EXHIBIT 13
<PAGE>



                               CCF HOLDING COMPANY
                                  ANNUAL REPORT



                                TABLE OF CONTENTS




         Letter to Stockholders                                            1


         Corporate Profile and Stock Market Information                    2


         Selected Financial and Other Data                                 3


         Management's Discussion and Analysis                              6


         Report of Independent Certified Public Accountants               13


         Consolidated Financial Statements                                14


         Notes to Consolidated Financial Statements                       19


         Office Locations and Other Corporate Information                 33




<PAGE>










         Dear Fellow Shareholder:

         It is with a great deal of pride and  pleasure  that we disclose to you
         the results of  operations of CCF Holding  Company and its  subsidiary,
         Heritage  Bank,  for the fiscal year ended  December 31, 1999.  For the
         first time in the  Company's  history  (and the  Bank's) we are able to
         report net earnings in excess of $1,000,000.

         As you read the body of this  document  please  note that while we have
         more to  accomplish  to be  considered a "high  performing"  bank,  the
         trends are very positive.

         Total  assets  have  increased  by 16%  to  $196,782,000.  In  the  all
         important category of basic earnings per share,  earnings improved from
         $.67 per share in 1998 to $1.09 per share in 1999.  Deposits in the new
         markets we entered two years ago are now 43% of the Bank's total, while
         loans in those  areas  are now 37% of our  overall  portfolio,  a clear
         indication to us that expansion has had its beneficial effects.

         We pledge to stay focused.  We appreciate your confidence in us and are
         eagerly anticipating the new millennium.

         Very truly yours,


         /s/D.B. Turner
         --------------
         D. B. Turner
         President & CEO









                                       1
<PAGE>
                               CCF HOLDING COMPANY

         Corporate Profile and Related Information

         CCF Holding Company (the "Company") is a bank holding company chartered
         by the State of Georgia.  Heritage  Bank (the  "Bank") is a  commercial
         bank that is the  wholly  owned  subsidiary  of the  Company.  Prior to
         September 1, 1998,  the Company was a savings and loan holding  company
         and the Bank was a federally  chartered  savings bank.  The Company was
         organized in 1995 in connection  with the  conversion  from a mutual to
         stock form of organization  (the  "Conversion") of a predecessor of the
         Bank in  July  1995.  The  Bank,  through  it  predecessors,  commenced
         business in 1955.

         The Bank  operates  five  offices  within its  primary  market  area in
         Clayton,  Fayette  and Henry  Counties.  The market area is part of the
         Atlanta,  Georgia metropolitan statistical area. The Bank is subject to
         examination  and  comprehensive  regulation by the State of Georgia and
         the Federal Deposit Insurance Corporation ("FDIC") and its deposits are
         federally insured by the Savings Association Insurance Fund ("SAIF") of
         the FDIC. The Bank is a member of and owns capital stock in the Federal
         Home Loan Bank  ("FHLB")  of  Atlanta,  which is one of the 12 regional
         banks in the FHLB  System.  The  Company  is also  subject to state and
         federal regulation.

         The Bank  attracts  deposits  from the  general  public  and uses  such
         deposits primarily to invest in and originate  commercial,  residential
         and consumer  loans and, to a lesser  extent,  to invest in  investment
         securities.  The  principal  sources  of funds for the  Bank's  lending
         activities  are  deposits,  Federal Home Loan Bank  borrowings  and the
         amortization,   repayment,   and  maturity  of  loans  and   investment
         securities.  Principal  sources  of income  are  interest  on loans and
         investment securities. The Bank's principal expense is interest paid on
         deposits.

         Stock Market Information

         Since its issuance in July 1995,  the Company's  common stock  ("Common
         Stock") has been traded on the Nasdaq SmallCap Market under the trading
         symbol  of  "CCFH."  The  daily  stock  quotation  for the  Company  is
         published under the symbol "CCF." The following table reflects high and
         low prices paid on actual transactions as well as dividend information.
         The quotations reflect  inter-dealer prices, and may not include retail
         mark-up, mark-down, or commission.

             Period               High      Low      Dividends    Dividends
                                                     Declared        Paid

1998      First Quarter (1)      $20.00   $18.64    $   .15      $   .25
1998      Second Quarter (1)      21.82    19.55        .15          .15
1998      Third Quarter (1)       20.00    15.23        .15          .15
1998      Fourth Quarter (1)      16.36    11.82        .15          .15

1999      First Quarter (1)       17.36    11.98        .08          .15
1999      Second Quarter          17.75    14.25        .08          .08
1999      Third Quarter           18.12    17.06        .08          .08
1999      Fourth Quarter          17.56    14.50        .08          .08

-----------------
(1)  Dividends  declared and dividends paid were restated to reflect a 10% stock
     dividend declared on April 2, 1999.

                                       2
<PAGE>
                  The number of  stockholders of record as of December 31, 1999,
         was approximately  400,  inclusive of the number of persons or entities
         who held stock in nominee or "street"  name through  various  brokerage
         firms. At December 31, 1999, there were 980,855 shares outstanding, net
         of 7,615 shares held as treasury shares.  The Company's  ability to pay
         dividends to stockholders is primarily  dependent upon the dividends it
         receives  from the Bank and to a lesser  extent  the  amount of cash on
         hand.  The Bank may not  declare or pay a cash  dividend  on any of its
         stock if the effect thereof would cause the Bank's  regulatory  capital
         to be reduced below (1) the amount required for the liquidation account
         established in connection with the Conversion (up to $6.6 million),  or
         (2) the regulatory capital requirements.
<TABLE>
<CAPTION>
                        SELECTED FINANCIAL AND OTHER DATA
                        ---------------------------------

           Financial  Condition                                 At December 31,                     At September 30,(1)
           (Dollars in thousands)
                                                  ------------------------------------------- ------------------------------
                                                      1999          1998           1997            1996           1995
                                                      ----          ----           ----            ----           ----
<S>                                                 <C>             <C>            <C>             <C>             <C>
           Total Amount of:

                  Assets                             196,782         169,860        124,956         80,283          79,822

                  Loans receivable, net              146,553         121,827         97,541         51,500          45,196

                  Mortgage-backed securities             125             201          1,838         10,025           7,896

                  Investment securities               28,378          29,256          9,722         13,353          15,671

                  Liabilities                        184,800         158,234        113,436         65,843          62,501

                  Deposits                           165,526         154,977         91,201         61,822          61,132

                  Securities sold under
                      agreements to repurchase         3,998           1,117          2,393              -

                  FHLB advances                       13,100               -         18,510          2,500

                  Stockholders' equity                11,982          11,626         11,519         14,440          17,322

             Other Data:

                  Net income                           1,003             619            137            473             604

                  Average assets                     185,376         152,652         99,675         79,348          72,229

                  Average equity                      12,186          10,499         11,934         16,733           8,973

                  Full service offices (2)                 5               5              5              1               1

</TABLE>

--------------------
(1)  The Company  changed its fiscal year end from  September  30 to December 31
     during December 1996.
(2)  During  1997,  the Bank opened two new offices and  converted  two existing
     customer service facilities into full service offices.

                                       3
<PAGE>
<TABLE>
<CAPTION>
                                                                                           Year Ended
Summary of Operations (Dollars in thousands)              Year Ended December 31,       September 30, (1)
                                                        ----------------------------    ----------------
                                                               30, (1)
                                                           1999      1998      1997       1996      1995
                                                        -------   -------    ------     ------   -------
<S>                                                    <C>       <C>        <C>        <C>       <C>
Total interest income                                    14,671    12,437     8,090 (3) 5,573      5,021

Total interest expense                                    7,501     6,800     3,921     2,527      2,479
                                                        -------   -------   -------   -------    -------

     Net interest income                                  7,170     5,637     4,169     3,046      2,542

Provision for loan losses                                   341       275       126       130          5
                                                        -------   -------   -------   -------    -------

     Net interest income after provision for              6,829     5,362     4,043     2,916      2,537
     loan losses

Other income                                                843       968       909 (3)   415        328

Other expenses (2)                                        6,143     5,380     4,743     2,715      1,668
                                                        -------   -------   -------   -------    -------

Earnings before income taxes                              1,529       950       206       616        897

Income tax expense                                          526       331        69       143        293
                                                        -------   -------   -------   -------    -------

Net earnings                                            $ 1,003       619       137       473        604
                                                        =======   =======   =======   =======    =======
</TABLE>

(1)  The Company  changed its fiscal year end from  September  30 to December 31
     during December 1996.
(2)  In  1996,  the  Company   included  a  $398,000  one  time   assessment  to
     recapitalize the Savings Association Insurance Fund ("SAIF") of the FDIC.
(3)  Number has been  adjusted to include  fee income  reported in 1997 as other
     income and now  changed to  interest  income.  The fee income in year ended
     September  30, 1995 was not material to the balances  reports.  The fees in
     almost all cases are prepaid  interest  that is amortized  over the life of
     the loan or taken into income up front to offset loan  booking  expense per
     FASB 91.


                                       4

<PAGE>
         Key Operating Ratios
<TABLE>
<CAPTION>
                                                            For the Year Ended           For the Year Ended
                                                            ------------------           ------------------
                                                               December 31,               September 30, (1)
                                                               ------------               -----------------
Performance ratios:                                    1999        1998        1997       1996        1995
                                                       ----        ----        ----       ----        ----

<S>                                                 <C>        <C>         <C>         <C>        <C>
Return on average assets (net earnings divided by
    average total assets)                               0.54%      0.40%       0.14%       0.60%      0.84%

Return on average equity (net earnings divided by
    average total assets)                               8.23%      5.92%       1.14%       2.83%      6.73%

Average   interest   earning   assets  to   average
  interest bearing liabilities                        108.05%    107.14%     112.88%     122.83%    110.75%

Net interest rate spread                                3.89%      3.61%       3.87%       3.15%      3.31%

Net yield on average interest-earnings assets           4.19%      3.95%       4.41%       4.04%      3.70%

Net  interest   income  after  provision
  for  loan losses
    to total other expenses                           111.17%     99.68%      74.97%     107.40%    128.93%

Basic earnings per share                               $1.09      $0.67       $0.15       $0.41      $0.15

Diluted earnings per share                             $1.04      $0.64       $0.14       $0.39      $0.15

Dividend payout (1)                                    30.77%    100.00%     305.88%     111.11%      N/A

Capital Ratios

Book value per share                                  $12.21     $12.98      $11.65      $12.14     $12.03

Average equity to average assets (average equity
  to average total assets)                              6.57%      6.87%      11.97%     21.09%      12.42%

Equity-to-assets (End of Period)                        6.09%      6.84%       9.22%     17.99%      21.70%

Asset Quality Ratios

Non-performing loans to total loans, net                0.19%      0.09%       0.38%      1.17%       0.39%

Non-performing loans to total assets                    0.15%      0.07%       0.29%      0.75%       0.22%

Allowance for loan losses to non-performing loans     421.89%    865.70%     182.93%     89.90%     233.71%
</TABLE>

---------------------------
(1)  Dividends declared per share divided by net earnings per diluted share.

                                       5
<PAGE>
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

         General

         The  earnings of the Company  depend  primarily  on the earnings of the
         Bank. The largest  components of the Bank's net income are net interest
         income,  which is the difference  between interest income and loan fees
         and interest  expense,  and other income derived primarily from service
         fees  on  deposit  accounts.  Consequently,  the  Bank's  earnings  are
         dependent on its ability to originate loans,  net interest income,  and
         the relative amounts of  interest-earning  assets and  interest-bearing
         liabilities.  The Bank's net income is also  affected by its  provision
         for loan  losses and  foreclosed  real  estate as well as the amount of
         other expenses,  such as salaries and employee benefits,  occupancy and
         equipment, and federal deposit insurance premiums. Earnings of the Bank
         also are affected  significantly  by general  economic and  competitive
         conditions,  particularly changes in market interest rates,  government
         policies, and actions of regulatory authorities.

         Business Strategy

         The  Bank's  business  strategy  is  to  endeavor  to  be  a  flexible,
         efficient,   and  financially   stable  community   financial  services
         institution   providing  a  range  of  real  estate  lending  services,
         commercial  lending,  and consumer  financial products primarily to the
         Clayton,  Fayette,  and Henry County,  Georgia areas. The management of
         the Bank has  identified  and sought to pursue four  primary  strategic
         objectives:  (1) to maintain an adequate amount of regulatory  capital;
         (2) to reduce  interest  rate risk;  (3) to maintain good asset quality
         through continued emphasis on well underwritten  consumer,  commercial,
         and  residential  lending;  and (4) to broaden our product and customer
         base to become a more diversified financial institution.

