<PAGE>   1

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-KSB/A
                                 AMENDMENT NO. 1

(MARK ONE)
X        Annual Report under Section 13 or 15(d) of the Securities Exchange Act
-        of 1934 For the fiscal year ended December 31, 2000

                                       OR

         Transition Report under Section 13 or 15(d) of the Securities Exchange
------
         Act of 1934

             For the transition period from            to
                                            ----------    ----------

                          Commission file no. 000-22503

                      BEACH FIRST NATIONAL BANCSHARES, INC.
                   ------------------------------------------
                 (Name of Small Business Issuer in Its Charter)

<TABLE>
<S>                                                         <C>
             South Carolina                                     58-1030117
     ------------------------------                         ------------------
      (State or Other Jurisdiction                           (I.R.S. Employer
    of Incorporation or Organization)                       Identification No.)

             1550 Oak Street
      Myrtle Beach, South Carolina                                 29577
  -------------------------------------                         -----------
(Address of Principal Executive Offices)                        (Zip Code)
</TABLE>


                                 (843) 626-2265
                  ---------------------------------------------
                 Issuer's Telephone Number, Including Area Code

        Securities registered pursuant to Section 12(b) of the Act: None
    Securities registered pursuant to Section 12(g) of the Act: Common Stock

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

         Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B 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. [ ]

         The aggregate market value of the voting stock held by non-affiliates
of the registrant as of June 7, 2001 was $6,678,324. This calculation is based
upon $12.00, the last trade price of the common stock of which the Company is
aware. There is no active trading market for the common stock and trades are
limited and sporadic.

         There were 737,368 shares of the Company's common stock issued and
outstanding as of June 7, 2001.

         Transitional Small Business Disclosure Format.
(Check one):  Yes     No   X
                 ---       -

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      None.
<PAGE>   2
         The registrant hereby amends its annual report on Form 10-KSB for the
year ended December 31, 2000 by deleting the text under Part I, Item 6:
Management's Discussion and Analysis of Financial Condition and Results of
Operations and Item 7: Financial Statements, and replacing it with the
following:

PART I. ITEM 6: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

OVERVIEW

         We commenced operations on September 23, 1996 and completed our fourth
full year of operations on December 31, 2000. From the outset, we have focused
on serving the banking needs of small businesses and individuals, and we have
emphasized our local management and ownership. We have grown steadily each year,
increasing from $27.0 million in total assets at December 31, 1997 to $38.0
million at December 31, 1998, $46.2 million at December 31, 1999, and $63.8
million at December 31, 2000. We enjoyed our first quarterly profit in the
second quarter of 1999, and we have been profitable each subsequent quarter
through the date of this prospectus.

         In March 2000, Walt Standish became our new president and chief
executive officer. Mr. Standish has strong ties to the business community in
Myrtle Beach, having served as Bank of America's retail executive for the Grand
Strand from 1990 to 1995. Under Mr. Standish's leadership, we have begun to grow
more rapidly. Our total assets have increased to $63.8 million at December 31,
2000, a 38% increase since December 31, 1999, and our net income was $231,000
for the year ended December 31, 2000, an increase of $178,000, or 336%, over the
same period in 1999.

         The following table sets forth selected measures of our financial
performance for the periods indicated:

<TABLE>
<CAPTION>
                                                   YEARS ENDED DECEMBER 31,
                                                   ------------------------
                                  2000              1999              1998              1997
                                  ----              ----              ----              ----
<S>                            <C>               <C>               <C>               <C>
Total Revenues (1)........     $2,226,214        $1,837,082        $1,284,571          $776,565
Net Income (loss).........        230,723            52,921         (233,183)         (246,389)
Total Assets..............     63,770,016        46,155,395        37,944,622        26,938,244
Total Loans...............     45,622,155        32,537,992        21,095,556        11,288,106
Total Deposits............     56,726,511        36,836,020        31,135,042        20,071,921
</TABLE>

         (1) Total revenue equals net interest income plus total noninterest
income.

         The following discussion contains our analysis of our financial
condition and results of operations beginning with the year ended December 31,
1998. Comparisons of our results for the periods presented should be made with
an understanding of our short history.

ANALYSIS OF THE FISCAL YEARS ENDED DECEMBER 31, 1998 AND 1999 AND 2000

NET INCOME

         For the year ended December 31, 2000, our net income was $230,723, or
$.31 per basic common share, as compared to $52,921, or $.07 per basic common
share, for the year ended December 31, 1999, and as compared to a loss of
($233,183) or ($0.32) per basic common share for the year ended December 31,
1998. Our net income increased in 2000 and 1999 primarily due to increases in
net interest income and noninterest income that resulted from the significant
growth in our assets and deposits over this period.

         Our earnings in 2000, 1999 and 1998 were reduced by expenses we
incurred related to a check kiting operation discovered in 1998. We incurred an
aggregate of approximately $100,000 in 1998, $60,000 in 1999, and $59,000 in
2000 in expenses related to this kiting operation. In March 1999, we settled one
lawsuit related to the kiting issue and the matter was fully settled in August
2000. All expenses related to this kiting operation are reflected in the
Financial Statements and we do not expect to incur any material additional
expenses related to this matter.

                                       2
<PAGE>   3
         We had total assets of $63.8 million at December 31, 2000, an increase
of 38.1% from $46.2 million at December 31, 1999. Our total deposits increased
to $56.7 million at December 31, 2000, up 54.1% from $36.8 million at December
31, 1999. Our return on average assets for 2000 was 0.41% compared to 0.13% in
1999 and (0.72%) in 1998; and our return on average equity was 3.54% in 2000
versus .83% in 1999 and (3.53%) in 1998. The improvement in net income in 2000
reflects our growth since Mr. Standish became our chief executive officer, with
average earning assets increasing 39.9% to $52.6 million during 2000 from $37.6
million during the same period of 1999. The improvement in net income in 1999
over 1998 also reflects our continued strong growth trends.

NET INTEREST INCOME

         General. Our primary source of revenue is net interest income, which is
the difference between the income on interest-earning assets and expense on
interest-bearing liabilities. Our net interest income increased $501,688, or
29.8%, to $2.2 million in 2000 from $1.7 million in 1999. Net interest income
increased $534,708 in 1999 from $1.1 million in 1998. The increase in net
interest income was due primarily to the growth of our bank, as reflected in an
increase in our average earning assets. Average earning assets increased to
$52.6 million during 2000, a 39.9% increase from $37.6 million in 1999, and a
28% increase from $29.4 million in 1998.

         Net interest spread, the difference between the rate we earn on
interest-earning assets and the rate we pay on interest-bearing liabilities, was
3.11% for the year ended December 31, 2000, compared to 3.25% for the year ended
December 31, 1999 and 2.47% for the year ended December 31, 1998. Our net
interest margin, which is net interest income divided by average
interest-earning assets, was 4.15% for the year ended December 31, 2000, 4.47%
for the year ended December 31, 1999, and 3.90% for the year ended December 31,
1998. The decrease in 2000 resulted primarily from an increase in the rate we
paid to attract interest-bearing deposits. The increase in the net interest
margin from 1998 to 1999 primarily resulted from a 72% increase in average
outstanding loans. These loans earned greater yields and represented a larger
component of the total earning assets for the year ended December 31, 1999.

         Average Balances, Income and Expenses and Rates. The following tables
set forth, for the periods indicated, information related to our average balance
sheet and average yields on assets and average rates paid on liabilities. We
derived these yields or rates by dividing income or expense by the average
balance of the corresponding assets or liabilities. We derived average balances
from the daily balances throughout the periods indicated.

                                       3
<PAGE>   4
                AVERAGE BALANCES, INCOME AND EXPENSES, AND RATES

<TABLE>
<CAPTION>
                                 For the year ended                  For the year ended                 For the year ended
                                  December 31, 2000                   December 31, 1999                  December 31, 1998
                           -------------------------------     ------------------------------    --------------------------------

                           Average       Income/    Yield/     Average      Income/    Yield/    Average      Income/      Yield/
                           Balance       Expense     Rate      Balance      Expense     Rate     Balance      Expense       Rate
                           -------       -------     ----      -------      -------     ----     -------      -------       ----
<S>                     <C>            <C>           <C>    <C>           <C>          <C>    <C>           <C>           <C>
Federal funds sold
and short term
investments..........   $  4,853,585   $   334,086   6.88%  $    801,068  $    43,459  5.43%  $  2,458,164  $   133,807    5.44%

Investment securities      8,692,972       586,035   6.74%     9,749,303      628,112  6.44%    11,205,990      722,708    6.45%
Loans................     39,031,825     3,713,902   9.52%    27,040,512    2,469,213  9.13%    15,747,900    1,444,855    9.17%
                          ----------     ---------   ----     ----------    ---------  ----     ----------    ---------    ----
  Total earning
assets...............   $ 52,578,382   $ 4,634,023   8.92%  $ 37,590,883  $ 3,140,784  8.36%  $ 29,412,054  $ 2,301,370    7.82%
                          ==========     =========   ====     ==========    =========  ====     ==========    =========    ====

Interest-bearing
deposits
    N.O.W............   $  1,573,091   $    37,008   2.35%  $  1,135,096  $    21,980  1.94%       837,432       18,402    2.20%
    M.M.A............      6,353,302       347,246   5.47%     3,734,063      162,990  4.36%     2,854,701      135,961    4.76%
    Savings..........      3,841,637       183,514   4.78%     4,638,585      193,992  4.18%     4,903,157      228,540    4.66%
    CD's <$100,000...     16,953,510     1,052,712   6.21%    10,940,699      617,442  5.64%     6,845,980      403,313    5.89%
    CD's >$100,000...      9,594,329       593,197   6.18%     4,749,532      266,550  5.61%     4,094,501      237,208    5.79%
    IRA..............      2,962,456       183,101   6.18%     2,766,959      164,737  5.95%     1,877,100      115,887    6.17%
                           ---------       -------   ----      ---------      -------  ----      ---------      -------    ----
    Total interest-
    bearing
    deposits.........   $ 41,278,325   $ 2,396,778   5.81%  $ 27,964,934  $ 1,427,691  5.11%  $ 21,412,871  $ 1,139,311     .32%
                          ==========     =========   ====     ==========    =========  ====     ==========    =========     ===

Other borrowings.....        893,142        53,406   5.98%       594,934       30,942  5.20%       132,820       14,616   11.00%
                             -------        ------   ----        -------       ------  ----        -------       ------   -----
    Total interest-
    bearing
    liabilities......   $ 42,171,467   $ 2,450,184   5.81%  $ 28,559,868  $ 1,458,633  5.11%  $ 21,545,691  $ 1,153,927    5.36%
                          ==========     =========   ====     ==========    =========  ====     ==========    =========    ====

Net interest spread..                                3.11%                             3.25%                               2.47%
Net interest
income/margin........                  $ 2,183,839   4.15%                $ 1,682,151  4.47%                $ 1,147,443    3.90%
                                         =========   ====                   =========  ====                   =========    ====
</TABLE>

                                       4
<PAGE>   5
         Analysis of Changes in Net Interest Income. The following tables set
forth the effect which the varying levels of earning assets and interest-bearing
liabilities and the applicable rates have had on changes in net interest income
for the periods presented. The change in net interest income is primarily due to
the increases in volume of both loans and deposits rather than changes in
average rates.


                   ANALYSIS OF CHANGES IN NET INTEREST INCOME

<TABLE>
<CAPTION>
                                       For the year ended December 31,                  For the year ended December 31,
                                               2000 versus 1999                                 1999 versus 1998
                                 -------------------------------------------      ------------------------------------------
                                   Volume            Rate        Net change         Volume           Rate        Net change
                                 -----------      ---------      -----------      ---------        --------      -----------
<S>                              <C>              <C>            <C>              <C>              <C>           <C>
Federal funds sold and short
term investments ..............  $   278,946      $  11,681      $   290,627      $   (89,900)     $   (448)     $   (90,348)

Investment securities .........      (71,212)        29,135          (42,077)         (93,849)         (747)         (94,596)
Loans .........................    1,140,981        103,708        1,244,689        1,031,188        (6,830)       1,024,358
                                 -----------      ---------      -----------      -----------      --------      -----------
     Total earning assets .....    1,348,715        144,524        1,493,239          847,439        (8,025)         839,414

Interest-bearing deposits .....      773,027        196,060          969,087          334,502       (46,122)         288,380
Other borrowings ..............       17,832          4,632           22,464           24,034        (7,708)          16,326
                                 -----------      ---------      -----------      -----------      --------      -----------
     Total interest-bearing
            liabilities .......      790,859        200,692          991,551          358,536       (53,830)         304,706
                                 -----------      ---------      -----------      -----------      --------      -----------

Net interest income ...........  $   557,856      $ (56,168)     $   501,688      $   488,903      $ 45,805      $   534,708
                                 ===========      =========      ===========      ===========      ========      ===========
</TABLE>

         Interest Rate Sensitivity. A significant portion of our assets and
liabilities are monetary in nature, and consequently they are very sensitive to
changes in interest rates. This interest rate risk is our primary market risk
exposure, and it can have a significant effect on our net interest income and
cash flows. We review our exposure to market risk on a regular basis, and we
manage the pricing and maturity of our assets and liabilities to diminish the
potential adverse impact that changes in interest rates could have on our net
interest income.

