FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

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


For the quarterly period ended September 30, 2002

                                       OR

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

For the transition period from              to
                                -----------    -----------
Commission File No.  0-19618

                        FIRST COMMUNITY BANCSHARES, INC.
             (Exact name of registrant as specified in its charter)

Indiana 35-1833586 (State or other jurisdiction of incorporation or (IRS
Employer Identification No.)
organization)

                                136 East Harriman
                             Bargersville, IN 46106
                    (Address of principal executive offices)
                                   (Zip Code)
                                 (317) 422-5171
              (Registrant's telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Sections 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months, and (2) has been subject to such filing
requirements for the past 90 days.

                             Yes  X  No
                                 ---    ---

Outstanding Shares of Common Stock on November 1, 2002          1,044,926


<PAGE>

                FIRST COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
                                    FORM 10-Q

                                      INDEX
                                                                        Page No.
                                                                        -------

Forward Looking Statement.....................................................3

Part I. Financial Information:

    Item 1.  Financial Statements:

               Consolidated Condensed Balance Sheets..........................4

               Consolidated Condensed Statements of Income....................5

               Consolidated Condensed Statements of Comprehensive Income .....6

               Consolidated Condensed Statements of Stockholders' Equity......7

               Consolidated Condensed Statements of Cash Flows................8

               Notes to Unaudited Consolidated Condensed Financial Statements.9

    Item 2.  Management's Discussion and Analysis of Financial
                   Condition and Results of Operations.......................10

    Item 3.  Quantitative and Qualitative Disclosures About Market Risk......15

    Item 4.  Controls and Procedures.........................................15

Part II.  Other Information:

    Item 1.  Legal Proceedings...............................................16

    Item 2.  Changes In Securities...........................................16

    Item 3.  Defaults Upon Senior Securities.................................16

    Item 4.  Submission of Matters to a Vote of Security Holders.............16

    Item 5.  Other Information...............................................16

    Item 6.  Exhibits and Reports on Form 8-K................................16

Signatures...................................................................16

Certification pursuant to the Sarbanes-Oxley Act of 2002.....................17

Certification of Controls and Procedures.....................................17

                                       2

<PAGE>

                            FORWARD LOOKING STATEMENT

This Quarterly Report on Form 10-Q ("Form 10-Q") contains statements which
constitute forward looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements appear in a number of
places in this Form 10-Q and include statements regarding the intent, belief,
outlook, estimate or expectations of the Company (as defined below), its
directors or its officers primarily with respect to future events and the future
financial performance of the Company. Readers of this Form 10-Q are cautioned
that any such forward looking statements are not guarantees of future events or
performance and involve risks and uncertainties, and that actual results may
differ materially from those in the forward looking statements as a result of
various factors. The accompanying information contained in this Form 10-Q
identifies important factors that could cause such differences. These factors
include changes in interest rates; loss of deposits and loan demand to other
financial institutions; substantial changes in financial markets; changes in
real estate values and the real estate market; the status of the economy in our
market area; decisions made with respect to the classification of loans and the
amount of our loan loss reserves; or regulatory changes.





                                       3

<PAGE>

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

                FIRST COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
                      Consolidated Condensed Balance Sheet

<TABLE>
<CAPTION>
                                                                      September 30,      December 31,
                                                                           2002             2001
                                                                     --------------------------------
                                                                       (Unaudited)
<S>                                                                  <C>                <C>
Assets
     Cash and due from banks                                         $   6,648,693      $   1,683,913
     Short-term interest-bearing deposits                                1,951,033          5,003,537
                                                                     --------------------------------
         Cash and cash equivalents                                       8,599,726          6,687,450

     Investment securities available for sale                            3,441,362          3,968,964
     Mortgage loans held for sale                                          359,390            554,261
     Loans                                                             128,360,426        127,241,655
         Allowance for loan losses                                      (1,251,795)        (1,114,466)
                                                                     --------------------------------
              Net loans                                                127,108,631        126,127,189
     Premises and equipment                                              4,336,358          4,564,691
     Federal Home Loan Bank of Indianapolis stock, at cost               1,025,000          1,025,000
     Interest receivable                                                   706,738            849,933
     Cash value of life insurance                                        2,510,154          2,432,547
     Other assets                                                        1,170,641          1,167,454
                                                                     --------------------------------

         Total assets                                                $ 149,258,000      $ 147,377,489
                                                                     ================================

Liabilities
     Deposits
         Noninterest-bearing                                         $  13,488,048      $  11,037,797
         Interest-bearing                                              107,929,799        106,685,724
                                                                     --------------------------------
              Total deposits                                           121,417,847        117,723,521
     Federal Home Loan Bank of Indianapolis advances                    13,500,000         15,500,000
     Other borrowings                                                    2,532,146          2,555,914
     Interest payable                                                      229,644            298,583
     Other liabilities                                                   1,073,019          1,108,065
                                                                     --------------------------------
         Total liabilities                                             138,752,656        137,186,083
                                                                     --------------------------------

