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 September 30, 2002

                                       OR

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

                For the Transition Period from ______ to ______

                       Commission file 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                                           (Zip Code)
    executive 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   X     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 November 11, 2002.

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


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

                                          INDEX

                                                                                Page No.
                                                                                --------
<S>        <C>                                                                        <C>
PART I     FINANCIAL INFORMATION

  Item 1.  Financial Statements                                                        3

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

           Consolidated Statements of Earnings (unaudited) for the Three Months
             and the Nine Months Ended September 30, 2002 and 2001                     4


           Consolidated Statements of Comprehensive Income (unaudited) for the Nine
             Months Ended September 30, 2002 and 2001                                  5


           Consolidated Statements of Cash Flows (unaudited) for the Nine
             Months Ended September 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                                                     9


  Item 3.  Controls and Procedures                                                    15


PART II.   OTHER INFORMATION

  Item 1.  Legal Proceedings                                                          15

  Item 2.  Changes in Securities                                                      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 and Reports on Form 8-K                                           15
</TABLE>



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 and
those  factors  discussed in detail in the Company's filings with the Securities
and  Exchange  Commission.


                                      -2-
<PAGE>
                         PART I.  FINANCIAL INFORMATION

Item  1.  Financial  Statements

<TABLE>
<CAPTION>
                            CHEROKEE BANKING COMPANY

                           CONSOLIDATED BALANCE SHEET

                               SEPTEMBER 30, 2002
                                   (UNAUDITED)

                         Assets
                         ------
<S>                                                               <C>
Cash and due from banks                                           $ 2,510,882
Federal funds sold                                                    461,000
                                                                  ------------

   Cash and cash equivalents                                        2,971,882

Interest bearing deposits                                             398,000
Investment securities available-for-sale                           37,217,276
Other investments                                                     654,350
Loans, net                                                         42,663,161
Premises and equipment, net                                         3,730,096
Other assets                                                        1,902,723
                                                                  ------------

                                                                  $89,537,488
                                                                  ============

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

Liabilities:
   Deposits:
     Demand                                                       $ 9,044,284
     Money market and NOW accounts                                 34,849,159
     Savings                                                        2,125,950
     Time                                                          26,741,376
                                                                  ------------

       Total deposits                                              72,760,769

   Other liabilities                                                  733,844
                                                                  ------------

       Total liabilities                                           81,994,613
                                                                  ------------

Stockholders' equity:
     Preferred stock, no par value, 2,000,000 shares authorized,
         no shares issued and outstanding                                   -
     Common stock, no par value; authorized
         10,000,000 shares; 738,658 shares issued and outstanding   7,330,505
     Accumulated deficit                                             (109,270)
     Accumulated other comprehensive income                           321,640
                                                                  ------------

       Total stockholders' equity                                   7,542,875
                                                                  ------------

                                                                  $89,537,488
                                                                  ============
<FN>
See accompanying notes to unaudited consolidated financial statements.
</TABLE>


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

                              CONSOLIDATED STATEMENTS OF EARNINGS

          FOR THE THREE MONTHS AND THE NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
                                          (UNAUDITED)

                                                      Three Months           Nine Months
                                                    Ended September 30     Ended September 30
                                                   ---------------------  --------------------
                                                      2002       2001       2002       2001
                                                   ----------  ---------  ---------  ---------
<S>                                                <C>         <C>        <C>        <C>
Interest income:
 Interest and fees on loans                        $  768,415    678,521  2,203,775  1,882,741
 Investment securities                                398,803    259,424  1,203,307    753,480
 Interest on federal funds sold                        12,033     65,947     32,128    208,919
 Interest on deposits with other banks                  4,977      9,724     21,871     60,622
                                                   ----------  ---------  ---------  ---------

     Total interest income                          1,184,228  1,013,616  3,461,081  2,905,762
                                                   ----------  ---------  ---------  ---------

Interest expense:
 Deposits                                             384,667    467,359  1,156,836  1,329,340
 Other borrowings                                      54,517          -    134,301          -
                                                   ----------  ---------  ---------  ---------

