----

**UNITED        STATES**

**SECURITIES        AND EXCHANGE COMMISSION**

**Washington,        D.C.  20549**

**FORM        10-Q**

| x | Quarterly                  Report Pursuant to Section 13 or 15(d) of the Securities Exchange                  Act of                  1934                                                                                                                                             |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| o | Transition                  Report Pursuant to Section 13 or 15(d) of the Securities Exchange                  Act of                  1934 |
|---|---------------------------------------------------------------------------------------------------------------------------------------------|

|   | 0-22606 |
|--------|---------|

|   | Commission                  File Number: |
|--------|------------------------------------------|

|   | **BRITTON                  & KOONTZ CAPITAL                  CORPORATION** |
|--------|--------------------------------------------------------------------------------|

|   | (Exact                  name of Registrant as Specified in Its                  Charter) |
|--------|------------------------------------------------------------------------------------------|

|   | Mississippi                                                                          |   | 64-0665423                                               |   |
|--------|--------------------------------------------------------------------------------------|--------|----------------------------------------------------------|--------|
|   | (State                  or Other Jurisdiction of Incorporation or Organization  |   | (I.R.S.                  Employer Identification Number) |   |

|   | 500                  Main Street, Natchez,                  Mississippi  39120 |
|--------|------------------------------------------------------------------------------------------|

|   | (Address                  of Principal Executive Offices) (Zip                  Code) |
|--------|---------------------------------------------------------------------------------------|

|   | 601-445-5576 |
|--------|--------------|

|   | (Registrant’s                  Telephone Number, Including Area                  Code) |
|--------|----------------------------------------------------------------------------------------------|

|   | o | Large                  accelerated filer |   | o | Accelerated                  filer |   | x | Non-accelerated                  filer |
|--------|---|------------------------------------------|--------|---|------------------------------------|--------|---|----------------------------------------|

----

Table            of Contents

**BRITTON&KOONTZ        CAPITAL CORPORATION**

** AND          SUBSIDIARIES**

**INDEX**

| **PART                  I.**                                                                                                                                      | **FINANCIAL                  INFORMATION**                                                                                                                                  |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              | **Item                  1.    Financial                  Statements**                                                                                   |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              | Consolidated                  Statements of Financial                  Condition                                                                                            |
|                                                                                                                                                              | Consolidated                  Statements of Income                                                                                                                          |
|                                                                                                                                                              | Consolidated                  Statements of Changes in Stockholders'                  Equity                                                                                |
|                                                                                                                                                              | Consolidated                  Statements of Cash Flows                                                                                                                      |
|                                                                                                                                                              | Notes                  to the Consolidated Financial                  Statements                                                                                            |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              | **Item                  2.   Management’s Discussion and Analysis                  of Financial Condition and Results of                  Operations** |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              | **Item                  3.   Quantitative and Qualitative                  Disclosures About Market Risk**                                                   |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              | **Item                  4.  Controls and                  Procedures**                                                                                            |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              |                                                                                                                                                                        |
| **PART                  II.**                                                                                                                                     | **OTHER                  INFORMATION**                                                                                                                                      |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              | **Item                  1A.  Risk                  Factors**                                                                                                      |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              | **Item                  2.     Unregistered Sales of                  Equity Securities and Use of Proceeds**                                      |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              | **Item                  4.     Submission of Matters                  to a Vote of Security Holders**                                              |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              | **Item                  6.     Exhibits**                                                                                                          |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              |                                                                                                                                                                        |
| **SIGNATURES**                                                                                                                                                    |
|                                                                                                                                                              |                                                                                                                                                                        |
|                                                                                                                                                              |                                                                                                                                                                        |
| CERTIFICATION                OF CHIEF EXECUTIVE OFFICER AS REQUIRED                PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACTOF                2002        |
| CERTIFICATION                OF CHIEF FINANCIAL OFFICER AS REQUIRED                PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACTOF 2002                       |
| CERTIFICATION                  OF CHIEF EXECUTIVE OFFICER AS REQUIRED                  PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF                  2002 |
| CERTIFICATION                  OF CHIEF FINANCIAL OFFICER AS REQUIRED                  PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF                  2002 |