Commitments and Contingent Liabilities

Stockholders' Equity
     Preferred stock, no-par value
         Authorized and unissued - 1,000,000 shares
     Common stock, no-par value
         Authorized - 4,000,000 shares
         Issued and outstanding - 1,044,926 and 1,042,926 shares         7,058,865          7,043,990
     Retained earnings and contributed capital                           3,387,765          3,145,348
     Accumulated other comprehensive income                                 58,714              2,068
                                                                     --------------------------------
         Total stockholders' equity                                     10,505,344         10,191,406
                                                                     --------------------------------

         Total liabilities and stockholders' equity                  $ 149,258,000      $ 147,377,489
                                                                     ================================
</TABLE>

See notes to consolidated condensed financial statements.

                                       4

<PAGE>

                FIRST COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
                   Consolidated Condensed Statements of Income
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                           Three Months Ended             Nine Months Ended
                                                             September 30,                  September 30,
                                                      ------------------------------------------------------------
                                                          2002            2001           2002           2001
                                                      ------------------------------------------------------------
<S>                                                   <C>            <C>             <C>            <C>
Interest Income
     Loans, including fees                            $  2,415,090   $  2,781,189    $  7,167,511   $  8,320,127
     Investment securities
         Taxable                                            29,961          9,784          69,104         47,546
         Tax exempt                                         30,962         55,171          97,220        243,281
     Interest-bearing time deposits                         14,036         17,952          58,409         84,197
     Dividends                                              16,147         18,263          48,506         55,896
                                                      ------------------------------------------------------------
         Total interest income                           2,506,196      2,882,359       7,440,750      8,751,047
                                                      ------------------------------------------------------------

Interest Expense
     Deposits                                              714,904      1,125,798       2,307,675      3,923,379
     FHLB advances                                         195,186        230,656         584,029        675,478
     Other borrowings                                       46,252         46,857         139,103        140,053
                                                      ------------------------------------------------------------
         Total interest expense                            956,342      1,403,311       3,030,807      4,738,910
                                                      ------------------------------------------------------------

Net Interest Income                                      1,549,854      1,479,048       4,409,943      4,012,137
     Provision for loan losses                              60,000        118,750         921,500        222,250
                                                      ------------------------------------------------------------
Net Interest Income After Provision for Loan Losses      1,489,854      1,360,298       3,488,443      3,789,887
                                                      ------------------------------------------------------------

Other Income
     Trust fees                                              7,358          8,456          28,158         30,606
     Gain on sale of loans                                  58,753          7,321         112,725         11,969
     Service charges on deposit accounts                   214,746        173,926         585,838        514,214
        Gain on sale of securities                          48,077         33,018          48,077         45,540
        Non-customer ATM fee income                         45,457         42,327         121,999        113,477
     Other operating income                                106,190         30,648         257,197        102,658
                                                      ------------------------------------------------------------
         Total other income                                480,581        295,696       1,153,994        818,464
                                                      ------------------------------------------------------------

Other Expenses
     Salaries and employee benefits                        649,152        600,737       1,958,610      1,768,124
     Premises and equipment                                182,223        174,491         533,237        525,059
     Advertising                                            30,396         33,878          90,517         96,953
     Data processing fees                                  187,836        167,855         554,463        479,939
     Deposit insurance expense                               5,095         14,821          15,437         45,155
     Printing and office supplies                           35,325         42,970         124,218        121,165
     Legal and professional fees                            48,303         39,227         186,171        149,382
     Telephone expense                                      28,909         29,094          85,935         88,722
     Other operating expense                               164,504        148,880         496,845        434,648
                                                      ------------------------------------------------------------
         Total other expenses                            1,331,743      1,251,953       4,045,433      3,709,147
                                                      ------------------------------------------------------------

Income Before Income Tax                                   638,692        404,041         597,004        899,204
     Income tax expense                                    218,332        131,168         145,799        234,990
                                                      ------------------------------------------------------------

Net Income                                            $    420,360   $    272,873     $   451,205    $   664,214
                                                      ============================================================

Basic earnings per share                              $        .40   $        .26     $       .43    $       .64
Diluted earnings per share                            $        .38   $        .25     $       .43    $       .61
Dividends per share                                   $        .05   $        .04     $       .20    $       .12
</TABLE>

See notes to consolidated condensed financial statements.

