<PAGE>

                      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, 2000

                                      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)
<TABLE>
<CAPTION>

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

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

</TABLE>


                                 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 November 9, 2000.

   Transitional Small Business Disclosure Format (check one):  YES __  NO XX
                                                                          --
<PAGE>

                           CHEROKEE BANKING COMPANY

                                     INDEX
<TABLE>
<CAPTION>

                                                                                   Page No.
                                                                                   --------
<S>           <C>                                                                  <C>

PART I        FINANCIAL INFORMATION

   Item 1.    Financial Statements                                                    3

              Consolidated Balance Sheet (unaudited) at September 30, 2000            3

              Consolidated Statements of Operations (unaudited) for the
              Three Months and the Nine Months Ended September 30, 2000 and 1999      4

              Consolidated Statements of Comprehensive Income (unaudited)
              for the Nine Months Ended September 30, 2000 and 1999                   5

              Consolidated Statements of Cash Flows (unaudited)
              for the Nine Months Ended September 30, 2000 and 1999                   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

</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

                           CHEROKEE BANKING COMPANY

                          Consolidated Balance Sheet

                              September 30, 2000
                                  (Unaudited)

                                    Assets
                                    ------

Cash and due from banks                                             $   732,466
Federal funds sold                                                    5,810,000
                                                                    -----------

     Cash and cash equivalents                                        6,542,466

Interest bearing deposits                                             1,779,000
Investment securities available for sale                             13,990,586
Other investments                                                       236,100
Loans, net                                                           17,106,840
Premises and equipment, net                                           2,485,898
Accrued interest receivable and other assets                            408,221
                                                                    -----------

                                                                    $42,549,111
                                                                    ===========


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

Liabilities:
   Deposits:
     Demand                                                         $ 4,883,881
     Money market and NOW accounts                                   12,679,812
     Savings                                                            577,003
     Time                                                            17,718,125
                                                                    -----------

     Total deposits                                                  35,858,821

   Accrued interest payable and other liabilities                       429,990
                                                                    -----------

     Total liabilities                                               36,288,811
                                                                    -----------

Stockholders' equity:
   Common stock, no par value; authorized
     10,000,000 shares; 738,658 issued and outstanding                7,330,505
   Accumulated deficit                                               (1,031,697)
   Unrealized loss on securities available for sale, net of tax         (38,508)
                                                                    -----------

     Total stockholders' equity                                       6,260,300
                                                                    -----------

                                                                    $42,549,111
                                                                    ===========




See accompanying notes to consolidated financial statements.

                                      -3-
<PAGE>

                           CHEROKEE BANKING COMPANY

                     Consolidated Statements of Operations

  For the Three Months and the Nine Months Ended September 30, 2000 and 1999
                                  (Unaudited)
<TABLE>
<CAPTION>


                                                          Three Months            Nine Months
                                                       Ended September 30     Ended September 30
                                                      ---------------------  ---------------------
                                                         2000       1999        2000       1999
                                                      --------     --------  ---------   ---------
<S>                                                   <C>         <C>        <C>         <C>
Interest income:
     Interest and fees on loans                        $362,114      8,557     758,728      8,557
     Interest on federal funds sold                     113,661     79,618     263,475     79,618
     Investment securities                              236,127     35,352     541,747     35,352
     Escrowed stock subscriptions                                    3,683                 52,927
     Interest on deposits with other banks               31,311          -      51,821          -
                                                       --------   --------   ---------   --------

     Total interest income                              743,213    127,210   1,615,771    176,454
                                                       --------   --------   ---------   --------

Interest expense:
     Deposits                                           432,810     37,401     899,064     37,401
     Other borrowed money                                     -          -           -      6,762
                                                       --------   --------   ---------   --------

     Total interest expense                             432,810     37,401     899,064     44,163
                                                       --------   --------   ---------   --------

     Net interest income                                310,403     89,809     716,707    132,291

Provision for loan losses                                57,171     17,505     149,269     17,505
                                                       --------   --------   ---------   --------
     Net interest income after provision
      for loan losses                                   253,232     72,304     567,438    114,786
                                                       --------   --------   ---------   --------

Other income:
     Service charges on deposit accounts                 26,383          -      47,309          -
     Other operating income                              34,489        602      57,721        602
                                                       --------   --------   ---------   --------
          Total other income                             60,872        602     105,030        602
                                                       --------   --------   ---------   --------

Other expense:
     Salaries and other personnel expense               206,294    121,372     580,847    216,679
     Net occupancy and equipment expense                 52,404     30,342     152,422     48,138
     Other operating expense                            139,657    145,378     386,413    249,394
                                                       --------   --------   ---------   --------

          Total other expense                           398,355    297,092   1,119,682    514,211
                                                       --------   --------   ---------   --------

          Net earnings (loss)                          $(84,251)  (224,186)   (447,214)  (398,823)
                                                       ========   =========  =========   ========

Loss per common share based on average outstanding
  shares of 738,658 in 2000 and 1999:
     Net loss per share                                $  (0.11)     (0.30)      (0.61)     (0.54)
                                                       ========   ========   =========   ========

</TABLE>


See accompanying notes to consolidated financial statements.

