<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

[x]      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2000

[ ]      TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

For the transition period from _____________to________________

Commission file Number:  0-19028

                               CCFNB BANCORP, INC.
                 (Name of small business issuer in its charter)

<TABLE>
<CAPTION>
<S>                                                                             <C>
PENNSYLVANIA                                                                    23-2254643
(State or other jurisdiction of                                                (I.R.S. Employer
incorporation or organization)                                                  Identification Number)

232 East Street, Bloomsburg, Pennsylvania                                       17815
(Address of principal executive offices)                                       (Zip Code)
</TABLE>

Registrant's telephone number, including area code:  (570) 784-4400

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

Securities registered pursuant to Section 12(g) of the Act: Common Stock, par
value $1.25 per share.

                  Indicate by check mark whether the Registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the past 12 months (or for such shorter period that
the Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No______

                  Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. [X]

                  The aggregate market value of the voting and non-voting equity
held by non-affiliates of the Registrant based on the average of the bid and
asked prices of $16.88 at February 28, 2001, was $22,681,791.

                  As of February 28, 2001, the Registrant had outstanding
1,343,708 shares of its common stock, par value $1.25 per share.

                       DOCUMENTS INCORPORATED BY REFERENCE

                  In addition, portions of the Annual Report to stockholders of
the Registrant for the year ended December 31, 2000, are incorporated by
reference in Part II of this Annual Report.

                                  Page ii of 70
                            Exhibit Index on Page 28
<PAGE>   2
                               CCFNB BANCORP, INC.
                                    FORM 10-K

                                      INDEX

<TABLE>
<CAPTION>
Part I                                                                                                          Page

<S>          <C>                                                                                                <C>
Item 1.      Business.............................................................................................1
Item 2.      Properties..........................................................................................17
Item 3.      Legal Proceedings...................................................................................17
Item 4.      Submission of Matters to a Vote of Security Holders.................................Not Applicable

Part II

Item 5.      Market for the Registrant's Common Equity and Related Stockholder Matters...........................17
Item 6.      Selected Financial Data.............................................................................18
Item 7.      Management's Discussion and Analysis of Financial Condition and Results of Operations...............18
Item 7A.     Quantitative and Qualitative Disclosures about Market Risk..........................................18
Item 8.      Financial Statements and Supplementary Data.........................................................18
Item 9.      Changes in and Disagreements with Accountants on Accounting and Financial
              Disclosure.........................................................................Not Applicable

Part III

Item 10.     Directors and Executive Officers of the Registrant..................................................18
Item 11.     Executive Compensation..............................................................................20
Item 12.     Security Ownership of Certain Beneficial Owners and Management......................................24
Item 13.     Certain Relationships and Related Transactions......................................................24
Item 14.     Exhibits, Financial Statement Schedules and Reports on Form 8-K.....................................25

SIGNATURES.......................................................................................................25

INDEX TO EXHIBITS................................................................................................28
</TABLE>

                                       i
<PAGE>   3
                               CCFNB BANCORP, INC.
                                    FORM 10-K

PART I

ITEM 1.  BUSINESS

GENERAL

We are a registered bank holding company and Pennsylvania business corporation
and are headquartered in Bloomsburg, Pennsylvania. We have one wholly-owned
subsidiary which is Columbia County Farmers National Bank or referred to as the
Bank. Our business consists of the management and supervision of the Bank. Our
principal source of income is dividends paid by the Bank. At December 31, 2000,
we had approximately:

         -        $203 million in total assets;

         -        $137 million in loans;

         -        $143 million in deposits; and

         -        $25 million in stockholders' equity.

The Bank is a national banking association and member of the Federal Reserve
System whose deposits are insured by the Bank Insurance Fund of the FDIC. The
Bank is a full-service commercial bank providing a range of services and
products, including time and demand deposit accounts, consumer, commercial and
mortgage loans to individuals and small to medium-sized business in its
Northcentral Pennsylvania market area. The Bank operates also a full-service
trust department. At December 31, 2000, the Bank had six branch banking offices
which are located in the Pennsylvania county of Columbia.

We consider our branch banking offices to be a single operating segment, because
these branches have similar:

         -        economic characteristics,

         -        products and services,

         -        operating processes,

         -        delivery system,

         -        customer bases, and

         -        regulatory oversight.

We have not operated any other reportable operating segments in the 3-year
period ended December 31, 2000.

As of December 31, 2000, we had 85 employees on a full-time equivalent basis.
The Company and the Bank are not parties to any collective bargaining agreement
and employee relations are considered to be good.

SUPERVISION AND REGULATION

The following discussion sets forth the material elements of the regulatory
framework applicable to us and the Bank and provides certain specific
information. This regulatory framework is primarily intended for the protection
of investors in our common stock, depositors at the Bank and the Bank Insurance
Fund that insures bank deposits. To the extent that the following information
describes statutory and regulatory provisions, it is qualified by reference to
those provisions. A change in the statutes, regulations or regulatory policies
applicable to us or the Bank may have a material effect on our business.

INTERCOMPANY TRANSACTIONS

Various governmental requirements, including Sections 23A and 23B of the Federal
Reserve Act, limit borrowings by us from the Bank and also limit various other
transactions between us and the Bank. For example, Section 23A

                                       l
<PAGE>   4
of the Federal Reserve Act limits to no more than ten percent of its total
capital the aggregate outstanding amount of the Bank's loans and other "covered
transactions" with any particular non-bank affiliate (including a financial
subsidiary) and limits to no more than 20 percent of its total capital the
aggregate outstanding amount of the Bank's covered transactions with all of its
affiliates (including financial subsidiaries). At December 31, 2000,
approximately $5.0 million was available for loans to us from the Bank. Section
23A of the Federal Reserve Act also generally requires that the Bank's loans to
its non-bank affiliates (including financial subsidiaries) be secured, and
Section 23B of the Federal Reserve Act generally requires that the Bank's
transactions with its non-bank affiliates (including financial subsidiaries) be
on arm's-length terms. Also, we the Bank (and any financial subsidiary) are
prohibited from engaging in certain "tie-in" arrangements in connection with
extensions of credit or provision of property or services.

SUPERVISORY AGENCIES

As a national bank and member of the Federal Reserve System, the Bank is subject
to primary supervision, regulation, and examination by the Office of the
Comptroller of the Currency and secondary regulation by the FDIC. The Bank is
subject to extensive statutes and regulations that significantly affect its
business and activities. The Bank must file reports with its regulators
concerning its activities and financial condition and obtain regulatory approval
to enter into certain transactions. The Bank is also subject to periodic
examinations by its regulators to ascertain compliance with various regulatory
requirements. Other applicable statutes and regulations relate to insurance of
deposits, allowable investments, loans, leases, acceptance of deposits, trust
activities, mergers, consolidations, payment of dividends, capital requirements,
reserves against deposits, establishment of branches and certain other
facilities, limitations on loans to one borrower and loans to affiliated
persons, activities of subsidiaries and other aspects of the business of banks.
Recent federal legislation has instructed federal agencies to adopt standards or
guidelines governing banks' internal controls, information systems, loan
documentation, credit underwriting, interest rate exposure, asset growth,
compensation and benefits, asset quality, earnings and stock valuation, and
other matters. Legislation adopted in 1994 gives the federal banking agencies
greater flexibility in implementing standards on asset quality, earnings, and
stock valuation. Regulatory authorities have broad flexibility to initiate
proceedings designed to prohibit banks from engaging in unsafe and unsound
banking practices.

We and the Bank are also affected by various other governmental requirements and
regulations, general economic conditions, and the fiscal and monetary policies
of the federal government and the Federal Reserve Board. The monetary policies
of the Federal Reserve Board influence to a significant extent the overall
growth of loans, leases, investments, deposits, interest rates charged on loans,
and interest rates paid on deposits. The nature and impact of future changes in
monetary policies are often not predictable.

We are subject to the jurisdiction of the SEC for matters relating to the
offering and sale of our securities. We are also subject to the SEC's rules and
regulations relating to periodic reporting, insider trader reports and proxy
solicitation materials. Our common stock is not listed for quotation of prices
on The NASDAQ Stock Market or any other nationally-recognized stock exchange.
However, daily bid and asked price quotations are maintained on the interdealer
electronic bulletin board system.

SUPPORT OF THE BANK

Under current Federal Reserve Board policy, we are expected to act as a source
of financial and managerial strength to the Bank by standing ready to use
available resources to provide adequate capital funds to the Bank during periods
of financial adversity and by maintaining the financial flexibility and
capital-raising capacity to obtain additional resources for assisting the Bank.
The support expected by the Federal Reserve Board may be required at times when
we may not have the resources or inclination to provide it.

If a default occurred with respect to the Bank, any capital loans to the Bank
from us would be subordinate in right of payment to payment of the Bank
depositors and certain of its other obligations.

                                       2
<PAGE>   5
LIABILITY OF COMMONLY CONTROLLED BANKS

The Bank can be held liable for any loss incurred, or reasonably expected to be
incurred, by the FDIC in connection with:

         -        the default of a commonly controlled FDIC-insured depository
                  institution or

         -        any assistance provided by the FDIC to a commonly controlled
                  FDIC-insured depository institution in danger of default.

