<PAGE>
                                       1

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

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

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997

Commission File Number:  33-28514-A
                          ----------

                         BRYAN BANCORP OF GEORGIA, INC.
--------------------------------------------------------------------------------
        (exact name of small business issuer as specified in its charter)

         GEORGIA                                         58-1835646
-------------------------------             ------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

9971 Ford Ave., Richmond Hill, Georgia                      31324
----------------------------------------    ------------------------------------
(Address of principal executive offices)                 (Zip code)

                                 (912) 756-4444
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

  Securities registered pursuant to Section 12(b) of the Exchange Act of 1934:
                                      None
                          ----------------------------

  Securities registered pursuant to Section 12(g) of the Exchange Act of 1934:
                                      None
                          ----------------------------

Check whether the  registrant (1) filed all reports to be filed by section 13 or
15(d) of the  Securities  Exchange Act of 1934 during the past 12 months (or for
such shorter period that the registrant was required to file such reports),  and
(2) has been subject to such filing requirements for the past 90 days.
                                  Yes   x                    No
                                       ----                      ----

Check if there is no disclosure of delinquent  filers in response to item 405 of
regulation  S-B is not  contained  in  this  form,  and no  disclosure  will  be
contained,  to the  best of  registrant's  knowledge,  in  definitive  proxy  or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB.   x
                                       ----

The issuer's revenues for its last fiscal year were $6,254,856

The  aggregate  market  value  of the  common  stock of the  registrant  held by
nonaffiliates  (252,089 shares) on March 2, 1998 was  approximately  $13,174,171
(based on a per share  price of  $52.26,  which  represents  1.85 times the most
recently  reported trade of the common stock of Savannah  Bancorp,  Inc.,  which
pursuant to an Agreement of Merger with  Registrant,  as described  hereinafter,
agreed to issue 1.85 shares of its common  stock in  exchange  for each share of
the common stock of Registrant).

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

                       502,508 shares as of March 2, 1998
                       ----------------------------------

                      DOCUMENTS INCORPORATED BY REFERENCE:
                                      None
                          ----------------------------
Transitional Small Business Disclosure Format:
                                  Yes                        No   x
                                       ----                      ----
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                                       2

                                     PART I

Item 1.  Business.
------------------

History and Organization

Bryan  Bancorp of Georgia,  Inc. (the  "Company")  is a registered  bank holding
company under the federal Bank Holding Act of 1956, as amended, and owns 100% of
the outstanding capital stock of Bryan Bank & Trust, Richmond Hill, Georgia (the
"Bank").  The Company was incorporated under the laws of the State of Georgia on
March 6, 1989 to  enhance  the Bank's  ability  to serve its  future  customers'
requirements  for financial  services.  The holding company  structure  provides
flexibility for expansion of the Company's banking business through  acquisition
of other  financial  institutions  and provision of  additional  banking-related
services  which the  traditional  commercial  bank may not provide under present
laws.

The Bank  commenced  operations  on December  27,  1989 in a permanent  facility
located  on Ford  Avenue in  Richmond  Hill,  Georgia.  This 8,700  square  foot
facility is owned by the Bank.

The Bank is a full service  commercial  bank,  without  trust  powers.  The Bank
offers a full range of  interest  bearing  and  non-interest  bearing  accounts,
including   commercial  and  retail  checking  accounts,   negotiable  order  of
withdrawal ("NOW") accounts,  super NOW accounts,  public funds accounts,  money
market  accounts,   individual  retirement  accounts,  regular  interest-bearing
savings accounts,  certificates of deposit, business accounts, commercial loans,
real estate loans and consumer/installment loans.

Market Area and Competition

The primary service area for the Bank encompasses  approximately 60 square miles
in the Richmond Hill area of Bryan  County,  Georgia  including  that portion of
Bryan County south of Fort Stewart  extending  south to the northern  portion of
Liberty County and the southern fringes of Chatham County, Georgia.

There is only one banking facility,  a branch office of state bank headquartered
in Bryan County,  which is located in the Bank's primary service area.  However,
the Bank is in competition with many statewide and regional banks having offices
immediately   north  of  the  Bank's  primary  service  area  in  the  adjoining
Metropolitan Savannah area, as well as savings and loan associations,  insurance
companies, consumer finance companies, brokerage houses, credit unions and other
business  entities located in Chatham County,  which have recently been invading
the traditional banking markets.

Asset/Liability Management

It is the  objective of the Bank to manage assets and  liabilities  to provide a
satisfactory,   consistent  level  of  profitability  within  the  framework  of
established cash, loan, investment,  borrowing and capital policies.  Certain of
the officers of the Bank are responsible for monitoring  policies and procedures
that are designed to ensure acceptable  composition of the assets/liability mix,
stability and leverage of all sources of funds while adhering to prudent banking
practices.  It is the overall  philosophy  of management to support asset growth
primarily  through  growth  of core  deposits,  which  include  deposits  of all
categories made by individuals, partnerships and corporations. Management of the
Bank seeks to invest the  largest  portion of the Bank's  assets in  commercial,
consumer and real estate loans.


The Bank's  asset/liability mix is monitored on a regular basis with a quarterly
report reflecting  interest-sensitive assets and interest-sensitive  liabilities
being prepared and presented to the Bank's Board of Directors.  The objective of
this policy is to control  interest-sensitive  assets and  liabilities  so as to
minimize the impact of  substantial  movements  in interest  rates on the Bank's
earnings.

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                                       3


Correspondent Banking

Correspondent  banking involves the provision of services by one bank to another
bank which cannot  provide that service for itself from an economic or practical
standpoint.  The Bank is required to purchase  correspondent services offered by
larger banks,  including check collections,  purchase of Federal Funds, security
safekeeping,  investment  services,  coin and  currency  supplies,  overline and
liquidity  loan  participations,  and sales of loans to or  participations  with
correspondent  banks. The Bank currently has a correspondent  relationship  with
SunTrust of Atlanta,  SunTrust of  Savannah,  the Bankers  Bank,  Barnett  Bank,
Regions Bank, The Savannah Bank, Federal Home Loan Bank, and First Tennessee.

The  Bank  sells  loan   participations  to  correspondent   banks  and  certain
development  authorities  with respect to loans which exceed the Bank's  lending
limit.

Data Processing

The Bank has a data processing servicing agreement with M&I Data Services,  Inc.
This servicing  agreement  provides for the Bank to receive a full range of data
processing  services,  including an automated  general ledger,  deposit and loan
accounting. The data processing servicing agreement provides for the Bank to pay
a monthly  fee based on the type,  kind and volume of data  processing  services
provided, priced at a stipulated rate schedule.

Employees

The bank employs 34 persons,  of which 31 are full-time  employees.  None of the
employees are represented by a labor union or other collective  bargaining unit,
and management believes its employees relationships are satisfactory.

Monetary Policies

The  results  of  operations  of the Bank are  affected  by credit  policies  of
monetary authorities, particularly the Federal Reserve Board. The instruments of
monetary  policy  employed  by the Federal  Reserve  Board  include  open market
operations in U.S. Government securities, changes in the discount rate on member
bank borrowings,  changes in reserve  requirements  against member bank deposits
and limitations on interest rates which member banks may pay on time and savings
deposits.  In view of changing  conditions  in the  national  economy and in the
money  markets,  as well as the  effects  of  actions  by  monetary  and  fiscal
authorities,  including the Federal  Reserve Board, no prediction can be made as
to possible future changes in interest rates, deposit levels, loan demand or the
business and earnings of the Bank.

Supervision and Regulation

The Company and the Bank operate in a highly  regulated  environment,  and their
business  activities  are  governed by statute,  regulation  and  administrative
policies.  The  business  activities  of the  Company  and the Bank are  closely
supervised by a number of state and federal regulatory  agencies,  including the
Georgia  Department  of Banking and  Finance,  the Federal  Reserve  Board,  the
Securities and Exchange Commission and the Federal Deposit Insurance Corporation
("FDIC").

The Company is  regulated  by the Federal  Reserve  Board under the Federal Bank
Holding  Company Act, which  requires  every bank holding  company to obtain the
prior approval of the Federal Reserve Board before acquiring more than 5% of the
voting shares of any bank or all or  substantially  all of the assets of a bank,
and before  merging or  consolidating  with another bank  holding  company.  The
Federal Reserve Board (pursuant to regulation and published  policy  statements)
has maintained  that a bank holding  company must serve as a source of financial
strength to its  subsidiary  banks.  In adhering  to the Federal  Reserve  Board
policy the Company may be required to provide  financial support to a subsidiary
bank at a time when,  absent such Federal Reserve Board policy,  the company may
not deem it advisable to provide such assistance.
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                                       4


Interstate  expansion  of bank  holding  companies  is  prohibited  unless  such
acquisition  is  specifically  authorized by a statute of the state in which the
target  bank or bank  holding  company is  located.  A bank  holding  company is
generally  prohibited from acquiring  control of any company which is not a bank
and from engaging in any business other than the business of banking or managing
and controlling  banks.  However,  there are certain  activities which have been
identified by the Federal  Reserve Board to be so closely  related to banking as
to be a proper incident thereto and thus permissible for bank holding companies,
including the following activities: acting as investment or financial advisor to
subsidiaries and certain outside  companies;  leasing personal and real property
or acting as a broker with  respect  thereto;  providing  management  consulting
advice to nonaffiliated  banks and nonbank  depository  institutions;  operating
collection agencies and credit bureaus; acting as a futures commission merchant;
providing data processing and data transmission services; acting as an insurance
agent or underwriter with respect to limited types of insurance; performing real
estate appraisals;  arranging commercial real estate equity financing; providing
securities  brokerage  services;  and underwriting and dealing in obligations of
the United States, the states and their political subdivisions.

The Company is also  regulated by the Georgia  Department of Banking and Finance
under the Georgia Bank Holding  Company Act,  which  requires every Georgia bank
holding  company to obtain prior  approval of the  Commission of Banking  before
acquiring more than 5% of the voting shares of any bank or all or  substantially
all of the assets of a bank, and before merging or consolidating  with any other
bank holding  company.  A Georgia bank holding  company is generally  prohibited
from  acquiring  ownership or control of 5% or more of the voting  shares of any
bank unless the bank being acquired is either a bank for purposes of the Federal
Bank Holding Company Act, or a federal or state savings and loan  association or
a federal saving bank whose deposits are insured by the Federal Savings and Loan
Insurance  Corporation,  and such bank has been in  existence  and  continuously
operating  as a bank for a  period  of five  years or more  prior to the date of
application to the Commissioner for approval of such acquisition.

Both the  Company and the Bank are subject to  regulatory  capital  requirements
imposed by the Federal  Reserve  Board and the FDIC.  In 1989,  both the Federal
Reserve Board and the FDIC issued new  risk-based  capital  guidelines  for bank
holding  companies  and banks which make  regularly  capital  requirements  more
sensitive to differences in risk profiles of various banking organizations.  The
capital adequacy  guidelines  issued by the Federal Reserve Board are applied to
bank  holding  companies  on a  consolidated  basis with the banks  owned by the
holding  company.   The  FDIC's  risk  capital   guidelines  apply  directly  to
state-chartered  banks which are not members of the Federal  Reserve  System and
whose  deposits  are  insured  by the  FDIC  regardless  of  whether  they are a
subsidiary of a bank holding  company.  Both agencies'  requirements  (which are
substantially  similar)  provide  that banking  organizations  must meet minimum
capital  requirements.  Regulatory  guidelines  define  capital as either Tier 1
(primarily includes common stock, paid-in capital and retained earnings) or Tier
2 (primarily  consists of subordinated  debentures,  certain preferred stock and
general  loan and lease  valuation  allowances).  The  Company  and the bank are
subject to a minimum  Tier 1 capital to  risk-weighted  assets ratio of 4% and a
total capital to risk-weighted assets of 8%.  Additionally,  the Company and the
Bank are subject to a minimum Tier 1 leverage  ratio of 4%. At December 31, 1996
the Company and the Bank meet all minimum capital  requirements.  See note 10 to
the consolidated financial statements.

Both the  risk-based  capital  guidelines  and the  leverage  ratio are  minimum
requirements,  applicable only to top-rated banking  institutions.  Institutions
operating at or near these levels are  expected to have  well-diversified  risk,
excellent asset quality,  high liquidity,  good earnings and in general, have to
be considered  strong banking  organizations,  rated composite 1 under the CAMEL
rating system for banks or the BOPEC rating  system for bank holding  companies.
Institutions  with lower  ratings and  institutions  with high levels of risk or
experiencing  or anticipating  significant  growth would be expected to maintain
ratios 100 to 200 basis points above the stated minimums.


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                                       5


The Federal  Reserve  Board and the FDIC  recently  have  proposed a revision to
their risk-based capital guidelines to further ensure that those guidelines take
adequate account of interest rate risk. Interest rate risk is the adverse effect
that changes in market interest rates may have on a bank's  financial  condition
and is inherent to the  business of banking.  The  agencies  have  proposed  two
alternative  methods for assessing a bank's  capital  adequacy for interest rate
risk.  Under the first approach,  the banking  agencies would establish  minimum
capital  standards for interest rate risk based on either a supervisory model or
the bank's internal model of measuring risk.  Institutions  would be required to
have capital  sufficient  to cover the amount of measured  exposure in excess of
the threshold  level.  The proposed  threshold level is a decline in net economy
value  equal to 1% of  assets.  Under the  second  approach,  a minimum  capital
requirement  for interest rate risk would not be set.  Instead,  examiners would
consider results of quantitative measures of interest rate risk along with other
factors in evaluating an institution's  capital adequacy for interest rate risk.
The Federal Deposit Insurance  Corporation  Improvement Act of 1991 (the "Act"),
enacted on December 19, 1991,  provides for a number of reforms  relating to the
safety and soundness of the deposit  insurance  system,  supervision of domestic
and foreign depository institutions and improvement of accounting standards. One
aspect of the Act involves the  development  of a regulatory  monitoring  system
requiring prompt action on the part of banking regulators with regard to certain
classes of undercapitalized  institutions.  While the Act does not change any of
the  minimum  capital  requirements,  it  directs  each of the  federal  banking
agencies to issue regulations  putting the monitoring plan into effect.  The Act
creates five "capital categories" ("well capitalized", "adequately capitalized",
and   "undercapitalized",   "significantly   undercapitalized"  and  "critically
undercapitalized")  which  are  defined  in the  Act and  which  will be used to
determine the severity of corrective  action the appropriate  regulator may take
in the event an institution  reaches a given level of  undercapitalization.  For
example, an institution which becomes  "undercapitalized"  must submit a capital
restoration plan to the appropriate  regulator  outlining the steps it will take
to become  adequately  capitalized.  Upon approving the plan, the regulator will
monitor the institution's compliance.  Before a capital restoration plan will be
approved, any entity controlling a bank (i.e., holding companies) must guarantee
compliance with the plan until the  institution has been adequately  capitalized
for four consecutive calendar quarters.  The liability of the holding company is
limited to the lesser of five percent of the  institution's  total assets or the
amount which is  necessary to bring the  institution  into  compliance  with all
capital  standards.  In  addition,   "undercapitalized"   institutions  will  be
restricted   from  paying   management   fees,   dividends   and  other  capital
distributions,  will be subject to certain asset growth restrictions and will be
required to obtain prior  approval  from the  appropriate  regulator to open new
branches or expand into new lines of business.  As an institution drops to lower
capital levels,  the extent of action to be taken by the  appropriate  regulator
increases,  restricting  the types of  transactions in which the institution may
engage and  ultimately  providing for the  appointment of a receiver for certain
institutions  deemed to be  critically  undercapitalized.  The Act also provides
that banks have to meet new safety and soundness  standards.  In order to comply
with the Act, the Federal Reserve Board and the FDIC issued a Notice of Proposed
Rulemaking  on  November  18,  1993,  which  institutes   regulations   defining
operational  and  managerial  standards  relating  to  internal  controls,  loan
documentation,  credit  underwriting,  interest  rate  exposure,  asset  growth,
director and officer compensation, asset quality, earnings and stock valuation.

The State of Georgia has a regional  interstate banking statute which authorizes
bank holding  companies whose  operations are  principally  conducted in certain
southeastern  states to  acquire  banks and bank  holding  companies  located in
Georgia under certain conditions. Such southeastern states include the States of
Alabama, Arkansas, Florida, Louisiana,  Maryland,  Mississippi,  North Carolina,
South Carolina, Tennessee, Virginia, West Virginia and the District of Columbia.
Such  legislation has had the effect of increasing  competition  among financial
institutions in the Bank's market area and in the State of Georgia generally.

The Georgia General Assembly  recently enacted  legislation  altering the public
policy  of the State  regarding  intrastate  branch  banking.  Essentially,  the
legislation  allows a bank to establish de novo branch banks on a limited  basis
beginning July 1, 1996. Between July 1, 1996 and June 30, 1998, the number of de
novo  branch  banks is  limited to three per bank or group of  affiliated  banks
under the same bank holding  company.  Beginning  July 1, 1998, the number of de
novo branch banks which may be established is no longer limited by statute.
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                                       6


As a bank  holding  company,  the  Company is  required to file with the Federal
Reserve Board an annual report of its  operations at the end of each fiscal year
and such  additional  information  as the  Federal  Reserve  Board  may  require
pursuant to the Act. The Federal Reserve Board may also make examinations of the
Company and each of its  subsidiaries.  As a state bank,  the Bank is subject to
the  supervision  of the Georgia  Department  of Banking  and Finance  and, to a
limited extent,  the FDIC and the Federal Reserve Board. In addition,  the Bank,
as a subsidiary of the Company,  is subject to restrictions under federal law in
dealing with the Company and other affiliates,  if any. These restrictions apply
to  extensions of credit to an affiliate,  investments  in the  securities of an
affiliate and the purchase of assets from an affiliate.

The RCDRIA was enacted  September 23, 1994, to promote  economic  revitalization
and  community  development  to  "investment  areas".  The RCDRIA  establishes a
Community Development  Financial  Institutions Fund to achieve these objectives.
The fund is  authorized  to provide  financial  assistance  through a variety of
mechanisms, including equity investments, grants, loans, credit union shares and
deposits.   The  amount  of  assistance  any  community   development  financial
institution and its subsidiaries and affiliates may receive is generally limited
to $5 million. A qualifying  institution may receive an additional $3.75 million
for the purpose of serving an investment area in another state.