     Total interest expense                           439,184    467,359  1,291,137  1,329,340
                                                   ----------  ---------  ---------  ---------

     Net interest income                              745,044    546,257  2,169,944  1,576,422

Provision for loan losses                              20,060     31,138    135,632    152,602
                                                   ----------  ---------  ---------  ---------

     Net interest income after provision
        for loan losses                               724,984    515,119  2,034,312  1,423,820
                                                   ----------  ---------  ---------  ---------

Other income:
 Service charges on deposit accounts                   91,051     80,677    258,358    215,430
 Other operating income                                57,693     53,566    165,151    157,931
                                                   ----------  ---------  ---------  ---------

     Total other income                               148,744    134,243    423,509    373,361
                                                   ----------  ---------  ---------  ---------

Other expense:
 Salaries and other personnel expense                 401,610    278,850  1,136,764    817,816
 Net occupancy and equipment expense                   83,958     58,107    210,749    181,331
 Other operating expense                              285,723    205,515    780,912    559,021
                                                   ----------  ---------  ---------  ---------

     Total other expense                              771,291    542,472  2,128,425  1,558,168
                                                   ----------  ---------  ---------  ---------

    Earnings before income tax expense                102,437    106,890    329,396    239,013

Income tax expense                                     41,228          -    127,852          -
                                                   ----------  ---------  ---------  ---------

     Net earnings                                  $   61,209    106,890    201,544    239,013
                                                   ==========  =========  =========  =========

Basic earnings per share                           $     0.08       0.14       0.27       0.32
                                                   ==========  =========  =========  =========

Diluted earnings per share                         $     0.08       0.14       0.26       0.32
                                                   ==========  =========  =========  =========
<FN>
See accompanying notes to unaudited consolidated financial statements.
</TABLE>


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

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
                                   (UNAUDITED)


                                                   2002       2001
                                                ----------  ---------
<S>                                             <C>         <C>
Net earnings                                    $ 201,544    239,013
                                                ----------  ---------

Other comprehensive income:
  Unrealized holding gains on investment
    securities available-for-sale                 692,229    280,650
  Income tax expense related to investment
    securities available-for-sale                (262,774)  (106,647)
                                                ----------  ---------

  Total other comprehensive income, net of tax    429,455    174,003
                                                ----------  ---------

  Total comprehensive income                    $ 630,999    413,016
                                                ==========  =========
<FN>
See accompanying notes to unaudited consolidated financial statements.
</TABLE>


                                      -5-
<PAGE>
<TABLE>
<CAPTION>
                                         CHEROKEE BANKING COMPANY

                                   CONSOLIDATED STATEMENTS OF CASH FLOWS

                           FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
                                                (UNAUDITED)

                                                                                   2002           2001
                                                                               -------------  ------------
<S>                                                                            <C>            <C>
Cash flows from operating activities:
  Net income                                                                   $    201,544       239,013
  Adjustments to reconcile net income to net cash
    provided by operating activities:
      Provision for loan losses                                                     135,632       152,602
      Depreciation, amortization and accretion                                      129,960        58,531
      Change in:
        Other assets                                                                (14,008)      (83,242)
        Other liabilities                                                             6,824       307,800
                                                                               -------------  ------------

          Net cash provided by operating activities                                 459,952       674,704
                                                                               -------------  ------------

Cash flows from investing activities:
  Proceeds from maturities and paydowns
    of investment securities investment securities available-for-sale             8,931,073     4,689,956
  Proceeds from sales of investment securities available-for-sale                 1,984,786             -
  Purchases of investment securities available-for-sale                         (18,676,657)  (11,725,996)
  Net change in interest bearing deposits                                           599,000     1,180,000
  Purchases of other investments                                                   (349,100)      (19,800)
  Net change in loans                                                           (12,199,978)   (9,385,980)
  Purchase of bank owned life insurance                                            (785,842)            -
  Purchase of premises and equipment                                               (878,998)     (650,533)
                                                                               -------------  ------------

