liabilities                                                  171,685         150,255        (186,627)
                                                                       ------------    ------------    ------------
              Net cash provided by operating activities                   1,962,677       2,078,515       1,369,519
                                                                       ------------    ------------    ------------
Cash flows from investing activities, net of effect of acquisitions:
   Proceeds from sales of securities available for sale                           -               -       5,451,852
   Proceeds from calls and maturities of securities
     available for sale                                                   6,874,899       5,585,083       6,025,432
   Purchases of securities available for sale                           (10,327,028)    (11,024,640)     (9,609,839)
   Purchases of other investments                                          (210,500)       (195,271)       (618,300)
   Proceeds from sale of other investments                                  395,490               -               -
   Purchase of cash value life insurance policies                        (1,650,000)       (500,000)              -
   Acquisition of assets                                                          -        (821,919)              -
   Proceeds from sale of loans and related goodwill                         551,444               -               -
   Net increase in loans                                                (20,314,162)    (14,712,242)    (17,702,926)
   Purchases of premises and equipment                                   (1,547,003)     (1,951,648)       (381,161)
   Construction in process                                                        -        (211,728)              -
   Improvements to other real estate                                              -               -         (54,101)
   Proceeds from sale of other real estate                                  184,353          83,030         250,530
   Proceeds from sales of premises and equipment                             67,255           2,245               -
                                                                       ------------    ------------    ------------
              Net cash used by investing activities                     (25,975,252)    (23,747,090)    (16,638,513)
                                                                       ------------    ------------    ------------
Cash flows from financing activities:
   Net change in deposits                                                15,753,373      17,505,735       4,925,426
   Net change in securities sold under repurchase agreements              1,421,301       4,880,864               -
   Net proceeds from FHLB advances                                        5,000,000               -       5,500,000
   Net change in other borrowings                                           955,921         790,000        (800,000)
   Net proceeds from issuance of common stock                                     -               -       4,821,662
   Proceeds from exercise of stock options, net of repurchases               36,663           7,108          68,175
   Cash dividends paid                                                     (287,074)       (287,069)       (210,502)
                                                                       ------------    ------------    ------------
              Net cash provided by financing activities                  22,880,184      22,896,638      14,304,761
                                                                       ------------    ------------    ------------
Net change in cash and cash equivalents                                  (1,132,391)      1,228,063        (964,233)
Cash and cash equivalents at beginning of year                            8,796,134       7,568,071       8,532,304
                                                                       ------------    ------------    ------------
Cash and cash equivalents at end of year                               $  7,663,743       8,796,134       7,568,071
                                                                       ============    ============    ============
</TABLE>

                                     -51-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

                     Consolidated Statements of Cash Flows

             For the Years Ended December 31, 2000, 1999 and 1998

<TABLE>
<CAPTION>
                                                                           2000           1999          1998
                                                                           ----           ----          ----
<S>                                                                     <C>             <C>           <C>
Supplemental disclosures of cash flow information:
   Cash paid during the year for:
        Interest                                                        $5,221,959      3,599,795     3,205,752
        Income taxes                                                    $  362,500        430,000       542,000
    Noncash investing and financing activities:
      Change in accumulated other comprehensive income
            (loss), net of tax                                          $  279,210       (491,871)      162,140
      Transfers of loans to other real estate                           $        -        238,495       221,381
      Stock issued to acquire assets                                    $        -        694,110             -
      Tax benefit of nonqualified stock options                         $   32,729          7,385             -
</TABLE>

See accompanying notes to consolidated financial statements.

                                     -52-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

                  Notes to Consolidated Financial Statements

(1)  Summary of Significant Accounting Policies

     Basis of Presentation and Reclassification
     ------------------------------------------
     The consolidated financial statements include the accounts of Community
     Trust Financial Services Corporation (the "Company"), its wholly-owned
     subsidiaries, Community Trust Bank (the "Bank"), Metroplex Appraisals, Inc.
     ("Metroplex"), and Community Loan Company ("CLC"). On December 31, 1998,
     the Company purchased the 25% minority interest in CLC for $8,574. All
     significant intercompany accounts and transactions have been eliminated in
     consolidation. Certain 1999 and 1998 amounts have been reclassified to
     conform to the 2000 presentation.

     The Company's business is primarily conducted by its subsidiaries. The
     Company is subject to regulation under the Bank Holding Company Act of
     1956.

     The Bank commenced business in 1988 upon receipt of its banking charter
     from the State of Georgia Department of Banking and Finance (the "DBF").
     The Bank is primarily regulated by the DBF and the Federal Deposit
     Insurance Corporation and undergoes periodic examinations by these
     regulatory agencies. The Bank provides a full range of commercial and
     consumer banking services in Paulding and Cobb counties in Georgia.

     Metroplex was formed in 1992 as an appraisal service company. CLC was
     incorporated in 1995 for the purpose of acquiring and operating existing
     consumer finance companies under the direction of the Company. The
     operations of CLC, located in the Georgia cities of Rockmart, Rossville,
     Gainesville, Woodstock, Cartersville, Dahlonega, Dalton and Rome, are
     funded principally through a line of credit arrangement with another
     financial institution.

     In May 1997, the Company entered into a joint venture to establish a
     nonbank subsidiary, Cash Transactions, L.L.C. ("CashTrans"), that sells,
     leases, and services automated teller machines. The Company owns 49% of the
     equity of CashTrans through an initial capital contribution of $49,000.
     Additionally, the Company and the Bank have loans to CashTrans totaling
     approximately $504,000 and $635,000 at December 31, 2000 and 1999,
     respectively. The joint venture is accounted for using the equity method of
     accounting.

     The accounting principles followed by the Company and its subsidiaries, and
     the methods of applying these principles, conform with generally accepted
     accounting principles ("GAAP") and with general practices within the
     banking industry. In preparing financial statements in accordance with
     GAAP, management is required to make estimates and assumptions that affect
     the reported amounts in the financial statements. Actual results could
     differ significantly from those estimates. Material estimates common to the
     banking industry that are particularly susceptible to significant change in
     an operating cycle of one year include, but are not limited to, the
     determination of the allowance for loan losses, the valuation of any real
     estate acquired in connection with foreclosures or in satisfaction of
     loans, and valuation allowances associated with the realization of deferred
     tax assets which are based on future taxable income.

     Cash and Cash Equivalents
     -------------------------
     For purposes of reporting cash flows, cash and cash equivalents include
     cash and due from banks and federal funds sold.

     Investment Securities
     ---------------------
     The Company classifies its securities in one of three categories: trading,
     available for sale, or held to maturity. At December 31, 2000 and 1999, the
     Company has classified all securities as available for sale.

     Securities available for sale consist of all investment securities not
     classified as trading securities or securities held to maturity and are
     recorded at fair value. Unrealized holding gains and losses, net of the
     related tax effect, on securities available for sale are excluded from
     earnings and are reported as a separate component of stockholders' equity
     until realized.

     A decline in the market value of any available for sale investment below
     cost that is deemed other than temporary is charged to earnings and
     establishes a new cost basis for the security.

                                     -53-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(1)  Summary of Significant Accounting Policies, continued

     Investment Securities, continued
     ---------------------
     Premiums and discounts are amortized or accreted over the life of the
     related security as an adjustment to the yield. Realized gains and losses
     for securities classified as available for sale are included in earnings
     and are derived using the specific identification method for determining
     the cost of securities sold.

     Other Investments
     -----------------
     Other investments include Federal Home Loan Bank ("FHLB") stock and other
     equity securities with no readily determinable fair value. These investment
     securities are carried at cost.

     Loans, Loan Fees and Allowance for Loan Losses
     ----------------------------------------------
     Loans that management has the intent and ability to hold for the
     foreseeable future or until maturity are reported at the principal amount
     outstanding, net of unearned interest and the allowance for loan losses.
     Interest on substantially all loans is calculated by using the simple
     interest method on the daily balance of the principal amount outstanding.
     Loan fees, net of certain origination costs, are deferred and are being
     amortized over the lives of the respective loans.

     A loan is considered impaired when, based on current information and
     events, it is probable that all amounts due according to the contractual
     terms of the loan agreement will not be collected. Impaired loans are
     measured based on the present value of expected future cash flows,
     discounted at the loan's effective interest rate, or at the loan's
     observable market price, or at the fair value of the collateral of the loan
     if the loan is collateral dependent. Interest income from impaired loans is
     recognized using the cash basis method of accounting.

     As a result of management's ongoing review of the loan portfolio, loans are
     placed on nonaccrual status generally when they are greater than 90 days
     past due. Exceptions are allowed for loans greater than 90 days past due
     when such loans are well collateralized and in process of collection.

     The Bank's provision for loan losses is based upon management's continuing
     review and evaluation of the loan portfolio and is intended to create an
     allowance adequate to absorb losses on loans outstanding as of the end of
     each reporting period. For individually significant loans, management's
     review consists of evaluations of the financial strength of the borrowers
     and the related collateral. The review of groups of loans, which are
     individually insignificant, is based upon delinquency status of the group,
     lending policies and collection experience. This review is supplemented by
     an independent external loan review performed on an annual basis at the
     Bank.

     Management believes that the allowance for loan losses is adequate. While
     management uses 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 allowance for loan
     losses. Such agencies may require the Bank and CLC to recognize additions
     to the allowance based on their judgments of information available to them
     at the time of their examination.

     Premises and Equipment
     ----------------------
     Premises and equipment are stated at cost less accumulated depreciation.
     Depreciation is computed using the straight-line method over the estimated
     useful lives of the assets. When assets are retired or otherwise disposed
     of, the cost and related accumulated depreciation are removed from the
     accounts, and any gain or loss is reflected in income for the period. The
     cost of maintenance and repairs is charged to expense as incurred, whereas
     significant renewals and improvements are capitalized. The range of
     estimated useful lives for premises and equipment are:

               Buildings and improvements          20 - 31 years
               Furniture and equipment              3 - 10 years

     Intangible Assets
     -----------------
     Intangible assets, arising from the excess of cost over the fair value of
     net assets acquired, is amortized on a straight-line basis over periods not
     exceeding 15 years. On an ongoing basis, management reviews the valuation
     and amortization periods of goodwill to determine if events and
     circumstances require the remaining lives to be reduced.

                                     -54-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(1)  Summary of Significant Accounting Policies, continued

     Securities Sold Under Repurchase Agreements
     -------------------------------------------
     Repurchase agreements are treated as financing activities, and are carried
     at the amounts at which the securities will be repurchased as specified in
     the respective agreements.

     Income Taxes
     ------------
     Deferred tax assets and liabilities are recorded for the future tax
     consequences attributable to differences between the financial statement
     carrying amounts of existing assets and liabilities and their respective
     tax bases. Deferred tax assets and liabilities are measured using enacted
     tax rates expected to apply to taxable income in the years in which the
     assets and liabilities are expected to be recovered or settled. The effect
     on deferred tax assets and liabilities of a change in tax rates is
     recognized in income tax expense in the period that includes the enactment
     date.

     In the event the future tax consequences of differences between the
     financial reporting bases and the tax bases of the Company's assets and
     liabilities results in deferred tax assets, an evaluation of the
     probability of being able to realize the future benefits indicated by such
     asset is required. A valuation allowance is provided for a portion of the
     deferred tax asset when it is more likely than not that some portion or all
     of the deferred tax asset will not be realized. In assessing the
     realizability of the deferred tax assets, management considers the
     scheduled reversals of deferred tax liabilities, projected future taxable
     income and tax planning strategies.

     Mortgage Banking Income
     -----------------------
     The Company earns commissions from third party investors who fund
     residential mortgage loans for which the Company performs certain loan
     origination services. Accordingly, the loans are not funded or recorded by
     the Company and the commissions are recorded as they are earned as mortgage
     banking income.