                                       5

<PAGE>

                FIRST COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
            Consolidated Condensed Statements of Comprehensive Income
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                              Three Months Ended               Nine Months Ended
                                                                 September 30,                   September 30,
                                                        --------------------------------------------------------------
                                                             2002             2001            2002             2001
                                                        --------------------------------------------------------------
<S>                                                      <C>              <C>            <C>               <C>
  Net income                                             $  420,360       $  272,873     $  451,205        $  664,214
  Other comprehensive income, net of tax
       Unrealized holding gains arising during the
       period, net of tax expense of $24,467,
       $7,487, $56,198 and $75,108                           37,302           11,419         85,680           114,510
       Less:  Reclassification adjustment for gains
       included in net income, net of tax benefit
                expense of  $19,043, $13,075, $19,043
                and $18,034                                 29,034           19,943          29,034            27,506
                                                        --------------------------------------------------------------
                                                              8,268           (8,524)        56,646            87,004
                                                        --------------------------------------------------------------
   Comprehensive income                                  $  428,628       $  264,349     $  507,851        $  751,218
                                                        ==============================================================
</TABLE>



See notes to consolidated condensed financial statements

                                       6

<PAGE>

                FIRST COMMUNITY BANCSHARES, INC AND SUBSIDIARIES
            Consolidated Condensed Statement of Stockholders' Equity
                  For the Nine Months Ended September 30, 2002
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                       Retained
                                             Common Stock              Earnings         Accumulated
                                     ------------------------------       And              Other
                                        Shares                        Contributed      Comprehensive
                                      Outstanding       Amount          Capital           Income          Total
                                     ------------------------------------------------------------------------------
<S>                                   <C>              <C>             <C>                <C>          <C>
Balances, January 1, 2002             1,042,926        $7,043,990      $3,145,348         $ 2,068      $10,191,406

    Net income for the period                                             451,205                          451,205
    Unrealized gains on securities                                                         56,646           56,646
    Cash dividends                                                       (208,788)                        (208,788)
     Options exercised, net of cost       2,000            14,875                                           14,875
                                     ------------------------------------------------------------------------------

Balances, September 30, 2002          1,044,926        $7,058,865      $3,387,765       $  58,714     $ 10,505,344
                                     ==============================================================================
</TABLE>







See notes to consolidated condensed financial statements.

                                       7

<PAGE>

                FIRST COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
                 Consolidated Condensed Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                               Nine Months Ended
                                                                                  September 30,
                                                                         ------------------------------
                                                                              2002              2001
                                                                         ------------------------------
<S>                                                                      <C>               <C>
Operating Activities
     Net income                                                          $    451,205      $    664,214
     Adjustments to reconcile net income to net cash provided by
        operating activities
       Provision for loan losses                                              921,500           222,250
       Depreciation and amortization                                          271,417           278,264
       Investment securities amortization                                      28,627            43,494
            Gain on sale of securities                                        (48,077)          (45,540)
         Net change in:
            Cash value of life insurance                                      (77,607)          (57,780)
            Interest receivable                                               143,195           218,010
            Interest payable                                                  (68,939)         (138,640)
            Mortgage loans held for sale                                      194,871        (1,549,362)
         Other  adjustments                                                   (77,978)          294,868
                                                                         ------------------------------
              Net cash provided by (used in) operating activities           1,738,214           (70,222)
                                                                         ------------------------------

Investing Activities
     Proceeds from paydowns,  maturities, and sales of securities
        available-for-sale                                                  3,704,744         6,362,193
     Purchases of securities available-for-sale                            (3,063,302)                0
     Proceeds from paydowns,  maturities, and sales of securities
        held-to-maturity                                                            0           150,769
        Purchases of FHLB stock                                                     0          (247,200)
     Net change in loans                                                   (2,209,033)       (3,829,169)
     Purchases of property and equipment                                      (43,084)          (75,776)
     Proceeds received from sale of other real estate                         255,846                 0
                                                                         ------------------------------
              Net cash provided by (used in) investing activities          (1,354,829)        2,360,817
                                                                         ------------------------------

Financing Activities
     Net change in
       Noninterest-bearing, NOW and savings deposits                       13,226,902         2,766,830
       Certificates of Deposit                                             (9,532,576)       (7,481,074)
     Proceeds from borrowings                                                       0         8,000,000
     Repayment of borrowings                                               (2,023,768)       (5,522,522)
     Cash dividends                                                          (156,542)         (124,909)
     Rights and options exercised, net of costs                                14,875            20,625
                                                                         ------------------------------
              Net cash provided by (used in)  financing activities          1,528,891        (2,341,050)
                                                                         ------------------------------

Net Change in Cash and Cash Equivalents                                     1,912,276           (50,455)

Cash and Cash Equivalents, Beginning of Period                              6,687,450         4,886,382
                                                                         ------------------------------

Cash and Cash Equivalents, End of Period                                 $  8,599,726      $  4,835,927
                                                                         ==============================

Supplemental cash flow disclosures
       Interest paid                                                     $  3,099,746      $  4,877,550
       Held-to-maturity securities transferred to available-for-sale
         securities                                                                 0         1,196,445
       Income tax paid                                                        410,900                 0
       Loans transferred to real estate owned                                 241,927           305,091
       Loans to finance the sale of real estate owned                          87,300            98,790
       Dividend payable                                                        52,246            41,717
</TABLE>

See notes to consolidated condensed financial statements.

