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

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

| Large      Accelerated Filer  o | Accelerated      Filer  o         |
|--------------------------------------|----------------------------------------|
| Non-Accelerated      Filer  o   | Smaller      Reporting Company  x |

----

|                                |          |                                                                                                                                             | Page No. |
|-------------------------------------|---------------|--------------------------------------------------------------------------------------------------------------------------------------------------|----------|
| PART      I - FINANCIAL INFORMATION |          |
|                                |          |                                                                                                                                             |     |
|                                | Item      1.  | Financial      Statements                                                                                                                        |     |
|                                |          |                                                                                                                                             |     |
|                                |          | Consolidated      Balance Sheets at September 30, 2008 and December 31, 2007                                                                     | 11       |
|                                |          |                                                                                                                                             |     |
|                                |          | Consolidated      Statements of Earnings (unaudited) for the Three Months and the Nine      Months Ended September 30, 2008 and 2007             | 2        |
|                                |          |                                                                                                                                             |     |
|                                |          | Consolidated      Statements of Comprehensive Income (unaudited) for the Three Months and      the Nine Months Ended September 30, 2008 and 2007 | 3        |
|                                |          |                                                                                                                                             |     |
|                                |          | Consolidated      Statements of Cash Flows (unaudited) for the Nine Months Ended September      30, 2008 and 2007                                | 4        |
|                                |          |                                                                                                                                             |     |
|                                |          | Notes      to Consolidated Financial Statements (unaudited)                                                                                      | 6        |
|                                |          |                                                                                                                                             |     |
|                                | Item      2.  | Management’s      Discussion and Analysis of Financial Condition and Results of      Operations                                            | 9        |
|                                |          |                                                                                                                                             |     |
|                                | Item      3.  | Quantitative      and Qualitative Disclosures about Market Risk                                                                                  | 13       |
|                                |          |                                                                                                                                             |     |
|                                | Item      4.  | Controls      and Procedures                                                                                                                     | 13       |
|                                |          |                                                                                                                                             |     |
| PART      II - OTHER INFORMATION    |          |
|                                |          |                                                                                                                                             |     |
|                                | Item      1.  | Legal      Proceedings                                                                                                                           | 14       |
|                                |          |                                                                                                                                             |     |
|                                | Item      1A. | Risk      Factors                                                                                                                                | 14       |
|                                |          |                                                                                                                                             |     |
|                                | Item      2.  | Unregistered      Sales of Equity Securities and Use of Proceeds                                                                                 | 14       |
|                                |          |                                                                                                                                             |     |
|                                | Item      3.  | Defaults      Upon Senior Securities                                                                                                             | 14       |
|                                |          |                                                                                                                                             |     |
|                                | Item      4.  | Submission      of Matters to a Vote of Security Holders                                                                                         | 14       |
|                                |          |                                                                                                                                             |     |
|                                | Item      5.  | Other      Information                                                                                                                           | 14       |
|                                |          |                                                                                                                                             |     |
|                                | Item      6.  | Exhibits                                                                                                                                         | 14       |

