<PAGE>
                     U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-QSB

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                   SECURITIES EXCHANGE ACT OF 1934
       For the quarterly period ended March 31, 2002

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                   SECURITIES EXCHANGE ACT OF 1934
      For the transition period from         to         .

                          Commission File No. 333-63769

                        COMMUNITY SHORES BANK CORPORATION
        (Exact name of small business issuer as specified in its charter)

            Michigan                                     38-3423227
(State or other jurisdiction of              (IRS Employer Identification No.)
incorporation or organization)

                 1030 W. NORTON AVENUE, MUSKEGON, MICHIGAN 49441
                    (Address of principal executive offices)

                                 (231) 780-1800
                           (Issuer's telephone number)


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
                                 -----           -----

At April 30, 2002, 1,170,000 shares of Common Stock of the issuer were
outstanding.


Transitional Small Business Disclosure Format:
                              Yes              No  X
                                 -----           -----
<PAGE>
                     Community Shores Bank Corporation Index



PART I.  Financial Information                                          Page No.
                                                                        --------

         Item 1.   Financial Statements ..................................     1

         Item 2.  Management's Discussion and Analysis or Plan of
                     Operation............................................    11


PART II. Other Information

         Item 1.  Legal Proceedings.......................................    20
         Item 2.  Changes in Securities ..................................    20

         Item 3.  Defaults upon Senior Securities.........................    20

         Item 4.  Submission of Matters to a Vote of Security Holders.....    20

         Item 5.  Other Information.......................................    20

         Item 6.  Exhibits and Reports on Form 8-K........................    20

         Signatures.......................................................    22
         ----------


<PAGE>
PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                        COMMUNITY SHORES BANK CORPORATION
                      CONDENSED CONSOLIDATED BALANCE SHEETS




<TABLE>
<CAPTION>
                                                                 March 31,        December 31,
                                                                    2002             2001
                                                                -------------    -------------
                                                                 (Unaudited)
<S>                                                             <C>              <C>
ASSETS
Cash and due from financial institutions                        $   6,091,400    $   2,191,280
Interest-bearing deposits in other financial institutions              70,461           79,641
Federal funds sold                                                  6,250,000                0
                                                                -------------    -------------
     Total cash and cash equivalents                               12,411,861        2,270,921

Securities
   Available for sale (at fair value)                              34,241,824       24,671,925
   Held to maturity (fair value of $60,000 at March 31, 2002)          60,000           60,000
                                                                -------------    -------------
     Total securities                                              34,301,824       24,731,925

Loans                                                             124,660,237      118,115,580
Less: Allowance for loan losses                                     1,675,599        1,535,543
                                                                -------------    -------------
     Net loans                                                    122,984,638      116,580,037

Federal Home Loan Bank stock                                          425,000          425,000
Premises and equipment, net                                         3,112,831        3,173,724
Accrued interest receivable                                           694,911          703,433
Other assets                                                          397,822          306,236
                                                                -------------    -------------
     Total assets                                               $ 174,328,887    $ 148,191,276
                                                                =============    =============

LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
     Non interest-bearing                                       $   9,945,750    $   9,217,298
     Interest-bearing                                             127,665,265      100,931,036
                                                                -------------    -------------
          Total deposits                                          137,611,015      110,148,334

Federal funds purchased and repurchase agreements                  17,556,381       18,964,598
Federal Home Loan Bank advances                                     6,000,000        6,000,000
Notes payable                                                       3,500,000        3,400,000
Accrued expenses and other liabilities                                669,374          544,256
                                                                -------------    -------------
     Total liabilities                                            165,336,770      139,057,188

Shareholders' Equity
     Preferred Stock, no par value: 1,000,000 shares
       authorized and none issued                                           0                0
     Common Stock, no par value: 9,000,000
       shares authorized and 1,170,000 shares issued and
       outstanding                                                 10,871,211       10,871,211
     Retained deficit                                              (2,025,261)      (2,190,931)
     Accumulated other comprehensive income                           146,167          453,808
                                                                -------------    -------------

     Total shareholders' equity                                     8,992,117        9,134,088
                                                                -------------    -------------
     Total liabilities and shareholders' equity                 $ 174,328,887    $ 148,191,276
                                                                =============    =============
</TABLE>




     See accompanying notes to condensed consolidated financial statements.



                                      -1-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                       March 31,    March 31,
                                                         2002         2001
                                                      ----------   ----------
<S>                                                   <C>          <C>
INTEREST AND DIVIDEND INCOME
Loans, including fees                                 $2,159,850   $2,218,522
Securities                                               326,999      319,317
Federal funds sold, FHLB dividends and other income       67,991      100,199
                                                      ----------   ----------
     Total interest income                             2,554,840    2,638,038
INTEREST EXPENSE
Deposits                                               1,078,248    1,440,499
Repurchase agreements and federal funds purchased
     and other debt                                       84,986      109,131
Federal Home Loan Bank advances and notes payable        138,876      135,766
                                                      ----------   ----------
     Total interest expense                            1,302,110    1,685,396

NET INTEREST INCOME                                    1,252,730      952,642
Provision for loan losses                                127,800      101,500
                                                      ----------   ----------

NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES    1,124,930      851,142
Noninterest income
Service charges on deposit accounts                       99,673       97,739
Mortgage loan referral fees                               44,935       35,553
Gain on disposition of securities                              0        5,036
Other                                                     41,843       28,493
                                                      ----------   ----------
     Total noninterest income                            186,451      166,821

Noninterest expense
Salaries and employee benefits                           619,423      557,565
Occupancy                                                 71,376       60,148
Furniture and equipment                                  110,867      112,940
Advertising                                               14,211       22,020
Data Processing                                           57,126       40,968
Professional services                                     42,284       55,674
Other                                                    230,423      164,852
                                                      ----------   ----------
     Total noninterest expense                         1,145,710    1,014,167

INCOME BEFORE INCOME TAXES                               165,671        3,796
Federal income tax expense                                     0            0
                                                      ----------   ----------
NET INCOME                                            $  165,671   $    3,796
                                                      ==========   ==========

Weighted average shares outstanding                    1,170,000    1,170,000
                                                      ==========   ==========
Basic and diluted income per share                    $     0.14   $     0.00
                                                      ==========   ==========
</TABLE>





See accompanying notes to condensed consolidated financial statements.