----

Table                of Contents

**PART        I                      FINANCIAL        INFORMATION**

**Item        1.                      Financial        Statements**

----

Table            of Contents

| **BRITTON&KOONTZ CAPITAL                CORPORATION AND                SUBSIDIARIES**   |   |
|--------------------------------------------------------------------------------------------------|--------|
| **CONSOLIDATED                STATEMENTS OF FINANCIAL CONDITION**                                |   |
| **FOR                THE PERIODS ENDED**                                                         |   |
|                                                                                             |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |
| **A                S S E T S**                                                                   |   |
|                                                                                             |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |
|                                                                                             |   | **June                30,** |   |   | **December                31,** |   |
| ** ASSETS:**                                                                                |   | **2007** |   |   | **2006** |   |
|  Cash                and due from banks:                                                    |   |   |   |   |   |   |
|  Non-interest                bearing                                                        |   | $ | 7,305,578 |   |   | $ | 6,254,364 |   |
|  Interest                bearing                                                            |   |   | 991,490 |   |   |   | 317,799 |   |
| **        Total                cash and due from banks** |   |   | 8,297,068 |   |   |   | 6,572,163 |   |
|                                                                                             |   |   |   |   |   |   |   |   |
|  Federal                funds sold                                                          |   |   | 139,682 |   |   |   | 304,569 |   |
|  Investment                Securities:                                                      |   |   |   |   |   |   |   |   |
|  Trading                (amortized cost, in 2007 and 2006,                                  |   |   |   |   |   |   |   |   |
|      of                $20,042,969 and $0, respectively                 |   |   | 19,592,440 |   |   |   | - |   |
| Available-for-sale                (amortized cost, in 2007 and 2006,                             |   |   |   |   |   |
|      of                $44,839,056 and $65,580,510, respectively)       |   |   | 43,706,218 |   |   |   | 64,419,428 |   |
| Held-to-maturity                (market value, in 2007 and 2006,                                 |   |   |   |   |   |
|      of                $37,762,653 and $39,015,853, respectively)       |   |   | 37,652,626 |   |   |   | 38,610,920 |   |
|  Equity                securities                                                           |   |   | 3,590,700 |   |   |   | 4,339,700 |   |
|  Loans,                less unearned income of $(54) in 2007 and                            |   |   |   |   |   |   |   |   |
| $122                in 2006, and allowance for loan losses of                                    |   |   |   |   |   |
|      $2,409,452                in 2007 and $2,344,434 in 2006           |   |   | 244,746,421 |   |   |   | 241,190,049 |   |
|  Loans                held for sale                                                         |   |   | - |   |   |   | 54,810 |   |
|  Bank                premises and equipment, net                                            |   |   | 7,596,224 |   |   |   | 7,719,278 |   |
|  Other                real estate                                                           |   |   | 1,026,574 |   |   |   | 1,256,611 |   |
|  Accrued                interest receivable                                                 |   |   | 2,341,950 |   |   |   | 2,437,387 |   |
|  Cash                surrender value of life insurance                                      |   |   | 995,530 |   |   |   | 973,212 |   |
|  Core                Deposit, net                                                           |   |   | 719,466 |   |   |   | 773,275 |   |
|  Other                assets                                                                |   |   | 1,116,262 |   |   |   | 666,839 |   |
|                                                                                             |   |   |   |   |   |   |   |   |
| ** TOTAL                ASSETS**                                                            |   | $ | 371,521,161 |   |   | $ | 369,318,241 |   |

----

Table            of Contents

| **LIABILITIES                AND STOCKHOLDERS' EQUITY**                                       |   |
|-----------------------------------------------------------------------------------------------|--------|
|                                                                                          |   |   |   |   |   |   |
|                                                                                          |   |   |   |   |   |   |
|                                                                                          |   | **June                30,** |   |   | **December                31,** |   |
| ** LIABILITIES:**                                                                        |   | **2007** |   |   | **2006** |   |
|  Deposits                                                                                |   |   |   |   |   |   |
|  Non-interest                bearing                                                     |   | $ | 46,241,886 |   |   | $ | 50,345,279 |   |
|  Interest                bearing                                                         |   |   | 212,905,012 |   |   |   | 203,411,996 |   |
| **        Total                deposits**             |   |   | 259,146,898 |   |   |   | 253,757,275 |   |
|                                                                                          |   |   |   |   |   |   |   |   |
|  Federal                Home Loan Bank advances                                          |   |   | 56,333,487 |   |   |   | 65,667,972 |   |
|  Securities                sold under repurchase agreements                              |   |   | 14,077,075 |   |   |   | 8,149,016 |   |
|  Accrued                interest payable                                                 |   |   | 2,236,671 |   |   |   | 1,786,288 |   |
|  Advances                from borrowers for taxes and insurance                          |   |   | 244,983 |   |   |   | 401,678 |   |
|  Accrued                taxes and other liabilities                                      |   |   | 858,022 |   |   |   | 804,124 |   |
|  Junior                subordinated debentures                                           |   |   | 5,155,000 |   |   |   | 5,155,000 |   |
| **        Total                liabilities**          |   |   | 338,052,136 |   |   |   | 335,721,353 |   |
|                                                                                          |   |   |   |   |   |   |   |   |
|                                                                                          |   |   |   |   |   |   |   |   |
|                                                                                          |   |   |   |   |   |   |   |   |
| ** STOCKHOLDERS'                EQUITY:**                                                |   |   |   |   |   |   |   |   |
|  Common                stock - $2.50 par value per share;                                |   |   |   |   |   |   |   |   |
|  12,000,000                shares authorized; 2,132,466 issued and                       |   |   |   |   |   |   |   |   |
|  2,117,966                outstanding, for June 30, 2007, and December 31, 2006          |   |   | 5,331,165 |   |   |   | 5,331,165 |   |
|  Additional                paid-in capital                                               |   |   | 7,298,103 |   |   |   | 7,295,235 |   |
|  Retained                earnings                                                        |   |   | 21,869,033 |   |   |   | 22,003,063 |   |
|  Accumulated                other comprehensive income                                   |   |   | (771,901 | ) |   |   | (775,200 | ) |
|                                                                                          |   |   | 33,726,400 |   |   |   | 33,854,263 |   |
|  Cost                of 14,500 shares of common stock held by the company                |   |   | (257,375 | ) |   |   | (257,375 | ) |
| **        Total                stockholders' equity** |   |   | 33,469,025 |   |   |   | 33,596,888 |   |
|                                                                                          |   |   |   |   |   |   |   |   |
| ** TOTAL                LIABILITIES AND STOCKHOLDERS' EQUITY**                           |   | $ | 371,521,161 |   |   | $ | 369,318,241 |   |