                                       8

<PAGE>

                FIRST COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
         Notes to Unaudited Consolidated Condensed Financial Statements
                               September 30, 2002


Note 1: Basis of Presentation
-----------------------------

The consolidated financial statements include the accounts of First Community
Bancshares, Inc. (the "Company") and its wholly owned subsidiaries, First
Community Bank & Trust, a state chartered bank (the "Bank") and First Community
Real Estate Management, Inc. ("FCREMI"). FCREMI holds and manages real estate
used by the Company and the Bank. A summary of significant accounting policies
is set forth in Note 1 of Notes to Financial Statements included in the December
31, 2001, Annual Report to Stockholders. All significant intercompany accounts
and transactions have been eliminated in consolidation.

The interim consolidated financial statements have been prepared in accordance
with instructions to Form 10-Q, and therefore do not include all information and
footnotes necessary for a fair presentation of financial position, results of
operations and cash flows in conformity with generally accepted accounting
principles.

The interim consolidated financial statements at September 30, 2002, and for the
three and nine months ended September 30, 2002 and 2001, have not been audited
by independent accountants, but reflect, in the opinion of management, all
adjustments (which include only normal recurring adjustments) necessary to
present fairly the financial position, results of operations and cash flows for
such periods. The results of operations for the three and nine months ended
September 30, 2002 are not necessarily indicative of the results to be expected
for the full year. The consolidated condensed balance sheet of the Company as of
December 31, 2001 has been derived from the audited consolidated balance sheet
of the Company as of that date.

Note 2: Earnings Per Share
--------------------------
<TABLE>
<CAPTION>
                                                Three Months Ended                           Three Months Ended
                                                September 30, 2002                           September 30, 2001
                                                ------------------                           ------------------
                                                    Weighted                                       Weighted
                                                    Average       Per Share                        Average     Per Share
                                         Income      Shares         Amount             Income       Shares       Amount
                                         ------      ------         ------             ------       ------       ------
<S>                                      <C>           <C>        <C>                 <C>           <C>           <C>
Basic earnings  per share
      Income available to
            common stockholders          $ 420,360     1,044,926  $    .40            $ 272,873     1,042,154     $ .26
                                                                  =========                                    =========

Effect of dilutive stock options                             609                                          505
Effect of convertible debt            10,568              90,910                     10,568            90,910
                                      ---------------------------                    ------------------------
Diluted earnings  per share
      Income available to common
       stockholders and assumed
       conversions                       $ 430,928     1,136,445     $ .38            $ 283,441     1,133,569     $ .25
                                      =====================================          ===================================
</TABLE>

                                       9

<PAGE>

<TABLE>
<CAPTION>
                                                 Nine Months Ended                            Nine Months Ended
                                                September 30, 2002                           September 30, 2001
                                                ------------------                           ------------------
                                                   Weighted                                        Weighted
                                                    Average       Per Share                        Average     Per Share
                                        Income      Shares          Amount             Income       Shares       Amount
                                        ------      ------          ------             ------       ------       ------
<S>                                    <C>             <C>           <C>              <C>           <C>           <C>
Basic earnings per share
      Income available to common
       stockholders                    $ 451,205       1,043,842     $ .43            $ 664,214     1,040,131     $ .64
                                                                  =========                                    =========

Effect of dilutive stock options                           1,348                                          253
Effect of convertible debt                31,704          90,910                         31,704        90,910
                                      ---------------------------                    -------------------------
Diluted earnings per share
      Income available to  common
       stockholders and assumed
       conversions                      $482,909       1,136,100     $ .43            $ 695,918     1,132,294     $ .61
                                      =====================================          ===================================
</TABLE>


Item 2.           Management's Discussion and Analysis of Financial Condition
-------           and Results of Operations
                  -----------------------------------------------------------

General
-------

The Bank is a subsidiary of the Company and operates as an Indiana commercial
bank. In 1998, the Company formed a new subsidiary, First Community Real Estate
Management, Inc. whose purpose is to purchase and lease back to the Bank
properties originally owned by the Bank thereby allowing the Bank to redeploy
its capital to other uses. The Bank makes monthly lease payments to FCREMI as
lessee of these locations. These lease payments are sufficient to service the
debt incurred by FCREMI to purchase these properties. As a bank holding company,
the Company depends upon the operations of its subsidiaries for all revenue and
reports its results of operations on a consolidated basis with its subsidiaries.

The Bank's profitability depends primarily upon the difference between the
income on its loans and investments and the cost of its deposits and borrowings.
This difference is referred to as the spread or net interest margin. The
difference between the amount of interest earned on loans and investments and
the interest incurred on deposits and borrowings is referred to as net interest
income. Interest income from loans and investments is a function of the amount
of loans and investments outstanding during the period and the interest rates
earned. Interest expense related to deposits and borrowings is a function of the
amount of deposits and borrowings outstanding during the period and the interest
rates paid.