                                       -2-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                       CONDENSED CONSOLIDATED STATEMENT OF
                         CHANGES IN SHAREHOLDERS' EQUITY
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                                                Accumulated
                                                                                                   Other           Total
                                                             Common         Retained          Comprehensive    Shareholders'
                                              Shares          Stock          Deficit           Income (Loss)       Equity
                                            --------------------------------------------------------------------------------
<S>                                            <C>          <C>             <C>
Balance, January 1, 2001                       1,170,000    $ 10,871,211    $ (2,619,299)         $ 241,334     $ 8,493,246

Comprehensive Income:
     Net Income                                                                    3,796                              3,796
     Unrealized gain on securities
     available for sale                                                                             175,815         175,815
                                                                                                                ------------
          Total comprehensive income                                                                                179,611
                                            --------------------------------------------------------------------------------

Balance, March 31, 2001                        1,170,000    $ 10,871,211    $ (2,615,503)         $ 417,149     $ 8,672,857
                                            ================================================================================


Balance, January 1, 2002                       1,170,000    $ 10,871,211    $ (2,190,932)         $ 453,808     $ 9,134,087

Comprehensive loss:
     Net Income                                                                  165,671                            165,671
     Unrealized loss on securities
     available for sale                                                                            (307,641)       (307,641)
                                                                                                                ------------
          Total comprehensive loss                                                                                 (141,970)
                                            --------------------------------------------------------------------------------

Balance, March 31, 2002                        1,170,000    $ 10,871,211    $ (2,025,261)         $ 146,167     $ 8,992,117
                                            ================================================================================
</TABLE>

















     See accompanying notes to condensed consolidated financial statements.

                                      -3-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (UNAUDITED)



<TABLE>
<CAPTION>
                                                                Three months       Three months
                                                                   ended               ended
                                                               March 31, 2002     March 31, 2001
                                                               --------------     --------------
<S>                                                             <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES
     Net Income                                                 $    165,671      $      3,796
     Adjustments to reconcile net income (loss) to net
        cash from operating activities
          Provision for loan losses                                  127,800           101,500
          Depreciation and amortization                               96,353           105,609
          Net accretion of securities                                (16,014)          (36,143)
          Net realized gain on disposition of securities                   0            (5,036)
          Net change in:
               Accrued interest receivable and other assets          (83,064)           35,213
               Accrued interest payable and other liabilities         49,820           183,792
                                                                ------------      ------------
                   Net cash from operating activities                340,566           388,731
CASH FLOWS FROM INVESTING ACTIVITIES
     Activity in available-for-sale securities:
          Sales                                                            0                 0
          Maturities, prepayments and calls                        3,212,888         3,028,220
          Purchases                                              (12,999,117)       (2,997,111)
     Loan originations and payments, net                          (6,532,401)       (5,551,817)
     Additions to premises and equipment                             (35,460)         (135,762)
                                                                ------------      ------------
               Net cash used in investing activities             (16,354,090)       (5,656,470)
CASH FLOWS FROM FINANCING ACTIVITIES
     Net change in deposits                                       27,462,681         9,874,405
     Net change in federal funds purchased and
          repurchase agreements                                   (1,408,217)        1,888,613
     Federal Home Loan Bank activity:
          New Advances                                             1,500,000                 0
          Maturities and payments                                 (1,500,000)                0
     Net proceeds from note payable                                  100,000           850,000
                                                                ------------      ------------
               Net cash from financing activities                 26,154,464        12,613,018

Net change in cash and cash equivalents                           10,140,940         7,345,279
Beginning cash and cash equivalents                                2,270,921         6,262,326
                                                                ------------      ------------

ENDING CASH AND CASH EQUIVALENTS                                $ 12,411,861      $ 13,607,605
                                                                ============      ============
Supplemental cash flow information:
     Cash paid during the period for interest                   $  1,253,489      $  1,551,117
</TABLE>





     See accompanying notes to condensed consolidated financial statements.



                                      -4-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.       BASIS OF PRESENTATION:

         The unaudited financial statements as of and for the three months ended
         March 31, 2002 include the condensed consolidated results of operations
         of Community Shores Bank Corporation ("Company") and its wholly-owned
         subsidiaries, Community Shores Bank ("Bank") and Community Shores
         Mortgage Company ("Mortgage Company"). These condensed consolidated
         financial statements have been prepared in accordance with the
         instructions for Form 10-QSB and Item 310(b) of Regulation S-B and do
         not include all disclosures required by generally accepted accounting
         principles for a complete presentation of the Company's financial
         condition and results of operations. In the opinion of management, the
         information reflects all adjustments (consisting only of normal
         recurring adjustments) which are necessary in order to make the
         financial statements not misleading and for a fair representation of
         the results of operations for such periods. The results for the period
         ended March 31, 2002 should not be considered as indicative of results
         for a full year. For further information, refer to the condensed
         consolidated financial statements and footnotes included in the
         Company's annual report on Form 10-KSB for the period ended December
         31, 2001. Some items in the prior year financial statements were
         reclassified to conform to the current presentation.

2.       SECURITIES

         The following tables represent the securities held in the Company's
         portfolio at March 31, 2002 and at December 31, 2001:



<TABLE>
<CAPTION>
                                                           Gross           Gross
                                         Amortized      Unrealized       Unrealized         Fair
(Unaudited)                                 Cost          Gains            Losses          Value       %
-------------------------------------------------------------------------------------------------------------
<S>                                    <C>              <C>              <C>          <C>            <C>
Available for sale:
    US Treasuries                      $ 11,487,618              0          (5,190)   $ 11,482,428     33.5%
    US Government and federal agency     10,648,307        292,006         (28,428)     10,911,885     31.8
    Municipal securities                    219,584              0            (676)        218,908      0.6
    Mortgaged-backed securities          11,664,850         52,418         (88,665)     11,628,603     33.9
                                       ---------------------------------------------------------------------
                                         34,020,359        344,424        (122,959)     34,241,824     99.8
Held to maturity:
    Municipal securities                     60,000              0               0          60,000      0.2
                                       ---------------------------------------------------------------------

Total securities at March 31, 2002     $ 34,080,359   $    344,424    $   (122,959)   $ 34,301,824    100.0%
                                       =====================================================================
</TABLE>






                                      -5-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

2.         SECURITIES-continued


<TABLE>
<CAPTION>
                                                            Gross           Gross
                                          Amortized      Unrealized      Unrealized         Fair
(Unaudited)                                  Cost          Gains           Losses           Value         %
------------------------------------------------------------------------------------------------------------
<S>                                     <C>              <C>          <C>              <C>            <C>
Available for sale:
    US Treasuries                       $    499,955              0            (273)   $    499,682      2.0%
    US Government and federal agency      12,129,428        391,297         (12,849)     12,507,876     50.6
    Municipal securities                     219,579              0          (2,212)        217,367      0.9
    Mortgaged-backed securities           11,369,155        115,988         (38,143)     11,447,000     46.3
                                        --------------------------------------------------------------------
                                          24,218,117        507,285         (53,477)     24,671,925     99.8
Held to maturity:
    Municipal securities                      60,000              0               0          60,000      0.2
                                        --------------------------------------------------------------------