The RCDRIA also  provides  certain  regulatory  relief,  requiring  each federal
agency  to  streamline  and  modify  its   regulations   and  policies,   remove
inconsistencies and eliminate outmoded and duplicative requirements.  The RCDRIA
also directs the federal  agencies to coordinate  examinations  among  affiliate
banks,  coordinate  examinations  with  other  banking  agencies,  and  work  to
coordinate with state banking  agencies.  The federal banking  agencies are also
directed  to  work  jointly  in  developing  a  system  for  banks  and  savings
associations to file reports and statements electronically and to adopt a single
form for filing core information in reports and statements.

The  RCDRIA  also  provides  procedures  for  expediting  bank  holding  company
applications,  eliminating  prior  approval  of  the  Federal  Reserve  for  the
acquisition of control of a bank in a  reorganization  in which persons exchange
their shares for shares of a newly-formed bank holding company provided the bank
holding  company  immediately  after the  acquisition  meets  capital  and other
financial  standards  and the  bank is  "adequately  capitalized",  the  holding
company  does not engage in any  activities  other than  those of  managing  and
controlling banks, the company provides 30 days prior notice to the board of the
transaction,  and the holding company will not acquire control of any additional
bank. The RCDRIA also provides for reduction of  post-approval  waiting periods,
decreasing  the waiting  period from 30 days to 15 days in most  instances.  The
RCDRIA also exempts from federal  securities  registration  securities issued in
connection with the formation of a one-bank holding company.

The  RCDRIA  also  permits a bank  holding  company  to  engage  in  non-banking
activities or acquire or retain  ownership or control of the shares of a company
engaged  in  non-banking  activities  if prior  written  notice of the  proposed
transaction  or activity  is  provided  to the Federal  Reserve at least 60 days
before the  transaction  or  activity  occurs or  commences.  In  assessing  the
proposed transaction or activity, the board will consider whether performance of
the  activity  by a bank  holding  company or a  subsidiary  can  reasonably  be
expected  to  produce  benefits  to the  public,  such as  greater  convenience,
increased  competition or gains in efficiency  that outweighs  possible  adverse
effects.

The section of the Bank Holding  Company Act ("BHCA")  permitting a bank holding
company to engage in nonbanking  activities with sixty day notice was amended by
the Economic Growth and Regulatory Paperwork Reduction Act of 1966, enacted as a
part of the  Omnibus  Consolidated  Appropriations  Act for Fiscal  Year 1997 to
permit a well-capitalized  and well-managed bank holding company,  that controls
predominantly  well-capitalized  and well-managed  depository  institutions,  as
defined by amendments to the Bank Holding  Company Act, to engage de novo in any
permissible   non-banking   activities   (except   for  an  insured   depository
institution,  i.e., a savings  association)  under expedited  procedures.  To be
eligible for the expedited procedures, the book value of the assets acquired may
not exceed 10% of the holding  company's  consolidated  risk weighted assets and
the  consideration  paid may not exceed  15% of Tier one  capital.  The  Federal
Reserve  Board may adjust  these  percentages.  In addition,  no  administrative
enforcement  action may have been  commenced or be pending nor may any cease and
desist  order  pursuant  to ss 8 of the FDIC Act have been  issued or be pending
against the holding company or any of its depository institutions  subsidiaries.

<PAGE>
                                       7


While all qualifying  holding  companies  engaging in  permissible,  non-banking
activities  under the expedited  procedures  must provide  notice to the Federal
Reserve Board, the notice provisions  differ.  First, to engage de novo directly
or through a  subsidiary  in  activities  that the Fed has  already  approved by
regulation,  the bank holding  company must provide notice within ten days after
commencing  the  activity.  Second,  to  engage in  activities  that the Fed has
permitted  by order or to acquire the shares or assets of an  existing  company,
the bank holding company must provide notice at least twelve business days prior
to  commencing  the  activity,  during  which time the Fed may  require the full
60-day notice procedure.

The Interstate Bank Act,  enacted  September 29, 1994, will, among other things,
permit bank holding  companies to merge their multi-state bank subsidiaries into
a single bank by June 1, 1997, unless state legislators act to "opt-out" of this
provision,  to acquire banks in any state one year after the  effective  date of
the Interstate Banking Act and permit banks to establish de novo branches across
state lines so long as the  individual  states  into which a  potential  de novo
entrant proposes to branch specifically passes legislation to "opt-in".

Under the Interstate  Bank Act, a bank may merge beginning on June 1, 1997, with
a bank in another state so long as the transaction  does not involve a bank in a
home state which has enacted a law after the date of enactment of the Interstate
Banking Act and before June 1, 1997,  that  applies  equally to all out of state
banks and expressly  prohibits such interstate merger  transactions.  Such a law
would have no effect on merger  transactions  approved before the effective date
of such state law.  States may also elect to permit merger  transactions  before
June 1, 1997.

The  Interstate   Banking  Act  authorizes   interstate  mergers  involving  the
acquisition  of a branch of a bank without the  acquisition  of the bank only if
state law permits an out of state acquiror to acquire a branch without acquiring
the bank.  State  minimum  age laws for banks to be acquired  will be  preserved
unless  state law  provides  for a minimum  age period of more than five  years.
After  consummation of any interstate merger  transaction,  a resulting bank may
establish or operate additional branches at any location where any bank involved
in the transaction  could have established or operated a branch under applicable
federal or state law.

Beginning  September  29, 1995,  the Board of  Governors of the Federal  Reserve
System is  authorized  to approve  the  acquisition  by a well  capitalized  and
adequately  managed  bank  holding  company of a bank that is located in another
state without regard as to whether the acquisition is prohibited  under the laws
of any state.  Again,  state  minimum age laws for banks to be acquired  will be
preserved  unless the state law  provides  for a minimum age period of more than
five years. The Federal Reserve may not approve an interstate  acquisition which
would result in the acquiror's  controlling more than 10% of the total amount of
deposits of insured  depository  institutions  in the United  States with 30% or
more of the deposits in the home state of the target bank. A state may waive the
30% limit  based on  criteria  that does not  discriminate  against out of state
institutions.  The limitations do not apply to the initial entry into a state by
a bank holding  company  unless the state has a deposit  concentration  cap that
applies on a  nondiscriminatory  basis to in state or out of state bank  holding
companies  making  an  initial   acquisition.   Notwithstanding  the  foregoing,
anti-trust laws are not affected by the Interstate Banking Act.

The Interstate  Bank Act now provides that banks may establish  branches  across
state lines upon  approval of the  appropriate  federal  regulator  if the state
"opts-in" by enacting  legislation  that  expressly  permits de novo  interstate
branching. The establishment of the initial branch in a host state which permits
de novo interstate  branching is subject to the same requirements which apply to
the  initial  acquisition  of a bank in a host  state,  other  than the  deposit
concentration  limits, since the bank would not control any deposits in the host
state  at the time of  entry.  Once a branch  has  been  established  by de novo
branching,  the  bank may  establish  and  acquire  additional  branches  at any
location  in the host  state in the same  manner  as any bank in the host  state
could have established or acquired under applicable federal or state law.

The scope of regulation and  permissible  activities of the Company and the Bank
is subject to change by future federal and state legislation.
<PAGE>
                                       8


Recent Regulatory Developments
------------------------------

On  September  3,  1996,  President  Clinton  signed  the  Omnibus  Consolidated
Appropriations Act for the fiscal year 1997. Subtitle G of Title Two of that Act
is titled the "Deposit  Insurance  Funds Act of 1996" (Deposit  Insurance  Funds
Act),  which among other  things  provides for the  recapitalization  of Savings
Association  Insurance  Fund ("SAIF") as of October 1, 1996. To accomplish  this
recapitalization,  the  FDIC  imposed  a  special  assessment  on  each  insured
depository  institution  with  deposits  assessable  under the SAIF so that SAIF
would achieve its  designated  reserve ratio (DRR) on the first  business day of
the first month after the date of the enactment of the Deposit  Insurance  Funds
Act.  Because the  legislation  was enacted as of September 30, 1996,  under the
Deposit  Insurance Funds Act, SAIF achieved its DRR and became fully capitalized
on October 1, 1996.  For purpose of the SAIF special  assessment,  the amount of
SAIF-assessable  deposits is determined as of March 31, 1995. However,  the term
"SAIF-assessable deposits" includes deposits assumed after March 31, 1995 if the
deposits  were assumed from an  institution  that is no longer  insured when the
special   assessment  to  recapitalize  SAIF  is  imposed  under  this  section.
Therefore,  some institutions will be required to pay the special  assessment on
SAIF insured deposits that were assumed after March 31, 1995.

A major  part of the plan to  recapitalize  SAIF  involves  imposing  a one-time
special  assessment  on  SAIF-assessable  deposits  that  may  be  paid  in  two
installments under certain conditions. Subject to certain statutory adjustments,
the FDIC  has  discretion  to  determine  the  rates  of the  assessments  after
considering  certain  factors,  including the most recent SAIF balance,  data on
insured deposits,  and any other factors that the FDIC deems  appropriate.  This
one-time special assessment is subject to certain  exceptions,  and the FDIC has
discretion to issue orders exempting weak  institutions from paying this special
assessment if the exemption  will reduce the risk to SAIF.  The FDIC  prescribed
guidelines  for issuing  such an  exemption  within 30 days of  enactment of the
Deposit  Insurance  Funds Act. The Act required  FDIC to exempt from the special
assessment  (1)  institutions  that  existed on October 1, 1995 and held no SAIF
assessable  deposits  before  January 1, 1993,  (2) federal  savings banks newly
established in April,  1994 to acquire the deposits of savings  institutions  in
default  that  received   assistance   from  the  RTC  in  connection  with  the
transactions,  and (3) an SAIF insured savings  association that, before January
1, 1987,  was a federal  savings  bank  insured by the FSLIC for the  purpose of
acquiring  the  assets or  assuming  the  liabilities  of a  national  bank in a
transaction  consummated  after  July 1,  1986 and had  assets  less  than  $150
million.   Exempt  institutions   generally  are  required  to  pay  semi-annual
assessments  at former rates under the schedule  applicable to SAIF fund members
on June 30, 1995, with certain exceptions.

There are three statutory adjustments that the FDIC must consider in setting the
SAIF  recapitalization  rates. The first of these relates to Oakar transactions,
which are  generally  defined  to  include  bank  purchases  of  SAIF-assessable
deposits. Generally, Bank Insurance Fund (BIF) members acquiring SAIF-assessable
deposits in Oakar  transactions prior to March 31, 1995 (or after March 31, 1995
if the institution from which the deposits were acquired is no longer insured at
the time the special  assessment  is  imposed),  are subject to the SAIF special
assessment  but  the  amount  of  assessable   deposits   would,  as  a  general
proposition,  be  reduced  by 20% for  purposes  of the  assessment  if  certain
conditions  are  satisfied.  The 20% haircut  for these BIF members  applies for
purposes  of the  special  assessment  and for  purposes  of future  semi-annual
assessments  on  SAIF-assessable  deposits that were acquired prior to March 31,
1995.  To be eligible  for the 20% haircut,  a BIF member must  satisfy  certain
requirements  that are based on a suggested  attributable  deposit  amount as of
June 30, 1995.

The second statutory adjustment the FDIC must consider for purposes of computing
this special assessment  relates to "converted  associations," a term defined by
the Act. An  institution  meeting  one of the Act's  definitions  of  "converted
association" may also reduce by 20% the amount of deposits that are SAIF insured
as of March  31,  1995 (or  after  March  31,  1995 is  subject  to the  special
assessment  because the institution  from which the deposits were acquired is no
longer  insured at the time the special  assessment is imposed).  In addition to
"converted associations," Sasser banks - a savings association that converted to
a bank charter prior to SAIF reaching its DRR and as a result the resulting bank
was required to remain an SAIF member - may qualify under this second adjustment
under very limited criteria.
<PAGE>
                                       9


Third, if payment of the special  assessment  would pose a significant risk that
an insured depository institution or its holding company may default on payments
under debt  obligations or preferred stock, the institution may elect to pay the
special  assessment  under  extended  terms  that would  include a  supplemental
special assessment.

The SAIF was initially  capitalized  through the issuance of bond obligations by
the  Financing  Corporation  (FICO),  commonly  referred to as FICO  bonds.  The
Deposit  Insurance  Funds Act also addresses  repayment of the interest on those
bonds.   Beginning  with  the  semi-annual  periods  after  December  31,  1996,
assessments  to pay  approximately  $8 million in interest on FICO bonds will be
shared among all insured  depository  institutions,  including  insured national
banks,  instead of only SAIF members. For purposes of the assessments to pay the
interest on the FICO bonds,  BIF-assessable  deposits will be assessed at a rate
of 20% of the  assessment  rate  applicable to  SAIF-assessable  deposits  until
December 31,  1999.  After the earlier of December 31, 1999 or the date the last
savings  association  ceases to exist, full pro rata sharing of FICO assessments
will begin.

For purposes of paying the interest on the FICO bonds, "BIF-assessable deposits"
means   deposits   that  are  subject  to   assessments   under  BIF.  The  term
"SAIF-assessable  deposits"  means deposits that are  assessable  under SAIF and
includes  any  deposits  that were  assumed  after March 31, 1995 if the insured
institution  from which the deposits  were acquired is not insured when the SAIF
special assessment is imposed.

The Deposit  Insurance Funds Act also provides that, as of the date of enactment
and ending on the earlier of December 31, 1999 or the date that the last savings
association  ceases to exist, the federal banking agencies must take appropriate
action to prohibit  deposit  shifting  from SAIF to BIF,  including  enforcement
actions,  denial of  applications,  or imposing exit and interest fees as if the
transaction  qualified as a conversion.  The legislation  requires the office of
the comptroller of the currency,  the FDIC, the Federal  Reserve Board,  and the
Office of Thrift  Supervision  to take  necessary  actions  to  prevent  insured
depository  institutions  and  depository  institution  holding  companies  from
facilitating  or encouraging  the shifting of deposits from  SAIF-assessable  to
BIF-assessable for purpose of evading the assessments imposed on SAIF-assessable
deposits.  The FDIC may issue regulations to prevent deposit  shifting.  It is a
rule of construction,  however, that this portion of the Deposit Insurance Funds
Act does not prohibit an  institution  from engaging in conduct or activity that
is part of the ordinary  course of business and is not directed at depositors of
an insured affiliated institution.

The Deposit  Insurance  Funds Act also  provides  for the merger of BIF and SAIF
into Deposit  Insurance Fund (DIF) on January 1, 1999, if no insured  depository
institutions  a  "savings  association"  on that  date.  If an  insured  savings
association  still exists on January 1, 1999,  the Deposit  Insurance  Funds Act
does not make  provision  for the  merger of the funds to occur on a  subsequent
date. For purposes of the IF/SERIF  merger,  the term "savings  association"  is
defined  as  having  the same  meaning  as it does in & 3(b) of the FDIC Act (12
U.S.C.  ss  1813  (b)),  and  thus  includes  both  federal  and  state  savings
associations.

If  immediately  before the merger,  the SAIF reserve ratio exceeds the DRR, the
excess will be placed in DIF's special  reserve.  While the DIF special  reserve
will not be included  for purposes of  calculating  the DIF DRR and the FDIC can
not refund any amount in the special reserve, it can be drawn upon for emergency
purposes if the reserve  ratio of the DIF should drop below 50% of its DRR for a
sustained  period of time.  This  portion of the  Deposit  Insurance  also makes
conforming  changes to the FDIC Act and other  provisions  of law  effective  on
January 1, 1999 if the funds are so  merged.  If the funds are not  merged,  the
Deposit  Insurance Fund Act establishes an SAIF special reserve as of January 1,
1999 that will  consist  of the excess in the SAIF over the DRR as of that date.
While the amount in the SAIF  special  reserve can not be used for refunds  from
the SAIF, it would be available  for emergency  purposes if the reserve ratio of
the SAIF is less than 50% of its DRR for a sustained period of time.
<PAGE>
                                       10


The Deposit Insurance Funds Act also required the FDIC on such basis as it deems
appropriate to refund any amounts in excess of the DRR to BIF members and, after
it is established,  to DIF members.  There are no similar provisions for refunds
to SIF  members.  A  member  can  not,  however,  receive  any  refund  for  any
semi-annual  assessment  period  that  exceeds the  assessment  paid during that
period.  Institutions  that  are  not  "well-capitalized"  or  that  have  other
weaknesses are not eligible for refunds.  The refund provision becomes effective
as of the end of any semi-annual  assessment  period beginning after the date of
enactment of the Deposit Insurance Funds Act.

Item 2.  Properties.
--------------------

The  executive  offices  and the Bank  facility  are  located on Ford  Avenue in
Richmond Hill,  Georgia on approximately 2.8 acres of land. The building,  which
is owned by Bryan Bank & Trust and carried as an asset on its balance sheet,  is
two stories with  approximately  8,700  square feet.  The lobby with five teller
windows and several service desks, the executive and lending  offices,  the loan
department  and the vault which  contains 700 safe  deposit  boxes for rental to
Bank customers are located on the ground floor. The accounting  operations and a
conference  room are  located  on the  second  floor.  The  building  also has a
drive-in teller window.

Item 3.  Legal Proceedings.
---------------------------

There are no pending  legal  proceedings  to which the  Company or the Bank is a
party or of which any of their properties are subject; nor are there proceedings
known to the Company to be contemplated by any governmental  authority;  nor are
there  proceedings known to the Company,  pending or contemplated,  in which any
director, officers or affiliate or any principal security holder of the Company,
or any associate of the  foregoing is a party or has an interest  adverse to the
Company or the Bank.

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

No matter was submitted  during the fourth  quarter ended December 31, 1997 to a
vote of security holders of the Company.