----

Table            of Contents

**BRITTON&KOONTZ CAPITAL        CORPORATION AND        SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF INCOME**

|                                                                         |   | **Three                Months Ended** |      |   | **Six                Months Ended** |   |
|------------------------------------------------------------------------------|--------|---------------------------------------|-----------|--------|-------------------------------------|--------|
|                                                                         |   | **June                30,**           |      |   | **June                30,**         |   |
|                                                                         |   | **2007**                              |      |   | **2006**                            |   |   | **2007** |   |   | **2006** |   |
| ** INTEREST                INCOME:**                                    |   |                                  |      |   |                                |   |   |   |   |   |   |   |
|  Interest                and fees on loans                              |   | $                                     | 4,899,367 |   |                                | $      | 4,487,117 |   |   | $ | 9,676,332 |   |   | $ | 8,825,562 |   |
|  Interest                on investment securities:                      |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
|      Taxable                interest income         |   |                                  | 970,233   |   |                                |   | 938,396 |   |   |   | 1,782,401 |   |   |   | 1,896,028 |   |
|      Exempt                from federal taxes       |   |                                  | 413,273   |   |                                |   | 409,527 |   |   |   | 828,003 |   |   |   | 818,101 |   |
|  Interest                on federal funds sold                          |   |                                  | 2,836     |   |                                |   | 9,313 |   |   |   | 6,080 |   |   |   | 21,333 |   |
|  Total                interest income                                   |   |                                  | 6,285,709 |   |                                |   | 5,844,353 |   |   |   | 12,292,816 |   |   |   | 11,561,024 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| ** INTEREST                EXPENSE:**                                   |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
|  Interest                on deposits                                    |   |                                  | 2,022,271 |   |                                |   | 1,566,428 |   |   |   | 3,869,166 |   |   |   | 3,006,576 |   |
|  Interest                on Federal Home Loan Bank advances             |   |                                  | 612,444   |   |                                |   | 697,148 |   |   |   | 1,319,526 |   |   |   | 1,414,093 |   |
|  Interest                on trust preferred securities                  |   |                                  | 107,357   |   |                                |   | 99,852 |   |   |   | 213,786 |   |   |   | 199,070 |   |
|  Interest                on securities sold under repurchase agreements |   |                                  | 113,824   |   |                                |   | 80,453 |   |   |   | 198,975 |   |   |   | 160,881 |   |
|  Total                interest expense                                  |   |                                  | 2,855,896 |   |                                |   | 2,443,881 |   |   |   | 5,601,453 |   |   |   | 4,780,620 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| ** NET                INTEREST INCOME**                                 |   |                                  | 3,429,813 |   |                                |   | 3,400,472 |   |   |   | 6,691,363 |   |   |   | 6,780,404 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
|  Provision                for loan losses                               |   |                                  | 120,000   |   |                                |   | 60,000 |   |   |   | 200,000 |   |   |   | 120,000 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| ** NET                INTEREST INCOME AFTER PROVISION**                 |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| ** FOR                LOAN LOSSES**                                     |   |                                  | 3,309,813 |   |                                |   | 3,340,472 |   |   |   | 6,491,363 |   |   |   | 6,660,404 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| ** OTHER                INCOME:**                                       |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
|  Service                charges on deposit accounts                     |   |                                  | 394,279   |   |                                |   | 345,435 |   |   |   | 788,476 |   |   |   | 672,783 |   |
|  Income                from fiduciary activities                        |   |                                  | 999       |   |                                |   | 10,383 |   |   |   | 1,998 |   |   |   | 19,741 |   |
|  Income                from investment activities                       |   |                                  | 45,654    |   |                                |   | 66,806 |   |   |   | 125,971 |   |   |   | 87,580 |   |
|  Gain/(loss)                on sale of ORE                              |   |                                  | (26,270   | )      |                                |   | - |   |   |   | (26,270 | ) |   |   | - |   |
|  Gain/(loss)                on sale of mortgage loans                   |   |                                  | 75,008    |   |                                |   | 54,721 |   |   |   | 124,632 |   |   |   | 139,869 |   |
|  Gain/(loss)                on sale of securities                       |   |                                  | -    |   |                                |   | - |   |   |   | (468,407 | ) |   |   | - |   |
|  Gain/(loss)                on mark to market trading securities        |   |                                  | (450,529  | )      |                                |   |  - |   |   |   | (450,529 | ) |   |   | - |   |
|  Other                                                                  |   |                                  | 121,351   |   |                                |   | 115,706 |   |   |   | 262,309 |   |   |   | 284,461 |   |
|  Total                other income                                      |   |                                  | 160,492   |   |                                |   | 593,051 |   |   |   | 358,180 |   |   |   | 1,204,434 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| ** OTHER                EXPENSES:**                                     |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
|  Salaries                                                               |   |                                  | 1,251,268 |   |                                |   | 1,303,630 |   |   |   | 2,520,053 |   |   |   | 2,575,296 |   |
|  Employee                benefits                                       |   |                                  | 189,896   |   |                                |   | 201,359 |   |   |   | 378,402 |   |   |   | 392,810 |   |
|  Director                fees                                           |   |                                  | 61,125    |   |                                |   | 53,480 |   |   |   | 105,925 |   |   |   | 100,825 |   |
|  Net                occupancy expense                                   |   |                                  | 246,478   |   |                                |   | 244,984 |   |   |   | 482,428 |   |   |   | 468,202 |   |
|  Equipment                expenses                                      |   |                                  | 280,789   |   |                                |   | 260,594 |   |   |   | 564,076 |   |   |   | 524,479 |   |
|  FDIC                assessment                                         |   |                                  | 7,715     |   |                                |   | 8,188 |   |   |   | 15,514 |   |   |   | 16,094 |   |
|  Advertising                                                            |   |                                  | 37,282    |   |                                |   | 62,088 |   |   |   | 80,176 |   |   |   | 116,545 |   |
|  Stationery                and supplies                                 |   |                                  | 40,778    |   |                                |   | 36,350 |   |   |   | 82,478 |   |   |   | 82,092 |   |
|  Audit                expense                                           |   |                                  | 63,132    |   |                                |   | 44,194 |   |   |   | 126,259 |   |   |   | 89,675 |   |
|  Other                real estate expense                               |   |                                  | 4,498     |   |                                |   | 18,070 |   |   |   | 183,701 |   |   |   | 44,459 |   |
|  Amortization                of deposit premium                         |   |                                  | 26,904    |   |                                |   | 26,904 |   |   |   | 53,808 |   |   |   | 53,808 |   |
|  Other                                                                  |   |                                  | 511,348   |   |                                |   | 516,166 |   |   |   | 1,047,137 |   |   |   | 1,001,020 |   |
|  Total                other expenses                                    |   |                                  | 2,721,213 |   |                                |   | 2,776,007 |   |   |   | 5,639,957 |   |   |   | 5,465,305 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| ** INCOME                BEFORE INCOME TAX EXPENSE**                    |   |                                  | 749,092   |   |                                |   | 1,157,516 |   |   |   | 1,209,586 |   |   |   | 2,399,533 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
|  Income                tax expense                                      |   |                                  | 135,793   |   |                                |   | 282,060 |   |   |   | 169,159 |   |   |   | 598,685 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| ** NET                INCOME**                                          |   | $                                     | 613,299   |   |                                | $      | 875,456 |   |   | $ | 1,040,427 |   |   | $ | 1,800,848 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| ** EARNINGS                PER SHARE DATA:**                            |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
|  Basic                earnings per share                                |   | $                                     | 0.29      |   |                                | $      | 0.41 |   |   | $ | 0.49 |   |   | $ | 0.85 |   |
|  Basic                weighted shares outstanding                       |   |                                  | 2,117,966 |   |                                |   | 2,117,376 |   |   |   | 2,117,966 |   |   |   | 2,117,084 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |
|  Diluted                earnings per share                              |   | $                                     | 0.29      |   |                                | $      | 0.41 |   |   | $ | 0.49 |   |   | $ | 0.85 |   |
|  Diluted                weighted shares outstanding                     |   |                                  | 2,120,158 |   |                                |   | 2,121,382 |   |   |   | 2,120,330 |   |   |   | 2,122,033 |   |
|                                                                         |   |                                  |      |   |                                |   |   |   |   |   |   |   |   |   |   |   |