     Net 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 reconciliation of the amounts used in the computation of both
     "basic earnings per share" and "diluted earnings per share" for the years
     ended December 31, 2000, 1999 and 1998 are as follows:

<TABLE>
<CAPTION>
                                                                               Net              Common          Per Share
         For the Year Ended December 31, 2000                                Earnings           Shares           Amount
                                                                             --------           ------           ------
<S>                                                                       <C>                  <C>              <C>
         Basic earnings per share                                         $ 1,070,392          2,385,361        $  0.45
                                                                                                                =======

         Effect of dilutive securities:
         Stock options                                                              -             86,870
                                                                          -----------          ---------
         Diluted earnings per share                                       $ 1,070,392          2,472,231        $  0.43
                                                                          ===========          =========        =======

                                                                               Net              Common          Per Share
         For the Year Ended December 31, 1999                                Earnings           Shares           Amount
                                                                             --------           ------           ------

         Basic earnings per share                                         $   862,538          2,345,338        $  0.37
                                                                                                                =======
         Effect of dilutive securities:
         Stock options                                                              -             91,630
                                                                          -----------          ---------

         Diluted earnings per share                                       $   862,538          2,436,968        $  0.35
                                                                          ===========          =========        =======
</TABLE>

                                     -55-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(1)  Summary of Significant Accounting Policies, continued
     Net Earnings Per Share, continued
     ---------------------------------

<TABLE>
<CAPTION>
                                                                   Net              Common          Per Share
        For the Year Ended December 31, 1998                     Earnings           Shares           Amount
                                                                 --------           ------           ------
<S>                                                            <C>                <C>               <C>
        Basic earnings per share                               $ 1,259,896        1,926,696          $ 0.65

        Effect of dilutive securities:
        Stock options                                                    -           79,912
                                                               -----------        ---------
        Diluted earnings per share                             $ 1,259,896        2,006,608          $ 0.63
                                                               ===========        =========          ======
</TABLE>

     In December 1999, the Company declared a 2 for 1 stock split. All
     previously reported share and per share amounts have been restated to
     reflect the stock split.

     Recent Accounting Pronouncements
     --------------------------------
     In 1998, the Financial Accounting Standards Board issued Statement of
     Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative
     Instruments and Hedging Activities." SFAS No. 133 establishes accounting
     and reporting standards for hedging derivatives and for derivative
     instruments including derivative instruments embedded in other contracts.
     It requires the fair value recognition of derivatives as assets or
     liabilities in the financial statements. The Company was required to adopt
     SFAS No. 133 effective January 1, 2001. The adoption of SFAS No. 133 had no
     material impact on its financial position, results of operations or
     liquidity.

(2)  Acquisitions
     In June, 1999, the Company acquired the assets of five existing consumer
     finance companies. The purchase price of approximately $1,516,000 was
     settled with 81,660 restricted shares of the Company's common stock and
     approximately $822,000 in cash. The original purchase price was allocated
     to the assets based on their fair values at the date of acquisition with
     approximately $544,000 recorded as goodwill, to be amortized over 15 years.

(3)  Investment Securities
     Securities available for sale at December 31, 2000 and 1999 are summarized
     as follows:

<TABLE>
<CAPTION>
                                                                                        December 31, 2000
                                                                  -----------------------------------------------------------
                                                                                       Gross         Gross         Estimated
                                                                       Amortized    Unrealized    Unrealized          Fair
                                                                          Cost        Gains         Losses           Value
                                                                          ----        -----         ------           -----
<S>                                                               <C>               <C>           <C>             <C>
        U. S. Government agencies                                 $   15,545,645      77,457        45,018        15,578,084
        Mortgage-backed securities                                     4,067,357       2,926        35,451         4,034,832
        State, county and municipal                                    8,498,574     164,434        15,151         8,647,857
        Corporate bonds                                                  983,908       2,978                         986,886
        Equity securities                                                800,000           -             -           800,000
                                                                  --------------     -------       -------        ----------

                    Total                                         $   29,895,484     247,795        95,620        30,047,659
                                                                  ==============     =======       =======        ==========
<CAPTION>
                                                                                        December 31, 1999
                                                                  -----------------------------------------------------------
                                                                                      Gross         Gross         Estimated
                                                                     Amortized      Unrealized    Unrealized        Fair
                                                                       Cost           Gains         Losses          Value
                                                                       ----           -----         ------          -----
<S>                                                               <C>               <C>           <C>            <C>
        U. S. Treasuries                                          $      500,040       1,678          -             501,718
        U. S. Government agencies                                     15,702,594       1,030       184,771       15,518,853
        Mortgage-backed securities                                     2,536,514       1,502        71,927        2,466,089
        State, county and municipal                                    7,670,527      53,037        98,473        7,625,091
                                                                  --------------     -------       -------       ----------
                    Total                                         $   26,409,675      57,247       355,171       26,111,751
                                                                  ==============     =======       =======       ==========
</TABLE>

                                     -56-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(3)  Investment Securities, continued

     The amortized cost and estimated fair value of securities available for
     sale at December 31, 2000, by contractual maturity, are shown below.
     Expected maturities will differ from contractual maturities because
     borrowers have the right to call or prepay certain obligations with or
     without call or prepayment penalties.

<TABLE>
<CAPTION>
                                                                 Amortized       Estimated
                                                                   Cost         Fair Value
                                                              --------------   -----------
<S>                                                           <C>              <C>
     Due within one year                                      $  3,159,560       3,154,812
     Due from one to five years                                 11,005,273      11,046,114
     Due from five to ten years                                  8,786,383       8,874,862
     Due after ten years                                         2,076,911       2,137,039
     Mortgage-backed securities                                  4,067,357       4,034,832
     Equity securities                                             800,000         800,000
                                                              ------------     -----------

                                                              $ 29,895,484      30,047,659
                                                              ============     ===========
</TABLE>

     Proceeds from sales of securities available for sale during 1998 were
     $5,451,852, which included gross gains of $46,499. There were no sales of
     securities available for sale during 2000 and 1999.

     Investment securities with a carrying value of approximately $21,613,000
     and $19,028,000 as of December 31, 2000 and 1999, respectively, were
     pledged to secure public deposits as required by law or for other purposes.
     As of December 31, 2000, investment securities with a carrying value of
     approximately $6,003,000 were pledged to secure advances from the FHLB.

(4)  Loans

     Major classifications of loans at December 31, 2000 and 1999 are
     summarized as follows:

<TABLE>
<CAPTION>
                                                                          2000            1999
                                                                          ----            ----
<S>                                                                  <C>               <C>
       Commercial, financial and agricultural                        $  16,806,673      11,166,660
       Real estate - construction                                       22,726,261      16,576,411
       Real estate - mortgage                                           58,245,232      49,358,441
       Consumer                                                         11,543,621      12,512,136
                                                                     -------------     -----------

            Total loans                                                109,321,787      89,613,648

       Less allowance for loan losses                                    1,677,936       1,356,649
                                                                     -------------     -----------

            Loans, net                                               $ 107,643,851      88,256,999
                                                                     =============     ===========
</TABLE>

     The Bank grants loans and extensions of credit to individuals and a variety
     of firms and corporations located in its trade area, primarily Paulding and
     Cobb Counties, Georgia. Although the Bank has a diversified loan portfolio,
     a substantial portion of the loan portfolio is collateralized by improved
     and unimproved real estate and is dependent upon the real estate market.

     Changes in the allowance for loan losses are summarized as follows:

<TABLE>
<CAPTION>
                                                                       2000          1999          1998
                                                                       ----          ----          ----
<S>                                                                <C>             <C>           <C>
       Balance at beginning of year                                $ 1,356,649       935,234       829,232
       Amounts charged off                                            (322,148)     (413,312)     (268,151)
       Recoveries on amounts previously charged off                     67,417        63,414        37,910
       Provision charged to operating expenses                         591,010       695,062       336,243
       Allowance for loan losses acquired (sold)                       (14,992)       76,251             -
                                                                   -----------     ---------     ---------

       Balance at end of year                                      $ 1,677,936     1,356,649       935,234
                                                                   ===========     =========     =========
</TABLE>

                                     -57-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued


(5)  Premises and Equipment

     Premises and equipment at December 31, 2000 and 1999 are summarized as
     follows:

<TABLE>
<CAPTION>
                                                                   2000          1999
                                                                ---------      --------
<S>                                                            <C>             <C>
       Land                                                    $ 1,200,037     1,133,537
       Land improvements                                           104,459        96,360
       Buildings and improvements                                3,436,040     2,161,102
       Furniture and equipment                                   2,803,324     2,649,111
                                                                ----------     ---------

                                                                 7,543,860     6,040,110
       Less accumulated depreciation                             2,591,093     2,257,618
                                                                ----------     ---------

                                                                 4,952,767     3,782,492

       Construction in progress                                          -       211,728
                                                                ----------     ---------

                                                                $4,952,767     3,994,220
                                                                ==========     =========
</TABLE>

     Depreciation expense was approximately $537,000, $416,000 and $283,000 for
     the years ended December 31, 2000, 1999 and 1998, respectively.

(6)  Time Deposits

     At December 31, 2000, the scheduled maturities of time deposits are as
     follows:

              2001                           $ 57,066,383
              2002                              9,855,596
              2003                              1,778,488
              2004                              1,516,096
              2005                                812,740
                                             ------------

                                             $ 71,029,303
                                             ============

(7)  Other Borrowings

     In June 1999, the Company obtained a $3,500,000 line of credit with another
     financial institution. The debt was collateralized by 100% of the stock of
     the Bank and calls for interest to be paid quarterly at the prime rate less
     100 basis points. The loan agreement contained covenants relating to the
     level of the allowance for loan losses, payments of dividends, regulatory
     capital adequacy and return on average assets. At December 31, 2000, the
     Company has $1,030,000 outstanding under this line of credit, and
     management believes they are in compliance with all required covenants.

     The Bank has advances from the FHLB with monthly interest payments at
     various maturity dates and interest rates ranging from 5.51% to 6.49% at
     December 31, 2000. The FHLB advances are collateralized by a blanket
     assignment on all residential first mortgage loans and certain investment
     securities.

     Advances from the FHLB outstanding at December 31, 2000 mature as
     follows:

         Year
         ----
         2003                      $ 5,000,000
         2008                        5,500,000
                                   -----------

                                   $10,500,000
                                   ===========

                                     -58-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(7)  Other Borrowings, continued

     CLC has a $1,500,000 one year revolving line of credit with another
     financial institution. The loan agreement calls for interest to be paid
     quarterly at the prime rate less 75 basis points. The debt is
     collateralized by a first lien on its loans receivable. The line of credit
     is guaranteed by the Company and is further collateralized by 100% of the
     stock of the Bank. CLC has $715,921 outstanding at December 31, 2000 under
     this line of credit.

(8)  Commitments

     CashTrans has a $1,000,000 one year revolving line of credit with another
     financial institution which is guaranteed by the Company. At December 31,
     2000, CashTrans has $1,000,000 outstanding under this line of credit.

     The Company leases certain facilities under noncancellable operating lease
     arrangements. Future minimum lease payments required for all operating
     leases having a remaining term in excess of one year at December 31, 2000
     are as follows:

                  2001                      $ 135,000
                  2002                        119,000
                  2003                        102,000
                  2004                         89,000
                  2005                         90,000
                  Thereafter                  254,000
                                            ---------

                                            $ 789,000
                                            =========

     Rental expense for each of the three years in the period ended December 31,
     2000 totaled approximately $217,000, $164,000 and $116,000, respectively.

     The Bank is a party to financial instruments with off-balance-sheet risk in
     the normal course of business to meet the financing needs of its customers.
     These financial instruments include commitments to extend credit, standby
     letters of credit and financial guarantees. Those instruments involve, to
     varying degrees, elements of credit risk in excess of the amount recognized
     in the balance sheet. The contract amounts of those instruments reflect the
     extent of involvement the Bank has in particular classes of financial
     instruments.

     The Bank's exposure to credit loss in the event of nonperformance by the
     other party for commitments to extend credit, standby letters of credit and
     financial guarantees written is represented by the contractual amount of
     those instruments. The Bank uses the same credit policies in making
     commitments and conditional obligations as it does for on-balance-sheet
     instruments.

