SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

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

                  For the Quarterly Period Ended June 30, 2002

                                       OR

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

                        For the Transition Period from to

                      Commission file number   000-30511
                                             -------------

                            Cherokee Banking Company
                            ------------------------
             (Exact name of registrant as specified in its charter)

          Georgia                        6711                    58-2432974
-------------------------    ----------------------------   --------------------
(State of Jurisdiction of    (Primary Standard Industrial    (I.R.S. Employer
    Incorporation or          Classification Code Number)   Identification  No.)
     organization)

1275 Riverstone Parkway
Canton, Georgia                                                       30114
-------------------------------                                     ----------
(Address of principal executive                                     (Zip Code)
offices)

                                  770-479-3400
                                ----------------
                               (Telephone Number)


                                 Not Applicable
                                 --------------
                          ( Former name, former address
                            and former fiscal year,
                          if changed since last report)

     Check  whether  the  issurer: (1) filed all reports required to be filed by
Section  13  or 15(d) of the Exchange Act during the past 12 months (or for such
shorter  period  that the registrant was required to file such reports), and (2)
has  been  subject  to  such  filing  requirements  for  the  past  90  days.

                                 YES   XX      NO
                                      ----

                      APPLICABLE ONLY TO CORPORATE ISSUERS

     State  the  number of shares outstanding of each of the issuer's classes of
common  equity,  as  of  the  latest  practicable  date:

     738,658  shares  of  common  stock,  no  par  value  per  share, issued and
outstanding  as  of  August  1,  2002.

     Transitional Small Business Disclosure Format (check one):  YES     NO  XX
                                                                            ----


<PAGE>
                            CHEROKEE BANKING COMPANY

                                      INDEX

                                                                        Page No.
                                                                       ---------

PART  I           FINANCIAL  INFORMATION

     Item  1.     Financial  Statements                                        3

                  Consolidated Balance Sheet (unaudited) at June 30, 2002      3

                  Consolidated Statement of Operations (unaudited)
                    for the Three Months and the Six Months Ended June
                    30, 2002 and 2001                                          4

                  Consolidated Statement of Comprehensive Income (unaudited)
                    for the Six Months Ended June 30, 2002 and 2001            5

                  Consolidated Statement of Cash Flows (unaudited) for the
                    Six Months Ended June 30, 2002 and 2001                    6

                  Notes to Consolidated Financial Statements (unaudited)       7

     Item 2.      Management's Discussion and Analysis of Financial
                    Condition and Results  of  Operations                      8

PART  II.         OTHER  INFORMATION

     Item  1.     Legal  Proceedings                                           9

     Item  2.     Changes  in  Securities                                      9

     Item  3.     Defaults  Upon  Senior  Securities                           9

     Item  4.     Submission of Matters to a Vote of Security Holders          9

     Item  5.     Other  Information                                           9

     Item  6.     Exhibits  and  Reports  on  Form  8-K                        9





This  Report  contains  statements  which  constitute forward-looking statements
within  the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of  the  Securities Exchange Act of 1934. These statements appear in a number of
places in this Report and include all statements regarding the intent, belief or
current  expectations of the Company, its directors or its officers with respect
to,  among other things: (1) the Company's financing plans; (2) trends affecting
the  Company's  financial  condition or results of operations; (3) the Company's
growth  strategy  and operating strategy; and (4) the declaration and payment of
dividends.  Investors are cautioned that any such forward-looking statements are
not  guarantees  of  future performance and involve risks and uncertainties, and
that  actual  results  may  differ  materially  from  those  projected  in  the
forward-looking  statements  as  a  result  of various factors discussed herein.


<PAGE>
<TABLE>
<CAPTION>
                          PART I. FINANCIAL INFORMATION

Item  1.  Financial  Statements

                            CHEROKEE BANKING COMPANY

                           CONSOLIDATED BALANCE SHEET

                                  JUNE 30, 2002
                                   (UNAUDITED)


                                     Assets
                                     ------

<S>                                                               <C>
Cash and due from banks                                           $ 5,826,554
Federal funds sold                                                    508,000
                                                                  ------------

          Cash and cash equivalents                                 6,334,554

Interest-bearing deposits                                             398,000
Investment securities available-for-sale                           29,723,954
Other investments                                                     504,350
Loans, net                                                         40,150,041
Premises and equipment, net                                         3,578,085
Accrued interest receivable and other assets                        1,089,400
                                                                  ------------

                                                                  $81,778,384
                                                                  ============

                      Liabilities and Stockholders' Equity
                      ------------------------------------

Liabilities:
     Deposits:
          Non-interest bearing                                    $ 8,105,146
          Interest bearing                                         60,328,112
                                                                  ------------