Critical Accounting Policies
----------------------------

The notes to the consolidated financial statements contain a summary of the
Company's significant accounting policies presented on pages F-7 through F-9 of
the Annual Report to Stockholders for the year ended December 31, 2001. Certain
of these policies are important to the portrayal of the Company's financial
condition, since they require management to make difficult, complex or
subjective judgements, some of which may relate to matters that are inherently
uncertain. At this time management believes that its critical accounting
policies include determining the allowance for loan losses.

The allowance for loan losses is a significant estimate that can and does change
based on management's assumptions about specific borrowers and current general
economic and business conditions, among other

                                       10

<PAGE>

factors. Management reviews the adequacy of the allowance for loan losses on at
least a quarterly basis. The evaluation by management includes consideration of
past loss experience, changes in the composition of the loan portfolio, the
current condition and amount of loans outstanding, identified problem loans and
the probability of collecting all amounts due.

The determination of the adequacy of the allowance for loan losses is based on
estimates that are particularly susceptible to significant changes in the
economic environment and market conditions. A worsening or protracted economic
decline would increase the likelihood of additional losses due to credit and
market risk and could create the need for additional loss reserves.


Financial Condition
-------------------

Total assets increased $1.9 million, or 1.3%, to $149.3 million at September 30,
2002, from $147.4 million at December 31, 2001. Net loans increased from $126.1
million on December 31, 2001 to $127.1 million on September 30, 2002. Deposits
increased from $117.7 million on December 31, 2001 to $121.4 million on
September 30, 2002, an increase of 3.1%. FHLB advances decreased $2.0 million or
12.9% during the same time frame. Stockholders' equity was $10.5 million at
September 30, 2002 as compared to $10.2 million at December 31, 2001.

The Bank has experienced demand in both its commercial and installment sections
of the loan portfolio during the nine months ended September 30, 2002. The
increase in net loans of $1.0 million was primarily funded by deposit growth.
Management may seek out alternative funding sources, such as FHLB advances, from
time to time when the terms of these funding sources outperform traditional
deposit terms in the Bank's primary markets or for asset-liability matching
purposes.


Results of Operations Comparison of Three Months Ended September 30, 2002
and September 30, 2001
-------------------------------------------------------------------------

The Company had a net income of $420,000 for the three months ended September
30, 2002 compared to net income of $273,000 for the three months ended September
30, 2001, an increase of $147,000 or 54%. This increase in net income is a
result of continued lowered interest rates and management's focus on increasing
non-interest income.

The Bank's net interest income increased from $1.5 million for the three months
ended September 30, 2001 to approximately $1.6 million for the three months
ended September 30, 2002, an increase of $71,000. This increase is primarily due
to the interest rate reductions that occurred during 2001 with interest rates
remaining at these lower levels throughout 2002. The Bank's deposits were able
to reprice in a higher proportion to the interest-earning assets, which repriced
during this same time frame.

The Company made a $60,000 provision for loan losses for the three months ended
September 30, 2002 compared to $119,000 for three months ended September 30,
2001, or a decrease of $59,000. The loan loss reserve calculations are reviewed
monthly by both the Bank's senior lending officer and the board of directors.
The calculations consider all loans in the portfolio, with special consideration
given to classified loans and non-performing loans. The Company believes the
current loan loss reserve levels are adequate at this time.

Management continued to focus on increasing non-interest income and holding
steady or reducing non-interest expenses during the quarter ended September 30,
2002. As a result of these efforts, non-interest income increased $185,000 or
63% from $296,000 for the three months ended September 30, 2001 to $481,000 for
the three months ended September 30, 2002. This increase was primarily due to:

                                       11

<PAGE>

o    Increased service charges on deposit accounts of $41,000
o    Increased realized gain on sale of loans of $52,000
o    Increased other operating income of $76,000 for the three months ended
     September 30, 2002.

The increase in service charges on deposit accounts is attributable to more
demand deposit accounts being serviced by the Bank coupled with fee change
differences between periods. The increases in other operating income is
primarily due to credit card merchant and interchange fees, and cash surrender
value increases on Company owned life insurance.

Non-interest expenses increased $80,000 during the quarter ended September 30,
2002, when compared to the quarter ended September 30, 2001. The increase
between periods was in primarily due to salaries and employee benefits expenses,
which increased to $649,000 at for the quarter ending September 30, 2002
compared to $601,000 for the same period ending September 30, 2001. Data
processing fees also increased to $188,000 for the three months ended September
30, 2002 from $168,000 for the three months ended September 30, 2001. These
increases are primarily related to servicing more demand deposit, savings
accounts, and loan accounts. Management has made a commitment to continue to
monitor all non-interest expenses to further reduce expenses when practicable.

Income taxes increased $87,000 for the three months ended September 30, 2002,
when compared to the same period in 2001 primarily due to an increase in pretax
income over the same period last year.


Results of Operations Comparison of Nine Months Ended September 30, 2002 and
September 30, 2001
-----------------------------------------------------------------------------

The Company reported net income of $451,000 for the nine months ended September
30, 2002, a decrease of $213,000 or 32% from the $664,000 reported for the nine
months ended September 30, 2001. Net interest income increased, $398,000, to
$4.4 million for the nine months ended September 30, 2002, compared to $4.0
million for the nine months ended September 30, 2001. This represents a 10%
increase between the two periods.

The Company made a $922,000 provision for loan losses for the nine months ended
September 30, 2002 compared to a $222,000 provision for the nine months ended
September 30, 2001. An increased provision was taken during the second quarter
and allocated to the commercial loan portfolio, which was necessary primarily
due to continued weakness in the general economy of the Indianapolis metro area
and due to the charge off of two loans that were partially unreserved. The
Company believes that there is potential for recovery of these charged off
loans, but the recoveries may be over several quarters. As previously discussed,
loan loss reserves are reviewed monthly by both the Bank's senior lending
officer and the board of directors.

Non-interest income increased by $336,000 or 41% for the nine months ended
September 30, 2002, compared to the year earlier period. Increases in number of
demand deposit and savings accounts being serviced along with operational
procedural changes have led to this improvement. The Company was servicing more
demand deposits during the nine months ended September 30, 2002 compared to the
year ago period. This increased volume in deposit servicing, coupled with fee
structural changes, have increased service charges collected on deposit accounts
by $72,000. The Company also recognized gains on the sale of loans of $113,000
during the nine months ended September 30, 2002, compared to a gain on the sale
of loans of $12,000 during the nine months ended September 30, 2001. The
increase in other operating income is primarily attributable to increases in
credit card merchant and interchange fees, and cash surrender value of Company
owned life insurance polices.

Non-interest expenses were $4.0 million for the nine months ended September 30,
2002, compared to $3.7 million during the nine months ended September 30, 2001.
The Company has seen increases in salaries,

                                       12

<PAGE>

premises, data processing, printing and office supplies, legal, and other
expenses while experiencing decreases in advertising, FDIC insurance, and
telephone expenses during the comparable periods. The increased data processing
fees can be attributed to servicing more demand, savings, and loan accounts. The
primary increase in non-interest expense is in salaries and benefits expense,
which increased $191,000 to $2.0 million during the nine months ended September
30, 2002, compared to $1.8 million during the nine months ended September 30,
2001. Management is continuing to monitor all expense areas and implementing
systems or procedural changes when deemed beneficial to the Company.

Income taxes decreased $89,000 for the nine months ended September 30, 2002,
when compared to the same period in 2001, primarily due to a decrease in pretax
income caused by an increased loan loss provision recorded in the second quarter
of 2002.

Asset Quality
-------------

The Bank currently classifies loans as "substandard", "doubtful" and "loss" to
assist management in addressing collection risks and pursuant to regulatory
requirements, which are not necessarily consistent with generally accepted
accounting principles. Substandard loans represent credits characterized by the
distinct possibility that some loss will be sustained if deficiencies are not
corrected. Doubtful loans possess the characteristics of substandard loans, but
collection or liquidation in full is doubtful based upon existing facts,
conditions and values. A loan classified as a loss is considered uncollectible.
As of September 30, 2002, the Bank had $4.4 million of loans classified as
substandard, none as doubtful and none as loss. The allowance for loan losses
was $1.3 million, or .98% of net loans receivable at September 30, 2002 compared
to $1.1 million or .88% of net loans receivable at December 31, 2001. A portion
of classified loans are non-accrual loans. First Community had non-accrual loans
totaling $1.8 million at September 30, 2002 compared to $1.6 million at December
31, 2001. All non-accrual loans are considered substandard.


Asset/Liability Management
--------------------------

One of the actions undertaken by the Company's management has been to adopt
asset/liability management policies in an attempt to reduce the susceptibility
of the Company's net interest spread to the adverse impact of volatile interest
rates. This goal can be achieved by attempting to match maturities (or
time-to-repricing) of assets with maturities or repricing of liabilities and
then actively managing any mismatch. Accomplishing this objective requires
attention to both the asset and liability sides of the balance sheet. The
difference between maturity of assets and maturity of liabilities is measured by
the interest-rate gap.

At September 30, 2002, the Company's one-year cumulative interest-rate gap as a
percent of total assets was a negative 4.9%. This negative interest-rate gap
represents substantial risk for the Company in an environment of rising interest
rates. A negative interest-rate gap means the Company's earnings are vulnerable
in periods of rising interest rates because during such periods the interest
expense paid on liabilities will generally increase more rapidly than the
interest income earned on assets. Conversely, in a falling interest-rate
environment, the total interest expense paid on liabilities will generally
decrease more rapidly than the interest income earned on assets. A positive
interest-rate gap would have the opposite effect.

Asset management goals have been directed toward obtaining a suitable balance of
asset quality, liquidity and diversification in order to stabilize and improve
earnings. The asset management strategy has concentrated on shortening the
maturity of its loan portfolio by increasing adjustable-rate loans and
short-term installment and commercial loans. However, increasing short-term
installment and commercial loans increases the overall risk of the loan
portfolio. Such risk relates primarily to collection and to the loans that often
are secured by rapidly depreciating assets. The Company's ratio of
non-performing assets to total assets was 1.79% at September 30, 2002 and 1.37%
at December 31, 2001.

                                       13

<PAGE>

The primary goal in the management of liabilities has been to extend the
maturities and improve the stability of deposit accounts. Management has
attempted to combine a policy for controlled growth with a strong, loyal
customer base to control interest expense.

The following schedule illustrates the interest-rate sensitivity of
interest-earning assets and interest-bearing liabilities at September 30, 2002.
Mortgages which have adjustable or renegotiable interest rates are shown as
subject to change every one to three years based upon the contracted-for
adjustment period. This schedule does not reflect the effects of possible
prepayments or enforcement of due-on-sale clauses.

<TABLE>
<CAPTION>
                                                         At September 30, 2002 Maturing or Repricing
                                             --------------------------------------------------------------------

                                               One Year       1 - 3         3 - 5        Over 5
                                               or Less        Years         Years         Years        Total
                                             --------------------------------------------------------------------
                                                                     (Dollars in 000's)
<S>                                           <C>          <C>            <C>          <C>            <C>
Interest-earning assets:
   Adjustable rate mortgages                  $  12,810    $   6,850      $   5,944    $     313      $  25,917
   Fixed rate mortgages                           6,147         2,889         3,250        16,389        28,675
   Commercial loans                              23,242         4,680         2,663         1,030        31,615
   Consumer loans                                15,564        14,199         5,926         1,689        37,378
   Tax-exempt loans and leases                       17           626           947         1,029         2,619
   Investments                                      681           481         1,160         1,119         3,441
   FHLB stock                                     1,025                                                   1,025
   Interest-bearing deposits                      1,949                                                   1,949
                                             --------------------------------------------------------------------
       Total interest-earning assets             61,435        29,725        19,890        21,569       132,619
                                             --------------------------------------------------------------------
Interest-bearing liabilities:
   Fixed maturity deposits                       35,577       11,217          7,070         2,610        56,474
   Other deposits                                31,671       12,866          5,371         1,531        51,439
   FHLB advances                                  1,500        1,500          5,500         5,000        13,500
                                             --------------------------------------------------------------------
Total interest-bearing liabilities               68,748       25,583         17,941         9,141       121,413
                                             --------------------------------------------------------------------
Excess (deficiency) of interest-earning          (7,313)       4,142          1,949        12,428        11,206
assets over interest-bearing liabilities
Cumulative excess (deficiency) of
interest-earning assets over
interest-bearing liabilities                     (7,313)      (3,171)        (1,222)       11,206
Cumulative ratio at September 30, 2002 as
a percent of total assets                        (4.90)%      (2.13)%        (.82)%        7.51%
</TABLE>

Liquidity and Capital Resources
-------------------------------

Liquidity refers to the ability of a financial institution to generate
sufficient cash to fund current loan demand, meet savings deposit withdrawals
and pay operating expenses. The primary sources of liquidity are cash,

                                       14

<PAGE>

interest-bearing deposits in other financial institutions, marketable
securities, loan repayments, increased deposits and total institutional
borrowing capacity.

Cash and interest-bearing deposits, when combined with investments, have
remained a relatively constant percent of total assets, while increasing in
dollar volume. Management's goal is to maintain approximately fifteen percent
(15%) to twenty percent (20%) of total assets in cash, interest-bearing deposits
and investments in order to satisfy the Company's need for liquidity and other
short-term obligations.

Management believes that it has adequate liquidity for the Company's short- and
long-term needs. Short-term liquidity needs resulting from normal
deposit/withdrawal functions are provided by the Company retaining a portion of
cash generated from operations in a Federal Home Loan Bank ("FHLB") daily
investment account. This account acts as a short-term liquidity source while
providing interest income to the Company. Long-term liquidity and other
liquidity needs are provided by the ability of the Company to borrow from the
FHLB. The balance of its FHLB advances was $13.5 million at September 30, 2002
and $15.5 million at December 31, 2001.

At September 30, 2002, the Bank had a tier 1 leverage ratio of approximately
7.36% and a total risk-based capital ratio of approximately 10.22%. The
regulatory tier 1 leverage and total risk-based capital requirements are 4.0%
and 8.0% respectively.

Impact of Inflation and Changing Prices
---------------------------------------

The financial statements and related data presented herein have been prepared in
accordance with generally accepted accounting principles. These principles
require the measurement of financial position and operating results in terms of
historical dollars, without considering changes in the relative purchasing power
of money over time due to inflation.

The primary assets and liabilities of the Company are monetary in nature.
Consequently, interest rates generally have a more significant impact on
performance than the effects of inflation. Interest rates, however, do not
necessarily move in the same direction or with the same magnitude as the price
of goods and services. In a period of rapidly rising interest rates, the
liquidity and the maturity structure of the Company's assets and liabilities are
critical to the maintenance of acceptable performance levels.

Other
-----

The Securities and Exchange Commission maintains a Web site that contains
reports, proxy and information statements, and other information regarding
registrants that file electronically with the Commission, including the Company.
The address is (http://www.sec.gov).


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

Although the Company files a Form 10-K in lieu of Form 10-KSB, the Company
qualifies as a small business issuer. Therefore, Item 7A is not required under
Section 229.305 of Regulation S-K.


Item 4.           Controls and Procedures
-------           -----------------------

(a) Evaluation of disclosure controls and procedures. The Company's chief
executive officer and chief financial officer, after evaluating the
effectiveness of the Company's disclosure controls and procedures (as defined in
Sections 13a-14(c) and 15d-14(c) of the Securities Exchange Act of 1934, as
amended), as of a date

                                       15

<PAGE>

(the "Evaluation Date") within 90 days before the filing date of this quarterly
report, has concluded that as of the Evaluation Date, the Company's disclosure
controls and procedures were adequate and are designed to ensure that material
information relating to the Company is timely gathered, analyzed and disclosed
to such officers within the Company, as appropriate, to allow timely decisions
regarding required disclosure in the Company's reports filed under the
Securities Exchange Act of 1934, as amended.

(b) Changes in internal controls. There have been no significant changes in the
Company's internal controls or in other factors that could significantly affect
the Company's internal controls subsequent to the Evaluation Date.


                           Part II - Other Information

Item 1.           Legal Proceedings.
-------           ------------------
                  None.

Item 2.           Changes in Securities.
-------           ----------------------
                  None

Item 3.           Defaults upon Senior Securities.
-------           --------------------------------
                  Not applicable.

Item 4.           Submission of Matters to a Vote by Security Holders.
-------           ----------------------------------------------------
                  None

Item 5.           Other Information.
-------           ------------------
                  None.

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

                  (a)  No reports were filed on Form 8-K during the quarter
                       ended September 30, 2002.



                                   SIGNATURES

Pursuant to the requirements 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.

                                  FIRST COMMUNITY BANCSHARES, INC.

    Date: November 14, 2002       By: /s/ Albert R. Jackson III
          -----------------           --------------------------------
                                      Albert R. Jackson III
                                      Chief Executive Officer and Director

    Date: November 14, 2002       By: /s/ Brian D. Heilers
          -----------------           --------------------------------
                                      Brian D. Heilers
                                      Vice President of Finance

                                       16

<PAGE>

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of First Community Bancshares, Inc. (the
"Company") on Form 10Q for the period ending June 30, 2002 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, Albert
R. Jackson, III, Chief Executive Officer and Chief Financial Officer of the
Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that:

         (1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

         (2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company as of and for the periods stated therein.


By: /s/ Albert R. Jackson, III
    ---------------------------------------------------
    Chief Executive Officer and Chief Financial Officer
    November 14, 2002



           CERTIFICATION OF PRINCIPAL EXECUTIVE AND FINANCIAL OFFICER

            Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Albert R. Jackson III, certify that:

1.   I have reviewed this quarterly report on Form 10-Q of First Community
     Bancshares, Inc.;

2.   Based on my knowledge, this quarterly report does not contain any untrue
     statement of a material fact or omit to state a material fact necessary to
     make the statements made, in light of the circumstances under which such
     statements were made, not misleading with respect to the period covered by
     this quarterly report; and

3.   Based on my knowledge, the financial statements, and other financial
     information included in this quarterly report, fairly present in all
     material respects the financial condition, results of operations and cash
     flows of the registrant as of, and for, the periods presented in this
     quarterly report.

                                       17

<PAGE>

4.   I am responsible for establishing and maintaining disclosure controls and
     procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
     registrant and have:

     (a)  designed such disclosure controls and procedures to ensure that
          material information relating to the registrant, including its
          consolidated subsidiaries, is made known to us by others within those
          entities, particularly during the period in which this quarterly
          report is being prepared;

     (b)  evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     (c)  presented in this quarterly report our conclusions about the
          effectiveness of the disclosure controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   I have disclosed, based on my most recent evaluation, to the registrant's
     auditors and the audit committee of the registrant's board of directors (or
     persons performing the equivalent functions):

     (a)  all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize and report financial data and have
          identified for the registrant's auditors any material weaknesses in
          internal controls; and

     (b)  any fraud, whether or not material, that involves management or other
          employees who have a significant role in the registrant's internal
          controls; and

6.   I have indicated in this quarterly report whether there were significant
     changes in internal controls or in other factors that could significantly
     affect internal controls subsequent to the date of our most recent
     evaluation, including any corrective actions with regard to significant
     deficiencies and material weaknesses.

By: /s/ Albert R. Jackson, III
    ---------------------------------------------------
    Chief Executive Officer and Chief Financial Officer
    November 14, 2002

                                       18