         Regulatory  Capital.  After the  conversion  from mutual to stock,  the
         -------------------
         Company was  confronted  with issues new to its  operating  strategies,
         specifically  the managing of the excess capital in a manner that would
         increase  shareholder  value while at the same time provide  sufficient
         capital  levels to meet or exceed  regulatory  guidelines.  The Company
         originally  repurchased  more  than  30%  of its  original  outstanding
         shares,  most at  less  than  book  value.  In  addition,  the  Company
         increased its dividend  payout ratio as another means of excess capital
         management.

         As growth significantly outpaced management's  projections,  during the
         conversion  from the thrift to commercial  bank and the expansion  into
         two new markets, the excess capital management plan switched to capital
         shortfall  management.  In 1999,  the Company  established  a borrowing
         facility with a  correspondent  bank of $2.5 million for the purpose of
         infusing  capital into the Bank.  This was done to maintain the minimum
         capital levels for a well capitalized  institution.  As of December 31,
         1999 the Company had drawn  $900,000 of the $2.5  million.  The Company
         and the Bank continue to manage their respective  capital  positions in
         order to support the healthy growth they are experiencing.

         Reduction of Interest  Rate Risk.  The Bank  manages its interest  rate
         --------------------------------
         risk  through  the  origination  of  adjustable-rate  loans when market
         conditions permit.  The emphasis in the loan portfolio  continues to be
         to increase  the volume of loans that reprice at least  annually,  this
         will match the repricing of its liabilities.

         Asset Quality. The Bank continues to seek to maintain its asset quality
         -------------
         through  detailed   underwriting  and  through  analysis  of  its  loan
         requests. At December 31, 1999, the Bank's ratio of nonperforming loans
         to total loans was 0.19% and to total assets was 0.15%.

                                       6
<PAGE>
         Product and  Customer  Base.  The Bank  increased  the size of its loan
         ---------------------------
         portfolio by  approximately  $25 million between  December 31, 1998 and
         December 31, 1999. The increase is attributed to a growth in commercial
         real estate lending of 47%,  residential  construction  lending of 15%,
         consumer lending primarily through indirect lending  activities of 90%.
         The Bank's deposits increased by 7.1% from $155 million at December 31,
         1998 to $166 million at December  31, 1999 to partially  fund this loan
         growth.  In order to fund the difference in new loans and new deposits,
         the Bank had total  borrowings  at December  31,  1999 of  $13,100,000.
         There were no  borrowings  outstanding  as of December  31,  1998.  The
         ability to generate  large  amounts of new  deposits  during the fourth
         quarter of 1999 was believed to be hampered by general  public  concern
         around Y2K. It is expected  that during 2000 loan growth will  continue
         to be strong  considering  the  economic  expansion  within  the Bank's
         primary  trade  areas.  The Bank will seek to  continue  to expand  its
         customer base through advertising,  direct mail and one on one personal
         visits with prospective customers.

         The  management of the Bank believes that there are  opportunities  for
         growth within the Bank's primary market area and adjacent market areas,
         and the Bank  intends to manage the growth of  deposits  and loans in a
         manner that will  ensure its ability to comply with  current and future
         capital  requirements  as well as  manage  interest  rate  risk.  As is
         discussed  below,  with this growth comes risk,  and the ability of the
         Bank to manage  this risk will in large  measure  directly  impact  its
         financial  condition  and  operating  results  in future  periods.  The
         transition  the Bank has gone  through over the past couple of years is
         now complete and the maturing of the Bank's  balance  sheet is the next
         challenge.

         Asset and Liability Management

         Interest Rate Sensitivity.  The ability to maximize net interest income
         is largely  dependent on achieving a positive interest rate spread that
         can be sustained during  fluctuations in prevailing interest rates. The
         Bank,  like many other financial  institutions,  is subject to interest
         rate  risk   resulting   from  the   difference   in  the  maturity  of
         interest-bearing  liabilities (including deposits) and interest-earning
         assets (including loans) and the volatility of interest rates.  Because
         most deposit  accounts,  given their shorter  terms to maturity,  react
         more quickly to market  interest rate  movements  than do many types of
         loans,  increases in interest  rates may have an adverse  effect on the
         Bank's  earnings.  The Bank reduces this exposure by  diversifying  the
         loan portfolio to include more loans at primarily variable rates.

         The  Bank's  net  interest  rate  spread  was 3.61% for the year  ended
         December  31,  1998 and 3.89% for the year  ended  December  31,  1999.
         Results of the Company's  cumulative interest  sensitivity gap analysis
         indicate that a fluctuation  in interest rates would have only a slight
         impact on the Bank's net interest rate spread and earnings as the ratio
         of interest sensitive assets to interest  sensitive  liabilities in the
         one year time frame approximates one.

         The Bank  attempts  to manage the  interest  rates it pays on  deposits
         while  maintaining a stable deposit base and providing quality services
         to its customers.  The Bank has continued to rely primarily on deposits
         as its  source of  funds.  To the  extent  the Bank is unable to invest
         these funds in loans  originated  in the Bank's  market  area,  it will
         continue  to  purchase  municipal  securities  and other  high  quality
         investment securities.

         In an effort  to manage  interest  rate  risk and  protect  it from the
         negative effect of increases in interest rates, the Bank has instituted
         certain  asset  and  liability  management   measures,   including  the
         following:   1)   reduce   the   maturities   or   terms   to   reprice
         interest-earning  assets by emphasizing  the  origination of adjustable
         rate loans and the purchase of relatively  short-term  interest-earning
         investments and mortgage-backed  securities; 2) lengthen the maturities
         of interest-bearing  liabilities

                                       7
<PAGE>

         by  encouraging  depositors to invest in  longer term deposit  products
         offered by the Bank;  3)  increase  the  amount of less  rate-sensitive
         deposits by actively seeking demand deposit  accounts; and 4) encourage
         long-term  depositors to maintain their  accounts with the Bank through
         expanded customer products and services.

         Average  Balance  Sheets.   The  following  table  sets  forth  certain
         information  relating to the Bank's average balance sheets and reflects
         the average  yield on assets and average  cost of  liabilities  for the
         periods indicated. Such yields and costs are derived by dividing income
         or  expense  by  the   average   balance  of  assets  or   liabilities,
         respectively, for the periods presented.

<TABLE>
<CAPTION>
                                                            For the Years Ended December 31,
                                          ----------------------------------------------------------------------
                                                            1999                               1998
                                          ------------------------------------   -------------------------------
                                                        Interest                         Interest
                                            Average     Income               Average     Income
                                            Balance (4) Expense    Yield     Balance     Expense   Yield
                                         -----------    -------    -----     -------     -------   -----
<S>                                    <C>                <C>         <C>       <C>         <C>      <C>
Assets

Interest-earning assets:
   Loans (1) interest and fees           $  133,021    12,450      9.36%     114,359     10,778   9.42%
   Mortgage-backed securities                   167        11      6.59%         585         34   5.81%
   Investment securities                     30,646     1,689      5.49%      17,663      1,044   5.91%
   FHLB Stock                                   673        49      7.28%       1,013         75   7.40%
   Interest-earning deposits in other
       financial institutions and
       federal  funds sold                    8,590       472      5.49%       9,053        506   5.58%
                                         ----------    ------                -------     ------
    Total interest-earning assets           173,097    14,671      8.47%     142,673     12,437   8.72%
   Other noninterest-earning assets          12,279                            9,979
                                         ----------                          -------
    Total assets                            185,376                          152,652
                                         ==========                          =======

Liabilities and stockholders' equity:

Interest-bearing liabilities:
   Demand deposits                           56,512     2,013      3.56%      34,346      1,318   3.84%
   Regular savings                            8,300       187      2.25%       9,590        235   2.45%
   Time Deposits                             90,891     5,056      5.56%      84,841      5,011   5.91%
   FHLB Advances                              2,696       163      6.04%       2,363        135   5.71%
Securities sold under agreements to
repurchase                                    1,753        82      4.68%       2,027        101   4.98%
                                         ----------     -----                -------      -----
    Total interest-bearing liabilities      160,152     7,501      4.68%     133,167      6,800   5.11%
Non-interest bearing deposits                10,737                            7,076
Other noninterest bearing liabilities         2,301                            1,910

Stockholders' Equity                         12,186                           10,499
                                         ----------                          -------
    Total liabilities and stockholders'
    equity                                  185,376                          152,652
                                         ==========                          =======
Excess of interest-earning assets
   over interest-bearing liabilities     $   12,945                            9,506
                                         ==========                          =======
Ratio of interest-earning assets
   to interest bearing liabilities          108.08%                           107.14%
                                         ==========                          =======
Net interest income                      $              7,170                             5,637
                                                        =====                             =====
Net interest spread (2)                                            3.79%                          3.61%
                                                                   =====                          =====
Net yield on average interest-earning
   assets (3)                                                      4.14%                          3.95%
                                                                   =====                          =====
</TABLE>

------------------------------
(1)  Average balances include nonaccrual loans.
(2)  Net interest spread represents the difference  between the average yield on
     interest-earning   assets  and  the   average   cost  of   interest-bearing
     liabilities.
(3)  Net yield on average interest-earning assets represents net interest income
     as a percentage of average interest-earning assets.
(4)  Average balances are derived from average daily balances.

                                       8
<PAGE>
         Rate/Volume Analysis. The following table describes the extent to which
         changes in  interest  rates and  changes in volume of  interest-earning
         assets  and  interest-bearing  liabilities  have  affected  the  Bank's
         interest  income and  expense  during the periods  indicated.  For each
         category  of  interest-earning  asset and  interest-bearing  liability,
         information  is  provided  as to  changes  in volume  (change in volume
         multiplied by old rate) and changes in rates (change in rate multiplied
         by old volume).  The net change  attributable to changes in both volume
         and rate has been allocated proportionately to the change due to volume
         and the change due to rate.

<TABLE>
<CAPTION>
                                                Years Ended December 31,       Years Ended December 31,
                                            -----------------------------    ----------------------------
                                                     1999 and 1998                  1998 and 1997
                                            -----------------------------    ----------------------------
                                                1999 compared to 1998            1998 compared to 1997
                                            -----------------------------    ----------------------------
                                                                   Changes due to
                                            -------------------------------------------------------------
                                            Volume    Rate/Yield   Total      Volume   Rate/Yield   Total
                                            ------    ----------   -----      ------   ----------   -----
<S>                                       <C>          <C>       <C>        <C>          <C>      <C>
Interest income:

     Loans                                 $ 1,741        (69)     1,672      2,966        398      3,364
     Mortgage-backed securities                (27)         4        (23)      (169)        20       (149)
     Investment securities                     716        (71)       645      1,128       --        1,128
     FHLB stock                                (25)        (1)       (26)      --            1          1
     Interest-earning deposits in other
        financial institutions                 (26)        (8)       (34)        14        (11)         3
                                           -------    -------    -------    -------    -------    -------
          Total interest income            $ 2,379       (145)     2,234      3,939        408      4,347
                                           =======    =======    =======    =======    =======    =======

Interest expense:

     Demand deposits                       $   791        (96)       695        724        121        845
     Regular savings                           (29)       (19)       (48)       (29)        33          4
     Time deposits                             384       (339)        45      2,184        106      2,290
     FHLB advances                              20          8         28       (388)        34       (354)
     Securities sold under agreements to
         repurchase                            (13)        (6)       (19)        94       --           94
                                           -------    -------    -------    -------    -------    -------

          Total interest expense             1,153       (452)       701      2,585        294      2,879
                                           -------    -------    -------    -------    -------    -------
          Net interest income              $ 1,226        307      1,533      1,354        114      1,468
                                           =======    =======    =======    =======    =======    =======
</TABLE>


         Comparison of Financial Condition at December 31, 1999 and December 31,
         1998

         Total assets  increased  $27 million or 15.8% between the two dates due
         to increased lending from funds provided from increased  deposits.  The
         Bank invested $1.3 million in insurance  policies as a means of funding
         post employment  benefits for certain officers of the Bank.  Borrowings
         of  $13.1  million  from the  Federal  Home  Loan  Bank by the Bank and
         $900,000 from a  correspondent  by the Company were used to support the
         growth of the assets.  Stockholders'  equity increased by approximately
         $356,000  or 31% to $11.98  million at  December  31,  1999 from $11.63
         million at December 31, 1998.  The  increase  was  attributable  to net
         income  of  approximately  $1  million  that

                                       9
<PAGE>

         was partially offset by dividends declared of $290,000 and a  reduction
         of net  unrealized  holding  gains on investment  and mortgage   backed
         securities available for sale of approximately  $547,000.  The  Company
         carries  at  fair  value  its  securities  available  for  sale,   with
         unrealized gains and losses, net of income tax effects,  recorded as  a
         separate   component  of  stockholders'   equity  in  accordance   with
         Statement of Financial  Accounting Standards ("SFAS") No. 115.  Because
         the  Company's  portfolio of securities is classified as available  for
         sale,  volatility in the fair value of such securities  could  continue
         during  periods  of  changing  market  interest  rates.   Other   items
         contributing  to the change were employee stock  ownership plan  shares
         allocated   totaling   $142,000  and   management   stock  bonus   plan
         compensation expense of $79,000.