          Net cash used by investing activities                                 (21,375,716)  (15,912,053)
                                                                               -------------  ------------

Cash flows from financing activities:
  Net change in federal funds purchased                                            (222,000)            -
  Proceeds from FHLB borrowings                                                   8,500,000             -
  Net change in deposits                                                         13,998,023    19,298,236
                                                                               -------------  ------------

          Net cash provided by financing activities                              22,276,023    19,298,236
                                                                               -------------  ------------

Net change in cash and cash equivalents                                           1,360,259     4,060,887

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

Cash and cash equivalents at end of the period                                 $  2,971,882     7,339,523
                                                                               =============  ============

Noncash investing activities:
  Change in unrealized gain/loss on securities available for sale, net of tax  $    429,455       174,003

Supplemental cash flow information:
  Cash paid for interest                                                       $  1,258,706     1,072,841
  Cash paid for income taxes                                                   $     43,436             -
<FN>
See accompanying notes to unaudited consolidated financial statements.
</TABLE>


                                      -6-
<PAGE>
                            CHEROKEE BANKING COMPANY

                   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  September  30, 2002 and for the interim periods ended September 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.


                                      -7-
<PAGE>
                            CHEROKEE BANKING COMPANY

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
                                   (UNAUDITED)

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
nine months ended September 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 nine months ended September 30, 2002 presented in the
financial  statements  were  calculated  as  follows:


                                                  Net     Common   Per Share
For the quarter ended September 30, 2002:      Earnings   Share     Amount
                                               ---------  -------  --------

      Basic earnings per share                 $  61,209  738,658     .08

      Effect of stock options                          -   42,279       -
                                               ---------  -------  --------

      Diluted earnings per share               $  61,209  780,937     .08
                                               =========  =======  ========


                                                 Net      Common   Per Share
For the nine months ended September 30, 2002:  Earnings   Share     Amount
                                               ---------  -------  --------

      Basic earnings per share                 $ 201,544  738,658     .27

      Effect of stock options                          -   42,279    (.01)
                                               ---------  -------  --------

      Diluted earnings per share               $ 201,544  780,937     .26
                                               =========  =======  ========


                                      -8-
<PAGE>
                            CHEROKEE BANKING COMPANY

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 September 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  nine  months  ended  September  30,  2002, net interest income totaled
$2,170,000  as  compared  to  $1,576,000  for the same period in 2001.  Interest
income  from  loans,  including fees increased $321,000 or 17% to $2,204,000 for
the  nine  months ended September 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
4.08%  and  3.96%,  respectively,  for the nine months ended September 30, 2002.

For  the quarter ended September 30, 2002, interest income totaled $1,184,000 as
compared  to $1,014,000 for the same period in 2001.  Interest expense decreased
from  $467,000 for the quarter ended September 30, 2001 to $439,000 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 September 30, 2002,
the  net  interest  margin  was  3.97%  and  the interest rate spread was 3.85%.


                                      -9-
<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 September 30, 2002, the Bank, as measured by
Gap,  is  in  an  asset  sensitive  position.

The  Bank  also measures the actual effects that repricing opportunities have on
earnings  through  simulation  modeling,  referred  to as earnings at risk.  For
short-term  interest rate risk, the Bank's model simulates the impact of balance
sheet  strategies  on  net interest income, pre-tax income, and net income.  The
model  includes  interest  rate  ramps  to test the impact of rising and falling
interest  rates  on projected earnings.  Rates are ramped over a one-year period
and  include  a level rate scenario as the benchmark with rising and falling 200
basis  point scenarios for comparison.  The Bank determines the assumptions that
are  used  in  the  model.

In  addition to measuring the effect changes in rates will have on earnings, the
Bank  also measures the effect of interest rate changes on the economic value of
the Bank.  Economic Value of Equity is measured by calculating the present value
of  future cash flows for financial instruments on the balance sheet.  The model
utilizes  rate  shocks of rising and falling 200 basis points to compare against
the  level  benchmark  for best and worst case scenarios.  All rates are shocked
instantaneously  for  the  200  basis  point  movements.  The  purpose  of  this
measurement  is  to determine the long-term effect interest rate changes have on
the  economic  value  of  the  balance  sheet.