----

Table            of Contents

| **BRITTON&KOONTZ CAPITAL                  CORPORATION AND                  SUBSIDIARIES**     |   |
|--------------------------------------------------------------------------------------------------------|--------|
| **CONSOLIDATED                  STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY**                        |   |
| **FOR                  THE SIX MONTHS ENDED JUNE 30, 2007 AND 2006**                                   |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   | Accumulated |   |   |   |   |   |   |   |
|                                                                                                   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Other |   |   |   |   |   | Total |   |
|                                                                                                   |   | Common                  Stock |   |   | Paid-in |   |   | Retained |   |   | Comprehensive |   |   | Treasury |   |   | Stockholders' |   |
|                                                                                                   |   | Shares |   |   | Amount |   |   | Capital |   |   | Earnings |   |   | Income |   |   | Stock |   |   | Equity |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Balance                  at December 31, 2005                                                    |   |   | 2,116,316 |   |   | $ | 5,327,040 |   |   | $ | 7,254,113 |   |   | $ | 19,949,100 |   |   | $ | (1,012,720 | ) |   | $ | (257,375 | ) |   | $ | 31,260,158 |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Comprehensive                  Income:                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Net                  income                                              |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 1,800,848 |   |   |   | - |   |   |   |   |   |   |   | 1,800,848 |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Other                  comprehensive                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         income                  (net of tax):                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Net                  change in unrealized gain/(loss)                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         on                  securities available for sale, net |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         of                  taxes for $410,999                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (690,874 | ) |   |   |   |   |   |   | (690,874 | ) |
|  Other                  Comprehensive gains from                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         derivatives,                  net of reclassification  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         adjustment                  of $12,700                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (21,349 | ) |   |   |   |   |   |   | (21,349 | ) |
|  Total                  Comprehensive Income                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 1,088,625 |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Cash                  Dividend paid $0.36 per share                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (762,152 | ) |   |   |   |   |   |   |   |   |   |   | (762,152 | ) |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Stock                  Options exercised                                                         |   |   | 1,650 |   |   |   | 4,125 |   |   |   | 36,255 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 40,380 |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Balance                  at June 30, 2006                                                        |   |   | 2,117,966 |   |   | $ | 5,331,165 |   |   | $ | 7,290,368 |   |   | $ | 20,987,796 |   |   | $ | (1,724,943 | ) |   | $ | (257,375 | ) |   | $ | 31,627,011 |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Balance                  at December 31, 2006                                                    |   |   | 2,117,966 |   |   | $ | 5,331,165 |   |   | $ | 7,295,235 |   |   | $ | 22,003,063 |   |   | $ | (775,200 | ) |   | $ | (257,375 | ) |   | $ | 33,596,888 |   |
|  Adjustment                  to opening balance, net of tax, for the                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  adoption                  of SFAS No. 159                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (411,989 | ) |   |   |   |   |   |   |   |   |   |   | (411,989 | ) |
|  Adjusted                  opening balance, January 1, 2007                                       |   |   |   |   |   |   |   |   |   |   |   |   |   | $ | 21,591,074 |   |   |   |   |   |   |   |   |   |   | $ | 33,184,899 |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Comprehensive                  Income:                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Net                  income                                              |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 1,040,427 |   |   |   | - |   |   |   |   |   |   |   | 1,040,427 |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Other                  comprehensive                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         income                  (net of tax):                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Net                  change in unrealized gain/(loss)                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         on                  securities available for sale, net |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         of                  taxes of $10,534                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 17,708 |   |   |   |   |   |   |   | 17,708 |   |
|  Other                  Comprehensive gains from                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         derivatives,                  net of reclassification  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         adjustment                  of $8,572                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (14,409 | ) |   |   |   |   |   |   | (14,409 | ) |
|  Total                  Comprehensive Income                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 1,043,726 |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Cash                  Dividend paid $0.36 per share                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (762,468 | ) |   |   |   |   |   |   |   |   |   |   | (762,468 | ) |
|  Fair                  value unexercised stock options                                            |   |   |   |   |   |   |   |   |   |   | 2,868 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 2,868 |   |
|                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Balance                  at June 30, 2007                                                        |   |   | 2,117,966 |   |   | $ | 5,331,165 |   |   | $ | 7,298,103 |   |   | $ | 21,869,033 |   |   | $ | (771,901 | ) |   | $ | (257,375 | ) |   | $ | 33,469,025 |   |