"Default" generally is defined as the appointment of a conservator or receiver,
and "in danger of default" generally is defined as the existence of certain
conditions indicating that a default is likely to occur in the absence of
regulatory assistance.

DEPOSITOR PREFERENCE STATUTE

In the "liquidation or other resolution" of the Bank by any receiver, federal
legislation provides that deposits and certain claims for administrative
expenses and employee compensation against the Bank are afforded a priority over
the general unsecured claims against the Bank, including federal funds and
letters of credit.

ALLOWANCE FOR LOAN LOSSES

There are certain risks inherent in making all loans. These risks include
interest rate changes over the time period in which loans may be repaid, risks
resulting from changes in our Northcentral Pennsylvania area economy, risks
inherent in dealing with individual borrowers, and, in the case of a loan backed
by collateral, risks resulting from uncertainties about the future value of the
collateral.

Commercial loans and commercial real estate loans comprised 33% of our total
consolidated loans as of December 31, 2000. Commercial loans are typically
larger than residential real estate loans and consumer loans. Because our loan
portfolio contains a significant number of commercial loans and commercial real
estate loans with relatively large balances, the deterioration of one or a few
of these loans may cause a significant increase in nonperforming loans. An
increase in nonperforming loans could result in a loss of earnings from these
loans, an increase in the provision for loan losses and loan charge-offs.

We maintain an allowance for loan losses to absorb any loan losses based on,
among other things, our historical experience, an evaluation of economic
conditions, and regular reviews of any delinquencies and loan portfolio quality.
We cannot assure you that charge-offs in future periods will not exceed the
allowance for loan losses or that additional increases in the allowance for loan
losses will not be required. Additions to the allowance for loan losses would
result in a decrease in our net income and, possibly, our capital.

In evaluating our allowance for loan losses, we divide our loans into the
following categories:

         -        commercial,

         -        real estate mortgages,

         -        consumer, and

         -        unallocated.

We evaluate some loans as a group and some individually. We use the following
criteria in choosing loans to be evaluated individually:

         -        by industry group,

         -        by risk profile, and

         -        by past due status.

                                       3
<PAGE>   6
After our evaluation of these loans, we allocate portions of our allowance for
loan losses to categories of loans based upon the following considerations:

         -        historical trends,

         -        economic conditions, and

         -        any known deterioration.

We use a self-correcting mechanism to reduce differences between estimated and
actual losses. We will, on a quarterly basis, weight our loss experience among
the various categories and reallocate the allowance for loan losses.

For a more in-depth presentation of our allowance for loan losses and the
components of this allowance, please refer to Item 7 of this report under
Management's Discussion and Analysis of Financial Condition and Results of
Operations as well as footnote 4 at Exhibit 13 to this report.

CAPITAL REQUIREMENTS

We are subject to risk-based capital requirements and guidelines imposed by the
Federal Reserve Board, which are substantially similar to the capital
requirements and guidelines imposed by the Comptroller of the Currency on the
Bank. For this purpose, a bank's or bank holding company's assets and certain
specified off-balance sheet commitments are assigned to four risk categories,
each weighted differently based on the level of credit risk that is ascribed to
those assets or commitments. In addition, risk-weighted assets are adjusted for
low-level recourse and market-risk equivalent assets. A bank's or bank holding
company's capital, in turn, includes the following tiers:

         -        core ("Tier 1") capital, which includes common equity,
                  non-cumulative perpetual preferred stock, a limited amount of
                  cumulative perpetual preferred stock, and minority interests
                  in equity accounts of consolidated subsidiaries, less
                  goodwill, certain identifiable intangible assets, and certain
                  other assets; and

         -        supplementary ("Tier 2") capital, which includes, among other
                  items, perpetual preferred stock not meeting the Tier 1
                  definition, mandatory convertible securities, subordinated
                  debt and allowances for loan and lease losses, subject to
                  certain limitations, less certain required deductions.

We, like other bank holding companies, are required to maintain Tier 1 and
"Total Capital" (the sum of Tier 1 and Tier 2 capital, less certain deductions)
equal to at least four percent and eight percent of their total risk-weighted
assets (including certain off-balance sheet items, such as unused lending
commitments and standby letters of credit), respectively. At December 31, 2000,
we met both requirements, with Tier 1 and Total Capital equal to 20.94 percent
and 21.77 percent of total risk-weighted assets.

The Federal Reserve Board has adopted rules to incorporate market and interest
rate risk components into their risk-based capital standards. Amendments to the
risk-based capital requirements, incorporating market risk, became effective
January 1, 1998. Under the new market-risk requirements, capital will be
allocated to support the amount of market risk related to a financial
institution's ongoing trading activities.

The Federal Reserve Board also requires bank holding companies to maintain a
minimum "Leverage Ratio" (Tier 1 capital to adjusted total assets) of three
percent if the bank holding company has the highest regulatory rating and meets
certain other requirements, or of three percent plus an additional cushion of at
least one to two percentage points if the bank holding company does not meet
these requirements. At December 31, 2000, our leverage ratio was 13.02 percent.

The Federal Reserve Board may set capital requirements higher than the minimums
noted above for holding companies whose circumstances warrant it. For example,
bank holding companies experiencing or anticipating significant growth may be
expected to maintain strong capital positions substantially above the minimum
supervisory levels without significant reliance on intangible assets.
Furthermore, the Federal Reserve Board has indicated that it will consider a
"Tangible Tier 1 Leverage Ratio" (deducting all intangibles) and other indicia
of

                                       4
<PAGE>   7
capital strength in evaluating proposals for expansion or new activities or when
a bank holding company faces unusual or abnormal risk. The Federal Reserve Board
has not advised us of any specific minimum leverage ratio applicable to it.

The Bank is subject to similar risk-based capital and leverage requirements
adopted by the Comptroller of the Currency. The Bank was in compliance with the
applicable minimum capital requirements as of December 31, 2000. The Comptroller
of the Currency has not advised the Bank of any specific minimum leverage ratio
applicable to it.

Failure to meet capital requirements could subject the Bank to a variety of
enforcement remedies, including the termination of deposit insurance by the
FDIC, and to certain restrictions on its business. The Federal Deposit Insurance
Corporation Improvements Act of 1991 ("FDICIA"), among other things, identifies
five capital categories for insured banks - well capitalized, adequately
capitalized, undercapitalized, significantly undercapitalized, and critically
undercapitalized - and requires federal bank regulatory agencies to implement
systems for "prompt corrective action" for insured banks that do not meet
minimum capital requirements based on these categories. The FDICIA imposed
progressively more restrictive constraints on operations, management, and
capital distributions, depending on the category in which an institution is
classified. Unless a bank is well capitalized, it is subject to restrictions on
its ability to offer brokered deposits, on "pass-through" insurance coverage for
certain of its accounts, and on certain other aspects of its operations. FDICIA
generally prohibits a bank from paying any dividend or making any capital
distribution or paying any management fee to its holding company if the bank
would thereafter be undercapitalized. An undercapitalized bank is subject to
regulatory monitoring and may be required to divest itself of or liquidate
subsidiaries. Holding companies of such institutions may be required to divest
themselves of such institutions or divest themselves of or liquidate other
affiliates. An undercapitalized bank must develop a capital restoration plan,
and its parent bank holding company must guarantee the bank's compliance with
the plan up to the lesser of five percent of the bank's assets at the time it
became undercapitalized or the amount needed to comply with the plan. Critically
undercapitalized institutions are prohibited from making payments of principal
and interest on subordinated debt and are generally subject to the mandatory
appointment of a conservator or receiver.

Rules adopted by the Comptroller of the Currency under FDICIA provide that a
national bank is deemed to be well capitalized if the bank has a total
risk-based capital ratio of ten percent or greater, a Tier 1 risk-based capital
ratio of six percent or greater, and a leverage ratio of five percent or greater
and the institution is not subject to a written agreement, order, capital
directive, or prompt corrective action directive to meet and maintain a specific
level of any capital measure. As of December 31, 2000, the Bank was
well-capitalized, based on the prompt corrective action ratios and guidelines
described above. It should be noted, however, that a bank's capital category is
determined solely for the purpose of applying the Comptroller of the Currency's
prompt corrective action regulations, and that the capital category may not
constitute an accurate representation of the bank's overall financial condition
or prospects.

BROKERED DEPOSITS

Under FDIC regulations, no FDIC-insured bank can accept brokered deposits unless
it (1) is well capitalized, or (2) is adequately capitalized and receives a
waiver from the FDIC. In addition, these regulations prohibit any bank that is
not well capitalized from paying an interest rate on brokered deposits in excess
of three-quarters of one percentage point over certain prevailing market rates.
As of December 31, 2000, the Bank held no brokered deposits.