<PAGE>
                                       11


                                     PART II

Item 5.  Market or Registrant's Common Equity and Related
---------------------------------------------------------
         Stockholder Matters.
         --------------------

The Company has  maintained  partial  records of share  prices based upon actual
transactions disclosed.  However, these records are incomplete since they do not
reflect prices for all  transactions in the common stock of the Company.  To the
extent such  information has been disclosed to the Company,  the share prices of
the common stock of the Company is as follows:

<TABLE>
<CAPTION>

            ====================================================================
                                                        Selling Price
                               Year
            ====================================================================
                                                   High ($)         Low ($)
            ====================================================================
            1997
            <S>                                     <C>              <C>
            First quarter                           25               25
            ====================================================================
            Second quarter                          25               25
            ====================================================================
            Third quarter                           25               25
            ====================================================================
            Fourth quarter                          25               25
            ====================================================================
            1996
            First quarter                           20               18
            ====================================================================
            Second quarter                          N/A              N/A
            ====================================================================
            Third quarter                           N/A              N/A
            ====================================================================
            Fourth quarter                          20               20
            ====================================================================
</TABLE>

During the period covered by this report,  there has been no established  public
trading market for the Company's common stock.

As of March 2,  1998,  the  approximate  number  of  holders  of  record  of the
Company's common stock was 413.

The Company has paid cash dividends on an annual basis since 1994.  During 1997,
the Company paid a cash  dividend of $.85 per share.  In the second  quarters of
1996 and 1995, the Company paid cash dividends totaling $.70 and $.60 per share,
respectively.  The Company expects to continue paying annual dividends, although
there is no  assurance  as to future  dividends  because they will depend on the
future earnings,  capital  requirements,  financial  condition and other factors
considered relevant by the Board of Directors of the Company.

The  Company's  ability to pay dividends  will depend  entirely on the amount of
dividends paid by the Bank and any other  subsequently  acquired  entities.  The
Bank is, and such other entities may be, subject to regulatory  restrictions  on
the payment of dividends.  The Bank is subject to restrictions on the payment of
dividends under Georgia law and Georgia Banking Department regulations. Pursuant
to  regulations  adopted by the  Georgia  Banking  Department,  a bank needs the
approval of the Georgia Banking  Department to pay cash dividends if at the time
of such  payment (i) total  classified  assets  exceed 80% of the bank's  equity
capital  (which  included the aggregate  par value of all common stock,  paid in
surplus,  retained earnings,  capital reserves and reserves for loan losses), or
(ii) the  aggregate  amount of  dividends to be paid or  anticipated  to be paid
during the calendar  year exceeds 50% of the net  after-tax  profits of the bank

<PAGE>
                                       12


for the previous calendar year, or (iii) the ratio of equity capital (as defined
above) to  adjusted  total  assets is less than six  percent  (6%).  The Georgia
Business Corporation Code permits payment of dividends to shareholders in money,
indebtedness or other property unless, after giving effect to such distribution,
the  corporation  would not be able to pay its debts as they  became  due in the
usual  course of business or the  corporation's  total assets would be less than
the sum of its total  liabilities  plus the  amount  that would be needed if the
corporation  were to be  dissolved  at the time of  distribution  to satisfy the
preferential  rights upon dissolution of shareholders whose preferential  rights
are superior to those receiving the distribution.


Item 6. Management's  Discussion and Analysis of Financial Condition and Results
--------------------------------------------------------------------------------
        of Operations.
        --------------

The following  analysis  reviews the important  factors  affecting the financial
condition  and results of  operations  of Bryan  Bancorp  (the  "Company").  The
Company owns all of the outstanding  stock of Bryan Bank and Trust (the "Bank").
The financial position, results of operations, and the cash flows of the Company
are primarily  related to the Bank.  This review  should be read in  conjunction
with the consolidated financial statements and related notes.

LIQUIDITY AND INTEREST RATE SENSITIVITY

The primary  functions  of  asset/liability  management  are to assure  adequate
liquidity and maintain an appropriate balance between interest-sensitive earning
assets and interest-bearing  liabilities. The goal of liquidity management is to
ensure  the  availability  of  adequate  funds to meet the loan  demand  and the
deposit  withdrawal needs of the Company's  customers.  This is achieved through
maintaining a combination of sufficient  liquid assets,  core deposit growth and
unused  capacity  to  purchase  funds  in  the  money  markets.   Interest  rate
sensitivity  management  seeks to avoid  fluctuating net interest margins and to
enhance  consistent  growth of net interest  income through  periods of changing
interest rates.

The Company meets most of its daily  liquidity  needs through the  management of
cash and federal funds sold.  The Company  continues to be in a liquid  position
with approximately  $2,000,000 in cash and due from banks and federal funds sold
at  December  31,  1997.   The  Company's   Federal  funds  sold   decreased  by
approximately  $5,500,000 in 1997. Approximately $4,000,000 of this decrease was
the  result of the  Company  investing  in U.S.  Agencies  bonds  with  callable
features of three and six months plus approximately  another $1,000,000 invested
in short-term  certificates of deposits in other banks. During 1997, the Company
was able to fund its continued  demand for loans which  increased  approximately
$6,000,000  with cash  generated  from  operating  activities  of  approximately
$1,400,000,   deposit  growth  of  approximately   $3,400,000  and  advances  of
$1,200,000 from the Federal Home Loan Bank.

In addition to the  Company's  credit line with the Federal Home Loan Bank which
allows  advances  up to  seventy-five  percent of the book value of  one-to-four
family first  mortgage  loans.  The Company also has the ability on a short-term
basis to  purchase  funds  from other  financial  institutions.  Presently,  the
Company  has  federal  funds line of credit  arrangements  with other  financial
institutions aggregating $4,000,000.

There are no trends, demands,  commitments,  events or uncertainties that should
result  in or  are  reasonably  likely  to  result  in the  Company's  liquidity
increasing or decreasing in any material way.

Interest rate  sensitivity  varies with the different types of  interest-earning
assets and interest-bearing liabilities.  Overnight federal funds on which rates
change daily and loans which are tied to the prime rate differ considerably from
long-term investment securities and fixed-rate loans.  Similarly,  time deposits
over $100,000 or more sensitive than regular savings accounts.  The shorter-term
interest rate sensitivities are key to measuring the interest sensitivity gap.
<PAGE>
                                       13


Management  monitors the  Company's  asset and  liability  positions in order to
maintain a balance between rate-sensitive assets and rate-sensitive  liabilities
and at the same time maintain sufficient liquid assets to meet expected customer
needs for loans and for withdrawals of deposits.

The following table shows the interest  sensitivity gaps for four different time
intervals as of December 31, 1997:

<TABLE>
<CAPTION>
                                                              Term to Repricing on Maturity
                                                                     (in thousands)
                                  --------------------------------------------------------------------------------------

                                        0-90            91-365          One-Five         Over Five
                                        days             days             Years            Years            Total
                                  --------------------------------------------------------------------------------------
<S>                                  <C>             <C>             <C>            <C>            <C>

Interest earning assets:
Interest-bearing deposits
  with other banks ...............   $    495,000    $    495,000                                  $    990,000
Federal Funds Sold ...............         38,000                                                        38,000
Available for sale securities ....                        198,498       6,491,884      2,615,260      9,305,642
Held to maturity securities ......                                      1,117,362      2,228,257      3,345,619
Loans ............................      9,199,773      15,995,613      21,768,267      1,300,318     48,263,971
                                     ------------    ------------    ------------   ------------   ------------
Total interest earning assets ....      9,732,773      16,689,111      29,377,513      6,143,835     61,943,232
                                     ------------    ------------    ------------   ------------   ------------
Interest bearing liabilities:
NOW deposits .....................     11,071,611                                                    11,071,611
Money market deposits ............      2,093,881                                                     2,093,881
Savings deposits .................      7,024,668                                                     7,024,668
Time deposits ....................      7,524,940      16,681,350       3,898,311                    28,104,601
FHLB advances ....................          6,250          58,750       1,260,000        265,000      1,590,000
Other borrowed funds .............        130,000                                                       130,000
                                     ------------    ------------    ------------   ------------   ------------
Total interest bearing liabilities     27,851,350      16,740,100       5,158,311        265,000     50,014,761
                                     ------------    ------------    ------------   ------------   ------------

Interest Rate Sensitivity Gap ....   $(18,118,577)   $    (50,989)   $ 24,219,202   $  5,878,835   $ 11,928,471
                                     ============    ============    ============   ============   ============
</TABLE>

As  indicated in the above table,  the first  twelve  months  reflect a negative
cumulative  gap position.  A negative gap position  indicates that the Company's
rate sensitive  liabilities will reprice faster than its rate sensitive  assets.
While the Company's  rate  sensitive  liabilities  reprice more quickly than the
rate  sensitive  assets during the next twelve  months,  this position  reverses
after year one to a positive gap position.  The near term liability  sensitivity
will  usually  result in a lower net margin when rates  increase.  However,  the
Company's net interest margin not only depends on the direction and magnitude of
future rates, but also customer alternatives and need for liquidity.

The interest rate sensitivity  table presumes that all loans and securities will
perform according to their contractual maturities when, in reality,  actual loan
terms are much shorter than the original terms and in many cases  securities are
subject  to early  redemption.  In  addition,  the  table  does not  necessarily
indicate the impact of general  interest rate  movements on net interest  margin
since  the  repricing  categories  of  assets  and  liabilities  is  subject  to
competitive pressures and customers needs.


CAPITAL RESOURCES

The Company continues to maintain a satisfactory  level of capital which exceeds
regulatory requirements and is available to support future growth. The Company's
level of capital can be measured by its average  equity to average  assets ratio
at December 31, 1997 and 1996 of 11.36% and 11.84%, respectively.
<PAGE>
                                       14


Shareholders'  equity increased  $650,375 during 1997, an increase in book value
from $13.42 at December  31, 1996 to $14.75.  The Company  recorded net earnings
for 1997 of  $1,157,766  and paid  cash  dividends  of $.85 per  share  totaling
$428,704.  The Company also purchased 8,050 shares of treasury stock during 1997
at a cost of $200,250.

The Company and the Bank are subject to various regulatory capital  requirements
administered  by the federal banking  agencies.  Failure to meet minimum capital
requirements   can  initiate   certain   mandatory   and   possible   additional
discretionary  actions by regulators  that, if  undertaken,  could have a direct
material effect on the Company's  financial  statements.  Under capital adequacy
guidelines and the regulatory  framework for prompt corrective  action, the Bank
must meet specific capital guidelines that involve quantitative  measures of the
Company's assets, liabilities, and certain off-balance sheet items as calculated
under regulatory  accounting  practices.  The Company's  capital amounts and the
classification are also subject to qualitative judgments by the regulators about
components,   risk  weightings,   and  other  factors.   Quantitative   measures
established by regulation to ensure capital adequacy require the Company and the
Bank to maintain minimum amounts and ratios of Tier 1 capital (as defined in the
regulations)  to total average  assets (as defined) and minimum ratios of Tier 1
and total capital (as defined) to risk-weighted assets (as defined).  Management
believes,  as of  December  31,  1997,  that the  Company  and the Bank meet all
capital adequacy requirements to which it is subject.

Management is not aware of any required regulatory changes or any recommendation
by any regulatory  authority  which will have a material effect on the Company's
liquidity, capital, or results of operations.


RESULTS OF OPERATIONS

The following  discussion and analysis  summarizes the more significant  factors
affecting operations for 1997 compared to 1996:

Net Interest Income
The Company's results of operations are determined by its ability to effectively
manage interest income and expense,  to minimize loan and investment  losses, to
generate noninterest income and to control noninterest  expense.  Since interest
rates are determined by market forces and economic conditions beyond the control
of  management.  The  Company's  ability  to  generate  net  interest  income is
dependent upon its ability to obtain an adequate net interest spread between the
rate paid on  interest  bearing  liabilities  and the rate  earned  on  interest
earning assets.

Net interest income was $3,275,804 in 1997, representing an increase of $363,933
or 12.5% as compared to 1996. The average yield on  interest-earning  assets was
9.54%  in  1997  compared  to  9.48%  in  1996  and  the  average  rate  paid on
interest-bearing  liabilities  was 4.87% in 1997 compared to 4.81% in 1996.  The
Company's  net  interest   margin  (net  interest   income  divided  by  average
interest-bearing  assets)  equaled 5.65% in 1997 compared to 5.72% in 1996.  The
current year  increase in net interest  income  resulted  primarily  from volume
increase in the loan portfolio.

Noninterest Income
Noninterest income increased $171,661 or 31,31% in 1997 over 1996. This increase
is primarily  attributable to increases in loan  origination fees as a result of
the  establishment of a mortgage loan origination  service in the 4th quarter of
1996. Fees from this service in 1997 were $123,170.

Noninterest Expense
Noninterest expense increased $237,151 or 12.88% in 1997 over 1996. Salaries and
employee  benefits  was  the  largest  component  of  non-interest  expense  and
increased  $210,715 in 1997 over 1996.  The  increase in salaries  and  employee
benefits was due  primarily to the growth in the  operations of the Bank and the
need to add additional employees as well as normal salary increases.
<PAGE>
                                       15


Net noninterest expense (defined as noninterest expense less noninterest income)
as a percentage of average assets was 1.7% in 1997 compared to 1.8% in 1996. The
efficiency ratio (noninterest  expense divided by the sum of net interest income
after  provision  for loan  losses and  non-interest  income) was 54% in 1997 as
compared to 55% in 1996.  Management  will  continue to focus on  improving  the
non-interest  fee  income  of  the  Company  as it  closely  monitors  operating
expenses.

Income Taxes
The  provision  for  income  taxes was  $580,000  in 1997 and  $508,000  in 1996
representing an effective tax rate of approximately 33% for 1996 and 1997.


Impact of New Accounting Standards

In June 1997, the Financial  Accounting Standards Board (FASB) issued Statements
of  Financial  Accounting  Standards  (SFAS)  No. 130  "Reporting  Comprehensive
Income" This  statement  established  standards  for  reporting  and  displaying
comprehensive  income  and  its  components  in a full  set  of  general-purpose
financial  statements.  This is  effective  for  fiscal  years  beginning  after
December  15,  1997.  The Company  does not expect any  material  changes to its
current reporting format in response to this statement.

In June 1997,  the  Financial  Accounting  Standards  Board  issued SFAS No. 131
"Disclosure  about  Segments of an Enterprise  and Related  information"  and is
effective for fiscal years  beginning  after  December 15, 1997.  This statement
establishes  standards  for  reporting  operating  segments  by public  business
enterprises in annual financial  statements and requires that those  enterprises
report  selected  information  about  operating  segments  in interim  financial
reports to  shareholders.  The adoption of this statement will have no effect on
the financial statements of the Company.



<PAGE>
                                       16


DISTRIBUTION OF ASSETS,  LIABILITIES,  AND SHAREHOLDERS' EQUITY;  INTEREST RATES
AND INTEREST DIFFERENTIAL


The following  tables set forth selected  statistical  information and should be
read in conjunction with the consolidated  financial statements of Bryan Bancorp
of Georgia, Inc. (the "Company") and subsidiary (the "Bank").

     Table 1 - Average Consolidated Balance Sheets

     The following table is a presentation of the average  consolidated  balance
     sheets of the Company and includes all major categories of interest-earning
     assets and interest-bearing liabilities:

<TABLE>
<CAPTION>
                                                            December 31,
                                                     -------------------------
                                                         1997          1996
                                                     -----------   -----------
     ASSETS
     <S>                                             <C>           <C>
     Interest-bearing deposits ...................   $   204,950   $   171,913
     Investment securities available for sale ....     6,983,629     5,309,840
     Investment securities held to maturity ......     3,299,890     3,159,082
     Federal funds sold ..........................     2,116,980     2,678,352
     Loans .......................................    45,415,034    39,578,412
                                                     -----------   -----------
       Total interest-earning assets .............    58,020,483    50,897,599
     Cash and due from banks .....................     2,026,645     2,476,436
     Other assets ................................     1,441,973     1,278,284
                                                     -----------   -----------
        Total assets .............................   $61,489,101   $54,652,319
                                                     ===========   ===========
     LIABILITIES AND SHAREHOLDERS' EQUITY
     NOW deposits ................................   $ 9,923,986   $ 9,291,178
     Money market deposits .......................     2,142,774     1,690,102
     Savings deposits ............................     6,841,337     6,945,750
     Time deposits ...............................    26,308,611    21,465,200
     Short-term borrowings .......................     1,128,833       441,153
                                                     -----------   -----------
       Total interest-earning liabilities ........    46,345,541    39,833,383
     Non-interest bearing deposits ...............     7,645,612     7,839,227
     Other liabilities ...........................       508,032       508,553
                                                     -----------   -----------
        Total liabilities ........................    54,499,185    48,181,163
                                                     -----------   -----------
     Shareholders' equity ........................     6,989,916     6,471,156
                                                     -----------   -----------
        Total liabilities and shareholders' equity   $61,489,101   $54,652,319
                                                     ===========   ===========
</TABLE>
<PAGE>
                                       17


     Table 2 - Net Interest Earnings

     The  following  table is an  analysis of the net  interest  earnings of the
     Company with respect to each major category of interest-earning  assets and
     interest-bearing liabilities:

<TABLE>
<CAPTION>
     YEAR ENDED DECEMBER 31,1997:
     --------------------------------------------
                                                                  Average        Interest      Average
                                                                   Amount         Earned        Yield
                                                                -----------    -----------    --------
     Assets
     <S>                                                        <C>            <C>            <C>
     Interest-bearing deposits ..............................   $   204,950    $    11,407       5.57%
     Investment securities available for sale ...............     6,983,629        453,930       6.50%
     Investment securities held to maturity .................     3,299,890        172,070       5.21%
     Federal funds sold .....................................     2,116,980        116,313       5.49%
     Loans ..................................................    45,415,034      4,781,290      10.53%
                                                                -----------    -----------
        Total earning assets ................................    58,020,483      5,535,010       9.54%
                                                                ===========    -----------

                                                                  Average        Interest      Average
                                                                   Amount         Earned        Yield
                                                                -----------    -----------    --------
     Liabilities
     NOW deposits ...........................................     9,923,986        380,313       3.83%
     Money market deposits ..................................     2,142,774         81,398       3.80%
     Savings deposits .......................................     6,841,337        239,388       3.50%
     Time deposits ..........................................    26,308,611      1,485,092       5.64%
     Short-term borrowings ..................................     1,128,833         73,015       6.47%
                                                                -----------    -----------
        Total interest bearing liabilities ..................   $46,345,541      2,259,206       4.87%
                                                                ===========    -----------
     Net interest income ....................................                  $ 3,275,804
                                                                               ===========
     Net yield on interest earning assets ...................                                    5.65%
                                                                                              ========
</TABLE>

<TABLE>
<CAPTION>

     YEAR ENDED DECEMBER 31,1996:
     --------------------------------------------
                                                                  Average        Interest      Average
                                                                   Amount         Earned        Yield
                                                                -----------    -----------    --------
     <S>                                                        <C>            <C>            <C>
     Interest-bearing deposits ..............................   $   171,913    $     9,581       5.57%
     Investment securities available for sale ...............     5,309,840        323,735       6.10%
     Investment securities held to maturity .................     3,159,082        164,535       5.21%
     Federal funds sold .....................................     2,678,352        141,655       5.29%
     Loans ..................................................    39,578,412      4,187,876      10.58%
                                                                -----------    -----------
         Total earning assets ................................    50,897,599      4,827,382       9.48%
                                                                -----------    -----------

                                                                  Average        Interest      Average
                                                                   Amount         Earned        Yield
                                                                -----------    -----------    --------
     NOW deposits ...........................................     9,291,178        347,055       3.74%
     Money market deposits ..................................     1,690,102         64,286       3.80%
     Savings deposits .......................................     6,945,750        243,010       3.50%
     Time deposits ..........................................    21,465,200      1,233,742       5.75%
     Short-term borrowings ..................................       441,153         27,418       6.22%
                                                                -----------    -----------
        Total interest bearing liabilities ..................   $39,833,383      1,915,511       4.81%
                                                                -----------    -----------
     Net interest income ....................................                  $ 2,911,871
     Net yield on interest earning assets ...................                  -----------       5.72%
                                                                                              ========


<PAGE>
                                       18


<FN>
     Includes  impaired  loans of $304,000  and  $56,000  during the years ended
     December 31, 1997 and 1996, respectively.
</FN>
</TABLE>

     Table 3 - Rate/Volume Analysis of Net Interest Income

     The effect of changes in average  balances  (volume)  and rates on interest
     income,  interest  expense,  and  net  interest  income,  for  the  periods
     indicated,  is shown below.  The effect of a change in average  balance has
     been  determined by applying the average rate in the earlier  period to the
     change in average balance in the later period, as compared with the earlier
     period. The effect of a change in the average rate paid has been determined
     by applying the average  balance in the earlier period to the change in the
     average rate paid in the later period, as compared with the earlier period.
     Changes  resulting  from  average  balance/rate  variances  are included in
     changes resulting from volume.