                                      -4-
<PAGE>

                           CHEROKEE BANKING COMPANY

                Consolidated Statements of Comprehensive Income

             For the Nine Months Ended September 30, 2000 and 1999
                                  (Unaudited)
<TABLE>
<CAPTION>


                                                               2000       1999
                                                            ---------   --------
<S>                                                         <C>         <C>
Net loss                                                    $(447,214)  (398,823)
                                                            ---------   --------
Other comprehensive income:
 Unrealized holding losses on investment
   securities available for sale                               (9,074)   (25,285)
 Less income tax benefit related to investment
   securities available for sale                                3,447      9,608
                                                            ---------   --------

     Total other comprehensive income (loss), net of tax       (5,627)   (15,677)
                                                            ---------   --------


   Total comprehensive income (loss)                        $(452,841)  (414,500)
                                                            =========   ========

</TABLE>


See accompanying notes to consolidated financial statements.

                                      -5-
<PAGE>

                           CHEROKEE BANKING COMPANY

                     Consolidated Statements of Cash Flows

             For the Nine Months Ended September 30, 2000 and 1999
                                  (Unaudited)
<TABLE>
<CAPTION>


                                                                                 2000          1999
                                                                            ------------    ----------
<S>                                                                         <C>             <C>
Cash flows from operating activities:
  Net loss                                                                  $   (447,214)    (398,823)
  Adjustments to reconcile net loss to net cash
   provided by operating activities:
     Provision for loan losses                                                   149,269       17,505
     Depreciation, amortization and accretion                                     68,595        9,873
     Gain on paydowns and calls of securities                                    (10,839)           -
     Change in:
       Accrued interest receivable and other assets                             (258,334)    (107,967)
       Accrued interest payable and other liabilities                            323,048       28,125
                                                                            ------------   ----------

        Net cash used by operating activities                                   (175,475)    (451,287)
                                                                            ------------   ----------

Cash flows from investing activities:
  Proceeds from sales, maturities and paydowns
   of investment securities available for sale                                   728,097            -
  Purchases of investment securities available for sale                       (7,839,920)  (4,734,707)
  Net change in interest bearing deposits                                     (1,579,000)           -
  Net change in other investments                                                (56,100)           -
  Change in loans                                                            (11,831,694)  (1,400,423)
  Purchase of premises and equipment                                          (1,293,798)    (731,473)
  Proceeds from sale of premises and equipment                                       662            -
                                                                            ------------   ----------

        Net cash used by investing activities                                (21,871,753)  (6,866,603)
                                                                            ------------   ----------

Cash flows from financing activities:
  Net change in deposits                                                      23,862,752    6,453,098
  Repayment of credit line                                                                    (60,000)
  Sale of common stock                                                                 -    7,386,580
                                                                            ------------   ----------

        Net cash provided by financing activities                             23,862,752   13,779,678
                                                                            ------------   ----------

Net change in cash and cash equivalents                                        1,815,524    6,461,788

Cash and cash equivalents at beginning of the period                           4,726,942        9,596
                                                                            ------------   ----------

Cash and cash equivalents at end of the period                              $  6,542,466    6,471,384
                                                                            ============   ==========

Noncash investing activities:
  Change in unrealized loss on securities available for sale, net of tax    $     (5,627)     (15,677)

Supplemental cash flow information:
  Cash paid for interest                                                    $    583,153            -

</TABLE>


See accompanying notes to consolidated financial statements.

                                      -6-
<PAGE>

                            CHEROKEE BANKING COMPANY

                  Notes to Consolidated Financial Statements


(1)  Organization
     ------------

     Cherokee Banking Company (the Company), a bank holding company, owns 100%
     of the outstanding common stock of Cherokee Bank, N.A. (the Bank), which
     operates in the Canton, Georgia area. Prior to the Bank opening for
     business on July 26, 1999, the activities of the Company were devoted
     solely to securing banking facilities, raising capital and procuring
     management and other personnel.

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

     The interim financial statements included herein are unaudited but reflect
     all adjustments which, in the opinion of management, are necessary for a
     fair presentation of the financial position and results of operations for
     the interim period presented. All such adjustments are of a normal
     recurring nature. The results of operations for the period ended September
     30, 2000 are not necessarily indicative of the results of a full year's
     operations.

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

                                      -7-
<PAGE>

Item 2.