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Table            of Contents

| **BRITTON&KOONTZ CAPITAL                CORPORATION AND                SUBSIDIARIES**                                                                |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| **CONSOLIDATED                STATEMENTS OF CASH FLOWS**                                                                                                      |   |
| **PERIODS                ENDED JUNE 30,**                                                                                                                     |   |
|                                                                                                                                                          |   |   |   |   |   |   |
|                                                                                                                                                          |   | **2007** |   |   | **2006** |   |
| ** CASH                FLOWS FROM OPERATING ACTIVITIES**                                                                                                 |   |   |   |   |   |   |
|  Net                income                                                                                                                               |   | $ | 1,040,427 |   |   | $ | 1,800,848 |   |
|                          Adjustments to reconcile net income to net cash                                         |   |   |   |   |   |   |   |   |
|                               provided by (used in) operating activities:               |   |   |   |   |   |   |   |   |
|                           Deferred income taxes                                                             |   |   | (187,185 | ) |   |   | (238,635 | ) |
|            Provision                for loan losses                                                    |   |   | 200,000 |   |   |   | 120,000 |   |
|                           Provision for depreciation                                                        |   |   | 391,290 |   |   |   | 389,931 |   |
|            Stock                dividends received                                                     |   |   | (92,800 | ) |   |   | (95,600 | ) |
|                          (Gain)/loss on sale of other real estate                                                |   |   | 26,270 |   |   |   | (3,323 | ) |
|                          (Gain)/loss on sale of mortgage loans                                                   |   |   | (124,632 | ) |   |   | (139,869 | ) |
|                          (Gain)/loss on sale of investment securities                                            |   |   | 558,770 |   |   |   | - |   |
|                          (Gain)/loss on valuation of trading securities                                          |   |   | 360,166 |   |   |   | - |   |
|                           Net amortization (accretion) of securities                                        |   |   | (13,136 | ) |   |   | 82,593 |   |
|                           Amortization of deposit premium                                                   |   |   | 53,808 |   |   |   | 53,808 |   |
|                           Writedown of other real estate                                                    |   |   | 211,958 |   |   |   | 22,178 |   |
|                           Writedown of other repossessed assets                                             |   |   | 15,000 |   |   |   | - |   |
|  Net                change in:                                                                                                                           |   |   |   |   |   |   |   |   |
|                     Purchase of trading securities                                                                              |   |   | (21,171,178 | ) |   |   | - |   |
|                Proceeds              from sales, maturities and paydowns           |   |   |   |   |   |   |   |   |
|                    of              trading securities          |   |   | 806,484 |   |   |   | - |   |
|                            Loans held for sale                                                         |   |   | 54,810 |   |   |   | 112,229 |   |
|                            Accrued interest receivable                                                 |   |   | 95,437 |   |   |   | (3,793 | ) |
|                            Cash surrender value                                                        |   |   | (22,318 | ) |   |   | (20,046 | ) |
|                            Other assets                                                                |   |   | (300,093 | ) |   |   | (47,155 | ) |
|                            Accrued interest payable                                                    |   |   | 450,383 |   |   |   | 391,512 |   |
|             Accrued                taxes and other liabilities                                    |   |   | 51,811 |   |   |   | (394,112 | ) |
|                                                                                                                                                          |   |   |   |   |   |   |   |   |
|                              Net cash provided by (used in) operating activities             |   |   | (17,594,728 | ) |   |   | 2,030,566 |   |
|                                                                                                                                                          |   |   |   |   |   |   |   |   |
| ** CASH                FLOWS FROM INVESTING ACTIVITIES**                                                                                                 |   |   |   |   |   |   |   |   |
|                            (Increase)/decrease in federal funds sold                                   |   |   | 164,886 |   |   |   | 398,688 |   |
|                            Proceeds from sales, maturities and paydowns of                securities:  |   |   |   |   |   |   |   |   |
|                            Available-for-sale                                                               |   |   | 57,574,695 |   |   |   | 7,599,210 |   |
|                            Held-to-maturity                                                            |   |   | 5,596,041 |   |   |   | 548,412 |   |
|                            Redemption of FHLB stock                                                    |   |   | 841,800 |   |   |   | 1,044,000 |   |
|                            Purchases of securities:                                                    |   |   |   |   |   |   |   |   |
|                            Available-for-sale                                                               |   |   | (37,376,524 | ) |   |   | (302,953 | ) |
|                            Held-to-maturity                                                            |   |   | (4,640,000 | ) |   |   | (309,929 | ) |
|                            (Increase)/decrease in loans                                                |   |   | (4,006,781 | ) |   |   | 1,981,361 |   |
|                            Proceeds from sale and transfers of other real                estate        |   |   | 362,850 |   |   |   | 34,401 |   |
|                            Proceeds from sale and transfers of other repossessed                assets |   |   | 4,000 |   |   |   | 4,500 |   |
|                            Purchase of premises and equipment                                          |   |   | (268,236 | ) |   |   | (305,257 | ) |
|                                                                                                                                                          |   |   |   |   |   |   |   |   |
|              Net                cash provided by (used in) investing activities              |   |   | 18,252,731 |   |   |   | 10,692,433 |   |