<TABLE>
<CAPTION>
                                                          December 31, 1997
                                                          Compared to 1996
                                                     Increase (Decrease) Due to
                                                -----------------------------------
                                                  Volume        Rate        Change
                                                ---------     --------    ---------
     Interest earned on:
     <S>                                        <C>          <C>          <C>
     Interest-bearing deposits ..............   $   1,826                 $   1,826
     Investment securities available for sale     108,956       21,239      130,195
     Investment securities held to maturity .       7,535                     7,535
     Federal funds sold .....................     (30,699)       5,357      (25,342)
     Loans ..................................     613,203      (19,789)     593,414
                                                ---------    ---------    ---------
        Total interest income ...............     700,821        6,807      707,628
                                                ---------    ---------    ---------


     Interest paid on:
     Now deposits ...........................      24,896        8,362       33,258
     Money market deposits ..................      17,112                    17,112
     Savings deposits .......................      (3,622)                   (3,622)
     Time deposits ..........................     274,962      (23,612)     251,350
     Short-term borrowings ..................      44,494        1,103       45,597
                                                ---------    ---------    ---------
        Total interest expense ..............     357,842      (14,147)     343,695
                                                ---------    ---------    ---------
     Change in net interest income...........   $ 342,979    $  20,954    $ 363,933
                                                ---------    ---------    ---------
</TABLE>
<PAGE>
                                       19


<TABLE>
<CAPTION>
                                                          December 31, 1996
                                                          Compared to 1995
                                                     Increase (Decrease) Due to
                                                -----------------------------------
                                                  Volume        Rate        Change
                                                ---------     --------    ---------
     Interest earned on:
     <S>                                        <C>          <C>          <C>
     Interest-bearing deposits ..............   $  (2,801)   $     250    $  (2,551)
     Investment securities available for sale     (45,695)       5,277      (40,418)
     Investment securities held to maturity .       4,743          699        5,442
     Federal funds sold .....................      98,588       (3,632)      94,956
     Loans ..................................     378,955      (37,329)     341,626
                                                ---------    ---------    ---------
        Total interest income ...............     433,790      (34,735)     399,055
                                                ---------    ---------    ---------

     Interest paid on:
     Now deposits ...........................      27,268      (13,869)      13,399
     Money market deposits ..................      10,942          145       11,087
     Savings deposits .......................     (15,543)                  (15,543)
     Time deposits ..........................     230,462        2,793      233,255
     Short-term borrowings ..................     (77,371)     (22,052)     (99,423)
                                                ---------    ---------    ---------
        Total interest expense ..............     175,758      (32,983)     142,775
                                                ---------    ---------    ---------
     Change in net interest income...........   $ 258,032    $  (1,752)   $ 256,280
                                                ---------    ---------    ---------
</TABLE>
<PAGE>
                                       20



INVESTMENTS

As of December 31, 1997 investment securities comprised approximately 19% of the
Company's  assets  and  loans  comprised  approximately  74% of the  assets.  In
addition,  the  Bank  has  entered  into  Federal  Funds  transactions  with its
principal  correspondent banks, and acts as a net seller of such funds. The sale
of Federal Funds amounts to a short-term loan from the Bank to another bank.

Investment  securities  available for sale (carried at estimated fair value) and
held to maturity  (carried at amortized  cost) at December 31, 1997 and 1996 are
present in the following table:

<TABLE>
<CAPTION>

                                                   Available For Sale securities
                                        -------------------------------------------------
                                         Amortized    Unrealized   Unrealized     Fair
                                            Cost         Gains       Losses       Value
                                        -------------------------------------------------
     <S>                                 <C>          <C>          <C>          <C>
     December 31, 1997:
     U.S. Treasury and
       U.S. Government agencies          $6,148,779   $   22,356   $    1,502   $6,169,633
     Mortgage-backed securities          3,167,546       15,946       47,483    3,136,009
                                        ----------   ----------   ----------   ----------
     Total ....................         $9,316,325   $   38,302   $   48,985   $9,305,642
                                        ----------   ----------   ----------   ----------
     December 31, 1996:
     U.S. Treasury and
       U.S. Government agencies         $1,399,708   $       60   $    1,361   $1,398,407
     Mortgage-backed securities          3,928,861       20,054       64,106    3,884,809
                                        ----------   ----------   ----------   ----------
     Total debt securities ....          5,328,569       20,114       65,467    5,283,216
     Equity securities ........              6,156                                  6,156
                                        ----------   ----------   ----------   ----------
     Total ....................         $5,334,725   $   20,114   $   65,467   $5,289,372
                                        ----------   ----------   ----------   ----------

</TABLE>

<TABLE>
<CAPTION>
                                                         Held To Maturity
                                        -------------------------------------------------
                                         Amortized    Unrealized   Unrealized     Fair
                                            Cost         Gains       Losses       Value
                                        -------------------------------------------------
     <S>                                 <C>          <C>          <C>          <C>
     December 31, 1997:
     State and political subdivisions   $3,165,919   $  120,720   $       --   $3,286,639
     Other securities ...............      179,700                                179,700
                                        ----------   ----------   ----------   ----------
     Total ..........................   $3,345,619   $  120,720   $       --   $3,466,339
                                        ----------   ----------   ----------   ----------
     December 31, 1996:
     State and political subdivisions   $3,038,000   $  136,335   $      215   $3,174,120
     Other securities ...............      156,200                                156,200
                                        ----------   ----------   ----------   ----------
     Total ..........................   $3,194,200   $  136,335   $      215   $3,330,320
                                        ----------   ----------   ----------   ----------

</TABLE>


<PAGE>
                                       21


     The  following  table sets forth the  maturities  and the weighted  average
     yield of each type of investment  securities on an amortized  cost basis at
     December 31, 1997.

<TABLE>
<CAPTION>

                                                   After one        After Five
                                     Within     year but within  years but within   After
                                    one year       five years       ten years     ten years      Total
                                 --------------------------------------------------------------------------
     <S>                         <C>               <C>           <C>             <C>          <C>
     Amount:
     U.S. Treasury and
        U.S. Government Agencies .$  198,498       $ 4,969,570   $ 1,001,565                  $6,169,633
     Mortgage-backed securities .                    1,522,314     1,613,695                   3,136,009
     State and municipal ........                    1,117,362     1,549,961       498,596     3,165,919
                                 -----------       -----------   -----------     ---------   -----------
                                     198,498       $ 7,609,246   $ 4,165,221     $ 498,596    12,471,561
                                 -----------       -----------   -----------     ---------   -----------
     Equity securities ..........                                                                179,700
                                                                                             -----------
                                                                                             $12,651,261
                                                                                             -----------
     Weighted average yield:
     U.S. Treasury and
       U.S. Government Agencies         4.87%             6.67%         7.07%
     Mortgage-backed securities                           6.70%         6.02%
     State and municipal                                  4.80%         5.28%         5.60%
                                 ----------------------------------------------------------
                                        4.87%             6.40%         5.99%         5.60%
                                 ==========================================================

</TABLE>


     There are no  investments in the  obligations of any state or  municipality
     which  exceed 10% of the  Company's  stockholders'  equity at December  31,
     1997.

     Distributions  of  maturities  for  mortgage-backed  securities is based on
     expected final maturities which may be different from contractual terms.


LOAN PORTFOLIO

The  Bank  engages  in  a  full  compliment  of  lending  activities,  including
commercial, consumer and real estate loans.

Commercial lending is directed  principally  towards businesses whose demand for
funds fall  within  the  Bank's  legal  lending  limits and which are  potential
deposit  customers of the Bank.  This category of loans  includes  loans made to
individual,  partnership or corporate  borrowers,  and obtained for a variety of
business purposes.

The Bank's  real  estate  loans  consist of  residential  and  commercial  first
mortgage loans, second mortgage financing,  and residential  construction loans.
This  category  of loans  also  includes  home  equity  loans  secured by second
mortgages on residences of borrowers  for a variety of purposes  including  home
improvements, education, and other personal expenditures.

The Bank's consumer loans consist  primarily of installment loans to individuals
for  personal,  family and household  purposes,  including  automobile  loans to
individuals and pre-approved lines of credit.

<PAGE>
                                       22


The following table present various  categories of loans contained in the Bank's
loan  portfolio  as of December  31,  1997 and 1996 and the total  amount of all
loans for such periods:

<TABLE>
<CAPTION>

                                                         Amount
                                              -----------------------------
    Type of Loan                                  1997            1996
    ---------------------------------------   -----------------------------
     <S>                                      <C>             <C>
     Domestic:
     Commercial, financial and agricultural   $  6,625,697    $  4,797,874
     Real estate construction .............      7,540,243       6,935,994
     Real estate mortgage .................     29,832,988      25,921,872
     Consumer .............................      4,198,126       4,604,519
                                              ------------    ------------
                                                48,197,054      42,260,259
     Allowance for loan losses ............       (583,432)       (454,820)
                                              ------------    ------------
                                              $ 47,613,622    $ 41,805,439
                                              ============    ============
</TABLE>




The  following  table shows the  maturities of certain loan types as of December
31, 1997. Also, provided are the amounts due after one year classified according
to the sensitivity to changes in interest rates.

<TABLE>
<CAPTION>


                                              Due in 1      Due in 1     Due After
                                           Year or Less    To 5 Years     5 years        Total
                                           ------------   -----------   -----------   -----------
<S>                                        <C>            <C>           <C>           <C>
   Commercial, financial and agricultural  $  3,205,163   $ 3,351,121   $    69,413   $ 6,625,697
   Real estate construction .............     7,489,614        50,629                   7,540,243
                                           ------------   -----------   -----------   -----------
     Total ..............................  $ 10,694,777   $ 3,401,750   $    69,413   $14,165,940
                                           ------------   -----------   -----------   -----------

Loans due after 1 year with predetermined interest rates  $   709,154                 $   709,154
Loans due after 1 year with floating rates                  2,692,596   $    69,413     2,762,009
                                                          -----------   -----------    ----------
                                                          $ 3,401,750   $    69,413   $ 3,471,163
                                                          -----------   -----------    ----------
</TABLE>


Accrual  of  interest  is  discontinued  on a loan when  management  of the Bank
determines,  upon  consideration  of economic  and  business  factors  affecting
collection efforts, that collection of interest is doubtful.

Impaired  loans  totaled  $304,000 and $56,000 as of December 31, 1997 and 1996,
respectively.

Interest  income which would have been recorded on impaired  loans had the loans
been current in accordance  with their original  terms and had been  outstanding
throughout  the period or since  origination  and the interest  income  actually
recorded was insignificant.

<PAGE>
                                       23


Allowance for Loan Losses

In  considering  the adequacy of  allowance  for  possible  loan  losses,  it is
management's  view that commercial  loans generally have greater risk than other
categories of loans in the loan portfolio.  However, the great majority of these
commercial  loans at December  31,  1997 and 1996 were made on a secured  basis,
such collateral consisting primarily of equipment.  Management believes that the
secured  condition of the preponderant  portion of its commercial loan portfolio
greatly reduces any risk of loss inherently present in commercial loans.

The Company's consumer loan portfolio is also well secured. At December 31, 1997
and  1996,  the  majority  of the  Company's  consumer  loans  were  secured  by
collateral  primarily  consisting  of  automobiles,  boats,  and other  personal
property.  Management  believes  that these loans  involve  less risk than other
categories of loans.

The Company's Board of Directors  monitors the loan portfolio  monthly to enable
it to evaluate the  adequacy of the  allowance  for loan  losses.  The loans are
rated and allowance  established based on the assigned rating. The provision for
loan  losses  charged  to  operating  expenses  is  based  on  this  established
allowance.  Factors  considered  by  the  Board  in  rating  the  loans  include
delinquent loans,  underlying  collateral value,  payment history, and local and
general economic conditions affecting collectibility.


SUMMARY OF LOAN LOSS EXPERIENCE

An analysis of the Bank's loan loss  experience  is furnished  in the  following
table for the years ended December 31, 1997 and 1996:

<TABLE>
<CAPTION>

                                                                   1997          1996
                                                                ---------     ---------
     <S>                                                        <C>           <C>
     Balance at beginning of year ...........................   $ 454,820     $ 427,662
                                                                ---------     ---------
     Charge-offs:
        Domestic -
          Commercial, financial and agricultural ............   $ (52,969)    $ (18,815)
          Real estate construction
          Real estate mortgage
          Consumer ..........................................     (69,811)      (70,844)
                                                                ---------     ---------
             Total charge-offs ..............................    (122,780)      (89,659)
                                                                ---------     ---------
     Recoveries:
        Domestic -
          Commercial, financial and agricultural ............      37,019
          Real estate construction
          Real estate mortgage ..............................                     2,160
          Consumer ..........................................      34,373        24,657
                                                                ---------     ---------
             Total recoveries ...............................      71,392        26,817
                                                                ---------     ---------
     Net (charge-offs) recoveries ...........................     (51,388)      (62,842)
     Additions charged to operations ........................     180,000        90,000
                                                                ---------     ---------
     Balance at end of year .................................   $ 583,432     $ 454,820
                                                                =========     =========

     Ratio of net charge-offs  (recoveries) during the period
     to average loans outstanding during the period .........        0.11%         0.16%
                                                                =========     =========

</TABLE>
<PAGE>
                                       24


     The Company's  allocation of the allowance for loan losses according to the
     amount deemed to be reasonably  necessary to absorb potential losses within
     each loan category and the percent of loans in each category to total loans
     is presented in the following tables:


<TABLE>
<CAPTION>
                                                         December 31,
                                                    --------------------
                                                      1997        1996
                                                    --------   ---------
     Allocation of Allowance for Loan  Losses
     by Loan Type
     ----------------------------------------
                                                      Amount     Amount
                                                    --------   --------
     <S>                                            <C>        <C>
     Commercial, financial and agricultural         $ 75,846   $ 54,578
     Real estate - construction ...........           93,349     72,772
     Real estate - mortgage ...............          361,728    277,440
     Consumer .............................           52,509     50,030
                                                    --------   --------
                                                    $583,432   $454,820
                                                    --------   --------
</TABLE>


<TABLE>
<CAPTION>
                                                     Percent    Percent
                                                    --------   --------
     Loans Types as a Percentage of Total  Loans
     -------------------------------------------

     <S>                                                <C>        <C>
     Commercial, financial and agricultural              13%        12%
     Real estate - construction ...........              16%        16%
     Real estate - mortgage ...............              62%        61%
     Consumer .............................               9%        11%
                                                    --------   --------
                                                        100%       100%
                                                    ========   ========
</TABLE>

DEPOSITS

The  Bank  offers a full  range of  interest-bearing  and  non-interest  bearing
deposit amounts,  including commercial and retail checking accounts,  negotiable
order of withdrawal ("NOW") accounts, super NOW accounts, public funds accounts,
money market accounts with limited  transactions  and a variable  interest rate,
individual retirement accounts,  regular  interest-bearing  savings account, and
certificates  of deposit with fixed and  variable  rates and a range of maturity
date options. The sources of deposits are residents,  business, and employees of
business  within  the  Bank's  market  area,   obtained   through  the  personal
solicitation of the Bank's officers and directors, direct mail solicitation, and
advertisements  published in the local media. The Bank pays competitive interest
rates  on time  and  savings  deposits  up to the  maximum  permitted  by law or
regulation.  In addition,  the Bank has implemented a competitive service charge
fee schedule,  covering such matters as maintenance  fees on checking  accounts,
per item  processing fees on checking  accounts,  returned check charges and the
like.