         Comparison of Operating Results For The Fiscal Years Ended December 31,
         1999 and December 31, 1998

         Net Earnings. The Company's net earnings increased by $384,000 or 62.1%
         from $619,000 in 1998 to $1,003,000 in 1999. The increase was primarily
         due to the 27.2% increase in net interest income from $5.6 million 1998
         to $7.2  million in 1999.  This  increase  in net  interest  income was
         partially  offset  by a 14.2%  increase  in other  expenses  from  $5.4
         million  in 1998 to $6.1  million  in  1999.  The net  interest  income
         increase is primarily  due to the  increased  lending  activities.  The
         increase in other  expenses is due  primarily  to  increased  personnel
         expenses related to lending and technology support.

         Net Interest  Income.  Net interest  income (before  provision for loan
         losses)  increased  from $5.6  million in 1998 to $7.2 million in 1999.
         This  increase  was  primarily  due to an increase in interest  and fee
         income on loans of $1.7 million,  more than  offsetting the increase in
         interest  expense  on  deposits  and FHLB  advances  of  $701,000.  The
         increases  in  lending  were  primarily  in   commercial,   residential
         construction and consumer loans. Commercial loans, including commercial
         real estate loans,  increased  approximately $18 million,  construction
         loans increased  approximately  $4 million and consumer loans increased
         approximately $12 million. Early in 1998 the Bank had an opportunity to
         bring on board an established  consumer indirect lender with a group of
         dealers.   The  Bank  decided  this  would  be  an  excellent   way  of
         diversifying  the loan portfolio in two ways, one to diversify the risk
         among  numerous   borrowers   dependent  on  many  different   economic
         conditions  and  secondly to  stabilize  the  repayment  stream to more
         traditional  short term installment  payments.  This has proved to be a
         successful  program to date with balances growing to approximately  $19
         million with a pretax yield of approximately  9.0%,  while  maintaining
         quality  ratios of equal or better  than the  direct  consumer  lending
         portfolio.

         Provision  For Loan Losses.  The Bank  increased the provision for loan
         losses from $275,000 in 1998 to $340,700 in 1999.  The increase was due
         to  management's  assessment  of the risk inherent in the portfolio and
         the  assessment  of the risk relative to the changes in the size of the
         portfolio. The Bank's allowance for loan losses increased from $943,000
         at December 31, 1998 to $1.2 million at December 31, 1999. The adequacy
         of the allowance for loan losses is evaluated  periodically  based on a
         review of all significant loans, with particular  emphasis on impaired,
         non-accruing, past due and other loans that management believes require
         special  attention.  The Bank also utilized an independent  loan review
         process in assessing  the overall  adequacy of the  allowance  for loan
         losses.  Management  believes  that its  allowance  for loan  losses is
         adequate.  Management will continue to monitor and adjust the allowance
         as necessary in future  periods based on growth in the loan  portfolio,
         loss experience, and continued monitoring of local economic conditions,
         as well  as,  any  other  external  factors.  If the  size of the  loan
         portfolio  continues to increase and the  relative  proportion  in that
         portfolio  of  commercial  and  construction  loans  increases,  it  is
         expected  that the  provision for loan losses will increase in order to
         maintain the allowance for loan losses at an adequate level.

         The following table sets forth the allocation of the allowance for loan
         losses by loan  category and the percent of loans in each loan category
         to total loans for the periods indicated.

                                       10
<PAGE>
<TABLE>
<CAPTION>
                                                       At December 31, 1999                  At December 31, 1998
                                                       --------------------                  --------------------
                                                                        Percent of                             Percent of
                                                     Amount in         Loans in each                          Loans in each
                                                     ---------         Category to                            Category to
                                                     Thousands          Total Loans              Amount          Total
                                                     ---------          -----------              ------          -----
<S>                                               <C>                   <C>                    <C>            <C>
         Loans
         Balance at end of period applicable to:
         Permanent residential mortgage            $      50               21.52%               $    70          31.86%
         Construction                                    487               20.29%                   337          21.26
         Commercial and commercial real estate           430               41.37%                   390          36.22
         Consumer and other                              270               16.82%                   146          10.66
                                                      ------               ------                ------          -----
            Total                                   $  1,237              100.00%                $  943         100.00%

</TABLE>

         Other Income.  Other income decreased by $125,000 from $968,000 in 1998
         to $843,000 in 1999.  This  decrease  was due in part to a reduction of
         $15,000  in the  gain on  sale of  mortgages  from  $63,000  in 1998 to
         $48,000 in 1999.  In addition,  the gain on sale of equity  investments
         decreased  from $387,000 in 1998 to $68,000 in 1999.  The reductions in
         these gains were partially  offset by a gain on sale of fixed assets in
         1999 of $58,000 and  increased  ordinary  other income items due to the
         changing  deposit  structure of the bank. Of these items,  included are
         service  charges on  deposit  accounts  which  increased  $66,000  from
         $437,000 in 1998 to $503,000 in 1999.

         Other Expenses.  Other expenses increased from $5.4 million during 1998
         to $6.2 million during 1999,  representing an approximate 15% increase.
         Included in this  increase  is an increase of $438,000 in salaries  and
         benefits  associated  with the continuing  expansion of the Bank's loan
         production  and  technology  areas.  The  remainder of the increases in
         other expenses was associated with increased data processing expense as
         a result of the increasing number of accounts and product line.

         Income Tax  Expense.  Income tax expense as a percent of income  before
         taxes  decreased  slightly  from  34.9% in 1998 to  34.4% in 1999.  The
         decrease  in the  effective  rate  is due to an  increase  of tax  free
         municipal investments held in the investment portfolio.

         Liquidity.  The Bank is required to maintain  minimum  levels of liquid
         assets as  defined by the State of  Georgia  and the FDIC  regulations.
         Short-term  liquidity at December  31, 1999 was 13.81%,  well below its
         goal of 25%.  As  discussed  earlier  the  Bank's  ability  to  attract
         deposits  during the fourth  quarter was hurt by general  Y2K  concerns
         along with  competition  from well  performing  mutual funds.  The Bank
         continues  to search for  deposits  and other means of meeting its loan
         demand. The Bank adjusts its liquidity level as appropriate to meet its
         asset/liability  objectives.  The primary source of funds are deposits,
         amortization and prepayments of loans and  mortgage-backed  securities,
         maturity of  investments,  and funds  provided from  operations.  As an
         alternative to supplement  liquidity needs, the Bank has the ability to
         borrow  from  the   Federal   Home  Loan  Bank  of  Atlanta  and  other
         correspondent   banks.  These  commitments  totaled  $18.5  million  at
         December 31, 1999 with $13.1 million drawn at that time. Scheduled loan
         amortization  and  maturing  investment  securities  are  a  relatively
         predictable source of funds, however, deposit flow and loan prepayments
         are greatly  influenced by, among other things,  market interest rates,
         economic conditions, and competition. The Bank's liquidity, represented
         by cash,  cash  equivalents,  and  securities  available for sale, is a
         product of its operating, investing, and financing activities.

                                       11
<PAGE>

         Impact of Inflation and Changing Prices

         The  financial  statements  and  related  data  have been  prepared  in
         accordance with generally accepted accounting  principles which require
         the measurement of financial position and operating results in terms of
         historical dollars,  without  consideration for changes in the relative
         purchasing power of money over time caused by inflation.

         Unlike industrial  companies,  nearly all of the assets and liabilities
         of a  financial  institution  are  monetary  in  nature.  As a  result,
         interest  rates  have  a  more   significant   impact  on  a  financial
         institution's  performance  than general levels of inflation.  Interest
         rates  do not  necessarily  move in the same  direction  or in the same
         magnitude  as the price of goods and  services,  since  such  goods and
         services  are  affected  by  inflation.  In the current  interest  rate
         environment,  liquidity and the maturity structure of the Bank's assets
         and   liabilities   are  critical  to  the  maintenance  of  acceptable
         performance levels.

                                       12
<PAGE>






               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS





The Board of Directors
CCF Holding Company

We have  audited the  accompanying  consolidated  balance  sheets of CCF Holding
Company  and  subsidiary  as of  December  31,  1999 and  1998  and the  related
consolidated statements of earnings, comprehensive income, stockholders' equity,
and cash flows for the years then ended. These consolidated financial statements
are the  responsibility of the Company's  management.  Our  responsibility is to
express an  opinion  on these  consolidated  financial  statements  based on our
audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects,  the financial position of CCF Holding Company
and  subsidiary  as of  December  31,  1999 and 1998,  and the  results of their
operations  and their cash flows for the years  then  ended in  conformity  with
generally accepted accounting principles.


                                         /s/Porter Keadle Moore, LLP



Atlanta, Georgia
February 18, 2000

                                       13
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
                           Consolidated Balance Sheets
                           December 31, 1999 and 1998
<TABLE>
<CAPTION>
                                     Assets
                                     ------
                                                                                               1999                   1998
                                                                                               ----                   ----
<S>                                                                                   <C>                        <C>
Cash and due from banks, including reserve
    requirements of  $940,000 and $766,000                                            $       5,035,910               7,275,835
Interest-bearing deposits in other financial institutions                                       535,920                 756,687
Federal funds sold                                                                            5,760,000               2,320,000
                                                                                           ------------           -------------
                  Cash and cash equivalents                                                  11,331,830              10,352,522

Investment securities available for sale                                                     28,503,446              29,457,412
Loans, net                                                                                  146,553,417             121,827,463
Premises and equipment, net                                                                   5,825,367               5,422,602
Federal Home Loan Bank stock, at cost                                                           655,200               1,013,200
Accrued interest receivable                                                                   1,306,698               1,114,880
Cash surrender value of life insurance                                                        1,337,344                       -
Other assets                                                                                  1,268,578                 671,863
                                                                                            -----------             -----------
                                                                                      $     196,781,880             169,859,942
                                                                                            ===========             ===========

                      Liabilities and Stockholders' Equity
                      ------------------------------------
Deposits:
     Noninterest-bearing deposits                                                     $      10,639,993               8,501,973
     Interest-bearing demand deposits                                                        55,163,460              44,555,271
     Savings accounts                                                                         7,529,549               9,089,074
     Time deposits less than $100,000                                                        71,861,450              74,388,954
     Time deposits greater than $100,000                                                     20,331,766              18,441,449
                                                                                            -----------             -----------
                  Total deposits                                                            165,526,218             154,976,721

Securities sold under agreement to repurchase                                                 3,998,419               1,117,264
Federal Home Loan Bank advances                                                              13,100,000
                                                                                                                              -
Line of credit                                                                                  900,000                       -
Other liabilities                                                                             1,274,901               2,139,844
                                                                                           ------------             -----------
                  Total liabilities                                                         184,799,538             158,233,829
                                                                                            -----------             -----------

Commitments
Stockholders' Equity:
     Preferred stock, no par value; 1,000,000 shares
        authorized; none issued and outstanding                                                       -                       -
     Common stock, $.10 par value, 4,000,000 shares
        authorized; 988,470 issued and 980,855 shares
        outstanding in 1999; 900,589 shares issued and
        895,148 outstanding in 1998                                                              98,847                  90,059
     Additional paid-in capital                                                               9,102,457               7,783,384
     Retained earnings                                                                        3,960,640               4,528,267
     Unearned ESOP shares                                                                      (396,000)               (468,000)
     Unearned compensation                                                                     (199,190)               (286,339)
     Treasury stock, at cost; 7,615 and 5,441 shares in
        1999 and 1998, respectively                                                             (75,876)                (59,777)
     Accumulated other comprehensive income (loss)
                                                                                               (508,536)                 38,519
                                                                                                                         ------

                  Total stockholders' equity                                                 11,982,342              11,626,113
                                                                                             ----------              ----------

                                                                                      $     196,781,880             169,859,942
                                                                                            ===========             ===========
</TABLE>

          See accompanying notes to consolidated financial statements.