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| **BRITTON                & KOONTZ CAPITAL CORPORATION AND                SUBSIDIARIES** |   |
|--------------------------------------------------------------------------------------------------|--------|
| **CONSOLIDATED                STATEMENTS OF CASH FLOWS**                                         |   |
| **PERIODS                ENDED JUNE 30,**                                                        |   |
| (continued)                                                                                 |   |

|                                                                              |   | **2007** |       |   | **2006** |   |
|-----------------------------------------------------------------------------------|--------|----------|------------|--------|----------|--------|
| ** CASH                  FLOWS FROM FINANCING ACTIVITIES**                   |   |     |       |   |     |   |
|  Increase                  /(decrease) in customer deposits                  |   |     | (4,499,650 | )      |     |   | 6,112,286 |   |
|  Increase                  /(decrease) in brokered deposits                  |   |     | 9,889,273  |   |     |   | 581,879 |   |
|  Increase                  /(decrease) in securities sold under              |   |     |       |   |     |   |   |   |
|  repurchase                  agreements                                      |   |     | 5,928,059  |   |     |   | (1,315,393 | ) |
|  Increase                  /(decrease) in FHLB advances                      |   |     | (9,334,485 | )      |     |   | (17,739,354 | ) |
|  Increase                  /(decrease) in advances from borrowers            |   |     |       |   |     |   |   |   |
|                    for taxes and insurance                                   |   |     | (156,695   | )      |     |   | (159,994 | ) |
|  Cash                  dividends paid                                        |   |     | (762,468   | )      |     |   | (762,152 | ) |
|  Common                  stock issued                                        |   |     | 2,868      |   |     |   | 40,380 |   |
|                                                                              |   |     |       |   |     |   |   |   |
|  Net                  cash provided by (used in) financing activities        |   |     | 1,066,902  |   |     |   | (13,242,348 | ) |
|                                                                              |   |     |       |   |     |   |   |   |
| ** NET                  INCREASE/(DECREASE) IN CASH AND DUE FROM BANKS**     |   |     | 1,724,905  |   |     |   | (519,350 | ) |
|                                                                              |   |     |       |   |     |   |   |   |
| ** CASH                  AND DUE FROM BANKS AT BEGINNING OF PERIOD**         |   |     | 6,572,163  |   |     |   | 9,825,459 |   |
|                                                                              |   |     |       |   |     |   |   |   |
| ** CASH                  AND DUE FROM BANKS AT END OF PERIOD**               |   | $        | 8,297,068  |   |     | $      | 9,306,109 |   |
|                                                                              |   |     |       |   |     |   |   |   |
| ** SUPPLEMENTAL                  DISCLOSURES OF CASH FLOW**                  |   |     |       |   |          |   |
| ** INFORMATION:**                                                            |   |     |       |   |     |   |   |   |
|                                                                              |   |     |       |   |     |   |   |   |
|  Cash                  paid during the year for interest                     |   | $        | 5,151,070  |   |     | $      | 4,389,108 |   |
|  Cash                  paid during the year for income taxes                 |   | $        | 266,928    |   |     | $      | 1,051,298 |   |
|                                                                              |   |     |       |   |     |   |   |   |
| ** SCHEDULE                  OF NONCASH INVESTING AND**                      |   |     |       |   |     |   |   |   |
| ** FINANCING                  ACTIVITIES:**                                  |   |     |       |   |     |   |   |   |
|                                                                              |   |     |       |   |     |   |   |   |
|   Transfers                  from loans foreclosed to other real estate |   | $        | -          |   |     | $      | 78,078 |   |
|                                                                              |   |     |       |   |     |   |   |   |
|  Change                  in unrealized gains (losses)                        |   |     |       |   |     |   |   |   |
|   on                  securities available for sale                     |   | $        | 28,242     |   |     | $      | (1,101,874 | ) |
|                                                                              |   |     |       |   |     |   |   |   |
|  Change                  in the deferred tax effect in unrealized            |   |     |       |   |     |   |   |   |
|   gains                  (losses) on securities available for sale      |   | $        | 10,534     |   |     | $      | (410,999 | ) |
|                                                                              |   |     |       |   |     |   |   |   |
|  Change                  in unrealized gains (losses) on derivative          |   | $        | (22,981    | )      |     | $      | (34,049 | ) |
|                                                                              |   |     |       |   |     |   |   |   |
|  Change                  in the deferred tax effect in                       |   |     |       |   |     |   |   |   |
|  unrealized                  gains (losses) on derivative                    |   | $        | (8,572     | )      |     | $      | (12,700 | ) |

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Table            of Contents

**BRITTON&KOONTZ      CAPITAL CORPORATION AND      SUBSIDIARIES**

**NOTES      TO THE CONSOLIDATED FINANCIAL STATEMENTS**

**JUNE        30, 2007 AND DECEMBER 31, 2006**

**Note      A.  Basis of Presentation**

**Note      B.  Interest Rate Risk Management**

**Note      C.  Loans Held-for-Sale**

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Table          of Contents

**Note      D.  Junior Subordinated Debentures**

**Note      E.  Loan Commitments**

**Note      F.  Earnings per Share**

|                                                       |   | For                  the three months endedJune                  30, |      |
|------------------------------------------------------------|--------|----------------------------------------------------------------------|-----------|
|                                                       |   | 2007                                                                 |      |   | 2006 |   |
| Basic                weighted average shares outstanding   |   |                                                                 | 2,117,966 |   |   |   | 2,117,376 |   |
| Dilutive                effect of granted options          |   |                                                                 | 2,192     |   |   |   | 4,006 |   |
|                                                       |   |                                                                 |      |   |   |   |   |   |
| Diluted                weighted average shares outstanding |   |                                                                 | 2,120,158 |   |   |   | 2,121,382 |   |
| Net                income                                  |   | $                                                                    | 613,299   |   |   | $ | 875,456 |   |
| Net                income per share-basic                  |   | $                                                                    | 0.29      |   |   | $ | 0.41 |   |
| Net                income per share-diluted                |   | $                                                                    | 0.29      |   |   | $ | 0.41 |   |