     In most cases, the Bank requires collateral to support financial
     instruments with credit risk.

<TABLE>
<CAPTION>
                                                                                  Approximate
                                                                                Contract  Amount
                                                                                ----------------
                                                                               2000            1999
                                                                               ----            ----
<S>                                                                       <C>               <C>
            Financial instruments whose contract
               amounts represent credit risk:
                  Commitments to extend credit                            $  27,135,000     21,905,000
                Standby letters of credit and
                   financial guarantees written                           $     982,000      1,110,000
</TABLE>

                                     -59-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(8)  Commitments, continued

     Commitments to extend credit are agreements to lend to a customer as long
     as there is no violation of any condition established in the contract.
     Commitments generally have fixed expiration dates or other termination
     clauses and may require payment of a fee. Since many of the commitments may
     expire without being drawn upon, the total commitment amounts do not
     necessarily represent future cash requirements. The Bank evaluates each
     customer's creditworthiness on a case-by-case basis. The amount of
     collateral obtained, if deemed necessary by the Bank, upon extension of
     credit is based on management's credit evaluation. Collateral held varies
     but may include unimproved and improved real estate, certificates of
     deposit or personal property.

     Standby letters of credit and financial guarantees written are conditional
     commitments issued by the Bank to guarantee the performance of a customer
     to a third party. The credit risk involved in issuing letters of credit is
     essentially the same as that involved in extending loan facilities to
     customers. The Bank holds real estate and assignments of deposit accounts
     as collateral supporting those commitments for which collateral is deemed
     necessary.

(9)  Stockholders' Equity

     In August 1998, the Company completed a public offering of 588,236 shares
     of common stock at a price of $8.50 per share. The net proceeds of this
     offering of $4,821,662 (after deducting issuance costs of $178,344) were
     used to repay indebtedness of the Company, contribute capital to the Bank,
     and fund loans to the non-bank subsidiaries.

     On December 14, 1999, the Board of Directors of the Company declared a 2
     for 1 stock split to be effected in the form of a 100% stock dividend to be
     distributed on January 28, 2000 to holders of record on January 18, 2000.
     All share and per share amounts have been changed to reflect the stock
     split as if it had occurred on December 31, 1997.

     On February 15, 2000, the Board of Directors of the Company approved the
     Community Trust Financial Services Corporation Dividend Reinvestment and
     Stock Purchase Plan. The Plan provides for the full or partial reinvestment
     of cash dividends and optional cash purchases of the Company's stock. A
     total of 400,000 shares were reserved for possible issuance and sale under
     the Plan.

(10) Regulatory Matters

     Dividends paid by the Bank are the primary source of funds available to the
     Company. Banking regulations limit the amount of dividends that may be paid
     without prior approval of the regulatory authorities. These restrictions
     for the Bank are based on the level of regulatory classified assets, prior
     year's earnings, and the ratio of equity capital to total assets. The Bank
     may declare dividends of approximately $728,000 during 2001 without prior
     regulatory approval.

     The Company and the Bank are subject to various regulatory capital
     requirements administered by the federal banking agencies. Failure to meet
     minimum capital requirements can initiate certain mandatory, and possibly
     additional discretionary, actions by regulators that, if undertaken, could
     have a direct material effect on the financial statements. Under capital
     adequacy guidelines and the regulatory framework for prompt corrective
     action, specific capital guidelines that involve quantitative measures of
     the assets, liabilities and certain off-balance-sheet items as calculated
     under regulatory accounting practices must be met. The capital amounts and
     classification are also subject to qualitative judgments by the regulators
     about components, risk weightings and other factors.

     Quantitative measures established by regulation to ensure capital adequacy
     require the Company and the Bank to maintain minimum amounts and ratios of
     total and Tier 1 capital to risk-weighted assets and of Tier 1 capital to
     average assets (all as defined). Management believes, as of December 31,
     2000, the Company and the Bank meet all capital adequacy requirements to
     which they are subject.

                                     -60-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(10) Regulatory Matters, continued

     As of December 31, 2000, the most recent notification from Federal Deposit
     Insurance Corporation categorized the Bank as well capitalized under the
     regulatory framework for prompt corrective action. To be categorized as
     well capitalized the Bank must maintain minimum total risk-based, Tier 1
     risk-based and Tier 1 leverage ratios as set forth in the table. The
     Company's and the Bank's actual capital amounts and ratios are also
     presented below.

<TABLE>
<CAPTION>
                                                                                                          To Be Well
                                                                                                      Capitalized Under
                                                                              For Capital             Prompt Corrective
                                                     Actual                Adequacy Purposes          Action Provisions
                                                -------------------       ------------------        -------------------
                                                Amount        Ratio       Amount       Ratio        Amount        Ratio
                                                ------        -----       ------       -----        ------        -----
<S>                                            <C>            <C>         <C>          <C>          <C>           <C>
As of December 31, 2000:
Total Capital (to Risk Weighted Assets)
   Consolidated                                $16,711,000      13.6%     $9,830,000     8.0%        N/A           N/A
   Bank                                        $12,552,000      10.7%     $9,373,000     8.0%       $11,716,000    10.0%
Tier 1 Capital (to Risk Weighted Assets)
   Consolidated                                $15,170,000      12.4%     $4,915,000     4.0%        N/A           N/A
   Bank                                        $11,240,000       9.6%     $4,686,000     4.0%        $7,030,000     6.0%
Tier 1 Capital (to Average Assets)
   Consolidated                                $15,170,000      10.0%     $5,793,000     4.0%        N/A           N/A
   Bank                                        $11,240,000       7.4%     $5,593,000     4.0%        $6,992,000     5.0%
As of December 31, 1999:
Total Capital (to Risk Weighted Assets)
   Consolidated                                $15,343,000      15.4%     $7,966,000     8.0%        N/A           N/A
   Bank                                        $11,538,000      12.1%     $7,633,000     8.0%        $9,541,000    10.0%
Tier 1 Capital (to Risk Weighted Assets)
   Consolidated                                $14,097,000      14.2%     $3,983,000     4.0%        N/A           N/A
   Bank                                        $10,388,000      10.9%     $3,816,000     4.0%        $5,725,000     6.0%
Tier 1 Capital (to Average Assets)
   Consolidated                                $14,097,000      11.0%     $5,125,000     4.0%        N/A           N/A
   Bank                                        $10,388,000       8.1%     $5,109,000     4.0%        $6,386,000     5.0%
</TABLE>

(11) Employee and Director Benefit Programs

     The Company has an employee stock option plan and a director stock option
     plan. The plans were adopted for the benefit of directors and key officers
     and employees in order that they may purchase Company stock at a price
     equal to the fair market value on the date of grant. A total of 600,000
     shares were reserved for possible issuance under these plans. The options
     vest over a three year period and expire after ten years.

     Both plans are accounted for under Accounting Principles Board Opinion No.
     25 and related interpretations. No compensation expense has been recognized
     related to these plans. Had compensation cost been determined based upon
     the fair value of the options at the grant dates, the Company's net
     earnings and net earnings per share would have been reduced to the proforma
     amounts indicated below.

<TABLE>
<CAPTION>
                                                                        2000          1999          1998
                                                                        ----          ----          ----
<S>                                            <C>                  <C>              <C>         <C>
        Net earnings                           As reported          $ 1,070,392      862,538     1,259,896
                                               Proforma             $ 1,041,148      697,066     1,098,626

        Basic earnings per share               As reported          $      0.45         0.37          0.65
                                               Proforma             $      0.44         0.30          0.57

        Diluted earnings per share             As reported          $      0.43         0.35          0.63
                                               Proforma             $      0.42         0.29          0.55
</TABLE>

                                     -61-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(11) Employee and Director Benefit Programs, continued

     The fair value of each option is estimated on the date of grant using the
     minimum value options-pricing model with the following weighted average
     assumptions used for grants in 2000, 1999 and 1998, respectively: dividend
     yield of 1%, 1% and 2%, respectively, risk free interest rate of 5%, 7% and
     5%, respectively, and an expected life of 10 years. The weighted average
     grant-date fair value of options granted in 2000, 1999 and 1998 was $2.57,
     $3.56 and $4.45, respectively. For disclosure purposes, the Company
     immediately recognized the expense associated with the option grants
     assuming that all awards will vest.

     A summary of activity in these stock option plans is presented below:

<TABLE>
<CAPTION>
                                                  2000                      1999                     1998
                                          --------------------   -----------------------    ---------------------
                                                     Weighted                  Weighted                  Weighted
                                                      Average                  Averaged                  Average
                                                      Option                    Option                    Option
                                          Option       Price       Option        Price      Option        Price
                                          Shares     Per Share     Shares      Per Share    Shares      Per Share
                                          ------     ---------     ------      ---------   -------      ---------
<S>                                       <C>        <C>          <C>          <C>         <C>          <C>
     Outstanding, beginning of year        360,934     $ 6.87       294,340      $ 6.15    206,888        $ 4.43
     Granted during the year                25,937     $ 9.25        81,040      $ 9.25    122,000        $ 8.48
     Cancelled during the year              (5,050)    $ 9.00        (5,020)     $ 7.97     (6,668)       $ 6.23
     Exercised during the year             (21,080)    $ 4.57        (9,426)     $ 4.43    (27,880)       $ 3.54
                                          --------                  -------                -------

     Outstanding, end of year              360,741     $ 7.13       360,934      $ 6.87    294,340        $ 6.15
                                          ========                  =======                =======

     Number of shares exercisable          252,546                  201,674                149,582
                                          ========                  =======                =======
</TABLE>

        A summary of options outstanding as of December 31, 2000 is presented
below:

<TABLE>
<CAPTION>
                                                                                                               Weighted
                                                   Weighted                                                 Average Option
                                Range of            Average                                Options        Price Per Share of
            Options             Price Per        Option Price           Years             Currently       Options Currently
          Outstanding             Share            Per Share          Remaining          Exercisable         Exercisable
          -----------             -----            ---------          ---------          -----------         -----------
<S>                            <C>               <C>                  <C>                <C>              <C>
             83,972            $ 2.89-3.94          $ 3.31                3                 83,972              $ 3.31
             62,152            $ 5.00-7.89          $ 6.34                6                 62,152              $ 6.34
            214,617            $ 8.50-9.25          $ 8.86                8                106,422              $ 8.72
            -------              ---------            ----                -                -------              ------

            360,741            $ 2.89-9.25          $ 7.13                7                252,546              $ 6.34
            =======              =========            ====                =                =======              ======
</TABLE>

     The Company also had an incentive stock option plan which expired on April
     18, 1998. The remaining 696 shares outstanding under this plan were
     exercised at $5.00 per share during 1998.

     The Company has a 401(k) profit sharing plan which is available to
     substantially all employees subject to certain service requirements. The
     Company's contribution is at the discretion of the Board of Directors and
     cannot exceed 6% of the employee's compensation. The contribution by the
     Company for 2000, 1999 and 1998 was approximately $55,000, $58,000 and
     $41,000, respectively.

                                     -62-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(11) Employee and Director Benefit Programs, continued

     During 1999, the Company initiated a postretirement benefit plan to provide
     retirement benefits to its Board of Directors or their designated
     beneficiaries. Under the plan, the Company agrees to pay annual benefits
     for a period of five years commencing upon the director's retirement or the
     attainment of age 65, whichever event is the last to occur. The cumulative
     deferred contributions for the directors in the plan totaled approximately
     $64,000 at December 31, 2000, and is included in other liabilities.
     Contributions to the plan for 2000 were approximately $64,000. The
     estimated amounts to be paid under the plan are to be funded by life
     insurance contracts purchased on the lives of certain directors. At
     December 31, 2000 and 1999, the cash surrender value of the insurance
     contracts was approximately $528,000 and $504,000, respectively, and is
     included in the consolidated balance sheet as a component of other assets.