                                       14
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
                       Consolidated Statements of Earnings
                 For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
                                                                                                       1999                1998
                                                                                                       ----                ----
<S>                                                                                           <C>                      <C>
Interest income:
     Interest and fees on loans                                                                 $    12,450,314          10,778,100
     Interest bearing deposits in other financial institutions                                          139,320              87,321
     Interest and dividends on taxable investment securities                                          1,745,554           1,151,744
     Interest on federal funds sold                                                                     331,779             419,122
     Interest on nontaxable investment securities                                                         3,679                 600
                                                                                                     ----------          ----------
          Total interest income                                                                      14,670,646          12,436,887
                                                                                                     ----------          ----------
Interest expense:
     Deposit accounts                                                                                 7,257,269           6,563,637
     Other borrowings                                                                                   243,673             235,923
                                                                                                     ----------          ----------
          Total interest expense                                                                      7,500,942           6,799,560
                                                                                                     ----------          ----------
          Net interest income                                                                         7,169,704           5,637,327

Provision for loan losses                                                                               340,700             275,000
                                                                                                    -----------        ------------
          Net interest income after provision for loan losses                                         6,829,004           5,362,327
                                                                                                    -----------        ------------
Other operating income:
     Service charges on deposit accounts                                                                502,878             436,886
     Net gain on sale of assets                                                                         105,997              62,628
     Net gain on sale of investment securities                                                           68,201             387,282
     Other                                                                                              166,067              80,934
                                                                                                    -----------        ------------
          Total other operating income                                                                  843,143             967,730
                                                                                                    -----------        ------------
Other operating expenses:
     Salaries and employee benefits                                                                   3,520,808           3,083,362
     Occupancy                                                                                        1,174,266           1,017,073
     Other                                                                                            1,447,867           1,279,157
                                                                                                    -----------        ------------
          Total other operating expenses                                                              6,142,941           5,379,592
                                                                                                    -----------        ------------
          Earnings before income taxes                                                                1,529,206             950,465

Income tax expense                                                                                      526,315             331,689
                                                                                                    -----------        ------------
          Net earnings                                                                          $     1,002,891             618,776
                                                                                                    ===========        ============
Basic earnings per share                                                                        $          1.09                0.67
                                                                                                           ====                ====
Diluted earnings per share                                                                      $          1.04                0.64
                                                                                                           ====                ====
</TABLE>

   See accompanying notes to consolidated financial statements.

                                       15
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
                 Consolidated Statements of Comprehensive Income
                 For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
                                                                                                 1999                 1998
                                                                                                 ----                 ----

<S>                                                                                       <C>                      <C>
Net earnings                                                                              $    1,002,891               618,776
                                                                                               ---------               -------
Other comprehensive income (loss):
     Unrealized holding gains (losses) on investment securities
         available for sale                                                                     (813,577)               91,303

     Less:  reclassification adjustment for gains on sales of investment
           securities available for sale                                                         (68,201)             (387,282)
                                                                                               ---------               -------

                   Total other comprehensive income (loss), before taxes                        (881,778)             (295,979)
                                                                                               ---------               -------

Income tax (expense) benefit related to other comprehensive income:
     Unrealized holding gains (losses) on investment securities
         available for sale                                                                      308,834               (34,695)

     Less:  reclassification adjustment for gains on sales of investment
           securities available for sale                                                          25,889               147,223
                                                                                               ---------               -------

                   Total income tax benefit related to other comprehensive income                334,723               112,528
                                                                                               ---------               -------

                   Total other comprehensive income (loss), net of tax                          (547,055)             (183,451)
                                                                                               ---------               -------

                   Total comprehensive income                                             $      455,836               435,325
                                                                                               =========               =======

</TABLE>

   See accompanying notes to consolidated financial statements.

                                       16
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
                 Consolidated Statements of Stockholders' Equity
                 For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
                                              Common Stock          Additional                    Unearned
                                              ------------            Paid-in        Retained       ESOP        Unearned
                                          Shares        Amount        Capital        Earnings      Shares     Compensation
                                          ------        ------        -------        --------      ------     ------------
<S>                                    <C>        <C>               <C>           <C>           <C>            <C>
Balance December 31, 1997                906,710    $   90,671        7,794,459     4,443,500     (540,000)      (394,195)
Net earnings                                   -             -                -       618,776            -              -
Dividends declared ($.64 per share )           -             -                -      (534,009)           -              -
Retirement of treasury stock              (6,121)         (612)        (105,953)            -            -              -
ESOP shares allocated                          -             -           94,878             -       72,000              -
Forfeited shares under
     management stock bonus plan               -             -                -             -            -         25,692
Award of shares under
     management stock bonus plan               -             -                -             -            -        (16,495)
Earned compensation under
     management stock bonus plan               -             -                -             -            -         98,659
Treasury stock purchased                       -             -                -             -            -              -
Unrealized losses on investment
     securities available for sale,
     net of tax effect                         -             -                -             -            -              -
                                        ------------   ---------- ---------------  -----------    ---------    ----------
Balance, December 31, 1998               900,589        90,059        7,783,384     4,528,267     (468,000)      (286,339)

Net earnings                                   -             -                -     1,002,891            -              -
10 % stock dividend                       89,824         8,983        1,271,845    (1,280,828)           -              -
Dividends declared ($.32 per share)            -             -                -      (289,690)           -              -
Retirement of common stock                (1,943)         (195)         (30,499)            -            -              -
ESOP shares allocated                          -             -           70,148             -       72,000              -
Forfeited shares under
     management  stock bonus plan              -             -                -             -            -         36,000
Awarded shares under
      management stock bonus plan              -             -            7,579             -            -        (27,480)
Earned compensation under
     management stock bonus plan               -             -                -             -            -         78,629
Unrealized losses on investment
      securities available for sale,
      net of tax                               -             -                -             -            -              -
                                         -------        ------        ---------     ---------    ---------       --------
Balance, December 31, 1999               988,470    $   98,847        9,102,457     3,960,640     (396,000)      (199,190)
                                         =======        ======        =========     =========     ========       ========
</TABLE>
<TABLE>
<CAPTION>
                                                                    Accumulated
                                                                       Other
                                            Treasury Stock         Comprehensive
                                         Shares          Amount    Income (Loss)      Total
                                         ------          ------    -------------      -----
<S>                                     <C>       <C>               <C>            <C>
Balance December 31, 1997                 7,686     $   (96,800)      221,970        11,519,605
Net earnings                                  -               -             -           618,776
Dividends declared ($.64 per share )          -               -             -          (534,009)
Retirement of treasury stock             (6,121)        106,565             -                 -
ESOP shares allocated                         -               -             -           166,878
Forfeited shares under
     management stock bonus plan          2,357         (25,692)            -                 -
Award of shares under
     management stock bonus plan         (1,500)         16,495             -                 -
Earned compensation under
     management stock bonus plan              -               -             -            98,659
Treasury stock purchased                  3,019         (60,345)            -           (60,345)
Unrealized losses on investment
     securities available for sale,
     net of tax effect                        -               -      (183,451)         (183,451)
                                      ---------        --------      ---------     -------------
Balance, December 31, 1998                5,441         (59,777)       38,519        11,626,113

Net earnings                                  -               -             -         1,002,891
10 % stock dividend                         874               -             -               -
Dividends declared ($.32 per share)           -               -             -          (289,690)
Retirement of common stock                    -               -             -           (30,694)
ESOP shares allocated                         -               -             -           142,148
Forfeited shares under
     management  stock bonus plan         3,300         (36,000)            -                 -
Awarded shares under
      management stock bonus plan         (2,000)        19,901             -                 -
Earned compensation under
     management stock bonus plan              -               -             -            78,629
Unrealized losses on investment
      securities available for sale,
      net of tax                              -               -      (547,055)         (547,055)
                                         ------         -------       -------      ------------
Balance, December 31, 1999                7,615     $   (75,876)     (508,536)       11,982,342
                                          =====         =======       =======        ==========
</TABLE>
See accompanying notes to consolidated financial statements.

                                       17
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
                      Consolidated Statements of Cash Flows
                 For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
                                                                                                         1999              1998
                                                                                                         ----              ----
<S>                                                                                                 <C>          <C>
Cash flows from operating activities:
     Net earnings                                                                                   $ 1,002,891       618,776
      Adjustments to reconcile net earnings to net cash provided by operating activities:
           Provision for loan losses                                                                    340,700       275,000
           Depreciation, amortization and accretion                                                     222,572       311,766
           ESOP shares allocated                                                                        142,148       166,878
           Compensation expense related to MSBP                                                          78,629        98,659
           Net gain on sale of investment securities available for sale                                 (68,201)     (387,282)
           Deferred income tax benefit                                                                  (19,862)     (131,348)
           Net gain on sale of loans                                                                    (47,638)      (62,628)
           Net loss (gain) on sale of premises and equipment                                            (58,359)          452
           Increase in accrued interest                                                                (191,818)     (330,028)
           Increase in other assets                                                                    (576,854)     (468,313)
           (Decrease) increase in other liabilities                                                    (508,167)    1,130,370
                                                                                                       --------- -- ---------
                     Net cash provided by operating activities                                          316,041     1,222,302
                                                                                                        -------  -- ---------
Cash flows from investing activities:
      Proceeds from maturities and called investment securities available for sale                   27,502,315    29,328,303
      Proceeds from sales of investment securities available for sale                                   620,858     3,021,729
      Purchases of investment securities available for sale                                          27,683,395)  (50,012,878)
      Redemption of FHLB stock                                                                          358,000             -
      Net increase in loans                                                                          33,618,250)  (41,676,028)
      Proceeds from sale of loans                                                                     8,599,234    17,177,424
      Purchases of premises and equipment                                                              (961,873)     (754,597)
      Proceeds from sale of equipment                                                                   135,661         2,155
      Purchase of life insurance policies                                                            (1,337,344)            -
                                                                                                     ----------   -----------
                     Net cash used in investing activities                                          (26,384,794)  (42,913,892)
                                                                                                     ----------    ----------
Cash flows from financing activities:
      Net increase in demand and savings deposits                                                    11,186,684    25,450,793
      Net (decrease) increase in time deposits                                                         (637,187)   38,324,588
      Net increase (decrease) in securities sold under agreements to repurchase                       2,881,155    (1,275,315)
      Treasury stock purchased                                                                                -       (60,345)
      Federal Home Loan Bank advances                                                                13,100,000             -
      Repayment of Federal Home Loan Bank advances                                                            -   (18,510,000)
      Proceeds from line of credit                                                                      900,000             -
      Dividends paid                                                                                   (351,897)     (626,925)
      Retirement of common stock                                                                        (30,694)            -
                                                                                                     ----------   -----------
                     Net cash provided by financing activities                                       27,048,061    43,302,796
                                                                                                     ----------    ----------
                     Increase in cash and cash equivalents                                              979,308     1,611,206

Cash and cash equivalents at beginning of period                                                     10,352,522     8,741,316
                                                                                                     ----------    ----------

Cash and cash equivalents at end of period                                                          $11,331,830    10,352,522
                                                                                                     ==========    ==========
Supplemental  disclosure  of cash flow  information  and noncash  investing  and
financing activities:
         Interest paid                                                                              $ 7,559,075     6,533,149
                                                                                                     ==========     =========
         Income taxes paid                                                                          $   528,000        15,000
                                                                                                     ==========     =========
         Changes in unrealized losses on investment securities available for sale                   $  (547,055)     (183,451)
                                                                                                     ==========     =========
         Retirement of treasury stock                                                               $         -       106,565
                                                                                                     ===========    =========
         Changes in dividends payable                                                               $   (62,207)      (92,916)
                                                                                                     ==========     =========
</TABLE>
  See accompanying notes to consolidated financial statements.