          Total deposits                                           68,433,258

     Advances from the Federal Home Loan Bank                       5,500,000
     Accrued interest payable and other liabilities                   549,744
                                                                  ------------

          Total liabilities                                        74,483,002
                                                                  ------------

Stockholders' equity:
     Preferred stock, no par value; 2,000,000 shares authorized;
          no shares issued and outstanding                                  -
     Common stock, no par value; 10,000,000 shares authorized;
          738,658 shares issued and outstanding                     7,330,505
     Accumulated deficit                                             (170,479)
     Accumulated other comprehensive income                           135,356
                                                                  ------------

          Total stockholders' equity                                7,295,382
                                                                  ------------

                                                                  $81,778,384
                                                                  ============


See  accompanying  notes  to  unaudited  consolidated  financial  statements.
</TABLE>


                                      -2-
<PAGE>
<TABLE>
<CAPTION>
                               CHEROKEE BANKING COMPANY

                         CONSOLIDATED STATEMENTS OF EARNINGS

         FOR THE THREE MONTHS AND THE SIX MONTHS ENDED JUNE 30, 2002 AND 2001
                                     (UNAUDITED)


                                                Three Months          Six Months
                                              Ended  June  30       Ended  June  30
                                            -------------------  --------------------
                                               2002      2001      2002       2001
                                            ----------  -------  ---------  ---------
<S>                                         <C>         <C>      <C>        <C>
Interest income:
     Interest and fees on loans             $  750,118  666,814  1,435,360  1,204,220
     Investment securities                     391,887  228,769    804,504    494,056
     Interest on federal funds sold             10,195   72,805     20,095    142,972
     Interest on deposits with other banks       7,232   18,753     16,894     50,898
                                            ----------  -------  ---------  ---------

     Total interest income                   1,159,432  987,141  2,276,853  1,892,146
                                            ----------  -------  ---------  ---------

Interest expense:
     Deposits                                  375,391  440,439    772,169    861,981
     Other borrowings                           47,050        -     79,784          -
                                            ----------  -------  ---------  ---------

     Total interest expense                    422,441  440,439    851,953    861,981
                                            ----------  -------  ---------  ---------

     Net interest income                       736,991  546,702  1,424,900  1,030,165

Provision for loan losses                       53,481   58,073    115,572    121,464
                                            ----------  -------  ---------  ---------

     Net interest income after provision
          for loan losses                      683,510  488,629  1,309,328    908,701
                                            ----------  -------  ---------  ---------

Other income:
     Service charges on deposit accounts        84,154   74,162    167,307    134,753
     Other operating income                     56,801   69,222    107,458    104,365
                                            ----------  -------  ---------  ---------

          Total other income                   140,955  143,384    274,765   239,118
                                            ----------  -------  ---------  ---------
Other expense:
     Salaries and other personnel expense      382,566  281,048    735,154    538,966
     Net occupancy and equipment expense        65,162   61,510    126,791    123,224
     Other operating expense                   252,542  186,916    495,189    353,506
                                            ----------  -------  ---------  ---------

          Total other expense                  700,270  529,474  1,357,134  1,015,696
                                            ----------  -------  ---------  ---------

     Earnings before income tax expense        124,195  102,539    226,959    132,123

Income tax expense                              47,574        -     86,624          -
                                            ----------  -------  ---------  ---------

     Net earnings                           $   76,621  102,539    140,335    132,123
                                            ==========  =======  =========  =========

Basic earnings per share                    $      .10      .14        .19        .18
                                            ==========  =======  =========  =========
Diluted earnings per share                  $      .10      .14        .18        .18
                                            ==========  =======  =========  =========

See accompanying notes to unaudited consolidated financial statements.
</TABLE>


                                      -3-
<PAGE>
<TABLE>
<CAPTION>
                            CHEROKEE BANKING COMPANY

                CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                FOR THE SIX MONTHS ENDED JUNE 30, 2002 AND 2001
                                  (UNAUDITED)



                                                        For the Six Months Ended
                                                     -------------------------------
                                                      June 30, 2002   June 30, 2001
                                                     ---------------  --------------
<S>                                                  <C>              <C>
Net earnings                                         $      140,335         132,123

Other comprehensive income:
      Unrealized holding gains on investment
          securities available-for-sale                     392,211          74,271
      Less income tax expense related to investment
          securities available-for-sale                    (149,040)        (28,223)
                                                     ---------------  --------------

      Total other comprehensive income, net of tax          243,171          46,048
                                                     ---------------  --------------


      Total comprehensive income                     $      383,506         178,171
                                                     ===============  ==============

See accompanying notes to unaudited consolidated financial statements.
</TABLE>


                                      -4-
<PAGE>
<TABLE>
<CAPTION>
                                           CHEROKEE BANKING COMPANY

                                    CONSOLIDATED STATEMENTS OF CASH FLOWS

                               FOR THE SIX MONTHS ENDED JUNE 30, 2002 AND 2001
                                                 (UNAUDITED)