         One monitoring technique we employ is the measurement of our interest
rate sensitivity "gap," which is the difference between the amount of
interest-earning assets and interest-bearing liabilities that mature or may
reprice within a given period of time. A gap is considered positive when the
amount of interest-rate sensitive assets exceeds the amount of interest-rate
sensitive liabilities, and it is considered negative when the amount of
interest-rate sensitive liabilities exceeds the amount of interest-rate
sensitive assets. We generally would benefit from increasing market interest
rates when we have an asset-sensitive, or a positive, interest rate gap and we
would generally benefit from decreasing market interest rates when we have
liability-sensitive, or a negative, interest rate gap. When measured on a "gap"
basis, we are liability-sensitive over the cumulative one-year time frame as of
December 31, 1999 and December 31, 2000. However, gap analysis is not a precise
indicator of our interest sensitivity position. The analysis presents only a
static view of the timing of maturities and repricing opportunities, without
taking into consideration that changes in interest rates do not affect all
assets and liabilities equally. For example, rates paid on a substantial portion
of core deposits may change contractually within a relatively short time frame,
but we believe those rates are significantly less interest-sensitive than
market-based rates such as those paid on non-core deposits.

         Net interest income is also affected by other significant factors,
including changes in the volume and mix of interest-earning assets and
interest-bearing liabilities. We perform asset/liability modeling to assess the
impact of varying interest rates and the impact that balance sheet mix
assumptions will have on net interest income. We attempt to manage interest rate
sensitivity by repricing assets or liabilities, selling securities
available-for-sale, replacing an asset or liability at maturity, or adjusting
the interest rate during the life of an asset or liability. Managing the amount
of assets and liabilities that reprice in the same time interval helps us to
hedge risks and minimize the impact on net interest income of rising or falling
interest rates. We evaluate interest sensitivity risk and then formulate
guidelines regarding

                                       5
<PAGE>   6
asset generation and repricing, funding sources and pricing, and off-balance
sheet commitments in order to decrease interest rate sensitivity risk.

         The following tables summarize the amounts of interest-earning assets
and interest-bearing liabilities outstanding at December 31, 2000 and 1999 that
are expected to mature, prepay, or reprice in each of the future time periods
shown. Except as stated in the following tables, we determined the amount of
assets or liabilities that mature or reprice during a particular period in
accordance with the contractual terms of the asset or liability. We included
adjustable rate loans in the period in which interest rates are next scheduled
to adjust rather than in the period in which they are due, and we included fixed
rate loans in the periods in which we anticipate they will be repaid based on
scheduled maturities. We included our savings accounts and interest-bearing
demand accounts (NOW and money market deposit accounts), which are generally
subject to immediate withdrawal, in the "Three Months or Less" category,
although our historical experience has proven these deposits to be more stable
over the course of a year.

                                       6
<PAGE>   7
                          INTEREST SENSITIVITY ANALYSIS
                                DECEMBER 31, 2000

<TABLE>
<CAPTION>
                                                       After three but    After one but
                                    Within Three        Within twelve      Within five      After five
                                       Months              Months             years           years            Total
<S>                                 <C>                <C>                <C>               <C>             <C>
ASSETS
Earning assets:
   Federal funds sold and short
     term investments ............   $  6,721,000       $    198,000       $        --      $       --      $ 6,919,000
   Investment securities .........             --          1,894,642                --       6,291,391        8,186,033
   Loans .........................     11,675,149          2,217,518        29,260,680       2,468,808       45,622,155
                                     ------------       ------------       -----------      ----------      -----------
        Total earning assets .....   $ 18,396,149       $  4,310,160       $29,260,680      $8,760,199      $60,727,188
                                     ------------       ============       ===========      ----------      ===========
LIABILITIES
Interest-bearing liabilities
   Money market and NOW ..........   $ 14,235,469       $         --       $        --      $       --      $14,235,469
   Regular savings deposits ......        362,147                 --                --              --          362,147
   Prime savings deposits ........      2,769,831                 --                --              --        2,769,831
   Time deposits
            < $100,000 ...........      3,797,628         10,854,194         6,237,378         292,654       21,181,854
            > $100,000 ...........      6,017,908          4,718,983         1,806,855         108,212       12,651,958
   Other borrowings ..............             --                 --                --              --               --
                                     ------------       ------------       -----------      ----------      -----------
   Total interest-bearing
liabilities ......................   $ 27,182,983       $ 15,573,177       $ 8,044,233      $  400,866      $51,201,259
                                     ============       ============       ===========      ==========      ===========

Period gap .......................   $ (8,786,834)      $(11,263,017)      $21,216,447      $8,359,333      $ 9,525,929
Cumulative gap ...................   $ (8,786,834)      $(20,049,851)      $ 1,166,596      $9,525,929      $ 9,525,929
Ratio of cumulative gap to total
earning assets ...................         (14.47)%           (33.00)%            1.92%          15.69%
</TABLE>


                                DECEMBER 31, 1999

<TABLE>
<CAPTION>
                                                       After three but    After one but
                                     Within Three       Within twelve      Within five      After five
                                        Months             Months             years           years            Total
                                        ------             ------             -----           -----            -----
<S>                                  <C>               <C>                <C>               <C>              <C>
ASSETS
Earning assets:
   Federal funds sold and short
term investments .................   $         --       $         --       $        --      $        --      $        --

   Investment securities .........             --          2,630,803                --        6,652,357        9,283,159
   Loans .........................      7,475,837          1,499,362        21,107,664        2,455,129       32,537,992
                                     ------------       ------------       -----------      -----------      -----------
        Total earning assets .....   $  7,475,837       $  4,130,165       $21,107,664      $        --      $41,821,151
                                     ============       ============       ===========                       ===========
LIABILITIES
Interest-bearing liabilities
   Money market and NOW ..........   $  5,458,077       $         --       $        --      $        --      $ 5,458,077
   Regular savings deposits ......        399,608                 --                --               --      $   399,608
   Prime savings deposits ........      4,112,452                 --                --               --        4,112,452
   Time deposits .................             --
        <$100,000 ................      2,450,837          7,687,102         4,189,645                        14,327,584
        >$100,000 ................      1,024,334          1,835,106         3,814,379                         6,673,819
   Other borrowings ..............        920,000                 --                --        1,900,000        2,820,000
                                     ------------       ------------       -----------      -----------      -----------
   Total interest-bearing
liabilities ......................   $ 14,365,308       $  9,522,208       $ 8,004,024      $ 1,900,000      $33,791,540
                                     ============       ============       ===========      ===========      ===========

Period gap .......................   $ (6,889,471)      $ (5,392,043)      $13,103,640      $ 7,207,486      $ 8,029,611
Cumulative gap ...................   $ (6,889,471)      $(12,281,514)      $   822,126      $ 8,029,611      $ 8,029,611
Ratio of cumulative gap to total
earning assets ...................         (16.47)%           (29.37)%            1.97%           19.20%
</TABLE>


                                       7
<PAGE>   8
PROVISION AND ALLOWANCE FOR LOAN LOSSES

         General. We have established an allowance for loan losses through a
provision for loan losses charged to expense. The allowance represents an amount
which we believe will be adequate to absorb probable losses on existing loans
that may become uncollectible. Our judgment in determining the adequacy of the
allowance is based on evaluations of the collectibility of loans, including
consideration of factors such as the balance of impaired loans, the quality,
mix, and size of our overall loan portfolio, economic conditions that may affect
the borrower's ability to pay, the amount and quality of collateral securing the
loans, our historical loan loss experience, and a review of specific problem
loans. We adjust the amount of the allowance periodically based on changing
circumstances. We charge recognized losses to the allowance for loan losses, and
we add any subsequent recoveries back to the allowance. We consider a loan to be
impaired when it is probable that we will be unable to collect all principal and
interest payments due in accordance with the terms of the loan agreement. We
measure individually identified impaired loans based on the present value of
expected payments, using the contractual loan rate as the discount rate.
Alternatively, we may base measurement on observable market prices, or, for
loans that are solely dependent on the collateral for repayment, the fair value
of the collateral. If the recorded investment in the impaired loan exceeds the
measure of fair value, we establish a valuation allowance as a component of the
allowance for loan losses. We record changes to the valuation allowance as a
component of the provision for loan losses.

         In addition, regulatory agencies, as an integral part of their
examination process, periodically review our allowance for loan losses, and they
may require us to record additions to the allowance based on their review of
information available to them at the time of their examinations.

         At December 31, 2000, our allowance for possible loan losses was
$569,245, or 1.25% of outstanding loans, compared to an allowance for possible
loans losses of $408,878, or 1.26% of outstanding loans at December 31, 1999,
and $263,215, or 1.25% at December 31, 1998. Our provision for loan losses was
$251,107 in 2000 compared to $154,168 in 1999 and $272,500 in 1998.

         In 2000, 1999, and 1998 the Bank charged-off $91,000, $8,000 and
$100,000, respectively. The 2000 charge-offs included $77,000 of commercial real
estate loans and $14,000 of consumer real estate loans. The 1998 charge-offs
included $19,000 of consumer loans, $61,000 of commercial business loans and
$100,000 due to the uncollectibility of overdraft amounts owed to the Bank and
related to a kiting scheme involving two of the Bank's commercial deposit
customers. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations-Noninterest Expense."

         We discontinue accrual of interest on a loan when we conclude it is
doubtful that we will be able to collect interest from the borrower. We reach
this conclusion by taking into account factors such as the borrower's financial
condition, economic and business conditions, and the results of our previous
collection efforts. Generally, we will place a delinquent loan in nonaccrual
status when the loan becomes 90 days or more past due. When we place a loan in
nonaccrual status, we reverse all interest which has been accrued on the loan
but remains unpaid and we deduct this interest from earnings as a reduction of
reported interest income. We do not accrue any additional interest on the loan
balance until we conclude the collection of both principal and interest is
reasonably certain. At December 31, 2000, there were no loans accruing interest
for loans which were 90 days or more past due, and we did not have any
restructured loans.

         We had two nonaccruing loans totaling $104,815 at December 31, 2000.
These loans are both subject to SBA conditional guarantees and we believe that
we will recover 80% of the face amount of these loans. We had no nonaccruing
loans at December 31, 1999 or December 31, 1998. Interest income that would have
been received for the year ended December 31, 2000 had nonaccruing loans been
current in accordance with their original terms amounted to $5,730.

         We do not include loans that are current as to principal and interest
in our nonperforming assets categories. However, we will still classify a
current loan as a potential problem loan if we develop serious doubts about the
borrower's future performance under the terms of the loan contract. We consider
the level of potential problem loans in

                                       8
<PAGE>   9
our determination of the adequacy of the allowance for loan losses. At December
31, 2000, 1999, and 1998, we did not have any loans we considered to be
potential problem loans.

         The following table sets forth certain information with respect to our
allowance for loan losses and the composition of charge-offs and recoveries for
the years ended December 31, 2000, 1999 and 1998.

                            ALLOWANCE FOR LOAN LOSSES
                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                                                                DECEMBER 31,
                                                    ------------------------------------
                                                      2000         1999            1998
                                                      ----         ----            ----
<S>                                                 <C>          <C>             <C>
Average loans outstanding .....................     $39,032      $27,041         $15,748
                                                    =======      =======         =======
Loans outstanding at period end ...............     $45,622      $32,538         $21,095
                                                    =======      =======         =======
Total nonperforming loans .....................         105            0               0
                                                    =======      =======         =======

Beginning balance of allowance ................         409          263             170
Loans charged off: ............................          91            8             179
Real Estate ...................................     $    --      $    --              --
Commercial ....................................          77            7             161
Consumer ......................................          14            1              19
                                                    -------      -------         -------
Total loans charged off: ......................          91            8             180
Recoveries:
      Real Estate .............................     $    --      $    --              --
      Commercial ..............................          --           --               1
      Consumer ................................          --           --              --
      Total recoveries: .......................          --           --               1
                                                    -------      -------         -------
Net loans charged off .........................          91            8             179

Provision for loan losses .....................         251          154             273
                                                    -------      -------         -------
Balance at period end .........................     $   569      $   409         $   264
                                                    =======      =======         =======

Net charge-offs to average loans ..............        0.23%        0.03%           1.14%
Allowance as a percent of total loans .........        1.25%        1.26%           1.25%

Nonperforming loans as a percentage of
   total loans ................................        0.23%          --              --

Nonperforming loans as a percentage of
   allowance ..................................       18.41%          --              --
 Ratio of net charge-offs to average gross
   loans outstanding during the period ........         .23%         .03%           1.14%(1)
                                                    =======      =======         =======
</TABLE>

(1) Includes charge-off of $100,000 related to an overdraft of commercial
account. Please see "Management's Discussion and Analysis of Financial Condition
and Results of Operations - Noninterest Expense."

