----

**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**FORM      10-QSB**

**[X]  QUARTERLY      REPORT UNDER SECTION 13 OR 15(d)**

**OF      THE SECURITIES EXCHANGE ACT OF 1934**

**[   ]  TRANSITION      REPORT UNDER SECTION 13 OR 15(d)**

**OF      THE EXCHANGE ACT**

| Oconee                Financial Corporation                                          |
|--------------------------------------------------------------------------------------|
| (Exact                name of registrant as specified in its                charter) |

| Georgia                                                                 |   | 58-2442250                                                        |
|-------------------------------------------------------------------------|--------|-------------------------------------------------------------------|
| (State                of Incorporation)                                 |   | (I.R.S.                EmployerIdentification                No.) |
|                                                                    |   |                                                              |
|                                                                    |   |                                                              |
| 35                North Main StreetWatkinsville,                Georgia |   |  30677                                                       |
| (Address                of principalexecutive                offices)   |   | (Zip                Code)                                         |

----

Index

**OCONEE      FINANCIAL CORPORATION AND SUBSIDIARY**

**INDEX**

|                            |                                                                                                                  | Page                No. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------|-------------------------|
| PART                I                                                                                                                                        | FINANCIAL                INFORMATION                                                                                  |                    |
|                                                                                                                                                         |                                                                                                                  |                    |
| Item                1.                                                                                                                             | Financial                Statements                                                                                   |                    |
|                                                                                                                                                         |                                                                                                                  |                    |
|                                                                                                                                                         | Consolidated                Balance Sheet (unaudited) at September 30,                2005                            | 3                       |
|                                                                                                                                                         |                                                                                                                  |                    |
|                                                                                                                                                         | Consolidated                Statements of Earnings (unaudited) for the Three                Months Ended and the Nine |                    |
|                                                                                                                                                         | Months                Ended September 30, 2005 and 2004                                                               | 4                       |
|                                                                                                                                                         |                                                                                                                  |                    |
|                                                                                                                                                         | Consolidated                Statements of Comprehensive Income                (unaudited) for the Three Months and    |                    |
|                                                                                                                                                         | the                Nine Months Ended September 30, 2005 and                2004                                       | 5                       |
|                                                                                                                                                         |                                                                                                                  |                    |
|                                                                                                                                                         | Consolidated                Statements of Cash Flows (unaudited) for                the Nine Months                   |                    |
|                                                                                                                                                         | Ended                September 30, 2005 and 2004                                                                      | 6-7                     |
|                                                                                                                                                         |                                                                                                                  |                    |
|                                                                                                                                                         | Notes                to Financial Statements                (unaudited)                                               | 8-9                     |
|                                                                                                                                                         |                                                                                                                  |                    |
| Item                2.                                                                                                                             | Management's                Discussion and Analysis or Plan of Operation                                              | 10-13                   |
|                                                                                                                                                         |                                                                                                                  |                    |
| Item                3.                                                                                                                             | Controls                and Procedures                                                                                | 14                      |
|                                                                                                                                                         |                                                                                                                  |                    |
| PART                II                                                                                                                                       | OTHER                INFORMATION                                                                                      |                    |
|                                                                                                                                                         |                                                                                                                  |                    |
| Item                1.                                                                                                                             | Legal                Proceedings                                                                                      | 15                      |
|                                                                                                                                                         |                                                                                                                  |                    |
| Item                2.                                                                                                                             | Unregistered                Sales of Equity Securities and Use of                Proceeds                             | 15                      |
|                                                                                                                                                         |                                                                                                                  |                    |
| Item                3.                                                                                                                             | Defaults                Upon Senior Securities                                                                        | 15                      |
|                                                                                                                                                         |                                                                                                                  |                    |
| Item                4.                                                                                                                             | Submission                of Matters to a Vote of Security                Holders                                     | 15                      |
|                                                                                                                                                         |                                                                                                                  |                    |
| Item                5.                                                                                                                             | Other                Information                                                                                      | 15                      |
|                                                                                                                                                         |                                                                                                                  |                    |
| Item                6.                                                                                                                             | Exhibits                                                                                                              | 15                      |
|                                                                                                                                                         |                                                                                                                  |                    |