                           CHEROKEE BANKING COMPANY

          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS

             For the Nine Months Ended September 30, 2000 and 1999

Financial Condition

     Total assets at September 30, 2000 were $42,549,111 representing a
$23,732,959 (126%) increase from December 31, 1999. Deposits increased
$23,862,752 (199%) from December 31, 1999. Net loans outstanding increased
$11,682,425 (215%) over year-end 1999. The allowance for loan losses at
September 30, 2000 totaled $216,543, representing 1.25% of total loans at
September 30, 2000 compared to the December 31, 1999 total of $68,663, which
represented 1.25% of total loans. Cash and cash equivalents at September 30,
2000 increased $1,815,524 from December 31, 1999.

     There were no loans which were considered nonperforming at September 30,
2000.

Results of Operations

     For the nine months ended September 30, 2000, the Bank's annualized yield
on earning assets was 6.98%. The cost of funding sources for the nine month
period ended September 30, 2000 was 4.55%. While the Bank's net interest spread
was 2.44%, the net interest margin, which considers the effect of non-interest
bearing deposits, was 3.10%.

     For the nine months ended September 30, 2000, interest income was
$1,616,000, primarily from loans ($759,000) and investment securities
($542,000). Interest expense of $899,000 related to the Bank's deposits.

     The Bank provided $149,000 for potential loan losses for the nine months
ended September 30, 2000 in management's efforts to maintain the allowance for
loan losses at an appropriate level.

     Other expense of $1,120,000 was primarily made up of salaries and employee
costs of $581,000 and other operating expense of $386,000.

Capital

     The following tables present Cherokee Banking Company's regulatory capital
position at September 30, 2000:

     Risk-Based Capital Ratios
     -------------------------

     Tier 1 Tangible Capital, Actual                   20.55%
     Tier 1 Tangible Capital minimum requirement        4.00%
                                                       -----

     Excess                                            16.55%
                                                       =====

     Total Capital, Actual                             21.45%
     Total Capital minimum requirement                  8.00%
                                                       -----

     Excess                                            13.45%
                                                       =====


     Leverage Ratio
     --------------

     Tier 1 Tangible Capital to adjusted total assets
      ("Leverage Ratio")                               12.45%
     Minimum leverage requirement                       4.00%
                                                       -----

     Excess                                             8.45%
                                                       =====

                                      -8-
<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:
         The following documents are incorporated by reference and made a part
         of this report.

         Exhibit
         Number     Exhibit
         -------    -------

           3.1      Articles of Incorporation (incorporated herein by reference
                    to exhibit 3.1 to the Company's Registration Statement on
                    Form SB-2, as amended, Registration No. 333-71571)

           3.2      Bylaws (incorporated herein by reference to exhibit 3.2 to
                    the Company's Registration Statement on Form SB-2, as
                    amended, Registration No. 333-71571)

           4.1      Instruments Defining the Rights of Security Holders. See
                    Articles of Incorporation at Exhibit 3.1 hereto and Bylaws
                    at Exhibit 3.2 hereto

           10.1     Purchase and Sale Agreement (main office property), dated
                    December 11, 1998 (incorporated herein by reference to
                    exhibit 10.1 to the Company's Registration Statement on Form
                    SB-2, as amended, Registration No. 333-71571)

           10.2*    Employment Agreement, dated as of January 1, 1999, among
                    Cherokee Bank, N.A., Cherokee Banking Company and Dennis W.
                    Burnette (incorporated herein by reference to exhibit 10.3
                    to the Company's Registration Statement on Form SB-2, as
                    amended, Registration No. 333-71571)

           10.3     Form of Cherokee Banking Company Organizers' Warrant
                    Agreement (incorporated herein by reference to exhibit 10.5
                    to the Company's Registration Statement on Form SB-2, as
                    amended, Registration No. 333-71571)

           10.4     Escrow Agreement, dated as of April 1, 1999, among Cherokee
                    Banking Company and The Bankers Bank (incorporated herein by
                    reference to exhibit 10.6 to the Company's Registration
                    Statement on Form SB-2, as amended, Registration No. 333-
                    71571)

                                      -9-
<PAGE>

           10.5     Construction Agreement dated September 29, 1999 by and
                    between Cherokee Banking Company, Inc. and W. H. Bass, Inc.
                    (incorporated herein by reference to exhibit 10.5 to the
                    Company's Form 10-KSB filed on March 27, 2000)

           27.1     Financial Data Schedule (for SEC purposes only)
___________________________________
*  Compensatory plan or arrangement.


     (b)  Reports on Form 8-K
          None

                                      -10-
<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 10, 2000           By:  /s/ Dennis W. Burnette
     ------------------------            --------------------------------------
                                         Dennis W. Burnette
                                         President, Chief Executive Officer
                                         and Director



Date:   November 10, 2000           By:  /s/ A.R. Roberts
     ------------------------            --------------------------------------
                                         A.R. Roberts, III
                                         Chief Financial Officer, Chief
                                         Operations Officer and Director

                                      -11-