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 $136,000 for the nine months ended
September  30,  2002 as compared to $153,000 for the nine months ended September
30,  2001.  The loan portfolio increased by approximately $12,064,000 during the
nine  months  ended September 30, 2002 as compared to $9,233,000 during the nine
months  ended  September  30,  2001.  The allowance for loan losses was 1.32% of
gross  loans  at  September  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


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

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 nine months ended September 30, 2002 totaled $424,000
as  compared  to  $373,000  for  the  nine  months  ended  September  30,  2001.
Noninterest  income for the quarter ended September 30, 2002 totaled $149,000 as
compared  to $134,000 for the quarter ended September 30, 2001.  The increase in
noninterest income was due to an increase in service charges on deposit accounts
during  2002  as  compared to the same periods in 2001.  The increase in service
charges  was  due  to  the  increase  in  the number of deposit accounts in 2002
compared  to  2001.

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

On  July  1,  2002,  the Bank opened its second branch location.  The opening of
this  branch  contributed  to  the  increase in noninterest expenses during 2002
compared  to  2001 and is expected to better serve the Bank's existing customers
and  to  attract  new  customers.

Total  noninterest  expense  for  the  nine  months ended September 30, 2002 was
$2,128,000  as compared to $1,558,000 for the same period in 2001.  Salaries and
benefits,  the  largest component of noninterest expense, totaled $1,137,000 for
the  nine  months  ended  September  30, 2002, compared to $818,000 for the same
period  a  year  ago. Salary and benefits expense increased due to the hiring of
additional  employees.   Other  operating  expenses  were  $781,000 for the nine
months  ended  September  30,  2002  as compared to $559,000 for the nine months
ended  September  30,  2001.  These increases in noninterest expenses are due to
the  continued  growth  of  the  Bank.

Total  noninterest expense for the quarter ended September 30, 2002 was $771,000
as  compared  to  $542,000  for  the same period in 2001.  Salaries and benefits
totaled  $402,000 for the quarter ended September 30, 2002, compared to $279,000
for the same period a year ago. Salary and benefits expense increased due to the
hiring of additional employees.   Other operating expenses were $286,000 for the
quarter  ended  September 30, 2002 as compared to $206,000 for the quarter ended
September  30,  2001.  These  increases  in  noninterest expenses are due to the
continued  growth  of  the  Bank.

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

The income tax expense for the nine months ended September 30, 2002 was $128,000
and was $41,000 for the quarter ended September 30, 2002. The Company recognized
no  income  tax  expense  or  benefit  during  the quarter and nine months ended
September  30,  2001  due  to  the  fact  that  it  had  a  net  operating  loss
carryforward.  The  effective  tax  rate was 38% for the quarter and nine months
ended  September  30,  2002.

NET  EARNINGS  (LOSS)
---------------------

The  combination  of  the above factors resulted in net earnings of $202,000 for
the  nine  months  ended  September  30,  2002 compared to $239,000 for the nine
months  ended  September  30,  2001.   Basic earnings per share was $.27 for the
nine  months  ended  September  30, 2002 compared to $.32 for the same period in
2001.  Net  earnings  were  $61,000  for  the  quarter  ended September 30, 2002
compared  to  $107,000  for  the  same  period  in  2001.

Diluted  earnings  per  share  were $.26 for the nine months ended September 30,
2002  compared to diluted earnings per share of $.32 in the same period in 2001.
The  dilutive  effect of the Company's outstanding options and warrants was $.01
per  share  during  the  nine  months  ended  September 30, 2002.  The Company's
options  and warrants had no dilutive effect in the quarters ended September 30,
2002  and  2001  or  the  nine  months  ended  September  30,  2001.