----

Index

**PART      I.  FINANCIAL INFORMATION**

Financial 

**OCONEE      FINANCIAL CORPORATION AND SUBSIDIARY**

Balance 

| Assets                                                                                                                                                                            |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                              |   |   |   |
| Cash                and due from banks, including reserve requirements of                $3,453,000                                                                               |   | $ | 7,131,318 |   |
| Federal                funds sold                                                                                                                                                 |   |   | 19,827,000 |   |
|                                                                                                                                                                              |   |   |   |   |
|                             Cash and cash equivalents                                                                 |   |   | 26,958,318 |   |
|                                                                                                                                                                              |   |   |   |   |
| Investment                securities available for sale                                                                                                                           |   |   | 50,354,303 |   |
| Other                investments                                                                                                                                                  |   |   | 614,429 |   |
| Mortgage                loans held for sale                                                                                                                                       |   |   | 2,271,510 |   |
|                                                                                                                                                                              |   |   |   |   |
| Loans                                                                                                                                                                             |   |   | 188,852,407 |   |
| Less:                Allowance for loan losses                                                                                                                                    |   |   | (2,966,139 | ) |
|                                                                                                                                                                              |   |   |   |   |
|                    Loans,                net                                       |   |   | 185,886,268 |   |
|                                                                                                                                                                              |   |   |   |   |
| Premises                and equipment, net                                                                                                                                        |   |   | 5,862,710 |   |
| Accrued                interest receivable and other assets                                                                                                                       |   |   | 3,169,785 |   |
|                                                                                                                                                                              |   |   |   |   |
|                    Total                assets                                     |   | $ | 275,117,323 |   |
|                                                                                                                                                                              |   |   |  |   |
| Liabilities                and Stockholders’ Equity                                                                                                                         |
|                                                                                                                                                                              |   |   |  |   |
| Liabilities:                                                                                                                                                                      |   |   |  |   |
|        Deposits                                                                                                                                |   |   |  |   |
|             Noninterest-bearing                                                                                       |   | $ | 34,185,040 |   |
|             Interest-bearing                                                                                          |   |   | 213,150,825 |   |
|                                                                                                                                                                              |   |   |   |   |
|                    Total                deposits                                   |   |   | 247,335,865 |   |
|                                                                                                                                                                              |   |   |   |   |
|        Securities                sold under repurchase agreements                                                                              |   |   | 2,844,262 |   |
|        Accrued                interest payable and other liabilities                                                                           |   |   | 886,963 |   |
|                                                                                                                                                                              |   |   |   |   |
|                    Total                liabilities                                |   |   | 251,067,090 |   |
|                                                                                                                                                                              |   |   |   |   |
| Stockholders’                equity:                                                                                                                                        |   |   |   |   |
|        Common                stock, $2 par value;                                                                                              |   |   |   |   |
|              authorized                1,500,000 shares;                                                         |   |   |   |   |
|              issued                and outstanding 899,815 shares                                                |   |   | 1,799,630 |   |
|        Additional                paid-in capital                                                                                               |   |   | 4,243,332 |   |
|        Retained                earnings                                                                                                        |   |   | 17,803,380 |   |
|        Accumulated                other comprehensive income                                                                                   |   |   | 203,891 |   |
|                                                                                                                                                                              |   |   |   |   |
|                    Total                stockholders’ equity                 |   |   | 24,050,233 |   |
|                                                                                                                                                                              |   |   |  |   |
|                    Total                liabilities and stockholders’ equity |   | $ | 275,117,323 |   |