Total securities at December 31, 2001   $ 24,278,117   $    507,285    $    (53,477)   $ 24,731,925    100.0%
                                        ====================================================================
</TABLE>

           Securities increased $9,569,899 during the first three months of
           2002. Below is the schedule of maturities for investments held at
           March 31, 2002:


<TABLE>
<CAPTION>
                                            Securities available for sale   Securities held to maturity
                                             Amortized        Fair          Amortized           Fair
                                               Cost           Value            Cost             Value
           --------------------------------------------------------------------------------------------
<S>                                          <C>             <C>             <C>             <C>
           Due in one year or less           $15,383,527     $15,437,751     $        -      $       -
           Due from one to five years          6,752,399       6,956,562              0              0
           Due in more than five years           219,584         218,909              0              0
           Mortgage-backed and Municipal      11,664,849      11,628,602         60,000         60,000
                                             ---------------------------------------------------------
                                             $34,020,359     $34,241,824     $   60,000      $  60,000
                                             =========================================================
</TABLE>



3.       LOANS

         Loans increased $6,544,657 since December 31, 2001. The components of
         the outstanding balances, their percentage of the total portfolio and
         the percentage increase from the end of 2001 to the end of the first
         quarter of 2002 were as follows:

<TABLE>
<CAPTION>
                                                                                                        Percent
                                          March 31, 2002                December 31, 2001              Increase/
                                          Balance        %               Balance         %             (Decrease)
                                          ----------------              ------------------             ----------
<S>                                        <C>           <C>              <C>           <C>            <C>
Commercial, financial and other            $94,348,582   75.7 %           $89,258,193    75.6 %            5.7 %
Real estate-construction                     2,954,040    2.4               3,081,361     2.6             (4.1)
Real estate-mortgages                        4,034,393    3.2               3,761,403     3.2              7.3
Installment loans to individuals            23,323,222   18.7              22,014,623    18.6              5.9
                                         --------------------           ---------------------
                                           124,660,237  100.0 %           118,115,580   100.0 %
                                                        =====                           =====
Less allowance for loan losses               1,675,599                      1,535,543
                                         --------------                 --------------
                                         $ 122,984,638                  $ 116,580,037
                                         ==============                 ==============

</TABLE>




                                      -6-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

4.       ALLOWANCE FOR LOAN LOSSES

         The following is a summary of activity in the allowance for loan losses
         account for the three month period ended March 31, 2002 and 2001:

<TABLE>
<CAPTION>
                                                              Three Months      Three Months
                                                                 Ended             Ended
         (Unaudited)                                           03/31/02          03/31/01
         -----------------------------------------------    ----------------  ----------------
<S>                                                              <C>               <C>
         Beginning Balance                                       $1,535,543        $1,269,050

         Charge-offs                                                (10,624)          (72,321)
         Recoveries                                                  22,880            22,865
         Provision charged against operating expense                127,800           101,500
                                                            ----------------  ----------------

         Ending Balance                                          $1,675,599        $1,321,094
                                                            ================  ================
</TABLE>


5.       DEPOSITS

         Deposit balances increased $27,462,681 since December 31, 2001. The
         components of the outstanding balances, their percentage of the total
         portfolio and the percentage increase from the end of 2001 to the end
         of the first quarter of 2002 were as follows:

<TABLE>
<CAPTION>
                                                                                                                      Percent
                                                       March 31, 2002                     December 31, 2001          Increase/
                                                       Balance          %                 Balance        %          (Decrease)
                                                  -----------------------             ---------------------          ---------
<S>                                                  <C>            <C>               <C>            <C>            <C>
              Noninterest-bearing
                   Demand                              $ 9,945,750    7.2 %             $ 9,217,298    8.4 %          42.1 %
              Interest-bearing
                   Checking                             33,644,275   24.5                20,979,462   19.0           241.8
                   Money Market                         22,052,133   16.0                18,612,647   16.9           165.4
                   Savings                               2,732,384    2.0                 2,332,538    2.1           195.2
                   Time, under $100,000                 32,116,471   23.3                30,913,935   28.1             1.6
                   Time, over $100,000                  37,120,002   27.0                28,092,454   25.5            (7.7)
                                                  -----------------------             --------------------
              Total Deposits                         $ 137,611,015  100.0 %           $ 110,148,334  100.0 %
                                                  =======================             ====================
</TABLE>


6.       SHORT-TERM BORROWINGS

         Both federal funds purchased and repurchase agreements were outstanding
         at December 31, 2001. At March 31, 2002, the Bank's short-term
         borrowings were made up of repurchase agreements only. In the three
         month period since December 31, 2001 outstanding borrowings decreased
         $1,408,217. The March 31, 2002 and December 31, 2001 information was as
         follows:



                                      -7-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

6.       SHORT-TERM BORROWINGS-continued

<TABLE>
<CAPTION>
                                                            Repurchase        Federal Funds
                                                            Agreements          Purchased
                                                            ----------          ---------
<S>                                                         <C>               <C>
              Outstanding at March 31, 2002                 $ 17,556,381      $        0
              Average interest rate at period end                  1.93%            0.00%
              Average balance during period                   15,234,208        1,200,000
              Average interest rate during period                  2.07%            2.09%
              Maximum month end balance during period         17,556,381                0


              Outstanding at December 31, 2001              $ 12,264,598      $ 6,700,000
              Average interest rate at year end                    2.04%            1.82%
              Average balance during year                     12,282,957        1,053,836
              Average interest rate during year                    3.36%            3.16%
              Maximum month end balance during year           14,589,092        6,700,000
</TABLE>



7.       FEDERAL HOME LOAN BANK BORROWINGS

         The Bank was approved in the first quarter of 1999 to be a member of
         the Federal Home Loan Bank of Indianapolis. Based on its current
         Federal Home Loan Bank Stock holdings the Bank has the capacity to
         borrow $8,500,000. Each borrowing requires a direct pledge of
         securities or loans. At this time, the Bank has securities with a
         market value of $6,123,889 pledged to the Federal Home Loan Bank to
         support current borrowings. Details of the Bank's outstanding
         borrowings at both March 31, 2002 and December 31, 2001 are:


<TABLE>
<CAPTION>
                                                 Current
                                                 Interest
              Maturity Date:                       Rate            March 31, 2002        December 31, 2001
              ---------------------              --------          --------------        -----------------
<S>                                              <C>               <C>                   <C>
              March 24, 2010                       5.99                $1,500,000             $ 1,500,000
              November 3, 2010                     5.95                 2,000,000               2,000,000
              December 13, 2010                    5.10                 2,500,000               2,500,000
                                                                   --------------        ----------------

              Total outstanding at                                     $6,000,000             $ 6,000,000
                                                                   ==============        ================
</TABLE>

