<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D. C. 20549


                                    FORM 10-Q

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

For the quarterly period ended June 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 number: 000-25221

                            CITIZENS HOLDING COMPANY
             (exact name of Registrant as specified in its charter)

         MISSISSIPPI                                   64-0666512
(State or other jurisdiction of        (I. R. S. Employer Identification Number)
incorporation or organization)

521 Main Street, Philadelphia, MS                       39350
(Address of principal executive offices)                (Zip Code)

Registrant's telephone number, including area code: 601-656-4692

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 of 15(d) of the Securities Exchange Act of 1934 during
the preceding 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. |X| Yes | | No

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of August 12, 2002.

             Title                                   Outstanding
Common Stock, $.20 par value                          4,963,028

<PAGE>

                            CITIZENS HOLDING COMPANY
                SECOND QUARTER 2002 INTERIM FINANCIAL STATEMENTS
                                TABLE OF CONTENTS

PART I.           FINANCIAL INFORMATION

         Item 1.  Consolidated Financial Statements

                  Consolidated Statements of Condition
                  June 30, 2002 and December 31, 2001

                  Consolidated Statements of Income
                  Three and six months ended June 30, 2002 and 2001

                  Consolidated Statements of Comprehensive Income
                  Three and six months ended June 30, 2002 and 2001

                  Consolidated Statements of Cash Flows
                  Six months ended June 30, 2002 and 2001

                  Notes to Consolidated Financial Statements

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

         Item 3.  Quantitative and Qualitative Disclosures About Market Risk

PART II. OTHER INFORMATION

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

         Item 6.  Exhibits and Reports on Form 8-K

         Signatures

<PAGE>


                    PART 1. CONSOLIDATED FINANCIAL STATEMENTS

                     CITIZENS HOLDING COMPANY AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CONDITION
<TABLE>
<CAPTION>

                                                                                     June 30,       December 31,
ASSETS                                                                                 2002            2001
                                                                                  ------------------------------
<S>                                                                                 <C>             <C>
Cash and due from banks                                                            $ 18,727,807    $ 12,713,482
Interest bearing deposits with other banks                                               24,048       5,421,241
Federal Funds Sold                                                                      825,000       6,100,000
Investment securities available for sale, at fair value                             176,032,872     122,567,180
Loans, net of allowance for loan losses of
   $4,231,583 in 2002 and $3,375,000 in 2001                                        292,685,445     260,903,091
Premises and equipment, net                                                           7,612,376       5,143,535
Other real estate owned, net                                                          1,103,611         340,657
Accrued interest receivable                                                           4,408,389       4,121,922
Cash value of life insurance                                                          2,951,472       2,809,410
Goodwill (net)                                                                        6,753,136       2,974,023
Other assets                                                                          3,427,098       4,118,333
                                                                                  ------------------------------
TOTAL ASSETS                                                                       $514,551,254    $427,212,874
                                                                                  ==============================
LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:
Deposits:
Noninterest-bearing demand                                                         $ 58,412,102    $ 50,535,929
Interest-bearing NOW and money market accounts                                      118,142,752      91,656,150
Savings deposits                                                                     32,384,655      22,481,585
Certificates of deposit                                                             223,783,153     194,635,343
                                                                                  ------------------------------
Total deposits                                                                      432,722,662     359,309,007

Accrued interest payable                                                              1,061,940       1,415,513
Federal Home Loan Bank advances                                                      19,173,148      14,628,788
Federal Funds Purchased                                                               5,000,000               0
Directors deferred compensation payable                                               1,130,726       1,079,191
Other liabilities                                                                     3,144,643       2,386,608
                                                                                  ------------------------------
Total liabilities                                                                   462,233,119     378,819,107

Minority interest in consolidated subsidiary                                          1,306,731       1,212,199

STOCKHOLDERS' EQUITY
Common stock; $.20 par value, 22,500,000 shares authorized, and 4,963,028 shares
  outstanding at June 30, 2002, and
   at December 31, 2001                                                               1,006,125       1,006,125
Less:  Treasury stock, at cost, 67,500 shares at
   June 30, 2002 and at December 31, 2001                                              -239,400        -239,400
Additional paid-in capital                                                            3,017,752       3,017,752
Retained earnings                                                                    45,256,243      43,240,017
Unrealized gain (loss) on securities available for sale, net of
deferred tax asset (liability) of $(1,300,651) in 2002 and ($89,295) in 2001          1,970,684         157,074
                                                                                  ------------------------------
Total stockholders' equity                                                           51,011,404      47,181,568
                                                                                  ------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                         $514,551,254    $427,212,874
                                                                                  ==============================
</TABLE>

See notes to consolidated financial statements.