     During 2000, the Company began sponsoring a postretirement benefit plan to
     provide retirement benefits to certain key officers and to provide death
     benefits for their designated beneficiaries. Under the plan, the Company
     purchased life insurance contracts on the lives of key officers. The
     increase in cash surrender value of the contracts, less the Company's cost
     of funds, constitutes the Company's contribution to the plan each year. In
     the event the insurance contracts fail to produce positive returns, the
     Company has no obligation to contribute to the plan. At December 31, 2000,
     the cash surrender value of the insurance contracts was approximately
     $1,729,000 and is included in the consolidated balance sheet as a component
     of other assets. Expenses incurred for benefits relating to this plan were
     approximately $46,000.

     Effective January 1, 2000, the Company implemented a deferred compensation
     plan for key management employees and directors. Under such plan, employees
     designated by the Board of Directors as well as participating directors may
     defer compensation and receive the deferred amounts upon termination of
     employment. All contributions to the plan will be held in a trust
     established by the Company and invested in mutual funds and/or shares of
     Company's common stock. All assets held by the trust are considered assets
     of the Company until paid to the participants. There were no contributions
     made to the plan by the Company during 2000.

(12) Income Taxes

     The components of income tax expense for the years ended December 31,
     2000, 1999 and 1998 are as follows:

<TABLE>
<CAPTION>
                                                                    2000         1999        1998
                                                                    ----         ----        ----
<S>                                                             <C>            <C>          <C>
     Current                                                    $  613,434      433,036     524,477
     Deferred                                                     (243,324)    (192,413)    (19,182)
                                                                ----------      -------     -------

                                                                $  370,110      240,623     505,295
                                                                ==========      =======     =======
</TABLE>

     The differences between the provision for income taxes and the amount
     computed by applying the statutory federal income tax rate to earnings
     before income taxes are as follows:

<TABLE>
<CAPTION>
                                                                   2000           1999          1998
                                                                   ----           ----          ----
<S>                                                             <C>             <C>           <C>
     Pretax income at statutory rates                           $  489,771        375,075       600,165
     Add (deduct):
     Tax-exempt interest income                                   (128,751)      (136,751)     (112,657)
     Non-deductible interest expense                                21,358         18,807        13,528
     State taxes, net of federal effect                            (11,467)         1,102         4,517
     Cash surrender value life insurance                           (35,041)             -             -
     Other                                                          34,240        (17,610)         (258)
                                                                ----------      ---------     ---------

                                                                $  370,110        240,623       505,295
                                                                ==========      =========     =========
</TABLE>

                                     -63-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(12) Income Taxes, continued

     The following summarizes the sources and expected tax consequences of
     future taxable deductions (income) which comprise the net deferred tax
     asset which is included as a component of other assets.

<TABLE>
<CAPTION>
                                                                                2000          1999
                                                                                ----          ----
<S>                                                                        <C>              <C>
     Deferred tax assets:
     Allowance for loan losses                                             $  442,972       380,131
     Unrealized loss on securities available for sale                               -       113,124
     Goodwill amortization                                                     29,929        28,181
     Deferred compensation                                                     41,791             -
     Nonbank bad debt reserve                                                 139,199        68,625
     Other                                                                     45,569         9,071
                                                                           ----------      --------

            Gross deferred tax assets                                         699,460       599,132
                                                                           ----------      --------

     Deferred tax liabilities:
     Premises and equipment                                                   (50,062)      (50,062)
     Unrealized gain on securities available for sale                         (57,765)            -
     Other                                                                          -       (29,872)
                                                                           ----------      --------

            Gross deferred tax liabilities                                   (107,827)      (79,934)
                                                                           ----------      --------

            Net deferred tax asset                                         $  591,633       519,198
                                                                           ==========      ========
</TABLE>

(13) Related Party Transactions

     The Company conducts transactions with directors and executive officers
     (including companies in which they have beneficial interest) as well as its
     unconsolidated subsidiary in the normal course of business. It is the
     policy of the Company that loan transactions with directors, executive
     officers and subsidiaries be made on substantially the same terms as those
     prevailing at the time for comparable loans to other persons. The following
     is a summary of activity for related party loans for 2000:

     Beginning balance                  $  1,844,000
     Loans advanced                          867,000
     Repayments                           (1,183,000)
                                        ------------

     Ending balance                     $  1,528,000
                                        ============

     The aggregate amount of deposits of directors and executive officers and
     their affiliates amounted to approximately $1,569,000 and $2,589,000 at
     December 31, 2000 and 1999, respectively.

(14) Supplemental Financial Data

     Components of other operating expenses in excess of 1% of total interest
     income and noninterest income for the years ended December 31, 2000, 1999
     and 1998 are as follows:

                                           2000           1999        1998
                                           ----           ----        ----

     Printing and supplies              $  138,788       123,851     112,554
     Data processing                    $  245,225       206,428     154,021
     Directors fees                     $  109,956        92,580     104,300
     Advertising                        $  139,993       232,421     107,283
     Telephone                          $  162,379       128,816      73,323

                                     -64-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(15) Community Trust Financial Services Corporation (Parent Company Only)
     Financial Information

                                Balance Sheets

                          December 31, 2000 and 1999

                                    Assets
                                    ------

<TABLE>
<CAPTION>
                                                                                 2000            1999
                                                                               --------         -------
<S>                                                                        <C>               <C>
       Cash                                                                $      89,360         201,913
       Investment in subsidiaries                                             15,153,583      14,117,441
       Fixed assets                                                            1,617,909         342,368
       Other assets                                                               93,610         203,600
                                                                           -------------     -----------

                                                                           $  16,954,462      14,865,322
                                                                           =============     ===========

                     Liabilities and Stockholders' Equity
                     ------------------------------------

       Other liabilities                                                   $      29,138         101,918
       Note payable                                                            1,030,000               -
       Stockholders' equity                                                   15,895,324      14,763,404
                                                                           -------------      ----------

                                                                           $  16,954,462      14,865,322
                                                                           =============      ==========

<CAPTION>
                            Statements of Earnings

             For the Years Ended December 31, 2000, 1999 and 1998

                                                                                   2000          1999            1998
                                                                                   ----          ----            ----
<S>                                                                        <C>                <C>             <C>
       Interest income                                                     $           -        59,074         222,042
       Dividends from subsidiaries                                               622,961       690,380         250,000
       Management fees                                                           296,769       252,830         193,673
       Other operating income                                                     18,222             -               -
       Interest expense                                                          (50,067)            -               -
       Other operating expenses                                                 (854,758)     (775,642)       (588,169)
                                                                           -------------     ---------       ---------

              Earnings before income tax benefit and equity
                in undistributed earnings of subsidiaries                         33,127       226,642          77,546

       Income tax benefit                                                        280,333       187,641          56,104
                                                                           -------------     ---------       ---------

              Earnings before equity in undistributed
                earnings of subsidiaries                                         313,460       414,283         133,650

       Equity in undistributed earnings of subsidiaries                          756,932       448,255       1,126,246
                                                                           -------------     ---------       ---------

              Net earnings                                                 $   1,070,392       862,538       1,259,896
                                                                           =============       =======       =========
</TABLE>

                                     -65-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(15) Community Trust Financial Services Corporation (Parent Company Only)
     Financial Information, continued

                           Statements of Cash Flows

             For the Years Ended December 31, 2000, 1999 and 1998

<TABLE>
<CAPTION>

                                                                                      2000            1999           1998
                                                                                      ----            ----           ----
<S>                                                                         <C>                     <C>           <C>
       Cash flows from operating activities
         Net earnings                                                       $      1,070,392         862,538      1,259,896
         Adjustments to reconcile net earnings to
            net cash provided by operating activities:
              Equity in undistributed earnings of subsidiaries                      (756,932)       (448,255)    (1,126,246)
              Depreciation                                                            51,206          14,323            994
              Other                                                                   69,939         219,752       (121,504)
                                                                                 -----------      ----------    -----------

                       Net cash provided by operating  activities                    434,605         648,358         13,140
                                                                                 -----------      ----------    -----------

       Cash flows from investing activities:

         Purchases of premises and equipment                                      (1,326,747)       (129,299)       (16,268)
          Construction in process                                                          -        (211,728)             -
         Capital contribution to the Bank                                                  -               -     (2,468,536)
          Capital contribution to CLC                                                      -      (2,500,000)
                                                                                                           -
         Investment in CLC                                                                 -               -         (8,574)
          Acquisition of assets on behalf of CLC                                           -        (821,919)             -
         Change in loans to subsidiaries                                                           2,743,850       (672,502)
                                                                                 -----------      ----------    -----------

                       Net cash used by investing activities                      (1,326,747)       (919,096)    (3,165,880)
                                                                                 -----------      ----------    -----------

       Cash flows from financing activities:

         Change in note payable                                                    1,030,000               -       (800,000)
         Cash dividends paid                                                        (287,074)       (287,069)      (210,502)
         Net proceeds from issuance of common stock                                        -               -      4,821,662
         Proceeds from exercise of stock options, net of repurchases                  36,663           7,108         68,175
                                                                                 -----------      ----------    -----------

                       Net cash provided (used) by financing activities              779,589        (279,961)     3,879,335
                                                                                 -----------      ----------    -----------

       Net change in cash                                                          (112,553)        (550,699)       726,595

       Cash at beginning of the year                                                 201,913         752,612         26,017
                                                                                 -----------      ----------    -----------

       Cash at end of the year                                                   $    89,360         201,913        752,612
                                                                                 ===========      ==========    ===========

       Noncash investing and financing activities:
         Change in accumulated other comprehensive
            income/loss, net of tax                                              $   279,210        (491,871)       162,140
          Tax benefit of nonqualified stock options, net of tax                  $    32,729           7,385              -
          Stock issued to acquire assets on behalf of CLC                        $         -         694,110              -
</TABLE>

                                     -66-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued


(16) Fair Value of Financial Instruments

     The Company is required to disclose fair value information about financial
     instruments, whether or not recognized on the face of the balance sheet,
     for which it is practicable to estimate that value. The assumptions used in
     the estimation of the fair value of the Company's financial instruments are
     detailed below. Where quoted prices are not available, fair values are
     based on estimates using discounted cash flows and other valuation
     techniques. The use of discounted cash flows can be significantly affected
     by the assumptions used, including the discount rate and estimates of
     future cash flows. The following disclosures should not be considered a
     surrogate of the liquidation value of the Company, but rather a good-faith
     estimate of the increase or decrease in the value of financial instruments
     held by the Company since purchase, origination or issuance.

          Cash and Cash Equivalents
          -------------------------
          For cash, due from banks and federal funds sold, the carrying amount
          is a reasonable estimate of fair value.

          Securities Available for Sale
          -----------------------------
          Fair values for securities available for sale are based on quoted
          market prices.

          Other Investments
          -----------------
          The carrying amount of other investments approximates fair value.

          Loans
          -----
          The fair value of fixed rate loans is estimated by discounting the
          future cash flows using the current rates at which similar loans would
          be made to borrowers with similar credit ratings. For variable rate
          loans, the carrying amount is a reasonable estimate of fair value.

          Cash Surrender Value of Life Insurance
          --------------------------------------
          Cash values of life insurance policies are carried at the value for
          which such policies may be redeemed for cash.

          Deposits and Securities Sold Under Repurchase Agreements
          --------------------------------------------------------
          The fair value of demand deposits, interest-bearing demand deposits,
          savings accounts and securities sold under repurchase agreements is
          the amount payable on demand at the reporting date. The fair value of
          fixed maturity certificates of deposit is estimated by discounting the
          future cash flows using the rates currently offered for deposits of
          similar remaining maturities.

          Other Borrowings
          ----------------
          The fair value of fixed rate borrowings are estimated using discounted
          cash flows, based on the current incremental borrowing rates for
          similar types of borrowing arrangements.

          Commitments to Extend Credit and Standby Letters of Credit
          ----------------------------------------------------------
          Because commitments to extend credit and standby letters of credit are
          made using variable rates and/or for relatively short commitment
          periods, the contract value is a reasonable estimate of fair value.