DIVIDEND RESTRICTIONS

We are a legal entity separate and district from the Bank. In general, under
Pennsylvania law, we cannot pay a cash dividend if such payment would render us
insolvent. Our revenues consist primarily of dividends paid by the Bank. The
National Bank Act limits the amount of dividends the Bank can pay to us without
regulatory approval. The Bank may declare and pay dividends to us to the lesser
of:

                                       5
<PAGE>   8
         -        the level of undivided profits, and

         -        absent regulatory approval, an amount not in excess of net
                  income combined with retained net income for the preceding two
                  years.

At December 31, 2000, approximately $2,164,881 million was available for payment
of dividends to us.

In addition, federal bank regulatory authorities have authority to prohibit the
Bank from engaging in an unsafe or unsound practice in conducting its business.
Depending upon the financial condition of the bank in question, the payment of
dividends could be deemed to constitute an unsafe or unsound practice. The
ability of the Bank to pay dividends in the future is currently influenced, and
could be further influenced, by bank regulatory policies and capital guidelines.

DEPOSIT INSURANCE ASSESSMENTS

The deposits of the Bank are insured up to regulatory limits by the FDIC and,
accordingly, are subject to deposit insurance assessments to maintain the Bank
Insurance Fund ("BIF") administered by the FDIC. The FDIC has adopted
regulations establishing a permanent risk-related deposit insurance assessment
system. Under this system, the FDIC places each insured bank in one of nine risk
categories based on the bank's capitalization and supervisory evaluations
provided to the FDIC by the institution's primary federal regulator. An insured
bank's insurance assessment rate is then determined by the risk category in
which it is classified by the FDIC.

In the light of the recent favorable financial situation of the federal deposit
insurance funds and the recent low number of depository institution failures,
effective January 1, 1997 the annual insurance premiums on bank deposits insured
by the BIF vary between $0.00 per $100 of deposits for banks classified in the
highest capital and supervisory evaluation categories to $0.27 per $100 of
deposits for banks classified in the lowest capital and supervisory evaluation
categories. BIF assessment rates are subject to semi-annual adjustment by the
FDIC within a range of up to five basis points without public comment. The FDIC
also possesses authority to impose special assessments from time to time.

The Deposit Insurance Funds Act provides for assessments to be imposed on
insured depository institutions with respect to deposits insured by the BIF ( in
addition to assessments currently imposed on depository institutions with
respect to BIF-insured deposits) to pay for the cost of Financing Corporation
("FICO") funding. The FDIC established the FICO assessment rates effective for
the fourth quarter 2000 at approximately $0.0202 per $100 annually for
BIF-assessable deposits. The FICO assessments are adjusted quarterly to reflect
changes in the assessment bases of the FDIC insurance funds and do not vary
depending upon a depository institution's capitalization or supervisory
evaluations. In 2000, the Bank paid FICO assessments of $28,149.

INTERSTATE BANKING AND BRANCHING

Under the Riegle-Neal Interstate Banking and Branching Efficiency Act
("Riegle-Neal"), subject to certain concentration limits and other requirements:

         -        bank holding companies, such as we, are permitted to acquire
                  banks and bank holding companies located in any state;

         -        any bank that is a subsidiary of a bank holding company is
                  permitted to receive deposits, renew time deposits, close
                  loans, service loans, and receive loan payments as an agent
                  for any other depository institution subsidiary of that bank
                  holding company; and

         -        banks are permitted to acquire branch offices outside their
                  home states by merging with out-of-state banks, purchasing
                  branches in other states, and establishing de novo branch
                  offices in other states.

The ability of banks to acquire branch offices through purchase or opening of
other branches is contingent, however, on the host state having adopted
legislation "opting in" to those provisions of Riegle-Neal. In addition, the
ability of a bank to merge with a bank located in another state is contingent on
the host state not having adopted

                                       6
<PAGE>   9
legislation "opting out" of that provision of Riegle-Neal. Pennsylvania has
opted in to all of these provisions upon the condition that another host state
has similar or reciprocal requirements as in Pennsylvania.

As of the date of this report, we are not contemplating any interstate
acquisitions of a bank or a branch office.

CONTROL ACQUISITIONS

The Change in Bank Control Act prohibits a person or group of persons from
acquiring "control" of a bank holding company, unless the Federal Reserve Board
has been notified and has not objected to the transaction. Under a rebuttable
presumption established by the Federal Reserve Board, the acquisition of ten
percent or more of a class of voting stock of a bank holding company with a
class of securities registered under Section 12 of the Exchange Act, such as we,
would, under the circumstances set forth in the presumption, constitute
acquisition of control of the bank holding company.

In addition, a company is required to obtain the approval of the Federal Reserve
Board under the Bank Holding Company Act before acquiring 25 percent (five
percent in the case of an acquirer that is a bank holding company) or more of
any class of outstanding common stock of a bank holding company, such as we, or
otherwise obtaining control or a "controlling influence" over that bank holding
company.

PERMITTED NON-BANKING ACTIVITIES

The Federal Reserve Board permits us or our subsidiaries to engage in nonbanking
activities so closely related to banking or managing or controlling banks as to
be a proper incident thereto. For a discussion of other activities that are
financial in nature in which we can engage, see the caption that follows
entitled "Financial Services Modernization."

The Federal Reserve Board requires us to serve as a source of financial and
managerial strength to the Bank and not to conduct our operations in an unsafe
and unsound manner. Whenever the Federal Reserve Board believes an activity that
we are doing or our control of a nonbank subsidiary (other than a nonbank
subsidiary of the Bank) constitutes a serious risk to the financial safety,
soundness, or stability of the Bank and is inconsistent with sound banking
principles or the purposes of the federal banking laws, the Federal Reserve
Board may require us to terminate that activity or to terminate control of that
subsidiary. While the types of permissible activities are subject to change by
the Federal Reserve Board, the principal nonbanking activities that presently
may be conducted by a bank holding company or its subsidiary without prior
approval of the Federal Reserve Board are:

         -        Servicing Activities. Furnishing services for, or establish or
                  acquire a company that engages solely in servicing activities
                  for:

                  -        us or the Bank in connection with activities
                           authorized by law, such as commitments entered into
                           by any subsidiary with third parties as long as we or
                           our servicing company comply with published
                           guidelines and do not act as a principal in dealing
                           with third parties;

                  -        the internal operations of the Bank, such as:

                           -        accounting, auditing and appraising;

                           -        advertising and public relations;

                           -        data processing and transmission services,
                                    data bases or facilities; - personnel
                                    services; - courier services; - holding or
                                    operating property used by our subsidiaries
                                    or for their future use; - liquidating
                                    property acquired from the Bank; and

                           -        selling, purchasing or underwriting
                                    insurance, such as blanket bond insurance,
                                    group insurance for employees and property
                                    and casualty insurance.

                                       7
<PAGE>   10
         -        Safe deposit business. Conduct a safe deposit business or
                  acquire voting securities of a company that conducts such
                  business.

         -        Securities or property representing five percent or less of
                  any company. Acquiring five percent or less of the outstanding
                  voting securities of any company regardless of that company's
                  activities.

         -        Extending credit and servicing loans. Making, acquiring,
                  brokering, or servicing loans or other extensions of credit
                  (including factoring, issuing letters of credit and accepting
                  drafts) for the company's account or for the account of
                  others.

         -        Activities related to extending credit. Any activity usual in
                  connection with making, acquiring, brokering or servicing
                  loans or other extensions of credit, as determined by the
                  Federal Reserve Board. The Federal Reserve Board has
                  determined that the following activities are usual in
                  connection with making, acquiring, brokering or servicing
                  loans or other extensions of credit:

                  -        Real estate and personal property appraising.
                           Performing appraisals of real estate and tangible and
                           intangible personal property, including securities.

                  -        Arranging commercial real estate equity financing.
                           Acting as intermediary for the financing of
                           commercial or industrial income-producing real estate
                           by arranging for the transfer of the title, control,
                           and risk of such a real estate project to one or more
                           investors, if the bank holding company and its
                           affiliates do not have an interest in, or participate
                           in managing or developing, a real estate project for
                           which it arranges equity financing, and do not
                           promote or sponsor the development of the property.

                  -        Check-guaranty services. Authorizing a subscribing
                           merchant to accept personal checks tendered by the
                           merchant's customers in payment for goods and
                           services, and purchasing from the merchant validly
                           authorized checks that are subsequently dishonored.

                  -        Collection agency services. Collecting overdue
                           accounts receivable, either retail or commercial.

                  -        Credit bureau services. Maintaining information
                           related to the credit history of consumers and
                           providing the information to a credit grantor who is
                           considering a borrower's application for credit or
                           who has extended credit to the borrower.

                  -        Asset management, servicing, and collection
                           activities. Engaging under contract with a third
                           party in asset management, servicing, and collection
                           of assets of a type that an insured depository
                           institution may originate and own, if the company
                           does not engage in real property management or real
                           estate brokerage services as part of these services.

                  -        Acquiring debt in default. Acquiring debt that is in
                           default at the time of acquisition under certain
                           conditions.

                  -        Real estate settlement servicing. Providing real
                           estate settlement services.