<PAGE>
                                       25


The following table presents,  for the periods indicated,  the average amount of
and average rate paid on each of the following deposit categories:

<TABLE>
<CAPTION>

     Year Ended December 31, 1997
     -----------------------------
                                             Average       Average
                                             Amount       Rate Paid
                                          ------------   -----------
     Deposit Category
     <S>                                  <C>              <C>
     Non-interest bearing deposits        $ 7,645,612      n/a
     NOW  deposits ...............          9,923,986      3.83%
     Money market deposits .......          2,142,774      3.80%
     Savings deposits ............          6,841,337      3.50%
     Time deposits ...............         26,308,611      5.64%


     Year Ended December 31, 1996
     -----------------------------
                                             Average       Average
                                             Amount       Rate Paid
                                          ------------   -----------

     Deposit Category
     Non-interest bearing deposits        $ 7,839,227      n/a
     Now  deposits ...............          9,291,178      3.74%
     Money market deposits .......          1,690,102      3.80%
     Savings deposits ............          6,945,750      3.50%
     Time deposits ...............         21,465,200      5.75%
</TABLE>

     The following is a summary of the remaining maturities of time certificates
     of deposit of $100,000 or more outstanding at December 31, 1997:

<TABLE>
<CAPTION>
                                           Certificates
                                            of Deposit
                                           ------------
     <S>                                    <C>
     Three months or less ...............   $ 1,145,909
     Over three months through six months     4,088,580
     Over six months through one year ...     3,953,480
     Over one year ......................     1,274,858
                                           ------------
                                            $10,462,827
                                           ------------
</TABLE>

Return on Equity and Assets

Returns on average  consolidated assets and average  consolidated equity for the
periods indicated are as follows:

<TABLE>
<CAPTION>
                                                 Years Ended December 31,
                                                 ------------------------
                                                      1997     1996
                                                    -------  --------
     <S>                                             <C>      <C>
     Return on average assets .............           1.88%    1.87%
     Return on average equity .............          16.56%   15.78%
     Average equity to average assets ratio          11.37%   11.84%
     Dividend payout ratio ................             -        -
</TABLE>
<PAGE>
                                       26


Item 7.  Financial Statements and Supplementary Data.
-----------------------------------------------------

The  response  to this Item is  submitted  in a separate  section of this report
commencing on page 33 .


Item 8.  Changes and Disagreements with Accountants on Accounting
-----------------------------------------------------------------
         and Financial Disclosures.
         --------------------------

There are no changes in or  disagreements  with  accountants  on accounting  and
financial disclosures.

                                    PART III

Item 9.  Directors and Executive Officers of the Registrant.
------------------------------------------------------------

The Company's directors and executive officers are as follows:

<TABLE>
<CAPTION>
         Name                               Position with Company

         <S>                                <C>
         E. James Burnsed *                 Class I Director,
                                                 President and
                                                 Chief Executive Officer

         J. Carl Cox, Jr.                   Class I Director

         L. Carlton Gill                    Class I Director,

         John R. Harvey                     Class II Director

         Thomas A. Lancaster                Class II Director

         G. Michael Odom, Jr. *             Executive Vice President and
                                                 Chief Operating Officer

         Juanita B. Phillips                Class II Director,

         James T. Roberts, Sr.              Class II Director

         James W. Royal                     Class III Director,
                                                 Secretary

         Jimmy F. Sommers                   Class III Director

         Charles L. Stafford                Class III Director,
                                                 Chairman of the Board

         Robert T. Thompson, Jr.            Class III Director

<FN>
* Mssrs. Burnsed and Odom are the only executive officers of the Company.
</FN>
</TABLE>

Each of the directors, except Director Harvey,  have  been  a  director  of  the
Company since  March 1989.  Director Harvey was elected a director in 1997.  The
Company's  Board  of  Directors  is  divided into three classes,  with one class
being elected each year at the Company's  Annual Meeting of  Shareholders.  Upon
such election, each director will serve for a term of three years. The Company's
officers are  appointed by the Board of Directors and hold office at the will of
the Board.
<PAGE>
                                       27


E. James Burnsed, age 58, has served as President and Chief Executive Officer of
the Company  since  March 1989 and of the Bank since  April  1989.  From 1958 to
1989, Mr. Burnsed served in various capacities with First Union Bank of Savannah
(formerly  Savannah Bank and Trust Company),  including most recently,  Regional
Consumer Banking Manager.

J. Carl Cox,  Jr.,  age 55, has been the owner,  manager  and  operator of J. C.
Logging, which is engaged in the logging business, for the past 25 years.

L. Carlton Gill, age 57, has been employed by S. A. Allen, Inc. as a procurement
forester since 1964.

John R.  Harvey,  age 62, is a Superior  Court  Judge in the  Atlantic  Judicial
Circuit of Georgia,  which includes Bryan County.  He has been a director of the
Bank for the past five years and a director of the Company for one year.

Thomas A.  Lancaster,  age 65, has served as a Vice  President  - Manager of the
Roofing Department and a Director of Metal Crafts, Inc., Savannah, Georgia since
1969.

G. Michael Odom, Jr., age 35, has served  as  Executive  Vice  President of  the
Company since March, 1996 and as Chief Operating Officer since  March, 1997. Mr.
Odom served  in  various  capacities with SunTrust Bank Southeast Georgia, N.A.,
Brunswick,  GA ,  including  most  recently,  Group Vice President of Commercial
Banking.

Juanita  B.  Phillips,  age 69,  has  been  employed  by The New  England  as an
insurance agent since 1976.

James T. Roberts, Sr., age 53, has been the owner-manager of Roberts GMC Trucks,
Richmond Hill, Georgia since 1969.

James W. Royal, age 49, has served as Secretary of the Company since March 1994.
In addition,  he has been  President  of Royal  Brothers,  Inc.,  engaged in the
retail hardware  business in the Richmond Hill area under the name of Royal True
Value and Village True Value Hardware Stores, since 1980.

Jimmy F. Sommers, age 53, has been Vice President of the Sommers Company,  Inc.,
a convenience store and petroleum distribution business, since 1972.

Charles L. Stafford,  age 55, has served as Chairman of the Board of the Company
since March 1989.  In addition,  he is engaged in the land  development/property
management  business  through a number of  companies  that he owns or  controls.
Since  1975,  Mr.  Stafford  has  been  President  of C.  L.  Stafford  Building
Contractors, Inc.

Robert T.  Thompson,  Jr.,  age 57, has been  employed  by CSX  Incorporated,  a
railroad  company,  since 1962.  In addition from 1989 to 1990, he served as the
owner of The Hub, a men's clothing store and from 1985 to 1989, he served as the
general manager for Superior Sanitation Service, Inc.

The directors do not hold any other directorships in reporting companies.

There are no family relationships  between any director or executive officer and
any other director or executive officer of the Company.

No director or executive  officer was involved in any bankruptcy  petition filed
by or against any business  with which the  director or executive  was a general
partner or executive  officer at the time of the  bankruptcy or within two years
prior to that time.

No director or executive  officer was involved in any  conviction  in a criminal
proceeding  or  subject  to a pending  criminal  proceeding  (excluding  traffic
violations or other minor offenses).

No director or executive  officer was subject to any order,  judgment or decree,
not  subsequently  reversed,  suspended  or vacated,  of any court of  competent
jurisdiction  permanently  or  temporarily  enjoining,  barring,  suspending  or
otherwise limiting his or her involvement in any type of business, securities or
banking activities.

No director or executive officer was found by a court of competent jurisdiction,
the SEC or the Commodity  Futures Trading  Commission to have violated a federal
or state securities or commodities law.
<PAGE>
                                       28

Item 10. Executive Compensation.
--------------------------------

The following table provides certain summary information concerning compensation
paid or  accrued  by the Bank to or on  behalf  of the  Bank's  Chief  Executive
Officer  for the years  ended  December  31,  1997,  1996,  and  1995.  No other
executive officer's compensation exceeded $100,000 during 1997, 1996 or 1995.

<TABLE>
<CAPTION>
===========================================================================================================
         Name and                       Annual                                      Long-Term
    Principal Position             Compensation Table                              Compensation

                                                              Other
                                                             Annual            Stock          Other
                           Year    Salary      Bonus       Compensation       Options      Compensation
===========================================================================================================
<S>                        <C>    <C>         <C>            <C>                             <C>
E. James Burnsed
President and Chief
Executive Officer
                           1997   $90,000     $36,480(1)     $62,000(2)                      $10,900(3)
                           1996   $90,000     $32,700                                        $ 5,821(3)
                           1995   $90,000     $41,200                                        $ 6,673(3)

<FN>
(1)      Includes regular bonus of $35,280 and Christmas bonus of $1,200.

(2)      Represents  the  value  of amounts earned on exercise of options during
         the  fiscal  year,  calculated  by  taking  the  difference between the
         fair market  value of the 4,000 shares  received on the  exercise  date
         ($25.00/share) and the exercise price ($9.50/share).

(3)      Represents   the  amount   earned  but  not  paid  from  the  Company's
         profit-sharing plan.
</FN>
</TABLE>

<TABLE>
<CAPTION>
====================================================================================================================
     Aggregated Option
 Exercises in Last Fiscal
  Year and FY-End Option
          values
====================================================================================================================
Name                        Shares acquired   Value         Number of securities          Value of unexercised
                            on                realized      underlying unexercised        in-the-money options at
                            exercise (#)      ($)           option at FY-end (#)          FY-end ($) Exercisable/
                                                            exercisable/unexercisable     Unexercisable

====================================================================================================================
<S>                         <C>               <C>           <C>                           <C>
E. James Burnsed,           4,000             $62,000       16,000/0                      $663,520(4)/0
President and Chief
Executive Officer
====================================================================================================================
<FN>
(4)      Calculated  as  the  difference  between  an  average  strike  price of
         $10.79  per share and per share fair market  value on March 10, 1998 of
         $52.26.  Fair market  value of $52.26 per share  represents  1.85 times
         the  most  recently  reported  trade  of the  common  stock of Savannah
         Bancorp,  Inc., which has pursuant to an Agreement  of Merger  with the
         Company  (as  described  below)  agreed  to  issue  1.85  shares of its
         common stock in exchange for each share of common stock of the Company.
</FN>
</TABLE>
<PAGE>
                                       29


Item 11.  Security Ownership of Certain Beneficial Owners and Management.
-------------------------------------------------------------------------

The following table sets forth certain information as of December 31, 1997, with
respect to ownership of the  outstanding  common stock of the Company by (i) all
persons known to the Company to own beneficially more than 5% of the outstanding
shares of the common  stock of the Company,  (ii) each  director of the Company,
and (iii) all executive officers and directors of the Company as a group.
<TABLE>
<CAPTION>

=============================================================================
 NAME AND ADDRESS                 AMOUNT AND NATURE OF
OF BENEFICIAL OWNER               BENEFICIAL OWNER (1)      PERCENT OF CLASS
=============================================================================
<S>                                    <C>                       <C>
E. James Burnsed
173 Davis Road                         33,599 (2)                6.47%(13)
Richmond Hill, GA 31324
=============================================================================
J. Carl Cox, Jr.
7346 Highway 17                        20,015 (3)                3.98%
Richmond Hill, GA 31324
=============================================================================
L. Carlton Gill
P. O. Box 59                           35,735 (4)                7.10%
Richmond Hill, GA 31324
=============================================================================
John R. Harvey
P. O. Box 1018                         2,200 (12)                0.44%
Pembroke, GA 31321
=============================================================================
Thomas A. Lancaster
P. O. Box 1448                         15,602 (5)                3.10%
Richmond Hill, GA 31324
=============================================================================
G. Michael Odom, Jr.
292 Mingarry Drive                     2,000 (14)                0.40%
Richmond Hill, GA 31324
=============================================================================
Juanita B. Phillips
197 Ogeechee Drive                     14,717 (6)                2.93%
Richmond Hill, GA 31324
=============================================================================
James T. Roberts
415 Whitehall Lane                     26,062 (7)                5.16%
Richmond Hill, GA 31324
=============================================================================
James W. Royal
P. O. Box 1096                         21,263 (8)                4.23%
Richmond Hill, GA 31324
=============================================================================
Jimmy F. Sommers
P. O. Box 556                          29,635 (9)                5.89%
Richmond Hill, GA 31324
=============================================================================
Charles L. Stafford
P. O. Box 460                          46,196 (10)               9.18%
Richmond Hill, GA 31324

=============================================================================
Robert T. Thompson, Jr.
2369 Fort McAllister Rd.               21,395 (11)               4.25%
Richmond Hill, GA 31324
=============================================================================
<FN>
(1)      Information relating to beneficial ownership by  all executive officers
         and  directors  is  based  upon information furnished by each executive
         officer  and  director  using "beneficial ownership" concepts set forth
         in  rules  promulgated  by the Securities and Exchange Commission under
         Section 13(d) of the Securities Exchange Act of 1934.
<PAGE>
                                       30


(2)      Includes 16,000 shares subject to presently  exercisable  stock options
         granted in connection with Mr. Burnsed's Employment  Agreement.  Of the
         remaining shares  beneficially owned by Mr. Burnsed,  11,256 shares are
         owned  individually,  5,653 shares are in his IRA, 200 shares are owned
         by his wife individually, and 490 shares are in his wife's IRA.

(3)      Of the 20,015 shares  beneficially  owned by Mr. Cox, 19,815 shares are
         owned individually and 200 shares are owned by his wife.

(4)      Of the 35,735 shares  beneficially owned by Mr. Gill, 22,265 shares are
         owned jointly with his wife,  1,070 shares are in his IRA, 1,200 shares
         are in his wife's  IRA,  and  10,600  shares are owned by the Estate of
         Louis C. Gill,of which he is the Executor,  and 600 shares are owned by
         his children.

(5)      Of the 15,602 shares beneficially owned by Mr. Lancaster, 11,202 shares
         are owned individually,  3,300 shares are in his IRA, 700 shares are in
         his wife's IRA, and 400 shares are owned by his children.

(6)      Of the 14,717 shares beneficially owned by Mrs. Phillips,  6,277 shares
         are in her IRA and 8,440 are owned by her children.

(7)      Of the 26,062 shares  beneficially owned by Mr. Roberts,  20,487 shares
         are owned  individually,  2,975  shares are in his IRA,  600 shares are
         owned by his wife, and 2,000 shares are owned by his children.

(8)      Of the 21,263 shares beneficially owned by Mr. Royal, 19,263 shares are
         owned  individually,  1,800  shares are in his IRA,  and 200 shares are
         owned jointly with his children.

(9)      Of the 29,635 shares  beneficially owned by Mr. Sommers,  28,995 shares
         are  owned  individually  and 640  shares  are owned  jointly  with his
         children.

(10)     Of the 46,196 shares beneficially owned by Mr. Stafford,  17,700 shares
         are owned  individually,  2,673 shares are in his IRA, 1,550 shares are
         owned by his wife,  1,689  shares are in his wife's IRA, 250 shares are
         owned by his son, and 22,334 shares are owned by C. L. Stafford  Profit
         Sharing Plan.

(11)     Of the 21,395 shares beneficially owned by Mr. Thompson,  18,009 shares
         are owned  individually,  1,079 shares are in his IRA, 1,807 shares are
         in his wife's IRA and 500 shares are owned by his children.

(12)     Of the 2,200 shares owned by Mr. Harvey, all are jointly owned with his
         wife.

(13)     Mr. Burnsed's  percent of class is calculated on the assumption that he
         has  exercised  the  16,000  options  owned by him,  and that the total
         number  of  issued  and  outstanding  shares  of the  Company  has been
         correspondingly increased.

(14)     All of  the shares  listed for  Mr. Odom  are stock  options  that  are
         exercisable by him in the next 60 days.
</FN>
</TABLE>

The  Company's  common stock  beneficially  owned by all directors and executive
officers  as a group as of March 6, 1998 (12  persons)  totaled  268,419  shares
representing  51.14% of the  Company's  common  stock.  This  total  figure  and
percentage  are  calculated on the  assumption  that all persons  listed who own
stock options  exercisable  within the next 60 days will in fact do so, and that
the number of issued and outstanding shares of the Company has been increased by
a corresponding amount.

On February 11, 1998, the Company and The Savannah  Bancorp,  Inc.  ("Savannah")
jointly announced that they had entered into a definitive  agreement and plan of
merger  ("Agreement  of  Merger") of the Company  into  Savannah.  Savannah is a
one-bank holding company.  Its wholly owned subsidiary,  The Savannah Bank, N.A.
operates four offices in the  Savannah,  Georgia  area.  The proposed  merger is
subject to any required corporate shareholder and regulatory approvals.
<PAGE>
                                       31


Pursuant to Section 5.23 of the Agreement of Merger, the Company represented and
warranted to Savannah,  as an  inducement  to entering the  Agreement of Merger,
that each of the Company's  directors (except Charles Stafford) had executed and
delivered  to  Savannah a  "Director's  Agreement"  in the form  attached to the
Agreement of Merger as Exhibit 3. Each director of the Company  (except  Charles
Stafford)  did deliver a "Director's  Agreement" to Savannah in accordance  with
that  warranty  and  representation.  Pursuant  to  Section 2 of the  Director's
Agreement,  each of the Company's  directors (except Charles Stafford) agreed to
(1) vote all shares of common stock of the Company  beneficially owned by him or
her (and as to which he or she  possessed  sole  voting  power)  in favor of the
merger of the Company into  Savannah,  (2)  recommend  approval of the merger to
shareholders  of the  Company,  and (3) use his or her best  efforts  to  effect
consummation of the merger. In addition,  each of the Company's directors agreed
not to sell or otherwise  dispose of his or her shares of the  Company's  common
stock.  The total  number of shares  beneficially  owned  (and as to which  each
director  possesses  sole  voting  power)  by  all  directors   delivering  such
Director's Agreements is 195,083, representing 38.78% of the common stock of the
Company.(1) The total number of shares  beneficially  owned (whether or not each
director  has sole  power  to vote  such  shares)  by all  directors  delivering
Directors Agreements is 220,223,  representing 42.43% of the common stock of the
Company.(2)  This figure differs from that given for all directors and executive
officers as a group,  stated above as 266,419  shares  (51.33%) of the Company's
common stock because, as noted, Mr. Charles Stafford (beneficial owner of 46,196
shares) did not deliver a director's agreement.

Savannah agreed,  in Section 5.23 of the Agreement of Merger,  that if it failed
to reelect any of the Company's  Directors  to  the  Bank's  Board during the 24
months following the closing, it would immediately pay such director the fees he
or  she  would   have  earned as a  director  of the  Bank's  Board  during  the
remainder of the 24 month period.

On February 26 and 27, 1998, the Company filed, respectively,  a Form 8-K and an
amendment thereto, Form 8-K/A, disclosing the foregoing information and included
as exhibits the Agreement of Merger and form of Director's  Agreement  described
hereinabove.


Item 12.  Certain Relationships and Related Transactions.
---------------------------------------------------------

The Company's directors,  executive officers, and certain business organizations
and  individuals  associated  therewith,  have  been  customers  of and have had
banking  transactions  with Bryan Bank & Trust and are expected to continue such
relationships  in the  future.  Pursuant  to such  transactions,  the  Company's
directors  and executive  officers  from time to time have  borrowed  funds from
Bryan Bank & Trust for various business and personal  reasons.  These loans were
made in the ordinary  course of business,  were made on  substantially  the same
terms, including interest rates and collateral,  as those prevailing at the time
for comparable  transactions with persons not affiliated with the Company or the
Bank and did not involved more than the normal risk of collectibility or present
other unfavorable features.


--------
1 Calculated on the assumption that no options would be exercised.  If, however,
  it is assumed that all directors  delivering  Director's  Agreements  exercise
  options  held by them,  then the  total  number of  shares  (as to which  each
  director would possess sole voting power) will be 211,083, representing 40.67%
  of the then issued and outstanding common stock of the Company.

2 Calculated on the assumption that all options would be exercised.


<PAGE>
                                       32


Item 13.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K
--------------------------------------------------------------------------

(a)1.    Financial Statements.
         ---------------------

                 The following financial statements and accountant's report have
                 been filed as item 7 in Part II of this report:

                 Independent Auditor's Report
                 Consolidated   Balance   Sheets-December   31,  1997  and  1996
                 Consolidated Statements of Income-Years ended December 31, 1997
                 and 1996 Consolidated Statements of Shareholders'  Equity-Years
                 ended  December 31, 1997 and 1996  Consolidated  Statements  of
                 Cash  Flows-Years  ended  December  31,  1997 and 1996 Notes to
                 Consolidated Financial Statements

   2.            Financial Statement Schedules.

                 Financial  statement  schedules  are  omitted  as the  required
                 information is inapplicable, or the information is presented in
                 the financial statements or related notes.

   3.            Exhibits.
                 ---------

                 The  following  exhibits  are  filed  with or  incorporated  by
                 reference into this report.  The exhibits which are denominated
                 by an asterisk (*) were previously  filed as a part of, and are
                 hereby incorporated by reference from either (i) a Registration
                 Statement on Form S-18 under the Securities Act of 1933 for the
                 Registrant  ,  Registration  No.  33-28514-A   ("S-18"),   (ii)
                 Amendment No. 1 to the Company's Registration Statement on Form
                 S-18 ("S-18  Amendment"),  (iii) The Annual Report on Form 10-K
                 for the year ended December 31, 1990 ("1990 10-K"),(iv) Current
                 Report on Form 8-K, filed February 27, 1998 with the Commission
                 ("8-K"),  or (v) Current  Report on Form 8-K/A,  filed March 3,
                 1998  with  the  Commission   ("8-K/A").   The  exhibit  number
                 corresponds to the exhibit number in the referenced document.

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

                 *2                        Agreement of Merger between The
                                           Savannah  Bancorp  , Inc.   and
                                           Registrant (8-K and 8-K/A).

                 *3.1                      Articles of Incorporation dated
                                           March 6, 1989 (S-18).

                 *3.2                      By-Laws adopted March 6, 1989 (S-18).

                 *22.1                     Subsidiaries of the Registrant
                                           (1990 10-K).

(b)              Reports on Form 8-K.
                 --------------------

                 No reports on Form 8-K were required to be filed for the fourth
                 quarter of 1997.


<PAGE>
                                       33



                          INDEPENDENT AUDITOR'S REPORT


The Board of Directors and Shareholders
Bryan Bancorp of Georgia, Inc.
Richmond Hill, Georgia


We have audited the accompanying consolidated balance sheets of Bryan Bancorp of
Georgia,  Inc. and  subsidiary as of December 31, 1997 and 1996, and the related
years then ended.  These  financial  statements  are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion the consolidated  financial  statements referred to above present
fairly,  in all material  respects,  the financial  position of Bryan Bancorp of
Georgia,  Inc. and  subsidiary  at December 31, 1997 and 1996 and the results of
their  operations  and their cash  flows for the years then ended in  conformity
with generally accepted accounting principles.





/s/Tiller, Stewart & Company, LLC
Savannah, Georgia
January  30, 1998

<PAGE>
                                       34

<TABLE>
<CAPTION>


                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                           December 31, 1997 and 1996

--------------------------------------------------------------------------------

                                                          1997            1996
                                                      ------------    ------------
<S>                                                   <C>             <C>
Cash and due from banks ...........................   $  2,039,246    $  2,296,408
Interest-bearing deposits with other banks ........        990,000
Federal funds sold ................................         38,000       5,530,000
Investment securities available for sale ..........      9,305,642       5,289,372
Investment securities held to maturity
 (estimated market value of $3,466,339
  in 1997 and $3,330,320 in 1996) .................      3,345,619       3,194,200
Loans .............................................     48,197,054      42,260,259
Less allowance for loan losses ....................       (583,432)       (454,820)
                                                      ------------    ------------
          Loans, net ..............................     47,613,622      41,805,439
Interest receivable ...............................        452,262         373,089
Premises and equipment, net .......................      1,493,663       1,456,993
Other assets ......................................        234,625         267,409
                                                      ------------    ------------
     Total assets .................................   $ 65,512,679    $ 60,212,910
                                                      ============    ============

LIABILITIES
Deposits:
  Noninterest-bearing .............................   $  7,685,324    $  9,624,367
  Interest-bearing ................................     48,294,761      42,979,709
                                                      ------------    ------------
     Total deposits ...............................     55,980,085      52,604,076
Federal Home Loan Bank advances ...................      1,590,000         380,000
Other borrowed funds ..............................        130,000          53,195
Interest payable ..................................        210,290         227,940
Other liabilities .................................        181,425         177,195
                                                      ------------    ------------
     Total liabilities ............................     58,091,800      53,442,406
                                                      ------------    ------------

SHAREHOLDERS' EQUITY
Common stock - par value $1 per share;
    authorized 10,000,000 shares;
    issued 528,258 shares in 1997 .................        528,258         521,758
    and 521,758 shares in 1996
Additional paid-in capital ........................      4,963,745       4,869,485
Retained earnings .................................      2,444,135       1,715,073
Net unrealized (loss) on investment securities
   available for sale, net of deferred income taxes         (6,409)        (27,212)
                                                      ------------    ------------
                                                         7,929,729       7,079,104
Treasury stock at cost, 25,250 shares
      in 1997 and 17,200 shares in 1996 ...........       (508,850)       (308,600)
                                                      ------------    ------------
     Total shareholders' equity ...................      7,420,879       6,770,504
                                                      ------------    ------------
     Total liabilities and shareholders' equity ...   $ 65,512,679    $ 60,212,910
                                                      ============    ============
<FN>
See notes to consolidated financial statements
</FN>

</TABLE>
<PAGE>
                                       35


<TABLE>
<CAPTION>

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF INCOME
                     Years Ended December 31, 1997 and 1996

--------------------------------------------------------------------------------
                                             1997         1996
                                          ----------   ----------

INTEREST INCOME
<S>                                       <C>          <C>
Loans .................................   $4,781,290   $4,187,876
 Investment securities:
    Taxable ...........................      453,930      323,735
    Tax-exempt ........................      172,070      164,535
 Federal funds sold ...................      116,313      141,655
 Deposits in other banks ..............       11,407        9,581
                                          ----------   ----------
     Total interest income ............    5,535,010    4,827,382
                                          ----------   ----------

INTEREST EXPENSE
Deposits ..............................    2,186,191    1,888,093
Federal Home Loan Bank advances .......       68,317       22,718
Other borrowed funds ..................        4,698        4,700
                                          ----------   ----------
     Total interest expense ...........    2,259,206    1,915,511
                                          ----------   ----------

NET INTEREST INCOME ...................    3,275,804    2,911,871
PROVISION FOR LOAN LOSSES .............      180,000       90,000
                                          ----------   ----------
NET INTEREST INCOME AFTER
  PROVISION FOR LOAN LOSSES ...........    3,095,804    2,821,871
                                          ----------   ----------

NONINTEREST INCOME
Service charges on deposit accounts ...      345,294      368,628
Mortgage origination fees .............      123,170       10,896
Other service charges and fees ........      102,418       81,271
Net realized gain on sales of available
    for sale securities ...............        2,061
Other .................................      146,903       87,390
                                          ----------   ----------
                                             719,846      548,185
                                          ----------   ----------
NONINTEREST EXPENSES
Salaries and employee benefits ........    1,213,257    1,002,542
Occupancy .............................       96,489       99,701
Equipment and data processing .........      216,881      224,853
Other .................................      551,257      513,637
                                          ----------   ----------
                                           2,077,884    1,840,733
                                          ----------   ----------

INCOME BEFORE INCOME TAXES ............    1,737,766    1,529,323
PROVISION FOR INCOME TAXES ............      580,000      508,000
                                          ----------   ----------
NET INCOME ............................   $1,157,766   $1,021,323
                                          ==========   ==========

Basic earnings per share                  $     2.30   $     2.01
                                          ==========   ==========
Diluted earnings per share                $     2.25   $     1.98
                                          ==========   ==========
<FN>
See notes to consolidated financial statements
</FN>
</TABLE>
<PAGE>
                                       36

<TABLE>
<CAPTION>

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                     Years Ended December 31, 1997 and 1996

--------------------------------------------------------------------------------

                                                                                                   Net
                                                                                                Unrealized
                                                                                                Gain (Loss)
                                                                                               on Investment
                                                                    Additional                  Securities
                                                 Common Stock        Paid-In      Retained      Available    Treasury
                                               Shares     Amount     Capital      Earnings      for Sale      Stock         Total
                                               -------  ---------  -----------  -----------  -------------  ----------  -----------
<S>                                            <C>      <C>        <C>          <C>          <C>            <C>         <C>
BALANCE - DECEMBER 31, 1995                    521,758  $ 521,758  $ 4,869,485  $ 1,048,341  $     (7,777)  $ (57,800)  $ 6,374,007

  Net income                                                                      1,021,323                               1,021,323

  Dividends paid - $.70 per share                                                  (354,591)                               (354,591)

  Purchase of 12,600 shares of treasury stock                                                                (250,800)     (250,800)

  Net change in unrealized gain (loss) on
    investment securities available for sale                                                      (19,435)                  (19,435)
                                               -------  ---------  -----------  -----------  -------------  ----------  -----------
BALANCE - DECEMBER 31, 1996                    521,758    521,758   4,869,485     1,715,073       (27,212)   (308,600)    6,770,504

  Net income                                                                      1,157,766                               1,195,766

  Dividends paid - $.85 per share                                                  (428,704)                               (428,704)

  Purchase of 8,050 shares of treasury stock                                                                 (200,250)     (200,250)

  Exercise of stock options                      6,500      6,500       56,260                                               62,760

  Tax Benefit from exercise of stock options                            38,000                                               38,000

  Net change in unrealized gain (loss) on
    investment securities available for sale                                                        20,803                   20,803
                                               -------  ---------  -----------  -----------  -------------   ---------- -----------
BALANCE - DECEMBER 31, 1997                    528,258  $ 528,258  $ 4,963,745  $ 2,444,135  $      (6,409)  $(508,850) $ 7,420,879
                                               =======  =========  ===========  ===========  =============   ========== ===========


<FN>
See notes to consolidated financial statements
</FN>
</TABLE>

<PAGE>
                                       37

<TABLE>
<CAPTION>

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                     Years Ended December 31, 1997 and 1996

--------------------------------------------------------------------------------

                                                                1997          1996
                                                            -----------    -----------

OPERATING ACTIVITIES
<S>                                                         <C>            <C>
  Net income ............................................   $ 1,157,766    $ 1,021,323
  Adjustments to reconcile net income
    to net cash provided by operating activities:
       Depreciation .....................................       123,301        107,856
       Amortization and accretion, net ..................         3,740            534
       Provision for loan losses ........................       180,000         90,000
       Net realized gain on available for sale securities        (2,061)
       Amortization of deferred loan fees ...............       (10,556)        14,043
       Changes in:
          Interest receivable ...........................       (79,173)        (5,847)
          Other assets ..................................        18,915         (8,299)
          Interest payable ..............................       (17,650)         7,153
          Other liabilities .............................        42,230       (178,104)
                                                            -----------    -----------
              Net cash provided by operating activities .     1,416,512      1,048,659
                                                            -----------    -----------

INVESTING ACTIVITIES
  Net increase in time deposits in other banks ..........      (990,000)
  Net (increase) decrease in federal funds sold .........     5,492,000     (3,059,000)
  Proceeds from maturities of investment securities:
    Held to maturity securities .........................        75,000         50,000
    Available for sale securities .......................     2,504,205        881,310
  Proceeds from sales of available for sale securities ..     1,207,405
  Purchase of investment securities:
    Held to maturity securities .........................      (223,500)      (181,900)
    Available for sale securities .......................    (7,697,806)      (500,000)
  Net increase in loans .................................    (5,977,627)    (5,458,342)
  Additions to premises and equipment ...................      (159,971)      (476,072)
                                                            -----------    -----------
              Net cash used for investing activities ....    (5,770,294)    (8,744,004)
                                                            -----------    -----------

FINANCING ACTIVITIES
  Net increase in deposits ..............................     3,376,009      9,107,028
  Proceeds from Federal Home Loan Bank advances .........     2,750,000        400,000
  Repayment of Federal Home Loan Bank advances ..........    (1,540,000)    (1,320,000)
  Net  increase in other borrowings .....................        76,805          3,221
  Dividends paid ........................................      (428,704)      (354,591)
  Purchase of Treasury Stock.............................      (200,250)      (250,800)
  Exercise of Stock Options..............................        62,760
                                                            -----------    -----------
              Net cash provided by financing activities .     4,096,620      7,584,858
                                                            -----------    -----------

Decrease in cash and cash equivalents ...................      (257,162)      (110,487)

Cash and cash equivalents - beginning ...................     2,296,408      2,406,895
                                                            -----------    -----------

Cash and cash equivalents - ending ......................   $ 2,039,246    $ 2,296,408
                                                            ===========    ===========

<FN>
See notes to consolidated financial statements
</FN>
</TABLE>
<PAGE>
                                       38


                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================




1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    Nature of  Operations  - Bryan  Bancorp of  Georgia,  Inc.  (the  "Company")
    through  its  wholly-owned  subsidiary,  Bryan  Bank & Trust  (the  "Bank"),
    provides  a full range of  banking  services  to  individuals  and  business
    throughout Bryan and surrounding counties.

    Basis of Presentation - The consolidated  financial  statements  include the
    accounts of the Company and its  wholly-owned  subsidiary.  All intercompany
    balances and transactions have been eliminated. The accounting and reporting
    policies  and  practices  of  the  Company  conform  to  generally  accepted
    accounting  principles and to general practice within the banking  industry.
    The  following  is a summary of the more  significant  of such  policies and
    practices.

    Use of Estimates - The  preparation  of financial  statements  in conformity
    with generally accepted  accounting  principles  requires management to make
    estimates  and  assumptions  that affect the reported  amounts of assets and
    liabilities and disclosure of contingent  assets and liabilities at the date
    of the  financial  statements  and the  reported  amounts  of  revenues  and
    expenses during the reporting period. Actual results could differ from those
    estimates.

    Material  estimates that are particularly  susceptible to significant change
    relate to the determination of the allowance for loan losses.  The allowance
    for loan losses is maintained at a level which, in management's judgment, is
    adequate  to  absorb   credit  losses   inherent  in  the  loan   portfolio.
    Management's  periodic  evaluation of the adequacy of the allowance is based
    on the  Bank's  past  loss  experience,  known  and  inherent  risks  in the
    portfolio, adverse situations that may affect the borrower's ability to pay,
    the  estimated  value  of  the  underlying   collateral,   current  economic
    conditions,  and other pertinent  factors.  The allowance for loan losses is
    increased by charges to income and  recoveries on loans  previously  charged
    off as  uncollectible.  Decreases  in the  allowance  occur as loans  deemed
    uncollectible are charged to the allowance.

    Investment  Securities  Available for Sale - Investments  available for sale
    are carried at market value.  The related  unrealized  gain or loss,  net of
    tax, is included as a separate component of shareholders'  equity.  Premiums
    and discounts are amortized and accreted using a method which approximates a
    level  yield.  Gains  and  losses  from  dispositions  are  based on the net
    proceeds and adjusted  carrying  amounts of the securities  sold,  using the
    specific identification method.

    Investment  Securities  Held to  Maturity -  Investment  securities  held to
    maturity  are stated at cost,  adjusted  for  amortization  of premiums  and
    accretion of  discounts  which are  recognized  as  adjustments  to interest
    income.  The  Company  has the intent and  ability to hold these  investment
    securities  to maturity.  Premiums and  discounts are amortized and accreted
    using a method  which  approximates  a level  yield.  Gains  and  losses  on
    dispositions are based on the net proceeds and the adjusted carrying amounts
    of the security sold, using the specific identification method.

    Loans - Effective  January 1, 1995, the Bank adopted  Statement of Financial
    Accounting  Standards  No.  114 (as  amended  by No.  118),  "Accounting  by
    Creditors for Impairment of a Loan." SFAS 114  establishes the accounting by
    creditors for  impairment of loans by specifying  how  allowances for credit
    losses  related to certain loans should be  determined.  This statement also
    addresses   the   accounting   by  creditors  for  certain  loans  that  are
    restructured in a troubled debt restructuring.  When a loan is impaired, the
    amount of the  impairment is measured based on the present value of expected
    future cash flows discounted at the loan's effective interest rate.
<PAGE>
                                       39

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================

    For  collateral  dependent  loans,  impairment is measured based on a loan's
    observable market price or the fair value of the collateral.

    Loans that management has the intent and ability to hold for the foreseeable
    future or until  maturity  or  pay-off  are  reported  at their  outstanding
    principal  amounts adjusted for any charge-offs,  the allowance for possible
    loan losses, and any deferred fees or costs.