                                       18
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
                   Notes to Consolidated Financial Statements

(1)  Summary of Significant Accounting Policies
     Organization
     ------------
     CCF Holding Company (the "Company") is incorporated in the state of Georgia
     as a state  chartered  bank holding  company whose business is conducted by
     its wholly owned bank subsidiary,  Heritage Bank (the "Bank").  The Company
     converted  its  charter  effective  September  1,  1998  from  a  federally
     chartered  stock  savings  and  loan   association  to  a  state  chartered
     commercial  bank.  The Company and the Bank are primarily  regulated by the
     State of Georgia  Department  of Banking  and  Finance  (the "DBF") and the
     Federal  Deposit  Insurance  Corporation  (the  "FDIC")  and are subject to
     periodic examinations by these regulatory authorities.

     The Bank  provides a full  range of  banking  services  to  individual  and
     corporate customers through its main office in Jonesboro,  Georgia and four
     Georgia branch offices located in Clayton, Fayette, and Henry Counties. The
     Bank primarily  competes with other  financial  institutions  in its market
     area, which it considers to be South Metropolitan Atlanta.

     Basis of Presentation
     ---------------------
     The consolidated  financial  statements include the accounts of the Company
     and the Bank. All significant  intercompany  accounts and transactions have
     been   eliminated  in   consolidation.   Certain  1998  amounts  have  been
     reclassified to conform to the 1999 presentation.

     The  accounting  principles  followed  by the  Company  and the  methods of
     applying  these  principles,  conform with  generally  accepted  accounting
     principles ("GAAP") and with general practices within the banking industry.
     In preparing  financial  statements in conformity with GAAP,  management is
     required to make estimates and assumptions that affect the reported amounts
     in the financial statements. Actual results could differ significantly from
     those estimates. Material estimates common to the banking industry that are
     particularly  susceptible to  significant  change in the near term include,
     but are not limited to, the  determination of the allowance for loan losses
     and the valuation of real estate  acquired in connection with or in lieu of
     foreclosure on loans.

     Cash and Cash Equivalents
     -------------------------
     For  purposes of the  consolidated  statements  of cash flows,  the Company
     considers  amounts  due  from  banks,  interest-bearing  deposits  in other
     financial institutions and federal funds sold to be cash equivalents.

     Investment Securities
     ---------------------
     The Company classifies its securities in one of three categories:  trading,
     available for sale, or held to maturity.  Trading securities are bought and
     held principally for sale in the near term. Held to maturity securities are
     those  securities  for which the Company has the ability and intent to hold
     until  maturity.  All other  securities  not included in trading or held to
     maturity  are  classified  as available  for sale.  The  Company's  current
     investment policy prohibits trading activity.

     Held  to  maturity  securities  are  recorded  at  cost,  adjusted  for the
     amortization or accretion of premiums or discounts. Transfers of securities
     between  categories  are  recorded  at fair value at the date of  transfer.
     Unrealized  holding gains or losses associated with transfers of securities
     from held to  maturity  to  available  for sale are  recorded as a separate
     component of stockholders' equity.

     Available  for  sale  securities  consist  of  investment   securities  not
     classified  as trading  securities or held to maturity  securities  and are
     recorded at fair value.  Unrealized  holding gains and losses on securities
     available  for  sale are  excluded  from  earnings  and are  reported  as a
     separate component of stockholders' equity until realized.

     A decline in the market value of any available for sale or held to maturity
     investment  below cost that is deemed  other than  temporary  is charged to
     earnings and establishes a new cost basis for the security.

     Premiums  and  discounts  are  amortized  or accreted  over the life of the
     related  security as an adjustment to the yield.  Realized gains and losses
     for  securities  classified  as available for sale and held to maturity are
     included in  earnings  and are derived  using the  specific  identification
     method for determining the cost of securities sold.
<PAGE>
     Federal Home Loan Bank Stock
     ----------------------------
     Investment in Federal Home Loan Bank stock is required of federally insured
     financial  institutions that utilize their services. No ready market exists
     for the stock and it has no quoted market value.

                                       19
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(1)  Summary of Significant Accounting Policies, continued
     Loans
     -----
     Loans  that  management  has  the  intent  and  ability  to  hold  for  the
     foreseeable  future or until maturity are reported at the principal  amount
     outstanding,  net of the allowance for loan losses and any deferred fees or
     costs on originated loans. Interest on all loans is calculated  principally
     by using the simple  interest  method on the daily balance of the principal
     amount outstanding.

     Loan  origination  fees collected,  net of certain direct loan  origination
     costs, are deferred and recognized into income using the interest method as
     an adjustment of the yield over the lives of the underlying loans.

     The  accrual of  interest  income is  discontinued  on loans  which  become
     contractually  past due by 90 days.  Interest  previously  accrued  but not
     collected is reversed  against  current  period  interest  income when such
     loans are placed on nonaccrual  status.  Interest  accruals are recorded on
     such  loans  only when they are  brought  fully  current  with  respect  to
     interest and principal and when, in the judgment of  management,  the loans
     are estimated to be fully collectible as to both principal and interest.

     A loan is  considered  impaired  when,  based on  current  information  and
     events,  it is probable that all amounts due  according to the  contractual
     terms of the loan  agreement  will not be  collected.  Impaired  loans  are
     measured  based  on  the  present  value  of  expected  future  cash  flows
     discounted  at  the  loan's  effective  interest  rate,  or at  the  loan's
     observable market price, or at the fair value of the collateral of the loan
     if the loan is collateral dependent. Interest income from impaired loans is
     recognized using a cash basis method of accounting.

     Allowance for Loan Losses
     -------------------------
     The allowance for loan losses is  established  through a provision for loan
     losses charged to expense. Loans are charged against the allowance for loan
     losses  when  management  believes  that the  collection  of  principal  is
     unlikely.   The  Bank  has   established   a  loan  grading   system  whose
     classifications  are consistent  with those used by the Bank's  regulators.
     Management  utilizes  this system to evaluate the adequacy of its allowance
     for loan losses.  Allocations of loss are calculated based on expected loss
     ratios for each loan  classification.  These  ratios  have been  determined
     considering the Bank's  historical loss rates and  consideration  of losses
     experienced by its peer group. For individually significant loans deemed to
     be  impaired,  a specific  allowance is  established  based on the expected
     collectibility considering the borrower's cash flow and the adequacy of the
     collateral  coverage.  The results of the Bank's evaluation are compared to
     the  recorded  allowance  for loan losses and  significant  deviations  are
     adjusted  by  increasing  or  decreasing  the  provision  for loan  losses.
     Additionally,  management  utilizes  the services of an  independent  third
     party loan reviewer to validate its internal  grading system and to provide
     additional analysis in determining the adequacy of the allowance.

     Management  believes  the  allowance  for loan  losses is  adequate.  While
     management uses available  information to recognize losses on loans, future
     additions to the  allowance  may be necessary  based on changes in economic
     conditions.  In addition,  various regulatory agencies, as an integral part
     of their examination  process,  periodically  review the allowance for loan
     losses.  Such  agencies may require the Bank to recognize  additions to the
     allowance based on their judgments of information  available to them at the
     time of their examination.

     Premises and Equipment
     ----------------------
     Premises and  equipment are stated at cost less  accumulated  depreciation.
     Major  additions and  improvements  are charged to the asset accounts while
     maintenance  and repairs  that do not improve or extend the useful lives of
     the assets are expensed. When assets are retired or otherwise disposed, the
     cost and related  accumulated  depreciation  are removed from the accounts,
     and any gain or loss is reflected in earnings for the period.  Depreciation
     is recorded on a straight-line  basis over the following  estimated  useful
     lives of the related assets:

                   Building and improvements                  5 - 40 years
                   Furniture and equipment                    2 - 10 years


<PAGE>
     Income Taxes
     ------------
     Deferred  tax  assets  and  liabilities  are  recorded  for the  future tax
     consequences  attributable to differences  between the financial  statement
     carrying  amounts of existing assets and  liabilities and their  respective
     tax bases.  Deferred tax assets and  liabilities are measured using enacted
     tax rates  expected  to apply to  taxable  income in the years in which the
     assets and liabilities are expected to be recovered or settled.  The effect
     on  deferred  tax  assets  and  liabilities  of a  change  in tax  rates is
     recognized  in income tax expense in the period that includes the enactment
     date.
                                       20
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(1)  Summary of Significant Accounting Policies, continued
     Income Taxes, continued
     ------------
     In the event  the  future  tax  consequences  of  differences  between  the
     financial  reporting  bases and the tax bases of the  Company's  assets and
     liabilities result in deferred tax assets, an evaluation of the probability
     of being able to realize  the future  benefits  indicated  by such asset is
     required. A valuation allowance is provided for the portion of the deferred
     tax asset when it is more likely  than not that some  portion or all of the
     deferred tax asset will not be realized.  In assessing the realizability of
     the deferred tax assets,  management  considers the scheduled  reversals of
     deferred tax liabilities, projected future taxable income, and tax planning
     strategies.

     Net Earnings Per Share
     ----------------------
     Basic earnings per share are based on the weighted average number of common
     shares  outstanding during the period while the effects of potential shares
     outstanding  during the period are included in diluted  earnings per share.
     The  reconciliation  of the amounts used in the  computation of both "basic
     earnings  per share" and  "diluted  earnings  per share" for each period an
     earnings statement is presented as follows:
<TABLE>
<CAPTION>
For the year ended December 31, 1999                    Net          Common         Per Share
                                                      Earnings       Shares           Amount
                                                      --------       ------           ------
<S>                                              <C>               <C>        <C>
Basic earnings per share                         $   1,002,891       922,120    $      1.09
                                                                                       ====
Effect of stock options                                      -        38,849
                                                     ---------      --------
Diluted earnings per share                       $   1,002,891       960,969    $      1.04
                                                     =========       =======           ====
</TABLE>
<TABLE>
<CAPTION>
 For the year ended December 31, 1998                    Net          Common         Per Share
                                                      Earnings        Shares          Amount
                                                      --------        ------          ------
<S>                                            <C>                  <C>        <C>
 Basic earnings per share                        $      618,776       923,605    $     0.67
                                                                                       ====
 Effect of stock options                                      -        47,846
                                                        -------        ------
 Diluted earnings per share                      $      618,776       971,451    $     0.64
                                                        =======       =======          ====
</TABLE>
      For purposes of computing weighted-average shares outstanding, unallocated
      shares  under  the  Company's   employee  stock  ownership  plan  are  not
      considered  outstanding  until  they  are  committed  to be  released  for
      allocation.  The above  detail was adjusted to reflect the  Company's  10%
      1999 stock dividend.

      Recent Accounting Pronouncements
      --------------------------------
      In 1998,  the Financial  Accounting  Standards  Board issued SFAS No. 133,
      "Accounting for Derivative  Instruments and Hedging Activities".  SFAS No.
      133 establishes  accounting and reporting standards for hedging activities
      and for derivative  instruments including derivative  instruments embedded
      in other contracts.  It requires the fair value recognition of derivatives
      as assets or liabilities in the financial  statements.  The accounting for
      the changes in the fair value of  derivatives  depends on the intended use
      of the  derivative  instruments  at inception.  In 1999,  SFAS No. 137 was
      issued which changed the implementation date of SFAS No. 133. SFAS No. 133
      becomes  effective for all fiscal  quarters of all fiscal years  beginning
      after June 15, 2000, but initial application of the statement must be made
      as of the beginning of the quarter. At the date of initial application, an
      entity may transfer any held to maturity  security  into the available for
      sale or trading  categories  without  calling  into  question the entity's
      intent to hold other  securities  to maturity  in the future.  The Company
      believes the adoption of these  standards will not have a material  impact
      on its financial position, results of operations or liquidity.

                                       21
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

 (2) Investment Securities
     At December 31, 1999 and 1998,  investment  securities  available  for sale
consisted of the following:
<TABLE>
<CAPTION>
                                                                               December 31, 1999
                                                   --------------------------------------------------------------------

                                                                              Gross            Gross
                                                          Amortized        Unrealized       Unrealized           Fair
                                                            Cost              Gains           Losses             Value
                                                            ----              -----           ------             -----
<S>                                                <C>                     <C>              <C>            <C>
         U.S. Treasury and U.S. Government
           agency obligations                        $  28,373,903               -            774,504        27,599,399
         Municipal securities                              787,230               -              8,426           778,804
         Mortgage-backed securities                        124,676             567                  -           125,243
                                                      ------------             ---      -------------      ------------

                                                     $  29,285,809             567            782,930        28,503,446
                                                        ==========             ===            =======        ==========
</TABLE>

<TABLE>
<CAPTION>
                                                                               December 31, 1998
                                                     -------------------------------------------------------------------
                                                                              Gross            Gross
                                                          Amortized        Unrealized       Unrealized           Fair
                                                            Cost              Gains           Losses             Value
                                                            ----              -----           ------             -----
<S>                                                <C>                     <C>              <C>            <C>
         U.S. Treasury and U.S. Government
           agency obligations                        $  29,137,872          13,964             29,894        29,121,942
         Equity security                                    64,455          69,545                  -           134,000
         Mortgage-backed securities                        195,825           5,645                  -           201,470
                                                      ------------       ---------         ----------      ------------

                                                     $  29,398,152          89,154             29,894        29,457,412
                                                        ==========        ========             ======        ==========
</TABLE>

     For the years ended  December  31, 1999 and 1998,  the Company sold certain
     investment  securities  available  for sale for  $620,858  and  $3,021,729,
     respectively with the following gross gains and losses recognized:

                                 1999        1998
                                 ----        ----

Gross gains             $       68,201     392,479
Gross losses            $          -         5,197

     The  amortized  cost and fair values of  securities  available  for sale at
     December  31, 1999,  by  contractual  maturity  are shown  below.  Expected
     maturities may differ from  contractual  maturities  because  borrowers may
     have the  right  to call or  prepay  obligations  with or  without  call or
     prepayment penalties.
                                                  Amortized        Fair
                                                     Cost          Value
                                                     ----          -----

      Due within one year                     $     1,999,638      1,985,624
      Due after one year through five years        24,402,040     23,687,839
      Due after five years                          2,759,455      2,704,740
      Mortgage-backed securities                      124,676        125,243
                                                   ----------     ----------
                                              $    29,285,809     28,503,446
                                                   ==========     ==========

       Investment  securities with  approximate  aggregate  carrying  amounts of
       $21,358,000  and  $22,380,000 at December 31, 1999 and December 31, 1998,
       respectively,  were pledged to secure public deposits and securities sold
       under agreements to repurchase.

                                       22
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(3)    Loans
       Major  classifications  of  loans  at  December  31,  1999  and  1998 are
presented below:

                                                    1999         1998
                                                    ----         ----

Commercial real estate                           $ 57,442,687   39,050,751
Commercial                                          3,922,862    5,636,988
Real estate - mortgage                             31,927,010   39,299,642
Real estate - construction                         30,105,725   26,227,514
Installment and other consumer                     24,938,924   13,142,301
                                                   ----------   ----------

        Total loans                               148,337,208  123,357,196

        Less:  Unearned fees                          546,769      586,584
                  Allowance for loan losses         1,237,022      943,149
                                                  -----------  -----------
        Total loans, net                         $146,553,417  121,827,463
                                                  ===========  ===========

       The Company extends credit to customers throughout its market area, which
       includes the Georgia counties of Clayton, Henry, and Fayette. Most of the
       Company's  loans  are  collateralized  by real  estate  in these  Georgia
       counties and a  substantial  portion of its  borrowers'  ability to repay
       such loans is dependent upon the economy in the Company's market area.

       An analysis of the activity in the allowance for loan losses is presented
below:

                                                   1999       1998
                                                   ----       ----

Balance at beginning of period                  $  943,149    669,505
Provision for losses on loans                      340,700    275,000
Loan charge-offs                                   (71,233)    (2,674)
Loan recoveries                                     24,406      1,318
                                                 ---------    -------
Balance at end of period                        $1,237,022    943,149
                                                 =========    =======

       As of December 31, 1999 and 1998, the Bank serviced loans for others with
       approximate   outstanding   balances  of  $26,984,000  and   $22,396,000,
       respectively.

(4)    Premises and Equipment
       A summary of premises  and  equipment at December 31, 1999 and 1998 is as
follows:

                                                       1999            1998
                                                       ----            ----

Land                                            $      756,655         803,927
Buildings and improvements                           3,806,946       3,719,942
Furniture and equipment                              3,039,631       2,286,524
Construction in progress                                36,314          17,400
                                                     ---------       ---------
                                                     7,639,546       6,827,793

         Less: Accumulated depreciation              1,814,179       1,405,191
                                                     ---------       ---------
                                                $    5,825,367       5,422,602
                                                     =========       =========


       Depreciation  expense for the years ended  December 31, 1999 and 1998 was
$481,806 and $441,726, respectively.

                                       23
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(5)    Deposits
       At December 31, 1999,  the  scheduled  maturities of time deposits are as
follows:


                     2000         $76,843,807
                     2001           8,971,720
                     2002           5,851,564
                     2003             526,125
                                   ----------
                                  $92,193,216
                                  ===========

(6)    Income Taxes
       The components of income tax expense are as follows:

                                    1999         1998

Current expense                  $  546,177      463,037
Deferred benefit                    (19,862)    (131,348)
                                    -------      --------

                                 $  526,315      331,689
                                    =======      =======

       Income tax expense of the Company  differed from the amounts  computed by
       applying the  statutory  Federal  income tax rate to income before income
       taxes as follows:
                                                              1999     1998
                                                              ----     ----

Tax expense at statutory rate                              $ 519,930  323,158
Add (deduct):
      State income taxes, net of Federal tax effect            6,486    7,781
      Other, net                                                (101)    (750)
                                                            --------  -------
                                                           $ 526,315  331,689
                                                             =======  =======

       The tax effects of temporary  differences  that give rise to  significant
       portions of the  deferred  tax assets and  deferred  tax  liabilities  at
       December 31, 1999 and 1998, are presented below:

<TABLE>
<CAPTION>
                                                                                1999        1998
                                                                                ----        ----

<S>                                                                      <C>               <C>
   Deferred tax assets:
       Allowance for loan losses                                           $    346,641      194,108
       State tax credit carryforwards                                            70,111       58,893
       Employee Stock Ownership Plan accrual                                     99,147       99,147
       Net unrealized losses on investment securities available for             273,827          -
       sale
       Other                                                                     12,024        6,720
                                                                              ---------      -------
   Total gross deferred tax assets                                              801,750      358,868
                                                                                -------      -------

   Deferred tax liabilities:
       Deferred loan fees                                                       458,427      366,168
       Net unrealized gains on investment securities available for sale               -       20,741
       Premises and equipment                                                   117,089       23,084
       Federal Home Loan Bank stock dividends                                   147,095      146,165
       Other                                                                     30,419       28,696
                                                                                -------      -------
   Total gross deferred tax liabilities                                         753,030      584,854
                                                                                -------      -------
   Net deferred tax assets (liabilities)                                   $     48,720     (225,986)
                                                                                =======      =======
</TABLE>


                                       24
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(6)    Income Taxes, continued
       At December 31, 1999 and 1998,  the Company had state gross  receipts tax
       credit carryforwards of approximately $106,000 and $89,000, respectively,
       which are available to reduce future state income taxes payable,  if any,
       through 2003.

       Prior to January 1, 1996,  the Company was  permitted  under the Internal
       Revenue  Code (the  "Code")  a  special  bad debt  deduction  related  to
       additions  to tax  bad  debt  reserves  established  for the  purpose  of
       absorbing  losses.  The  provisions of the Code  permitted the Company to
       deduct  from  taxable  income an  allowance  for bad  debts  based on the
       greater of a percentage of taxable income before such deduction or actual
       loss  experience.   Retained   earnings  at  December  31,  1999  include
       approximately $675,000 for which no deferred Federal income tax liability
       has been  recognized.  The amounts  represent an allocation of income for
       bad debt deductions for tax purposes only. Reduction of amounts allocated
       for purposes other than tax bad debt losses or  adjustments  arising from
       carryback of net  operating  losses would create  income for tax purposes
       only,  which would be subject to the then  current  corporate  income tax
       rate.

(7)    Commitments
       The Company is a party to financial  instruments with  off-balance  sheet
       risk in the normal course of business to meet the financing  needs of its
       customers.  These financial instruments include standby letters of credit
       and commitments to extend credit.  These instruments  involve, to varying
       degrees,  elements  of  credit  and  interest  rate risk in excess of the
       amount recognized in the consolidated financial statements.  The contract
       or  notional  amounts  of  those   instruments   reflect  the  extent  of
       involvement   the  Company  has  in   particular   classes  of  financial
       instruments.

       Standby  letters  of credit  are  conditional  commitments  issued by the
       Company  guaranteeing  the  performance  of a customer to a third  party.
       These  guarantees  are  primarily  issued to support  public and  private
       borrowing  arrangements.  The credit risk involved in issuing  letters of
       credit  is  essentially  the  same as that  involved  in  extending  loan
       facilities to customers.  The Company holds  collateral  supporting these
       commitments, as deemed necessary.

       The Company's  exposure to credit loss, in the event of nonperformance by
       the  customer for  commitments  to extend  credit and standby  letters of
       credit is  represented  by the  contractual  or notional  amount of those
       instruments.  The  Company  uses  the  same  credit  policies  in  making
       commitments and conditional obligations as it does for recorded loans.

       The following summarizes commitments as of December 31, 1999 and 1998:

                                                           Approximate
                                                         Contract Amount
                                                         ---------------
                                                        1999          1998
                                                        ----          ----
          Financial instruments whose contract
              amounts represent credit risk:
                  Commitments to extend credit   $    33,894,000    22,209,000
                  Standby letters of credit      $       552,000       195,000

       Commitments to extend credit are agreements to lend to a customer as long
       as there is no violation of any condition  established  in the agreement.
       Commitments  generally have fixed expiration  dates or other  termination
       clauses and may require  payment of a fee. Since some of the  commitments
       are expected to expire  without  being drawn upon,  the total  commitment
       amounts  do not  necessarily  represent  future  cash  requirements.  The
       Company  evaluates  each  customer's  creditworthiness  on a case-by-case
       basis.  The amount of  collateral  obtained,  if deemed  necessary by the
       Company  upon  extension  of  credit,  is  based on  management's  credit
       evaluation of the borrower.

       The Company has entered into contracts with certain members of management
       which  stipulate a term and annual base  salary.  The  contract  includes
       provisions  to terminate  the agreement for "just cause" which is defined
       in the  contracts.  If such members of  management  are relieved of their
       position  without just cause,  the employee is entitled to a continuation
       of salary from the  termination  date through the  remaining  term of the
       agreement.  Certain of these  employment  agreements  contain a provision
       stating that in the event of  involuntary  termination  of  employment in
       connection  with or within one year  after,  any change in control of the
       Company,  the officer will be paid a lump sum distribution  equal to 2.99
       times the individual's base compensation.

                                       25
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(8)    Federal Home Loan Bank Advances and Line of Credit
       At December 31, 1999 the Bank had advances  outstanding  from the Federal
       Home Loan Bank (FHLB) of Atlanta  amounting to  $13,100,000  secured by a
       blanket  lien on  residential  mortgage  loans.  Principal  is payable at
       maturity  and interest is due monthly  based on interest  rates as stated
       below at December 31, 1999.

                 Advances       Interest Rate          Maturity
                 --------       -------------          --------
           $    5,000,000            5.98%           January 2000
           $    5,000,000            5.96%             March 2000
           $    3,100,000            4.55%            August 2000

       Additionally,  during 1999 the Company entered into a line of credit with
       a  financial  institution  totaling  $2,500,000  of  which  $900,000  was
       outstanding as of December 31, 1999.  The line accrues  interest at prime
       minus 50 basis points and matures  September  30,  2001.  The facility is
       collateralized by the stock of the Bank.

(9)    Preferred Stock
       The  Company  is  authorized  to issue  1,000,000  shares of no par value
       preferred  stock.  At December 31, 1999,  there were no shares issued and
       outstanding. The Board of Directors of the Company is authorized to issue
       preferred  stock  and to  fix  and  state  voting  powers,  designations,
       preferences,   or  other   special   rights  of  such   shares   and  the
       qualifications,   limitations,   and  restrictions  thereof,  subject  to
       regulatory approval but without stockholder approval.

(10)   Employee Benefit Plans
       (a)  401(k) Profit Sharing Plan
            --------------------------
           The Company has a tax-qualified  defined  contribution profit sharing
           plan (the  "Plan") for the benefit of its  employees.  All  full-time
           employees  become  eligible  to  participate  under  the  Plan  after
           completing  one  year of  service.  Under  the  Plan,  employees  may
           voluntarily  elect to defer up to 15% of their  compensation,  not to
           exceed applicable limits.  Company  contributions were $1.00 for each
           $1.00  of  employee   contribution   up  to  5%  of  the   employee's
           compensation.  Such matching  contributions begin to vest after three
           years at a rate of 20% per year with full vesting  after seven years.
           Additionally,  the Company  may  contribute  an annual  discretionary
           contribution to the Plan based upon a number of factors,  such as the
           Company's  retained  earnings,   profits,   regulatory  capital,  and
           employee performance.

           Contributions  by the  Company  to the Plan  during  the years  ended
           December 31, 1999 and 1998 totaled approximately $59,000 and $68,000,
           respectively.

       (b) Employee Stock Ownership Plan
           -----------------------------
           The Company also has an employee  stock  ownership  plan (the "ESOP")
           for  the  exclusive  benefit  of  participating  employees  who  have
           completed  one year of service with the Company and have attained age
           21.

           The ESOP is funded by periodic  contributions  made by the Company in
           cash or common stock.  Benefits to participants may be paid either in
           shares  of the  Company's  common  stock  or in  cash.  The  ESOP was
           approved to borrow funds from the Company to acquire up to 10% of the
           common stock of the Company.  During 1995, the ESOP borrowed $720,000
           from the Company to acquire  87,120 shares of Company common stock at
           approximately  $8 per  share.  The  loan  is  secured  by the  shares
           purchased and earnings of the ESOP assets, and is at an interest rate
           equal to a published prime rate, adjusted  quarterly.  The loan is to
           be paid over a  ten-year  period at  $72,000  per  year.  The  shares
           purchased  are  held  in a  suspense  account  for  allocation  among
           participants as the loan is repaid.

           At December  31,  1999,  39,006 ESOP  shares  were  allocated  to the
           participating  employees.  For purposes of computing net earnings per
           share,  the remaining 48,114  unallocated  shares were not considered
           outstanding until they are  committed-to-be-released  for allocation.
           The Company  recognized the fair market value of the Company's common
           stock allocated to participating  employees as compensation  expense.
           Compensation expense recognized by the Company during the years ended
           December   31,  1999  and  1998   totaled   $142,148,   and  $166,878
           respectively.  The fair value of the  unallocated  shares at December
           31, 1999 was approximately $698,000.

                                       26
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(10)   Employee Benefit Plans, continued

       (c) Stock Option Plan
           -----------------
           In  January  1996,  the  Company  approved a stock  option  plan (the
           "Option Plan")  whereby  144,020  authorized  shares are reserved for
           issuance by the Company  upon  exercise of stock  options  granted to
           officers,  directors, and employees of the Company from time to time.
           Options  constitute  both  incentive  stock options and non qualified
           stock  options.   Options  awarded  to  officers  and  directors  are
           exercisable at a rate of 20% annually with the first 20%  exercisable
           on the one-year  anniversary of the date of grant. Any shares subject
           to an award which expires or are terminated unexercised will again be
           available  for  issuance.  The  Option  Plan has a term of ten years,
           unless  sooner   terminated.   The  exercise   price  per  share  for
           nonqualified  and  incentive  stock  options  shall  be the  price as
           determined by an option committee,  but not less than the fair market
           value of the common stock on the date of grant. At December 31, 1999,
           there were 23,176 shares available under the Option Plan.

           Stock option activity is as follows:

                                                     1999       1998
                                                     ----       ----

Options outstanding at beginning of period         117,819    116,558
Options granted                                     10,000      9,900
Options canceled                                   (14,175)    (8,639)
                                                   -------    -------
Options outstanding at end of period               113,644    117,819
                                                   =======    =======
Options exercisable at end of period                58,227     44,953
                                                   =======    =======
Weighted-average option prices per share:
     Options granted during the period        $      16.52      18.40
     Options canceled during the period       $      12.99      10.13
     Options outstanding at end of period     $      11.56      11.03

           The options  outstanding at December 31, 1999 had a  weighted-average
           contractual  maturity of 7.2 years and exercise  prices  ranging from
           $10.01 to $19.82.

           The  Company is  encouraged,  but not  required,  to compute the fair
           value of options at the date of grant and to recognize  such costs as
           compensation  expense  immediately if there is no vesting period,  or
           ratably  over the  vesting  period of the  options.  The  Company has
           chosen not to adopt these cost  recognition  principles  and accounts
           for all options under Accounting  Principles Board Opinion No. 25 and
           its  related  interpretations.   No  compensation  expense  has  been
           recognized  related to the Option Plan.  Had  compensation  cost been
           determined  based  upon the fair  value of the  options  at the grant
           dates,  the  Company's  net earnings and net earnings per share would
           have been reduced to the proforma amounts indicated below:

                                                         1999        1998
                                                         ----        ----
Net earnings                     As reported   $      1,002,891     618,776
                                 Proforma      $        939,711     554,730

Basic earnings per share         As reported   $           1.09        0.67
                                 Proforma      $           1.02        0.60

Diluted earnings per share       As reported   $           1.04        0.64
                                 Proforma      $            .98        0.57

            The  weighted  average  fair value of options  granted was $3.20 and
            $1.10 for the years ended December 31, 1999 and 1998,  respectively,
            based on estimates  as of the date of grant using the Black  Scholes
            pricing model. The weighted  average  assumptions used for grants in
            1999 and 1998 were as follows:  dividend  yield of 2.0% and 4.6%,  a
            risk free interest rate of 5.2% and 4.7%, expected volatility of 21%
            and 20%,  respectively,  and an  expected  life of 7 years  for both
            years.
                                       27
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(10)   Employee Benefit Plans, continued
       (d) Management Stock Bonus Plan
           ---------------------------
           In January 1996,  the Company  adopted a Management  Stock Bonus Plan
           (the  "MSBP").  Under the terms of the MSBP, a total of 57,608 shares
           of the Company's common stock is available for the granting of awards
           during a period of up to ten years.  In connection  with the adoption
           of the MSBP, the Company purchased treasury shares in the open market
           at a total cost of $578,464 to cover the total shares  available  for
           grant under the MSBP.  Through December 31, 1999, the Company awarded
           45,085 of such treasury shares to employees.  The market value of the
           common  stock  at the date of award is  included  as a  reduction  of
           stockholders'  equity  in  the  consolidated  balance  sheets  and is
           recorded as compensation  expense using the straight-line method over
           the vesting period of the awards.  The awards vest pro rata over five
           years at each  anniversary  of the award.  Compensation  expense with
           respect to the foregoing  MSBP awards was $78,629 and $98,659 for the
           years ended December 31, 1999 and 1998 respectively.

       (e) Life Insurance Policies
           -----------------------
           During  1999,  the  Company  adopted  a  defined   contribution  post
           retirement benefit plan to provide retirement  benefits to certain of
           the Company's  executive  officers and to provide death  benefits for
           the  designated  beneficiaries.   Under  this  plan,  single-premium,
           split-dollar,   whole-life  insurance  contracts  were  purchased  on
           certain executive officers.  The increase in the cash surrender value
           of the  contracts,  less the Bank's  cost of funds,  constitutes  the
           Company's  contribution  to the plan  each  year.  In the  event  the
           insurance contracts fail to produce positive returns, the Company has
           no obligations to contribute to the plan. For the year ended December
           31, 1999, the Company incurred  expenses of $5,660 in connection with
           this plan.

(11)   Fair Values of Financial Instruments
       SFAS No. 107,  "Disclosure  About Fair Value of  Financial  Instruments,"
       requires   disclosure   of  fair  value   information   about   financial
       instruments, whether or not recognized in the balance sheet, for which it
       is  practicable  to estimate  that value.  In cases where  quoted  market
       prices  are not  available,  fair  values  are based on  estimates  using
       present  value  or  other  valuation  techniques.  Those  techniques  are
       significantly  affected by the assumptions  used,  including the discount
       rate and estimates of future cash flows. In that regard, the derived fair
       value  estimates  cannot be  substantiated  by comparison to  independent
       markets and, in many cases, could not be realized in immediate settlement
       of the  instrument.  These estimates are subjective in nature and involve
       uncertainties and matters of significant judgment and, therefore,  cannot
       be determined with precision.  Changes in assumptions would significantly
       affect the estimates.

       Fair value  estimates  are based on  existing  on- and  off-balance-sheet
       financial  instruments and other recorded assets and liabilities  without
       attempting to estimate the fair value of anticipated future business.  In
       addition,  tax  ramifications  related to the  realization  of unrealized
       gains and losses can have a  significant  effect on fair value  estimates
       and have not been  considered in any of the estimates.  Accordingly,  the
       aggregate  fair value amounts  presented do not represent the  underlying
       value of the Company.

       The  following  methods  and  assumptions  were  used by the  Company  in
       estimating  its fair value  disclosures  for  financial  instruments  and
       certain other assets and liabilities:

          Cash and cash equivalents
          -------------------------
          The carrying  amounts of cash and cash  equivalents  approximate  fair
          values.

          Investment securities available for sale
          ----------------------------------------
          Fair values for investment  securities available for sale are based on
          quoted market prices.

          Federal Home Loan Bank stock
          ----------------------------
          The carrying amount is considered a reasonable estimate of fair value.

          Loans
          -----
          For   variable-rate   loans  that  reprice   frequently  and  with  no
          significant  change in credit risk,  fair values are based on carrying
          values. The fair values for all other loans are estimated based upon a
          discounted  cash flow analysis,  using interest rates  currently being
          offered for loans with similar  terms to  borrowers of similar  credit
          quality.



          Cash surrender value of life insurance policies.
          ------------------------------------------------
          Fair value for life insurance  cash  surrender  value is based on cash
          surrender values indicated by the insurance companies.

                                       28
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(11)   Fair Values of Financial Instruments, continued
          Deposits
          --------
          Fair  values  for  fixed-rate  time  deposits  are  estimated  using a
          discounted  cash flow analysis that applies  interest rates  currently
          being offered on deposits of similar  terms of maturity.  The carrying
          amounts  of all  other  deposits,  due  to  their  short-term  nature,
          approximate their fair values.

          Securities sold under agreements to repurchase
          ----------------------------------------------
          Fair value  approximates the carrying value of such liabilities due to
          their short-term nature

          Federal Home Loan Bank advances
          -------------------------------
          The  carrying   amounts  of  the  Federal  Home  Loan  Bank   advances
          approximate  their fair values as the advances are based on a floating
          interest rate or represent short term maturities.

          Line of credit
          --------------
          Advances on the line of credit bear interest on a floating basis,  and
          as such, the carrying amount approximates fair value.

          Off-balance-sheet instruments
          -----------------------------
          Fair values for the Company's off-balance-sheet  instruments are based
          on a comparison  with terms,  including  interest rate and  commitment
          period currently  prevailing to enter into similar agreements,  taking
          into account credit standings. Because these instruments are primarily
          variable rate instruments, the contract value is a reasonable estimate
          of fair value.

       The estimated  fair value of the Company's  financial  instruments  as of
       December 31, 1999 and December 31, 1998 are as follows:
<TABLE>
<CAPTION>
                                                                   December 31, 1999       December 31, 1998
                                                                   -----------------       -----------------
                                                                Carrying        Fair       Carrying      Fair
                                                                  Value         Value       Value        Value
                                                                  -----         -----       -----        -----
                                                                                (in thousands)
<S>                                                        <C>                <C>          <C>         <C>
         Assets:
            Cash and cash equivalents                        $     11,332       11,332       10,353      10,353
            Investment securities available for sale         $     28,503       28,503       29,457      29,457
            Loans, net                                       $    146,553      149,502      121,827     125,517
            Federal Home Loan Bank stock                     $        655          655        1,013       1,013
            Cash surrender value of life insurance policies  $      1,337        1,337            -           -

         Liabilities:
            Deposits                                         $    165,526      165,614      154,977     157,987
            Securities sold under agreements to repurchase   $      3,998        3,998        1,117       1,117
            Federal Home Loan Bank advances                  $     13,100       13,100            -           -
            Line of credit                                   $        900          900            -           -

            Off-balance sheet financial instruments:
            Commitments to extend credit                     $     33,894       33,894       22,209      22,209
            Standby letters of credit                        $        552          552          195         195
</TABLE>

(12)   Related Party Transactions
       Loans  are made to  officers,  directors,  and  their  associates  in the
       ordinary  course of  business  on  substantially  the same terms as those
       prevailing at the time for comparable transactions with other persons and
       do not involve  more than the normal  credit  risk.  The  following  is a
       summary of activity  during the year ended December 31, 1999 with respect
       to such aggregate loans to these individuals and their associates:

Related party loan balances at beginning of year           $    2,042,753
New loans                                                         959,344
Principal repayments                                             (889,102)
                                                                ---------
Related party loan balances at end of year                 $    2,112,995
                                                                =========




       Deposits  from  related  parties  totaled  approximately  $1,752,000  and
       $1,005,000,at December 31, 1999 and 1998, respectively.