          Limitations
          -----------
          Fair value estimates are made at a specific point in time, based on
          relevant market information and information about the financial
          instrument. These estimates do not reflect any premium or discount
          that could result from offering for sale at one time the Company's
          entire holdings of a particular financial instrument. Because no
          market exists for a significant portion of the Company's financial
          instruments, fair value estimates are based on many judgments. These
          estimates are subjective in nature and involve uncertainties and
          matters of significant judgment and therefore cannot be determined
          with precision. Changes in assumptions could significantly affect the
          estimates.

                                     -67-
<PAGE>

                COMMUNITY TRUST FINANCIAL SERVICES CORPORATION

             Notes to Consolidated Financial Statements, continued

(16) Fair Value of Financial Instruments, continued

     Fair value estimates are based on existing on and off-balance sheet
     financial instruments without attempting to estimate the value of
     anticipated future business and the value of assets and liabilities that
     are not considered financial instruments. Significant assets and
     liabilities that are not considered financial instruments include deferred
     income taxes and premises and equipment. In addition, the tax ramifications
     related to the realization of the unrealized gains and losses can have a
     significant effect on fair value estimates and have not been considered in
     the estimates.

     The carrying amount and estimated fair values of the Company's financial
     instruments as of December 31, 2000 and 1999 are as follows:

<TABLE>
<CAPTION>
                                                                 2000                               1999
                                                       --------------------------        ------------------------------
                                                       Carrying        Estimated         Carrying            Estimated
                                                        Amount         Fair Value         Amount             Fair Value
                                                        ------         ----------         ------             ----------
<S>                                                <C>                <C>               <C>                  <C>
     Assets:
     Cash and cash equivalents                     $    7,663,743       7,663,743        8,796,134             8,796,134
     Securities available for sale                 $   30,047,659      30,047,659       26,111,751            26,111,751
     Other investments                             $    1,084,494       1,084,494        1,114,571             1,114,571
     Loans, net                                    $  107,643,851     106,526,720       88,256,999            87,881,349
     Cash surrender value of life insurance        $    2,256,745       2,256,745          503,682               503,682

     Liabilities:
     Deposits and securities sold under
       repurchase agreements                       $  126,467,802     126,762,214      109,293,128           109,584,926
     Other borrowings                              $   12,245,921      11,977,878        6,290,000             5,946,286

     Unrecognized financial instruments:
     Commitments to extend credit                  $   27,135,000      27,135,000       21,905,000            21,905,000
     Standby letters of credit                     $      982,000         982,000        1,110,000             1,110,000
</TABLE>

(17) Subsequent Event

     On January 31, 2001, the Board of Directors of the Company signed a non-
     binding letter of intent to merge with GB&T Bancshares, Inc. ("GB&T"), a
     Gainesville, Georgia multi-bank holding company. The proposed merger
     provides for the conversion of each common share and share equivalent of
     the Company into .786 shares of GB&T stock. The proposed merger is subject
     to the execution of a definitive agreement by the Company and GB&T, the
     consent of various regulatory authorities and shareholder approval.

                                     -68-
<PAGE>

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
------------------------------------------------------------------------
FINANCIAL DISCLOSURE
--------------------

     Neither the Company nor the Bank had any change in accountants or
disagreements with accountants on accounting and financial disclosure during the
two most recent fiscal years or subsequently.


                                   PART III
                                   --------


ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
----------------------------------------------------------------------
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
-------------------------------------------------

Name, Age, and
Year First Elected
as Director or
Executive Officer      Business Experience
-----------------      -------------------

Ronnie L. Austin       Mr. Austin has served as a Director and the President and
(52) (1988)            Chief Executive Officer of the Company since the
                       organization of the Company in October 1988. He has
                       served as Chief Executive Officer of the Bank since
                       December 1986, and served as President of the Bank from
                       December 1986 until September 1999. Before assuming his
                       position as President and Chief Executive Officer of the
                       Bank in December 1986, Mr. Austin served as Executive
                       Vice President and Senior Loan Officer of the Peoples
                       Bank of Bartow County from 1985 to 1986, and as Vice
                       President and Senior Loan Officer of the First National
                       Bank of Paulding County from 1975 to 1985.

George J. Berry        Mr. Berry has served as a Director of the Company since
(63) (1997)            he was appointed by the Board of Directors in May 1997.
                       He has served as a Director of the Bank since he was
                       appointed by the Board of Directors in August 2000. Mr.
                       Berry has served as Senior Vice-President of Cousins
                       Properties Inc., a real estate development firm, since
                       April 1990. Mr. Berry has served as a Director of ASA
                       Holdings, Inc. since May 1998. Prior to April 1990, Mr.
                       Berry served as Commissioner of the Dept. of Industry,
                       Trade, and Tourism for the State of Georgia. He also
                       served as Chairman of the Metropolitan Atlanta Olympic
                       Games Authority from 1993 to 1996.

R. Alan Bullock        Mr. Bullock has served as a Director of the Company since
(47) (1988)            its organization in October 1988. He returned to service
                       as a Director of the Bank in August 2000, after serving
                       as a Bank Director from 1987

                                      -69-
<PAGE>

                       until September 1996. He served as Chairman of the Board
                       of the Company and the Bank from April 1991 to April
                       1992. Since 1985, Mr. Bullock has served as a senior
                       partner of Bullock, Terrell and Mannelly, a company based
                       in Atlanta, Georgia involved in industrial development,
                       real estate finance and marketing, and property
                       management.

Bobbie P. Cooper       Mrs. Cooper has served as a Director of the Company and
(61) (1988)            the Bank since 1988 and previously served as Chairman of
                       the Board of the Company and the Bank from April 1992 to
                       April 1993. She served as Secretary-Treasurer of the
                       Company from April 1997 until December 1997. Mrs. Cooper
                       was co-owner of Three C's Clothing in Dallas, Georgia
                       from 1964 until 1992. Since 1970 she has been co-owner of
                       Cooper Rentals, which owns and manages real estate.

Danny H. Drummond      Mr. Drummond has served as a Director of the Company
(64) (1999)            since he was appointed by the Board of Directors in June
                       1999. He has served as a Director of the Bank since he
                       was appointed by the Board of Directors in August 2000.
                       Mr. Drummond has served as President of Community Loan
                       Company since that company was organized in 1995, and he
                       has served on the Board of Community Loan Company since
                       1996. Mr. Drummond has served as a President of Drummond
                       Association, Inc., a company based in Rome, Georgia
                       involved in consumer finance and tax preparation
                       throughout northwest Georgia since 1981.

J. Calvin Earwood      Mr. Earwood has served as a Director of the Company and
(59) (1988)            the Bank since 1988 and as Chairman of the Board of the
                       Bank from April 1989 to April 1990. Mr. Earwood has been
                       owner and President of Sunbelt Fasteners, Inc. in Dallas,
                       Georgia since 1983. He also has served as Chairman of the
                       Board of Oglethorpe Power Corporation since March 1989
                       and as Vice Chairman of the Board of Oglethorpe Power
                       Corporation from March 1984 to March 1989 and as director
                       of Oglethorpe Power Corporation since 1981. Additionally,
                       he has served as director of Greystone Power Corporation
                       since 1977.

W. A. Foster III       Mr. Foster has served as a Director of the Company and
(56) (1988)            the Bank since 1988 and has served as Chairman of the
                       Board of the Company and the Bank since April 1994. He
                       previously served as Chairman of the Board of the Company
                       and the Bank from April 1990 to April 1991. Mr. Foster
                       served as District Attorney for the Tallapoosa Judicial
                       Circuit of the State of Georgia from 1978 until 1992.
                       Since 1992 he has served as a Judge of the Superior Court
                       for the Tallapoosa Circuit.

                                      -70-
<PAGE>

Tommie R. Graham, Jr.  Mr. Graham has served as a Director of the Company since
(43) (1988)            its organization in October 1988. He returned to service
                       as a Director of the Bank in August 2000, after serving
                       as a Bank Director from 1987 until September 1996. He
                       served as Secretary-Treasurer of the Company from October
                       1988 until April 1997. Mr. Graham has served as Manager
                       of Jeriel Supply, LC, a building products company since
                       February 1996. Prior to Mr. Graham's service at Jeriel,
                       he served as Secretary-Treasurer of Railroad Lumber
                       Company, Inc. since July 1991. Mr. Graham served as
                       Executive Vice President of the Bank from December 1986
                       to June 1991.

James R. Parker        Mr. Parker has served as a Director of the Company since
(52) (2000)            he was appointed by the Board of Directors in August
                       2000. He has served as a Director of the Bank since he
                       was appointed by the Board of Directors in June 1997. Mr.
                       Parker retired from SunTrust Bank in 1995, where he was
                       vice-president/lending. Mr. Parker was co-owner of FBR,
                       Inc. in Fayetteville, Georgia from 1995 until 2000. He
                       now serves in sales at Gloves, Inc. since 2000.

W. Wyman Pilcher III   Mr. Pilcher has served as a Director of the Company since
(52) (2000)            he was appointed by the Board of Directors in August
                       2000. He has served as a Director of the Bank since he
                       was appointed by the Board of Directors in January 1997.
                       Mr. Pilcher has been co-owner of Centennial Kitchens,
                       Inc. since 1992. Prior to his service with Centennial
                       Kitchens, Mr. Pilcher served in capacities such as
                       president of First National Bank of Cobb County from 1984
                       to 1990.

Angel J. Byrd          Ms. Byrd has served as Controller of the Company since
(45) (1991)            April 1996 and was elected as Secretary of the Company in
                       December 1997. Ms. Byrd also has served as Senior Vice
                       President of the Bank since April 1996 and she was Chief
                       Financial Officer of the Bank until April 1999. Prior to
                       1996, Ms. Byrd served as Vice President and Chief
                       Financial Officer of the Bank since December 1991. Prior
                       to December 1997, Ms. Byrd served as Assistant Secretary
                       of the Company.

     Messrs. Berry and Drummond were elected to a three-year term as a member of
the Board which term expires at the 2001shareholders annual meeting; Messrs.
Parker and Pilcher were appointed as members of the Board which term expires at
the 2001 shareholders annual meeting; Messrs. Earwood, Foster, and Graham were
elected to a three-year term as a member of the Board which term expires at the
2002 shareholders annual meeting: and Messrs. Austin and Bullock and Mrs. Cooper
were elected to a three-year term as a member of the Board which term expires at
the 2003 shareholders annual meeting. The term of office of Mr Austin and Ms
Byrd as officers of the Company expire at the next annual meeting of the Board
of Directors of the Company or until their earlier termination.

                                      -71-
<PAGE>

Section 16(a) Beneficial Ownership Reporting Compliance

     Two Directors of the Company failed to file on a timely basis a report
required by Section 16(a) of the Securities Exchange Act of 1934 during the most
recent fiscal year.  Mr. Foster and Mr. Earwood failed to file in a timely
manner one report each on Form 4.  Each report concerned one transaction.  Other
than as described here, to the Company's knowledge, based solely on review of
the copies of such reports furnished to the Company or written representations
that no other reports were required, each person who, at any time during the
year ended December 31, 2000, was a Director, Executive Officer, or beneficial
owner of more than ten percent of the Company's Common Stock filed, on a timely
basis, all reports required to be filed by them, during such year, pursuant to
Section 16(a) of the Securities Exchange Act of 1934.

ITEM 10.  EXECUTIVE COMPENSATION
--------------------------------

Cash Compensation
-----------------

     The following table sets forth, for the fiscal years ended December 31,
2000, 1999, and 1998, the compensation paid to, or accrued by the Company for,
the Company's Chief Executive Officer and Chief Financial Officer.  No other
executive officer of the Company received compensation for any such fiscal years
which exceeded $100,000.