    Interest on loans is recognized  using the simple  interest  method based on
    the principal balance outstanding.  Interest accruals, including accruals of
    interest on impaired  loans,  are  discontinued  when  either  principal  or
    interest  becomes 90 days past due, or when in management's  opinion,  after
    considering  economic and business  conditions and collection  efforts,  the
    borrower's  financial  condition is such that it is not reasonable to expect
    such interest will be collected.  Interest income is subsequently recognized
    only to the extent cash payments are received.

    Loan fees, net of direct  origination costs, are deferred and amortized over
    the terms of the loans using a method which approximates a level yield.

    Premises  and  Equipment  -  Property  is stated  at cost  less  accumulated
    depreciation.  Depreciation is computed using the straight-line  method over
    the estimated useful lives of such assets.

    Income Taxes - Provisions  for income taxes are based upon amounts  reported
    in the statements of income (after  exclusion of non-taxable  income such as
    interest on state and municipal securities) and include deferred taxes based
    on the differences  between financial  statement and tax bases of assets and
    liabilities using current enacted tax rates. As changes in tax laws or rates
    are enacted,  deferred tax assets and liabilities  are adjusted  through the
    provision for income taxes.

    Net  Income  Per  Share - Net  income  per  share is  computed  based on the
    weighted average number of common and common equivalent  shares  outstanding
    during the year.

    Reclassifications  -  Certain  amounts  in the 1996  consolidated  financial
    statements have been reclassified to conform to the 1997 presentation.

    Cash and Cash  Equivalents - For purposes of reporting cash flows,  cash and
    cash equivalents include cash on hand and amounts due from banks.

    Recent  Accounting  Pronouncements - In June 1997, the Financial  Accounting
    Standards Board (FASB) issued Statements of Financial  Accounting  Standards
    (SFAS) No. 130 "Reporting  Comprehensive  Income" This statement established
    standards  for  reporting  and  displaying   comprehensive  income  and  its
    components in a full set of general-purpose  financial  statements.  This is
    effective for fiscal years  beginning  after  December 15, 1997. The Company
    does not expect any  material  changes to its  current  reporting  format in
    response to this statement.

    Also, in June 1997, the Financial Accounting Standards Board issued SFAS No.
    131 "Disclosure about Segments of an Enterprise and Related information" and
    is  effective  for fiscal years  beginning  after  December  15, 1997.  This
    statement  establishes  standards for reporting operating segments by public
    business  enterprises in annual financial statements and requires that those
    enterprises report selected  information about operating segments in interim
    financial reports to shareholders.  The adoption of this statement will have
    no effect on the financial statements of the Company.
<PAGE>
                                       40

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================


2.  RESTRICTIONS ON CASH AND DUE FROM BANKS

    The Bank is  required to maintain  certain  reserve  balances in the form of
    vault cash. Such reserve  requirements  totaled  approximately  $371,000 and
    $338,000 at December 31, 1997 and 1996, respectively.

3.  SECURITIES

    Debt and equity  securities have been  classified  according to management's
    intent.  The amortized  cost,  estimated  market value and gross  unrealized
    gains and losses on securities are as follows:


<TABLE>
<CAPTION>


                                              Available For Sale Securities
                                 -----------------------------------------------------------
                                                    Gross           Gross
                                  Amortized      Unrealized      Unrealized        Fair
                                     Costs          Gains           Losses         Value
                                 ------------   -------------   -------------   ------------
<S>                               <C>           <C>              <C>            <C>
December 31, 1997:
U.S. Treasury and
  U.S. Government agencies        $ 6,148,779   $      22,356    $      1,502   $  6,169,633
Mortgage-backed securities          3,167,546          15,946          47,483      3,136,009
                                 ------------   -------------   -------------   ------------
 Total                            $ 9,316,325   $      38,302    $     48,985   $  9,305,642
                                 ============   =============   =============   ============
December 31, 1996:
U.S. Treasury and
  U.S. Government agencies        $ 1,399,708   $          60    $      1,361   $  1,398,407
Mortgage-backed securities          3,928,861          20,054          64,106      3,884,809
                                 ------------   -------------   -------------   ------------
Total debt securities               5,328,569          20,114          65,467      5,283,216
Equity securities                       6,156                                          6,156
                                 ------------   -------------   -------------   ------------
Total                             $ 5,334,725   $      20,114   $      65,467   $  5,289,372
                                 ============   =============   =============   ============

                                                 Held To Maturity Securities
                                 -----------------------------------------------------------
                                                    Gross           Gross
                                  Amortized      Unrealized      Unrealized        Fair
                                     Costs          Gains           Losses         Value
                                 ------------   -------------   -------------   ------------
December 31, 1997:
State and political subdivisions  $ 3,165,919   $     120,720   $           -   $  3,286,639
Other securities                      179,700                                        179,700
                                 ------------   -------------   -------------   ------------
Total                             $ 3,345,619   $     120,720   $           -   $  3,466,339
                                 ============   =============   =============   ============
December 31, 1996:
State and political subdivisions  $ 3,038,000   $     136,335   $         215   $  3,174,120
Other securities                      156,200                                        156,200
                                 ------------   -------------   -------------   ------------
Total                             $ 3,194,200   $     136,335   $         215   $  3,330,320
                                 ============   =============   =============   ============
</TABLE>

    Other  securities  reported in held to maturity  securities  at December 31,
    1997 and 1996  represent an investment in Federal Home Loan Bank stock which
    is not traded on Exchanges and has only redemption capabilities.
<PAGE>
                                       41

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================

    Gross   realized   gains   and   gross   realized   losses   on   sales   of
    available-for-sale  securities were $2,735 and $674, respectively,  in 1997.
    There were no sales of investment securities during 1996.

    The amortized cost and estimated market value of debt securities at December
    31, 1997, by contractual maturity are as follows:
<TABLE>
<CAPTION>
                                  Available for sale         Held to maturity
                               ------------------------  ----------------------
                                Amortized     Market      Amortized    Market
                                  Cost        Value         Cost       Value
                               ----------   ----------   ----------  ----------
<S>                            <C>          <C>          <C>         <C>
Due in one year or less ....   $  200,000   $  198,498
Due after one year through
  five years ...............    4,949,699    4,969,570    1,117,362   1,138,614
Due after five years through
  ten years ................      999,080    1,001,565    1,549,961   1,620,720
Due after ten years ........                                498,596     527,305
Mortgage-backed securities .    3,167,546    3,136,009
                               ----------   ----------   ----------  ----------
                               $9,316,325   $9,305,642   $3,165,919  $3,286,639
                               ==========   ==========   ==========  ==========
</TABLE>

    Securities  with a carrying  amount of $4,135,612 at December 31, 1997,  and
    $4,701,114  at December 31, 1996 were  pledged to secure  deposits of public
    funds and for other purposes required or permitted by law.

4.  LOANS

    Loans are summarized as follows:
<TABLE>
<CAPTION>
                                                  December 31,
                                         -----------------------------
                                             1997           1996
                                         -------------   -------------
<S>                                      <C>             <C>
Commercial ...........................   $  6,627,303    $  4,798,046
Commercial real estate ...............     21,693,095      17,839,771
Real estate construction .............      7,561,049       6,971,033
Residential real estate ..............      8,179,407       8,123,898
Consumer .............................      4,203,117       4,604,984
                                         ------------    ------------
                                           48,263,971      42,337,732
Net deferred loan fees ...............        (66,917)        (77,473)
                                         ------------    ------------
                                         $ 48,197,054    $ 42,260,259
                                         ============    ============
</TABLE>

    An analysis of the allowance for loan losses is as follows:

<TABLE>
<CAPTION>
                                              1997            1996
                                         ------------    ------------
<S>                                         <C>             <C>
Balance, beginning of year ...........      $ 454,820       $ 427,662
  Provision for loan losses ..........        180,000          90,000
  Loans charged off ..................       (122,780)        (89,659)
  Recoveries .........................         71,392          26,817
                                         ------------    ------------
Balance, end of year .................      $ 583,432       $ 454,820
                                         ============    ============
</TABLE>
<PAGE>
                                       42

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================


    Loans having recorded investments of approximately  $304,000 at December 31,
    1997 and approximately  $56,000 at December 31, 1996 have been identified as
    impaired in accordance  with the  provisions  of FASB  Statement No. 114. as
    amended by FASB Statement No. 118. The average  recorded  investment in such
    loans  during  1997  and  1996  was  approximately   $311,000  and  $56,700,
    respectively.  The total allowance for possible loan losses related to these
    loans was $45,575 and $12,000 at December 31, 1997 and 1996, respectively.

    In the normal  course of its lending  activities,  the Company is a party to
    financial  instruments  with   off-balance-sheet   risk  .  These  financial
    instruments  include  commitments  to extend  credit and standby  letters of
    credit.   The   Company's   exposure   to  credit   loss  in  the  event  of
    non-performance  by  the  other  party  of  the  financial   instrument  for
    commitments to extend credit and standby letters of credit is represented by
    contractual  amount of those  instruments.  The Company uses the same credit
    policies  in  making  these  commitments  as it does  for  on-balance  sheet
    instruments   and  evaluates  each   customer's   credit   worthiness  on  a
    case-by-case  basis. At December 31, 1997, the Company had outstanding  loan
    commitments of  approximately  $6,498,000  and standby  letters of credit of
    approximately   $91,000.  The  amount  of  collateral  obtained,  if  deemed
    necessary,  for these commitments by the Company,  upon extension of credit,
    is based on management's credit evaluation of the customer. Collateral held,
    if any, varies but may include inventory,  equipment,  real estate, or other
    property.  The Bank's loans are primarily concentrated in its market area of
    Bryan and Chatham counties of Georgia.

5.  RELATED PARTY TRANSACTIONS

    In the ordinary  course of business,  the Bank has direct and indirect loans
    outstanding  to  certain  directors,   executive  officers,   and  principal
    shareholders,  including their  associates.  Such loans are made on the same
    terms as those  prevailing  at the time  for  comparable  transactions  with
    unaffiliated customers.

    The following is a summary of the activity of loans to directors,  executive
    officers, and principal shareholders:

<TABLE>
<CAPTION>
                                                December 31,
                                         -------------------------
                                             1997          1996
                                         ----------    -----------
<S>                                      <C>           <C>
Balance, beginning of year ............. $ 1,776,000   $ 2,230,000
Amounts advanced .......................     651,000       605,000
Repayments .............................    (557,000)   (1,059,000)
                                         -----------   -----------
Balance, end of year ................... $ 1,870,000   $ 1,776,000
                                         ===========   ===========
</TABLE>
<PAGE>
                                       43


                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================

6.  PREMISES AND EQUIPMENT

    Premises and equipment is summarized as follows:

<TABLE>
<CAPTION>
                                                              December 31,
                                                    ----------------------------
                                                       1997              1996
                                                    ----------        ----------
<S>                                                 <C>               <C>
Building ...................................        $1,066,254        $  992,156
Furniture and equipment ....................           450,664           401,452
Automobiles ................................            38,300            40,412
                                                    ----------        ----------
                                                     1,555,218         1,434,020
Less accumulated depreciation ..............           466,004           380,576
                                                    ----------        ----------
                                                     1,089,214         1,053,444
Land .......................................           404,449           403,549
                                                    ----------        ----------
                                                    $1,493,663        $1,456,993
                                                    ==========        ==========
</TABLE>

7.  INTEREST-BEARING DEPOSITS

    Interest-bearing  deposits  and  related  interest  cost for the years ended
    December 31, 1997 and 1996 are summarized as follows:

<TABLE>
<CAPTION>
                                       1997                      1996
                            -------------------------  -------------------------
                              Deposits       Interest    Deposits      Interest
                            -----------   -----------  -----------   -----------
<S>                         <C>           <C>          <C>           <C>
NOW .....................   $11,071,611   $   380,313  $ 9,335,919   $   347,055
Money market ............     2,093,881        81,398    1,787,254        64,286
Savings .................     7,024,668       239,388    6,719,504       243,010
Certificates of deposits,
   $100,000 or more .....    10,261,339       543,236    8,963,538       380,948
Other time deposits .....    17,843,262       941,856   16,173,494       852,794
                            -----------   -----------  -----------   -----------
                            $48,294,761   $ 2,186,191  $42,979,709   $ 1,888,093
                            ===========   ===========  ===========   ===========
</TABLE>

    At December 31, 1997, scheduled maturities of certificates of deposit are as
    follows:
<TABLE>
<CAPTION>
           <S>              <C>

            1998             $ 24,206,289
            1999                2,829,314
            2000                  714,737
            2001                  184,345
            2002                  169,916
                             ------------
                             $ 28,104,601
                             ============
</TABLE>
<PAGE>
                                       44


                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================

8.  FEDERAL HOME LOAN BANK ADVANCES

    The Bank has an  agreement  for  advances  with the Federal  Home Loan Bank.
    These  advances  are  secured by a blanket  floating  lien  agreement  which
    provides a security interest in all unencumbered first mortgage  residential
    loans and by stock in the Federal Home Loan Bank.

    Advances from the Federal Home Loan Bank are summarized as follows:
<TABLE>
<CAPTION>
                                                     December 31,
                                              -----------------------
                                                 1997         1996
                                              ----------   ----------
<S>                                           <C>          <C>
Advance payable -  interest payable monthly
 at 6.37%, principal due May 14, 1999 .....   $1,000,000

Advance payable - interest payable monthly
 at 7.41%, semi-annual principal reductions
 of $20,000 through June 2006  ............      340,000   $  380,000

Advance payable - interest payable monthly
 at 6.41%, quarterly principal reductions
 of $6,250 through October 2007  ..........      250,000
                                              ----------
                                              $1,590,000   $  380,000
                                              ==========   ==========
</TABLE>

Aggregate annual maturities of FHLB advances:
<TABLE>
<CAPTION>
                    <S>                                    <C>
                    Years ended December 31, 1998          $   65,000
                                         1999               1,065,000
                                         2000                  65,000
                                         2001                  65,000
                                         2002                  65,000
                                   thereafter                 265,000
                                                            ---------
                                                           $1,590,000
                                                           ==========
</TABLE>

9.  OTHER BORROWED FUNDS

    Other  borrowed  funds  consist of  short-term  borrowings  from the Federal
    Reserve Bank under the Treasury Tax and Loan Investment  Program and federal
    funds purchased.

10. CREDIT ARRANGEMENTS

    At December 31, 1997, federal funds line of credit arrangements  aggregating
    $4,000,000   were   available  to  the  Bank  from   corresponding   banking
    institutions.  There are no commitment fees and compensated balances are not
    required.  The Bank  also has a Blanket  Floating  Lien  Agreement  with the
    Federal  Home Loan Bank of  Atlanta.  Under this  agreement,  the Bank has a
    credit line up to seventy-five  percent of the book value of its one-to-four
    family first mortgage loans. These credit arrangements  principally serve as
    liquidity back-up for the Bank.

<PAGE>
                                       45

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================

11. INCOME TAXES

    The provision for income taxes is as follows:
<TABLE>
<CAPTION>
                                         Years Ended December 31,
                                         ------------------------
                                            1997          1996
                                         ----------    ----------
<S>                                      <C>           <C>
Current                                  $ 621,000     $ 510,000
Deferred                                   (41,000)       (2,000)
                                         ----------    ----------
                                         $ 580,000     $ 508,000
                                         ==========    ==========
</TABLE>

    The  provision  for  income  taxes is less than  computed  by  applying  the
    statutory  federal  income tax rate of 34% to income  before income taxes as
    indicated by the following:

<TABLE>
<CAPTION>
                                         Years Ended December 31,
                                         ------------------------
                                            1997          1996
                                         ---------     ----------
<S>                                      <C>            <C>
Income tax at statutory rate ........... $ 591,000      $ 520,000
Increase (decrease) in taxes:
  Tax-exempt interest ..................   (57,000)       (52,000)
  State income taxes, net
   of federal income tax benefit .......    42,000         38,000
  Other ................................     4,000          2,000
                                         ---------      ---------
Provision for income taxes ............. $ 580,000      $ 508,000
                                         =========      =========
</TABLE>

    The components of net deferred tax assets are as follows:

<TABLE>
<CAPTION>
                                              December 31,
                                         -----------------------
                                            1997          1996
                                         --------       --------
Deferred tax assets:
<S>                                      <C>            <C>
  Allowance for loan losses ......       $211,000       $139,000
  Deferred loan fees .............         27,000         31,000
  Unrealized loss on investment
    securities available for sale           4,000         18,000
  Deferred compensation ..........         15,000         32,000
  Other ..........................                         4,000
                                         --------       --------
    Total deferred tax assets ....        257,000        224,000
                                         --------       --------
Deferred tax liabilities:
  Accumulated depreciation .......         79,000         78,000
  Other ..........................         15,000         10,000
                                         --------       --------
    Total deferred tax liabilities         94,000         88,000
                                         --------       --------
Net deferred tax assets ..........       $163,000       $136,000
                                         ========       ========
</TABLE>
<PAGE>
                                       46

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================

12. REGULATORY REQUIREMENTS

    The approval of the Georgia Department of Banking and Finance is required if
    dividends declared by the Bank to the Company in any year will exceed 50% of
    the net income of the Bank for the previous  calendar  year.  As of December
    31, 1997, the Bank could declare approximately $588,000 of dividends without
    prior approval.

    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  possible   additional
    discretionary actions by regulators that, if undertaken, could have a direct
    material effect on the Bank's financial  statements.  Under capital adequacy
    guidelines and the regulatory  framework for prompt corrective  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 the  classification  are also  subject to  qualitative
    judgments by the regulators about  components,  risk  weightings,  and other
    factors.

    Quantitative  measures  established by regulation to ensure capital adequacy
    require  the Bank to maintain  minimum  amounts and ratios (set forth in the
    table  below) of Tier 1 capital  (as  defined in the  regulations)  to total
    average  assets (as defined) and minimum  ratios of Tier 1 and total capital
    (as defined) to risk-weighted assets (as defined).  Management believes,  as
    of December 31, 1997, that the Bank meets all capital adequacy  requirements
    to which it is subject.

    As of March 31, 1997, the most recent notification from the FDIC categorized
    the Bank as well  capitalized  under the  regulatory  framework  for  prompt
    corrective  action.  To be  categorized  as well  capitalized  the Bank must
    maintain minimum total  risk-based,  Tier I risk-based,  and Tier I leverage
    ratios as set forth in the table.  There are no  conditions  or events since
    that  notification  that management  believes have changed the institution's
    category.