----

|                                                                                                                                                                    |   | September      30, 2008(unaudited) |        |   | December      31, 2007 |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------|-------------|--------|------------------------|--------|
| Assets                                                                                                                                                                  |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |
| Cash      and due from banks, including reserve requirements of    $25,000                                                                                              |   | $                                  | 5,501,220   |   |                   |   | 5,365,937 |   |
| Federal      funds sold                                                                                                                                                 |   |                               | 18,016,000  |   |                   |   | 15,524,000 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
|                    Cash      and cash equivalents                        |   |                               | 23,517,220  |   |                   |   | 20,889,937 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
| Investment      securities available for sale                                                                                                                           |   |                               | 79,231,645  |   |                   |   | 91,434,194 |   |
| Other      investments                                                                                                                                                  |   |                               | 679,229     |   |                   |   | 706,729 |   |
| Mortgage      loans held for sale                                                                                                                                       |   |                               | 526,196     |   |                   |   | 1,063,183 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
| Loans,      net of allowance for loan losses of $3,832,581 and    $3,335,825                                                                                            |   |                               | 194,169,537 |   |                   |   | 196,495,440 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
| Premises      and equipment, net                                                                                                                                        |   |                               | 7,047,620   |   |                   |   | 7,394,096 |   |
| Accrued      interest receivable and other assets                                                                                                                       |   |                               | 3,584,530   |   |                   |   | 3,329,403 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
|                    Total      assets                                     |   | $                                  | 308,755,977 |   |                   |   | 321,312,982 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
| Liabilities and      Stockholders’ Equity                                                                                                                         |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
| Liabilities:                                                                                                                                                            |   |                               |        |   |                   |   |   |   |
|        Deposits                                                                                                                      |   |                               |        |   |                   |   |   |   |
|             Noninterest-bearing                                                                             |   | $                                  | 29,565,605  |   |                   |   | 31,544,102 |   |
|             Interest-bearing                                                                                |   |                               | 236,533,994 |   |                   |   | 254,980,466 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
|                    Total      deposits                                   |   |                               | 266,099,599 |   |                   |   | 286,524,568 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
|        Securities      sold under repurchase agreements                                                                              |   |                               | 11,960,085  |   |                   |   | 3,156,300 |   |
|        Accrued      interest payable and other liabilities                                                                           |   |                               | 715,257     |   |                   |   | 2,297,382 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
|                    Total      liabilities                                |   |                               | 278,774,941 |   |                   |   | 291,978,250 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
| Stockholders’      equity:                                                                                                                                        |   |                               |        |   |                   |   |   |   |
|        Common      stock, $2 par value;                                                                                              |   |                               |        |   |                   |   |   |   |
|              authorized      1,500,000 shares;                                                         |   |                               |        |   |                   |   |   |   |
|              issued      and outstanding 899,815 shares                                                |   |                               | 1,799,630   |   |                   |   | 1,799,630 |   |
|        Additional      paid-in capital                                                                                               |   |                               | 4,243,332   |   |                   |   | 4,243,332 |   |
|        Retained      earnings                                                                                                        |   |                               | 23,870,183  |   |                   |   | 22,927,131 |   |
|        Accumulated      other comprehensive income                                                                                   |   |                               | 67,891      |   |                   |   | 364,639 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
|                    Total      stockholders’ equity                 |   |                               | 29,981,036  |   |                   |   | 29,334,732 |   |
|                                                                                                                                                                    |   |                               |        |   |                   |   |   |   |
|                    Total      liabilities and stockholders’ equity |   | $                                  | 308,755,977 |   |                   |   | 321,312,982 |   |

----

|                                                                                                                                         |   | Three      Months Ended |      |   | Nine      Months Ended |   |
|----------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------|-----------|--------|------------------------|--------|
|                                                                                                                                         |   | 2008                    |      |   | 2007                   |   |   | 2008 |   |   | 2007 |   |
| Interest      Income:                                                                                                                        |   |                    |      |   |                   |   |   |   |   |   |   |   |
|           Loans                                                                                                          |   | $                       | 2,751,772 |   |                   |   | 4,306,863 |   |   |   | 9,088,741 |   |   |   | 13,285,760 |   |
|           Investment securities:                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|         Tax      exempt                                                                              |   |                    | 197,037   |   |                   |   | 239,446 |   |   |   | 648,964 |   |   |   | 712,994 |   |
|         Taxable                                                                                      |   |                    | 867,770   |   |                   |   | 999,993 |   |   |   | 2,761,744 |   |   |   | 2,850,787 |   |
|           Federal funds sold and other                                                                                   |   |                    | 48,431    |   |                   |   | 181,707 |   |   |   | 277,840 |   |   |   | 389,591 |   |
|                 Total interest income                                                      |   |                    | 3,865,010 |   |                   |   | 5,728,009 |   |   |   | 12,777,289 |   |   |   | 17,239,132 |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Interest      Expense:                                                                                                                       |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|           Deposits                                                                                                       |   |                    | 1,728,579 |   |                   |   | 2,807,179 |   |   |   | 6,201,210 |   |   |   | 8,331,621 |   |
|           Other                                                                                                          |   |                    | 72,746    |   |                   |   | 21,192 |   |   |   | 103,385 |   |   |   | 55,766 |   |
|                 Total interest expense                                                     |   |                    | 1,801,325 |   |                   |   | 2,828,371 |   |   |   | 6,304,595 |   |   |   | 8,387,387 |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|                 Net interest income                                                        |   |                    | 2,063,685 |   |                   |   | 2,899,638 |   |   |   | 6,472,694 |   |   |   | 8,851,745 |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Provision      for loan losses                                                                                                               |   |                    | 368,000   |   |                   |   | - |   |   |   | 598,000 |   |   |   | 80,000 |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|               Net      interest income after provision for loan losses |   |                    | 1,695,685 |   |                   |   | 2,899,638 |   |   |   | 5,874,694 |   |   |   | 8,771,745 |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Other      Income:                                                                                                                           |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|           Service charges on deposit accounts                                                                            |   |                    | 398,774   |   |                   |   | 384,017 |   |   |   | 1,150,663 |   |   |   | 1,129,388 |   |
|      Mortgage      origination fees                                                                                 |   |                    | 104,205   |   |                   |   | 113,210 |   |   |   | 263,378 |   |   |   | 330,865 |   |
|      Securities      gains, net                                                                                     |   |                    | -         |   |                   |   | - |   |   |   | 197,264 |   |   |   | - |   |
|      Losses      on sales of other real estate owned                                                                |   |                    | -         |   |                   |   | (25,758 | ) |   |   | - |   |   |   | (25,758 | ) |
|           Other operating income                                                                                         |   |                    | 200,904   |   |                   |   | 186,695 |   |   |   | 670,704 |   |   |   | 617,132 |   |
|                 Total other income                                                         |   |                    | 703,883   |   |                   |   | 658,164 |   |   |   | 2,282,009 |   |   |   | 2,051,627 |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|  Other      Expense:                                                                                                                    |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|           Salaries and other personnel expense                                                                           |   |                    | 1,087,865 |   |                   |   | 1,420,778 |   |   |   | 4,013,963 |   |   |   | 4,367,459 |   |
|           Net occupancy and equipment expense                                                                            |   |                    | 340,017   |   |                   |   | 390,348 |   |   |   | 1,039,328 |   |   |   | 1,155,303 |   |
|           Other operating expense                                                                                        |   |                    | 707,782   |   |                   |   | 481,534 |   |   |   | 2,001,461 |   |   |   | 1,606,017 |   |
|                 Total other expense                                                        |   |                    | 2,135,664 |   |                   |   | 2,292,660 |   |   |   | 7,054,752 |   |   |   | 7,128,779 |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|                 Earnings before income taxes                                               |   |                    | 263,904   |   |                   |   | 1,265,142 |   |   |   | 1,101,951 |   |   |   | 3,694,593 |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Income      taxes                                                                                                                            |   |                    | 24,705    |   |                   |   | 371,928 |   |   |   | 158,900 |   |   |   | 1,075,656 |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|                 Net earnings                                                          |   | $                       | 239,199   |   |                   |   | 893,214 |   |   |   | 943,051 |   |   |   | 2,618,937 |   |
|                                                                                                                                         |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Earnings      per common share based on average outstanding                                                                                  |   |                    |      |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|           shares of 899,815                                                                                              |   | $                       | 0.27      |   |                   |   | 0.99 |   |   |   | 1.05 |   |   |   | 2.91 |   |

----

|                                                                                                           |   | Three      Months Ended |    |   | Nine      Months Ended |   |
|----------------------------------------------------------------------------------------------------------------|--------|-------------------------|---------|--------|------------------------|--------|
|                                                                                                           |   | 2008                    |    |   | 2007                   |   |   | 2008 |   |   | 2007 |   |
|                                                                                                           |   |                    |    |   |                   |   |   |   |   |   |   |   |
| Net      earnings                                                                                         |   | $                       | 239,199 |   |                   |   | 893,214 |   |   |   | 943,051 |   |   |   | 2,618,937 |   |
|                                                                                                           |   |                    |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Other      comprehensive income (loss), net of taxes:                                                          |   |                    |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|     Unrealized      gains (losses) on securities available for sale:                       |   |                    |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|               Holding gains (losses) arising during period, net of tax |   |                    |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|                   (benefit) of $358,057, $639,276, |   |                    |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|              ($106,688),      and $27,798     |   |                    | 585,191 |   |                   |   | 1,044,802 |   |   |   | (174,365 | ) |   |   | 45,432 |   |
|                                                                                                           |   |                    |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|     Reclassification      adjustments for gains included in net                       |   |                    |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|          earnings,      net of tax of $0, $0, $74,881 and $0      |   |                    | -       |   |                   |   | - |   |   |   | (122,383 | ) |   |   | - |   |
|                                                                                                           |   |                    |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|               Total other comprehensive income (loss)                  |   |                    | 585,191 |   |                   |   | 1,044,802 |   |   |   | (296,748 | ) |   |   | 45,432 |   |
|                                                                                                           |   |                    |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|               Comprehensive income                                     |   | $                       | 824,390 |   |                   |   | 1,938,016 |   |   |   | 646,303 |   |   |   | 2,664,369 |   |

----

|                                                                                                                                                                                                              |   | 2008   |        |   | 2007   |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-------------|--------|--------|--------|
| Cash      flows from operating activities:                                                                                                                                                                        |   |   |        |   |   |   |
|      Net      earnings                                                                                                                                                                   |   | $      | 943,051     |   |   |   | 2,618,937 |   |
|          Adjustments      to reconcile net earnings to net                                                                                                           |   |   |        |   |   |   |   |   |
|             cash      provided by operating activities:                                                                                               |   |   |        |   |   |   |   |   |
|                 Provision      for loan losses                                                                                    |   |   | 598,000     |   |   |   | 80,000 |   |
|                 Depreciation,      amortization and accretion                                                                     |   |   | 496,168     |   |   |   | 475,844 |   |
|                 Gains      on sales of securities                                                                                 |   |   | (197,264    | )      |   |   | - |   |
|                 Loss      on sales of other real estate owned                                                                     |   |   | -           |   |   |   | 25,758 |   |
|                 Change      in assets and liabilities:                                                                            |   |   |        |   |   |   |   |   |
|                     Interest      receivable and other assets                                                 |   |   | (230,863    | )      |   |   | 129,246 |   |
|                     Interest      payable and other liabilities                                               |   |   | (547,338    | )      |   |   | 110,792 |   |
|                     Mortgage      loans held for sale                                                         |   |   | 536,987     |   |   |   | 1,242,000 |   |
|                                                                                                                                                                                                              |   |   |        |   |   |   |   |   |
|                            Net      cash provided by operating activities  |   |   | 1,598,741   |   |   |   | 4,682,577 |   |
|                                                                                                                                                                                                              |   |   |        |   |   |   |   |   |
| Cash      flows from investing activities:                                                                                                                                                                        |   |   |        |   |   |   |   |   |
|      Proceeds      from sales of investment securities available for sale                                                                                                                |   |   | 7,320,481   |   |   |   | - |   |
|      Proceeds      from calls, maturities, and paydowns of                                                                                                                               |   |   |        |   |   |   |   |   |
|          investment      securities available for sale                                                                                                               |   |   | 27,205,789  |   |   |   | 7,525,195 |   |
|      Purchases      of investment securities available for sale                                                                                                                          |   |   | (22,566,435 | )      |   |   | (13,431,167 | ) |
|      Purchases      of other investments                                                                                                                                                 |   |   | -           |   |   |   | (36,400 | ) |
|      Proceeds      from sale of other investments                                                                                                                                        |   |   | 27,500      |   |   |   | - |   |
|      Net      change in loans                                                                                                                                                            |   |   | 1,727,903   |   |   |   | 17,249,843 |   |
|      Purchases      of premises and equipment                                                                                                                                            |   |   | (188,031    | )      |   |   | (1,505,397 | ) |
|      Proceeds      from sales of other real estate                                                                                                                                       |   |   | 157,306     |   |   |   | 714,018 |   |
|                                                                                                                                                                                                              |   |   |        |   |   |   |   |   |
|                                  Net cash provided by investing activities |   |   | 13,684,513  |   |   |   | 10,516,092 |   |
|                                                                                                                                                                                                              |   |   |        |   |   |   |   |   |
| Cash      flows from financing activities:                                                                                                                                                                        |   |   |        |   |   |   |   |   |
|      Net      change in deposits                                                                                                                                                         |   |   | (20,424,969 | )      |   |   | (9,119,964 | ) |
|      Net      change in securities sold under repurchase agreements                                                                                                                      |   |   | 8,803,785   |   |   |   | 753,320 |   |
|      Dividends      paid                                                                                                                                                                 |   |   | (1,034,787  | )      |   |   | (1,124,769 | ) |
|                                                                                                                                                                                                              |   |   |        |   |   |   |   |   |
|                            Net      cash used in financing activities      |   |   | (12,655,971 | )      |   |   | (9,491,413 | ) |
|                                                                                                                                                                                                              |   |   |        |   |   |   |   |   |
| Net      increase in cash and cash equivalents                                                                                                                                                                    |   |   | 2,627,283   |   |   |   | 5,707,256 |   |
|                                                                                                                                                                                                              |   |   |        |   |   |   |   |   |
| Cash      and cash equivalents at beginning of period                                                                                                                                                             |   |   | 20,889,937  |   |   |   | 15,077,988 |   |
|                                                                                                                                                                                                              |   |   |        |   |   |   |   |   |
| Cash      and cash equivalents at end of period                                                                                                                                                                   |   | $      | 23,517,220  |   |   |   | 20,785,244 |   |

----

|                                                                                                |   | 2008   |      |   | 2007  |   |
|-----------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|------------|--------|
| Supplemental      cash flow information:                                                            |   |   |      |   |       |   |
|      Cash      paid for interest                                           |   | $      | 6,724,678 |   |       | $      | 8,321,531 |   |
|      Cash      paid for taxes                                              |   | $      | 281,500   |   |       | $      | 786,500 |   |
|                                                                                                |   |   |      |   |       |   |   |   |
| Noncash      investing and financing activities:                                                    |   |   |      |   |       |   |   |   |
|      Transfer      from loans to other real estate owned                   |   | $      | 319,770   |   |       | $      | - |   |
|      Change      in net unrealized gains (losses) on investment securities |   |   |      |   |       |   |   |   |
|         available      for sale, net of taxes               |   | $      | (296,748  | )      |       | $      | 45,432 |   |
| Change      in dividends payable                                                                    |   | $      | 1,034,787 |   |       | $      | 1,124,769 |   |

----

|                                              |   | Nine      Months Ended September 30, |      |
|---------------------------------------------------|--------|--------------------------------------|-----------|
|                                              |   | 2008                                 |      |   | 2007 |   |
|                                              |   |                                 |      |   |   |   |
| Balance      at beginning of year                 |   | $                                    | 3,335,825 |   |   |   | 3,080,661 |   |
| Amounts      charged off                          |   |                                 | (125,828  | ) |   |   | (115,443 | ) |
| Recoveries      on amounts previously charged off |   |                                 | 24,584    |   |   |   | 32,853 |   |
| Provision      for loan losses                    |   |                                 | 598,000   |   |   |   | 80,000 |   |
|                                              |   |                                 |      |   |   |   |   |   |
| Balance      at September 30                      |   | $                                    | 3,832,581 |   |   |   | 3,078,071 |   |

----

----

|                               |   |                    |   |   | Fair      Value Measurements at September 30, 2008 Using                                     |   |
|------------------------------------|--------|-------------------------|--------|--------|----------------------------------------------------------------------------------------------|--------|
|                               |   |                    |   |   | (in      thousands)                                                                          |   |
| Description                        |   | September      30, 2008 |   |   | Quoted      Prices In Active      Markets for      Identical Assets (Level      1) |   |   | Significant      Other      Observable Inputs (Level      2) |   |   | Significant      Unobservable Inputs (Level      3) |   |
|                               |   |                    |   |   |                                                                                         |   |   |   |   |   |   |   |
| Securities      Available for Sale |   | $                       | 79,232 |   |                                                                                         | $      | - |   |   | $ | 79,232 |   |   | $ | - |   |
|                               |   |                    |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |
| Loans      Available for Sale      |   |                    | 526    |   |                                                                                         |   | - |   |   |   | - |   |   |   | 526 |   |
|                               |   |                    |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |
| Other      Real Estate Owned       |   |                    | 150    |   |                                                                                         |   | - |   |   |   | - |   |   |   | 150 |   |
|                               |   |                    |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |
| Impaired      Loans                |   |                    | 17,866 |   |                                                                                         |   | - |   |   |   | - |   |   |   | 17,866 |   |

----

----

|                                              |   | September      30, 2008 |   |   | December      31, 2007 |   |   | September      30, 2007 |   |
|---------------------------------------------------|--------|-------------------------|--------|--------|------------------------|--------|--------|-------------------------|--------|
| Other      real estate                            |   | $                       | 150    |   |                   |   | -      |                    |   |   | - |   |
| Repossessions                                     |   |                    | 4      |   |                   |   | -      |                    |   |   | 4 |   |
| Non-accrual      loans                            |   |                    | 19,656 |   |                   |   | 9,057  |                    |   |   | 1,464 |   |
| Accruing      loans 90 days or more past      due |   |                    | 6      |   |                   |   | -      |                    |   |   | 1 |   |

----

----

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| Risk-Based Capital      Ratios               |
|----------------------------------------------|
|                                         |
| Tier      1 Capital, Actual                  |   | 13.6% |
| Tier      1 Capital minimum requirement      |   | 4.0% |
|                                         |   |   |
| Excess                                       |   | 9.6% |
|                                         |   |   |
| Total      Capital, Actual                   |   | 14.9% |
| Total      Capital minimum requirement       |   | 8.0% |
|                                         |   |   |
| Excess                                       |   | 6.9% |
|                                         |   |   |
| Leverage      Ratio                          |   |   |
|                                         |   |   |
| Tier      1 Capital to adjusted total assets |   | 10.0% |
| Minimum      leverage requirement            |   |  3.0% |
|                                         |   |   |
| Excess                                       |   | 7.0% |

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Item1.         LegalProceedings

| (a)   | Exhibits |                                                                                                                                                                                   |
|-----------------|----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|            | 31.1     | Certification      by B. Amrey Harden, CEO and President of the Corporation, as adopted      pursuant to Section 302 of the Sarbanes-Oxley Act of  2002.                               |
|            |     |                                                                                                                                                                                   |
|            | 31.2     | Certification      by Steven A. Rogers, Vice President and Chief Financial Officer of the      Corporation, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act      of 2002. |
|            |     |                                                                                                                                                                                   |
|            | 32       | Certification      of the Chief Executive Officer and the Chief Financial Officer pursuant to      Section 906 of the Sarbanes-Oxley Act of 2002.                                      |
|            |     |                                                                                                                                                                                   |

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|   |           OCONEE      FINANCIAL CORPORATION  By:            /s/      B. Amrey Harden                                                  B.      Amrey Harden, President and CEO       (Principal      Executive Officer) Date:         November 14, 2008                                                                By:   /s/ Steven A.      Rogers                                          Steven      A. Rogers, Vice President and CFO       Date:         November 14,      2008                                                     |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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