                                                                                       2002          2001
                                                                                   -------------  -----------
<S>                                                                                <C>            <C>
Cash flows from operating activities:
     Net earnings                                                                  $    140,335      132,123
     Adjustments to reconcile net earnings to net cash
          provided by operating activities:
               Provision for loan losses                                                115,572      121,464
               Depreciation, amortization and accretion                                  78,967       23,969
               Change in:
                    Accrued interest receivable and other assets                         13,473       (7,197)
                    Accrued interest payable and other liabilities                      (63,102)     227,138
                                                                                   -------------  -----------

                         Net cash provided by operating activities                      285,245      497,497
                                                                                   -------------  -----------

Cash flows from investing activities:
      Proceeds from maturities and paydowns
            of investment securities available-for-sale                               5,578,146    4,689,956
      Proceeds from sales of investment securities available-for-sale                 1,984,786            -
      Purchases of investment securities available-for-sale                          (8,131,391)  (4,048,930)
      Net change in interest-bearing deposits                                           599,000      991,000
      Purchase of other investments                                                    (199,100)     (19,800)
      Change in loans                                                                (9,666,798)  (8,477,137)
      Purchase of premises and equipment                                               (675,469)     (38,060)
                                                                                   -------------  -----------

                         Net cash used by investing activities                      (10,510,826)  (6,902,971)
                                                                                   -------------  -----------

Cash flows from financing activities:
      Net change in federal funds purchased                                            (222,000)           -
      Proceeds from FHLB borrowings                                                   5,500,000            -
      Net change in deposits                                                          9,670,512   13,479,171
                                                                                   -------------  -----------

                         Net cash provided by financing activities                   14,948,512   13,479,171
                                                                                   -------------  -----------

Net change in cash and cash equivalents                                               4,722,931    7,073,697

Cash and cash equivalents at beginning of the period                                  1,611,623    3,278,636
                                                                                   -------------  -----------

Cash and cash equivalents at end of the period                                     $  6,334,554   10,352,333
                                                                                   =============  ===========

Noncash investing activities:
     Change in unrealized gain/loss on securities available-for-sale, net of tax   $    243,171       46,048

Suppmemental cash flow information:
     Cash paid for interest                                                        $    884,086      698,488
     Cash paid for income taxes                                                    $     43,436            -


See accompanying notes to unaudited consolidated financial statements.
</TABLE>


                                      -5-
<PAGE>
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

NOTE  1  -  BASIS  OF  PRESENTATION
-----------------------------------

Cherokee  Banking Company, Inc. (the Company), a bank holding company, owns 100%
of  the  outstanding  common  stock  of  Charokee  Bank,  N.A. (the Bank), which
operates  in  the Canton, Georgia area. The Bank opened for business on July 26,
1999.

The  consolidated  financial  statements include the accounts of the Company and
the  Bank.  All  intercompany  accounts and transactions have been eliminated in
consolidation.

The  accompanying financial statements have been prepared in accordance with the
requirements  for  interim  financial  statements  and,  accordingly,  they omit
disclosures,  which  would  substantially  duplicate those contained in the most
recent  annual  report to shareholders on Form 10-KSB.  The financial statements
as of June 30, 2002 and for the interim periods ended June 30, 2002 and 2001 are
unaudited and, in the opinion of management, include all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation.  For
further information, refer to the financial statements and the notes included in
the  Company's  2001  Form  10-KSB.


NOTE 2 - CRITICAL ACCOUNTING POLICIES AND ESTIMATES
---------------------------------------------------

The  Company  has  adopted  various  accounting  policies,  which  govern  the
application  of accounting principles generally accepted in the United States of
America  in  the  preparation  of  our  financial  statements.  The  Company's
significant  accounting  policies  are  described  in  the  footnotes  to  the
consolidated  financial  statements  at December 31, 2001 as filed on our annual
report  on  Form  10-KSB.

Certain accounting policies involve significant estimates and assumptions by the
Company,  which  have  a material impact on the carrying value of certain assets
and liabilities.  The Company considers these accounting policies to be critical
accounting policies.  The estimates and assumptions used are based on historical
experience  and  other  factors,  which  are believed to be reasonable under the
circumstances.  Because  of  the  nature  of the estimates and assumptions made,
actual  results  could  differ  from these estimates and assumptions which could
have  a material impact on carrying values of assets and liabilities and results
of  operations.

The Company believes that the allowance for loan losses is a critical accounting
policy  that  requires  the  most  significant  judgments  and estimates used in
preparation  of  its consolidated financial statements.  Refer to the portion of
management's  discussion  and  analysis  of  financial  condition and results of
operations that addresses the allowance for loan losses for a description of the
Company's  processes  and  methodology  for  determining  the allowance for loan
losses.