8.       NOTES PAYABLE

         Since June 28, 2000, the Company borrowed $3,500,000 from four of its
         Directors and Community Shores LLC. Community Shores LLC (the "LLC")
         was formed by 7 of the Company's Directors for the purpose of obtaining
         and lending money to the Company. The members of the LLC are David C.
         Bliss, Gary F. Bogner, Robert L. Chandonnet, Dennis L. Cherette, Bruce
         J. Essex, Michael D. Gluhanich and Jose A. Infante. Two of the





                                      -8-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

8.       NOTES PAYABLE-continued

         LLC members lent money directly as well as taking part in the LLC. A
         summary of the loans is given below:

<TABLE>
<CAPTION>
         ----------------------------------------------------------------------
         Loan from:                Aggregate    Current Rate    Maturity
                                   Principal
                                   Amount
         ----------------------------------------------------------------------
<S>                                <C>          <C>             <C>
         Robert L. Chandonnet      $  200,000   6.25%           June 30, 2007
         Michael D. Gluhanich      $  100,000   6.25%           June 30, 2007
         Donald E. Hegedus         $  500,000   6.25%           June 30, 2007
         John L. Hilt              $  750,000   6.25%           June 30, 2007
         Community Shores LLC      $1,950,000   6.25%           June 30, 2007
         ----------------------------------------------------------------------

         Total                     $3,500,000
         ----------------------------------------------------------------------
</TABLE>

         The rate on the above notes is floating and is officially defined as
         1.50% over the US Bank, N.A. Prime rate. US Bank's current prime rate
         is 4.75%. Interest is owed quarterly in arrears on the fifteenth of
         April, July, October and January until the principal of these Notes is
         paid or made available for payment. The notes may be prepaid without
         any prepayment penalty with at least one day's prior written notice.
         The principal and interest related to these Notes is expressly
         subordinated to any and all senior debt of the Company. The proceeds
         from these Notes were primarily used to infuse capital into the Bank to
         maintain sufficient capital ratios to comply with banking regulations.


9.       COMMITMENTS AND OFF-BALANCE SHEET RISK

         Some financial instruments are used to meet financing needs and to
         reduce exposure to interest rate changes. These financial instruments
         include commitments to extend credit and standby letters of credit.
         These involve, to varying degrees, credit and interest-rate risk in
         excess of the amount reported in the financial statements. Commitments
         to extend credit are agreements to lend to a customer as long as there
         is no violation of any condition established in the commitment, and
         generally have fixed expiration dates. Standby letters of credit are
         conditional commitments to guarantee a customer's performance to a
         third party. Exposure to credit loss if the other party does not
         perform is represented by the contractual amount for commitments to
         extend credit and standby letters of credit. Collateral or other
         security is normally not obtained for these financial instruments prior
         to their use, and many of the commitments are expected to expire
         without being used.

         A summary of the notional and contractual amounts of outstanding
         financing instruments with off-balance-sheet risk as of March 31, 2002
         and December 31, 2001 follows:



                                      -9-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

9.       COMMITMENTS AND OFF-BALANCE SHEET RISK-continued




<TABLE>
<CAPTION>
                                                                 March 31, 2002          December 31,
                                                                    2002                     2001
                                                                 (Unaudited)
                                                                 --------------         ---------------
<S>                                                              <C>                    <C>
              Letters of credit                                     $   255,000            $   306,000
              Commercial unused lines of credit                      23,215,000             23,700,000
              Consumer unused lines of credit                         3,958,000              3,329,000
              Residential construction commitments                      378,000                749,000
</TABLE>



         Commitments to make loans generally terminate one year or less from the
         date of commitment and may require a fee. Since many of the above
         commitments expire without being used, the above amounts do not
         necessarily represent future cash commitments. No losses are
         anticipated as a result of these transactions.



10.      REGULATORY MATTERS

         The Company and Bank are subject to regulatory capital requirements
         administered by the federal banking agencies. Capital adequacy
         guidelines and prompt corrective action regulations involve
         quantitative measures of assets, liabilities, and certain
         off-balance-sheet items calculated under regulatory accounting
         practices. Capital amounts and classifications are also subject to
         qualitative judgments by regulators about components, risk weightings,
         and other factors, and the regulators can lower classifications in
         certain cases. Failure to meet various capital requirements can
         initiate regulatory action that could have a direct material effect on
         the financial statements.

         The prompt corrective action regulations provide five classifications,
         including well capitalized, adequately capitalized, undercapitalized,
         significantly undercapitalized, and critically undercapitalized,
         although these terms are not used to represent overall financial
         condition. If adequately capitalized, regulator approval is required to
         accept brokered deposits. If undercapitalized, capital distributions
         are limited, as is asset growth and expansion, and plans for capital
         restoration are required.

<TABLE>
<CAPTION>
                                          Capital to risk weighted
                                                  assets
                                          -----------------------               Tier 1 Capital
                                            Total         Tier 1               to average assets
                                          --------       --------             --------------------
<S>                                            <C>           <C>                     <C>
              Well capitalized                 10 %          6 %                     5 %
              Adequately capitalized            8            4                       4
              Undercapitalized                  6            3                       3
</TABLE>




                                      -10-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


10.      REGULATORY MATTERS-continued

         Actual capital levels and minimum required levels at March 31, 2002 for
         the Company and Bank were:






<TABLE>
<CAPTION>
                                           Actual                Adequately Capitalized          Well Capitalized
                                  --------------------------   ----------------------------   ------------------------
         March 31,2002                 Amount       Ratio            Amount         Ratio          Amount      Ratio
                                  --------------------------   ----------------------------   ------------------------
<S>                                   <C>             <C>             <C>             <C>         <C>           <C>
         -------------------------
         Total capital (to risk-
            weighted assets)
               Consolidated           $ 14,021,549    10.38 %         $ 10,802,391    8.00 %      $ 13,502,989  10.00 %
               Bank                     13,980,417    10.35             10,801,511    8.00          13,501,889  10.00

         Tier 1 capital (to risk-
            weighted assets)
               Consolidated              8,845,950     6.55              5,401,195    4.00           8,101,793   6.00
               Bank                     12,304,817     9.11              5,400,755    4.00           8,101,133   6.00

         Tier 1 capital (to
            average assets)
               Consolidated              8,845,950     5.28              6,704,373    4.00           8,380,466   5.00
               Bank                     12,304,817     7.34              6,703,933    4.00           8,379,916   5.00
</TABLE>



The Company and the Bank were in the well capitalized category at March 31,
2002. The Company is closely monitoring the Bank's growth and expects to infuse
additional capital as necessary to maintain at least a 10% (well capitalized)
total capital to risk weighted assets ratio.



ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION


The discussion below details the financial results of the Company and its wholly
owned subsidiaries, the Bank and the Mortgage Company, through March 31, 2002
and is separated into two parts which are labeled, Financial Condition and
Results of Operations. The part labeled Financial Condition compares the
financial condition at March 31, 2002 to that at December 31, 2001. The part
labeled Results of Operations discusses the three month period ended March 31,
2002 as compared to the same period of 2001. Both parts should be read in
conjunction with the interim condensed consolidated financial statements and
footnotes included in Item 1 of this Form 10-QSB.





                                      -11-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS


This discussion and analysis and other sections of this 10-QSB contains
forward-looking statements that are based on management's beliefs, assumptions,
current expectations, estimates and projections about the financial services
industry, the economy, and about the Company, the Bank and the Mortgage Company.
Words such as "anticipates", "believes", "estimates", "expects", "forecasts",
"intends", "is likely", "plans", "projects", variations of such words and
similar expressions are intended to identify such forward-looking statements.
These forward-looking statements are intended to be covered by the safe-harbor
provisions of the Private Securities Litigation Reform Act of 1995. These
statements are not guarantees of future performance and involve certain risks,
uncertainties and assumptions ("Future Factors") that are difficult to predict
with regard to timing, extent, likelihood and degree of occurrence. The Company
undertakes no obligation to update, amend, or clarify forward looking
statements, whether as a result of new information, future events (whether
anticipated or unanticipated), or otherwise.

Future Factors include changes in interest rates and interest rate
relationships; demand for products and services; the degree of competition by
traditional and non-traditional competitors; changes in banking regulation;
changes in tax laws; changes in prices, levies, and assessments; the impact of
technological advances; governmental and regulatory policy changes; the outcomes
of contingencies; trends in customer behavior as well as their ability to repay
loans; changes in the national and local economy; and other factors, including
risk factors, referred to from time to time in filings made by the Company with
the Securities and Exchange Commission. These are representative of the Future
Factors that could cause a difference between an ultimate actual outcome and a
preceding forward-looking statement.


FINANCIAL CONDITION

Total assets increased by $26,137,611 to $174,328,887 at March 31, 2002 from
$148,191,276 at December 31, 2001. This is an 18% increase in assets during the
first three months of 2002. Growth is mostly attributable to an increase in the
Bank's security portfolio and loan volume. Management continues to focus on
small- to medium-sized business customers, the original strategy since opening
in January 1999.

Cash and cash equivalents increased by $10,140,940 to $12,411,861 at March 31,
2002 from $2,270,921 at December 31, 2001. This increase was the result of an
additional $3,900,120 being held at other financial institutions as well as an
increase in federal funds sold. The Bank's reserve requirement at the Federal
Reserve Bank had increased significantly due to various intra-period deposits in
interest-bearing demand accounts. Additionally there was $6,250,000 in federal
funds sold on March 31, 2002 compared to none being sold on December 31, 2001.

Securities held increased by $9,569,899 in the first quarter of 2002. The
majority of the purchases were driven by unexpected, short-term liquidity and
general growth in the Bank's repurchase agreement account holdings. A repurchase
agreement is not considered a deposit



                                      -12-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

by the FDIC and is therefore not eligible for FDIC insurance coverage. The
recorded liability is treated like a short-term borrowing of the Bank. To secure
the short-term borrowing (repurchase agreement), balances held by customers are
typically collateralized by high quality government securities held within the
Bank's security portfolio. If the repurchase balances continue to increase, the
purchase of additional Treasuries and Agencies will be required to fulfill the
collateralization requirement. As of March 31, 2002, there were unpledged
securities in the Bank's investment portfolio with a fair market value of
approximately $10,200,000.

Total loans climbed to $124,660,237 at March 31, 2002 from $118,115,580 at
December 31, 2001. Of the $6,544,657 increase experienced, 78% occurred in the
commercial loan portfolio and 20% occurred in the installment loan portfolio.
The "wholesale" banking focus applied since opening in 1999 continued during the
first three months of 2002. Presently, the commercial category of loans
comprises 76% of the Bank's total loan portfolio. There are five experienced
commercial lenders on staff devoted to pursuing and originating these types of
loans. Growth was also experienced on the "retail" lending side. Installment
loans increased $1,308,599 or 6%, over the balance reported at December 31,
2001. Growth in this category was mostly the result of new business in direct
and indirect automobile loans and home equity loans. Overall, the growth in
total loans was above expectations. Management is optimistic about additional
volume in the remaining quarters of 2002 given the favorable interest rate
environment and the opportunities in the Bank's market resulting from the
acquisition of a competitor bank by an out-of-state bank holding company.

The loan maturities and rate sensitivity of the loan portfolio at March 31, 2002
have been included below:


<TABLE>
<CAPTION>
                                       Within        Three to        One to          After
                                        three         twelve          five            five
                                       months         months          years          years         Total
                                   ------------------------------------------------------------------------

<S>                                <C>            <C>            <C>            <C>            <C>
Commercial, financial and other    $ 20,717,374   $ 20,583,777   $ 50,438,454   $  2,608,977   $ 94,348,582
Real estate-construction              1,697,473      1,256,567              0              0      2,954,040
Real estate-mortgages                    21,236         73,068        675,888      3,264,201      4,034,393
Installment loans to individuals      1,842,846      3,105,801     15,645,783      2,728,792     23,323,222
                                   ------------------------------------------------------------------------
                                   $ 24,278,929   $ 25,019,213   $ 66,760,125   $  8,601,970   $124,660,237
                                   ========================================================================

Loans at fixed rates                  4,932,459      3,263,018     50,062,924      8,253,044   $ 66,511,445
Loans at variable rates              19,346,470     21,756,195     16,697,201        348,926     58,148,792
                                   ------------------------------------------------------------------------
                                   $ 24,278,929   $ 25,019,213   $ 66,760,125   $  8,601,970   $124,660,237
                                   ========================================================================
</TABLE>




The loan portfolio is reviewed and analyzed on a regular basis for the purpose
of estimating probable credit losses. The allowance for loan losses is adjusted
accordingly to maintain an adequate level to absorb probable losses given the
risk characteristics of the loan portfolio. At March 31, 2002, the allowance
totaled $1,675,599 or approximately 1.34% of gross loans outstanding. Management
has determined that this is an appropriate level based on their estimate of
losses inherent in the loan portfolio after their detailed review as well as
from


                                      -13-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

comparison of allowance levels maintained by other institutions with similar,
but seasoned loan portfolios. The allocation of the allowance at March 31, 2002
was as follows:


<TABLE>
<CAPTION>
                                                   March 31, 2002                December 31, 2001
                                                          Percent of                         Percent of
                                                           allowance                         allowance
Balance at End of Period Applicable to:                   related to                         related to
                                                Amount    loan category      Amount        loan category
                                              ----------  -------------    ----------      -------------
<S>                                           <C>         <C>              <C>             <C>
Commercial                                    $1,317,098           78.6 %  $1,180,208               76.9 %
Residential real estate                           68,660            4.1        68,268                4.4
Installment                                      289,841           17.3       287,067               18.7
Unallocated                                            0            0.0             0                0.0
                                              ----------  -------------    ----------      -------------