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Table          of Contents

|                                                       |   | For                  the six months endedJune                  30, |      |
|------------------------------------------------------------|--------|--------------------------------------------------------------------|-----------|
|                                                       |   | 2007                                                               |      |   | 2006 |   |
| Basic                weighted average shares outstanding   |   |                                                               | 2,117,966 |   |   |   | 2,117,084 |   |
| Dilutive                effect of granted options          |   |                                                               | 2,364     |   |   |   | 4,948 |   |
|                                                       |   |                                                               |      |   |   |   |   |   |
| Diluted                weighted average shares outstanding |   |                                                               | 2,120,330 |   |   |   | 2,122,033 |   |
| Net                income                                  |   | $                                                                  | 1,040,427 |   |   | $ | 1,800,848 |   |
| Net                income per share-basic                  |   | $                                                                  | 0.49      |   |   | $ | 0.85 |   |
| Net                income per share-diluted                |   | $                                                                  | 0.49      |   |   | $ | 0.85 |   |

**Item      2. Management’s Discussion and Analysis of Financial Condition      and Results of Operations**

**SUMMARY**

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Table          of Contents

**Financial      Condition**

**Assets**

** **

**Investment      Securities**

**TABLE      1: COMPOSITION OF      INVESTMENT PORTFOLIO **

**(**

*Amortized      Cost*

**)**

|                                                                                |   | 06/30/07     |        |   | 12/31/06 |   |
|-------------------------------------------------------------------------------------|--------|--------------|-------------|--------|----------|--------|
| Mortgage-Backed                Securities                                           |   | $            | 67,063,980  |   |     | $      | 61,518,891 |   |
| Agencies                Obligations                                                 |   |         | -           |   |     |   | 6,496,959 |   |
| Obligations                of State and                                             |   |         |        |   |     |   |   |   |
| Political                Subdivisions                                               |   | *** *** | 35,470,671  |   |     |   | 36,175,580 |   |
|              Total |   | $            | 102,534,651 |   |     | $      | 104,191,430 |   |

----

Table          of Contents

**Loans**

**TABLE      2: COMPOSITION OF LOAN PORTFOLIO *(including loans held for      sale)***

|                                                    |   | 06/30/07 |        |   | 12/31/06 |   |
|---------------------------------------------------------|--------|----------|-------------|--------|----------|--------|
| Commercial,                financial & agricultural |   | $        | 28,747,000  |   |     | $      | 32,868,000 |   |
| Real                estate-construction                 |   |     | 50,918,000  |   |     |   | 30,069,000 |   |
| Real                estate-1-4 family residential       |   |     | 71,124,000  |   |     |   | 94,126,000 |   |
| Real                estate-other                        |   |     | 87,474,000  |   |     |   | 75,237,000 |   |
| Installment                                             |   |     | 8,747,000   |   |     |   | 12,478,000 |   |
| Other                                                   |   |     | 146,000     |   |     |   | 306,000 |   |
| Total                loans                              |   | $        | 247,156,000 |   |     | $      | 245,084,000 |   |

**Bank      Premises**

**Asset      Quality**

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Table          of Contents

**TABLE      3: BREAKDOWN OF NONPERFORMING ASSETS**

|                                                                                                                                     |   | 06/30/07                              |   |   | 12/31/06 |   |
|------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|--------|--------|----------|--------|
|                                                                                                                                     |   | (dollars                in thousands) |   |
| Non-accrual                loans by type:                                                                                                |   |                                  |   |   |     |   |
| Real                estate                                                                                                               |   | $                                     | 1,313  |   |     | $      | 829 |   |
| Installment                                                                                                                              |   |                                  | 54     |   |     |   | 13 |   |
| Commercial                and all other loans                                                                                            |   |                                  | 308    |   |     |   | 351 |   |
| Total                non-accrual loans                                                                                                   |   |                                  | 1,675  |   |     |   | 1,193 |   |
| Loans                past due 90 days or more                                                                                            |   |                                  | 772    |   |     |   | 232 |   |
| Total                nonperforming loans                                                                                                 |   |                                  | 2,447  |   |     |   | 1,425 |   |
| Other                real estate owned (net)                                                                                             |   |                                  | 1,027  |   |     |   | 1,257 |   |
| Total                nonperforming assets                                                                                                |   | $                                     | 3,474  |   |     | $      | 2,682 |   |
| Nonperforming                loans as a percent of loans, net of unearned interest and loans held                for                sale |   |                                  | .99    | %      |     |   | .59 | % |

**Allowance      for Possible Loan      Losses**

**              Provision      for Possible Loan Losses**

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**TABLE      4: ACTIVITY OF ALLOWANCE FOR POSSIBLE LOAN LOSSES**

|                                                                                                                              |   | 06/30/07                              |   |   | 06/30/06 |   |
|-----------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|--------|--------|----------|--------|
|                                                                                                                              |   | (dollars                in thousands) |   |
| Balance                at beginning of period                                                                                     |   | $                                     | 2,344  |   |     | $      | 2,378 |   |
| Charge-offs:                                                                                                                      |   |                                  |   |   |     |   |   |   |
| Real                Estate                                                                                                        |   |                                  | (75    | )      |     |   | (8 | ) |
| Commercial                                                                                                                        |   |                                  | (74    | )      |     |   | (16 | ) |
| Installment                and other                                                                                              |   |                                  | (40    | )      |     |   | (40 | ) |
| Recoveries:                                                                                                                       |   |                                  |   |   |     |   |   |   |
| Real                Estate                                                                                                        |   |                                  | 1      |   |     |   | 22 |   |
| Commercial                                                                                                                        |   |                                  | 23     |   |     |   | 7 |   |
| Installment                and other                                                                                              |   |                                  | 30     |   |     |   | 8 |   |
| Net                (charge-offs)/recoveries                                                                                       |   |                                  | (135   | )      |     |   | (27 | ) |
| Provision                charged to operations                                                                                    |   |                                  | 200    |   |     |   | 120 |   |
| Balance                at end of period                                                                                           |   | $                                     | 2,409  |   |     | $      | 2,471 |   |
| Allowance                for loan losses as a percent of loans, net of unearned interest &                loans held for sale |   |                                  | .97    | %      |     |   | 1.02 | % |
| Net                charge-offs as a percent of average loans                                                                      |   |                                  | .05    | %      |     |   | .02 | % |