----

Index

**OCONEE      FINANCIAL CORPORATION AND SUBSIDIARY**

Statements 

|                                                                                                                                                                                 |   |  **Three                Months Ended** |      |  **Nine                Months Ended** |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------|-----------|--------------------------------------------|--------|
|                                                                                                                                                                                 |   | **2005**                                    |      | **2004**                                   |   | **2005** |   | **2004** |   |
| Interest                Income:                                                                                                                                                      |   |                                        |      |                                       |   |   |   |   |  |   |   |  |   |
|                     Loans                                                                                                                                        |   | $                                           | 3,455,648 |                                       |   | 2,842,313 |   |   | 9,966,736 |   |   | 8,481,583 |   |
|                     Investment securities:                                                                                                                       |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
|                          Tax exempt                                                                                                     |   |                                        | 207,137   |                                       |   | 198,674 |   |   | 592,412 |   |   | 608,240 |   |
|                          Taxable                                                                                                        |   |                                        | 346,068   |                                       |   | 302,947 |   |   | 898,351 |   |   | 958,082 |   |
|                     Federal funds sold and other                                                                                                                 |   |                                        | 63,393    |                                       |   | 20,134 |   |   | 228,775 |   |   | 71,055 |   |
|                             Total interest income                                                                        |   |                                        | 4,072,246 |                                       |   | 3,364,068 |   |   | 11,686,274 |   |   | 10,118,960 |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
| Interest                Expense:                                                                                                                                                     |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
|                     Deposits                                                                                                                                     |   |                                        | 1,332,583 |                                       |   | 825,854 |   |   | 3,598,797 |   |   | 2,665,554 |   |
|                     Other                                                                                                                                        |   |                                        | 12,724    |                                       |   | 7,005 |   |   | 31,873 |   |   | 16,222 |   |
|                             Total interest expense                                                                       |   |                                        | 1,345,307 |                                       |   | 832,859 |   |   | 3,630,670 |   |   | 2,681,776 |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
|                             Net interest income                                                                          |   |                                        | 2,726,939 |                                       |   | 2,531,209 |   |   | 8,055,604 |   |   | 7,437,184 |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
| Provision                for loan losses                                                                                                                                             |   |                                        | 204,000   |                                       |   | 94,000 |   |   | 612,000 |   |   | 274,000 |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
|                    Net                interest income after provision for loan losses |   |                                        | 2,522,939 |                                       |   | 2,437,209 |   |   | 7,443,604 |   |   | 7,163,184 |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
| Other                Income:                                                                                                                                                         |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
| Service                charges on deposit accounts                                                                                                                                   |   |                                        | 418,792   |                                       |   | 271,966 |   |   | 1,187,786 |   |   | 775,095 |   |
| Mortgage                banking income                                                                                                                                               |   |                                        | 124,303   |                                       |   | 96,294 |   |   | 306,968 |   |   | 365,880 |   |
| Securities                gains, net                                                                                                                                                 |   |                                        | -         |                                       |   | 22,661 |   |   | 6,282 |   |   | 46,798 |   |
| Gains                (losses) on sales and disposal of premises and equipment                                                                                                        |   |                                        | -         |                                       |   | 70,501 |   |   | (5,666 | ) |   | 196,621 |   |
| Other                operating income                                                                                                                                                |   |                                        | 137,595   |                                       |   | 134,313 |   |   | 410,223 |   |   | 398,152 |   |
|                             Total other income                                                                           |   |                                        | 680,690   |                                       |   | 595,735 |   |   | 1,905,593 |   |   | 1,782,546 |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
|  Other                Expense:                                                                                                                                                  |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
| Salaries                and other personnel expense                                                                                                                                  |   |                                        | 1,313,188 |                                       |   | 1,245,709 |   |   | 3,919,758 |   |   | 3,777,720 |   |
| Net                occupancy and equipment expense                                                                                                                                   |   |                                        | 329,742   |                                       |   | 334,994 |   |   | 967,135 |   |   | 947,220 |   |
| Other                operating expense                                                                                                                                               |   |                                        | 519,039   |                                       |   | 504,086 |   |   | 1,611,654 |   |   | 1,595,172 |   |
|                             Total other expense                                                                          |   |                                        | 2,161,969 |                                       |   | 2,084,789 |   |   | 6,498,547 |   |   | 6,320,112 |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
|                             Earnings before income taxes                                                                 |   |                                        | 1,041,660 |                                       |   | 948,155 |   |   | 2,850,650 |   |   | 2,625,618 |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
| Income                taxes                                                                                                                                                          |   |                                        | 309,563   |                                       |   | 275,194 |   |   | 839,498 |   |   | 743,392 |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
|                             Net earnings                                                                            |   | $                                           | 732,097   |                                       |   | 672,961 |   |   | 2,011,152 |   |   | 1,882,226 |   |
|                                                                                                                                                                                 |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
| Earnings                per common share based on average outstanding                                                                                                                |   |                                        |      |                                       |   |   |   |   |   |   |   |   |   |
|                     shares of 899,865 in 2005 and 899,885 in 2004:                                                                                          |   | $                                           | 0.81      |                                       |   | 0.75 |   |   | 2.24 |   |   | 2.09 |   |