                                      -6-
<PAGE>
NOTE 3  -  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.
Potential  common shares had no effect on earnings per share for the quarter and
six  months  ended June 30, 2001.  The reconciliation of the amounts used in the
computation  of both "basic earnings per share" and "diluted earnings per share"
for  the  quarter  and six months ended June 30, 2002 presented in the financial
statements  were  calculated  as  follows:


                                            Net     Common   Per Share
For the quarter ended June 30, 2002:     Earnings    Share     Amount
                                         ---------  -------  ----------
          Basic earnings per share       $  76,621  738,658        .10

          Effect of stock options                -   37,629          -
                                         ---------  -------  ----------

          Diluted earnings per share     $  76,621  776,287        .10
                                         =========  =======  ==========


                                            Net     Common   Per Share
For the six months ended June 30, 2002:  Earnings    Share    Amount
                                         ---------  -------  ----------

          Basic earnings per share       $ 140,335  738,658        .19

          Effect of stock options                -   37,629       (.01)
                                         ---------  -------  ----------

          Diluted earnings per share     $ 140,335  776,287        .18
                                         =========  =======  ==========


                                      -7-
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
-------------------------------------------------------------------------------
OF OPERATIONS
-------------

Forward-Looking  Statements
---------------------------

The  following  is  a  discussion of our financial condition as of June 30, 2002
compared  to  December  31,  2001.  These comments should be read in conjunction
with  our consolidated financial statements and accompanying footnotes appearing
in  this report.  This report contains "forward-looking statements" relating to,
without  limitation,  future  economic  performance,  plans  and  objectives  of
management  for  future  operations,  and  projections  of  revenues  and  other
financial  items  that  are  based  on the beliefs of our management, as well as
assumptions  made by and information currently available to our management.  The
words  "expect",  "estimate",  "anticipate",  and  "believe", as well as similar
expressions,  are  intended  to identify forward-looking statements.  Our actual
results  may differ materially from the results discussed in the forward-looking
statements,  and  our  operating  performance each quarter is subject to various
risks  and uncertainties. Factors that could cause actual results to differ from
those  discussed  in the forward-looking statements include, but are not limited
to:

     (1)  the strength of the U.S. economy in general and the strength of the
          local economies in which operations are conducted;
     (2)  the effects of and changes in trade, monetary and fiscal policies and
          laws, including interest rate policies of the Board of Governors of
          the Federal Reserve System;
     (3)  inflation, interest rate, market and monetary fluctuations;
     (4)  the timely development of and acceptance of new products and services
          and perceived overall value of these products and services by users;
     (5)  changes in consumer spending, borrowing and saving habits;
     (6)  technological changes;
     (7)  acquisitions;
     (8)  the ability to increase market share and control expenses;
     (9)  the effect of changes in laws and regulations (including laws and
          regulations concerning taxes, banking, securities and insurance) with
          which the Company and its subsidiary must comply;
     (10) the effect of changes in accounting policies and practices, as may be
          adopted by the regulatory agencies as well as the Financial Accounting
          Standards Board;
     (11) changes in the Company's organization, compensation and benefit plans;
     (12) the costs and effects of litigation and of unexpected or adverse
          outcomes in such litigation; and
     (13) the Company's success at managing the risks involved in the foregoing.

Forward-looking statements speak only as of the date on which they are made.  We
undertake  no  obligation  to  update  any  forward-looking statement to reflect
events or circumstances after the date on which the statement is made to reflect
the  occurrence  of  unanticipated  events.

RESULTS  OF  OPERATIONS
-----------------------

NET  INTEREST  INCOME
---------------------

For  the  six months ended June 30, 2002, net interest income totaled $1,425,000
as  compared  to  $1,030,000  for the same period in 2001.  Interest income from
loans, including fees increased $231,000 or 19% to $1,435,000 for the six months
ended  June 30, 2002.  The increase in net interest income is due to the overall
growth  in  the volume of interest earning assets, partially offset by decreases
in overall weighted average interest rates.  The net interest margin realized on
earning  assets and the interest rate spread were 4.18% and 3.64%, respectively,
for  the  six  months  ended  June  30,  2002.

For  the  quarter  ended  June  30,  2002, interest income totaled $1,159,000 as
compared  to  $987,000  for the same period in 2001.  Interest expense decreased
from  $440,000  for  the  quarter  ended  June 30, 2001 to $422,000 for the same
period  in  2002.  The  increase  in  net  interest income is due to the overall
growth in interest earning assets.  For the quarter ended June 30, 2002, the net
interest  margin  was  4.22%  and  the  interest  rate  spread  was  3.66%.