                          Summary Compensation Table

<TABLE>
<CAPTION>
                                                          Long Term
                                                          Compensation
                             Annual Compensation           Awards
                             -------------------           ------
                                                          Number of
Name and                                                  Securities
Principal                                                 Underlying         All Other
Position                Year    Salary ($)    Bonus ($)   Options/(1)/(#)   Compensation/(2)(3)/($)
---------               ----    ----------    ---------   ---------------   -----------------------
<S>                     <C>     <C>           <C>         <C>               <C>
Ronnie L. Austin        2000      135,121      19,769          4,000                7,724
(Chief Executive        1999      131,794      18,312          6,998                5,240
Officer)                1998      119,028         -0-         16,000                5,431

Angel J. Byrd           2000       92,500      13,875          2,000                2,980
(Chief Financial        1999       85,000      11,538         10,768                2,916
Officer)                1998       75,000       3,840            -0-                2,250
</TABLE>

__________________________
   /(1)/  The number of securities underlying these options has been restated as
          a result of the stock split effected by the Company on January 18th,
          2000. The 1993 Stock Option Plan provides that any options outstanding
          at the time of such a split will be adjusted in order to maintain the
          optionee's position in that holding.
   /(2)/  Compensation in this column consists of the dollar value of insurance
          premiums paid on behalf of Mr. Austin and Ms. Byrd by the Company
          during the year with respect to life insurance policies, and the
          Company's contribution in matching funds to Mr. Austin's and Ms.
          Byrd's 401K. For Mr. Austin, the amounts paid were as follows: for
          2000, 1999, and 1998, matching funds to his 401K were 4,391, 3,380,
          and 3,571, respectively, and insurance premiums were 3,333, 1,860, and
          1,860, respectively. For Ms. Byrd, the amounts paid were as follows:
          for 2000, 1999, and 1998, matching funds to her 401K were 2,659,2,916,
          and 2,250, respectively, and insurance premiums paid in 2000 were 321.
   /(3)/  Other perquisites do not meet the Securities and Exchange Commissions'
          threshold for disclosure, which is the lesser of $50,000 or 10% of the
          total salary and bonus for any named executive.

                                      -72-
<PAGE>

     The following table sets forth information in regard to incentive stock
options granted to executive officers of the Company whose compensation exceeded
$100,000 in the last fiscal year.


                       Option Grants in Last Fiscal Year

<TABLE>
<CAPTION>
                                        % of Total
                       Number of        Options
                       Securities       Granted to  Exercise
                       Underlying       Employees   or Base
                       Options          in Fiscal   Price        Expiration
Name                   Granted/(1)/(#)  Year        ($/Sh)/(1)/  Date
----                   ---------------  ---------   -----------  --------
<S>                    <C>              <C>         <C>          <C>
Ronnie L. Austin         4,000/(2)/       8.70%      9.25         1/1/2010
Angel J. Byrd            2,000/(2)/       4.35%      9.25         1/1/2010
</TABLE>

____________________
/(1)/ The number of securities underlying these options and the exercise price
      per share of each option have been restated as a result of the stock split
      effected by the Company on January 18th, 2000. The 1993 Stock Option Plan
      provides that any options outstanding at the time of such a split will be
      adjusted in order to maintain the optionee's position in that holding.
/(2)/ Mr. Austin and Ms. Byrd were awarded options to acquire shares of Company
      Common Stock under the Company's 1993 Stock Option Plan. This option
      expires ten years from the date the option was granted and is exercisable
      in increments of 33% per year (cumulative), beginning after one full year
      from the date the option was granted. The 1993 Stock Option Plan specifies
      that all options have a reload feature which allows the optionee to pay
      for exercise of all or part of an option with shares of Common Stock in
      the Company. If an optionee chooses to pay for exercise in this manner, a
      reload option is granted (i) for the same number of shares as is exchanged
      in payment for the exercise of such option, (ii) as of the date of such
      payment, and (iii) subject to all the same terms and conditions as such
      option; provided, the option price for shares subject to the reload option
      shall be determined pursuant to the Plan's description of the fair market
      value of such shares on the date the reload option is granted. An optionee
      who pays for exercise of a reload option with shares of the Common Stock
      is entitled to a successive reload option. In no event shall the term of
      any reload option extend beyond the original term of the option with
      respect to which such reload option was granted.


          The following table sets forth information in regard to the exercise
of stock options, and the number and value of unexercised stock options, for the
last fiscal year in relationship to executive officers of the Company whose
compensation exceeded $100,000 in the last fiscal year.

                                      -73-
<PAGE>

   Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option
Values

<TABLE>
<CAPTION>
                                                        Number of           Value of
                                                        Securities Under-   Unexercised
                                                        lying Unexercised   In-the-Money
                                                        Options at Fiscal   Options at Fiscal
                                                        Year-End /(1)/ (#)  Year-end ($)
                      Shares
                      Acquired on        Value          Exercisable/        Exercisable/
Name                  Exercise/(1)/(#)   Realized($)    Unexercisable       Unexercisable
----                  ----------------   -----------    -------------       -------------
<S>                   <C>                <C>            <C>                 <C>
Ronnie L .Austin            -0-              -0-        21,820 / 4,380      22,115 / 1,275 /(2)/
Angel J. Byrd               -0-              -0-        17,200 / 4,740      49,413 / 2,550 /(2)/
</TABLE>

__________________________
   /(1)/  The number of securities underlying these options and the exercise
          price per share of each option have been restated as a result of the
          stock split effected by the Company on January 18th, 2000. The 1993
          Stock Option Plan provides that any options outstanding at the time of
          such a split will be adjusted in order to maintain the optionee's
          position in that holding.
   /(2)/  The value of in-the-money options at fiscal year-end is calculated by
          subtracting the aggregate exercise price of such options from the
          aggregate year-end market value of the securities underlying the
          options. The year-end market value is determined by calculating the
          average of the bid and ask price as set by market makers in the
          Company's stock as of December 31, 2000.


Compensation of Directors
-------------------------

     As compensation for serving as a Director of the Company, each Director
receives $1,000 each month and $100 for each committee meeting attended.  A
Director who is also an employee of the Company receives no fees for attendance
at meetings of the full Board or committees thereof.  A Director who is also an
employee of a subsidiary of the Company receives no fees for attendance at
meetings for committees related to that subsidiary.

     On January 1st of each year that a Director who is not an employee of the
Company or any of its subsidiaries serves as such, he or she will receive an
option under the Company's 1993 Directors Stock Option Plan to acquire 2,000
shares of Company Common Stock.  New non-employee Directors who join the Board
will also receive an option to acquire 2,000 shares on the date they join at an
option exercise price equal to the fair market value of the Company's stock on
the date of the grant.  Each option granted under the 1993 Directors Stock
Option Plan expires ten years from the date the option is granted and is
exercisable in increments of 33% per year (cumulative), beginning after one full
year from the date the option is granted.  Additionally, the Board may choose,
at its discretion, to grant options to non-employee Directors of subsidiaries
controlled by the Company.

     The Bank has adopted a non-tax qualified retirement plan for its charter
Directors who are not also employees.  This plan was developed to provide
retirement benefits for those persons who served as Directors in the early years
of the Bank's organization with no compensation at all until 1991.  In the case
of a Director's involuntary termination of service (other than for cause) or
voluntary termination of service in connection with a change in control, the
Director is entitled to a benefit payable at his or her normal retirement date
equal to the full benefit that he or she would have

                                      -74-
<PAGE>

received had he or she remained a Director and retired at the normal retirement
date. In the event of the Director's termination of service due to disability,
the Director may request to receive an immediate disability benefit, in lieu of
a retirement benefit, and such benefit will be payable beginning within 30 days
following the Director's request. In the event of a Director's death, that
person's beneficiary will receive a death benefit either in a lump sum
settlement or the Bank may choose to continue annual payments. Under the plan,
split-dollar whole life insurance contracts were purchased on the lives of
certain Directors. At December 31, 2000, the cash surrender value of the
insurance contracts was approximately $527,000. This retirement plan for charter
Directors has six participants, including Messrs. Bullock, Earwood, Foster,
Graham, and Helms, and Mrs. Cooper.


Employment Contracts - Termination of Employment and Change in Control
----------------------------------------------------------------------
Arrangements
------------

     On January 1, 1998, the Company entered into a five year employment
agreement with Ronnie Austin, the Company's President and Chief Executive
Officer (the "Agreement").  The Agreement was amended on June 15, 1999.  Under
the Agreement, Mr. Austin is employed as President and Chief Executive Officer
of the Company at a base salary, plus certain benefits, including all benefits
that are made available to other senior executives of the Company and its
subsidiaries.  The Agreement provides that the base salary will increase each
year by an amount equal to the increase in the Consumer Price Index for Atlanta,
Georgia, or by an amount as approved by the Board.  Under the Agreement, Mr.
Austin also is entitled to annual incentive compensation based upon the
Company's performance goals as approved by the Board each year.  The Agreement
also provides for the grant to Mr. Austin, on January 1 of each year during the
term of the Agreement, of an incentive stock option to acquire 2,000 shares of
the Company's common stock.  The Agreement contains provisions that restrict Mr.
Austin's ability to compete with the Company or solicit its employees for a
specified period following the termination of his employment.  The Agreement
provides that if (i) the Company terminates Mr. Austin's employment without
"cause," or (ii) Mr. Austin terminates his employment (a) within 30 days
following a "change in control" of the Company or the Bank or (b) following a
breach by the Company of the Agreement in any material respect, then Mr. Austin
is entitled to a lump sum severance payment in an amount equal to one year's
base salary as in effect on the date of Mr. Austin's termination.

     On July 1, 1999, CLC, a subsidiary of the Company, entered into a five year
employment agreement with Danny Drummond, a director of the Company (the
"Drummond Agreement").  Under the Drummond Agreement, Mr. Drummond is employed
as President of CLC at a base salary, plus certain benefits, including all
benefits that are made available to other senior executives of the CLC.  The
Drummond Agreement provides that the base salary will increase each year by an
amount equal to the increase in the Consumer Price Index for Atlanta, Georgia.
Under the Drummond Agreement, Mr. Drummond also is entitled to receive annual
incentive compensation based upon CLC's performance goals as approved by the CEO
of the Company each year.  The Drummond Agreement contains provisions that
restrict Mr. Drummond's ability to compete with CLC or solicit its employees for
a specified period following the termination of his employment.  The Drummond
Agreement provides that if (i) CLC terminates Mr. Drummond's employment without
"cause," or (ii) Mr. Drummond terminates his employment (a) within 30 days
following a "change in control" of the Company or CLC, or (b) following a breach
by CLC of the Drummond Agreement in any material

                                      -75-
<PAGE>

respect, then Mr. Drummond is entitled to a lump sum severance payment in an
amount equal to one year's base salary in effect on the date of Mr. Drummond's
termination.

     On January 3, 2000, the Company entered into a three year employment
agreement with Angel Byrd, the Company's Chief Financial Officer (the "Byrd
Agreement").  Under the Byrd Agreement, Ms. Byrd is employed as Chief Financial
Officer of the Company at a base salary, plus certain benefits, including all
benefits that are made available to other senior executives of the Company.  The
Byrd Agreement provides that the base salary will increase each year by an
amount as approved by the CEO.  Under the Byrd Agreement, Ms. Byrd also is
entitled to receive annual incentive compensation based upon the Company's
performance goals as approved by the Board each year.  The Byrd Agreement also
provides for the grant to Ms. Byrd, on January 1 of each year during the term of
the Byrd Agreement, of an incentive stock option to acquire 2,000 shares of the
Company's common stock.  The Byrd Agreement contains provisions that purport to
restrict Ms. Byrd's ability to compete with the Company or solicit its employees
for a specified period following the termination of her employment.  The Byrd
Agreement provides that if (i) the Company terminates Ms. Byrd's employment
without "cause," or (ii) Ms. Byrd terminates her employment (a) within 90 days
following a "change in control" of the Company or (b) following a breach by the
Company of the Byrd Agreement in any material respect, then Ms. Byrd is entitled
to a lump sum severance payment in an amount equal to one year's base salary in
effect on the date of Ms. Byrd's termination.