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

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

During the first nine months of 2002, total assets increased $23,177,000 or 35%,
when  compared  to December 31, 2001. The primary source of growth in assets was
net  loans,  which  increased $12,064,000 or 39% during the first nine months of
2002.  Investment  securities  available-for-sale  increased  $8,454,000  from
December  31,  2001  to  $37,217,000  at  September  30,  2002.  Total  deposits
increased  $13,998,000 or 24%, from the December 31, 2001 amount of $58,763,000.

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

Investment  securities  available-for-sale increased $8,454,000 from $28,763,000
at December 31, 2001 to $37,217,000 at September 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
September  30,  2002.

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

Premises and equipment, net of depreciation, totaled $3,730,000 at September 30,
2002.  The  increase of $749,000 from the December 31, 2001 amount of $2,981,000
was  primarily  due  to  additions related to the Bank's second branch location.

LOANS
-----

Gross  loans  totaled  $43,232,000  at  September  30,  2002,  an  increase  of
$12,205,000  or  39% since December 31, 2001.  The largest increase in loans was
in  commercial  and  industrial  loans,  which  increased  $5,129,000  or 31% to
$21,424,000  at  September 30, 2002.  Balances within the major loans receivable
categories  as  of  September  30,  2002  and  December 31, 2001 are as follows:

                             September 30,
                             --------------
                                  2002       December 31, 2001
                             --------------  -----------------
 Real estate - construction  $    9,903,022          4,214,108
 Real estate - mortgage           7,880,423          6,435,719
 Commercial and industrial       21,423,687         16,294,606
 Consumer and other               4,025,323          4,082,555
                             --------------  -----------------

                             $   43,232,455         31,026,988
                             ==============  =================


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

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

<TABLE>
<CAPTION>
                                                     September 30,
                                                     --------------
                                                          2002       December 31, 2001
                                                     --------------  -----------------
<S>                                                  <C>             <C>
Loans: Nonaccrual loans                              $      192,784              4,000

Accruing loans more than 90 days past due            $            -                  -

Loans identified by the internal review mechanism:

    Criticized                                       $      456,361            655,923

    Classified                                       $      192,784            197,650
</TABLE>


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

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

Balance, January 1,                                   $     428,173

Provision for loan losses for the period                    135,632

Net loans (charged off) recovered for the period              5,489
                                                      --------------

Balance, end of period                                $     569,294
                                                      ==============

Gross loans outstanding, end of period                $  43,232,455
                                                      ==============

Allowance for loan losses to gross loans outstanding           1.32%


DEPOSITS
--------

At  September  30,  2002  total  deposits  increased by $13,998,000, or 24% from
December 31, 2001.   Noninterest-bearing demand deposits increased $3,423,000 or
61%  and  interest-bearing  deposits  increased  $7,754,000  or  15%.

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

<TABLE>
<CAPTION>
                                           September 30,
                                           --------------
                                                2002       December 31, 2001
                                           --------------  -----------------
<S>                                        <C>             <C>
Noninterest-bearing demand deposits        $    9,044,284          5,620,933
Interest-bearing demand deposits               34,849,159         27,993,680
Savings deposits                                2,125,950          1,541,472
Certificates of deposit $100,000 and over       7,396,797          4,398,173
Other time deposits                            19,344,579         19,208,488
                                           --------------  -----------------

                                           $   72,760,769         58,762,746
                                           ==============  =================
</TABLE>


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
53%  at  September  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.


                                      -13-
<PAGE>
ITEM  2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
--------------------------------------------------------------------------------
OF  OPERATIONS,  CONTINUED
--------------------------

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

     Commitments to extend credit                   $7,760,000
     Standby letters of credit                      $   70,000

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 September 30, 2002, unused lines of credit totaled
$5,000,000.

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

Total  shareholders'  equity  increased  from $6,912,000 at December 31, 2001 to
$7,543,000  at  September  30,  2002.  This  increase  was  attributable  to net
earnings  for  the  period  and  an  increase  of  $429,000 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 September
30,  2002:

     Tier 1 capital (to risk-weighted assets)              11.87%
     Total capital (to risk-weighted assets)               12.90%
     Tier 1 capital (to total average assets)               7.92%

As  of  September  30,  2002,  the holding company had approximately $567,000 in
unencumbered  cash  that  could  be  contributed  to the Bank if necessary.  The
Bank's  capital  ratios listed above would improve 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.