-        Leasing personal or real property. Leasing personal or real property or
         acting as agent, broker, or adviser in leasing such property under
         certain conditions.

-        Operating nonbank depository institutions:

         -        Industrial banking. Owning, controlling, or operating an
                  industrial bank, Morris Plan bank, or industrial loan company,
                  so long as the institution is not a bank.

                                       8
<PAGE>   11
         -        Operating savings association. Owning, controlling or
                  operating a savings association, if the savings association
                  engages only in deposit-taking activities, lending, and other
                  activities that are permissible for bank holding companies.

-        Trust company functions. Performing functions or activities that may be
         performed by a trust company (including activities of a fiduciary,
         agency, or custodial nature), in the manner authorized by federal or
         state law, so long as the company is not a bank for purposes of the
         Bank Holding Company Act.

-        Financial and investment advisory activities. Acting as investment or
         financial advisor to any person, including (without, in any way,
         limiting the foregoing):

         -        Serving as investment adviser (as defined in section 2(a)(20)
                  of the Investment Company Act of 1940, 15 U.S.C.
                  80a-2(a)(20)), to an investment company registered under that
                  act, including sponsoring, organizing, and managing a
                  closed-end investment company;

         -        Furnishing general economic information and advice, general
                  economic statistical forecasting services, and industry
                  studies;

         -        Providing advice in connection with mergers, acquisitions,
                  divestitures, investments, joint ventures, leveraged buyouts,
                  recapitalizations, capital structurings, financing
                  transactions and similar transactions, and conducting
                  financial feasibility studies;

         -        Providing information, statistical forecasting, and advice
                  with respect to any transaction in foreign exchange, swaps,
                  and similar transactions, commodities, and any forward
                  contract, option, future, option on a future, and similar
                  instruments;

         -        Providing educational courses, and instructional materials to
                  consumers on individual financial management matters; and

         -        Providing tax-planning and tax-preparation services to any
                  person.

-        Agency transactional services for customer investments:

         -        Securities brokerage. Providing securities brokerage services
                  (including securities clearing and/or securities execution
                  services on an exchange), whether alone or in combination with
                  investment advisory services, and incidental activities
                  (including related securities credit activities and custodial
                  services), if the securities brokerage services are restricted
                  to buying and selling securities solely as agent for the
                  account of customers and do not include securities
                  underwriting or dealing.

         -        Riskless principal transactions. Buying and selling in the
                  secondary market all types of securities on the order of
                  customers as a "riskless principal" to the extent of engaging
                  in a transaction in which the company, after receiving an
                  order to buy (or sell) a security from a customer, purchases
                  (or sells) the security for its own account to offset a
                  contemporaneous sale to (or purchase from) the customer. This
                  does not include:

                  (A) Selling bank-ineligible securities at the order of a
         customer that is the issuer of the securities, or selling
         bank-ineligible securities in any transaction where the company has a
         contractual agreement to place the securities as agent of the issuer;
         or

                                       9
<PAGE>   12
                  (B) Acting as a riskless principal in any transaction
         involving a bank-ineligible security for which the company or any of
         its affiliates acts as underwriter (during the period of the
         underwriting or for 30 days thereafter) or dealer.

         -        Private placement services. Acting as agent for the private
                  placement of securities in accordance with the requirements of
                  the Securities Act of 1933 ("1933 Act") and the rules of the
                  Securities and Exchange Commission, if the company engaged in
                  the activity does not purchase or repurchase for its own
                  account the securities being placed, or hold in inventory
                  unsold portions of issues of these securities.

         -        Futures commission merchant. Acting as a futures commission
                  merchant ("FCM") for unaffiliated persons in the execution,
                  clearance, or execution and clearance of any futures contract
                  and option on a futures contract traded on an exchange in the
                  United States or abroad under certain conditions.

         -        Other transactional services. Providing to customers as agent
                  transactional services with respect to swaps and similar
                  transactions.

-        Investment transactions as principal:

         -        Underwriting and dealing in government obligations and money
                  market instruments. Underwriting and dealing in obligations of
                  the United States, general obligations of states and their
                  political subdivisions, and other obligations that state
                  member banks of the Federal Reserve System may be authorized
                  to underwrite and deal in under 12 U.S.C. 24 and 335,
                  including banker's acceptances and certificates of deposit,
                  under the same limitations as would be applicable if the
                  activity were performed by the bank holding company's
                  subsidiary member banks or its subsidiary nonmember banks as
                  if they were member banks.

         -        Investing and trading activities. Engaging as principal in:

                  (A) Foreign exchange;

                  (B) Forward contracts, options, futures, options on futures,
         swaps, and similar contracts, whether traded on exchanges or not, based
         on any rate, price, financial asset (including gold, silver, platinum,
         palladium, copper, or any other metal approved by the Federal Reserve
         Board), nonfinancial asset, or group of assets, other than a
         bank-ineligible security under certain conditions.

                  (C) Forward contracts, options, futures, options on futures,
         swaps, and similar contracts, whether traded on exchanges or not, based
         on an index of a rate, a price, or the value of any financial asset,
         nonfinancial asset, or group of assets, if the contract requires such
         settlement.

         -        Buying and selling bullion, and related activities. Buying,
                  selling and storing bars, rounds, bullion, and coins of gold,
                  silver, platinum, palladium, copper, and any other metal
                  approved by the Federal Reserve Board, for the company's own
                  account and the account of others, and providing incidental
                  services such as arranging for storage, safe custody,
                  assaying, and shipment.

-        Management consulting and counseling activities:

         -        Management consulting. Providing management consulting advice
                  under certain conditions.

         -        Employee benefits consulting services. Providing consulting
                  services to employee benefit, compensation and insurance
                  plans, including designing plans, assisting in the
                  implementation

                                       10
<PAGE>   13
                  of plans, providing administrative services to plans, and
                  developing employee communication programs for plans.

         -        Career counseling services. Providing career counseling
                  services to:

                  (A) A financial organization and individuals currently
         employed by, or recently displaced from, a financial organization;

                  (B) Individuals who are seeking employment at a financial
         organization; and

                  (C) Individuals who are currently employed in or who seek
         positions in the finance, accounting, and audit departments of any
         company.

-        Support services:

         -        Courier services. Providing courier services for:

                  (A) Checks, commercial papers, documents, and written
         instruments (excluding currency or bearer-type negotiable instruments)
         that are exchanged among banks and financial institutions; and

                  (B) Audit and accounting media of a banking or financial
         nature and other business records and documents used in processing such
         media.

         (ii) Printing and selling MICR-encoded items. Printing and selling
checks and related documents, including corporate image checks, cash tickets,
voucher checks, deposit slips, savings withdrawal packages, and other forms that
require Magnetic Ink Character Recognition ("MICR") encoding.

-        Insurance agency and underwriting:

         -        Credit insurance. Acting as principal, agent, or broker for
                  insurance (including home mortgage redemption insurance) that
                  is:

                  (A) Directly related to an extension of credit by the bank
         holding company or any of its subsidiaries; and

                  (B) Limited to ensuring the repayment of the outstanding
         balance due on the extension of credit in the event of the death,
         disability, or involuntary unemployment of the debtor.

         -        Finance company subsidiary. Acting as agent or broker for
                  insurance directly related to an extension of credit by a
                  finance company that is a subsidiary of a bank holding company
                  under certain conditions.

         -        Engaging in any general insurance agency activities.

-        Community development activities:

         -        Financing and investment activities. Making equity and debt
                  investments in corporations or projects designed primarily to
                  promote community welfare, such as the economic rehabilitation
                  and development of low-income areas by providing housing,
                  services, or jobs for residents.

                                       11
<PAGE>   14
         -        Advisory activities. Providing advisory and related services
                  for programs designed primarily to promote community welfare.

-        Money orders, savings bonds, and traveler's checks. The issuance and
         sale at retail of money orders and similar consumer-type payment
         instruments; the sale of U.S. savings bonds; and the issuance and sale
         of traveler's checks.

-        Data processing. Providing data processing and data processing and data
         transmission services, facilities (including data processing and data
         transmission hardware, software, documentation, or operating
         personnel), data bases, advice, and access to such services,
         facilities, or data bases by any technological means under certain
         conditions.

Community Reinvestment Act

The Community Reinvestment Act of 1977, as amended (the "CRA"), and the
regulations promulgated to implement the CRA are designed to create a system for
bank regulatory agencies to evaluate a depository institution's record in
meeting the credit needs of its community. CRA regulations establish tests for
evaluating both small and large depository institutions' investment in the
community. A "small bank" is defined as a bank which has total assets of less
than $250 million and is independent or is an affiliate of a holding company
with less than $1 billion in assets. There are streamlined procedures for
evaluating small banks and the frequency of CRA examinations will occur less
often based upon a bank's CRA rating. A large retail institution is one which
does not meet the "small bank" definition. A large retail institution can be
evaluated under one of two tests: (1) a three-part test evaluating the
institution's lending, service and investment performance; or (2) a "strategic
plan" designed by the institution with community involvement and approved by the
appropriate federal bank regulator. A large institution must choose one of these
options under which, to be examined. In addition, the CRA regulations include
separate rules regarding the manner in which "wholesale banks" and "limited
purpose banks" will be evaluated for compliance.

For the purposes of the CRA regulations, the Bank is deemed to be a "small
bank," based upon financial information as of December 31, 2000. The Bank will
be examined under the streamlined procedures. The Bank received a "satisfactory"
CRA rating in its last CRA examination which was held in 1997.

Concentration

We are not dependent for deposits nor exposed by loan concentrations to a single
customer or to a small group of customers the loss of any one or more of which
would have a materially adverse effect on our financial condition.

Financial Services Modernization

On November 12, 1999, the President signed into law the Gramm-Leach-Bliley Act
(the "GLB Act") which will, in general, take effect on March 11, 2000. The GLB
Act contains some of the most far-reaching changes governing the operations of
companies doing business in the financial services industry. The GLB Act
eliminates the restrictions placed on the activities of banks and bank holding
companies. By creating two new structures - financial holding companies and
financial subsidiaries - we and the Bank will be allowed to provide a wider
array of financial services and products that were reserved only for insurance
companies and securities firms. In addition, we can now affiliate with an
insurance company and a securities firm.

On December 19, 2000 we became a financial holding company by filing an election
to do so with the Federal Reserve Board. We became a financial holding company
in anticipation of a contemplated transaction to acquire an interest in a local
insurance agency. This contemplated transaction is expected to close sometime
during the first quarter of 2001. A financial holding company has authority to
engage in activities referred to as "financial activities" that are not
permitted to bank holding companies. A financial holding company may also
affiliate with companies that are engaged in financial activities. A "financial
activity" is an activity that does not pose a safety and soundness risk and is:

                                       12
<PAGE>   15
-        financial in nature,

-        incidental to an activity that is financial in nature, or

-        complimentary to a financial activity.

The GLB Act lists certain activities as financial in nature:

-        Lending, investing or safeguarding money or securities;

-        Underwriting insurance or annuities, or acting as an insurance or
         annuity principal, agent or broker;

-        Providing financial or investment advice;

-        Issuing or selling interests in pools of assets that a bank could hold;

-        Underwriting, dealing in or making markets in securities;

-        Engaging in any activity that the Federal Reserve Board found before
         the GLB Act to be related closely to banking (See the section in this
         report entitled "Permitted Non-banking Activities");

-        Engaging within the United States in any activity that a bank holding
         company could engage in outside of the country, if the Federal Reserve
         Board determined before the GLB Act that the activity was usual in
         connection with banking or other financial operations internationally;

-        Merchant banking - acquiring or controlling ownership interests in an
         entity engaged in impermissible activities, if: the interests are not
         held by a depository institution; the interests are held by a
         securities affiliate or an investment advisory affiliate of an
         insurance company as part of underwriting, merchant or investment
         banking activity; the interests are held long enough to enable their
         sale in a manner consistent with the financial viability of such an
         activity; and we do not control the entity except to the extent
         necessary to obtain a reasonable return on the investment; or

-        Insurance portfolio investing - acquiring or controlling ownership
         interests in an entity engaged in impermissible activities, if: the
         interests are not held by a depository institution; the interests are
         held by an insurance or annuity company; the interests represent
         investments made in the ordinary course of business in accordance with
         state law; and we do not control the entity except to the extent
         necessary to obtain a reasonable return on the investment.

The GLB Act instructs the Federal Reserve Board to adopt a regulation or order
defining certain additional activities as financial in nature, to the extent
they are consistent with the purposes of the GLB Act. These are:

-        Lending, exchanging, transferring, investing for others or safeguarding
         financial assets other than money or securities;

-        Providing any method of transferring financial assets; and

-        Arranging, effecting or facilitating financial transactions for third
         parties.

Other activities also may be decided by the Federal Reserve Board to be
financial in nature or incidental to a financial activity if they meet specified
criteria. The Federal Reserve Board is instructed to consider the purposes of
the GLB Act and the Bank Holding Company Act; changes in the market in which
financial holding companies compete; changes in the technology used to deliver
financial services; and whether the proposed activity is necessary or
appropriate to allow a financial holding company and its affiliates to compete
effectively, deliver services efficiently and offer services through the most
advanced technological means available.

The GLB Act gives national banks authority to use "financial subsidiaries" to
engage in financial activities. This authority has some limitations. A financial
subsidiary of the Bank may not, as a principal:

-        underwrite insurance or annuities;

-        engage in real estate development or investment;

-        engage in merchant banking; or

-        engage in insurance portfolio investment activities.

A bank's investment in a financial subsidiary will affect the way it calculates
its capital. The bank must deduct from its assets and stockholders' equity the
total of its investments in financial subsidiaries. Moreover, a bank

                                       13
<PAGE>   16
must present its financial information in two ways: in accordance with generally
accepted accounting principles, and, separately, in a manner that reflects the
segregation of the bank's investments in financial subsidiaries.

Privacy

Title V of the GLB Act creates a minimum federal standard of privacy by limiting
the instances which we and the Bank may disclose nonpublic personal information
about a consumer of our products or services to nonaffiliated third parties. A
state, such as Pennsylvania, can impose a greater or more restrictive standard
of privacy than the GLB Act. The GLB Act distinguishes "consumers" from
"customers" for purposes of the notice requirements imposed by this Act. We are
required to give a "consumer" a privacy notice only if we intend to disclose
nonpublic personnel information about the consumer to a nonaffiliated third
party. However, by contrast, we are required to give a "customer" a notice of
our privacy policy at the time of the establishment of a customer relationship
and then annually, thereafter during the continuation of the customer
relationship.

The term consumer is different from the term customer. A consumer means an
individual who obtains or has obtained a financial product or service from the
Bank that is to be used primarily for personal, family or household purposes or
that individual's representative. A customer of the Bank is an individual with a
continuous relationship with the Bank. The Office of the Comptroller of the
Currency issued regulations (effective November 13, 2000, however, compliance is
optional until July 1, 2001) which give several examples of a consumer and
customer relationship:

         -        An individual who applies to the Bank for credit for personal,
                  family or household purposes is a consumer of a financial
                  service, regardless of whether the credit is extended.

         -        An individual who provides nonpublic personal information to
                  the Bank in order to obtain a determination about whether he
                  or she may qualify for a loan to be used primarily for
                  personal, family, or household purposes is a consumer of a
                  financial service, regardless of whether the loan is extended
                  by the Bank or another financial institution.

         -        An individual who provides nonpublic personal information to
                  the Bank in connection with obtaining or seeking to obtain
                  financial, investment or economic advisory services is a
                  consumer regardless of whether the Bank establishes an ongoing
                  advisory relationship.

         -        An individual who negotiates a workout with the Bank for a
                  loan that the Bank owns is a consumer regardless of whether
                  the Bank originally extended the loan to the individual.

         -        An individual who has a loan from the Bank is the Bank's
                  consumer even if the Bank:

                  -        Hires an agent to collect on the loan;

                  -        Sells the rights to service the loan; or

                  -        Bought the loan from the financial institution that
                           originated the loan.

         -        An individual is not the Bank's consumer solely because the
                  Bank processes information about the individual on behalf of a
                  financial institution that extended the loan to the
                  individual.

On the other hand, several examples of a customer follow:

         -        A customer has a continuing relationship with the Bank if the
                  customer:

                  -        Has a deposit, loan, credit, trust or investment
                           account with the Bank;

                  -        Purchases an insurance product from the Bank;

                  -        Holds an investment product through the Bank;

                  -        Enters into an agreement or understanding with the
                           Bank whereby the Bank undertakes to arrange or broker
                           a home mortgage loan for the customer;

                  -        Has a loan that the Bank services where the Bank owns
                           the servicing rights;

                  -        Enters into a lease of personal property with the
                           Bank; or

                  -        Obtains financial, investment, or economic advisory
                           services from the Bank for a fee.

         -        A person does not, however, have a continuing relationship
                  with the Bank and therefore is not a customer, if:

                  -        The person only obtains a financial product or
                           service in an isolated transaction, such as
                           withdrawing cash from the Bank's ATM or purchasing a
                           cashier's check or money order;

                                       14
<PAGE>   17
                  -        The Bank sells the person's loan and does not retain
                           the rights to service the loan; or

                  -        The Bank sells the person airline tickets, travel
                           insurance or traveler's checks in an isolated
                           transaction.

In general, the Bank cannot disclose to a nonaffiliated third party any
nonpublic personal information of its customers and consumers unless the Bank
provides its customer or consumer with a notice that includes:

         -        the policies and practices of the Bank with regard to:

                  -        disclosing nonpublic personal information to
                           nonaffiliated third parties;

                  -        the categories of persons to whom the information is
                           or may be disclosed; and

                  -        the policy for disclosure to former customers;

         -        categories of nonpublic personal information that are
                  collected by the Bank;

         -        the policies that the Bank maintains to protect the
                  confidentiality and security of nonpublic personal
                  information;

         -        the disclosure, if required, under the Fair Credit Reporting
                  Act; and

         -        in addition, the Bank must provide an opt out notice to each
                  of its consumers and customers that explains accurately the
                  right to opt out of any disclosure by the Bank of the
                  customer's or consumer's nonpublic personal information and
                  the means by which the customer or consumer may exercise the
                  opt out right.

The GLB Act sets forth a new requirement that this notice to a consumer or
customer must be in clear and conspicuous or "plain English" language and
presentation. The proposed regulations give several examples of the rules to
follow in drafting these notices:

         -        The Bank makes its notice reasonably understandable if, the
                  Bank:

                  -        Presents the information contained in the notice in
                           clear, concise sentences, paragraphs and sections;

                  -        Uses short explanatory sentences and bullet lists,
                           whenever possible;

                  -        Uses definite, concrete, everyday words and active
                           voice, whenever possible;

                  -        Avoids multiple negatives;

                  -        Avoids legal and highly technical business
                           terminology; and

                  -        Avoids boilerplate explanations that are imprecise
                           and readily subject to different interpretations.

         -        The Bank designs its notice to call attention to the nature
                  and significance of the information contained in the notice
                  if, to the extent applicable, the Bank:

                  -        Uses a plain-language heading to call attention to
                           the notice;

                  -        Uses a typeface and type size that are easy to read;
                           and

                  -        Provides wide margins and ample line spacing.

         -        If the Bank provides a notice on the same form as another
                  notice or other documents, the Bank designs its notice to call
                  attention to the nature and significance of the information
                  contained in the notice if the Bank uses:

                  -        Larger type size(s), boldface or italics in the text;

                  -        Wider margins and line spacing in the notice; or

                  -        Shading or sidebars to highlight the notice, whenever
                           possible.

The GLB Act creates certain exceptions to the prohibition on disclosure of
nonpublic personal information of customers and consumers. Some of these
exceptions are:

         -        with the consent of the customer or consumer;

         -        to effect, administer or enforce a transaction requested or
                  authorized by the customer or consumer;

         -        the servicing or processing of a financial product or service
                  requested or authorized by the customer or consumer;

                                       15
<PAGE>   18
         -        the maintaining or servicing of the customer's or consumer's
                  account with the Bank or with another entity as part of a
                  private label credit card program;

         -        disclosure to persons holding a legal or beneficial interest
                  relating to the customer or consumer or to persons acting in a
                  fiduciary or representative capacity on behalf of the customer
                  or consumer;

         -        providing information to insurance rate advisory
                  organizations, guaranty funds or agencies, rating agencies,
                  persons assessing the Bank's compliance with industry
                  standards and the Bank's attorneys, accountants and auditors;
                  and

         -        disclosure permitted under other laws, such as the Right to
                  Financial Privacy Act, to law enforcement agencies or under
                  local and state laws.

The Bank cannot disclose an account number or similar form of access code for a
credit card account, deposit account or transaction account of a customer or
consumer to any non-affiliated third party for use in telemarketing, direct mail
marketing or other marketing through electronic mail to the customer or
consumer.

The Bank

The Bank's legal headquarters are located at 232 East Street, Bloomsburg,
Columbia County, Pennsylvania 17815. The Bank is a locally-owned and managed
community bank that seeks to provide personal attention and professional
financial assistance to its customers. The Bank serves the needs of individuals
and small - and medium-sized businesses. The Bank's business philosophy includes
offering direct access to its President and other officers and providing
friendly, informed and courteous service, local and timely decision making,
flexible and reasonable operating procedures and consistently-applied credit
policies.

The Bank solicits small and medium-sized businesses located primarily with in
the Bank's market area that typically borrow in the $25,000 to $1.0 million
range. In the event that certain loan requests may exceed the Bank's lending
limit to any one customer, the Bank seeks to arrange such loans on a
participation basis with other financial institutions.

Marketing Area

The Bank's primary market area is Columbia County, a 484 square mile area
located in Northcentral Pennsylvania with a population of approximately 63,200
based on 1990 census data. The Town of Bloomsburg is the County's largest
municipality and its center of industry and commerce. Bloomsburg has a
population of approximately 12,400 based on 1990 census data, and is the county
seat. Berwick, located on the eastern boundary of the County, is the second
largest municipality, with a 1990 population of approximately 11,000. The Bank
currently serves its market area through six branch offices located in
Bloomsburg, Benton, Lightstreet, Millville, Orangeville and South Centre,
Columbia County.

The Bank competes with eight other depository institutions in Columbia County.
The Bank's major competitors are: First National Bank of Berwick; PNC Bank,
N.A., the largest commercial bank headquartered in Pennsylvania; and First
Columbia Bank and Trust Company of Bloomsburg, Pennsylvania.

The Bank's extended market area includes the adjacent Pennsylvania counties of
Luzerne, Montour, Northumberland, Schuylkill and Sullivan.

Future Legislation

Various legislation, including proposals to substantially change the financial
institution regulatory system and to expand or contract the powers of banking
institutions and bank holding companies, is from time to time introduced in the
Congress. This legislation may change banking statutes and our operating
environment in substantial and unpredictable ways. If enacted, such legislation
could increase or decrease the cost of doing business, limit or expand
permissible activities or affect the competitive balance among banks, savings
associations, credit unions, and other financial institutions. We can not
accurately predict whether any of this potential legislation will

                                       16
<PAGE>   19
ultimately be enacted, and, if enacted, the ultimate effect that it, or
implementing regulations, would have upon our financial condition or results of
operations.

Item 2.  Properties

Our corporate headquarters are located at 232 East Street, Bloomsburg,
Pennsylvania. We own this facility which has approximately 11,686 square feet.
The Bank's legal or registered office is also at 232 East Street, Bloomsburg,
Pennsylvania.

Our remaining banking centers, all of which we own, are described as follows:

<TABLE>
<CAPTION>
                                         Approximate
        Location                         Square Footage                    Use
<S>                                      <C>                      <C>
      Orangeville, PA                        2,259                Banking Services
      Benton, PA                             4,672                Banking Services
      South Centre, PA                       3,868                Banking Services
      Scott Township, PA                    16,500                Banking Services, Corporate,
                                                                  Credit and Operations
      Millville, PA                          2,520                Banking Services
</TABLE>

We consider our facilities to be suitable and adequate for our current and
immediate future purposes.

Item 3.  Legal Proceedings

We and the Bank are not parties to any legal proceedings that could have any
significant effect upon our financial condition or income. In addition, we and
the Bank are not parties to any legal proceedings under federal and state
environmental laws.


PART II.

Item 5. Market for the Registrant's Common Equity and Related Stockholder
        Matters

We had 754 stockholders of record including individual participants in security
position listings and 1,343,708 shares of common stock, par value of $1.25 per
share, the only authorized class of common stock, outstanding as of February 28,
2001. Our common stock trades under the symbol "CCFN." As of February 28, 2001,
six firms were identified on the interdealer electronic bulletin board system as
market makers in our common stock. The following information is reported by one
of our market makers: Tucker Anthony of Lancaster, Pennsylvania. These
quotations represent prices between buyers and sellers and do not include retail
makeup, markdown or commission. They may not necessarily represent actual
transactions. The high and low closing sale prices and dividends per share of
our common stock for the four quarters of 2000 and 1999 are summarized in the
following table.

<TABLE>
<CAPTION>
                                                                                                          Dividends
2000:                                                                       High              Low          Declared
<S>                                                                         <C>              <C>          <C>
First quarter                                                               17.00            16.38           .140
Second quarter                                                              16.63            16.38           .140
Third quarter                                                               17.50            16.00           .140
Fourth quarter                                                              19.50            16.00           .140
</TABLE>

                                       17
<PAGE>   20
<TABLE>
<CAPTION>
                                                                                                         Dividends
1999:                                                                        High             Low         Declared
<S>                                                                         <C>              <C>         <C>
First quarter                                                               25.00            19.13           .116
Second quarter                                                              20.50            18.00           .130
Third quarter                                                               20.63            20.00           .130
Fourth quarter                                                              20.12            18.75           .130
</TABLE>


We have paid cash dividends since 1983. It is our present intention to continue
the dividend payment policy, although the payment of future dividends must
necessarily depend upon earnings, financial position, appropriate restrictions
under applicable law and other factors relevant at the time the Board of
Directors considers any declaration of dividends.

Item 6. Selected Financial Data

The information called for by this item is filed at Exhibit 13 to this report
and is incorporated in its entirety by reference under this Item 6.

Item 7.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations

The information called for by this item is filed at Exhibit 13 to this report
and is incorporated in its entirety by reference under this Item 7.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

The information called for by this item is filed at Exhibit 13 to this report
and is incorporated in its entirety by reference under this Item 7A.

Item 8.  Financial Statements and Supplementary Data

Our consolidated financial statements and notes to these statements are filed at
Exhibit 13 to this report and are incorporated in their entirety by reference
under this Item 8.

Our supplementary data is filed at Exhibit 13 to this report and is incorporated
in its entirety by reference under this Item 8.


PART III.

Item 10. Directors and Executive Officers of the Registrant

Directors

At February 28, 2001, we had nine directors.

Our directors are divided into three classes: three directors are in Class 1;
three directors are in Class 2; and three directors are in Class 3. Each
director holds office for a three-year term. The terms of the classes are
staggered, so that the term of office of one class expires each year.

The following information includes the age of each of our current directors and
those persons who have been nominated to become a director upon their election
at our 2001 annual meeting of stockholders. All of our current directors are
also nominees for director.

                                       18
<PAGE>   21
<TABLE>
<CAPTION>
             Name                                Age             Principal Occupation          Director Since

<S>                                              <C>      <C>                                  <C>
         Don E. Bangs                            69       Secretary of the Corporation and          1985
                                                          the bank.  Former owner of Bangs
                                                          Insurance Agency and former agent
                                                          for The Thrush Insurance Agency.

         Robert M. Brewington, Jr.               50       Owner of Sutliff Motors (sales
                                                          and service of cars and trucks;           1996
                                                          school bus contractor).

         Edward L. Campbell                      62       President of ELC Enterprises,
                                                          Inc., doing business as The               1985
                                                          Heritage House Family Restaurant,
                                                          and the sole proprietor of
                                                          Heritage Acres Christmas tree
                                                          sales.

         Edward R. Harding, Jr.                  54       Partner of Harding & Associates           1984
                                                          (law firm) and President of
                                                          Inter-County Land Abstract Co.,
                                                          Inc. (title insurance).

         William F. Hess                         67       Chairman and former Vice Chairman         1983
                                                          of the Corporation and the bank.
                                                          Dairy farmer.

         Rodney B. Keller                        50       Community Development Director
                                                          for PPL Corp.                             2000

         Willard H. Kile, Jr., D.M.D.            46       Partner of Kile & Robinson LLC            2000
                                                          (dentists); Partner of Kile &
                                                          Kile Real Estate.

         Charles E. Long                         65       Retired.  Former President of             1993
                                                          Long Supply Co., Inc. (a
                                                          wholesaler and retailer of
                                                          hardware and masonry products).

         Paul E. Reichart                        63       President, Chief Executive                1983
                                                          Officer and Vice Chairman of the
                                                          Corporation and the bank.
</TABLE>

                                       19
<PAGE>   22
Principal Officers

Our principal officers are appointed by the Board of Directors and serve at the
will of the Board of Directors, subject to certain change in control agreements
discussed later in this report. The following information is presented for our
principal officers:
<TABLE>
<CAPTION>
                                                 Held Since      Employee
   Name & Position                                                  Since        Age
<S>                                              <C>             <C>            <C>
William F. Hess
Chairman                                           1998             *            67
Paul E. Reichart
President and CEO                                  1985           1960           63
Don E. Bangs
Secretary                                          1993             *            69
Virginia D. Kocher
Treasurer                                          1991           1972           53
</TABLE>
------------
* Not an employee of the Company and the Bank.

Compliance with Section 16(a) of the Securities Exchange Act of 1934

Executive officers and directors and "beneficial owners" of more than ten
percent of our common stock must file initial reports of ownership and reports
of changes in ownership with the SEC pursuant to Section 16(a).

We have reviewed the reports and written representations from the executive
officers and directors. Based on this review, we believe that all filing
requirements were met during 2000.

Item 11. Executive Compensation

This section of the report contains charts that show the amount of compensation
earned by our executive officers whose salary and bonus exceeded $100,000 for
2000. It also contains the performance graph comparing our performance relative
to a peer group and the report of our human resource committee explaining the
compensation philosophy for our most highly paid officers.

                          SUMMARY COMPENSATION TABLE(1)

<TABLE>
<CAPTION>
                               Annual                      Compensation

Name and Principal             Fiscal                                      Other Annual             All Other
Position                       Year     Salary($)      Bonus($)          Compensation(2)($)     Compensation(3)($)
<S>                            <C>      <C>            <C>               <C>                    <C>
Paul E. Reichart               2000      94,439        31,598(4)              9,600                  4,284
President and Chief            1999      90,895        23,653(5)              8,400                  4,131
Executive Officer              1998      88,247        19,920(6)              8,800                  3,542
</TABLE>

-------------------

(1)      From January 1, 1998 through December 31, 2000, the Corporation did not
         pay any long-term compensation in the form of stock options, stock
         appreciation rights, restricted stock or any other long-term
         compensation, nor did it make any long-term incentive plan payments.
         Accordingly, no such information is presented in the summary
         compensation table set forth above. No such arrangements are currently
         in effect.

(2)      Represents the payment of directors' fees by the bank for the years
         presented. Mr. Reichart did not receive perquisites and other personal
         benefits, securities and property that totaled in the aggregate for the
         years presented either $50,000 or 10% of the total of the amounts
         reported under the salary and bonus columns. Therefore, the amounts for
         such perquisites and other personal benefits, securities and property
         are not reported.

(3)      These figures represent annual term insurance premium payments on the
         life of Mr. Reichart.

(4)      Includes 15,000 as a life insurance premium payment for a deferred
         compensation plan; $4,212 as a cash bonus representing 4% of base
         salary; $5,430 as a contribution to the bank's profit sharing plan;
         $1,300 representing 50% up to 3% matching contribution to Mr.
         Reichart's 401K plan; $718 representing car expense; and $4,938
         representing cafeteria plan benefits.

(5)      Includes 9,977 as a life insurance premium payment for a deferred
         compensation plan; $1,851 as a cash bonus representing 2% of base
         salary; $4,941 as a contribution to the bank's profit sharing plan;
         $1,350 representing 50% up to 3% matching contribution to Mr.
         Reichart's 401K plan; $865 representing car expense; and $4,669
         representing cafeteria plan benefits.

(6)      Includes $5,364 as a life insurance premium payment for a deferred
         compensation plan; $3,459 as a cash bonus representing 4% of base
         salary; $4,455 as a contribution to the bank's profit sharing plan;
         $1,300 representing 50% up to 3% matching contribution to Mr.
         Reichart's 401K plan; $854 representing car expense; and $4,488
         representing cafeteria plan benefits

                                       20
<PAGE>   23
                             EXECUTIVE COMPENSATION

Human Resource Committee Report

Executive compensation for the officers of the Company and the Bank is
determined by the Human Resource Committee of the Company's Board of Directors.
Salaries and bonuses for the executive officers are reviewed annually. All
executive compensation is paid by the Bank to the applicable executive.

Compensation Philosophy

Our executive compensation philosophy is designed to attract, retain, and
motivate the best managerial talent available in line with three central themes:
alignment, accountability, and attraction.

         -        Alignment with the long-term interests of our stockholders;

         -        Accountability for results by linking executives to the
                  Company and individual performance; and

         -        Attraction, motivation and retention of critical talent.

The Human Resource Committee annually conducts a full review of our executives
and their performance in determining compensation levels. For 2000, the Human
Resource Committee considered various qualitative and quantitative indicators of
the Company and individual performance in determining the level of compensation
for President and Chief Executive Officer and other executive officers. The
review included an evaluation of the Company's performance both on a short- and
long-term basis. This review included an analysis of quantitative measures, such
as Return on Equity. The Human Resource Committee considered also qualitative
measures such as leadership, experience, strategic direction, community
representation and social responsibility. The Human Resource Committee has been
sensitive to management's maintaining a balance between actions that foster
long-term value creation and short-term performance. In addition, the Human
Resource Committee evaluates total executive compensation in light of the
operational and financial performance and compensation practices of the
commercial banking industry in the Pennsylvania region.

Base salaries are reviewed each year and generally adjusted relative to
individual performance and competitive salaries with the commercial banking
industry in the Pennsylvania region.

A base salary increase of 4.19% was made to all executives in 2000. Actual
salaries will continue to be set according to the scope of the responsibilities
of each executive officer's position.

Deferred Compensation Agreements for Executive Officers

Paul E. Reichart has served as our and the Bank's President and Chief Executive
Officer since 1985. Mr. Reichart was named Vice Chairman in 1998. J. Jan Girton
has served as the Executive Vice President, Chief Operating Officer and
Assistant Secretary of the Bank since 1987. As a result of Messrs. Reichart's
and Girton's active involvement and experience in the affairs of the Bank, the
Bank has depended upon, and continues to depend upon, their continued
employment. The Bank does not maintain employment agreements or key man
insurance, other than the deferred compensation agreements described below, with
respect to Messrs. Reichart and Girton. In 1992, the Bank entered into
agreements with Paul E. Reichart, President and Chief Executive Officer of the
Company and the Bank, and J. Jan Girton, Executive Vice President, Chief
Operating Officer and Assistant Secretary of the Bank, to establish a
non-qualified deferred compensation plan for these officers.

Each officer is deferring compensation in order to participate in his deferred
compensation plan. If the officer continues to serve as an officer of the Bank
until he attains 65 years of age, the Bank has agreed to pay him 120 guaranteed
consecutive monthly payments commencing on the first day of the month following
the officer's 65th birthday. Each officer's guaranteed monthly payment is based
upon the future value of life insurance purchased with the compensation the
officer has deferred. If the officer attains 65 years of age but dies before
receiving all of the guaranteed monthly payments, then the Bank will make the
remaining payments to the officer's designated
                                       21
<PAGE>   24
beneficiary or to the representative of his estate. In the event that the
officer dies while serving as an officer, but prior to age 65 years of age, then
the Bank will remit the guaranteed monthly payments to the officer's designated
beneficiary or to the representative of his estate. The Bank has obtained life
insurance (designating the bank as the beneficiary) on the life of each
participating officer in an amount which is intended to cover the Bank's
obligations under the deferred compensation plan, based upon certain actuarial
assumptions. In 2000, the Bank accrued $25,800 as an expense for the deferred
compensation plan.

FIVE YEAR PERFORMANCE GRAPH

The following graph and table compare the cumulative total stockholder return on
our common stock during the six-year period ending on December 31, 2000, with
(i) the cumulative total return on the SNL Securities Corporation Performance
Index (1) for 35 publicly-traded banks with under $250 million in total assets
in the Middle Atlantic area (2), and (ii) the cumulative total return for all
United States stocks traded on the NASDAQ Stock market. The comparison assumes
the value of the investment in our common stock and each index was $100 on
December 31, 1995, and assumes further the reinvestment of dividends into the
applicable securities. The stockholder return shown on the graph and table below
is not necessarily indicative of future performance.


                                       22
<PAGE>   25
                                  [LINE GRAPH]
<TABLE>
<CAPTION>
                                                                         Period Ending
                                          --------------------------------------------------------------------------------
Index                                          12/31/95    12/31/96    12/31/97    12/31/98     12/31/99    12/31/00
--------------------------------------------------------------------------------------------------------------------------
<S>                                            <C>         <C>         <C>         <C>          <C>         <C>
CCFNB Bancorp, Incorporated                      100.00      105.47      146.88      160.94       125.00      103.13
NASDAQ - Total US*                               100.00      123.04      150.69      212.51       394.92      237.62
SNL <$250M Bank Index                            100.00      126.34      206.17      195.98       172.09      170.38
</TABLE>
------------------

*Source: CRSP, Center for Research in Security Prices, Graduate School of
Business, The University of Chicago 2001. Used with permission. All rights
reserved. crsp.com.

       SNL Securities LC                                          (804) 977-1600
(C)2001
------------------

Notes:

A.       The lines represent monthly index levels derived from compounded daily
         returns that include all dividends.

B.       The indexes are reweighted daily, using the market capitalization on
         the previous trading day.

C.       If the monthly interval, based on the fiscal year-end, is not a trading
         day, the preceding day is used.

D.       The index level for all series was set to $100 on 12/31/95.


------------------

(1)      SNL Securities is a research and publishing firm specializing in the
         collection and dissemination of data on the banking, thrift and
         financial services industries.

(2)      The Middle Atlantic area comprises the states of Delaware,
         Pennsylvania, Maryland, New Jersey and New York, the District of
         Columbia and Puerto Rico

                                       23
<PAGE>   26
Item     12. Security Ownership of Certain Beneficial Owners and Management

This section describes how much stock our directors, executive officers own. It
also describes the persons or entities that own more than 5% of our voting
stock.

Stock Owned By Directors, Nominees for Director And Executive Directors

This table indicates the number of shares of common stock owned by the
directors, nominees for director and executive officers as of February 28, 2001.
The aggregate number of shares owned by all directors and executive officers is
4.41%. Unless otherwise noted, each individual has sole voting and investment
power for the shares indicated below.

<TABLE>
<CAPTION>
           Name of Individual                     Amount and Nature of
          of Identity of Group                   Beneficial Ownership(1)                   Percent of Class

<S>                                              <C>                                       <C>
Don E. Bangs                                            8,344.626                                ----

Robert M. Brewington, Jr.                               7,226.163                                ----

Edward L. Campbell                                      6,055.904                                ----

Elwood R. Harding, Jr.                                 15,457.901                               1.15%

William F. Hess                                         4,292.981                                ----

Rodney B. Keller                                          577.747                                ----

Willard H. Kile, Jr.                                    2,505.484                                ----

Virginia D. Kocher                                        391.000                                ----

Charles E. Long                                         6,425.882                                ----

Paul E. Reichart                                        8,020.000                                ----

All Officers and Directors as a group
   (9 directors, 3 nominees, 4 officers,
   10 persons in total)                                59,297.688                               4.41%
</TABLE>

------------------

(1)      Includes shares held (a) directly, (b) jointly with a spouse, (c)
         individually by spouse, (d) by the transfer agent in the Corporation's
         dividend reinvestment account, and (e) in various trusts.

Voting Stock Owned by "Beneficial Owner"

We know of no persons or entities who own beneficially more than five percent of
our common stock as of February 28, 2001.

Item     13. Certain Relationships and Related Transactions

We encourage our directors and executive officers to have banking and financial
transactions with the Bank. All of these transactions are made on comparable
terms and with similar interest rates as those prevailing for other customers.

The total consolidated loans made by the Bank at December 31, 2000, to its
directors and officers as a group, members of their immediate families and
companies in which they have a 10% or more ownership interest was $6,605,617 or
26.4% of our total consolidated capital accounts. The largest amount for all of
these loans in 2000 was $8,205,415 million or 32.8% of our total consolidated
capital accounts. These loans did not involve more than the normal risk of
collectibility nor did they present other unfavorable features.

                                       24
<PAGE>   27
PART IV.

Item     14. Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a)      1. Our consolidated financial statements and notes to these statements
as well as the applicable reports of the independent certified public
accountants are filed at Exhibit 13 to this report and are incorporated in their
entirety by reference under this Item 14(a)1.

         2. All schedules are omitted because they are not applicable or the
required information is shown in the financial statements or notes to these
statements.

         3. The exhibits required by Item 601 of Regulation S-K are included
under Item 14(c) to this report.

(b)      Reports on Form 8-K

We filed no current reports on Form 8-K during the quarter ended December 31,
2000.

(c)      Exhibits required by Item 601 of Regulation S-K:

<TABLE>
<CAPTION>
       Exhibit Number Referred to
       Item 601 of Regulation SK                                 Description of Exhibit
<S>                                                              <C>
                             2                                        None.
                             3                                        None.
                             4                                        None.
                             9                                        None.
                            10                                        None.
                            11                                        None.
                            12                                        None.
                            13                               Portions of the Annual Report to Stockholders for
                                                             Fiscal Year Ended December 31, 2000.
                            16                                        None.
                            18                                        None.
                            21                               List of Subsidiaries of the Company.
                            22                                        None.
                            23                                        None.
                            24                                        None.
                            99                               SEC Guide 3 Financial Information.
</TABLE>


By order of the Board of Directors

                                   SIGNATURES

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

CCFNB BANCORP, INC.
         (Bancorp)


By:      /s/ Paul E. Reichart                             Date:    March 8, 2001
         --------------------
         Paul E. Reichart
         President, Chief Executive Officer and
         Vice Chairman of the Board

                                       25
<PAGE>   28
         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.



By:      /s/ Don E. Bangs                                 Date:    March 8, 2001
        ---------------------
         Don E. Bangs
         Director and Secretary



By:      /s/ Robert M. Brewington, Jr.                    Date:    March 8, 2001
         ---------------------
         Robert M. Brewington, Jr.
         Director



By:      /s/ Edward L. Campbell                           Date:    March 8, 2001
         ---------------------
         Edward L. Campbell
         Director



By:      /s/ Elwood R. Harding, Jr.                       Date:    March 8, 2001
         ---------------------
         Elwood R. Harding, Jr.
         Director



By:      /s/ William F. Hess                              Date:    March 8, 2001
         ---------------------
         William F. Hess
         Director  and Chairman of the Board



By:      /s/ Rodney B. Keller                             Date:    March 8, 2001
         ---------------------
         Rodney B. Keller
         Director



By:      /s/ Willard H. Kile, Jr., DMD                    Date:    March 8, 2001
         ---------------------
         Willard H. Kile, Jr., DMD
         Director



By:      /s/ Charles E. Long                              Date:    March 8, 2001
         ---------------------
         Charles E. Long
         Director

                                       26
<PAGE>   29
By:      /s/ Paul E. Reichart                             Date:    March 8, 2001
         ---------------------
         Paul E. Reichart
         Director , President, Chief Executive Officer
         and Vice Chairman of the Board
         (Chief Executive Officer)



By:      /s/ Virginia D. Kocher                           Date:    March 8, 2001
         ---------------------
         Virginia D. Kocher
         Treasurer
         (Principal Financial and Accounting Officer)

                                       27
<PAGE>   30
                                INDEX TO EXHIBITS


<TABLE>
<CAPTION>
    Item Number      Description                                                   Page

<S>                  <C>                                                           <C>
        13           Portions of the Annual Report to Stockholders for the
                     Fiscal Year Ended December 31, 2000............................29
        21           List of Subsidiaries of the Company............................66
        99           SEC Guide 3 Financial Information..............................67
</TABLE>

                                       28