                                      -8-
<PAGE>
ITEM  2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
--------------------------------------------------------------------------------
OF  OPERATIONS,  CONTINUED
--------------------------

INTEREST  RATE  SENSITIVITY  AND  ASSET  LIABILITY  MANAGEMENT
--------------------------------------------------------------

Interest  rate sensitivity measures the timing and magnitude of the repricing of
assets  compared  with  the repricing of liabilities and is an important part of
asset/liability  management  of  a  financial  institution.  The  objective  of
interest  rate  sensitivity  management  is  to  generate  stable  growth in net
interest  income,  and  to  control  the  risks  associated  with  interest rate
movements.  Management  constantly  reviews  interest rate risk exposure and the
expected  interest  rate  environment  so  that  adjustments  in  interest  rate
sensitivity  can be timely made.  Since the assets and liabilities of a bank are
primarily  monetary  in  nature  (payable  in  fixed, determinable amounts), the
performance  of  a  bank  is  affected more by changes in interest rates than by
inflation.  Interest  rates  generally  increase  as  the  rate  of  inflation
increases,  but  the  magnitude  of  the  change  in  rates may not be the same.

Net  interest  income  is  the  primary  component  of  net income for financial
institutions.  Net  interest  income  is affected by the timing and magnitude of
repricing  of as well as the mix of interest sensitive and noninterest sensitive
assets and liabilities.  "Gap" is a static measurement of the difference between
the  contractual  maturities or repricing dates of interest sensitive assets and
interest  sensitive  liabilities  within the following twelve months.  Gap is an
attempt  to  predict  the  behavior of the Bank's net interest income in general
terms  during periods of movement in interest rates.  In general, if the Bank is
asset  sensitive,  more of its interest sensitive assets are expected to reprice
within  twelve  months  than  its  interest  sensitive liabilities over the same
period.  In a rising interest rate environment, assets repricing more quickly is
expected  to  enhance  net  interest income.  Alternatively, decreasing interest
rates would be expected to have the opposite effect on net interest income since
assets  would  theoretically  be  repricing at lower interest rates more quickly
than  interest  sensitive  liabilities.  Although  it  can  be used as a general
predictor,  Gap  as  a  predictor  of  movements  in  net  interest  income  has
limitations  due  to the static nature of its definition and due to its inherent
assumption  that  all  assets  will  reprice  immediately  and  fully  at  the
contractually  designated time.  At June 30, 2002, the Bank, as measured by Gap,
is in an asset sensitive position.  Management has several tools available to it
to  evaluate  and  affect interest rate risk, including deposit pricing policies
and  changes  in  the  mix of various types of assets and liabilities.  For more
information  on asset-liability management, see the annual report of Form 10-KSB
filed  with  the  Securities  and  Exchange  Commission.

PROVISION  AND  ALLOWANCE  FOR  LOAN  LOSSES
--------------------------------------------

The provision for loan losses is a critical accounting policy that is subject to
the  judgments  and  estimates  of  the  Bank.  The  provision  for  loan losses
represents  the  charge  to  operating  earnings  that  management  believes  is
necessary  to  maintain  the  allowance  for possible loan losses at an adequate
level.  The  provision  charged to expense was $116,000 for the six months ended
June  30,  2002  as compared to $121,000 for the six months ended June 30, 2001.
The  decrease  in  the  provision  has  been a result of management's efforts to
increase  the  allowance  to  match  the growth in the loan portfolio.  The loan
portfolio increased by approximately $9,633,000 during the six months ended June
30,  2002  as  compared to $8,356,000 during the six months ended June 30, 2001.
The  allowance  for  loan  losses was 1.25% of gross loans at June 30, 2002.  We
believe  that  the  allowance  for  loan  losses  is  adequate.  There are risks
inherent in making all loans, including risks with respect to the period of time
over  which  loans  may  be repaid, risks resulting from changes in economic and
industry  conditions,  risks inherent in dealing with individual borrowers, and,
in  the  case of a collateralized loan, risks resulting from uncertainties about
the  future value of the collateral.  We anticipate maintaining an allowance for
loan  losses  based on, among other things, historical experience, an evaluation
of  economic conditions, and regular reviews of delinquencies and loan portfolio
quality.  Our  judgment  about  the  adequacy  of  the allowance is based upon a
number  of  assumptions  about future events, which we believe to be reasonable,
but  which may not prove to be accurate.  Thus, there is a risk that charge-offs
in future periods could exceed the allowance for loan losses or that substantial
additional  increases  in  the  allowance  for  loan  losses  could be required.
Additions to the allowance for loan losses would result in a decrease of our net
income  and,  possibly,  our  capital.