Total                                         $1,675,599          100.0 %  $1,535,543              100.0 %
                                              ==========  =============    ==========      =============

</TABLE>


Given the size and composition of the bank's loan portfolio and its
concentration of commercial loans, this allocation is felt to be in line with
the banking industry's historical loan loss experience. Management will continue
to monitor the allocation and make necessary adjustments based on portfolio
concentration levels, actual loss experience and the financial condition of the
borrowers. As such, an additional $127,800 was provided for since December 31,
2001. At the end of March 2002, loans 30-59 days past due totaled $1,725,431 up
from $735,005 at December 31, 2001. Approximately $1,088,000 of the increase in
these past due balances was related to commercial loans which was partially
offset by a decrease in retail past dues of $100,000. There was a total of
$171,980 past due 60-89 days and $316,532 past due more than 89 days at the end
of 2001 compared to $762,365 past due 60-89 days and $225,435 past due more than
89 days at the end of the first quarter of 2002. Although the percentage of
loans past due has increased in most categories since December 31, 2001,
management feels that it is all in the normal seasoning of the portfolio and
that our past due statistics are in line with our peer banks. At March 31, 2002
the Bank had four non-accrual notes with an aggregate total of $316,417. The
Bank had no non-accrual loans at the end of December 2001. Net charge-offs
recorded in 2001 were $128,527. In the first three months of 2002, the Bank had
net recoveries of $12,256.

Bank premises and equipment decreased $60,893 to $3,112,831 at March 31, 2002
from $3,173,724 at December 31, 2001. Accumulated depreciation and amortization
represented $1,001,789 at year-end compared to $1,098,142 at March 31, 2002. No
significant capital expenditures were made in the first quarter of 2002.

Other assets increased $91,586 from December 31, 2001 to March 31, 2002. The
Bank's prepaid expenses were responsible for all of the increase. In general,
prepaid expenses are at their lowest point at year-end and highest at the
beginning of the year. Deposit balances were $137,611,015 at March 31, 2002 up
from $110,148,334 at December 31, 2001. The increase in



                                      -14-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

the categories of interest-bearing checking and money market accounts was
$16,104,299 for the first quarter of 2002. The growth was mostly due to an
increase in balances on deposit by several existing public fund customers. Based
on the cash flow projections of these particular customers it is anticipated
that a large portion of their balances on deposit will be used in the month of
May. Time deposits and savings accounts increased $10,629,930 or 15% since
December 31, 2001. Occasionally management chooses to fund a portion of the
Bank's loan growth by obtaining brokered deposits. Brokered deposits went from
23% to 24% of total deposits during the quarter. Brokered deposits are time
deposits obtained from depositors located outside of our market area and are
placed with the Bank by a deposit broker. Conversely, in January the Bank
conducted a time deposit promotion in honor of its third anniversary and was
able to attract approximately $5,489,000 of local money during the four-week
campaign.

Repurchase agreements increased $5,291,783 since December 31, 2001. This
represents an increase of 43% for the first three months of 2002. The growth is
attributable to existing customers increasing their carrying balances from those
held at year-end as well as the addition of new customers using this banking
product. The Bank's Federal Home Loan Bank ("FHLB") advances outstanding was
$6,000,000 at both March 31, 2002 and December 31, 2001. On January 9, 2002, the
Bank arranged to borrow $1,500,000 for 180 days at a variable rate. The proceeds
were used to resolve a short-term liquidity deficit at the beginning of 2002.
The loan was repaid on January 22, 2002. In March, two of the three putable
advances owned by the Bank were eligible for conversion to a floating rate at
the option of the FHLB. The FHLB did not exercise its right in either case. The
putable advances of $2,500,000 and $1,500,000 continue to accrue interest at
rates of 5.10% and 5.99% respectively. Going forward the FHLB will have the
right to exercise its option on both notes every ninety days. In the event that
either note converts to a floating rate, management has the right to pay off the
note with no pre-payment penalty. At this time, it is not anticipated that
either advance will convert to a floating rate given the nature of the current
rate environment.

As of March 31, 2002, the Company had borrowed $3,500,000 from some of its
Directors and Community Shores LLC for the purpose of infusing capital into the
Bank and to provide cash for the operating expenses of the Company. The current
balance is $100,000 more than the outstanding balance on December 31, 2001. This
debt is subordinated to all senior debt of the Company. The notes have a
floating rate and are currently accruing interest at 6.25% per annum. Interest
payments are due quarterly on the fifteenth of the month. The next scheduled
interest payment is due on July 15, 2002. Based on anticipated asset growth
rates for the next three quarters, the Bank is expecting to need additional
funds beyond the growth in its retained earnings to maintain a well capitalized
capital ratio. The Company has evaluated several possible strategies to
effectively increase capital levels. During the first half of May of 2002, the
Company obtained $200,000 of capital. The Company intends to obtain more capital
in the near future and to contribute the $200,000 and most of the additional
capital to the Bank to maintain the desired capital ratio.






                                      -15-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

RESULTS OF OPERATIONS

The net income for the first quarter of 2002 was $165,671 which compares
favorably to the net income of $3,796 recorded in the first quarter of 2001. For
the first quarter of 2002, the annualized return on the Company's average total
assets and average equity was .40% and 7.24% respectively. At March 31, 2002,
the ratio of average equity to average assets was 5.46%. The Company's retained
deficit was $2,025,261 at March 31, 2002 compared to $2,190,931 at December 31,
2001. The actual operating results for the first three months of 2002 were
better than management's internal, budgeted goal. The main contributing factor
to the above results is the improvement in net interest income.

The following tables sets forth certain information relating to the Company's
consolidated average interest earning assets and interest-bearing liabilities
and reflects the average yield on assets and average cost of liabilities for the
periods indicated. Such yields and costs are derived by dividing annualized
income or expenses by the average daily balance of assets or liabilities,
respectively, for the periods presented.