Retirement Plan
---------------

     The Bank has adopted a non-tax qualified retirement plan for its key
employees.  This plan was developed to provide retirement benefits for those
persons who are deemed key employees of the Bank.  In the case of an employee's
involuntary termination of service (other than for cause) or voluntary
termination of service in connection with a change in control, the employee is
entitled to a benefit payable at his or her normal retirement date equal to the
full benefit that he or she would have received had he or she remained an
employee and retired at the normal retirement date.  In the event of the
employee's termination of service due to disability, the employee may request to
receive an immediate disability benefit, in lieu of a retirement benefit, and
such benefit will be payable beginning within 30 days following the employee's
request.  In the event of an employee's death, that person's beneficiary will
receive a death benefit either in a lump sum settlement or the Bank may choose
to continue annual payments.  Under the plan, split-dollar whole life insurance
contracts were purchased on the lives of participating employees.  At December
31, 2000, the cash surrender value of the insurance contracts was approximately
$1,729,000.  This retirement plan for key employees has eight participants,
including Mr. Austin and Ms. Byrd.


Other
-----

     The Bank has a policy of offering loans to Directors, Executive Officers,
principal stockholders and their affiliates with terms and rates which are
commensurate with those offered to unaffiliated borrowers of similar financial
standing in connection with similar type loans.  Loans by

                                      -76-
<PAGE>

the Bank to affiliates of the Company or the Bank are made in the ordinary
course of business on the same terms, including collateral requirements, as
those of comparable loans made at the same time to unaffiliated borrowers and do
not involve more than the normal risk of collectibility or contain other
unfavorable features. All loans extended by the Bank to Directors, Executive
Officers, principal stockholders and their affiliates during the year ended
December 31, 2000 were made in accordance with the policy set forth above.



ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
------------------------------------------------------------------------


Security Ownership of Certain Beneficial Owners
-----------------------------------------------

The following table sets forth information as of February 28, 2001 regarding the
ownership of the Company's Common Stock by each person known to the Company to
be the beneficial owner of more than 5% of the Company's Common Stock and by all
of the Directors and Executive Officers of the Company as a group.

<TABLE>
<CAPTION>
                                        Amount and Nature
                                        of Beneficial
Name and Address of Beneficial Owner    Ownership/(1)/      Percent of Class
------------------------------------    --------------      ----------------
<S>                                     <C>                 <C>
Wayne Tibbitts/(2)/
477 Indian Lake Court
Hiram, Georgia                               126,007               5.24%

All Directors and Executive
Officers as a group
(11 persons)/(3)(4)/                         408,746              15.95%
</TABLE>

_________________________
/(1)/ The stock ownership information shown has been furnished to the Company by
      the named person and group. Beneficial ownership as reported in the table
      has been determined in accordance with Securities and Exchange Commission
      regulations and includes shares of the Company's Common Stock as to which
      a person possesses sole or shared voting and/or investment power and
      shares which may be acquired within 60 days upon the exercise of
      outstanding stock options. Except as otherwise referenced in Notes (2),
      (3), and (4) below, the named person and group have sole voting and
      investment power with regard to the shares shown as owned by them.
/(2)/ The shares shown include 8,227 shares which are owned by the stockholder's
      spouse, and 1,604 shares which are owned by the stockholder's spouse
      jointly with the spouse's brother.
/(3)/ The shares shown include 2,820 shares which are held by a Director jointly
      with his spouse, 10,222 shares which are owned by the spouses of four
      Directors, 10,208 shares which are beneficially owned by a Director due to
      his ownership in the corporation that holds the shares, 40 shares which
      are owned by another family member who resides in the household of a
      Director, and 1,000 shares which are held by two Directors as custodians
      for their children.
/(4)/ The shares shown include 17,200 shares which are subject to options held
      by an Executive Officer, and 140,276 shares which are subject to options
      held by ten Directors, which such Executive Officer and Directors have the
      right to acquire within 60 days from February 28, 2001.

                                      -77-
<PAGE>

The following table sets forth information as of February 28, 2001 regarding the
ownership of the Company's Common Stock by each Director or Executive Officer of
the Company.

<TABLE>
<CAPTION>
                           Amount and Nature
Name of Director           of Beneficial
Or Executive Officer       Ownership/(1)/        Percent of Class
--------------------       --------------        ----------------
<S>                        <C>                   <C>
Ronnie L. Austin              41,132 /(2)/             1.69%
George J. Berry               10,835 /(3)/             0.45%
R. Alan Bullock               46,187 /(4)/             1.90%
Bobbie P. Cooper              69,836 /(5)/             2.88%
Danny H. Drummond             12,510 /(6)/             0.52%
J. Calvin Earwood             73,275 /(7)/             3.02%
W. A. Foster III              91,979 /(8)/             3.80%
Tommie R. Graham, Jr.         23,252 /(9)/             0.96%
James R. Parker                7,650/(10)/             0.32%
W. Wyman Pilcher III          13,033/(11)/             0.54%
Angel J. Byrd                 19,057/(12)/             0.79%
</TABLE>


/(1)/  The stock ownership information shown has been furnished to the Company
       by the named persons. Beneficial ownership as reported in the table has
       been determined in accordance with Securities and Exchange Commission
       regulations and includes shares of the Company's Common Stock as to which
       a person possesses sole or shared voting and/or investment power and
       shares which may be acquired within 60 days upon the exercise of
       outstanding stock options. Except as otherwise referenced in Notes (2)
       through (12) below, the named persons have sole voting and investment
       power with regard to the shares shown as owned by them.
/(2)/  Shares shown include 1,850 shares owned by the named person's spouse, and
       21,820 shares beneficially owned through a right to acquire additional
       shares upon the exercise of outstanding stock options.
/(3)/  Shares shown include 5,980 shares beneficially owned by the named person
       through a right to acquire additional shares upon the exercise of
       outstanding stock options.
/(4)/  Shares shown include 604 shares held by the named person as custodian for
       his minor children, 2,820 shares held by the named person jointly with
       his spouse, and 21,980 shares beneficially owned by the named person
       through a right to acquire additional shares upon the exercise of
       outstanding stock options.
/(5)/  Shares shown include 6,256 shares held by the named person's spouse in a
       self-directed IRA, and 21,980 shares beneficially owned through a right
       to acquire additional shares upon the exercise of outstanding stock
       options.
/(6)/  Shares shown include 10,208 shares beneficially owned by the named person
       due to his ownership in the corporation that holds the shares, and 660
       shares beneficially owned through a right to acquire additional shares
       upon the exercise of outstanding stock options.
/(7)/  Shares shown include 488 shares owned by the named person's spouse, as to
       which he disclaims beneficial ownership, and 21,980 shares beneficially
       owned through a right to acquire additional shares upon the exercise of
       outstanding stock options.
/(8)/  Shares shown include 17,841 shares beneficially owned by the named person
       through a right to acquire additional shares upon the exercise of
       outstanding stock options.
/(9)/  Shares shown include 400 shares held jointly with the named person's
       spouse as custodian for their minor children, 40 shares held by a family
       member who resides in his household, and 21,980 shares beneficially owned
       through a right to acquire additional shares upon the exercise of
       outstanding stock options.
/(10)/ Shares shown include 1628 shares owned by the named person's spouse, and
       3,022 shares beneficially owned through a right to acquire additional
       shares upon the exercise of outstanding stock options.
/(11)/ Shares shown include 3,033 shares beneficially owned by the named person
       through a right to acquire additional shares upon the exercise of
       outstanding stock options.
/(12)/ Shares shown include 17,200 shares beneficially owned by the named person
       through a right to acquire additional shares upon the exercise of
       outstanding stock options.

                                      -78-
<PAGE>

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
--------------------------------------------------------

     The Bank has a policy of offering loans to Directors, Executive Officers,
principal stockholders and their affiliates with terms and rates which are
commensurate with those offered to unaffiliated borrowers of similar financial
standing in connection with similar type loans.  Loans by the Bank to affiliates
of the Company or the Bank are made in the ordinary course of business on the
same terms, including collateral requirements, as those of comparable loans made
at the same time to unaffiliated borrowers and do not involve more than the
normal risk of collectibility or contain other unfavorable features.  All loans
extended by the Bank to Directors, Executive Officers, principal stockholders
and their affiliates during the year ended December 31, 2000 were made in
accordance with the policy set forth above.

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K
------------------------------------------


     (a)  Exhibits.


     The following exhibits are filed as a part of, or incorporated by
reference, in this report:


Exhibit No.                            Description
-----------                            -----------

2.1+                Agreement and Plan of Reorganization, dated March 16, 2001,
                    by and between GB&T Bancshares, Inc. and Community Trust
                    Financial Services Corporation (the "Registrant").

3.1*                Articles of Incorporation of the Registrant. Amendment to
                    Articles of Incorporation of the Registrant (incorporated
                    herein by reference to Exhibit 3.1 of the Registrant's
                    Annual Report on Form 10-KSB for the fiscal year ended
                    December 31, 1999).

3.2*+               Bylaws of the Registrant

4                   Rights of the Registrant's security holders are defined in
                    the Registrant's Articles of Incorporation and Bylaws,
                    provided in Exhibits 3.1 and 3.2, respectively.

10.1*               1988 Stock Option Plan and related specimen copy of option
                    agreement.

10.2                1993 Employee Stock Option Plan, as amended (incorporated
                    herein by reference to Exhibit 10.2 of the Registrant's
                    Annual Report on Form 10-KSB for the fiscal year ended
                    December 31, 1999).

                                     -79-
<PAGE>

10.3           1993 Directors Stock Option Plan, as amended (incorporated herein
               by reference to Exhibit 10.3 of the Registrant's Annual Report on
               Form 10-KSB for the fiscal year ended December 31, 1999).

10.4           Lease, dated June 9, 1989, by and between First Baptist Church of
               Dallas, Georgia ("First Baptist") and the Community Trust Bank
               (the "Bank") relating to the lease of real property (incorporated
               herein by reference to Exhibit 10.5 of the Registrant's Annual
               Report on Form 10-K for the fiscal year ended December 31, 1992).

10.5           Lease Extension Agreement, dated 1996, by and between First
               Baptist and the Bank relating to certain real property referred
               to in Exhibit 10.4 hereof (incorporated herein by reference to
               Exhibit 10.8 of the Registrant's Annual Report on Form 10-KSB for
               the year ended December 31, 1996).

10.6           License and Equipment Purchase Agreement, dated July 27, 1991, by
               and between Bank South, National Association, and the Bank
               relating to the Paulding Commons Kroger branch (incorporated
               herein by reference to Exhibit 10.6 of the Registrant's Annual
               Report on Form 10-K for the fiscal year ended December 31, 1992).

10.7           Lease, dated May 25, 1995, by and between Brock Investments, Inc.
               of Hiram, Georgia and the Bank relating to the lease of real
               property (incorporated herein by reference to Exhibit 10.7 of the
               Registrant's Annual Report on Form 10-K for the fiscal year ended
               December 31, 1995).

10.8           Loan and Stock Pledge Agreement, dated November 14, 1998, by and
               between the Registrant and The Bankers Bank (incorporated herein
               by reference to Exhibit 2 of the Registrant's Current Report on
               Form 8-K, dated November 14, 1997).

10.9           Employment Agreement, dated January 1, 1998, by and between the
               Registrant and Ronnie Austin, as amended (incorporated herein by
               reference to Exhibit 10.10 of the Registrant's Annual Report on
               Form 10-KSB for the fiscal year ended December 31, 1999).

10.10          Employment Agreement, dated July 1, 1999, by and between
               Community Loan Company and Danny Drummond (incorporated herein by
               reference to Exhibit 10.11 of the Registrant's Quarterly Report
               on Form 10-QSB for the quarter ended September 30, 1999).

10.11          Executive Supplemental Retirement Plan - Executive Agreement,
               dated January 13, 2000, by and between the Bank and Ronnie Austin
               (incorporated herein by reference to Exhibit 10.12 of the
               Registrant's Annual Report on Form 10-KSB for the fiscal year
               ended December 31, 1999).

                                      -80-
<PAGE>

10.12          Life Insurance Endorsement Method Split Dollar Plan Agreement,
               dated January 13, 2000, by and between the Bank and Ronnie Austin
               (incorporated herein by reference to Exhibit 10.13 of the
               Registrant's Annual Report on Form 10-KSB for the fiscal year
               ended December 31, 1999).