NONINTEREST  INCOME
-------------------

Noninterest  income  for  the six months ended June 30, 2002 totaled $275,000 as
compared  to  $239,000  for the six months ended June 30, 2001.  The increase in
noninterest income was due to an increase in service charges on deposit accounts
during  the  six  months  ended  June 30, 2002 as compared to the same period in
2001.  The  increase in service charges was due to the increase in the number of
deposit  accounts  in  2002  compared  to  2001.


                                      -9-
<PAGE>
------
ITEM  2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
--------------------------------------------------------------------------------
OF  OPERATIONS,  CONTINUED
--------------------------

NONINTEREST  EXPENSE
--------------------

Total  noninterest expense for the six months ended June 30, 2002 was $1,357,000
as  compared  to $1,016,000 for the same period in 2001.  Salaries and benefits,
the  largest  component  of  noninterest  expense,  totaled $735,000 for the six
months ended June 30, 2002, compared to $539,000 for the same period a year ago.
Salary  and  benefits  expense  increased  due  to  the  addition  of additional
employees.   Other  operating  expenses  were  $495,000 for the six months ended
June  30,  2002  as compared to $354,000 for the six months ended June 30, 2001.
These  increases  in noninterest expenses are due to the continued growth of the
Bank.

Total  noninterest  expense  for the quarter ended June 30, 2002 was $700,000 as
compared to $529,000 for the same period in 2001.  Salaries and benefits totaled
$383,000  for the quarter ended June 30, 2002, compared to $281,000 for the same
period  a year ago. Salary and benefits expense increased due to the addition of
additional  employees.   Other  operating expenses were $253,000 for the quarter
ended June 30, 2002 as compared to $187,000 for the quarter ended June 30, 2001.
These  increases  in noninterest expenses are due to the continued growth of the
Bank.

On  July  1,  2002,  the Bank opened its second branch location.  The opening of
this  branch  is  expected  to better serve the Bank's existing customers and to
attract  new  customers.

INCOME  TAXES
-------------

The  income  tax  expense for the six months ended June 30, 2002 was $87,000 and
was  $48,000  for  the  quarter  ended  June 30, 2002. The Company recognized no
income  tax  expense or benefit during the quarter and six months ended June 30,
2001  due  to  the  fact  that  it  had  a net operating loss carryforward.  The
effective  tax  rate was 38% for the quarter and six months ended June 30, 2002.

NET  EARNINGS
-------------

The  combination  of  the above factors resulted in net earnings of $140,000 for
the six months ended June 30, 2002 compared to $132,000 for the six months ended
June  30,  2001.   Basic  earnings  per  share  was  $.19  for  the  six  months
ended  June 30, 2002 compared to $.18 for the same period in 2001.  Net earnings
were  $77,000  for  the quarter ended June 30, 2002 compared to $103,000 for the
same  period  in  2001.

Diluted  earnings  per  share  were  $.18 for the six months ended June 30, 2002
compared  to diluted earnings per share of $.18 in the same period in 2001.  The
dilutive  effect  of the Company's outstanding options and warrants was $.01 per
share  during  the  six  months  ended June 30, 2002.  The Company's options and
warrants  had no dilutive effect in the quarters ended June 30, 2002 and 2001 or
the  six  months  ended  June  30,  2001.

ASSETS  AND  LIABILITIES
------------------------

During  the first six months of 2002, total assets increased $15,418,000 or 23%,
when  compared  to December 31, 2001. The primary source of growth in assets was
net  loans,  which  increased  $9,551,000  or 31% during the first six months of
2002.  Investment securities available-for-sale increased $961,000 from December
31,  2001  to $29,724,000 at June 30, 2002.  Total deposits increased $9,671,000
or  16%,  from  the  December  31,  2001  amount  of  $58,763,000.

INVESTMENT  SECURITIES
----------------------

Investment  securities available-for-sale increased $961,000 from $28,763,000 at
December  31, 2001 to $29,724,000 at June 30, 2002. This increase was the result
of  excess  deposits being invested in securities.  All of the Bank's marketable
investment  securities  were  designated as available-for-sale at June 30, 2002.


                                      -10-
<PAGE>
ITEM  2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
--------------------------------------------------------------------------------
OF  OPERATIONS,  CONTINUED
--------------------------

PREMISES  AND  EQUIPMENT
------------------------

Premises  and  equipment,  net  of  depreciation, totaled $3,578,000 at June 30,
2002.  The  increase of $597,000 from the December 31, 2001 amount of $2,981,000
was  due  to  additions  related  to  the  Bank's  second  branch  location.