----

Index

**OCONEE      FINANCIAL CORPORATION AND SUBSIDIARY**

Consolidated

|                                                                                                                                              |   |  **Three                Months Ended** |     | **Nine                Months Ended** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------|----------|--------------------------------------|--------|
|                                                                                                                                              |   | **2005**                                    |     | **2004**                             |   | **2005** |   | **2004** |   |
|                                                                                                                                              |   |                                        |     |                                 |   |   |   |   |   |
| Net                earnings                                                                                                                  |   | $                                           | 732,097  |                                 |   | 672,961 |   |   | 2,011,150 |   |   | 1,882,226 |   |
|                                                                                                                                              |   |                                        |     |                                 |   |   |   |   |   |   |   |   |   |
| Other                comprehensive income, net of tax:                                                                                            |   |                                        |     |                                 |   |   |   |   |   |   |   |   |   |
|                     Unrealized gains on securities available for sale:                                                        |   |                                        |     |                                 |   |   |   |   |   |   |   |   |   |
|                          Holding gains arising during period, net of (benefit) tax                   |   |                                        |     |                                 |   |   |   |   |   |   |   |   |   |
|                             of ($68,971), $441,562, ($176,499) and $10,761            |   |                                        | (112,722 | )                                    |   | 749,781 |   |   | (288,462 | ) |   | 20,889 |   |
|                          Reclassification adjustments for gains included in                net  |   |                                        |     |                                 |   |   |   |   |   |   |   |   |   |
|                             earnings, net of tax of $0, $8,609, $2,385 and $17,765    |   |                                        | -        |                                 |   | (14,052 | ) |   | (3,897 | ) |   | (29,033 | ) |
|                                                                                                                                              |   |                                        |     |                                 |   |   |   |   |   |   |   |   |   |
|                          Total other comprehensive (loss) income                                     |   |                                        | (112,722 | )                                    |   | 735,729 |   |   | (292,359 | ) |   | (8,144 | ) |
|                                                                                                                                              |   |                                        |     |                                 |   |   |   |   |   |   |   |   |   |
|                          Comprehensive income                                                        |   | $                                           | 619,375  |                                 |   | 1,408,690 |   |   | 1,718,791 |   |   | 1,874,082 |   |

----

Index

**OCONEE      FINANCIAL CORPORATION AND SUBSIDIARY**

Statements 

|                                                                                                                                                                                                                              |   | **2005** |        | **2004** |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|-------------|----------|--------|
| Cash                flows from operating activities:                                                                                                                                                                              |   |     |        |     |   |   |   |
|      Net                earnings                                                                                                                                                                         |   | $        | 2,011,151   |     |   | 1,882,226 |   |
|          Adjustments                to reconcile net earnings to net                                                                                                                 |   |     |        |     |   |   |   |
|             cash                provided by operating activities:                                                                                                     |   |     |        |     |   |   |   |
|                 Provision                for loan losses                                                                                          |   |     | 612,000     |     |   | 274,000 |   |
|                 Depreciation,                amortization and accretion                                                                           |   |     | 526,802     |     |   | 652,613 |   |
|                 Gain                on sale of investment securities                                                                              |   |     | (6,282      | )        |   | (46,798 | ) |
|                 Loss                (gain) on sales and disposals of fixed assets                                                                 |   |     | 5,666       |     |   | (196,621 | ) |
|                 Gain                on sale of other real estate owned                                                                            |   |     | (14,035     | )        |   | (27,906 | ) |
|                 Change                in assets and liabilities:                                                                                  |   |     |        |     |   |   |   |
|                     Interest                receivable and other assets                                                       |   |     | (474,770    | )        |   | (474,993 | ) |
|                     Interest                payable and other liabilities                                                     |   |     | 199,314     |     |   | 427,107 |   |
|                     Mortgage                loans held for sale                                                               |   |     | (1,143,810  | )        |   | 2,521,971 |   |
|                                                                                                                                                                                                                              |   |     |        |     |   |   |   |
|                            Net                cash provided by operating activities        |   |     | 1,716,036   |     |   | 5,011,599 |   |
|                                                                                                                                                                                                                              |   |     |        |     |   |   |   |
| Cash                flows from investing activities:                                                                                                                                                                              |   |     |        |     |   |   |   |
| Proceeds                from sale of investment securities                                                                                                                                                                        |   |     | 339,131     |     |   | 2,950,468 |   |
| Proceeds                from calls, maturities, and paydowns of                                                                                                                                                                   |   |     |        |     |   |   |   |
| investment                securities available for sale                                                                                                                                                                           |   |     | 9,374,016   |     |   | 14,594,532 |   |
| Purchases                of investment securities available for sale                                                                                                                                                              |   |     | (13,805,486 | )        |   | (7,679,327 | ) |
| Purchases                of other securities                                                                                                                                                                                      |   |     | (10,100     | )        |   | - |   |
| Net                change in loans                                                                                                                                                                                                |   |     | (2,964,107  | )        |   | (13,502,688 | ) |
| Purchases                of premises and equipment                                                                                                                                                                                |   |     | (377,737    | )        |   | (2,259,134 | ) |
| Proceeds                from sale of premises and equipment                                                                                                                                                                       |   |     | -           |     |   | 392,532 |   |
| Proceeds                from sale of other real estate owned                                                                                                                                                                      |   |     | 598,496     |     |   | 522,331 |   |
|                                                                                                                                                                                                                              |   |     |        |     |   |   |   |
|                                            Net cash used by investing activities           |   |     | (6,845,787  | )        |   | (4,981,286 | ) |
|                                                                                                                                                                                                                              |   |     |        |     |   |   |   |
| Cash                flows from financing activities:                                                                                                                                                                              |   |     |        |     |   |   |   |
| Net                change in deposits                                                                                                                                                                                             |   |     | 15,582,762  |     |   | (14,034,163 | ) |
| Net                change in securities sold under repurchase agreements                                                                                                                                                          |   |     | 1,655,466   |     |   | 1,087,449 |   |
| Net                change in federal funds purchased                                                                                                                                                                              |   |     | -           |     |   | 2,368,000 |   |
| Purchase                and retirement of stock                                                                                                                                                                                   |   |     | (3,640      | )        |   | - |   |
| Dividends                paid                                                                                                                                                                                                     |   |     | (899,885    | )        |   | (899,885 | ) |
|                                                                                                                                                                                                                              |   |     |        |     |   |   |   |
|                            Net                cash provided (used) by financing activities |   |     | 16,334,703  |     |   | (11,478,599 | ) |
|                                                                                                                                                                                                                              |   |     |        |     |   |   |   |
| Net                increase (decrease) in cash and cash equivalents                                                                                                                                                               |   |     | 11,204,952  |     |   | (11,448,286 | ) |
|                                                                                                                                                                                                                              |   |     |        |     |   |   |   |
| Cash                and cash equivalents at beginning of period                                                                                                                                                                   |   |     | 15,753,366  |     |   | 17,994,802 |   |
|                                                                                                                                                                                                                              |   |     |        |     |   |   |   |
| Cash                and cash equivalents at end of period                                                                                                                                                                         |   | $        | 26,958,318  |     |   | 6,546,516 |   |