10.13          Deferred Compensation Plan for Key Employees and Directors
               (incorporated herein by reference to Exhibit 10.14 of the
               Registrant's Annual Report on Form 10-KSB for the fiscal year
               ended December 31, 1999).

10.14          Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and R. Alan Bullock (incorporated
               herein by reference to Exhibit 10.15 of the Registrant's Annual
               Report on Form 10-KSB for the fiscal year ended December 31,
               1999).


10.15          Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and Bobbie P. Cooper (incorporated
               herein by reference to Exhibit 10.16 of the Registrant's Annual
               Report on Form 10-KSB for the fiscal year ended December 31,
               1999).

10.16          Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and J. Calvin Earwood (incorporated
               herein by reference to Exhibit 10.17 of the Registrant's Annual
               Report on Form 10-KSB for the fiscal year ended December 31,
               1999).

10.17          Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and William A. Foster, III
               (incorporated herein by reference to Exhibit 10.18 of the
               Registrant's Annual Report on Form 10-KSB for the fiscal year
               ended December 31, 1999).

10.18          Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and Tommie R. Graham, Jr.
               (incorporated herein by reference to Exhibit 10.19 of the
               Registrant's Annual Report on Form 10-KSB for the fiscal year
               ended December 31, 1999).

10.19          Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and John C. Helms (incorporated
               herein by reference to Exhibit 10.20 of the Registrant's Annual
               Report on Form 10-KSB for the fiscal year ended December 31,
               1999).

10.20          Life Insurance Endorsement Method Split Dollar Plan Agreement,
               dated January 13, 2000, by and between the Bank and Angel J. Byrd
               (incorporated herein by reference to Exhibit 10.21 of the
               Registrant's Quarterly Report on Form 10-QSB for the quarter
               ended March 31, 2000).

                                      -81-
<PAGE>

10.21          Executive Supplemental Retirement Plan - Executive Agreement,
               dated January 13, 2000, by and between the Bank and Angel J. Byrd
               (incorporated herein by reference to Exhibit 10.22 of the
               Registrant's Quarterly Report on Form 10-QSB for the quarter
               ended March 31, 2000).

10.22          Operating Agreement, dated May 16, 1997, by and between the
               Registrant and JRH Diversified, Inc. (incorporated herein by
               reference to Exhibit 10.23 of the Registrant's Quarterly Report
               on Form 10-QSB for the quarter ended June 30, 2000).

10.23          Employment Agreement, dated January 3, 2000, by and between the
               Bank and Angel J. Byrd (incorporated herein by reference to
               Exhibit 10.24 of the Registrant's Quarterly Report on Form 10-QSB
               for the quarter ended June 30, 2000).

21+            Subsidiaries.

23+            Consent of Porter Keadle & Moore, LLP.


_______________

*    Incorporated herein by reference to the exhibit of the same number in the
     Registrant's Registration Statement on Form S-4/A (No. 33-37601).


     +         Filed herewith.



     (b)  Reports on Form 8-K.

     One report on Form 8-K was filed by the Registrant with the Commission
during the quarter ended December 31, 2000, concerning the declaration by the
Board of Directors of: (i) third quarter net earnings of $351,941; and (ii) the
payment of a cash dividend of four cents per share to shareholders of record as
of November 1, 2000 and payable on November 14, 2000.

                                      -82-
<PAGE>

                                  SIGNATURES


     In accordance with Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.



                         COMMUNITY TRUST FINANCIAL SERVICES CORPORATION
                                             (Registrant)



Date: March 29, 2001                    By:  /s/Ronnie L. Austin
                                           -------------------------------
                                             Ronnie L. Austin
                                             President and Chief Executive
                                              Officer


                                        By:  /s/Angel J. Byrd
                                           -------------------------------
                                             Angel J. Byrd
                                             Controller
                                             (principal accounting officer)


     In accordance with the Securities Exchange Act of 1934, this report has
been signed below by the following persons on behalf of the Registrant and in
the capacities indicated on March 29, 2001.


       Signature                         Title
       ---------                         -----


/s/W. A. Foster III                   Chairman of the Board
-----------------------------
W. A. Foster III



/s/Ronnie L. Austin                   President, Chief Executive Officer and
-----------------------------         Director (principal executive officer)
Ronnie L. Austin



/s/George Berry                       Director
-----------------------------
George Berry

                                      -83-
<PAGE>

/s/R. Alan Bullock                    Director
-----------------------------
R. Alan Bullock



/s/Bobbie P. Cooper                   Director
-----------------------------
Bobbie P. Cooper



/s/Danny Drummond                     Director
-----------------------------
Danny Drummond



/s/J. Calvin Earwood                  Director
-----------------------------
J. Calvin Earwood



/s/Tommie R. Graham                   Director
-----------------------------
Tommie R. Graham



/s/James R. Parker                    Director
-----------------------------
James R. Parker



/s/W. Wyman Pilcher III               Director
-----------------------------
W. Wyman Pilcher III

                                      -84-
<PAGE>

                               INDEX OF EXHIBITS
                               -----------------



Exhibit No.    Description
-----------    -----------

    2.1+       Agreement and Plan of Reorganization, dated March 16, 2001, by
               and between GB&T Bancshares, Inc. and Community Trust Financial
               Services Corporation (the "Registrant").

    3.1*       Articles of Incorporation of the Registrant. Amendment to
               Articles of Incorporation of the Registrant (incorporated herein
               by reference to Exhibit 3.1 of the Registrant's Annual Report on
               Form 10-KSB for the fiscal year ended December 31, 1999).

    3.2*+      Bylaws of the Registrant

    4          Rights of the Registrant's security holders are defined in the
               Registrant's Articles of Incorporation and Bylaws, provided in
               Exhibits 3.1 and 3.2, respectively.

    10.1*      1988 Stock Option Plan and related specimen copy of option
               agreement.

    10.2       1993 Employee Stock Option Plan, as amended (incorporated herein
               by reference to Exhibit 10.2 of the Registrant's Annual Report on
               Form 10-KSB for the fiscal year ended December 31, 1999).

    10.24      1993 Directors Stock Option Plan, as amended (incorporated herein
               by reference to Exhibit 10.3 of the Registrant's Annual Report on
               Form 10-KSB for the fiscal year ended December 31, 1999).

    10.25      Lease, dated June 9, 1989, by and between First Baptist Church of
               Dallas, Georgia ("First Baptist") and the Community Trust Bank
               (the "Bank") relating to the lease of real property (incorporated
               herein by reference to Exhibit 10.5 of the Registrant's Annual
               Report on Form 10-K for the fiscal year ended December 31, 1992).

    10.26      Lease Extension Agreement, dated 1996, by and between First
               Baptist and the Bank relating to certain real property referred
               to in Exhibit 10.4 hereof (incorporated herein by reference to
               Exhibit 10.8 of the Registrant's Annual Report on Form 10-KSB for
               the year ended December 31, 1996).

    10.27      License and Equipment Purchase Agreement, dated July 27, 1991, by
               and between Bank South, National Association, and the Bank
               relating to the Paulding Commons Kroger branch (incorporated
               herein by reference to Exhibit 10.6 of the Registrant's Annual
               Report on Form 10-K for the fiscal year ended December 31, 1992).


                                      -85-
<PAGE>

    10.28      Lease, dated May 25, 1995, by and between Brock Investments, Inc.
               of Hiram, Georgia and the Bank relating to the lease of real
               property (incorporated herein by reference to Exhibit 10.7 of the
               Registrant's Annual Report on Form 10-K for the fiscal year ended
               December 31, 1995).


    10.29      Loan and Stock Pledge Agreement, dated November 14, 1998, by and
               between the Registrant and The Bankers Bank (incorporated herein
               by reference to Exhibit 2 of the Registrant's Current Report on
               Form 8-K, dated November 14, 1997).

    10.30      Employment Agreement, dated January 1, 1998, by and between the
               Registrant and Ronnie Austin, as amended (incorporated herein by
               reference to Exhibit 10.10 of the Registrant's Annual Report on
               Form 10-KSB for the fiscal year ended December 31, 1999).

    10.31      Employment Agreement, dated July 1, 1999, by and between
               Community Loan Company and Danny Drummond (incorporated herein by
               reference to Exhibit 10.11 of the Registrant's Quarterly Report
               on Form 10-QSB for the quarter ended September 30, 1999).

    10.32      Executive Supplemental Retirement Plan - Executive Agreement,
               dated January 13, 2000, by and between the Bank and Ronnie Austin
               (incorporated herein by reference to Exhibit 10.12 of the
               Registrant's Annual Report on Form 10-KSB for the fiscal year
               ended December 31, 1999).

    10.33      Life Insurance Endorsement Method Split Dollar Plan Agreement,
               dated January 13, 2000, by and between the Bank and Ronnie Austin
               (incorporated herein by reference to Exhibit 10.13 of the
               Registrant's Annual Report on Form 10-KSB for the fiscal year
               ended December 31, 1999).

    10.34      Deferred Compensation Plan for Key Employees and Directors
               (incorporated herein by reference to Exhibit 10.14 of the
               Registrant's Annual Report on Form 10-KSB for the fiscal year
               ended December 31, 1999).

    10.35      Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and R. Alan Bullock (incorporated
               herein by reference to Exhibit 10.15 of the Registrant's Annual
               Report on Form 10-KSB for the fiscal year ended December 31,
               1999).

    10.36      Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and Bobbie P. Cooper (incorporated
               herein by reference to Exhibit 10.16 of the Registrant's Annual
               Report on Form 10-KSB for the fiscal year ended December 31,
               1999).

    10.37      Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and J. Calvin Earwood (incorporated
               herein by


                                      -86-
<PAGE>

               reference to Exhibit 10.17 of the Registrant's Annual Report on
               Form 10-KSB for the fiscal year ended December 31, 1999).

    10.38      Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and William A. Foster, III
               (incorporated herein by reference to Exhibit 10.18 of the
               Registrant's Annual Report on Form 10-KSB for the fiscal year
               ended December 31, 1999).

    10.39      Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and Tommie R. Graham, Jr.
               (incorporated herein by reference to Exhibit 10.19 of the
               Registrant's Annual Report on Form 10-KSB for the fiscal year
               ended December 31, 1999).

    10.40      Director's Delayed Compensation Plan Agreement, dated October 26,
               1999, by and between the Bank and John C. Helms (incorporated
               herein by reference to Exhibit 10.20 of the Registrant's Annual
               Report on Form 10-KSB for the fiscal year ended December 31,
               1999).

    10.41      Life Insurance Endorsement Method Split Dollar Plan Agreement,
               dated January 13, 2000, by and between the Bank and Angel J. Byrd
               (incorporated herein by reference to Exhibit 10.21 of the
               Registrant's Quarterly Report on Form 10-QSB for the quarter
               ended March 31, 2000).

    10.42      Executive Supplemental Retirement Plan - Executive Agreement,
               dated January 13, 2000, by and between the Bank and Angel J. Byrd
               (incorporated herein by reference to Exhibit 10.22 of the
               Registrant's Quarterly Report on Form 10-QSB for the quarter
               ended March 31, 2000).

    10.43      Operating Agreement, dated May 16, 1997, by and between the
               Registrant and JRH Diversified, Inc. (incorporated herein by
               reference to Exhibit 10.23 of the Registrant's Quarterly Report
               on Form 10-QSB for the quarter ended June 30, 2000).

    10.44      Employment Agreement, dated January 3, 2000, by and between the
               Bank and Angel J. Byrd (incorporated herein by reference to
               Exhibit 10.24 of the Registrant's Quarterly Report on Form 10-QSB
               for the quarter ended June 30, 2000).

    21+        Subsidiaries.

    23+        Consent of Porter Keadle & Moore, LLP.

_______________
*    Incorporated herein by reference to the exhibit of the same number in the
     Registrant's Registration Statement on Form S-4/A (No. 33-37601).


+    Filed herewith.

                                      -87-