LOANS
-----

Gross  loans  totaled $40,660,000 at June 30, 2002, an increase of $9,633,000 or
31%  since  December  31, 2001.  The largest increase in loans was in commercial
and  industrial  loans, which increased $5,276,000 or 32% to $21,571,000 at June
30,  2002.  Balances within the major loans receivable categories as of June 30,
2002  and  December  31,  2001  are  as  follows:

<TABLE>
<CAPTION>
                                                       June 30, 2002   December 31, 2001
                                                      ---------------  -----------------
<S>                                                   <C>              <C>
 Real estate - construction                           $    8,870,012           4,214,108
 Real estate - mortgage                                    6,202,843           6,435,719
 Commercial and industrial                                21,570,726          16,294,606
 Consumer and other                                        4,016,423           4,082,555
                                                      ---------------  -----------------

                                                      $   40,660,004          31,026,988
                                                      ===============  =================

RISK ELEMENTS IN THE LOAN PORTFOLIO
------------------------------------

The following is a summary of risk elements in the loan portfolio:

                                                      June 30, 2002    December 31, 2001
                                                      ---------------  -----------------

 Loans:   Nonaccrual loans                            $      210,888               4,000

Accruing loans more than 90 days past due             $       16,742                   -

 Loans identified by the internal review mechanism:

    Criticized                                        $      687,586             655,923

    Classified                                        $      210,888             197,650

Activity in the Allowance for Loan Losses for the period  from January 1, 2002 to June
30, 2002 is as follows:

Balance, January 1,                                   $      428,173

Provision for loan losses for the period                     115,572

Net loans (charged off) recovered for the period             (33,782)
                                                      ---------------

Balance, end of period                                $      509,963
                                                      ===============

Gross loans outstanding, end of period                $   40,660,004
                                                      ===============

Allowance for loan losses to gross loans outstanding            1.25%
</TABLE>


                                      -11-
<PAGE>
ITEM  2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
--------------------------------------------------------------------------------
OF  OPERATIONS,  CONTINUED
--------------------------

DEPOSITS
--------

At  June  30,  2002 total deposits increased by $9,671,000, or 16% from December
31,  2001.   Noninterest-bearing demand deposits increased $2,484,000 or 44% and
interest-bearing  deposits  increased  $7,186,000  or  14%.

Balances  within  the  major deposit categories as of June 30, 2002 and December
31,  2001  are  as  follows:

                                           June 30, 2002   December 31, 2001
                                           --------------  -----------------
Noninterest-bearing demand deposits        $    8,105,146          5,620,933
Interest-bearing demand deposits               31,600,204         27,993,680
Savings deposits                                1,988,143          1,541,472
Certificates of deposit $100,000 and over       7,545,901          4,398,173
Other time deposits                            19,193,864         19,208,488
                                           --------------  -----------------

                                           $   68,433,258         58,762,746
                                           ==============  =================

LIQUIDITY
---------

The  Company's  liquidity  needs  include  the  funding  of  loans, purchases of
operating  assets,  etc.  Liquidity  needs  are  met  by  us  through  scheduled
maturities  of  loans  and  investments  on  the  asset side and through pricing
policies on the liability side for interest-bearing deposit accounts.  The level
of liquidity is measured by the loan-to-total borrowed funds ratio, which was at
54%  at  June  30,  2002  and  52%  at  December  31,  2001.

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  consist of commitments to extend credit and loans
sold with limited recourse.  Commitments to extend credit are agreements to lend
to  a  customer as long as there is no violation of any condition established in
the  contract.  Commitments  generally  have  fixed  expiration  dates  or other
termination clauses and may require payment of a fee.  A commitment involves, to
varying  degrees,  elements  of  credit  and interest rate risk in excess of the
amount  recognized in the balance sheets.  The Company's exposure to credit loss
in  the  event  of  non-performance  by  the  other  party  to the instrument is
represented  by  the  contractual  notional  amount  of  the  instrument.

Since  certain  commitments are expected to expire without being drawn upon, the
total  commitment amounts do not necessarily represent future cash requirements.
The  Company  uses  the  same  credit  policies  in  making  commitments  to
extend  credit  as  it  does  for  on-balance-sheet  instruments.

Collateral held for commitments to extend credit varies but may include accounts
receivable,  inventory,  property,  plant,  equipment,  and  income-producing
commercial  properties.

The  following  table  summarizes  the  Company's  off-balance-sheet  financial
instruments  whose  contract  amounts represent credit risk as of June 30, 2002:

     Commitments to extend credit                      $     8,232,369
     Standby letters of credit                         $        70,427

Management is not aware of any significant concentrations of loans to classes of
borrowers or industries that would be affected similarly by economic conditions.
Although  the Bank's loan portfolio is diversified, a substantial portion of its
borrowers'  ability  to  honor  the  terms  of  their  loans is dependent on the
economic  conditions  in  Cherokee  County  and  surrounding  areas.