<PAGE>

                     CITIZENS HOLDING COMPANY AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
                                                     For the Three Months            For the Six Months
                                                        Ended June 30,                  Ended June 30,
                                                     2002            2001            2002             2001
                                                -----------------------------------------------------------
<S>                                              <C>             <C>             <C>             <C>
INTEREST INCOME:
Loan income including fees                        $5,671,767     $5,698,589      $10,994,356    $11,444,318
Investment securities                              1,840,316      1,421,135        3,468,499      2,854,724
Other interest                                        61,197         64,327          140,894        144,145
                                                -----------------------------------------------------------
Total interest income                              7,573,280      7,184,051       14,603,749     14,443,187

INTEREST EXPENSE:
Deposits                                           2,163,111      3,103,452        4,434,418      6,169,542
Other borrowed funds                                 215,805        250,670          410,093        804,943
                                                -----------------------------------------------------------
Total interest expense                             2,378,916      3,354,122        4,844,511      6,974,485
                                                -----------------------------------------------------------
NET INTEREST INCOME                                5,194,364      3,829,929        9,759,238      7,468,702

PROVISION FOR LOAN LOSSES                            435,318        449,391          669,814        569,160
                                                -----------------------------------------------------------
NET INTEREST INCOME AFTER
 PROVISION FOR LOAN LOSSES                         4,759,046      3,380,538        9,089,424      6,899,542

OTHER INCOME:
Service charges on deposit accounts                  778,953        699,827        1,484,199      1,361,293
Other service charges and fees                       116,308        105,585          249,217        217,142
Other income                                         147,931        317,596          315,909        449,896
                                                -----------------------------------------------------------
Total other income                                 1,043,192      1,123,008        2,049,325      2,028,331

OTHER EXPENSES:
Salaries and employee benefits                     1,803,864      1,296,362        3,476,897      2,628,535
Occupancy expense                                    481,095        371,586          917,520        734,938
Other operating expense                            1,036,460        685,792        1,920,855      1,359,367
Earnings applicable to minority interest              43,541         51,095           91,922         98,737
                                                -----------------------------------------------------------
Total other expenses                               3,364,960      2,404,835        6,407,194      4,821,577
                                                -----------------------------------------------------------
INCOME BEFORE PROVISION FOR INCOME TAXES           2,437,278      2,098,711        4,731,555      4,106,296

PROVISION FOR INCOME TAXES                           775,285        612,815        1,524,204      1,246,707
                                                -----------------------------------------------------------
NET INCOME                                        $1,661,993     $1,485,896       $3,207,351     $2,859,589
                                                ===========================================================
NET INCOME PER SHARE
     -Basic                                            $0.33          $0.30            $0.65          $0.57
                                                ===========================================================
     -Diluted                                          $0.33          $0.30            $0.64          $0.57
                                                ===========================================================
</TABLE>

See notes to consolidated financial statements.

<PAGE>

                     CITIZENS HOLDING COMPANY AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

<TABLE>
<CAPTION>
                                                   For the Three Months            For the Six Months
                                                       Ended June 30,                  Ended June 30,
                                                   2002            2001            2002             2001
                                               -------------------------------------------------------------
<S>                                             <C>             <C>              <C>             <C>
Net income                                      $1,661,993      $1,485,896       $3,207,351      $2,859,589

Other comprehensive income, net of tax

   Unrealized holding gains (losses)             2,015,571         270,009        1,836,390         624,846

   Less reclassification adjustment for gains
     (losses) included in net income                22,780               0           22,780               0

     Total other comprehensive income            1,992,791         270,009        1,813,610         624,846
                                               -------------------------------------------------------------
Comprehensive income                            $3,654,784      $1,755,905       $5,020,961      $3,484,435
                                               =============================================================
</TABLE>

<PAGE>

                     CITIZENS HOLDING COMPANY AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                                     For the Six Months
                                                                         Ended June 30,
                                                                      2002             2001
                                                                 -----------------------------

<S>                                                                <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:

Net Cash Provided by Operating Activities                          $5,154,417      $4,104,324

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from maturities of securities available for sale          32,917,639      24,512,517
Proceeds from sale of investment securities                        25,744,965               0
Purchases of investment securities                               -112,128,296     -31,814,450
Purchases of bank premises and equipment                           -2,789,041        -304,174
Decrease in interest bearing deposits with other  banks             5,397,193        -368,896
Net (increase) decrease in federal funds sold                       5,275,000      -7,500,000
Premium paid on Bank purchase                                      -3,955,920               0
Net (increase) decrease in loans                                  -31,782,354         990,454

Net Cash Used by Investing Activities                             -81,320,814     -14,484,549


CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in deposits                                73,413,655      31,603,342
Net increase (decrease) in ABE loans                                  413,834        -144,928
Increase (decrease) in TT&L Note Option                                     0        -700,000
Increase (decrease) in FHLB advances                                4,544,360     -27,000,000
Increase in federal funds purchased                                 5,000,000       7,500,000
Payment of dividends                                               -1,191,127        -909,906

Net Cash Provided by Financing Activities                          82,180,722      10,348,508

Net Increase (Decrease) in Cash and Due from Banks                  6,014,325         -31,717

Cash and Due From Banks, beginning of year                         12,713,482      10,415,155

Cash and Due from Banks, end of period                             18,727,807      10,383,438

</TABLE>

<PAGE>

                     CITIZENS HOLDING COMPANY AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     For the six months ended June 30, 2002

1.   These interim consolidated financial statements have been prepared in
     accordance with accounting principles generally accepted in the United
     States of America. However, these financial statements do not include all
     of the information and footnotes required by generally accepted accounting
     principles for complete financial statements. The interim consolidated
     financial statements are unaudited and reflect all adjustments and
     reclassifications which, in the opinion of management, are necessary for a
     fair presentation of the results of operations and financial condition of
     the interim period. All adjustments and reclassifications are of a normal
     and recurring nature. Results for the periods ending June 30, 2002 are not
     necessarily indicative of the results that may be expected for any other
     interim periods or for the year as a whole.