<TABLE>
<CAPTION>
                                                                        Three months ended March 31:
                                                          2002                                        2001
                                                 Average                     Average         Average                   Average
                                                 balance       Interest        rate          balance        Interest     rate
                                               --------------------------------------   ---------------------------------------
<S>                                            <C>             <C>           <C>         <C>              <C>          <C>
Assets
   Federal funds sold and interest-bearing
    deposits with other financial institutions $  14,637,192   $   61,702      1.69 %    $   6,930,913   $   94,281      5.44 %
   Investment securities                          24,147,955      333,288      5.52         19,664,024      325,235      6.62
   Loans                                         121,393,351    2,159,850      7.12         98,836,295    2,218,522      8.98
                                               ------------------------------------      --------------------------------------
                                                 160,178,498    2,554,840      6.38        125,431,232    2,638,038      8.41
   Other assets                                    7,430,830                                 6,434,242
                                               -------------                             -------------
                                               $ 167,609,328                             $ 131,865,474
                                               =============                             =============

Liabilities and Shareholders' Equity
   Interest-bearing deposits                   $ 122,258,027   $1,078,248      3.53      $  97,244,838   $1,440,499      5.93
   Federal funds purchased and repurchase
          agreements                              16,434,208       84,986      2.07         10,718,634      109,131      4.07
   Note payable and Federal Home Loan
          Bank advances                            9,655,556      138,876      5.75          8,049,444      135,766      6.75
                                               ------------------------------------      --------------------------------------
                                                 148,347,791    1,302,110      3.51        116,012,916    1,685,396      5.81
   Noninterest-bearing deposits                    9,401,795                                 6,458,283
   Other liabilities                                 712,793                                   886,236
   Shareholders' Equity                            9,146,949                                 8,508,039
                                               -------------                             -------------
                                               $ 167,609,328                             $ 131,865,474
                                               =============                             =============
Net interest income                                            $ 1,252,730                               $ 952,642
                                                               ===========                               =========
Net interest spread on earning assets                                          2.87 %                                    2.60 %
                                                                               ====                                      ====

Net interest margin on earning assets                                          3.13 %                                    3.04 %
                                                                               ====                                      ====
</TABLE>

                                      -16-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

The net interest spread on average earning assets increased .27 to 2.87 since
March 31, 2001.The net interest margin improved 9 basis points from 3.04% at
March 31, 2001 to 3.13% at March 31, 2002. Year to date net interest income was
$1,252,730 compared to a figure of $952,642 for the same three months in 2001,
an increase of $300,088 or 32%. Interest income recorded for the first three
months was generated primarily from booking loans, purchasing securities, and
selling federal funds. Interest income through March 31, 2002 was $2,554,840
compared to $2,638,038 recorded for the same three month period in 2001. The net
decrease reflects 3% less interest income recorded so far in 2002 compared to
2001. The reduction is a direct result of an average difference in the Bank's
internal prime rate of approximately 3.87%. The average rate earned on
interest-earning assets was 6.38% at March 31, 2002 compared to 8.41% at March
31, 2001. This decrease of 203 basis points resulted primarily from the changes
in the Bank's internal prime rate mentioned above. All changes, no matter what
direction, to the Bank's internal prime rate affect interest earned on variable
rate loans and new loan volume. At March 31, 2002, 47% of the Bank's loan
portfolio was variable and average loans outstanding had increased $22,557,056
over the same period end one-year earlier. Additionally, interest expense
incurred on deposits, repurchase agreements, federal funds purchased, Federal
Home Loan Bank advances and Notes Payable decreased 23% for the quarter. This
category totaled $1,302,110 for the first three months of 2002 which was a
$383,286 reduction over the total recorded for the same period in 2001. The
favorable change in the net interest margin is directly attributable to the
Bank's success in securing a lower cost of funds in a declining rate
environment. The average rate paid on interest-bearing products was 230 basis
points less than what was paid a year earlier.

As the Bank's cost of funds declines and prime rate changes continue being a
possibility, asset liability management has become an important tool for
assessing and monitoring interest rate sensitivity. Management of interest rate
sensitivity attempts to avoid widely varying net interest margins and achieve
consistent net interest income through periods of changing interest rates. Asset
liability management aids the Company in achieving reasonable and predictable
earnings and liquidity while maintaining a balance between interest-earning
assets and interest-bearing liabilities. Liquidity management involves the
ability to meet the cash flow requirements of the Company's customers. These
customers may be either borrowers with credit needs or depositors wanting to
withdraw funds. Interest rate sensitivity varies with different types of earning
assets and interest-bearing liabilities. Overnight investments, on which rates
change daily, and loans tied to the prime rate, differ considerably from long
term investment securities and fixed rate loans. Time deposits over $100,000 and
money market accounts are more interest sensitive than regular savings accounts.
Comparison of the repricing intervals of interest-earning assets to
interest-bearing liabilities is a measure of interest sensitivity gap. Balancing
this gap is a continual challenge in a changing rate environment. The Company
uses a sophisticated computer program to perform analysis of interest rate risk,
assist with asset liability management, and model and measure interest rate
sensitivity.



                                      -17-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS


Details of the repricing gap at March 31, 2002 were:


<TABLE>
<CAPTION>
                                                              Interest rate sensitivity period
                                             Within         Three to          One to        After
                                             three           twelve            five         five
                                             months          months           years         years            Total
                                          --------------------------------------------------------------------------
<S>                                       <C>             <C>             <C>            <C>            <C>
Earning assets
   Interest-bearing deposits
        in other financial institutions   $     70,461    $          0    $          0   $          0   $     70,461
   Federal funds sold                        6,250,000               0               0              0      6,250,000
   Securities (including FHLB stock)        13,727,443       5,491,898      12,216,152      3,291,331     34,726,824
   Loans                                    67,664,438       7,229,982      47,187,570      2,578,247    124,660,237
                                          --------------------------------------------------------------------------
                                            87,712,342      12,721,880      59,403,722      5,869,578    165,707,522
Interest-bearing liabilities
   Savings and checking                     58,428,792               0               0              0     58,428,792
   Time deposits< $100,000                   4,096,492       8,407,611      19,612,368              0     32,116,471
   Time deposits>$100,000                    7,190,616      13,861,767      16,067,619              0     37,120,002
   Repurchase agreements and
        Federal funds purchased             17,556,381               0               0              0     17,556,381
   Notes payable and Federal Home
        Loan Bank advances                   7,500,000               0       2,000,000              0      9,500,000
                                          --------------------------------------------------------------------------
                                            94,772,281      22,269,378      37,679,987              0    154,721,646
Net asset (liability) repricing gap       $ (7,059,939)   $ (9,547,498)   $ 21,723,735   $  5,869,578   $ 10,985,876
                                          ==========================================================================
Cumulative net asset (liability)
        repricing gap                     $ (7,059,939)   $(16,607,437)   $  5,116,298   $ 10,985,876
                                          ===========================================================
</TABLE>


Currently the Bank has a negative repricing gap which indicates that the bank is
liability sensitive. This position implies that decreases to the national
federal funds rate would have more of an impact on interest expense than on
interest income if there were a parallel shift in rates. For instance if the
Bank's internal prime rate went down by 25 basis points and every interest
earning asset and interest bearing liability on the Bank's March 31, 2002
balance sheet adjusted simultaneously by the same 25 basis points, more
liabilities would be affected than assets. At this point in time it would not be
prudent to assume that future reductions in the Bank's internal prime could be
completely absorbed by reductions to the Bank's deposit rates. Some deposit
rates are reaching the bottom limit of what can be paid.