                                       29
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(13)   Parent Company Financial Information
       The following represents condensed financial information of the Parent.

                            Condensed Balance Sheets
                           December 31, 1999 and 1998

                                     Assets
                                     ------
<TABLE>
<CAPTION>
                                                                                               1999            1998
                                                                                               ----            ----

<S>                                                                                    <C>               <C>
Cash                                                                                    $      183,699         294,503
Investment in subsidiary                                                                    12,828,276      11,480,697
Investment securities available for sale                                                             -         134,000
Other assets                                                                                   106,385          10,000
                                                                                            ----------      ----------
                                                                                        $   13,118,360      11,919,200
                                                                                            ==========      ==========
                      Liabilities and Stockholders' Equity
                      ------------------------------------

Dividends payable                                                                       $       73,334         135,541
Line of credit                                                                                 900,000               -
Other liabilities                                                                              162,684         157,546
                                                                                            ----------      ----------
                                                                                             1,136,018         293,087

Stockholders' equity                                                                        11,982,342      11,626,113
                                                                                            ----------      ----------
                                                                                        $   13,118,360      11,919,200
                                                                                            ==========      ==========
</TABLE>

                        Condensed Statements of Earnings

                 For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
                                                                                               1999            1998
                                                                                               ----            ----

<S>                                                                                    <C>                  <C>
Dividends from subsidiary                                                               $       50,000               -
Interest income from subsidiary                                                                  5,909          26,196
Gain on sale of investment securities                                                           68,201         386,187
Other operating income                                                                               -           9,386
Other operating expenses                                                                      (299,144)        (64,635)
Income tax (expense) benefit                                                                    78,500        (125,134)
                                                                                            ----------      ----------
Earnings (loss) before equity in
     undistributed earnings of subsidiary                                                      (96,534)        232,000

Equity in undistributed earnings of subsidiary                                               1,099,425         386,776
                                                                                             ---------         -------
Net earnings                                                                            $    1,002,891         618,776
                                                                                             =========         =======
</TABLE>
                                       30
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(13)     Parent Company Financial Information, continued


                       Condensed Statements of Cash Flows

                 For the Years Ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
                                                                                                1999            1998
                                                                                                ----            ----
<S>                                                                                     <C>               <C>
Cash flows from operating activities:
      Net earnings                                                                       $    1,002,891        618,776
      Adjustment to reconcile net earnings
         to net cash used in operating activities:
            Equity in undistributed earnings of subsidiary                                   (1,099,425)      (386,776)
            Compensation expense related to MSBP                                                 78,629         98,659
            ESOP shares allocated                                                               142,148        166,878
            Gain on sale of investment security                                                 (68,201)      (386,187)
            (Increase) decrease in other assets                                                 (72,049)        19,284
            Decrease (increase) in other liabilities                                              5,138       (311,634)
                                                                                         --------------     ----------
                     Net cash used in operating activities                                      (10,869)      (181,000)
                                                                                         --------------     ----------

Cash flows from investing activities:
      Proceeds from sale of investment security                                                 132,656      1,565,203
      Capital infusion in subsidiary                                                           (750,000)      (750,000)
                                                                                         --------------     ----------
                     Net cash (used in) provided by investing activities                       (617,344)       815,203
                                                                                         --------------     ----------

Cash flows from financing activities:
      Dividends paid                                                                           (351,897)      (626,925)
      Treasury stock purchased                                                                        -        (60,345)
      Retirement of common stock                                                                (30,694)             -
      Proceeds from notes payable                                                               900,000              -
                                                                                         --------------     ----------

                     Net cash provided by (used in) financing activities                        517,409       (687,270)
                                                                                         --------------     ----------
Change in cash and cash equivalents                                                            (110,804)       (53,067)

Cash and cash equivalents at beginning of period                                                294,503        347,570
                                                                                         --------------     ----------
Cash and cash equivalents at end of period                                               $      183,699        294,503
                                                                                         ==============     ==========
</TABLE>

                                       31
<PAGE>
                       CCF HOLDING COMPANY AND SUBSIDIARY
              Notes to Consolidated Financial Statements, continued

(14)   Regulatory Matters
       Dividends paid by the Bank are the primary  source of funds  available to
       the Company.  Banking  regulations limit the amount of dividends that may
       be paid  without  prior  approval of the  regulatory  authorities.  These
       restrictions are based on the level of regulatory  classified assets, the
       prior  years'  net  earnings,  and the ratio of equity  capital  to total
       assets. At December 31, 1999, the Bank could pay  approximately  $550,000
       in dividends without obtaining prior regulatory approval.

       The  Company  and the Bank are  subject  to  various  regulatory  capital
       requirements  administered  by the federal banking  agencies.  Failure to
       meet minimum  capital  requirements  can initiate  certain  mandatory and
       possibly  additional   discretionary   actions  by  regulators  that,  if
       undertaken,  could have a direct material effect on the Bank's  financial
       statements.   Under  capital  adequacy   guidelines  and  the  regulatory
       framework  for  prompt  corrective  action,  the Bank must meet  specific
       capital  guidelines  that  involve  quantitative  measures  of the Bank's
       assets,  liabilities,  and certain  off-balance-sheet items as calculated
       under  regulatory  accounting  practices.  The Bank's capital amounts and
       classification   are  also  subject  to  qualitative   judgments  by  the
       regulators about components, risk weightings, and other factors.

       Quantitative   measures  established  by  regulation  to  ensure  capital
       adequacy require the Company and the Bank to maintain minimum amounts and
       ratios of total and Tier I capital to risk-weighted assets, and of Tier I
       capital to average assets.  Management believes, as of December 31, 1999,
       that the Company and the Bank meet all capital  adequacy  requirements to
       which they are subject.

       As of December 31, 1999,  the most recent  notification  from the Federal
       Deposit  Insurance  Corporation  categorized the Bank as well capitalized
       under the  regulatory  framework  for  prompt  corrective  action.  To be
       categorized  as well  capitalized,  the Bank must maintain  minimum total
       risk-based, Tier I risk-based, and Tier I leverage ratios as set forth in
       the  table  below.   There  are  no   conditions  or  events  since  that
       notification  that  management  believes have changed the Bank's  capital
       category.

       The  consolidated  and Bank only  actual  capital  amounts  and ratios at
       December 31, 1999 are presented in the table below. At December 31, 1998,
       consolidated  amounts did not materially  differ from  Bank-only  capital
       amounts and ratios.
<TABLE>
<CAPTION>
                                                                                                         To Be Well
                                                                                                      Capitalized Under
                                                                              For Capital             Prompt Corrective
                                                                           Adequacy Purposes          Action Provisions
                                                                     -------------------------- ----------------------------
                                                       Actual
                                          -------------------------- -------------------------- ----------------------------
                                              Amount        Ratio        Amount        Ratio        Amount         Ratio
                                              ------        -----        ------        -----        ------         -----
<S>                                   <C>                   <C>          <C>          <C>         <C>             <C>
         As of December 31, 1999:
         Total capital - risk-based
            (to risk-weighted assets)
            Bank                       $      14,574,000    10%           11,998,000    =>8%        14,997,000      =>10%
            Consolidated               $      13,728,000     9%           11,998,000    =>8%         N/A           N/A
         Tier I capital - risk-based
            (to risk-weighted assets)
            Bank                       $      13,336,812     9%            5,999,000    =>4%         8,998,000      => 6%
            Consolidated               $      12,490,878     8%            5,999,000    =>4%         N/A           N/A
         Tier I capital - leverage
            (to average assets)
            Bank                       $      13,336,812     7%            7,819,000    =>4%         9,774,000      => 5%
            Consolidated               $      12,490,878     6%            7,819,000    =>4%         N/A           N/A

         As of December 31, 1998:
         Total capital - risk-based
            (to risk-weighted assets)  $      12,431,000    11%            9,370,000    =>8%        11,713,000      =>10%
         Tier I capital - risk-based
            (to risk-weighted assets)  $      11,487,000    10%            4,685,000    =>4%         7,028,000      => 6%
         Tier I capital - leverage
            (to average assets)        $      11,487,000     8%            6,106,000    =>4%         7,633,000      => 5%
</TABLE>
                                       32
<PAGE>
                                         CCF HOLDING COMPANY
                                         101 N. Main Street
                                      Jonesboro, Georgia 30236
                                           (770) 478-8881
<TABLE>
<CAPTION>
                                            HERITAGE BANK
<S>                       <C>                     <C>                           <C>                        <C>
    Main Office            Forest Park Office      Morrow Office                 McDonough Office           Fayetteville Office
    101 N. Main Street     822 Main Street         2236 Lake Harbin Road         203 Keys Ferry Street      440 N. Jeff Davis Drive
    Jonesboro, Georgia     Forest Park, Georgia    Morrow, Georgia               McDonough, Georgia         Fayetteville, Georgia
</TABLE>
                              Board of Directors of CCF Holding Company
                                                 and
                                            Heritage Bank
<TABLE>
<CAPTION>
          <S>                                           <C>
            John B. Lee, Jr.                              Edwin S. Kemp, Jr.
            Chairman of the Board                         Attorney at Law
            Public Relations Consultant to Spartan
            Lincoln-Mercury, Inc

            Joe B. Mundy                                  David B. Turner
            Retired (Former circuit court clerk)          President and Chief Executive Officer

            Leonard A. Moreland                           Charles S. Tucker
            Executive Vice President                      Retired  (former county agent for University of Georgia)
            Administrative Officer

            Roy Hall*                                     John T. Mitchell
            Certified Public Accountant                   Real Estae Developer
                                                          Adams Mitchell Realty
</TABLE>
                                                  ------------------------------
*Director of Bank only
<TABLE>
<CAPTION>
                                      Executive Officers of CCF Holding Company and
                                                      Heritage Bank
<S>                                                                        <C>
                      David B. Turner                                                         Leonard A. Moreland
             President and Chief Executive Officer                                         Executive Vice President

                      Mary Jo Rogers                                                           Edith W. Stevens
        Sr. Vice President and Chief Financial Officer                          Sr. Vice President and Chief Operating Officer

                       Richard P. Florin                                                       Charles S. Tucker
      Senior Vice President and Senior Credit Officer                                       Secretary and Treasurer

                      C. T.  Segers*                                                           John C. Bowdoin*
                   Senior Vice President                                                     Senior Vice President
                                                  --------------------------------
                   Independent Auditors                                                      Corporate Counsel
                   Porter Keadle Moore, LLP                                                  Edwin S. Kemp, Jr., Esquire
                   235 Peachtree Street, N.W.                                                101 North Main Street
                   Suite 1800                                                                Suite 203
                   Atlanta, GA 30303                                                         Jonesboro, Georgia 30236

                   Transfer Agent and Registrar                                              Special Counsel
                   Registrar & Transfer Company                                              Malizia Spidi & Fisch, PC
                   10 Commerce Drive                                                         One Franklin Square
                   Cranford, New Jersey 07016                                                1301 K Street, N.W., Suite 700 East
                   (908) 272-8511                                                            Washington, D.C. 20005
</TABLE>

                        --------------------------------
*Officer of Heritage Bank only

The Company's  Annual Report for the year ended December 31, 1999 on Form 10-KSB
is available without charge upon written request.  For a copy of the Form 10-KSB
or any  other  investor  information,  please  write or call  David  B.  Turner,
President  and Chief  Executive  Officer at the  Company's  Office in Jonesboro,
Georgia.  The Annual Meeting of  Stockholders  will be held on April 26, 2000 at
9:30 p.m. at the Fayetteville office.

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