                                      -14-
<PAGE>
ITEM  3.  CONTROLS  AND  PROCEDURES
-----------------------------------

Within  90  days  prior  to  the date of this report, the Company carried out an
evaluation,  under  the  supervision and with the participation of the Company's
management,  including the Company's Chief Executive Officer and Chief Financial
Officer,  of  the  effectiveness  of  the  design and operation of the Company's
disclosure  controls and procedures pursuant to Exchange Act Rule 13a-14.  Based
upon  that evaluation, the Company's Chief Executive Officer and Chief Financial
Officer  concluded  that  the  Company's  disclosure controls and procedures are
effective  in  timely  alerting  them  to  material  information relating to the
Company  (including  its  consolidated  subsidiaries)  that  is  required  to be
included  in  the  Company's  periodic  filings with the Securities and Exchange
Commission.  There  have  been  no significant changes in the Company's internal
controls  or,  to  the  Company's  knowledge,  in  other  factors  that  could
significantly  affect those internal controls subsequent to the date the Company
carried  out  its  evaluation,  and  there  have been no corrective actions with
respect  to  significant  deficiencies  or  material  weaknesses.

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  CEO  and  CFO  certifications  pursuant  to  Section  906 of the
          Sarbanes-Oxley  Act  of  2002.

     (b)  Reports  on  Form  8-K:
          None.


                                      -15-
<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: November 11, 2002          By: /S/  DENNIS  W.  BURNETTE
           -----------------              -------------------------------------
                                          Dennis  W.  Burnette
                                          President, Chief Executive Officer
                                          and Director



     Date: November 11, 2002          By: /S/  A.R.  ROBERTS,  III
           -----------------              -------------------------------------
                                          A.R.  Roberts,  III
                                          Chief Financial Officer,
                                          Chief Operations Officer and Director


                                      -16-
<PAGE>
                                  Certification

I,  Dennis  W.  Burnette,  certify  that:

1.   I  have  reviewed  this  quarterly  report on Form 10-Q of Cherokee Banking
     Company;

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

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

4.   The  registrant's  other  certifying  officers  and  I  are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in  Exchange  Act  Rules 13a-14 and 15d-14) for the registrant and we have:

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

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

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

5.   The  registrant's  other certifying officers and I have disclosed, based on
     our  most  recent  evaluation,  to  the registrant's auditors and the audit
     committee  of  registrant's  board  of directors (or persons performing the
     equivalent  function):

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

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

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly  report whether or not there were significant changes in internal
     controls  or  in  other  factors  that  could significantly affect internal
     controls  subsequent  to  the date of our most recent evaluation, including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Date:  November 11, 2002


     /s/  Dennis  W.  Burnette
     -------------------------
     Chief  Executive  Officer


                                      -17-
<PAGE>
                                  Certification


I,  A.  R.  Roberts,  III,  certify  that:

1.   I  have  reviewed  this  quarterly  report on Form 10-Q of Cherokee Banking
     Company;

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

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

4.   The  registrant's  other  certifying  officers  and  I  are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in  Exchange  Act  Rules 13a-14 and 15d-14) for the registrant and we have:

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

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

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

5.   The  registrant's  other certifying officers and I have disclosed, based on
     our  most  recent  evaluation,  to  the registrant's auditors and the audit
     committee  of  registrant's  board  of directors (or persons performing the
     equivalent  function):

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

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

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly  report whether or not there were significant changes in internal
     controls  or  in  other  factors  that  could significantly affect internal
     controls  subsequent  to  the date of our most recent evaluation, including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Date: November 11, 2002


     /s/  A.  R.  Roberts,  III
     --------------------------
     Chief  Financial  Officer


                                      -18-
<PAGE>