<TABLE>
<CAPTION>
                                                                                                To Be Well Capitalized
                                                                           For Capital          Under Prompt Corrective
                                                     Actual             Adequacy Purposes          Action Provisions
                                               Amount      Ratio        Amount      Ratio        Amount          Ratio
                                              -------------------      -------------------      -----------------------
<S>                                           <C>            <C>       <C>             <C>      <C>                <C>
December 31, 1997:
Total Capital  ( to Risk Weighted Assets )
   Consolidated ...........................   $8,010,719     15%       $3,841,155      8%       $4,801,444         10%
   Bank ...................................   $7,572,085     15%       $3,827,336      8%       $4,784,171         10%
Tier 1 Capital  ( to Risk Weighted Assets )
   Consolidated ...........................   $7,427,287     17%       $1,920,578      4%       $2,880,866          6%
   Bank ...................................   $6,988,653     16%       $1,913,668      4%       $2,870,502          6%
Tier 1 Capital ( to Average Assets )
   Consolidated ...........................   $7,427,287     12%       $2,459,564      4%       $3,074,455          5%
   Bank ...................................   $6,988,653     11%       $2,446,624      4%       $3,058,280          5%
December 31, 1996:
Total Capital  ( to Risk Weighted Assets )
   Consolidated ...........................   $7,252,536     16%       $3,735,650      8%       $4,669,562         10%
   Bank ...................................   $6,917,375     15%       $3,735,849      8%       $4,669,812         10%
Tier 1 Capital  ( to Risk Weighted Assets )
   Consolidated ...........................   $6,797,716     15%       $1,867,825      4%       $2,801,737          6%
   Bank ...................................   $6,462,555     14%       $1,867,925      4%       $2,801,887          6%
Tier 1 Capital ( to Average Assets )
   Consolidated ...........................   $6,797,716     12%       $2,186,093      4%       $2,732,616          5%
   Bank ...................................   $6,462,555     12%       $2,177,771      4%       $2,722,214          5%

</TABLE>
<PAGE>
                                       47

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================

13. PROFIT SHARING PLAN

    Effective January 1, 1996, the Bank amended its profit sharing plan to allow
    salary deferrals under Internal  Revenue code section 401(k).  All employees
    of the Bank can participate in the plan after they meet certain  eligibility
    requirements.  Employer  contributions  to the plan are at the discretion of
    the Board of Directors. The Bank contributed $57,351 and $31,592 to the plan
    in 1997 and 1996, respectively.

14. STOCK OPTIONS

    Under the terms of a stock option agreement which expired December 31, 1994,
    certain  officers of the Bank were granted options to purchase shares of the
    Company's  common stock at a price of book value per share at date of grant.
    All options are  exerciseable  upon grant and expire  beginning  in December
    1997 through December 2001.

    Also,  the  Company  adopted an  Incentive  Stock  Option Plan in 1997 which
    provides for granting of stock options to officers and certain key employees
    of the Bank. The exercise price of these options is equal to the fair market
    value of the Company's stock on the date of grant. There are 5,000 remaining
    stock  options  authorized  to be granted under this plan as of December 31,
    1997.  The maximum term of the options is ten years and they vest and become
    exercisable at such times and in such installments as the Board of Directors
    shall provide in each individual stock option agreement.

<TABLE>
<CAPTION>

                                                    1997                               1996
                                      ---------------------------   ---------------------------
                                                      Exercise                      Exercise
                                        Shares         Price          Shares         Price
                                      -----------  --------------   -----------  --------------
<S>                                        <C>     <C>                   <C>     <C>
Options outstanding - beginning            25,000  $9.63 - $11.75        25,000  $9.63 - $11.75
Options granted                             5,000       $19
Options exercised                          (6,500) $9.63 - $10.66
                                      -----------  --------------   -----------  --------------
Options outstanding - ending               23,500  $9.63 - $19.00        25,000  $9.63 - $11.75
                                      ===========  ==============   ===========  ==============
</TABLE>



    The total  stock  options  exercisable  at  December  31, 1997 and 1996 were
    19,500 and 25,000, respectively, which had a weighted average exercise price
    of $11.21 and $10.50, respectively.

    The Company has elected not to adopt the fair value method of accounting for
    employee  stock options as  prescribed by Statement of Financial  Accounting
    Standards (SFAS) No. 123 "Accounting for Stock-Based Compensation" issued by
    the Financial Accounting Standards Board.  Instead, as permitted by SFAS No.
    123, the Company has elected to continue to apply the intrinsic value method
    of accounting prescribed under the provisions of Accounting Principles Board
    Statement No. 25,  "Accounting for Stock Issued to Employees".  Accordingly,
    no  compensation  cost has been  recognized for options granted in 1997. Pro
    forma disclosures of the effects of applying the fair value based method are
    considered immaterial and have been omitted.

<PAGE>
                                       48

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================

15. OTHER NONINTEREST EXPENSES

    The major components of other noninterest expenses are as follows:

<TABLE>
<CAPTION>
                              December 31,
                          -------------------
                            1997       1996
                          --------   --------
<S>                       <C>        <C>
Postage ...............   $ 54,642   $ 52,185
Stationery and supplies     52,434     48,344
Professional services .     62,435     58,599
Director fees .........     58,200     46,000
Other .................    323,546    308,509
                          --------   --------
     Total ............   $551,257   $513,637
                          ========   ========
</TABLE>


16. EARNINGS PER SHARE

    Earnings per share has been  calculated in accordance with the provisions of
    Statement of Financial  Accounting  Standards  (SFAS) No. 128  "Earnings Per
    Share"  issued by the Financial  Accounting  Standards  Board.  SFAS No. 128
    requires  presentation  of earnings per share on a basic  computation  and a
    diluted  computation.  The basic computation  divides net income by only the
    weighted  average number of common shares  outstanding  for the year and the
    diluted  computation  gives  effect to all diluted  common  shares that were
    outstanding during the year.

    Earnings per share amounts for 1996 have been restated to give effect to the
    application of this new standard.

    The  following  data shows the amounts used in computing  earnings per share
    and the  effect  on  income  and the  weighted  average  number of shares of
    dilutive potential common stock.

<TABLE>
<CAPTION>
                                            Years Ended December 31,
                                               1997         1996
                                            -----------------------
<S>                                         <C>          <C>
Income available to common shareholders:
   Used in basic earnings per share .....   $1,157,766   $1,021,323
                                            ==========   ==========
   Used in diluted earnings per share ...   $1,157,766  $1,021,323
                                            ==========   ==========

Weighted average number of common
  shares used in basic earnings per share      503,882      507,902
Effect of dilutive securities:
   Stock options ........................       11,712        7,503
                                            ----------   ----------
Weighted average number of common
   and dilutive potential common shares
   used in diluted earnings per share ...      515,594      515,405
                                            ==========   ==========
</TABLE>
<PAGE>
                                       49

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================


17. FAIR VALUES OF FINANCIAL INSTRUMENTS

    The  following   disclosures  of  the  estimated  fair  value  of  financial
    instruments  is  made  in  accordance  with  requirements  of  Statement  of
    Financial  Standards  No, 107,  "Disclosures  about Fair Value of  Financial
    Instruments".  The estimated fair value amounts have been  determined by the
    Company  using  available  market  information  and  appropriate   valuation
    methodologies.  However,  considerable  judgment is necessarily  required to
    interpret  market data to develop the estimates of fair value.  Accordingly,
    the estimates presented herein are not necessarily indicative of the amounts
    the Company could realize in a current market exchange. The use of different
    market  assumptions  and/or  estimation  methodologies  may have a  material
    effect on the estimated fair value amounts.

    The following methods and assumptions were used by the Company in estimating
    fair values of financial instruments:

    Cash and cash  equivalents,  interest-bearing  deposits  in other  financial
    institutions,  federal  funds sold and  accrued  interest  receivable  - The
    carrying  amounts of these assets  approximates  fair value because of their
    short-term maturities.

    Investments  Securities - Fair values for investment securities are based on
    quoted market prices.

    Loans  - For  variable-rate  loans  that  reprice  frequently  and  have  no
    significant change in credit risk, fair values are based on carrying values.
    The fair values for all other loans are estimated using discounted cash flow
    analysis,  using  interest  rates  currently  being  offered  for loans with
    similar terms to borrowers of similar credit quality.  The carrying value of
    off-balance-sheet commitments approximates fair value based on the fact that
    the Company  generally  does not offer lending  commitments to its customers
    for long periods and, the underlying  rates of the  commitments  approximate
    market rates.

    Deposit  liabilities - Fair values of  certificates of deposit are estimated
    using a  discounted  cash  flow  calculation  that  applies  interest  rates
    currently being offered on certificates of similar terms and maturities. The
    carrying  amounts of all other  deposits,  due to their nature,  approximate
    their fair values.

    Federal Home Loan Bank advances - Fair value for fixed-rate  borrowings from
    the  Federal  Home  Loan Bank are  estimated  using a  discounted  cash flow
    calculation  that  considers  interest  rates  currently  being  offered  on
    advances of similar terms to maturity.

    Other borrowed funds - The carrying  amounts of federal funds  purchased and
    other short-term borrowings approximate their fair values.

<PAGE>
                                       50

                  BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================


    The carrying  values and estimated  fair values of the  Company's  financial
    instruments were as follows:

<TABLE>
<CAPTION>
                                    December 31, 1997           December 31, 1996
                                -------------------------   -------------------------
                                  Carrying       Fair         Carrying       Fair
                                   Value         Value         Value         Value
                                -----------   -----------   -----------   -----------
<S>                             <C>           <C>           <C>           <C>
Financial assets:
  Cash and due from banks ...   $ 2,039,246   $ 2,039,246   $ 2,296,408   $ 2,296,408
  Interest-bearing deposits .       990,000       990,000
  Federal funds sold ........        38,000        38,000     5,530,000     5,530,000
  Investment securities:
     Available for sale .....     9,305,642     9,305,642     5,289,372     5,289,372
     Held to maturity .......     3,345,619     3,466,339     3,194,200     3,330,320
  Loans .....................    48,197,054    48,409,461    42,260,259    42,298,473
  Accrued interest receivable       452,262       452,262       373,089       373,089

Financial liabilities:
  Deposits ..................   $55,980,085   $56,150,661   $52,604,076   $52,734,792
  Federal Home Loan advances      1,590,000     1,619,400       380,000       380,000
  Other borrowed funds ......       130,000       130,000        53,195        53,195

</TABLE>




18. SUPPLEMENTAL CASH FLOW INFORMATION

    Certain  supplemental  disclosure  of  cash  flow  information  and  noncash
    investing and financing activities:

<TABLE>
<CAPTION>
                                               Years Ended December 31,
                                              -------------------------
                                                 1997          1996
                                              -----------   -----------
<S>                                           <C>           <C>
Cash paid during the year for:
  Income taxes ............................   $   632,818   $   685,301
                                              ===========   ===========
  Interest ................................   $ 2,276,856   $ 1,908,358
                                              ===========   ===========

Noncash investing and financing activities:
  Net unrealized gain (loss) on investment
    securities available for sale .........   $    20,803   $   (19,435)
                                              ===========   ===========
</TABLE>

<PAGE>
                                       51

                 BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================

19. BRYAN BANCORP OF GEORGIA, INC.  (PARENT ONLY) FINANCIAL INFORMATION

    Bryan  Bancorp of Georgia,  Inc.  condensed  balance  sheets and the related
    condensed statements of income and cash flows follow:

<TABLE>
<CAPTION>

Condensed Balance Sheets
-----------------------------------------------------
                                                              December 31,
                                                       -------------------------
                                                           1997          1996
                                                       -----------   -----------
<S>                                                    <C>           <C>
Assets
  Cash .............................................   $   112,140   $    49,667
  Land .............................................       301,494       301,494
  Other Assets .....................................        63,000        22,000
  Investment in subsidiary .........................     6,982,245     6,435,343
                                                       -----------   -----------
     Total Assets ..................................   $ 7,458,879   $ 6,808,504
                                                       ===========   ===========
Liabilities
  Deferred compensation payable ....................   $    38,000   $    38,000
                                                       -----------   -----------
Shareholders' equity
  Common Stock .....................................   $   528,258   $   521,758
  Additional paid-in capital .......................     4,963,745     4,869,485
   Retained Earnings ...............................     2,444,135     1,715,073
  Net unrealized loss on investment securities
    available for sale, net of deferred income taxes        (6,409)      (27,212)
                                                       -----------   -----------
                                                         7,929,729     7,079,104
  Treasury stock ...................................      (508,850)     (308,600)
                                                       -----------   -----------
     Total shareholders' equity ....................     7,420,879     6,770,504
                                                       -----------   -----------
     Total liabilities and shareholders' equity ....   $ 7,458,879   $ 6,808,504

                                                       ===========   ===========
Condensed  Statements of Income
-------------------------------
                                                        Years Ended December 31,
                                                       -------------------------
                                                           1997          1996
                                                       -----------   -----------
Income
  Dividends from Bank ..............................   $   650,000   $   458,000
  Interest income ..................................         1,338         5,859
                                                       -----------   -----------
                                                           651,338       463,859
Expenses ...........................................        29,671        23,250
                                                       -----------   -----------
Income before income tax benefit
  and equity  in undistributed income of Bank ......       621,667       440,609
Income tax benefit .................................        10,000         7,000
                                                       -----------   -----------
Income before equity in undistributed
  income of Bank ...................................       669,667       447,609
Equity in undistributed income of Bank .............       526,099       573,714
                                                       -----------   -----------
Net income .........................................   $ 1,157,766   $ 1,021,323
                                                       ===========   ===========
</TABLE>
<PAGE>
                                       52

                 BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 1997 and 1996

================================================================================

<TABLE>
<CAPTION>
Condensed Statements of Cash Flows
----------------------------------
                                                        Years Ended December 31,
                                                       -------------------------
                                                           1997          1996
                                                       -----------   -----------
Operating Activities
<S>                                                    <C>           <C>
   Net income ......................................   $ 1,157,766   $ 1,021,323
   Adjustments to reconcile net income
    to net cash provided by operating activities:
       Equity in undistributed income of Bank ......      (526,099)     (573,714)
       Net (increase) in other assets ..............       ( 3,000)       (5,422)
                                                       -----------   -----------
          Net cash provided by operating activities        628,667       442,187
                                                       -----------   -----------
Investing Activities
  Purchase of land .................................                    (301,494)
          Net cash (used) for investing activities .                    (301,494)
                                                       -----------   -----------
Financing Activities
  Purchase of treasury stock .......................      (200,250)     (250,800)
  Exercise of stock options       ..................        62,760
  Dividends paid ...................................      (428,704)     (354,591)
                                                       -----------   -----------
          Net cash (used) for financing activities .      (566,194)     (605,391)
                                                       -----------   -----------
Increase (decrease) in cash ........................        62,473      (464,698)
Cash - beginning of year ...........................        49,667       514,365
                                                       -----------   -----------
Cash - end of year .................................   $   112,140   $    49,667
                                                       ===========   ===========
</TABLE>



20. SUBSEQUENT EVENT

    On February 10,  1998,  the Company  signed a definitive  agreement to merge
    with The  Savannah  Bancorp,  Inc.,  a bank  holding  company  that owns The
    Savannah Bank located in Savannah,  Georgia. This merger would result in The
    Savannah Bancorp, Inc. acquiring all of the Company's outstanding stock in a
    business  combination   accounted  for  as  a  pooling  of  interest.   Upon
    consummation of this merger,  which is subject to regulatory and shareholder
    approvals, shareholders of the Company would receive 1.85 shares of stock in
    The  Savannah  Bancorp,  Inc.  in exchange  for each share of the  Company's
    stock.

<PAGE>
                                       53



                                   SIGNATURES

Pursuant to the requirements of Section 15(d) 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.


                             BRYAN BANCORP OF GEORGIA, INC.


Date: March 6, 1998          By:  /s/ E. James Burnsed
      -------------               ----------------------------------------------
                                  E. James Burnsed
                                  President and Chief Executive Officer
                                  (principal executive, financial and accounting
                                  officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the  following  persons on behalf of the  Registrant in
the capacities and on the dates indicated.

SIGNATURES                               TITLE                       DATE
----------                               -----                       ----


/s/ E. James Bunsed             President, Chief Executive         March 6, 1998
-------------------------                                          -------------
E. James Burnsed                Officer and Director



/s/ J. Carl Cox, Jr.                   Director                    March 6, 1998
-------------------------                                          -------------
J. Carl Cox, Jr.



/s/ L. Carlton Gill                    Director                    March 6, 1998
-------------------------                                          -------------
L. Carlton Gill



/s/ Jonh R. Harvey                     Director                    March 6, 1998
-------------------------                                          -------------
John R. Harvey



/s/ Thomas A. Lancaster                Director                    March 6, 1998
-------------------------                                          -------------
Thomas A. Lancaster



/s/ Juanita B. Phillips                Director                    March 6, 1998
-------------------------                                          -------------
Juanita B. Phillips



/s/ James T. Roberts, Sr.              Director                    March 6, 1998
-------------------------                                          -------------
James T. Roberts, Sr.



                       (SIGNATURES CONTINUED ON NEXT PAGE)

<PAGE>
                                       54



SIGNATURES                               TITLE                       DATE
----------                               -----                       ----




/s/ James W. Royal                Secretary and Director           March 6, 1998
-------------------------                                          -------------
James W. Royal



/s/ Jimmy F. Sommers                   Director                    March 6, 1998
-------------------------                                          -------------
Jimmy F. Sommers



/s/ Charles L. Stafford            Chairman of the Board           March 6, 1998
-------------------------                                          -------------
Charles L. Stafford



/s/ Robert T. Thompson                 Director                    March 6, 1998
-------------------------                                          -------------
Robert T. Thompson





SUPPLEMENTAL  INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(d) OF THE ACT BY REGISTRANT WHICH HAVE NOT REGISTERED  SECURITIES PURSUANT TO
SECTION 12 OF THE ACT.

No annual  report or proxy has been sent to  security  holders as of the date of
filing this report.  An annual report and proxy  materials  will be furnished to
security  holders  subsequent to the filing if this report,  and the  Registrant
shall furnish  copies of such material to the  Commission  when they are sent to
security holders.