**Potential      Problem      Loans**

**Deposits**

**TABLE      5: COMPOSITION OF DEPOSITS**

|                                         |   | 06/30/07 |        |   | 12/31/06 |   |
|----------------------------------------------|--------|----------|-------------|--------|----------|--------|
| Non-Interest                Bearing          |   | $        | 46,241,886  |   |     | $      | 50,345,279 |   |
| NOW                Accounts                  |   |     | 25,029,880  |   |     |   | 24,555,009 |   |
| Money                Market Deposit Accounts |   |     | 35,620,143  |   |     |   | 37,101,457 |   |
| Savings                Accounts              |   |     | 18,859,238  |   |     |   | 18,082,839 |   |
| Certificates                of Deposit       |   |     | 133,395,751 |   |     |   | 123,672,691 |   |
| Total                Deposits                |   | $        | 259,146,898 |   |     | $      | 253,757,275 |   |

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**Borrowings**

**Capital**

**Off-Balance      Sheet      Arrangements**

**Results      of Operations**

**Net      Income**

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**Net      Interest Income and Net Interest      Margin**

**Non-Interest      Income**

**Non-Interest      Expense**

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**Income      Taxes**

**Liquidity      and Capital Resources**

** **

**Contractual      Obligations**

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**DISCLOSURE      REGARDING FORWARD-LOOKING STATEMENTS**

**Item        3.      **Quantitative        and Qualitative Disclosures About Market        Risk****

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**Item      4.      Controls and      Procedures**

**PART      II.  OTHER INFORMATION**

**Item      1A.  Risk Factors**

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

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

|   **Nominee**                        | **Number                  of Votes Cast “FOR”****Nominee** |  **Number                  of Votes****Withheld** |
|------------------------------------------------|------------------------------------------------------------------------|--------------------------------------------------------|
| **W.                  W. Allen, Jr.**          | **1,420,563**                                                          | **217,136**                                            |
| **Craig                  A. Bradford, D.M.D.** | **1,420,563**                                                          | **217,136**                                            |
| **Vinod                  K. Thukral, Ph.D.**   | **1,420,563**                                                          | **217,136**                                            |

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| **For**     | **Against** | **Abstain** | **Broker****Non-Votes**  |
|-------------|-------------|-------------|-------------------------------|
| **919,267** | **251,654** | **22,934**  | **443,843**                   |

| **Item                6.** | **Exhibits** |
|----------------------------|--------------|

| Exhibit |   | Description                of Exhibit                                                                                                                                                                                                                                                                                                                                                                                                             |
|---------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 3.1     | *      | Restated                Articles of Incorporation of Britton & Koontz Capital Corporation, as                amended, incorporated by reference to Exhibit 3.1 to Registrant’s                Quarterly Report on Form 10-Q filed with the Securities and Exchange                Commission on August 4, 2006.                                                                                                                         |
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 3.2     | *      | By-Laws                of Britton & Koontz Capital Corporation, as amended and restated,                incorporated by reference to Exhibit 3.2 to Registrant’s Quarterly Report                on Form 10-Q filed with the Securities and Exchange Commission on                November                14, 2007.                                                                                                                     |
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 4.1     | *      | Shareholder                Rights Agreement dated June 1, 1996, between Britton & Koontz Capital                Corporation and Britton & Koontz First National Bank, as Rights Agent,                incorporated by reference to Exhibit 4.3 to Registrant’s Registration                Statement on Form S-8, Registration No. 333-20631, filed with the                Securities and Exchange Commission on January 29, 1997. |
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 4.2     | *      | Amendment                No. 1 to Rights Agreement dated as of August 15, 2006, by and between                Britton & Koontz Capital Corporation and Britton & Koontz Bank,                N.A., incorporated by reference to Exhibit 4.2 to Registrant’s Current                Report on Form 8-K filed with the Securities and Exchange Commission                on                August 17, 2006.                           |
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.1    | *      | Britton                & Koontz Capital Corporation 2007 Long-Term Incentive Compensation                Plan, incorporated by reference to Appendix B to Registrant’s Definitive                Proxy Statement filed with the Securities and Exchange Commission                on March                21, 2007.                                                                                                                     |
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 31.1    |   | Certifications                of the Chief Executive Officer, as required pursuant to Section 302                of the                Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                 |
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 31.2    |   | Certifications                of the Chief Financial Officer, as required pursuant to Section 302                of the                Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                 |
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 32.1    |   | Certifications                of the Chief Executive Officer, as required pursuant to Section 906                of the                Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                 |
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 32.2    |   | Certifications                of the Chief Financial Officer, as required pursuant to Section 906                of the                Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                 |

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**SIGNATURES**

| Date:  | August                13, 2007 | /s/              W. Page Ogden    |
|--------|--------------------------------|----------------------------------------|
|   |                           | W.                Page Ogden           |
|   |                           | Chief                Executive Officer |

| Date:  | August                13, 2007 | /s/              William M. Salters  |
|--------|--------------------------------|-------------------------------------------|
|   |                           | William                M. Salters         |
|   |                           | Chief                Financial Officer    |

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**EXHIBIT      INDEX**

| Exhibit | Description                of Exhibit                                                                                                                             |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|    |                                                                                                                                                              |
| 31.1    | Certifications                of the Chief Executive Officer, as required pursuant to Section 302                of the                Sarbanes-Oxley Act of 2002 |
|    |                                                                                                                                                              |
| 31.2    | Certifications                of the Chief Financial Officer, as required pursuant to Section 302                of the                Sarbanes-Oxley Act of 2002 |
|    |                                                                                                                                                              |
| 32.1    | Certifications                of the Chief Executive Officer, as required pursuant to Section 906                of the                Sarbanes-Oxley Act of 2002 |
|    |                                                                                                                                                              |
| 32.2    | Certifications                of the Chief Financial Officer, as required pursuant to Section 906                of the                Sarbanes-Oxley Act of 2002 |