The provision for loan losses for the first quarter of 2002 was $127,800
compared to a figure of $101,500 for the same period in 2001. Management
believes that the allowance level is adequate and justifiable based on the
factors discussed earlier (see Financial Condition). Management will continue to
review the allowance with the intent of maintaining it at an appropriate level.
The provision may be increased or decreased in the future as management
continues to monitor the loan portfolio and actual loan loss experience.

Non-interest income recorded in the first quarter totaled $186,451 and
represented an increase of 12% over last year's first quarter. Although service
charge income appeared to remain




                                      -18-
<PAGE>
                        COMMUNITY SHORES BANK CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

relatively flat between 2002's first quarter and the similar quarter in 2001,
the small increase accounted for 10% of the overall increase in non-interest
income. Additionally, management believes that the service charge portion of
non-interest income will continue to increase in future quarters due to
anticipated growth in the number of deposit accounts. Improving as well were
mortgage loan referral fees. Fees earned for the first quarter ended March 31,
2002 were $9,382 more than the same period in 2001. Comparing the similar
quarter, fees of this type improved 26% over last year. It is difficult to
predict future contributions of mortgage loan referral fees to non-interest
income because of their dependence on interest rates, which are subject to
market forces. Other non-interest income consists of a variety of categories.
The ones showing the most dramatic improvement from last years first quarter to
this years were commissions on credit life insurance sold, debit card fee income
and credit card interchange income. The total increase amongst these were
roughly $6,000 or 31% of the improvement in non-interest income.

Non-interest expenses for the first three months of 2002 increased 13% over the
same period in 2001. The figure for the first quarter of 2002 was $1,145,710
compared to a total of $1,014,167 for the first three months of 2001. Salaries
and benefits comprised 47% of the first quarter increase. There were an
additional 6 full-time equivalent employees at March 31, 2002 compared to March
31, 2001. Occupancy and furniture and equipment expenses grew $9,155 (5%) for
the first three months of 2002 compared to the similar periods in 2001. An
increase in property taxes for the Bank's main office was mostly the cause of
this fluctuation. Advertising expense actually decreased by $7,809 from the
first quarter of 2002 compared to the first quarter of 2001. During last year's
first quarter the Bank incurred additional costs to announce the grand opening
of its North Muskegon location. As expected, data processing expenses have
increased as a result of the Bank's expanding customer base. This category has
grown 39% in the first three months of 2002 compared to the same period in 2001
and is responsible for 12% of the total increase in non-interest expenses so far
this year. Expenses of this nature are an unavoidable cost of doing business for
a financial institution. Professional services expense decreased by $13,390 when
comparing the first three months of 2002 with the similar period one year ago.
Legal expenses incurred by the Corporation have been lower in 2002 by $11,000.
The line item showing other non-interest expenses has increased $65,571 compared
to the similar quarter in 2001. In 2001, the Bank began paying its directors a
fee for attending scheduled Board and Committee meetings. By March 31, 2002, the
Bank had paid $13,900 in director's fees verses $5,700 being paid in 2001. The
change in this category accounts for 13% of the increase in other non-interest
expense. Another category of other non-interest expense that has increased is
correspondent bank service charges. An additional $7,786 has been paid through
March of 2002 compared to the first three months of 2001. Due to the general
growth of the Bank it is expected that the number of items processed on a daily
basis will proportionately increase and cause charges of this type to climb. In
the first three months of 2002 the Bank accrued State of Michigan Business Taxes
of $11,284 compared to none being accrued for the same time period in 2001. No
Federal Income Tax accruals were made for either the first quarter of 2002 or
that of 2001. Given the fact that the Corporation is now profitable the net
operating losses accumulated in the first years of operation are being used to
offset the tax liability on current profits. At this time it is estimated that
the net operating losses will continue offsetting income throughout 2002.



                                      -19-

<PAGE>
 PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

From time to time, the Company and the Bank may be involved in various legal
proceedings that are incidental to their business. In the opinion of management,
neither the Company nor the Bank is a party to any current legal proceedings
that are material to the financial condition of the Company or the Bank, either
individually or in the aggregate.

ITEM 2.  CHANGES IN SECURITIES

Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

Not applicable.

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

Not applicable.

ITEM 5.  OTHER INFORMATION

Not applicable.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)            Exhibits:


 EXHIBIT NO.                 EXHIBIT DESCRIPTION
 -----------                 -------------------

   3.1        Articles of Incorporation are incorporated by reference to exhibit
              3.1 of the Company's Registration Statement on Form SB-2
              (Commission File No. 333-63769) that became effective on December
              17, 1998.
   3.2        Bylaws of the Company are incorporated by reference to exhibit 3.2
              of the Company's Registration Statement on Form SB-2 (Commission
              File No. 333-63769) that became effective on December 17, 1998.
   3.3        First Amendment to the Bylaws of the Company dated December 19,
              2001.
   10.1       Subordinated Note Purchase Agreement between Community Shores LLC
              and Community Shores Bank Corporation dated February 25, 2002.
   10.2       Floating Rate Subordinated Note issued to Community Shores LLC by
              Community Shores Bank Corporation dated February 25, 2002.


                                      -20-
<PAGE>
(b)  Reports on Form 8-K.

         No reports on Form 8-K were filed during the quarter for which this
report is filed.


















































                                      -21-
<PAGE>
                                   SIGNATURES


In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized, on May 14, 2002.


                               COMMUNITY SHORES BANK CORPORATION



                               By:  /s/ Jose' A. Infante
                                  -------------------------------------
                               Jose' A. Infante
                               Chairman of the Board, President and Chief
                                Executive Officer (principal executive officer)



                               By:  /s/ Tracey A. Welsh
                                  -------------------------------------
                               Tracey A. Welsh
                               Chief Financial Officer and Vice President
                                (principal financial and accounting officer)









                                      -22-
<PAGE>
                                  EXHIBIT INDEX



EXHIBIT NO.    DESCRIPTION
-----------   ------------------

   3.1        Articles of Incorporation are incorporated by reference to exhibit
              3.1 of the Company's Registration Statement on Form SB-2
              (Commission File No. 333-63769) that became effective on December
              17, 1998.
   3.2        Bylaws of the Company are incorporated by reference to exhibit 3.2
              of the Company's Registration Statement on Form SB-2 (Commission
              File No. 333-63769) that became effective on December 17, 1998.
   3.3        First Amendment to the Bylaws of the Company dated December 19,
              2001.
   10.1       Subordinated Note Purchase Agreement between Community Shores LLC
              and Community Shores Bank Corporation dated February 25, 2002.
   10.2       Floating Rate Subordinated Note issued to Community Shores LLC by
              Community Shores Bank Corporation dated February 25, 2002.



                                      -23-