We  also  have  obtained  lines  of credit available with correspondent banks to
purchase  federal  funds.  At  June  30,  2002,  unused  lines of credit totaled
$5,000,000.


                                      -12-
<PAGE>
ITEM  2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
--------------------------------------------------------------------------------
OF  OPERATIONS,  CONTINUED
--------------------------

CAPITAL  RESOURCES
------------------

Total  shareholders'  equity  increased  from $6,912,000 at December 31, 2001 to
$7,295,000 at June 30, 2002.  This increase was attributable to net earnings for
the  period  and  an  increase  of  $243,000  in  the  fair  value of securities
available-for-sale,  net  of  tax.

Bank  holding companies, such as us, and their banking subsidiaries are required
by  banking regulators to meet certain minimum levels of capital adequacy, which
are  expressed  in the form of certain ratios.  Capital is separated into Tier 1
capital  (essentially  common  shareholders'  equity less intangible assets) and
Tier  2  capital  (essentially the allowance for loan losses limited to 1.25% of
risk-weighted  assets).  The  first two ratios, which are based on the degree of
credit  risk  in  our  assets, provide the weighting of assets based on assigned
risk  factors  and  include off-balance sheet items such as loan commitments and
stand-by letters of credit.  The ratio of Tier 1 capital to risk-weighted assets
must be at least 4.0% and the ratio of total capital (Tier 1 capital plus Tier 2
capital)  to  risk-weighted  assets must be at least 8.0%.  The capital leverage
ratio  supplements  the  risk-based  capital  guidelines.

Banks  and  bank  holding  companies are required to maintain a minimum ratio of
Tier  1  capital  to  adjusted  quarterly  average  total  assets  of  3.0%.

The  following table summarizes the Bank's risk-based capital ratios at June 30,
2002:


     Tier 1 capital (to risk-weighted assets)                        11.32%
     Total capital (to risk-weighted assets)                         12.31%
     Tier 1 capital (to total average assets)                         7.74%

As  of  June  30,  2002,  the  holding company had approximately $1.2 million in
unencumbered  cash  that  could  be  contributed  to the Bank if necessary.  The
Bank's capital  ratios listed above would increase if these funds were injected.

REGULATORY  MATTERS
-------------------

From  time  to  time, various bills are introduced in the United States Congress
with  respect  to  the  regulation  of financial institutions.  Certain of these
proposals,  if  adopted,  could significantly change the regulation of banks and
the  financial  services  industry.  We  cannot  predict  whether  any  of these
proposals  will  be adopted or, if adopted, how these proposals would affect us.

RECENT ACCOUNTING PRONOUNCEMENTS
--------------------------------

Accounting  standards  that  have  been  issued  or  proposed  by  the Financial
Accounting  Standards Board that do not require adoption until a future date are
not  expected to have a material impact on the consolidated financial statements
upon  adoption.


                                      -13-
<PAGE>
                           PART II.  OTHER INFORMATION


ITEM  1.     LEGAL  PROCEEDINGS

     There  are  no  material, pending legal proceedings to which the Company or
any  of  its  subsidiaries  is  a party or of which any of their property is the
subject.

ITEM  2.     CHANGES  IN  SECURITIES

     (a)  Not applicable.
     (b)  Not applicable.
     (c)  Not applicable.
     (d)  Not applicable.

ITEM  3.     DEFAULTS  UPON  SENIOR  SECURITIES

          Not applicable.

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

          None.

ITEM  5.     OTHER  INFORMATION

          None

ITEM  6.     EXHIBITS  AND  REPORTS  ON  FORM  8-K

     (a)  Exhibits:
          99.1  Certification of Messrs. Burnette and Roberts pursuant to 18
                U.S.C. Sec. 1350

     (b)  Reports on Form 8-K
          None


                                      -14-
<PAGE>
                                   SIGNATURES


     Pursuant  to  the  requirements of the Securities Exchange Act of 1934, the
Registrant  has  duly  caused  this  Report  to  be  signed on its behalf by the
undersigned,  thereunto  duly  authorized.

          CHEROKEE  BANKING  COMPANY




Date: August 13, 2002        By: /S/  DENNIS  W.  BURNETTE
                                ------------------------------------------------
                                 Dennis  W.  Burnette
                                 President, Chief Executive Officer and Director




Date: August 13, 2002        By: /S/  A.R.  ROBERTS,  III
                                ------------------------------------------------
                                 A.R.  Roberts,  III
                                 Chief  Financial  Officer,  Chief  Operations
                                 Officer  and  Director


                                      -15-
<PAGE>
                                  EXHIBIT INDEX

Exhibit No.        Description
-----------        -----------

99.1               Certification of Messrs. Burnette and Roberts pursuant to 18
                   U.S.C. Sec. 1350


                                      -16-
<PAGE>