----

Index

**OCONEE      FINANCIAL CORPORATION AND SUBSIDIARY**

|                                                                                                |   |   | **2005**  |   |   | **2004**  |   |
|-----------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|--------|----------------|--------|
|                                                                                                |   |   |      |   |   |           |   |
| Supplemental                cash flow information:                                             |   |   |      |   |   |           |   |
|      Cash                paid for interest                                 |   | $      | 3,499,681 |   | $      | 2,772,043      |   |
|      Cash                paid for taxes                                    |   | $      | 953,000   |   | $      | 754,000        |   |
|                                                                                                |   |   |      |   |   |           |   |
| Noncash                investing and financing activities:                                          |   |   |      |   |   |           |   |
|      Transfer                from loans to other real estate owned         |   | $      | 112,665   |   | $      | 781,608        |   |
|      Change                in dividends payable                            |   | $      | 899,885   |   | $      | 899,885        |   |
|      Change                in net unrealized gain on investment securities |   |   |      |   |   |           |   |
|         available                for sale, net of tax       |   | $      | (292,359  | )      | $      | (8,144         | )      |

----

Index

**OCONEE      FINANCIAL CORPORATION AND SUBSIDIARY**

Notes

| (1) | Basis                of Presentation |
|-----|--------------------------------------|

| (2) | Net                Earnings Per Common Share |
|-----|----------------------------------------------|

----

Index

**OCONEE      FINANCIAL CORPORATION AND SUBSIDIARY**

| (3) | Allowance                for Loan Losses |
|-----|------------------------------------------|

|                                                        |   | **2005** |      | **2004** |   |
|-------------------------------------------------------------|--------|----------|-----------|----------|--------|
|                                                        |   |     |      |     |   |
| Balance                at beginning of year                 |   | $        | 2,531,330 |     |   | 2,669,204 |   |
| Amounts                charged off                          |   |     | (232,008  | )        |   | (325,855 | ) |
| Recoveries                on amounts previously charged off |   |     | 54,817    |     |   | 178,421 |   |
| Provision                for loan losses                    |   |     | 612,000   |     |   | 274,000 |   |
|                                                        |   |     |      |     |   |   |   |
| Balance                at September 30                      |   | $        | 2,966,139 |     |   | 2,795,770 |   |