                                       9
<PAGE>   10
       The following table sets forth the breakdown of the allowance for loan
losses by loan category and the percentage of loans in each category to total
loans for the periods indicated. We believe that the allowance can be allocated
by category only on an approximate basis. The allocation of the allowance to
each category is not necessarily indicative of further losses and does not
restrict the use of the allowance to absorb losses in any category.

                   ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES

<TABLE>
<CAPTION>
                                                    AS OF DECEMBER 31,
                          --------------------------------------------------------------------
                                    2000                   1999                    1998
<S>                       <C>            <C>      <C>            <C>      <C>            <C>
Residential
     Real estate .....    $339,042        59.6%   $238,948        58.4%   $137,088        52.3%
     Construction ....      44,970         7.9%     42,196        10.3%     17,872         6.8%
Commercial ...........     108,783        19.1%     74,334        18.2%     61,303        23.3%
Consumer .............      76,450        13.4%     53,400        13.1%     46,352        17.6%
                          --------       -----    --------       -----    --------       -----
Total allowance for
     loan losses .....    $569,245       100.0%   $408,878       100.0%   $263,215       100.0%
</TABLE>

       NONINTEREST INCOME AND EXPENSE

Noninterest Income

         Noninterest income increased to $293,482 for the year ended December
31, 2000, up 89.4% from $154,931 for the year ended December 31, 1999.
Noninterest income increased 13% in 1999 from $137,128 for the year ended
December 31, 1998. Service fees on deposit accounts, the largest component of
noninterest income, increased 67.2% to $264,154 in 2000 from $157,988 in 1999.
Service fee income in 1999 increased $29,929, or 23.4%, from $128,059 in 1998.
Other income increased 29.2% to $38,287 in 2000 from $29,645 in 1999, and
increased 77.8% from $21,536 in 1998. Both of these categories of noninterest
income increased due to the growth in the number of deposit accounts, as well as
increased fee-related activities of customers. The net loss on the sale of
investment securities decreased to $8,959 in 2000 from $32,702 in 1999 and
$12,467 in 1998. These losses primarily relate to paydowns on mortgage-backed
securities, as a result of movements in market interest rates since the
securities were acquired.

Noninterest Expense

         Total noninterest expense increased to $1.9 million for the period
ended December 31, 2000 from $1.6 million for the same period of 1999, and from
$1.3 million for the year ended December 31, 1998. The increase in noninterest
expense reflects an increase in most expense categories as a result of our
growth to $63.8 million in total assets at the end of 2000 from $46.2 million at
the end of 1999, up from $37.9 million for the year ended December 31, 1998.
Salary and wages expense totaled $890,572 in 2000, $725,470 in 1999, and
$566,706 in 1998. Employee benefits were $87,605 in 2000, $66,292 in 1999, and
$48,230 in 1998. We had 18 full-time equivalent employees at both the end of
2000 and the end of 1999. However, we began 1999 with 14 full-time equivalent
employees and the increase in expenses in 2000 is largely due to having a
constant staffing level throughout the year. Professional fees were $141,699 for
the year ended December 31, 2000, compared to $134,966 for 1999 and $148,487 for
1998. The 1999 and 1998 figures include costs associated with our year 2000
preparations. Professional fees include collection costs of $47,500 in 2000,
$35,000 in 1999, and $50,000 in 1998. Professional fees also include fees
related to discovery of a kiting operation by two of our customers, as noted
above. In 1998, we changed $100,000 to our allowance for loan losses because of
overdrafts in the accounts of these two customers. As part of a settlement with
these customers, in 1999 we took possession of property through a deed in lieu
of foreclosure to cover kiting losses. The estimated market value of the
property was $288,000. In 1999, we became involved in a lawsuit with another
bank that was also affected by the kiting. In 1999 and 2000 (until the sale of
the property), we wrote down the value of the property in the amounts of $50,000
and $11,426, respectively, to reflect projected losses relating to this lawsuit.
We charged these writedowns and additional expenses relating to this matter,
primarily legal fees and settlement expenses with the other bank, to operations
as other operating expenses.

                                       10
<PAGE>   11
         Depreciation and amortization decreased to $175,523 from $197,986 in
1999 and from $194,114 in 1998. We experienced an increase in other operating
expenses, to $319,101 in 2000, from $292,095 in 1999 and from $191,084 in 1998,
principally as a result of an increase in operating expenses related to the new
main office building, writedown to market value of real estate acquired in
settlement of loans, and other expenses associated with the expansion of loans
and deposits.

         Depreciation and amortization expense decreased by $8,281 from the
first quarter of 2000 to the same period of 2001. This decline was due to the
fact that equipment purchased when our bank opened in 1996 has now been fully
depreciated.

BALANCE SHEET REVIEW

Loans

         Loans are our largest category of earning assets and typically provide
higher yields than our other types of earning assets. At December 31, 2000,
loans represented 73.2% of earning assets, slightly lower than the 78.6% that
they represented at the end of 1999. At December 31, 2000, net loans (gross
loans less the allowance for loan losses) totaled $45.1 million, an increase of
$13 million or 40.5% from December 31, 1999. Average gross loans increased 44.4%
from $27.0 million with a yield of 9.13% in 1999, to $39.0 million with a yield
of 9.52% in 2000. Average gross loans increased from $15.8 million with a yield
of 9.17% in 1998. Associated with the higher loan yields are the inherent credit
and liquidity risks which we attempt to control and counterbalance. The interest
rates we charge on loans vary with the degree of risk and the maturity and
amount of the loan. Competitive pressures, money market rates, availability of
funds, and government regulations also influence interest rates.

         As we expected, the success of our third quarter 2000 marketing
campaign resulted in deposit growth that outpaced the seasonal demand for loans
in our market. Since our loan demand normally increases during the fall and
winter months, we expect to use these funds, which are currently invested in
short term instruments, to fund loan requests at higher rates.

         Mortgage loans constitute the principal component of our loan
portfolio. Mortgage loans represented 59.6% and 58.4% of our portfolio at year
end 2000 and 1999, respectively.

         In the context of this discussion, a "real estate mortgage loan" is
defined as any loan, other than loans for construction purposes, secured by real
estate, regardless of the purpose of the loan. Most of our real estate loans are
secured by residential or commercial property. We follow the common practice of
financial institutions in our area of obtaining a security interest in real
estate whenever possible, in addition to any other available collateral. This
collateral is taken to reinforce the likelihood of the ultimate repayment of the
loan and tends to increase the magnitude of the real estate loan portfolio
component. Generally, we limit our loan-to-value ratio to 80%. Due to the short
time our portfolio has existed, the current mix may not be indicative of the
ongoing portfolio mix. We attempt to maintain a relatively diversified loan
portfolio to help reduce the risk inherent in concentrations of collateral.

                                       11
<PAGE>   12
The following table shows the composition of our loan portfolio by category at
December 31, 2000 and 1999.


                          COMPOSITION OF LOAN PORTFOLIO

<TABLE>
<CAPTION>
                                       DECEMBER 31, 2000          DECEMBER 31, 1999
                                                   Percent                    Percent
                                     Amount        of Total     Amount        of Total
                                  ------------     --------  ------------     --------
<S>                               <C>              <C>       <C>              <C>
Commercial....................    $  8,719,474       19.1%   $  5,914,549        18.2%
Real estate - construction....       3,604,153        7.9%      3,357,946        10.3%
Real estate - mortgage........      27,171,980       59.6%     19,015,339        58.4%
Consumer......................       6,126,548       13.4%      4,250,158        13.1%
                                  ------------      -----    ------------       -----
Loans, gross..................      45,622,155      100.0%     32,537,992       100.0%
                                                    =====                       =====
Allowance for possible
losses........................        (569,245)                  (408,878)
                                  ------------               ------------
Loans, net....................    $ 45,052,910               $ 32,129,114
                                  ------------               ------------
</TABLE>

         The following tables set forth the maturity distribution, classified
according to sensitivity to changes in interest rates, for selected components
of our loan portfolio as of December 31, 2000 and 1999. The information in these
tables is based on the contractual maturities of the individual loans, including
loans which may be subject to renewal at their contractual maturity. Renewal of
these loans is subject to review and credit approval, as well as modification of
terms upon their maturity. Actual repayments of loans may differ from maturities
reflected above because borrowers may have the right to prepay obligations with
or without prepayment penalties.

                                       12
<PAGE>   13
       LOAN MATURITY SCHEDULE AND SENSITIVITY TO CHANGES IN INTEREST RATES


DECEMBER 31, 2000

<TABLE>
<CAPTION>
                                                 After one but
                           One year or less    within five years     After five years          Total
                           ----------------    -----------------     ----------------          -----
<S>                        <C>                  <C>                  <C>                  <C>
Commercial ..............  $      4,047,374     $      4,647,508     $        175,492     $      8,870,374
Real estate .............         4,163,710           21,239,518            2,809,942           28,213,170
Construction ............         1,782,689            1,560,780              107,919            3,451,388
Consumer ................         1,925,466            2,879,040              372,364            5,176,870
                           ----------------     ----------------     ----------------     ----------------
     Total ..............  $     11,919,239     $     30,326,846     $      3,465,717     $     45,711,802
                           ================     ================     ================     ================
Fixed Interest Rate .....  $      3,919,241     $     29,318,278     $      2,473,505     $     35,711,024
Variable Interest Rate ..         7,999,998            1,008,568              992,212           10,000,778
                           ----------------     ----------------     ----------------     ----------------
     Total ..............  $     11,919,239     $     30,326,846     $      3,465,717     $     45,711,802
                           ================     ================     ================     ================
</TABLE>



DECEMBER 31, 1999

<TABLE>
<CAPTION>
                                                 After one but
                           One year or less    within five years     After five years          Total
                           ----------------    -----------------     ----------------          -----
<S>                        <C>                 <C>                   <C>                  <C>
Commercial .............   $      2,205,560     $      3,248,547     $        161,852     $      5,615,959
Real estate ............          1,745,518           15,408,353            2,147,741           19,301,612
Construction ...........          2,575,349              819,343                   --            3,394,692
Consumer ...............          1,488,502            2,360,741              458,412            4,307,655
                           ----------------     ----------------     ----------------     ----------------
     Total .............   $      8,014,929     $     21,836,984     $      2,768,005     $     32,619,918
                           ================     ================     ================     ================
Fixed Interest Rate ....   $      3,115,593     $     21,152,842     $      2,455,129     $     26,723,564
Variable Interest Rate .          4,899,336              684,142              312,876            5,896,354
                           ----------------     ----------------     ----------------     ----------------
     Total .............   $      8,014,929     $     21,836,984     $      2,768,005     $     32,619,918
                           ================     ================     ================     ================
</TABLE>

     Investment Securities

         Investment securities at December 31, 1999 and December 31, 2000
averaged $9.7 million and $8.7 million, respectively. At December 31, 2000, our
total portfolio had a book value of $8.0 million, and a market value of $7.9
million, for an unrealized net loss of $62,802. This compares to our market
value at December 31, 1999 of $9.0 million, and at December 31, 1998 of $11.5
million.

         At December 31, 2000, short term investments totaled $6.9 million. At
December 31, 1999, we did not have any short-term investments. At December 31,
1998, short-term investments totaled $2.2 million. These funds are generally
invested in an earning capacity with maturities of six months to one year. We
primarily invest in U.S. Government Agency and mortgage backed securities.

         Contractual maturities and yields on our investment securities (all
available for sale) at December 31, 2000, 1999, and 1998 are set forth on the
following tables. Expected maturities may differ from contractual maturities
because issuers may have the right to call or prepay obligations with or without
call or prepayment penalties.

                                       13
<PAGE>   14
             INVESTMENT SECURITIES MATURITY DISTRIBUTION AND YIELDS
                                DECEMBER 31, 2000

<TABLE>
<CAPTION>
                             After five but
                            within ten years               After ten years
                            ----------------               ---------------
                          Amount         Yield          Amount          Yield
                       ----------     ----------      ----------     ----------
<S>                    <C>            <C>             <C>            <C>
U.S. Govt Agencies     $  662,903           7.30%     $       --             --%
Mortgage-backed                --             --%      7,299,032           6.29%
Other                          --             --%        286,900           6.75%
                       ----------     ----------      ----------     ----------
     Total             $  662,903           7.30%     $7,585,932           6.43%
                       ==========     ==========      ==========     ==========
</TABLE>

             INVESTMENT SECURITIES MATURITY DISTRIBUTION AND YIELDS
                                DECEMBER 31, 1999

<TABLE>
<CAPTION>
                             After five but
                            within ten years               After ten years
                            ----------------               ---------------
                          Amount         Yield          Amount          Yield
                       ----------     ----------      ----------     ----------
<S>                    <C>            <C>             <C>            <C>
U.S. Govt Agencies     $  462,585           7.00%     $       --             --%
Mortgage-backed                --             --%     8,837,430            6.31%
Other                          --             --%       303,050            6.61%
                       ----------     ----------      ----------     ----------
     Total             $  462,585           7.00%     $9,140,480           6.32%
                       ==========     ==========      ==========     ==========
</TABLE>


         INVESTMENT SECURITIES MATURITY DISTRIBUTION AND YIELDS
                           DECEMBER 31, 1998

<TABLE>
<CAPTION>
                             After five but
                            within ten years               After ten years
                            ----------------               ---------------
                          Amount         Yield          Amount          Yield
                       ----------     ----------      ----------     ----------
<S>                    <C>            <C>             <C>            <C>
U.S. Govt Agencies     $  101,063           7.08%     $       --             --%
Mortgage-backed                --             --%      9,465,584           5.92%
Other                          --             --%        190,850           6.00%
                       ----------     ----------      ----------     ----------
     Total             $  101,063           7.08%     $9,656,434           5.92%
                       ==========     ==========      ==========     ==========
</TABLE>

                                       14
<PAGE>   15
     Deposits and Other Interest-Bearing Liabilities

         Average total deposits were $48.4 million in 2000, up 44% from $33.6
million in 1999. Average interest-bearing deposits were $41.3 million in 2000,
up 47.5% from $28.0 million in 1999. These increases were primarily a result of
special promotions with higher rates.

         Core deposits, which exclude certificates of deposit of $100,000 or
more, provide a relatively stable funding source for our loan portfolio and
other earning assets. Our core deposits were $44.1 million at December 31, 2000,
an increase of 46.5% compared to $30.1 million at December 31, 1999. We expect a
stable base of deposits to continue to be our primary source of funding to meet
both our short-term and long-term liquidity needs. Core deposits as a percentage
of total deposits were approximately 78% at December 31, 2000 and 82% at
December 31, 1999. Our loan-to-deposit ratio was 80.4% at December 31, 2000
versus 88.3% at December 31, 1999. The average loan-to-deposit ratio was 80.9%
during 2000, 80.4% during 1999, and 61.5% during 1998.

         The following tables set forth our deposits by category as of December
31, 2000 and 1999.


<TABLE>
<CAPTION>
                                                                 DEPOSITS
                                           DECEMBER 31, 2000                DECEMBER 31, 1999
                                                       Percent of                       Percent of
                                         Amount         Deposits         Amount          Deposits
                                      -----------     -----------      -----------     -----------
<S>                                   <C>             <C>              <C>             <C>
Demand deposit accounts               $ 5,525,253             9.8%     $ 5,864,480            15.9%
NOW accounts                            2,148,148             3.8%       1,412,808             3.8%
Money market accounts                  12,085,652            21.3%       4,045,269            11.0%
Savings accounts                        3,133,648             5.5%       4,512,060            12.2%
Time deposits less than $100,000       21,181,849            37.3%      14,327,578            39.0%
Time deposits of $100,000 or over      12,651,961            22.3%       6,673,825            18.1%
                                      -----------     -----------      -----------     -----------
     Total deposits                   $56,726,511           100.0%     $36,836,020           100.0%
                                      ===========     ===========      ===========     ===========
</TABLE>



         As of December 31, 2000, time deposits less than $100,000 that matured
within three months were $3,797,628 and within 3-12 months were $10,854,194.
Time deposits less than $100,000 that had a maturity greater than 12 months were
$6,237,378 and after five years were $292,654. As of December 31, 2000, time
deposits greater than $100,000 that matured within three months were $6,017,908,
those within 3-6 months were $2,161,788 and those within 6-12 months were
$2,557,195. Time deposits greater than $100,000 that had a maturity greater than
12 months were $1,806,233 and after five years were $108,212.

CAPITAL

         We are subject to various regulatory capital requirements administered
by our federal bank regulators. As long as we have less than $150 million in
total assets, our capital levels are measured for regulatory purposes only at
the bank level, not at the holding company level. Under these capital
guidelines, we must maintain a minimum total risk-based capital ratio of 8%,
with at least 4% being Tier 1 capital. In our case, our Tier 1 capital consists
of our common shareholders' equity, although Tier 1 capital could also include
other components, such as qualifying perpetual preferred stock and minority
interests in equity accounts of consolidated subsidiaries. In addition, we must
maintain a minimum Tier 1 leverage ratio (Tier 1 capital to total average
assets) of at least 4%. To be considered "well-capitalized," we must maintain
total risk-based capital of at least 10%, Tier 1 capital of at least 6%, and a
leverage ratio of at least 5%.

                                       15
<PAGE>   16
         Our total shareholders' equity at December 31, 2000 was $6.7 million,
compared with $6.3 million in shareholders' equity in 1999. We were considered
to be "well capitalized" at the bank level for regulatory purposes at December
31, 2000, as our Tier 1 capital ratio was 12.6%, our total risk-based capital
ratio was 13.8%, and our Tier 1 leverage ratio was 9.4%.

LIQUIDITY MANAGEMENT

         Our primary sources of liquidity are deposits, scheduled repayments on
our loans, and interest on and maturities of our investments. All of our
securities have been classified as available for sale. Occasionally, we might
sell investment securities in connection with the management of our interest
sensitivity gap or to manage cash availability. We may also utilize our cash and
due from banks, security repurchase agreements, and federal funds sold to meet
liquidity requirements as needed. In addition, we have the ability, on a
short-term basis, to purchase federal funds from other financial institutions.
Presently, we have made arrangements with commercial banks for short-term
unsecured advances of up to $3 million. We also are eligible to receive advances
from the Federal Home Loan Bank of Atlanta, subject to its approval, and have
received and repaid such advances on two occasions in the past two fiscal years.
We believe that our liquidity and ability to manage assets will be sufficient to
meet our cash requirements over the near term.

         We are in the process of constructing a new branch facility of the bank
in the Surfside Beach area of the Grand Strand. Harrington Construction Company
is building the branch, which is expected to open in June of 2001. Funding for
the branch, estimated to cost $1.2 million, including furniture, fixtures and
equipment, will come from current deposits and the proceeds of this offering.

IMPACT OF INFLATION

         Unlike most industrial companies, the assets and liabilities of
financial institutions such as our company and bank are primarily monetary in
nature. Therefore, interest rates have a more significant impact on our
performance than do the effects of changes in the general rate of inflation and
changes in prices. In addition, interest rates do not necessarily move in the
same magnitude as the prices of goods and services. As discussed previously, we
seek to manage the relationships between interest sensitive assets and
liabilities in order to protect against wide rate fluctuations, including those
resulting from inflation.

                                       16
<PAGE>   17
PART 1. ITEM 7: FINANCIAL STATEMENTS



                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
                             (AUDITED AND UNAUDITED)




BEACH FIRST NATIONAL BANCSHARES, INC.

<TABLE>
<S>                                                                                                <C>
Report of Independent Auditor ................................................................                  F-2

Consolidated Balance Sheets at December 31, 2000 and 1999 ....................................                  F-3

Consolidated Statements of Operations for the Years Ended December 31, 2000, 1999 and 1998 ...                  F-4

Consolidated Statement of Changes in Shareholders' Equity for the Years Ended
     December 31, 2000, 1999 and 1998 ........................................................                  F-6

Consolidated Statements of Cash Flows for the Years Ended December 31, 2000, 1999, and 1998 ..                  F-7


Notes to Financial Statements ................................................................     F-7 through F-20
</TABLE>


                                      F-1
<PAGE>   18
               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS




Board of Directors
BEACH FIRST NATIONAL BANCSHARES, INC.
Myrtle Beach, South Carolina


           We have audited the accompanying consolidated balance sheets of BEACH
FIRST NATIONAL BANCSHARES, INC. (the "Company") AND SUBSIDIARY as of December
31, 2000 and 1999 and the related consolidated statements of operations, changes
in shareholders' equity and cash flows for each of the three years in the period
ended December 31, 2000. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

           We conducted our audits in accordance with auditing standards
generally accepted in the United States of America. Those standards require that
we plan and perform the audits to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated 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 consolidated financial
position of BEACH FIRST NATIONAL BANCSHARES, INC. AND SUBSIDIARY at December 31,
2000 and 1999 and the results of their operations and cash flows for each of the
three years in the period ended December 31, 2000, in conformity with accounting
principles generally accepted in the United States of America.





Elliott, Davis & Company, LLP
Greenville, South Carolina
January 19, 2001


                                      F-2
<PAGE>   19
              BEACH FIRST NATIONAL BANCSHARES, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                         DECEMBER 31,
                                                                                         ------------
                                                                                   2000              1999
                                                                                   ----              ----
<S>                                                                            <C>               <C>
                                     ASSETS

Cash and due from banks ....................................................   $  1,359,158      $  2,516,526
Federal funds sold and short term investments ..............................      6,919,000                --
Investment securities ......................................................      7,899,133         8,980,109
Loans, net .................................................................     45,052,910        32,129,114
Federal Reserve Bank stock .................................................        164,700           190,850
Federal Home Loan Bank stock ...............................................        122,200           112,200
Property and equipment, net ................................................      1,546,447         1,446,424
Real estate acquired in settlement of loans ................................             --            99,820
Other assets ...............................................................        706,468           680,352
                                                                               ------------      ------------
        Total assets .......................................................   $ 63,770,016      $ 46,155,395
                                                                               ============      ============

                      LIABILITIES AND SHAREHOLDERS' EQUITY

LIABILITIES
Deposits
     Noninterest bearing ...................................................   $  5,525,253      $  5,864,480
     Interest bearing ......................................................     51,201,258        30,971,540
                                                                               ------------      ------------
        Total deposits .....................................................     56,726,511        36,836,020

Other liabilities
     Federal Home Loan Bank advances .......................................             --         1,900,000
     Federal funds purchased ...............................................             --           920,000
     Other .................................................................        314,835           186,062
                                                                               ------------      ------------
        Total liabilities ..................................................     57,041,346        39,842,082

COMMITMENTS AND CONTINGENCIES - Notes 9 and 13

SHAREHOLDERS' EQUITY
     Common stock, $1 par value, 10,000,000 shares authorized, 737,368 and
     735,868 shares issued and outstanding at December 31, 2000 and 1999
     respectively ..........................................................        737,368           737,368
     Paid-in capital .......................................................      6,489,981         6,476,481
     Retained deficit ......................................................       (457,175)         (687,898)
     Accumulated other comprehensive loss ..................................        (41,504)         (211,138)
                                                                               ------------      ------------
        Total shareholders' equity .........................................      6,728,670         6,313,313
                                                                               ------------      ------------
        Total liabilities and shareholders' equity .........................   $ 63,770,016      $ 46,155,395
                                                                               ============      ============
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.


                                      F-3
<PAGE>   20
              BEACH FIRST NATIONAL BANCSHARES, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                               FOR THE YEARS ENDED DECEMBER 31,
                                                        ---------------------------------------------
                                                           2000             1999             1998
                                                        -----------      -----------      -----------
<S>                                                     <C>              <C>              <C>
INTEREST INCOME
     Loans and fees on loans ......................     $ 3,713,902      $ 2,469,213      $ 1,444,855
     Investment securities ........................         586,035          628,112          722,708
     Federal funds sold ...........................         334,086           43,459          133,807
                                                        -----------      -----------      -----------

         Total interest income ....................       4,634,023        3,140,784        2,301,370

INTEREST EXPENSE
     Deposits and borrowings ......................       2,450,184        1,458,633        1,153,927
                                                        -----------      -----------      -----------
         Net interest income ......................       2,183,839        1,682,151        1,147,443

PROVISION FOR POSSIBLE LOAN LOSSES ................         251,107          154,168          272,500
                                                        -----------      -----------      -----------
         Net interest income after provision
            for possible loan losses ..............       1,932,732        1,527,983          874,943
                                                        -----------      -----------      -----------

NONINTEREST INCOME
     Service fees on deposit accounts .............         264,154          157,988          128,059
     Loss on sale of investment securities ........          (8,959)         (32,702)         (12,467)
     Other income .................................          38,287           29,645           21,536
                                                        -----------      -----------      -----------
         Total noninterest income .................         293,482          154,931          137,128
                                                        -----------      -----------      -----------

NONINTEREST EXPENSES
     Salaries and wages ...........................         890,572          725,410          566,706
     Employee benefits ............................          87,605           66,292           48,230
     Supplies and printing ........................          51,222           36,595           52,265
     Advertising and public relations .............          34,598           23,126           30,855
     Professional fees ............................         141,699          134,466          148,487
     Depreciation and amortization ................         175,523          197,986          194,114
     Occupancy ....................................          53,485           49,268           37,565
     Data processing fees .........................          96,560           70,805           46,948
     Other operating expenses .....................         319,101          292,045          191,084
                                                        -----------      -----------      -----------
         Total noninterest expenses ...............       1,850,365        1,595,993        1,316,254
                                                        -----------      -----------      -----------

         Income (loss) before income taxes ........         375,849           86,921         (304,183)

INCOME TAX EXPENSE (BENEFIT) ......................         145,126           34,000          (71,000)
         Net income (loss) ........................     $   230,723      $    52,921      $  (233,183)
                                                        ===========      ===========      ===========

BASIC NET INCOME (LOSS) PER
     COMMON SHARE .................................     $      0.31      $      0.07      $     (0.32)
                                                        ===========      ===========      ===========

DILUTED NET INCOME (LOSS) PER
     COMMON SHARE .................................     $      0.28      $      0.06      $     (0.32)
                                                        ===========      ===========      ===========
</TABLE>

                                      F-4
<PAGE>   21
  The accompanying notes are an integral part of these consolidated financial
                                  statements.


                                      F-5
<PAGE>   22
              BEACH FIRST NATIONAL BANCSHARES, INC. AND SUBSIDIARY
           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
                                                                                                         ACCUMULATED
                                                             COMMON STOCK                                   OTHER         TOTAL
                                                          -----------------      PAID-IN     RETAINED   COMPREHENSIVE  SHAREHOLDERS'
                                                          SHARES     AMOUNT      CAPITAL     DEFICIT    INCOME (LOSS)     EQUITY
                                                          ------     ------      -------     -------    -------------     ------
<S>                                                      <C>       <C>         <C>          <C>         <C>            <C>
BALANCE, DECEMBER 31, 1997 ...........................   735,868   $ 735,868   $6,476,481   $(507,636)   $   5,822      $6,710,535
                                                                                                                        ----------
     Net loss ........................................                                       (233,183)                    (233,183)
     Other comprehensive loss, net of income taxes:
        Unrealized loss on investment securities .....                                                     (11,924)        (11,924)
        Less reclassification adjustments for
          losses included in net loss ................                                                       8,228           8,228
                                                                                                                        ----------
     Comprehensive loss ..............................                                                                    (236,879)
                                                         -------   ---------   ----------   ---------    ---------      ----------

BALANCE, DECEMBER 31, 1998 ...........................   735,868     735,868    6,476,481    (740,819)       2,126       6,473,656
                                                                                                                        ----------
     Net income ......................................                                         52,921                       52,921
     Other comprehensive loss, net of income taxes:
       Unrealized loss on investment securities ......                                                    (234,847)       (234,847)
       Less reclassification adjustments for losses
         included in net income ......................                                                      21,583          21,583
                                                                                                                        ----------
     Comprehensive loss ..............................                                                                    (160,343)
                                                         -------   ---------   ----------   ---------    ---------      ----------

BALANCE, DECEMBER 31, 1999 ...........................   735,868     735,868    6,476,481    (687,898)    (211,138)      6,313,313
                                                                                                                        ----------
     Net income ......................................                                        230,723                      230,723
     Other comprehensive income, net of income taxes:
       Unrealized gain on investment securities ......                                                     163,721         163,721
       Plus reclassification adjustments for losses
         included in net income ......................                                                       5,913           5,913
                                                                                                                        ----------
     Comprehensive income ............................                                                                     400,357
     Exercise of stock options .......................     1,500       1,500       13,500                                   15,000
                                                         -------   ---------   ----------   ---------    ---------      ----------
BALANCE, DECEMBER 31, 2000 ...........................   737,368   $ 737,368   $6,489,981   $(457,175)   $ (41,504)     $6,728,670
                                                         =======   =========   ==========   =========    =========      ==========
</TABLE>

                                      F-6
<PAGE>   23
  The accompanying notes are an integral part of these consolidated financial
                                   statements

                                      F-7
<PAGE>   24
              BEACH FIRST NATIONAL BANCSHARES, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                             FOR THE YEARS ENDED DECEMBER 31,
                                                                            2000           1999           1998
                                                                            ----           ----           ----
OPERATING ACTIVITIES
<S>                                                                   <C>            <C>            <C>
      Net income (loss) ............................................  $    230,723   $     52,921   $   (233,183)
      Adjustments to reconcile net income (loss) to net
      cash provided by operating activities
           Depreciation and amortization ...........................       175,523        197,986        194,114
           Deferred income taxes ...................................       129,286         31,000        (71,000)
           Provision for loan losses ...............................       251,107        154,168        272,500
           Write down on real estate acquired in settlement of
              loans.................................................        11,426         50,000           --
           Loss on sale of investment securities ...................         8,959         32,702         12,467
           Increase in other assets ................................      (176,699)      (203,788)      (120,152)
           Increase in other liabilities ...........................       128,771        120,172         22,012
                                                                       ------------   ------------   -----------

               Net cash provided by operating activities ...........       759,096        435,161         76,758
                                                                       ------------   ------------   -----------

INVESTING ACTIVITIES
               Proceeds from sale of investment securities .........     1,548,201      4,678,226     10,576,918
               Purchase of investment securities ...................      (209,313)    (2,790,691)   (11,235,042)
               Decrease (increase) in Federal funds sold ...........    (6,919,000)     2,250,000     (1,040,000)
           Increase in loans, net ..................................   (13,174,903)   (11,450,941)    (9,986,237)
           Purchase of premises and equipment ......................      (271,024)       (96,556)       (24,213)
           Proceeds from disposal of premises and equipment ........        24,085           --             --
                                                                       ------------   ------------   -----------

                   Net cash used by investing activities ...........   (19,001,954)    (7,409,962)   (11,708,574)
                                                                       ------------   ------------   -----------

FINANCING ACTIVITIES
           Proceeds (repayments) of Federal Home Loan Bank
           advances ................................................    (1,900,000)     1,900,000         --
           Increase (decrease) in Federal funds purchased ..........      (920,000)       920,000         --
           Net increase in deposits ................................    19,890,490      5,700,978     11,063,121
           Exercise of stock options ...............................        15,000           --           --
                                                                       ------------   ------------   -----------

           Net cash provided by financing activities ...............    17,085,490      8,520,978     11,063,121
                                                                       ------------   ------------   -----------
           Net increase (decrease) in cash .........................    (1,157,368)     1,546,177       (568,695)

CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR .....................     2,516,526        970,349      1,539,044
                                                                       ------------   ------------   -----------

CASH AND EQUIVALENTS AT END OF YEAR ................................  $  1,359,158   $  2,516,526   $    970,349
                                                                       ============   ============   ===========

CASH PAID FOR
     Interest ......................................................  $  2,378,832   $  1,447,576   $  1,147,103
                                                                       ============   ============   ===========
     Income taxes ..................................................  $      1,910   $      1,000   $       --
                                                                       ============   ============   ===========

SCHEDULE OF NONCASH INVESTING ACTIVITY
    Real estate acquired in settlement of loan .....................  $       --     $    288,074   $       --
                                                                       ============   ============   ===========
</TABLE>

    The accompanying notes are an integral part of these financial statements

              BEACH FIRST NATIONAL BANCSHARES, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                      F-8
<PAGE>   25
                                      F-9
<PAGE>   26
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ACTIVITIES

      BEACH FIRST NATIONAL BANCSHARES, INC. (the "Company") is organized under
the laws of the State of South Carolina for the purpose of operating as a bank
holding company for Beach First National Bank (the "Bank"). The Bank provides
full commercial banking services to customers and is subject to regulation by
the Office of the Comptroller of the Currency (OCC) and the Federal Deposit
Insurance Corporation. The Company is subject to regulation by the Federal
Reserve Board.

BASIS OF PRESENTATION

      The consolidated financial statements include the accounts of the Company
and the Bank. All significant intercompany accounts and transactions have been
eliminated in consolidation. The accounting and reporting policies of the
Company conform to generally accepted accounting principles and to general
practices in the banking industry. The Company uses the accrual basis of
accounting.

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 as of the date of the
consolidated financial statements and the reported amount of income and expenses
during the reporting periods. Actual results could differ from those estimates.

CONCENTRATIONS OF CREDIT RISK

      The Company, through its subsidiary, makes loans to individuals and
businesses in and around Horry County for various personal and commercial
purposes. The Company has a diversified loan portfolio and the borrowers'
ability to repay their loans is not dependent upon any specific economic sector.

CASH AND CASH EQUIVALENTS

      For purposes of the statement of cash flows, cash and cash equivalents are
defined as those amounts included in the balance sheet caption "Cash and due
from banks". Cash and cash equivalents have an original maturity of three months
or less.

INVESTMENT SECURITIES

      The Company accounts for investment securities in accordance with
Statement of Financial Accounting Standards (SFAS) No. 115, "Accounting for
Certain Investments in Debt and Equity Securities". The statement requires
investments in equity and debt securities to be classified into three
categories:

1.         Available for sale: These are securities which are not classified as
           either held to maturity or as trading securities. These securities
           are reported at fair market value. Unrealized gains and losses are
           reported, net of income taxes, as separate components of
           shareholders' equity (accumulated other comprehensive loss).

2.         Held to maturity: These are investment securities which the Company
           has the ability and intent to hold until maturity. These securities
           are stated at cost, adjusted for amortization of premiums and the
           accretion of discounts. The Company has no held to maturity
           securities.

3.         Trading: These are securities which are bought and held principally
           for the purpose of selling in the near future. Trading securities are
           reported at fair market value, and related unrealized gains and
           losses are recognized in the statement of operations. The Company has
           no trading securities

                                      F-10
<PAGE>   27
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES AND ACTIVITIES, CONTINUED

LOANS, INTEREST AND FEE INCOME ON LOANS

      Loans are stated at the principal balance outstanding. Unearned discount,
unamortized loan fees and the allowance for possible loan losses are deducted
from total loans in the balance sheet. Interest income is recognized over the
term of the loan based on the principal amount outstanding. Points on real
estate loans are taken into income to the extent they represent the direct cost
of initiating a loan. The amount in excess of direct costs is deferred and
amortized over the expected life of the loan.

      Loans are generally placed on non-accrual status when principal or
interest becomes ninety days past due, or when payment in full is not
anticipated. When a loan is placed on non-accrual status, interest accrued but
not received is generally reversed against interest income. If collectibility is
in doubt, cash receipts on non-accrual loans are not recorded as interest
income, but are used to reduce principal.

ALLOWANCE FOR POSSIBLE LOAN LOSSES

      The provision for possible loan losses charged to operating expenses
reflects the amount deemed appropriate by management to establish an adequate
allowance to meet the present and foreseeable risk characteristics of the
current loan portfolio. Management's judgement is based on periodic and regular
evaluation of individual loans, the overall risk characteristics of the various
portfolio segments, past experience with losses and prevailing and anticipated
economic conditions. Loans which are determined to be uncollectible are charged
against the allowance. Provisions for loan losses and recoveries on loans
previously charged off are added to the allowance. Management considers the
year-end allowance appropriate and adequate to cover possible losses in the loan
portfolio; however, management's judgement is based upon a number of assumptions
about future events, which are believed to be reasonable, but which may or may
not prove valid. Thus, there can be no assurance that charge-offs in future
periods will not exceed the allowance for loan losses or that additional
increases in the allowance for loan losses will not be required.

      The Company accounts for impaired loans in accordance with SFAS No. 114,
"Accounting by Creditors for Impairment of a Loan". This standard requires that
all lenders value loans at the loan's fair value if it is probable that the
lender will be unable to collect all amounts due according to the terms of the
loan agreement. Fair value may be determined based upon the present value of
expected cash flows, market price of the loan, if available, or value of the
underlying collateral. Expected cash flows are required to be discounted at the
loan's effective interest rate. SFAS No. 114 was amended by SFAS No. 118 to
allow a lender to use existing methods for recognizing interest income on an
impaired loan and by requiring additional disclosures about how a creditor
recognizes interest income on an impaired loan.

      Under SFAS No. 114, as amended by SFAS No. 118, when the ultimate
collectibility of an impaired loan's principal is in doubt, wholly or partially,
all cash receipts are applied to principal. When this doubt does not exist, cash
receipts are applied under the contractual terms of the loan agreement first to
principal then to interest income. Once the reported principal balance has been
reduced to zero, future cash receipts are applied to interest income, to the
extent that any interest has been foregone. Further cash receipts are recorded
as recoveries of any amounts previously charged off.

      A loan is also considered impaired if its terms are modified in a troubled
debt restructuring. For these accruing impaired loans, cash receipts are
typically applied to principal and interest receivable in accordance with the
terms of the restructured loan agreement. Interest income is recognized on these
loans using the accrual method of accounting. As of December 31, 2000 and 1999,
the Company had no impaired loans.

                                      F-11
<PAGE>   28
REAL ESTATE ACQUIRED IN SETTLEMENT OF LOANS

      Real estate acquired through foreclosure is initially recorded at the
lower of cost or estimated fair value. Subsequent to the date of acquisition, it
is carried at the lower of cost or fair value, adjusted for net selling costs.
Fair values of real estate owned are reviewed regularly and writedowns are
recorded when it is determined that the carrying value of real estate exceeds
the fair value less estimated costs to sell. Costs relating to the development
and improvement of such property are capitalized, whereas those costs relating
to holding the property are charged to expense.

PROPERTY AND EQUIPMENT

      Furniture and equipment are stated at cost, net of accumulated
depreciation. Depreciation is computed using the straight-line method over the
estimated useful lives of the related assets. Maintenance and repairs are
charged to operations, while major improvements are capitalized. Upon
retirement, sale or other disposition of property and equipment, the cost and
accumulated depreciation are eliminated from the accounts, and gain or loss is
included in income from operations.

INCOME TAXES

      The consolidated financial statements have been prepared on the accrual
basis. When income and expenses are recognized in different periods for
financial reporting purposes and for purposes of computing income taxes
currently payable, deferred taxes are provided on such temporary differences.
The Company accounts for income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes". Under SFAS 109, deferred tax assets and
liabilities are recognized for the expected future tax consequences of events
that have been recognized in the consolidated financial statements or tax
return. Deferred tax assets and liabilities are measured using the enacted tax
rates expected to apply to taxable income in the years in which those temporary
differences are expected to be realized or settled.

ADVERTISING AND PUBLIC RELATIONS EXPENSE

      Advertising, promotional and other business development costs are
generally expensed as incurred. External costs incurred in producing media
advertising are expensed the first time the advertising takes place. External
costs relating to direct mailing costs are expensed in the period in which the
direct mailings are sent.

RECLASSIFICATIONS

      Certain previously reported amounts have been reclassified to conform to
the current year presentation. Such changes had no effect on previously reported
net loss or shareholders' equity.

RECENTLY ISSUED ACCOUNTING STANDARDS

      In June 1998, the Financial Accounting Standards Board (FASB) issued SFAS
No. 133, "Accounting for Derivative Instruments and Hedging Activities." All
derivatives are to be measured at fair market value and recognized in the
balance sheet as assets and liabilities. SFAS No. 138, "Accounting for Certain
Derivative Instruments and Certain Hedging Activities" was issued in June 2000
and amends the accounting and reporting standards of SFAS No. 133 for certain
derivative instruments and hedging activities. The two statements are to be
adopted concurrently and are effective for fiscal years and quarters beginning
after June 15, 2000. The Company does not expect that the adoption of SFAS No.
133 and SFAS No. 138 will have a material impact on the presentation of the
Company's financial results or financial position.

      Other accounting standards that have been issued or proposed by the
Financial Accounting Standards Board that do not require adoption until a future
date are not expected to have a material impact on the consolidated financial
statements upon adoption.

                                      F-12
<PAGE>   29
NOTE 2 - RESTRICTIONS ON CASH AND DUE FROM BANKS

      The Bank is required to maintain average reserve balances, computed by
applying prescribed percentages to its various types of deposits, either at the
bank or on deposit with the Federal Reserve Bank. At December 31, 2000 and 1999
these required reserves were met by vault cash.

NOTE 3 - INVESTMENT SECURITIES

             The amortized costs and fair value of investment securities are as
follows:

<TABLE>
<CAPTION>
                                          DECEMBER 31, 2000
                                          -----------------
                                         GROSS UNREALIZED
                                         ----------------
                        AMORTIZED COST   GAINS     LOSSES     FAIR VALUE
                        --------------   -----     ------     ----------

<S>                      <C>           <C>        <C>        <C>
Federal agencies ......    $  662,903    $ 6,507    $   150    $  669,260
Mortgage-backed .......     7,299,032     11,866     81,025     7,229,873
                           ----------    -------    -------    ----------

     Total securities..    $7,961,935    $18,373    $81,175    $7,899,133
                           ==========    =======    =======    ==========
</TABLE>


<TABLE>
<CAPTION>
                                        DECEMBER 31, 1999
                                        -----------------

<S>                      <C>           <C>          <C>         <C>
Federal agencies ......    $  462,585    $    --      $ 10,528    $  452,057
Mortgage-backed .......     8,837,430         --       309,378     8,528,052
                           ----------    ---------    --------    ----------

     Total securities..    $9,300,015    $    --      $319,906    $8,980,109
                           ==========    =========    ========    ==========
</TABLE>

           The amortized costs and fair values of investment securities at
December 31, 2000, by contractual maturity, are shown in the following chart.
Expected maturities may differ from contractual maturities because borrowers may
have the right to call or prepay obligations with or without call or prepayment
penalties.


<TABLE>
<CAPTION>
                                    AMORTIZED COST  FAIR VALUE
                                    --------------  ----------
<S>                                 <C>             <C>
Due after five through ten years ..    $  662,903    $  669,261
Due after ten years ...............     7,299,032     7,229,872
                                       ----------    ----------

     Total investment securities..     $7,961,935    $7,899,133
                                       ==========    ==========
</TABLE>

           During 2000, 1999 and 1998 gross proceeds from the sale of investment
securities were $1,548,201, $4,678,226, and $10,576,918, respectively. Net
losses from the sale of investment securities in 2000, 1999 and 1998 were
$8,959, $32,702 and $12,467, respectively. As of December 31, 2000 there were
$4,199,635 of securities pledged as collateral for public funds and other
purposes. At December 31, 1999 there were no securities pledged as collateral
for public funds.

                                      F-13
<PAGE>   30
NOTE 4 - LOANS

           The composition of net loans by major loan category is presented
below:
<TABLE>
<CAPTION>
                                                   DECEMBER 31,
                                          ------------------------------
                                               2000               1999
                                          ---------------    -----------
<S>                                       <C>               <C>
Commercial ..............................    $  8,719,474     $  5,914,549
Real estate - construction ..............       3,604,153        3,357,946
Real estate - mortgage ..................      27,171,980       19,015,339
Consumer ................................       6,126,548        4,250,158
                                             ------------     ------------

Loans, gross ............................      45,622,155       32,537,992
Less allowance for possible loan losses..        (569,245)        (408,878)
                                             ------------     ------------

Loans, net ..............................    $ 45,052,910     $ 32,129,114
                                             ============     ============
</TABLE>

           At December 31, 2000 nonaccruing loans were $104,815. At December 31,
1999 there were no nonaccruing loans.

NOTE 5 - ALLOWANCE FOR POSSIBLE LOAN LOSSES

           The allowance for possible loan losses is available to absorb future
loan charge-offs. The allowance is increased by provisions charged to operating
expenses and by recoveries of loans which were previously written-off. The
allowance is decreased by the aggregate loan balances, if any, which were deemed
uncollectible during the year.

           Activity within the allowance for possible loan losses account
follows:

<TABLE>
<CAPTION>
                                                                        FOR THE YEARS ENDED
                                                                            DECEMBER 31,
                                                                --------------------------------------
                                                                   2000          1999          1998
                                                                -----------   -----------   ----------
<S>                                                             <C>           <C>           <C>
Balance, beginning of year .................................    $ 408,878     $ 263,215     $ 169,502
Recoveries of loans previously charged against the
     allowance ................................................      --            --           1,499
Provision for loan losses ..................................      251,107       154,168       272,500
Loans charged against the allowance ........................      (90,740)       (8,505)     (180,286)
                                                                ---------     ---------     ---------
Balance, end of year .......................................    $ 569,245     $ 408,878     $ 263,215
                                                                =========     =========     =========
</TABLE>

                                      F-14
<PAGE>   31
NOTE 6 - PROPERTY AND EQUIPMENT

           Property and equipment are stated at cost less accumulated
depreciation. Components of property and equipment included in the consolidated
balance sheets are as follows:

<TABLE>
<CAPTION>
                                                DECEMBER 31,
                                       --------------------------
                                           2000            1999
                                       ------------    ----------
<S>                                   <C>             <C>
Land .............................    $   218,608     $   218,608
Buildings and improvements .......        996,724         994,339
Furniture and equipment ..........        672,940         587,142
Software .........................        173,406         104,819
Construction in progress .........        112,156          23,700
                                      -----------     -----------
                                        2,173,834       1,928,608
Accumulated depreciation .........       (627,387)       (482,184)
                                      -----------     -----------

    Total property and equipment..    $ 1,546,447     $ 1,446,424
                                      ===========     ===========
</TABLE>

           Depreciation expense for the years ended December 31, 2000, 1999 and
1998 amounted to $146,918, $180,136, and $176,524, respectively. Depreciation is
charged to operations over the estimated useful lives of the assets. The
estimated useful lives and methods of depreciation for the principal items
follow:

<TABLE>
<CAPTION>
           TYPE OF ASSET                                  LIFE IN YEARS                           DEPRECIATION METHOD
------------------------------------                      -------------                           -------------------
<S>                                                       <C>                                     <C>
Software                                                      3                                     Straight-line
Furniture and equipment                                       5 to 7                                Straight-line
Buildings and improvements                                    5 to 40                               Straight-line
</TABLE>

NOTE 7 - REAL ESTATE ACQUIRED IN SETTLEMENT OF LOANS

           During January of 1998, the Bank discovered a kiting operation
involving two customers' accounts. In 1998, $100,000 of overdrafts on these two
customers accounts were charged to the allowance for loan losses. In 1999, as
part of recovering amounts at risk from the fraud, a deed was taken in lieu of
foreclosure on a single family residence. The residence was sold in 2000. During
2000 and 1999, $58,927 and $61,192, respectively, of amounts previously thought
to be recoverable from the sale of the real estate and included were charged to
operations as writedowns to real estate and included in other operating
expenses. Management believes all related losses due to the fraud have been
recorded and no additional losses will be incurred.

NOTE 8 - DEPOSITS

           The following is a detail of the deposit accounts:

<TABLE>
<CAPTION>
                                           DECEMBER 31,
                                  --------------------------
                                      2000           1999
                                  -----------    -----------
<S>                               <C>            <C>
Non-interest bearing ............    $ 5,525,253    $ 5,864,480
Interest bearing:
      NOW accounts ..............      2,148,148      1,412,808
      Money market accounts .....     12,085,652      4,045,269
      Savings ...................      3,133,648      4,512,060
      Time, less than $100,000 ..     21,181,849     14,327,578
      Time, $100,000 and over ...     12,651,961      6,673,825
                                     -----------    -----------

Total deposits ..................    $56,726,511    $36,836,020
                                     ===========    ===========
</TABLE>

                                      F-15
<PAGE>   32
NOTE 8 - DEPOSITS, CONTINUED

           Interest expense on time deposits greater than $100,000 was $647,924
in 2000, $312,030 in 1999, and $260,466 in 1998.

           At December 31, 2000 the scheduled maturities of certificates of
deposit are as follows:

<TABLE>
<CAPTION>
<S>                                   <C>                              <C>
                                      2001.......................        $     25,388,710
                                      2002.......................               6,707,115
                                      2003.......................               1,337,120
                                      2004.......................                 400,865
                                                                         ----------------
                                                                         $     33,833,810
                                                                         ================
</TABLE>


NOTE 9 - COMMITMENTS AND CONTINGENCIES

           The Company is party to litigation and claims arising in the normal
course of business. Management, after consultation with legal counsel, believes
that the liabilities, arising from such litigation and claims either have been
properly accrued for or will not be material to shareholders' equity or the net
income from operations.

           The Company has entered into a construction contract to build a
branch office. Total estimated cost of the branch is $1,200,000. Amounts
incurred under the contract are included in construction in progress as part of
property and equipment. The branch is expected to be completed in June 2001.

           Refer to Note 13 concerning financial instruments with off balance
sheet risk.


NOTE 10 - LINES OF CREDIT

           At December 31, 2000, the Bank had $3,000,000 of lines of credit to
purchase federal funds from unrelated banks. These lines of credit are available
on a one to seven day basis for general corporate purposes of the Bank. All of
the lenders have reserved the right to withdraw these lines at their option.

                                      F-16
<PAGE>   33
NOTE 11 - INCOME TAXES
           The following summary of the provision for income taxes includes tax
deferrals which arise from temporary differences in the recognition of certain
items of revenue and expense for tax and financial reporting purposes for the
years ended December 31,:

<TABLE>
<CAPTION>
                                              2000        1999       1998
                                            ---------   ---------   --------
<S>                                         <C>         <C>          <C>
Income taxes currently payable
      Federal ..........................    $   --      $   --       $   --
      State ............................      15,840       1,890         --
                                            --------    --------     --------

                                              15,840       1,890         --
                                            --------    --------     --------
Tax consequences of differences
      Depreciation .....................       4,470      24,680         --
      Net operating loss ...............     124,816       7,430      (71,000)
                                            --------    --------     --------

                                             129,286      32,110      (71,000)
                                            --------    --------     --------

                     Provision (benefit)    $145,126    $ 34,000     $(71,000)
                                            ========    ========     ========
</TABLE>

           The income tax effect of cumulative temporary differences at December
31, are as follows:
<TABLE>
<CAPTION>
                                              DEFERRED TAX ASSET (LIABILITY)
                                              ------------------------------
                                                  2000           1999
                                               ----------    ---------
<S>                                            <C>           <C>
Allowance for loan losses .................    $ 198,475     $ 139,000
Net operating loss carry forward ..........         --         163,000
Unrealized loss on investment securities ..       22,661       108,770
Depreciation ..............................      (29,150)      (24,680)
                                               ---------     ---------
                                                 191,986       386,090
           Less valuation allowance .......     (112,279)     (102,772)
                                               ---------     ---------

                     Net deferred tax asset    $  79,707     $ 283,318
                                               =========     =========
</TABLE>

           The net deferred tax asset is reported in other assets in the balance
sheets at December 31, 2000 and 1999. Due to cumulative losses incurred since
inception, management has included a deferred tax asset valuation allowance of
$112,279. The recognition of a net deferred tax asset is dependent upon a "more
likely than not" expectation of the realization of the deferred tax asset, based
upon the analysis of the available evidence. A valuation allowance is required
to sufficiently reduce the deferred tax asset to the amount that is expected to
be realized through future realization of profits on a "more likely than not"
basis. The analysis of available evidence is performed on an ongoing basis
utilizing the "more likely than not" criteria to determine the amount, if any,
of the deferred tax asset to be realized. Adjustments to the valuation allowance
are made accordingly. There can be no assurance that the Company will recognize
additional portions of the deferred tax asset in future periods or that
additional valuation allowances may not be recorded in the future periods.

                                      F-17
<PAGE>   34
NOTE 11 - INCOME TAXES, CONTINUED

           The provision for income taxes is reconciled to the amount of income
tax computed at the federal statutory rate on income before income taxes for the
years ended December 31, as follows:

<TABLE>
<CAPTION>
                                                      2000           1999                 1998
                                              AMOUNT      %     AMOUNT     %       AMOUNT        %
                                              ------      -     ------     -       ------        -
<S>                                          <C>         <C>    <C>        <C>    <C>           <C>
Tax expense (benefit) at statutory rate .    $127,790    34%    $29,550    34%    $(103,420)    (34)%
Increase (decrease) in taxes
  Resulting from:
  State bank tax (net of federal benefit)      10,455     3%      1,250     1%         --       --
  Valuation allowance ...................       6,881     2%      3,200     4%       32,420      11%
                                             --------    --     -------    --     ---------     ---
  Tax provision (benefit) ...............    $145,126    39%    $34,000    39%    $ (71,000)    (23%)
                                             ========    ==     =======    ==     =========     ===
</TABLE>

NOTE 12 - RELATED PARTY TRANSACTIONS

           Certain directors, executive officers and companies with which they
are affiliated, are customers of and have banking transactions with the Bank in
the ordinary course of business. These loans were made on substantially the same
terms, including interest rates and collateral, as those prevailing at the time
for comparable arms-length transactions.

           A summary of loan transactions with directors, including their
affiliates, and executive officers follows:

<TABLE>
<CAPTION>
                                        FOR THE YEARS ENDED
                                            DECEMBER 31,
                               -------------------------------------
                                  2000          1999         1998
                               ----------    ---------    ----------
<S>                           <C>           <C>           <C>
Balance, beginning of year    $3,936,854    $2,505,386    $2,662,407
New loans ................     2,757,853     3,315,398     1,552,088
Less loan payments .......     1,858,979     1,883,930     1,709,109
                              ----------    ----------    ----------

Balance, end of year .....    $4,835,728    $3,936,854    $2,505,386
                              ==========    ==========    ==========
</TABLE>

           Deposits by directors and their related interests, at December 31,
2000 and 1999, approximated $4,924,000 and $5,450,000, respectively.

           One of the directors of the Bank was awarded the contract to
construct a branch office (see note 9).

NOTE 13 - FINANCIAL INSTRUMENTS WITH OFF BALANCE SHEET RISK

           In the ordinary course of business, and to meet the financing needs
of its customers, the Company is a party to various financial instruments with
off balance sheet risk. These financial instruments, which include commitments
to extend credit and standby letters of credit, involve, to varying degrees,
elements of credit and interest rate risk in excess of the amounts recognized in
the balance sheets. The contract amount of those instruments reflects the extent
of involvement the Company has in particular classes of financial instruments.

           The Company's exposure to credit loss in the event of nonperformance
by the other party to the financial instrument for commitments to extend credit
and standby letters of credit is represented by the contractual amounts of those
instruments. The Company uses the same credit policies in making commitments and
conditional obligations as it does for on balance sheet instruments.

                                     F-18
<PAGE>   35
NOTE 13 - FINANCIAL INSTRUMENTS WITH OFF BALANCE SHEET RISK, CONTINUED

           Commitments to extend credit are agreements to lend to a customer as
long as there is no violation of any material condition established in the
contract. Commitments generally have fixed expiration dates or other termination
clauses and may require the payment of a fee. At December 31, 2000, unfunded
commitments to extend credit were $6,225,000, of which $3,000,000 is at fixed
rates and $3,225,000 is at variable rates. The Company evaluates each customer's
credit worthiness on a case-by-case basis. The amount of collateral obtained, if
deemed necessary by the Company upon extension of credit, is based on
management's credit evaluation of the borrower. Collateral varies but may
include accounts receivable, inventory, property, plant and equipment,
commercial and residential real estate.

           At December 31, 2000, there was a $840,999 commitment under a letter
of credit. The credit risk involved in issuing letters of credit is essentially
the same as that involved in extending loan facilities to customers. Collateral
varies but may include accounts receivable, inventory, equipment, marketable
securities and property. Since most of the letters of credit are expected to
expire without being drawn upon, they do not necessarily represent future cash
requirements.


NOTE 14 - EMPLOYEE BENEFIT PLAN

           The Company sponsors the Beach First National Bank Profit Sharing and
401(k) Plan for the benefit of all eligible employees. The Company contributes
to the Plan annually upon approval by the Board of Directors. Contributions made
to the Plan in 2000, 1999 and 1998 amounted to $18,416, $11,854 and $10,398,
respectively.


NOTE 15 - STOCK OPTION PLANS

           The Company sponsors a stock option plan for the benefit of the
directors, officers and employees. The Board may grant up to 110,000 incentive
stock options at an option price per share not less than the fair market value
on the date of grant. The directors were granted 1,500 options each that vested
immediately. All other options granted to officers and employees vest either
over two or five years and expire 10 years from the grant date.

           During 2000, the Company extended the expiration of 22,077 stock
options to a former officer. Under the terms of the extension, these options
became nonqualified options with an exercise price of $10.00 per share and
expiration date of January 15, 2002. No compensation expense was charged to
operations as the exercise price was equal to the fair market value of the stock
on the date of the extension.

           The Company has adopted the disclosure-only provisions of SFAS No.
123, "Accounting for Stock-Based Compensation". Accordingly, no compensation
cost has been recognized for the stock option plan. Had compensation cost been
determined based on the fair value at the grant date for the above stock option
awards


                                      F-19
<PAGE>   36
NOTE 15 - STOCK OPTION PLANS, CONTINUED

consistent with the provisions of SFAS No. 123, the Company's net income (loss)
and net income (loss) per common share would have changed to the pro forma
amounts indicated below:

<TABLE>
<CAPTION>
                                                           FOR THE YEARS ENDED
                                                               DECEMBER 31,
                                                  2000            1999           1998
                                               -----------    ------------   -----------
<S>                                              <C>            <C>           <C>
Net income (loss)
           As reported ...................       $230,723       $52,921       $(233,183)
           Pro forma .....................        193,968        (1,451)       (286,381)
Basic net income (loss) per common share
           As reported ...................            .31           .07            (.32)
           Pro forma .....................            .26           .00            (.39)
Diluted net income (loss) per common share
           As reported ...................            .28           .06            (.32)
           Pro forma .....................            .24           .00            (.39)
</TABLE>

           The fair value of the option grant is estimated on the date of grant
using the Black-Scholes option pricing model. The risk free interest rate used
was 5.89 percent, the expected option life was 5 years, the assumed dividend
rate was zero, and the assumed volatility was 10%.

           A summary of the status of the plan as of December 31, 2000, 1999 and
1998 and changes during the years ending on those dates is presented below:

<TABLE>
<CAPTION>
                                             2000                                 1999                             1998
                                   -----------------------------     ------------------------------    ----------------------------
                                                   WEIGHTED                           WEIGHTED                           WEIGHTED
                                                    AVERAGE                            AVERAGE                           AVERAGE
                                   SHARES        EXERCISE PRICE       SHARES        EXERCISE PRICE      SHARES       EXERCISE PRICE
                                   ------        --------------       ------        --------------      ------       --------------
<S>                                 <C>          <C>                  <C>           <C>                <C>           <C>
Outstanding at beginning
 of year......................      104,978          $10.08           103,978         $10.07           101,048            $10.00
Granted.......................        5,000           12.50             1,000          12.00             4,585             11.76
Exercised.....................       (1,500)          10.00                --             --               --               --
Forfeited or expired..........      (19,616)          10.00                --             --                               10.48
                                    --------         -------          --------                         ---------
                                                                                                        (1,655)
                                                                                                       ---------

Outstanding at end
 of year......................       88,862           10.24           104,978          10.08             103,978           10.07
                                  =========                         ==========                         ==========

Options exercisable at
 year-end.....................       55,014           10.03            69,714          10.02              53,118           10.03
                                  =========                         ==========                         ==========

Shares available
 for grant....................       19,638            --               5,022              --              6,022            --
                                  =========                         ==========                         ==========
</TABLE>


NOTE 16 - DIVIDENDS

           There are no current plans to initiate payment of cash dividends and
future dividend policy will depend on the Bank's and the Company's earnings,
capital requirements, financial condition and other factors considered relevant
by the Company's Board of Directors. The Bank is restricted in its ability to
pay dividends under the national banking laws and regulations of the OCC.
Generally, these restrictions require the Bank to pay dividends derived solely
from net profits. Moreover, OCC prior approval is required if dividends declared
in any calendar year exceed the Bank's net profit for that year combined with
its retained net profits for the preceding two years.

                                      F-20
<PAGE>   37
NOTE 17 - COMMON STOCK AND EARNINGS PER SHARE


           SFAS No. 128, "Earnings per Share" requires that the Company present
basic and diluted net income (loss) per common share. The assumed conversion of
stock options creates the difference between basic and diluted net income (loss)
per common share. Income (loss) per share is calculated by dividing net income
by the weighted average number of common shares outstanding for each period
presented. The weighted average number of common shares outstanding for basic
net income (loss) per common share was 736,118 in 2000 and 735,868 in 1999 and
1998. The weighted average number of common shares outstanding for diluted net
income per common share was 822,407 and 824,050 in 2000 and 1999. In 1998 the
Company reported net losses and accordingly the diluted computation was
antidilutive.

NOTE 18 - REGULATORY MATTERS


           The Bank is subject to various regulatory capital requirements
administered by the federal banking agencies. Failure to meet minimum capital
requirements can initiate certain mandatory, and 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
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 total and Tier 1 capital to risk-weighted assets, and of
Tier 1 capital to average assets. Management believes, as of December 31, 2000,
that the Bank meets all capital adequacy requirements to which it is subject.

           As of December 31, 2000, the most recent notification of the Office
of the Comptroller of the Currency categorized the Bank as well capitalized
under the regulatory framework for prompt corrective action. There are no
conditions or events since that notification that management believes have
changed the institution's category.

                                      F-21
<PAGE>   38
NOTE 18 - REGULATORY MATTERS, CONTINUED

           The Bank's actual capital amounts and ratios and minimum regulatory
amounts and ratios are presented as follows:


<TABLE>
<CAPTION>
                                                                                                       TO BE WELL CAPITALIZED UNDER
                                                                           FOR CAPITAL ADEQUACY          PROMPT CORRECTIVE ACTION
                                                                              PURPOSES                          PROVISIONS
                                                                          ----------------------          ---------------------

                                                 ACTUAL                        MINIMUM                           MINIMUM
                                        --------------------------        -----------------------         ---------------------

                                         AMOUNT              RATIO        AMOUNT            RATIO         AMOUNT         RATIO
                                         ------              -----        ------            -----         ------         -----
                                                                          (AMOUNTS IN $000)
<S>                                    <C>                   <C>         <C>                <C>          <C>           <C>
AS OF DECEMBER 31, 2000
   Total Capital (to risk
      Weighted assets).........        $ 6,428               13.8%       $3,731             8.0%         $4,664        10.0%
   Tier 1 Capital (to risk
      Weighted assets).........          5,859               12.6%        1,866             4.0           2,798         6.0
   Tier 1 Capital (to
      Average assets)..........          5,859                9.4         2,499             4.0           3,123         5.0

AS OF DECEMBER 31, 1999
   Total Capital (to risk
      Weighted assets).........          6,032               17.7         2,721             8.0           3,401        10.0
   Tier 1 Capital (to risk
      Weighted assets).........          5,623               16.5         1,360             4.0           2,041         6.0
   Tier 1 Capital (to
      Average assets)..........          5,623               12.7         1,773             4.0           2,217         5.0
</TABLE>

NOTE 19  - FAIR VALUE OF FINANCIAL INSTRUMENTS

           SFAS No. 107, "Disclosures about Fair Value of Financial Instruments"
requires disclosure of fair value information, whether or not recognized in the
balance sheets, when it is practical to estimate the fair value. SFAS No. 107
defines a financial instrument as cash, evidence of an ownership interest in an
entity or contractual obligations which require the exchange of cash or other
financial instruments. Certain items are specifically excluded from the
disclosure requirements, including the Company's common stock, premises and
equipment and other assets and liabilities.

           Fair value approximates carrying value for the following financial
instruments due to the short-term nature of the instrument: cash and due from
banks, federal funds sold and short term investments and stock.

           Securities are valued using quoted fair market prices. Fair value for
the Company's off-balance sheet financial instruments is based on the discounted
present value of the estimated future cash flows.

           Fair value for fixed rate loans maturing after one year is based on
the discounted present value of the estimated future cash flows. Discount rates
used in these computations approximate the rates currently offered for similar
loans of comparable terms and credit quality.

           Fair value for demand deposit accounts, interest-bearing accounts
with no fixed maturity date, and certificate of deposit accounts are valued by
discounting at rates currently available on similar account types.

           Fair value for long-term debt is based on discounted cash flows using
the Company's current incremental borrowing rate. Discount rates used in these
computations approximate rates currently offered for similar borrowings of
comparable terms and credit quality.

           The Company has used management's best estimate of fair value based
on the above assumptions. Thus, the fair values presented may not be the amounts
which could be realized in an immediate sale or settlement of the

                                      F-22
<PAGE>   39
NOTE 19 - FAIR VALUE OF FINANCIAL INSTRUMENTS, CONTINUED

instrument. In addition, any income taxes or other expenses which would be
incurred in an actual sale or settlement are not taken into consideration in the
fair value presented.

The estimated fair values of the Company's financial instruments are as follows:
<TABLE>
<CAPTION>
                                                                            DECEMBER 31,
                                                         ----------------------------------------------------
                                                                   2000                          1999
                                                         ---------------------         ----------------------
                                                         CARRYING         FAIR         CARRYING         FAIR
                                                          AMOUNT          VALUE         AMOUNT          VALUE
                                                          ------          -----         ------          -----
FINANCIAL ASSETS:
<S>                                                    <C>            <C>            <C>            <C>
    Cash and due from banks .......................    $ 1,359,158    $ 1,359,158    $ 2,516,526    $ 2,516,526
    Federal funds sold and short term investments .      6,919,000      6,919,000           --             --
    Investment securities .........................      7,899,133      7,899,133      8,980,109      8,980,109
    Federal Reserve Bank stock ....................        164,700        164,700        190,850        190,850
    Federal Home Bank Loan Bank stock .............        122,200        122,200        112,200        112,200
    Loans, net ....................................     45,052,910     44,232,947     32,129,114     30,131,000

FINANCIAL LIABILITIES:
    Deposits ......................................     56,726,511     64,055,576     36,836,020     29,468,816
    FHLB advances .................................           --             --        1,900,000      1,900,000
    Federal funds purchased .......................           --             --          920,000        920,000

FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISKS:
    Commitments to extend credit ..................      6,225,000      6,225,000      3,586,349      3,586,349
    Standby letters of credit .....................        840,999        840,999         25,000         25,000
</TABLE>

                                      F-23
<PAGE>   40
NOTE 20 - PARENT COMPANY FINANCIAL INFORMATION

           Following is condensed financial information of Beach First National
Bancshares, Inc. (parent company only):


                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                DECEMBER 31,
                                                            --------------------
                                                             2000           1999
                                                             ----           ----

ASSETS
<S>                                                       <C>           <C>
Cash .................................................    $    9,344    $   56,254
Due from Bank subsidiary .............................       317,901       104,754
Investment in Bank subsidiary ........................     5,816,629     5,438,309
Securities available for sale ........................       600,454       730,369
Other assets .........................................        26,491        16,596
                                                          ----------    ----------

            Total assets .............................    $6,770,819    $6,346,282
                                                          ==========    ==========


LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable .....................................    $   42,149    $   32,969
Shareholders' equity .................................     6,728,670     6,313,313
                                                          ----------    ----------

            Total liabilities and shareholders' equity    $6,770,819    $6,346,282
                                                          ==========    ==========
</TABLE>


                       CONDENSED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                  FOR THE YEARS ENDED DECEMBER 31,
                                                                  --------------------------------
                                                                  2000        1999          1998
                                                                  ----        ----          ----

REVENUES
<S>                                                              <C>         <C>          <C>
Interest income .............................................    $ 40,681    $ 40,337     $  46,720
Gain (loss) on sale of securities ...........................         167      (1,363)       (1,155)
Other income ................................................        --            91           100
                                                                 --------    --------     ---------

           Total revenues ...................................      40,848      39,065        45,665
                                                                 --------    --------     ---------


EXPENSES
Amortization ................................................       2,900       2,900         2,900
Other expenses ..............................................      31,384      25,081        53,630
                                                                 --------    --------     ---------

           Total expenses ...................................      34,284      27,981        56,530
                                                                 --------    --------     ---------

Income (loss) before equity in undistributed
  net income (loss) of Bank subsidiary ......................       6,564      11,084       (10,865)
Equity in undistributed net income (loss) of Bank  Subsidiary     224,159      41,837      (222,318)
                                                                 --------    --------     ---------

           Net income (loss) ................................    $230,723    $ 52,921     $(233,183)
                                                                 ========    ========     =========
</TABLE>

                                      F-24
<PAGE>   41
NOTE 20 - PARENT COMPANY FINANCIAL INFORMATION, CONTINUED

                       CONDENSED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                            FOR THE YEARS ENDED DECEMBER 31,
                                                            --------------------------------
                                                            2000          1999          1998
                                                            ----          ----          ----


OPERATING ACTIVITIES
<S>                                                      <C>           <C>           <C>
  Net income (loss) .................................    $ 230,723     $  52,921     $(233,183)
  Adjustments to reconcile net income (loss) to net
    cash provided by (used in) operating activities
   Equity in undistributed net income (loss) of
    the bank subsidiary .............................     (224,159)      (41,837)      222,318
  Amortization ......................................        2,900         2,900         2,900
  Decrease (increase) in due from Bank ..............     (213,147)      248,284      (353,038)
  (Gain) loss on sale of securities .................         (167)        1,363         1,155
  (Increase) decrease in other assets ...............      (12,795)       (5,915)       50,412
  (Decrease) increase in accounts payable ...........       24,653        (3,659)       17,690
                                                         ---------     ---------     ---------

        Net cash provided by (used for) operating
          activities ................................     (191,992)      254,057      (291,746)

INVESTING ACTIVITIES
  Purchase of securities available for sale .........         --        (343,000)     (609,693)
  Proceeds from sale of securities available for sale      130,082       132,407       866,424
                                                         ---------     ---------     ---------

        Net cash provided by (used for) investing
          activities ................................      130,082      (210,593)      256,731

FINANCING ACTIVITIES
Proceeds from exercise of stock options .............       15,000          --            --
                                                         ---------     ---------     ---------

        Net increase (decrease) in cash and cash
          equivalents ...............................      (46,910)       43,464       (35,015)

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR ........       56,254        12,790        47,805
                                                         ---------     ---------     ---------

CASH AND CASH EQUIVALENTS, END OF
 YEAR ...............................................    $   9,344     $  56,254     $  12,790
                                                         =========     =========     =========
</TABLE>

                                      F-25
<PAGE>   42
                                   SIGNATURES

           In accordance with Section 13 or 15(d) of the Securities Exchange Act
of 1934 (the "Exchange Act"), the registrant caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                     BEACH FIRST NATIONAL BANCSHARES, INC.


Date:   June 18, 2001                By:       /s/ Walter E. Standish, III
       -------------------                    ---------------------------------
                                               Walter E. Standish, III
                                               President and Chief Executive
                                               Officer

           KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Walter E. Standish, III, his true and
lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments to this Annual Report on Form 10-KSB,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
attorney-in-fact and agent full power and authority to do and perform each and
every act and thing requisite or necessary to be done in and about the premises,
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that attorney-in-fact and agent, or his substitute
or substitutes, may lawfully do or cause to be done by virtue hereof.

           In accordance with the Exchange Act, this report has been signed
below by the following persons on behalf of the registrant in the capacities and
on the dates indicated.

<TABLE>
<CAPTION>
Signature                                           Title                       Date
---------                                           -----                       ----
<S>                                         <C>                                 <C>

/s/ Michael Bert Anderson                                                       06/18/01
--------------------------------
Michael Bert Anderson                             Director

*
--------------------------------
Orvis Bartlett Buie                               Director

/s/ Raymond E. Cleary III                                                       06/18/01
--------------------------------
Raymond E. Cleary III                       Chairman and Director

/s/ Michael D. Harrington                                                       06/18/01
--------------------------------
Michael D. Harrington                             Director

/s/ Joe N. Jarrett, Jr.                                                         06/18/01
--------------------------------
Joe N. Jarrett, Jr.                               Director

*
--------------------------------
Richard E. Lester                                 Director

/s/ Rick H. Seagroves                                                           06/18/01
--------------------------------
Rick H. Seagroves                                 Director
</TABLE>
<PAGE>   43
<TABLE>
<CAPTION>
Signature                                           Title                       Date
---------                                           -----                       ----
<S>                                   <C>                                       <C>

/s/ Don J. Smith                                                                06/18/01
--------------------------------
Don J. Smith                                      Director

/s/ Samuel Robert Spann, Jr.                                                    06/18/01
--------------------------------
Samuel Robert Spann, Jr.                          Director

/s/ B. Larkin Spivey, Jr.                                                       06/18/01
--------------------------------
B. Larkin Spivey, Jr.                             Director

/s/ Walter E. Standish, III                                                     06/18/01
--------------------------------
Walter E. Standish, III                 President, CEO, and Director

*
--------------------------------
James C. Yahnis                                   Director

/s/ Stephanie L. Vickers                                                        06/18/01
--------------------------------
Stephanie L. Vickers                  Chief Financial Officer and Principal
                                             Accounting Officer

/s/ Walter E. Standish, III                                                     06/18/01
-----------------------------
Walter E. Standish, III
As Attorney-In-Fact
</TABLE>