     The interim consolidated financial statements of Citizens Holding Company
     include the accounts of its 97.44% owned subsidiary, The Citizens Bank of
     Philadelphia (collectively referred to as "the Corporation"). All
     significant intercompany transactions have been eliminated in
     consolidation.

2.   Summary of Significant Accounting Policies. See note 1 of the Notes to
     Consolidated Financial Statements of the Citizens Holding Company that were
     included in the Form 10-K Annual Report filed March 28, 2002.

     Investment Securities - The Corporation classifies all of its securities as
     available-for-sale and carries them at fair value with unrealized gains or
     losses reported as a separate component of capital, net of any applicable
     income taxes. Realized gains or losses on the sale of securities
     available-for-sale, if any, are determined on an identification basis. The
     Corporation does not have any securities classified as Held for Trading or
     Held to Maturity.

3.   In May 2002, the Corporation acquired CB&T Capital Corporation, a one-bank
     holding company, whose wholly-owned subsidiary was Citizens Bank & Trust
     Company in Louisville, MS. The acquisition was undertaken by the
     Corporation in order to gain entry into a geographic section of the state
     of Mississippi that is contiguous to the Corporation's current markets and
     in which the Corporation had very little market presence. The purchase
     price of the net assets totaled approximately $12.3 million cash and was
     based on a multiple approximately 1.505 times the book value, subject to
     certain adjustments, of the acquired company. The Corporation based its
     purchase price on several factors, including comparable transactions and
     management's estimate of the value of entry into a strategically targeted
     geographic area.

<PAGE>

     The follow is a summary of the assets and liabilities acquired:

                  Cash                                         $ 2,880

                  Investments                                   50,620

                  Loans                                         15,019

                  Bank Premises and others assets                3,025

                  Deposits                                     (57,939)

                  Other liabilities                             (5,127)
                                                               -------
                  Net assets acquired                            8,478

                  Goodwill and other intangible assets         $ 3,806
                                                               -------
                  Purchase Price                               $12,284

     The Corporation has not yet completed its evaluation of all of the assets
     and liabilities acquired, including the allocation of purchase price to
     identifiable intangible assets. The impact on depreciation and amortization
     expense for the quarter ended June 30, 2002 of any subsequent changes in
     the allocation of the purchase price is not expected to be material.

4.   In the ordinary course of business, the Corporation enters into commitments
     to extend credit to its customers. The unused portion of these commitments
     is not reflected in the accompanying financial statements. As of June 30,
     2002, the Corporation had entered into commitments with certain customers
     that had an unused balance of $17,221,798 compared to $12,155,738 unused at
     December 31, 2001. There were $499,600 of letters of credit outstanding at
     June 30, 2002 and $444,500 at December 31, 2001.

5.   Net income per share - Basic, has been computed based on the weighted
     average number of shares outstanding during each period. Net income per
     share - Diluted, has been computed based on the weighted average number of
     shares outstanding during each period plus the dilutive effect of
     outstanding granted options. Basic weighted average shares have been
     adjusted to reflect the five-for-one stock split on the common stock
     effective January 1, 1999 and the three-for-two stock split that was
     effective January 2, 2002. Earnings per share were computed as follows:

<PAGE>

<TABLE>
<CAPTION>

                                             For the Three Months           For the Six Months
                                                Ended June 30,                 Ended June 30,
                                             2002          2001            2002           2001
                                        ----------------------------------------------------------
<S>                                       <C>            <C>             <C>            <C>
Basic weighted average
    shares outstanding                    4,963,028      4,963,028       4,963,028      4,963,028
Dilutive effect of granted options           32,297         12,438          32,268         11,331
                                        ----------------------------------------------------------
Diluted weighted average
    shares outstanding                    4,995,325      4,975,466       4,995,296      4,974,359

Net income                               $1,661,993     $1,485,896      $3,207,351     $2,859,589
Net income per share-basic                    $0.33          $0.30           $0.65          $0.57
Net income per share-diluted                  $0.33          $0.30           $0.64          $0.57
</TABLE>

6.   In July 2001, the Corporation completed the acquisition of two bank
     branches located in Forest and Decatur, Mississippi from Union Planters
     Bank. The Corporation acquired approximately $30.3 million in deposits,
     $11.7 million in loans, and $15.4 million in cash and short-term
     investments. The $2.5 million premium paid by the Corporation was allocated
     primarily to a core deposit intangible asset.

     In May 2002, the Corporation acquired Citizens Bank & Trust Company and
     CB&T Capital Corporation of Louisville in a cash purchase of all of the
     outstanding stock of CB&T Capital Corporation for $12.4 million. The
     Corporation acquired $71.1 million in assets, of which $15.0 was loans,
     $50.6 million was in investment securities and $1.8 million in bank
     building and equipment. Also acquired in this transaction were $57.9
     million of deposits.

     Amortization expense related to the core deposit intangible assets for the
     period ended June 30, 2002 was $176,406.

7.   The Corporation is a party to lawsuits and other claims that arise in the
     ordinary course of business, which are being vigorously contested. In the
     regular course of business, Management evaluates estimated losses or costs
     related to litigation, and the provision is made for anticipated losses
     whenever Management believes that such losses are probable and can be
     reasonably estimated. At the present time, Management believes, based on
     the advice of legal counsel, that the final resolution of pending legal
     proceedings will not have a material impact on the Corporation's
     consolidated financial position or results of operations.

8.   In June 2001, the FASB issued Statement of Financial Accounting Standards
     No. 141 "Business Combinations" and Statement No. 142, "Goodwill and other
     Intangible Assets". FAS No. 141 requires that all business combinations
     entered into after June 30, 2001 be accounted for under the purchase
     method. FAS No. 142 requires that all intangible assets, including
     goodwill, that result from business combinations be periodically (at least
     annually) evaluated for impairment, with any resulting impairment loss
     being charged against earnings. Also, under FAS No. 142, goodwill resulting
     from any business combination

<PAGE>

     accounted for according to FAS No. 141 is not amortized, and the
     amortization of goodwill related to business combinations entered into
     prior to June 30, 2001 is discontinued effective, January 1, 2002. The
     Company adopted the provisions of FAS No. 141 on July 1, 2001, and the
     provisions of FAS No. 142 related to discontinuation of goodwill
     amortization effective January 1, 2002

     In June 2001, the FASB issued Standard No. 143 related to accounting for
     asset retirement obligations. The new standard establishes accounting
     standards for recognition and measurement of a liability for an asset
     retirement obligation and associated asset retirement cost. The standard is
     effective for fiscal years beginning after June 15, 2002. Adoption of this
     statement will not have a material effect on the Company's financial
     statements.

     In August 2001, the FASB issued Standard No. 144 related to accounting for
     the impairment or disposal of long-lived assets. The standard establishes
     specific accounting standards related to long-lived assets to be held and
     used, sold, or abandoned and those to be disposed of by exchange for
     similar assets or distributed to owners. The standard is effective for
     fiscal years beginning after December 31, 2001. Adoption of this standard
     by the company is not expected to have a material effect on the Company's
     financial statements.

<PAGE>

                     CITIZENS HOLDING COMPANY AND SUBSIDIARY
            ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

Management's discussion and analysis is written to provide greater insight into
the results of operations and the financial condition of Citizens Holding
Company and its 97.44% owned subsidiary, The Citizens Bank of Philadelphia
(collectively, the "Corporation").

LIQUIDITY

The Corporation has an asset and liability management program that assists
management in maintaining net interest margins during times of both rising and
falling interest rates and in maintaining sufficient liquidity. Liquidity of the
Corporation at June 30, 2002 was 48.1%, at December 31, 2001 was 50.51% and at
June 30, 2001 was 49.2%. Liquidity is the ratio of net deposits and short term
liabilities divided by net cash, short-term investments and marketable assets.
Management believes it maintains adequate liquidity for the Corporation's
current needs.

When the Corporation has more funds than it needs for its reserve requirements
or short-term liquidity needs, the Corporation increases its security
investments or sells federal funds. It is management's policy to maintain an
adequate portion of its portfolio of assets and liabilities on a short-term
basis to insure rate flexibility and to meet loan funding and liquidity needs.
The Corporation has secured and unsecured federal funds lines with correspondent
banks in the amount of $38,500,000. In addition, the Corporation has the ability
to draw on its line of credit with the Federal Home Loan Bank in excess of
$54,248,250 at June 30, 2002. At June 30, 2002, the Corporation had unused and
available $38,500,000 of its federal funds line of credit and $35,075,102 of its
line of credit with the Federal Home Loan Bank.

CAPITAL RESOURCES

The Corporation's equity capital was $51,011,404 at June 30, 2002. The main
source of capital for the Corporation has been the retention of net income.

On January 1, 1999, the Corporation issued a five-for-one (5:1) split to the
shareholders of the Corporation. This split increased the number of shares
outstanding to 3,308,750 from 661,750. The number of shares authorized increased
from 750,000 to 3,750,000 after the split. Additionally, the shareholders
approved an increase in authorized shares to 15,000,000 at the annual meeting
held April 13, 1999.

On January 2, 2002, the Corporation issued a three-for-two (3:2) split to the
shareholders of the Corporation. This split increased the number of outstanding
shares to 4,963,028

<PAGE>

and increased the authorized shares from 15,000,000 to 22,500,000. Cash
dividends in the amount of $1,191,127 or $0.24 per share were paid year to date
June 30, 2002.

Quantitative measures established by regulation to ensure capital adequacy
require the Corporation to maintain minimum amounts and ratios of Total and Tier
1 capital (primarily common stock and retained earnings, less goodwill) to risk
weighted assets, and of Tier 1 capital to average assets. Management believes
that as of June 30, 2002, the Corporation meets all capital adequacy
requirements to which it is subject.

<TABLE>
<CAPTION>

                                                                                                To Be Well
                                                                                            Capitalized Under
                                                                    For Capital             prompt Corrective
                                            Actual               Adequacy Purposes          Actions Provisions
                                 ---------------------------------------------------------------------------------
                                     Amount        Ratio        Amount        Ratio       Amount        Ratio
                                 ---------------------------------------------------------------------------------
<S>                               <C>              <C>       <C>              <C>       <C>             <C>
As of June 30, 2002
Total Capital                     $47,274,799      16.09%    $23,511,015      *8.00%    $29,388,768     *10.00%
  (to Risk-Weighted Assets)

Tier 1 Capital                     43,594,314      14.83%     11,755,507      *4.00%     17,633,261      *6.00%
  (to Risk-Weighted Assets)

Tier 1 Capital                     43,594,314       9.19%     18,973,515      *4.00%     23,716,893      *5.00%
  ( to Average Assets)
</TABLE>
------------
* Greater than

RESULTS OF OPERATIONS

The following table sets forth for the periods indicated, certain items in the
consolidated statements of income of the Corporation and the related changes
between those periods:

<TABLE>
<CAPTION>
                                         For the Three Months                For the Six Months
                                             Ended June 30,                     Ended June 30,
                                         2002             2001              2002             2001
                                    -----------------------------------------------------------------
<S>                                   <C>              <C>              <C>              <C>
Interest Income, including fees       $7,573,280       $7,184,051       $14,603,749      $14,443,187
Interest Expense                       2,378,916        3,354,122         4,844,511        6,974,485
                                    -----------------------------------------------------------------
Net Interest Income                    5,194,364        3,829,929         9,759,238        7,468,702
Provision for Loan Losses                435,318          449,391           669,814          569,160

Net Interest Income after
Provision for Loan Losses              4,759,046        3,380,538         9,089,424        6,899,542
Other Income                           1,043,192        1,123,008         2,049,325        2,028,331
Other Expense                          3,364,960        2,404,835         6,407,194        4,821,577
                                    -----------------------------------------------------------------
</TABLE>

<PAGE>

<TABLE>
<S>                                     <C>             <C>             <C>             <C>
Income before Provision For
Income Taxes                            2,437,278       2,098,711        4,731,555       4,106,296
Provision for Income Taxes                775,285         612,815        1,524,204       1,246,707
                                      ------------------------------------------------------------
Net Income                             $1,661,993      $1,485,896       $3,207,351      $2,859,589
                                      ============================================================
Net Income Per Share - Basic                $0.33           $0.30            $0.65           $0.57
                                      ============================================================
Net Income Per Share-Diluted                $0.33           $0.30            $0.64           $0.57
                                      ============================================================
</TABLE>

Net Income Per Share - Basic is calculated using weighted average number of
shares outstanding for the period. Net Income Per Share - Diluted is calculated
using the weighted average number of shares outstanding for the period, plus the
net dilutive effect of granted stock options determined using the treasury stock
method.

Annualized return on average equity (ROE) was 13.63% and 13.21% and for the
three and six months ended June 30, 2002, and 12.94% and 12.66% for the three
and six months ended June 30, 2001. The increase in ROE for this period was the
result of earnings growth that was greater than the rate of growth for equity.

The book value per share increased to $10.28 at June 30, 2002 compared to $9.51
at December 31, 2001. This increase is due to earnings exceeding dividends paid
during this period. Average assets for the six months ended June 30, 2002, were
$461,229,441 compared to $403,881,314 for the year ended December 31, 2001, and
average equity increased to $48,550,951 for the six months ended June 30, 2002,
from $47,663,502 for the year ended December 31, 2001. The increase in average
assets is due to the acquisition of the Union Planters branches in July 2001 and
the acquisition of Citizens Bank & Trust Company in May 2002.

NET INTEREST INCOME/NET INTEREST MARGIN

One component of the Corporation's earnings is net interest income, which is the
difference between the interest and fees earned on loans and investments and the
interest paid for deposits and borrowed funds. The net interest margin is net
interest income expressed as a percentage of average earning assets.

The annualized net interest margin was 4.79% and 4.71% for the three and six
months ended June 30, 2002, compared to an annualized net interest margin of
4.47 % and 4.37% for the three and six months ended June 30, 2001. Earnings
assets averaged $425,058,413 for the six months ended June 30, 2002. This
represented an increase of $71,415,480, or 20.2%, over average earning assets of
$353,642,933 for the six months ended June 30, 2001.

<PAGE>

Net interest income was $5,194,364 and $9,759,238 for the three and six month
periods in 2002, an increase of $1,364,435 and $2,290,536 respectively over the
same periods in 2001. An increase in loan volume and investments in this period
contributed to this increase. A lower cost of deposits and other borrowed funds
during 2002 over the same period in 2001 also contributed to the increase in Net
Interest Income. Income from investment securities increased in the six month
period in 2002 as a result of both an increase in the principal balance of
investment securities and a shift in the mix of investments from lower yielding
U. S. Treasury Securities into higher yield mortgage backed products.

The added liquidity that resulted from the acquisition of the two Union Planters
Bank branches in the third quarter of 2001, together with a general increase in
deposits, permitted the Corporation to pay off a large portion of it borrowings
from the Federal Home Loan Bank, significantly decreasing interest expense on
other borrowings.

Other interest income decreased in the three and six month periods due to a
decrease in the interest rates on Federal Funds Sold.

The following table shows the interest and fees and corresponding yields for
loans only.

<TABLE>
<CAPTION>

                                           For the Three Months                For the Six Months
                                               Ended June 30,                    Ended June 30,
                                          2002              2001             2002              2001
                                     ------------------------------------------------------------------
<S>                                    <C>               <C>             <C>               <C>
Interest and Fees                      $5,671,767        $5,698,589      $10,994,356       $11,444,318
Average Loans, Net of Unearned        287,872,919       249,637,526      276,737,899       250,355,556
Annualized Yield                            7.88%             9.13%            7.95%             9.21%
</TABLE>

The decreases in rates in the three and six month periods reflect the decrease
in all loan rates for both new and refinanced loans in the corresponding
periods.

CREDIT LOSS EXPERIENCE

As a natural corollary to the Corporation's lending activities, some loan losses
are to be expected. The risk of loss varies with the type of loan being made and
the creditworthiness of the borrower over the term of the loan. The degree of
perceived risk is taken into account in establishing the structure of, and
interest rates and security for, specific loans and for various types of loans.
The Corporation attempts to minimize its credit risk exposure by use of thorough
loan application and approval procedures.

The Corporation maintains a program of systematic review of its existing loans.
Loans are graded for their overall quality. Those loans which the Corporation's
management determines require further monitoring and supervision are segregated
and reviewed on a periodic basis. Significant problem loans are reviewed on a
monthly basis by the Corporation's Board of Directors.

<PAGE>

The Corporation charges off that portion of any loan which management considers
to represent a loss. A loan is generally considered by management to represent a
loss in whole or in part when an exposure beyond the collateral value is
apparent, servicing of the unsecured portion has been discontinued or collection
is not anticipated based on the borrower's financial condition and general
economic conditions in the borrower's industry. The principal amount of any loan
which is declared a loss is charged against the Corporation's allowance for loan
losses.

The Corporation's allowance for loan losses is designed to provide for loan
losses which can be reasonably anticipated. The allowance for loan losses is
established through charges to operating expenses in the form of provisions for
loan losses. Actual loan losses or recoveries are charged or credited to the
allowance for loan losses. The amount of the allowance is determined by
management of the Corporation. Among the factors considered in determining the
allowance for loan losses are the current financial condition of the
Corporation's borrowers and the value of security, if any, for their loans.
Estimates of future economic conditions and their impact on various industries
and individual borrowers are also taken into consideration, as are the
Corporation's historical loan loss experience and reports of banking regulatory
authorities. Because these estimates, factors and evaluations are primarily
judgmental, no assurance can be given as to whether or not the Corporation will
sustain loan losses in excess or below its allowance or that subsequent
evaluation of the loan portfolio may not require material increases or decreases
in such allowance.

The following table summarizes the Corporation's allowance for loan losses for
the dates indicated:

<TABLE>
<CAPTION>

                                                                        Amount of        Percent of
                                      June 30,       December 31,        Increase         Increase
                                        2002             2001           (Decrease)       (Decrease)
                                  ------------------------------------------------------------------
<S>                                <C>              <C>                <C>                   <C>
BALANCES:
Gross Loans                        $299,450,724     $266,932,966       $32,517,758           12.18%
Allowance for Loan Losses             4,231,583        3,375,000           856,583           25.38%
Nonaccrual Loans                        362,948          418,813           -55,865          -13.34%
Ratios:
Allowance for loan losses to
  gross loans                              1.41%            1.28%
Net loans charged off to
  allowance for loan losses               15.83%           31.80%
</TABLE>

The provision for loan losses for the three months ended June 30, 2002 was
$435,318, a decrease of $14,073 over the $449,391 for the same period in 2001.
The provision for the six months ended June 30, 2002 was $669,814, an increase
of $100,654 or 17.7% over the $569,160 for the six months ended June 30, 2001.
The increase in the provision was

<PAGE>

made to bring the allowance back to the desired level after the net charge-offs
for these periods. The allowance for loan losses was increased $856,583 as a
result of the acquisition of Citizens Bank & Trust Company. This addition to the
allowance for loan losses was made to maintain an adequate loan loss allowance
for the loans outstanding at June 30, 2002. This is in addition to the $669,814
that was added to the allowance as a part of normal operations.

For the three months ended June 30, 2002, net loan losses charged to allowance
for loan losses totaled $435,318, a decrease of $14,073 over the same period in
2001. For the six months ended June 30, 2002, net loan losses charged to the
allowance for loan losses totaled $669,814, an increase of $100,654 over the
same period in 2001. Increased net losses in consumer loans, commercial and
industrial loans and 1-4 family housing accounted for the majority of the
increased net loss in the three and six month period.

Management of the Corporation reviews with the Board of Directors the adequacy
of the allowance for possible loan losses on a quarterly basis. The loan loss
provision is adjusted when specific items reflect a need for such an adjustment.
Management believes that there were no material loan losses during the last six
months that have not been charged off. Management also believes that the
Corporation's allowance will be adequate to absorb probable losses inherent in
the Corporation's loan portfolio.

OTHER INCOME

Other operating income includes service charges on deposit accounts, wire
transfer fees, safe deposit box rentals and other revenue not derived from
interest on earning assets.

Other operating income for the three months ended June 30, 2002 decreased
$79,816 or 7.1% over the same period in 2001 and for the six months ended June
30, 2002, increased $20,994, or 1.0% over the same period in 2001. The increase
in the six-month period was the result of increased overdraft, returned check
income and other service charges and mortgage loan origination income. The
decrease in the three month comparison is due to the receipt of insurance
proceeds in the second quarter of 2001 on the death of a retired director
pursuant to a deferred compensation agreement.

OTHER EXPENSE

Other expenses include salaries and employee benefits, occupancy and equipment,
and other operating expenses. Other expenses for the three and six months ended
June 30, 2002 were $3,364,960 and $6,407,194 compared to the $2,404,835 and
$4,821,577 for the three and six months ended June 30, 2001 for an increase of
$960,125 and $1,585,617 respectively. Salaries and benefits increased to
$1,803,864 and $3,476,897 for the three and six months in 2002 from $1,296,362
and $2,628,535 for the same periods in 2001, an

<PAGE>

increase of $507,502 or 39.1% and $848,362 or 32.3% respectively. Both the
increase in Other Expenses as a whole, and salaries and benefits specifically,
are the result of the growth of the Corporation, both from the acquisitions of
the Union Planters branches in July 2001 and Citizens Bank & Trust Company in
May 2002 and internal growth of the deposit base. Although expenses increased,
the Corporation's efficiency ratio for the three and six-month periods ended
June 30, 2002 was 52.86% and 53.18% compared to 46.61% and 48.73% for the same
periods in 2001.

<PAGE>

BALANCE SHEET ANALYSIS

<TABLE>
<CAPTION>

                                                                       Amount of        Percent of
                                     June 30,       December 31,        Increase         Increase
                                       2002             2001           (Decrease)       (Decrease)
                                 -------------------------------------------------------------------
<S>                                 <C>              <C>                  <C>                 <C>
Cash and Cash Equivalents           $18,751,855      $18,134,723          $617,132            3.40%
Investment Securities               176,032,872      122,567,180        53,465,692           43.62%
Loans, net                          292,685,445      260,903,091        31,782,354           12.18%
Total Assets                        514,551,254      427,212,874        87,338,380           20.44%

Total Deposits                      432,722,662      359,309,007        73,413,655           20.43%

Total Stockholders' Equity           51,011,404       47,181,568         3,829,836            8.12%
</TABLE>

CASH AND CASH EQUIVALENTS

Cash and cash equivalents are made up of cash, balances at correspondent banks
and federal funds sold. The increase in cash and cash equivalents at June 30,
2002 of $617,132 was the result of the addition of the cash required to operate
the three new Citizens Bank & Trust Company branches acquired in May 2002.

INVESTMENT SECURITIES

The investment securities are made up of U. S. Treasury Notes, U. S. Agency
debentures, mortgage-backed securities, obligations of states, counties and
municipal governments and Federal Home Loan Bank Stock. Investments increased
$53,465,692 or 43.6% as a result of the acquisition of $50.6 million in
investment securities related to the purchase of Citizens Bank & Trust Company
in May 2002 and the need to invest excess liquidity.

LOANS

Loan demand in the Corporation's service area began to strengthen as net loans
increased by $31,782,354 or 12.2% during the six month period ended June 30,
2002. Of this increase, $15.0 million was acquired with the purchase of Citizens
Bank & Trust Company in May 2002. Residential housing loans continue to be in
demand along with commercial and industrial loans. No special loan programs were
initiated during this period.

<PAGE>

DEPOSITS

The following shows the balance and percentage change in the various deposits:

<TABLE>
<CAPTION>
                                                                          Amount of        Percent of
                                        June 30,       December 31,        Increase         Increase
                                          2002             2001           (Decrease)       (Decrease)
                                   -------------------------------------------------------------------
<S>                                   <C>              <C>                <C>                  <C>
Noninteresting-bearing Deposits       $58,412,102      $50,535,929        $7,876,173           15.59%
Interest-bearing Deposits             118,142,752       91,656,150        26,486,602           28.90%
Savings                                32,384,655       22,481,585         9,903,070           44.05%
Certificates of Deposit               223,783,153      194,635,343        29,147,810           14.98%
                                   -------------------------------------------------------------------
Total Deposits                       $432,722,662     $359,309,007       $73,413,655           20.43%
                                   ===================================================================
</TABLE>

The increase is the result of normal deposit growth and the acquisition of $57.9
million in deposits from Citizens Bank & Trust Company. Normal deposit growth
was influenced by the decline in the stock market and the need for more
conservative investments by our depositors. The Corporation does not have any
brokered deposits. There were no special deposit programs or incentives in place
during this period.

FORWARD LOOKING STATEMENTS

In addition to historical information, this report contains statements which
constitute forward-looking statements and information within the meaning of the
Private Securities Litigation Reform Act of 1995 which are based on management's
beliefs, plans, expectations, assumptions and on information currently available
to management. The words "may," "should," "expect," "anticipate," "intend,"
"plan," "continue," "believe," "seek," "estimate," and similar expressions used
in this report that do not relate to historical facts are intended to identify
forward-looking statements. These statements appear in a number of places in
this report, including, but not limited to, statements found in Item 1 "Notes to
Consolidated Financial Statements" and in Item 2 "Management's Discussion and
Analysis of Financial Condition and Results of Operations." The Corporation
notes that a variety of factors could cause the actual results or experience to
differ materially from the anticipated results or other expectations described
or implied by such forward-looking statements. The risks and uncertainties that
may affect the operation, performance, development and results of the
Corporation's business include, but are not limited to, the following: (a) the
risk of adverse changes in business conditions in the banking industry generally
and in the specific markets in which the Corporation operate; (b) changes in the
legislative and regulatory environment that negatively impact the Corporation
through increased operating expenses; (c) increased competition from other
financial institutions; (d) the impact of technological advances; (e)
expectations about the movement of interest rates, including actions that may be
taken by the federal

<PAGE>

Reserve Board in response to changing economic conditions; (f) changes in asset
quality and loan demand; (g) expectations about overall economic strength and
the performance of the economics in the Corporation's market area and (h) other
risks detailed from time to time in the Corporation's filings with the
Securities and Exchange Commission. The Corporation does not undertake any
obligation to update or revise any forward-looking statements subsequent to the
date on which they are made.

<PAGE>

                            CITIZENS HOLDING COMPANY
                ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES
                                ABOUT MARKET RISK

Overview

The definition of market risk is the possibility of loss that could result from
adverse changes in market prices and rates. The Corporation has taken steps to
assess the amount of risk that is associated with its asset and liability
structure. The Corporation measures the potential risk on a regular basis and
makes changes to its strategies to manage these risks. The Corporation does not
participate in some of the financial instruments that are inherently subject to
substantial market risk.

Market/Interest Rate Risk Management

The primary purpose in managing interest rate risk is to effectively invest
capital and preserve the value created by the core banking business. The
Corporation utilizes an investment portfolio to manage the interest rate risk
naturally created through its business activities. The quarterly interest rate
risk report is used to evaluate exposure to interest rate risk, project earnings
and manage the composition of the balance sheet and its growth.

Static gap analysis is also used in measuring interest rate risk. An analysis of
the Corporation's repricing opportunities indicates a negative gap position over
the next three- and twelve -month periods which indicates that the Corporation
would benefit somewhat from a decrease in market interest rates. While interest
rates remained stable during the quarter ended June 30, 2002, during 2001 the
Corporation experienced an increased number of called investment securities
related to the decrease in interest rates that occurred throughout 2001. These
called securities generally were re-invested at lower yields. The Corporation's
interest bearing deposit liabilities have been substantially repriced to reflect
the current interest rate environment.

Other than the recent interest rate decreases, there have been no material
change in the Corporation's market risk since the end of the last fiscal year
end of December 31, 2001.

<PAGE>

                          PART II. - OTHER INFORMATION

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

The Corporation held its Annual Meeting of Shareholders on April 23, 2002 at
3:30 p.m. at the Main Office of The Citizens Bank of Philadelphia, 521 Main
Street, Philadelphia, Mississippi. At this meeting there were 4,080,322 shares
or 82.2% of the Corporation's issued and outstanding shares of common stock
represented either in person or by proxy at the Annual Meeting.

The shareholders considered and voted upon a proposal to set the number of
directors to serve on the Board of Directors at twelve members. The shareholders
of the Corporation adopted this proposal by a vote of 4,077,435 for the
proposal, 2,887 shares against the proposal with no abstentions or broker
non-votes.

After the Annual Meeting, Don L. Fulton, Don L. Kilgore, Herbert A. King, and
David P. Webb continued as Class I Directors of the Corporation until their term
of office expires in 2003.

After the Annual Meeting, M. G. Bond, Karl Brantley, David A. King and Greg L.
McKee continued as Class II Directors of the Corporation until their term
expires in 2004.

An election was held to elect four Class III directors to a three-year term
expiring in 2005. The votes for each nominee were:

                                 Shares Voted For       Shares Withheld

         George R. Mars             4,046,850                33,472
         William M. Mars            4,051,995                28,327
         W. W. Dungan               4,066,485                13,837
         Steve Webb                 4,066,485                13,837

The shareholders considered and voted upon a proposal to ratify the Horne CPA
Group as the Corporation's independent auditors for the fiscal year ending
December 31, 2002. The shareholders of the Corporation adopted this proposal by
a vote of 4,064,388 affirmative votes to 15,933 votes against with 1 abstention
and no broker non-votes.

<PAGE>

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a)      Exhibits

         2        Agreement and Plan of Share Exchange
         3(i)     Amended Articles of Incorporation of the Corporation        *
         3(ii)    Amended and Restated Bylaws of the Corporation              *
         4        Rights Agreement between Citizens Holding Company           *
                  and The Citizens Bank of Philadelphia, Mississippi
         10       Directors' Deferred Compensation Plan - Form of Agreement   *
         10(a)    Citizens Holding Company 1999 Directors' Stock              *
                  Compensation Plan
         10(b)    Citizens Holding Company 1999 Employees' Long-Term          *
                  Incentive Plan

*    Filed as an exhibit to the Form 10 Registration Statement of the
     Corporation (File No. 000-25221) filed on December 30, 1998 and
     incorporated herein by reference, and also filed as an exhibit to Amendment
     No. 1 to Form 10 Registration Statement of the Corporation (File No.
     000-25221) filed on June 21, 1999 and incorporated herein by reference.

(b)      Reports on Form 8-K.

         The following reports on form 8-K were filed by the Corporation during
         the last quarter of the period covered by this Form 10-Q:

                  On April 23, 2002, the Corporation filed on Form 8-K under
         Item 7(a) and Item 9 a press release announcing the financial results
         of the Corporation for the quarter ended March 31, 2002.

<PAGE>

                                   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.

                            CITIZENS HOLDING COMPANY



 BY:        /s/ Steve Webb                    BY:    /s/ Robert T. Smith
    ---------------------------------            ----------------------------
           Steve Webb                                Robert T. Smith
           Chairman, President and                   Treasurer (Chief Financial
           Chief Executive Officer                   and Accounting Officer)

  DATE: August 12, 2002                        DATE: August 12, 2002