----

Index

**MANAGEMENT’SDISCUSSION      AND ANALYSIS OR PLAN OF      OPERATION**

**Forward-Looking      Statements**

**Financial      Condition**

----

Index

**Results      of Operations**

** **

----

Index

**Interest      rate sensitivity**

**Liquidity**

----

Index

**Contractual      Obligations and Commitments**

**Capital**

| Risk-Based                Capital Ratios               |   |
|--------------------------------------------------------|--------|
|                                                   |   |
| Tier                1 Capital, Actual                  |   |   | 12.0 | % |
| Tier                1 Capital minimum requirement      |   |   | 4.0 | % |
|                                                   |   |   |  |   |
| Excess                                                 |   |   | 8.0 | % |
|                                                   |   |   |  |   |
| Total                Capital, Actual                   |   |   | 13.2 | % |
| Total                Capital minimum requirement       |   |   | 8.0 | % |
|                                                   |   |   |  |   |
| Excess                                                 |   |   | 5.2 | % |
|                                                   |   |   |  |   |
| Leverage                Ratio                          |   |   |  |   |
|                                                   |   |   |  |   |
| Tier                1 Capital to adjusted total assets |   |   | 9.0 | % |
| Minimum                leverage requirement            |   |   | 3.0 | % |
|                                                   |   |   |  |   |
| Excess                                                 |   |   | 6.0 | % |

----

Index

**CONTROLSAND      PROCEDURES**

----

Index

**PART      II.  OTHER INFORMATION**

**OCONEE      FINANCIAL CORPORATION AND SUBSIDIARY**

Legal

Unregistered

Item      3.          Defaults      Upon Senior Securities

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

None      

Item      6.         Exhibits      

| (a)   | Exhibits  |                                                                                                                                                                                                                                                                         |
|-----------------|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|            |      |                                                                                                                                                                                                                                                                         |
|            | 3.1  | Articles                of Incorporation of Oconee Financial Corporation, dated August 27,                1998                (included as Exhibit 3.1 to the Bank’s 10-KSB filed with the SEC on March                30, 2004 and incorporated herein by reference). |
|            |      |                                                                                                                                                                                                                                                                         |
|            | 3.2       | Amended                and Restated Bylaws of Oconee Financial Corporation, dated May 7,                2001                (included as Exhibit 3.2 to the Bank’s 10-KSB filed with the SEC on April                1, 2002 and incorporated herein by reference).    |
|            |      |                                                                                                                                                                                                                                                                         |
|            | 4         | See                Exhibits 3.1 and 3.2 for provisions of the Articles of Incorporation                and                Amended and Restated Bylaws which define the rights of the holders                of                Common Stock of the Bank.                      |
|            |      |                                                                                                                                                                                                                                                                         |
|            | 4.1       | Form                of Common Stock Certificate (included as Exhibit 4.1 to the Bank’s 10-KSB                filed with the SEC on March 31, 2005 and incorporated herein by                reference).                                                                |
|            |      |                                                                                                                                                                                                                                                                         |
|            | 31.1      | Certification                by B. Amrey Harden, CEO and President of the Corporation, as adopted                pursuant to Section 302 of the Sarbanes-Oxley Act of                2002.                                                                                   |
|            |      |                                                                                                                                                                                                                                                                         |
|            | 31.2      | Certification                by Jerry K. Wages, Senior Executive Vice President and Chief Financial                Officer of the Corporation, as adopted pursuant to Section 302 of                the                Sarbanes-Oxley Act of 2002.                           |
|            |      |                                                                                                                                                                                                                                                                         |
|            | 32        | Certification                of the Chief Executive Officer and the Chief Financial Officer pursuant                to                Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                         |
|            |      |                                                                                                                                                                                                                                                                         |

----

Index

**OCONEE      FINANCIAL CORPORATION AND SUBSIDIARY**

**SIGNATURES**

|   |           OCONEE                FINANCIAL CORPORATION  By:  /s/                B. Amrey                Harden                                                                                                                      B. Amrey Harden, President and CEO                       (Principal Executive Officer) Date:                    November                14, 2005                                                                                    By:   /s/                Jerry K.                Wages                                                                                                       Jerry K. Wages, Sr. Executive Vice President and CFO                       (Principal Financial Officer)       Date:                     November                14, 2005                                                                                    By:  /s/                Steven A.                Rogers                                                                                  Steven                A. Rogers       Vice                President and Controller       (Principal                Accounting Officer)  Date:                     November                14, 2005                                                                                  |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |