UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   FORM 10-QSB

(Mark One)

[x]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
     OF 1934

                  For the quarterly period ended March 31, 2001


[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

             For the transition period from __________ to __________



                        Commission file number: 333-73385



                               HCNB Bancorp, Inc.
        (Exact name of small business issuer as specified in its charter)

                 Maryland                                  52-2083046
    (State or other  jurisdiction of                     (IRS Employer
     incorporation  or organization)                   Identification No.)


                 1776 East Jefferson Street, Rockville, MD 20852
                    (Address of principal executive offices)

                                  301-468-8848
                           (Issuer's telephone number)

Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the last 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 practical date: As of April 30, 2001, 700,213 shares of
the small business issuer's common stock, par value of $.01 per share, were
issued and outstanding.


Transitional Small Business Disclosure Format (Check one): Yes [    ]   No [ x ]



<PAGE>

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                        HCNB BANCORP, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                MARCH 31, 2001 (UNAUDITED) AND DECEMBER 31, 2000

<TABLE>
<CAPTION>
                                                                     March 31,          December 31,
                                                                       2001                 2000
                                                                   ------------         ------------
                                                                    (unaudited)           (audited)
                                     ASSETS
<S>                                                                <C>                  <C>
Cash and cash equivalents:
     On-hand and due from banks                                    $    587,822         $    997,669
     Federal Funds sold                                               5,390,443            5,276,180
Investment securities, held to maturity                               2,103,743            1,600,575
Loans receivable (net of allowance for credit
     losses of $412,650 and $18,858, and deferred loan fees
     of $18,531 and $00)                                             10,234,920            8,634,181
Investment in Federal Reserve Board stock, at cost                      180,000              180,000
Accrued interest receivable                                              86,498              125,696
Property and equipment, net                                             424,886              435,074
Other assets, net                                                       129,768               83,433
                                                                   ------------         ------------

         Total assets                                              $ 19,138,080         $ 17,332,808
                                                                   ============         ============


                      LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
     Deposits
         Non-interest bearing                                      $  1,695,872         $    840,859
         Interest bearing                                            12,383,240           11,214,242
     Accounts payable and accrued expenses                               32,425              133,765
                                                                   ------------         ------------

         Total liabilities                                           14,111,537           12,188,866

STOCKHOLDERS' EQUITY
     Preferred stock, par value $0.01 per share,
         1,000,000 shares authorized, 0 shares
         issued and outstanding                                            --                   --
     Common stock, par value $0.01 per share,
         9,000,000 shares authorized, 700,213 shares
         issued and outstanding                                           7,002                7,002
     Additional paid-in capital                                       6,995,128            6,995,128
     Accumulated deficit                                             (1,975,587)          (1,858,188)
                                                                   ------------         ------------

         Total stockholders' equity                                   5,026,543            5,143,942

         Total liabilities and stockholders' equity                $ 19,138,080         $ 17,332,808
                                                                   ============         ============
</TABLE>

See accompanying notes to consolidated financial statements.
<PAGE>
                        HCNB BANCORP, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS
            FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2001 AND 2000
                                   (unaudited)

<TABLE>
<CAPTION>
                                                      Three months ended March 31,
                                                        2001              2000
                                                     ---------         ---------
<S>                                                  <C>               <C>
INTEREST INCOME
     Interest income on loans                        $ 258,839         $  20,249
     Interest income on investment securities          105,511            97,095
                                                     ---------         ---------
         Total interest income                         364,350           117,344

INTEREST EXPENSE ON DEPOSITS                           163,134            21,946
                                                     ---------         ---------
         Net interest income                           201,216            95,398

PROVISION FOR LOAN LOSSES                                    0            18,858
                                                     ---------         ---------
         Net interest income after
           provision for loan losses                   201,216            76,540

SERVICE FEES AND CHARGES                                 6,243             2,591
                                                     ---------         ---------
         Net interest income after service             207,459            79,131
           fees and charges

OTHER OPERATING EXPENSES
      Salaries and benefits                            150,494           132,198
     Depreciation and amortization                      12,283            11,353
     Occupancy expense, data processing
        and supplies                                    65,937            50,058
     Marketing                                           6,577            12,270
     Professional fees                                  70,082            61,356
     Other operating expenses                           19,485            19,410
                                                     ---------         ---------
         Total other operating expenses                324,858           286,645
                                                     ---------         ---------
         Loss before provision for
           income taxes                               (117,399)         (207,514)

PROVISION FOR INCOME TAXES                                   0                 0
                                                     ---------         ---------

Net Loss                                             $(117,399)        $(207,514)
                                                     =========         =========

NET LOSS PER SHARE -
       BOTH BASIC AND DILUTED                        $    .168         $    .297

WEIGHTED AVERAGE SHARES
       OUTSTANDING                                     700,213           700,213
</TABLE>

See accompanying notes to consolidated financial statements.



<PAGE>
                        HCNB BANCORP, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
            FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2001 AND 2000
                                   (unaudited)

<TABLE>
<CAPTION>
                                                              2001                2000
                                                          -----------         -----------

<S>                                                       <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES

Cash Inflows
     Interest income                                      $   403,548         $   115,180
     Fees and service charges                                   6,243               2,591
                                                          -----------         -----------
                                                              409,791             117,771
Cash Outflows
     General and administrative expenses                      459,242             265,954
     Interest on deposits                                     164,142              18,336
                                                          -----------         -----------
                                                              623,384             284,290
                                                          -----------         -----------
         Net cash used in operating activities               (213,593)           (166,519)

CASH FLOWS FROM INVESTING ACTIVITIES

Cash Inflows
     Loan principal repayments                                158,808                   0

Cash Outflows
     Purchase of securities held to maturity                 (503,168)         (1,266,764)
     Loan disbursements                                    (1,759,547)         (1,497,320)
     Purchase of property and equipment                        (2,095)            (16,446)
                                                          -----------         -----------
                                                           (2,264,810)         (2,780,530)
                                                          -----------         -----------
         Net cash used in investing activities             (2,106,002)         (2,780,530)

CASH FLOWS FROM FINANCING ACTIVITIES

Cash Inflows
     Net increase in deposits                               2,024,011           2,810,697
                                                          -----------         -----------
         Net cash provided by financing activities          2,024,011           2,810,697
                                                          -----------         -----------

Net decrease in cash and cash equivalents                    (295,584)           (136,352)

Cash and cash equivalents, beginning of period              6,273,849           2,340,296
                                                          -----------         -----------
Cash and cash equivalents, end of period                  $ 5,978,265         $ 2,203,944
                                                          ===========         ===========
</TABLE>

See accompanying notes to consolidated financial statements.
<PAGE>
                        HCNB BANCORP, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
            FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2001 AND 2000
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                   2001             2000
                                                                ---------         ---------
<S>                                                             <C>               <C>
Reconciliation of net income to net cash
  provided by operating activities
         Net loss                                               $(117,399)        $(207,514)
         Adjustments to reconcile net loss to
           net cash from operating activities
                  Provision for loan losses                             0            18,858
                  Depreciation and amortization                    12,283            11,353
         Effects of changes in operating assets
           and liabilities
                  Accrued interest receivable                      39,198            (2,164)
                  Other assets                                    (46,335)           (1,226)
                  Accounts payable and other liabilities         (101,340)           14,174
                                                                ---------         ---------

Net cash used in operating activities                           $(213,593)        $(166,519)
                                                                =========         =========
</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>
                        HCNB BANCORP, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)

1.   ORGANIZATION

HCNB Bancorp, Inc. (the Company) was incorporated under the laws of the State of
Maryland on February 24, 1998,  primarily to hold all of the outstanding  shares
of capital stock of a national bank.

Effective  October,  1999, the Company completed an initial public offering (the
Offering)  in which it sold  700,213  shares of common  stock for $10 per share.
During 1999, the Company received proceeds from the Offering of $7,002,130.

On December 14, 1999, Harbor Capital National Bank (the Bank) received authority
from the Office of the  Comptroller  of the  Currency  and the  Federal  Deposit
Insurance Corporation to begin banking operations.

From  February 24, 1998 until  December 14, 1999,  the Company was  considered a
development stage enterprise.

The Company's  primary  operations are conducted by the Bank, which operates one
branch in Rockville,  Maryland.  The Bank is principally engaged in the business
of attracting  deposits and investing in commercial and consumer loans. The Bank
is subject to certain risks inherent in making loans and accepting deposits.  In
addition to these risks, the Company is currently operating at a loss. Growth in
operations  will be necessary  for the Company to be able to cover  overhead and
other operational costs.


2.   BASIS OF PRESENTATION

The accompanying  consolidated financial statements include the activity of HCNB
Bancorp, Inc. and its wholly owned subsidiary, Harbor Capital National Bank. All
intercompany transactions have been eliminated in consolidation.

The accompanying  consolidated  financial  statements for March 31, 2001 and for
the three-month  periods ended March 31, 2001 and 2000 have been prepared by the
Company,  without audit, pursuant to the rules and regulations of the Securities
and Exchange  Commission.  Certain information and footnote disclosures normally
included in financial  statements prepared in accordance with generally accepted
accounting  principles have been condensed or omitted pursuant to such rules and
regulations.  However, the Company believes that the disclosures are adequate to
make the information presented not misleading.

These consolidated  financial  statements should be read in conjunction with the
financial  statements  and notes  thereto for the year ended  December 31, 2000,
included in the Company's  Annual Report to Stockholders  on Form 10-KSB,  filed
with the  Securities and Exchange  Commission.  The balance sheet as of December
31, 2000 has been derived from the audited financial statements at that date.

The unaudited  consolidated  financial  statements  included  herein reflect all
adjustments (which include only normal, recurring adjustments) which are, in the
opinion of management,  necessary to state fairly the financial  position of the
Company as of March 31,  2001 and the  results of its  operations  for the three
month  periods  ended  March 31,  2001 and 2000 and the cash flows for the three
month periods ended March 31, 2001 and 2000. The results of interim  periods are
not necessarily indicative of the results expected for the full fiscal year.


3.   RELATED PARTY TRANSACTIONS

The officers and directors of the Company and the Bank have deposits in the Bank
approximating $2,745,300 at March 31, 2001.

<PAGE>

The  officers  and  directors  of the Company and the Bank have loans due to the
Bank  approximating  $254,500 at March 31, 2001.  All loans made to officers and
directors are made on substantially the same terms, including interest rates and
collateral,  as those  prevailing at the time for comparable  transactions  with
unaffiliated  third  parties  and do not  involve  more than the normal  risk of
repayment or present other unfavorable features.


4.   REGULATORY MATTERS

The Bank is subject to various regulatory capital  requirements  administered by
the federal banking agencies.  Failure to meet minimum capital  requirements can
initiate certain mandatory - and possibly additional  discretionary - actions by
regulators  that,  if  undertaken,  could have a direct  material  effect on the
Bank's financial  statements.  Under capital action, the Bank must meet specific
capital  guidelines  that involve  quantitative  measures of the Bank's  assets,
liabilities and certain  off-balance  sheet items as calculated under regulatory
accounting  practices.  The Bank's capital amounts and  classification  are also
subject to  qualitative  judgments  by the  regulators  about  components,  risk
weighting and other factors.

Quantitative  measures  established  by  regulation to ensure  capital  adequacy
require the Bank to maintain minimum amounts and ratios. Management believes, as
of March 31, 2001 that the Bank meets all capital adequacy requirements to which
it is subject.

The Bank  has  been  categorized  under  the  regulatory  framework  for  prompt
corrective action as "well capitalized".  To be categorized as well capitalized,
the Bank must maintain minimum total risk-based,  Tier I risk-based,  and Tier I
leverage ratios.


5.   INCOME TAXES

The Company uses the liability method of accounting for income taxes as required
by SFAS No. 119,  "Accounting  for Income  Taxes".  Under the liability  method,
deferred-tax  assets and liabilities are determined based on differences between
the financial  statement  carrying  amounts and the tax basis of existing assets
and liabilities  (i.e.,  temporary  differences) and are measured at the enacted
rates that will be in effect when the differences reverse. Deferred income taxes
will be  recognized  when it is deemed more likely than not that the benefits of
such deferred  income taxes will be realized;  accordingly,  no deferred  income
taxes or income tax benefits have been recorded by the Company.



<PAGE>

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

This discussion and analysis provides an overview of the financial condition and
results of operations  of HCNB  Bancorp,  Inc.  ("Company")  and Harbor  Capital
National  Bank  ("Bank") as of March 31,  2001 and for the three  month  periods
ended March 31, 2001 and 2000.

Some of the  information  in this  discussion  and  analysis  includes  "forward
looking statements". These statements use words such as "may", "will", "expect",
"anticipate",  "plan",  "estimate" or similar words, and they discuss our future
expectations, projections of financial results or strategies that are subject to
risks and uncertainties.  When you read a forward-looking  statement, you should
keep in mind the risk factors set forth in our Annual Report to  Stockholders on
Form 10-KSB for the year ended  December  31, 2000.  Our actual  results and the
actual outcome of our  expectations  and strategies could be different from what
have been described in this report because of these risks and uncertainties.


General
HCNB Bancorp,  Inc. was incorporated  under the laws of the State of Maryland on
February  24,  1998,  to  serve as a bank  holding  company  for a newly  formed
commercial  bank,  Harbor  Capital  National Bank. The Bank received its charter
from the Office of the  Comptroller  of the  Currency on  December  14, 1999 and
commenced  operations  that day from its sole  location  at 1776 East  Jefferson
Street, Rockville,  Maryland. The Bank is a member of the Federal Reserve System
and its deposits are insured by the Federal Deposit Insurance Corporation.

The Company  completed its initial  offering of its shares of common stock ($.01
par value) in October,  1999. In the initial offering,  700,213 shares were sold
at a  price  of  $10.00  per  share;  total  proceeds  from  the  offering  were
$7,002,130.  After  offering  expenses,  the net  proceeds to the  Company  were
$6,828,075.  The Bank was initially  capitalized  by the Company in an amount of
$6,000,000.


Financial Condition
As of March 31,  2001,  assets were  $19,138,080.  This  represents  a growth of
$1,805,272  or 10.42% since  December 31, 2000.  Deposits at March 31, 2001 were
$14,079,112,  an increase since year-end 2000 of $2,024,011 or 16.79%. Net loans
outstanding  at March 31, 2001 were  $10,234,920  as  compared  to  $8,634,181at
December 31, 2000, which reflects as increase of 18.54%. This growth in business
activity was mostly  attributable  to increased  calling  activities  within the
Bank's market area. In addition,  management  has set the interest rates paid on
deposits  to be  competitive  in the  market  and has  seen an  increase  in the
business development  activities of its directors and officers.  The Bank has no
brokered funds.

As of March 31, 2001,  loans (net of an  allowance  for loan losses and deferred
loan fees)  totaled  $10,234,920,  the  majority  of which were  commercial  and
commercial real estate loans. However, the Bank has developed a growing niche in
home equity  lending.  The growth in the  portfolio,  18.54% since  December 31,
2000, is also the result of increased business development activities within the
Bank's market area.

Funds not extended in loans are held in the investment portfolio, which includes
Federal  funds  sold.  At March 31,  2001,  the Bank had  investment  securities
totaling $2,103,743 which were short-term obligations of government agencies and
were all held to  maturity.  Federal  funds sold  totaled  $5,390,443  and other
investments  included  Federal Reserve Bank stock and a $100,000  certificate of
deposit.

Total capital at March 31, 2001 was $5,026,543. Management believes this capital
will be  adequate  to fund the  Company's  and  Bank's  operations  for the next
twelve-month period.


Results of Operations
On a  consolidated  basis,  the Company  recorded a net loss of $117,399 for the
three-month period ended March 31, 2001. This compares to a net loss of $207,514
for the three-month  period ended March 31, 2000. The reduction is due mostly to
growth  realized  by the Bank  and an  increase  in net  interest  margin  which
provided a greater coverage of overhead expenses.

<PAGE>

Operating results for the year ending December 31, 2001 are projected to reflect
losses as loan and deposit  growth is not  expected  to be produce net  interest
income sufficient to cover operating  expenses,  however it is expected that the
Bank will continue to reduce its losses in subsequent periods.


Net Interest Income
Net interest  income is the difference  between income on assets and the cost of
funds  supporting those assets.  Earning assets are composed  primarily of loans
and  investments;   interest  bearing  deposits  make  up  the  cost  of  funds.
Non-interest  bearing deposits and capital are also funding sources.  Changes in
the volume and mix of earning  assets and funding  sources along with changes in
associated interest rates determine changes in net interest income.

The net  interest  income for the  three-month  period  ended March 31, 2001 was
$201,216, as compared to $95,398 for the same period in 2000. Most of the growth
came as a result of an increase in the loan portfolio  whereby interest on loans
totaled  $258,839  for the three  months  ended March 31,  2001,  as compared to
$20,249 for the three months ended March 31, 2000.

Growth in the loan  portfolio  resulted  in greater  contributions  to  interest
income in the first quarter of 2001, because the yields on loans are normally 3%
to 5% higher  than  yields on  investment  securities.  At March 31,  2001,  the
weighted  average yield on the loan  portfolio was 9.43%;  the weighted  average
yield on the investment portfolio was 5.04%.

The Bank is located in a competitive  environment and the rates of interest paid
on  its  deposits  are  somewhat  driven  by  those  paid  by  other  depository
institutions.  Management  has taken a  position  to be  competitive  within the
market,  normally placing the Bank in the upper  one-quarter of those depository
institutions competing with it for deposits,  however the Bank has chosen not to
aggressively  compete for jumbo  certificates  of deposits which are highly rate
sensitive.  At March 31, 2001, the Bank's weighted  average cost of deposits was
4.64%.  It is  anticipated  that both the volume of  deposits  and the  interest
expense will increase during the next  twelve-month  period based upon increased
marketing activities.


Allowance and Provision for Credit Losses
The provision for credit losses  represents an expense to fund the allowance for
credit losses.  These funds are set aside in anticipation of potential of credit
losses in the current  loan  portfolio.  The amount  allocated  is based on many
factors which are considered in  management's  assessment of the loan portfolio.
These factors are generally defined by regulatory directives and include lending
policies and procedures,  local economic and business conditions, the nature and
volume of the loan portfolio,  the Bank's lending management and staff, past-due
history,  the Bank's loan review system,  concentrations  of credit and external
factors which may  adversely  affect the credit risk of the loan  portfolio.  In
addition to the overall  analysis of the portfolio,  management  evaluates every
major credit and may assign a risk adjustment, based upon the specific credit.

Based upon  management's  analysis of the loan  portfolio  as of March 31, 2001,
management did not increase the provision for loan and lease losses. As of March
31, 2001,  the  provision for credit losses  totaled  $412,650.  This amount was
deemed adequate by management and the Board of Directors based upon the analysis
methodology used by the Bank and as suggested by regulatory directives. At March
31, 2001, the provision for credit losses was 3.87% of total loans outstanding.

The level of the Provision for Credit Losses  reflects a higher than normal risk
exposure.  This exposure is mostly due to loan underwriting and structure issues
as well as credit administration concerns.  Management is committed to improving
its lending practices and operations.  Two lending  professionals with extensive
backgrounds  in community  bank lending and the local markets have been employed
and are beginning to address the regulatory concerns.

Non-Interest Income
Non-interest  income is primarily  deposit  account service charges and fees for
ancillary  services  such  as ATM  access  and  safe  deposit  rentals.  For the
three-month period ended March 31, 2001, the Bank realized  non-interest  income
in the amount of $6,243.  This compares to $2,591  realized in the first quarter
of 2000. These fees are volume driven, based mostly on the deposit customer base
and should increase as the customer base increases.  The Bank


<PAGE>

has seen increased use of its automated  teller machine  especially by consumers
holding debit/ATM cards issued by other financial institutions.


Non-Interest Expense
Non-interest  expense for the three-month  periods ended March 31, 2001 and 2000
were $324,858 and $286,645.  The largest portion of these operating expenses was
salaries and employee benefits. For the three-month period ended March 31, 2001,
$150,494 was salary and employee benefits  expenses.  This represents 46% of all
other operating expenses.

It is  anticipated  that  operating  expenses  will  increase  but  it  is  also
anticipated that net interest income will increase in subsequent periods.

Liquidity and Capital Resources
Stockholders'  equity at March 31, 2001 was $5,026,543 compared to $5,143,942 at
December  31,  2000.  The decline in  stockholders'  equity is due mostly to the
operating  results of the Bank.  No cash  dividends  have been  declared  by the
Company since its inception.

Banking  regulatory  authorities  have  implemented  strict  capital  guidelines
directly  related to the credit risk  associated with an  institution's  assets.
Banks and bank holding  companies are required to maintain  capital levels based
on their  "risk  adjusted"  assets  so that  categories  of assets  with  higher
"defined"  credit risks will require more capital support that assets with lower
risks.  The Bank has exceeded its capital  adequacy  requirements to date and is
considered to be "well capitalized", under regulatory standards.

The Bank's liquidity is provided by its cash and cash equivalents, which are its
cash on hand and on deposit with other  financial  institutions  and its federal
funds sold. The levels of such assets are dependent  upon the Bank's  operating,
financing and investment  activities at any given time.  Variations in levels of
cash and cash  equivalents  are  mostly  influenced  by  deposit  flows and loan
activity.  At March 31, 2001, the Bank held cash and cash  equivalents  totaling
$587,822 and Federal  funds sold of  $5,390,443.  Management  believes that this
liquidity level is adequate to meet the anticipated needs of the Bank.


<PAGE>

                           PART II - OTHER INFORMATION

Item 1.   Legal Proceedings

               None


Item 2.   Changes in Securities and Use of Proceeds

          (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

          On March 8, 2001, the Bank entered into a Memorandum of  Understanding
          ("Memorandum") with the Office of the Comptroller of the Currency, the
          Bank's primary regulator,  as a result of the OCC's examination of the
          Bank in December,  2000. The Memorandum is an informal  agreement with
          the OCC that is not  enforceable by the OCC; entry into the Memorandum
          was a voluntary act by the Bank. The Bank agreed,  among other things,
          to take the following actions:
          o    Retain a senior lending officer with appropriate qualifications;
          o    Review and revise the Bank's loan policy, so that the policy more
               clearly  identifies  acceptable  levels  of risk,  administrative
               responsibilities  and acceptable  underwriting and  documentation
               standards;
          o    Correct  certain credit and  collateral  exceptions on loans that
               have  such  deficiencies,  and make  future  grants,  extensions,
               renewals or  restructuring  of credit only after a formal  credit
               analysis is performed and all  necessary  credit  information  is
               obtained;
          o    Retain an  independent  person or firm to perform  on-going  loan
               review and develop a loan review system that will contain certain
               information requested by the OCC; and,
          o    Develop  and  adhere  to  written  programs,  including  an asset
               diversification  program,  a program regarding  maintenance of an
               adequate  allowance  for loan and  lease  losses,  a  program  to
               improve  construction loan underwriting  standards and a consumer
               compliance program.

          The  Bank has  established  a  Compliance  Committee  of the  Board of
          Directors  to  address  the  issues in the  Memorandum,  to ensure the
          compliance of all regulatory  issues and to report findings to the OCC
          on a quarterly  basis.  Management is committed to complying  with the
          terms of the Memorandum as quickly as possible.

          The Bank has retained an experienced community bank lender to serve as
          its Senior  Lending  Officer and as an  executive  officer of the Bank
          subject to approval of the OCC. This  individual  does have sufficient
          authority  to ensure  the Bank's  compliance  with the  Memorandum  of
          Understanding  and the safe and sound  operation of the Bank's lending
          function. As is required by

<PAGE>


          regulation,  this  individual's  background and experience in light of
          the  executive  management  position  held in a de novo  bank  and the
          requirements of the Memorandum of Understanding are being evaluated by
          the Bank's  primary  regulator,  The Office of the  Comptroller of the
          Currency.

          The Bank's new Senior Lending Officer is actively involved in a review
          of  the  Bank's   lending   policies  and   practices  and  will  make
          recommendations  to  specifically   address  the  regulatory  concerns
          expressed  in  the  Report  of  Examination   and  Memorandum  and  to
          effectively manage the risks associated with the extensions of credit.

          The Bank has  retained  an  outside  vendor  to  provide  loan  review
          services,  as is required by the  Memorandum,  and the formal external
          loan review process has begun.

          An  Allowance  for Loan and Lease  Losses  Program was  developed  and
          approved  by the Board of  Directors  of the Bank in  April,  as was a
          Consumer Compliance Program


Item 6    Exhibits

          (a)  No reports on Form 8-K were filed during the quarter  ended March
               31, 2001.







<PAGE>

                                   Signatures

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                            HCNB Bancorp, Inc.
                                            (Registrant)

Date
     --------------------------             ------------------------------------
                                            Michael J. Burke, Chairman/President
                                            (Principal Executive Officer)

Date
     --------------------------             ------------------------------------
                                            Li-Min Lee, Treasurer
                                            (Principal Accounting and
                                            Financial Officer)